Prime Medicine, Inc. 10-Q

Item 1. Financial Statements (unaudited) PRIME MEDICINE, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (in thousands, except share and per share amounts) June 30, 2025 December 31, 2024 Assets Current assets: Cash and cash equivalents $ 53,804 $ 182,476 Short-term investments 44,539 2,998 Short-term investment — related party 3,407 4,968 Collaboration receivable — related party 120 — Prepaid expenses 3,032 6,777 Other current assets 16,385 14,667 Total current assets 121,287 211,886 Property and equipment, net 23,828 24,404 Operating lease right-of-use assets 120,203 47,156 Restricted cash 13,691 14,062 Total assets $ 279,009 $ 297,508 Liabilities and Stockholders’ Equity Current liabilities: Accounts payable $ 6,378 $ 11,351 Accrued expenses and other current liabilities 12,158 15,904 Deferred revenue — related party 8,315 7,092 Operating lease liability 7,258 3,614 Total current liabilities 34,109 37,961 Deferred revenue, net of current — related party 59,562 63,218 Operating lease liability, net of current 112,478 37,180 Research and development funding liability 12,000 6,000 Total liabilities 218,149 144,359 Commitments and contingencies Stockholders’ equity Common stock, par value of $ 0.00001 per share; 775,000,000 shares authorized; 134,494,438 and 131,160,842 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively 2 2 Additional paid-in capital 852,561 840,358 Accumulated other comprehensive loss ( 10 ) 1 Accumulated deficit ( 791,693 ) ( 687,212 ) Total stockholders’ equity 60,860 153,149 Total liabilities and stockholders’ equity $ 279,009 $ 297,508 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 5 PRIME MEDICINE, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) Three Months Ended June 30, Six Months Ended June 30, (in thousands, except share and per share amounts) 2025 2024 2025 2024 Revenue: Collaboration revenue — related party $ 1,115 $ — $ 2,569 $ — Collaboration revenue — — — 591 Total revenue 1,115 — 2,569 591 Operating expenses: Research and development 41,375 43,071 81,937 80,845 General and administrative 13,117 12,601 26,401 23,759 Total operating expenses 54,492 55,672 108,338 104,604 Loss from operations ( 53,377 ) ( 55,672 ) ( 105,769 ) ( 104,013 ) Other income: Interest income 743 611 1,925 1,287 Accretion (amortization) of investments 530 1,486 869 2,316 Change in fair value of short-term investment — related party ( 505 ) ( 1,925 ) ( 1,561 ) ( 759 ) Other income, net 18 39 55 81 Total other income, net 786 211 1,288 2,925 Net loss before income taxes ( 52,591 ) ( 55,461 ) ( 104,481 ) ( 101,088 ) Provision for income taxes — 134 — — Net loss attributable to common stockholders $ ( 52,591 ) $ ( 55,327 ) $ ( 104,481 ) $ ( 101,088 ) Net loss per share attributable to common stockholders, basic and diluted $ ( 0.41 ) $ ( 0.46 ) $ ( 0.81 ) $ ( 0.90 ) Weighted-average common shares outstanding, basic and diluted 129,185,918 119,188,866 128,439,349 111,827,522 Comprehensive loss: Net loss $ ( 52,591 ) $ ( 55,327 ) $ ( 104,481 ) $ ( 101,088 ) Change in unrealized loss on investments, net of tax 5 24 ( 11 ) ( 56 ) Comprehensive loss $ ( 52,586 ) $ ( 55,303 ) $ ( 104,492 ) $ ( 101,144 ) The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 6 PRIME MEDICINE, INC. CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited) Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Losses Accumulated Deficit Total Stockholders’ Equity (in thousands, except share amounts) Shares Amount Balance as of December 31, 2024 131,160,842 $ 2 $ 840,358 $ 1 $ ( 687,212 ) $ 153,149 Stock-based compensation expense — — 5,681 — — 5,681 Change in unrealized loss on investments, net of tax — — — ( 16 ) — ( 16 ) Net loss — — — — ( 51,890 ) ( 51,890 ) Balance as of March 31, 2025 131,160,842 $ 2 $ 846,039 $ ( 15 ) $ ( 739,102 ) $ 106,924 Exercise of pre-funded warrants 3,199,984 — — — — — Issuance of common stock under the employee stock purchase plan 133,612 — 197 — — 197 Stock-based compensation expense — — 6,325 — — 6,325 Change in unrealized loss on investments, net of tax — — — 5 — 5 Net loss — — — — ( 52,591 ) ( 52,591 ) Balance as of June 30, 2025 134,494,438 $ 2 $ 852,561 $ ( 10 ) $ ( 791,693 ) $ 60,860 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 7 PRIME MEDICINE, INC. CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited) Common Stock Additional Paid-in Capital Accumulated Other Comprehensive Losses Accumulated Deficit Total Stockholders’ Equity (in thousands, except share amounts) Shares Amount Balance as of December 31, 2023 97,377,121 $ 2 $ 624,414 $ ( 15 ) $ ( 491,330 ) $ 133,071 Issuance of common stock from public offering, net of issuance costs of $ 8.9 million 22,560,001 — 132,055 — — 132,055 Issuance of pre-funded warrants, net of issuance costs of $ 1.2 million — — 18,800 — — 18,800 Issuance of common stock under the employee stock purchase plan 74,488 — 436 — — 436 Issuance of common stock upon exercise of stock options 9,664 — 36 — — 36 Stock-based compensation expense — — 5,209 — — 5,209 Change in unrealized loss on investments, net of tax — — — ( 80 ) — ( 80 ) Net loss — — — — ( 45,761 ) ( 45,761 ) Balance as of March 31, 2024 120,021,274 2 780,950 ( 95 ) ( 537,091 ) 243,766 Issuance of common stock upon exercise of stock options 9,539 — 35 — — 35 Stock-based compensation expense — — 8,091 — — 8,091 Change in unrealized loss on investments, net of tax — — — 24 — 24 Net loss — — — — ( 55,327 ) ( 55,327 ) Balance as of June 30, 2024 120,030,813 $ 2 $ 789,076 $ ( 71 ) $ ( 592,418 ) $ 196,589 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 8 PRIME MEDICINE, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Six Months Ended June 30, (in thousands) 2025 2024 Cash flows used in operating activities: Net loss $ ( 104,481 ) $ ( 101,088 ) Adjustments to reconcile net loss to net cash used in operating activities Stock-based compensation expense 12,006 13,300 Non cash lease expense 4,761 7,917 Depreciation expense 3,564 2,853 Change in fair value of short-term investment — related party 1,561 759 Amortization of premiums and discount on short-term investments ( 575 ) ( 2,079 ) Deferred income taxes — — Changes in operating assets and liabilities: Collaboration receivable — related party ( 120 ) — Prepaid expenses and other current assets 652 ( 2,519 ) Accounts payable ( 1,461 ) ( 9,230 ) Accrued expenses and other current liabilities ( 1,690 ) ( 3,939 ) Accrued settlement payment — related party — ( 13,500 ) Deferred revenue — related party ( 2,433 ) — Lease liabilities ( 2,053 ) ( 5,672 ) Net cash used in operating activities ( 90,269 ) ( 113,198 ) Cash flows used in investing activities: Maturities of investments 14,250 110,000 Purchases of investments ( 55,227 ) ( 135,912 ) Purchases of property and equipment ( 3,994 ) ( 4,226 ) Net cash used in investing activities ( 44,971 ) ( 30,138 ) Cash flows provided by financing activities: Proceeds from research and development funding liability 6,000 6,000 Proceeds from follow-on offering, net of issuance costs — 132,055 Proceeds from issuance of pre-funded warrants, net of issuance costs — 18,800 Proceeds from ESPP offerings 197 436 Net proceeds from stock option exercises — 71 Net cash provided by financing activities 6,197 157,362 Net change in cash, cash equivalents, and restricted cash ( 129,043 ) 14,026 Cash, cash equivalents, and restricted cash at beginning of period 196,538 55,070 Cash, cash equivalents, and restricted cash at end of period $ 67,495 $ 69,096 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 9 PRIME MEDICINE, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Six Months Ended June 30, (in thousands) 2025 2024 Reconciliation of cash, cash equivalents and restricted cash: Cash, cash equivalents, and restricted cash at end of period $ 67,495 $ 69,096 Less: restricted cash 13,691 13,496 Total cash, and cash equivalents $ 53,804 $ 55,600 Supplemental cash flow information: Right-of-use assets obtained in exchange for new operating lease liabilities $ 83,757 $ 44,935 Decrease in right-of-use assets due to lease termination $ 3,120 $ — Supplemental disclosure of non-cash investing and financing activities: Purchases of property and equipment included in accounts payable and accrued expenses $ 148 $ 355 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 10 PRIME MEDICINE, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. Nature of the Business and Basis of Presentation Prime Medicine, Inc., together with its consolidated subsidiary (the “Company”) is a biotechnology company committed to delivering a new class of differentiated one-time curative genetic therapies. The Company is deploying Prime Editing technology, which it believes is a versatile, precise, and efficient gene editing technology. The Company was incorporated in the State of Delaware in September 2019. Its principal offices are in Cambridge, Massachusetts. Liquidity and Capital Resources Since its inception, the Company has devoted substantially all of its resources to building its Prime editing platform and advancing development of its portfolio of programs, establishing and protecting its intellectual property, conducting research and development activities, organizing and staffing the company, business planning, raising capital and providing general and administrative support for these operations. To