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Item 1. Business

2026-03-03 compared with 2025-03-17 · 553 added, 627 removed, 1498 unchanged (44% of the section changed)

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We view engineered cells as having the potential to be as therapeutically disruptive as biologic drugs to clinical practice, enabling us to repair cells in the body when possible and replace them when needed.

We are developing ex vivo and in vivo cell engineering platforms to revolutionize treatment across a broad array of therapeutic areas with unmet treatment needs, including type 1 diabetes, B cell mediated autoimmune diseases, and oncology.

We have developed ex vivo and in vivo cell engineering platforms to revolutionize treatment across a broad array of therapeutic areas with unmet treatment needs, including type 1 diabetes, oncology, and B cell mediated autoimmune diseases.

For our ex vivo platform, we have made focused investments in our hypoimmune platform technology, which we refer to as our HIP technology, with the twin goals of engineering allogeneic cells that can "hide" from the patient's immune system to overcome the fundamental challenge of immune rejection and cell persistence and that we can manufacture at scale.

A successful therapeutic requires cells that can engraft, function, and persist in the body, and we believe our approach can unlock a wave of disruptive therapeutics.

For in vivo therapies that aim to repair and control genes in the body, a successful product candidate requires both gene modification and in vivo delivery of the therapeutic payload.

Of these, we view effective in vivo delivery as the greatest current limitation to dramatically expanding the impact of this class of therapeutics.

To this end, our initial focus is on cell-specific delivery of genetic payloads that integrate into the genome of the target cells.

We currently focus our efforts across three areas and have three ongoing clinical trials across multiple disease types and therapeutic areas, including type 1 diabetes (T1D), B cell mediated autoimmune diseases, and B cell malignancies.

A successful therapeutic requires cells that can engraft, function, and persist in the body, and we believe our approach can unlock a wave of disruptive therapeutics, starting in type 1 diabetes.

For in vivo therapies that aim to repair or control genes in the body, a successful product candidate requires both gene modification and in vivo delivery of the therapeutic payload.

Our initial focus is on cell-specific delivery of genetic payloads, known as chimeric antigen receptors (CARs), to a patient’s T cells, resulting in the generation and proliferation of CAR T cells, which have been shown to deplete a patient’s disease-causing B cells.

We are currently focused on advancing two distinct therapeutics, each of which leverages one of these platform technologies.

SC451 is our HIP-edited product candidate for the treatment of type 1 diabetes.

SG293 is our in vivo CAR T product candidate for the treatment of B cell malignancies and B cell mediated autoimmune diseases.

• Type 1 Diabetes :

Approximately nine million people suffer from type 1 diabetes (T1D) worldwide, and there have been no major novel medicines for the disease since insulin.

Almost ten million people suffer from type 1 diabetes (T1D) worldwide, and there has been limited progress in treatments for this disease since the advent of insulin injections over 100 years ago.

We are developing SC451, a HIP-modified, stem cell-derived pancreatic islet cell therapy, for the treatment of T1D.

The goal of this therapy is euglycemia, or normal blood glucose, without the need for exogenous insulin injections or immunosuppression.

We currently have an ongoing investigator-sponsored first-in-human study (IST) evaluating UP421, an allogeneic, primary islet cell therapy engineered with our HIP technology, in patients with T1D.

Sana expects to share additional data in 2025 and file an investigational new drug application (IND) for SC451 as early as 2026.

• Allogeneic CAR T cells :

We are developing SC291, our HIP-modified allogeneic CD19-dirtected allogeneic CAR T cell product candidate, in patients with B cell mediated autoimmune diseases.

The GLEAM study is a Phase 1 clinical trial evaluating SC291 in patients with lupus nephritis (LN), extrarenal lupus (ERL), and antineutrophil cytoplasmic antibody (ANCA)-associated vasculitis.

If successful, SC291 has the potential to benefit patients in a number of additional B cell-mediated autoimmune diseases.

We are also studying SC262, our HIP-modified allogeneic CD22-directed CAR T cell product candidate.

The VIVID study is a Phase 1 clinical trial evaluating SC262 in patients with relapsed and/or refractory (R/R) B cell malignancies who have received prior CD19-directed CAR T therapy.

Sana is enrolling patients in both the GLEAM and VIVID trials and expects to share data from each study in 2025.

Through a first-in-human investigator-sponsored study (IST), we have shown that UP421, an allogeneic, primary islet cell therapy engineered with our HIP technology, can survive and function for twelve months post-transplant in a patient with T1D without the need for immunosuppression.

We have incorporated this HIP technology into a more scalable manufacturing platform with SC451 and expect to file an investigational new drug application (IND) as well as begin a Phase 1 clinical trial for this therapy as early as this year.

• In vivo CAR T cells :

We are developing SG299, a CD8-targeted fusosome that leverages our fusogen platform technology.

This platform enables cell-specific, in vivo delivery of various payloads, allowing SG299 to deliver genetic material to CD8+ T cells that directs them to become CD19-targeting CAR T cells, while avoiding delivery to potentially problematic tissues such as the liver and gonads.

Sana plans to develop SG299 in a range of B cell cancers and B cell mediated autoimmune diseases and expects to file an IND for SG299 as early as 2026.

In December 2024, UP421, a HIP-modified allogeneic primary islet cell product, was transplanted into a patient with T1D in the IST, which is being conducted at Uppsala University Hospital.

This Phase 1 study evaluates the safety of UP421 when transplanted intramuscularly into a patient with T1D.

Secondary endpoints include immune evasion measured in peripheral blood, non-fasting C-peptide concentrations (which is a measure of the body’s insulin production) in peripheral blood, C-peptide response to a mixed meal tolerance test (MMTT), and graft survival assessed by magnetic resonance imaging (MRI).

The transplantation was performed without immunosuppression, steroids, or any supportive medication to facilitate allogeneic cell survival.

As a first-in-human study, the primary endpoint was safety and the dose was approximately 2% to 7% of islet cells that would typically be needed for insulin independence.

In January 2025, we announced positive results from the IST at four weeks after cell transplantation, which demonstrated the survival and function of pancreatic beta cells as measured by the presence of circulating C-peptide, a biomarker indicating that transplanted beta cells are producing insulin.

Positive preliminary twelve-week clinical results, building on the four-week results, demonstrate that all primary and secondary endpoints were met.

Using our fusogen platform, which enables cell-specific, in vivo delivery of various payloads, we are developing SG293, a CD8-targeted fusosome.

SG293 delivers genetic material to CD8+ T cells, which enables them to become CD19-targeting CAR T cells while avoiding potentially problematic delivery to tissues such as the liver and gonads.

In vivo CAR T cells have the potential to provide the clinical benefit of autologous, ex vivo manufactured CAR T cells while avoiding the need for lymphodepleting chemotherapy as well as significant complexity and delays related to manufacturing.

SG293 builds on data from our prior lead in vivo CAR T product candidate, SG299.

We plan to develop SG293 in a range of B cell cancers and B cell mediated autoimmune diseases and expect to generate initial clinical data as early as this year.

SC451 is our lead program for T1D.

T1D is a disease in which the patient’s immune system attacks and kills the patient’s pancreatic beta cells, the only cells in the human body that make insulin, leading to a complete loss of insulin production in affected individuals.

Insulin is essential for normal cellular metabolism, and prior to the discovery of insulin replacement therapy over 100 years ago, a person typically died within months of diagnosis.

Insulin therapy has meaningfully improved patient outcomes, but even with state-of-the-art medical care and technology and glucose control, a person with T1D will live approximately a decade less than somebody without the disease and have a significant treatment burden for life.

In contrast, our goal is to develop a one-time treatment that leads to normal blood glucose with no insulin injections and no immunosuppression, in an effort to restore the patient to a life similar to that from before the T1D diagnosis.

Pancreatic islets are comprised of pancreatic beta cells and other endocrine cells.

Scientists have shown that transplanted pancreatic islets can allow patients to come off insulin and maintain normal blood glucose.

These islets can be obtained from deceased donors or derived from stem cells.

However, the impact of these therapies has been limited, as patients must remain on life-long systemic immunosuppression to prevent the patient’s immune system from rejecting these transplanted cells.

The potential complications of immunosuppression, which include increased susceptibility to infection, heightened cancer risk, cardiovascular disease, metabolic syndrome, chronic kidney disease, and osteoporosis, outweigh the potential benefits of these treatments in most patients.

Our HIP technology is designed to hide transplanted cells from immune recognition and rejection.

In addition to extensive pre-clinical testing, the ability of our HIP technology to hide transplanted pancreatic islets from immune recognition and rejection has been demonstrated in a human.

In December 2024, UP421, a HIP-modified allogeneic primary islet cell therapy, was transplanted into a patient with T1D in an IST conducted at Uppsala University Hospital.

This study evaluates the safety of UP421 when transplanted intramuscularly into a patient with T1D.

Secondary endpoints include immune evasion, non-fasting C-peptide concentrations in peripheral blood, C-peptide response to a mixed meal tolerance test (MMTT), and graft survival assessed by magnetic resonance imaging (MRI) and Positron Emission Tomography (PET/MRI).

Pancreatic beta cells produce pro-insulin, which is cleaved and secreted as insulin and C-peptide in a 1:1 ratio, making C-peptide a well-established biomarker of endogenous insulin production.

The 42-year-old recipient, who had been living with T1D for over 30 years, received a single transplant of UP421 into the muscle of the forearm.

The transplantation was performed without immunosuppression, steroids, or any supportive medication to facilitate allogeneic cell survival.

As a first-in-human study, the primary endpoint was safety, and the dose was approximately 7% of islet cells that would typically be needed for insulin independence.

In September 2025, 12-week data from the IST were published in The New England Journal of Medicine .

In addition, we recently reported that at 12 months following transplantation, the UP421 first-in-human study continues to demonstrate durable safety, survival, and function of the transplanted HIP-modified primary islet cells.

The primary endpoint of safety was achieved, with no drug product-related adverse events reported.

Prior to transplant, C-peptide levels were undetectable both in the non-fasting state and in response to an MMTT.

Pancreatic beta cells produce pro-insulin, which is cleaved and secreted as insulin and C-peptide in a 1:1 ratio, making C-peptide a well-established biomarker of endogenous insulin production.

Results of the study at four- and twelve-weeks after cell transplantation demonstrate the survival and function of pancreatic beta cells as measured by the presence of circulating C-peptide.

C-peptide levels also increase with an MMTT during testing at these timepoints, consistent with insulin secretion in response to a meal.

MRI scanning also demonstrated a sustained signal at the site of transplanted cells over time, which is consistent with graft survival.

No inflammation or safety-related signals were observed.

Results of the study through twelve months following transplantation demonstrate the survival and function of pancreatic beta cells as measured by the presence of circulating C-peptide.

C-peptide levels also increased with an MMTT during testing at these timepoints, consistent with insulin secretion in response to a meal.

PET/MRI imaging results at 12 weeks and 12 months are consistent with pancreatic beta cell survival and function in the forearm muscle of the patient.

The UP421 drug product contains a mixture of islet cell populations:

wild-type (WT) islet cells expressing HLA class I and class II, double knockout (DKO) islet cells with HLA class I and class II eliminated, and HIP islet cells with both HLA class I and class II eliminated plus CD47 overexpression.

WT islet cells triggered a robust immune response, with peak T cell activation at day 7 following transplantation, followed by T cell-mediated killing, and development of donor-specific antibodies.

We performed assays testing the patient’s various immune cell responses to these different populations of cells in the drug product.

Consistent with expectations post-transplantation of allogeneic tissue, WT islet cells triggered a robust immune response with T cell-mediated killing and development of donor-specific antibodies.

DKO islet cells, while avoiding T cell activation and antibody responses, were rapidly eliminated by natural killer (NK) cells.

In contrast, HIP islet cells demonstrated comprehensive immune evasion, with no evidence of T cell activation, donor-specific antibody development, or NK cell-mediated killing through twelve weeks.

These distinct immune responses were further validated in whole blood assays, in which HIP islet cells uniquely survived exposure to the patient's PBMCs while both WT and DKO islet cells were eliminated.

In contrast, HIP islet cells demonstrated comprehensive immune evasion, with no evidence of T cell activation, donor-specific antibody development, or NK cell-mediated killing.

These distinct immune responses were further validated in whole blood assays, in which HIP islet cells survived exposure to the patient's peripheral blood mononuclear cells (PBMCs) while both WT and DKO islet cells were eliminated.

These in vitro assay results are consistent throughout the 52 weeks of the study to date.

For additional information on the genetic modifications discussed above, see the sections titled “Background on Immunological Barriers to ex vivo Therapies and Current Limitations,” “Our Solution – Hypoimmune Technology,” and “Designing Hypoimmune Cells” below.

To our knowledge, this study is the first example of successful transplantation with no immunosuppression into a person with an intact immune system to demonstrate survival and function of allogeneic cells.

We believe these initial results with HIP-modified cells represent a significant milestone for the field of cell therapy.

We believe these results with HIP-modified cells represent a significant milestone for the field of cell therapy.

These cells not only had to overcome the typical rejection of allogeneic cells, they also needed to overcome the pre-existing autoimmune response to pancreatic beta cells.

The results are a key landmark in our effort to develop SC451, our HIP modified stem cell-derived pancreatic islet cell product candidate, as an off-the-shelf cell therapy for patients with T1D.

The 12-week data remain subject to source data verification, after which we and our collaborators at Uppsala University Hospital expect to publish in scientific journals and/or present at scientific conferences more details and longer follow-up from this study in 2025 and beyond.

We expect to submit an IND for SC451 as early as 2026.

GLEAM is a Phase 1 clinical trial evaluating SC291 in patients with LN, ERL, and ANCA-associated vasculitis.

Clinical studies conducted by third parties evaluating B cell depleting agents in B cell mediated autoimmune disease have established that deep B cell depletion is an important correlate of clinical activity, with deeper B cell depletion correlating with better clinical activity for the agents.

We have also studied SC291 in patients with B cell malignancies in a trial we refer to as ARDENT, in which we have seen a tolerable safety profile.

Among sixteen patients, we observed no cases of Grade 2 or higher cytokine release syndrome (CRS), of any Grade immune effector cell-associated neurotoxicity syndrome (ICANS), or of graft versus host disease (GvHD).

We observed a single case of Grade 1 immune effector cell associated hemophagocytic lymphohistiocytosis-like syndrome (IEC-HS).

All six evaluable non-Hodgkin's lymphoma (NHL) patients treated at the two highest cell dose cohorts showed deep B cell depletion.

We are optimistic that if we observe safe and deep B cell depletion in the GLEAM study similar to that observed in these cohorts of the ARDENT study, then SC291 could have a meaningful clinical benefit for patients in the autoimmune indications being evaluated in GLEAM.

In December 2024, the U.S.

Food and Drug Administration (FDA) granted Fast Track designation for SC291 in relapsed/refractory systemic lupus erythematosus (SLE), which includes LN and ERL.

Fast Track designation is designed to facilitate development and expedite review of drugs that address serious conditions and unmet medical needs.

With respect to our in vivo cell engineering research efforts, in January 2025, we shared data from preclinical studies involving our SG299 CAR T cell fusosome product candidate, a CD8-targeted fusosome that delivers a CD19 CAR to target CD19+ cells.

In a non-human primate (NHP) study exploring the potential efficacy of this therapy, intravenous (IV) injection of a surrogate SG299 together with an additional component resulted in the generation of CAR T cells that induced deep B cell depletion in the peripheral blood and lymph nodes at 28 days.

We believe that deep B cell depletion is an important biomarker for potential efficacy in patients with B cell mediated autoimmune diseases and B cell mediated cancers.

Separately, in a good laboratory practice (GLP) toxicology study in NHPs, we observed that a single IV injection of SG299 demonstrated selective, dose-dependent gene delivery to CD8+ T cells.

Tissue analysis showed minimal to no quantifiable presence in non-target tissues, including the liver and gonadal tissue.

For additional information, see the section titled “T Cell Fusosome Approach” below.

In November 2024, we announced a portfolio prioritization in which we suspended development of SC291 in oncology in the ARDENT study and SC379, our stem-cell derived glial progenitor cell product candidate, in various central nervous system diseases.

Our people are the most important strength of the company.

We have assembled a diverse group of experienced company builders, scientists, manufacturing scientists, engineers, and operators to execute our business plan.

• Experienced Company Builders .

We have numerous individuals with vast experience in building disruptive biotech companies, having expertise in basic research, clinical medicine, finance, company building, and operations.

• Leading Scientists and Drug Developers .

We believe that in order to successfully develop engineered cells as medicines, significant investments in infrastructure and cross-functional capabilities need to be coupled with deep scientific and development expertise in the cell types and diseases of interest within each program.

We have assembled a team with deep expertise in transplant immunology, T cell biology, stem cell biology, type 1 diabetes, basic immunology, autoimmunity, drug discovery, and drug development.

• Experienced Manufacturing Scientists, Engineers, and Operators .

We have assembled manufacturing sciences and operations expertise on our board, on our executive team, and across the company.

• Board and Investors with Shared Long-Term Vision .

Our board of directors is composed of renowned company builders, scientists, drug developers, and investors who share our long-term vision of advancing engineered cells as medicines to change the lives of patients.

Our board of directors is a resource that has enabled our strategy of consolidating technologies, assets, and people to expand the potential impact of our long-term vision.

Our capabilities enable us to take a comprehensive approach to the most important and difficult aspects of engineering cells.

We are pursuing both ex vivo and in vivo cell engineering platforms and can leverage the synergistic proficiencies required to succeed in both approaches.

We believe we can capitalize on the shared expertise and infrastructure between the platforms to maximize the potential success and the reach of each of our potentially transformative therapies.

UP421 is derived from the cells of a deceased donor.

In contrast, SC451 is derived from stem cells and is therefore more amenable to commercial scale.

We have made meaningful progress with SC451 over the past year.

We have completed manufacture of our gene-modified stem cell master cell bank, begun tech transfer of our Phase 1 manufacturing process to our partner contract manufacturers, continued our necessary preclinical tests, and met with regulators in various parts of the world.

We expect to submit an IND for SC451 and begin our Phase 1 trial as early as this year.

With respect to our in vivo cell engineering research efforts, we have advanced from our earlier SG299 in vivo CAR T candidate to an improved next-generation product candidate, SG293, both of which use our proprietary fusogen-based delivery platform.

In January 2026, we shared data from a preclinical study using a surrogate for SG293 that delivers a CD20 CAR capable of targeting non-human primate (NHP) B cells in cynomolgus macaques.

No lymphodepletion was administered to the NHPs in this study.

A single intravenous injection of the SG293 surrogate to these NHPs resulted in robust in vivo generation of CAR T cells and deep B cell depletion in the peripheral blood and lymph nodes.

The B cell depletion was further confirmed by lymph node biopsies showing clearance of B cells as well as by “reset” of the NHPs’ B cell repertoire toward naïve B cells.

We believe that deep B cell depletion in this preclinical model is the most significant biomarker for potential efficacy in patients with B cell cancers and B cell mediated autoimmune diseases.

Separately, in vitro studies using SG293 have shown selective gene delivery to CD8+ T cells with minimal or undetectable off-target transduction in tissues such as the liver and gonadal tissue, supporting the specificity of SG293.

We continue to evaluate SG293 preclinically, and we intend to begin clinical testing and generate early clinical data with SG293 in certain B cell cancers as early as this year.

For additional information, see the section titled “T Cell-Targeted Fusosome Approach” below.

Previously, we were also pursuing programs in the field of HIP-edited ex vivo CAR T therapy.

However, in order to prioritize development of our SC451 and SG293 programs, in November 2025, we announced our decision to suspend development of our allogeneic CAR T programs, including SC291 and SC262, and to halt further enrollment in the Phase 1 GLEAM and VIVID trials of these candidates.

While the allogeneic CAR T programs increased our confidence in our HIP platform, we believe the impact we can have for patients and shareholders is now greater with increased focus on SC451 and SG293.

Our people are the most important strength of the company and our capabilities enable us to take a comprehensive approach to the most important and difficult aspects of engineering cells.

We believe we can capitalize on the shared expertise and infrastructure between our ex vivo and in vivo cell engineering platforms to maximize the potential success and reach of each of our potentially transformative therapies.

We have built significant internal capabilities across a wide range of areas focused on solving the most critical limitations in engineering cells including:

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Developing our platforms into therapies for patients requires a deep understanding of both cell and disease biology.

Furthermore, we are investing significantly in our people and the technologies that enable the differentiation of pluripotent stem cells (PSC) into mature cells that can be used as therapeutics.

Furthermore, we are investing significantly in our people and the technologies that enable the differentiation of pluripotent stem cells (PSCs) into mature cells that can be used as therapeutics.

• Immunology .

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Understanding and harnessing the immune system can have a broad impact across our ex vivo and in vivo cell engineering portfolio.

Our hypoimmune technology, led by a team of transplant immunologists, has the potential to “hide” cells from the immune system, unlocking the potential of allogeneic ex vivo cell therapies for the treatment of numerous diseases We are also investing in our people and technologies to harness the immune system, particularly T cells, for the treatment autoimmune diseases and cancer.

Our hypoimmune technology has the potential to “hide” cells from the immune system, unlocking the potential of allogeneic ex vivo cell therapies for the treatment of numerous diseases We are also investing in our people and technologies to harness the immune system, particularly T cells, for the treatment cancer and autoimmune diseases.

• Genome Modification .

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We believe our delivery technologies have broad potential, with both near-term and long-term applications across a number of indications.

We are investing in technologies that allow payload delivery to specific cell types and increase the diversity of payloads.

We are investing in technologies that allow payload delivery to specific cell types and to increase the diversity of payloads.

Our ex vivo and in vivo Cell Engineering Platforms

The advent of recombinant DNA technology in the 1970s ushered in a new era of therapeutics, enabling the synthetic manufacture of human protein therapies at scale for the first time.

A critical inflection point occurred when key technological advancements eventually enabled the broad development of protein drugs, including monoclonal antibodies with suitable therapeutic properties.

A critical inflection point occurred when key technological advancements eventually enabled the broad development and manufacturing of protein drugs, including monoclonal antibodies with suitable therapeutic properties.

These advancements, combined with progress in understanding disease biology, allowed biologics to become the second largest therapeutic class.

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We are focused on making therapies using PSCs with our hypoimmune genetic modifications as the starting material, which we then differentiate into a specific cell type, such as a pancreatic islet cell, before treating the patient.

Additionally, there are cell types for which effective differentiation protocols from a stem cell have not yet been developed, such as T cells.

For such cell types, instead of starting from a PSC, we can use a fully differentiated allogeneic cell, sourced from a donor, as the starting material to which we then apply our hypoimmune genetic modifications.

Our goal is to manufacture genetically modified cells that are capable of both replacing the missing cell and evading the patient’s immune system.

We are now applying our ex vivo cell engineering technologies to make cell products for the treatment of multiple diseases.

While SC451 is our primary ex vivo candidate, we intend to apply our ex vivo cell engineering technologies to make cell products for the treatment of multiple diseases.

In vivo Cell Engineering

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Our goal for in vivo cell engineering is to repair and control the genes of any cell in the body.

The ultimate aim is to achieve the delivery of any payload, to any cell, in a specific and repeatable way.

The ultimate aim is to achieve delivery of any payload, to any cell, in a specific and repeatable way.

We believe that progress in any of these categories can allow us to make important medicines.

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• prioritize efforts where success in one area begets success in others.

We are developing a broad pipeline of clinical product candidates focused on creating transformative ex vivo and in vivo therapies across a range of therapeutic areas.

We are in the early stages of development across a broad pipeline of product candidates, which are summarized below:

1 Investigator sponsored trial.

Abbreviations:

AAV, ANCA-associated vasculitis;

NHL, non-Hodgkin’s lymphoma;

SLE, systemic lupus erythematosus;

T1D, type 1 diabetes;

WW, worldwide.

We are currently focused on advancing our pipeline across two platforms for the treatment of various significant disease types, including type 1 diabetes, B cell cancers, and B cell mediated autoimmune diseases.

We retain worldwide rights to each of the product candidates described below.

Each of our programs provides the potential for meaningful standalone value while also supporting our potential ability to further exploit our platforms in a manner that leads to the development of broadly applicable medicines.

PSC-derived Pancreatic Islet Cells

SC451 is our PSC-derived hypoimmune pancreatic islet cell product candidate for the treatment of diabetes, with an initial focus on T1D.

More than nine million patients worldwide have T1D, a disease in which a patient’s immune system attacks and kills pancreatic beta cells, leading to complete loss of insulin production in affected individuals.

These patients represent a small fraction of the overall global diabetes population, which is estimated to be approximately 540 million.

T1D patients typically need to take multiple insulin injections every day for life.

iPSC-derived HIP Pancreatic Islet Cells

SC451 is our induced PSC (iPSC)-derived hypoimmune pancreatic islet cell product candidate for the treatment of diabetes, with an initial focus on T1D.

Almost ten million patients worldwide have T1D, a disease in which a patient’s immune system attacks and kills pancreatic beta cells, leading to complete loss of insulin production in affected individuals.

T1D patients typically need to take multiple insulin injections and monitor their blood glucose every day for life.

Although the introduction of insulin has had a profoundly positive impact on patients and there has been significant improvement in convenience for patients over the past several decades with the introduction of insulin pumps and continuous glucose monitors, people with T1D have approximately 15 years shorter life expectancies than people without diabetes and are consistently at risk for complications such as coma, stroke, myocardial infarction, kidney failure, and blindness from poorly-controlled blood glucose.

Even for patients with access to state-of-the-art medical care and who are able to tightly control blood glucose through access to automated insulin delivery systems, life expectancy is approximately a decade shorter than for those without the disease.

Previous results from others have shown that either primary or PSC-derived pancreatic islets, when given with significant immunosuppression, can allow patients to control blood glucose without the need for insulin therapy.

Based on our human clinical data and preclinical HIP data, we believe that our HIP-modified pancreatic islets should achieve the same outcome without the risks of immunosuppression.

We have shown that we can develop high-quality stem cell-derived islet cells that, when transplanted in animal models, normalize blood glucose and cure diabetes.

We have also shown that our hypoimmune cells induce no systemic immune response, survive, and function in a patient with T1D.

We are combining these capabilities and learnings into SC451, and we plan to submit an IND as early as 2026.

The UP421 IST has shown that our hypoimmune cells induce no systemic immune response, survive, and function in a person with T1D.

We are combining these capabilities and learnings into SC451 in a single product candidate that is derived from an O-negative, GMP-compliant iPSC master cell line.

These human data are supported by preclinical data in several models, including in NHPs with a pre-existing immune response to non-hypoimmune cells and in a diabetic NHP, where allogeneic, HIP-modified NHP pancreatic islet cells survive and function for the duration of our NHP studies, the longest of which is about forty weeks.

To demonstrate applicability in the context of the autoimmunity seen in people with T1D, we have developed a proprietary mouse model in-house with human immune cells from a T1D patient.

In this model, we showed that HIP modifications enabled stem cell-derived pancreatic islet cells derived from a patient with T1D to evade both the autoimmune and allogeneic immune response, survive, and function for the duration of the study.

T1D is a disease of missing pancreatic beta cells.

Previous results from others have shown that either primary or PSC-derived pancreatic islets, which given with significant immunosuppression, can allow patients to control blood glucose without the need for insulin therapy.

Our human clinical data and our preclinical HIP data support that our HIP-modified pancreatic islets can evade immune detection and potentially eliminate immunosuppression for patients treated with HIP-modified, PSC-derived pancreatic islets.

We believe our HIP-modified, PSC-derived pancreatic islets have the potential to create a disruptive treatment for T1D, offering patients life-long normal blood glucose without immunosuppression.

To demonstrate applicability in the context of the autoimmunity seen in people with T1D, we developed a proprietary mouse model in-house with human immune cells from a T1D patient.

In this model, we showed that HIP modifications enabled stem cell-derived pancreatic islet cells derived from a patient with T1D to evade the autoimmune immune response, survive, and function for the duration of the study.

Combined, we believe that these studies preclinically validate that our HIP technology can allow transplanted cells to evade both the allogeneic rejection typical with transplantation as well as the autoimmune rejection typical of T1D.

We believe our HIP-modified, iPSC-derived pancreatic islets have the potential to create a disruptive treatment for T1D, offering patients long-term normal blood glucose without immunosuppression.

