Editas Medicine, Inc. 10-Q

Item 1. Financial Statements. Editas Medicine, Inc. Condensed Consolidated Balance Sheets (unaudited) (amounts in thousands, except share and per share data) March 31, 2025 December 31, 2024 ASSETS Current assets: Cash and cash equivalents $ 138,692 $ 131,541 Marketable securities 82,272 138,372 Accounts receivable 510 16,266 Prepaid expenses and other current assets 3,369 3,136 Total current assets 224,843 289,315 Property and equipment, net 8,182 14,497 Right-of-use assets 26,429 32,554 Restricted cash and other non-current assets 4,198 5,223 Total assets $ 263,652 $ 341,589 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 5,465 $ 5,493 Accrued expenses 47,488 45,859 Liability for sale of future revenues, current 5,000 5,000 Deferred revenue, current 2,000 6,221 Operating lease liabilities 13,161 14,652 Total current liabilities 73,114 77,225 Operating lease liabilities, net of current portion 17,972 20,380 Liability for sale of future revenues - non-current 49,579 52,434 Deferred revenue, net of current portion 54,204 54,204 Other non-current liabilities 6,363 3,072 Total liabilities 201,232 207,315 Stockholders’ equity Preferred stock, $ 0.0001 par value per share: 5,000,000 shares authorized; no shares issued or outstanding — — Common stock, $ 0.0001 par value per share: 195,000,000 shares authorized; 83,709,536 and 82,734,696 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively 8 8 Additional paid-in capital 1,606,855 1,602,441 Accumulated other comprehensive income 88 268 Accumulated deficit ( 1,544,531 ) ( 1,468,443 ) Total stockholders’ equity 62,420 134,274 Total liabilities and stockholders’ equity $ 263,652 $ 341,589 The accompanying notes are an integral part of the condensed consolidated financial statements. 3 Table of Contents Editas Medicine, Inc. Condensed Consolidated Statements of Operations (unaudited) (amounts in thousands, except share and per share data) Three Months Ended March 31, 2025 2024 Collaboration and other research and development revenues $ 4,658 $ 1,135 Operating expenses: Research and development 26,593 48,787 General and administrative 13,375 19,339 Restructuring and impairment charges 40,853 — Total operating expenses 80,821 68,126 Operating loss ( 76,163 ) ( 66,991 ) Other income, net: Other (expense) income, net ( 425 ) 6 Interest related to sale of future revenues ( 2,216 ) — Interest income, net 2,716 5,035 Total other income, net 75 5,041 Net loss $ ( 76,088 ) $ ( 61,950 ) Net loss per share, basic and diluted $ ( 0.92 ) $ ( 0.76 ) Weighted-average common shares outstanding, basic and diluted 83,055,066 81,938,839 The accompanying notes are an integral part of the condensed consolidated financial statements. 4 Table of Contents Editas Medicine, Inc. Condensed Consolidated Statements of Comprehensive Loss (unaudited) (amounts in thousands) Three Months Ended March 31, 2025 2024 Net loss $ ( 76,088 ) $ ( 61,950 ) Other comprehensive loss: Unrealized loss on marketable debt securities ( 180 ) ( 524 ) Comprehensive loss $ ( 76,268 ) $ ( 62,474 ) The accompanying notes are an integral part of the condensed consolidated financial statements. 5 Table of Contents Editas Medicine, Inc. Condensed Consolidated Statements of Stockholders’ Equity (unaudited) (amounts in thousands, except share data) Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Income (Loss) Accumulated Deficit Total Stockholders’ Equity Shares Amount Balance at December 31, 2024 82,734,696 $ 8 $ 1,602,441 $ 268 $ ( 1,468,443 ) $ 134,274 Issuance of common stock from at the market equity offering 706,236 — 1,435 — — $ 1,435 Vesting of restricted common stock awards 268,604 — — — — — Stock-based compensation expense — — 2,979 — — 2,979 Unrealized loss on marketable debt securities — — — ( 180 ) — ( 180 ) Net loss — — — — ( 76,088 ) ( 76,088 ) Balance at March 31, 2025 83,709,536 $ 8 $ 1,606,855 $ 88 $ ( 1,544,531 ) $ 62,420 Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total Stockholders’ Equity Shares Amount Balance at December 31, 2023 81,767,263 $ 8 $ 1,580,241 $ 198 $ ( 1,231,350 ) $ 349,097 Exercise of stock options 21,975 — 192 — — 192 Vesting of restricted common stock awards 445,713 — — — — — Stock-based compensation expense — — 7,585 — — 7,585 Unrealized loss on marketable debt securities — — — ( 524 ) — ( 524 ) Net loss — — — — ( 61,950 ) ( 61,950 ) Balance at March 31, 2024 82,234,951 $ 8 $ 1,588,018 $ ( 326 ) $ ( 1,293,300 ) $ 294,400 The accompanying notes are an integral part of the condensed consolidated financial statements. 