What changed in this filing

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

2025-03-05 compared with 2024-02-28 · 242 added, 149 removed, 715 unchanged (35% of the section changed)

1 unchanged sentence

We are exposed to market risk related to changes in interest rates.

As of December 31, 2023, we had cash and cash equivalents of $123.7 million, primarily held in money market mutual funds consisting of U.S.

government-backed securities, and marketable securities of $303.5 million, primarily consisting of U.S.

As of December 31, 2024, we had cash and cash equivalents of $131.5 million, primarily held in money market mutual funds, and marketable securities of $138.4 million, primarily consisting of U.S.

government-backed securities, U.S.

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generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company's internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 28, 2024 expressed an unqualified opinion thereon.

Basis for Opinion

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Our responsibility is to express an opinion on the Company‘s financial statements based on our audits.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

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Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

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The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the financial statements and (2) involved especially challenging, subjective or complex judgments.

The communication of the critical audit matter does not alter in any way our opinion on the consolidated

financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Research and Development Accruals

Description of the Matter The Company’s accrual for research and development expenses totaled $16.2 million at December 31, 2023.

(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of the critical audit matter does not alter in any way our opinion on the

consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Accrued Research and Development Expenses

Description of the Matter The Company’s accrued research and development expenses totaled $13.3 million at December 31, 2024, which includes accrued clinical trial expenses.

As discussed in Note 2 to the consolidated financial statements, the Company expenses research and development costs as incurred.

The Company’s determination of costs incurred to conduct research and development on the Company’s product candidates, as well as the related accrued expenses at each reporting period incorporates judgment and utilizes various assumptions, including an evaluation of the information provided to the Company by third parties on actual costs incurred but not yet billed, estimated project timelines and patient enrollment.

Payments for these activities are based on the terms of the individual arrangements, which often differ from the pattern of costs incurred.

Auditing the Company’s research and development accruals is especially complex due to the judgments and estimations of the research and development expenses.

The Company uses judgment and estimation to estimate costs incurred and not yet billed at each reporting period as a result of the volume of R&D contracts, as well as the extent of third-party vendors utilized.

Additionally, due to the timing of invoices received from third parties, actual amounts incurred are not always known as of the audit report date.

How We Addressed the Matter in Our Audit We obtained an understanding of the Company’s process, evaluated and tested the design and operating effectiveness of internal controls that address the risks related to the completeness and valuation of accrued research and development expenses.

To test the research and development accrual, our audit procedures included, among others, testing the accuracy and completeness of the underlying data used in the estimates and evaluating and testing the significant assumptions that are used by management to estimate the accruals.

To test the significant assumptions, we inspected the contracts and any amendments to the contracts with third-party service providers, corroborated the progress of research and development projects with the Company’s research and development personnel that oversee the clinical trials and the related manufacturing activities, and reviewed information received from third party vendors, which included the third parties’ estimate of costs incurred to date.

We also tested subsequent invoicing received from third parties.

The Company accrues expenses related to clinical trials based on estimates of the services performed pursuant to their contractual arrangements, including those with clinical research organizations.

Payments under these contracts may depend on factors such as the successful enrollment of patients and the completion of clinical milestones and may differ from the level of effort expended in each period.

How We Addressed the Matter in Our Audit Auditing the Company’s accrued research and development expenses was complex in the context of this audit due to the volume of research and development activity and the reliance on third-party vendors.

That is, due to the timing and pattern of invoices received from third parties, actual amounts incurred were not always known as of the audit report date.

To test the accrued research and development expenses related to clinical trials, our audit procedures included, among others, obtaining an understanding of the Company’s process, testing the accuracy and completeness of the underlying data used in the estimates and evaluating and testing the significant assumptions that are used by management to estimate the accruals.

To test the significant assumptions, we inspected the contracts and any amendments to the contracts with third-party service providers, and corroborated the progress of research and development projects with the Company’s research and development personnel that oversee the clinical trials.

We also obtained evidence from the Company’s clinical research organization, including the number of patients, sites, purchase order amounts and total amounts invoiced to date.

To further evaluate completeness, we tested invoices and payments to third parties subsequent to year-end.

/ s/ Ernst & Young LLP

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Boston, Massachusetts

February 28, 2024

March 5, 2025

Editas Medicine, Inc.

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Accrued expenses 45,859 34,563

Liability for sale of future revenues, current 5,000 —

Deferred revenue, current 6,221 8,221

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Operating lease liabilities, net of current portion 20,380 24,372

Liability for sale of future revenues - non-current 52,434 —

Deferred revenue, net of current portion 54,204 60,667

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Additional paid-in capital 1,602,441 1,580,241

Accumulated other comprehensive income (loss) 198 ( 3,601 )

Accumulated other comprehensive income 268 198

Accumulated deficit ( 1,468,443 ) ( 1,231,350 )

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General and administrative 71,987 69,653 70,704

Restructuring charges 12,232 — —

Total operating expenses 283,466 247,304 245,662

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Other income, net:

Other income, net ( 1,604 ) — 37

Other expense, net ( 3 ) ( 1,604 ) —

Interest income, net 14,062 17,566 5,518

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Balance at December 31, 2021 68,435,257 $ 7 $ 1,411,827 $ ( 857,699 ) $ ( 493 ) $ 553,642

Issuance of common stock from public offering, net of issuance costs of $0.3 million 4,025,000 1 249,458 — — 249,459

Issuance of common stock for repayment of notes payable 303,599 — 27,500 — — 27,500

Exercise of stock options 19,769 — 305 — — 305

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Balance at December 31, 2022 68,847,382 $ 7 $ 1,442,405 $ ( 1,078,131 ) $ ( 3,601 ) $ 360,680

Issuance of common stock from public offering, net commissions, underwriting discounts and offering costs 12,500,000 1 117,078 — — 117,079

Exercise of stock options 6,587 — 41 — — 41

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Purchase of common stock under benefit plan 115,360 — 919 — — 919

Unrealized loss on marketable debt securities — — — — ( 3,108 ) ( 3,108 )

Unrealized gain on marketable debt securities — — — — 3,799 3,799

Net loss — — — ( 153,219 ) — ( 153,219 )

Balance at December 31, 2023 81,767,263 $ 8 $ 1,580,241 $ ( 1,231,350 ) $ 198 $ 349,097

Issuance of common stock from public offering, net commissions, underwriting discounts and offering costs 12,500,000 1 117,078 — — 117,079

Exercise of stock options 23,809 — 193 — — 193

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Net amortization of premiums and discounts on marketable securities ( 5,791 ) ( 4,823 ) ( 724 )

Loss on disposal of fixed assets 149 — —

Non-cash interest expense on liability for sale of future revenues 2,190 — —

Other non-cash items, net ( 415 ) 1,596 —

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Proceeds from offering of common stock, net of issuance costs — 117,079 —

Proceeds from sale of future revenues, net 55,244

Proceeds from exercise of stock options 193 41 305

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Net cash provided by financing activities 56,027 118,039 1,284

Net (decrease) increase in cash, cash equivalents, and restricted cash ( 17,870 ) ( 61,997 ) 63,837

