What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2025-03-05 compared with 2024-02-28 · 121 added, 102 removed, 191 unchanged (54% of the section changed)

10 unchanged sentences

The forward-looking statements contained in this Annual Report on Form 10-K are made as of the date of this Annual Report on Form 10-K,and we do not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

We are a clinical stage genome editing company dedicated to developing potentially transformative genomic medicines to treat a broad range of serious diseases.

We are a pioneering gene editing company dedicated to developing potentially transformative genomic medicines to treat a broad range of serious diseases.

We have developed a proprietary gene editing platform based on CRISPR technology and we continue to expand its capabilities.

Our product development strategy is to target diseases where gene editing can be used to enable or enhance therapeutic outcomes for patients, while maximizing probability of technical, regulatory and commercial success.

W e are focused on advancing gene editing medicines to treat hemoglobinopathies, beginning with the continued development of our current ex vivo renizgamglogene autogedtemcel ("reni-cel") (formerly known as EDIT-301) program and leveraging the insights gained from this program to pursue next generation in vivo gene editing medicines targeting hematopoietic stem cells (“HSCs”).

We are also pursuing the development of in vivo gene editing medicines for other organs and tissues that we believe will significantly differentiate our genome editing approach from the current standards of care for serious diseases.

As part of these efforts, we are using strategic partnerships and collaborations and pursuing further opportunities to extend the reach of our intellectual property portfolio and access complementary technologies to expedite our drug discovery and clinical execution objectives.

Our lead program, reni-cel, is an experimental ex vivo gene-edited medicine to treat sickle cell disease (“SCD”), a severe inherited blood disease that causes premature death, and transfusion-de pendent beta thalassemia (“TDT”), the most severe form of beta-thalassemia, another inherited blood disorder characterized by severe anemia.

We are investigating reni-cel in a single Phase 1/2/3 clinical trial, referred to as the RUBY trial, for the treatment of severe SCD.

In 2022, we dosed the first patient in the RUBY trial, and after completing sequential dosing of the first two patients, we commenced concurrent patient dosing in the first quarter of 2023.

Through February 28, 2024, we have enrolled 40 patients and dosed 18 patients in the RUBY trial .

We continue to enroll and dose patients in the adult cohort of the RUBY trial, with multiple patients scheduled for dosing.

We have also initiated enrollment in the adolescent cohort.

In December 2021, the U.S.

Food and Drug Administration (the "FDA") cleared our Investigational New Drug (“IND”) application for a Phase 1/2 clinical trial of reni-cel for the treatment of TDT, which we refer to as our EdiTHAL.

We dosed the first patient in this trial in the first quarter of 2023 and commenced concurrent patient dosing in the second

quarter of 2023.

Through February 28, 2024, we have enrolled 9 patients and dosed 7 patients in the EdiTHAL trial, and continue to enroll and dose patients.

In December 2023, we presented new safety and efficacy data in 17 patients treated with reni-cel in both the RUBY and EdiTHAL trials.

This clinical data, which remained consistent with and further confirmed earlier clinical results shared in June 2023 and December 2022, supports our belief that reni-cel can be a clinically differentiated, one-time, durable medicine that can provide life-changing clinical benefits to patients with SCD and TDT, specifically driving early and robust correction of anemia and sustained increases in fetal hemoglobin.

For additional information regarding these clinical data, please see “Business—Our Gene Editing Medicine Programs—Hemoglobinopathies.” We expect to provide a clinical data updates for both the RUBY and EdiTHAL trials in mid-2024 and by year-end 2024.

We are also pursuing the development of next generation in vivo administered gene editing medicines, in which the medicine is injected or infused into the patient to edit the cells inside their body.

We are initially focused on editing HSCs through targeted delivery of our AsCas12a enzyme to our clinically validated HBG1 and HBG2 promotor site.

In 2023, we strengthened and focused our discovery organization to build an in vivo gene editing pipeline, and are on track to establish in vivo preclinical proof-of-concept for an undisclosed indication by year-end 2024.

We are pursuing the right combination of gene editing and targeted delivery tools through internal development and the in-licensing of complementary technologies, while also leveraging our intellectual property portfolio to drive potential out-licensing and partnership discussions that can accelerate the achievement of our goal of delivering lifesaving medicines to patients with previously untreatable diseases.

In December 2023, we and Vertex Pharmaceuticals Incorporated (“Vertex”) entered into a license agreement, under which Vertex obtained a non-exclusive license for our Cas9 gene editing technology for ex vivo gene editing medicines targeting the BCL11A gene in the fields of sickle cell disease and transfusion-dependent beta thalassemia, including Vertex’s CASGEVY TM (exagamglogene autotemcel).

We received a $50.0 million upfront cash payment and are eligible to receive an additional $50.0 million contingent upfront payment.

We are also eligible to receive annual license fees, ranging from $10.0 million to $40.0 million annually, inclusive of certain sales-based annual license fee increases, through 2034.