We plan to submit an IND and begin our Phase 1 clinical study as early as this year.

HIP Primary Islet Cells

UP421 is a HIP-modified allogeneic primary islet cell product that was first transplanted, with no concomitant immunosuppression, into a patient with T1D in December 2024 in an IST being conducted at Uppsala University Hospital.

UP421 is a HIP-modified allogeneic primary islet cell therapy that was first transplanted, with no concomitant immunosuppression, into a patient with T1D in December 2024 in an IST being conducted at Uppsala University Hospital.

This Phase 1 trial has a primary endpoint of safety and also evaluates secondary endpoints, including survival and function of the islet cells.

The safety data, secondary endpoints, dosing rationale, clinical outcomes, and immune analysis from the first treated patient are summarized above under the section titled “Overview.” The study is ongoing and continues to evaluate safety, persistence, and function of the transplanted cells.

Allogeneic T Cell Platform

We are applying our hypoimmune technology to donor-derived T cells to develop allogeneic cell therapies for B cell mediated autoimmune diseases and B cell malignancies.

These programs are designed to address a major limitation of existing allogeneic CAR T cell therapies:

the need to evade host versus graft responses (HvGR) that occur when a patient’s immune system kills the transplanted T cells, limiting the potential benefit of the therapy.

The rapid killing of the transplanted cells may be a major contributor to the short-lived responses seen in patients treated with allogeneic CAR T cells.

One approach to avoid HvGR has been to effectively eliminate a patient’s immune system for a short period using chemotherapy, which puts the patient at risk for severe infections.

Further, the patient’s suppressed immune system inevitably recovers and eliminates the CAR T cells, limiting the effectiveness of the therapy.

Our hypoimmune technology is designed to enable cells to “hide” from the patient’s immune system, giving our allogeneic CAR T cell platform the potential to create medicines that persist longer in patients and avoid the risks associated with higher doses of chemotherapy.

SC291 is being evaluated in patients with LN, ERL, and ANCA-associated vasculitis in a Phase 1 dose escalation study that we refer to as our GLEAM trial.

Patients are currently being enrolled and dosed in this study and we expect to share data in 2025.

B cell depleting therapies, such as anti-CD20 antibodies (e.g., rituximab), have shown clinical benefit in the treatment of multiple autoimmune disorders that involve production of autoimmune antibodies, including LN, ERL, ANCA-associated vasculitis, and many others.

The rituximab trials in SLE afforded the key insight that the depth of B cell depletion was associated with improved patient responses.

Although these antibodies are adept at depleting B cells in circulation for many patients, they are unable to penetrate deeply into the germinal centers of the lymph node and tissues, where the pathogenic B cells continue to survive and drive disease.

CD19-directed CAR T cells are known to cause deep B cell depletion in CAR T therapy recipients.

Georg Schett and his research group in Erlangen, Germany tested the treatment of refractory SLE patients with autologous CD19-directed CAR T cells and were successful in inducing long-lasting drug-free remissions for these patients.

In our ARDENT trial, we observed the pharmacodynamic effect of peripheral blood B cell depletion, which refers to diminishing B cell counts in the peripheral blood, associated with SC291 treatment in patients.

Although pharmacodynamic effects seen in oncology patients may not translate to patients with autoimmune disease, we believe these data increase the probability that SC291 treatment will confer similar B cell depletion, the putative mechanism of benefit, to patients with B cell mediated autoimmune diseases.

SC291 also provides the benefit of being available “off the shelf,” avoiding the complex management of patients with respect to the apheresis procedure for cell harvest and between cell harvest and infusion required for treatment with autologous CAR T products, while also providing the potential for increased manufacturing scalability.

We are developing SC262, our hypoimmune-modified CD22-directed allogeneic CAR T program, initially as a potential treatment for patients with relapsed and/or refractory B cell malignancies who have received prior CD19-directed CAR T therapy in NHL.

In January 2024, the FDA cleared our IND to evaluate SC262 in this patient population in a Phase 1 clinical study that we refer to as our VIVID trial.

We are enrolling patients in this trial and expect to share data in 2025.

The CD22-directed CAR construct that we use in SC262, which we licensed from the National Institutes of Health, has already been evaluated in multiple academic clinical trials of autologous CAR T cell therapies, data from which have shown complete responses (CR) in a substantial number of patients that have relapsed following treatment with a CD19-directed CAR T therapy.

For example, data from a Phase 1 trial (n=38) of NHL patients conducted at Stanford University, where 97% of patients were either refractory and/or relapsed after prior CD19-directed CAR T therapy, demonstrated a CR rate of 53% and an overall response rate (ORR) of 68%.

Seventy-five percent of the CRs lasted 12 months or longer.

Our allogeneic T cell platform is designed to enable the substitution of CAR constructs in a modular fashion.

For the near-term, we are prioritizing clinically validated targets as well as CAR constructs, such as our CD19-targeted CAR, that have shown promising safety and efficacy profiles in the autologous context.

In the future, additional candidates may be nominated to address various diseases, such as autoimmune diseases, hematological malignancies, and solid tumors.

The safety data, secondary endpoints, dosing rationale, clinical outcomes, and immune analysis from the treated patient are discussed below in the section titled “Pancreatic Islet Cell Program.”

In vivo CD19-Directed CAR T Cells

Our most advanced CAR T cell fusosome product candidate is SG299, a CD8-targeted fusosome that delivers a CD19-directed CAR to target CD19+ cells.

We are developing SG299 to treat patients with hematologic malignancies and B cell mediated autoimmune diseases.

Our in vivo platform provides an opportunity to develop potential product candidates that can expand access to CAR T cell therapy to patients in need.

The effectiveness of ex vivo -manufactured CAR T cells currently depends on the administration of a lymphodepleting preparative regimen prior to infusion to facilitate expansion of the CAR T cell product, which can have an adverse impact on safety.

We do not expect to need a lymphodepleting regimen prior to in vivo delivery of the CAR gene via fusosome, as our goal is to expose our fusosomes to as many T cells in the body as possible.

We also believe the ability to deliver a payload encoding a CAR to a T cell without significant ex vivo manipulation has the potential to be more effective than ex vivo -manufactured CAR T cell products, generating therapeutically active CAR T cells without the complexities and delays associated with the processes of T cell collection and ex vivo manufacturing that are used in currently approved autologous CAR T cell products.

Our in vivo CAR T pipeline has advanced beyond our earlier constructs, such as SG299, to our next-generation product candidate, SG293, which leverages our proprietary fusogen delivery platform to enable direct, in-patient generation of CAR T cells.

SG293 uses a CD8-targeted fusogen to deliver a CD19-directed CAR to CD8+ T cells in vivo and is being developed for the treatment of B cell cancers and B cell mediated autoimmune diseases.

The goal of our in vivo CAR T platform is to expand the CAR T therapy access to patients and improve the overall safety profile of this therapy while maintaining or improving the efficacy of ex vivo- manufactured, autologous CAR T cell therapies.

As an example, the effectiveness of ex vivo -manufactured CAR T cells currently depends on the administration of a lymphodepleting chemotherapy preparative regimen prior to infusion to facilitate expansion of the CAR T cell product post-infusion, and this chemotherapy often has an adverse safety impact.

We do not expect to need a lymphodepleting regimen prior to in vivo delivery of the CAR gene via fusosome, and in fact believe that it would be detrimental to our goal of exposing our fusosomes to as many T cells in the body as possible.

We also believe the ability to deliver a payload encoding a CAR to a T cell without significant ex vivo manipulation has the potential to be more effective and potent than ex vivo -manufactured CAR T cell products, generating therapeutically active CAR T cells without the complexities and delays associated with the processes of T cell collection and ex vivo manufacturing that are used in currently approved autologous CAR T cell products.

Furthermore, the ex vivo expansion of cells in the presence of high cytokine concentrations, although necessary for the manufacture of currently approved CAR T cell products, also contributes to marked changes in T cell quality that may not be therapeutically beneficial.

The generation of a CAR T cell within the natural physiological environment in vivo has the potential to improve the quality of the CAR T cell generated, potentially improving both efficacy and the side effect profile We anticipate submitting an IND for SG299 as early as 2026.

We expect to generate initial human data with SG293 as early as this year.

Our ex vivo Cell Engineering Platform

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• Stem cell and disease biology .

We believe that it is critical to have expertise in the developmental biology of stem cell differentiation and a deep understanding of the desired cell biology of stem cell differentiation in order to generate cells that function appropriately, as well as a deep understanding of the desired cell phenotype.

We believe that it is critical to have expertise in the developmental biology of stem cell differentiation and a deep understanding of the desired cell biology of stem cell differentiation to generate cells that function appropriately, as well as a deep understanding of the desired cell phenotype.

The latter requires expertise in normal and disease biology.

Furthermore, clinical understanding of disease pathology and transplant medicine is required to determine how to engraft the right cell in the right environment.

Each of our programs is led by a prominent clinician-scientist with deep expertise in both cell therapy and disease biology.

• Immunology and genome modification .

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We have also built gene editing, genome modification, and gene insertion capabilities in order to modify the genome of cells so that transplanted, allogeneic cells can evade immune detection.

We are also investing to obtain, manufacture, and ensure access to high quality current good manufacturing practice (GMP)-grade PSC lines for our programs.

• Manufacturing .

We are investing proactively in process development, including process optimization and scale up, analytical development, CMC regulatory, supply chain, quality, and other manufacturing sciences in order to develop processes that can enable scalable manufacturing of cell therapies and broad patient access.

We are investing in process development, including process optimization and scale up, analytical development, CMC regulatory, supply chain, quality, and other manufacturing sciences in order to develop processes that enable scalable manufacturing of cell therapies and broad patient access.

We have entered into agreements with contract development and manufacturing organizations (CDMOs) and other partners for access to facilities and reagents in our supply chain necessary to manufacture our product candidates.

We have built a pilot manufacturing plant in South San Francisco, California and entered into a long-term lease agreement for a manufacturing facility in Bothell, Washington.

We are also investing to obtain and ensure access to high quality donor-derived T cells and current good manufacturing practice (GMP)-grade PSC lines for our programs.

We will continue to invest in our manufacturing capabilities to ensure our pipeline needs are met.

We have prioritized cell types for our programs when:

We plan to continue investing in our manufacturing capabilities to ensure our pipeline needs are met.

We have prioritized cell types for our programs where:

• high unmet need can be addressed by cell replacement;

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• there has been the ability to hire or partner with world experts in the field to ensure our programs are rooted in a deep understanding of the underlying cell and disease biology;

• evading immune system rejection via the hypoimmune technology is either not required initially or is the critical missing element to developing a cell therapy (such as pancreatic islet cells).

Based on this prioritization, we are currently focused on two cell types:

pancreatic islet cells and T cells.

• evading immune system rejection via our hypoimmune technology is a critical missing element to developing an impactful cell therapy.

Based on this prioritization, we are currently focused on pancreatic islet cells.

Historical Context of ex vivo Therapy

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The first successful kidney transplant occurred in 1954, followed by the first successful heart transplant in 1967, demonstrating the transformative clinical potential of replacing damaged or missing cells in the body.

Surgical enhancements have improved the success of engraftment, but lack of organ access, complex surgical procedures, and immune rejection of the donated organs have limited the impact of these procedures.

Surgical enhancements have improved the success of engraftment, but lack of organ access, complex surgical procedures, immune rejection of the donated organs, and side effects from immunosuppressive regimens have limited the impact of these procedures beyond blood transfusions.

Host versus graft reaction (HvGR) is an effectively universal reaction whereby the immune system of an organ or cell transplant recipient recognizes the donor tissue as foreign and attacks it, leading to transplant rejection.

Progress in immunosuppressive regimens, such as the development of cyclosporine, has improved organ survival rates.

However, substantial side effects and the fact that many patients are ineligible or non-compliant have reduced their impact.

Ultimately, the field has looked for a scalable source of therapeutic cells that can be accessed broadly at a manageable cost, as well as cells that can evade immune rejection without immunosuppression.

However, substantial side effects and the fact that many patients are ineligible or non-compliant have reduced the impact of these regimens.

Ultimately, the field has looked for a scalable source of therapeutic cells that can be accessed broadly at a manageable cost and that can evade immune rejection without immunosuppression.

The advent of stem cell technology and subsequent improvements in methods to generate functional differentiated cells at scale have the potential to address the shortage of donor tissues and organs.

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There are three main potential sources of allogeneic cells, or cells that do not originate from the patient, and therefore have the potential to be manufactured and supplied at scale.

These are embryonic stem cells (ESCs), induced pluripotent stem cells (iPSCs), and donor-derived cells.

Our portfolio currently includes a mix of sources.

These are embryonic stem cells (ESCs), iPSCs, and donor-derived cells.

Our portfolio currently focuses on cells derived from iPSCs.

Crucial aspects of developing allogeneic cells from any source include a thorough characterization of the cells, a comprehensive understanding of the global regulatory environment, and an ability to maintain cells under the required conditions, such as GMP, at various stages of the manufacturing processes.

We believe our early investment in building capabilities in the science and manufacturing of these cells will increase our likelihood of success.

This investment is intended to yield sources of cells suitable for the global clinical development and commercialization of ex vivo engineered cells for a broad patient population, in line with our vision to democratize access.

This investment is intended to yield sources of cells suitable for the global clinical development and commercialization of ex vivo engineered cells for a broad patient population.

Embryonic Stem Cells

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ESCs are PSCs that have the potential to differentiate into any cell type and are derived from the inner cell mass of a blastocyst or pre-implantation stage embryo.

They are typically cultured in vitro and grown through cycles of cell division, known as passages, until a line of cells is established that can proliferate without differentiating, and retain their pluripotency while remaining well characterized, including being free of potentially deleterious genetic mutations.

They are typically cultured in vitro and grown through cycles of cell division, known as passages, until a line of cells is established that can proliferate without differentiating and retain pluripotency while remaining well characterized, including being free of potentially deleterious genetic mutations.

Because PSCs can divide indefinitely without exhaustion, an ESC line can be used to generate cell banks, consisting of large numbers of well-characterized vials of cells, that can be frozen and stored for future use.

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The discovery that mature, differentiated cells can be reprogrammed to be the equivalent of an ESC and capable of generating any cell type in the body has led to the research and ultimate development of human iPSCs, providing an alternative option as a source of stem cells for use in ex vivo engineered cells.

A key breakthrough in 2006 demonstrated that mature cells could be reprogrammed via the expression of a small number of genes to result in pluripotent cells.

These iPSCs have similar potential to ESCs to be used as an indefinitely renewable cell bank for manufacturing of cell-based therapies.

A key breakthrough in 2006 demonstrated that mature cells could be reprogrammed via the expression of a small number of genes to result in pluripotent stem cells.

These iPSCs, which we use in SC451, have similar potential to ESCs to be used as an indefinitely renewable cell bank for manufacturing of cell-based therapies.

Donor-Derived Allogeneic Cells

Another source of cells, which we use in our T cell programs, comes from mature donor-derived allogeneic cells.

Although these T cells are neither pluripotent nor from an infinitely renewable source, they can be obtained as mature cells from human donors at scale.

The use of donor-derived cells for our T cell platform may enable us to more rapidly advance product candidates towards the clinic with the implementation of our hypoimmune technology.

Another source of cells, which we use in UP421, comes from mature donor-derived allogeneic cells.

These cells are neither pluripotent nor from an infinitely renewable source, but are instead obtained as mature cells from human donors.

Background on Immunological Barriers to ex vivo Therapies and Current Limitations

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Although this approach can reduce the adaptive immune response to donor cells, the human immune system has evolved so that parts of the innate immune system will recognize cells missing MHC molecules and eliminate them.

For example, NK cells express receptors known as inhibitory killer-cell immunoglobulin-like receptors (inhibitory KIRs).

For example, NK cells express receptors known as inhibitory killer-cell immunoglobulin-like receptors (KIRs).

KIRs recognize self MHC class I molecules on the surface of cells and provide inhibitory signals to the NK cells to prevent their activation.

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• Immune Suppression .

Cyclosporine and other molecules that suppress T cell responses are commonly used, and many patients have been helped by these approaches in areas such as an organ transplantation.

Cyclosporine and other molecules that suppress T cell responses are commonly used, and many patients have been helped by these approaches in areas such as organ transplantation.

However, immune suppression often leads to significant systemic side effects, including a decreased ability to resist infections, increased susceptibility to cancer, and a wide variety of organ toxicities.

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To address the challenge of immune rejection with allogeneic cell transplantation, we are developing our hypoimmune technology, which uses genome modification to introduce permanent changes to the cells.

We are applying the hypoimmune technology to PSCs, which can then be differentiated into multiple cell types, and to donor-derived allogeneic T cells, with the goal of making potent CAR T cells at scale and transplanting allogeneic cells into patients without the need for systemic and prolonged immune suppression.

We believe that enabling this capability has the potential to enable ex vivo engineered cells to become an important therapeutic modality alongside small molecules, protein biologics, and in vivo engineered cells.

Some of our scientific founders and their collaborators have worked on creating hypoimmune cells for well over a decade.

A key insight that informed their work is the phenomenon of fetomaternal tolerance during pregnancy.

We are currently focused on applying the hypoimmune technology to iPSCs, which can then be differentiated into multiple cell types.

We believe that enabling this capability has the potential to enable ex vivo engineered cells to become an important therapeutic modality.

Some of our scientific founders and their collaborators have worked on creating hypoimmune cells for almost two decades.

A key insight that informed their work is the phenomenon of feto-maternal tolerance during pregnancy.

The fetus, despite having half its genetic material from the father, is not rejected by the mother’s immune system.

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Our goal is to create a universal cell capable of evading immune detection, regardless of cell type or transplant location.

Our current clinical hypoimmune technology, which is being used in our SC291 and SC262 product candidates, combines three genome modifications to “hide” these cells from the host immune system:

Our hypoimmune technology combines three genome modifications to “hide” these cells from the host immune system:

• disruption of MHC class I expression;

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Creating Hypoimmune Therapeutic Cells from Human iPSCs

Our current clinical hypoimmune technology combines the following three gene modifications to “hide” cells from the host immune system:

Our hypoimmune technology combines the following three gene modifications to “hide” cells from the host immune system:

disruption of MHC class I and class II expression (which inactivates adaptive immune responses), and overexpression of CD47 (which “hides” cells from the innate immune system, including macrophages and NK) cells.

PSCs from healthy donors are used as the starting material and are then genetically modified with the hypoimmune modifications.

iPSCs from healthy donors are used as the starting material and are then genetically modified with our hypoimmune modifications.

These edited cells are then differentiated into cell types of therapeutic interest, which could potentially be administered to a patient as an “off the shelf” therapy.

Preclinical Development of Hypoimmune Cells

We and our licensors have carried out a series of experiments in various model systems of increasing immunological complexity.

These included (i) transplanting undifferentiated mouse hypoimmune iPSCs into MHC mismatched allogeneic mice, (ii) transplanting mouse hypoimmune iPSC-derived differentiated cells, such as endothelial cells, into MHC mismatched allogeneic mice, (iii) transplanting human hypoimmune iPSCs into MHC mismatched humanized allogeneic mice, (iv) transplanting NHP hypoimmune iPSCs into MHC mismatched allogeneic NHPs, (v) transplanting NHP hypoimmune iPSC-derived differentiated cells, such as cardiomyocytes or retinal pigment epithelial cells (RPEs), into MHC mismatched allogeneic NHPs, and (vi) transplanting NHP hypoimmune primary cells, such as islets, into MHC mismatched diabetic and non-diabetic NHPs.

Over time, we and our licensors have carried out a series of experiments in various model systems of increasing immunological complexity.

These included (i) transplanting undifferentiated mouse hypoimmune iPSCs into MHC mismatched allogeneic mice, (ii) transplanting mouse hypoimmune iPSC-derived differentiated cells, such as pancreatic islet cells, into MHC mismatched allogeneic mice, (iii) transplanting human hypoimmune iPSCs into MHC mismatched humanized allogeneic mice, (iv) transplanting NHP hypoimmune iPSCs into MHC mismatched allogeneic NHPs, (v) transplanting NHP hypoimmune iPSC-derived differentiated cells, such as cardiomyocytes or retinal pigment epithelial cells (RPEs), into MHC mismatched allogeneic NHPs, and (vi) transplanting NHP hypoimmune primary cells, such as pancreatic islets, into MHC mismatched diabetic and non-diabetic NHPs.

We have shown that HIP-modified cells survive and evade immune detection in each of these settings.

Importantly, these results include experiments in NHPs, including testing of hypoimmune primary islets.

We have shown that hypoimmune primary islets can mediate insulin independence in a fully immunocompetent diabetic NHP without immunosuppression.

We have shown that hypoimmune primary islets can mediate insulin independence in a fully immunocompetent diabetic NHP without the use of any immunosuppression.

These results confirm that hypoimmune modifications confer immune evasion without compromising islet function in this setting.

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It was observed that the human hypoimmune cells survived the full length of the experiment and failed to elicit any type of immune response.

From this data we concluded that in humanized mice, human hypoimmune cells can evade the immune system.

From these data we concluded that in humanized mice, human hypoimmune cells can evade the immune system.

Pluripotency of human hypoimmune cells was confirmed by differentiation into two different cell types, endothelial cells and cardiomyocytes, which exhibited the characteristics of normal endothelial cells and cardiomyocytes.

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In contrast, differentiated cells derived from unmodified human iPSC cells did not survive after being transplanted, as anticipated.

It was also observed that the hypoimmune endothelial cells formed primitive vasculature with active blood flow, and the hypoimmune cardiomyocyte cells matured into functional-looking heart cells.

NHP Hypoimmune Cells Transplanted into NHPs

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Notably, these unmodified iPSCs were rapidly rejected by the NHP within one to two weeks, while the previously injected hypoimmune iPSCs continued to be viable in the other leg of the NHP.

These results confirm that the survival of the hypoimmune allo-graft was not an artifact of an impaired immune system or immune response in the recipient NHP.

They also suggest that these hypoimmune iPSCs have the potential for immune evasion even the context of a new immune response toward iPSCs without these edits.

These results confirm that the survival of the hypoimmune allograft was not an artifact of an impaired immune system or immune response in the recipient NHP.

They also suggest that these hypoimmune iPSCs have the potential for immune evasion even in the context of a new immune response toward iPSCs without these edits.

In other experiments, we observed immune evasion and cell survival of hypoimmune NHP iPSC-derived cardiomyocytes and RPEs.

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For these experiments, we made hypoimmune genetic modifications to NHP primary islets and then transplanted these islets intramuscularly, without immunosuppression, into a different NHP.

We found that the hypoimmune islets were viable for the full duration of the study (approximately 10 months) and did not elicit either an adaptive or innate immune response.

We found that the hypoimmune islets were viable for the full duration of the study (approximately ten months) and did not elicit either an adaptive or innate immune response.

By contrast, unmodified NHP primary islets injected into a separate NHP were rejected within one week.

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Data published in Hu et al., Nat Biotechnology 2024 Mar;42(3):413-423.

In January 2024, we presented data from a study transplanting allogeneic HIP-modified pancreatic islet cells into a fully immunocompetent, diabetic NHP.

We have also presented data from a study transplanting allogeneic HIP-modified pancreatic islet cells into a fully immunocompetent, diabetic NHP.

Subsequent to diabetes being induced in the NHP with streptozotocin (STZ), daily insulin injections were performed to re-establish glucose control.

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HIP primary islets showed no T cell recognition, no graft-specific antibodies, and were protected from NK cell and macrophage killing.

To demonstrate that the NHP’s insulin-independence was fully dependent on the HIP primary islets and that there was no regeneration of the animal’s endogenous islet cell population, we triggered the destruction of the HIP primary islets using a CD47-targeting antibody.

This resulted in a loss of glycemic control and return to exogenous insulin dependence.

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Blood glucose was monitored twice daily and showed major instability over approximately two weeks until a well-controlled steady state was reached.

After 78 days, the NHP was underwent intramuscular transplantation with allogeneic HIP islet cells.

After 78 days, the NHP underwent intramuscular transplantation with allogeneic HIP islet cells.

Insulin support was gradually withdrawn over approximately 12 days.

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Based on our preclinical data to date, we believe our hypoimmune technology has the potential to address the most fundamental limitation of ex vivo therapies, persistence, and thereby unlock waves of potentially disruptive therapies across a variety of cell types.

The preliminary clinical findings from the first-in-human transplantation of UP421, our HIP-modified allogeneic primary islet cell product, in the IST being conducted at Uppsala University Hospital further validate our preclinical observations.

These initial human data demonstrate that HIP-modified islet cells can survive and function without immunosuppression.

The findings from the first-in-human transplantation of UP421, our HIP-modified allogeneic primary islet cell therapy, in the IST being conducted at Uppsala University Hospital further validate our preclinical observations.

These human data demonstrate that HIP-modified islet cells can survive and function without immunosuppression.

The detection of C-peptide production and comprehensive immune evasion in the IST represents a significant step toward addressing the fundamental challenge of cellular persistence in transplantation therapies.

The preliminary results from the IST are described in greater detail below in the section titled “Pancreatic Islet Cell Program.”

The results from the IST are described in greater detail below in the section titled “Pancreatic Islet Cell Program.”

Safety Switch for Hypoimmune Cells

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We believe these data support use of anti-CD47 antibodies as a potential safety strategy.

We have identified several additional safety switches with both in vitro and in vivo activity and will include one of these in SC451 to provide another mechanism to kill these cells if needed.

We have identified several additional safety switches with both in vitro and in vivo activity and intend to include one of these in SC451 to provide a mechanism to kill these cells if needed.

Anti-CD47 Administration Results in the Rapid Clearance of Hypoimmune NHP iPSCs in vitro

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Pancreatic Islet Cell Program

SC451 is our hypoimmune PSC-derived pancreatic islet cell product candidate that aims to restore glucose control in patients with T1D patients by transplantation into these patients without the need for immunosuppression.

SC451 is our hypoimmune iPSC-derived pancreatic islet cell product candidate that aims to restore glucose control in patients with T1D patients by transplantation into these patients without the need for immunosuppression.

T1D is a disease of missing pancreatic beta cells, and we believe that transplanting pancreatic islets, which are composed of pancreatic alpha, beta, and delta cells, offers the chance for patients to have normal blood glucose control without insulin, meaningfully improving outcomes for patients with T1D.

Over 20 years of global clinical experience transplanting allogeneic primary pancreatic islets from cadavers support this belief.

Over 20 years of global clinical experience transplanting allogeneic primary pancreatic islets from deceased donors support this belief.

After transplant with significant immunosuppression, T1D patients can remain off insulin with well controlled blood glucose for well over a decade.

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Because there are relatively few patients for whom long-term immunosuppression is better than insulin, we believe that creating a hypoimmune product, removing the need for immunosuppression, is the key next step in creating a curative and broadly available therapy for patients with T1D.

In December 2024, the first-in-human transplantation of UP421, our HIP-modified allogeneic primary islet cell product, occurred at Uppsala University Hospital in a Phase 1 investigator-sponsored trial (IST).

In December 2024, the first-in-human transplantation of UP421, our HIP-modified allogeneic primary islet cell therapy, occurred in an investigator-sponsored trial (IST) conducted at Uppsala University Hospital.

The IST is designed to evaluate safety, immune evasion, and function of UP421 transplanted intramuscularly without any immunosuppression in a patient with T1D.

Four week and preliminary twelve-week clinical data demonstrate that all primary and secondary endpoints were met.

This patient has now been followed for 52 weeks, and data demonstrate that all primary and secondary endpoints have been met throughout the study to twelve months.

The study showed no drug product-related adverse events.

Additionally, there was evidence of graft survival by MRI as well as graft survival and function with detectable C-peptide production.

Additionally, there was evidence of graft survival and function with PET/MRI as well as with detectable C-peptide production throughout the study to twelve months.

C-peptide levels increased, as expected, during a mixed meal tolerance test, showing appropriate function of the transplanted islet cells.

Immunological analysis revealed comprehensive immune evasion of HIP-modified pancreatic islet cells.

The four-week results and preliminary 12-week results are described in greater detail below.

Data from the study are described in greater detail below.

Background on Type 1 Diabetes Mellitus

T1D is an autoimmune disease in which the patient’s immune system destroys its own pancreatic islet cells.

T1D is an autoimmune disease in which the patient’s immune system destroys its own pancreatic beta cells.