Net increase (decrease) in cash, cash equivalents, and restricted cash 7,889 ( 17,870 ) ( 61,997 )

Cash, cash equivalents, and restricted cash, beginning of period 127,529 145,399 207,396

Cash, cash equivalents, and restricted cash, end of period $ 135,418 $ 127,529 $ 145,399

Cash and cash equivalents, end of period 131,541 123,652 141,522

Restricted cash 1

3,877 3,877 3,877

Cash, cash equivalents, and restricted cash, end of period $ 135,418 $ 127,529 $ 145,399

1 As of December 31, 2024, December 31, 2023, and December 31, 2022 restricted cash of $ 3,877 , $ 3,877 , and $ 3,877 , respectively, was included in Restricted cash and other non-current assets on the Consolidated Balance Sheet

Supplemental disclosure of cash and non-cash activities:

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Cash paid in connection with operating lease liabilities 18,447 12,428 14,851

Right-of-use assets obtained in exchange of operating lease obligations 2,752 29,861 10,736

Remeasurement of operating lease liabilities and right-of-use assets due to lease modification 794 2,752 24,545

Commencement of right-of-use asset 7,844 — 5,316

Modification of right-of-use asset 2,683 — —

Issuance costs associated with the sale of future revenues included in accounts payable and accrued expenses 1,479 — —

The accompanying notes are an integral part of the consolidated financial statements.

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Editas Medicine, Inc.

(the “Company”) is a clinical stage genome editing company dedicated to developing potentially transformative genomic medicines to treat a broad range of serious diseases.

(the “Company”) is an early stage genome editing company dedicated to developing potentially transformative genomic medicines to treat a broad range of serious diseases.

The Company was incorporated in the state of Delaware in September 2013.

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Since its inception, the Company has devoted substantially all of its efforts to business planning, research and development, recruiting management and technical staff, and raising capital.

The Company has primarily financed its operations through various equity financings, payments received under a research collaboration with Juno Therapeutics, a wholly-owned subsidiary of the Bristol-Myers Squibb Company (“BMS”), payments received under a strategic alliance and option agreement with Allergan Pharmaceuticals International Limited (together with its affiliates, “Allergan”) and payments received in conjunction with the Company’s license agreement with Vertex Pharmaceuticals, Inc (“Vertex”).

The Company has primarily financed its operations through various equity financings, payments received under a research collaboration with Juno Therapeutics, Inc.

(“Juno Therapeutics”), a wholly owned subsidiary of the Bristol-Myers Squibb Company (“BMS”), payments received under its former strategic alliance with Allergan Pharmaceuticals International Limited (together with its affiliates, “Allergan”), which was terminated in August 2020, payments received under our purchase and sale agreement with DRI Healthcare Acquisitions LP, and payments received in conjunction with the Company’s license agreement with Vertex Pharmaceuticals, Inc (“Vertex”, and such agreement, the “Vertex License Agreement”).

The Company is subject to risks common to companies in the biotechnology industry, including but not limited to, risks of failure of preclinical studies and clinical trials, the need to obtain marketing approval for any drug product candidate that it may identify and develop, the need to successfully commercialize and gain market acceptance of its product candidates, dependence on key personnel, protection of proprietary technology, compliance with government regulations, development by competitors of technological innovations and ability to transition from pilot-scale manufacturing to large-scale production of products.

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

The Company also has funded its business from payments received under its license agreement with Vertex, its research collaboration with BMS and its former strategic alliance with Allergan.

The Company also has funded its business from payments received under our purchase and sale agreement with DRI Healthcare Acquisitions LP, payments received under its license agreement with Vertex, its research collaboration with BMS through its wholly owned subsidiary June Therapeutics and its former strategic alliance with Allergan (which was terminated in August 2020).

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

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

As of December 31, 2023 the Company has not sold any shares of its common stock under the ATM Facility.

In May 2021, the Company entered into a common stock sales agreement with TD Securities (USA) LLC (as successor to Cowen and Company, LLC) (“TD Cowen”), under which the Company from time to time can issue and sell shares of its 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”).

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

As of December 31, 2024 the Company has not sold any shares of its common stock under the Prior ATM Facility.

In March 2025, the Company further amended the common stock sales agreement with TD Cowen in connection with amending its shelf registration statement following the loss of its status as a “well-known seasoned issuer” (as defined under Rule 405 of the Securities Act of 1933, as amended), lowering the amount of shares of common stock it 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, the Company had not sold any shares of its common stock under the ATM Facility.

The Company has incurred annual net operating losses in every year since its inception.

The Company has an accumulated deficit of $ 1.5 billion at December 31, 2024.

As of February 28, 2024, the issuance date of the consolidated financial statements, the Company expects that its existing cash, cash equivalents and marketable securities will be sufficient to fund its operating expenses and capital expenditure requirements for at least twelve months from the issuance date of the consolidate financial statements.

As of March 5, 2025, the issuance date of the consolidated financial statements, the Company expects that its existing cash, cash equivalents and marketable securities will be sufficient to fund its operating expenses and capital expenditure requirements for at least twelve months from the issuance date of the consolidate financial statements.

The Company has never generated any product revenue.

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The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”).

Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”).

Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the ASC and Accounting Standards Updates (“ASU”) of the FASB.

Use of Estimates

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes.

On an ongoing basis, the Company’s management evaluates its estimates, which include, but are not limited to, estimates related to revenue recognition, stock-based compensation expense, the accrual for research and development expenses, valuations of in-process research and development assets and deferred tax valuation allowances.

The Company bases its estimates on historical experience and other market-specific or relevant assumptions that it believes to be reasonable under the circumstances.

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Marketable securities are classified as long-term assets on the consolidated balance sheets if the contractual maturity exceeds one year and the Company does not intend to utilize the marketable securities to fund current operations.

For the years ended December 31, 2023 and 2022, the Company’s marketable securities consisted of investments in available-for-sale debt securities and corporate equity securities.

For the years ended December 31, 2024 and 2023, the Company’s marketable securities consisted of investments in available-for-sale debt securities.

Available-for-sale debt securities are carried at fair value with the unrealized gains and losses included in accumulated other comprehensive income (loss) as a component of stockholders’ equity until realized.

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To date, the Company has not had any credit losses, and the Company did not have an allowance for credit losses as of December 31, 2024 and 2023.

The Company classified investments in equity securities that had a readily determinable fair value as marketable securities in the Company’s consolidated balance sheets.

The fair value of these securities were based on a quoted price for an identical equity security.

If the equity security had a restriction that was determined to be an attribute of the security that would transfer to a market participant, the fair value of the security was measured based on the quoted price for an otherwise identical unrestricted equity security, adjusted for the effect of the restriction.

The adjustment reflects the discount that a market participant would demand for the risk relating to the inability to dispose of the security for a specified period of time.

The Company recorded changes in the fair value of its equity securities in “Other income (expense), net” in the Company’s consolidated statement of operations.

Accounts Receivable

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The Company has no financial instruments with off-balance sheet risk such as foreign exchange contracts, option contracts, or other foreign hedging arrangements.

Financial instruments that potentially subject the Company to a concentration of credit risk are cash, cash equivalents, marketable securities and receivables owed to the Company from

collaboration partners.