We are focused on the development of in vivo gene editing medicines utilizing functional upregulation, which aims to increase the expression and function of a normal gene copy and its normal protein function to treat diseases caused by genetic mutations that eliminate or disrupt normal function.

We believe the ability to provide in vivo gene editing, in which the medicine is injected or infused into the patient to edit the cells inside their body, and functionally upregulates normal gene expression and normal protein function in the target tissues holds the potential to significantly expand the addressable therapeutic possibilities of CRISPR-based gene editing.

To that end, our preclinical efforts are also focused on the creation of a “plug ‘n play” LNP platform that enables delivery of the gene editing cargo to multiple cells and tissues, including hematopoietic stem cells (“HSCs”), the liver and other cells and tissues.

We previously demonstrated proof of concept of our functional upregulation strategy in our clinical trials of renizgamglogene autogedtemcel (“reni-cel”), an experimental ex vivo gene-edited medicine to treat sickle cell disease (“SCD”) and transfusion-dependent beta thalassemia (“TDT”).

Despite the robust and clinically meaningful improvements observed in these trials, we determined in December 2024 not to pursue commercialization for reni-cel in order to optimize our cost structure and accelerate our intent to achieve in vivo human proof of concept in approximately two years.

However, l everaging our differentiated approach and the insights gained from these trials, we are initially focused on pursuing next generation in vivo gene editing medicines targeting HSCs.

In October 2024, we shared our achievement of in vivo preclinical proof of concept of hematopoietic stem and progenitor cell editing and fetal hemoglobin induction in

humanized mice engrafted with human HSCs and lacking their own hematopoietic cells using a novel and proprietary targeted lipid nanoparticle (“tLNP”) formulation for non-liver, or extrahepatic, tissue delivery.

Building on this achievement, in January 2025, we announced in vivo preclinical proof of concept of editing HSCs in non-human primates, a key step in developing a treatment for SCD and TDT.

We are on track to declare a development candidate in HSCs for the in vivo treatment of SCD and TDT in mid-2025.

Beyond hemoglobinopathies, our discovery and development efforts are focused on in vivo gene editing medicines in liver cells and other cells and tissues.

In preclinical studies for an undisclosed liver target, we have achieved an editing level of approximately 65% in non-human primates, near the theoretical maximum liver editing level of 70%, with minimal non-target tissue editing using AsCas12a and a liver targeted lipid nanoparticle (“LNP”).

This editing resulted in robust serum biomarker reduction from the baseline of approximately 80%.

We further announced in vivo delivery to two additional cell types in humanized mice using our proprietary LNP targeting platform.

We are on track to declare a development candidate for an in vivo gene editing medicine in liver cells for an undisclosed indication in mid-2025 and to establish and disclose an extrahepatic, non-HSC target cell type or tissue by the end of 2025.

We expect to present further in vivo HSC data and present further in vivo data in one liver indication by the end of 2025.

We are pursuing the right combination of gene editing and targeted delivery tools through internal development and the in-licensing of complementary technologies to build our preclinical pipeline and accelerate the achievement of our goal of delivering lifesaving medicines to patients with previously untreatable diseases.

Through in-licensing of complementary technologies, we can expand our existing gene editing platform and further drive the development of our in vivo pipeline.

This was recently demonstrated with our entry in 2024 into a collaboration and license agreement to access LNPs targeting the liver, which we used in our achievement of in vivo editing of liver cells in non-human primates.

We also actively seek opportunities to out-license and partner our robust intellectual property portfolio to drive the development of CRISPR-based medicines in therapeutic areas outside of our core focus and to provide non-dilutive capital.

For example, in cellular therapy medicines, we are leveraging partnerships to progress engineered cell medicines to treat various cancers, including in our collaboration with Bristol Myers Squibb Company (“BMS”) through its wholly owned subsidiary, Juno Therapeutics, Inc.

(“Juno Therapeutics”).

This collaboration, which leverages our Cas9 and AsCas12a platform technologies, seeks to advance alpha-beta T-cell experimental medicines for the treatment of solid and liquid tumors, and has resulted in 14 total programs to date.

In addition, in December 2023, we and Vertex Pharmaceuticals Incorporated (“Vertex”) entered into a license agreement, under which Vertex obtained a non-exclusive license for our Cas9 gene editing technology for ex vivo gene editing medicines targeting the BCL11A gene in the fields of SCD and TDT, including Vertex’s CASGEVY TM (exagamglogene autotemcel).

We received a $50.0 million upfront cash payment in the fourth quarter of 2023 and the 2024 annual license fee of $10.0 million in the first quarter of 2024.

The license agreement further provides for the payment by Vertex of a potential additional $50.0 million contingent upfront payment and further future fixed and sales-based annual license fees, ranging from $10.0 million to $40.0 million annually, inclusive of certain sales-based annual license fee increases, through 2034.

We are required to pay The Broad Institute, Inc.