The destruction of these cells leads to complete loss of insulin production and a metabolic disease wherein patients are unable to control their blood glucose levels.

Often called “juvenile diabetes,” T1D disease onset commonly occurs in adolescence.

Often called “juvenile diabetes,” T1D disease onset commonly occurs in adolescence, but can occur throughout life.

Beta cells reside in specialized hormone-producing clusters within the pancreas called the islets of Langerhans.

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Without insulin therapy, T1D is rapidly fatal.

T1D currently affects approximately nine million patients worldwide.

These patients represent a small fraction of the overall global diabetes population, which is estimated to be approximately 540 million.

T1D currently affects almost ten million patients worldwide.

Current Treatment Landscape and Unmet Need

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Despite significant advances in types of insulins, glucose monitoring, and insulin pumps, life expectancy for T1D is still approximately 15 years shorter than for people without diabetes.

Patients are at risk of acute complications of hyperglycemia, including diabetic ketoacidosis, coma, and death, as well as hypoglycemic episodes, particularly at night, which can lead to the “dead in bed” syndrome, thought to result from cardiac arrhythmias induced by low glucose.

The significant swings in blood glucose with exogenous insulin make it difficult for a T1D patient to keep blood glucose in physiologic ranges, with blood glucose levels often above target.

Long term elevations in blood glucose levels can have particularly devastating effects on arteries and capillaries, resulting in premature myocardial infarction, stroke, limb ischemia, gangrene, kidney failure, and blindness due to diabetic retinopathy.

“Insulin pumps,” which feature a computerized system for sensing blood glucose and delivering appropriate doses of insulin, have improved glycemic control, though data from the FDA indicate that issues with insulin pumps are among the most frequently reported problems in their database.

All current therapies require patients to carefully monitor their dietary intake, which, although inconvenient in adults, is a frequent point of failure in adolescents.

Pancreas transplantation for uncontrollable diabetes was first performed in the 1960s and established the principle that replacing the beta cells (here, in the context of the entire pancreas) could restore physiological glucose control.

Automated insulin delivery systems, which feature a computerized system for sensing blood glucose and delivering appropriate doses of insulin, have improved glycemic control, but most patients continue to spend significant periods outside of target blood glucose ranges.

Even with the current best treatments and careful glucose control, patients with T1D live an estimated decade shorter than those without the disease.

All current therapies require patients to carefully monitor their dietary intake, which, although inconvenient in adults, is a frequent point of failure in adolescents and children.

Pancreas transplantation for uncontrollable diabetes was first performed in the 1960s and established the principle that replacing the pancreatic beta cells (here, in the context of the entire pancreas) could restore physiological glucose control.

Pancreas transplants are complicated surgical interventions, require lifelong immunosuppression, and are limited due to organ availability.

Nevertheless, some 30,000 pancreas transplants have been performed worldwide to date.

Because of these challenges, the biomedical community began exploring pancreatic islet transplantation in the 1970s.

Because of these challenges, the medical community began exploring pancreatic islet transplantation in the 1970s.

This process requires enzymatic digestion of a donor pancreas and isolation of the islets of Langerhans, followed by delivery of these cells to an appropriate site in the body where the islets can engraft and become well-vascularized.

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Our Pancreatic Islet Cell Program Approach

The goal of our SC451 program is to restore glucose control in T1D patients by transplanting hypoimmune PSC-derived islet cells, including beta cells, without the need for immunosuppression, giving patients physiologically appropriate glucose sensing and insulin secretion.

The goal of our SC451 program is to restore glucose control in T1D patients by transplanting hypoimmune iPSC-derived islet cells, including beta cells, without the need for immunosuppression, giving patients physiologically appropriate glucose sensing and insulin secretion.

We believe this therapy could reduce, or even eliminate, hypoglycemia and hyperglycemia in T1D patients, potentially enabling less onerous and costly treatment, fewer complications, a meaningfully improved quality of life, and longer life expectancy.

We focus our efforts around three goals:

(i) deriving highly functional islet cells from PSCs, (ii) using our hypoimmune technology to genetically modify these cells to evade allogeneic immune responses, and (iii) using our hypoimmune technology to genetically modify these cells to evade autoimmune destruction of islet cells.

(i) using our hypoimmune technology to genetically modify iPSCs to evade allogeneic immune responses, (ii) using our hypoimmune technology to genetically modify iPSCs to evade autoimmune destruction of islet cells, and (iii) deriving highly functional islet cells from these genetically-modified iPSCs.

This strategy requires building on lessons from pancreatic islet transplantation, recent advances in understanding pancreatic islet developmental biology, and our hypoimmune technology.

Deriving islet cells from PSCs has the potential to solve limitations associated with use of a donor pancreas and improve the overall product quality and product consistency.

PSCs have the potential to create a virtually limitless supply of these cells.

Our program uses proprietary differentiation protocols to generate mature islet cells with glucose control comparable to primary human islets, as evidenced by our animal studies.

Finally, we are applying our hypoimmune technology to modify the genomes of the PSCs.

If successful, we believe the hypoimmune genome modifications will protect these PSC-derived islet cells from both autoimmune and allogeneic rejection by the patient’s immune system and potentially remove the need for toxic immunosuppression in transplant recipients.

Deriving islet cells from iPSCs has the potential to solve limitations associated with use of a donor pancreas and improve the overall product quality and product consistency.

iPSCs have the potential to create a virtually limitless supply of these cells.

We apply our hypoimmune technology to modify the genomes of the iPSCs.

We believe the hypoimmune genome modifications have the potential to protect these PSC-derived islet cells from both allogeneic and autoimmune rejection by the patient’s immune system and potentially remove the need for toxic immunosuppression in transplant recipients.

Hypoimmunity also eliminates the need for physical separation of the islet cells from the rest of the body by a device or encapsulation technology, which may allow for tighter glucose control by eliminating the lag time between glucose sensing and insulin secretion as well as avoiding the fibrotic reaction inherent in encapsulation technologies to date.

After modifying the PSC genome, our program uses proprietary differentiation protocols to generate mature islet cells with in vivo glucose control comparable to primary human islets, as evidenced by our animal studies.

Preclinical Data

We are developing a proprietary protocol to differentiate hypoimmune PSCs into mature, glucose-sensitive, insulin-secreting islet cells.

We are exploring ways to optimize the differentiation of islet cells at a greater purity and with superior function compared to published stem cell-based protocols.

The principal function of beta islet cells, the insulin-secreting cells within an islet, is to maintain steady levels of glucose in circulation.

The beta islet cells sense when glucose levels rise in the bloodstream and release insulin in response.

We have observed that our PSC-derived islet populations can respond to glucose and secrete insulin in vitro .

These PSC-derived pancreatic islets were tested in a mouse model of T1D induced by the beta cell toxin, STZ.

Building upon exclusively licensed intellectual property, we are further developing a proprietary protocol to differentiate hypoimmune iPSCs into mature, glucose-sensitive, insulin-secreting islet cells.

We are exploring ways to optimize the differentiation of islet cells at a greater purity with superior function and a greater scale compared to published stem cell-based protocols.

The principal function of pancreatic beta cells, the insulin-secreting cells within an islet, is to maintain steady levels of glucose in circulation and drive glucose uptake into cells throughout the body.

The pancreatic beta cells sense when glucose levels rise in the bloodstream and release insulin in response.

We have observed that our iPSC-derived islet populations can respond to glucose and secrete insulin in vitro and in vivo.

These iPSC-derived pancreatic islets were tested in a mouse model of T1D induced by the beta cell toxin, STZ.

When transplanted into the kidney of the T1D mice, these islet cells normalize glucose levels in an equivalent fashion to primary human islets.

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Similar to the human phenotype, T1D mice cannot normalize circulating glucose levels following a glucose injection.

Following transplantation of our islet cells, these mice rapidly normalized blood glucose in an equivalent fashion to both non-T1D mice and T1D mice that received human primary islet transplants.

Following transplantation of our islet cells, these mice rapidly normalized blood glucose in an equivalent fashion to both non-T1D mice and T1D mice that received human primary islet transplants without any evidence of abnormal cell growths or other safety signals.

We have also tested whether hypoimmune modifications to iPSC-derived islet cells can enable evasion of autoimmune rejection.

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By contrast, the hypoimmune NOD islet cells survived and achieved durable glycemic control within two weeks.

In a second set of experiments, we tested whether we would observe similar findings in a human T1D model.

A T1D patient has no functioning islets, so we derived a novel model to test the ability to overcome autoimmune recognition and rejection of these cells.

In a second set of experiments, we tested whether we observe similar findings in a human T1D model.

A T1D patient has no functioning islets, so we derived a novel model to test the ability to overcome autoimmune recognition and rejection of autologous pancreatic islets.

First, we reprogrammed immune cells from a T1D patient donor into iPSCs.

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To simulate the immune environment of a T1D patient, we developed a humanized mouse model (T1D mice) which is populated with immune cells from the same T1D patient donor and in which diabetes is subsequently induced via STZ.

Unmodified iPSC-derived islet cells injected intramuscularly into T1D mice were rejected within nine days without any impact on the mouses ability to control blood glucose.

Unmodified iPSC-derived islet cells injected intramuscularly into T1D mice were rejected within nine days without any impact on the mouse's ability to control blood glucose.

In contrast, hypoimmune iPSC-derived islet cells survived in T1D mice and resulted in glucose control within two weeks.

To confirm that the immune system was intact and functioning and in these mice, we tested the impact of a subsequent injection of unmodified iPSC-derived islet cells into the mice that had already been injected with hypoimmune iPSC-derived islet cells.

To confirm that the immune system was intact and functioning in these mice, we tested the impact of a subsequent injection of unmodified iPSC-derived islet cells into the mice that had already been injected with hypoimmune iPSC-derived islet cells.

We found that the unmodified iPSC-derived islet cells were rapidly rejected while the hypoimmune iPSC-derived islet cells and the glucose control were preserved.

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15, eadg5794 (2023) 12 April 2023.

HIP-Modified PSC-derived Islet Cells Transplanted into Muscle Persist and Control Blood Glucose in Mice for Greater than 15 Months

HIP-Modified iPSC-derived Islet Cells Transplanted into Muscle Persist and Control Blood Glucose in Mice for Greater than 15 Months

Upper left panel:

Single-cell RNA sequencing visualized via a UMAP feature plot showing insulin expression in unedited PSC-derived islet cells.

Single-cell RNA sequencing visualized via a UMAP feature plot showing insulin expression in unedited iPSC-derived islet cells.

Analysis reveals high insulin expression across stem cell-derived (sc-) islet cells, with peak expression localized within the sc-beta cell cluster.

Upper right panel:

Glucose-Responsive Human C-Peptide Production by HIP-Modified PSC Islets In Vivo at 51 Weeks Post-Transplant.

HIP-modified PSC islet cells demonstrated sustained functionality through glucose-responsive c-peptide secretion 51 weeks after transplantation (see details of transplantation conditions below).

Glucose-Responsive Human C-Peptide Production by HIP-Modified iPSC Islets In Vivo at 51 Weeks Post-Transplant.

HIP-modified iPSC islet cells demonstrated sustained functionality through glucose-responsive c-peptide secretion 51 weeks after transplantation (see details of transplantation conditions below).

Mice were fasted for five hours, and plasma was collected via tail-snip before (“pre-glucose,” light gray bar) and 30 minutes after (“post-glucose,” dark gray bar) administration of an intraperitoneal 3 g/kg dextrose bolus.

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Data presented as mean ± S.D.

Long-Term Blood Glucose Control by HIP-Modified PSC Islets.

Graph demonstrates the persistent efficacy of HIP-modified PSC islet cells in controlling blood glucose levels for greater than 64 weeks.

Nonfasted blood glucose levels were measured following transplantation of PSC-derived islet cells (5x10 6 cells/mouse) into the right hindlimb muscle of immunodeficient NSG mice (n=5).

Long-Term Blood Glucose Control by HIP-Modified iPSC Islets.

Graph demonstrates the persistent efficacy of HIP-modified iPSC islet cells in controlling blood glucose levels for greater than 64 weeks.

Nonfasted blood glucose levels were measured following transplantation of iPSC-derived islet cells (5x10 6 cells/mouse) into the right hindlimb muscle of immunodeficient NSG mice (n=5).

Diabetes was induced by a five-day, low-dose (45 mg/kg) course of STZ beginning two weeks prior to transplantation.

Diabetic (STZ) control mice did not receive PSC-derived islet cells (n=2).

Diabetic (STZ) control mice did not receive iPSC-derived islet cells (n=2).

Data is presented as mean ± S.E.M.

We are developing SC451, our HIP-modified PSC-derived islet cell product candidate, to be available as an “off-the-shelf” allogeneic therapy that can be administered intramuscularly without immunosuppression.

Single-cell RNA sequencing analysis of our initial PSC-derived islet cell differentiation process demonstrates consistent production of cell populations comprising approximately 60% beta cells, with the remainder consisting of other islet and neuroendocrine cells.

Single-cell analysis confirms the absence of residual PSCs in the final product.

In vitro studies indicate that HIP modification of PSC-derived islet cells confers immune-evasive properties, which suggests potential utility in the transplantation setting without immunosuppression.

Following intramuscular transplantation into diabetic mice, HIP-modified PSC islet cells have demonstrated survival and function for greater than 64 weeks.

We are developing SC451, our HIP-modified iPSC-derived islet cell product candidate, to be available as an “off-the-shelf” allogeneic therapy that can be administered intramuscularly without immunosuppression.

Single-cell RNA sequencing analysis of our initial iPSC-derived islet cell differentiation process demonstrates consistent production of cell populations comprising approximately 60% beta cells, with the remainder consisting of other islet and neuroendocrine cells.

Single-cell analysis confirms the absence of residual iPSCs in the final product.

In vitro studies indicate that HIP modification of iPSC-derived islet cells confers immune-evasive properties, which suggests potential utility in the transplantation setting without immunosuppression.

Following intramuscular transplantation into diabetic mice, HIP-modified iPSC islet cells have demonstrated survival and function for greater than 64 weeks.

Blood glucose normalization was observed within four weeks post-implantation and maintained throughout the study period.

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Histological examination at day 458 revealed preserved morphology, C-peptide content, vascularization, and CD47 expression.

No tumor formation or other histologic abnormalities were observed throughout the study duration.

No tumor formation or other histologic abnormalities were observed throughout the study.

Positive preliminary twelve-week clinical results, building on the four-week results, demonstrate that all primary and secondary endpoints were met.

We subsequently shared updated data at twelve weeks, 26 weeks, and 52 weeks post-transplant, which show ongoing survival, function, and immune evasion of these transplanted beta cells.

The 42-year-old recipient, who had been living with T1D for over 30 years, received a single transplant of UP421 into the muscle of the forearm.

The primary endpoint of safety was achieved with no drug product-related adverse events reported.

Prior to transplant, C-peptide levels were undetectable both in the non-fasting state and in response to an MMTT.

Prior to transplant, C-peptide levels were undetectable both in the non-fasting state and in response to a MMTT, which measures the ability of pancreatic beta cells to respond to a glucose bolus in the blood.

Pancreatic beta cells produce pro-insulin, which is cleaved and secreted as insulin and C-peptide in a 1:1 ratio, making C-peptide a well-established biomarker of endogenous insulin production.

Results of the study at four- and twelve-weeks after cell transplantation demonstrate the survival and function of pancreatic beta cells as measured by the presence of circulating C-peptide.

Results of the study at four, twelve, 26, 38, and 52 weeks after cell transplantation demonstrate the survival and function of pancreatic beta cells as measured by the presence of circulating C-peptide.

C-peptide levels also increase with an MMTT during testing at these timepoints, consistent with insulin secretion in response to a meal.

MRI scanning also demonstrated a sustained signal at the site of transplanted cells over time, which is consistent with graft survival.

PET/MRI scans at twelve weeks and 52 weeks post-transplant demonstrate uptake of a radiotracer consistent with pancreatic beta cells in the forearm muscle of the patient, a result consistent with ongoing graft survival.

No inflammation or safety-related signals were observed.

The twelve-week data were published in The New England Journal of Medicine in September 2025.

The UP421 drug product contains a mixture of islet cell populations:

WT islet cells triggered a robust immune response, with peak T cell activation at day 7 following transplantation, followed by T cell-mediated killing, and development of donor-specific antibodies.

The investigator ran in vitro assays exploring whether the patient’s immune system, either specific cell types or in whole, recognized and killed these various cell populations from the drug product.

WT islet cells triggered a robust immune response, with peak T cell activation at day seven following transplantation, followed by T cell-mediated killing, and development of donor-specific antibodies.

DKO islet cells, while avoiding T cell activation and antibody responses, were rapidly eliminated by natural killer (NK) cells.

In contrast, HIP islet cells demonstrated comprehensive immune evasion, with no evidence of T cell activation, donor-specific antibody development, or NK cell-mediated killing through twelve weeks.

These distinct immune responses were further validated in whole blood assays, where HIP islet cells uniquely survived exposure to the patient's PBMCs while both WT and DKO islet cells were eliminated.

In contrast, HIP islet cells demonstrated comprehensive immune evasion, with no evidence of T cell activation, donor-specific antibody development, or NK cell-mediated killing through 52 weeks.

These distinct immune responses were further validated in whole blood assays, where HIP islet cells survived exposure to the patient's PBMCs while both WT and DKO islet cells were eliminated.

We believe these initial results with HIP-modified cells represent a significant milestone for the field of cell therapy.

We believe these results with HIP-modified cells represent a significant milestone for the field of cell therapy.

These cells not only had to overcome the typical rejection of allogeneic cells, they also needed to overcome the pre-existing autoimmune response to pancreatic beta cells.

The results are a key landmark in our effort to develop SC451, our HIP modified stem cell-derived pancreatic islet cell product candidate, as an off-the-shelf cell therapy for patients with T1D.

Systemic Detection of C-peptide Levels Demonstrate UP421 Cell Survival

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limit of detection).

C-peptide is systemically detectable at day 7 following UP421 transplantation and stays stable up to 28, indicating survival of UP421 cells.

C-peptide is systemically detectable at day seven following UP421 transplantation and present to week 52, indicating survival of UP421 cells.

Increased C-peptide Levels with a Mixed Meal Tolerance Test Highlight UP421 Cell Survival and Function

Before UP421 transplantation, c-peptide was not detectable in the mixed meal tolerance test (grey line).

At 4 weeks after UP421 transplantation, c-peptide increases in the MMTT indicating survival and function of the UP421 islets.

Unmodified Islet Cells do Not Evade T Cell or B Cell Immune Responses

WT islet cells expressing HLA activate recipient’s T cells 7 days after transplantation.

Activation declines over time.

At baseline, patient’s T cells are not activated by the donor WT islet cells, resulting in no killing of the WT islet cells at the baseline timepoint.

When patient’s T cells are activated (7 days and after), the WT islet cells are killed.

7 days after transplantation, donor-specific antibodies of IgM type bind to donor HLA and IgM antibodies switch to IgG around day 14.

dKO Islet Cells Evade T Cell and B Cell Immune Responses but are Killed by NK Cells

dKO islet cells have endogenous CD47 expression and no expression of both HLA I and II molecules.

When exposed to patient T cells, these cells neither activate the T cells nor are they killed by the T cells.

Additionally, donor-specific antibodies do not bind to dKO islet cells.

However, patient NK cells effectively eliminate dKO islet cells at each measured timepoint due to the "missing-self" response

Prior to UP421 transplantation, C-peptide was below the limit of detection during MMTT (grey line).

At multiple measurement dates from weeks 4-52 post-transplantation, C-peptide is detectable and increases with MMTT stimulation, supporting ongoing survival and function of UP421 cells.

PET/MRI Imaging Shows Localization of UP421 Graft and Uptake of GLP‑1R-Specific Tracer, Week 12 and Week 52

PET/MRI images of the forearm following intramuscular administration of UP421.

MR T2‑STIR‑weighted imaging demonstrates localized signal within the musculus brachioradialis at the injection site, consistent with visualization of the transplanted cell graft.

PET/MRI imaging shows uptake of an Exendin‑4–based tracer specific for glucagon‑like peptide‑1 receptor (GLP‑1R)-positive cells at the same location, consistent with pancreatic beta cell survival in the forearm.

Unmodified Islet Cells Do Not Evade Immune Responses

In vitro assay testing exposure of patient blood drawn over time to wild-type, or unmodified, cells from UP421.

There is no baseline immune response to these unmodified cells, but one rapidly develops within days (data not shown above) and is maintained over twelve months, with both a T cell and antibody response to these cells (data not shown).

dKO Islet Cells are Killed by NK Cells

In vitro assay testing exposure of patient blood drawn over time to the cell population within UP421 with successful knock-out of MHC class I and MHC class II, but no overexpression of CD47.

There is a baseline immune response and killing of these cells, which is maintained over 52 weeks, which is mediated by NK cells (data not shown).

HIP Islet Cells Evade T Cell, B Cell, and NK Cell Immune Responses

HIP islet cells overexpress CD47 and have no expression of HLA I or II.

No T cell activation or killing of HIP islet cells is observed by patient’s T cells at any timepoint.

No donor-specific antibody binding nor NK cell killing of HIP islets by patient’s immune cells is observed.

Data demonstrate that HIP islet cells evade adaptive and innate immune responses.

We expect to submit an IND for SC451 as early as 2026.

Allogeneic T Cell Programs (SC291, SC262)

Our allogeneic T cell programs use T cells from healthy donors to generate CAR T therapies for various targets, including CD19, a protein expressed on the cell surface of B cells, for the potential treatment of patients with B cell mediated autoimmune diseases, and relapsed and/or refractory B cell malignancies.

We believe that applying our hypoimmune technology to allogeneic T cells will enable us to create differentiated allogeneic CAR T therapies.

Our most advanced product candidate is SC291, a CD19-directed allogeneic CAR T therapy.

In November 2023, we received IND clearance for the clinical study of SC291 in B cell mediated autoimmune diseases, including LN, ERL and ANCA-associated vasculitis, which we refer to as the GLEAM trial, and we expect to share data from this trial in 2025.

In January 2024, we received IND clearance to evaluate SC262, a CD22-directed allogeneic CAR T, for the treatment of patients with relapsed and/or refractory B cell malignancies who have received prior CD19-directed CAR T therapy, which we refer to as the VIVID trial, and we expect to share data from this trial in 2025.

Background on B Cell Mediated Autoimmune Disease

Autoimmune diseases arise from immune system dysfunction whereby the body’s immune cells mistakenly attack healthy cells and tissues in the body.

These diseases are typically characterized by defects in the adaptive immune response involving B cells and/or T cells.

These diseases can manifest across multiple organ systems and lead to a decreased quality of life or even severe disability in patients.

B cell depletion has been shown to provide clinical benefit in autoimmune disorders mediated by dysfunctional B cells, including SLE, systemic sclerosis, myositis, multiple sclerosis, ANCA-associated vasculitis, and others.

Collectively, these diseases afflict more than 5 million patients in the United States alone.

SLE is a chronic autoimmune disease that predominantly affects women of childbearing age.

Immunologic abnormalities, especially the production of antinuclear antibodies (ANA), are a prominent feature of the disease.

The exact cause of SLE remains unclear, but it is thought to result from a combination of genetic predisposition and environmental triggers.

SLE presents with a wide range of clinical signs and symptoms, as well as serologic findings, and can affect multiple organ systems.

SLE has a prevalence of approximately 400,000 across the United States, EU5, and Japan.

About 60% of SLE patients are diagnosed with LN after clinical indication of kidney involvement.

The remainder are classified as having extrarenal lupus.

The renal complications are detected through an abnormal urinalysis arising during the disease course.

LN is one of the most severe complications of SLE, in which autoantibodies cause damage to the glomerular structures in the kidney, which can result in end-stage renal disease (ESRD).

Patients with ESRD have a 5-year survival rate of 50%.

ANCA-associated vasculitis is a group of diseases characterized by loss of immunological tolerance to neutrophil protein, which causes inflammation of small blood vessels.

The primary clinical manifestations of the disease occur in the upper respiratory tract, in the kidneys, or as asthma.

The cause of ANCA-associated vasculitis is not fully understood and believed to be in part due to genetic susceptibility and environmental triggers.

There are about 60,000 ANCA-associated vasculitis patients in the United States.

Left untreated, ANCA-associated vasculitis is associated with significant morbidity, but with proper treatment, the 5-year survival rate ranges from 80% to 90%.

Current Treatment Landscape and Unmet Need

Currently, there is no standard of care treatment for achieving drug-free remission in LN patients;

therefore, patients often require life-long therapy.

While a combination approach using antimalarials (hydroxychloroquine), systemic steroids, and conventional immunosuppressant medicines (such as azathioprine (AZA), mycophenolate mofetil (MMF), and cyclophosphamide) are first-line options, a significant proportion of patients continue to have high disease activity and recurrent relapses despite therapy.

Rituximab, initially approved by the FDA in 1997 for the treatment of R/R NHL, is a monoclonal antibody (mAb) that selectively targets the B cell specific surface molecule CD20.

The LUNAR trial of rituximab failed to meet the primary endpoint of complete renal response after treatment with rituximab, although the trial demonstrated partial responses in selected patients.

Complete peripheral depletion of B cells with rituximab was not observed in all participants, and even in participants where complete peripheral depletion of B cells was observed, less than 50% achieved complete response.

A retrospective analysis of these data demonstrated that deeper B cell depletion was associated with improved complete renal responses, and that poor tissue B cell depletion was associated with non-response.

The continued persistence of autoreactive B cells in protected microenvironments, such as the lymphoid germinal center structures, correlated with the partial success of this approach in LN.

Treatments for ERL include low intensity therapies such as low-dose corticosteroids, antimalarials, and NSAIDS.

Based on worsening disease manifestations, additional immunosuppression medications can include high dose prednisone, methotrexate (MTX), AZA, and MMF, which are known to have side effects and increase the risk of significant infection.

The pivotal trial of the anti-BAFF mAb belimumab in SLE patients demonstrated a clinically meaningful improvement in patient outcomes in a large trial that enabled the first FDA drug approval for the treatment adult patients with SLE.

Although this large trial demonstrated a reduction of disease activity compared to placebo control, approximately 20% in all groups still experienced a severe disease flare.

Anifrolumab, a mAb targeting the interferon alfa signature known to be elevated in SLE patients, was approved by the FDA in 2021 for the treatment of adult patients with SLE.

Only 15% of the patients met the criteria for remission at 52 weeks, highlighting the unmet need in patients.

Since the 1970s, cyclophosphamide has been the standard of care therapy for ANCA-associated vasculitis, demonstrating a survival benefit compared to corticosteroids alone.

However, the dose-limiting toxicity of cyclophosphamide results in treatment failure and risk of chronic relapse.

Rituximab was approved for this indication based on a clinical trial in which it was shown to be non-inferior to cyclophosphamide for remission (at six months), supporting the role of B cell depletion in the treatment of these patients.

A complement C5a receptor, avacopan, was recently approved in this indication.

Despite this recent success and FDA and European Medicines Agency approval, 35-45% of patients do not achieve remission of disease at one year with these new therapies.

There is strong evidence to suggest that B cell depletion with CD19-directed CAR T cell therapy is feasible and highly effective in patients with SLE.

In a study published in 2022 from Germany, five SLE patients between 18 and 24 years of age were treated with autologous CD19-directed CAR T cell therapy.

These SLE patients had multiorgan involvement and were refractory to a variety of immunosuppressive drug treatments.

After lymphodepleting chemotherapy with fludarabine and cyclophosphamide, autologous CD19-directed CAR T cells were administered as a single intravenous infusion.

Full depletion of B cells was observed from peripheral blood in all patients from Day 2 following CAR T cell infusion, resulting in an improvement in clinical symptoms and evidence of decline of ANAs.

These data suggest that CD19-directed CAR T cell therapy induces deep B cell depletion in tissues such as lymph nodes and highlights a key advantage in the use of CD19-directed CAR T cell therapy compared to antibody-mediated B cell depletion.

All patients achieved remission status by three months, with drug-free remission maintained over a median of eight months.

B cells did reappear in these patients after approximately 110 days;

however, these B cells were naïve and showed non-class-switched B cell receptors, suggesting elimination of B cell subsets generating autoantibodies and a reset of the B cell repertoire.

Despite the reconstitution of B cells, patients did not experience flares of SLE or need additional immunosuppressive medication, indicating the achievement of drug-free remission.