The Company’s cash, cash equivalents and marketable securities are held in accounts at a financial institution that may exceed federally insured limits.

Financial instruments that potentially subject the Company to a concentration of credit risk are cash, cash equivalents, marketable securities and receivables owed to the Company from collaboration partners.

The Company’s cash, cash equivalents and marketable securities are held in accounts at a financial

institution that may exceed federally insured limits.

The Company has not experienced any credit losses in such accounts and does not believe it is exposed to any significant credit risk on these funds.

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Estimated Useful life

Labratory and manufacturing equipment 5 years

Laboratory and manufacturing equipment 5 years

Computer equipment and software 3 years

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The Company expenses patent and patent application costs and related legal costs for the prosecution and maintenance of such patents and patent applications, including patents and patent applications the Company in-licenses, as incurred, and classifies such costs as general and administrative expenses in the accompanying consolidated statements of operations.

The Company accounts for leases in accordance with ASC 842.

Liability for Sale of Future Revenues

On October 3, 2024, the Company entered into a purchase and sale agreement (the “Purchase and Sale Agreement”) with DRI Healthcare Acquisitions LP (“DRI”) under which it sold, transferred, assigned, and conveyed to DRI certain future license fees and other payments (the “Purchased Receivables”) owed to the Company by Vertex under the terms of the Vertex License Agreement in exchange for an upfront cash payment by DRI to the Company 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 the Company 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 fee increases) and a mid-double-digit percentage of a $ 50.0 million contingent upfront payment that the Company may receive under the Vertex License Agreement, in each case after subtracting amounts owing by the Company to Broad and Harvard (each term as defined in Note 8, respectively).

The Company has retained rights to certain portions of certain sales-based annual license fees and the contingent upfront payment that may become due under the Vertex License Agreement, and the amounts that correspond to its licensor obligations.

In accordance with ASC Topic 470, Borrower’s Accounting for Debt Modification , the Company has accounted for the transaction as debt.

The gross proceeds of $ 57.0 million were recorded as a liability for the sale of future revenues, net of transaction costs of $ 1.8 million, which will be amortized over the estimated life of the arrangement using the effective interest method.

The Company estimates the effective interest rate used to record non-cash interest expense under the Purchase and Sale Agreement based on the estimate of future revenue payments to be made to DRI.

As of December 31, 2024, the estimated effective interest rate under the agreement was 15.7 %.

Over the life of the arrangement, the actual effective interest rate will be affected by the amount and timing of the payments made to DRI and changes in the Company's revenue forecasts.

At each reporting date, the Company will reassess its estimate of total future payments to be made to DRI, and prospectively adjust the effective interest rate and amortization of the liability as necessary.

Refer to Note 16 for further details.

The Company accounts for leases in accordance with ASC Topic 842, Leases .

At the inception of an arrangement the Company determines whether the arrangement contains a lease.

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A lease qualifies as a finance lease if any of the following criteria are met at the inception of the lease:

(i) there is a transfer of ownership of the leased asset to the Company by the end of the lease term, (ii) the Company holds an option to purchase the leased asset that it is reasonably certain to exercise, (iii) the lease term is for a major part of the remaining economic life of the leased asset, (iv) the present value of the sum of lease payments equals or exceeds substantially all of the fair value of the leased asset, and (v) the nature of the leased asset is specialized to the point that it is expected to provide the lessor no alternative use at the end of the lease term.

the fair value of the leased asset, and (v) the nature of the leased asset is specialized to the point that it is expected to provide the lessor no alternative use at the end of the lease term.

All other leases are recorded as operating leases.

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The Company used its own historical volatility data for its estimates of expected volatility.

calculates historical volatility based on a period of time commensurate with the expected term.

The Company calculates historical volatility based on a period of time commensurate with the expected term.

The Company uses the simplified method as prescribed by the Securities and Exchange Commission’s Staff Accounting Bulletin No.

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The Company cannot predict whether any specific proposals will be enacted, the terms of any such proposals or what effect, if any, such proposals would have on the Company if they were to be enacted.

Beginning in 2022, the Tax Cut and Jobs Act of 2017 eliminates the currently available option to deduct research and development expenditures and requires taxpayers to amortize them over five years.

Congress is considering legislation that would defer the amortization requirement to future periods, however, the Company has no assurance that the provision will be repealed or otherwise modified.

Comprehensive Loss

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Segment Information

Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker in deciding how to allocate resources and assess performance.

The Company and the Company’s chief operating decision maker, the Company’s Chief Executive Officer, view the Company’s operations and manage the Company’s business as a single operating segment, which is the business of developing and commercializing genome editing technology.

Operating segments are defined as components of an enterprise about which separate discrete information is available for evaluation by the chief operating decision maker, or CODM, in deciding how to allocate resources and assess performance.

The Company and the Company’s CODM, the Company’s Chief Executive Officer, or CEO, view the Company’s operations and manage the Company’s business as a single operating segment, which is the business of developing and commercializing genome editing technology.

Recently Adopted Accounting Pronouncements

In November 2023, the FASB issues ASU 2023-07 Segment Reporting - Improvements to Reportable Segment Disclosures which amends Topic 280 by enhancing segment reporting by requiring more detailed expense information for each reportable segment.

Under the guidance, public entities are required to disclose (1) significant segment expense categories and amounts as those regularly provided to the CODM for each reportable segment and how the CODM uses the reported measures of a segment’s profit or loss to assess segment performance and decide how to allocate resources;

(2) the amount and composition of other segment items included in reported segment profit or loss, and (3) the CODM’s position and title.

Additionally, multiple measures of a segment’s profit or loss may be reported, under certain conditions, and single reportable segment entities must apply Topic 280 in its entirety.

Refer to Note 18 for additional information on the Company’s segment reporting.

The total of the reportable segment’s amount for the measure of profit or loss is to be reconciled to the public entity’s consolidated income before income taxes and discontinued operations.

The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

The Company adopted the ASU as of and for the period ended December 31, 2024.

Recently Issued Accounting Pronouncements

In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2023-09 "Income Taxes (Topic 740):

Improvements to Income Tax Disclosures." This guidance is intended to enhance the transparency and decision-usefulness of income tax disclosures.

In November 2024, the FASB issued ASU 2024-03 Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses , which is intended to improve the disclosure of expenses by providing more detailed information about the types of expenses in commonly presented expense captions.

The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027.

Early adoption is permitted.

The amendments can be applied either prospectively or retrospectively.

The Company has not early adopted this ASU and is currently evaluating the impact of this new standard on its consolidated financial statements and related disclosures.

In December 2023, the FASB issued ASU 2023-09 Income Taxes (Topic 740):

Improvements to Income Tax Disclosures .

This guidance is intended to enhance the transparency and decision-usefulness of income tax disclosures.

The amendments in ASU 2023-09 address investor requests for enhanced income tax information primarily through changes to disclosure regarding rate reconciliation and income taxes paid both in the United States and in foreign jurisdictions.

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In October 2023, the FASB issued ASU 2023-06 Disclosure Improvements:

Codification Amendments in Response to the SEC's Disclosure Update and Simplification Initiative." which incorporates certain SEC disclosure requirements into the FASB Accounting Standards Codification ("Codification").

