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Item 2. Management’s Discussion and Analysis

2025-05-14 compared with 2024-11-14 · 101 added, 210 removed, 157 unchanged (66% of the section changed)

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We are leveraging our proprietary technology platforms to develop product candidates designed to target urgent and intractable diseases in our core therapeutic areas of immuno-oncology, autoimmune disorders, and infectious diseases.

We have developed an extensive pipeline of therapies across multiple indications.

We believe that our array of technology platforms uniquely positions us among other biotechnology companies to advance precision medicine.

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Our therapeutic platforms, including UltraCAR-T, AdenoVerse immunotherapy, and ActoBiotics, are designed to allow us to precisely control the level and physiological location of gene expression and modify biological molecules to control the function and output of living cells to treat underlying disease conditions.

In addition, we have developed a proprietary electroporation device, UltraPorator, designed to further streamline and ensure the rapid and cost-effective manufacturing of UltraCAR-T therapies.

UltraPorator has received FDA clearance for manufacturing UltraCAR-T cells in clinical trials, and we have dosed patients manufactured UltraCAR-T cells using UltraPorator in our clinical trials.

We have developed a proprietary electroporation device, UltraPorator, designed to further streamline and ensure the rapid and cost-effective manufacturing of UltraCAR-T therapies.

UltraPorator has received FDA clearance for manufacturing UltraCAR-T cells in clinical trials, and we have been dosing patients with UltraCAR-T cells manufactured with UltraPorator in our clinical trials.

Our clinical pipeline includes PRGN-2012 and PRGN-2009, which are based on our AdenoVerse immunotherapy platform;

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We have completed enrollment in the Phase 1b clinical trial of PRGN-3006.

In addition, we have completed a Phase 1b/2a study of AG019, which is built on our ActoBiotics platform, which we have completed the shut-down of, as discussed below under our Biopharmaceuticals segment (Precigen ActoBio, Inc.).

As part of the strategic prioritization of our pipeline, we have paused enrollment in the PRGN-3005 and PRGN-3007 clinical trials.

In August 2024, we announced strategic prioritization of our pipeline to focus on development of our lead program, PRGN-2012.

We plan to minimize UltraCAR-T spend and focus on strategic partnerships to further advance UltraCAR-T programs.

We plan to minimize UltraCAR-T spending and focus on strategic partnerships to further advance UltraCAR-T programs.

As part of this restructuring, we have paused enrollment in PRGN-3005 and PRGN-3007 UltraCAR-T clinical trials.

In addition, we plan to continue PRGN-2009 Phase 2 clinical trials under a cooperative research and development agreement ("CRADA") with the National Cancer Institute ("NCI") in recurrent/metastatic cervical cancer and in newly diagnosed HPV-associated oropharyngeal cancer.

We do not plan to enroll patients in PRGN-2009 cervical cancer trial at non-NCI clinical sites.

We have reduced our focus on preclinical programs, while continuing select projects that we believe could provide further near-term validation of our technology platforms.

We have completed the shutdown of our ActoBio subsidiary operations, including the elimination of all ActoBio personnel.

In conjunction with this shutdown, ActoBio's portfolio of intellectual property is available for prospective transactions.

These strategic changes will enable us to focus on pre-commercialization efforts on PRGN-2012, including supporting submission of a rolling BLA under an accelerated approval pathway, conducting the confirmatory clinical trial, and manufacturing of commercial product.

These strategic changes are designed to enable us to focus on the pre-commercialization efforts on PRGN-2012, including supporting regulatory approval, conducting the confirmatory clinical trial, and manufacturing of commercial products.

Additionally, we will continue acceleration of commercial readiness efforts for a potential launch.

Our Biopharmaceuticals reportable segment is primarily comprised of the Company's legal entities of Precigen and ActoBio.

Our Exemplar reportable segment is comprised of Exemplar Genetics LLC, doing business as Precigen Exemplar, or Exemplar, our wholly owned subsidiary focused on developing research models and services for healthcare research applications.

Biopharmaceuticals

We have completed submission of a Biologics License Application ("BLA") for PRGN-2012 for the treatment of adults with Recurrent Respiratory Papillomatosis ("RRP") and the FDA has granted priority review with a Prescription Drug User Fee Act ("PDUFA") target action date set for August 27, 2025.

We are developing therapies built on our "off-the-shelf" AdenoVerse immunotherapy platform and our UltraCAR-T therapeutics platform.

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UltraPorator is intended to be a viable scale-up and commercialization solution for decentralized UltraCAR-T manufacturing.

PRGN-2012 is a first-in-class, investigational "off-the-shelf" AdenoVerse immunotherapy for the treatment of recurrent respiratory papillomatosis, or RRP.

PRGN-2012 is an innovative therapeutic vaccine with optimized antigen design that uses our gorilla adenovector technology, part of our proprietary AdenoVerse platform, to elicit immune responses directed against cells infected with HPV6 and HPV11.

We have completed the primary endpoint evaluation of the Phase 1/2 clinical trial.

PRGN-2012 Phase 1/2 pivotal trial data were presented at the 2024 American Society of Clinical Oncology (ASCO) Annual Meeting in June 2024.

We have announced that the FDA has agreed that the Phase 1/2 clinical trial of PRGN-2012 will serve as pivotal for the purpose of filing an accelerated approval request for licensure.