(“Broad”) and the President and Fellows of Harvard College (“Harvard”) a mid-double-digit percentage of amounts received from Vertex under the license agreement as it relates to Cas9 technology licensed by us from Broad and Harvard.

(“Broad”) and the President and Fellows of Harvard College (“Harvard”) a mid-double-digit percentage of amounts payable to us from Vertex under the license agreement as it relates to Cas9 technology licensed by us from Broad and Harvard.

In October 2024, we entered into an agreement (the “DRI Agreement”) with a wholly owned subsidiary of DRI Healthcare Trust (“DRI”) providing for an upfront cash payment by DRI to us of $57.0 million in exchange for the acquisition by DRI of up to 100% of certain of the annual license fees owed to us under the Vertex license agreement, which fees range from $5.0 million to $40.0 million per year (inclusive of certain sales-based annual license fees that may become due), and a mid-double-digit percentage of the $50.0 million contingent upfront payment, in each case after subtracting amounts owed by us to Broad and Harvard.

We have retained rights to our portions of certain other sales-based annual license fees and the contingent upfront payment that may become due under the license agreement with Vertex, and the amounts that correspond to our licensor obligations.

In August 2023, we entered into a license agreement with Vor Biopharma, Inc.

(“Vor Bio”), providing Vor Bio a non-exclusive license for the development of ex vivo Cas 9 gene edited HSC therapies for the treatment and/or prevention of hematological malignancies.

Under this agreement, we received an upfront payment and are eligible for future development, regulatory and commercial milestone payments, as well as royalties on medicines utilizing the related intellectual property.

In cellular therapy medicines, we are leveraging partnerships to progress engineered cell medicines to treat various cancers.

We are advancing alpha-beta T-cell experimental medicines for the treatment of solid and liquid tumors in collaboration with Bristol Myers Squibb Company (“BMS”) through its wholly owned subsidiary, Juno Therapeutics, Inc.

(“Juno Therapeutics”).

This collaboration, which leverages our Cas9 and AsCas12a platform technologies, has resulted in 13 total programs.

We have also entered into a non-exclusive collaboration and licensing agreement with Immatics N.V.

to combine gamma-delta T cell adoptive cell therapies and gene editing to develop medicines for the treatment of cancer.

Under this agreement, we received an upfront payment and will be eligible for future development, regulatory and commercial milestone payments, as well as royalties on medicines utilizing the related intellectual property.

Since our inception in September 2013, our operations have focused on organizing and staffing our company, business planning, raising capital, establishing our intellectual property portfolio, assembling our core capabilities in gene editing, seeking to identify potential product candidates, and undertaking preclinical studies and clinical trials.

Except for reni-cel, all of our ongoing research programs are still in the preclinical or research stage of development and the risk of failure of all of our research programs is high.

All of our ongoing research programs are still in the preclinical or research stage of development and the risk of failure of all of our

research programs is high.

We have not generated any revenue from product sales.

We have primarily financed our operations through various equity financings, payments received under our research collaboration with BMS, our former strategic alliance with Allergan Pharmaceuticals International Limited (together with its affiliates, “Allergan”), which was terminated in August 2020, and payments received in conjunction with our license agreement with Vertex .

We have primarily financed our operations through various equity financings, payments received under our research collaboration with BMS through its wholly owned subsidiary Juno Therapeutics, our former strategic alliance with Allergan Pharmaceuticals International Limited (together with its affiliates, “Allergan”), which was terminated in August 2020, payments received under the DRI Agreement in connection with our license agreement with Vertex, and payments under the Vertex license agreement.

Since inception, we have incurred significant operating losses.

3 unchanged sentences

Our net losses may fluctuate significantly from quarter to quarter and from year to year.

We anticipate

that our expenses will increase substantially as we continue our current research programs and our preclinical development activities;

progress the clinical development of reni-cel;

We anticipate that our expenses will increase substantially as we continue our current research programs and our preclinical development activities;

seek to identify additional research programs and additional product candidates;

9 unchanged sentences

We no longer receive research funding support.

During the year ended December 31, 2023, we recognized $4.5 million of revenue related to our collaboration with BMS of which none was previously deferred revenue.

During the year ended December 31, 2024, we recognized $18.1 million of revenue related to our collaboration with BMS of which $6.5 million was previously deferred revenue.

As of December 31, 2024, we had $50.2 million of deferred revenue related to BMS, of which $50.2 million is classified as long-term on our consolidated balance sheet.

1 unchanged sentence

As such, we expect that our revenue will fluctuate from quarter-to-quarter and year-to-year as a result of the timing of when these events occur.

Upon execution of the license agreement with Vertex, we received a $50.0 million upfront cash payment and are eligible to receive an additional $50.0 million contingent upfront payment.

We are also eligible to receive annual license fees, ranging from $10.0 million to $40.0 million annually, inclusive of certain sales-based annual license fee increases, through 2034.

As of December 31, 2023, we have recorded $60.0 million of revenue related to the agreement.