The amendments in the ASU are expected to clarify or improve disclosure and presentation requirements of a variety Codification topics, allow investors to more easily compare entities subject to the SEC's existing disclosures with those entities that were not previously subject to the requirements, and align the requirements in the Codification with the SEC's regulations.

Codification Amendments in Response to the SEC's Disclosure Update and Simplification Initiative, which incorporates certain SEC disclosure requirements into the ASC.

The amendments in the ASU are expected to clarify or improve disclosure and presentation requirements of a variety ASC topics, allow investors to more easily compare entities subject to the SEC's existing disclosures with those entities that were not previously subject to the requirements, and align the requirements in the ASC with the SEC's regulations.

The effective date for each amendment will be the date on which the SEC's removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited.

The amendments in this ASU should be applied prospectively.

The Company doe not expect ASU 2023-06 will have a material impact to its consolidated financial statements.

The Company does not expect ASU 2023-06 will have a material impact to its consolidated financial statements.

Cash Equivalents and Marketable Securities

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Government agency securities 103,507 — — ( 327 ) 103,180

Commercial paper 29,954 — 3 ( 141 ) 29,816

Corporate notes/bonds 30,920 — — ( 86 ) 30,834

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We determined that none of our available-for-sale securities were other-than-temporarily impaired as of December 31, 2024 and 2023, and we did not hold any marketable securities that had been in an unrealized loss position for more than twelve months.

As such, the Company believes that it is more likely than not that the investments will be held until maturity or a forecasted recovery of fair value.

Based on our procedures under the expected credit loss model, including an assessment of unrealized losses in our portfolio, the Company concluded that any unrealized losses on marketable securities were not attributable to credit and, therefore, did not record an allowance for credit losses for these securities as of December 31, 2023 and 2022." As of December 31, 2023, the Company holds 23 securities with an aggregate fair value of $ 104.0 million that had remaining maturities between one and two years .

All other securities had a contractual maturity of less than a year.

As such, the Company believes that it is more likely than not that investments will be held until maturity or a forecasted recovery of fair value.

As of December 31, 2024, the Company holds no securities with remaining maturities greater than one year .

Fair Value Measurements

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Marketable securities:

Government agency securities 103,180 — 103,180 —

Corporate bonds 6,501 — 6,501 —

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Treasuries 169,469 169,469 — —

Commercial paper 29,816 — 29,816 —

Restricted cash and other non-current assets:

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Professional service expenses 1,593 750

Employee termination benefits 10,475 —

Contract termination costs 1,757 —

Other expenses 808 283

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The Company’s lease agreements have escalating rent clauses, which require higher rent payments in future years.

The Company has two significant leases for office and laboratory space located in Cambridge, Massachusetts that are summarized below.

The Company has two significant leases for office and laboratory space located in Cambridge, Massachusetts, and one significant lease for manufacturing space in Devens, Massachusetts.

The Company’s leases are included on its consolidated balance sheet as follows (in thousands):

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Operating lease liabilities, noncurrent $ ( 20,380 ) $ ( 24,372 )

During the years ended December 31, 2023, 2022 and 2021, the Company recorded $ 15.2 million, $ 13.6 million and $ 10.9 million related to operating lease costs and $ 3.3 million, $ 3.0 million and $ 2.1 million related to variable costs associated with the Company’s operating leases.

During the years ended December 31, 2024, 2023 and 2022, the Company recorded $ 21.0 million, $ 15.2 million and $ 13.6 million of expense related to operating lease costs and $ 2.8 million, $ 3.3 million and $ 3.0 million related to variable costs associated with the Company’s operating leases.

Maturities of the Company’s lease liabilities as of December 31, 2024 were as follows (in thousands):

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2025 $ 17,143

Thereafter $ —

Total minimum lease payments $ 39,947

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The weighted-average remaining lease term is 2.9 years and the weighted-average discount rate is 9.1 %.

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

As of December 31, 2023, the lease has 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.

The Company may terminate the license and service agreement in the Company's discretion upon twelve months' prior written notice.

Hurley Street

In 2016, the Company entered into a lease agreement for 59,783 square feet of office and laboratory space located on Hurley Street in Cambridge, Massachusetts.

The term of the lease began on October 1, 2016 and continues until October 2028.

In November 2022, the Company entered into an amendment to the lease agreement to extend the term of its existing facility space to October 31, 2028 under the same terms as its existing agreement except for the terms of payment.

As a result of this amendment, the Company recognized an additional right-of-use asset and corresponding lease liability of $ 24.6 million.

In connection with the lease and as a security deposit, the Company holds, with the landlord, a letter of credit in the amount of approximately $ 1.6 million.

Subject to the terms of the lease and certain reduction requirements specified therein, the $ 1.6 million security deposit may decrease over time.

The letter of credit, which is collateralized by the Company, is recorded in restricted cash and other non-current assets in the accompanying consolidated balance sheets as of December 31, 2023 and December 31, 2022.

One Main Street

In 2019, the Company entered into a lease agreement for 31,571 square feet of office space located on One Main Street in Cambridge, Massachusetts.

The term of the lease began on January 15, 2020 and continues until January 2025.

In connection with the lease and as a security deposit, the Company issued a letter of credit in the amount of approximately $ 0.8 million.

The Company has the option to extend the lease for an additional five-year term at market-based rates.

The base rent payments commenced in January 2020 and continue through the term of the lease and are subject to increases over the term of the lease.

Commitments and Contingencies

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Broad Sponsored Research Agreement

In 2018, the Company entered into a sponsored research agreement (the “Sponsored Research Agreement”) with The Broad Institute, Inc.

In 2018, the Company entered into a sponsored research agreement, which was amended in January 2021 (as amended, the “Sponsored Research Agreement”) with The Broad Institute, Inc.

The Sponsored Research Agreement provides for Broad to conduct research useful or relevant to genome editing in the field of genomic medicines for the prevention or treatment of human disease with funding from the Company.

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In aggregate, the Company has triggered $ 25.0 million in Market Cap Research Funding and has primarily settled these amounts through the issuance of shares of its common stock.

The remaining $ 100.0 million in Market Cap Research Funding may be triggered when the Company’s market capitalization reaches various low- ten to eleven dollar amounts or in the event of a Company sale.

The remaining $ 100.0 million in Market Cap Research Funding may be triggered when the Company’s market capitalization reaches various low- ten to eleven figure dollar amounts or in the event of a Company sale.

The Company is not required to make additional Market Cap Research Funding payments if the Company, whether directly or through its affiliates or sublicensees, is not researching, developing, or commercializing products based on or incorporating inventions exclusively licensed to the Company from Broad subject to certain exclusions.

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The Company has entered into agreements with Broad and the President and Fellows of Harvard College (“Harvard”) to license certain patent rights owned or co-owned by the institutions.

The foundational patent rights that were in-licensed by the Company include Cas9-I (“Cas9-I License Agreement”), Cas12a (formerly known as Cpf1) (“Cpf1 License Agreement”), and Cas9-II (“Cas9-II License Agreement”) (collectively referred to herein as the “License Agreements”).