PRGN-2012 is an investigational "off-the-shelf" AdenoVerse gene therapy with optimized antigen design that uses our gorilla adenovector technology, part of our proprietary AdenoVerse platform, to elicit immune responses directed against cells infected with HPV6 and HPV11.

We have completed the Phase 1/2 pivotal clinical trial of PRGN-2012 in adults with RRP.

The Phase 1/2 pivotal study met the primary safety and efficacy endpoints.

The confirmatory clinical trial of PRGN-2012 is enrolling patients.

PRGN-2012 has been granted Breakthrough Therapy Designation and Orphan Drug designation for the treatment of RRP by the FDA.

PRGN-2012 has received Orphan Drug Designation for the Treatment of RRP from the European Commission as well.

We plan to submit a BLA under an accelerated approval pathway in the fourth quarter of 2024.

We are preparing for commercial readiness for a potential launch, if approved, of PRGN-2012 in 2025.

PRGN-2009 is a first-in-class, "off-the-shelf" investigational immunotherapy designed to activate the immune system to recognize and target human papillomavirus-positive, or HPV+, solid tumors.

PRGN-2009 leverages our UltraVector and AdenoVerse platforms to optimize HPV type 16 and HPV type 18, antigen designed for delivery via a proprietary gorilla adenovector with a large genetic payload capacity and the ability for repeat administrations.

We have completed a Phase 1 clinical trial of PRGN-2009 as a monotherapy or in combination with bintrafusp alfa, or M7824, an investigational bifunctional fusion protein, for patients with HPV-associated cancers in collaboration with the National Cancer Institute, or NCI, pursuant to a cooperative research and development arrangement, or CRADA.

A Phase 2 clinical trial of PRGN-2009 in combination with pembrolizumab in newly diagnosed oropharyngeal squamous cell carcinoma patients is ongoing in collaboration with the NCI pursuant to a CRADA.

We have completed the submission of, and received priority review for Precigen's BLA for PRGN-2012, which is intended for treating adults with RRP.

The PDUFA target action date is set for August 27, 2025.

PRGN-2009 is an "off-the-shelf" investigational gene therapy designed to activate the immune system to recognize and target human papillomavirus-positive, or HPV+, solid tumors.

PRGN-2009 leverages our UltraVector and AdenoVerse platforms to optimize HPV type 16 ("HPV 16") and HPV type 18 ("HPV 18"), antigen designed for delivery via a proprietary gorilla adenovector with a large genetic payload capacity and the ability for repeat administrations.

Guided by our bioinformatics analysis and in silico protein engineering, PRGN-2009 encodes for a novel, multi-epitope antigen design to target HPV16 and HPV18 infected cells and potentially differentiates from the competition.

PRGN-2009 is being evaluated in two Phase 2 clinical trials in combination with anti-PD1 monoclonal antibody, pembrolizumab, for patients with HPV-associated cancers in collaboration with NCI pursuant to a CRADA.

In addition, a Phase 2 randomized-controlled clinical trial of PRGN-2009 in combination with pembrolizumab to treat patients with recurrent or metastatic cervical cancer is ongoing pursuant to a CRADA.

As part of the strategic prioritization of our pipeline announced in August 2024, we plan to enroll patients in the PRGN-2009 clinical trials only at NCI under a CRADA.

PRGN-3006 is a first-in-class, investigational autologous CAR-T therapy that utilizes our UltraCAR-T platform to express a CAR to target CD33 (Siglec-3), mbIL15 and a kill switch gene.

PRGN-3006 is an investigational autologous CAR-T therapy that utilizes our UltraCAR-T platform to express a CAR to target CD33 (Siglec-3), mbIL15 and a kill switch gene.

PRGN-3006 is in a Phase 1/1b clinical trial for the treatment of relapsed or refractory, or r/r, acute myeloid leukemia, or AML, and high-risk myelodysplastic syndromes, or MDS.

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We have completed the Phase 1 dose escalation trial.

We have completed enrollment of the Phase 1b trial for PRGN-3006 in AML and are planning for an end of Phase 1b meeting with the FDA.

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.

PRGN-3005 is in a Phase 1/1b clinical trial for the treatment of advanced, recurrent platinum-resistant ovarian, fallopian tube,

or primary peritoneal cancer.

We have completed enrollment in the Phase 1 dose escalation cohorts of the intraperitoneal (IP) and intravenous (IV) arms without lymphodepletion as well as in the lymphodepletion cohort in the IV arm.

As part of the strategic prioritization of our pipeline announced in August 2024, we have paused enrollment in the Phase 1b clinical trial of PRGN-3005.

PRGN-3007 is a first-in-class, investigational autologous CAR-T therapy that utilizes the next generation UltraCAR-T platform to express a CAR which targets ROR1, mbIL15, a kill switch, and a novel mechanism for the intrinsic blockade of the programmed death 1, or PD-1, gene expression.

We have completed enrollment of the Phase 1b trial for PRGN-3006 in AML.

We plan to focus on strategic partnership opportunities to advance PRGN-3006 UltraCAR-T program in AML.

PRGN-3006 has been granted Orphan Drug designation in patients with AML and Fast Track Designation in patients with r/r AML by the FDA.

PRGN-3005 is an 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.

PRGN-3005 is in a Phase 1/1b clinical trial for the treatment of advanced, recurrent platinum-resistant ovarian, fallopian tube, or primary peritoneal cancer.