For additional information about our revenue recognition policy related to the Vertex license agreement and BMS collaboration, see “—Critical Accounting Policies and Estimates—Revenue Recognition” included in this Annual Report on Form 10-K.

For the foreseeable future we expect substantially all of our revenue will be generated from our license agreement with Vertex, collaboration with BMS, and any other collaborations or license agreements we may enter into.

Pursuant to the license agreement with Vertex, we received a $50.0 million upfront cash payment in the fourth quarter of 2023 upon execution of the agreement and the 2024 annual license fee of $10.0 million in the first quarter of 2024.

For the year ended, December 31, 2024, we have recorded $10.0 million of revenue related to the agreement.

For additional information about our revenue recognition policy related to the Vertex license agreement and BMS collaboration, see Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates—Revenue Recognition” included in this Annual Report on Form 10-K.

For the foreseeable future we expect substantially all of our revenue will be generated from our license agreements with Vertex and Vor Bio, collaboration with BMS, and any other collaborations or license agreements we may enter into.

Research and Development Expenses

2 unchanged sentences

• employee-related expenses including salaries, benefits, and stock-based compensation expense;

• costs incurred under clinical trial agreements with investigative sites;

• costs incurred under clinical trial agreements with investigative sites for our former reni-cel program;

• costs associated with conducting our preclinical, process and scale-up development, manufacturing, quality, clinical and regulatory activities, including fees paid to third-party professional consultants, service providers and suppliers;

18 unchanged sentences

Research and development activities are central to our business model.

We expect research and development costs to increase significantly for the foreseeable future as our development programs progress, including as we continue to progress our clinical trials as well as support preclinical studies for our other research programs.

We expect research and development costs to increase significantly for the foreseeable future as our development programs progress, including as we continue to support preclinical studies and prepare for the clinical development of our research programs.

General and Administrative Expenses

1 unchanged sentence

Other significant costs include corporate facility costs not otherwise included in research and development expenses, legal fees related to intellectual property and corporate matters, and fees for accounting and consulting services.

We anticipate that our general and administrative expenses will increase in the future to support continued research and development activities and potential commercialization of any product candidates we identify and develop.

These increases will include increased costs related to the hiring of additional personnel and fees to outside consultants.

We also anticipate increased expenses related to reimbursement of third-party patent-related expenses and expenses associated with operating as a public company, including costs for audit, legal, regulatory, and tax-related services, director and officer insurance premiums, and investor relations costs.

With respect to reimbursement of third-party intellectual property-related expenses specifically, given the ongoing nature of the opposition and interference proceedings involving the patents licensed to us under our license agreement with Broad and the President and Harvard, we anticipate general and administrative expenses will continue to be significant.

We anticipate that our general and administrative expenses will decrease or remain flat in the near future to support continued research and development activities.

We anticipate that expenses associated with operating as a public company, including costs for audit, legal, regulatory, and tax-related services, director and officer insurance premiums, and investor relation costs will remain flat or decrease in the near future.

With respect to reimbursement of third-party intellectual property-related expenses specifically, given the ongoing nature of the opposition and interference proceedings involving the patents licensed to us under our license agreement with Broad and Harvard, we anticipate general and administrative expenses associated with reimbursement of third-party intellectual property-related expense will continue to fluctuate as the interference proceedings continue.

Restructuring Charges

In December 2024, our board of directors approved the discontinuation of the clinical development of our ex vivo reni-cel program.

As part of the discontinuation, our board approved a reduction in our employee workforce by approximately 180 positions, or by approximately 65%.

Restructuring charges consist primarily of expenses in connection with the wind-down of various activities related to clinical development of reni-cel, including contract termination costs, impairment charges and non-cash charges, and expenses related to the employee workforce reduction, primarily consisting of severance payments and employee benefit costs.

We may also incur additional costs not currently contemplated due to events that may occur as a result of or that are associated with the discontinuation and headcount reduction.

We estimate that we will incur approximately $45.0 million to $55.0 million in cash costs to implement the discontinuation and workforce reduction.

We expect restructuring charges to be substantially incurred through the end of June 2025, when the related activities are expected to be substantially complete.

Other Income (Expense), Net

31 unchanged sentences

The financial terms of these agreements are sometimes subject to negotiation, vary from contract to contract and may result in uneven payment flows.

There may be instances in which payments made to our service providers will exceed the level of services

performed and result in a prepayment of the clinical expense.

There may be instances in which payments made to our service providers will exceed the level of services performed and result in a prepayment of the clinical expense.

Payments under some of these contracts depend on factors such as the successful enrollment of patients and the completion of clinical milestones.