The foundational patent rights that were in-licensed by the Company include Cas9-I (as amended and restated to date, the “Cas9-I License Agreement”), Cas12a

(formerly known as Cpf1) (as amended, the “Cpf1 License Agreement”), and Cas9-II (as amended, the “Cas9-II License Agreement”) (collectively referred to herein as the “License Agreements”).

The Company received exclusive, worldwide, royalty-bearing, sublicensable licenses to certain patent rights to develop and commercialize licensed product and a non-exclusive, worldwide, royalty-bearing sublicensable license under the same patent rights for all other purposes, subject to certain limitations and retained rights.

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The Company has the right to terminate each of the License Agreements at will with four months written notice to Broad.

Unless terminated earlier, the term of each of the License

Agreements will expire on a country-by-country basis, upon the expiration of the last to expire valid claim of the licensed patent rights in such country.

Unless terminated earlier, the term of each of the License Agreements will expire on a country-by-country basis, upon the expiration of the last to expire valid claim of the licensed patent rights in such country.

In aggregate, the Company may pay up to $ 14.8 million, $ 20.0 million, and $ 3.7 million in clinical and regulatory milestones under the Cas9-I License Agreement, Cpf1 License Agreement, and Cas9-II License Agreement, respectively.

In addition, the Company owes aggregate sales milestones totaling $ 54.0 million, $ 54.0 million, and $ 13.5 million under the Cas9-I License Agreement, Cpf1 License Agreement, and Cas9-II License Agreement, respectively.

If the licensed product or service prevents or treats a human disease that afflicts fewer than a specified number of patients in the aggregate in the United States (“U.S.”) or a specified number of patients per year in the U.S., the clinical and regulatory milestones reduce to $ 4.1 million, $ 5.5 million, and $ 1.1 million under the Cas9-I License Agreement, Cpf1 License Agreement, and Cas9-II License Agreement, respectively.

If the licensed product or service prevents or treats a human disease that afflicts fewer than a specified number of patients in the aggregate in the U.S.

or a specified number of patients per year in the U.S., the clinical and regulatory milestones reduce to $ 4.1 million, $ 5.5 million, and $ 1.1 million under the Cas9-I License Agreement, Cpf1 License Agreement, and Cas9-II License Agreement, respectively.

In addition, the aggregated sales milestones reduce to $ 36.0 million, $ 36.0 million, and $ 9.0 million under the Cas9-I License Agreement, Cpf1 License Agreement, and Cas9-II License Agreement, respectively.

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Under the Cpf1 License Agreement and Cas9-II License Agreement, the Company is obligated to make payments (“Success Payments”) in the event the Company’s market capitalization reaches certain thresholds for a specified period of time, or in the event of a change in control of the Company, if the consideration is in excess of those thresholds.

Unless the Company has undergone a change in control, Success Payments are payable by the Company in cash or in the form of promissory notes, which may be settled in shares of common stock at the election of the Company.

Unless the Company has undergone a change in control, Success Payments are payable by the Company in cash, shares of the Company’s common stock, or in the form of promissory notes, which may be settled in shares of common stock at the election of the Company.

In the event of a change in control of the Company, the Success Payments are required to be paid in cash.

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Deferred revenue $ 68,888 $ — $ ( 8,463 ) $ 60,425

BMS Collaboration Agreement

In 2019, the Company entered into an amended and restated collaboration agreement (“BMS Collaboration Agreement”) and license agreement (“BMS License Agreement”) with BMS to focus on the research, development, and commercialization of autologous and allogenic alpha-beta T cell medicines for the treatment of all diseases, subject to certain exceptions.

The Company and BMS started their collaboration in 2015 and have amended the agreement twice.

The Company received a $ 70.0 million up-front, non-refundable, non-creditable cash payment (“Amendment Fee”) in connection with the execution of the 2019 amendment.

The Company may develop genome editing tools, specific to a gene target and enzyme combination (or a “Program”) that, following the exercise of its option and the Company’s grant of a license, BMS may use in its development of gene edited alpha-beta T-cell therapies and certain other T-cell derived from pluripotent stem cells or any other precursor cell for the treatment of all diseases, subject to certain exceptions (the “BMS Field”).

To assess the Programs prior to opt-in, the Company granted BMS a non-exclusive perpetual research license in the BMS Field.

If BMS exercises their option to the Program, they receive an exclusive, worldwide, development and commercialization license in the BMS Field for a nominal option exercise fee.

The BMS License Agreement provided that the Company would manufacture clinical grade materials through a Phase 1 clinical trial if requested by BMS at an incremental cost to be negotiated by the parties.

However, BMS has sole responsibility, at its own cost, for the worldwide research, development, manufacturing, and commercialization of its products.

They must use commercially reasonable efforts and meet certain regulatory and commercial diligence requirements.

The first development and commercialization license was delivered to BMS at the onset of the amended arrangement for which the Company received $ 0.5 million in consideration for the license (the “First Development and Commercialization License).

On a product-by-product basis, the Company is eligible to receive up to $ 27.5 million in development milestones and $ 107.5 million in regulatory milestones.

The Company is also eligible to receive up to an aggregate of $ 60.0 million for the first two licensed products to reach certain sales milestones.

The Company is entitled to a high-single digit to low double-digit percentage of royalties on net sales of licensed products, subject to reductions in certain circumstances, through the later of the expiration of the patent(s) related to the licensed products or six years post-first commercial sale of such licensed products.

The amended term of the BMS Collaboration Agreement is five years , which is subject to two one-year extension periods.

During the term, including the extension periods, the Company may not alone, or with a third party, research, develop, manufacture, or commercialize a product in the BMS Field.

BMS has the right to terminate the BMS Collaboration Agreement at any time upon no less than six months prior written notice.

Per the termination provisions of the BMS License Agreement, BMS has the right to terminate the License Agreement either on a licensed product-by-product basis or in its entirety for any reason at any time upon ninety days prior written notice.

If BMS terminates the license agreement without cause, the exclusive licenses granted to BMS automatically revert back to the Company.

During the years ended December 31, 2024 and 2023, the Company recognized the following collaboration revenue (in thousands):

Revenue recognized in the period from:

December 31, 2024 December 31, 2023

Amounts included in deferred revenue at the beginning of the period $ 8,463 $ —

Performance obligations satisfied in previous periods $ — $ —

Amendment to BMS Collaboration Agreement

In March 2024, the Company entered into an amendment (“2024 Amendment”) to the Second Amended and Restated Collaboration and License Agreement, dated as of November 11 2019, by and between the Company and Juno Therapeutics (the “2019 Collaboration Agreement”) extend the collaboration to November 2026, with options to extend the collaboration for up to an additional two years , and provided BMS the ability to select up to three new gene targets for research.

Accounting Assessment

The Company concluded that the BMS Collaboration Agreement and the BMS License Agreement qualify as a contract with a customer under ASC 606 as one combined arrangement.

The Company evaluated the 2024 Amendment and concluded that the agreement qualifies as a contract with a customer under ASC 606.

The contract modification was accounted for on a prospective basis as if it were a termination of the existing contract and the creation of a new contract since the promised goods and services were distinct from the goods and services that were transferred on or before the effective date of the amendment.