We have completed the Phase 1 dose escalation portion of the PRGN-3005 Phase 1/1b study.

As part of the strategic

prioritization of our pipeline announced in August 2024, we have paused enrollment in the Phase 1b clinical trial of PRGN-3005.

PRGN-3007 is an investigational autologous CAR-T therapy that utilizes the next generation UltraCAR-T platform to express a CAR which targets ROR1, mbIL15, a kill switch, and a novel mechanism for the intrinsic blockade of the programmed death 1, or PD-1, gene expression.

PRGN-3007 is in a Phase 1/1b clinical trial for patients with advanced receptor tyrosine kinase-like orphan receptor 1-positive, or ROR1 + , hematological (Arm 1) and solid tumors (Arm 2).

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Precigen ActoBio, Inc.

ActoBio utilizes a proprietary class of microbe-based biopharmaceuticals, referred to as ActoBiotics, that enable expression and local delivery of disease-modifying therapeutics.

Our ActoBiotics platform is a unique delivery platform precisely tailored for specific disease modification with the potential for superior efficacy and safety.

AG019, is a disease modifying antigen-specific, investigational immunotherapy for the prevention, delay, or reversal of type 1 diabetes mellitus, or T1D.

ActoBio has developed a proprietary class of microbe-based biopharmaceuticals that enable expression and local delivery of disease-modifying therapeutics.

We refer to these microbe-based biopharmaceuticals as ActoBiotics.

ActoBio’s lead asset is AG019, a disease modifying antigen-specific, investigational immunotherapy for the prevention, delay, or reversal of type 1 diabetes mellitus, or T1D.

We have completed a Phase 1b/2a clinical trial of AG019 for the treatment of early-onset T1D.

The Phase 1b portion of the study evaluated the safety and tolerability of AG019 monotherapy administered both as a single dose and as repeated daily doses in adult and adolescent patients.

The Phase 2a double-blind portion of the study investigated the safety and tolerability of AG019 in combination with teplizumab, or PRV-031.

The primary endpoint of assessing safety and tolerability in both the Phase 1b AG019 monotherapy and the Phase 2a AG019 combination therapy were met.

Into the second quarter of 2024, we operated ActoBio as a standalone subsidiary comprising our ActoBio reporting unit, which included our associated technologies, personnel, and facilities.

We previously announced our continued effort to strategically prioritize our application of resources to particular development efforts.

During the second quarter of 2024, we suspended ActoBio's operations and began the process to wind down ActoBio's activities.

This included the commencement of terminating leases and employees, and the disposition of certain of its assets and obligations with a focus on the preservation of ActoBio's intellectual property, which will be made available for prospective transactions.

We recorded non-cash impairment charges of $34.5 million during the second quarter of 2024 related to the write-down of goodwill, property and equipment, and right-of-use assets to their net realizable values.

In addition, we recorded a tax benefit of $1.7 million related to these impairment charges.

T he Company also recorded a charge related to employee severance and termination benefits of $2.1 million, which were paid in the third quarter of 2024.

We continue to assess potential next steps with respect to the future of the ActoBio programs and intellectual property.

See "Notes to the Condensed Consolidated Financial Statements (Unaudited) - Note 1, 6 and 7" appearing elsewhere in the Quarterly Report for further discussion, including discussion related to impairment and employee severance and termination charges of ActoBio.

As part of our strategic prioritization, we have completed the shutdown of our ActoBio subsidiary operations, including the elimination of all ActoBio personnel.

In conjunction with this shutdown, ActoBio's portfolio of intellectual property is available for prospective transactions.

Precigen Exemplar

Exemplar is committed to enabling the study of life-threatening human diseases through the development of Yucatan MiniSwine miniature preclinical research models and services.

Exemplar is committed to enabling the study of life-threatening human diseases through the development of MiniSwine Yucatan miniature pig research models and services.

Historically, researchers have lacked animal models that faithfully represent human diseases.

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novel diagnostics, procedures, devices, prevention strategies and therapeutics;

as well as the ability to predict in humans the efficacy of next-generation procedures, devices, and therapeutics.

and the ability to predict in humans the efficacy of those next-generation procedures, devices, and therapeutics.

Exemplar's MiniSwine models are genetically engineered to exhibit a wide variety of human disease states, which provides a more accurate platform to test the efficacy of new medications and devices.

As of September 30, 2024, our reportable segments were (i) Biopharmaceuticals and (ii) Exemplar.

These identified reportable segments met the quantitative thresholds to be reported separately for the nine months ended September 30, 2024.

Financial overview

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In addition, market changes and changes in judgements, assumptions, and estimates that we have made in assessing the fair value of goodwill could cause us to consider some portion or all of certain assets to become impaired.

See further discussion regarding our ability to continue as a going concern below under the future capital requirements section on Item 2.

See further discussion regarding our ability to continue as a going concern below under the Liquidity and capital resources section of Item 2.

Sources of revenue

Our primary current revenues arise from Exemplar, which generates product and service revenues through the development and sale of genetically engineered miniature swine models.

Currently, our primary revenues arise from Exemplar, which generates product and service revenues through the development and sale of genetically engineered miniature swine models.

We recognize revenue when control of the promised product or service is transferred to the customer.

As we have shifted our focus to our healthcare business, we have and may continue to mutually terminate historical collaboration agreements or repurchase rights to the exclusive fields from collaborators, relieving us of any further performance obligations under the agreement.