7 unchanged sentences

December 31, Dollar Change Percentage Change

Collaboration and other research and development revenues $ 78,123 $ 19,712 $ 58,411 n/m

Collaboration and other research and development revenues $ 32,314 $ 78,123 $ (45,809) (59) %

Operating expenses:

1 unchanged sentence

General and administrative 71,987 69,653 2,334 3 %

Restructuring charges 12,232 — 12,232 100 %

Total operating expenses 283,466 247,304 36,162 15 %

1 unchanged sentence

Other income, net:

Other income, net (1,604) — (1,604) n/m

Interest income, net 17,566 5,518 12,048 n/m

Total other income, net 15,962 5,518 10,444 n/m

Other expense, net (3) (1,604) 1,601 n/m

Interest income, net 14,062 17,566 (3,504) (20) %

Total other income, net 14,059 15,962 (1,903) (12) %

Net loss $ (237,093) $ (153,219) $ (83,874) 55 %

1 unchanged sentence

Collaboration and Other Research and Development Revenues

Collaboration and other research and development revenues increased by $58.4 million, to $78.1 million for the year ended December 31, 2023, from $19.7 million for the year ended December 31, 2022.

The increase was primarily attributable to revenue recognized under our license agreement with Vertex pursuant to the license agreement executed in December 2023.

Collaboration and other research and development revenues decreased by $45.8 million, to $32.3 million for the year ended December 31, 2024, from $78.1 million for the year ended December 31, 2023.

The decrease was primarily attributable to revenue recognized in 2023 under our license agreement with Vertex, which was executed in December 2023.

Research and Development Expenses

Research and development expenses increased by $21.5 million, to $199.2 million for the year ended December 31, 2024 from $177.7 million for the year ended December 31, 2023.

The following table summarizes our research and

development expenses for the years ended December 31, 2023 and December 31, 2022, together with the changes in those items in dollars (in thousands) and the respective percentages of change:

The following table summarizes our research and development expenses for the years ended December 31, 2024 and December 31, 2023, together with the changes in those items in dollars (in thousands) and the respective percentages of change:

December 31, Dollar Change Percentage Change

3 unchanged sentences

Stock-based compensation expenses 8,642 9,842 (1,200) (12) %

Sublicense and license fees 35,011 5,334 29,677 n/m

Sublicense and license fees 18,953 35,011 (16,058) (46) %

Other expenses 12,538 10,667 1,871 18 %

1 unchanged sentence

The increase in research and development expenses for the year ended December 31, 2024 compared to the year ended December 31, 2023 was primarily attributable to:

• approximately $29.7 million in increased sublicense and license fees primarily attributable to payments made related to our license agreement with Vertex;

• approximately $25.1 million in increased external research and development expenses primarily related to clinical and manufacturing costs related to the progression of our former reni-cel program as well as costs attributable to in vivo research and discovery;

• approximately $6.9 million in increased employee related expenses related to increased headcount;

• approximately $5.0 million in increased facility expenses primarily related to increased rent expense incurred in connection with a lease commencement for manufacturing space in the second quarter of 2024;

• approximately $1.9 million in increased other expenses attributable to consulting and external fees to support clinical and quality initiatives.

• approximately $0.4 million in increased facility expenses.

These increases were partially offset by the following decreases in research and development expenses:

• approximately $26.5 million in decreased external research and development expenses primarily related to our strategic reprioritization and targeted focus on our reni-cel program;

• approximately $16.1 million in decreased sublicense and license fees related to reduced licensing activity in 2024 compared to 2023;

• approximately $1.2 million in decreased stock-based compensation expense due primarily to a reduction in the market price of our common stock, resulting in a lower valuation of equity awards granted.

General and Administrative Expenses

General and administrative expenses decreased by approximately $1.1 million, to $69.7 million for the year ended December 31, 2023 from $70.7 million for the year ended December 31, 2022.

General and administrative expenses increased by approximately $2.3 million, to $72.0 million for the year ended December 31, 2024 from $69.7 million for the year ended December 31, 2023.

The following table summarizes our general and administrative expenses for the years ended December 31, 2024 and December 31, 2023, together with the changes in those items in dollars (in thousands) and the respective percentages of change:

6 unchanged sentences

Total general and administrative expenses $ 71,987 $ 69,653 $ 2,334 3 %

The decrease in general and administrative expenses for the year ended December 31, 2023 compared to the year ended December 31, 2022 was primarily attributable to:

• approximately $6.9 million in decreased stock-based compensation expense related to performance awards granted to our former Chief Executive Officer that were achieved or deemed probable in 2022, for which there was no similar expense in 2023, as well as a reduction in the market price of our common stock, resulting in a lower valuation of equity and awards granted;

• approximately $1.5 million in decreased intellectual property and patent related fees due to reduced legal activity;

• approximately $0.4 million in decreased employee related expenses;

• approximately $0.3 million in decreased facility and other expenses.

These decreases were partially offset by approximately $8.1 million in increased professional services to support strategic initiatives and business development activities.

The increase in general and administrative expenses for the year ended December 31, 2024 compared to the year ended December 31, 2023 was primarily attributable to:

• approximately $3.8 million in increased employee related expenses related to increased headcount;

• approximately $2.8 million in increased stock-based compensation expense due primarily to the vesting of certain restricted stock units upon the achievement of performance-based milestones in 2024, along with an increased headcount;

• approximately $0.7 million in increased intellectual property and patent related fees for legal activity;

• approximately $0.3 million in increased facility and other expenses.