As of December 2024, the drug-free clinical remission in the first patient continues almost 40 months following CAR T treatment.

Previous studies using CD19-directed CAR T cell therapy in lymphoma and leukemia have reported CRS and ICANS occurring frequently after treatment.

However, the five SLE patients receiving CAR T cell therapy had either no reported CRS or only Grade 1 CRS.

None of these five patients developed ICANS, indicating low therapy-related toxicity with CAR T cell treatment in these patients.

As of ASH 2024, this group had treated a total of 35 patients across three B cell mediated autoimmune diseases, namely SLE, idiopathic inflammatory myositis and systemic sclerosis.

Clinical remission was reported across all patients and CAR T treatment was well tolerated without the need for further immunosuppression.

Background on B Cell Malignancies

NHL is the most common cancer of the lymphatic system.

NHL is not a single disease, but rather a group of several closely related cancers.

Over 77,000 cases of NHL are diagnosed annually in the United States, and the most common subtype of NHL overall is diffuse large B cell lymphoma (DLBCL).

DLBCL, if left untreated, may have survival measured in weeks or months.

Other common subtypes of NHL include mantle cell lymphoma, follicular lymphoma, and marginal zone B cell lymphoma.

ALL is a type of leukemia that results from an uncontrolled proliferation of lymphoblasts, which are immature white blood cells.

Lymphoblasts, which are produced in the bone marrow, cause damage and death by inhibiting the production of normal cells.

Approximately 6,000 patients are diagnosed with ALL in the United States each year, and the vast majority of the approximately 1,500 ALL deaths per year occur in adults.

Approximately 80% of cases of ALL in the United States and Europe are B cell ALL, which almost always involves cancer cells that express the CD19 protein.

The five-year overall survival rate in ALL adults over the age of 60 is approximately 20%, and the median disease-free survival in patients with R/R ALL after two or more lines of therapy is less than six months.

B cell ALL is the most common cancer in children.

Although children with ALL fare better than adults, children with R/R disease have poor outcomes.

Because of the frequency of this disease, ALL remains a leading cause of death due to cancer in children.

Current Treatment Landscape and Unmet Need

First-line therapy for NHL typically consists of multi-agent cytotoxic drugs in combination with the monoclonal antibody rituximab.

In younger patients with NHL who have good organ function, high dose chemotherapy followed by stem cell transplantation is often used.

Patients often relapse, however, and since 2017, several therapeutics have been approved in the United States for the treatment of patients with R/R NHL who have received prior therapies.

These approved therapies include CD19 CAR T therapies tisagenlecleucel, axicabtagene ciloleucel, and lisocabtagene maraleucel, CD19 antibody drug conjugate therapy polatuzumab vedotin, and CD19 antibody tafasitamab.

Two autologous CD19 CAR T products have been approved in second-line patients with R/R NHL after proving to be superior to standard of care in pivotal trials.

Cure rates for ALL patients have continued to increase over the last four decades, with pediatric ALL cure rates reaching greater than 80% in developed countries.

This progress has been enabled by advances in combination chemotherapy, monitoring of minimal residual disease, expanded use of kinase inhibitors for Philadelphia chromosome-positive ALL, and the approval of Kymriah ® for R/R pediatric ALL.

Adult patients fare much worse, however, with 5-year overall survival rates of approximately 20%, and there are still significant challenges managing R/R disease across all age groups.

Multiple therapeutic candidates are in development for R/R patients, including proteasome inhibitors, antimetabolites, JAK inhibitors, and monoclonal antibodies, as well as autologous and allogeneic CAR T candidates.

As highlighted above, recent therapeutic advances across R/R B cell malignancies have led to a variety of treatment options and better patient outcomes.

In particular, autologous surface protein-directed CAR T therapies have been highly effective in certain subsets of patients with R/R disease.

However, not all patients have access to these novel therapies, and even if they able to obtain such access, many patients ultimately relapse following treatment and succumb to their cancer,

There are two primary outstanding challenges that have limited utilization of these CAR T therapies and their impact on broader groups of patients:

relapse and manufacturing challenges.

Lack of Response / Relapse .

Only about 50% of patients treated with an approved CD19-directed CAR T therapy will have a complete response and approximately one-third of patients with a complete response will relapse relatively quickly.

The emerging post-approval data from approved CAR T therapies tisagenlecleucel, axicabtagene ciloleucel and lisocabtagene maraleucel indicate that relapse can result from one of two primary factors.

1) The first involves loss of CD19 expression on malignant cells, resulting in tumor escape.

This finding was initially established for ALL and is the cause of relapse after CAR T treatment for roughly half of treated patients.

More recent data indicate that low CD19 expression contributes to the lack of response in a meaningful number of patients with NHL.

CD19 CAR T treatments have recently been tested in pivotal trials in earlier lines of therapy for NHL, which raises the possibility that more patients will be treated with CD19 CAR T therapy and subsequently relapse due to CD19 loss.

Patients with CD19 therapy failure have an extremely poor prognosis, with overall survival measurable in months and virtually no treatment options.

Therefore, the development of CAR T therapies targeting an antigen other than CD19 may provide an opportunity to address this growing unmet need.

Data from several studies have shown that CD22 CAR T treatment has led to complete responses in NHL and ALL patients that failed to reach a complete response or relapsed after CD19 CAR T treatment.

2) The second pattern of relapse relates to suboptimal CAR T cell functionality, such as poor expansion, poor persistence, or T cell exhaustion, resulting in relapse and continued growth of cancer cells that retain the targeted antigen.

Re-infusion with the same CAR T therapy has had limited benefit in these patients, although treatment with a different CAR T therapy has demonstrated some promise in ongoing clinical trials.

Manufacturing .

Because autologous CAR T therapies are patient-specific products, their manufacturing process is complex and requires significant resources, including time and labor.

Given this, infrastructure and cost considerations and limitations have resulted in limited patient access to these therapies.

Even for patients who are fortunate enough to have access to approved CAR T therapies, delays, commonly of at least one month, resulting from scheduling difficulties and issues that arise during manufacturing may prevent use of and the utility of these therapies in patients with rapidly progressing malignancies.

Certain groups are seeking to overcome access limitations by using healthy donor-derived, or allogeneic, CAR T cells instead of patient T cells to yield “off-the-shelf” therapeutics that can be manufactured consistently.

However, efficacy and durability concerns remain, largely due to the inability to effectively control the HvGR response and the risk of eventual immune rejection of these products by the recipient.

We are developing our ex vivo allogeneic T cell programs to address this HvGR and prevent immune rejection.

Limitations of Other Allogeneic CAR T Therapies

We believe our hypoimmune cells have the potential to create a differentiated platform for developing allogeneic T cells, and to address two major hurdles associated with use of allogeneic T cells.

The first is the risk of GvHD, in which the allogeneic donor T cells target and kill recipient tissues.

Multiple CAR T cell product candidates in clinical development have prevented this reaction through gene edits targeting components of the T cell receptor, such as TCR-alpha gene.

The more significant challenge has been HvGR, in which the patient’s immune system kills the transplanted T cells.

One strategy to address this challenge has been to essentially eliminate the patient’s immune system, neutering its ability to find and destroy the transplanted allogeneic CAR T cells.

However, this strategy has two limitations.

First, the patient is at risk for developing severe infections during this period of substantial immune suppression.

Second, as the immune system returns following immune suppression, it will inevitably reject the allogeneic CAR T cells, limiting their persistence, or the duration that these therapeutic cells are in the body.

In multiple independent clinical trials, regardless of the disease setting, allogeneic CAR T cells have been shown to be cleared from the patient immune system in less than a month despite high dose immunosuppression.

The therapy recipients often experience short lived clinical responses with the lack of durability correlating with the poor persistence of the allogeneic cells.

Conversely, the clinical experience with autologous CAR T cells has demonstrated that longer persistence of the CAR T correlates with durable cancer remission.

Thus, the ability to effectively prevent long-term rejection of an allogeneic CAR T therapy without significant immune suppression would provide a significant advantage over existing allogeneic approaches.

We are aware of other efforts to develop allogeneic CAR T cell products that focus on overcoming the adaptive immune system, consisting of T and B cells.

However, our hypoimmune technology addresses rejection mediated by both the adaptive and innate immune systems, which we believe will enable us to create a differentiated allogeneic CAR T solution.

Our Allogeneic T Cell Approach

Our hypoimmune technology is designed to “hide” the cell from the patient’s immune system, and we are applying this technology for the clinical development of hypoimmune allogeneic CAR T cells for a variety of therapeutic applications.

Our allogeneic T cell platform is designed to enable the substitution of CAR constructs in a modular fashion.

Initial clinical success with SC291 would support the expansion of our allogeneic CAR T efforts and enable additional product candidates to be brought forward and developed.

We are prioritizing clinically-validated antigens as well as CAR constructs that have shown robust safety and efficacy profiles in hematologic malignancies in the autologous context.

Our manufacturing process begins with T cells from healthy donors, into which we introduce the CAR gene, make the gene modifications necessary to avoid GvHD, and incorporate our hypoimmune modifications to prevent host versus graft disease.

We then expand these cells ex vivo , which enables us to both make many batches from a single T cell donor as well as create comparable CAR T cells derived from different donors.

Our vision is to freeze these allogeneic CAR T therapies, store them, and deliver them to patients as an “off the shelf” product without requiring severe immunosuppression.

SC291 Treatment Results in Deep B Cell Depletion in Non-Hodgkin’s Lymphoma Patients

CD19+ B cells levels are depleted below the limits of quantification for all NHL patients treated with SC291 at dose levels 3 and 4 up to day 28.

Figure shows quantification of CD19+ B cells levels in the peripheral blood five days before infusion (D-5) and post dosing starting at day 0.

The dashed horizontal lines indicate lower limit of the quantification (5 cells/uL).

GLEAM is a Phase 1 clinical trial evaluating SC291 in patients with LN, ERL, and ANCA-associated vasculitis.

We have also studied SC291 in patients with B cell malignancies in a trial we refer to as ARDENT, in which we have seen a generally tolerable safety profile.

Among sixteen patients, we observed no cases of Grade 2 or higher CRS, of any Grade ICANS, or of GvHD.

We observed a single case of Grade 1 IEC-HS.

All six evaluable NHL patients treated at the two highest cell dose cohorts showed deep B cell depletion.

In December 2024, the U.S.

FDA granted Fast Track designation for SC291 in SLE, which includes LN and ERL.

Fast Track designation is designed to facilitate development and expedite review of drugs that address serious conditions and unmet medical needs.

Development Plan and Key Next Steps

We expect to report progress on the GLEAM trial, in which we are evaluating SC291 in LN, ERL, and ANCA-associated vasculitis, in 2025.

The potential for B cell depletion with SC291, as seen in ARDENT, may provide clinical benefit to patients with B cell mediated autoimmune disease.

We also plan to share data from our VIVID trial, in which we are evaluating SC262 in patients with relapsed and/or refractory B cell malignancies who have received prior CD19-directed CAR T therapy, in 2025.

In vitro assay testing exposure of patient blood drawn over time to the cell population within UP421 with successful incorporation of all of the HIP modifications.

There is no baseline immune response to these cells, and no immune response develops over the course of 52 weeks.

We are transferring our manufacturing process to GMP facilities and completing our preclinical testing of SC451.

We expect to submit an IND and begin our Phase 1 clinical trial for SC451 as early as this year.

Our in vivo Cell Engineering Platform

In vivo cell engineering aims to treat human disease by delivering a therapeutic payload to cells inside a patient’s body to repair or control genes.

Historically there have been four key challenges to in vivo cell engineering:

Historically there have been four key goals for in vivo cell engineering:

• Delivering any payload (such as DNA, RNA, proteins, organelles, integrating versus non-integrating, size),

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Our in vivo cell engineering platform is focused on engineering fusogens that, when combined with delivery vehicles, can effectively deliver a payload to a desired cell or location in the appropriate quantities in vivo .

The combination of a fusogen with a delivery vehicle, is referred to as a fusosome.

We believe our platform provides us with the flexibility to deliver a wide range of payloads to make different modifications for different diseases, as well as delivery vehicle options to address volume of distribution and re-dosing, which could fundamentally expand the treatment potential for in vivo therapies.

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Commonly used AAV vectors have broad tissue specificities, making it difficult to target specific cells and potentially causing toxicity in non-target cells.

Lipid nanoparticles (LNPs) typically target any cell expressing the LDL receptor, making them both non-specific and mainly absorbed by hepatocytes in the liver when dosed systemically.

Lipid nanoparticles (LNPs) typically target cells expressing the LDL receptor, making them both non-specific and mainly absorbed by hepatocytes in the liver when dosed systemically.

Recent progress in re-targeting LNPs may allow for better delivery to cells beyond the liver, although meaningful liver absorption likely occurs.

• Limited volume of distribution :

Even when using AAV vectors for systemic delivery, therapeutically important targets like CNS cells see only limited transduction.

Even when using AAV vectors for systemic delivery, therapeutically important targets like central nervous system cells see only limited transduction.

• Immunogenicity :

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Applying Fusogens to in vivo Cell Engineering

Building on both our team’s deep understanding of fusogen biology and extensive research in protein engineering, we are developing a technology designed to allow us to engineer the biological properties of these naturally occurring proteins.

In doing so, we are developing a highly modular system that can specifically target numerous cell surface receptors and thereby deliver diverse therapeutic payloads to a variety of cell types.

Our current programs use fusogens derived from a virus from the paramyxoviridae family.

The fusogen protein complex is comprised of two proteins:

Building on both our team’s deep understanding of fusogen biology and research in protein engineering, we are developing a technology designed to allow us to engineer the biological properties of these naturally occurring proteins.

In doing so, we are developing a modular system that can specifically target numerous cell surface receptors and thereby deliver diverse therapeutic payloads to a variety of cell types.

Our current program uses fusogens derived from several viruses from the paramyxoviridae family.

The fusogen protein complexes in this family are comprised of two proteins:

the receptor recognition G protein and membrane fusion F protein.

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The F protein first partially unfolds to bind to the target membrane (3) and then refolds to bring the target and fusosome membranes in proximity (4), to ultimately promote membrane fusion (5), and subsequent payload delivery.

This mechanism allows for endosome-independent delivery of the payload, a key differentiating factor versus many other systems, described in more detail below.

Mechanism of Fusogen-Mediated Membrane Fusion

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Immunogenicity .

We are initially focusing our efforts on selecting fusogens for which the general population does not have pre-existing immunity.

We focus our efforts on selecting fusogens for which the general population does not have pre-existing immunity.

Genome Modification

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Fusosomes with a broadly tropic fusogen (BaEVTR) were engineered to deliver a nuclease and gRNA as ribonucleic protein as a VLP, with the gRNA recognizing B2M target locus.

Treatment of resting cord blood CD34+cells with fusosome resulted in 80-90% B2M knockout cells (as measured by flow cytometry 7 days post addition of fusosome), corresponding to up to 93% of edited alleles as measured by high-throughput sequencing of the B2M locus.

Treatment of resting cord blood CD34+cells with fusosome resulted in 80-90% B2M knockout cells (as measured by flow cytometry seven days post addition of fusosome), corresponding to up to 93% of edited alleles as measured by high-throughput sequencing of the B2M locus.

Two different batches of fusosomes were tested on CD34+ cells from the same donor and are represented as “Study 1” and “Study 2” in the figure.

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This greater payload size increases the potential for our fusosomes to address defects in larger genes or conditions when delivery of multiple genes may be required.

Our research efforts include other fusosomes with even larger payload capacities.

For example, we are exploring using a cell as the delivery vehicle, which can confer an almost limitless capacity.

Durability limitations .

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Our preclinical studies have also demonstrated the ability of our fusosome system to deliver non-integrating gene-editing machinery, such as CRISPR, with this system.

In this case, the entire payload does not integrate, but instead, this payload transiently delivers the machinery to permanently modify the DNA in the target cell, enabling us to make targeted, specific, and durable repairs to the genome of the target cell.

In this case, the payload does not integrate, but instead, this payload transiently delivers the machinery to permanently modify the DNA in the target cell, enabling us to make targeted, specific, and durable repairs to the genome of the target cell.

Execution in Manufacturing

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Currently, there are a number of therapies either approved or in development for ex vivo modification of autologous and allogeneic T cells.

Additionally, vectors that deliver payloads to random or off-target cells not only create the risk for toxicities, but they necessitate meaningfully larger doses in order to ensure adequate delivery to the targeted cells.

Additionally, vectors that deliver payloads to random or off-target cells not only create the risk for toxicities and immunogenicity, but they need meaningfully larger doses in order to ensure adequate delivery to the targeted cells.

Our targeted delivery offers the potential for meaningfully lower doses, which could decrease scale needs in manufacturing.

Further, we are investing across a number of areas to improve manufacturing scale, costs, consistency, and product quality in the near- and long-term, including by establishing and maintaining our relationships with our contract development manufacturing organizations (CDMO) partners and continuing to establish our internal manufacturing capabilities.

Manufacturing novel fusosome compositions is complex.

Since our inception, we have invested in improving the manufacturing of our therapies, including by investing in in scientific and process engineering aspects thereof.

Our investments include use of novel producer cell lines, novel processes, and analytical technology, as well as incorporating suspension bioreactors into our manufacturing processes early in the research phase.

By building out these capabilities early, we hope to improve the probability of technical success for our programs, which will enable us to deliver consistent supply while managing cost of goods and improve patient access.

We are also investing across a number of areas to improve manufacturing scale, costs, consistency, and product quality in the near- and long-term.

Our in vivo Cell Engineering Pipeline

T Cell Fusosome Program (SG293)

Our most advanced CAR T cell fusosome product candidate is SG299, a CD8-targeted fusosome that delivers a CD19-directed CAR to target CD19+ cancer cells that we are developing to treat patients with hematologic malignancies and autoimmune diseases.

T Cell Fusosome Approach

Our T cell fusosome approach provides us with an opportunity to develop CAR T cell therapies that can be more broadly accessible to patients than treatments that are currently available.

We also believe that the ability to deliver a payload encoding a CAR to a T cell inside the body has the potential for improved effectiveness over ex vivo manufactured CAR T cell products.

Experience thus far has demonstrated that both CD8+ and CD4+ T cells contribute to the CAR T cell response in patients that receive autologous CAR T cell therapies with conditioning lymphodepletion.

Our most advanced CAR T cell fusosome product candidate is SG293, a CD8-targeted fusosome that delivers a CD19-directed CAR to target CD19+ cells that we are developing to treat patients with hematologic malignancies and autoimmune diseases.

Background on B Cell Malignancies

Non-Hodgkin lymphoma (NHL) is the most common cancer of the lymphatic system.

NHL is not a single disease, but rather a group of several closely related cancers.

Over 77,000 cases of NHL are diagnosed annually in the United States, and the most common subtype of NHL overall is diffuse large B cell lymphoma (DLBCL).

DLBCL, if left untreated, may have survival measured in weeks or months.

Other common subtypes of NHL include mantle cell lymphoma, follicular lymphoma, and marginal zone B cell lymphoma.

Acute lymphoblastic leukemia (ALL) is a type of leukemia that results from an uncontrolled proliferation of lymphoblasts, which are immature white blood cells.

Lymphoblasts, which are produced in the bone marrow, cause damage and death by inhibiting the production of normal cells.

Approximately 6,000 patients are diagnosed with ALL in the United States each year, and the vast majority of the approximately 1,500 ALL deaths per year occur in adults.

Approximately 80% of cases of ALL in the United States and Europe are B cell ALL, which almost always involves cancer cells that express the CD19 protein.

The five-year overall survival rate in ALL adults over the age of 60 is approximately 20%, and the median disease-free survival in patients with relapsed or remitting, or R/R, ALL after two or more lines of therapy is less than six months.

B cell ALL is the most common cancer in children.

Although children with ALL fare better than adults, children with R/R disease have poor outcomes.

Because of the frequency of this disease, ALL remains a leading cause of death due to cancer in children.

Current Treatment Landscape and Unmet Need

First-line therapy for NHL typically consists of multi-agent cytotoxic drugs in combination with the monoclonal antibody rituximab.

In younger patients with NHL who have good organ function, high dose chemotherapy followed by stem cell transplantation is often used.

Patients often relapse, however, and since 2017, several therapeutics have been approved in the United States for the treatment of patients with R/R NHL who have received prior therapies.

These approved therapies include CD19 autologous CAR T therapies tisagenlecleucel, axicabtagene ciloleucel and lisocabtagene maraleucel;

CD20xCD3 bi-specific antibodies epcoritamab-bysp and glofitamab-gxbm;

CD19 antibody drug conjugate therapy polatuzumab vedotin;

and CD19 antibody tafasitamab.

Two of these autologous CD19 CAR T products have been approved in second-line patients with R/R NHL after proving to be superior to standard of care in pivotal trials.

Cure rates for ALL patients have continued to increase over the last four decades, with pediatric ALL cure rates reaching greater than 80% in developed countries.

Adult patients fare much worse, however, with 5-year overall survival rates of approximately 20%, and there are still significant challenges managing R/R disease across all age groups.

As highlighted above, recent therapeutic advances across R/R B cell malignancies have led to a variety of treatment options and better patient outcomes.

In particular, autologous surface protein-directed CAR T therapies have been highly effective in certain subsets of patients with R/R disease.

However, not all patients have access to these novel therapies, and even if they able to obtain such access, many patients ultimately relapse following treatment and succumb to their cancer,

T Cell-Targeted Fusosome Approach

We believe that our T cell-targeted fusosome approach provides us with an opportunity to develop CAR T cell therapies that can be more broadly accessible to patients than currently available treatments.

We also believe that the ability to deliver a payload encoding a CAR to a T cell inside the body has the potential for improved effectiveness and safety over ex vivo manufactured CAR T cell products.

Our first fusosome program will deliver the CAR gene using fusogens that directly and specifically target the CD8 co-receptor on T cells following a single intravenous injection.

We believe that this approach could result in the generation of therapeutically active CAR T cells without the complexities and delays associated with the process of T cell collection and ex vivo manufacturing.

We may target the CD4 co-receptor in future programs.

Furthermore, ex vivo expansion in the presence of high cytokine concentrations, although necessary for the manufacture of approved CAR T cell products, also contributes to marked changes in T cell quality that may not be therapeutically beneficial.

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Finally, the effectiveness of ex vivo manufactured CAR T cells is dependent on the administration of a lymphodepleting preparative regimen prior to infusion to facilitate expansion of the CAR T cell product, which can have meaningful adverse safety implications.

We do not expect to use a lymphodepleting regimen prior to in vivo delivery of the CAR gene, as our goal is to expose our fusosomes to as many T cells in the body as possible.

We do not expect to use a lymphodepleting regimen pre-exposure to in vivo delivery of the CAR gene.

Preclinical Data

Our preclinical data have demonstrated that fusosomes can deliver a genetic payload specifically and efficiently to human T cells in culture, as well as in immunodeficient mice with intraperitoneally-injected human peripheral blood mononuclear cells (PBMCs) that have been infused with a single dose of a fusosome.

Our preclinical data have demonstrated that fusosomes can deliver a genetic payload specifically and efficiently to human T cells in culture, as well as in immunodeficient mice with intraperitoneally-injected human PBMCs that have been infused with a single dose of a fusosome.

The T cells can be categorized into functional subsets based on the expression pattern of cell surface molecules.

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Using a human xenograft mouse model for leukemia (Nalm-6), we observed both prolonged survival and clearance of the leukemic cells.

During the manufacture of autologous CAR T cells, cytokine signaling must be activated in order to successfully produce functional CAR T cells.

In our mouse experiments the CD8-targeted fusosome was able to generate CD19-directed CAR T cells just as effectively with activated as non-activated donor T cells.

SG299’s CD8-targeting fusogen cross reacts with CD8 in most NHP species.

A prior candidate from our fusogen platform, SG299, a CD8-targeting fusogen that cross reacts with CD8 in most NHP species, included a CD19 CAR gene that encoded for a CD19-targeted CAR that does not cross-react with NHP CD19.

In a GLP toxicology study conducted in nemestrina macaques, a single intravenous injection of SG299 demonstrated selective, dose-dependent gene delivery to target CD8+ T cells as measured by integrated vector copy number.

The level of gene delivery is consistent with up to 20% of target cells receiving CAR transgene at the highest dose level.

The level of gene delivery was consistent with up to 20% of target cells receiving CAR transgene at the highest dose level.

Tissue analysis showed minimal to no quantifiable presence in non-target tissues, including the liver and gonadal tissue.

No infusion-related toxicity or CAR-associated toxicity (cytokine release syndrome or neurotoxicity) was observed.

Because the CD19 CAR does not cross-react with nemestrina CD19, we were unable to explore CAR T expansion kinetics or efficacy in depleting target cells in this experiment.

To evaluate in vivo CAR T generation and B cell depletion, we developed a surrogate SG299 that delivers a CD20 CAR capable of targeting NHP B cells in cynomolgus macaques.

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B cell phenotype analyses performed after peripheral B cells returned show a “B cell reset,” with a predominance of naïve B cells in circulation.

Taken together, these results suggest that SG299 can be safely dosed in NHPs and has the potential to deliver a CAR transgene that can result in deep and durable depletion of B cells without lymphodepletion.

Taken together, these results suggested that SG299 could be safely dosed in NHPs and had the potential to deliver a CAR transgene that could result in deep and durable depletion of B cells without lymphodepletion.

Transduction of Circulating CD8+ T cells by SG299 in NHPs

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black, tattoo ink.

We next incorporated the findings from these as well as several other studies into our next-generation product, SG293, which has several important changes when compared to SG299 while retaining the CD19 CAR.

First, SG293 utilizes a fusogen from a different paramyxovirus, which in preclinical models has demonstrated enhanced potency and specificity.

Second, SG293 incorporates an activation signal on the surface of the fusosome to enhance CAR expression and early potency post-transduction.

Third, we have made several changes to the manufacturing process to minimize the expression of the CAR transgene on the fusosome surface, which we have shown in animal models decreases the risk of an immune response to the CAR, as well as improve safety.

We believe these changes will enhance efficacy, safety, and manufacturability.

In January 2026, we shared data from a preclinical study using a surrogate for SG293 that delivers a CD20 CAR capable of targeting NHP B cells in cynomolgus macaques.

No lymphodepletion was administered to the NHPs in this study.

A single intravenous injection of SG293 to these NHP resulted in robust in vivo generation of CAR T cells and deep B cell depletion in the peripheral blood and lymph nodes.

The B cell depletion was further confirmed by lymph node biopsies showing clearing of B cells as well as by a “reset” of the NHPs’ B cell repertoire toward naïve B cells.

We believe that deep B cell depletion in this preclinical model is the most significant biomarker for potential efficacy in patients with B cell cancers and B cell-mediated autoimmune diseases.

We continue to evaluate SG293 in other preclinical studies.

Surrogate SG293 NHP Study Design

Surrogate SG293 Transduces CD8+ T Cells in NHPs with Expansion over 7-28 Days

Surrogate SG293 Results in Deep B Cell Depletion in Peripheral Blood in NHPs

Surrogate SG293 Results in Deep B Cell Depletion in NHP Lymph Node

B cell clearance in lymph nodes without lymphodepletion.

Lymph nodes from cynomolgus macaques injected intravenously with an SG293 surrogate delivering a CD20 CAR transgene.

Biopsy performed three-weeks post-injection in one control animal and two treated animals.

Tissues were analyzed by immunohistochemistry.

Brown, anti-CD20;

blue, hematoxylin;

black, tattoo ink.

Surrogate SG293 Results in B Cell “Reset” in NHPs

B cell reset in nonhuman primates (NHPs) is illustrated by the depletion of circulating and lymphoid tissue B cells following a single intravenous administration of an SG293 surrogate, followed by repopulation of the B cell compartment with a predominance of naïve B cells.

In these studies, B cell reconstitution was characterized by an increased proportion of IgD⁺/CD27⁻ naïve B cells relative to memory B cell subsets, consistent with a resetting of the B cell repertoire.

SG293 Demonstrates Greater in vitro Specificity for On‑Target Cells Compared to a Targeted VSV‑G Fusogen

In vitro assessment of fusogen‑mediated gene delivery across on‑target and off‑target cell types.

Shown is vector copy number (VCN) per diploid genome following exposure of indicated human cell lines and primary cells to SG293, SG299, or a blinded VSV‑G fusogen control.

On‑target cells represent CD8⁺ T‑cell surrogates, while off‑target cells include cell lines and primary cells with low or high phagocytic activity, endothelial cells, epithelial cells, hepatocytes, and CD34⁺ hematopoietic progenitor cells under resting and activated conditions.

Data illustrate selective gene delivery by SG293 to on‑target cells with lower relative transduction of off‑target cell types compared to the targeted VSV‑G fusogen under the tested conditions.

Development Plan and Key Next Steps

We are working to finalize the product composition, perform GMP manufacturing of SG299, and conduct other critical activities for an IND.

We anticipate our initial study with SG299 will be in the oncology setting followed rapidly by a study in B cell mediated autoimmune disease.

Importantly, this therapy offers the potential for cell-specific delivery and CAR T activity with no lymphodepleting chemotherapy.

We anticipate submitting an IND for SG299 as early as 2026.

We intend to develop SG293 initially in B cell cancers such as non-Hodgkin lymphoma and acute lymphoblastic leukemia.

If we generate appropriate safety and efficacy signals in these settings, we intend to expand testing into B cell mediated autoimmune diseases such as lupus.

We are also developing in vivo CAR T therapies toward other targets, such as B cell maturation antigen ( BCMA), though we plan to learn from initial clinical experience with SG293 before advancing therapies for other targets into human testing.

We intend to begin clinical testing and generate initial clinical data for SG293 as early as this year.

Manufacturing Strategy and Approach

Although the field of cell and gene therapy has had a number of successes with innovative therapies, the challenges of manufacturing at industrial scale have limited access for patients in need.

As was the case during the initial development of recombinant biologics, an improvement to our ability to characterize these products will be essential to increasing patient access.

As was the case during the initial development of recombinant biologics, an improvement in our ability to characterize these products will be essential to increasing patient access.

It is especially critical to have an in-depth understanding of the impact of manufacturing processes on the product quality attributes and resulting clinical performance of the product.

From inception, we have recognized the key role manufacturing plays in enabling the access of these innovative engineered cells as medicines.

From inception, we have recognized the key role manufacturing plays in enabling access to these innovative engineered cells as medicines.

Two areas of particular focus are product analytical and biological characterization, leading to a better definition of critical product attributes, as well as process understanding, leading to better control the impact of process parameters on these critical product attributes.

We have developed a manufacturing strategy with early investments in people, technology, and infrastructure, which requires:

• establishing a team with diverse, experienced talents with extensive knowledge of both the process and analytical sciences in the field of cell and gene therapy, as well as CMC product development expertise from preclinical to global commercialization;

• establishing multiple manufacturing platforms for our diverse portfolio;

• establishing a team with diverse experience and talent with extensive knowledge of both the process and analytical sciences in the field of cell and gene therapy, as well as CMC product development expertise from preclinical to global commercialization;

• establishing manufacturing platforms for our ex vivo and in vivo product candidates;

• establishing infrastructure from lab bench to a GMP manufacturing and supply chain network.

To support our development pipeline, we have established process development for allogeneic T cells and PSC-derived therapies.

To support our development activities, we have established process development for our iPSC-derived and fusogen platform therapies.

Although our manufacturing processes for these therapies vary, they also share some common challenges and opportunities.

For example, product characterization and analytical development are critical, and these capabilities are largely fungible across processes.

In addition, we are focusing on some of the key areas in each of our processes to enable scaled manufacturing.

For the allogeneic T cell therapies, we are focusing on scaling the multiplex gene editing process and understanding of the impact of the variability of the starting material from healthy donors to on product quality.

In addition, we are focusing on key areas in our iPSC-derived therapy processes to enable scaled manufacturing.

For stem-cell derived therapies, such as islet cells, we are focusing on developing a scalable process and analytical technologies to characterize stability of the starting cells, end cell products, and critical product quality attributes.

Our non-GMP pilot plant for engineered cell platform processes has up to 200L bioreactor scale.

This provides the infrastructure for process and technology development, technology transfer support, and production for non-GMP material such for GLP toxicology studies.

We expect to use CDMOs for initial GMP supply to support our upcoming INDs and clinical trials and anticipate we will use CDMOs for at least some portions of our supply chain for the foreseeable future.

In June 2022, we entered into a long-term lease to establish and develop our own GMP manufacturing facility to support the manufacturing of product candidates across our product portfolio, such as the production of allogeneic T cells.

Other companies have stated that they are developing cell and gene therapies that may address type 1 diabetes, B cell mediated autoimmune disorders, and oncology.

Other companies have stated that they are developing cell and gene therapies that may address type 1 diabetes, oncology, and B cell mediated autoimmune disorders.

Some of these companies may have substantially greater financial and other resources than we have, such as larger research and development staff and well-established marketing and salesforces or may operate in jurisdictions where lower standards of evidence are required to bring products to market.

For example, we are aware that some of our competitors, including Allogene Therapeutics, Inc., Bristol-Myers Squibb Company, Cabaletta Bio, Inc., Caribou Biosciences, Inc., Cargo Therapeutics, Inc., Century Therapeutics, Inc., CRISPR Therapeutics AG, Eli Lilly and Company, Fate Therapeutics, Inc., Gilead Sciences, Inc., Interius BioTherapeutics, Inc., Johnson & Johnson, Kyverna Therapeutics, Inc., Legend Biotech Corporation, Novartis AG, Novo Nordisk A/S, Roche Holding AG, Umoja Biopharma, Inc., and Vertex Pharmaceuticals Inc., might be conducting large-scale clinical trials for therapies that could be competitive with our ex vivo and in vivo programs.

For example, we are aware that some of our competitors, including AbbVie Inc., Allogene Therapeutics, Inc., Aspect Biosystems Ltd., AstraZeneca PLC, Bristol-Myers Squibb Company, Cabaletta Bio, Inc., Caribou Biosciences, Inc., Century Therapeutics, Inc., CRISPR Therapeutics AG, Eli Lilly and Company, Gilead Sciences, Inc., Johnson & Johnson, Kelonia Therapeutics, Inc., Kyverna Therapeutics, Inc., Legend Biotech Corporation, Novartis AG, Roche Holding AG, Umoja Biopharma, Inc., and Vertex Pharmaceuticals Inc., might be conducting small- or large-scale clinical trials for therapies that could be competitive with our ex vivo and in vivo programs.

Among companies pursuing ex vivo and in vivo cell engineering, we believe we are substantially differentiated by our robust intellectual property portfolio, extensive research, rigorous and objective approach, and multidisciplinary capabilities.

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Our commercial success will depend in part on our ability to obtain and maintain patent and other proprietary protection for our technology, inventions, and improvements, preserve the confidentiality of our trade secrets, maintain our licenses to use intellectual property owned by third parties, defend and enforce our proprietary rights, including our patents, and operate without infringing on the valid and enforceable patents and other proprietary rights of third parties.

We have in-licensed and developed numerous patents and patent applications, which include claims directed to compositions, methods of use, processes, dosing, and formulations, and possess substantial know-how and trade secrets relating to the development and commercialization of our ex vivo and in vivo cell engineering platforms and related product candidates, including related manufacturing processes.

As of January 2025, our in-licensed and owned patent portfolio consisted of approximately 45 licensed or owned U.S.

issued patents, approximately 57 licensed United States pending patent applications, and approximately 86 owned U.S.

pending patent applications, as well as approximately 74 licensed patents issued in jurisdictions outside of the United States, approximately 263 licensed patent applications pending in jurisdictions outside of the United States, and approximately 312 owned patent applications pending in jurisdictions outside of the United States (including approximately 30 owned pending Patent Cooperation Treaty (PCT) applications) that, in many cases, are counterparts to the foregoing United States patents and patent applications.

We have in-licensed and own numerous patents and patent applications, which include claims directed to compositions, methods of use, processes, dosing, and formulations, and possess substantial know-how and trade secrets relating to the development and commercialization of our ex vivo and in vivo cell engineering platforms and related product candidates, including related manufacturing processes.

As of January 2026, our in-licensed and owned patent portfolio consisted of approximately 48 licensed or owned United States issued patents, approximately 57 licensed United States pending patent applications, and approximately 70 owned United States pending patent applications, as well as approximately 101 licensed patents issued in jurisdictions outside of the United States, approximately 234 licensed patent applications pending in jurisdictions outside of the United States, and approximately 238 owned patent applications pending in jurisdictions outside of the United States (including approximately 26 owned pending Patent Cooperation Treaty (PCT) applications) that, in many cases, are counterparts to the foregoing United States patents and patent applications.

The patents and patent applications outside of the United States in our portfolio are held primarily in Europe, Canada, China, Japan, and Australia.

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In the United States, a patent’s term may be lengthened by patent term adjustment, which compensates a patentee for administrative delays by the Unites States Patent and Trademark Office (USPTO) in examining and granting a patent counterbalanced by delays on the part of a patentee, or may be shortened if a patent is terminally disclaimed over another patent.

In addition, in certain instances, the term of a United States patent that covers an FDA-approved drug may also be eligible for patent term extension, which recaptures a portion of the term effectively lost as a result of the testing and regulatory review periods required by the FDA.

In addition, in certain instances, the term of a United States patent that covers an FDA-approved drug may also be eligible for patent term extension, which recaptures a portion of the term effectively lost due to the testing and regulatory review periods required by the FDA.

The patent term extension period cannot be longer than five years, and the total patent term, including the extension, cannot exceed 14 years following FDA approval.

There is no guarantee that the applicable authorities will agree with our assessment of whether such extensions should be granted, and, if granted, the length of such extensions.

There is no guarantee that the applicable authorities will agree with our assessment of whether such extensions should be granted for our patents, and, if granted, the length of such extensions.

Similar provisions are available in Europe and other foreign jurisdictions to extend the term of a patent that covers an approved drug.

However, the actual protection afforded by a patent varies on a product-by-product and country-to-country basis and depends upon many factors, including the type of patent, the scope of its coverage, the availability of regulatory-related extensions, the validity and enforceability of the patent, and the availability of legal remedies in a particular country.

Our patents issued as of January 2026 have terms expected to expire on dates ranging from 2029 to 2042.

If patents are issued on our patent applications pending as of January 2026, the resulting patents are projected to expire on dates ranging from 2033 to 2046.

As discussed elsewhere in this Annual Report, we are currently prioritizing development of our SC451 program for the treatment of type 1 diabetes, which uses our hypoimmune technology, and our SG293 program for the treatment of B cell-mediated diseases, which uses our fusogen technology.

There are approximately four patent families containing granted patents that are currently material to our SC451 program, which are licensed to us.

The first patent family includes patents granted in the United States and Australia, which include composition of matter, use, and process protection, and the last of which is currently expected to expire in 2036.

The second patent family includes patents granted in Australia and New Zealand, which include composition of matter, use, and process protection, and the last of which is currently expected to expire in 2038.

The third patent family includes patents granted in the United States and Israel, which include composition of matter and process protection, and the last of which is currently expected to expire in 2041.

The fourth patent family includes patents granted in Australia and Japan, which include composition of matter, use, and process protection, and the last of which is currently expected to expire in 2039.

Each of these patent families also includes pending patent applications in other jurisdictions.

There are approximately two patent families containing granted patents that are currently material to our SG293 program, which are licensed to us.

The first patent family includes patents granted in the United States, Australia, Europe, Hong Kong, Israel, Japan, Korea, Mexico, and Singapore, which include composition of matter, use, and process protection, and the last of which is currently expected to expire in 2039.

The second patent family includes patents granted in Australia, Japan, and Korea, which include composition of matter, use, and process protection, and the last of which is currently expected to expire in 2039.

Each of these patent families also includes pending patent applications in other jurisdictions.

In some instances, we submit patent applications directly to the USPTO as provisional patent applications.

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The corresponding non-provisional application benefits in that the priority date(s) of this patent application is/are the earlier provisional application filing date(s), and the patent term of the finally issued patent is calculated from the later non-provisional application filing date.

This system allows us to obtain an early priority date, add material to the patent application(s) during the priority year, obtain a later start to the patent term, and to delay prosecution costs, which may be useful in the event that we decide not to pursue examination in an application.

While we intend to timely file non-provisional patent applications relating to our provisional patent applications, we cannot predict whether any such patent applications will result in the issuance of patents that provide us with any competitive advantage.

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We cannot predict whether the patent applications we are currently pursuing will issue as patents in any particular jurisdiction or whether the claims of any issued patents will provide sufficient proprietary protection from competitors.

Any patents that we hold may be challenged, circumvented, or invalidated by third parties.

The area of patent and other intellectual property rights in biotechnology is an evolving one with many risks and uncertainties.

Further, any patents that we hold may be challenged, circumvented, or invalidated.

The area of patent and other intellectual property rights in biotechnology continues to evolve and has many risks and uncertainties.

The patent positions of companies like ours are generally uncertain and involve complex legal and factual questions.

No consistent policy regarding the scope of claims allowable in patents in the fields of cell and gene therapy has emerged in the United States.

The patent positions of companies outside of the United States can be even more uncertain.

No consistent policy regarding the scope of allowable patent claims in the fields of cell and gene therapy has emerged in the United States.

Companies' patent positions outside of the United States can be even more uncertain.

Changes in either the patent laws or their interpretation in the United States and worldwide may diminish our ability to protect our inventions and enforce our intellectual property rights, and more generally could affect the value of our intellectual property.

In particular, our ability to stop third parties from making, using, selling, offering to sell, or importing products that infringe our intellectual property will depend in part on our success in obtaining and enforcing patent claims that cover our technology, inventions, and improvements.

With respect to both licensed and company-owned intellectual property, we cannot be sure that patents will be granted with respect to any of our pending patent applications or with respect to any patent applications filed by us in the future, nor can we be sure that any of our existing patents or any patents that may be granted to us in the future will be commercially useful in protecting our products and the methods used to manufacture those products.

Moreover, our issued patents do not guarantee us the right to practice our technology in relation to the commercialization of our products, as third parties may have blocking patents that could be used to prevent us from commercializing our patented product candidates and practicing our proprietary technology.

It is uncertain whether the issuance of any third-party patent would require us to alter our development or commercial strategies, products, or processes, obtain licenses, or cease certain activities.

Our breach of any license agreements or our failure to obtain a license to proprietary rights required to develop or commercialize our future products may have a material adverse impact on us.

If third parties prepare and file patent applications in the United States that also claim technology to which we have rights, we may have to participate in interference or derivation proceedings in the USPTO to determine priority of invention.

In particular, our ability to stop third parties from making, using, selling, offering to sell, or importing products that infringe our intellectual property will depend in part on our ability to obtain and enforce patent claims that cover our technologies, inventions, and improvements.

With respect to both our in-licensed and owned intellectual property, we cannot be sure that patents will be granted with respect to any pending patent applications or with respect to any patent applications we may file in the future, nor can we be sure that any of our existing patents or any patents that may be granted to us in the future will be commercially useful in protecting our products and the methods used to manufacture those products.

Moreover, our issued patents do not guarantee us the right to practice our technology in relation to the commercialization of our products, as third parties may have blocking patents that could prevent us from commercializing our patented product candidates and practicing our proprietary technology.

It is uncertain whether the issuance of any patent to a third party would require us to alter our development or commercial strategies, products, or processes, obtain licenses, or cease certain activities.

Our breach of any license agreements or our failure to obtain a license to proprietary rights required to develop or commercialize our products may have a material adverse impact on us.

If third parties file patent applications in the United States that also claim technology to which we have rights, we may have to participate in interference or derivation proceedings in the USPTO to determine priority of invention.

Our issued patents and those that may issue in the future may be challenged, invalidated, or circumvented, which could limit our ability to stop competitors from marketing related products or limit the length of the term of patent protection that we may have for our product candidates.

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Furthermore, our competitors may independently develop similar technologies.

For these reasons, we may have competition for our product candidates.

For these reasons, we may face competition for our product candidates.

Moreover, because of the extensive time required for development, testing, and regulatory review of a potential product candidate, it is possible that, before any particular product candidate can be commercialized, any related patent may expire or remain in force for only a short period following commercialization, thereby reducing any advantage of the patent.

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Patent disputes are sometimes interwoven into other business disputes.

As of January 2025, our registered trademark portfolio contained approximately 26 registered trademarks and pending trademark applications, consisting of approximately one pending trademark application and three registered trademarks in the United States, and approximately 18 registered trademarks and approximately four pending trademark applications in the following countries through both national filings and under the Madrid Protocol:

As of January 2026, our registered trademark portfolio contained approximately 25 registered trademarks and pending trademark applications, consisting of approximately three registered trademarks in the United States and approximately 21 registered trademarks and approximately one pending trademark application in the following countries through both national filings and under the Madrid Protocol:

Australia, Canada, China, European Union, India, Japan, Republic of Korea, the United Kingdom, Singapore, and Switzerland.

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In addition, our trade secrets may otherwise become known or may be independently discovered by competitors.

To the extent that our employees, contractors, consultants, collaborators, and advisors use intellectual property owned by others in their work for us, disputes may arise as to the rights in related or resulting know-how and inventions.

For this and more comprehensive risks related to our proprietary technology, inventions, improvements, and products, see the subsection titled “Risk Factors —Risks Related to Intellectual Property and Information Technology.”

To the extent that our employees, contractors, consultants, collaborators, advisors, or other third parties use intellectual property owned by others in their work for us, disputes may arise as to the rights in related or resulting know-how and inventions.

For additional information regarding this and more comprehensive risks related to our proprietary technology, inventions, improvements, and products, see the subsection titled “Risk Factors —Risks Related to Intellectual Property and Information Technology.”

Key Intellectual Property Agreements

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The potential Harvard Success Payments are based on multiples of increasing value ranging from 5x to 40x based on a comparison of the per share fair market value of our common stock relative to the original issuance price of $4.00 per share at ongoing pre-determined valuation measurement dates.

The Harvard Success Payments can be achieved over a maximum of 12 years from the effective date of the agreement.

The Harvard Success Payments can be achieved over a maximum of 12 years from the effective date of the Harvard Agreement.

If a higher success payment tier is met at the same time a lower tier is met, both tiers will be owed.

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As of December 31, 2025, a Harvard Success Payment had not been triggered.

The Harvard Agreement will expire upon the expiration of the last-to-expire valid claim within the licensed patent rights or, if later, at the end of the final royalty term, which is determined on a Harvard Product-by-Harvard Product and country-by-country basis, and is the later of (i) the date on which the last valid claim within the licensed patent rights covering such Harvard Product in such country expires, (ii) expiry of regulatory exclusivity for such Harvard Product in such country, or (iii) ten years from the first commercial sale of such Harvard Product in such country, which we expect to occur in 2039.

The Harvard Agreement will expire upon the expiration of the last-to-expire valid claim within the licensed patent rights or, if later, at the end of the final royalty term, which is determined on a Harvard Product-by-Harvard Product and country-by-country basis, and is the later of (i) the date on which the last valid claim within the licensed patent rights covering such Harvard Product in such country expires, which we expect to occur in 2039, (ii) expiry of regulatory exclusivity for such Harvard Product in such country, or (iii) ten years from the first commercial sale of such Harvard Product in such country.

We also have the right to terminate the Harvard Agreement in its entirety for any reason upon 45 days’ prior written notice to Harvard.

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In January 2019, we entered into a license agreement (as amended, the UCSF Agreement) with The Regents of the University of California (The Regents) acting through its Office of Technology Management, University of California San Francisco (UCSF), pursuant to which we obtained an exclusive license to inventions related to immunoengineered pluripotent cells and derivatives claimed in United States and international patents and patent applications (UCSF Patent Rights) by The Regents.

The license grants us rights to make, have made, use, sell, offer for sale and import licensed products that are covered by such UCSF Patent Rights, provide licensed services, practice licensed methods, and otherwise practice under the UCSF Patent Rights, for use in humans only, in the United States and other countries where The Regents is not prohibited by applicable law from granting such UCSF Patent Rights.

The UCSF Agreement grants us rights to make, have made, use, sell, offer for sale and import licensed products that are covered by such UCSF Patent Rights, provide licensed services, practice licensed methods, and otherwise practice under the UCSF Patent Rights, for use in humans only, in the United States and other countries where The Regents is not prohibited by applicable law from granting such rights under such UCSF Patent Rights.

We have the right to sublicense our rights granted under the UCSF Agreement to third parties subject to certain terms and conditions.

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We are required to use commercially reasonable efforts to obtain all necessary governmental approvals in each country where licensed products or licensed services are manufactured, used, sold, offered for sale, or imported.

We are required to spend at least $30.0 million towards research, development, and commercialization of licensed products within five years after the closing of our Series A-2 convertible preferred stock financing.

In addition, we are required to achieve certain specified development and regulatory milestones within specified time periods.

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In addition, we entered into an amendment to the UCSF Agreement in December 2020, pursuant to which we issued 37,500 shares of our common stock to The Regents.

We are required to pay license maintenance fees ranging from $10,000 on the first anniversary of the effective date of the UCSF Agreement to $40,000 on the sixth anniversary and continuing annually thereafter.

We are required to pay annual license maintenance fees of $40,000 per year.

This fee will not be due if we are selling or exploiting licensed products or licensed services and paying an earned royalty to The Regents on net sales of such licensed products or licensed services.

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We are required to pay to The Regents a minimum annual royalty of $100,000 beginning with the year of the first sale of a licensed product or licensed service and ending upon the expiration of the last-to-expire UCSF Patent Right.

This will be credited against any earned royalty due for the twelve-month period following for which the minimum payment was made and pro-rated.

This amount will be credited against any earned royalty due for the 12-month period for which the minimum payment was made and will be pro-rated under certain circumstances.

We are also obligated to pay The Regents a percentage of certain non-royalty sublicense income ranging from the low double-digits to mid-twenties.

The UCSF Agreement will expire on expiration or abandonment of the last valid claims within the UCSF Patent Rights licensed thereunder, which we expect to occur in 2040.

The UCSF Agreement will expire on expiration or abandonment of the last valid claims within the UCSF Patent Rights, which we expect to occur in 2040.

The Regents has the right to terminate the Agreement if we fail to cure or discontinue a material breach within 60 days of receiving a notice of default.

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If the UCSF Agreement is terminated for any reason, then, upon the request of any sublicensee, The Regents will enter into a direct license with such sublicensee on the same terms as the UCSF Agreement, taking into account any difference in license scope, territory, and duration of sublicense grant, provided that such sublicensee is not at the time of such termination in breach of its sublicensing agreement and is not at the time of such termination an opposing party in any legal proceeding against The Regents.

2019 Exclusive License Agreement with Washington University

In November 2019, we entered into a license agreement (the 2019 WU Agreement) with Washington University, pursuant to which we obtained an exclusive sublicensable, non-transferable, worldwide license under certain Washington University patent rights related to genetically engineered hypoimmunogenic stem cells to research, develop, make, have made, and sell products, the manufacture, use, sale or import of which by us or our sublicensees would, in the absence of the 2019 WU Agreement, infringe at least one valid claim of the licensed patent rights (WU Hypoimmune Products).

2019 License Agreement with Washington University

In November 2019, we entered into an exclusive license agreement (the 2019 WU Agreement) with Washington University, pursuant to which we obtained an exclusive sublicensable, non-transferable, worldwide license under certain Washington University patent rights related to genetically engineered hypoimmunogenic stem cells to research, develop, make, have made, and sell products, the manufacture, use, sale or import of which by us or our sublicensees would, in the absence of the 2019 WU Agreement, infringe at least one valid claim of the licensed patent rights (WU Hypoimmune Products).

We are obligated to use commercially reasonable efforts to (i) develop, manufacture, promote and sell WU Hypoimmune Products and (ii) achieve certain development, regulatory, and commercial diligence milestones within specified time periods.

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Washington University retains the right to make, have made, use, and import WU Hypoimmune Products in fields relating to diagnosis, prevention, and treatment of human diseases or disorders for research and educational purposes, including collaboration with other nonprofit entities, but excluding any commercial purposes, and such retained rights do not limit our ability to pursue our programs and product candidates.

Washington University retains all rights not granted to us under the patents.

Washington University retains all rights not granted to us under the patent rights licensed to us under the 2019 WU Agreement.

In addition, the 2019 WU Agreement is subject to certain rights retained by the United States government, including the requirement that licensed products sold in the United States be substantially manufactured in the United States.

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In addition, Washington University may terminate the 2019 WU Agreement (i) upon 30 days’ written notice if we fail to achieve certain development, regulatory, or commercial diligence milestones and are unable to resolve Washington University’s concerns through good faith negotiations in accordance with the 2019 WU Agreement, (ii) upon our bankruptcy or insolvency, or (iii) if an order is made or a notice is issued convening a meeting of our stockholders to consider the passing of a resolution of our winding up or a resolution is passed for our winding up (in each case, other than for the purpose of amalgamation or reconstruction).

If the 2019 WU Agreement terminates prior to the expiration of the last-to-expire licensed patent rights, we agree (i) to promptly discontinue the exportation of licensed products, (ii) to promptly discontinue the manufacture, sale, and distribution of the licensed products, (iii) to promptly destroy all licensed products in inventory, and (iv) not to manufacture, sell, or distribute licensed products until the expiration of the applicable last-to-expire licensed patent rights.

If the 2019 WU Agreement terminates prior to the expiration of the last-to-expire licensed patent rights, we agreed (i) to promptly discontinue the exportation of licensed products, (ii) to promptly discontinue the manufacture, sale, and distribution of the licensed products, (iii) to promptly destroy all licensed products in inventory, and (iv) not to manufacture, sell, or distribute licensed products until the expiration of the applicable last-to-expire licensed patent rights.

2020 License Agreement with Washington University

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We use these license rights in our ex vivo cell engineering platform that relies on our hypoimmune technology, including our pancreatic islet cell program.

Under the 2020 WU Agreement, we are obligated to use commercially reasonable efforts to (i) develop, manufacture, promote, and sell licensed products, and (ii) achieve certain development, regulatory, and commercial diligence milestones within specified time periods.

We are obligated to use commercially reasonable efforts to (i) develop, manufacture, promote, and sell licensed products, and (ii) achieve certain development, regulatory, and commercial diligence milestones within specified time periods.

We have the ability to extend the time periods for achievement of such milestones under certain terms set forth in the 2020 WU Agreement, including payment of extension fees.

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In addition, Washington University may terminate the 2020 WU Agreement (i) upon 30 days’ written notice if we fail to achieve certain development, regulatory, or commercial diligence milestones and are unable to resolve Washington University’s concerns through good faith negotiations in accordance with the 2020 WU Agreement, (ii) upon our bankruptcy or insolvency, or (iii) if an order is made or a notice is issued convening a meeting of our stockholders to consider the passing of a resolution of our winding up or a resolution is passed for our winding up (in each case, other than for the purpose of amalgamation or reconstruction).

If the 2020 WU Agreement terminates prior to the expiration of the last-to-expire licensed patent rights, we agree (i) to promptly discontinue the exportation of licensed products, (ii) to promptly discontinue the manufacture, sale and distribution of the licensed products, (iii) to promptly destroy all licensed products in inventory, and (iv) not to manufacture, sell, or distribute licensed products until the expiration of the applicable last-to-expire licensed patent rights.

Oscine Acquisition

In September 2020, we acquired Oscine Corp.

(Oscine), a privately-held early-stage biotechnology company pursing a glial progenitor ex vivo cell engineering program, in exchange for $8.5 million in cash, net of certain expenses.

We had originally entered into a collaboration, license, and option to purchase agreement with Oscine in November 2018.

That agreement was terminated upon the closing of our acquisition of Oscine.

As part of the Oscine acquisition, we also agreed to pay additional amounts of up to an aggregate of $225.8 million upon achievement of certain specified development and commercial milestones, which we may pay in cash or in shares of our common stock, subject to certain conditions.

In November 2024, we announced a portfolio prioritization pursuant to which we suspended development of our glial progenitor cell-based therapy program (GPC Program) and as a result, do not expect to achieve such milestone events or pay the associated milestone amounts.

As a result of the Oscine acquisition, we entered into, or obtained and amended, licenses to various technologies related to our glial progenitor cell-based therapy program, including a license agreement with University of Rochester.

License Agreement with University of Rochester

Effective as of the closing of the Oscine acquisition, we entered into an amended and restated exclusive license agreement (the Rochester Agreement) with the University of Rochester, which amended and restated a prior license agreement between Oscine and its affiliates and the University of Rochester and assigned Oscine’s rights and obligations under the prior license agreement to us.

Under the Rochester Agreement, we obtained an exclusive, royalty-bearing, sublicensable, worldwide license under certain patents, and a non-exclusive, royalty-free license under know-how, to research, develop, import, make, have made, use, sell, offer to sell, commercialize, and otherwise exploit cell-based therapies for the treatment of human central nervous system disease and disorders.

Historically, we used these license rights in the development of our GPC Program.

Our suspension of development of the GPC Program resulted in a termination of the Rochester Agreement and reversion to the University of Rochester of the rights granted to us thereunder.

If the 2020 WU Agreement terminates prior to the expiration of the last-to-expire licensed patent rights, we agreed (i) to promptly discontinue the exportation of licensed products, (ii) to promptly discontinue the manufacture, sale and distribution of the licensed products, (iii) to promptly destroy all licensed products in inventory, and (iv) not to manufacture, sell, or distribute licensed products until the expiration of the applicable last-to-expire licensed patent rights.

License Agreement with FCDI

In February 2021, we entered into a non-exclusive license and development agreement (as amended, the FCDI Agreement) with FUJIFILM Cellular Dynamics, Inc.

(FCDI), pursuant to which we obtained non-exclusive rights and a license under certain intellectual property rights controlled by FCDI (including intellectual property rights owned by FCDI and patent rights in-licensed from the Wisconsin Alumni Research Foundation) to research, develop, make, have made, use, have used, sell, offer for sale, import, and otherwise exploit human cell therapy products derived from certain iPSC lines for the treatment or prevention of certain diseases.

Pursuant to the FCDI Agreement, we agreed to pay FCDI an upfront fee of $1.0 million, annual license maintenance fees, and license fees of up to $500,000 per indication for one certain cell type or up to $350,000 per indication for certain other cell types.

We are required to pay FCDI up to an aggregate of $28.5 million per indication upon the achievement of certain specified development and regulatory milestones for up to a total of three indications and up to an aggregate of $14.25 million in specified development and regulatory milestones for each additional indication.

We are also required to pay up to an aggregate of $8.8 million per product upon the achievement of certain specified commercial milestones.

In addition, we are obligated to pay royalties on worldwide annual net sales of the relevant products in the low- to mid-single digits, which obligation shall commence upon the first commercial sale of a relevant product and shall expire after 15 years on a product-by-product and country-by-country basis.

The royalty rates are also subject to reduction upon certain other events.

The FCDI Agreement will continue until terminated in accordance with its terms.

FCDI may terminate the FCDI Agreement upon giving written notice if we fail to make any payment due or upon our material breach, subject, in each case, to our ability to dispute or cure such breach.

We may terminate the FCDI Agreement for convenience upon prior written notice, and either party may terminate upon giving written notice in the event of the other party’s bankruptcy.

License Agreement with Beam

In October 2021, we entered into an option and license agreement (as amended, the Beam Agreement) with Beam, pursuant to which Beam granted us a non-exclusive license to use Beam’s proprietary CRISPR Cas12b nuclease editing technology for a specified number of gene editing targets to research, develop, and commercialize engineered cell therapy products that (i) are directed to certain antigen targets, with respect to our allogeneic T cell programs, or (ii) comprise certain human cell types, with respect to our stem cell-derived programs.

In October 2021, we entered into an option and license agreement (as amended, the Beam Agreement) with Beam Therapeutics, Inc.

(Beam), pursuant to which Beam granted us a non-exclusive license to use Beam’s proprietary CRISPR Cas12b nuclease editing technology for a specified number of gene editing targets to research, develop, and commercialize engineered cell therapy products that (i) are directed to certain antigen targets, with respect to allogeneic T cell products, or (ii) comprise certain human cell types, with respect to stem cell-derived products.

We are permitted to use the CRISPR Cas12b system to modify or introduce, ex vivo , selected genetic sequences with respect to licensed products.

The Beam Agreement excludes any rights to base editing using the CRISPR Cas12b system.

Pursuant to the Beam Agreement, we originally had the option, for a period of one year from the effective date of the Beam Agreement, to select additional antigen targets, with respect to our allogeneic T cell programs, or human cell types, with respect to our stem cell-derived programs, in each case, upon our payment of an option payment of $10 million per antigen target or cell type.

Pursuant to the Beam Agreement, we originally had the option, for a period of one year from the effective date of the Beam Agreement, to select additional antigen targets, with respect to allogeneic T cell products, or human cell types, with respect to stem cell-derived products, in each case, upon our payment of an option payment of $10.0 million per antigen target or cell type.

We subsequently amended the Beam Agreement in July 2022 to extend the term of the option period and to add certain additional rights to the scope of the license for the purpose of supporting research and development of licensed products, and amended the Beam Agreement again in March 2023 to further extend such option period.

In April 2024, we further amended the Beam Agreement to further extend such option period and increase the amount of the option payment, and we subsequently amended the Beam Agreement, effective October 2024, to replace certain antigen targets.

In addition, we may (i) until the expiration of such option period, elect to replace an antigen target, with respect to our allogeneic T cell programs, or human cell type, with respect to our stem cell-derived programs (Replacement Right) previously selected by us, and (ii) for a period of three years from the effective date of the Beam Agreement, select new gene editing targets, or replace gene editing targets previously selected by us, with respect to any licensed product (Gene Nomination Right).

In each case, our rights with respect to exercise of the option, Replacement Right, or Gene Nomination Right are subject to certain limitations.

Subject to certain limitations, (i) until the expiration of such option period, we had the right to elect to replace an antigen target, with respect to allogeneic T cell products, or human cell type, with respect to stem cell-derived products previously selected by us, and (ii) for a period of three years from the effective date of the Beam Agreement, we had the right to select new gene editing targets, or replace gene editing targets previously selected by us, with respect to any licensed product.

Pursuant to the Beam Agreement, we paid Beam an upfront payment of $50.0 million.

Additionally, with respect to each licensed product, we will be obligated to pay to Beam up to $65.0 million in specified developmental and commercial milestones.

We will also be obligated to pay to Beam an aggregate royalty, including any royalty owed by Beam to its licensor, on a licensed product-by-licensed product and country-by-country basis, in the low to mid-single-digits, subject to reduction in certain circumstances, on net sales of each licensed product until the latest of (i) the expiration of certain patents covering such licensed product in the applicable country, (ii) the date on which any applicable regulatory exclusivity, including orphan drug, new chemical entity, data or pediatric exclusivity, with respect to such licensed product expires in such country, or (iii) the 10th anniversary of the first commercial sale of such licensed product in such country.

We will also be obligated to pay to Beam an aggregate royalty, including any royalty owed by Beam to its licensor, on a licensed product-by-licensed product and country-by-country basis, in the low to mid-single-digits, subject to reduction in certain circumstances, on net sales of each licensed product until the latest of (i) the expiration of certain patents covering such licensed product in the applicable country, which we expect to occur in 2039, (ii) the date on which any applicable regulatory exclusivity, including orphan drug, new chemical entity, data or pediatric exclusivity, with respect to such licensed product expires in such country, or (iii) the 10th anniversary of the first commercial sale of such licensed product in such country.

Unless earlier terminated by either party, the Beam Agreement will expire on a licensed product-by-licensed product and country-by-country basis upon the expiration of our payment obligations with respect to each licensed product thereunder.

We may terminate the Beam Agreement in its entirety or on an antigen target-by-antigen target basis (with respect to licensed product applicable to our allogeneic T cell programs), on a cell type-by-cell type basis (with respect to licensed product applicable to our stem cell-derived programs), or on a licensed product-by-licensed product basis, in each case, upon (i) 90 days’ advance written notice, if such notice is provided prior to the first commercial sale of a licensed product, or (ii) 180 days’ advance written notice, if such notice is provided after the first commercial sale of a licensed product.

We may terminate the Beam Agreement in its entirety or on an antigen target-by-antigen target basis (with respect to allogeneic T cell licensed products), on a cell type-by-cell type basis (with respect to stem cell-derived licensed products), or on a licensed product-by-licensed product basis, in each case, upon (i) 90 days’ advance written notice, if such notice is provided prior to the first commercial sale of a licensed product, or (ii) 180 days’ advance written notice, if such notice is provided after the first commercial sale of a licensed product.

Either party may terminate the Beam Agreement with written notice for the other party’s material breach if such breaching party fails to timely cure the breach with respect to the country in which such material breach relates.

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Either party also may terminate the Beam Agreement in its entirety upon certain insolvency events involving the other party.

License Agreement with the NIH

In January 2022, we entered into a patent license agreement (the NIH Agreement) with the U.S.

Department of Health and Human Services, as represented by The National Cancer Institution, an institute of the National Institutes of Health (the NIH), pursuant to which the NIH granted to us an exclusive, worldwide, commercial license under certain patent rights related to certain fully-human anti-CD22 binders and CD22 CAR constructs comprising such binders for use in certain in vivo gene therapy and ex vivo allogeneic CAR T cell applications for B cell malignancies.

The license grant is subject to customary statutory requirements and reserved rights as required under federal law and NIH requirements.

We have the right to grant sublicenses under the licensed patent rights with the NIH’s prior consent.

Pursuant to the NIH Agreement, we paid to the NIH an upfront payment of $1.0 million.

Additionally, we will be obligated to pay to the NIH (i) up to an aggregate of $9.6 million in specified regulatory, developmental, and commercial milestone payments with respect to each licensed product, and (ii) a payment of $1.0 million upon the assignment of the NIH Agreement to an affiliate upon a change of control.

In addition, we are obligated to pay to the NIH (i) a royalty on net sales of licensed products in the low-single-digits, subject to reduction in certain circumstances, and subject to certain annual minimum royalty payments, and (ii) a percentage, ranging from the mid-single-digits to mid-teens, of revenues from sublicensing arrangements.

Additionally, if we are granted a priority review voucher by the FDA with respect to a licensed product, we will be obligated to pay to the NIH the greater of (i) $5.0 million or (ii) a percentage in the mid-single-digits of any consideration received for the sale, transfer, or lease of such priority review voucher.

We are also obligated to pay to the NIH a percentage in the low-single-digits of the consideration we receive for any assignment of the NIH Agreement to a non-affiliate.

We are obligated to use commercially reasonable efforts to exploit, and make publicly available, inventions developed by the exploitation of the licensed patent rights, including licensed products.

Unless earlier terminated by either party, the NIH Agreement will expire upon expiration of the last-to-expire valid claim in the licensed patent rights.

The NIH may terminate the Agreement with written notice for our material breach if we fail to timely cure such breach or upon certain insolvency events involving us.

In addition, the NIH may terminate or modify the NIH Agreement, at its option, if the NIH determines that such termination or modification is necessary to meet the requirements for public use specified by federal regulations issued after the effective date of the NIH Agreement, and we do not reasonably and timely satisfy these requirements.

We may terminate the NIH Agreement or any licenses in any country or territory upon 60 days’ prior written notice.

In Vivo Cell Engineering Platform

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Of the 36.4 million shares of Series A-2 convertible preferred stock issued, 12.1 million shares were contingent on the achievement of a pre-specified development milestone, which was achieved in July 2019.

Pursuant to the terms and conditions of the Cobalt acquisition agreement, we are obligated to pay to certain former Cobalt stockholders contingent consideration (Cobalt Contingent Consideration) of up to an aggregate of $500.0 million upon our achievement of certain pre-specified development milestones and a success payment (Cobalt Success Payment) of up to $500.0 million, each of which is payable in cash or stock.

Pursuant to the terms and conditions of the Cobalt acquisition agreement (the Cobalt Merger Agreement), we are obligated to pay to certain former Cobalt stockholders contingent consideration (Cobalt Contingent Consideration) of up to an aggregate of $500.0 million upon our achievement of certain pre-specified development milestones and a success payment (Cobalt Success Payment) of up to $500.0 million, each of which is payable in cash or stock.

The Cobalt Success Payment is payable if, at pre-determined valuation measurement dates, our market capitalization equals or exceeds $8.1 billion, and we are advancing a program based on the fusogen technology in a clinical trial pursuant to an IND, or have filed for, or received approval for, a biologics license application or new drug application for a product based on the fusogen technology.

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As a result of the Cobalt transaction, we obtained licenses to various technologies and intellectual property rights that relate to the development of our fusogen technology and related fusosome programs, including exclusive license agreements with Flagship Pioneering Innovations V, Inc.

(Flagship) and La Societe Pulsalys (Pulsalys), as well as several exclusive options to enter into exclusive license agreements, including one such option with The Regents of the University of California acting through The Technology Development Group of the University of California, Los Angeles (UCLA), with whom we later entered into an exclusive license agreement.

(Flagship) and La Societe Pulsalys (Pulsalys), as well as several exclusive options to enter into exclusive license agreements, including one such option with The Regents of the University of California acting through The Technology Development Group of the University of California, Los Angeles (UCLA), with which we later entered into an exclusive license agreement.

License Agreement with Flagship

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Pursuant to the Flagship Agreement, Cobalt is obligated to pay, on a Fusogen Product-by-Fusogen Product and jurisdiction-by-jurisdiction basis, royalties in the low single-digit percentage on net sales of Fusogen Products.

The Flagship Agreement will expire on the expiration of the last-to-expire royalty term, which is determined on a Fusogen Product-by-Fusogen Product and jurisdiction-by-jurisdiction basis, and occurs on the earlier of (i) the expiration of the last valid claim of any Fusogen Foundational IP covering such Fusogen Product or (ii) the date on which the last applicable additional milestone payment has been made in accordance with that certain merger agreement under which we acquired Cobalt, which we expect to be in 2039.

The Flagship Agreement will expire on the expiration of the last-to-expire royalty term, which is determined on a Fusogen Product-by-Fusogen Product and jurisdiction-by-jurisdiction basis, and occurs on the earlier of (i) the expiration of the last valid claim of any Fusogen Foundational IP covering such Fusogen Product, which we expect to occur in 2041, or (ii) the date on which the last applicable additional milestone payment has been made in accordance with the Cobalt Merger Agreement.

Upon expiration of the royalty term with respect to a Fusogen Product in any jurisdiction and payment in full of all amounts owed under the Flagship Agreement for such Fusogen Product, the license granted to us will automatically convert into a non-exclusive, fully paid-up license for such Fusogen Product in such jurisdiction.

We have the right to terminate the Flagship Agreement in its entirety for convenience upon 60 days of written notice.

We have the right to terminate the Flagship Agreement in its entirety for convenience upon 60 days' written notice.

Either party may terminate the Flagship Agreement upon a material breach by the other party that is not cured within 30 days after receiving written notice.

Also, Flagship may terminate the Flagship Agreement (i) upon 30 days’ written notice if we cease to carry on our business with respect to the rights granted in the Flagship Agreement, (ii) upon written notice if we experience an event of bankruptcy, or (iii) immediately upon written notice if we challenge the validity, patentability, or enforceability of any Fusogen Foundational IP or participate in any such challenge.

Flagship may terminate the Flagship Agreement (i) upon 30 days’ written notice if we cease to carry on our business with respect to the rights granted in the Flagship Agreement, (ii) upon written notice if we experience an event of bankruptcy, or (iii) immediately upon written notice if we challenge the validity, patentability, or enforceability of any Fusogen Foundational IP or participate in any such challenge.

Sublicense Agreement with Pulsalys

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Lastly, we are obligated to pay percentage annual fees on certain sublicense income in the low single-digits.

The Pulsalys Agreement will expire on a country-by-country and licensed product-by-licensed product basis upon the expiration of the last-to-expire valid claim within the licensed patent rights covering the making, using, sale, and import of such licensed product in such country or any patent term extension or supplementary protection certificate thereof covering the sale of such licensed product in such country, which we expect to occur in 2037.

The Pulsalys Agreement will expire on a country-by-country and licensed product-by-licensed product basis upon the expiration of the last-to-expire valid claim within the licensed patent rights covering the making, using, sale, and import of such licensed product in such country which we expect to occur in 2039, or any patent term extension or supplementary protection certificate thereof covering the sale of such licensed product in such country.

We also have the right to terminate the Pulsalys Agreement in its entirety upon notice if we determine, in our sole discretion, that continued pursuit of development of the licensed patent rights is not feasible or desirable in the context of (i) the resources available to us or due to external factors such as competition, market forces, or access or license to other reasonably useful intellectual property, or (ii) a change of direction of our business focus.

Either party may terminate the Pulsalys Agreement upon a material breach by the other party that is not cured within 90 days after receiving written notice thereof.

Pulsalys may terminate the Pulsalys Agreement (i) in full in the case of we undergo a cessation of business, dissolution or voluntary liquidation, or (ii) in full or in part (x) if we challenge the validity of the licensed patents, provided that such termination will be with respect to the claims within the licensed patents that are the subject of such challenge, or (y) if we fail to achieve the diligence milestones, and if the parties have not extended such milestones after good faith negotiations, and subject to our ability to cure such failure within 90 days after notice of the same.

Pulsalys may terminate the Pulsalys Agreement (i) in full if we undergo a cessation of business, dissolution or voluntary liquidation, or (ii) in full or in part (x) if we challenge the validity of the licensed patents, provided that such termination will be with respect to the claims within the licensed patents that are the subject of such challenge, or (y) if we fail to achieve the diligence milestones, and if the parties have not extended such milestones after good faith negotiations, and subject to our ability to cure such failure within 90 days after notice of the same.

License Agreement with UCLA

In March 2019, we entered into a license agreement (as amended, the UCLA Agreement) with UCLA, upon the exercise of an option originally granted by UCLA to Cobalt in April 2018.

In March 2019, we entered into a license agreement (as amended, the UCLA Agreement) with UCLA, pursuant to the exercise of an option originally granted by UCLA to Cobalt in April 2018.

Under the UCLA Agreement, UCLA granted us an exclusive, sublicensable, transferable (subject to certain conditions) license in the licensed territory in the field of human therapeutics under certain patent rights relating to certain virus envelope pseudotyped lentiviruses and methods of their use to (i) research, make, have made, use, sell, offer for sale, have sold, and import licensed products and (ii) practice licensed methods for the purposes of researching, manufacturing, and using licensed products, but not to perform services for a fee.

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We use the rights granted under the UCLA Agreement in our in vivo fusogen platform and related fusosome programs.

We are obligated to use commercially reasonable and diligent efforts to (i) develop licensed products, (ii) market licensed products, and (ii) manufacture and sell licensed products in quantities sufficient to meet market demand.

We are obligated to use commercially reasonable and diligent efforts to (i) develop licensed products, (ii) market licensed products, and (iii) manufacture and sell licensed products in quantities sufficient to meet market demand.

We are also required to satisfy certain development and commercial milestones with respect to at least one licensed product that is administered directly to a patient for therapeutic purposes.

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We are also required to pay, on a country-by-country basis, earned royalty percentages in the low single-digits on net sales of the licensed products, with the royalty rate being subject to reduction upon certain events.

Under the UCLA Agreement, we are obligated to pay a minimum annual royalty of $100,000 beginning with the first full calendar year after the first commercial sale of a licensed product, and the minimum annual royalty will be credited against the earned royalty made during the same calendar year.

We are obligated to pay a minimum annual royalty of $100,000 beginning with the first full calendar year after the first commercial sale of a licensed product, and the minimum annual royalty will be credited against the earned royalty made during the same calendar year.

If any claim within the licensed patent rights is held invalid or unenforceable in a final decision by a court of competent jurisdiction, all royalty obligations with respect to that claim or any claim patentably indistinct from it will expire as of the date of that final decision.

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If such challenge fails, we are required to pay two times the royalty rate paid during the period of such challenge for the remaining term of the UCLA Agreement and all of UCLA’s verifiable legal out-of-pocket fees and costs incurred in defending against such challenge, including attorney’s fees.

The UCLA Agreement will expire on the later of the expiration of the last-to-expire patent or last to be abandoned patent application in the licensed patent rights, which we expect to occur in 2033.

The UCLA Agreement will expire on the later of the expiration of the last-to-expire patent in the licensed patent rights, which we expect to occur in 2033, or the last to be abandoned patent application in the licensed patent rights.

We also have the right to terminate the UCLA Agreement in its entirety or with respect to any portion of the licensed patent rights for any reason upon 90 days’ prior written notice to UCLA.

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however, this right is not available if the UCLA Agreement is terminated for any other cause.

License Agreement with the NIH

In January 2022, we entered into a patent license agreement (the NIH Agreement) with the U.S.

The license grant is subject to customary statutory requirements and reserved rights as required under federal law and NIH requirements.

We have the right to grant sublicenses under the licensed patent rights with the NIH’s prior consent.

Pursuant to the NIH Agreement, we paid to the NIH an upfront payment of $1.0 million.

In addition, we are obligated to pay to the NIH (a) a royalty on net sales of licensed products in the low-single-digits, subject to reduction in certain circumstances, and subject to certain annual minimum royalty payments, and (b) a percentage, ranging from the mid-single-digits to mid-teens, of revenues from sublicensing arrangements.

Additionally, if we are granted a priority review voucher by the FDA with respect to a licensed product, we will be obligated to pay to the NIH the greater of (x) $5.0 million or (y) a percentage in the mid-single-digits of any consideration received for the sale, transfer, or lease of such priority review voucher.

We are also obligated to pay to the NIH a percentage in the low-single-digits of the consideration we receive for any assignment of the NIH Agreement to a non-affiliate.

We are obligated to use commercially reasonable efforts to exploit, and make publicly available, inventions developed by the exploitation of the licensed patent rights, including licensed products.

Unless earlier terminated by either party, the NIH Agreement will expire upon expiration of the last-to-expire valid claim in the licensed patent rights, which we expect to occur in 2041.

The NIH may terminate the Agreement with written notice for our material breach if we fail to timely cure such breach or upon certain insolvency events involving us.

We may terminate the NIH Agreement or any licenses in any country or territory upon 60 days’ prior written notice.

Government Regulation

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The FDA may delay or refuse approval of a BLA if applicable regulatory criteria are not satisfied, require additional testing or information, and/or require post-marketing testing and surveillance to monitor safety or efficacy of a product.

The FDA’s decision to release in “real-time” newly issued CRLs associated with withdrawn or abandoned applications, if applicable to any of our product candidates, could materially impact our business and competitive advantage.

If regulatory approval of a product is granted, such approval will be granted for particular indications and may entail limitations on the indicated uses for which such product may be marketed.

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Expedited Development and Review Programs

The FDA offers a number of expedited development and review programs for qualifying product candidates.

The FDA offers a number of expedited development and review programs for qualifying product candidates, including priority review, fast track, breakthrough therapy, accelerated approval, and national priority voucher programs, although the FDA’s policies and implementation of these and similar programs are subject to change.

For example, the fast track program is intended to expedite or facilitate the process for reviewing new products that are intended to treat a serious or life-threatening disease or condition and demonstrate the potential to address unmet medical needs for the disease or condition.

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In particular, for a diagnostic, a PMA application typically requires data regarding analytical and clinical validation studies.

As part of the PMA review, the FDA will typically inspect the manufacturer’s facilities for compliance with the Quality System Regulation (QSR), which imposes elaborate testing, control, documentation, and other quality assurance requirements.

The FDA issued a final rule in February 2024 replacing the QSR with the Quality Management System Regulation (QMSR), which incorporates by reference the quality management system requirements of ISO 13485:2016.

The FDA has stated that the standards contained in ISO 13485:2016 are substantially similar to those set forth in the existing QSR.

The FDA will begin to enforce the QMSR requirements upon the QMSR effective date of February 2, 2026.

As part of the PMA review, the FDA will typically inspect the manufacturer’s facilities for compliance with the Quality Management System Regulation (QMSR), which went into effect in February 2026, replaces the former Quality System Regulation, imposes testing, control, documentation, and other quality assurance requirements, and incorporates by reference the quality management system requirements of ISO 13485:2016.

Approval of a PMA submission is not guaranteed, and the FDA may ultimately respond to a PMA submission with a not approvable determination based on deficiencies in the application and require additional clinical trial or other data that may be expensive and time-consuming to generate and that could substantially delay approval.

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Various industry stakeholders, including certain pharmaceutical companies and the Pharmaceutical Research and Manufacturers of America, have initiated lawsuits against the federal government asserting that the price negotiation provisions of the IRA are unconstitutional.

The impact of these judicial challenges and any future healthcare measures and agency rules, including those implemented by the new presidential administration, on us and the pharmaceutical industry as a whole is unclear.

Further, the current administration has issued executive orders focused on decreasing prescription drug prices, including directing the Secretary of HHS to establish a mechanism through which American patients can buy drugs directly from manufacturers who sell at a most-favored-nation price and directing the United States Trade Representative and Secretary of Commerce to take action to ensure foreign countries are not engaged in practices that purposefully and unfairly undercut market prices and drive price hikes in the United States.

In November 2025, CMS announced a voluntary initiative called the GENEROUS Model (GENErating cost Reductions fOr U.S.

Medicaid Model) to introduce the option of most-favored-nation pricing to the Medicaid program, whereby a drug manufacturer may voluntarily offer supplemental rebates to participating state Medicaid programs for a manufacturer’s covered outpatient drugs.

Government agreements with pharmaceutical companies and other measures that use most-favored-nation pricing targets for prescription drugs or that increase generic and biosimilar drug entry sooner than expected could have a material adverse effect on our industry, ability to set adequate pricing for new drugs to recover research and development costs, ability to attract potential investors and potential buyers in the future, or the pricing of our approved product in the United States and in foreign countries.

The impact of these and any future healthcare measures, executive orders, and agency rules implemented by the current administration on us and the pharmaceutical industry as a whole is unclear.

The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability, or commercialize our product candidates, if approved.

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On December 13, 2021, Regulation 2021/2282 on Health Technology Assessment (HTA) amending Directive 2011/24/EU (the Regulation), was adopted.

Although the Regulation entered into force in January 2022, from January 31, 2025, or the end of the transition period, any trials approved under the Clinical Trials Directive that continue running must comply with the Regulation, and their sponsors must enter information regarding the trials in the Clinical Trials Information System.

The Regulation intends to boost cooperation among EU member states in assessing health technologies, including new medicinal products, and providing the basis for cooperation at the EU level for joint clinical assessments in these areas.

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Our human capital resources objectives include, as applicable, identifying, recruiting, retaining, incentivizing, and integrating our existing and additional employees.

The principal purposes of our equity incentive plans are to attract, retain, and motivate selected employees, consultants, and directors through the granting of stock-based compensation awards and, with respect to our employees, cash-based performance bonus awards.

In November 2024, we announced a portfolio prioritization to prioritize clinical and preclinical development in type 1 diabetes, B-cell mediated autoimmune diseases, refractory B-cell malignancies, and the fusogen platform for generating in vivo CAR T cells.

We suspended development of SC291, our HIP-modified CD19 allogeneic CAR T therapy, in oncology and SC379, our glial progenitor cell program, as we seek partnerships for these programs.

We anticipate that the portfolio update and associated workforce reduction will be substantially complete in the first quarter of 2025, after which we expect to have approximately 160 employees.

The principal purposes of our equity incentive and bonus plans are to attract, retain, and motivate selected employees, consultants, and directors through the granting of stock-based compensation awards and, with respect to our employees, cash-based performance bonus awards.

Our Corporate Information

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This uncertainty exposes us to unforeseen risks, makes it difficult for us to predict the time and cost that will be required for the development and potential regulatory approval of our product candidates, and increases the risk that we may ultimately not be successful in our efforts to use and expand our technology platforms to build a pipeline of product candidates.

A key element of our strategy is to identify and develop a broad pipeline of product candidates using our ex vivo and in vivo cell engineering platforms and advance those product candidates through clinical development for the treatment of various different diseases.

A key element of our strategy is to identify and develop a pipeline of product candidates using our ex vivo and in vivo cell engineering platforms and advance those product candidates through clinical development for the treatment of various different diseases.

The scientific research that forms the basis of our efforts to develop product candidates with our platforms is still ongoing.

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Also, we are in the early stages of testing product candidates developed using our cell engineering platforms in humans, and most of our current data are limited to animal models and preclinical cell lines and assays, which may not accurately predict the safety and efficacy of our product candidates in humans.

Additionally, we and third parties may have limited preclinical and clinical data, and a more limited understanding generally, with respect to certain indications, including autoimmune diseases, and we cannot predict the extent to which the safety and efficacy of a product candidate may vary across indications.

Additionally, we and third parties may have limited preclinical and clinical data, and a more limited understanding generally, with respect to certain indications, such as autoimmune diseases, and we cannot predict the extent to which the safety and efficacy of a product candidate may vary across indications.

We may encounter significant challenges creating appropriate models and assays for evaluating the safety and purity of our product candidates and may not be able to provide sufficient data or other evidence, to the satisfaction of regulatory authorities, that certain unexpected results observed in preclinical and clinical testing of our product candidates are not indicative of the potential safety issues of such product candidates.

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Accordingly, it may be difficult for us to conduct the level of testing and assay development necessary to ensure that our PSC-derived cell product candidates have an acceptable safety profile when used in humans.

These risks related to genetic variation are also relevant to our product candidates created from donor-derived cells.

These risks related to genetic variation are also relevant to any product candidates we may develop using donor-derived cells.

Additionally, our stem cell-based product candidates have potential safety risks that may result from cells that are undifferentiated or have not been completely differentiated to the desired phenotype and lead to oncogenic transformations or other adverse effects.

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For example, even if we obtain human data to support continued evaluation and approval of our product candidates, the FDA or comparable foreign regulatory authorities may lack experience in evaluating the safety and efficacy of therapeutics similar to our product candidates or may scrutinize such data more closely than data generated from more established types of biological products.

In addition, given that there are no approved PSC- or donor-derived cell therapy products on the market, the FDA and comparable foreign regulatory authorities have not established consistent standards by which to evaluate the safety of such products, and any such standards that they do establish may subsequently change.

In addition, given that there are no approved PSC-derived cell therapy products on the market, the FDA and comparable foreign regulatory authorities have not established consistent standards by which to evaluate the safety of such products, and any such standards that they do establish may subsequently change.

Moreover, the FDA remains focused on potential safety issues associated with gene and cell therapy products, and as the number of new gene and cell therapy product candidates submitted for FDA review has increased in recent years, the number of clinical holds imposed by the FDA has also increased.

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In addition, the evaluation process for our product candidates will take time and resources and may require independent third-party analyses, and our product candidates may ultimately not be accepted or approved by the FDA or comparable foreign regulatory authorities.

As such, even if we are successful in building our pipeline of product candidates from our ex vivo and in vivo cell engineering platforms, we cannot be certain that such efforts will lead to the development of approvable or marketable products, either alone or in combination with other therapies.

In response to reports of T cell malignancies in patients that previously received chimeric antigen receptor (CAR) T cell immunotherapies, the FDA announced in November 2023 that it is investigating the risk of secondary cancers and the need for regulatory action for such therapies as a class and has advised of new patient monitoring and reporting requirements with respect to such therapies.

As such, even if we are successful in building a pipeline of product candidates from our ex vivo and in vivo cell engineering platforms, we cannot be certain that such efforts will lead to the development of approvable or marketable products, either alone or in combination with other therapies.

In response to reports of T cell malignancies in patients that previously received chimeric antigen receptor (CAR) T cell immunotherapies, the FDA announced in November 2023 its investigation into the risk of secondary cancers and the need for regulatory action for such therapies as a class and advised of new patient monitoring and reporting requirements with respect to such therapies.

In January 2024, the FDA imposed a class-wide boxed warning requirement regarding the occurrence of T cell malignancies for all approved CAR T therapies.

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However, all currently approved CAR T cell immunotherapies are approved only in oncology indications, and there can be no assurance that the FDA or comparable foreign regulatory authorities will reach the same risk-benefit determination in other indications, such as autoimmune diseases.

We have received and may in the future receive FDA correspondence requesting updates to certain of our CAR T cell clinical trials to address these developments.

It is unclear at this time how changes in the leadership of the FDA and other actions under the new presidential administration will impact our operations and future interactions with the FDA.

To the extent the FDA views in vivo CAR T cell therapies as posing similar or additional risks to those posed by the ex vivo CAR T therapies that were the subject of these FDA actions, the FDA may require us to take certain actions in connection with any in vivo CAR T cell clinical trials we may conduct or we may otherwise receive correspondence from the FDA regarding these developments.

It is unclear at this time how changes in the leadership of the FDA and other government administration actions and changes will impact our operations and future interactions with the FDA.

Additionally, we and our product candidates may be subject to further regulatory actions or requirements of the FDA or comparable foreign regulatory authorities relating to these therapies, such as requiring a black box warning or other labeling disclosures for any approved products.

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To date, we have not generated revenue from sales of any products, and we may never be able to develop, obtain regulatory approval for, or commercialize a marketable product.

Before we generate any revenue from product sales of any of our current or potential future product candidates, we will need to manage preclinical, clinical, and manufacturing activities, including undertaking significant clinical development, obtain regulatory approval in multiple jurisdictions, establish manufacturing supply, including commercial manufacturing supply, and build a commercial organization, which will require substantial investment and significant marketing efforts.

Before we generate any revenue from product sales of any of our current or potential future product candidates, we will need to manage research, preclinical, clinical, and manufacturing activities, including undertaking significant clinical development, obtain regulatory approval in multiple jurisdictions, establish manufacturing supply, including commercial manufacturing supply, and build a commercial organization, which will require substantial investment and significant marketing efforts.

We may never receive regulatory approval for any of our product candidates, which would prevent us from marketing, promoting, or selling any of our product candidates and generating revenue.

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• our successful and timely completion of preclinical studies and clinical trials for which the FDA and any comparable foreign regulatory authorities agree with the design, endpoints, and implementation;

• the sufficiency of our financial and other resources to complete the necessary preclinical studies and clinical trials;

• the sufficiency of our financial and other resources to complete the necessary preclinical studies and clinical trials and manufacturing activities necessary to support such studies and trials;

• the timely receipt of regulatory approvals or authorizations to conduct clinical trials;

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• the timely receipt of marketing approvals for our product candidates from applicable regulatory authorities, including the impact of any changes to the FDA’s Accelerated Approval Program;

• our ability to address any potential interruptions or delays resulting from external factors, including those related to the current global geo-political, business, and economic environment, including any changes resulting from the new presidential administration;

• the extent of any clinical or regulatory setbacks experienced by other companies developing similar products or within adjacent fields, including autologous and allogeneic cell-based therapies and the fields of gene editing and gene therapy, or publications or press coverage related to such therapies and fields, which could negatively impact the perceptions of the value and risk of our product candidates and technologies;

• the extent of any clinical or regulatory setbacks experienced by other companies developing similar products or within adjacent fields, including cell-based therapies and the fields of gene editing and gene therapy, or publications or press coverage related to such therapies and fields, which could negatively impact the perceptions of the value and risk of our product candidates and technologies;

• the extent of any post-marketing approval commitments we may be required to make to applicable regulatory authorities, including the conduct of any post-marketing approval clinical studies, and our ability to comply with any such commitments;

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• challenges integrating acquired businesses into our business, including our existing operations and culture.

For example, in October 2023, we underwent a portfolio prioritization pursuant to which we updated our portfolio to increase our focus on our ex vivo cell therapy product candidates and reduce our near-term investment in our fusogen platform.

As part of this reduction, we shifted our focus on fusogen to research activities.

We expect to encounter increased costs and difficulties if and as we expand preclinical development and initiate clinical development for product candidates derived from our fusogen platform, including those related to scaling up and driving forward clinical development and manufacturing activities.

As a result, there is increased risk that the benefits we expected from the fusogen platform at the time of the Cobalt acquisition may be more expensive and difficult to obtain or may not occur at all.

Further, in November 2024, we underwent a portfolio prioritization pursuant to which we suspended development of our glial progenitor cell program, which we previously acquired from Oscine Corp.

(Oscine), and are seeking partnership or spin-out opportunities for this program.

We may encounter challenges in identifying and executing on such opportunities, which increases the risk that the benefits we expected from the glial progenitor cell program at the time of the Oscine acquisition may be less than we anticipated or may not occur at all.

For example, we have conducted several portfolio prioritizations to consolidate our resource allocation to fewer programs, resulting in, among other things, workforce reductions.

Most recently, we conducted a portfolio prioritization to prioritize future development of SC451, our type 1 diabetes program, and programs enabled by our fusogen platform, and suspended development of and further internal investment in our two allogeneic cell therapy CAR T programs.

Furthermore, we regularly evaluate our portfolio and may conduct further portfolio prioritizations in the future, which could result in the suspension, discontinuation, or divestiture of certain programs that are our current focus of development, which increases the risk that the benefits we expected from any acquired technologies, such as the fusogen platform, may be more expensive and difficult to obtain or may not occur at all.

In addition, foreign acquisitions and licensing arrangements are subject to additional risks, including those related to integration of operations across different cultures and languages, currency risks, potentially adverse tax consequences of overseas operations, and the particular economic, political, regulatory, and compliance risks associated with specific countries.

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Therefore, for certain of our product candidates or technologies, including those that we may develop in the future, we may decide to form or seek strategic alliances, collaborations, or similar arrangements with pharmaceutical or biotechnology companies or other third parties that we believe will complement or augment our development and potential commercialization efforts with respect to such product candidates, including in territories outside the United States or for certain indications.

We may also pursue joint ventures or investments in complementary businesses that align with our strategy.

We may also pursue alternative strategies or relationships, such as spin-outs, joint ventures, or investments in complementary businesses that align with our strategy, which may pose risks similar to those described elsewhere in these Risk Factors with respect to collaborations, as well as additional risks unique to these types of relationships.

To the extent we enter into strategic relationships involving parties located outside the United States, we are subject to similar risks to those described elsewhere in these Risk Factors with respect to foreign acquisitions and licensing arrangements.

We face significant competition in seeking appropriate collaborators.

We face significant challenges, including competition in seeking appropriate collaborators.

Collaborations are complex and time-consuming to negotiate and document.

We may not be successful in our efforts to establish a collaboration or other alternative arrangements for our product candidates or technologies on acceptable terms or at all, including because our product candidates or technologies may be deemed to be at too early of a stage of development for collaborative effort or third parties may not view our product candidates as having the requisite potential to demonstrate success in clinical trials and ultimately obtain regulatory approval.

We may incur costs to continue developing one or more of our product candidates or technologies to establish or support an appropriate collaboration, which costs may outweigh the benefit of any such collaboration, if we are able to enter into a collaboration at all.

Additionally, there have been a significant number of recent business combinations among large pharmaceutical companies that have reduced the number of potential future collaborators and changed the strategies of the resulting combined companies.

If and when we collaborate with a third party for development and commercialization of a product candidate, we expect that we may have to relinquish some or all of the control over the future success of that product candidate to the third party.

In addition, under the terms of certain license agreements applicable to our product candidates and technologies, we may be restricted from entering into collaboration or similar agreements relating to those product candidates or technologies on certain terms or at all, and when we collaborate with a third party for development and commercialization of a product candidate, we expect that we may have to relinquish some or all of the control over the future success of that product candidate to the third party.

Our ability to reach a definitive agreement for a collaboration will depend, among other things, upon our assessment of the collaborator’s resources and expertise, the terms and conditions of the proposed collaboration, and the proposed collaborator’s evaluation of our technologies, product candidates, and market opportunities.

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Moreover, our initial estimates of the potential revenue we are eligible to receive under our strategic collaborations may include potential payments related to therapeutic programs for which our collaborators may discontinue development.

If we are unable to enter into strategic collaborations, or if any of the other events described in this Risk Factor occur after we enter into a collaboration, we may have to curtail the development of a particular product candidate, reduce or delay the development program for such product candidate or one or more of our other product candidates, delay its potential commercialization or reduce the scope of our sales or marketing activities, or increase our expenditures and undertake development or commercialization activities at our own expense.

If we are unable to enter into strategic collaborations, or if any of the other events described in this Risk Factor occur after we enter into a collaboration, we may have to curtail the development of a particular product candidate, reduce the scope of or delay the development program for such product candidate or one or more of our other product candidates, delay its potential commercialization or reduce the scope of our sales or marketing activities, or increase our expenditures and undertake development or commercialization activities at our own expense.

If we elect to increase our expenditures to fund development or commercialization activities on our own, we may need to obtain additional capital, which may not be available to us on acceptable terms or at all.

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As we continue developing our product candidates and building our pipeline, we will require personnel with medical, scientific, or technical qualifications and expertise specific to each program.

The loss of key management and senior scientists or other personnel could delay our research and development activities.

The loss of key management and senior scientists or other personnel could delay or otherwise impact our research and development activities, for example, through loss of institutional knowledge, capabilities, or subject matter expertise.

In addition, the loss of key executives could disrupt our operations and our ability to conduct our business.

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We have from time to time experienced, and we expect to continue to experience, difficulty in hiring and retaining qualified employees on acceptable terms, or at all.

Many of the companies with which we compete for experienced personnel may have greater resources than we do and may be able to provide prospective job candidates or our existing employees with more attractive roles, salaries, or benefits than we can provide.

For example, the United States government has announced changes to the H-1B visa program, including a new one-time $100,000 fee for new H-1B petitions, and plans to take further steps to reform the H-1B program.

These or other changes to the H-1B program or the requirements for other visas could increase our costs, limit the flow of technical and professional talent into the United States, or otherwise harm our ability to recruit and retain qualified personnel who are critical to our business.

In addition, many of the companies with which we compete for experienced personnel may have greater resources than we do and may be able to provide prospective job candidates or our existing employees with more attractive roles, salaries, or benefits than we can provide.

If we hire employees from competitors or other companies, their former employers may attempt to assert that these employees or we have breached legal obligations, including non-solicitation or non-compete obligations, which may result in a diversion of our time and resources and, potentially, damages.

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If the perceived benefits of our stock awards decline or are otherwise viewed unfavorably compared to those of companies with which we compete for talent, or if we or our prospects are otherwise viewed unfavorably, this could negatively impact our ability to recruit, motivate, and retain highly skilled employees.

We announced portfolio prioritizations in each of November 2022, October 2023, and November 2024, pursuant to which we conducted reductions in our workforce.

Reductions in our workforce may result in attrition beyond our planned reduction in workforce, reduced employee morale and negative publicity, which may damage our reputation and make it more difficult for us to retain and motivate our current personnel as well as attract new personnel.

In November 2025, we conducted a portfolio prioritization to prioritize development of our SC451 and SG293 programs, and suspended development of and further internal investment in our two allogeneic cell therapy CAR T programs – SC291 in B-cell mediated autoimmune diseases and SC262 in oncology.

Further, we previously conducted several portfolio prioritizations pursuant to which we implemented reductions in our workforce.

Portfolio prioritizations and any associated reductions in our workforce may result in attrition beyond any planned reduction in workforce, reduced employee morale, and negative publicity, which may damage our reputation and make it more difficult for us to retain and motivate our current personnel as well as attract new personnel.

These workforce reductions have also caused us to lose institutional knowledge, capabilities, and subject matter expertise and could negatively affect our efforts to obtain and maintain our intellectual property rights in the event we are unable to identify inventions made or identify or recreate the necessary scientific records or data.

Any of the foregoing could significantly harm our business and future growth prospects.

Though many of our personnel have significant experience with respect to manufacturing biopharmaceutical products, we, as a company, do not have experience in developing or maintaining a manufacturing facility.

Though many of our personnel have significant experience with respect to manufacturing biopharmaceutical products, we, as a company, do not have experience maintaining a manufacturing facility.

For any manufacturing facility that we may develop or maintain, we cannot guarantee that we will be able to maintain a compliant facility and manufacture our product candidates as intended, given the complexity of manufacturing novel therapeutics.

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The manufacture of biopharmaceutical products is complex and requires significant expertise, including the development of advanced manufacturing techniques and process controls.

Manufacturers of cell and gene therapy products often encounter difficulties in production, particularly in scaling up, scaling out, validating initial production, ensuring the absence of contamination, and ensuring process robustness after initial production.

Manufacturers of cell and gene therapy products often encounter difficulties in production, particularly in scaling up, scaling out, validating initial production, ensuring product quality and the absence of contamination, and ensuring process robustness after initial production.

These include difficulties with production costs and yields, quality control, including stability of the product, quality assurance testing, operator error, and shortages of qualified personnel, as well as compliance with strictly enforced federal, state, and foreign regulations.

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Any of the foregoing could lead to delays in or an inability to successfully manufacture our product candidates at the scale required for the development and potential commercialization of our product candidates.

We have invested in building world class capabilities in key areas of manufacturing sciences and operations, including development of our cell engineering platforms, product characterization, and process analytics.

Our investments also include scaled research solutions, scaled infrastructure, and novel technologies to improve efficiency, characterization, and scalability of manufacturing.

We have invested in building world class capabilities in key areas of manufacturing sciences, operations, and quality, including development of our cell engineering platforms, product characterization, and process analytics.

Our investments also include scaled research solutions, scaled infrastructure, and novel technologies to improve efficiency, characterization, quality, and scalability of manufacturing.

However, we have limited experience in managing the manufacturing processes necessary for making cell and gene therapies.

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We currently rely, and expect we will continue to rely, on CDMOs to manufacture our product candidates for preclinical studies and clinical trials.

For any manufacturing facility we may develop, it may take us longer to establish and operationalize such facility than we originally anticipated, which could delay our ability to begin manufacturing certain of our product candidates internally, extend the period of time during which we must solely rely on CDMOs for the manufacture of such product candidates, and result in a delay to our clinical development timelines.

In order to begin manufacturing activities at any manufacturing facility that we may operate, we may be required to transition manufacturing processes and know-how for certain of our product candidates from our other facilities or our CDMOs to such facility.

In order to begin manufacturing activities at any manufacturing facility that we may operate, we may be required to transfer manufacturing processes and know-how for certain of our product candidates from our other facilities or our CDMOs to such facility.

To date, we and our CDMOs have limited experience in the technology transfer of manufacturing processes.

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We experienced rapid growth following our inception in July 2018.

However, as described elsewhere in these Risk Factors, we undertook workforce reductions as part of our November 2022, October 2023, and November 2024 restructurings.

These workforce reductions may yield unintended consequences and costs, including difficulty retaining and motivating remaining employees, difficulty attracting and hiring qualified employees, and increased reliance on third parties if needed to support our internal capabilities.

Despite our workforce reductions, if we have success in our initial clinical trials and expand our research and development efforts, we may experience future growth in the scope of our operations, particularly if and as we advance our product candidates into and through IND-enabling studies and clinical trials and continue to establish and develop our regulatory, quality, and clinical operations and supply chain logistics and manufacturing.

However, as described elsewhere in these Risk Factors, we undertook workforce reductions as part of our past restructurings, and in November 2025, conducted a portfolio prioritization to prioritize development of our SC451 and SG293 programs and suspended development of and further internal investment in our two allogeneic cell therapy CAR T programs.

These events may yield unintended consequences and costs, including difficulty retaining and motivating remaining employees, difficulty attracting and hiring qualified employees, and increased reliance on third parties if needed to support our internal capabilities.

Despite our workforce reductions, if we have success in our future clinical trials and expand our research and development efforts, we may experience future growth in the scope of our operations, particularly if and as we advance our product candidates into and through IND-enabling studies and clinical trials and continue to establish and develop our regulatory, quality, and clinical operations and supply chain logistics and manufacturing.

To manage our growth, we have implemented and improved, and plan to continue to implement and improve, our managerial, operational, and financial systems, and continue to recruit and train additional qualified personnel if and as we grow.

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Our resource allocation decisions may cause us to fail to capitalize on viable commercial products or profitable market opportunities.

Additionally, we may be required to invest our resources in a limited number of more advanced programs with higher probabilities of success in the shorter term and, consequently, to reduce our investment in promising earlier stage programs.

Such decisions would require us to reduce the breadth and diversity of our product portfolio, which could potentially limit the long-term growth of our pipeline and subject us to greater risk that the failure of any such programs would harm our prospects.

Additionally, we have been and may continue to be required to limit our investment of resources to certain programs in our portfolio that we believe have higher probabilities of success and, consequently, to reduce our investment in other potentially promising programs.

Such decisions have required and would in the future require us to reduce the breadth and diversity of our product portfolio, which could potentially limit the long-term growth of our pipeline and subject us to greater risk that the failure of any such programs would harm our prospects.

Our spending on current and future research and development programs, therapeutic platforms, and product candidates for specific indications may not yield any commercially viable products.

If we do not accurately evaluate the commercial potential or target market for a particular product candidate or otherwise decide to cease development of a product candidate, we may relinquish valuable rights to that product candidate through collaboration, licensing, royalty, or other arrangements in cases in which it would have been more advantageous for us to retain sole development and commercialization rights.

The use of human stem cells exposes us to a number of risks in the development of our human stem cell-derived products, including inability to obtain suitable donor material from eligible and qualified human donors, restrictions on the use of human stem cells, as well as the ethical, legal, and social implications of research on the use of stem cells, any of which could prevent us from completing the development of or commercializing and gaining acceptance for our products derived from human stem cells.

We use human stem cells in our research and development, including induced PSCs (iPSCs) and embryonic stem cells (ESCs), and one or more of our ex vivo cell engineering product candidates may be derived from human stem cells.

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Therefore, patients in our clinical trials may experience unexpected side effects, and we may experience unexpected regulatory delays prior to or, if approval were to be granted, after regulatory approval.

Furthermore, manufacturing and development of our ex vivo stem cell-derived and allogeneic T cell-derived product candidates will require that we obtain suitable donor material from eligible and qualified human donors.

If we are unable to obtain sufficient quantities of suitable donor material, or if we are unable to obtain such material in a timely manner, we may experience delays in manufacturing our ex vivo product candidates, which would harm our ability to conduct clinical trials for or to commercialize these product candidates.

Furthermore, manufacturing and development of our stem cell-derived product candidates will require that we obtain suitable donor material from eligible and qualified human donors.

If we are unable to obtain sufficient quantities of suitable donor material, or if we are unable to obtain such material in a timely manner, we may experience delays in manufacturing such product candidates, which would harm our ability to conduct clinical trials for or to commercialize these product candidates.

Moreover, if the consent, authorization, or process for the donation and use of those materials is not obtained or conducted in accordance with applicable legal, ethical, and regulatory requirements, we could face delays in the clinical testing and approval of these product candidates, or, potentially, we could face claims by such human donors or regulatory authorities, which could expose us to damages and reputational harm.

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We are required to submit an IND or comparable foreign submission to the FDA or comparable foreign regulatory authorities with respect to each product candidate prior to commencing a clinical trial for such product candidate in the applicable jurisdiction.

Although we expect our pipeline to yield additional INDs and plan to submit INDs for each of our product candidates, we may not be able to submit future INDs in accordance with our expected timelines for various reasons, including due to:

Although we plan to submit INDs for each of our current and future product candidates, we may not be able to submit future INDs in accordance with our expected timelines for various reasons, including due to:

• manufacturing challenges or delays, including due to challenges associated with scaling up our manufacturing processes and developing and validating assays or otherwise meeting applicable regulatory requirements;

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• feedback from the FDA or comparable foreign regulatory authorities that requires us to conduct additional testing or change the design of a planned clinical trial prior to submitting such IND or comparable foreign submission.

Moreover, we cannot guarantee that submission of an IND or comparable foreign submission for a product candidate will result in the FDA or comparable foreign regulatory authorities allowing clinical trials of that product candidate to commence in accordance with our timelines or expectations or at all, or that, once begun, issues will not arise that require suspension or termination of such clinical trials.

Moreover, we cannot guarantee that submission of an IND or comparable foreign submission for a product candidate will result in the FDA or comparable foreign regulatory authorities allowing clinical trials of that product candidate to commence in accordance with our timelines or expectations or at all, including, for example, due to delays in review or approval timelines caused by disruptions and other factors impacting the FDA or comparable foreign regulatory authorities, or that, once begun, issues will not arise that require suspension or termination of such clinical trials.

For example, the FDA or a comparable foreign regulatory authority may accept an IND or comparable foreign submission for a product candidate but place clinical trials of such product candidate on hold pending the results of additional testing or the development of additional assays, or may otherwise refuse or terminate the applicable submission.

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The EU Clinical Trials Regulation (CTR), which was adopted in April 2014 and repealed the EU Clinical Trials Directive, became applicable on January 31, 2022.

Unlike the EU Clinical Trials Directive, which required a separate clinical trial application (CTA) to be submitted to both the competent national health authority and an independent ethics committee in each EU member state in which the clinical trial will be conducted, the CTR provides for a centralized process.

The CTR allows sponsors for multi-center trials to make a single submission to both the competent authority and an ethics committee in each member state, leading to a single decision per member state.

The CTA assessment procedure has been harmonized as well, including a joint assessment by all member states concerned, and a separate assessment by each member state with respect to specific requirements related to its own territory, including ethics rules.

The decision of each EU member state is communicated to the sponsor via the centralized EU portal.

The CTR allows sponsors for multi-center trials to make a single submission and obtain authorizations in multiple jurisdictions.

The system routes information to all concerned member states at once, and member states then coordinate their review of the dossier in a joint assessment, with a separate assessment by each member state with respect to specific requirements related to its own territory, including ethics rules.

Typically, one country is appointed rapporteur (lead assessor) with others as co-rapporteurs, producing a single assessment report for all and a harmonized decision.

Once the CTA is approved, clinical studies may proceed.

The CTR foresees a three-year transition period.

From January 31, 2025, any trials approved under the Clinical Trials Directive that continue running must comply with the CTR, and their sponsors must enter information regarding the trials in the Clinical Trials Information System.

Following a three-year transition period, effective January 31, 2025, any trials approved under the Clinical Trials Directive that continue running must comply with the CTR, and their sponsors must enter information regarding the trials in the CTIS.

Compliance with the CTR requirements by us and our service providers, such as CROs, may impact our development plans.

For example, because the CTR requires coordination of application review and processing across multiple member states, our ability to commence clinical trials in accordance with our timelines could be delayed.

Further, as discussed elsewhere in these Risk Factors, the United Kingdom (UK) withdrew from the EU in 2020, and uncertainty remains as to whether and to what extent certain UK laws and regulations will be aligned with those of the EU, including the CTR, which does not apply in the UK.

Further, the United Kingdom (UK) withdrew from the EU in 2020, and uncertainty remains as to whether and to what extent certain UK laws and regulations will be aligned with those of the EU, including the CTR, which does not apply in the UK.

Local requirements in the UK and the EU have diverged and may further diverge in the future, which could impact any UK clinical and development activities we may conduct.

For example, significant updates to the UK clinical trials regulations are expected to come into force in April 2026.

In addition, clinical trial submissions in the UK must be separate from those submitted to EU member states, adding further complexity, cost, and potential risk to any clinical and development activity in the UK.

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Additionally, even if regulatory authorities agree with the design and implementation of the clinical trials set forth in an IND or a comparable foreign submission, we cannot guarantee that such regulatory authorities will not change their requirements in the future, which could require us to make costly changes to and delay the conduct of our clinical trials or require suspension or termination of such trials entirely.

In addition, because the manufacturing of our product candidates, including our ex vivo CAR T cell product candidates, is in its early stages and continues to evolve, we expect that manufacturing-related matters such as chemistry, manufacturing, and controls, including product specifications, will continue to be a focus of regulatory review of our INDs or comparable foreign submissions, which may delay or prevent our ability to proceed with the relevant clinical trials.

In addition, because the manufacturing of our product candidates is in its early stages and continues to evolve, we expect that manufacturing-related matters such as chemistry, manufacturing, and controls, including product specifications, will continue to be a focus of regulatory review of our INDs or comparable foreign submissions, which may delay or prevent our ability to proceed with the relevant clinical trials.

These considerations also apply to new clinical trials we may submit as amendments to existing INDs or comparable foreign submissions.

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Product candidates in later-stage clinical trials may fail to produce the same results as observed in earlier trials or fail to show the desired safety and efficacy characteristics despite having progressed through preclinical studies and earlier clinical trials.

We do not know whether our current or future clinical trials will begin on time, need to be redesigned, enroll patients on time, or be completed on schedule, if at all.

We do not know whether any clinical trials we may conduct will begin on time, need to be redesigned, enroll patients on time, or be completed on schedule, if at all.

Clinical trials may be delayed, suspended, or terminated, or may not be able to be conducted at all, for a variety of reasons, including the following:

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• difficulty in recruiting clinical trial investigators or clinical trial sites of appropriate competencies and experience, including due to pre-existing commitments or resource and other infrastructure constraints, including resource allocation to other clinical trials, such as those of our competitors;

• delays in or inability to timely manufacture sufficient quantities of a product candidate for use in clinical trials, including due to lack of sufficient availability of suitable donor material from eligible and qualified donors for the manufacture of our ex vivo cell engineering product candidates;

• delays in or inability to timely manufacture sufficient quantities of a product candidate for use in clinical trials;

• failure of a product candidate to meet acceptable quality or stability standards, or failure to manufacture product candidates in accordance with cGMP and other applicable laws, regulations, and guidelines;

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• delays caused by the addition of new investigators or clinical trial sites or replacement of existing investigators or sites;

• safety, efficacy, or other concerns arising out of investigator-sponsored clinical trials (ISTs) involving our product candidates or technologies;

• safety or tolerability concerns relating to the product candidate being tested or other events arising during the course of a clinical trial that could cause us or governmental authorities, as applicable, to suspend or terminate a clinical trial or program or impose a clinical hold, including if participants are being exposed to unacceptable health or safety risks or experiencing undesirable side effects or other adverse events, there are other unfavorable characteristics of the product candidate, or regulators deem our product candidate to have the potential for comparable undesirable side effects or risks to those of other product candidates, including those under development by us or third parties, due to compositional, biologic, mechanistic, sourcing, or other similarities;

• safety, efficacy, or other concerns arising out of clinical trials involving our product candidates or technologies, including clinical trials we conduct ourselves or those sponsored or initiated by investigators (ISTs);

• events arising during the course of a clinical trial, such as safety or tolerability concerns relating to the relevant product candidate, that could cause us or governmental authorities, as applicable, to suspend or terminate a clinical trial or program or impose a clinical hold, including if participants are being exposed to unacceptable health or safety risks or experiencing undesirable side effects or other adverse events, there are other unfavorable characteristics of the product candidate, or regulators deem our product candidate to have the potential for comparable undesirable side effects or risks to those of other product candidates, including those under development by us or third parties, due to compositional, biologic, mechanistic, sourcing, or other similarities;

• the failure of third-party contractors to comply with regulatory requirements or meet their contractual obligations in a timely manner or at all;

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We and third parties involved in our clinical trials may not have sufficient resources to adequately address such complexities in accordance with our timelines or at all.

If we experience delays in completing, or are required to terminate, any clinical trial of our product candidates, the commercial prospects of the relevant product candidates will be harmed, and our ability to generate product revenues from these product candidates will be delayed.

In addition, any delays in completing our clinical trials will increase our costs, delay our ability to obtain regulatory approval for the relevant product candidate, and jeopardize our ability to commence product sales and generate revenues.

In addition, any delays in completing or inability to complete our clinical trials will increase our costs and delay or jeopardize our ability to obtain regulatory approval for the relevant product candidate, commence product sales, and generate revenues.

Significant clinical trial delays could also allow our competitors to bring products to market before we do or shorten any periods during which we have the exclusive right to commercialize our product candidates, which may impair our ability to commercialize our product candidates and harm our business and results of operations.

Furthermore, as described elsewhere in these Risk Factors, we rely and will continue to rely on third parties that are responsible for executing or supporting our clinical trials, such as CROs and clinical trial sites, including principal investigators, and to the extent they fail to timely and properly perform their obligations, we may experience program delays, incur additional costs, or both, which may harm our business.

In addition, we may experience delays and incur additional costs with respect to clinical trials that we conduct in countries outside the United States, including as a result of increased shipment and distribution costs, compliance with additional regulatory requirements, and the engagement of non-United States-based CROs, and may also be exposed to risks associated with clinical investigators who are unknown to the FDA, and different standards of diagnosis, screening, and medical care.

Furthermore, as described elsewhere in these Risk Factors, we have relied and will continue to rely on third parties that are responsible for executing or supporting our clinical trials, such as CROs and clinical trial sites, including principal investigators, and to the extent they fail to timely and properly perform their obligations, we may experience program delays, incur additional costs, or both, which may harm our business.

In addition, we may experience delays and incur additional costs with respect to any clinical trials that we conduct in countries outside the United States, including as a result of increased shipment and distribution costs, compliance with additional or different regulatory requirements, and the engagement of non-United States-based CROs or other third parties, and may also be exposed to various other risks, including those associated with clinical investigators who are unknown to the FDA, transfers and use of data across jurisdictions, and different standards of diagnosis, screening, and medical care.

We will depend on timely and successful enrollment and retention of patients in our clinical trials for our product candidates.

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We may be unable to establish clinical endpoints that applicable regulatory authorities would consider clinically meaningful.

Clinical trials of our product candidates or product candidates developed using our technologies (including those conducted by third parties, such as in the case of ISTs) may not demonstrate that such product candidates or technologies have efficacy and safety profiles necessary to support regulatory approval.

Safety or efficacy results for a particular clinical trial, or between different clinical trials of the same product candidate, can vary significantly due to numerous factors, including differences in the size and type of the patient populations, variety of patients and disease types within a trial, changes in and adherence to the clinical trial protocols and trial procedures, and the rate of dropout among clinical trial participants.

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We do not currently, and in the future may not, have sufficient clinical data or other information to enable us to fully anticipate the side effects of our product candidates.

Accordingly, we may observe unexpected side effects or higher levels of expected side effects in clinical trials of our product candidates, including adverse events known to occur in the same classes of therapeutics, such as infusion reaction, cytokine release syndrome, graft-versus-host disease, neurotoxicities, severe infection, and certain cancers.

Accordingly, we may observe unexpected side effects or higher levels of expected side effects in clinical trials of our product candidates, including adverse events known to occur in the same classes of therapeutics, which may include infusion reaction, cytokine release syndrome, graft-versus-host disease, neurotoxicities, severe infection, and certain cancers.

Results of our clinical trials could reveal a high and unacceptable severity and prevalence of these or other side effects associated with our product candidates.

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If the interim, topline, or preliminary data that we report differ from actual results, or if others, including regulatory authorities, investors, or analysts, disagree with the conclusions reached, our ability to obtain approval for and commercialize our product candidates, as well as our business, operating results, prospects, and financial condition, could be harmed.

Our product candidates or technologies may be involved in investigator-sponsored clinical trials, and we will have limited or no control over the conduct of such trials.

Our product candidates or technologies may be involved in ISTs, and we will have limited or no control over the conduct of such trials.

ISTs involving our product candidates or technologies pose or are subject to similar risks to those set forth elsewhere in these Risk Factors relating to clinical trials that we conduct ourselves.

Although ISTs may provide us with clinical data that can inform the development strategy for our product candidates, we will be unable to control the timing, design, and conduct of such ISTs or regulatory matters with respect to such ISTs, including the submission, clearance or approval, or maintenance of any IND or comparable foreign submission required to conduct such ISTs.

In addition, we will not control the data collection and reporting, including timing thereof, with respect to any ISTs, and may not control the manufacturing of the product candidate or technology to be tested in any such ISTs.

Although ISTs may provide us with clinical data that can inform the development strategy for our product candidates, we may have limited or no ability to control the timing, design, and conduct of such ISTs or regulatory matters with respect to such ISTs, including the submission, clearance or approval, or maintenance of any IND or comparable foreign submission required to conduct such ISTs.

In addition, we may not control the data collection and reporting, including timing thereof, with respect to any ISTs, and may not control the manufacturing of the product candidate or technology to be tested in any such ISTs.

A delay in the timely completion of or reporting of data from any IST, including as a result of manufacturing complications or delays, which could occur for various reasons such as the need to obtain additional licenses, delays in recruiting, enrolling, or retaining patients, or other potential issues, including those described in these Risk Factors, could have a material adverse effect on our ability to further develop our product candidates or to advance our product candidates through subsequent clinical trials.

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Additionally, there is a possibility that ISTs may be conducted under less rigorous clinical standards than those used in company-sponsored clinical trials.

Accordingly, the FDA and comparable foreign regulatory authorities may more closely scrutinize the resulting data and may not view these data as providing adequate support for future clinical trials, whether sponsored by us or third parties.

For these or other reasons, the FDA and comparable foreign regulatory authorities may more closely scrutinize the resulting data and may not view these data as providing adequate support for future clinical trials, whether sponsored by us or third parties.

In addition, any potential IST could demonstrate marginal efficacy or reveal clinically relevant safety concerns that could delay the further clinical development or regulatory approval of our product candidates.

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To the extent that the results of any ISTs raise safety or other concerns regarding our product candidates or technologies, regulatory authorities may question the results of such ISTs or other clinical trials involving the relevant product candidate or technology.

Safety concerns arising from any ISTs may cause the FDA or comparable foreign regulatory authorities to impose partial or full clinical holds on our product candidates, including product candidates that were developed using the same technology or manufactured using the same reagents and materials as those product candidates that are the subject of such ISTs, which could delay or prevent us from advancing our product candidates into further clinical development and require us to discontinue our development of such product candidates.

Safety concerns arising from any ISTs may cause the FDA or comparable foreign regulatory authorities to impose partial or full clinical holds on clinical trials of our product candidates, including product candidates that were developed using the same technology or manufactured using the same reagents and materials as those product candidates that are the subject of such ISTs, which could delay or prevent us from advancing our product candidates into further clinical development and require us to discontinue our development of such product candidates.

The occurrence of any of the foregoing would severely harm our business and prospects.

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Our product candidates are considered to be biologics, and the process of manufacturing biologics is complex and requires significant expertise and capital investment, including with respect to the development of advanced manufacturing techniques and process controls.

We currently rely, and expect to continue to rely, on CDMOs for the manufacture of certain of our product candidates for preclinical and clinical studies.

We currently rely, and expect to continue to rely, on CDMOs for the manufacture of our product candidates for clinical studies.

We also anticipate that we will continue to rely on CDMOs for at least some portions of our supply chain following commercialization of any product candidates for which we may receive regulatory approval.

As described elsewhere in these Risk Factors, we expect that we will continue to be required to transition certain manufacturing processes and know-how to our CDMOs and any manufacturing facility we may operate, which is a complex process with which we have limited experience.

If we experience any delays or issues with the foregoing, our ability to begin manufacturing certain of our product candidates internally could be delayed, and we may need to rely to a greater extent on CDMOs for the manufacture of such product candidates for longer than we currently anticipate.

As described elsewhere in these Risk Factors, we expect that we will continue to be required to transfer certain manufacturing processes and know-how to our CDMOs and any manufacturing facility we may operate, which is a complex process with which we have limited experience.

If we experience any delays or issues with the foregoing, manufacturing of our product candidates could be delayed, and we may need to rely to a greater extent on CDMOs for the manufacture of such product candidates for longer than anticipated.

To date, we and our CDMOs have limited experience in manufacturing of cGMP batches of our product candidates.

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To date, we have not scaled the manufacturing processes with respect to our product candidates for later-stage clinical trials and commercialization, and we and our CDMOs may not have sufficient capacity, resources, or capabilities to scale such manufacturing processes in accordance with our desired timelines or at all.

Further, certain of our product candidates may have characteristics that present increased manufacturing complexity, necessitate longer manufacturing process timelines, or require a greater number of manufacturing runs.

Further, certain of our product candidates, or materials used in their manufacture, may have characteristics that present increased manufacturing complexity, necessitate longer manufacturing process timelines, or require a greater number of manufacturing runs.

If we are unable to successfully scale the manufacturing process for these product candidates, including in compliance with cGMP quality requirements, or adapt such manufacturing process to meet late-stage development or commercial quality requirements, we may not be able to manufacture sufficient quantities of compliant product candidates, or manufacture them in a timely manner, which would harm our ability to clinically develop and commercialize such product candidates.

In addition, the manufacturing of our product candidates, including large-scale manufacturing, may require the development of novel processes for upstream and downstream activities, including analytical technologies, which could cause delays in the scaling of manufacturing, as well as greater costs that could negatively impact the financial viability of our product candidates.

In addition, the manufacturing of our product candidates, including large-scale manufacturing, may require new technologies and the development of novel processes for upstream and downstream activities, including analytical technologies, which could cause delays in the scaling of manufacturing, as well as greater costs that could negatively impact the financial viability of our product candidates.

We cannot be sure that the manufacturing processes employed by us or our CDMOs or the technologies that our CDMOs incorporate into our manufacturing processes will result in viable or scalable yields of ex vivo and in vivo cell engineering product candidates that will have acceptable safety, purity, potency, or efficacy profiles and, if approved, meet market demand.

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The occurrence of any of these issues could delay our ability to commence or timely complete clinical development, obtain regulatory approval of, and commercialize our product candidates.

We also may make changes to our manufacturing processes at various points during development, and even after commercialization, for various reasons, such as to control costs, achieve scale, decrease processing time, or increase manufacturing success rate.

We also may make changes to our manufacturing processes at various points during development, and even after commercialization, for various reasons, such as to control costs, achieve scale, improve quality, decrease processing time, or increase manufacturing success rate.

Such changes carry the risk that they will not achieve their intended objectives, and any of these changes could result in changes to a product candidate’s characteristics or behavior or cause our product candidates to perform differently and affect the results of any of our then-ongoing or future preclinical studies or clinical trials, or the performance of the product, once commercialized.

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In addition, we rely on third parties for the supply of these materials, which exposes us to risks associated with dependence on third parties, as described elsewhere in these Risk Factors.

Further, we use certain reagents and materials across various programs and initiatives, and any difficulties we experience with such reagents or materials, including with respect to sourcing, quality, or other factors, could have a more significant impact on our portfolio and business than if we used different reagents and materials for each of our programs and initiatives.

We must obtain suitable donor material from eligible and qualified donors for the manufacture of product candidates from our ex vivo cell engineering platform.

If we are unable to obtain sufficient quantities of suitable donor material in a timely manner or at all, including if we are unable to find donors who meet the eligibility criteria or as a result of geo-political, economic, and other factors beyond our control that may prevent individuals from donating blood, we may experience delays in manufacturing our ex vivo product candidates, which would harm our ability to conduct clinical trials of or to commercialize these product candidates.

Further, we may use certain reagents and materials across various programs and initiatives, and any difficulties we experience with such reagents or materials, including with respect to sourcing, quality, or other factors, could have a more significant impact on our portfolio and business than if we used different reagents and materials for each of our programs and initiatives.

In addition, we require many reagents, which are drug substance intermediates used in our manufacturing processes to bring about chemical or biological reactions, and other specialty raw and intermediate materials, consumables, and equipment, for our manufacturing processes and for quality control testing of our product candidates, some of which are manufactured or supplied by small companies with limited resources and experience with respect to supporting clinical or commercial biologics production.

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Additionally, as described elsewhere in these Risk Factors, rising rates of inflation in recent years and other factors have resulted in substantial increases in the costs associated with manufacturing our product candidates, including the costs of materials, consumables, and equipment, that we are unable to offset.

Given the unpredictable nature of the current economic climate, including future rates of inflation, it may be increasingly difficult for us to predict and control our future expenses, which may harm our ability to conduct our business.

Given the unpredictable nature of the current economic climate, including the potential impact of tariffs, export controls, and future rates of inflation, it may be increasingly difficult for us to predict and control our future expenses, which may harm our ability to conduct our business.

As we continue to develop and scale our manufacturing processes, we expect that we will need to obtain rights to and supplies of certain materials and equipment to be used as part of those processes.

We may not be able to obtain rights to or sufficient quantities of such materials or equipment on commercially reasonable terms, or at all, and our inability to alter our processes in a commercially viable manner to avoid the use of such materials or equipment or find suitable substitutes would have a material adverse effect on our business.

Even if we are able to alter our processes so as to use other materials or equipment, such a change may delay our clinical development or commercialization plans.

Even if we are able to alter our processes to use other materials or equipment, such a change may delay our clinical development or commercialization plans.

As described elsewhere in these Risk Factors, if such a change occurs for product candidate that is already being tested in clinical trials, the change may require us to perform comparability studies, demonstrate that the new materials or equipment meet applicable specifications, and collect additional data from patients prior to undertaking more advanced clinical trials.

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We intend to expand our insurance coverage to include the sale of commercial products if we obtain marketing approval for any of our product candidates.

However, we may be unable to maintain insurance cover

However, we may be unable to maintain insurance coverage at a reasonable cost or obtain insurance coverage that will be adequate to satisfy any liability that may arise.

If a successful product liability claim or series of claims is brought against us for uninsured liabilities or in excess of insured liabilities, our assets may not be sufficient to cover such claims, and our business operations could be impaired.

Risks Related to Our Dependence on Third Parties

We rely, and expect to continue to rely, on CDMOs, including third-party testing laboratories, to manufacture our product candidates, as well as materials used in the manufacturing of our product candidates, including testing of such product candidates and materials.

Any failure by a CDMO to properly produce acceptable materials or product candidates for us or any failure by us or such CDMO to obtain authorization from the FDA or comparable foreign regulatory authorities or otherwise satisfy regulatory requirements with respect to such manufacturing of our product candidates may delay or impair our ability to initiate or complete our clinical trials, obtain regulatory approvals, or commercialize approved products.

We rely on CDMOs, including third-party testing laboratories, to manufacture our product candidates for use in clinical testing and expect to continue to rely on such CDMOs to manufacture at least some of our product candidates thereafter as part of our manufacturing strategy.

A limited number of CDMOs specialize in or have the expertise required to manufacture our product candidates or materials used in their manufacture.

Moreover, our CDMOs have limited capacity at their facilities and require commitments to secure availability well in advance of manufacturing any products or other materials.

Additionally, we face competition from other biopharmaceutical companies to secure manufacturing availability at these facilities.

If the CDMOs on which we rely to manufacture our product candidates and other materials do not have sufficient availability at their facilities to do so in accordance with our timelines or are not otherwise able to meet our expected deadlines, we will experience delays in manufacturing our product candidates or other materials necessary for their manufacture.

For example, we may rely on single CDMOs for certain manufacturing activities across multiple programs, and any issues we may experience with such a CDMO, including inability to secure manufacturing capacity as and when needed, could result in manufacturing delays across all such programs and harm our ability to timely and successfully complete clinical trials and commercialization of our product candidates.

In addition, as described elsewhere in these Risk Factors, we assess and prioritize our programs on an ongoing basis based on various factors.

We may not be able to secure manufacturing capacity for certain programs as and when needed and may be required to prioritize manufacturing activities for certain programs over others, which could lead to manufacturing delays and harm our ability to further develop the relevant product candidates.

We may also experience similar capacity constraints and manufacturing delays in the future with respect to products we may manufacture at any manufacturing facility we may operate.

Further, for each new program or CDMO we engage, or in the case of certain changes to the manufacturing process for a product candidate, the relevant manufacturing process and related know-how must be transferred to the CDMO.

This technology transfer is time-consuming and complex.

If we are required to switch from an existing CDMO to a new CDMO or to any manufacturing facility we may operate, including to meet cGMP quality requirements or support process lock or larger-scale manufacturing for later-stage clinical trials or potential commercialization, we will need to conduct additional technology transfer activities, which could result in delays in further development of the applicable product candidate.

Our CDMOs also face intense competition to attract and retain qualified personnel.

If our CDMOs are unable to attract, retain, and motivate qualified personnel, they may be unable to perform their obligations in a timely manner or at all, or their performance may be substandard or may not meet our quality requirements, which could cause us to experience delays in or otherwise negatively impact the manufacturing of our product candidates.

In addition, our CDMOs and other third parties supporting our operations may experience organizational changes, including due to mergers, acquisitions, or other transactions in which they are involved, which could similarly affect such parties’ ability to timely and properly perform their obligations or perform such obligations at all.

Further, as described elsewhere in these Risk Factors, there are few alternatives for the CDMOs that we currently engage, and even if one of our CDMOs fails to perform according to our expectations and, for this or other reasons, we decide to switch to an alternative CDMO, there is no guarantee that such alternative CDMO will be able to perform its obligations in a timely manner or that its performance will meet our expectations or quality requirements.

Any delays in manufacturing our product candidates could materially harm our ability to conduct our clinical trials or commercialize our product candidates in a timely manner or at all and could harm our business.

In addition, we may rely on CDMOs to produce sufficient quantities of materials required for the manufacture of our product candidates for preclinical testing and clinical trials and intend to continue to rely on CDMOs for the commercial manufacture of at least some of our products, if approved.

Global supply chain shortages and rising rates of inflation in recent years and other factors have resulted in substantial increases in the costs of materials, including raw materials, reagents, consumables, and equipment that are required to make or used in the manufacture of our product candidates, and such costs may continue to increase for various reasons, including those described elsewhere in these Risk Factors.

If we are unable to obtain such items from third-party sources, or fail to do so on commercially reasonable terms, we may not be able to produce sufficient supply of product candidate or we may be delayed or be required to incur additional costs in doing so.

Such inability or failure, or any substantial delay in obtaining or additional costs for such items, could materially harm our business.

We rely on third parties to produce certain reagents and biological materials that are used in our discovery and development programs.

These materials can be difficult to produce and occasionally have variability from our product specifications.

If these materials do not comply with our product specifications, or in the event of any other disruption in the supply of these materials, our business could be materially adversely affected.

Although we have control processes and screening procedures, biological materials are susceptible to damage and contamination and may contain active pathogens.

Our suppliers may also have low yield from manufacturing batches of these materials, which could increase our costs and slow our development timelines.

Improper storage of these materials, by us or any third-party suppliers, may require us to destroy some of these materials or product candidates generated using such materials.

Reliance on CDMOs entails additional risks to which we would not be subject if we manufactured product candidates ourselves, including those applicable to other third-party service providers, as described elsewhere in these Risk Factors.

In particular, such risks include reliance on the CDMO for regulatory compliance and quality control and assurance, including compliance with cGMP requirements and comparable standards relating to methods, facilities, and controls used in the manufacturing, processing, testing, and packing of product candidates, which are intended to ensure that biological products have acceptable safety profiles and that they consistently meet applicable requirements and specifications, and our CDMOs may be unable to satisfy applicable compliance and quality requirements in accordance with our timelines or at all.

Additional risks include reliance on the CDMO for volume production, the possibility of breach of or inability to perform its obligations under the manufacturing agreement by the CDMO (including a failure to synthesize and manufacture our product candidates in accordance with our product specifications, failure to properly scale-up manufacturing processes, or failure to deliver sufficient quantities of product candidates in a timely manner), and the possibility of termination or nonrenewal of the agreement by the CDMO at a time that is costly or damaging to us.

For example, certain of our CDMOs may be unable to manufacture sufficient supply of our product candidates or materials used in their manufacture, in particular, if and as we implement commercial cGMP practices or scale up manufacturing for later-stage clinical trials and potential commercialization.

If we experience any issues with respect to the risks described above, or otherwise with respect to the performance by our CDMOs, we may be required to seek a replacement CDMO, which could require significant internal resources and additional costs, delay our ongoing manufacturing activities, and ultimately be unsuccessful.

If we were unable to timely find an adequate replacement for our CDMOs or another acceptable solution when needed, our clinical trials could be delayed, or our commercial activities could be harmed.

In addition, because we depend on our CDMOs, our suppliers, and other third parties for the manufacture, filling, storage, and distribution of our product candidates, we may be unable to prevent or control manufacturing defects in our products, the use or sale of which could seriously harm our business, financial condition, and results of operations.

Issues involving any of the foregoing risks could increase our costs, delay our development timelines, and ultimately lead to a delay in, or failure to obtain, regulatory approval of our product candidates.

Pharmaceutical manufacturers are required to register their facilities and products manufactured at the time of submission of the marketing application and then annually thereafter with the FDA and certain state and foreign agencies.

If the FDA or a comparable foreign regulatory authority does not approve our CDMO’s facilities for the manufacture of our product candidates or if it withdraws any such approval in the future, we may need to find alternative manufacturing facilities, which would significantly impact our ability to develop, obtain regulatory approval for, or market our product candidates, if approved, on a timely basis or at all.

Any discovery of problems with a product, or a manufacturing or laboratory facility used by us or our strategic partners in connection with manufacturing of that product, may result in restrictions on the product or on the relevant facility, including marketed product recall, suspension of manufacturing, product seizure, or a voluntary withdrawal of the drug from the market.

We may have little to no control regarding the occurrence of any such incidents at our CDMOs.

Pharmaceutical manufacturers are also subject to extensive post-marketing oversight by the FDA and comparable regulatory authorities in the jurisdictions where a product is marketed, including periodic unannounced and announced inspections by the FDA to assess compliance with cGMP requirements.

Any failure by one of our CDMOs to comply with cGMP or to provide adequate and timely corrective actions in response to deficiencies identified in a regulatory inspection could result in further enforcement action that could lead to a shortage of products and harm our business, including withdrawal of approvals previously granted, seizure, injunction, or other civil or criminal penalties.

The failure of a CDMO to address any concerns raised by the FDA or comparable foreign regulatory authorities could also lead to plant shutdown or the delay or withholding of product approval by the FDA in additional indications or by comparable foreign regulatory authorities in any indication.

In addition, because our CDMOs also provide manufacturing services to other companies, including our competitors, there is a risk that our CDMOs may experience the issues described in this Risk Factor with respect to such third parties and their product candidates as well.

The occurrence of any such issues could restrict, partially or completely, or otherwise negatively impact such CDMO’s ability to timely and successfully perform its obligations for us with respect to our own product candidates, which would harm our ability to continue manufacturing and commercialize such product candidates.

Certain countries may impose additional requirements on the manufacturing of drug products or drug substances, and on manufacturers, as part of the regulatory approval process for products in such countries.

The failure by our CDMOs to satisfy such requirements could impact our ability to obtain or maintain approval of our products in such countries.

In addition, as described elsewhere in these Risk Factors, our CDMOs may be subject to various other laws and regulations, compliance with or the effect of which could harm our relationship with such CDMOs and negatively impact our business.

If we are unable to obtain sufficient raw and intermediate materials on a timely basis or if we experience other manufacturing or supply interruptions or difficulties, we may be unable to resume supply of such materials or other manufacturing activities within a reasonable time frame and at an acceptable cost or at all, which could materially adversely affect our business.

The manufacture of our product candidates requires the timely delivery of sufficient amounts of raw and intermediate materials.

We purchase, and rely on our CDMOs to purchase, certain of these materials from third-party suppliers in order to produce our product candidates for our preclinical and clinical studies.

There are a limited number of suppliers of these materials, and we may need to assess alternate suppliers to prevent possible disruption of manufacturing of our product candidates for our preclinical studies, our future clinical trials, and if ultimately approved, commercial sale.

We have relied, and expect to continue to rely, on our CDMOs to purchase materials in order to produce product candidates for our clinical trials;

however, we do not have any control over the process or timing of the acquisition of these materials by our CDMOs or the costs of such materials.

We work closely with our CDMOs and suppliers, as applicable, to ensure the continuity of supply, but we cannot ensure that these efforts will always be successful.

Further, although we strive to diversify our sources of raw and intermediate materials, in certain instances we acquire raw and intermediate materials from a sole supplier.

We cannot be sure that these suppliers will remain in business, or that they will not be purchased by one of our competitors or another company that is not interested in continuing to supply these materials for our intended purpose.

As described elsewhere in these Risk Factors, such suppliers may also experience other organizational changes that could negatively impact their ability to supply necessary materials for our programs in a timely manner or at all.

Alternative sources of supply may exist when we rely on sole supplier relationships, but we cannot ensure that, if needed, we would be able to quickly establish additional or replacement sources for some materials.

The lead time needed to establish a relationship with a new supplier can be lengthy, and we may experience delays in the event a new supplier must be used.

In addition, the time and effort to qualify a new supplier could result in additional costs, diversion of resources, or reduced manufacturing yields, any of which would negatively impact our operating results.

Although we generally would not begin a clinical trial unless we believe we have a sufficient supply of a product candidate to complete the clinical trial, any significant delay in the supply of a product candidate, or the raw or intermediate material components thereof, for an ongoing clinical trial due to the need to replace a supplier could considerably delay completion of our clinical trials, product testing, and potential regulatory approval of our product candidates.

Moreover, we currently do not have any agreements for the commercial supply of these raw or intermediate materials.

A reduction or interruption in supply of raw or intermediate materials combined with an inability of us or our CDMOs to timely establish alternative sources for such supply could adversely affect our ability to manufacture our product candidates or approved products in a timely or cost-effective manner, result in a shortage of product supply, delay the development and any commercial launch of our product candidates, and ultimately impair our ability to generate revenues from sales of any approved products.

We rely, and expect to continue to rely, on third parties, including service providers such as CROs, clinical trial sites, including principal investigato

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What changed 10-K

Item 1. Business