Upon such circumstances or when we determine no further performance obligations are required of us under an agreement, we may recognize any remaining deferred revenue as either collaboration revenue or as a reduction of operating expense, depending on the circumstances.

See "Notes to the Consolidated Financial Statements (Unaudited) - Note 3" appearing elsewhere in this Quarterly Report for a discussion of changes to our significant collaborations.

In future periods, in connection with our focus on healthcare, our revenues will primarily depend on our ability to advance and create our own programs and the extent to which we bring products enabled by our technologies to market.

Other than for collaboration revenues recognized upon cancellation or modification of an existing collaboration or for revenues generated pursuant to future strategic transactions for any of our existing platforms or programs, we expect our collaboration revenues will continue to decrease in the near term, although if any new collaboration agreements or strategic transactions are entered into, revenue could be positively impacted.

Our revenues will also depend upon our ability to maintain or improve the volume and pricing of Exemplar's current product and service offerings and to develop and scale up production of new offerings from the various technologies of Exemplar.

As we focus on our healthcare business, we anticipate that our expenses will increase substantially if, and as, we continue to advance the preclinical and clinical development of our existing product candidates and our research programs.

We expect a significant period of time could pass before commercialization of our various product candidates or before the achievement of contractual milestones and the realization of royalties on product candidates commercialized under our collaborations.

In future periods, our revenues will primarily depend on our ability to advance and create our own programs and the extent to which we bring products enabled by our technologies to market.

Other than for collaboration revenues recognized upon cancellation or modification of an existing collaboration or for revenues generated pursuant to future strategic transactions for any of our existing platforms or programs, we expect our collaboration revenues will continue to be minimal or zero in the near term, although if any new collaboration agreements or strategic transactions are entered into, revenue could be positively impacted.

Our revenues will also depend upon our ability to maintain or improve the volume and pricing of Exemplar's current product and service offerings.

We anticipate that our expenses will increase substantially if, and as, we continue to advance the preclinical and clinical development of our existing product candidates and our research programs.

We expect some period of time, and in most cases a significant period of time, could pass before commercialization of our various product candidates or before the achievement of contractual milestones and the realization of royalties on product candidates commercialized under our collaborations.

Accordingly, there can be no assurance as to the timing, magnitude, and predictability of revenues, if any, to which we might be entitled.

We do not expect any revenues that we may generate to be significant enough to fund our operations in the near term.

Cost of products and services

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• fees paid to consultants and contract research organizations who perform research on our behalf and under our direction;

• costs related to laboratory supplies used in our research and development efforts and acquiring, developing, and manufacturing preclinical study and clinical trial materials;

• costs related to laboratory supplies used in our research and development efforts and acquiring, developing, and manufacturing preclinical study and clinical trial materials as well as potential commercial products;

• costs related to certain in-licensed technology rights or in-process research and development;

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• facility-related expenses, which include direct depreciation costs and expenses for rent and maintenance of facilities and other operating costs.

Our research and development expenses are generally incurred by our reportable segments and primarily relate to either costs incurred to expand or otherwise improve our technologies or the costs incurred to develop our own products and services.

Prior to August 2024, our Biopharmaceuticals segment was progressing preclinical and clinical programs that targeted urgent and intractable diseases in our core therapeutic areas of immuno-oncology, autoimmune disorders, and infectious diseases, including PRGN-3005, PRGN-3006, PRGN-3007, PRGN-2009, AG019 and PRGN-2012.

Our research and development expenses primarily relate to either costs incurred to expand or otherwise improve our technologies or the costs incurred to develop our own products and services.

Prior to August 2024, the Company was progressing preclinical and clinical programs that targeted urgent and intractable diseases in our core therapeutic areas of immuno-oncology, autoimmune disorders, and infectious diseases, including PRGN-3005, PRGN-3006, PRGN-3007, PRGN-2009, PRGN-2012 and AG019.

As discussed above in the Overview, in August 2024, we announced a strategic prioritization of our clinical portfolio and streamlining of resources, to focus on potential commercialization of the PRGN-2012 AdenoVerse ® gene therapy for the treatment of RRP.

Our Exemplar segment's research and development activities relate to new and improved pig research models.

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 and nine months ended September 30, 2024 and 2023.

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Biopharmaceuticals

$ 11,347 $ 11,517 $ 41,240 $ 35,411

Exemplar 23 66 72 209

Total consolidated research and development expenses $ 11,370 $ 11,583 $ 41,312 $ 35,620

The Company's research and development activities also include the development of new and improved pig research models.

In addition to the strategic prioritization, the amount of research and development expenses may be impacted by, among other things, the number and nature of our own proprietary programs, the number and size of programs we may support on behalf of collaboration agreements, and the potential approval of the PRGN-2012 BLA by the FDA, as certain manufacturing costs will be recorded into inventory post approval.

Selling, general and administrative expenses

Selling, general and administrative, or SG&A, expenses consist primarily of salaries and related costs, including stock-based compensation expense and severance benefits, for employees in executive, operational (including commercialization), finance, information technology, legal, and corporate communications functions.

Other significant SG&A expenses include rent and utilities, insurance, accounting, and legal services (including the cost of settling any claims and lawsuits), and expenses associated with obtaining and maintaining our intellectual property.

Other significant SG&A expenses include rent and utilities, insurance, accounting, external commercialization costs, and legal services (including the cost of settling any claims and lawsuits), and expenses associated with obtaining and maintaining our intellectual property.