The Company identified the following performance obligations:

(i) First Development and Commercialization License and (ii) seventeen material rights for additional development and commercialization licenses for other Programs.

The Company also evaluated the (i) the research license, (ii) contract term extensions, (iii) clinical supply arrangement, (iv) participation by employees on the oversight committee, alliance and technology transfer teams and (v) certain intellectual property rights and concluded that none of these met the definition of a performance obligation as a result of the promise being quantitively and qualitatively immaterial in the context of the arrangement or the promise did not convey a material right to BMS.

The Company also concluded that there was not an implicit promise to perform research and development services.

As of December 31, 2023 the total transaction price was approximately $ 118.0 million comprised of the following:

(i) $ 70.0 million Amendment Fee, (ii) $ 32.0 million in remaining deferred revenue balance that was not recognized pursuant the 2018 amendment agreement (iii) $ 6.0 million related to option exercise fees for delivered licenses and (iv) $ 10.0 million related to development milestone payments that were received by the Company.

The Company has identified the following performance obligations under the 2024 Amendment:

eighteen material rights for additional development and commercialization licenses for other gene editing tools specific to a gene target and enzyme combination (or a “Program”).

As of December 31, 2024 the total transaction price was approximately $ 56.7 million, comprised of the remaining deferred revenue balance that was not recognized pursuant to the 2019 Amended Collaboration Agreement.

The Company utilized the most likely amount method to estimate any development and regulatory milestone payments to be received, as well as extension term fees.

As of December 31, 2024, there were no milestone or extension term fees included in the transaction price.

The Company considers the stage of development and the risks associated with the remaining development required to achieve the milestone, as well as whether the achievement of the milestone is outside the control of the Company or BMS.

The outstanding milestone payments and extension term fees were fully constrained as of December 31, 2024, as a result of the uncertainty of whether any of the milestones will be achieved or the term would be extended.

The assessment of the constraint utilizing the most likely amount method considers the stage of development and the risks associated with the remaining development required to achieve the milestones, as well as whether the achievement of the milestone is outside the control of the Company or BMS.

The Company has determined that any commercial milestones and sales-based royalties will be recognized when the related sales occur.

The Company reevaluates the transaction price at the end of each reporting period and as uncertain events are resolved or other changes in circumstances occur.

The Company reevaluates the transaction price at each reporting period and as uncertain events are resolved or other changes in circumstances occur.

The Company concluded that rights and attributes of each of the development and commercialization licenses are identical for both the license granted at inception and the licenses that may be issued in the future upon exercise of the associated option.

Each development and commercialization license is differentiated only by the Program to which it relates.

The Company has considered the early stage of the science and the uncertainty of success and concluded that the probability of scientific success and opt-in is equal amongst all Programs.

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As of December 31, 2024, the Company recorded $ 50.2 million of deferred revenue, of which $ 50.2 million is classified as long-term on the Company's consolidated balance sheets.

There were no material sublicense fees paid to licensors in connection with the consideration received pursuant to the BMS Collaboration Agreement for the years ended December 31, 2023 and 2022.

Beam Therapeutics License Agreement

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(“Beam,” and such agreement, the “Beam License Agreement”).

Pursuant to the Beam License Agreement, the Company granted to Beam a worldwide, exclusive (subject to certain exceptions), sublicensable (subject to certain conditions), development and commercialization license under certain intellectual property controlled by the Company for the use of base editing therapies for the treatment of any field of human diseases and conditions, such to certain exceptions.

Pursuant to the Beam License Agreement, the Company granted to Beam a worldwide, exclusive (subject to certain exceptions), sublicensable (subject to certain conditions), development and

commercialization license under certain intellectual property controlled by the Company for the use of base editing therapies for the treatment of any field of human diseases and conditions, such to certain exceptions.

Additionally, the Company granted Beam a non-exclusive research license.

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Vertex Pharmaceuticals License Agreement

On December 12, 2023, the Company and Vertex Pharmaceuticals entered into a license agreement.

On December 12, 2023, the Company and Vertex entered into a license agreement.

Under terms of the agreement, Vertex obtained a non-exclusive license for Editas Medicine’s Cas9 gene editing technology for ex vivo gene editing medicines targeting the BC11A gene in the fields of sickle cell disease and beta thalassemia, including exagamglogene autotemcel (exa-cel).

In connection with the License Agreement, the Company received an upfront payment of $ 50.0 million.

The Company is 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 and other contingent fees of $ 50.0 million.

In connection with the license agreement License Agreement, the Company received an upfront payment of $ 50.0 million.

The Company is also eligible to receive annual license fees ranging from $ 10.0 million to $ 40.0 million annually, inclusive of certain fixed and sales-based annual license fee increases, through 2034 and other contingent fees of $ 50.0 million.

Accounting Assessment

The Company assessed this arrangement in accordance with Topic 606 and concluded that the contract counterparty, Vertex Pharmaceuticals, is a customer.

The Company assessed this arrangement in accordance with Topic 606 and concluded that the contract counterparty, Vertex, is a customer.

The Company identified a single performance obligation, which is the non-exclusive license to certain Cas9-I patents.

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Since the single performance obligation was delivered at the inception of the arrangement and the license was made available for Vertex’s use and benefit, the Company recognized the total transaction price at the inception of the agreement.

During the year ended December 31, 2023, the Company recognized revenue under the Vertex License Agreement of $ 60.0 million.

During the years ended December 31, 2024 and 2023, the Company recognized revenue under the Vertex License Agreement of $ 10.0 million and $ 60.0 million, respectively.

Preferred Stock

The Company’s amended and restated certificate of incorporation authorized 5,000,000 shares of undesignated preferred stock that may be issued from time to time by the Company’s board of directors in one or more series.

The Company’s amended and restated certificate of incorporation authorized 5,000,000 shares of undesignated preferred stock that may be issued from time to time by the Board in one or more series.

As of December 31, 2024, the Company had no shares of preferred stock issued or outstanding.

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The holders of shares of common stock are entitled to one vote for each share of common stock held at any meeting of stockholders and at the time of any written action in lieu of a meeting.

The holders of shares of common stock are entitled to receive dividends, if and when declared by the Company’s board of directors.

The holders of shares of common stock are entitled to receive dividends, if and when declared by the Board.

Cash dividends may not be declared or paid to holders of shares of common stock until all unpaid dividends on any outstanding redeemable convertible preferred stock have been paid in accordance with their terms.

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Certain options provide for accelerated vesting in the event of a change in control, as defined in the applicable options.

Awards granted to non-employee consultants generally vest monthly over a period of one

to four years .

In connection with the Company’s initial public offering (“IPO”), the Company’s board of directors determined to grant no further awards under the 2013 Plan.

Awards granted to non-employee consultants generally vest monthly over a period of one to four years .

In connection with the Company’s initial public offering (“IPO”), the Board determined to grant no further awards under the 2013 Plan.

2015 Stock Incentive Plan

The Company’s board of directors adopted and the Company’s stockholders approved the 2015 stock incentive plan (the “2015 Plan”).

The 2015 Plan provides for the grant of incentive stock options, nonstatutory stock options, restricted stock awards, restricted stock units, stock appreciation rights and other stock-based awards.