6 Table of Contents Editas Medicine, Inc. Condensed Consolidated Statements of Cash Flows (unaudited) (amounts in thousands) Three Months Ended March 31, 2025 2024 Cash flow from operating activities Net loss $ ( 76,088 ) $ ( 61,950 ) Adjustments to reconcile net loss to net cash used in operating activities: Stock-based compensation expense 2,979 7,585 Depreciation 1,917 1,409 Net amortization of premiums and discounts on marketable securities ( 583 ) ( 1,716 ) Other non-cash items 492 — Impairment of held for sale assets 3,724 — Interest related to sale of future revenues 2,145 — Changes in operating assets and liabilities: Accounts receivable 15,756 9,942 Prepaid expenses and other current assets 70 ( 1,607 ) Right-of-use assets 6,125 2,237 Other non-current assets 1,025 ( 899 ) Accounts payable ( 27 ) ( 1,456 ) Accrued expenses 1,693 ( 2,694 ) Accrued interest on sale of future revenues ( 2,128 ) — Deferred revenue ( 4,221 ) — Operating lease liabilities ( 3,899 ) ( 2,396 ) Other non-current liabilities 3,221 1,673 Net cash used in operating activities ( 47,799 ) ( 49,872 ) Cash flow from investing activities Purchases of property and equipment ( 114 ) ( 1,871 ) Purchases of marketable securities — ( 86,224 ) Proceeds from maturities of marketable securities 56,501 83,350 Net cash provided by (used in) investing activities 56,387 ( 4,745 ) Cash flow from financing activities Repayment on sale of future revenues ( 2,872 ) — Proceeds from issuance of common stock from at the market equity offering 1,435 — Proceeds from exercise of stock options — 192 Net cash (used in) provided by financing activities ( 1,437 ) 192 Net increase (decrease) in cash, cash equivalents, and restricted cash 7,151 ( 54,425 ) Cash, cash equivalents, and restricted cash, beginning of period 135,418 127,529 Cash, cash equivalents, and restricted cash, end of period $ 142,569 $ 73,104 Cash and cash equivalents, end of period 138,692 69,227 Restricted cash 1 3,877 3,877 Cash, cash equivalents, and restricted cash, end of period $ 142,569 $ 73,104 1 As of March 31, 2025 and March 31, 2024, restricted cash of $ 3,877 and $ 3,877 was included in Restricted cash and other non-current assets on the Consolidated Balance Sheet, respectively. 7 Table of Contents Supplemental disclosure of cash and non-cash activities: Fixed asset additions included in accounts payable and accrued expenses $ — $ 1,644 Cash paid in connection with operating lease liabilities 5,406 3,847 Remeasurement of operating lease liabilities and right-of-use assets due to lease modification 766 794 The accompanying notes are an integral part of the condensed consolidated financial statements. 8 Table of Contents Editas Medicine, Inc. Notes to Condensed Consolidated Financial Statements (unaudited) 1. Nature of Business Editas Medicine, Inc. (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. Its principal offices are in Cambridge, Massachusetts. 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, 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 the purchase and sale agreement with DRI Healthcare Acquisitions LP (“DRI”), 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. Liquidity As of March 31, 2025, 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 purchase and sale agreement with DRI, payments received under its license agreement with Vertex, its research collaboration with BMS through its wholly owned subsidiary Juno Therapeutics and its former strategic alliance with Allergan (which was terminated in August 2020). As of March 31, 2025, the Company had cash, cash equivalents and marketable securities of $ 221.0 million. 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 the Company’s common stock through TD Cowen in at-the-market offerings for aggregate gross sale proceeds of up to $ 300.0 million. The Company amended the common stock sales agreement with TD Cowen in February 2024 in connection with filing a new registration statement. In March 2025, the Company further amended its common stock sales agreement with TD Cowen in connection with amending its existing shelf registration statement following the loss of the Company’s status as a “well-known seasoned issuer” (as defined under Rule 405 of the Securities Act of 1933, as amended), reducing the amount of shares of common stock the Company may issue and sell through TD Cowen to aggregate gross sale proceeds of up to $ 150.0 million (the “ATM Facility”). As of March 31, 2025, the Company has sold 706,236 shares of common stock under the ATM Facility for gross proceeds of $ 1.4 million and has $ 148.6 million available under the ATM Facility. The Company has incurred annual net operating losses in every year since its inception. As of May 12, 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 consolidated financial statements. The Company had an accumulated deficit of $ 1.5 billion at March 31, 2025, and will require substantial additional capital to fund its operations. The Company has never generated any product revenue. There can be no assurance that the Company will be able to obtain additional debt or equity financing or generate product revenue or revenues from collaborative partners, on terms acceptable to the Company, on a timely basis or at all. The failure of the Company to obtain sufficient funds on acceptable terms when needed could have a material adverse effect on the Company’s business, results of operations, and financial condition. 