What changed in this filing

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Item 2. Management’s Discussion and Analysis

2021-05-06 compared with 2020-11-05 · 158 added, 220 removed, 164 unchanged (70% of the section changed)

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our ability to execute our clinical study strategy for NTLA-2001, our program for the treatment of transthyretin amyloidosis;

the anticipated timing of preclinical studies, manufacturing activities and our investigational new drug application (“IND”) or equivalent regulatory filing for NTLA-5001, our program for the treatment of acute myeloid leukemia;

the anticipated timing of preclinical studies, manufacturing activities and our IND application or equivalent regulatory filing for NTLA-2002, our program for the treatment of hereditary angioedema;

the anticipated timing of preclinical studies, manufacturing activities, our investigational new drug application (“IND”) or equivalent regulatory filing, and clinical studies for NTLA-5001, our program for the treatment of acute myeloid leukemia;

the anticipated timing of preclinical studies, manufacturing activities, our IND application or equivalent regulatory filing, and clinical studies for NTLA-2002, our program for the treatment of hereditary angioedema;

our ability to use a modular platform capability or other strategy to efficiently discover and develop product candidates, including by applying learnings from one program to other programs;

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the issuance or enforcement of, and compliance with, regulatory requirements and guidance regarding preclinical and clinical studies relevant to genome editing and our product candidates;

the pricing and reimbursement of our product candidates, if approved;

the market acceptance, pricing and reimbursement of our product candidates, if approved;

estimates of our expenses, future revenues, capital requirements and our needs for additional financing;

the potential benefits of strategic collaboration agreements and our ability to enter into strategic arrangements;

our ability to maintain and establish collaborations with third parties under favorable terms;

the potential benefits of strategic agreements, such as collaborations, co-development and co-commercialization, acquisitions, dispositions, mergers, joint venture and investment agreements, and our ability to establish and maintain strategic arrangements under favorable terms;

our ability to acquire and maintain relevant intellectual property licenses and rights, and the scope and terms of such rights;

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the effect of the coronavirus disease 2019 (“COVID-19”) pandemic, including mitigation efforts and economic effects, on any of the foregoing or other aspects of our business operations;

our ability to agree to terms with Caribou Biosciences, Inc.

(“Caribou”) in accordance with the September 2019 interim award issued by the arbitration panel in our arbitration against Caribou (the “Caribou Arbitration”), including the scope and potential payments of such arrangement;

other risks and uncertainties, including those listed under the caption “Risk Factors.”

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Intellia Therapeutics, Inc.

(“we,” “us,” “our,” “Intellia,” or the “Company”) is a leading genome editing company, focused on the development of proprietary, potentially curative therapeutics utilizing a biological tool known as CRISPR/Cas9, which stands for C lustered, R egularly I nterspaced S hort P alindromic R epeats (“CRISPR”) /CRISPR associated 9 (“Cas9”).

This is a technology for genome editing, the process of altering selected sequences of genomic deoxyribonucleic acid (“DNA”).

We believe that CRISPR/Cas9 technology has the potential to transform medicine by both producing therapeutics that permanently edit and/or correct disease-associated genes in the human body with a single treatment course, and creating enhanced engineered cells that can treat oncological and immunological diseases.

Our combination of deep scientific, technical and clinical development experience, along with our intellectual property (“IP”) portfolio, puts us in a position to unlock broad therapeutic applications of the CRISPR/Cas9 technology and create new classes of therapeutic products .

(“we,” “us,” “our,” “Intellia,” or the “Company”) is a leading clinical-stage genome editing company, focused on developing proprietary, potentially curative CRISPR/Cas9-based therapeutics.

CRISPR/Cas9, an acronym for C lustered, R egularly I nterspaced S hort P alindromic R epeats (“CRISPR”) / C RISPR a ssociated 9 (“Cas9”), is a technology for genome editing, the process of altering selected sequences of genomic deoxyribonucleic acid (“DNA”).

We believe the breakthrough CRISPR/Cas9 technology has the potential to transform medicine by both producing therapeutics that permanently edit and/or correct disease-associated genes in the human body with a single dose of treatment and creating enhanced engineered cell therapies.

Our combination of deep scientific, technical and clinical development experience, and proprietary innovations in genome editing and delivery technologies, along with our intellectual property (“IP”) portfolio, puts us in a position to unlock broad therapeutic applications of the CRISPR/Cas9 technology and create new classes of therapeutic products .

Our management’s discussion and analysis of our financial condition and results of operations are based upon our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q, which have been prepared by us in accordance with accounting principles generally accepted in the United States of America (“U.S.

GAAP”) for interim periods and with Regulation S-X, promulgated under the Securities Exchange Act of 1934, as amended.

This discussion and analysis should be read in conjunction with these unaudited condensed consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q as well as in conjunction with the audited financial statements and notes thereto included in our Annual Report on Form 10-K (“Annual Report”) for the year ended December 31, 2019.

Our mission is to build a company to develop curative genome editing treatments that can positively transform the lives of people living with severe and life-threatening disease.

This discussion and analysis should be read in conjunction with the unaudited condensed consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q as well as in conjunction with the audited financial statements and notes thereto included in our Annual Report on Form 10-K (“Annual Report”) for the year ended December 31, 2020.

Our mission is to transform the lives of people with severe diseases by developing curative genome editing treatments.

We believe we can deliver on our mission and provide long-term benefits for all of our stakeholders by focusing on four key elements:

Develop curative CRISPR/Cas9-based medicines;

Advance our science to help more patients;

Foster an environment that is the best place to make therapies;

Advance our science;

Be the best place to make therapies;

Focus on long-term sustainability.

Our strategy is to build a full-spectrum genome editing company, by leveraging our CRISPR/Cas9 platform across two areas:

in vivo applications, in which CRISPR/Cas9 is the therapy, delivered to target cells within the body;

and ex vivo applications, in which CRISPR/Cas9 creates the therapy of engineered human cells.

Our strategy is to build a full-spectrum genome editing company, by leveraging our modular platform, to advance in vivo and ex vivo therapies for diseases with high unmet need.

For in vivo applications to address genetic diseases, we deploy CRISPR/Cas9 as the therapy that targets cells within the body.

All of our revenue to date has been collaboration revenue.

Since our inception and through September 3 0 , 20 20 , we have raised an aggregate of approximately $ 8 93.6 million to fund our operations, of which $ 272.6 million was through our collaboration agreements, $170.5 million was from our initial public offering and concurrent private placements, $ 2 4 9.

1 million was from follow-on offering s , $ 1 1 6.

4 million was from at-the-market offering s and $85.0 million was from the sale of convertible preferred stock .

The breadth of our CRISPR/Cas9 platform and delivery technology allows us to pursue a multitude of therapeutic targets/clinical indications.

Specifically, we can target diseases that have the potential to be addressed by directly editing specific genes (i.e., gene knockout, repair, or insertion) as well as diseases that may be targeted by genetically engineered cell therapies.

The successful treatment of these disorders may require various types of genome edits, CRISPR/Cas9 elements and DNA templates.

We have assembled multiple in vivo and engineered cell therapy capabilities into a pipeline that reflects our full-spectrum approach and leverages the modularity inherent in our platform .