The Board adopted and the Company’s stockholders approved the 2015 stock incentive plan (the “2015 Plan”).

The 2015 Plan provides for the grant of incentive stock options, nonstatutory stock options, restricted stock awards,

restricted stock units, stock appreciation rights and other stock-based awards.

The Company’s employees, officers, directors and consultants and advisors are eligible to receive awards under the 2015 Plan.

The number of shares reserved for issuance under the 2015 Plan is subject to further increases for (a) any additional shares of the Company’s common stock subject to outstanding awards under the 2013 Plan that expire, terminate, or are otherwise surrendered, cancelled, forfeited, or repurchased by the Company at their original issuance price pursuant to a contractual repurchase right and (b) annual increases, to be added as of the first day of each fiscal year, from January 1, 2017 until, and including, January 1, 2026, equal to the lowest of 2,923,076 shares of common stock, 4 % of the number of shares of common stock outstanding on such first day of the fiscal year in question and an amount determined by the Company’s board of directors.

In January 2024, the shares under the 2015 Plan increased by 3,270,691 shares pursuant to the annual increase described in the prior sentence.

In January 2025, the remaining shares reserved but unissued under the 2015 Plan increased to 12,248,887 shares pursuant to the annual increase described in the prior sentence.

2015 Employee Stock Purchase Plan

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Inducement Awards

From time to time the Company’s board of directors approves inducement awards to certain employees outside of the existing equity compensation plans in connection with such employees commencing employment with the Company.

From time to time the Board approves inducement awards to certain employees outside of the existing equity compensation plans in connection with such employees commencing employment with the Company.

Inducement awards are typically a service-based option and a restricted stock unit and are subject to the Company’s typical vesting terms and the employee’s continued service relationship with the Company through the applicable vesting dates.

In May 2023, July 2023 and September 2023, the Company’s board of directors approved three inducement grants to the Company’s recently hired Chief Financial Officer, Chief Scientific and Chief Commercial and Strategy Officer, respectively.

In May 2023, July 2023 and September 2023, the Board approved three inducement grants to the Company’s recently hired Chief Financial Officer, Chief Scientific and Chief Commercial and Strategy Officer, respectively.

Shares Reserved for Future Issuance

As of December 31,

Shares reserved for outstanding stock option awards under the 2013 Stock Incentive Plan, as amended 115,942 143,055

Shares reserved for outstanding stock option awards and restricted stock units under the 2015 Stock Incentive Plan 6,450,615 5,253,299

Shares reserved for outstanding stock option awards under the 2013 Plan, as amended 114,108 115,942

Shares reserved for outstanding stock option awards and restricted stock units under the 2015 Plan 8,395,995 6,450,615

Shares reserved for outstanding inducement stock option award and restricted stock units 1,536,461 1,690,235

Remaining shares reserved, but unissued, for future awards under the 2015 Stock Incentive Plan 9,100,247 7,812,540

Remaining shares reserved, but unissued, for future awards under the 2015 Employee Stock Purchase Plan 3,185,493 3,300,853

Remaining shares reserved, but unissued, for future awards under the 2015 Plan 9,673,426 9,100,247

Remaining shares reserved, but unissued, for future awards under the 2015 ESPP 2,972,026 3,185,493

22,692,016 20,542,532

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The restricted stock and restricted stock units granted in the year ended December 31, 2024 include 422,000 units granted to certain employees that contain performance-based vesting provisions.

The expense related to the performance-based vesting of restricted stock units was $ 0.5 million and $ 4.4 million for the years ended December 31, 2023 and December 31, 2022, respectively.

The expense related to the performance-based vesting of restricted stock units was $ 3.5 million, $ 0.5 million and $ 4.4 million for the years ended December 31, 2024, 2023 and 2022, respectively.

As of December 31, 2024, total unrecognized compensation expense related to unvested restricted stock and restricted stock unit awards was $ 12.2 million, which the Company expects to recognize over a remaining weighted-average period of 2.3 years.

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Other — % 1.3 %

( 0.1 ) % — %

The principal components of the Company’s deferred tax assets and liabilities consist of the following at December 31, 2024 and 2023 (in thousands):

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Depreciation and amortization 978 905

Stock compensation 10,431 7,323

Other 14,976 —

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For taxable years beginning after December 31, 2021, the Tax Cuts and Jobs Act (the "Tax Act”) eliminated the option to deduct research and development expenditures in the current year and requires taxpayers to capitalize such expenses pursuant to Internal Revenue Code ( "IRC" ) Section 174.

As a result of this provision of the Tax Act, deferred tax assets related to capitalized research expenses pursuant to IRC Section 174 increased to $ 60.9 million for the year ended December 31, 2023.

As a result of this provision of the Tax Act, deferred tax assets related to capitalized research expenses pursuant to IRC Section 174 was $ 84.7 million for the year ended December 31, 2024.

The Company has incurred net operating losses (“NOL”) since inception.

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NOL and tax credit carryforwards may become subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant shareholders over a three-year period in excess of 50%, as defined under Sections 382 and 383 of the Code, respectively, as well as other similar state provisions.

The Company conducted an analysis under Section 382 to determine if historical changes in ownership through December 31, 2019 would limit or otherwise restrict its ability to utilize its NOL and research and development credit carryforwards.

The Company conducted an analysis under Section 382 to determine if historical changes in ownership through June 30, 2024 would limit or otherwise restrict its ability to utilize its NOL and research and development credit carryforwards.

As a result of this analysis, the Company does not believe there are any significant limitations on its ability to utilize these carryforwards.

However, future changes in ownership occurring after December 31, 2019 could affect the limitation in future years, and any limitation may result in expiration of a portion of the NOL or research and development credit carryforwards before utilization.

However, future changes in ownership occurring after June 30, 2024 could affect the limitation in future years, and any limitation may result in expiration of a portion of the NOL or research and development credit carryforwards before utilization.

Management has evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets, which principally comprise of NOL carryforwards, research and development credit carryforwards and capitalized license and patent costs.

The Company’s management has determined that it is more likely than not that the Company will not recognize the benefits of its federal and state deferred tax assets, and as a result, a valuation allowance of $ 328.6 million and $ 296.1 million has been established at December 31, 2023 and 2022, respectively.

The increase in the valuation

allowance of $ 32.5 million for the year ended December 31, 2023 was primarily due to current period pre-tax losses incurred and research tax credits generated.

million and $ 328.6 million has been established at December 31, 2024 and 2023, respectively.

The increase in the valuation allowance of $ 60.3 million for the year ended December 31, 2024 was primarily due to current period pre-tax losses incurred and research tax credits generated.

The Company applies ASC 740 related to accounting for uncertainty in income taxes.

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Thus, there would be no impact to the consolidated balance sheets or statements of operations if an adjustment were required.

The Company files income tax returns in the U.S.

federal tax jurisdiction, the Massachusetts state jurisdiction, the California state jurisdiction and the Colorado state jurisdiction.

The Company files income tax returns as prescribed by the tax laws of the jurisdictions in which it operates.

In the normal course of business, the Company is subject to examination by federal and state jurisdictions, where applicable.