9 Table of Contents 2. Summary of Significant Accounting Policies Unaudited Interim Financial Information The condensed consolidated financial statements of the Company included herein have been prepared, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America have been condensed or omitted from this report, as is permitted by such rules and regulations. Accordingly, these condensed consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024 (the “Annual Report”). The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Editas Securities Corporation and Editas Medicine, LLC. All intercompany transactions and balances of the subsidiaries have been eliminated in consolidation. In the opinion of management, the information furnished reflects all adjustments, all of which are of a normal and recurring nature, necessary for a fair presentation of the results for the reported interim periods. The Company considers events or transactions that occur after the balance sheet date but before the financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. Refer to Note 14, “Subsequent Events,” for further information on events and transactions that have occurred after the balance sheet date but before the financial statements are issued. The three months ended March 31, 2025 and 2024 are referred to as the first quarter of 2025 and 2024, respectively. The results of operations for interim periods are not necessarily indicative of results to be expected for the full year or any other interim period. Summary of Significant Accounting Policies The Company’s significant accounting policies are described in Note 2, “Summary of Significant Accounting Policies,” to the consolidated financial statements included in the Annual Report. There have been no material changes to the significant accounting policies previously disclosed in the Annual Report with the exception of the following: Restructuring The Company records liabilities for costs associated with restructuring activities in the period in which the liability is incurred. Typical costs associated with restructuring activities include, employee termination benefits, contract termination costs and on-going contract costs for which there is no economic benefit. For costs associated with employee terminations in which the employee is subject to an existing benefit arrangement, the post employment benefits are recognized when probable and estimable. Other employee termination costs are measured and recognized on the communication date, unless there is a required future service period, in which case, the expense is recognized over the service period. Contract termination costs are recognized upon termination of the contract and costs for on-going contracts for which there is no future benefit, are recognized at fair value on the cease-use date. The Company has made estimates and judgments regarding the amount and timing of its restructuring expense and liability, including current and future period termination benefits and other exit costs to be incurred when related actions take place. Restructuring charges are reflected in the Company's condensed consolidated statements of operations. Actual results may differ from these estimates. Refer to Note 12, “Restructuring and Impairment Charges” for further information. Recently Adopted Accounting Pronouncements 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. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024 on a prospective basis, with the option to apply the standard retrospectively. Early adoption is permitted. The Company will incorporate the changes in disclosure requirements in its financial statements included in its 2025 Annual Report. Recently Issued Accounting Pronouncements 10 Table of Contents In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“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. 