date, the Company has funded its operations primarily with proceeds from sales of preferred stock, from public offerings, and private placement of its common stock, and through payments from its collaboration partners. In August 2025, the Company issued and sold 43,700,000 shares of its common stock, including 5,700,000 shares pursuant to the exercise of the underwriters’ option to purchase additional shares, at a price to the public of $ 3.30 per share. As a result of the offering, the Company received approximately $ 138.2 million in net proceeds, after deducting underwriting discounts, commissions and estimated offering costs of $ 6.0 million. Since its inception, the Company has incurred substantial losses and, as of June 30, 2025, the Company had an accumulated deficit of $ 791.7 million. The Company expects to generate operating losses and negative operating cash flows for the foreseeable future. The Company further expects that its cash, cash equivalents, and investments as of June 30, 2025 of $ 101.8 million, along with the $ 138.2 million in net proceeds received from the sale of common stock in August 2025 discussed above, will be sufficient to fund its operations for at least the next twelve months from the date of issuance of these financial statements. Risks and Uncertainties The Company is subject to risks and uncertainties common to early stage companies in the biotechnology industry, including, but not limited to, completing preclinical studies and clinical trials, obtaining regulatory approval for product candidates, market acceptance of products, development by competitors of new technological innovations, dependence on key personnel, the ability to attract and retain qualified employees, reliance on third-party organizations, protection of proprietary technology, compliance with government regulations, and the ability to raise additional capital to fund operations. The Company’s product candidates currently under development will require significant additional research and development efforts, including extensive preclinical and clinical testing and regulatory approval prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel and infrastructure, and extensive compliance-reporting capabilities. Even if the Company’s development efforts are successful, it is uncertain when, if ever, the Company will realize significant revenue from product sales. The Company will need to raise additional capital to support its continuing operations and to pursue its growth strategy. Until such time as the Company can generate significant revenue from product sales, if ever, it expects to finance its operations through a combination of private and public equity offerings, debt financings, collaborations, strategic alliances, licensing, or other arrangements with third parties, or other similar transactions. The Company may be unable to raise additional capital or enter into such other agreements when needed on favorable terms or at all. The inability to raise capital as and when needed would have a negative impact on the Company’s financial 11 condition and its ability to pursue its business strategy. The Company will need to generate significant revenue to achieve profitability, and it may never do so. Basis of Presentation The accompanying condensed consolidated financial statements reflect the operations of the Company and its wholly-owned subsidiary. Intercompany balances and transactions have been eliminated in consolidation. The accompanying condensed consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the ASC and Accounting Standards Updates (“ASU”) of the Financial Accounting Standards Board (“FASB”). The accompanying condensed consolidated financial statements of Prime Medicine, Inc. are unaudited. The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of June 30, 2025, the results of its operations for the three and six months ended June 30, 2025 and 2024, the condensed consolidated statements of stockholders’ equity for the three and six months ended June 30, 2025 and 2024, and its cash flows for the six months ended June 30, 2025 and 2024. The financial data and other information disclosed in these notes related to the three and six months ended June 30, 2025 and 2024 are also unaudited. The results for the three and six months ended June 30, 2025 are not necessarily indicative of results to be expected for the year ending December 31, 2025, any other interim periods, or any future year or period. The condensed consolidated balance sheet data as of December 31, 2024 was derived from our audited financial statements, but does not include all disclosures required by U.S. GAAP. These interim financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2024, and notes thereto, which are included in the Company’s Annual Report on Form 10-K that was filed with the Securities and Exchange Commission (the “SEC”) on February 28, 2025. 2. Summary of Significant Accounting Policies The Company’s significant accounting policies are disclosed in Note 2, Summary of significant accounting policies , in the audited consolidated financial statements for the year ended December 31, 2024, and notes thereto, included in the Company’s Annual Report on Form 10-K that was filed with the SEC on February 28, 2025. Since the date of those financial statements, there have been no material changes to its significant accounting policies, except as noted below. Use of Estimates The preparation of the Company’s condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant estimates and assumptions reflected within these condensed consolidated financial statements include, but are not limited to, the valuation of the Company’s common stock and stock-based awards. The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates, as there are changes in circumstances, facts and experience. Actual results may differ materially from those estimates or assumptions. Segment Information Under ASC 280, Segment Reporting, operating segment is a component of a public entity that 1) engages in business activities from which it may recognize revenues and incur expenses, 2) its operating results are regularly reviewed by the entity’s chief operating decision maker (“CODM”) to make decisions about resource allocation or performance assessment, and 3) its discrete financial information is available. The Company operates and manages its business as a single segment for the purposes of assessing performance and making operating decisions. 12 Our chief executive officer, who is the CODM, manages and allocates resources to the operations of our company on a total company basis by assessing the overall level of resources available and how to best deploy these resources across functions and research and development projects that are in line with our long-term company-wide strategic goals. In making these decisions, the CODM uses consolidated financial information for purposes of evaluating performance, forecasting future period financial results, allocating resources and setting incentive targets. The CODM performs this assessment based on the Company’s consolidated net loss. Through this analysis, the CODM assesses performance by comparing actual net loss verses the budget, and then decides how to allocate resources to invest in the Company’s research and development programs. The measure of segment assets is reported on the consolidated balance sheets as total assets. The following table contains additional information on our consolidated net loss, including significant segment expenses: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2025 2024 2025 2024 Total revenue $ 1,115 $ — $ 2,569 $ 591 Operating expenses: Research and development expenses Personnel expenses 14,448 16,198 29,248 31,205 Facility related 13,765 11,302 24,734 18,636 Research costs 8,116 11,390 19,152 23,009 General and administrative expenses: Personnel expenses 7,082 6,956 14,238 12,840 Other segment items (1) 11,081 9,826 20,966 18,914 Total operating expenses 54,492 55,672 108,338 104,604 Total other income, net 786 211 1,288 2,925 Provision for income taxes — 134 — — Net loss $ ( 52,591 ) $ ( 55,327 ) $ ( 104,481 ) $ ( 101,088 ) (1) Other segment items consist of professional and consultant fees, license and intellectual property fees, general and administrative facility costs, and settlement costs. Recently Issued Accounting Pronouncements Not Yet Adopted In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , which requires enhanced income tax disclosures, including specific categories and disaggregation of information in the effective tax rate reconciliation, disaggregated information related to income taxes paid, income or loss from continuing operations before income tax expense or benefit, and income tax expense or benefit from continuing operations. This guidance is effective for annual periods beginning after December 15, 2024, with early adoption permitted. The Company is currently in the process of evaluating the impact of this pronouncement on its related disclosures. In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses , which requires more detailed information about specified categories of expenses included in certain expense captions presented on the face of the income statement. This ASU is effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The amendments may be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of this ASU or (2) retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating the impact this ASU will have on its disclosures. Other accounting standards that have been issued by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company’s financial statements upon adoption . 13 3. Fair Value Measurements and Investments The following tables present the Company’s fair value hierarchy for its assets that are measured at fair value on a recurring basis and indicate the level of the fair value hierarchy utilized to determine such fair value: As of June 30, 2025: (in thousands) Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ — $ 40,748 $ — $ 40,748 Corporate debt securities — 6,776 — 6,776 U.S. Treasury and government securities — 5,216 — 5,216 Short-term investments: U.S. Treasury and government securities — 36,347 — 36,347 Corporate debt securities — 8,192 — 8,192 Related party short-term investment: Beam equity securities 3,407 — — 3,407 Total cash equivalents and investments $ 3,407 $ 97,279 $ — $ 100,686 As of December 31, 2024: (in thousands) Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ — $ 178,212 $ — $ 178,212 Corporate debt securities — 3,793 — 3,793 Short-term investment: U.S. Treasury and government securities — 2,998 — 2,998 Related party short-term investment: Beam equity securities 4,968 — — 4,968 Total cash equivalents and investments $ 4,968 $ 185,003 $ — $ 189,971 The Company classifies its investments as short-term based on each instrument’s underlying contractual maturity date. The fair value of investments classified as Level 2 are valued using observable inputs to quoted market prices, benchmark yields, reported trades, broker/dealer quotes or alternative pricing sources with reasonable levels of price transparency. Investments in Debt Securities Unrealized gains and losses of investments in debt securities consisted of the following: As of June 30, 2025: (in thousands) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Short-term investments in debt securities: U.S. Treasury and government securities $ 36,355 $ — $ ( 8 ) $ 36,347 Corporate debt securities 8,194 — ( 2 ) 8,192 Total short-term investments in debt securities $ 44,549 $ — $ ( 10 ) $ 44,539 14 As of December 31, 2024: (in thousands) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Short-term investments: U.S. Treasury and government securities $ 2,997 $ 1 $ — $ 2,998 Total short-term investments in debt securities $ 2,997 $ 1 $ — $ 2,998 The contractual maturities of the Company’s investments in debt securities were as follows: (in thousands) June 30, 2025 December 31, 2024 Due within one year $ 44,539 $ 2,998 Marketable securities in unrealized loss positions consisted of the following: As of June 30, 2025: (in thousands, except number of securities) Number of Securities Fair Value Gross Unrealized Losses Investments in continuous loss position for less than 12 months: U.S. Treasury and government securities 12 $ 36,347 $ ( 8 ) Corporate debt securities 9 $ 8,192 $ ( 2 ) Based on factors such as historical experience, market data, issuer-specific factors, and current economic conditions, the Company did not record an allowance for credit losses as of June 30, 2025 related to these investments. Further, given the lack of significant change in the credit risk, the Company does not consider these investments to be impaired. 4. Property and Equipment, Net Property and equipment, net consisted of the following: (in thousands) June 30, 2025 December 31, 2024 Property and equipment: Laboratory equipment $ 29,377 $ 27,343 Leasehold improvement 7,911 5,136 Furniture and Fixture 1,864 1,075 Computer hardware and software 1,122 869 Construction in progress 230 3,578 Total property and equipment 40,504 38,001 Less: Accumulated depreciation ( 16,676 ) ( 13,597 ) Total property and equipment, net $ 23,828 $ 24,404 Depreciation expense related to property and equipment is as follows: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2025 2024 2025 2024 Depreciation Expense $ 1,864 $ 1,538 $ 3,564 $ 2,853 15 5. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following: (in thousands) June 30, 2025 December 31, 2024 Accrued expenses and other current liabilities Employee compensation and benefits $ 5,818 $ 8,976 Research and clinical costs 3,660 907 License fee 1,562 1,938 Facility related 1 2,811 Other 1,117 1,272 Total accrued expenses and other current liabilities $ 12,158 $ 15,904 6. Leases The Company leases office and laboratory space under various non-cancelable operating leases. The Company’s significant lease agreements are disclosed in Note 9, Leases , in the audited consolidated financial statements for the year ended December 31, 2024, and notes thereto, included in the Company’s Annual Report on Form 10-K that was filed with the SEC on February 28, 2025. Since the date of those financial statements, there have been no changes to the Company’s significant agreements except as described below. 60 First Street, Cambridge, Massachusetts Lease In November 2021, the Company entered into a lease for three floors of office and laboratory space in Cambridge, Massachusetts, with rent commencing in March 2024, subject to any credits pursuant to the terms of the lease (the “60 First Street Lease”). Subsequent to the initial non-cancelable term of the lease of ten years , the Company has an option to extend the lease for an additional period of ten years with the rent during the extension term being the then fair market rent. The Company secured the lease with a $ 13.1 million security deposit, which was recorded as restricted cash on the condensed consolidated balance sheets as of June 30, 2025 and December 31, 2024. Accounting Considerations The Company determined that the lease contained three separate lease components, each of which represents a right of use that the Company can benefit from on its own and neither of which are highly dependent nor highly related to each other. The Company allocated the consideration among the three lease components based on their relative fair market values. In accordance with ASC 842, Leases , the lease commenced for one of the lease components in March 2024 and the Company recorded a right-of-use asset of $ 44.9 million, and a corresponding lease liability of $ 33.6 million on the lease commencement date; this included a reclass of $ 11.3 million from prepaid expenses to right-of-use asset related to build out costs which were determined to be owned by the lessor. In March 2025, the Company determined that the lease commenced on the remaining two lease components and recorded right-of-use assets of $ 76.8 million, and a corresponding lease liability of $ 78.6 million on the lease commencement date. As the exercise of the option to extend the lease term is not reasonably certain, the Company will recognize lease expense for all lease components through February 2034. In June 2024, the Company filed a complaint in Massachusetts Superior Court against NW Cambridge Property Owner, LLC (“NWC”), the Company’s landlord at 60 First Street, alleging that NWC had breached the 60 First Street Lease by, among other reasons, refusing to provide the Company with certain rental credits for the late delivery of the leased space. While this lawsuit is pending, the Company continued to make the disputed payments under the 60 First Street Lease under protest. The disputed payments are recorded within other current assets on the Company’s condensed consolidated balance sheets. Total payments made under dispute was $ 13.9 million, and $ 10.8 million as of June 30, 2025 and December 31, 2024, respectively. 16 Arsenal Street, Watertown, Massachusetts Leases In August 2024, the Company entered into the third amendment to its existing lease for approximately 16,000 square feet of combined laboratory and office space at 480 Arsenal Street, Watertown, Massachusetts (the “480 Arsenal Amendment”). In September 2024, the Company entered into a new lease for approximately 48,500 square feet of combined laboratory and office space at 500 Arsenal Street, Watertown, Massachusetts (the “500 Arsenal Lease”). The landlords of the spaces at 480 Arsenal Street and 500 Arsenal Street are affiliates. The 480 Arsenal Amendment provides the Company with an additional 9,400 square feet of combined laboratory and office space (the “Expansion Space”) at no additional cost and also provides an early termination date for the existing space and the Expansion Space. The lease for space at 480 Arsenal Street, including the Expansion Space, terminated on April 30, 2025. The 500 Arsenal Lease term commenced in December 2024 with a base term of 11 months. In December 2024, the Company began constructing improvements to the space, the construction for which was completed in 2025. Subsequent to the base term, the Company has an option to extend the lease through August 2028, which it exercised in February 2025. The Company secured the lease with a $ 0.6 million security deposit, which is recorded as restricted cash on the condensed consolidated balance sheets as of June 30, 2025. The 500 Arsenal Lease also provides a tenant improvement allowance of $ 2.4 million and an additional tenant improvement allowance of $ 1.2 million, which the Company would be obligated to repay to the landlord. The Company did not use the additional tenant improvement allowance. Accounting Considerations As the 480 Arsenal Amendment and the 500 Arsenal Lease meet the criteria for combining contracts under ASC 842, the Company determined that both 480 Arsenal Amendment and the 500 Arsenal Lease are modifications to its existing lease at 480 Arsenal Street. Within the combined contract the Company identified two separate lease components, each of which represents a right of use that the Company can benefit from on its own and none which are neither highly dependent nor highly related to the other. The Company allocated the consideration under the combined contract among the two lease components based on their relative fair market value. In calculating the allocable consideration and the fair market value of each lease component, the Company determined it is probable that it will exercise the option to extend the lease term provided under the 500 Arsenal Lease. For accounting purposes, as the construction of the lessor assets were completed, the Company determined that the 500 Arsenal Lease commenced in March 2025 and recorded right-of-use assets of $ 7.0 million, and a corresponding lease liability of $ 5.5 million on the lease commencement date. Concurrently, the Company also determined that the termination of its leased space at 480 Arsenal Street was reasonably certain, and the Company recorded a $ 3.1 million reduction to the Company’s operating lease liability and its operating lease right-of-use asset on the condensed consolidated balance sheet. 17 The table below reconciles the undiscounted future annual lease payments to the total operating lease liabilities recorded in the condensed consolidated balance sheet as of June 30, 2025: (in thousands) Undiscounted Amounts Undiscounted lease payments: Remaining in 2025 $ 10,494 2026 21,703 2027 22,355 2028 22,294 2029 21,478 Thereafter 96,601 Total undiscounted lease payments 194,925 Less: imputed interest ( 75,189 ) Total operating lease liability $ 119,736 7. Stockholder’s Equity Common Stock Under the Company’s Third Amended and Restated of Certificate of Incorporation, as amended, the Company’s common stock had a par value of $ 0.00001 and each share of common stock entitles the holder to one vote on all matters submitted to the stockholders for a vote. The holders of common stock are entitled to receive dividends, if any, as declared by the Company’s Board of Directors (the “Board of Directors”). Pre-funded Warrants In February 2024, the Company sold pre-funded warrants to purchase 3,200,005 shares of common stock at a public offering price of $ 6.24999 per pre-funded warrant, which represents the per share public offering price of each share of common stock less the $ 0.00001 per share exercise price for each pre-funded warrant. Subject to certain requirements, the pre-funded warrants can be exercised by the holder at any time. In May 2025, the holder exercised all 3,200,005 of its pre-funded warrants on a cashless basis and received 3,199,984 shares of the Company’s common stock. Following this exercise, the Company has no pre-funded warrants outstanding. August 2025 Offering In August 2025, the Company issued and sold 43,700,000 shares of its common stock, including 5,700,000 shares pursuant to the exercise of the underwriters’ option to purchase additional shares, at a price to the public of $ 3.30 per share. As a result of the offering, the Company received approximately $ 138.2 million in net proceeds, after deducting underwriting discounts, commissions and offering costs of approximately $ 6.0 million. At-The-Market Equity Program In November 2023, the Company entered into Open Market Sale Agreement SM (the “Sales Agreement”) with Jefferies LLC, acting as the Company’s agent and/or principal (the “Sales Agent”), with respect to an “at the market offering” program under which the Company may, from time to time, at its sole discretion, issue and sell shares of its common stock having an aggregate offering price of up to $ 300.0 million through the Sales Agent. Effective July 30 2025, the Company terminated the sales agreement prospectus (the “ATM Prospectus”) filed with the shelf registration statement on Form S-3 (File No. 333-275321) and related to the shares of the Company’s common stock issuable pursuant to the Sales Agreement. As a result, the Company will not make any sales of its common stock pursuant to the Sales Agreement, unless and until a new prospectus, prospectus supplement or a new 18 registration statement is filed. Other than the termination of the ATM Prospectus, the Sales Agreement remains in full force and effect. As of June 30, 2025 and as of the date these condensed consolidated financial statements are issued, the Company has not sold any shares of common stock under the ATM Prospectus. 8. Stock-Based Compensation 2019 Stock Option and Grant Plan The Company’s 2019 Stock Option and Grant Plan (the “2019 Plan”) provides for the Company to grant incentive stock options, non-qualified stock options, unrestricted stock awards, restricted stock awards and other stock-based awards to the officers, employees, consultants and other key persons of the Company. The 2019 Plan was administered by the Board of Directors, or at the discretion of the Board of Directors, by a committee of the Board of Directors. The exercise prices, vesting and other restrictions are determined at the discretion of the Board of Directors, or its committee if so delegated. In October 2022, in connection with the closing of the Company’s initial public offering (“IPO”), the Board of Directors determined that no further awards would be granted under the 2019 Plan. 2022 Stock Option and Incentive Plan On February 9, 2022, the Board of Directors adopted, and on October 10, 2022, the Company’s stockholders approved, the 2022 Stock Option and Incentive Plan (the “2022 Plan”), which became effective on October 18, 2022. The 2022 Plan allows the Company to make equity-based and cash-based incentive awards to its officers, employees, directors, and consultants. The 2022 Plan provides for the grant of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock awards, restricted stock units and other stock-based awards. The shares of common stock underlying any awards under the 2022 Plan and the 2019 Plan that are forfeited, cancelled, held back upon exercise or settlement of an award to satisfy the exercise price or tax withholding, reacquired by the Company prior to vesting, satisfied without the issuance of stock, expire, or are otherwise terminated (other than by exercise) will be added back to the shares of common stock available for issuance under the 2022 Plan. The number of shares reserved and available for issuance under the 2022 Plan increased on January 1, 2023 and will increase on each January 1 hereafter, by five percent of the outstanding number of shares of common stock on the immediately preceding December 31 or such lesser number of shares as determined by the Compensation Committee of the Board of Directors. On January 1, 2025, the annual increase resulted in an additional 6,558,042 shares authorized being added to the 2022 Plan. As of June 30, 2025, the Company had 28,080,152 shares reserved under the 2022 Plan and the 2019 Plan, and 9,478,749 shares available for issuance under the 2022 Plan. 2022 Employee Stock Purchase Plan On February 9, 2022, the Board of Directors adopted, and on October 10, 2022, the Company’s stockholders approved, the 2022 Employee Stock Purchase Plan (the “2022 ESPP”), which became effective on October 18, 2022. The number of shares of common stock that may be issued under the 2022 ESPP cumulatively increased beginning on January 1, 2023 and shall increase on each January 1 hereafter through January 1, 2032, by the least of (i) 971,350 shares of common stock, (ii) one percent of the outstanding number of shares of common stock on the immediately preceding December 31, or (iii) such number of shares of common stock as determined by the administrator of the 2022 ESPP. There was no annual increase for the 2022 ESPP on January 1, 2025. As of June 30, 2025, the Company had 1,619,579 shares available for issuance under the 2022 ESPP. During the six months ended June 30, 2025, the Company issued 133,612 shares of the Company’s common stock under the 2022 ESPP. 19 Stock Options The following table summarizes the Company’s stock option activity for the six months ended June 30, 2025: Number of Shares Weighted-Average Exercise Price Outstanding at December 31, 2024 11,410,691 $ 9.08 Granted 7,531,444 1.94 Exercised — — Cancelled or forfeited ( 2,102,462 ) 7.04 Outstanding at June 30, 2025 16,839,673 $ 6.14 Options vested and exercisable at June 30, 2025 7,106,428 $ 8.45 Options vested and expected to vest at June 30, 2025 16,839,673 $ 6.14 As of June 30, 2025, there was $ 30.5 million of total unrecognized compensation cost related to time-based unvested stock options. The Company expects to recognize such amount over a remaining weighted-average period of 2.9 years. Performance-Based Stock Options The following table summarizes the Company’s performance-based stock option activity for the six months ended June 30, 2025: Number of Shares Weighted-Average Grant Date Fair Value Outstanding at December 31, 2024 1,061,730 $ 7.31 Granted 700,000 1.34 Exercised — — Cancelled or forfeited — — Outstanding at June 30, 2025 1,761,730 $ 4.94 Vested and exercisable at June 30, 2025 845,646 $ 6.87 As of June 30, 2025, there was $ 2.1 million of total unrecognized compensation cost related to performance-based stock options. Repricing of Certain Outstanding Stock Options On June 22, 2025, the Board of Directors approved, and on August 1, 2025 (the “Repricing Date”), the Company’s stockholders approved, a one-time repricing (the “Option Repricing”) of certain outstanding stock options granted to, and held by, certain of the Company’s current employees, including its executive officers, and members of the Board of Directors through the Repricing Date (collectively, the “Eligible Optionholders”), under the 2019 Plan and 2022 Plan (collectively, the “Plans”). The Option Repricing impacted up to an aggregate of 8,285,387 shares of common stock (such options, the “Eligible Options”) that have exercise prices in excess of $ 4.04 (the “Repriced Exercise Price”), which was the closing trading price per share of the Company’s common stock on The Nasdaq Global Market on the Repricing Date. 20 Effective as of the Repricing Date, the per share exercise price of each Eligible Option held by an Eligible Optionholder on the Repricing Date was automatically reduced to the Repriced Exercise Price. Under the terms of the Option Repricing, a Repriced Option will revert to its original exercise price per share if: i. exercised prior to the 18-month anniversary of the Repricing Date for Repriced Options held by members of the Board of Directors or executive officers of the Company, as applicable, or the one-year anniversary of the Repricing Date for Repriced Options held by all other employees of the Company (each, a “Retention Date”); ii. an Eligible Optionholder’s Service Relationship (as defined in the Plans) is terminated by the Company for Cause (as defined in the applicable award agreement) prior to the applicable Retention Date; or iii. an Eligible Optionholder resigns from the Company (including as a member of the Board of Directors) for any reason prior to the applicable Retention Date, other than described below. Notwithstanding the foregoing, each Repriced Option shall retain the Repriced Exercise Price, to the extent it has not otherwise reverted to its original exercise price per share in accordance with the foregoing, and the ability to exercise such Repriced Option may be accelerated to earlier than the applicable Retention Date in the event of: i. a Sale Event (as defined in the Plans) prior to the applicable Retention Date; ii. the termination of the Eligible Optionholder’s Service Relationship by the Company without Cause or for “good reason,” or resignation by the Eligible Optionholder for “good reason,” to the extent provided for in the Eligible Optionholder’s employment agreement, offer letter or severance plan (as applicable); or iii. the Eligible Optionholder’s death or disability (as determined in accordance with the Plans, as applicable).. Except as modified by the Option Repricing, all other terms and conditions of the Repriced Options, including, without limitation, any provisions with respect to vesting and term of the Repriced Options, will remain in full force and effect. The Company is in the process of evaluating the accounting impact of the Option Repricing. Performance-Based Restricted Common Stock Awards The Company awarded restricted common stock to employees and non-employees under its 2019 Plan. The following table summarizes the Company’s performance-based restricted common stock activity for the six months ended June 30, 2025: Number of Shares Weighted-Average Grant-Date Fair Value Outstanding at December 31, 2024 3,472,546 $ 0.06 Issued — — Vested — — Repurchased — — Outstanding at June 30, 2025 3,472,546 $ 0.06 21 Stock-Based Compensation The following table below summarizes the classification of the Company’s stock-based compensation expense related to stock options and restricted common stock awards in the condensed consolidated statements of operations and comprehensive loss: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2025 2024 2025 2024 Stock-based compensation expense: Research and development $ 3,218 $ 4,221 $ 6,074 $ 6,946 General and administrative 3,107 3,870 5,932 6,354 Total stock-based compensation expense $ 6,325 $ 8,091 $ 12,006 $ 13,300 9. Significant Agreements The Company’s significant agreements are disclosed in Note 9, License and Collaboration Agreements , in the audited consolidated financial statements for the year ended December 31, 2024, and notes thereto, included in the Company’s Annual Report on Form 10-K that was filed with the SEC on February 28, 2025. Since the date of those financial statements, there have been no changes to the Company’s significant agreements except those discussed below. Bristol-Myers Squibb — Related Party Supplemental information related to the BMS Collaboration Agreement consisted of the following: (in thousands) June 30, 2025 December 31, 2024 Collaboration receivable — related party $ 120 $ — Deferred revenue — related party $ 8,315 $ 7,092 Deferred revenue, net of current — related party $ 59,562 $ 63,218 Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2025 2024 2025 2024 Revenue recognized that was included in contract liability at the beginning of the period $ 1,061 $ — $ 2,502 $ — Revenue recognized from performance obligations fully or partially satisfied in previous periods $ 5 $ — $ 3 $ — As of June 30, 2025, the aggregate amount of the transaction price allocated to performance obligations under the BMS Collaboration Agreement that are partially unsatisfied was $ 67.9 million. The Company recognizes the portion of the transaction price as the single performance obligation is satisfied, using an input method, in proportion to costs incurred to date as compared to total costs incurred and expected to be incurred in the future to satisfy the underlying obligation. Cystic Fibrosis Foundation In July 2025, the Company entered into an agreement with the Cystic Fibrosis Foundation (“CFF”), under which CFF has agreed to provide up to $ 24 million in additional funding to accelerate the development of Prime Editors designed to permanently correct cystic fibrosis-related lung disease. The $ 24 million funding will be provided in two equal tranches, subject to certain closing conditions and scientific milestones. The first tranche includes a $ 6 million equity investment in the Company, which was received as part of the August 2025 offering. 22 CFF’s additional investment builds on initial funding received under the Company’s therapeutic development agreement with CFF in January 2024. Beam Collaboration Agreement — Related Party The Company is currently engaged in arbitration proceedings with Beam Therapeutics, Inc. (“Beam”) regarding the parties’ collaboration and license agreement (the “Agreement”). A dispute arose between the parties following the Company’s March 18, 2025 announcement that it is developing a Prime Editing-based treatment for alpha-1 antitrypsin deficiency (“AATD”). On April 16, 2025, Beam filed an arbitration demand with the American Arbitration Association (“AAA”), alleging that the Company has breached the Agreement by developing a product for the treatment of AATD and by allegedly not complying with certain obligations to transfer technical information to Beam pursuant to the Agreement. Beam also makes related claims for trade secret misappropriation and various business torts based on similar allegations, including allegations made on information and belief. Beam seeks both declaratory, injunctive, and monetary relief, but has not yet quantified the amount of damages it seeks. On April 18, 2025, the Company filed an arbitration demand with the AAA seeking a declaration that the Company’s AATD program is within our “Field” as defined by the Agreement. The arbitrations have been consolidated, and the consolidated proceeding remains in its early stages. If the final resolution of the matter is adverse to the Company, the arbitration panel may provide Beam with relief including, among other things, monetary damages and/or an order that the Company cease work on its AATD program and transfer such program to Beam. 10. Net Loss per Share Basic and diluted net loss per common share attributable to common stockholders was calculated as follows: Three Months Ended June 30, Six Months Ended June 30, (in thousands, except share and per share amounts) 2025 2024 2025 2024 Numerator: Net loss attributable to common stockholders $ ( 52,591 ) $ ( 55,327 ) $ ( 104,481 ) $ ( 101,088 ) Denominator: Weighted-average common shares outstanding, basic and diluted 129,185,918 119,188,866 128,439,349 111,827,522 Net loss per share attributable to common stockholders, basic and diluted $ ( 0.41 ) $ ( 0.46 ) $ ( 0.81 ) $ ( 0.90 ) Diluted net loss per share available to common stockholders is computed by giving effect to all potentially dilutive common stock equivalents outstanding for the period. For purposes of this calculation, preferred stock, unvested restricted stock and stock options to purchase common stock were considered common stock equivalents but had been excluded from the calculation of diluted net loss per share available to common stockholders as their effect was anti-dilutive. In periods in which the Company reports a net loss available to common stockholders, diluted net loss per share available to common stockholders is the same as basic net loss per share available to common stockholders, since dilutive common shares are not assumed to have been issued if their effect is anti-dilutive. The following common stock equivalents were excluded from the calculation of diluted net loss per share applicable to common stockholders for the periods indicated because including them would have had an anti-dilutive effect: As of June 30, 2025 2024 Anti-dilutive common stock equivalents: Options to purchase common stock 17,685,319 12,007,443 Unvested restricted common stock 3,472,546 3,729,877 Total anti-dilutive common stock equivalents: 21,157,865 15,737,320 23 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS You should read the following discussion and analysis of our financial condition and results of operations together with our condensed consolidated financial statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q and our audited consolidated financial statements and notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on February 28, 2025. As discussed in the section titled “Special Note Regarding Forward-Looking Statements,” the following discussion and analysis contains forward-looking statements that involve risks and uncertainties, such as statements regarding our plans, objectives, expectations, intentions, or projections, as well as assumptions that, if they never materialize or prove incorrect, could cause our results to differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in the “Risk Factors” section of our Annual Report on Form 10-K for the year ended December 31, 2024. Our historical results are not necessarily indicative of the results that may be expected for any period in the future. Overview We are a biotechnology company committed to delivering a new class of differentiated one-time curative genetic therapies. We are deploying Prime Editing technology, which we believe is a versatile, precise, and efficient gene editing technology. Going forward, we will focus our resources on advancing our in vivo liver franchise, where we are advancing programs to cure two of the largest genetic liver diseases, Wilson’s Disease and Alpha-1 Antitrypsin Deficiency, or AATD. Both programs are currently in late stages of pre-clinical development and are on track for IND and/or CTA filings in the first half of 2026 for Wilson’s Disease and the middle of 2026 for AATD. We intend to leverage the modularity of our platform to expeditiously and efficiently develop these programs supported by our universal liver lipid nanoparticle along with potential regulatory, clinical and other synergies from our modular technology. We will also continue our in vivo Cystic Fibrosis program with support from the Cystic Fibrosis Foundation, and our efforts to develop Prime Edited CAR-T products for hematology, immunology and oncology in partnership with Bristol-Myers Squibb Company. In addition, we will continue to pursue additional business development opportunities to accelerate innovation, ensure the broadest application of Prime Editing, and further bolster our financial resources. For example, in July 2025, we announced that the Cystic Fibrosis Foundation has agreed to provide us with up to $24 million in additional funding to accelerate the development of Prime Editors designed to permanently correct cystic fibrosis-related lung disease. The Cystic Fibrosis Foundation’s additional investment builds on initial funding received under our therapeutic development agreement with the Cystic Fibrosis Foundation in January 2024, and reflects its interest in Prime Editing as a potentially curative approach for cystic fibrosis. We intend to leverage the technology’s versatility and modularity to address multiple disease-causing mutations, potentially treating the vast majority of people with cystic fibrosis. We will initially focus on a program targeting G542X, one of the most prevalent cystic fibrosis-causing nonsense mutations and one for which there are no available therapies. In addition, we will continue to advance hotspot and PASSIGE-based approaches for other mutations with funding received from the Cystic Fibrosis Foundation under its initial commitment in 2024. We recently announced initial data from the first patient dosed in our Phase 1/2 trial in chronic granulomatous disease, or CGD. In this patient dosed, a single dose of PM359, our candidate for the treatment of CGD, led to 58% dihydrorhodamine positivity by Day 15, 66% by Day 30 and 71% by Day 60, exceeding levels of dihydrohomadine positivity believed to be potentially curative. In the second patient dosed in the trial, a single dose of PM359 led to a 70% dihydrorhodamine positivity by day 15 and 80% by day 30. In both patients, we also observed successful manufacturing from a single mobilization, no serious adverse events related to PM359 and rapid neutrophil and platelet engraftment when compared to other commercially available autologous genetic therapy benchmarks. We continue to believe PM359 has the potential to transform the care of p47phox CGD. We are planning to have regulatory interactions based on the current data set. 24 Components of Our Results of Operations Revenues To date, we have not generated any revenue from product sales and do not expect to generate any revenue from the sale of products for the foreseeable future. Our revenues to date have been generated through research collaboration and license agreements. We recognize revenue over the expected performance period under each agreement. We expect that our revenue for the next several years will be derived primarily from our current collaboration agreements and any additional collaborations that we may enter into in the future. To date, we have not received any royalties under any of our existing collaboration agreements. Research and Development Expenses Research and development expenses consist primarily of costs incurred in connection with the development and research of our immediate target indications and our differentiation target indications. These expenses include: • personnel-related expenses, including salaries, bonuses, benefits and stock-based compensation for employees engaged in manufacturing, research and development functions; • expenses incurred in connection with continuing our current research programs and preclinical and clinical development of any product candidates we may identify, including under agreements with third parties, such as consultants and contractors; • the cost of developing and validating our manufacturing process for use in our preclinical and clinical studies; • laboratory supplies and research materials; • facilities, depreciation and other expenses related to research and development activities, which include direct or allocated expenses for rent and maintenance of facilities, and utilities; • the cost allocated to acquire in-process research and development, with no alternative future use associated with asset acquisitions or transactions to license intellectual property, such as our Broad License Agreement; and • expenses incurred in connection with our Pledge to Broad Institute. We expense all research and development costs in the periods in which they are incurred. Most of our research and development expenses have been related to early stage development activities. In the future, external research and development costs for any individual product candidate will be tracked commencing upon product candidate nomination. We do not allocate employee costs, costs associated with our discovery efforts, laboratory supplies, and facilities expenses, including depreciation or other indirect costs, to specific product development programs because these costs are deployed across multiple programs and our platform and, as such, are not separately classified. Upfront and milestone payments made are accrued for and expensed when the achievement of the milestone is probable up to the point of regulatory approval. Milestone payments made upon regulatory approval will be capitalized and amortized over the remaining useful life of the related product. We expect our research and development expenses to continue to increase substantially for the foreseeable future with our planned research and development activities related to developing any future product candidates, including investments in manufacturing, as we advance any product candidates we may identify and begin to conduct clinical trials, and with our obligations under the BMS Collaboration Agreement. General and Administrative Expenses General and administrative expenses consist of salaries and personnel-related costs, including stock-based compensation, for our personnel in executive, legal, finance and accounting, human resources and other administrative functions. General and administrative expenses also include legal fees relating to patents and 25 corporate matters; professional fees paid for accounting, auditing, consulting and tax service; insurance costs; office and information technology costs; and facilities, depreciation and other general and administrative expenses, which include direct or allocated expenses for rent and maintenance of facilities and utilities. We anticipate that our general and administrative expenses will increase in the future as we increase our headcount to support research and development activities; increased accounting, legal, insurance, and investor and public relations costs as we continue to operate as a public company; and additional intellectual property-related expenses as we file patent applications to protect innovations arising from our research and development activities. Other Income (Expense) Other income (expense), net primarily consists of interest and other income earned on our short-term investments and the change in the fair value of our short-term investment in Beam Therapeutics Inc. (“Beam”), a related party, in connection with the Beam Collaboration Agreement, which is discussed in greater detail in Note 9, License and Collaboration Agreements , to the audited consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2024. Results of Operations Comparison of the Three Months Ended June 30, 2025 and 2024 Operating Expenses Research and Development Expenses Three Months Ended June 30, (in thousands) 2025 2024 Change Research and development expenses: Personnel expenses $ 14,448 $ 16,198 $ (1,750) Facility related 13,765 11,302 2,463 Research costs 8,116 11,390 (3,274) License, intellectual property fees, and other 2,812 1,250 1,562 Professional and consultant fees 1,660 1,281 379 Clinical expense 574 1,650 (1,076) Total research and development expenses $ 41,375 $ 43,071 $ (1,696) The $1.7 million decrease in research and development expense for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024 was primarily driven by: • $3.3 million decrease in research costs due to the deprioritization of our CGD programs as we strategically focus our internal efforts on advancing our in vivo liver franchise; • $1.8 million decrease in personnel expenses, driven primarily by a decrease of $1.0 million in stock-based compensation expense and fewer R&D personnel resulting from workforce reduction; and • $1.1 million decrease in clinical expenses due to the deprioritization of our CGD programs and discontinuation of our efforts to independently advance our PM359 program to focus on our liver franchise and programs funded through external partnerships. These were offset by: • $2.5 million increase in facility-related expense primarily due to the expansion and build out of our laboratory space at 60 First Street and 500 Arsenal Street; and • $1.6 million increase in license and IP costs as we advance our in vivo liver franchise and pipeline. 26 General and Administrative Expenses Three Months Ended June 30, (in thousands) 2025 2024 Change General and administrative expenses: Personnel expenses $ 7,082 $ 6,956 $ 126 Professional and consultant fees 3,956 2,821 1,135 Facility related and other 2,079 2,824 (745) Total general and administrative expenses $ 13,117 $ 12,601 $ 516 The $0.5 million increase in general and administrative expense for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024 is primarily driven by a $1.1 million increase in professional and consultant fees due to an increase in corporate legal expenses. Other Income (Expense) Three Months Ended June 30, (in thousands) 2025 2024 Change Other income: Interest income $ 743 $ 611 $ 132 Accretion (amortization) of investments 530 1,486 (956) Change in fair value of short-term investment — related party (505) (1,925) 1,420 Other income, net 18 39 (21) Total other income, net $ 786 $ 211 $ 575 Change in Fair Value of Related Party Short-Term Investment The change in fair value of related party short-term investment for each of the periods presented is a result of Beam’s stock price movement. Comparison of the Six Months Ended June 30, 2025 and 2024 Operating Expenses Research and Development Expenses Six Months Ended June 30, (in thousands) 2025 2024 Change Research and development expenses: Personnel expenses $ 29,248 $ 31,205 $ (1,957) Facility related 24,734 18,636 6,098 Research costs 19,152 23,009 (3,857) License, intellectual property fees, and other 4,237 2,925 1,312 Professional and consultant fees 2,819 2,873 (54) Clinical expense 1,747 2,197 (450) Total research and development expenses $ 81,937 $ 80,845 $ 1,092 27 The $1.1 million increase in research and development expense for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024 was primarily driven by: • $6.1 million increase in facility-related expense primarily due to the expansion and build out of our laboratory space at 60 First Street and 500 Arsenal Street; and • $1.3 million increase in license and IP costs as we advance our in vivo liver franchise and pipeline. This is offset by: • $3.9 million decrease in research costs due to the deprioritization of our CGD programs as we strategically focus our internal efforts on advancing our in vivo liver franchise; and • $2.0 million decrease in personnel expenses, driven primarily by a decrease of $0.9 million in stock-based compensation expense and fewer R&D personnel resulting from the workforce reduction. General and Administrative Expenses Six Months Ended June 30, (in thousands) 2025 2024 Change General and administrative expenses: Personnel expenses $ 14,238 $ 12,840 $ 1,398 Professional and consultant fees 7,228 5,931 1,297 Facility related and other 4,935 4,988 (53) Total general and administrative expenses $ 26,401 $ 23,759 $ 2,642 The $2.6 million increase in general and administrative expense for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024 is primarily driven by: • $1.4 million increase in personnel expenses in connection with the reduction in force, primarily consisting of one-time severance payments and other employee termination-related expenses; and • $1.3 million increase in professional and consultant fees due an increase in corporate legal expenses. Other Income (Expense) Six Months Ended June 30, (in thousands) 2025 2024 Change Other income: Interest income $ 1,925 $ 1,287 $ 638 Accretion (amortization) of investments 869 2,316 (1,447) Change in fair value of short-term investment — related party (1,561) (759) (802) Other income, net 55 81 (26) Total other income, net $ 1,288 $ 2,925 $ (1,637) Accretion (amortization of investments Accretion (amortization) of investments for each of the periods presented is a result of increase (decrease) in the value of the our marketable securities purchased at a discount (premium) to their face value. 28 Liquidity and Capital Resources Since our inception, we have incurred significant operating losses. We expect to incur significant expenses and operating losses for the foreseeable future as we advance the preclinical development of our current research programs, commence the clinical development of any product candidates we may identify, and continue our platform development and early-stage research activities. We have not yet commercialized any products and we do not expect to generate revenue from sales of products for several years, if at all. To date, we have funded our operations primarily with proceeds from sales of preferred stock and from our public offerings and through payments from our collaboration partners. As of June 30, 2025, we had cash, cash equivalents, and investments of $101.8 million, excluding our restricted cash, or $115.4 million, including restricted cash. In November 2023, we entered into an Open Market Sale Agreement SM (the “Sales Agreement”) with Jefferies LLC (“Jefferies”) under which we may, from time to time, issue and sell shares of our common stock having aggregate sales proceeds of up to $300.0 million, in a series of one or more at-the-market equity offerings (the “ATM Program”). Effective July 30, 2025, we terminated the sales agreement prospectus (the “ATM Prospectus”) filed with the shelf registration statement on Form S-3 (File No. 333-275321) and related to the shares of our common stock issuable pursuant to the Sales Agreement. As a result, we will not make any sales of our common stock pursuant to the Sales Agreement, unless and until a new prospectus, prospectus supplement or a new registration statement is filed. Other than the termination of the ATM Prospectus, the Sales Agreement remains in full force and effect. As of the date of this Quarterly Report on Form 10-Q, we have not sold any shares of common stock under the 2023 ATM program. In August 2025, we issued and sold 43,700,000 shares of our common stock, including 5,700,000 shares pursuant to the exercise of the underwriters’ option to purchase additional shares, at a price to the public of $3.30 per share. As a result of the offering, we received approximately $138.2 million in net proceeds, after deducting underwriting discounts, commissions and offering costs of approximately $6.0 million. Cash Flows The following table summarizes our sources and uses of cash for each of the periods presented: Six Months Ended June 30, (in thousands) 2025 2024 Net change in cash, cash equivalents and restricted cash: Net cash used in operating activities $ (90,269) $ (113,198) Net cash used in investing activities (44,971) (30,138) Net cash provided by financing activities 6,197 157,362 Net change in cash, cash equivalents, and restricted cash $ (129,043) $ 14,026 Operating Activities Net cash used in operating activities for the six months ended June 30, 2025 was driven primarily by the following uses of cash: • $104.5 million net loss; • $2.4 million change in deferred revenue — related party; • $2.1 million change in lease liabilities • $1.7 million change in accrued expenses and other current liabilities; and • $1.5 million change in accounts payable. 29 These were offset by $21.3 million of non-cash amounts included in net loss, which primarily consisted of stock-based compensation expense, non-cash lease expense, depreciation expense, and change in fair value of short-term investment — related party. Net cash used in operating activities for the six months ended June 30, 2024 was driven primarily by the following uses of cash: • $101.1 million net loss; • $13.5 million change in accrued settlement payment — related party; • $9.2 million change in accounts payable; • $5.7 million change in lease liabilities; • $3.9 million change in accrued expenses and other current liabilities; and • $2.5 million change in prepaid and other current assets. These were offset by $22.8 million of non-cash amounts included in net loss, which primarily consisted of stock-based compensation expense, non-cash lease expense, and depreciation expense. Investing Activities Net cash used in investing activities for the six months ended June 30, 2025 was driven primarily by the following: • $41.0 million of purchases of marketable securities, net of maturities; and • $4.0 million of purchases of property and equipment. Net cash used in investing activities for the six months ended June 30, 2024 was driven primarily by the following: • $25.9 million of purchases of marketable securities, net of maturities; and • $4.2 million of purchases of property and equipment. Financing Activities Net cash provided by financing activities for the six months ended June 30, 2025 was driven by $6.0 million of proceeds received under our agreement with Cystic Fibrosis Foundation. Net cash provided by financing activities for the six months ended June 30, 2024 was driven primarily by the following: • $132.1 million of proceeds from issuances of common stock in our February 2024 public offering; • $18.8 million of proceeds from issuance of pre-funded warrants contemporaneous with our February 2024 public offering; and • $6.0 million of proceeds received under our agreement with Cystic Fibrosis Foundation. Funding Requirements To date, we have not generated any revenue from product sales. We do not expect to generate revenue from product sales unless and until we successfully complete preclinical and clinical development of, receive regulatory approval for, and commercialize a product candidate and we do not know when, or if at all, that will occur. We expect our expenses to increase in connection with our ongoing activities, particularly as we advance the preclinical activities and studies and initiate clinical trials. In addition, if we obtain regulatory approval for any product candidates, we expect to incur significant expenses related to product sales, marketing, and distribution to the extent that such sales, 30 marketing and distribution are not the responsibility of potential collaborators. Further, we have incurred, and expect to continue to incur, costs associated with operating as a public company. The timing and amount of our operating expenditures will depend largely on the factors set out above. For more information, refer to the section titled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2024, and the “Risk Factors” section of subsequent Quarterly Reports on Form 10-Q. We believe our existing cash, cash equivalents, and investments, including funds from our August 2025 offering, will be sufficient to fund our operating expenses and capital expenditure requirements into 2027. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. We expect that we will require additional funding to: • continue our current research development activities; • identify product candidates; • evaluate strategic alternatives and potential partnership opportunities for PM359, including our ability to execute and realize the anticipated benefits of any strategic alternatives we may pursue; • develop, maintain, expand and protect our intellectual property portfolio and defend intellectual property-related claims; • maintain existing collaborations or strategic relationships and identify and enter into future license agreements and collaborations with third parties; • initiate preclinical testing and clinical trials for our future product candidates we identify; • further develop our Prime Editing platform; and • hire additional personnel to support our strategic priorities. If we receive regulatory approval for any of our product candidates, we expect to incur significant commercialization expenses related to product manufacturing, sales, marketing and distribution, depending on where we choose to commercialize ourselves. Until such time, if ever, as we can generate substantial product revenue, we expect to finance our cash needs through a combination of private and public equity offerings, debt financings, additional collaborations, strategic alliances, and marketing, distribution or licensing arrangements with third parties. To the extent that we raise additional capital through the sale of equity or convertible debt securities, ownership interest may be materially diluted, and the terms of such securities could include liquidation or other preferences that adversely affect your rights as a common stockholder. Debt and equity financing, if available, may involve agreements that include restrictive covenants that limit our ability to take specified actions, such as incurring additional debt, making capital expenditures or declaring dividends. If we raise funds through collaborations, strategic alliances or marketing, or distribution or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, any future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt financings or other arrangements when needed, we may be required to delay, reduce or eliminate our product development or future commercialization efforts, or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves. Contractual Obligations and Other Commitments We enter into contracts in the normal course of business with contract organizations and other vendors to assist in the performance of our research and development activities, and other services and products for operating purposes. These contracts generally provide for termination on notice, and therefore are cancellable contracts and not included in the table of contractual obligations and commitments. During the six months ended June 30, 2025, except for the minimum lease commitments disclosed in Note 6, Leases , to the unaudited condensed consolidated financial statements in this Quarterly Report on Form 10-Q, there 31 were no significant changes to our contractual obligations and commitments described under Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2024. Critical Accounting Policies and Significant Judgments and Estimates Our management’s discussion and analysis of our financial condition and results of operations is based on our condensed consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses incurred during the reporting periods. We base our estimates on historical experience, known trends and events, and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities recorded revenues and expenses that are not readily apparent from other sources. We evaluate our estimates and assumptions on an ongoing basis. Actual results may differ from these estimates. During the six months ended June 30, 2025, there were no material changes to our critical accounting policies and significant judgements described under Management’s Discussion and Analysis of Critical Accounting Policies and Significant Judgments and Estimates which are included in our Annual Report on Form 10-K for the year ended December 31, 2024. Recently Issued and Adopted Accounting Pronouncements A description of recently issued accounting pronouncements that may potentially impact our financial position and results of operations is disclosed in Note 2, Summary of Significant Accounting Policies , to our audited financial statements for the year ended December 31, 2024, and notes thereto, included in our Annual Report on Form 10-K and in this Quarterly Report on Form 10-Q. Emerging Growth Company Status The Jumpstart Our Business Startups Act of 2012 permits an “emerging growth company” such as us to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies until those standards would otherwise apply to private companies. We have elected not to “opt out” of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we will adopt the new or revised standard at the time private companies adopt the new or revised standard and will do so until such time that we either (i) irrevocably elect to “opt out” of such extended transition period or (ii) no longer qualify as an emerging growth company. As a result of this election, our condensed consolidated financial statements may not be comparable to other public companies that comply with new or revised accounting pronouncements as of public company effective dates. We may choose to early adopt any new or revised accounting standards whenever such early adoption is permitted for private companies.