Item 2. Management’s Discussion and Analysis
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis of our financial condition and results of operations should be read together with our condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, which was filed with the Securities and Exchange Commission (“SEC”) on March 9, 2026 (the “Annual Report”).
This Quarterly Report on Form 10-Q contains forward-looking statements that involve substantial risks and uncertainties. The words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. All statements addressing our future operating performance and development timelines that we expect or anticipate will occur in the future, as well as expectations for cash runway, are forward-looking statements. There are a number of important risks and uncertainties that could cause our actual results to differ materially from those indicated by forward-looking statements, including uncertainties inherent in the initiation and completion of preclinical studies and clinical development of our product candidates; availability and timing of results from preclinical studies; expectations for regulatory approvals to commence and conduct trials or to market products; and availability of cash resources sufficient to fund our foreseeable and unforeseeable operating expenses and capital expenditure requirements for the periods anticipated. These and other risks are described in greater detail in the Annual Report under the captions “Risk Factor Summary” and Part I, “Item 1A. Risk Factors,” as updated by our subsequent filings with the SEC. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements we make. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments that we may make.
You should read this Quarterly Report on Form 10-Q and the documents that we have filed as exhibits to this Quarterly Report on Form 10-Q completely and with the understanding that our actual future results may be materially different from what we expect. The forward-looking statements contained in this Quarterly Report on Form 10-Q are made as of the date of this Quarterly Report on Form 10-Q, and we do not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
Overview
We are a pioneering gene editing company dedicated to developing transformative genomic medicines to treat a broad range of serious diseases. We have developed a proprietary gene editing platform based on CRISPR technology and we continue to expand its capabilities. Our product development strategy is to target diseases where gene editing can be used to enable or enhance therapeutic outcomes for patients, while maximizing probability of technical, regulatory and commercial success. We are focused on the development of in vivo gene editing medicines utilizing functional upregulation, which aims to increase the expression of a normal gene copy and its normal protein function to treat diseases caused by genetic mutations that eliminate or disrupt normal function. We believe the ability to provide in vivo gene editing, in which the medicine is injected or infused into the patient to edit the cells inside their body, and functionally upregulates normal gene expression and normal protein function in the target tissues holds the potential to significantly expand the addressable therapeutic possibilities of CRISPR-based gene editing. To that end, our preclinical efforts are also focused on the creation of a “plug ‘n play” lipid nanoparticle (“LNP”) platform to enable targeted delivery of in vivo gene editing medicines to multiple cells and tissues, including the liver, hematopoietic stem cells (“HSCs”), and other cells and tissues.
In September 2025, we announced the nomination of our lead in vivo development candidate, EDIT-401, an experimental, potential best-in-class, one-time therapy to significantly reduce LDL-cholesterol (“LDL-C”) through upregulation of the LDL receptor (“LDLR”). EDIT-401 is designed to treat elevated levels of LDL-C, or hyperlipidemia, by directly editing the noncoding region of the LDLR gene to increase LDLR protein expression and reduce LDL-C levels. In preclinical studies, a single dose of EDIT-401 achieved approximately 90% or greater mean reductions in LDL-C, lipoprotein(a) (Lp(a)), an independent risk factor for atherosclerotic cardiovascular disease (“ASCVD”), and apolipoprotein B (ApoB), a key measure of total plaque-causing cholesterol particles and predictive measure for ASCVD, with rapid and dose-dependent effect, in non-human primates (“NHPs”). LDL-C mean reduction of 90% or greater with a single dose of EDIT-401 in NHPs was durable through approximately six months. In addition, in our preclinical studies, including an ongoing Good Laboratory Practice (GLP) toxicology study in NHPs, a single dose of EDIT-401 of 1.5 mg/kg had no
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adverse clinical observations, no notable treatment-related liver enzyme elevations, and no liver histopathology findings in non-GLP toxicology.
We continue to progress towards initiating a Phase 1/2 clinical trial of EDIT-401 in patients with Heterozygous Familial Hypercholesterolemia (“HeFH”). We have made a submission to the Human Research Ethics Committee in Australia for the trial and are on track to submit a Clinical Trial Notification in August 2026. The Phase 1/2 clinical trial will evaluate the safety, tolerability, and efficacy of a single dose of EDIT-401. The trial is designed in two parts. Part 1 is expected to be a single ascending dose, dose-finding study. Eligible patients will have a clinical diagnosis of HeFH with an elevated LDL-C despite treatment with two or more lipid lowering therapies. We plan to complete enrollment of Part 1 and have topline data results available in 2027. We expect that Part 2 of the trial will be a single-dose randomized, placebo-controlled expansion study, and that if the data from the Phase 1/2 trial warrant advancing EDIT-401, we would advance EDIT-401 into a single, pivotal randomized, placebo-controlled Phase 3 clinical trial in patients with HeFH, with or without existing ASCVD or coronary artery disease. These clinical trial plans are subject to further discussion and alignment with regulatory authorities. We have selected four clinical trial sites across Australia and New Zealand. We expect to report a data update in the first quarter of 2027 and share data from at least three patients in the EDIT-401 Phase 1/2 trial by the end of the third quarter of 2027.
We have also received pre-IND feedback from the U.S. Food and Drug Administration on our nonclinical package, CMC plans, and study design to support an Investigational New Drug Application (“IND”) for EDIT-401, which we believe provides optionality for submitting an IND supportive of our anticipated clinical development strategy.
Our discovery and development efforts further include HSCs and other cells and tissues. Building on our experience in our clinical trials of renizgamglogene autogedtemcel (“reni-cel”) , we have achieved in vivo preclinical proof-of-concept data of HSC editing in NHPs. In addition, w e previously announced in vivo delivery to two additional cell types in humanized mice using our proprietary LNP targeting platform, demonstrating the “plug ‘n play” potential of our proprietary extrahepatic LNP platform. We intend to continue optimizing candidates for our HSC program and exploring other cell types and tissues for development, but are focusing our resources on the advancement of our lead EDIT-401 program.
We are pursuing the right combination of gene editing and targeted delivery tools through internal development and the in-licensing of complementary technologies to build our preclinical pipeline and accelerate the achievement of our goal of delivering lifesaving medicines to patients with previously untreatable diseases. Through in-licensing of complementary technologies, we can expand our existing gene editing platform and further drive the development of our in vivo pipeline. This was demonstrated with our entry in 2024 into a collaboration and license agreement to access LNPs targeting the liver, including the LNP we are using in our EDIT-401 program. We also actively seek opportunities to out-license and partner our robust intellectual property portfolio to drive the development of CRISPR-based medicines in therapeutic areas outside of our core focus and to provide non-dilutive capital. For example, we are leveraging partnerships to progress engineered cell medicines to treat various cancers, including in our collaboration with Bristol-Myers Squibb Company (“BMS”) through its wholly owned subsidiary, Juno Therapeutics, Inc. (“Juno Therapeutics”). This collaboration, which leverages our Cas9 and AsCas12a platform technologies, seeks to advance alpha-beta T-cell experimental medicines for the treatment of solid tumors, liquid tumors, and autoimmune disease, and has resulted in 14 total programs to date, including BMS’ CD19 HD Allo CAR T program for the treatment of autoimmune disease currently in Phase I clinical development. The term for BMS to opt-in to additional research programs expires in November 2026, but our collaboration with respect to those ongoing programs that have been selected will continue past that date.
In addition, in December 2023, we and Vertex Pharmaceuticals, Inc. (“Vertex”) entered into a license agreement (the “Vertex License Agreement”), under which Vertex obtained a non-exclusive license for our Cas9 gene editing technology for ex vivo gene editing medicines targeting the BCL11A gene in the fields of SCD and TDT, including Vertex’s CASGEVY TM (exagamglogene autotemcel). We received a $50.0 million upfront cash payment in the fourth quarter of 2023 and the 2024 annual license fee of $10.0 million in the first quarter of 2024. The Vertex License Agreement further provides for the payment by Vertex of a potential additional $50.0 million contingent upfront payment and further future fixed and sales-based annual license fees, ranging from $5.0 million to $40.0 million annually, inclusive of certain sales-based annual license fee increases, through 2034. We are required to pay The Broad Institute, Inc. (“Broad”) and the President and Fellows of Harvard College (“Harvard”) a mid-double-digit percentage of amounts payable to us from Vertex under the Vertex License Agreement as it relates to Cas9 technology licensed by us from Broad and Harvard (the “Cas9-I License Agreement”). In October 2024, we entered into an agreement (the “DRI Agreement”) with a wholly owned subsidiary of DRI Healthcare Trust (“DRI”) providing for an upfront cash payment by DRI to us of $57.0 million. Under the DRI Agreement, DRI is purchasing up to 100% of certain future fixed and sales-based annual license fees that we are entitled to receive under the Vertex License Agreement, which fees range from $5.0 million to
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$40.0 million per year, including increases based on sales. In addition, DRI is purchasing a mid-double-digit percentage of a $50.0 million contingent upfront payment that we may receive under the Vertex License Agreement. All amounts above will be adjusted to exclude payments that we owe under the Cas9-I License Agreement. We have retained rights to certain 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 our licensor obligations.
Our operations to date have focused on organizing and staffing our company, business planning, raising capital, establishing our intellectual property portfolio, assembling our core capabilities in gene editing, seeking to identify potential product candidates, and undertaking preclinical studies and clinical trials. All of our ongoing research programs are still in the preclinical or research stage of development and the risk of failure of all of our research programs is high. We have not generated any revenue from product sales. We have primarily financed our operations through various equity financings, payments received under our research collaboration with BMS, our former strategic alliance with Allergan Pharmaceuticals International Limited (together with its affiliates, “Allergan”), which was terminated in August 2020, payments received under the DRI Agreement in connection with the Vertex License Agreement, and payments under the Vertex License Agreement.
We have incurred significant operating losses since inception. Our net losses were $43.2 million and $129.3 million for the six months ended June 30, 2026 and 2025, respectively. As of June 30, 2026, we had an accumulated deficit of $1.7 billion. We expect to continue to incur significant expenses and operating losses for the foreseeable future. Our net losses may fluctuate significantly from quarter to quarter and from year to year. We anticipate that our expenses will inc rease as we continue to support preclinical studies and prepare for the clinical development of EDIT-401; commence and conduct our planned clinical trials of EDIT-401; continue our current research programs and our preclinical development activities; seek to identify additional research programs and additional product candidates; initiate preclinical testing for other product candidates we identify and develop; maintain, expand, and protect our intellectual property portfolio, including reimbursing our licensors for such expenses related to the intellectual property that we in-license from such lice nsors; further develop our gene editing platform; and hire personnel. We do not expect to be profitable for the year ending December 31, 2026 or for the foreseeable future.
Financial Operations Overview
Revenue
To date, we have not generated any revenue from product sales, and we do not expect to generate any revenue from product sales for the foreseeable future.
In connection with our collaboration with BMS, we have received an aggregate of $159.0 million in payments, which have primarily consisted of the initial upfront and amendment payments, development milestone payments, research funding support, and certain opt-in fees. We no longer receive research funding support. During the three and six months ended June 30, 2026 and 2025, we did not recognize any revenue related to our collaboration with BMS. As of June 30, 2026, we had $32.3 million of deferred revenue related to BMS, all of which is classified as short-term deferred revenue on our condensed consolidated balance sheet. Under this collaboration, we recognize revenue upon delivery of option packages to BMS or upon receipt of development milestone payments. We expect that our revenue will fluctuate from quarter-to-quarter and year-to-year as a result of the timing of when we deliver such option packages or receive such milestone payments.
Pursuant to the Vertex License Agreement, we received a $50.0 million upfront cash payment in the fourth quarter of 2023 upon execution of the agreement and the 2024, 2025 and 2026 annual license fees of $10.0 million in each of the first quarters of 2024, 2025 and 2026. The license agreement further provides for the payment by Vertex of a potential additional $50.0 million contingent upfront payment and further annual license fees, ranging from $5.0 million to $40.0 million annually, inclusive of certain sales-based annual license fee increases, through 2034.
For additional information about our revenue recognition policy related to the Vertex License Agreement and BMS collaboration, see Part II, “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates—Revenue Recognition” included in the Annual Report.
For the foreseeable future, we expect substantially all of our revenue will be generated from the Vertex License Agreement, our collaboration with BMS, and any other collaborations or license agreements we may enter into.
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Operating Expenses
Research and Development Expenses
Research and development expenses consist primarily of costs incurred for our research, preclinical development, process and scale-up development, manufacture and clinical development of our product candidates, and the performance of development activities under our collaboration agreements. These costs are expensed as incurred and include:
• costs associated with our continued development of EDIT-401 as we prepare for and conduct clinical development of EDIT-401;
• employee-related expenses including salaries, benefits, and stock-based compensation expense;
• costs associated with conducting our other preclinical, process and scale-up development, manufacturing, quality, clinical and regulatory activities, including fees paid to third-party professional consultants, service providers and suppliers;
• costs of purchasing lab supplies and non-capital equipment used in our preclinical activities and in manufacturing preclinical and clinical study materials;
• costs incurred for the research and development activities under our collaboration agreements;
• facility costs including rent, depreciation, and maintenance expenses; and
• fees for acquiring and maintaining licenses under our third-party licensing agreements, including any sublicensing or success payments made to our licensors.
At this time, we cannot reasonably estimate or know the nature, timing, and estimated costs of the efforts that will be necessary to complete the development of any product candidates we may identify and develop. This is due to the numerous risks and uncertainties associated with developing such product candidates, including the uncertainty of:
• successful completion of preclinical studies, IND-enabling studies, and natural history studies;
• successful initiation of, enrollment in, and completion of, clinical trials;
• receipt of marketing approvals from applicable regulatory authorities;
• establishing commercial manufacturing capabilities or making arrangements with third-party manufacturers;
• obtaining and maintaining patent and trade secret protection and non-patent exclusivity;
• launching commercial sales of a product, if and when approved, whether alone or in collaboration with others;
• acceptance of a product, if and when approved, by patients, the medical community, and third-party payors;
• effectively competing with other therapies and treatment options;
• a continued acceptable safety profile following approval;
• enforcing and defending intellectual property and proprietary rights and claims; and
• achieving desirable medicinal properties for the intended indications.
A change in the outcome of any of these variables with respect to the development of any product candidates we develop would significantly change the costs, timing, and viability associated with the development of that product candidate.
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Research and development activities are central to our business model. We expect research and development expenses to increase in future periods to support our continued development of EDIT-401 and to fund our preclinical studies and clinical trials.
General and Administrative Expenses
General and administrative expenses consist primarily of salaries and other related costs, including stock-based compensation for personnel in executive, finance, investor relations, business development, legal, corporate affairs, information technology, facilities, and human resource functions. Other significant costs include corporate facility costs not otherwise included in research and development expenses, legal fees related to intellectual property and corporate matters, and fees for accounting and consulting services.
We anticipate that our general and administrative expenses that support continued research and development activities will remain consistent in the near future. We anticipate that expenses associated with operating as a public company, including costs for audit, legal, regulatory, and tax-related services, director and officer insurance premiums, and investor relation costs will remain flat in the near future. With respect to reimbursement of third-party intellectual property-related expenses specifically, given the ongoing nature of the opposition and interference proceedings involving the patents licensed to us under the Cas9-I License Agreement, we anticipate general and administrative expenses associated with reimbursement of third-party intellectual property-related expense will continue to fluctuate as the interference proceedings continue.
Restructuring and Impairment Charges
In December 2024, our board of directors approved the discontinuation of the clinical development of our ex vivo reni-cel program (the “Discontinuation”). As part of the Discontinuation, our board of directors approved a reduction in our employee workforce by approximately 180 positions, or by approximately 65% (the “Reduction”). Restructuring charges associated with the Discontinuation consist primarily of expenses in connection with the wind-down of various activities related to clinical development of reni-cel, including contract termination costs, impairment charges and non-cash charges, and expenses related to the Reduction, primarily consisting of severance payments and employee benefit costs. The actions associated with the Discontinuation and Reduction commenced in December 2024 and were substantially completed by December 31, 2025.
Other Income (Expense), Net
For the six months ended June 30, 2026 and 2025, other income (expense), net consisted primarily of interest income and the amortization of premiums or discounts on marketable securities and interest accretion related to the liability for the sale of future revenues.
Critical Accounting Policies and Estimates
Our management’s discussion and analysis of our financial condition and results of operations is based on our condensed consolidated financial statements, which have been prepared in accordance with United States generally accepted accounting principles. The preparation of our condensed consolidated financial statements requires us to make judgments and estimates that affect the reported amounts of assets, liabilities, revenues, and expenses, and the disclosure of contingent assets and liabilities in our condensed consolidated financial statements. We base our estimates on historical experience, known trends and events, and various other factors that we believe to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. On an ongoing basis, we evaluate our judgments and estimates in light of changes in circumstances, facts, and experience. The effects of material revisions in estimates, if any, will be reflected in the condensed consolidated financial statements prospectively from the date of change in estimates.
During the six months ended June 30, 2026, we had the following critical accounting policies and estimates as described in Part II, “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates” in the Annual Report.
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Revenue Recognition
We recognize revenue in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”), Topic 606, Revenue Recognition (“ASC 606”). Accordingly, we recognize revenue following the five-step model prescribed under Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers : (i) identify contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenues when (or as) we satisfy the performance obligation. We only apply the five-step model to contracts when it is probable that we will collect the consideration we are entitled to in exchange for the goods or services we transfer to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, we assess the goods or services promised within each contract and determine those that are performance obligations, and whether each promised good or service is distinct. We then recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. As part of the accounting for these arrangements, we must develop assumptions that require judgment to determine the standalone selling price for each performance obligation identified in the contract and use judgment in the determination of the transaction price and the application of the constraint. The determination of standalone selling price has not had a significant impact on the accounting for our revenue arrangements given the nature of the performance obligations. We have also not been required to apply significant judgment in determining the transaction price given the nature of the variable consideration and the application of the constraint.
Accrued Research and Development Expenses
As part of the process of preparing our financial statements, we are required to estimate our accrued expenses. This process involves reviewing open contracts and purchase orders, communicating with our personnel to identify services that have been performed on our behalf and estimating the level of service performed and the associated cost incurred for the service when we have not yet been invoiced or otherwise notified of the actual cost. The majority of our service providers invoice us monthly in arrears for services performed or when contractual milestones are met. We make estimates of our accrued expenses as of each balance sheet date in our financial statements based on facts and circumstances known to us at that time. Examples of estimated accrued research and development expenses include fees paid to clinical research organizations, investigative sites in connection with clinical trials, sponsored research organizations, service providers in connection with preclinical development activities, and service providers related to product manufacturing, development, and distribution of clinical supplies.
We base our accrued expenses related to clinical trials on our estimates of the services performed and efforts expended pursuant to our contractual arrangements, including those with clinical research organizations. The financial terms of these agreements are sometimes subject to negotiation, vary from contract to contract and may result in uneven payment flows. There may be instances in which payments made to our service providers will exceed the level of services performed and result in a prepayment of the clinical expense. Payments under some of these contracts depend on factors such as the successful enrollment of patients and the completion of clinical milestones. In accruing service fees, we estimate the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from our estimate, we adjust the accrual or prepaid accordingly.
Although we do not expect our estimates to be materially different from expenses actually incurred, if our estimates of the status and timing of services performed differs from the actual status and timing of services performed, we may report amounts that are too high or too low in any particular period. To date, there have been no material differences from our estimates to the amounts actually incurred.
Restructuring
We record 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 ongoing 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 ongoing contracts for which there is no future benefit are recognized at fair value on the cease-use date.
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We have made estimates and judgments regarding the amount and timing of our 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 our condensed consolidated statements of operations. Actual results may differ from these estimates.
Results of Operations
Comparison of the Three Months Ended June 30, 2026 and 2025
The following table summarizes our results of operations for the three months ended June 30, 2026 and 2025, together with the changes in those items in dollars (in thousands) and the respective percentages of change:
Three Months Ended
June 30, Dollar Change Percentage Change
2026 2025
Collaboration and other research and development revenues $ 11,890 $ 3,578 $ 8,312 n/m
Operating expenses:
Research and development 20,180 16,181 3,999 25 %
General and administrative 11,603 12,859 (1,256) (10) %
Restructuring and impairment charges (1,339) 26,082 (27,421) n/m
Total operating expenses 30,444 55,122 (24,678) (45) %
Other income (expense), net:
Interest expense related to sale of future revenues (1,061) (2,020) 959 (47) %
Interest income, net 1,368 2,087 (719) (34) %
Other income (expense), net 17 (1,758) 1,775 n/m
Total other income (expense), net 324 (1,691) 2,015 n/m
Net loss $ (18,230) $ (53,235) $ 35,005 (66) %
For our results of operations, we have included the respective percentage of changes, unless greater than 100% or less than (100)%, in which case we have denoted such changes as not meaningful (n/m).
Collaboration and Other Research and Development Revenues
Collaboration and other research and development revenues increased by $8.3 million to $11.9 million for the three months ended June 30, 2026 compared to $3.6 million for the same period in 2025. The increase was primarily attributable to recognition of deferred revenue related to the expiration of certain rights to opt-in to additional research programs under our collaboration with BMS.
Research and Development Expenses
Research and development expenses increased by $4.0 million to $20.2 million for the three months ended June 30, 2026 compared to $16.2 million for the same period in 2025. The following table summarizes our research and development expenses for the three months ended June 30, 2026 and 2025, together with the changes in those items in dollars (in thousands) and the respective percentages of change:
Three Months Ended
June 30, Dollar Change Percentage Change
2026 2025
Employee related expenses $ 4,900 $ 8,067 $ (3,167) (39) %
External research and development 7,190 2,595 4,595 n/m
Facility expenses 3,287 3,390 (103) (3) %
Stock-based compensation expenses 644 863 (219) (25) %
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Sublicense and license fees 1,643 95 1,548 n/m
Other expenses 2,516 1,171 1,345 n/m
Total research and development expenses $ 20,180 $ 16,181 $ 3,999 25 %
The increase in research and development expenses for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 was primarily attributable to:
• approximately $4.6 million in increased external research and development expenses primarily related to ongoing research and preclinical efforts for EDIT-401;
• approximately $1.5 million in increased sublicense and license fees paid in connection with licensing activity; and
• approximately $1.3 million in increased other expenses to support EDIT-401, including preclinical and regulatory consulting.
These increases were partially offset by:
• approximately $3.2 million in decreased employee-related expenses related to reduced headcount associated with the Reduction;
• approximately $0.2 million in decreased stock-based compensation expenses; and
• approximately $0.1 million in decreased facility expenses.
General and Administrative Expenses
General and administrative expenses decreased by $1.3 million to $11.6 million for the three months ended June 30, 2026 compared to $12.9 million for the three months ended June 30, 2025. The following table summarizes our general and administrative expenses for the three months ended June 30, 2026 and 2025, together with the changes in those items in dollars (in thousands) and the respective percentages of change:
Three Months Ended
June 30, Dollar Change Percentage Change
2026 2025
Employee related expenses $ 1,972 $ 3,132 $ (1,160) (37) %
Professional service expenses 1,838 3,550 (1,712) (48) %
Intellectual property and patent related fees 4,557 3,221 1,336 41 %
Stock-based compensation expenses 1,549 1,801 (252) (14) %
Facility and other expenses 1,687 1,155 532 46 %
Total general and administrative expenses $ 11,603 $ 12,859 $ (1,256) (10) %
The decrease in general and administrative expenses for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 was primarily attributable to:
• approximately $1.7 million in decreased professional service expenses due to reduced general business support needs;
• approximately $1.2 million in decreased employee-related expenses related to reduced headcount associated with the Reduction; and
• approximately $0.3 million in decreased stock-based compensation expenses.
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These decreases were partially offset by approximately $1.3 million in increased intellectual property and patent related legal fees due to increased legal activity related to intellectual property defense and $0.5 million in increased facility and other expenses.
Restructuring and Impairment Charges
During the three months ended June 30, 2026 we recorded a $1.3 million benefit related to restructuring and impairment compared to $26.1 million for the three months ended June 30, 2025 due to the Discontinuation and the Reduction. The following table summarizes our restructuring charges for the three months ended June 30, 2026 and 2025, together with the changes in those items in dollars (in thousands) and the respective percentages of change:
Three Months Ended June 30, Dollar Change Percentage Change
2026 2025
Employee termination benefits $ — $ 813 $ (813) (100) %
Costs for ongoing contracts and terminated contracts (1,339) 23,466 (24,805) n/m
Acceleration of expense for change in useful life estimate and lease termination — 1,803 (1,803) (100) %
Total restructuring and impairment charges $ (1,339) $ 26,082 $ (27,421) n/m
The restructuring and impairment benefit for the three months ended June 30, 2026 is primarily attributable to favorable adjustments to prior estimated costs for contracts associated with the Discontinuation upon finalization of contract costs.
Other Income (Expense), Net
For the three months ended June 30, 2026, and June 30, 2025 other income (expense), net was a $0.3 million net benefit and a $1.7 million net charge, respectively. The increase is attributable to increased investment income due to an increase in our investments for the three months ended June 30, 2026 compared to the three months ended June 30, 2025.
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Comparison of the Six Months ended June 30, 2026 and 2025
The following table summarizes our results of operations for the six months ended June 30, 2026 and 2025, together with the changes in those items in dollars (in thousands) and the respective percentages of change:
Six Months Ended
June 30, Dollar Change Percentage Change
2026 2025
Collaboration and other research and development revenues $ 14,721 $ 8,236 $ 6,485 79 %
Operating expenses:
Research and development 37,780 42,774 (4,994) (12) %
General and administrative 21,837 26,234 (4,397) (17) %
Restructuring and impairment charges (1,339) 66,935 (68,274) n/m
Total operating expenses 58,278 135,943 (77,665) (57) %
Other income (expense), net
Interest expense related to sale of future revenues (2,133) (4,236) 2,103 (50) %
Interest income, net 2,574 4,803 (2,229) (46) %
Other expense, net (96) (2,183) 2,087 (96) %
Total other income (expense), net 345 (1,616) 1,961 n/m
Net loss $ (43,212) $ (129,323) $ 86,111 (67) %
Collaboration and Other Research and Development Revenues
Collaboration and other research and development revenues increased by $6.5 million to $14.7 million for the six months ended June 30, 2026 compared to $8.2 million for the six months ended June 30, 2025. The increase was primarily attributable to the recognition of deferred revenue related to the expiration of certain rights to opt-in to additional research programs under our collaboration with BMS.
Research and Development Expenses
Research and development expenses decreased by $5.0 million to $37.8 million for the six months ended June 30, 2026 compared to $42.8 million for the six months ended June 30, 2025. The following table summarizes our research and development expenses for the six months ended June 30, 2026 and 2025, together with the changes in those items in dollars (in thousands) and the respective percentages of change:
Six Months Ended
June 30, Dollar Change Percentage Change
2026 2025
Employee related expenses $ 10,320 $ 19,389 $ (9,069) (47) %
External research and development expenses 10,694 10,066 628 6 %
Facility expenses 6,512 8,755 (2,243) (26) %
Stock-based compensation expenses 1,187 1,770 (583) (33) %
Sublicense and license fees 4,054 112 3,942 n/m
Other expenses 5,013 2,682 2,331 87 %
Total research and development expenses $ 37,780 $ 42,774 $ (4,994) (12) %
The decrease in research and development expenses for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 was primarily attributable to:
• approximately $9.1 million in decreased employee-related expenses related to reduced headcount associated with the Reduction;
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• approximately $2.2 million in decreased facility expenses primarily due to the end of leases for manufacturing space; and
• approximately $0.6 million in decreased stock-based compensation expense.
These decreases were partially offset by:
• approximately $3.9 million in increased sublicense and license fees paid in connection with licensing activity;
• approximately $2.3 million in increased other expenses related to professional services to support the progression of EDIT-401; and
• approximately $0.6 million in increased external research and development expenses.
General and Administrative Expenses
General and administrative expenses decreased by $4.4 million to $21.8 million for the six months ended June 30, 2026 compared to $26.2 million for the six months ended June 30, 2025. The following table summarizes our general and administrative expenses for the six months ended June 30, 2026 and 2025, together with the changes in those items in dollars (in thousands) and the respective percentages of change:
Six Months Ended
June 30, Dollar Change Percentage Change
2026 2025
Employee related expenses $ 4,081 $ 7,574 $ (3,493) (46) %
Professional service expenses 3,728 5,902 (2,174) (37) %
Intellectual property and patent related fees 7,659 5,767 1,892 33 %
Stock-based compensation expenses 3,108 3,873 (765) (20) %
Facility and other expenses 3,261 3,118 143 5 %
Total general and administrative expenses $ 21,837 $ 26,234 $ (4,397) (17) %
The decrease in general and administrative expenses for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 was primarily attributable to:
• approximately $3.5 million in decreased employee related expenses related to reduced headcount associated with the Reduction;
• approximately $2.2 million in decreased professional service expenses related to reduced strategic business activities; and
• approximately $0.8 million in decreased stock-based compensation expense.
These decreases were partially offset by:
• approximately $1.9 million in increased intellectual property and patent related fees due to increased legal activity related to intellectual property defense; and
• approximately $0.1 million in increased facility and other expense.
Restructuring and Impairment Charges
During the six months ended June 30, 2026 we recorded a $1.3 million benefit related to restructuring and impairment compared to a $66.9 million expense for the six months ended June 30, 2025 due to the Discontinuation and
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the Reduction. The following table summarizes our restructuring charges for the six months ended June 30, 2026 and 2025, together with the changes in those items in dollars (in thousands) and the respective percentages of change:
Six Months Ended June 30, Dollar Change Percentage Change
2026 2025
Employee termination benefits $ — $ 4,322 $ (4,322) (100) %
Costs for ongoing contracts and terminated contracts (1,339) 52,341 (53,680) n/m
Acceleration of expense for change in useful life estimate and lease termination — 6,548 (6,548) (100) %
Impairment charges — 3,724 (3,724) (100) %
Total restructuring and impairment charges $ (1,339) $ 66,935 $ (68,274) n/m
The restructuring and impairment benefit for the six months ended June 30, 2026 is primarily attributable to favorable adjustments to prior estimated costs for contracts associated with the Discontinuation upon finalization of contract costs.
During the six months ended June 30, 2025, we recorded $4.3 million, $52.3 million, $6.5 million and $3.7 million related to employee termination benefits, reni-cel-related contract costs, acceleration in expense due to changes in useful life estimates for leasehold improvements, software and a right-of-use asset, and impairment charges, respectively, due to the Discontinuation and the Reduction.
Other Income (Expense), Net
For the six months ended June 30, 2026 and June 30, 2025, other income (expense), net was a $0.3 million net benefit and a $1.6 million net charge, respectively, which primarily relates to interest income and accretion of discounts and premiums associated with marketable securities and interest accretion related to the liability for the sale of future revenues. The increase for the six months ended June 30, 2026 is attributable to increased investment income due to an increase in our investments compared to the six months ended June 30, 2025.
Liquidity and Capital Resources
Sources of Liquidity
As of June 30, 2026, we have raised an aggregate of $1.2 billion in net proceeds through the sale of shares of our common stock in public offerings and at-the-market offerings . We also have funded our business from our research collaboration with BMS through its wholly owned subsidiary Juno Therapeutics, our former strategic alliance with Allergan (which was terminated in August 2020), payments received under the DRI Agreement in connection with the Vertex License Agreement, and payments under the Vertex License Agreement. As of June 30, 2026, we had cash, cash equivalents, and marketable securities of $211.6 million.
In May 2026, we completed a public offering (the “Offering”) in which we sold 55,555,556 shares of our common stock and accompanying common stock warrants to purchase up to 55,555,556 shares of our common stock (or pre-funded warrants for shares of our common stock in lieu thereof). We received net proceeds of approximately $116.9 million after deducting underwriting discounts and commissions and other costs, and excluding any proceeds that may be received from the exercise of the common stock warrants. If all of the common stock warrants sold in the Offering were to be exercised in cash for shares of our common stock, we would receive additional proceeds of approximately $192.5 million.
In May 2021, we entered into a common stock sales agreement (the “Sales Agreement”) with TD Securities (USA) LLC (as successor to Cowen and Company, LLC) (“TD Cowen”), under which we from time to time can issue and sell shares of our common stock through TD Cowen in at-the-market offerings for aggregate gross sale proceeds of up to $300.0 million. We amended the Sales Agreement in February 2024 in connection with filing a new registration statement. In March 2025, we further amended the Sales Agreement in connection with amending our existing shelf registration statement following the loss of our status as a “well-known seasoned issuer” (as defined under Rule 405 of the Securities Act of 1933, as amended), reducing the amount of shares of common stock we may issue and sell through TD Cowen to aggregate gross sale proceeds of up to $150.0 million (the “ATM Facility”). In May 2026, we notified TD Cowen that we were suspending and terminating the prospectus supplement, dated March 21, 2025, related to the Sales Agreement. We will not make any sales of our common stock pursuant to the Sales Agreement unless and until a new prospectus or prospectus supplement is filed and, if applicable, a new registration statement covering such shares of common stock is
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declared effective by the SEC. The Sales Agreement remains in full force and effect. As of June 30, 2026, we have sold 14,327,365 shares of our common stock under the ATM Facility at a weighted average price of $3.07 per share for aggregate gross proceeds of $43.9 million and have $106.1 million of shares of our common stock remaining available for issuance and sale under the ATM Facility.
In addition to our existing cash and cash equivalents, we are eligible to earn milestone and other payments under our collaboration with BMS and our other collaboration and license agreements. Our ability to earn applicable milestone and other payments and the timing of earning these amounts are dependent upon the timing and outcome of development, regulatory and commercial activities and, as such, are uncertain at this time. As of June 30, 2026 , our right to contingent payments under our collaboration with BMS, as well as the retained portions of the contingent upfront payment and other amounts under the Vertex License Agreement, are our only significant committed potential external source of funds.
Cash Flows
The following table provides information regarding our cash flows for the six months ended June 30, 2026 and 2025 (in thousands):
Six Months Ended
June 30,
2026 2025
Net cash (used in) provided by:
Operating activities $ (52,629) $ (98,011)
Investing activities (29,736) 99,037
Financing activities 117,535 5,975
Net increase in cash, cash equivalents, and restricted cash $ 35,170 $ 7,001
Net Cash Used in Operating Activities
The use of cash in all periods resulted primarily from our net losses adjusted for non-cash charges and changes in components of working capital.
Net cash used in operating activities was approximately $52.6 million for the six months ended June 30, 2026, which primarily consisted of operating expenses related to our ongoing research and preclinical efforts and supporting business operations.
Net cash used in operating activities was approximately $98.0 million for the six months ended June 30, 2025, which primarily consisted of operating expenses that related to our ongoing research efforts, the wind-down of clinical and manufacturing activities in support of our former reni-cel program and supporting business operations.
Net Cash Used in (Provided by) Investing Activities
Net cash used in investing activities was approximately $29.7 million for the six months ended June 30, 2026, primarily related to purchases of marketable securities of $29.7 million.
Net cash provided by investing activities was approximately $99.0 million for the six months ended June 30, 2025, primarily related to the proceeds from the maturities of marketable securities of $99.0 million.
Net Cash Provided by (Used in) Financing Activities
Net cash provided by financing activities was approximately $117.5 million for the six months ended June 30, 2026 attributable to proceeds received from public offering of common stock of $117.5 million.
Net cash provided by financing activities was approximately $6.0 million for the six months ended June 30, 2025, primarily related to proceeds from the issuance of common stock from our at-the-market offering program of $8.6 million and proceeds received from issuance of common stock under our employee stock purchase plan of $0.2 million. This was offset by the repayment of our liability for the sale of future revenues with DRI of $2.9 million.
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Funding Requirements
We anticipate that our expenses will increase as we continue to support preclinical studies and prepare for the clinical development of EDIT-401; commence and conduct our planned clinical trials of EDIT-401; continue our current research programs and our preclinical development of product candidates from our current research programs; seek to identify additional product candidates and research programs; initiate preclinical testing and clinical trials for other product candidates we identify and develop; maintain, expand, and protect our intellectual property portfolio, including reimbursing our licensors for expenses related to the intellectual property that we in-license from such licensors; and incur costs associated with operating as a public company. In addition, if we obtain marketing approval for any product candidate that we identify and develop, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing, and distribution to the extent that such sales, marketing, and distribution are not the responsibility of a collaborator. We do not expect to generate significant recurring revenue unless and until we obtain regulatory approval for and commercialize a product candidate. Accordingly, we will need to obtain substantial additional funding in connection with our continuing operations. If we are unable to raise capital when needed or on attractive terms, we would be forced to delay, reduce, or eliminate our research and development programs or future commercialization efforts.
We expect that our existing cash and cash equivalents on June 30, 2026 will enable us to fund our operating expenses and capital expenditure requirements into the second half of 2028 . Our forecast of the period of time through which our existing cash and cash equivalents will be adequate to support our operations is a forward-looking statement and involves significant risks and uncertainties. We have based this forecast on assumptions that may prove to be wrong, and actual results could vary materially from our expectations, which may adversely affect our capital resources and liquidity. We could utilize our available capital resources sooner than we currently expect. The amount and timing of future funding requirements, both near- and long-term, will depend on many factors, including, but not limited to :
• the costs of progressing the preclinical and clinical development of EDIT-401;
• the scope, progress, results, and costs of drug discovery, preclinical development, laboratory testing, and any clinical or natural history study trials for product candidates we develop;
• the costs of preparing, filing, and prosecuting patent applications, maintaining and enforcing our intellectual property and proprietary rights, and defending intellectual property-related claims;
• the costs, timing, and outcome of regulatory review of the product candidates we develop;
• the costs of establishing and maintaining a supply chain for the development and manufacture of our product candidates;
• the costs of future activities, including product sales, medical affairs, marketing, manufacturing, and distribution, for any product candidates for which we receive regulatory approval;
• the success of our collaboration with BMS;
• our ability to establish and maintain additional collaborations on favorable terms, if at all;
• the extent to which we acquire or in-license other medicines and technologies;
• the costs of reimbursing our licensors for the prosecution and maintenance of the patent rights in-licensed by us; and
• our ability to establish and maintain healthcare coverage and adequate reimbursement for any product candidates for which we receive regulatory approval.
Identifying potential product candidates and conducting preclinical studies and clinical trials is a time-consuming, expensive, and uncertain process that takes many years to complete, and we may never generate the necessary data or results required to obtain marketing approval and achieve product sales. In addition, even if we successfully identify and develop product candidates that are approved, we will require significant additional funding in order to launch and commercialize our product candidates and may not achieve commercial success. Our commercial revenues, if any, will be derived from sales of genomic medicines that we do not expect to be commercially available for many years, if at all.
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Accordingly, we will need to continue to rely on additional financing to achieve our business objectives. Adequate additional financing may not be available to us on acceptable terms, or at all.
Until such time, if ever, as we can generate substantial product revenues, we expect to finance our cash needs through a combination of equity offerings, debt financings, collaborations, strategic alliances, and licensing arrangements. To the extent that we raise additional capital through the issuance of equity or convertible debt securities, our stockholders’ ownership interests will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our stockholders. Debt financing, if available, would result in increased fixed payment obligations and may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, or declaring dividends.
If we raise funds through additional collaborations, strategic alliances, or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs, or product candidates or to grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt financings when needed, we may be required to delay, limit, reduce, or terminate our product development or future commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.
Contractual Obligations
As of June 30, 2026, we had operating leases with future minimum lease payments for a total of $17.1 million, of which $3.8 million will be payable in 2026. These minimum lease payments exclude our share of the facility operating expenses, real-estate taxes, and other costs that are reimbursable to the landlord under the leases.
In 2023, we entered into a license and service agreement pursuant to which we leased manufacturing space for our continued research and development activities. The lease commenced April 1, 2024. In September 2024, we modified the lease, and as a result of the modification the lease payments decreased and the notification period for the termination of the license and service agreement increased from 12 months’ prior written notice to 18 months’ prior written notice. In January 2025, we gave our termination notice for 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, we modified the lease to terminate on April 30, 2025 with a final fixed payment of $3.7 million.
In October 2024, we entered into the DRI Agreement under which we sold, transferred, assigned, and conveyed to DRI certain future license fees and other payments owed to us by Vertex under the Vertex License Agreement in exchange for an upfront cash payment by DRI to us of $57.0 million. Under the DRI Agreement, DRI is purchasing up to 100% of certain future fixed and sales-based annual license fees that we are entitled to receive under the Vertex License Agreement, which fees range from $5.0 million to $40.0 million per year including increases based on sales. In addition, DRI is purchasing a mid-double-digit percentage of the $50.0 million contingent upfront payment that we may receive under the Vertex License Agreement, in each case after subtracting amounts owed by us to our licensors, The Broad Institute, Inc. and the President and Fellows of Harvard College. We have retained rights to certain 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 our licensor obligations.
Our agreements with certain institutions to license intellectual property include potential milestone payments and success fees, sublicense fees, royalty fees, licensing maintenance fees, and reimbursement of patent maintenance costs that we may be required to pay. Our agreements to license intellectual property include potential milestone payments that are dependent upon the development of products using the intellectual property licensed under the agreements and contingent upon the achievement of development or regulatory approval milestones, as well as commercial milestones. These potential obligations are contingent upon future events and the timing and likelihood of such potential obligations are not known with certainty. For further information regarding these agreements, please see Part I, “Item 1. Business—Our Collaborations and Licensing Strategy” in the Annual Report.
We also enter into contracts in the normal course of business with contract research organizations, contract manufacturing organizations, and other vendors to assist in the performance of our research and development activities and other services and products for operating purposes. These contracts generally provide for termination at any time upon prior notice.
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Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.