3. Cash Equivalents and Marketable Securities Cash equivalents and marketable securities consisted of the following at March 31, 2025 (in thousands): Amortized Cost Allowance for Credit Losses Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash equivalents and marketable securities: U.S. Treasuries 82,184 — 93 ( 5 ) 82,272 Money market funds 138,692 — — — 138,692 Total $ 220,876 $ — $ 93 $ ( 5 ) $ 220,964 Cash equivalents and marketable securities consisted of the following at December 31, 2024 (in thousands): Amortized Cost Allowance for Credit Losses Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash equivalents and marketable securities: Money market funds 131,541 — — — 131,541 Corporate notes/bonds 6,522 — — ( 21 ) 6,501 U.S. Treasuries 131,582 — 289 — 131,871 Total $ 269,645 $ — $ 289 $ ( 21 ) $ 269,913 As of March 31, 2025, the Company did not hold any marketable securities that were in a continuous unrealized loss position for more than twelve months. Furthermore, the Company has determined that there were no material changes in the credit risk of the securities. As of March 31, 2025, the Company holds no securities with remaining maturities greater than one year . There were no realized gains or losses on available-for-sale securities during the three months ended March 31, 2025 or 2024. 11 Table of Contents 4. Fair Value Measurements Assets measured at fair value on a recurring basis as of March 31, 2025 were as follows (in thousands): March 31, 2025 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Cash equivalents: Money market funds $ 138,692 $ 138,692 $ — $ — Marketable securities: U.S. Treasuries 82,272 82,272 — — Restricted cash and other non-current assets: Money market funds 3,877 3,877 — — Total financial assets $ 224,841 $ 224,841 $ — $ — Assets measured at fair value on a recurring basis as of December 31, 2024 were as follows (in thousands): December 31, 2024 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Cash equivalents: Money market funds $ 131,541 $ 131,541 $ — $ — Marketable securities: Corporate notes/bonds 6,501 — 6,501 — U.S. Treasuries 131,871 131,871 — — Restricted cash and other non-current assets: Money market funds 3,877 3,877 — — Total financial assets $ 273,790 $ 267,289 $ 6,501 $ — 5. Accrued Expenses Accrued expenses consisted of the following (in thousands): March 31, 2025 December 31, 2024 External research and development expenses $ 10,439 $ 11,630 Employee related expenses 3,515 11,516 Sublicense and license fees 61 6,609 Intellectual property and patent related fees 2,243 1,471 Professional service expenses 446 1,593 Restructuring charges 30,542 12,232 Other expenses 242 808 Total accrued expenses $ 47,488 $ 45,859 12 Table of Contents 6. Property and Equipment, net and Assets Held for Sale Property and equipment, net consisted of the following (in thousands): March 31, 2025 December 31, 2024 Laboratory and manufacturing equipment $ 21,066 $ 29,128 Leasehold improvements 10,242 11,749 Computer equipment 1,399 1,490 Construction-in-progress 193 827 Furniture and office equipment 191 264 Software 2,759 2,687 Total property and equipment 35,850 46,145 Less: accumulated depreciation ( 27,668 ) ( 31,648 ) Property and equipment, net $ 8,182 $ 14,497 At March 31, 2025, $ 0.3 million of laboratory and manufacturing equipment was held for sale and included in Prepaid expenses and other current assets on the Consolidated Balance Sheet. Refer to Note 12, “Restructuring and Impairment Charges” for further information. 7. Commitments and Contingencies The Company is a party to a number of license agreements under which the Company licenses patents, patent applications and other intellectual property from third parties. As such, the Company is obligated to pay licensors for various costs including upfront licenses fees, annual license fees, certain licensor expense reimbursements, success payments, research funding payments, and milestones triggerable upon certain development, regulatory, and commercial events as well as royalties on future products. These contracts are generally cancellable, with notice, at the Company’s option and do not have significant cancellation penalties. The terms and conditions as well as the accounting analysis for the Company’s significant commitments and contingencies are described in Note 8, “Commitments and Contingencies” to the consolidated financial statements included in the Annual Report. There have been no material changes to the terms and conditions, or the accounting conclusions, previously disclosed in the Annual Report. Licensor Expense Reimbursement The Company is obligated to reimburse The Broad Institute, Inc. (“Broad”) and the President and Fellows of Harvard College (“Harvard”) for expenses incurred by each of them associated with the prosecution and maintenance of the patent rights that the Company licenses from them pursuant to the license agreement by and among the Company, Broad and Harvard, including the interference and opposition proceedings involving patents licensed to the Company under the license agreement, and other license agreements between the Company and Broad. As such, the Company anticipates that it has a substantial commitment in connection with these proceedings until such time as these proceedings have been resolved, but the amount of such commitment is not determinable. The Company incurred an aggregate of $ 1.9 million and $ 2.0 million in expense during the three months ended March 31, 2025, and March 31, 2024, respectively, for such reimbursement. 8. Collaboration Agreements The Company has entered into multiple collaborations, out-licenses and strategic alliances with third parties that typically involve payments to or from the Company, including up-front payments, payments for research and development services, option payments, milestone payments and royalty payments to or from the Company. The terms and conditions as well as the accounting analysis for the Company’s significant collaborations, out-licenses and strategic alliances are described in Note 9, “Collaboration Agreements” to the consolidated financial statements included in the Annual Report. There have been no other material changes to the terms and conditions, or the accounting conclusions, previously disclosed in the Annual Report. 13 Table of Contents Collaboration Revenue As of March 31, 2025, the Company’s contract liabilities were primarily related to the Company’s collaboration with BMS. The following table presents changes in the Company’s accounts receivable and contract liabilities for the three months ended March 31, 2025 (in thousands): Balance at December 31, 2024 Additions Deductions Balance at March 31, 2025 Accounts receivable $ 16,266 $ 603 $ ( 16,359 ) $ 510 Contract liabilities: Deferred revenue $ 60,425 $ — $ ( 4,221 ) $ 56,204 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”) to extend the collaboration to November 2026, with options to extend the collaboration for up to an additional two years , and provided Juno Therapeutics the ability to select up to three new gene targets for research. The 2019 Collaboration Agreement, as amended by the 2024 Amendment, is herein referred to as the 2019 Amended Collaboration Agreement. The Company’s accounting assessment for the 2024 Amendment is described in Note 9, “Collaboration Agreements,” to the consolidated financial statements included in the Annual Report. During the three months ended March 31, 2025 the Company did not recognize any of the $ 56.7 million transaction price. As of March 31, 2025, there was no short-term deferred revenue and $ 50.2 million of long-term deferred revenue in the accompanying consolidated balance sheets. 9. Stock-based Compensation Total compensation cost recognized for all stock-based compensation awards in the condensed consolidated statements of operations was as follows (in thousands): Three Months Ended March 31, 2025 2024 Research and development $ 907 $ 2,908 General and administrative 2,072 4,677 Total stock-based compensation expense $ 2,979 $ 7,585 Restricted Stock Unit Awards The following is a summary of restricted stock unit awards activity for the three months ended March 31, 2025: Shares Weighted Average Grant Date Fair Value Per Share Unvested restricted stock unit awards as of December 31, 2024 2,326,523 $ 9.78 Issued 1,560 $ 1.26 Vested ( 268,604 ) $ 10.39 Forfeited ( 560,376 ) $ 10.92 Unvested restricted stock unit awards as of March 31, 2025 1,499,103 $ 9.24 14 Table of Contents There were no restricted stock units that contained performance-based vesting provisions granted in the three months ended March 31, 2025. There was no expense related to the vesting of performance-based restricted stock units for the three months ended March 31, 2025 and $ 3.4 million of expense related to the vesting of performance-based restricted stock units for the three months ended March 31, 2024. As of March 31, 2025, total unrecognized compensation expense related to unvested restricted stock unit awards was $ 8.4 million, which the Company expects to recognize over a remaining weighted-average period of 2.18 years. Stock Options The following is a summary of stock option activity for the three months ended March 31, 2025: Shares Weighted Average Exercise Price Remaining Contractual Life (years) Aggregate Intrinsic Value Outstanding at December 31, 2024 7,656,010 $ 14.70 7.19 $ — Granted 5,295,288 $ 1.72 Exercised — $ — Cancelled ( 1,697,631 ) $ 13.09 Outstanding at March 31, 2025 11,253,667 $ 8.84 8.22 $ — Exercisable at March 31, 2025 3,646,110 $ 18.34 5.87 $ — As of March 31, 2025, total unrecognized compensation expense related to stock options was $ 21.6 million, which the Company expects to recognize over a remaining weighted-average period of 2.9 years. 10. Net Loss per Share Basic net loss per common share is calculated by dividing the net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted average number of shares of common stock and potentially dilutive securities outstanding for the period determined using the treasury stock and if converted methods. Contingently issuable shares are included in the calculation of basic loss per share as of the beginning of the period in which all the necessary conditions have been satisfied. Contingently issuable shares are included in diluted loss per share based on the number of shares, if any, that would be issuable under the terms of the arrangement if the end of the reporting period was the end of the contingency period, if the results are dilutive. For purposes of the diluted net loss per share calculation, unvested restricted stock unit awards and outstanding stock options are considered to be common stock equivalents, but they were excluded from the Company’s calculation of diluted net loss per share allocable to common stockholders because their inclusion would have been anti-dilutive. Therefore, basic and diluted net loss per share applicable to common stockholders were the same for all periods presented. The following common stock equivalents were excluded from the calculation of diluted net loss per share allocable to common stockholders because their inclusion would have been anti-dilutive: March 31, 2025 2024 Unvested restricted stock unit awards 1,499,103 2,728,834 Outstanding stock options 11,253,667 7,791,363 Total 12,752,770 10,520,197 15 Table of Contents 11. Debt Liability for the Sale of Future Revenues On October 3, 2024, the Company entered into a purchase and sale agreement (the “Purchase and Sale Agreement”) with 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 that will be owed by the Company to Broad and Harvard (each term as defined in Note 8, respectively). The Company has retained rights to its portions of certain other 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 Accounting Standards Codification (“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 March 31, 2025, 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. 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 March 31, 2025 (in thousands): March 31, 2025 Deferred royalty obligation related to the sale of future revenues, net as of December 31, 2024 $ 57,434 Payments for sale of future revenues ( 5,000 ) Non-cash interest expense associated with sale of future revenues 2,085 Amortization of issuance costs 60 Deferred royalty obligation related to the sale of future revenues, net as of March 31, 2025 $ 54,579 12. Restructuring and Impairment Charges 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”). Since the Discontinuation and Reduction started in December 2024 through the three months ended March 31, 2025, the Company has incurred the following restructuring and impairment charges (in thousands): 16 Table of Contents Employee termination benefits $ 13,984 Costs for ongoing contracts and terminated contracts 30,632 Acceleration of expense for change in useful life estimate 4,745 Impairment charges 3,724 Total restructuring and impairment charges $ 53,085 The Company incurred the following restructuring and impairment charges for the three months ended March 31, 2025, which are recorded in the consolidated statement of operations (in thousands): Employee termination benefits $ 3,509 Costs for ongoing contracts and terminated contracts 28,875 Acceleration of expense for change in useful life estimate 4,745 Impairment charges 3,724 Total restructuring and impairment charges $ 40,853 The actions associated with the Discontinuation and Reduction commenced in December 2024 and are expected to be substantially completed by the end of 2025. Employee Termination Benefits Employees affected by the Reduction received involuntary termination benefits 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 had 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 March 31, 2025 (in thousands): Employee Termination Benefits Accrued employee termination benefits as of December 31, 2024 $ 10,475 Employee termination benefits charges incurred during period 3,509 Amounts paid or otherwise settled during the period ( 3,877 ) Accrued employee termination benefits as of March 31, 2025 $ 10,107 In total, the Company expects that it will incur approximately $ 15.2 million of employee termination benefit expense to implement the Reduction. Costs for Ongoing Contracts and Terminated Contracts 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 costs when incurred for terminated contracts or at the cease-use date, as it relates to contract costs that continue to be incurred. The following table shows the liability related to costs for ongoing contracts and contract termination costs as of March 31, 2025 (in thousands): 17 Table of Contents Contract Costs Accrued contract costs as of December 31, 2024 $ 1,757 Contract costs incurred during the period 28,875 Amounts paid or otherwise settled during the period ( 10,197 ) Accrued contract costs as of March 31, 2025 $ 20,435 These costs are subject to significant estimation based on the Company's expectation of the costs that will continue to be incurred on the contracts, as well as negotiation of contract changes and terminations with its vendors. Changes in this estimate will be made in the period the information is known and could be material. Impairment and Accelerated Depreciation Charges In conjunction with the Discontinuation, the Company committed to a plan to actively sell specific assets within its asset group, primarily its laboratory and manufacturing equipment. The laboratory and manufacturing equipment met all of the prescribed criteria required to classify it as held for sale. The Company recorded $ 0.3 million of held for sale assets at their fair value at March 31, 2025, resulting in a $ 3.7 million impairment charge. The fair value of the held for sale assets was determined based on the contractual sales price and determined to be a level 2 fair value measurement. The assets held for sale are included in Prepaid expenses and other current assets on the Consolidated Balance Sheet as the Company expects to sell the assets within one year. Additionally, the Company evaluated certain other leasehold improvements, software, and right of use assets and concluded that it would abandon the leasehold improvements, software and right of use asset in the second quarter of 2025, and as a result, the Company accelerated depreciation and rent expense resulting in $ 0.7 million and $ 4.0 million of incremental expense, respectively. In total, the Company anticipates incurring $ 9.8 million in impairment charges related to the impairment of laboratory equipment and its related right of use asset in connection with the Discontinuation. 13. Segments 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): 18 Table of Contents Three Months Ended March 31, 2025 2024 Collaboration and other research and development revenues $ 4,658 $ 1,135 Operating expenses: Research and development 1 Employee related expenses 14,167 13,683 External research and development expenses 35,355 17,588 Facility expenses 9,393 5,219 Stock-based compensation expenses 907 2,908 Sublicense and license fees 17 5,896 Other expenses 3 5,997 3,493 General and administrative 2 Employee related expenses 5,105 4,889 Professional service expenses 2,439 2,915 Intellectual property and patent related fees 2,546 3,946 Stock-based compensation expenses 2,072 4,677 Facility and other expenses 4 2,823 2,912 Total operating expenses 80,821 68,126 Operating loss ( 76,163 ) ( 66,991 ) Other income, net: Other (expense) income, net ( 425 ) 6 Interest related to sale of future revenues ( 2,216 ) — Interest income, net 2,716 5,035 Total other income, net 75 5,041 Net loss $ ( 76,088 ) $ ( 61,950 ) 1 For the three months ended March 31, 2025 and 2024 includes $ 39,243 and $ — of restructuring and impairment charges, respectively. 2 For the three months ended March 31, 2025 and 2024 includes $ 1,610 and $ — of restructuring and impairment charges, respectively. 3 Other expenses primarily consists of impairment charges, consultant fees and office expenses 4 Facility and other expenses primarily consists of rent expense, insurance premiums, depreciation expense, software licenses and office expenses 14. Subsequent Events In 2023, the Company entered into a license and service agreement pursuant to which it leased manufacturing space for its continued research and development activities related to reni-cel. The lease commenced April 1, 2024. In September 2024, the Company 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, the Company gave its termination notice on the license and service agreement, which resulted in the end of the term of the agreement being July 2026, and $ 8.9 million of remaining payments owed. In April 2025, the Company modified the license and service agreement to terminate on April 30, 2025 with a final fixed payment of $ 3.7 million. 19 Table of Contents