Since the Company is in a loss carryforward position, the Company is generally subject to examination by the U.S.

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The table above reflects restricted stock issued upon exercise of unvested stock options as exercised on the dates that the shares are no longer subject to repurchase.

Liability for the Sale of Future Revenues

The following table presents the changes in the liability related to the sale of future revenues under the Purchase and Sale Agreement with DRI as of December 31, 2024 (in thousands):

December 31, 2024

Proceeds from sale of future revenues $ 57,000

Issuance costs ( 1,756 )

Non-cash interest expense associated with sale of future revenues 2,128

Amortization of issuance costs 62

Deferred royalty obligation related to the sale of future revenues net $ 57,434

Restructuring

On December 11, 2024, the Board approved the discontinuation of the clinical development of the Company's reni-cel program (the “Discontinuation”) to treat sickle cell disease and transfusion-dependent beta thalassemia.

As a result of the Discontinuation, the Company has ceased activities towards the filing of a biologic license application and potential commercialization of reni-cel.

In connection with the Discontinuation, the Board also approved a reduction in the Company’s employee workforce by approximately 180 positions, or approximately 65 % (the “Reduction”).

As a result of these events, the Company incurred the following restructuring charges for the year ended December 31, 2024 in accordance with ASC 420 - Exit or Disposal Cost Obligations and ASC 712 Compensation - Non-retirement Postemployment Benefits , which are recorded in the consolidated statement of operations (in thousands):

Employee termination benefits $ 10,475

Contract termination costs 1,757

Restructuring charges $ 12,232

The actions associated with the Discontinuation and Reduction commenced in December 2024 and are expected to be substantially completed by the end of June 2025.

In addition to the items discussed within this note, the Company anticipates that as part of the Discontinuation, it will incur impairment charges in the range of $ 11.0 million to $ 14.0 million for the related right of use asset and property and equipment.

Employee Termination Benefits

Employees affected by the Reduction obtained involuntary termination benefits that are provided pursuant to either a one-time benefit or arrangement or salary continuation for a set period of time in accordance with the Company’s

Amended and Restated Severance Benefit Plan (the “Benefit Plan”).

For employees who were notified of their termination in December 2024 and have no requirements to provide future services or were subject to the Benefit Plan, the Company recognized the liability for the termination benefits in full at fair value in the fourth quarter of 2024.

For employees who are required to render services beyond a minimum retention period to receive their one-time termination benefits or salary continuation, the Company is recognizing the termination benefits ratably over their future service periods.

The service periods began in December 2024 and all will end at various dates throughout 2025.

The following table shows the liability related to employee termination benefits as of December 31, 2024 (in thousands):

Employee Termination Benefits

Accrued employee termination benefits beginning balance $ —

Employee termination benefits charges incurred during period 10,475

Amounts paid or otherwise settled during the period —

Accrued employee termination benefits as of December 31, 2024

In total, the Company expects that it will incur approximately $ 14.9 million of employee termination benefit expense to implement the Reduction.

Contract Termination Costs

The Discontinuation resulted in contract termination costs from vendor contracts before the end of their term, as well as costs that continue to be incurred under certain contracts with no future economic benefit to the Company.

In accordance with ASC 420, the Company recognized these unavoidable contract termination costs when incurred or when it has been determined that there is no future economic benefit to the Company, as it relates to costs that continue to be incurred.

The following table shows the liability related to contract termination costs as of December 31, 2024 (in thousands):

Contract Termination Costs

Accrued contract termination costs $ —

Contract termination costs incurred during the period 1,757

Amounts paid or otherwise settled during the period —

Accrued contract termination costs as of December 31, 2024

In total, the Company anticipates incurring $ 30.0 million to $ 40.0 million in costs related to the completion of the Discontinuation.

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the CODM or decision-making group in making decisions on how to allocate resources and assess performance.

The Company’s CODM is its CEO.

The CEO views the Company’s operations and manages the Company’s business as one operating segment, which is the business of developing and commercializing genome editing technology.

The Company’s CEO manages and allocates resources to the operations of the Company on a total company basis by assessing the overall level of resources available and how to best deploy these resources across functions and research and development projects that are in line with our long-term company-wide strategic goals.

In making these decisions, the Company’s CEO uses consolidated financial information for purposes of evaluating performance, forecasting future period financial results, allocating resources and setting incentive targets.

The CODM performs this assessment based on the Company’s consolidated net loss.

Through this analysis, the CODM assesses performance by comparing actual

consolidated net loss versus the budget, and then decides how to allocate resources to invest in the Company’s research and development programs.

The measure of segment assets is reported on the consolidated balance sheet as total assets.

The following table contains additional information on our consolidated revenue and net loss, including significant segment expenses (in thousands):

2024 2023 2022

Collaboration and other research and development revenues $ 32,314 $ 78,123 $ 19,712

Operating expenses:

Research and development 1

Employee related expenses 61,136 47,363 47,320

External research and development expenses 79,900 53,321 79,822

Facility expenses 26,430 21,447 21,032

Stock-based compensation expenses 8,642 9,842 12,425

Sublicense and license fees 18,953 35,011 5,334

Other expenses 3

12,768 10,667 9,025

General and administrative 2

Employee related expenses 24,335 16,969 17,321

Professional service expenses 14,358 19,575 11,496

Intellectual property and patent related fees 14,016 13,268 14,784

Stock-based compensation expenses 12,775 9,956 16,869

Facility and other expenses 4

10,153 9,885 10,234

Total operating expenses 283,466 247,304 245,662

Operating loss ( 251,152 ) ( 169,181 ) ( 225,950 )

Other income, net:

Other expense, net ( 3 ) ( 1,604 ) —

Interest income, net 14,062 17,566 5,518

Total other income, net 14,059 15,962 5,518

Net loss $ ( 237,093 ) $ ( 153,219 ) $ ( 220,432 )

1 For the years ended December 31, 2024, 2023, and 2022 includes $ 8,582 , $ 0 , and $ 0 of restructuring charges, respectively

2 For the years ended December 31, 2024, 2023, and 2022 includes $ 3,650 , $ 0 , and $ 0 of restructuring charges, respectively

3 Other expenses primarily consists of consultant fees and office expenses

4 Facility and other expenses primarily consists of rent expense, insurance premiums, software licenses and office expenses

For the year ended December 31, 2024, there were two customers for which revenues amount to 10% or more of the Company’s consolidated collaboration and other research and development revenues, representing $ 18.1 million and $ 10.0 million of the Company’s consolidated collaboration and other research and development revenues.

For the year ended December 31, 2023, there was one customer for which revenues amounts to 10% or more of the Company’s consolidated collaboration and other research and development revenues, representing $ 60.0 million of the Company’s consolidated collaboration and other research and development revenues.

For the years ended December 31, 2024 and 2023, 100 % and 100 %, respectively, of the Company’s consolidated collaboration and other research and development revenues was attributed to the U.S.

Subsequent Events

The Company evaluated subsequent events after the audited balance sheet date of December 31, 2024 but prior to the issuance of the financial statements to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure.

The Company did not identify any subsequent events requiring further disclosure.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

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 7A. Quantitative and Qualitative Disclosures About Market Risk