What changed in this filing

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Item 2. Management’s Discussion and Analysis

2021-08-09 compared with 2021-05-10 · 148 added, 65 removed, 336 unchanged (39% of the section changed)

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and AG019, which is built on our ActoBiotics platform.

In addition, we recently completed a Phase 1 study of INXN-4001, a non-viral triple-effector plasmid DNA, which is built on our UltraVector platform.

In addition, we have completed a Phase 1 study of INXN-4001, a non-viral triple-effector plasmid DNA, which is built on our UltraVector platform.

We also have a robust pipeline of preclinical programs that we are pursuing in order to drive long-term value creation.

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Our healthcare business focuses on human therapeutics and developing research models and services for healthcare research applications.

Our Biopharmaceuticals segment is operated by our wholly owned subsidiaries PGEN Therapeutics, Inc., or PGEN Therapeutics, and Precigen ActoBio, Inc., or ActoBio, and our majority ownership interest in Triple-Gene LLC, doing business as Precigen Triple-Gene, or Triple-Gene, as well as equity and royalty interests in therapeutics and therapeutic platforms from companies not controlled by us.

Our Biopharmaceuticals segment includes our wholly owned subsidiaries PGEN Therapeutics, Inc., or PGEN Therapeutics, and Precigen ActoBio, Inc., or ActoBio, and our majority ownership interest in Triple-Gene LLC, doing business as Precigen Triple-Gene, or Triple-Gene, as well as royalty interests in therapeutics and therapeutic platforms from companies not controlled by us.

Exemplar Genetics LLC, doing business as Precigen Exemplar, or Exemplar, is a wholly owned subsidiary which is focused on developing research models and services for healthcare research applications.

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We believe that our proprietary gorilla adenovectors, part of the AdenoVerse technology, have superior performance characteristics as compared to current competition, including standard human adenovirus serotype 5, rare human adenovirus types and other non-human primate adenovirus types.

Our most advanced programs within PGEN Therapeutics are as follows:

The most advanced programs within PGEN Therapeutics are as follows:

PRGN-3005 is a first-in-class, investigational autologous CAR-T therapy that utilizes our UltraCAR-T platform to simultaneously express a CAR targeting the unshed portion of the Mucin 16 antigen, mbIL15, and kill switch genes.

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PRGN-2012 is in a Phase 1 clinical trial for adult patients with RRP.

In March 2021, we announced that the first patient was dosed in the PRGN-2012 Phase 1 trial.

PRGN-2012 is being developed in collaboration with the Center for Cancer Research at the NCI pursuant to a CRADA.

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Enrollment and dosing in the Phase 1b and Phase 2a portions of the study are complete.

The primary endpoint of assessing safety and tolerability in the Phase 1b monotherapy portion of the study was met, and preliminary results at six months after AG019 monotherapy treatment initiation showed an encouraging trend in C-peptide levels, a biomarker for T1D disease progression.

Data from the Phase 2a portion showed that the combination was well-tolerated and the preliminary data at six months after treatment initiation showed an encouraging trend in C-peptide levels compared to baseline levels.

The primary endpoint of assessing safety and tolerability in both the Phase 1b monotherapy and the Phase 2a combination arms of the study was met.

No dose-related adverse events or serious adverse events were reported in either portion of this trial.

Interim data presented showed an encouraging trend in C-peptide levels, a biomarker for T1D disease progression, at six months after AG019 monotherapy treatment initiation.

Furthermore, AG019 monotherapy induced antigen-specific tolerance in conjunction with the reduction of disease-specific T cell responses six months post treatment initiation.

The combination of AG019 and teplizumab showed the induction of antigen-specific tolerance in conjunction with reduction of disease-specific T cell responses at six months post treatment initiation.

Precigen Triple-Gene

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A first-in-human, open label Phase 1 trial designed to evaluate the safety of retrograde coronary sinus infusion, or RCSI, of INXN-4001 in outpatient left ventricular assist device, or LVAD, recipients has been completed.

Six-month follow-up data demonstrated that the study met the primary endpoints to evaluate safety and feasibility for INXN-4001, and analysis of the final results is ongoing.

Six-month follow-up data demonstrated that the study met the primary endpoints to evaluate safety and feasibility for INXN-4001.

Partnered Program

We have partnered with Castle Creek Biosciences, Inc.

(formerly Fibrocell Science, Inc.), or Castle Creek, to advance product candidates D-Fi (debcoemagene autoficel), formerly designated FCX-007, for the treatment of recessive dystrophic epidermolysis bullosa, or RDEB, and FCX-013 for the treatment of localized scleroderma.

We have partnered with Castle Creek Biosciences, Inc., or Castle Creek, to advance product candidates D-Fi (debcoemagene autoficel), formerly designated FCX-007, for the treatment of recessive dystrophic epidermolysis bullosa, or RDEB, and FCX-013 for the treatment of localized scleroderma.

In October 2020, Castle Creek announced the dosing of the first patient in the ongoing Phase 3 trial of D-Fi and the dosing of the first patient in the ongoing Phase 1/2 trial of FCX-013.

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In addition, FCX-013 has been granted Rare Pediatric Disease designation and Fast Track designation for the treatment of moderate to severe localized scleroderma.

Pursuant to the collaboration, we licensed our technology platforms to Castle Creek for use in certain specified fields, and in exchange, we received and were entitled to certain access fees, milestone payments, royalties, and sublicensing fees related to the development and commercialization of product candidates.

In March 2020, we and Castle Creek terminated

the original collaboration agreement by mutual agreement, with the parties agreeing that FCX-007 and FCX-013 would be treated as "Retained Products" under the terms of the original agreement.

Pursuant to the collaboration, we licensed our technology platforms to Castle Creek for use in certain specified fields, and in exchange, we received and were

entitled to certain access fees, milestone payments, royalties, and sublicensing fees related to the development and commercialization of product candidates.

In March 2020, we and Castle Creek terminated the original collaboration agreement by mutual agreement, with the parties agreeing that FCX-007 and FCX-013 would be treated as "Retained Products" under the terms of the original agreement.

Castle Creek retains a license to continue to develop and commercialize the Retained Products within the field of use for so long as Castle Creek continues to pursue such development and commercialization, and we are also entitled to certain royalties with respect to the Retained Products.

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Our Non-Healthcare Business

At March 31, 2021, our only non-healthcare business is our established bovine genetics company, Trans Ova Genetics, L.C., or Trans Ova.

At June 30, 2021, our only non-healthcare business is our established bovine genetics company, Trans Ova Genetics, L.C., or Trans Ova.

Trans Ova is internationally recognized as a provider of industry-leading bovine reproductive technologies.

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See "Notes to the Condensed Consolidated Financial Statements (Unaudited) - Note 4" appearing elsewhere in this Quarterly Report for a discussion of Intrexon Energy Partners and Intrexon Energy Partners II.

As of March 31, 2021, our reportable segments were (i) Biopharmaceuticals, (ii) Exemplar, and (iii) Trans Ova.

These identified reportable segments met the quantitative thresholds to be reported separately for the three months ended March 31, 2021.

As of June 30, 2021, our reportable segments were (i) Biopharmaceuticals, (ii) Exemplar, and (iii) Trans Ova.

These identified reportable segments met the quantitative thresholds to be reported separately for the six months ended June 30, 2021.

Corporate expenses, which are not allocated to the segments and are managed at a consolidated level, include costs associated with general and administrative functions, including our finance, accounting, legal, human resources, information technology, corporate communication, and investor relations functions.

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We may enter into strategic transactions for individual platforms or programs in the future from which we may generate new collaboration and licensing revenues.

We continue to generate product and service revenues through our Trans Ova and Exemplar subsidiaries, and in the three months ended March 31, 2021, both of these subsidiaries generated positive Segment Adjusted EBITDA.

We continue to generate product and service revenues through our Trans Ova and Exemplar subsidiaries, and in the six months ended June 30, 2021, both of these subsidiaries generated positive Segment Adjusted EBITDA.

Products currently in our clinical pipeline will require regulatory approval and/or commercial scale-up before they may commence significant product sales and operating profits.

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We generate product and service revenues primarily through sales of products or services that are created from technologies developed or owned by us.

Our primary current offerings arise from Trans Ova and include sales of advanced reproductive technologies, including our bovine embryo transfer and IVF processes and from genetic preservation and sexed semen processes, and applications of such processes to other livestock, as well as sales of livestock and embryos produced using these processes and used in production.

Our primary current revenues arise from Trans Ova and include sales of advanced reproductive technologies, including our bovine embryo transfer and IVF processes and from genetic preservation and sexed semen processes, and applications of such processes to other livestock, as well as sales of livestock and embryos produced using these processes and used in production.

Exemplar also generates product and service revenues through the development and sale of genetically engineered miniature swine models.

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Trans Ova's research and development activities support new and improved product and service offerings for its customers.

The following table summarizes our research and development expenses incurred by reportable segment and reconciles those expenses to research and development expenses on the condensed consolidated statements of operations for the three months ended March 31, 2021 and 2020.

Three Months Ended

June 30, Six Months Ended

2021 2020 2021 2020

Biopharmaceuticals

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We believe these increases will likely include increased costs paid to consultants and contract research organizations and increased costs related to laboratory supplies.

Research and development expenses may also increase as a result of ongoing research and development operations that we might assume through mergers and acquisitions or in-licensing of technologies.

Research and development expenses may also increase as a result of in-licensing of technologies or ongoing research and development operations that we might assume through mergers and acquisitions.

Selling, general and administrative expenses

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Results of operations

Comparison of the three months ended March 31, 2021 and the three months ended March 31, 2020

The following table summarizes our results of operations for the three months ended March 31, 2021 and 2020, together with the changes in those items in dollars and as a percentage:

Comparison of the three months ended June 30, 2021 and the three months ended June 30, 2020

The following table summarizes our results of operations for the three months ended June 30, 2021 and 2020, together with the changes in those items in dollars and as a percentage:

Three Months Ended

March 31, Dollar

June 30, Dollar

Change Percent

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Selling, general and administrative 19,997 17,869 2,128 11.9 %

Impairment of other noncurrent assets 543 — 543 N/A

Total operating expenses 49,254 42,254 7,000 16.6 %

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Loss from continuing operations before income taxes (20,123) (15,829) (4,294) 27.1 %

Income tax benefit (expense) 52 (40) 92 >200%

Income tax benefit 60 120 (60) (50.0) %

Loss from continuing operations (20,063) (15,709) (4,354) 27.7 %

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Net loss $ (20,050) $ (43,354) $ 23,304 (53.8) %

(1) Includes $0 and $198 from related parties for the three months ended March 31, 2021 and 2020, respectively.

(1) Includes $0 and $32 from related parties for the three months ended June 30, 2021 and 2020, respectively.

(2) See "Notes to the Condensed Consolidated Financial Statements (Unaudited) - Note 3" appearing elsewhere in this Quarterly Report.

Collaboration and licensing revenues

Collaboration and licensing revenues decreased $10.7 million, or 99%, from the three months ended March 31, 2020 primarily due to recognition of previously deferred revenue which arose from the termination of a collaboration with Castle Creek in February 2020.

Collaboration and licensing revenues decreased $4.0 million, or 93%, from the three months ended June 30, 2020 primarily due to a decrease in the recognition of previously deferred revenue in the current period resulting from fewer services being performed pursuant to a March 2020 termination agreement with Castle Creek.

Product revenues and gross margin

Product revenues increased $1.4 million, or 29%, over the three months ended March 31, 2020.

Product revenues were comparable to the three months ended June 30, 2020 as expected.

Gross margin on products improved in the current period as a result of increased focus on selling higher margin products, and operational efficiencies that have been gained through reductions in workforce and improved inventory management.

Service revenues and gross margin

Service revenues increased $7.4 million, or 43%, over the three months ended June 30, 2020.

Trans Ova's revenues and gross margins thereon improved primarily due to an increase in services performed as a result of higher customer demand as the beef and dairy industries have been stronger in the current year and a change in pricing structure with certain customers.

Additionally, Exemplar's service revenues and gross margins thereon improved in the current period due to an increase in services performed resulting from a higher demand from existing and new customers as well as a combination of price increases and a change in the pricing structure with certain customers.

Research and development expenses

Research and development expenses increased $4.2 million, or 44%, over the three months ended June 30, 2020.

Contract research organization costs and lab supplies increased $3.8 million with the advancement of our clinical and preclinical programs.

Selling, general and administrative expenses

SG&A expenses increased $2.1 million, or 12%, over the three months ended June 30, 2020.

Professional fees increased $1.8 million primarily due to an increase in legal fees associated with certain current litigation matters.

Segment performance

The following table summarizes Segment Adjusted EBITDA, which is our primary measure of segment performance, for the three months ended June 30, 2021 and 2020, for each of our reportable segments as well as unallocated corporate costs.

Three Months Ended

June 30, Dollar

Change Percent

(In thousands)

Segment Adjusted EBITDA:

Biopharmaceuticals

$ (12,540) $ (7,323) $ (5,217) (71.2) %

Exemplar 1,889 607 1,282 >200%

Trans Ova 12,012 8,125 3,887 47.8 %

Unallocated corporate costs (10,052) (7,812) (2,240) 28.7 %

For a reconciliation of Segment Adjusted EBITDA to net loss from continuing operations before income taxes, see "Notes to the Condensed Consolidated Financial Statements (Unaudited) - Note 19" appearing elsewhere in this Quarterly Report.

The following table summarizes revenues from external customers for the three months ended June 30, 2021 and 2020, for each of our reportable segments.

Three Months Ended

June 30, Dollar

Change Percent

(In thousands)

Biopharmaceuticals

$ 416 $ 4,460 $ (4,044) (90.7) %

Exemplar 3,399 2,105 1,294 61.5 %

Trans Ova 29,765 23,845 5,920 24.8 %

Biopharmaceuticals

The decrease in revenues for Biopharmaceuticals was primarily due to a decrease in the recognition of previously deferred revenue in the current period resulting from fewer services being performed pursuant to a termination agreement with Castle Creek.

Segment Adjusted EBITDA declined as we had increased costs associated with the advancement of our clinical and preclinical programs.

Revenues for Exemplar increased due to an increase in services performed resulting from a higher demand from existing and new customers.

Revenues also increased due to price increases as well as a change in the pricing structure with certain customers.

The improvement in Segment Adjusted EBITDA was primarily due to the increased revenues and reduced costs as a result of operational efficiencies gained through reductions in workforce and improved inventory management.

Revenues for Trans Ova increased primarily due to higher customer demand for pregnant cows and more procedures performed as a result of stronger beef and dairy industries in the current year.

Revenues also increased due to a change in the pricing structure with certain customers.

The improvement in Segment Adjusted EBITDA was primarily due to the increased revenues, as well as reduced costs as a result of operational efficiencies gained through reductions in workforce and improved inventory management.

Unallocated Corporate Costs

Unallocated corporate costs increased primarily due to increased professional fees associated with certain current litigation matters.

Comparison of the six months ended June 30, 2021 and the six months ended June 30, 2020

The following table summarizes our results of operations for the six months ended June 30, 2021 and 2020, together with the changes in those items in dollars and as a percentage:

Six Months Ended

June 30, Dollar

Change Percent

(In thousands)

Collaboration and licensing revenues (1) $ 367 $ 15,036 $ (14,669) (97.6) %

Product revenues 14,716 13,501 1,215 9.0 %

Service revenues 42,734 31,327 11,407 36.4 %

Other revenues 274 398 (124) (31.2) %

Total revenues 58,091 60,262 (2,171) (3.6) %

Operating expenses

Cost of products 11,709 14,230 (2,521) (17.7) %

Cost of services 16,300 14,306 1,994 13.9 %

Research and development 24,202 20,801 3,401 16.4 %

Selling, general and administrative 38,699 39,355 (656) (1.7) %

Impairment of other noncurrent assets 543 — 543 N/A

Total operating expenses 91,453 88,692 2,761 3.1 %

Operating loss (33,362) (28,430) (4,932) 17.3 %

Total other expense, net (8,654) (7,603) (1,051) 13.8 %

Equity in loss of affiliates (3) (602) 599 (99.5) %

Loss from continuing operations before income taxes (42,019) (36,635) (5,384) 14.7 %

Income tax benefit 112 80 32 40.0 %

Loss from continuing operations (41,907) (36,555) (5,352) 14.6 %

Income (loss) from discontinued operations, net of income taxes (2) 4,539 (62,797) 67,336 107.2 %

Net loss $ (37,368) $ (99,352) $ 61,984 (62.4) %

(1) Includes $0 and $230 from related parties for the six months ended June 30, 2021 and 2020, respectively.

(2) See "Notes to the Condensed Consolidated Financial Statements (Unaudited) - Note 3" appearing elsewhere in this Quarterly Report.

Collaboration and licensing revenues

Collaboration and licensing revenues decreased $14.7 million, or 98%, from the six months ended June 30, 2020 primarily due to the accelerated recognition of previously deferred revenue in the prior period upon the mutual termination of a collaboration with Castle Creek in February 2020.

Product revenues and gross margin

Product revenues increased $1.2 million, or 9%, over the six months ended June 30, 2020.

The increase in product revenue was primarily due to higher customer demand for animals as a result of stronger beef and dairy industries in the current year.

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Service revenues and gross margin

Service revenues increased $4.0 million, or 29%, over the three months ended March 31, 2020.

Service revenues increased $11.4 million, or 36%, over the six months ended June 30, 2020.

Additionally, Exemplar's service revenues increased in the current period due to an increase in services performed resulting from a higher demand from existing and new customers, which also improved gross margin on services performed.

Research and development expenses

Research and development expenses decreased $0.8 million, or 7%, from the three months ended March 31, 2020.

Salaries, benefits, and other personnel costs decreased $0.7 million in 2021 as we scaled down certain research and development functions in the first quarter of 2020 as a result of certain programs being previously deprioritized.

Research and development expenses increased $3.4 million, or 16%, over the six months ended June 30, 2020.

Contract research organization costs and lab supplies increased $3.8 million with the advancement of our clinical and preclinical programs.

Selling, general and administrative expenses

SG&A expenses decreased $2.8 million, or 13%, from the three months ended March 31, 2020.

SG&A expenses were comparable period over period due to offsetting changes.

Salaries, benefits, and other personnel costs decreased $1.6 million in 2021 primarily due to a reduced headcount as we scaled down our corporate functions to support our more streamlined organization and reduced stock compensation costs for previously granted awards that became fully vested in early 2021.

Professional fees decreased $1.0 million primarily due to a decrease in legal fees associated with certain litigation matters that were settled in the second half of 2020.

These decreases were partially offset by an increase in professional fees associated with certain current litigation matters.

Segment performance

The following table summarizes Segment Adjusted EBITDA, which is our primary measure of segment performance, for the three months ended March 31, 2021 and 2020, for each of our reportable segments as well as unallocated corporate costs.

Three Months Ended

March 31, Dollar

The following table summarizes Segment Adjusted EBITDA, which is our primary measure of segment performance, for the six months ended June 30, 2020 and 2020, for each of our reportable segments as well as unallocated corporate costs.

Six Months Ended

June 30, Dollar

Change Percent

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The following table summarizes revenues from external customers for the three months ended March 31, 2021 and 2020, for each of our reportable segments.

Three Months Ended

March 31, Dollar

The following table summarizes revenues from external customers for the six months ended June 30, 2021 and 2020, for each of our reportable segments.

Six Months Ended

June 30, Dollar

Change Percent

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Biopharmaceuticals

The decrease in Biopharmaceuticals revenue was due to the accelerated recognition of previously deferred revenue upon the mutual termination of a collaboration with Castle Creek in February 2020.

Segment Adjusted EBITDA improved as we deprioritized certain programs and scaled down certain research and development functions in the first quarter of 2020 but were partially offset by increases in costs associated with our clinical and preclinical programs.

The decrease in revenues for Biopharmaceuticals was primarily due to the accelerated recognition of previously deferred revenue in the prior period upon the mutual termination of a collaboration with Castle Creek in February 2020.

Segment Adjusted EBITDA declined as we had increased costs associated with the advancement of our clinical and preclinical programs.

Revenues for Exemplar increased due to an increase in services performed resulting from a higher demand from existing and new customers.

Revenues also increased due to price increases as well as a change in the pricing structure with certain customers.

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Unallocated Corporate Costs

Unallocated corporate costs decreased primarily due to a reduction of corporate employees as we scaled down our corporate functions to support our more streamlined organization, as well as a decrease in certain professional fees associated with certain litigation matters that were settled in the second half of 2020.

Unallocated corporate costs were comparable period over period due to offsetting changes.

Our unallocated corporate costs decreased from the prior period primarily due to a reduction of corporate employees as we scaled down our corporate functions to support our more streamlined organization.

These decreases were partially offset with increased professional fees associated with certain current litigation matters.

Liquidity and capital resources

Sources of liquidity

We have incurred losses from operations since our inception, and as of March 31, 2021, we had an accumulated deficit of $1.8 billion.

From our inception through March 31, 2021, we have funded our operations principally with proceeds received from private and public equity and debt offerings, cash received from our collaborators, and through product and service sales made directly to customers.

As of March 31, 2021, we had cash and cash equivalents of $27.4 million and short-term and long-term investments of $181.9 million.

We have incurred losses from operations since our inception, and as of June 30, 2021, we had an accumulated deficit of $1.9 billion.

From our inception through June 30, 2021, we have funded our operations principally with proceeds received from private and public equity and debt offerings, cash received from our collaborators, and through product and service sales made directly to customers.

As of June 30, 2021, we had cash and cash equivalents of $36.4 million and short-term and long-term investments of $164.0 million.

Cash in excess of immediate requirements is typically invested primarily in money market funds and U.S.

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We currently generate cash receipts primarily from sales of products and services and from strategic transactions.

As of March 31, 2021, Trans Ova was in compliance with the debt covenants associated with its line of credit as discussed in "Notes to the Condensed Consolidated Financial Statements (Unaudited) - Note 11" appearing elsewhere in this Quarterly Report.

As of June 30, 2021, Trans Ova was in compliance with the debt covenants associated with its line of credit as discussed in "Notes to the Condensed Consolidated Financial Statements (Unaudited) - Note 11" appearing elsewhere in this Quarterly Report.

The following table sets forth the significant sources and uses of cash for the periods set forth below:

Three Months Ended

Six Months Ended

(In thousands)

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Cash flows from operating activities:

During the three months ended March 31, 2021, our net loss was $17.3 million, which includes the following significant noncash expenses totaling $12.3 million from both continuing and discontinued operations:

(i) $5.4 million of stock-based compensation expense, (ii) $3.5 million of depreciation and amortization expense, (iii) $2.8 million accretion of debt discount and amortization of deferred financing costs, and (iv) $0.6 million of shares issued as payment for services.

These expenses

were partially offset by a $4.6 million noncash gain recognized upon the termination of our MBP Titan facility lease in January 2021.

During the three months ended March 31, 2020, our net loss was $56.0 million, which includes the following significant noncash expenses totaling $40.0 million from both continuing and discontinued operations:

(i) $27.0 million of accumulated foreign currency translation losses that were realized upon the closing of the Transactions, (ii) $4.8 million of depreciation and amortization expense, (iii) $4.4 million of stock-based compensation expense, (iv) $2.5 million accretion of debt discount and amortization of deferred financing costs, (v) $0.9 million of shares issued as payment for services, and (vi) $0.4 million of equity in net loss of affiliates.

During the six months ended June 30, 2021, our net loss was $37.4 million, which includes the following significant noncash expenses totaling $21.6 million from both continuing and discontinued operations:

(i) $9.0 million of stock-based compensation

expense, (ii) $7.0 million of depreciation and amortization expense, and (iii) $5.6 million accretion of debt discount and amortization of deferred financing costs.

These expenses were partially offset by a $4.6 million noncash gain recognized upon the termination of our MBP Titan facility lease in January 2021.

During the six months ended June 30, 2020, our net loss was $99.4 million, which includes the following significant noncash expenses totaling $73.0 million from both continuing and discontinued operations:

(i) $27.0 million of accumulated foreign currency translation losses that were realized upon the closing of the Transactions, (ii) $22.0 million of impairment losses related to goodwill and long-lived assets, (iii) $9.6 million of depreciation and amortization expense, (iv) $9.3 million of stock-based compensation expense, and (v) $5.1 million accretion of debt discount and amortization of deferred financing costs.

These expenses were partially offset by the recognition of $10.0 million of previously deferred revenue upon the mutual termination of a collaboration with Castle Creek in February 2020.

Our cash outflows from operations during the three months ended March 31, 2021 decreased $11.4 million from the three months ended March 31, 2020 primarily due to (i) increased cash flows provided by Trans Ova and Exemplar due to increased revenues and gross margins thereon, (ii) the reduction in cash requirements for MBP Titan as we suspended those operations in the second quarter of 2020, and (iii) reductions in operating expenses for our ActoBio and corporate operations as we streamlined both in order to further prioritize the use of our capital.

Our cash outflows from operations during the six months ended June 30, 2021 decreased $17.4 million from the six months ended June 30, 2020 primarily due to (i) increased cash inflows provided by Trans Ova and Exemplar due to increased revenues and gross margins thereon, (ii) the reduction in cash requirements for MBP Titan as we suspended those operations in the second quarter of 2020, and (iii) reductions in operating expenses for our corporate operations as we streamlined operations in order to further prioritize the use of our capital.

Cash flows from investing activities:

During the three months ended March 31, 2021, we purchased $133.7 million of investments, net of maturities and sales, primarily using the proceeds received from the underwritten public offering discussed below.

During the three months ended March 31, 2020, we purchased $101.3 million of investments, net of maturities, primarily using the $64.2 million of proceeds received from the Transactions, net of cash sold, and the private placement discussed below.

During the six months ended June 30, 2021, we purchased $116.2 million of investments, net of maturities and sales, primarily using the proceeds received from the underwritten public offering discussed below.

During the six months ended June 30, 2020, we purchased $76.3 million of investments, net of maturities, primarily using the $64.2 million of proceeds received from the Transactions, net of cash sold, and the private placement discussed below.

Cash flows from financing activities:

During the three months ended March 31, 2021, we received $121.0 million net proceeds from the sale of our common stock in an underwritten public offering.

During the three months ended March 31, 2020, we received $35.0 million proceeds from the sale of our common stock in a private placement to TS Biotechnology Holdings, LLC.

During the six months ended June 30, 2021, we received $121.0 million net proceeds from the sale of our common stock in an underwritten public offering.

During the six months ended June 30, 2020, we received $35.0 million proceeds from the sale of our common stock in a private placement to TS Biotechnology Holdings, LLC.

Future capital requirements

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Principal among these risks are dependence on key individuals and intellectual property, competition from other products and companies, and the technical risks associated with the successful research, development, and clinical manufacturing of its product candidates.

Our success is dependent upon our ability to continue to raise additional capital in order to fund ongoing research and development, obtain regulatory approval of our products, successfully commercialize our products, generate revenue, meet our obligations, and, ultimately, attain profitable operations.

Our success is dependent upon our ability to continue to raise additional capital in order to fund ongoing research and development, adequately satisfy or renegotiate long-term debt obligations, obtain regulatory approval of our products, successfully commercialize our products, generate revenue, meet our obligations, and, ultimately, attain profitable operations.

Our ability to achieve what is necessary for our success may be negatively impacted by the uncertainty caused by the COVID-19 pandemic.

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Contractual obligations and commitments

The following table summarizes our significant contractual obligations and commitments from continuing operations as of March 31, 2021 and the effects such obligations are expected to have on our liquidity and cash flows in future periods:

The following table summarizes our significant contractual obligations and commitments from continuing operations as of June 30, 2021 and the effects such obligations are expected to have on our liquidity and cash flows in future periods:

Total Less Than 1 Year 1 - 3 Years 3 - 5 Years More Than 5 Years

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(1) See "Notes to the Condensed Consolidated Financial Statements (Unaudited) - Notes 11" appearing elsewhere in this Quarterly Report for further discussion of our convertible debt.

In addition to the obligations in the table above, as of March 31, 2021 we also have the following significant contractual obligations described below.

In addition to the obligations in the table above, as of June 30, 2021 we also have the following significant contractual obligations described below.

In conjunction with the formation of our JVs, we committed to making future capital contributions subject to certain conditions and limitations.

As of March 31, 2021, our remaining capital contribution commitments to our JVs were $14.2 million.

As of June 30, 2021, our remaining capital contribution commitments to our JVs were $14.2 million.

These future capital contributions are not included in the table above due to the uncertainty of the timing and amounts of such contributions.

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These agreements are generally subject to termination by us and therefore no amounts are included in the tables above.

As of March 31, 2021, we also had research and development commitments with third parties totaling $15.2 million that had not yet been incurred.

As of June 30, 2021, we also had research and development commitments with third parties totaling $17.0 million that had not yet been incurred.

Net operating losses

As of March 31, 2021, we had net operating loss carryforwards of approximately $796.6 million for U.S.

As of June 30, 2021, we had net operating loss carryforwards of approximately $813.7 million for U.S.

federal income tax purposes available to offset future taxable income, including $561.0 million generated after 2017, U.S.

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As a result of our past issuances of stock, as well as due to prior mergers and acquisitions, certain of our net operating losses have been subject to limitations pursuant to Section 382.

As of March 31, 2021, Precigen has utilized all net operating losses subject to Section 382 limitations, other than those losses inherited via acquisitions.

As of March 31, 2021, approximately $42.1 million of domestic net operating losses were inherited via acquisitions and are limited based on the value of the target at the time of the transaction.

As of June 30, 2021, Precigen has utilized all net operating losses subject to Section 382 limitations, other than those losses inherited via acquisitions.

As of June 30, 2021, approximately $42.1 million of domestic net operating losses were inherited via acquisitions and are limited based on the value of the target at the time of the transaction.

Future changes in stock ownership may also trigger an ownership change and, consequently, a Section 382 limitation.

11 unchanged sentences

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