SG&A expenses may fluctuate in the future depending on the scaling of our corporate functions required to support our corporate initiatives, the strategic prioritization, the build-up of our commercialization efforts and the outcomes of legal claims and assessments against us.

Other income (expense), net

Other income consists of gain on convertible debt retirement (for 2023) and interest earned on our cash and cash equivalents and short-term and long-term investments, which may fluctuate based on amounts invested and current interest rates.

Other expense consisted primarily of interest on our Convertible Notes, which were fully retired in the second quarter of 2023, and the reclassification of cumulative foreign translation losses due to closing operations in ActoBio in the third quarter of 2024.

See "Notes to the Condensed Consolidated Financial Statements (Unaudited) - Note 8" and "Notes to the Condensed

Consolidated Financial Statements (Unaudited) - Note 10" appearing elsewhere in this Quarterly Report for further discussion on Convertible Notes and reclassification of cumulative foreign translation losses, respectively.

Segment performance

We use Segment Adjusted EBITDA as our primary measure of segment performance.

We define Segment Adjusted EBITDA as net income (loss) before (i) interest expense and interest income, (ii) income tax expense or benefit, (iii) depreciation and amortization, (iv) stock-based compensation expense, (v) loss on settlement agreements where noncash consideration is paid, (vi) adjustments for accrued bonuses paid in equity awards, (vii) gain or loss on disposals of assets, (viii) loss on impairment of goodwill and other noncurrent assets, (ix) equity in net income (loss) of affiliates, (x) reclassification of cumulative translation gain (loss), and (xi) recognition of previously deferred revenue associated with upfront and milestone payments as well as cash outflows from capital expenditures and investments in affiliates, but includes proceeds from the sale of assets in the period sold.

See "Notes to the Condensed Consolidated Financial Statements (Unaudited) - Note 14" appearing elsewhere in this Quarterly Report for further discussion of Segment Adjusted EBITDA.

Other income and expense net, consists of changes in the fair value of warrant liabilities and interest earned on our cash and cash equivalents and short-term and long-term investments, which may fluctuate based on amounts invested and current interest rates.

Results of operations

Comparison of the three months ended September 30, 2024 and the three months ended September 30, 2023

The following table summarizes our results of operations for the three months ended September 30, 2024 and 2023, together with the changes in those items in dollars and as a percentage:

Comparison of the three months ended March 31, 2025 and the three months ended March 31, 2024

The following table summarizes our results of operations for the three months ended March 31, 2025 and 2024, together with the changes in those items in dollars and as a percentage:

Three Months Ended

September 30, Dollar

March 31, Dollar

Change Percent

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— 29 (29) (100.0) %

$ (23,978) $ (19,795) $ (4,183) 21.1 %

Product and service revenues

Product and service revenues decreased $0.4 million, or 31%, compared to the three months ended September 30, 2023.

This decrease was related to reductions in product and service revenues at Exemplar.

Net loss $ (54,153) $ (23,738) $ (30,415) 128.1 %

Product, service and other revenues

Product, service and other revenues increased $0.3 million, or 26%, compared to the three months ended March 31, 2024.

This increase was primarily related to increased volume of products sold and services rendered at Exemplar.

Cost of product and services

Cost of product and services decreased primarily as a result of decreased revenues at Exemplar.

Cost of product and services slightly increased, primarily as a result of higher revenues at Exemplar.

Research and development expenses

Research and development expenses decreased by $0.2 million, or 2%, compared to the three months ended September 30, 2023.

The decrease was the result of a $2.0 million decrease in costs associated with ActoBio, including depreciation and amortization and personnel and operating costs, resulting from the shutdown of operations during the second quarter of 2024 as well as lower costs of $0.7 million incurred at contract research organizations for other programs compared to the same period in 2023.

These decreases were offset by increased costs of approximately $2.5 million including those associated with PRGN-2012 in advance of our planned BLA submission and our ongoing confirmatory trial, as well as increased personnel costs associated with severance incurred related to the Precigen workforce reduction in the third quarter of 2024.

Research and development expenses decreased by $3.8 million, or 27%, compared to the three months ended March 31, 2024.

The decrease was primarily due to a $1.8 million decrease in costs associated with ActoBio, including depreciation, amortization, personnel and other operating costs after the Company closed ActoBio operations in late 2024.

Additionally, there was a decrease of $1.2 million incurred at contract research organizations and an $0.8 million decrease due to a reduction in the number of Research and Development employees as a result of the Company's asset prioritization announced in the third quarter of 2024.

Selling, general and administrative expenses

SG&A expenses increased by $0.6 million, or 7%, compared to the three months ended September 30, 2023.

This increase was primarily due to severance costs incurred related to the Precigen workforce reduction, as well as increased costs associated with PRGN-2012 commercial readiness.

These increases were partially offset by a reduction in insurance rates and legal expenses compared to the prior year period.

Other income (expense), net

Other income (expense), net decreased by $3.8 million, or >(200)%, compared to the three months ended September 30, 2023.

This decrease was primarily due to the reclassification of cumulative translation losses of $2.9 million in the third quarter of 2024 as a result of the final closing of the ActoBio facilities, and a $0.6 million reduction in interest income.

Segment performance

The following table summarizes Segment Adjusted EBITDA, which is our primary measure of segment performance, for the three months ended September 30, 2024 and 2023, for each of our reportable segments.

Three Months Ended

September 30, Dollar

Change Percent

(In thousands)

Segment Adjusted EBITDA:

Biopharmaceuticals

$ (19,235) $ (16,437) $ (2,798) (17.0) %

Exemplar (159) (464) 305 65.7 %

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 14" appearing elsewhere in this Quarterly Report.

The following table summarizes revenues from external customers for the three months ended September 30, 2024 and 2023, for our one reportable segment for which revenue exists.

Three Months Ended

September 30, Dollar

Change Percent

(In thousands)

Exemplar $ 953 $ 1,379 $ (426) (30.9) %

Biopharmaceuticals

Segment Adjusted EBITDA loss increased compared to the prior period.

This was primarily due to costs incurred related to the Precigen workforce reduction and the previously announced departure of one of the Company's executive officers, as well as higher fees paid to contract research organizations related to PRGN-2012 confirmatory clinical trial and professional fees incurred in advance of our anticipated BLA submission, offset by lower costs incurred at contract research organizations for other programs compared to the prior period.

Capital expenditures were also higher in the current period due to the build-out of our manufacturing facility for PRGN-2012.

Revenues for Exemplar decreased due to a decrease in services performed resulting from a lower demand from existing customers.

The decline in Segment Adjusted EBITDA was primarily due to the decreased revenues.

Comparison of the nine months ended September 30, 2024 and the nine months ended September 30, 2023

The following table summarizes our results of operations for the nine months ended September 30, 2024 and 2023, together with the changes in those items in dollars and as a percentage:

Nine Months Ended

September 30, Dollar

Change Percent

(In thousands)

Product revenues $ 235 $ 730 $ (495) (67.8) %

Service revenues 2478 4,261 (1,783) (41.8) %

Other revenues 22 6 16 >200%

Total revenues 2,735 4,997 (2,262) (45.3) %

Operating expenses

Cost of product and services 3,098 4,761 (1,663) (34.9) %

Research and development 41,312 35,620 5,692 16.0 %

Selling, general and administrative 30,293 30,150 143 0.5 %

Impairment of goodwill 1,630 — 1,630 N/A

Impairment of other noncurrent assets 32,915 — 32,915 N/A

Total operating expenses 109,248 70,531 38,717 54.9 %

Operating loss (106,513) (65,534) (40,979) 62.5 %

SG&A expenses increased by $2.2 million, or 22%, compared to the three months ended March 31, 2024.

This increase was primarily associated with PRGN-2012 commercial readiness.

This increase was partially offset by a reduction in insurance rates and license and patent fees compared to the prior year period.

Total other income (expense), net

(1,701) 2,560 (4,261) (166.4) %

Loss before income taxes

(108,214) (62,974) (45,240) 71.8 %

Income tax benefit 1,706 126 1,580 >200%

$ (106,508) $ (62,848) $ (43,660) 69.5 %

Product and service revenues

Product and service revenues decreased $2.3 million, or 46%, compared to the nine months ended September 30, 2023.

This decrease was related to reductions in product and service revenues at Exemplar.

Cost of product and services

Cost of product and service decreased primarily as a result of decreased revenues at Exemplar and cost reduction initiatives implemented at Exemplar.

Research and development expenses

Research and development expenses increased $5.7 million, or 16%, compared to the nine months ended September 30, 2023.

The increase was primarily the result of $4.4 million of increased costs associated with PRGN-2012 in advance of our planned BLA submission, including the start of the PRGN-2012 confirmatory clinical trial and close out of the PRGN-2012 pivotal clinical trial activities and professional fees incurred related to our manufacturing facility.

Additionally, salaries, benefits, and other personnel costs increased by $3.0 million due to an increase in the hiring of employees related to the advancement of PRGN-2012 in the third and fourth quarters of 2023 and severance charges incurred related to the Precigen workforce reduction in the third quarter of 2024.

These increases were offset by lower costs of $1.6 million incurred at contract research organizations for other programs compared to the same period in 2023 as well as a $0.2 million reduction in total ActoBio operating expenses compared to the same period in 2023.

Selling, general and administrative expenses

SG&A expenses increased by $0.1 million, or 1%, compared to the nine months ended September 30, 2023.

This increase was primarily due to higher severance costs associated with the suspension of ActoBio's operations and the streamlining of Precigen's resources, as well as increased costs related to PRGN-2012 commercial readiness.

These increases were partially offset by a decrease in stock compensation and insurance expenses in 2024 compared to the same period in 2023.

Other income (expense), net

Other income, net decreased $4.3 million, or 166%, compared to the nine months ended September 30, 2023.

This decrease was primarily due to the reclassification of cumulative translation losses of $2.9 million resulting from the final closing of the ActoBio facilities in the third quarter of 2024, as well as a reduction of $1.1 million in interest income due to lower investment balances, and $0.5 million in interest expense due to the final retirement of our Convertible Notes in the second quarter of 2023.

Impairment of Goodwill and other noncurrent assets

In conjunction with the suspension of ActoBio’s operations, we recorded $34.5 million of impairment charges related to goodwill and long-lived assets in the second quarter of 2024.

Segment performance

The following table summarizes Segment Adjusted EBITDA, which is our primary measure of segment performance, for the nine months ended September 30, 2024 and 2023, for each of our reportable segments.

Nine Months Ended

September 30, Dollar

Change Percent

(In thousands)

Segment Adjusted EBITDA:

Biopharmaceuticals

$ (70,629) $ (55,034) $ (15,595) (28.3) %

Exemplar (842) (426) (416) N/A

The following table summarizes revenues from external customers for the nine months ended September 30, 2024 and 2023, for our one reportable segment for which revenue exists.

Nine Months Ended

September 30, Dollar

Change Percent

(In thousands)

Exemplar $ 2,735 $ 4,997 $ (2,262) (45.3) %

Biopharmaceuticals

Segment Adjusted EBITDA loss increased primarily due to higher fees paid to contract research organizations related to the start of the PRGN-2012 confirmatory clinical trial and close out of the PRGN-2012 pivotal clinical trial activities, together with professional fees incurred in advance of our anticipated BLA submission, offset by lower costs incurred at contract research organizations for other programs compared to the prior period.

Additionally, capital expenditures were higher related to the build-out of our manufacturing facility for PRGN-2012 in the nine months ended September 30, 2024, versus the nine months ended September 30, 2023.

Revenues for Exemplar decreased due to a decrease in services performed resulting from a lower demand from existing customers.

The decline in Segment Adjusted EBITDA was primarily due to the decreased revenues, offset by cost reduction initiatives implemented at Exemplar.

Total other income (expense), net changed from income of $0.6 million in the three months ended March 31, 2024 to expenses of $31.6 million in the three months ended March 31, 2025.

This change was primarily driven by the recording of a $32.5 million increase in the fair value of warrant liabilities, which was influenced by an increase in the stock price of Precigen and to a lesser extent, an increase in the liability to account for the additional warrants that will be issued as part of the paid-in-kind dividends related to the Company's Series A Preferred Stock.

This decrease was partially offset by a $0.3 million increase in interest income resulting from increased investments balances.

Liquidity and capital resources

Sources of liquidity

We have incurred losses from continuing operations since our inception, and as of September 30, 2024, we had an accumulated deficit of $2.1 billion.

From our inception through September 30, 2024, 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 September 30, 2024, we had cash and cash equivalents of $24.7 million and short-term investments of $3.9 million.

We have incurred losses from continuing operations since our inception, and as of March 31, 2025, we had an accumulated deficit of $2.1 billion.

From our inception through March 31, 2025, 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, 2025, we had cash and cash equivalents of $6.1 million and investments of $74.9 million.

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

government debt securities in order to maintain liquidity and preserve capital.

In January 2023, we closed a public offering of 43,962,640 shares of our common stock, resulting in net proceeds to us of $72.8 million, after deducting underwriting discounts, fees, and other offering expenses.

Additionally, in August 2024, we closed a public offering of 39,878,939 shares of our common stock, resulting in net proceeds to us of $30.9 million, after deducting underwriting discounts, fees, and an estimate of other offering expenses.

In August 2024, we closed a public offering of 39,878,939 shares of our common stock, resulting in net proceeds to us of $30.9 million, after deducting underwriting discounts, fees, and an estimate of other offering expenses.

In December 2024, we issued 79,000 shares of 8.00% Series A Convertible Perpetual Preferred Stock with an initial liquidation preference and stated value of $1,000 per share, together with warrants to purchase 52,666,669 shares of common stock for net proceeds of approximately $78,463, after deducting offering expenses, which expenses had not been paid as of March 31, 2025.

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

Nine Months Ended

September 30,

Three Months Ended

(In thousands)

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Effect of exchange rate changes on cash, cash equivalents, and restricted cash 2 (60)

Net increase (decrease) in cash, cash equivalents, and restricted cash

Net (decrease) increase in cash, cash equivalents, and restricted cash

$ (23,459) $ 9,895

Cash flows from operating activities:

During the nine months ended September 30, 2024, our net loss was $106.5 million, which includes the following significant noncash expenses and benefits totaling $46.1 million:

(i) $34.5 million of impairment losses, (ii) $6.6 million of stock-based compensation expense, (iii) $3.9 million of depreciation and amortization expense, (iv) $2.9 million due to reclassification of cumulative translation losses, and (v) $0.6 million of shares issued as payment for services, partially offset by non-cash benefits of $1.7 million due to deferred income taxes and $0.7 million due to amortization of discounts on investments.

During the three months ended March 31, 2025, our net loss was $54.2 million, which includes the following significant noncash expenses and benefits totaling $35.6 million:

(i) $32.5 million of unrealized appreciation in the fair value of warrant liabilities, (ii) $2.7 million of stock-based compensation expense, (iii) $0.6 million of depreciation and amortization expense, and (iv) $0.5 million of shares issued as payment for services, partially offset by non-cash benefits of $0.7 million due to amortization of discounts on investments.

In addition, changes in operating assets and liabilities provided $2.2 million of cash for operating activities.

During the nine months ended September 30, 2023, our net loss was $62.8 million, which includes the following significant noncash expenses and benefits totaling $11.8 million:

During the three months ended March 31, 2024, our net loss was $23.7 million, which includes the following significant noncash expenses and benefits totaling $4.3 million:

(i) $2.6 million of stock-based compensation expense, (ii) $1.6 million of depreciation and amortization expense and (iii) $0.5 million of shares issued as payment for services, offset by non-cash benefits of $0.4 million due to amortization of discounts on investments.

In addition, changes in operating assets and liabilities provided $0.1 million of cash for operating activities.

Cash flows from investing activities:

During the nine months ended September 30, 2024, we received $52.1 million of investments, from sales and maturities, net of purchases, and purchased $7.6 million of property, plant and equipment, primarily related to the build-out of our manufacturing facility.

During the nine months ended September 30, 2023, we purchased $16.0 million of investments, net of sales and maturities.

During the three months ended March 31, 2025, we received $5.8 million of investments, from sales and maturities, net of purchases, and purchased $0.6 million of property, plant and equipment, primarily related to the build-out of our manufacturing facility.

During the three months ended March 31, 2024, we received $28.4 million of investments, from sales and maturities, net of purchases, and purchased $4.4 million of property, plant and equipment.

Cash flows from financing activities:

During the nine months ended September 30, 2024, we received $31.8 million of proceeds, net of certain issuance costs, from the sale of our common stock in an underwritten public offering and $0.3 million of proceeds from stock option exercises.

During the nine months ended September 30, 2023, we received $72.8 million proceeds from the sale of our common stock in an underwritten public offering and retired $43.2 million of our Convertible Notes (including cost to retire).

During the three months ended March 31, 2025, we paid $0.4 million in issuance costs related to a prior year equity issuance, paid $0.5 million to taxing authorities related to vesting of performance stock units, and received $0.2 million from the exercise of stock options.

During the three months ended March 31, 2024, we did not have any cash inflows or outflows from financing activities.

Future capital requirements

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• progress in our research and development programs, as well as the magnitude and speed of development of these programs;

• capital expenditures to building out our manufacturing capabilities and preparing for commercial readiness;

• capital expenditures to building out our manufacturing capabilities;

• the speed and scale of building our commercial operations as we prepare for commercial readiness:

• the timing of regulatory approval of our product candidates and those of our collaborations;

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• the timing and capital requirements to scale up our various product candidates and service offerings and customer acceptance thereof;

• our ability to maintain and establish additional collaborative arrangements and/or new strategic initiatives;

• our ability to maintain and establish new collaborative arrangements and/or new strategic initiatives;

• the resources, time, and cost required for the preparation, filing, prosecution, maintenance, and enforcement of our intellectual property portfolio;

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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, 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 consolidated financial statements as of September 30, 2024 have been prepared on the basis that we will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.

Based on our balance of cash, cash equivalents and investments of $28.6 million at September 30, 2024 and forecasted negative cash flows from operating activities for the foreseeable future, there is substantial doubt about our ability to continue as a going concern within one year after the date that these financial statements are issued.

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 consolidated financial statements as of March 31, 2025 have been prepared on the basis that we will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.

Based on current projections, management believes that its existing cash, cash equivalents and short-term investments, combined with anticipated potential revenue from the commercialization of PRGN-2012, which is outside of our direct control, will enable us to continue our operations for at least one year from the date of this filing.

These assumptions include the receipt of future payments that are dependent upon the successful FDA approval of the PRGN-2012 BLA, and therefore revenue from this product is uncertain at this time.

Based on this factor, we do not know when, or if, we will generate sufficient revenue from commercialization to offset our operating expenses.

We are subject to all of the risks inherent in the development of new products, and we may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may adversely affect our business.

In addition, because our forecasted potential revenues are currently outside of our direct control, they have not been included in our going concern analysis.

These conditions raise substantial doubt about our ability to continue as a going concern for at least 12 months after the issuance of the accompanying condensed consolidated financial statements appearing elsewhere in this Quarterly Report.

Our financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Our ability to continue as a going concern is dependent upon the successful execution of management’s plans, which include the successful commercialization of PRGN-2012.

In addition, we may decide, or be required to raise additional capital.

additional capital could be raised through a combination of non-dilutive financings (including debt financings, collaborations, strategic alliances, monetization of non-core assets, marketing, distribution or licensing arrangements), dilutive financings (including equity and/or debt financings with an equity component) and, ultimately from revenue related to product sales, to the extent our product candidates receive marketing approval and can be commercialized.

There can be no assurance that new financings or other transactions will be available to us on commercially acceptable terms, or at all, and such financings may adversely affect the holdings or rights of our stockholders and may cause significant dilution to existing stockholders.

The condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty, which could have a material adverse effect on our financial condition.

See the section entitled "Risk Factors" in our Annual Report for additional risks associated with our substantial capital requirements.

Contractual obligations and commitments

The following table summarizes our significant contractual obligations and commitments from continuing operations as of September 30, 2024 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 March 31, 2025 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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Total $ 7,166 $ 1,518 $ 2,853 $ 2,572 $ 222

In addition to the obligations in the table above, as of September 30, 2024, we are party to license agreements with various third parties that contain future milestones and royalty payment obligations related to development milestones and/or commercial sales of products that incorporate or use their technologies.

In addition to the obligations in the table above, as of March 31, 2025, we are party to license agreements with various third parties that contain future milestones and royalty payment obligations related to development milestones and/or commercial sales of products that incorporate or use their technologies.

Because these agreements are generally subject to termination by us or are dependent on certain condition precedents within our control, no amounts are included in the tables above.

As of September 30, 2024, we also had research and development commitments with third parties totaling $7.4 million that had not yet been incurred.

As of March 31, 2025, we also had research and development commitments with third parties totaling $4.9 million that had not yet been incurred.

Off-balance sheet arrangements

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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