These increases were partially offset by approximately $5.3 million in decreased professional services expenses primarily related to one-time expenses incurred in 2023 to support strategic initiatives and business development activities.

Restructuring Charges

Restructuring charges were $12.2 million for the year ended December 31, 2024, with no equivalent charges for the year ended December 31, 2023.

The following table summarizes our restructuring charges for the years ended December 31, 2024 and December 31, 2023, together with the changes in those items in dollars (in thousands) and the respective percentages of change:

December 31, Dollar Change Percentage Change

Employee termination benefits $ 10,475 $ — $ 10,475 100 %

Contract termination costs 1,757 — 1,757 100 %

Total restructuring charges $ 12,232 $ — $ 12,232 100 %

During the year ended December 31, 2024, we recorded $10.5 million and $1.8 million related to employee termination benefits and program-related contract termination costs, respectively, due to the discontinuation of the clinical development of our reni-cel program that we initiated in December 2024 and the related workforce reduction.

Total Other Income, Net

For the years ended December 31, 2024, and 2023, total other income, net was $14.1 million and $16.0 million, respectively, which was primarily attributable to interest income and accretion of discounts associated with marketable securities.

The increase was attributable to increased invested balances as well as favorable market rates.

The decrease was attributable to reduction of investment balances offset by increased market rates.

Comparison of Years Ended December 31, 2023 and 2022

For a discussion of our results of operations for the year ended December 31, 2022 as compared to the year ended December 31, 2021, see Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations in our annual report on Form 10-K for the year ended December 31, 2022, which was filed with the SEC on February 22, 2023.

For a discussion of our results of operations for the year ended December 31, 2023 as compared to the year ended December 31, 2022, see Part II, Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our annual report on Form 10-K for the year ended December 31, 2023, which was filed with the U.S.

Securities and Exchange Commission (the “SEC”) on February 28, 2024.

Liquidity and Capital Resources

Sources of Liquidity

As of December 31, 2023, we have raised an aggregate of $1.0 billion in net proceeds through the sale of shares of our common stock in public offerings and at-the-market offerings, including a public offering of our common stock in June 2023, pursuant to which we sold 12,500,000 shares of our common stock and received net proceeds of approximately $117.1 million after deducting underwriting discounts and commissions and other offering costs.

We also have funded our business from our research collaboration with BMS, our former strategic alliance with Allergan, and payments received under the license agreement with Vertex.

As of December 31, 2024, we have raised an aggregate of $1.0 billion in net proceeds through the sale of shares of our common stock in public offerings and at-the-market offerings.

We also have funded our business from our research collaboration with BMS through its wholly owned subsidiary Juno Therapeutics, our former strategic alliance with Allergan (which was terminated in August 2020), payments received under the DRI Agreement in connection with our license agreement with Vertex, and payments under the Vertex license agreement.

As of December 31, 2024, we had cash, cash equivalents and marketable securities of $269.9 million.

In May 2021, we entered into a common stock sales agreement with Cowen and Company, LLC (“Cowen”) under which we from time to time can issue and sell shares of our common stock through Cowen in at-the-market offerings for aggregate gross sale proceeds of up to $300.0 million (the “ATM Facility”).

We have not sold any shares of our common stock under this ATM Facility as of the date of this Annual Report on Form 10-K.

In May 2021, we entered into a common stock sales agreement with TD Securities (USA) LLC (as successor to Cowen and Company, LLC) (“TD Cowen”) under which we from time to time can issue and sell shares of our common stock through TD Cowen in at-the-market offerings for aggregate gross sale proceeds of up to $300.0 million (the “Prior ATM Facility”).

We amended the common stock sales agreement with TD Cowen in February 2024 in connection with filing a new registration statement.

In March 2025, we further amended our common stock sales agreement with TD Cowen in connection with amending our existing shelf registration statement following the loss of our status as a “well-known seasoned issuer” (as defined under Rule 450 of the Securities Act of 1933, as amended), reducing the amount of shares of common stock we may issue and sell through TD Cowen to aggregate gross sale proceeds of up to $150.0 million (the “ATM Facility”).

As of December 31, 2024, we had not sold any shares of our common stock under the Prior ATM Facility or the ATM Facility.

In addition to our existing cash, cash equivalents and marketable securities, we are eligible to earn milestone and other payments under our collaboration agreement with BMS and our other collaboration and license agreements.

Our ability to earn the milestone payments and the timing of earning these amounts are dependent upon the timing and outcome of our development, regulatory and commercial activities and, as such, are uncertain at this time.

As of December 31, 2023 , our right to contingent payments under our collaboration agreements with BMS and Vor Bio as well as our contingent upfront payment and annual license fees with Vertex are our only significant committed potential external source of funds.

ability to earn applicable milestone and other payments and the timing of earning these amounts are dependent upon the timing and outcome of development, regulatory and commercial activities and, as such, are uncertain at this time.

As of December 31, 2024 , our right to contingent payments under our collaboration agreements with BMS and Vor Bio, as well as the retained portions of the contingent upfront payment and other amounts under our license agreement with Vertex, are our only significant committed potential external source of funds.

The following table provides information regarding our cash flows for the years ended December 31, 2024 and 2023, respectively (in thousands):

3 unchanged sentences

Financing activities 56,027 118,039

Net decrease in cash, cash equivalents, and restricted cash $ (17,870) $ (61,997)

Net increase (decrease) in cash, cash equivalents, and restricted cash $ 7,889 $ (17,870)

Net Cash Used in Operating Activities

The use of cash in all periods resulted primarily from our net losses adjusted for non-cash charges and changes in components of working capital.

Net cash used in operating activities was approximately $132.2 million for the year ended December 31, 2023, which primarily consisted of operating expenses related to the focused progression of clinical and manufacturing activities in support of the reni-cel program, sublicense and license fees, and supporting business operations.

Net cash used in operating activities was approximately $177.3 million for the year ended December 31, 2022, which primarily consisted of operating expenses related to our on-going preclinical and clinical activities, sublicense and license fees, and increased personnel costs to support our expanding operations.

Net Cash (Used in) Provided by Investing Activities

Net cash used in operating activities was approximately $210.3 million for the year ended December 31, 2024, which primarily consisted of operating expenses that related to increasing our research efforts, the progression of clinical and manufacturing activities in support of our former reni-cel program and supporting business operations.

Net cash used in operating activities was approximately $132.2 million for the year ended December 31, 2023, which primarily consisted of operating expenses related to the focused progression of clinical and manufacturing activities in support of our former reni-cel program, sublicense and license fees, and supporting business operations.

Net Cash Provided by (Used in) Investing Activities

Net cash provided by investing activities was approximately $162.1 million for the year ended December 31, 2024, primarily related to maturities of marketable securities of $257.2 million.

This was offset by $86.2 million of purchases of marketable securities and purchases of property and equipment of $8.8 million.

Net cash used in investing activities was approximately $3.7 million for the year ended December 31, 2023, primarily related to the purchase of property and equipment of $4.7 million.

The remaining offset relates to maturities of marketable securities of $259.5 million and purchases of marketable securities of $258.5 million.

Net cash provided by investing activities was approximately $114.1 million for the year ended December 31, 2022, primarily related to proceeds from maturities of marketable securities of $433.4 million, partially offset by the cost of acquiring marketable securities of $315.2 million and purchases of property and equipment of $4.1 million.

The remaining offset related to maturities of marketable securities of $259.5 million and purchases of marketable securities of $258.5 million.

Net Cash Provided by Financing Activities

Net cash provided by financing activities was approximately $56.0 million for the year ended December 31, 2024 primarily related to net proceeds received from the sale of future revenue of $55.2 million, proceeds received from issuance of common stock under our employee stock purchase plan of $0.6 million and proceeds from the exercise of stock options of $0.2 million.

Net cash provided by financing activities was approximately $118.0 million for the year ended December 31, 2023, primarily related to proceeds received from the public offering of common stock, net of issuance costs, of $117.1 million in June 2023 and proceeds received from issuance of common stock under our employee stock purchase plan of $0.9 million.

Net cash provided by financing activities was approximately $1.3 million for the year ended December 31, 2022 primarily related to proceeds received from issuance of common stock under our employee stock purchase plan and exercises of options for our common stock.

For a discussion of our cash flows for the year ended December 31, 2021, see Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations in our annual report on Form 10-K for the year ended December 31, 2022, which was filed with the SEC on February 22, 2023.

For a discussion of our cash flows for the year ended December 31, 2022, see Part II, Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2023, which was filed with the SEC on February 28, 2024.

Funding Requirements

We expect our expenses to increase in connection with our ongoing activities, particularly as we progress the clinical development of reni-cel;

further advance our research programs and our preclinical development activities;

We expect our expenses to decrease over the next few years due to the discontinuation of the reni-cel program, but we will continue to incur significant expenses as we continue to advance our research programs and our preclinical development activities;

seek to identify product candidates and additional research programs;

initiate preclinical testing and clinical trials for other product

candidates we identify and develop;

maintain, expand, and protect our intellectual property portfolio, including reimbursing our licensors for expenses related to the intellectual property that we in-license from such licensors;

hire additional clinical, quality control, and scientific personnel;

initiate preclinical testing and clinical trials for other product candidates we identify and develop;

maintain, expand, and project our intellectual property portfolio, including reimbursing our licensors for expenses related to the intellectual property that we in-license from such licensors;

and incur costs associated with operating as a public company.

3 unchanged sentences

If we are unable to raise capital when needed or on attractive terms, we would be forced to delay, reduce, or eliminate our research and development programs or future commercialization efforts.

We expect that our existing cash, cash equivalents and marketable securities on December 31, 2023, together with the near-term annual license fees and the contingent upfront payment payable under our license agreement with Vertex, will fund our operating expenses and capital expenditure requirements into 2026.

We expect that our existing cash, cash equivalents and marketable securities on December 31, 2024, together with the retained portions of the payments payable under our license agreement with Vertex, will fund our operating expenses and capital expenditure requirements into the second quarter of 2027.

Our forecast of the period of time through which our existing cash and cash equivalents and investments will be adequate to support our operations is a forward-looking statement and involves significant risks and uncertainties.

2 unchanged sentences

The amount and timing of future funding requirements, both near- and long-term, will depend on many factors, including, but not limited to :

• the costs of progressing the clinical development of reni-cel to treat SCD and TDT;

• the restructuring costs associated with the discontinuation of reni-cel;

• the scope, progress, results, and costs of clinical trials, drug discovery, preclinical development, laboratory testing, and clinical or natural history study trials for other product candidates we develop;

13 unchanged sentences

Adequate additional financing may not be available to us on acceptable terms, or at all.

Until such time, if ever, as we can generate substantial product revenues, we expect to finance our cash needs through a combination of equity offerings, debt financings, collaborations, strategic alliances, and licensing arrangements.

To the extent that we raise additional capital through the sale of equity or convertible debt securities, our stockholders’ ownership interests will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our stockholders.

Debt financing, if available, would result in increased fixed payment obligations and may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, or declaring dividends.

If we raise funds through additional collaborations, strategic alliances, or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs, or product candidates or to grant licenses on terms that may not be favorable to us.

If we raise funds through additional collaborations, strategic alliances, licensing arrangements, or future royalty sales with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs, or product candidates or to grant licenses on terms that may not be favorable to us.

If we are unable to raise additional funds through equity or debt financings when needed, we may be required to delay, limit, reduce, or terminate our product development or future commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

2 unchanged sentences

These minimum lease payments exclude our share of the facility operating expenses, real-estate taxes and other costs that are reimbursable to the landlord under the leases.

In the second quarter of 2023, we entered into a license and service agreement pursuant to which we will lease manufacturing space for our continued research and development activities.

As of December 31, 2023, the lease had not commenced for accounting purposes and it is not expected to commence until the first half of 2024.

The license and service agreement provides for total remaining lease payments of up to $85.4 million over a 10-year lease term.

We may terminate the license and service agreement in our discretion upon twelve months' prior written notice.

In 2023, we entered into a license and service agreement pursuant to which we leased manufacturing space for our continued research and development activities.

The lease commenced April 1, 2024.

In September 2024, we modified the lease, and as a result of the modification the lease payments decreased and the notification period for the termination of the license and service agreement increased from 12 months’ prior written notice to 18 months’ prior written notice.

In January 2025, we gave our termination notice on the license and service agreement.

The license and service agreement will terminate in July 2026.

From January 2025 through July 2026, we will incur minimum lease payments of up to $11.1 million.

In October 2024, we entered into a purchase and sale agreement (the “Purchase and Sale Agreement”) with DRI Healthcare Acquisitions LP (the “DRI”) under which we sold, transferred, assigned, and conveyed to DRI certain future license fees and other payments (the “Purchased Receivables”) owed to us by Vertex Pharmaceuticals, Inc.

(“Vertex”) under the terms of a license agreement (the “License Agreement”) in exchange for an upfront cash payment by DRI to us of $57.0 million.

Under the Purchase and Sale Agreement, DRI is purchasing up to 100% of certain future fixed and sales-based annual license fees owed to us under the License Agreement, which fees range from $5.0 million to $40.0 million per year (inclusive of certain sales-based annual license fee increases), and a mid-double-digit percentage of the $50.0 million contingent upfront payment that we may receive under the License Agreement, in each case after subtracting amounts owing by us to our licensors, The Broad Institute, Inc.

and the President and Fellows of Harvard College.

We have retained rights to our portions of certain other sales-based annual license fees and the contingent upfront payment that may become due under the License Agreement, and the amounts that correspond to our licensor obligations.

Our agreements with certain institutions to license intellectual property include potential milestone and success fees, sublicense fees, royalty fees, licensing maintenance fees, and reimbursement of patent maintenance costs that we may be required to pay.

1 unchanged sentence

These potential obligations are contingent upon the occurrence of future events and the timing and likelihood of such potential obligations are not known with certainty.

For further information regarding these agreements, please see “Business—Our Collaborations and Licensing Strategy.”

For further information regarding these agreements, please see Part I, Item 1 “Business—Our Collaborations and Licensing Strategy” of this Annual Report on Form 10-K.

We also enter into contracts in the normal course of business with contract research organizations, contract manufacturing organizations and other vendors to assist in the performance of our research and development activities and other services and products for operating purposes.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis