What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2025-08-12 compared with 2025-05-14 · 102 added, 53 removed, 205 unchanged (43% of the section changed)

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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.

UltraPorator has received Food and Drug Administration ("FDA") clearance for manufacturing UltraCAR-T cells in clinical trials, and we have dosed 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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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 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 August 2024, we announced the strategic prioritization of our pipeline to focus on development of our lead program, PRGN-2012.

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

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

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.

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

Additionally, we have continued commercial readiness efforts for a potential launch.

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.

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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.

Through our UltraCAR-T therapeutics platform, we are able to precision-engineer UltraCAR-T cells to produce a homogeneous cell product that simultaneously expresses antigen-specific chimeric antigen receptor, or CAR, kill switch, and our proprietary membrane-bound interleukin-15, or mbIL15, genes in any genetically modified UltraCAR-T cell.

Our decentralized and rapid proprietary manufacturing process allows us to manufacture UltraCAR-T cells overnight at a medical center's current good manufacturing practices facility, or cGMP, and reinfuse the patient the following day after gene transfer.

This process improves upon current approaches to CAR-T manufacturing, which require extensive ex vivo expansion following viral vector transduction to achieve clinically relevant cell numbers that we believe can result in the exhaustion of CAR-T cells prior to their administration, limiting their potential for persistence in patients.

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

The UltraPorator system includes proprietary hardware and software solutions and potentially represents major advancements over current electroporation devices by significantly reducing the processing time and contamination risk.

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

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.

PRGN-2012 is an investigational AdenoVerse immunotherapy 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.

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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 is an investigational AdenoVerse immuno-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.

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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.

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

The UltraPorator system includes proprietary hardware and software solutions and potentially represents a major advancement s over current electroporation devices by significantly reducing the processing time and contamination risk.

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

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.

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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.

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The target patient population for Arm 2 includes locally advanced unresectable or metastatic histologically confirmed TNBC.

The study is designed to enroll in two parts:

The trial is designed to enroll in two parts:

an initial 3+3 dose escalation in each arm followed by a dose expansion at the maximum tolerated dose.

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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.

As we continue our efforts to focus our business and generate additional capital, we may be willing to enter into transactions involving one or more of our operating segments and reporting units for which we have goodwill and intangible assets.

As we continue our efforts to focus our business and generate additional capital, we may be willing to enter into transactions involving our operating segment or one or more of our reporting units for which we have goodwill and intangible assets.

These efforts could result in us identifying impairment indicators or recording impairment charges in future periods.

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

• other manufacturing costs related to the manufacture of drug products that have not yet been approved by the FDA.

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.

AdenoVerse ® gene therapy for the treatment of RRP.

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

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Results of operations

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:

Comparison of the three months ended June 30, 2025 and the three months ended June 30, 2024

The following table summarizes our results of operations for the three months ended June 30, 2025 and 2024 (dollars in thousands):

Three Months Ended

March 31, Dollar

June 30, Dollar

Change Percent

(In thousands)

Product revenues $ 41 $ 31 $ 10 32.3 %

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Selling, general and administrative 16,133 10,306 5,827 56.5 %

Impairment of goodwill 3,907 1,630 2,277 139.7 %

Impairment of other noncurrent assets — 32,915 (32,915) (100.0) %

Total operating expenses 32,620 61,558 (28,938) (47.0) %

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(26,639) (60,481) 33,842 (56.0) %

Income tax benefit (expense)

Income tax (expense) benefit

(3) 1,689 (1,692) (100.2) %

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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.

Product, service and other revenues increased $0.1 million, or 19%, compared to the three months ended June 30, 2024.

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

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Research and development expenses

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.

Research and development expenses decreased by $4.2 million, or 27%, compared to the three months ended June 30, 2024.

The decrease was primarily due to a $3.8 million decrease in costs associated with ActoBio, including depreciation, amortization, personnel and other research and development costs after the Company closed ActoBio operations in late 2024.

Additionally, there was a decrease of $0.5 million incurred at contract research organizations 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 $2.2 million, or 22%, compared to the three months ended March 31, 2024.

SG&A expenses increased by $5.8 million, or 57%, compared to the three months ended June 30, 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.

This increase was partially offset by a reduction in costs associated with ActoBio, legal fees, insurance rates and license and patent fees compared to the prior year period.

Impairment of Goodwill and other noncurrent assets

In the second quarter of 2025, we recorded $3.9 million in impairment related to our Exemplar reporting unit.

Additionally, 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.

Total other income (expense), net

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.

Total other income (expense) increased $4.8 million, compared to the three months ended June 30, 2024.

This change was primarily driven by $4.5 million decrease in the fair value of warrant liabilities, which was influenced by a decrease in the stock price of Precigen common stock compared to the first quarter of 2025 and to a lesser extent, a decrease 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,which was also influenced by a decrease in the stock price of Precigen common stock compared to the first quarter of 2025.

Additionally, interest income rose by $0.4 million resulting from increased investment balances.

Comparison of the six months ended June 30, 2025 and the six months ended June 30, 2024

The following table summarizes our results of operations for the six months ended June 30, 2025 and 2024 (dollars in thousands):

Six months ended

June 30, Dollar

Change Percent

Product revenues $ 244 $ 169 $ 75 44.4 %

Service revenues 1,896 1,592 304 19.1 %

Other revenues 57 21 36 171.4 %

Total revenues 2,197 1,782 415 23.3 %

Operating expenses

Cost of product and services 2,192 2,089 103 4.9 %

Research and development 21,966 29,942 (7,976) (26.6) %

Selling, general and administrative 28,492 20,457 8,035 39.3 %

Impairment of goodwill 3,907 1,630 2,277 139.7 %

Impairment of other noncurrent assets — 32,915 (32,915) (100.0) %

Total operating expenses 56,557 87,033 (30,476) (35.0) %

Operating loss (54,360) (85,251) 30,891 (36.2) %

Total other income (expense), net

(26,432) 1,003 (27,435) >(200)%

Loss before income taxes

(80,792) (84,248) 3,456 (4.1) %

Income tax (expense) benefit

(3) 1,718 (1,721) (100.2) %

$ (80,795) $ (82,530) $ 1,735 (2.1) %

Product and service revenues

Product and service revenues increased by $0.4 million, or 22%, compared to the six months ended June 30, 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 service increased primarily as a result of higher revenues at Exemplar.

Research and development expenses

Research and development expenses decreased by $8.0 million, or (27)%, compared to the six months ended June 30, 2024.

The decrease was primarily due to a $5.6 million decrease in costs associated with ActoBio, including depreciation, amortization, personnel and other research and development costs after the Company closed ActoBio operations in late 2024.

Additionally, there was a decrease of $1.5 million at contract research organizations and a $1 million reduction in personnel expenses due to the Company's asset prioritization announced in the third quarter of 2024.

Selling, general and administrative expenses

SG&A expenses increased by $8.0 million, or 39%, compared to the six months ended June 30, 2024.

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

This increase was partially offset by a reduction in costs associated with ActoBio, legal fees, insurance rates and license and patent fees compared to the prior year period.

Impairment of Goodwill and other noncurrent assets

In the second quarter of 2025, we recorded $3.9 million in impairment related to our Exemplar reporting unit.

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.

Total other income (expense), net

Total other income (expense), net changed from income of $1.0 million in the six months ended June 30, 2024 to expense of $26.4 million in the six months ended June 30, 2025.

This change was primarily driven by the recording of a $28.0 million increase in the fair value of warrant liabilities, which was influenced by an increase in the stock price of Precigen common stock compared to the end of 2024 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, which was also influenced by an increase in the stock price of Precigen common stock since December 31, 2024.

Liquidity and capital resources

Sources of liquidity

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.

We have incurred losses from continuing operations since our inception, and as of June 30, 2025, we had an accumulated deficit of $2.2 billion.

From our inception through June 30, 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 June 30, 2025, we had cash and cash equivalents of $13.8 million and investments of $46.0 million.

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

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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:

Three Months Ended

Six Months Ended

(In thousands)

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Cash flows from operating activities:

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.

During the six months ended June 30, 2025, our net loss was $80.8 million, which includes the following significant noncash expenses and benefits totaling $36.8 million:

(i) $28.0 million of unrealized appreciation in the fair value of warrant liabilities, (ii) $3.9 million impairment of goodwill, (iii) $4.3 million of stock-based compensation expense, (iv) $1.3 million of depreciation and amortization expense, and (v) $0.5 million of shares issued as payment for services, partially offset by non-cash benefits of $1.2 million due to amortization of discounts on investments.

In addition, changes in operating assets and liabilities provided $8.6 million of cash for operating activities.

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.

During the six months ended June 30, 2024, our net loss was $82.5 million, which includes the following significant noncash expenses and benefits totaling $40.4 million:

(i) $34.5 million of impairment losses, (ii) $4.5 million of stock-based compensation expense, (iii) $3.2 million of depreciation and amortization expense, and (iv) $0.5 million of shares issued as payment for services, offset by non-cash benefits of $1.7 million due to deferred income taxes and $0.6 million due to amortization of discounts on investments.

In addition, changes in operating assets and liabilities provided $4.8 million of cash for operating activities.

Cash flows from investing activities:

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.

During the six months ended June 30, 2025, we received $23.6 million of investments, from sales and maturities, net of purchases, and purchased $1.6 million of property, plant and equipment, primarily related to the build-out of our manufacturing facility.

During the six months ended June 30, 2024, we received $45.7 million of investments, from sales and maturities, net of purchases, and purchased $6.7 million of property, plant and equipment, primarily related to the build-out of our manufacturing facility.

Cash flows from financing activities:

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.

During the six months ended June 30, 2025, we paid $0.4 million in issuance costs related to a prior year equity issuance, $0.5 million related to the prior year preferred stock issuance costs, and $1.8 million to taxing authorities related to vesting of equity awards, and received $0.2 million from the exercise of stock options.

During the six months ended June 30, 2024, we received $0.1 million of proceeds from stock option exercises.

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;

• capital expenditures to building out our manufacturing capabilities, including the potential manufacturing of other product candidates;

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

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To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interests of our common shareholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our common shareholders.

Our current stock price may make it more difficult to pursue equity financings and lead to substantial dilution if the price of our common stock does not increase.

Our current stock price may make it more

difficult to pursue equity financings and lead to substantial dilution if the price of our common stock does not increase.

Debt financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, or declaring dividends.

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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.

Our consolidated financial statements as of June 30, 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.

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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.

This 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.

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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, 2025 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, 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 $ 6,749 $ 1,494 $ 2,775 $ 2,479 $ —

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.

In addition to the obligations in the table above, as of June 30, 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 March 31, 2025, we also had research and development commitments with third parties totaling $4.9 million that had not yet been incurred.

As of June 30, 2025, we also had research and development commitments with third parties totaling $4.6 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