Our diversified pipeline includes in vivo development programs targeting genetic diseases, including transthyretin amyloidosis (“ATTR”), hemophilia A and hemophilia B, which we are co-developing with Regeneron Pharmaceuticals, Inc.

(“Regeneron”), and hereditary angioedema (“ HAE ”) .

Our pipeline also includes ex vivo programs consisting of two separate efforts:

(i) a set of proprietary programs focused on engineered cell therapies to treat various cancers and autoimmune diseases including our lead ex vivo program to target Wilms’ Tumor 1 (“WT1”) for acute myeloid leukemia (“AML”);

and (ii) partnered programs developed in collaboration with Novartis Institutes for BioMedical Research, Inc.

(“Novartis”), focused on chimeric antigen receptor (“CAR”) T (“CAR-T”) cells, hematopoietic stem cells (“HSCs”), the stem cells from which all of the various types of blood cells originate, and stem cells in the eye, or ocular stem cells (“OSCs”).

Our diversified pipeline includes in vivo and ex vivo programs.

Our in vivo programs focus on treating patients that have significant unmet medical needs due to diseases attributable to genes expressed in the liver – ATTR (which we are co-developing with Regeneron) and HAE.

Delivery plays a key role in our in vivo therapeutic approach.

We have shown in animal models that our proprietary lipid nanoparticle (“LNP”) delivery technology, which encapsulates the therapeutic Cas9 messenger RNA (“mRNA”) and guide RNA (“gRNA”) into LNPs, can systemically deliver these therapeutic components to the liver.

For ex vivo applications, our wholly owned programs focus on next-generation, engineered cell therapy solutions that utilize antigen-specific T cell receptors (“TCRs”).

The cells to be modified ex vivo can come from the individual patient (autologous source) or from another individual (allogeneic source).

Our goal for the ex vivo pipeline is to move from autologous to allogeneic therapies, and from liquid to solid tumors.

We believe our full spectrum approach to in vivo and ex vivo programs positions us to build a pipeline across a wide range of indications.

Since our inception and through March 31, 2021, we have raised an aggregate of approximately $1,165.3 million to fund our operations, of which $275.0 million was through our collaboration agreements, $170.5 million was from our initial public offering and concurrent private placements, $438.3 million was from follow-on public offerings, $196.5 million was from at-the-market offerings and $85.0 million was from the sale of convertible preferred stock.

Our lead in vivo candidate, NTLA-2001 for the treatment of transthyretin amyloidosis (“ATTR”), is the first-ever systemically delivered CRISPR/Cas9-based therapy to enter clinical evaluation.

In parallel, we are developing ex vivo applications to address immuno-oncology and autoimmune diseases, where CRISPR/Cas9 is the tool that creates the engineered cell therapy.

Our most advanced ex vivo programs include a wholly owned T cell receptor (“TCR”) -T cell candidate, NTLA-5001 for the treatment of acute myeloid leukemia (“AML”), and a program with Novartis Institutes for BioMedical Research, Inc.

(“Novartis”) to engineer hematopoietic stem cells (“HSCs”) for the treatment of sickle cell disease .

In Vivo Programs

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and for which effective treatments are absent, limited or unduly burdensome.

Our initial in vivo indications target genetic liver diseases, including ATTR and HAE, using a knockout approach.

Our current efforts on in vivo delivery focus on the use of LNPs for delivery of the CRISPR/Cas9 complex to the liver.

Transthyretin Amyloidosis – (“ATTR”)

Our initial in vivo indications target genetic liver diseases, including our ATTR and hereditary angioedema (“HAE”) development programs.

Our current efforts on in vivo delivery focus on the use of lipid nanoparticles (“LNPs”) for delivery of the CRISPR/Cas9 complex to the liver.

Transthyretin Amyloidosis (“ATTR”) Program

ATTR is a progressive and fatal disorder resulting from deposition of insoluble amyloid fibrils into multiple organs and tissues leading to systemic failure.

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Deposits of TTR amyloid in the heart, nerves and/or other tissues can lead to diverse disease manifestations, including two main hereditary forms – hATTR with polyneuropathy (“hATTR-PN”), and hATTR with cardiomyopathy (“hATTR-CM”).

Typical onset of disease symptoms is during adulthood and can be fatal within 2 to 15 years.

Typical onset of disease symptoms is during adulthood and can be fatal within two to 15 years.

Estimates suggest that approximately 50,000 patients suffer from hATTR worldwide.

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In December 2019, we completed a year-long durability study of our lead LNP formulation, maintaining an average reduction of more than 95% of serum TTR protein after a single dose in NHPs.

The data from our various NHP studies has also demonstrated the transient nature of our proprietary modular LNP delivery system, which was rapidly cleared from circulation, with all CRISPR/Cas9 complex undetectable in blood and liver within ten days of administration.

Our lead candidate, NTLA-2001, applies an in vivo liver gene knockout approach for the treatment of ATTR.

In October 2020, we announced the authorization of our Clinical Trial Application (“CTA”) by the United Kingdom’s Medicines and Healthcare products Regulatory Agency (“MHRA”) to initiate our Phase 1 study to evaluate NTLA-2001 for the treatment of hATTR-PN.

Subject to the potential impact of the COVID-19 pandemic, we expect to dose the first patient in this Phase 1 trial during the fourth quarter of 2020.

In addition, we are submitting additional regulatory applications to enable enrollment in other countries as part of our global clinical development plans.

The Phase 1 study will be a two-part, open label, multi-center study in adults with hATTR-PN to assess the safety, tolerability, pharmacokinetics and pharmacodynamics of NTLA-2001, which will include the measurement of serum TTR levels following a single intravenous infusion.

NTLA-2001 is part of a co-development and co-promotion (“Co/Co”) agreement directed to our first collaboration target with Regeneron, ATTR (the “ATTR Co/Co”), for which we are the clinical and commercial Lead Party and Regeneron is the Participating Party (see Note 7 to the condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q for further detail).

Pursuant to the ATTR Co/Co agreement, Regeneron funded approximately 50% of the program’s development costs through 2019.

On December 13, 2019, Regeneron informed us that it would exercise its right under the ATTR Co/Co agreement to modify its share of worldwide development costs and profits from 50% to 25%, effective in mid-June 2020.

Hereditary Angioedema – (“HAE”)

The data from our various NHP studies has shown that following editing, our proprietary modular LNP delivery system is rapidly cleared from circulation, such that exposure to components is transient and all CRISPR/Cas9 complex is undetectable in blood within 14 days of administration.

About the NTLA-2001 Clinical Program

In November 2020, we announced that the first patient had been dosed with NTLA-2001, which we are developing as a single-dose, potentially curative therapy for ATTR, in our global Phase 1 study.

We are conducting our global Phase 1 study to evaluate NTLA-2001 for hATTR-PN patients.

Our first patient was dosed in the United Kingdom (“U.K.”) pursuant to authorization of our Clinical Trial Application (“CTA”), which was received from the U.K.’s Medicines and Healthcare products Regulatory Agency in October 2020.

In November 2020, as part of our ongoing Phase 1 study for NTLA-2001, we received a second CTA authorization from New Zealand’s Medicines and Medical Device Safety Authority to enroll ATTR patients at a clinical site.

As part of our ongoing global development strategy, we are submitting additional regulatory applications in other countries.

In March 2021, we announced that the European Commission (“EC”) granted orphan drug designation to NTLA-2001.

Our global Phase 1 trial is an open-label, multi-center, two-part study of NTLA-2001 in adults with hATTR-PN.

The trial’s primary objectives are to assess the safety, tolerability, pharmacokinetics and pharmacodynamics of NTLA-2001.

Patients receive a single dose of NTLA-2001 via intravenous administration.

The study will enroll up to 38 participants (ages 18-80 years) and consist of a single-ascending dose phase in Part 1 and, following the identification of an optimal dose, an expansion cohort in Part 2.

Following safety assessment and dose optimization, we intend to further evaluate NTLA-2001 in a broader ATTR patient population of both polyneuropathy and cardiomyopathy patients.

We anticipate reporting interim clinical data from the single ascending dose portion of the Phase 1 study evaluating NTLA-2001 in adults with hATTR-PN in mid-2021.

NTLA-2001 is part of a co-development and co-promotion (“Co/Co”) agreement directed to our first collaboration target with Regeneron Pharmaceuticals, Inc.

(“Regeneron”), ATTR (the “ATTR Co/Co”), for which we are the clinical and commercial lead party and Regeneron is the participating party.

Regeneron shares in approximately 25% of worldwide development costs and commercial profits for the ATTR program.

For more information regarding our collaboration with Regeneron, see the section below entitled “ Collaborations - Regeneron Pharmaceuticals, Inc.

Hereditary Angioedema (“HAE”) Program

HAE is a rare genetic disorder characterized by recurrent, painful and unpredictable episodes of severe swelling.

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Prophylactic treatments are used to reduce the number of attacks that a patient may experience.

Prophylactic treatments have proven to be effective in reducing the number of attacks for most patients, though some patients still experience breakthrough attacks and such treatment options require regular injections which can be associated with significant treatment burden and impact on quality of life.

Using our modular LNP delivery system, we aim to knock out the prekallikrein B1 (“KLKB1” ) gene with a single course of treatment to reduce plasma kallikrein activity to prevent excess bradykinin production leading to HAE attacks.

Prophylactic treatments have proven to be effective in reducing the number of attacks for most patients, though some patients still experience breakthrough attacks and such treatment options require regular injections that can be associated with significant treatment burden and impact on quality of life.

Using our modular LNP delivery system, we aim to knock out the kallikrein B1 (“KLKB1” ) gene with a single dose of treatment to permanently reduce the plasma kallikrein protein and activity and thereby ameliorate the frequency and intensity of HAE attacks.

We expect our approach should eliminate the current, significant treatment burden for people living with HAE and minimize the risk of breakthrough attacks with extensive and continuous reduction in plasma kallikrein activity.

We believe KLKB1 knockout to be safe, as humans with prekallikrein deficiency appear to have no known health effects.

In addition, inhibition of kallikrein activity has proven to be a clinically effective approach as a prophylactic treatment for HAE.

On May 7, 2020, we announced a development candidate for the treatment of HAE, NTLA-2002 , a wholly owned program .

We have completed a NHP durability study of our lead LNP formulation in support of NTLA-2002, which resulted in a year-long therapeutically relevant reduction of serum kallikrein protein levels and activity following a single dose.

In addition, during the third quarter of 2020 we have initiated Good Laboratory Practices ( “ GLP ” ) toxicology studies in preparation for an IND or IND-equivalent regulatory submission for NTLA-2002 in the second half of 2021.

In addition, inhibition of kallikrein activity has proven to be clinically effective as a prophylactic treatment for HAE.

NTLA-2002 is our wholly owned development candidate for the treatment of HAE.

In March 2021, we presented preclinical results confirming greater reductions in serum kallikrein protein levels and activity versus the current standard of care for HAE, sustained over seventeen months following a single dose in an ongoing NHP study.

Additionally, we presented data from a humanized KLKB1 mouse model of bradykinin-mediated vascular permeability, establishing that a single administration of NTLA-2002 prevented captopril-induced vascular leakage.

These results affirm NTLA-2002’s therapeutic hypothesis of preventing HAE attacks.

We plan to submit an IND or IND-equivalent for NTLA-2002 in the second half of 2021.

In Vivo Research Programs

We continue to work on various liver-focused programs, such as hemophilia A and hemophilia B, which we are co-developing with Regeneron, primary hyperoxaluria type 1, alpha-1 antitrypsin deficiency, as well as other liver targets, which are worked on both independently and in partnership with Regeneron, which leverage our capabilities to knockout, insert and make consecutive edits to the genome.

In September 2020, we presented data that showed the persistence of in vivo CRISPR/Cas9 edits in regenerated liver tissue, both knockout and insertion, and corresponding durability of effect following a partial hepatectomy (“PHx”) and liver regrowth in a murine model.

Unlike traditional gene therapy, for which a significant loss (over 80%) in transgene expression was observed in the insertion PHx model, our targeted gene insertion approach yielded durable edits, with no significant loss in expression.

In addition, we have developed combination approaches for delivering the editing machinery by LNP, and the repair and insertion templates by adeno-associated virus (“AAV”) vectors.

For example, at the Alpha-1 Foundation’s 20 th Gordon L.

Snider Critical Issues Workshop:

The Promise of Gene-Based Interventions of Alpha-1 Antitrypsin Deficiency, we demonstrated expression of physiological protein levels of human alpha-1 antitrypsin (“AAT”) in NHPs following a single administration.

Compared to traditional AAV gene therapy, our targeted liver gene insertion technology has the ability to achieve therapeutic levels of protein expression, in a stable and durable manner, after a single dose of treatment.

We are further investigating delivery strategies that target tissues outside of the liver.

For example, at the Keystone eSymposium:

Precision Engineering of the Genome, Epigenome and Transcriptome in March 2021, we presented preclinical data establishing proof-of-concept for non-viral genome editing of bone marrow and HSCs in mice.

This represented our first demonstration of systemic in vivo genome editing in bone marrow using our proprietary non-viral delivery platform.

These results extend our modular in vivo capabilities to treat inherited blood disorders such as sickle cell disease.

Ex Vivo Programs

We are independently researching and developing proprietary engineered cell therapies to treat various oncological and autoimmune diseases, for example TCR-engineered T cells for immuno-oncology applications and engineered regulatory T cells for autoimmune disorders.

We are independently researching and developing proprietary engineered cell therapies to treat various oncological and other disease indications, for example TCR-engineered T cells and chimeric antigen receptor T (“CAR-T”) cells for immuno-oncology applications and engineered regulatory T cells for autoimmune disorders.

Our diverse product strategy includes multiple elements.

In particular:

We are exploring non-CAR-T cellular approaches that use immune cells, including T cells expressing recombinant TCRs, for oncology indications.

For example, in our existing collaboration with IRCCS Ospedale San Raffaele (“OSR”), a leading European research-university hospital, we have identified optimized TCRs that recognize a WT1 target that could be used to treat a variety of cancers.

We are developing TCR-engineered T cells as immuno-oncological therapies.

For example, in our existing collaboration with Ospedale San Raffaele, Milan, a leading European research-university hospital, we have identified optimized TCRs that recognize a tumor target, Wilms’ Tumor 1 (“WT1”) , that could be used to treat a variety of blood cancers and solid tumors;

We seek to develop allogeneic cellular therapies, which are those derived from unmatched donors and modified outside of the human body to allow them to be administered to an unrelated patient.

We are also exploring methods to apply CRISPR/Cas9 editing to CD4 immune cells to induce a non-reverting regulatory T cell phenotype, to create therapies that address autoimmune diseases.

In addition, based on our collaboration and technology, Novartis is developing therapies using CAR-T cells for oncology indications, as well as HSC and OSC-based therapies for a variety of diseases.

These therapies could be used to treat both oncological and immunological diseases;

We are also exploring methods to apply CRISPR/Cas9 editing to cluster of differentiation 4 (“CD4”) immune cells to induce a non-reverting regulatory T cell phenotype, to create therapies that address autoimmune diseases.

In addition, our partner Novartis is developing therapies directed to selected targets using CAR-T cells for oncology indications, as well as HSC and ocular stem cell- (“OSC”) based therapies.

Acute Myeloid Leukemia (“AML”)

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AML is the most common acute leukemia in adults and is associated with the largest number of annual deaths from leukemia in the U.S.

It is estimated that there have been nearly 11,000 deaths due to AML, as well as over 21,000 new AML cases in the U.S.

It is estimated that there were over 11,000 deaths due to AML, as well as nearly 20,000 new AML cases in the U.S.

While AML can occur at any age, the prevalence of the disease increases with age, resulting in a median age at diagnosis of 68 years.

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While these treatments have led to improvements in response rates and in some cases increased overall survival, the outcomes demonstrated thus far have been incremental in nature and long-term outcomes in AML continue to be extremely poor.

We have nominated NTLA-5001 as our first engineered T cell therapy development candidate for the treatment of AML, utilizing our TCR-directed approach to target the WT1 intracellular antigen.

Our WT1-directed TCR T-cell therapy aims to develop a broadly applicable treatment for AML, regardless of mutational subtypes of a patient’s leukemia.

This approach employs CRISPR/Cas9 complexes to knock out and replace the endogenous TCR with a natural, high affinity therapeutic TCR.

NTLA-5001 is our engineered T cell therapy development candidate for the treatment of AML, utilizing our TCR-directed approach to target the WT1 intracellular antigen.

As WT1 is overexpressed in >90% of AML blasts, we are developing NTLA-5001 as a broadly applicable treatment for AML, regardless of mutational subtypes of a patient’s leukemia.

This approach employs CRISPR/Cas9 complexes to knock out and replace the patient’s endogenous TCR with a natural, high avidity therapeutic TCR.

The resulting cells are engineered to be capable of specific and potent killing of AML blasts without bone marrow cell toxicity.

In February 2020, we presented data demonstrating that the selection of a natural, high-affinity TCR, in combination with our CRISPR-enabled engineering and targeted insertion, results in an engineered T cell capable of specific and potent killing of primary AML blasts.

Importantly, our studies showed that CRISPR-enabled engineering overcomes key challenges of traditional TCR approaches, such as mispairing between therapeutic and endogenous TCR, therefore creating a more homogenous T cell product.

The cells engineered with our lead WT1 TCR also exhibited no detectable reactivity to bone marrow cells, which express WT1 at low levels.

In May 2020, we presented data on our proprietary T cell engineering process in support of NTLA-5001.

The data presented showed that our proprietary process enables multiple, highly efficient, sequential edits in T cells, whether knocking out or inserting genes.

This technology yields engineered cells with high anti-tumor activity and favorable attributes, including a desired memory phenotype, which is associated with longer lasting treatment effects.

Importantly, chromosomal translocations (i.e., undesired chromosomal rearrangements) were similar to background levels in untreated cells.

We continue to advance IND-enabling activities and we are on track to submit an IND or IND-equivalent for NTLA-5001 in the first half of 2021.

Research Collaboration with Novartis

In December 2019, the research term under our collaboration agreement with Novartis ended, although the 2014 Novartis Agreement remains in effect.

Accordingly, Novartis has selected various CAR-T cell, HSC and OSC targets for continued development, for which we will be eligible to receive milestone and royalty payments in the future.

Further, we are eligible to earn up to $230.3 million in development, regulatory and sales-based milestone payments and mid-single-digit royalties, in each case, on a per-product basis for the products developed by Novartis, subject to certain target-based limitations.

During the first quarter of 2020, the U.S.

Food and Drug Administration (“FDA”) accepted the IND application submitted by Novartis, for a CRISPR/Cas9-based engineered cell therapy for the treatment of sickle cell disease.

As a result of meeting this milestone, we recognized a $5.0 million milestone payment that was previously constrained as collaboration revenue within the condensed consolidated statement of operations and comprehensive loss.

Novartis is currently actively recruiting patients for its Phase 1/2 study of QTQ923 and HIX763, both candidates which were developed under the research collaboration.

For more information regarding our collaboration with Novartis, see the section below entitled “Collaborations - Novartis.”

Other Research Programs

We are pursuing a number of in vivo and ex vivo genome editing programs.

Within our in vivo research efforts, we continue to work on programs such as primary hyperoxaluria Type 1, alpha-1 antitrypsin deficiency, hemophilia A and hemophilia B which leverage our capabilities to knockout, insert and make consecutive edits to the genome.

We are also investigating delivery strategies that target tissues outside of the liver.

Within our ex vivo research efforts, we are developing engineered cell therapies to treat a range of hematological and solid tumors.

In December 2020, we presented data on NTLA-5001 highlighting the high anti-tumor activity observed in proof-of-concept mouse models of acute leukemias and the faster expansion and superior function of T cells manufactured by our proprietary approach, compared to T cells engineered with a standard genome editing process.

We expect to submit an IND or IND-equivalent for NTLA-5001 in mid-2021.

This first-in-human trial intends to evaluate safety and activity in patients with persistent or recurrent AML who have previously received first-line therapies.

Additional research efforts are underway to evaluate the potential use of NTLA-5001 to treat WT1-positive solid tumors.

Ex Vivo Research Programs

We are developing engineered cell therapies to treat a range of hematological and solid tumors.

We are pursuing modalities, such as TCR, with broad potential in multiple indications.

Further, we continue to advance efforts to move from autologous to allogeneic and from liquid to solid tumors.

Our researchers are developing and improving cell-engineering manufacturing and delivery processes that, we believe, are designed to allow us to deliver T cell therapies with high levels of editing, achieve robust levels of expansion, ensure desirable memory phenotypes, improve function and reduce translocations.

These platform advances will support NTLA-5001 and other ongoing research programs.

We continue to advance efforts to move from autologous to allogeneic therapies and from liquid to solid tumors.

Our researchers are developing and improving cell-engineering manufacturing and delivery processes that, we believe, may allow us to deliver T cell therapies with high levels of editing, robust levels of cell expansion, desirable memory phenotypes, improved function and no translocations above background levels.

Our proprietary T cell engineering process enables multiple, sequential gene edits and is a significant improvement over standard engineering processes commonly used to introduce proteins and nucleic acids into cells.

These platform advances support NTLA-5001 and other ongoing engineered cell research programs.

At the seventh annual Cold Spring Harbor Laboratory virtual scientific meeting in March 2021, we presented our first preclinical data set on our novel, proprietary cytosine deaminase base editor technology.

We demonstrated the technology’s potential for enhanced cell engineering, with multiple simultaneous gene knockouts achieving >90% T cell editing efficiency and no detectable increase in translocation above background levels.

Novartis-Led Sickle Cell Disease and Other Research Programs

In December 2019, the research term under our collaboration agreement with Novartis entered into in 2014 (the “2014 Novartis Agreement”) ended, although the 2014 Novartis Agreement remains in effect.

Under the 2014 Novartis Agreement, Novartis has selected particular CAR-T cell, HSC and OSC targets for continued development.

Novartis has initiated clinical studies for OTQ923 and HIX763, two therapeutic candidates, based on CRISPR/Cas9 editing of HSCs, that resulted from our research collaboration with them.

Novartis is currently recruiting patients for its Phase 1/2 study of these investigational candidates for treatment of sickle cell diseases.

Novartis is developing several other product candidates arising from the 2014 Novartis Agreement.

For more information regarding our collaboration with Novartis, see the section below entitled “ Collaborations - Novartis Institutes for BioMedical Research, Inc.”

Collaborations

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The collaboration expansion builds upon the jointly developed targeted transgene insertion capabilities designed to durably restore a missing therapeutic protein, and to overcome the limitations of traditional gene therapy.

The collaboration has been extended until April 2024, at which point Regeneron has an option to renew for an additional two years.

The collaboration was extended until April 2024, at which point Regeneron has an option to renew for an additional two years.

The 2020 Regeneron Amendment also grants Regeneron rights to develop products for five additional in vivo CRISPR/Cas-based therapeutic liver targets and non-exclusive rights to independently develop and commercialize up to 10 ex vivo gene edited products made using certain defined cell types.

Through September 3 0 , 20 20 , excluding amounts allocated to Regeneron’s purchase of our common stock, we have recorded $ 145.0 million in upfront payment s under the 2016 Regeneron Agreement and the 2020 Regeneron Amendment and $ 3 3 .

8 million primarily for research and development services under the ATTR Co/Co agreement, a s described in Note 7 to our condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q .

Through September 3 0 , 20 20 , we have recognized $ 116.

7 million of collaboration revenue under all arrangements , including $ 22.

2 million and $ 46.

4 million during the three and nine months ended September 30, 2020 and $ 5.8 million and $1 7.8 million during the three and nine months ended September 30, 2019, respectively , in the condensed consolidated statements of operations and comprehensive loss .

This includes $ 1 .

2 million and $ 9 .

8 million during the three and nine months ended September 30, 2020, respectively, and $ 2.6 million and $ 8.4 million during the three and nine months ended September 30, 2019 , respectively, primarily representing payments due from Regeneron pursuant to the ATTR Co / Co a greement , which is accounted for under Accounting Standards Codification 808 , Collaborative Arrangements .

As of September 3 0 , 20 20 and December 31, 201 9 , we had accounts receivable of $ 1 .

2 million and $ 3 .6 million, respectively, and deferred revenue of $ 79.6 million and $ 28.8 million , respectively, related to th ese a r range ment s .

Through March 31, 2021, excluding the amounts allocated to Regeneron’s purchase of our common stock, we have recorded $145.0 million in upfront payments under the 2016 Regeneron Agreement and the 2020 Regeneron Amendment (the “Amended Agreements”) and $35.6 million primarily for research and development services under the ATTR Co/Co agreement, as described in Note 7 to our condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q.

Through March 31, 2021, we have recognized $129.7 million of collaboration revenue under all arrangements, including $6.4 million and $7.9 million during the three months ended March 31, 2021 and 2020, respectively, in the condensed consolidated statements of operations and comprehensive loss.

This includes $0.9 million and $4.8 million during the three months ended March 31, 2021 and 2020, respectively, primarily representing payments due from Regeneron pursuant to the ATTR Co/Co agreement, which is accounted for under Accounting Standards Codification 808, Collaborative Arrangements .

As of March 31, 2021, and December 31, 2020, we had accounts receivable of $1.0 million and $2.1 million, respectively, and deferred revenue of $68.4 million and $73.9 million, respectively, related to these arrangements.

As described in Note 7, “Collaborations—Novartis Institutes for BioMedical Research, Inc.,” to our condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q, i n December 2014, we entered into a strategic collaboration agreement with Novartis (the “2014 Novartis Agreement”), primarily focused on the development of new ex vivo CRISPR/Cas9-edited therapies using CAR-T cells and HSCs.

The agreement was amended in December 2018 (the “Novartis Amendment”) to also include research on OSCs.

Through September 30, 2020, excluding amounts allocated to Novartis’ purchase of the Company’s Class A-1 and Class A-2 Preferred Units, we had recorded a total of $62.4 million in cash under the 2014 Novartis Agreement and the Novartis Amendment.

Through September 30, 2020, we have recognized $62.4 million of collaboration revenue, including $5.0 million related to a development milestone that was recognized in the first quarter of 2020 and $4.8 million and $14.3 million in the three and nine months ended September 30, 2019, respectively.

No collaboration revenue was recorded during the three months ended September 30, 2020, related to the 2014 Novartis Agreement and the Novartis Amendment.

As of September 30, 2020, we had no accounts receivable related to the 2014 Novartis Agreement and the Novartis Amendment.

As of December 31, 2019, we had accounts receivable of $1.0 million related to the 2014 Novartis Agreement and the Novartis Amendment.

As of September 30, 2020 and December 31, 2019, we had no deferred revenue related to the 2014 Novartis Agreement and the Novartis Amendment.

In December 2019, per the terms of the 2014 Novartis Agreement, the research term ended, although the 2014 Novartis Agreement remains in effect, for which we will be eligible to receive milestone and royalty payments in the future.

Since December 31, 2020, there have been no material changes to the key terms of the 2014 Novartis Agreement and the Novartis Amendment.

For further information on the terms and conditions of these agreements, please see the notes to the consolidated financial statements included in our Annual Report for the year ended December 31, 2020.

Revenue Recognition – Milestone .

During the three months ended March 31, 2020, the U.S.

Food and Drug Administration (“FDA”) accepted the IND application submitted by Novartis for a CRISPR/Cas9-based engineered cell therapy for the treatment of sickle cell disease.

As a result of meeting this milestone, we recognized $5.0 million as collaboration revenue within the condensed consolidated statement of operations and comprehensive loss.

No other milestones under the 2014 Novartis Agreement and the Novartis Amendment were achieved during the three months ended March 31, 2021 or 2020.

We are eligible to receive additional downstream success-based milestones and royalties.

As of March 31, 2021 and December 31, 2020, we had no accounts receivable or deferred revenue related to the 2014 Novartis Agreement and the Novartis Amendment.

Financial Overview

Collaboration Revenue

Our revenue consists of collaboration revenue, including amounts recognized related to upfront technology access payments for licenses, technology access fees, research funding and milestone payments earned under our collaboration and license agreements with Novartis and Regeneron.

Research and Development

Research and development expenses consist of expenses incurred in performing research and development activities, including compensation and benefits, which includes equity-based compensation, for full-time research and development employees, allocated facility-related expenses, overhead expenses, clinical manufacturing costs, license and milestone fees, contract research services and other related costs.

Research and development expenses consist of expenses incurred in performing research and development activities, such as compensation and benefits, which includes equity-based compensation, for full-time research and development employees, allocated facility-related expenses, overhead expenses, license and milestone fees, contract research, development and manufacturing services, and other related costs.

General and Administrative

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Interest Income

Interest income is income earned on our cash, cash equivalents and marketable securities.

Interest income is income earned on our cash, cash equivalents, restricted cash equivalents and marketable securities.

Results of Operations

The following discussion of the financial condition and results of operations should be read in conjunction with the accompanying condensed consolidated financial statements and the related footnotes thereto.

Comparison of Three Months Ended September 30 , 2020 and 2019

The following table summarizes our results of operations for the three months ended September 30, 2020 and 2019:

Three Months Ended September 30,

Comparison of Three Months Ended March 31 , 2021 and 2020

The following table summarizes our results of operations for the three months ended March 31, 2021 and 2020:

Three Months Ended March 31,

Period Change

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Collaboration Revenue

Collaboration revenue increased $11.6 million to $22.2 million during the three months ended September 30, 2020, as compared to $10.6 million during the three months ended September 30, 2019.

The increase in collaboration revenue during the three months ended September 30, 2020 is primarily due to the Company recording $15.3 million related to the transfer of control of the license to develop the Factor VIII target for hemophilia A, partially offset by a decrease in revenue related to the Novartis collaboration.

Collaboration revenue decreased by $6.5 million to $6.4 million during the three months ended March 31, 2021, as compared to $12.9 million during the three months ended March 31, 2020.

The decrease in collaboration revenue during the three months ended March 31, 2021 is primarily driven by the $5.0 million milestone payment earned from Novartis for the IND submission of OTQ923 in 2020.

Refer to Note 7 to our condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q for further details.

Research and Development

Research and development expenses increased by $12.2 million to $39.8 million during the three months ended September 30, 2020, as compared to $27.5 million during the three months ended September 30, 2019.

The following table summarizes our research and development expenses for the three months ended September 30, 2020 and 2019, together with the changes in those items in dollars (in thousands) and the respective percentages of change:

Three Months Ended September 30,

Research and development expenses increased by $4.6 million to $39.3 million during the three months ended March 31, 2021, as compared to $34.7 million during the three months ended March 31, 2020.

The following table summarizes our research and development expenses for the three months ended March 3 1 , 202 1 and 20 20 , together with the changes in those items in dollars (in thousands) and the respective percentages of change:

Three Months Ended March 31,

Period Change

Pipeline and platform development

External development expenses by program:

Unallocated research and development expenses:

Employee-related expenses

Allocated facility-related expenses

Stock-based compensation expense

Other expenses

Research materials and contracted services

Facility-related expenses

Stock-based compensation

Total research and development expenses

The increase in research and development expenses for the three months ended September 30, 2020 compared to the three months ended September 30, 2019 was primarily attributable to:

approximately $7.4 million in increased pipeline and platform development expenses driven by increased costs as we prepared to enter the clinic for NTLA-2001, increased preclinical studies for NTLA-2002 and NTLA-5001, and an upfront payment associated with a research collaboration and licensing agreement;

approximately $ 2.9 million in employee - related expenses driven by an increase in the size of our workforce due to the advancement of our programs ;

approximately $0.8 million in increased facility-related expenses primarily related to rent, depreciation and technology expense allocated to research and development;

approximately $1.3 million in increased stock-based compensation driven by our larger workforce.

Through 2020, we expect research and development expenses to increase as we continue to grow our development team, execute clinical trials for ATTR and advance our AML and HAE programs towards clinical development.

The increase in research and development expenses for the three months ended March 31, 2021 compared to the three months ended March 31, 2020 was primarily attributable to:

a $4.7 million decrease in external costs related to the development of NTLA-2001, our lead product candidate, primarily due to a decrease in contracted services and manufactured components incurred as compared to the prior period;

a $1.3 million increase in external costs related to the development of NTLA-2002, primarily due to an increase in components as we prepare to enter into the clinic;

a $2.9 million increase in external costs related to the development of NTLA-5001, primarily due to an increase in contracted services as we prepare to enter into the clinic;

a $3.0 million increase in employee-related expenses driven by an increase in the size of our workforce due to the advancement of our programs;

a $1.1 million increase in research materials and contracted services primarily due to an increase in purchased materials;

a $0.2 million increase in facility-related expenses primarily related to rent, depreciation and technology expense allocated to research and development;

a $1.3 million increase in stock-based compensation driven by our larger workforce and stock valuation.

Through 2021, we expect research and development expenses to increase as we continue to grow our development team, execute clinical trials for ATTR and progress our AML and HAE programs into the clinic.

General and Administrative

General and administrative expenses increased by approximately $2.1 million to $10.6 million during the three months ended September 30, 2020, compared to $8.4 million during the three months ended September 30, 2019.

General and administrative expenses increased by $2.3 million to $13.6 million during the three months ended March 31, 2021, compared to $11.3 million during the three months ended March 31, 2020.

This increase was primarily related to employee-related expenses, including stock-based compensation of $0.9 million.

Interest Income

Interest income decreased by approximately $1.4 million to $0.3 million during the three months ended September 30, 2020 as compared to $1.7 million during the three months ended September 30, 2019.

This decrease was due to a decline in investment income due to market conditions.

Comparison of Nine Months Ended September 30 , 2020 and 2019

The following table summarizes our results of operations for the nine months ended September 30, 2020 and 2019:

Nine Months Ended September 30,

Period Change

Collaboration revenue

Operating expenses:

Research and development

General and administrative

Total operating expenses

Operating loss

Interest income

Collaboration Revenue

Collaboration revenue increased approximately $19.2 million to $51.4 million during the nine months ended September 30, 2020, as compared to $32.2 million during the nine months ended September 30, 2019.

The increase in collaboration revenue during the nine months ended September 30, 2020 is primarily caused by an $8.4 million one-time cumulative catch-up adjustment related to the modification of the 2016 Regeneron Agreement as well as $15.3 million recorded due to the transfer of control of the license to develop the Factor VIII target for hemophilia A, partially offset by a decrease in revenue related to the Novartis collaboration.

Refer to Note 7 to our condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q for further details.

Research and Development

Research and development expenses increased by approximately $35.5 million to $112.2 million during the nine months ended September 30, 2020, as compared to $76.7 million during the nine months ended September 30, 2019.

The following table summarizes our research and development expenses for the nine months ended September 3 0 , 2020 and 2019, together with the changes in those items in dollars (in thousands) and the respective percentages of change:

Nine Months Ended September 30,

Period Change

Pipeline and platform development

Employee-related expenses

Allocated facility-related expenses

Stock-based compensation expense

Other expenses

Total research and development expenses

The increase in research and development expenses for the nine months ended September 30, 2020 compared to the nine months ended September 30, 2019 was primarily attributable to :

approximately $22.2 million in increased pipeline and platform development expenses driven by increased manufacturing and related costs as we prepared to file our CTA and enter the clinic for NTLA-2001, increased preclinical studies for NTLA-2002 and NTLA-5001, and upfront payments associated with a research collaboration and licensing agreement;

approximately $8.9 million in employee-related expenses driven by an increase in the size of our workforce due to the advancement of our programs;

approximately $2.7 million in increased facility-related expenses primarily related to rent, depreciation and technology expense allocated to research and development;

approximately $1.9 million in increased stock-based compensation driven by our larger workforce.

General and Administrative

General and administrative expenses increased by approximately $1.3 million to $33.4 million during the nine months ended September 30, 2020, compared to $32.1 million during the nine months ended September 30, 2019.

This increase was primarily related to a $3.2 million increase in employee-related expenses offset by a decrease in legal expenses of $2.3 million.

Interest Income

Interest income decreased by approximately $3.2 million to $2.1 million during the nine months ended September 30, 2020 as compared to $5.3 million during the nine months ended September 30, 2019.

Interest income decreased by $1.0 million to $0.2 million during the three months ended March 31, 2021 as compared to $1.2 million during the three months ended March 31, 2020.

This decrease was due to a decline in investment income due to market conditions.

Liquidity and Capital Resources

Since our inception through September 30, 2020, we have raised an aggregate of $893.6 million to fund our operations, of which $272.6 million was through our collaboration agreements, $170.5 million was from our initial public offering and concurrent private placements, $249.1 million was from follow-on public offerings, $116.4 million was from at-the-market offerings and $85.0 million was from the sale of convertible preferred stock.

As of September 3 0 , 20 20 , we had $ 4 07.9 million in cash, cash equivalents and marketable securities.

Since our inception through March 31, 2021, we have raised an aggregate of $1,165.3 million to fund our operations, of which $275.0 million was through our collaboration agreements, $170.5 million was from our initial public offering and concurrent private placements, $438.3 million was from follow-on public offerings, $196.5 million was from at-the-market offerings and $85.0 million was from the sale of convertible preferred stock.

As of March 31, 2021, we had $600.8 million in cash, cash equivalents and marketable securities.

We are entitled to receive research payments under our collaboration with Novartis and are also eligible to earn a significant amount of milestone payments and royalties, in each case, on a per-product basis under our collaboration with Novartis and on a per-target basis under our collaboration with Regeneron.

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Our rights to payments under our collaboration agreements are our only committed external source of funds.

Follow-on Offering

On June 1, 2020, we entered into an underwriting agreement related to a public offering of 6,301,370 shares of our common stock, par value $0.0001 per share, including the exercise in full by the underwriters of their option to purchase an additional 821,917 shares, at the public offering price of $18.25 per share.

The offering closed on June 5, 2020 and we received net proceeds of $107.7 million, after deducting the underwriting discount, commissions and approximately $0.4 million in offering expenses.

Shares Issued in Private Placement to Regeneron

As described in Note 7 to our condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q, in May 2020 we entered into the 2020 Regeneron Amendment.

Simultaneously with the 2020 Regeneron Amendment, we and Regeneron entered into the 2020 Stock Purchase Agreement , under which we sold to Regeneron 925,218 shares of our common stock, par value $0.0001 per share, for aggregate cash consideration of $30.0 million, or $32.42 per share, representing a 100% premium over the volume-weighted average trading price of our common stock during the 30-day period prior to the closing.

Under the 2020 Stock Purchase Agreement, Regeneron will not dispose of any shares of common stock it beneficially owns in Intellia until the termination of the Technology Collaboration Term (see Note 7).

After applying equity accounting guidance to measure the issuance of the shares, $12.6 million was recorded as fair value in the condensed consolidated statement of stockholders’ equity for the shares.

At-the-Market Offering Programs

In October 2018, we entered into an Open Market Sale Agreement (the “2018 Sales Agreement”) with Jefferies LLC (“Jefferies”), under which Jefferies was able to offer and sell, from time to time in “at-the-market” offerings, shares of our common stock having aggregate gross proceeds of up to $100.0 million.

We paid to Jefferies cash commissions of 3.0% of the gross proceeds of sales of common stock under the 2018 Sales Agreement.

We issued 5,890,648 shares of our common stock at an average price of $16.98 per share in accordance with the 2018 Sales Agreement for aggregate net proceeds of $96.4 million, after payment of cash commissions to Jefferies and approximately $0.6 million related to legal, accounting and other fees in connection with the sales.

All shares related to the 2018 Sales Agreement had been sold as of December 31, 2019 .

In August 2019, we entered into an Open Market Sale Agreement (the “2019 Sales Agreement”) with Jefferies, under which Jefferies is able to offer and sell, from time to time in “at-the-market” offerings, shares of our common stock having aggregate gross proceeds of up to $150.0 million.

We agreed to pay to Jefferies cash commissions of 3.0% of the gross proceeds of sales of common stock under the 2019 Sales Agreement.

During the year ended December 31, 2019, we issued 287,231 shares of our common stock, in a series of sales, at an average price of $ 16.48 per share, in accordance with the 2019 Sales Agreement for aggregate net proceeds of $ 4.4 million, after payment of cash commissions to Jefferies and approximately $0.2 million related to legal, accounting and other fees in connection with the sales .

During the nine months ended September 30, 2020, we issued 1,107,100 shares of our common stock in a series of sales at an average price of $13.78 per share in accordance with the 2019 Sales Agreement, for aggregate net proceeds of $14.7 million after payment of cash commissions to Jefferies and approximately $0.1 million related to legal, accounting and other fees in connection with the sales.

As of September 30, 2020, $130.0 million in shares of common stock remain eligible for sale under the 2019 Sales Agreement.

During the three months ended March 31, 2021, we issued 641,709 shares of our common stock in a series of sales at an average price of $72.79 per share in accordance with the 2019 Sales Agreement, for aggregate net proceeds of $45.3 million after payment of cash commissions to Jefferies and approximately $0.1 million related to legal, accounting and other fees in connection with the sales.

As of March 31, 2021, $47.4 million in shares of common stock remain eligible for sale under the 2019 Sales Agreement.

Funding Requirements

Our primary uses of capital are, and we expect will continue to be, research and development contracted services, compensation and related expenses, laboratory and office facilities, research supplies, legal and regulatory expenses, patent prosecution filing and maintenance costs for our licensed IP and general overhead costs.

During 2020, we expect our expenses to increase compared to prior periods in connection with our ongoing activities, as we continue to grow our research and development team and begin clinical development.

Because our lead programs are still in the discovery, preclinical or early clinical stage and the outcome of these efforts is uncertain, we cannot estimate the actual amounts necessary to successfully complete the development and commercialization of any future product candidates or whether, or when, we may achieve profitability.

During 2021, we expect our expenses to increase compared to prior periods in connection with our ongoing activities as we continue to grow our research and development team and advance additional programs into clinical development.

Because our lead programs are still in the preclinical or early clinical stage and the outcome of these efforts is uncertain, we cannot estimate the actual amounts necessary to successfully complete the development and commercialization of any future product candidates or whether, or when, we may achieve profitability.

Until such time as we can generate substantial product revenues, if ever, we expect to finance our ongoing cash needs through equity financings and collaboration arrangements.

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If we are unable to raise additional funds through equity 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.

Based on our research and development plans and our expectations related to the progress of our programs, we expect that our cash, cash equivalents and marketable securities as of September 30, 2020, as well as research and cost reimbursement funding from Regeneron, will enable us to fund our ongoing operating expenses and capital expenditure requirements at least through the next twenty-four months, excluding any potential mile stone payments or extension fees that could be earned and distributed under the collaboration agreements with Regeneron and Novartis or any strategic use of capital not currently in the base case planning assumptions.

Based on our research and development plans and our expectations related to the progress of our programs, we expect that our cash, cash equivalents and marketable securities as of March 31, 2021, as well as research and cost reimbursement funding from Regeneron, will enable us to fund our ongoing operating expenses and capital expenditure requirements at least through the next twenty-four months, excluding any potential mile stone payments or extension fees that could be earned and distributed under the collaboration agreements with Regeneron and Novartis or any strategic use of capital not currently in the base case planning assumptions.

We have based this estimate on current assumptions that may prove to be wrong, and we could use our capital resources sooner than we expect.

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and attracting, hiring, and retaining qualified personnel .

The following is a summary of cash flows for the nine months ended September 30, 2020 and 2019:

Nine Months Ended September 30,

(In thousands)

The following is a summary of cash flows for the three months ended March 31, 2021 and 2020:

Three Months Ended March 31,

(In millions)

Net cash used in operating activities

Net cash used in investing activities

Net cash (used in) provided by investing activities

Net cash provided by financing activities

Net cash used in operating activities

Net cash used in operating activities of $9.7 million during the nine months ended September 30, 2020 primarily reflects the receipt of a $70.0 million up-front payment and $12.2 million in additional payments under our collaboration with Regeneron and $6.0 million in payments from Novartis, offset in part by increased spend in our research and development activities.

Net cash used in operating activities of $74.6 million during the nine months ended September 30, 2019 primarily reflects increased spend in our research and development and general administrative activities, offset in part by the receipt of $8.0 million and $7.3 million in payments from our collaboration partners, Novartis and Regeneron, respectively, during those periods.

Net cash used in investing activities

During the nine months ended September 30, 2020 and 2019, our investing activities used net cash of $3.6 million and $2.7 million, respectively.

The decrease in the nine months ended September 30, 2020 is primarily related to the use of $2.6 million in cash for the purchase of property and equipment and a decrease of $1.0 million from marketable securities activity during the period, as $243.8 million in marketable securities matured and $244.8 million in marketable securities were purchased.

The decrease in the nine months ended September 30, 2019 is primarily related to the use of $4.2 million in cash for the purchase of property and equipment, offset in part by an increase of $1.5 million from marketable securities activity during the period, as $265.5 million in marketable securities matured and $264.0 million in marketable securities were purchased.

Net cash used in operating activities of $52.4 million during the three months ended March 31, 2021 primarily reflects the increased spend in our research and development activities, offset in part by the receipt of $2.4 million in payments from our collaboration partners during those periods.

Net cash used in operating activities of $38.5 million during the three months ended March 31, 2020 primarily reflects increased spend in our research and development activities, offset in part by the receipt of $1.0 million in payments from our collaboration partners during those periods.

Net cash (used in) provided by investing activities

During the three months ended March 31, 2021, our investing activities used net cash of $25.5 million.

The decrease in the three months ended March 31, 2021 is primarily due to a decrease in marketable securities activity during the period, as $148.3 million in marketable securities were purchased and $125.2 million in marketable securities matured.

The decrease in cash is also due to $2.4 million for the purchase of property and equipment during the period.

The increase in the three months ended March 31, 2020 is primarily due to an increase of $58.3 million in marketable securities activity during the period, as $89.5 million in marketable securities matured and $31.2 million in marketable securities were purchased.

This increase in cash was offset in part by the use of $0.8 million in cash for the purchase of property and equipment during the period.

Net cash provided by financing activities

Net cash provided by financing activities of $137.7 million during the nine months ended September 30, 2020 includes $107.7 million in net proceeds from a follow-on offering, $14.7 million in net proceeds from at-the-market offerings, $12.6 million in proceeds from the issuance of common stock to Regeneron in a private placement, $2.0 million in cash received from the exercise of stock options and $0.7 million in cash received from the issuance of shares through our employee stock purchase plan.

Net cash provided by financing activities of $56.9 million during the nine months ended September 30, 2019 includes $54.1 million in net proceeds from at-the-market offerings, $2.2 million in cash received from the exercise of stock options and $0.5 million in cash received from the issuance of shares through our employee stock purchase plan.

Net cash provided by financing activities of $58.6 million during the three months ended March 31, 2021 includes $45.3 million in net proceeds from at-the-market offerings and $13.3 million in cash received from the exercise of stock options.

Net cash provided by financing activities of $4.9 million during the three months ended March 31, 2020 includes $4.5 million in net proceeds from at-the-market offerings and $0.3 million in cash received from the exercise of stock options.

Critical Accounting Policies

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Contractual Obligations

In March 2020, we entered into a second amendment to the 130 Brookline Lease (the “Second Amendment”).

The Second Amendment amends certain terms of our existing lease, dated October 21, 2014, as amended on April 5, 2019.

The Second Amendment extends the term of the 130 Brookline Lease by approximately six years through January 31, 2031.

This extended term is included as part of the lease liability and right-of-use asset at September 30, 2020.

The Second Amendment also provides an option to extend the lease for two consecutive five-year terms.

We recognized a right-of-use asset and lease liability of approximately $7.3 million related to the Second Amendment.

In March 2020, we entered into an agreement to lease approximately 39,000 square feet of office and laboratory space at 281 Albany Street in Cambridge, Massachusetts under an operating lease agreement (the “281 Albany Lease”).

Our obligation to pay rent on the 281 Albany Lease will start on the date that is six months after the commencement date or the date on which we occupy the premises, whichever occurs earlier (the “Rent Commencement Date”).

The initial term of the 281 Albany Lease is ten years following the Rent Commencement Date.

The base rent under the 281 Albany Lease is $99.00 per square foot per year during the first year of the term, which is subject to scheduled annual increases up to $128.87 per square foot per year during the last year of the initial term, plus certain operating expenses and taxes.

In addition, the landlord will contribute an

aggregate of $4.4 million toward the cost of construction and tenant improvements for the p remises.

We have the option to extend the 281 Albany Lease for two successive five-year terms .

There were no other material changes to our contractual obligations during the nine months ended September 30, 2020.

There were no material changes to our contractual obligations during the three months ended March 31, 2021.

For a complete discussion of our contractual obligations, please refer to our Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report for the year ended December 31, 2020.

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis