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Editas Medicine, Inc.

Editas Medicine, Inc.EDITEarnings & Financial Report

Nasdaq · Health Care · Biological Products, (No Diagnostic Substances)

Editas Medicine, Inc.,, is a clinical-stage biotechnology company which is developing therapies for rare diseases based on CRISPR gene editing technology. Editas headquarters is located in Cambridge, Massachusetts and has facilities in Boulder, Colorado.

What changed in Editas Medicine, Inc.'s 10-K — 2023 vs 2024

Top changes in Editas Medicine, Inc.'s 2024 10-K

688 paragraphs added · 611 removed · 461 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

213 edited+99 added−79 removed394 unchanged
Broad may not so designate any gene target for which we, directly or through any of our affiliates, sublicensees, or collaborators, are researching, developing, or commercializing a product, or for which we can demonstrate to Broad’s reasonable satisfaction that we are interested in researching, developing, and commercializing a product, that we have a commercially reasonable research, development, and commercialization plan to do so, and we commence and continue reasonable commercial efforts under such plan.
Broad may not so designate any gene target for which we, directly or through any of our affiliates, sublicensees, or collaborators, are researching, developing, or commercializing a product, or for which we can demonstrate to Broad’s reasonable satisfaction that we are interested in researching, developing, and commercializing a product, that we have a commercially reasonable research, development, and commercialization plan to do so, and we commence and continue reasonable commercial efforts under such plan.
Unless otherwise required by regulation, the pediatric data requirements do not apply to products with orphan designation, although FDA has taken steps to limit what it considers abuse of this statutory exemption in PREA by announcing that it does not intend to grant any additional orphan drug designations for rare pediatric subpopulations of what is otherwise a common disease.
Unless otherwise required by regulation, the pediatric data requirements do not apply to products with orphan designation, although the FDA has taken steps to limit what it considers abuse of this statutory exemption in PREA by announcing that it does not intend to grant any additional orphan drug designations for rare pediatric subpopulations of what is otherwise a common disease.
In pertinent part, FDA’s regulations state that an application “shall not be considered as filed until all pertinent information and data have been received” by the FDA. In the event that FDA determines that an application does not satisfy this standard, it will issue a Refuse to File (“RTF”) determination to the sponsor.
In pertinent part, the FDA’s regulations state that an application “shall not be considered as filed until all pertinent information and data have been received” by the FDA. In the event that the FDA determines that an application does not satisfy this standard, it will issue a Refuse to File (“RTF”) determination to the sponsor.
Specifically, the new legislation authorized FDA to: require a sponsor to have its confirmatory clinical trial underway before accelerated approval is awarded, require a sponsor of a product granted accelerated approval to submit progress reports on its post-approval studies to FDA every six months (until the study is completed; and use expedited procedures to withdraw accelerated approval of an NDA or BLA after the confirmatory trial fails to verify the product’s clinical benefit.
Specifically, the new legislation authorized the FDA to: require a sponsor to have its confirmatory clinical trial underway before accelerated approval is awarded, require a sponsor of a product granted accelerated approval to submit progress reports on its post-approval studies to the FDA every six months (until the study is completed); and use expedited procedures to withdraw accelerated approval of an NDA or BLA after the confirmatory trial fails to verify the product’s clinical benefit.
On January 23, 2023, FDA announced that, in matters beyond the scope of that court order, FDA will continue to apply its existing regulations tying orphan-drug exclusivity to the uses or indications for which the orphan drug was approved.
On January 23, 2023, the FDA announced that, in matters beyond the scope of that court order, the FDA will continue to apply its existing regulations tying orphan-drug exclusivity to the uses or indications for which the orphan drug was approved.
Pediatric Exclusivity Pediatric exclusivity is another type of non-patent marketing exclusivity in the United States and, if granted, provides for the attachment of an additional six months of marketing protection to the term of any existing regulatory exclusivity, including the non-patent and orphan exclusivity.
Pediatric Exclusivity Pediatric exclusivity is another type of non-patent marketing exclusivity in the United States and, if granted, provides for the attachment of an additional six months of marketing protection to the term of any existing regulatory exclusivity, including orphan exclusivity.
In December 2022, Congress clarified through FDORA that FDA may approve multiple first interchangeable biosimilar biological products so long as the products are all approved on the first day on which such a product is approved as interchangeable with the reference product.
In December 2022, Congress clarified through FDORA that the FDA may approve multiple first interchangeable biosimilar biological products so long as the products are all approved on the first day on which such a product is approved as interchangeable with the reference product.
That regulation was challenged in a lawsuit by the Pharmaceutical Research and Manufacturers of America (“PhRMA”) but the case was dismissed by a federal district court in February 2023 after the court found that PhRMA did not have standing to sue HHS.
That regulation was challenged in a lawsuit by the Pharmaceutical Research and Manufacturers of America (“PhRMA”) but the case was dismissed by a federal district court in February 2023 after the court found that PhRMA did not have standing to sue the HHS.
On June 6, 2023, Merck filed a lawsuit against HHS and CMS asserting that, among other things, the IRA’s Drug Price Negotiation Program for Medicare constitutes an uncompensated taking in violation of the Fifth Amendment of the Constitution. Subsequently, a number of other parties, including the U.S.
On June 6, 2023, Merck filed a lawsuit against the HHS and the CMS asserting that, among other things, the IRA’s Drug Price Negotiation Program for Medicare constitutes an uncompensated taking in violation of the Fifth Amendment of the Constitution. Subsequently, a number of other parties, including the U.S.
Chamber of Commerce (“Chamber”), Bristol Myers Squibb Company, the Pharmaceutical Research and Manufacturers of America, Astellas, Novo Nordisk, Janssen Pharmaceuticals, Novartis, AstraZeneca and Boehringer Ingelheim, also filed lawsuits in various courts with similar constitutional claims against HHS and CMS.
Chamber of Commerce (“Chamber”), Bristol Myers Squibb Company, the Pharmaceutical Research and Manufacturers of America, Astellas, Novo Nordisk, Janssen Pharmaceuticals, Novartis, AstraZeneca and Boehringer Ingelheim, also filed lawsuits in various courts with similar constitutional claims against the HHS and the CMS.
Mergers and acquisitions in the pharmaceutical, biotechnology, and gene therapy industries may result in even more resources being concentrated among a smaller number of our competitors. Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.
Mergers and acquisitions in the pharmaceutical, biotechnology, and gene therapy industries may result in even more resources being concentrated among a smaller number of our competitors. Smaller or other early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.
The patents and patent applications outside of the United States and Europe are held primarily in Canada, Japan, and Australia, although some of our in-licensed patent families were filed in a larger number of countries. The claims from our in-licensed portfolio include claims to compositions of matter, methods of use, and certain processes.
The patents and patent applications outside of the United States and Europe are held primarily in Canada, China, Japan, and Australia, although some of our in-licensed patent families were filed in a larger number of countries. The claims from our in-licensed portfolio include claims to compositions of matter, methods of use, and certain processes.
Data Privacy Framework, which would serve as a replacement to the EU-U.S. Privacy Shield. The European Union initiated the process to adopt an adequacy decision for the EU-U.S. Data Privacy Framework in December 2022 and the European Commission adopted the adequacy decision on July 10, 2023. The adequacy decision will permit U.S. companies who self-certify to the EU-U.S.
Data Privacy Framework, which would serve as a replacement to the EU-U.S. Privacy Shield. The EU initiated the process to adopt an adequacy decision for the EU-U.S. Data Privacy Framework in December 2022 and the European Commission adopted the adequacy decision on July 10, 2023. The adequacy decision will permit U.S. companies who self-certify to the EU-U.S.
Orphan Drug Designation and Exclusivity Regulation (EC) No 141/2000 and Regulation (EC) No. 847/2000 provide that a product can be designated as an orphan drug by the European Commission if its sponsor can establish: that the product is intended for the diagnosis, prevention or treatment of (1) a life-threatening or chronically debilitating condition affecting not more than five in ten thousand persons in the European Union when the application is made, or (2) a life-threatening, seriously debilitating or serious and chronic condition in the European Union and that without incentives it is unlikely that the marketing of the drug in the European Union would generate sufficient return to justify the necessary investment.
Orphan Drug Designation and Exclusivity Regulation (EC) No 141/2000 and Regulation (EC) No. 847/2000 provide that a product can be designated as an orphan drug by the European Commission if its sponsor can establish: that the product is intended for the diagnosis, prevention or treatment of (1) a life-threatening or chronically debilitating condition affecting not more than five in ten thousand persons in the EU when the application is made, or (2) a life-threatening, seriously debilitating or serious and chronic condition in the EU and that without incentives it is unlikely that the marketing of the drug in the EU would generate sufficient return to justify the necessary investment.
Other Broad Agreements In addition to the Cas9-I License Agreement and the Cpf1 License Agreement, in December 2016, we entered into a license agreement with Broad for certain Cas9 compositions of matter and their use for gene editing, which was amended in January 2021 and February 2024 (as amended, the “Cas9-II Agreement”), and, in June 2018, we entered into a 20 Table of Contents Sponsored Research Agreement with Broad providing for Broad to conduct research useful or relevant to genome editing in the field of genomic medicines for the prevention of treatment of human diseases with funding from us, which was amended in January 2021 (as amended, the “Sponsored Research Agreement”).
Other Broad Agreements In addition to the Cas9-I License Agreement and the Cpf1 License Agreement, in December 2016, we entered into a license agreement with Broad for certain Cas9 compositions of matter and their use for gene editing, which was amended 19 Table of Contents in January 2021 and February 2024 (as amended, the “Cas9-II Agreement”), and, in June 2018, we entered into a Sponsored Research Agreement with Broad providing for Broad to conduct research useful or relevant to genome editing in the field of genomic medicines for the prevention of treatment of human diseases with funding from us, which was amended in January 2021 (as amended, the “Sponsored Research Agreement”).
Clinical holds are imposed by the FDA whenever there is concern for patient safety and may be a result of new data, findings, or developments in clinical, nonclinical, and/or chemistry, manufacturing, and controls.
Clinical holds are imposed by the FDA whenever there is concern for patient safety and may be a result of new data, findings, or developments in clinical, nonclinical, and/or chemistry, manufacturing, and controls (“CMC”).
CMS may negotiate prices for ten high-cost drugs paid for by Medicare Part D starting in 2026, followed by 15 Part D drugs in 2027, 15 Part B or Part D drugs in 2028, and 20 Part B or Part D drugs in 2029 and beyond.
The CMS may negotiate prices for ten high-cost drugs paid for by Medicare Part D starting in 2026, followed by 15 Part D drugs in 2027, 15 Part B or Part D drugs in 2028, and 20 Part B or Part D drugs in 2029 and beyond.
Examples of these licensing efforts include our non-exclusive license to Vor for the development of ex vivo Cas9 gene-edited HSC therapies for the treatment and/or prevention of hematological malignancies; our non-exclusive license to Vertex for our Cas9 gene editing technology for ex vivo gene editing medicines targeting the BCL11A gene in the fields of SCD and TDT, including Vertex’s CASGEVY TM (exagamglogene autotemcel); and our non-exclusive license to Immatics N.V. of our AsCas12a technology to advance gamma-delta T cell therapies for the treatment of cancer.
Examples of these licensing efforts include our non-exclusive license to Vor for the development of ex vivo Cas9 gene-edited HSC therapies for the treatment and/or prevention of hematological malignancies; our non-exclusive license to Vertex for our Cas9 gene editing technology for ex vivo gene editing medicines targeting the BCL11A gene in the fields of SCD and TDT, including Vertex’s CASGEVY TM (exagamglogene autotemcel); and our non-exclusive license to Immatics of our AsCas12a technology to advance gamma-delta T cell therapies for the treatment of cancer.
If our operations are found to be in violation of any of the privacy or data security laws or regulations described above that are applicable to us, or any other laws that apply to us, we may be subject to penalties, including potentially significant criminal, civil and administrative penalties, damages, fines, contractual damages, reputational harm, diminished profits and future earnings, additional reporting requirements and/or oversight if we become subject to a consent decree or similar agreement to resolve allegations of non-compliance with these laws, and the curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business and our results of operations.
If our operations are found to be in violation of any of the privacy or data security laws or regulations described above that are applicable to us, or any other laws that apply to us, we may be subject to penalties, including potentially significant criminal, civil and administrative penalties, damages, fines, contractual damages, reputational harm, 46 Table of Contents diminished profits and future earnings, additional reporting requirements and/or oversight if we become subject to a consent decree or similar agreement to resolve allegations of non-compliance with these laws, and the curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business and our results of operations.
The failure to comply with the applicable U.S. requirements at any time during the product development process, including non-clinical testing, clinical testing, the approval process or post-approval process, may subject a sponsor to delays in the conduct of the study, regulatory review and approval, and/or administrative or judicial sanctions. 24 Table of Contents A sponsor seeking approval to market and distribute a new biologic in the United States generally must satisfactorily complete each of the following steps: • preclinical laboratory tests, animal studies and formulation studies all performed in accordance with the FDA’s Good Laboratory Practice (“GLP”) regulations and standards; • completion of the manufacture, under current Good Manufacturing Practices (“cGMP”) conditions, of the drug substance and drug product that the sponsor intends to use in human clinical trials along with required analytical and stability testing; • design of a clinical protocol and submission to the FDA of an IND application for human clinical testing, which must become effective before human clinical trials may begin; • approval by an independent institutional review board (“IRB”) representing each clinical site before each clinical trial may be initiated; • performance of adequate and well-controlled human clinical trials to establish the safety, potency, and purity of the product candidate for each proposed indication, in accordance with current Good Clinical Practices (“GCP”); • preparation and submission to the FDA of a Biologic License Application (“BLA”) for a biologic product requesting marketing for one or more proposed indications, including submission of detailed information on the manufacture and composition of the product in clinical development and proposed labelling; • review of the product by an FDA advisory committee, where appropriate or if applicable; • satisfactory completion of one or more FDA inspections of the manufacturing facility or facilities, including those of third parties, at which the product, or components thereof, are produced to assess compliance with cGMP requirements and to assure that the facilities, methods, and controls are adequate to preserve the product’s identity, strength, quality, and purity, and, if applicable, the FDA’s current good tissue practice (“GTP”) for the use of human cellular and tissue products; • satisfactory completion of any FDA audits of the non-clinical and clinical trial sites to assure compliance with GCPs and the integrity of clinical data in support of the BLA; • payment of user Prescription Drug User Free Act (“PDUFA”) securing FDA approval of the BLA and licensure of the new biologic product; and • compliance with any post-approval requirements, including the potential requirement to implement a Risk Evaluation and Mitigation Strategy (“REMS”) and any post-approval studies required by the FDA.
The failure to comply with the applicable U.S. requirements at any time during the product development process, including non-clinical testing, clinical testing, the approval process or post-approval process, may subject a sponsor to delays in the conduct of the study, regulatory review and approval, and/or administrative or judicial sanctions. 23 Table of Contents A sponsor seeking approval to market and distribute a new biologic in the United States generally must satisfactorily complete each of the following steps: • preclinical laboratory tests, animal studies and formulation studies all performed in accordance with the FDA’s Good Laboratory Practice (“GLP”) regulations and standards; • completion of the manufacture, under current Good Manufacturing Practices (“cGMP”) conditions, of the drug substance and drug product that the sponsor intends to use in human clinical trials along with required analytical and stability testing; • design of a clinical protocol and submission to the FDA of an Investigational New Drug application (“IND”) for human clinical testing, which must become effective before human clinical trials may begin; • approval by an independent institutional review board (“IRB”) representing each clinical site before each clinical trial may be initiated; • performance of adequate and well-controlled human clinical trials to establish the safety, potency, and purity of the product candidate for each proposed indication, in accordance with current Good Clinical Practices (“GCP”); • preparation and submission to the FDA of a Biologic License Application (“BLA”) for a biologic product requesting marketing for one or more proposed indications, including submission of detailed information on the manufacture and composition of the product in clinical development and proposed labelling; • review of the product by an FDA advisory committee, where appropriate or if applicable; • satisfactory completion of one or more FDA inspections of the manufacturing facility or facilities, including those of third parties, at which the product, or components thereof, are produced to assess compliance with cGMP requirements and to assure that the facilities, methods, and controls are adequate to preserve the product’s identity, strength, quality, and purity, and, if applicable, the FDA’s current good tissue practice (“GTP”) for the use of human cellular and tissue products; • satisfactory completion of any FDA audits of the non-clinical and clinical trial sites to assure compliance with GCPs and the integrity of clinical data in support of the BLA; • payment of application and program fees pursuant to the Prescription Drug User Free Act (“PDUFA”) securing FDA approval of the BLA and licensure of the new biologic product; and • compliance with any post-approval requirements, including the potential requirement to implement a Risk Evaluation and Mitigation Strategy (“REMS”) and any post-approval studies required by the FDA.
Broad may not grant a Cpf1 Third Party Proposed Product Request (i) if we, directly or through any of our affiliates, sublicensees, or collaborators are researching, developing, or commercializing a product directed to the same gene target that is the subject of the Cpf1Third Party Proposed Product Request (“Cpf1 Licensee 18 Table of Contents Product”) and we can demonstrate such ongoing efforts to Broad’s reasonable satisfaction, or (ii) if we, directly or through any of our affiliates or sublicensees, wish to do so either alone or with a collaboration partner, and we can demonstrate to Broad’s reasonable satisfaction that we are interested in researching, developing, and commercializing a Cpf1 Licensee Product, that we have a commercially reasonable research, development, and commercialization plan to do so, and we commence and continue reasonable commercial efforts under such plan.
Broad may not grant a Cpf1 Third Party Proposed Product Request (i) if we, directly or through any of our affiliates, sublicensees, or collaborators are researching, developing, or commercializing a product directed to the same gene target that is the subject of the Cpf1Third Party Proposed Product Request (“Cpf1 Licensee Product”) and we can demonstrate such ongoing efforts to Broad’s reasonable satisfaction, or (ii) if we, directly or through any of our affiliates or sublicensees, wish to do so either alone or with a collaboration partner, and we can demonstrate to Broad’s reasonable satisfaction that we are interested in researching, developing, and commercializing a Cpf1 Licensee Product, that we have a commercially reasonable research, development, and commercialization plan to do so, and we commence and continue reasonable commercial efforts under such plan.
Specifically, the grant of marketing authorization in the European Union for products containing viable human tissues or cells such as gene therapy medicinal products is governed by Regulation 1394/2007/EC on advanced therapy medicinal products, read in combination with Directive 2001/83/EC of the European Parliament and of the Council, commonly known as the Community code on medicinal products.
Specifically, the grant of marketing authorization in the EU for products containing viable human tissues or cells such as gene therapy medicinal products is governed by Regulation 1394/2007/EC on advanced therapy medicinal products, read in combination with Directive 2001/83/EC of the European Parliament and of the Council, commonly known as the Community code on medicinal products.
We make these reports available through our website as soon as reasonably practicable after we electronically file such reports with, or furnish such reports to, the Securities and Exchange Commission (the “SEC”). You can review our electronically filed reports and other information that we file with the SEC on the SEC’s web site at http://www.sec.gov.
We make these reports available through our website as soon as reasonably practicable after we electronically file such reports with, or furnish such reports to, the U.S. Securities and Exchange Commission (the “SEC”). You can review our electronically filed reports and other information that we file with the SEC on the SEC’s web site at http://www.sec.gov.
In that case, the IND sponsor and the FDA must resolve any outstanding FDA concerns before the clinical trials can begin or recommence. 25 Table of Contents As a result, submission of the IND may result in the FDA not allowing the trials to commence or allowing the trial to commence on the terms originally specified by the sponsor in the IND.
In that case, the IND sponsor and the FDA must resolve any outstanding FDA concerns before the clinical trials can begin or recommence. 24 Table of Contents As a result, submission of the IND may result in the FDA not allowing the trials to commence or allowing the trial to commence on the terms originally specified by the sponsor in the IND.
Specifically, the FDA requires that such trials be conducted in accordance with GCP, including review and approval by an independent ethics committee and informed consent from subjects. The 26 Table of Contents GCP requirements encompass both ethical and data integrity standards for clinical trials.
Specifically, the FDA requires that such trials be conducted in accordance 25 Table of Contents with GCP, including review and approval by an independent ethics committee and informed consent from subjects. The GCP requirements encompass both ethical and data integrity standards for clinical trials.
Specialized Procedures for Gene Therapies The grant of marketing authorization in the European Union for gene therapy products is governed by Regulation 1394/2007/EC on advanced therapy medicinal products, read in combination with Directive 2001/83/EC of the European Parliament and of the Council, commonly known as the Community code on medicinal products.
Specialized Procedures for Gene Therapies The grant of marketing authorization in the EU for gene therapy products is governed by Regulation 1394/2007/EC on advanced therapy medicinal products, read in combination with Directive 2001/83/EC of the European Parliament and of the Council, commonly known as the Community code on medicinal products.
In markets outside of the U.S. and the E.U., reimbursement and healthcare payment systems vary significantly by country and many countries have instituted price ceilings on specific products and therapies. In many countries, including those of the E.U., the pricing of prescription pharmaceuticals is subject to governmental control and access.
In markets outside of the U.S. and the EU, reimbursement and healthcare payment systems vary significantly by country and many countries have instituted price ceilings on specific products and therapies. In many countries, including those of the EU, the pricing of prescription pharmaceuticals is subject to governmental control and access.
Failure to exhibit due diligence with regard to conducting Phase 4 clinical trials could result in withdrawal of approval for products. 27 Table of Contents In December 2022, with the passage of Food and Drug Omnibus Reform Act (“FDORA”), Congress required sponsors to develop and submit a diversity action plan for each phase 3 clinical trial or any other “pivotal study” of a new drug or biological product.
Failure to exhibit due diligence with regard to conducting Phase 4 clinical trials could result in withdrawal of approval for products. 26 Table of Contents In December 2022, with the passage of Food and Drug Omnibus Reform Act (“FDORA”), Congress required sponsors to develop and submit a diversity action plan (“DAP”) for each phase 3 clinical trial or any other “pivotal study” of a new drug or biological product.
These changes included aggregate reductions to Medicare payments to providers of up to 2% per fiscal year, which went into effect in April 2013 and will remain in effect through 2031 pursuant to the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”).
These changes included aggregate reductions to Medicare payments to providers of up to 2% per fiscal year, which went into effect in April 2013 and will remain in effect through 2031 pursuant to the Coronavirus Aid, Relief and Economic Security Act.
The myeloablative busulfan conditioning regimen for HSC transplantation that is necessary for current gene editing therapies for SCD and TDT requires that patients undergo immunosuppression at the time of transplant and carries with it the long-term burdens of infertility and oncogenesis.
The myeloablative busulfan conditioning regimen for ex vivo HSC transplantation that is necessary for current gene editing therapies for SCD and TDT requires that patients undergo immunosuppression at the time of transplant and carries with it the long-term burdens of infertility and oncogenesis.
Under the Cpf1 License Agreement, Broad and Wageningen are also entitled, collectively, to receive success payments in the event our market capitalization reaches specified thresholds ascending from a high nine digit dollar amount to $10.0 billion (“Market Cap Success Payments”) or sale of our company for consideration in excess of those thresholds, (“Company Sale Success Payments,” which with the Market Cap Success Payments, the “Success Payments”).
Under the Cpf1 License Agreement, Broad and Wageningen are also entitled, collectively, to receive success payments in the event our market capitalization reaches specified thresholds ascending from a high nine digit dollar amount to $10.0 billion (“Market Cap Success Payments”) or sale of our company for consideration in excess of those thresholds, 18 Table of Contents (“Company Sale Success Payments,” which with the Market Cap Success Payments, the “Success Payments”).
In September 2021, the FDA published final regulations which describe the types of evidence that the agency will consider in determining the intended use of a drug or biologic. It may be permissible, under very specific, narrow conditions, for a manufacturer to engage in nonpromotional, non-misleading communication regarding off-label information, such as distributing scientific or medical journal information.
In September 2021, the FDA published final regulations which describe the types of evidence that the agency will consider in determining the intended use of a drug or biologic. 32 Table of Contents It may be permissible, under very specific, narrow conditions, for a manufacturer to engage in nonpromotional, non-misleading communication regarding off-label information, such as distributing scientific or medical journal information.
Government Regulation and Licensure of Products Government authorities in the United States, at the federal, state and local level, and in other countries and jurisdictions, including the European Union, extensively regulate, among other things, the research, development, testing, manufacture, pricing, reimbursement, sales, quality control, approval, packaging, storage, recordkeeping, labeling, advertising, promotion, distribution, marketing, post-approval monitoring and reporting, and import and export of pharmaceutical products, including biological products.
Government Regulation and Licensure of Products Government authorities in the United States, at the federal, state and local level, and in other countries and jurisdictions, including the EU, extensively regulate, among other things, the research, development, testing, manufacture, pricing, reimbursement, sales, quality control, approval, packaging, storage, recordkeeping, labeling, advertising, promotion, distribution, marketing, post-approval monitoring and reporting, and import and export of pharmaceutical products, including biological products.
In addition to California, at least eleven other states have passed comprehensive privacy laws similar to the CCPA and CPRA. These laws are either in effect or will go into effect sometime before the end of 2026.
In addition to California, at least eighteen other states have passed comprehensive privacy laws similar to the CCPA and CPRA. These laws are either in effect or will go into effect sometime before the end of 2026.
Market Cap 19 Table of Contents Success Payments are payable by us in cash, in shares of our common stock, with such shares being valued for such purpose at the closing price of our common stock as reported the Nasdaq Stock Market for the trading day immediately preceding the date of such payment if our common stock was then listed on the Nasdaq Stock Market, or in the form of promissory notes (the “Promissory Notes”).
Market Cap Success Payments are payable by us in cash, in shares of our common stock, with such shares being valued for such purpose at the closing price of our common stock as reported the Nasdaq Stock Market for the trading day immediately preceding the date of such payment if our common stock was then listed on the Nasdaq Stock Market, or in the form of promissory notes (the “Promissory Notes”).
If issued as U.S. patents, and if the appropriate maintenance fees are paid, the U.S. patent applications would be expected to expire between 2034 and 2044, excluding any additional term for patent term adjustments or patent term extensions.
If issued as U.S. patents, and if the appropriate maintenance fees are paid, the U.S. patent applications would be expected to expire between 2034 and 2045, excluding any additional term for patent term adjustments or patent term extensions.
This group may recommend continuation of the study as planned, changes in study conduct, or cessation of the study at designated check points based on certain available data from the study to which only the DSMB has access.
This group may recommend continuation of the study as planned, changes in study conduct, or cessation of the study at designated check points based on certain available data from the study to which only the DMC has access.
State and foreign laws also govern the privacy and security of health information in some circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts. 43 Table of Contents Healthcare Reform A primary trend in the U.S. healthcare industry and elsewhere is cost containment.
State and foreign laws also govern the privacy and security of health information in some circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts. Healthcare Reform A primary trend in the U.S. healthcare industry and elsewhere is cost containment.
Regulation (EC) No 1901/2006 provides that prior to obtaining a marketing authorization in the European Union, a sponsor must demonstrate compliance with all measures included in an EMA-approved PIP, covering all subsets of the pediatric population, unless the EMA has granted a product-specific waiver, class waiver, or a deferral for one or more of the measures included in the PIP.
Regulation (EC) No 1901/2006 provides that prior to obtaining a marketing authorization in the EU, a sponsor must demonstrate compliance with all measures included in an EMA-approved PIP, covering all subsets of the pediatric population, unless the EMA has granted a product-specific waiver, class waiver, or a deferral for one or more of the measures included in the PIP.
Regulatory Requirements after Marketing Authorization Following approval, the holder of the marketing authorization is required to comply with a range of requirements applicable to the manufacturing, marketing, promotion and sale of the medicinal product. These include compliance with the European Union’s stringent pharmacovigilance or safety reporting rules, pursuant to which post-authorization studies and additional monitoring obligations can be imposed.
Regulatory Requirements after Marketing Authorization Following approval, the holder of the marketing authorization is required to comply with a range of requirements applicable to the manufacturing, marketing, promotion and sale of the medicinal product. These include compliance with the EU’s stringent pharmacovigilance or safety reporting rules, pursuant to which post-authorization studies and additional monitoring obligations can be imposed.
In addition, the manufacturing of authorized products, for which a separate manufacturer’s license is mandatory, must also be conducted in strict compliance with the EMA’s GMP requirements and comparable requirements of other regulatory bodies in the European Union, which mandate the methods, facilities, and controls used in manufacturing, processing and packing of drugs to assure their safety and identity.
In addition, the manufacturing of authorized products, for which a separate manufacturer’s license is mandatory, must also be conducted in strict compliance with the EMA’s GMP requirements and comparable requirements of other regulatory bodies in the EU, which mandate the methods, facilities, and controls used in manufacturing, processing and packing of drugs to assure their safety and identity.
Under the terms of the BMS Collaboration Agreement, we received an upfront payment of $25.0 million, amendment fees totaling $75.0 million and have received milestone payments totaling $20.0 million, in addition to certain opt-in fees.
Under the terms of the BMS Collaboration Agreement, we received an upfront payment of $25.0 million, amendment fees totaling $75.0 million and have received milestone payments totaling $30.0 million, in addition to certain opt-in fees.
Our current issued U.S. patents, if the appropriate maintenance fees are paid, are expected to expire between 2034 and 2038, excluding any additional term for patent term adjustments or patent term extensions.
Our current issued U.S. patents, if the appropriate maintenance fees are paid, are expected to expire between 2034 and 2039, excluding any additional term for patent term adjustments or patent term extensions.
Item 1. Business We are a clinical stage genome editing company dedicated to developing potentially transformative genomic medicines to treat a broad range of serious diseases. The promise of genomic medicines is supported by the advancing knowledge of the human genome and by harnessing the progress in technologies for cell therapy, gene therapy, and, most recently, gene editing.
Item 1. Business We are a pioneering gene editing company dedicated to developing potentially transformative genomic medicines to treat a broad range of serious diseases. The promise of genomic medicines is supported by the advancing knowledge of the human genome and by harnessing the progress in technologies for cell therapy, gene therapy, and, most recently, gene editing.
The licenses granted to us under the Cpf1 License Agreement exclude certain fields, including human germline modification; the stimulation of biased inheritance of particular genes or traits within a population of plants or animals; the research, development, manufacturing, or commercialization of sterile seeds; and the modification of the tobacco plant with specified exceptions.
The licenses granted to us under the Cpf1 License Agreement exclude certain fields, including human germline modification; the stimulation of biased inheritance of particular genes or traits within a population of plants or animals; the research, development, manufacturing, or commercialization of sterile seeds; and the modification of the tobacco plant with specified exceptions. Tokyo and the U.S.
In these countries, pricing negotiations with governmental authorities can take considerable time after the receipt of marketing approval for a product. To obtain reimbursement or pricing approval in some countries, pharmaceutical firms may be required to conduct a clinical trial that compares the cost-effectiveness of the product to other available therapies.
In these countries, pricing negotiations with governmental authorities can take considerable time after the receipt of marketing approval for a product. To obtain reimbursement or 39 Table of Contents pricing approval in some countries, pharmaceutical firms may be required to conduct a clinical trial that compares the cost-effectiveness of the product to other available therapies.
It also requires the submission to the relevant competent authorities of a marketing authorization application (“MAA”) and granting of a marketing authorization by these authorities before the product can be marketed and sold in the European Union. Non-clinical Studies Non-clinical studies are performed to demonstrate the health or environmental safety of new chemical or biological substances.
It also requires the submission to the relevant competent authorities of a marketing authorization application (“MAA”) and granting of a marketing authorization by these authorities before the product can be marketed and sold in the EU. Non-clinical Studies Non-clinical studies are performed to demonstrate the health or environmental safety of new chemical or biological substances.
Any product candidates that we successfully develop and commercialize may compete with existing therapies and new therapies may become available in the future. We compete in the segments of the pharmaceutical, biotechnology, and other related markets that utilize technologies encompassing genomic medicines to create therapies, including genome editing and gene therapy.
Any product candidates that we successfully develop and commercialize may compete with existing therapies and new therapies may become available in the future. 21 Table of Contents We compete in the segments of the pharmaceutical, biotechnology, and other related markets that utilize technologies encompassing genomic medicines to create therapies, including genome editing and gene therapy.
The use of 23 Table of Contents contracted manufacturing and reliance on collaboration partners is relatively cost-efficient and has eliminated the need for substantial direct investment in manufacturing facilities and additional staff. Although we rely on contract manufacturers for certain materials, we have personnel with manufacturing experience to oversee our contract manufacturers.
The use of contracted manufacturing and reliance on collaboration partners is relatively cost-efficient and has eliminated the need for substantial direct investment in manufacturing facilities and additional staff. Although we rely on contract manufacturers for certain materials, we have personnel with manufacturing experience to oversee our contract manufacturers.
We believe the therapeutic programs and delivery technologies we have chosen to pursue to date and those that are currently under development will demonstrate the depth 9 Table of Contents and breadth of our ability to deploy our genome editing platform to develop differentiated, transformational medicines for previously untreatable diseases.
We believe the therapeutic programs and delivery technologies we have chosen to pursue to date and those that are currently under development will demonstrate the depth and breadth of our ability to deploy our genome editing platform to develop differentiated, transformational medicines for previously untreatable diseases.
A product becomes an orphan when it receives orphan drug designation from the Office of Orphan Products Development at the FDA based on acceptable 33 Table of Contents confidential requests made under the regulatory provisions. The product must then go through the review and approval process like any other product.
A product becomes an orphan when it receives orphan drug designation from the Office of Orphan Products Development at the FDA based on acceptable confidential requests made under the regulatory provisions. The product must then go through the review and approval process like any other product.
Patent term restoration cannot be used to extend the remaining term of a patent past a total of 14 years from the product’s approval date. Only one patent applicable to an approved product is eligible for the extension, and the application for the extension must be submitted prior to the expiration of the patent in question.
Patent term restoration cannot be used to extend the remaining term of a patent past a total of 14 years from the product’s approval date. Only one patent applicable to an approved product is eligible for 34 Table of Contents the extension, and the application for the extension must be submitted prior to the expiration of the patent in question.
Arrangements with providers, consultants, third-party payors, and customers are subject to broadly applicable fraud and abuse, anti-kickback, false claims laws, reporting of payments to physicians and teaching physicians and patient privacy laws and regulations and other healthcare laws and regulations that 42 Table of Contents may constrain our business and/or financial arrangements.
Arrangements with providers, consultants, third-party payors, and customers are subject to broadly applicable fraud and abuse, anti-kickback, false claims laws, reporting of payments to physicians and teaching physicians and patient privacy laws and regulations and other healthcare laws and regulations that may constrain our business and/or financial arrangements.
Broad and Wageningen are collectively entitled to receive clinical and regulatory milestone payments totaling up to $6.0 million in the aggregate per licensed product approved in the United States, the European Union and Japan for the prevention or treatment of an ultra-orphan disease.
Broad and Wageningen are collectively entitled to receive clinical and regulatory milestone payments totaling up to $6.0 million in the aggregate per licensed product approved in the United States, the EU and Japan for the prevention or treatment of an ultra-orphan disease.
With passage of FDORA, Congress clarified FDA’s authority to conduct inspections by expressly permitting inspection of facilities involved in the preparation, conduct, or analysis of clinical and non-clinical studies submitted to FDA as well as other persons holding study records or involved in the study process.
With passage of FDORA, Congress clarified the FDA’s authority to conduct inspections by 29 Table of Contents expressly permitting inspection of facilities involved in the preparation, conduct, or analysis of clinical and non-clinical studies submitted to the FDA as well as other persons holding study records or involved in the study process.
After approval, many types of changes to the approved product, such as adding new indications, manufacturing changes and additional labeling claims, are subject to further testing requirements and FDA review and approval. Expedited Review Programs The FDA is authorized to expedite the review of applications in several ways.
After approval, many types of changes to the approved product, such as adding new indications, manufacturing changes and additional labeling claims, are subject to further testing requirements and FDA review and approval. 30 Table of Contents Expedited Review Programs The FDA is authorized to expedite the review of applications in several ways.
The process governing approval of medicinal products in the European Union generally follows the same lines as in the United States. It entails satisfactory completion of preclinical studies and adequate and well-controlled clinical trials to establish the safety and efficacy of the product for each proposed indication.
The process governing approval of medicinal products in the EU generally follows the same lines as in the United States. It entails satisfactory completion of preclinical studies and adequate and well-controlled clinical trials to establish the safety and efficacy of the product for each proposed indication.
For either of these conditions, the sponsor must demonstrate that there exists no satisfactory method of diagnosis, prevention, or treatment of the condition in question that has been authorized in the European Union or, if such method exists, the drug will be of significant benefit to those affected by that condition.
For either of these conditions, the sponsor must demonstrate that there exists no satisfactory method of diagnosis, prevention, or treatment of the condition in question that has been authorized in the EU or, if such method exists, the drug will be of significant benefit to those affected by that condition.
For hemoglobinopathies, these companies include Acceleron Pharma, Agios Pharmaceuticals, Global Blood Therapeutics, Novartis Pharmaceuticals, and Vertex. In addition, many of our current or potential competitors, either alone or with their collaboration partners, may have greater financial resources and expertise in research and development, manufacturing, preclinical testing, conducting clinical trials, and marketing approved products than we do.
For hemoglobinopathies, these companies include Acceleron Pharma, Agios Pharmaceuticals, Novartis Pharmaceuticals, Pfizer, and Vertex. In addition, many of our current or potential competitors, either alone or with their collaboration partners, may have greater financial resources and expertise in research and development, manufacturing, preclinical testing, conducting clinical trials, and marketing approved products than we do.
If we cease payment for the prosecution of any Harvard/Broad Patent Right, then any license granted to us with respect to such Harvard/Broad Patent Right will terminate.
If we cease payment for the prosecution of any Harvard/Broad Cas9-I Patent Right, then any license granted to us with respect to such Harvard/Broad Cas9-I Patent Right will terminate.
The FDA will seek to ensure the sponsor of a Breakthrough Therapy product candidate receives intensive guidance on an efficient development program, intensive 31 Table of Contents involvement of senior managers and experienced staff on a proactive, collaborative and cross-disciplinary review and rolling review. • Priority review.
The FDA will seek to ensure the sponsor of a Breakthrough Therapy product candidate receives intensive guidance on an efficient development program, intensive involvement of senior managers and experienced staff on a proactive, collaborative and cross-disciplinary review and rolling review. • Priority review.
Broad and Harvard are required to maintain any application or patent within the Harvard/Broad Patents Rights so long as we meet our obligation to reimburse Broad and Harvard for expenses related to prosecution and there is a good faith basis for doing so.
Broad and Harvard are required to maintain any application or patent within the Harvard/Broad Cas9-I Patent Rights so long as we meet our obligation to reimburse Broad and Harvard for expenses related to prosecution and there is a good faith basis for doing so.
The PHSA emphasizes the importance of manufacturing control for products like biologics whose attributes cannot be precisely defined. For a gene therapy product, the FDA also will not approve the product if the manufacturer is not in compliance with GTP.
The PHSA emphasizes the importance of manufacturing control for products like biologics whose attributes cannot be precisely defined. 28 Table of Contents For a gene therapy product, the FDA also will not approve the product if the manufacturer is not in compliance with GTP.
In its 2014 guidance, the FDA stated that if evidence is sufficient to conclude that the companion diagnostic is appropriate for use with 35 Table of Contents a specific group of therapeutic products, the companion diagnostic’s intended use/indications for use should name the specific group of therapeutic products, rather than specific products.
In its 2014 guidance, the FDA stated that if evidence is sufficient to conclude that the companion diagnostic is appropriate for use with a specific group of therapeutic products, the companion diagnostic’s intended use/indications for use should name the specific group of therapeutic products, rather than specific products.
Under the centralized procedure in the European Union, the maximum timeframe for the evaluation of an MAA is 210 days, excluding clock stops when additional information or written or oral explanation is to be provided by the sponsor in response to questions of the CHMP.
Under the centralized procedure in the EU, the maximum timeframe for the evaluation of an MAA is 210 days, excluding clock stops when additional information or written or oral explanation is to be provided by the sponsor in response to questions of the CHMP.
In the health care industry generally, under HIPAA, the HHS has issued regulations to protect the privacy and security of protected health information (“PHI”) used or disclosed by covered entities including certain healthcare providers, health plans and healthcare clearinghouses.
In the health care industry generally, under HIPAA, the 45 Table of Contents HHS has issued regulations to protect the privacy and security of protected health information (“PHI”) used or disclosed by covered entities including certain healthcare providers, health plans and healthcare clearinghouses.
Manufacturers and others involved in the manufacture and distribution of products must also register their establishments with the FDA and certain state agencies. Both domestic and foreign manufacturing establishments must 29 Table of Contents register and provide additional information to the FDA upon their initial participation in the manufacturing process.
Manufacturers and others involved in the manufacture and distribution of products must also register their establishments with the FDA and certain state agencies. Both domestic and foreign manufacturing establishments must register and provide additional information to the FDA upon their initial participation in the manufacturing process.
Finally, the marketing and promotion of authorized products, including industry-sponsored continuing medical education and advertising directed toward the prescribers of drugs and/or the general public, are strictly regulated in the European Union under Directive 2001/83EC, as amended.
Finally, the marketing and promotion of authorized products, including industry-sponsored continuing medical education and advertising directed toward the prescribers of drugs and/or the general public, are strictly regulated in the EU under Directive 2001/83EC, as amended.
HIPAA may apply to us in certain circumstances and may also apply to our business partners in ways that may impact our relationships with them. Our clinical trials are regulated by the Common Rule, which also includes specific privacy-related provisions.
HIPAA may apply to us in certain circumstances and may also apply to our business partners in ways that may impact our relationships with them. Our clinical trials will be regulated by the Common Rule, which also includes specific privacy-related provisions.
The BLA must contain extensive manufacturing information and detailed information on the composition of the product and proposed labeling as well as payment of a user fee. Under federal law, the submission of most BLAs is subject to an application user fee, which for federal fiscal year 2024 is approximately $4.05 million for an application requiring clinical data.
The BLA must contain extensive manufacturing information and detailed information on the composition of the product and proposed labeling as well as payment of a user fee. Under federal law, the submission of most BLAs is subject to an application user fee, which for federal fiscal year 2025 is approximately $4.3 million for an application requiring clinical data.
This draft guidance calls for such communications to be truthful, non-misleading, factual, and unbiased and include all information necessary for healthcare providers to interpret the strengths and weaknesses and validity and utility of the information about the unapproved use If a company is found to have promoted off-label uses, it may become subject to adverse public relations and administrative and judicial enforcement by the FDA, the Department of Justice, or the Office of the Inspector General of the Department of Health and Human Services, as well as state authorities.
This final guidance calls for such communications to be truthful, non-misleading, factual, and unbiased and include all information necessary for healthcare providers to interpret the strengths and weaknesses and validity and utility of the information about the unapproved use If a company is found to have promoted off-label uses, it may become subject to adverse public relations and administrative and judicial enforcement by the FDA, the Department of Justice, or the Office of the Inspector General of the HHS, as well as state authorities.
An orphan drug designation provides a number of benefits, including fee reductions, regulatory assistance, and the possibility to apply for a centralized European Union marketing authorization. Marketing authorization for an orphan drug 39 Table of Contents leads to a ten-year period of market exclusivity.
An orphan drug designation provides a number of benefits, including fee reductions, regulatory assistance, and the possibility to apply for a centralized European Union marketing authorization. Marketing authorization for an orphan drug leads to a ten-year period of market exclusivity.
Our strategy is to leverage existing delivery technologies to target cell types of interest while developing next generation capabilities as warranted. We have developed a variety of delivery approaches, including electroporation for efficient delivery to blood cells ex vivo , lipid nanoparticles for non-viral in vivo delivery, and AAVs for in vivo viral delivery.
Our strategy is to leverage existing delivery technologies to target cell types of interest while developing next generation capabilities as warranted. We have developed a variety of delivery approaches, including lipid nanoparticles for non-viral in vivo delivery, AAVs for in vivo viral delivery, and electroporation for efficient delivery to blood cells ex vivo for our former reni-cel program.
To address more than one target, other gene editing technologies require the engineering, characterization, manufacture, and delivery of distinct nuclease proteins for each target. • Ability to achieve a range of different types of edits.
To address more than one 8 Table of Contents target, other gene editing technologies require the engineering, characterization, manufacture, and delivery of distinct nuclease proteins for each target. • Ability to achieve a range of different types of edits.
The European Commission grants or refuses marketing authorization in light of the opinion delivered by EMA. Under the centralized procedure, the CHMP established at the EMA is responsible for conducting an initial assessment of a product.
The European Commission grants or refuses marketing authorization in light of the opinion delivered by EMA. 37 Table of Contents Under the centralized procedure, the CHMP established at the EMA is responsible for conducting an initial assessment of a product.
During the additional two-year period of market exclusivity, a generic marketing authorization application can be submitted, and the innovator’s data may be referenced, but no generic medicinal product 38 Table of Contents can be marketed until the expiration of the market exclusivity.
During the additional two-year period of market exclusivity, a generic marketing authorization application can be submitted, and the innovator’s data may be referenced, but no generic medicinal product can be marketed until the expiration of the market exclusivity.
In addition, the HHS and the FDA published a final rule allowing states and other entities to develop a Section 804 Importation Program (“SIP”) to import certain prescription drugs from Canada into the United States.
In October 2020, the HHS and the FDA published a final rule allowing states and other entities to develop a Section 804 Importation Program (“SIP”) to import certain prescription drugs from Canada into the United States.
Tokyo and the National Institute of Health (“NIH”) are joint owners on certain Cpf1 Patent Rights. Broad has only granted a license to us with respect to its interests and to Tokyo’s interests in these U.S. patent applications but not to any foreign equivalents thereof.
National Institutes of Health (“NIH”) are joint owners on certain Cpf1 Patent Rights. Broad has only granted a license to us with respect to its interests and to Tokyo’s interests in these U.S. patent applications but not to any foreign equivalents thereof.
Under the Cas9-II Agreement and the Sponsored Research Agreement, we have potential obligations with respect to success payments, which are described in Note 8 to the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.
Under the Cas9-II Agreement and the Sponsored Research Agreement, we have potential obligations with respect to success payments, which are described in Note 8 to the Notes to Consolidated Financial Statements included in Part II, Item 8 “Financial Statements and Supplementary Data” of this Annual Report on Form 10-K.
While we have limited clinical manufacturing capabilities, at the appropriate time in the product development process of each product candidate, we will determine whether to expand our internal manufacturing capabilities or rely on third parties to manufacture commercial quantities of any products that we may successfully develop and have approved.
At the appropriate time in the product development of each product candidate, we will determine whether to expand our internal manufacturing capabilities or rely on third parties to manufacture commercial quantities of any products that we may successfully develop and have approved.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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We or our collaborators may experience numerous unforeseen events during, or as a result of, clinical trials that could delay or prevent our ability to receive marketing approval or commercialize any product candidates we may identify and develop, including: • delays in reaching a consensus with regulators on trial design; • regulators, IRBs or independent ethics committees (“IECs”) not authorizing us or our investigators to commence a clinical trial or conduct a clinical trial at a prospective trial site; • delays in reaching or failing to reach agreement on acceptable clinical trial contracts or clinical trial protocols with prospective contract research organizations (“CROs”) and clinical trial sites; • clinical trials of any product candidates we develop producing negative or inconclusive results, and us deciding, or regulators requiring us, to conduct additional clinical trials or abandon product development or research programs; • the number of patients required for clinical trials of any product candidates we develop may be larger than we anticipate; the number of subjects willing to enroll may be smaller than required; enrollment of suitable participants in these clinical trials may be delayed or slower than we anticipate; or patients may drop out of these clinical trials at a higher rate than we anticipate; • our third-party contractors failing to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all; • regulators, IRBs, or IECs requiring that we or our investigators suspend or terminate clinical research or clinical trials of any product candidates we develop for various reasons, including noncompliance with regulatory requirements, a finding of undesirable side effects or other unexpected characteristics, or that the 58 Table of Contents participants are being exposed to unacceptable health risks or after an inspection of our clinical trial operations or trial sites; • the supply or quality of any product candidates we develop or other materials necessary to conduct clinical trials of any product candidates we develop being insufficient or inadequate, including as a result of delays in the testing, validation, manufacturing, and delivery of any product candidates we develop to the clinical sites by us or by third parties with whom we have contracted to perform certain of those functions; • occurrence of serious adverse events associated with any product candidates we develop that are viewed to outweigh their potential benefits; and • changes in regulatory requirements and guidance that require amending or submitting new clinical protocols.
We or our collaborators may experience numerous unforeseen events during, or as a result of, clinical trials that could delay or prevent our ability to receive marketing approval or commercialize any product candidates we may identify and develop, including: • delays in reaching a consensus with regulators on trial design; • regulators, IRBs or independent ethics committees (“IECs”) not authorizing us or our investigators to commence a clinical trial or conduct a clinical trial at a prospective trial site; • delays in reaching or failing to reach agreement on acceptable clinical trial contracts or clinical trial protocols with prospective contract research organizations (“CROs”) and clinical trial sites; • clinical trials of any product candidates we develop producing negative or inconclusive results, and us deciding, or regulators requiring us, to conduct additional clinical trials or abandon product development or research programs; • the number of patients required for clinical trials of any product candidates we develop may be larger than we anticipate; the number of subjects willing to enroll may be smaller than required; enrollment of suitable participants in these clinical trials may be delayed or slower than we anticipate; or patients may drop out of these clinical trials at a higher rate than we anticipate; • our third-party contractors failing to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all; • regulators, IRBs, or IECs requiring that we or our investigators suspend or terminate clinical research or clinical trials of any product candidates we develop for various reasons, including noncompliance with regulatory requirements, a finding of undesirable side effects or other unexpected characteristics, or that the participants are being exposed to unacceptable health risks or after an inspection of our clinical trial operations or trial sites; • the supply or quality of any product candidates we develop or other materials necessary to conduct clinical trials of any product candidates we develop being insufficient or inadequate, including as a result of delays in the testing, validation, manufacturing, and delivery of any product candidates we develop to the clinical sites by us or by third parties with whom we have contracted to perform certain of those functions; • occurrence of serious adverse events associated with any product candidates we develop that are viewed to outweigh their potential benefits; and 58 Table of Contents • changes in regulatory requirements and guidance that require amending or submitting new clinical protocols.
Collaborations involving our research programs or any of our product candidates and alliance arrangements we may enter into under which our research programs or product candidates may be involved pose the following risks to us: • Collaborators may have significant discretion in determining the efforts and resources that they will apply to these collaborations. • Collaborators may not pursue development and commercialization of any product candidates we develop or may elect not to continue or renew development or commercialization programs based on clinical trial results, changes in the collaborator’s strategic focus or available funding or external factors such as an acquisition that diverts resources or creates competing priorities. • Collaborators may delay clinical trials, provide insufficient funding for a clinical trial program, stop a clinical trial or abandon a product candidate, repeat or conduct new clinical trials, or require a new formulation of a product candidate for clinical testing. • Collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with our medicines or product candidates if the collaborators believe that competitive products are more likely to be successfully developed or can be commercialized under terms that are more economically attractive than ours. 68 Table of Contents • Collaborators with marketing and distribution rights to one or more medicines may not commit sufficient resources to the marketing and distribution of such medicine or medicines. • Collaborators may not properly obtain, maintain, enforce, or defend our intellectual property or proprietary rights or may use our proprietary information in such a way as to invite litigation that could jeopardize or invalidate our proprietary information or expose us to potential litigation. • Disputes may arise between the collaborators and us that result in the delay or termination of the research, development, or commercialization of our medicines or product candidates or that result in costly litigation or arbitration that diverts management attention and resources. • We may lose certain valuable rights under circumstances identified in our collaborations, including if we undergo a change of control. • Collaborations may be terminated and, if terminated, may result in a need for additional capital to pursue further development or commercialization of the applicable product candidates. • Collaboration agreements may not lead to development or commercialization of product candidates in the most efficient manner or at all.
Collaborations involving our research programs or any of our product candidates and alliance arrangements we may enter into under which our research programs or product candidates may be involved pose the following risks to us: • Collaborators may have significant discretion in determining the efforts and resources that they will apply to these collaborations. • Collaborators may not pursue development and commercialization of any product candidates we develop or may elect not to continue or renew development or commercialization programs based on clinical trial results, changes in the collaborator’s strategic focus or available funding or external factors such as an acquisition that diverts resources or creates competing priorities. • Collaborators may delay clinical trials, provide insufficient funding for a clinical trial program, stop a clinical trial or abandon a product candidate, repeat or conduct new clinical trials, or require a new formulation of a product candidate for clinical testing. • Collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with our medicines or product candidates if the collaborators believe that competitive products are more likely to be successfully developed or can be commercialized under terms that are more economically attractive than ours. • Collaborators with marketing and distribution rights to one or more medicines may not commit sufficient resources to the marketing and distribution of such medicine or medicines. 68 Table of Contents • Collaborators may not properly obtain, maintain, enforce, or defend our intellectual property or proprietary rights or may use our proprietary information in such a way as to invite litigation that could jeopardize or invalidate our proprietary information or expose us to potential litigation. • Disputes may arise between the collaborators and us that result in the delay or termination of the research, development, or commercialization of our medicines or product candidates or that result in costly litigation or arbitration that diverts management attention and resources. • We may lose certain valuable rights under circumstances identified in our collaborations, including if we undergo a change of control. • Collaborations may be terminated and, if terminated, may result in a need for additional capital to pursue further development or commercialization of the applicable product candidates. • Collaboration agreements may not lead to development or commercialization of product candidates in the most efficient manner or at all.
Proceedings to 75 Table of Contents enforce our intellectual property and proprietary rights in foreign jurisdictions could result in substantial costs and divert our efforts and attention from other aspects of our business, could put our patents at risk of being invalidated or interpreted narrowly, could put our patent applications at risk of not issuing, and could provoke third parties to assert claims against us.
Proceedings to enforce our intellectual property and proprietary rights in foreign jurisdictions could result in substantial costs and divert 75 Table of Contents our efforts and attention from other aspects of our business, could put our patents at risk of being invalidated or interpreted narrowly, could put our patent applications at risk of not issuing, and could provoke third parties to assert claims against us.
Disputes may arise regarding intellectual property subject to a licensing agreement, including: • the scope of rights granted under the license agreement and other interpretation-related issues; • the extent to which our technology and processes infringe on intellectual property of the licensor that is not subject to the licensing agreement; 76 Table of Contents • the sublicensing of patent and other rights under our collaborative development relationships; • our diligence obligations under the license agreement and what activities satisfy those diligence obligations; • the inventorship and ownership of inventions and know-how resulting from the joint creation or use of intellectual property by our licensors and us and our partners; and • the priority of invention of patented technology.
Disputes may arise regarding intellectual property subject to a licensing agreement, including: • the scope of rights granted under the license agreement and other interpretation-related issues; • the extent to which our technology and processes infringe on intellectual property of the licensor that is not subject to the licensing agreement; • the sublicensing of patent and other rights under our collaborative development relationships; 76 Table of Contents • our diligence obligations under the license agreement and what activities satisfy those diligence obligations; • the inventorship and ownership of inventions and know-how resulting from the joint creation or use of intellectual property by our licensors and us and our partners; and • the priority of invention of patented technology.
On January 23, 2023, FDA announced that, in matters beyond the scope of that court order, FDA will continue to apply its existing regulations tying orphan-drug exclusivity to the uses or indications for which the orphan drug was approved.
On January 23, 2023, the FDA announced that, in matters beyond the scope of that court order, the FDA will continue to apply its existing regulations tying orphan-drug exclusivity to the uses or indications for which the orphan drug was approved.
Disruptions at the FDA and other agencies may also slow the time necessary for new product candidates to be reviewed and/or approved by necessary government agencies, which would adversely affect our business.
Disruptions at the FDA and other agencies may also slow the time necessary for new product candidates to be reviewed and/or approved by necessary government agencies, which would adversely affect our business.
That regulation was challenged in a lawsuit by the Pharmaceutical Research and Manufacturers of America (“PhRMA”) but the case was dismissed by a federal district court in February 2023 after the court found that PhRMA did not have standing to sue HHS.
That regulation was challenged in a lawsuit by the Pharmaceutical Research and Manufacturers of America (“PhRMA”) but the case was dismissed by a federal district court in February 2023 after the court found that PhRMA did not have standing to sue the HHS.
Further, on November 20, 2020, HHS finalized a regulation removing safe harbor protection for price reductions from pharmaceutical manufacturers to plan sponsors under Part D, either directly or through pharmacy benefit managers, unless the price reduction is required by law.
Further, on November 20, 2020, the HHS finalized a regulation removing safe harbor protection for price reductions from pharmaceutical manufacturers to plan sponsors under Part D, either directly or through pharmacy benefit managers, unless the price reduction is required by law.
The IRA permits the Secretary of HHS to implement many of these provisions through guidance, as opposed to regulation, for the initial years.
The IRA permits the Secretary of the HHS to implement many of these provisions through guidance, as opposed to regulation, for the initial years.
Nonetheless, since CMS may establish a maximum price for these products in price negotiations, we would be fully at risk of government action if our products are the subject of Medicare price negotiations.
Nonetheless, since the CMS may establish a maximum price for these products in price negotiations, we would be fully at risk of government action if our products are the subject of Medicare price negotiations.
On June 6, 2023, Merck & Co. filed a lawsuit against the HHS and CMS asserting that, among other things, the IRA’s Drug Price Negotiation Program for Medicare constitutes an uncompensated taking in violation of the Fifth Amendment of the Constitution. Subsequently, a number of other parties, including the U.S.
On June 6, 2023, Merck & Co. filed a lawsuit against the HHS and the CMS asserting that, among other things, the IRA’s Drug Price Negotiation Program for Medicare constitutes an uncompensated taking in violation of the Fifth Amendment of the Constitution. Subsequently, a number of other parties, including the U.S.
In addition, in some countries, including member states of the EU, the pricing of prescription pharmaceuticals is subject to governmental control. In these countries, pricing negotiations with governmental authorities can take a significant amount of time after receipt of marketing approval for a product.
In addition, in some countries, including EU Member States, the pricing of prescription pharmaceuticals is subject to governmental control. In these countries, pricing negotiations with governmental authorities can take a significant amount of time after receipt of marketing approval for a product.
Restrictions under applicable federal and state healthcare laws and regulations include the following: • the federal healthcare anti-kickback statute prohibits, among other things, persons from knowingly and willfully soliciting, offering, receiving, or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward either the referral of an individual for, or the purchase, order, or recommendation of, any good or service, for which payment may be made under federal and state healthcare programs such as Medicare and Medicaid; • the federal False Claims Act imposes criminal and civil penalties, including civil whistleblower or qui tam actions, against individuals or entities for knowingly presenting, or causing to be presented, to the federal government, claims for payment or approval from Medicare, Medicaid, or other government payors that are false or fraudulent or making a false statement to avoid, decrease, or conceal an obligation to pay money to the federal government, with potential liability including mandatory treble damages and significant per-claim penalties; • the federal Health Insurance Portability and Accountability Act of 1996, as further amended by the Health Information Technology for Economic and Clinical Health Act, which imposes certain requirements, including mandatory contractual terms, with respect to safeguarding the privacy, security, and transmission of individually identifiable health information without appropriate authorization by entities subject to the rule, such as health plans, health care clearinghouses, and health care providers; • the federal false statements statute, which prohibits knowingly and willfully falsifying, concealing, or covering up a material fact or making any materially false statement in connection with the delivery of or payment for healthcare benefits, items, or services; • the federal transparency requirements under the federal Physician Payment Sunshine Act, which requires manufacturers of drugs, devices, biologics, and medical supplies to report to the Department of Health and Human Services information related to payments and other transfers of value to physicians, other healthcare providers and teaching hospitals, and ownership and investment interests held by physicians and their immediate family members and applicable group purchasing organizations; and • analogous state laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers, and certain state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government in addition to requiring drug manufacturers to report information related to payments to physicians and other health care providers or marketing expenditures.
Restrictions under applicable federal and state healthcare laws and regulations include the following: • the federal healthcare anti-kickback statute prohibits, among other things, persons from knowingly and willfully soliciting, offering, receiving, or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward either the referral of an individual for, or the purchase, order, or recommendation of, any good or service, for which payment may be made under federal and state healthcare programs such as Medicare and Medicaid; • the federal False Claims Act imposes criminal and civil penalties, including civil whistleblower or qui tam actions, against individuals or entities for knowingly presenting, or causing to be presented, to the federal government, claims for payment or approval from Medicare, Medicaid, or other government payors that are false or fraudulent or making a false statement to avoid, decrease, or conceal an obligation to pay money to the federal government, with potential liability including mandatory treble damages and significant per-claim penalties; • the federal Health Insurance Portability and Accountability Act of 1996, as further amended by the Health Information Technology for Economic and Clinical Health Act, which imposes certain requirements, including mandatory contractual terms, with respect to safeguarding the privacy, security, and transmission of individually identifiable health information without appropriate authorization by entities subject to the rule, such as health plans, health care clearinghouses, and health care providers; • the federal false statements statute, which prohibits knowingly and willfully falsifying, concealing, or covering up a material fact or making any materially false statement in connection with the delivery of or payment for healthcare benefits, items, or services; • the federal transparency requirements under the federal Physician Payment Sunshine Act, which requires manufacturers of drugs, devices, biologics, and medical supplies to report to the HHS information related to payments and other transfers of value to physicians, other healthcare providers and teaching hospitals, and ownership and investment interests held by physicians and their immediate family members and applicable group purchasing organizations; and • analogous state laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers, and certain state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government in addition to requiring drug manufacturers to report information related to payments to physicians and other health care providers or marketing expenditures.
These provisions include: • limitations on the removal of directors; • a classified board of directors so that not all members of our board of directors are elected at one time; • advance notice requirements for stockholder proposals and nominations; • the inability of stockholders to act by written consent or to call special meetings; • the requirement that at least 75% of the votes cast by all our stockholders approve the amendment or repeal of certain provisions of our amended and restated bylaws or restated certificate of incorporation; • the ability of our board of directors to make, alter, or repeal our amended and restated bylaws; and • the ability of our board of directors to designate the terms of and issue new series of preferred stock without stockholder approval, which could be used to institute a rights plan, or a poison pill, that would work to dilute 98 Table of Contents the stock ownership of a potential hostile acquirer, likely preventing acquisitions that have not been approved by our board of directors.
These provisions include: • limitations on the removal of directors; • a classified board of directors so that not all members of our board of directors are elected at one time; • advance notice requirements for stockholder proposals and nominations; 99 Table of Contents • the inability of stockholders to act by written consent or to call special meetings; • the requirement that at least 75% of the votes cast by all our stockholders approve the amendment or repeal of certain provisions of our amended and restated bylaws or restated certificate of incorporation; • the ability of our board of directors to make, alter, or repeal our amended and restated bylaws; and • the ability of our board of directors to designate the terms of and issue new series of preferred stock without stockholder approval, which could be used to institute a rights plan, or a poison pill, that would work to dilute the stock ownership of a potential hostile acquirer, likely preventing acquisitions that have not been approved by our board of directors.
Further, our product candidates are composed of multiple components and require specialized formulations for which scale-up and manufacturing could be difficult. We have limited experience in such scale-up and manufacturing requiring us to depend on a limited number of third parties, who may not be able to deliver in a timely manner, or at all.
Further, our product candidates may be composed of multiple components and require specialized formulations for which scale-up and manufacturing could be difficult. We have limited experience in such scale-up and manufacturing requiring us to depend on a limited number of third parties, who may not be able to deliver in a timely manner, or at all.
Our relatively short history as an operating company makes any assessment of our future success or viability subject to significant uncertainty. We will encounter risks and difficulties frequently experienced by early-stage companies in rapidly evolving fields. If we do not address these risks successfully, our business will suffer.
Our relatively short history as an operating company makes any assessment of our future success or viability subject to significant uncertainty. We will encounter risks and difficulties frequently experienced by other early-stage companies in rapidly evolving fields. If we do not address these risks successfully, our business will suffer.
Any public health crises or related healthcare staffing shortages, supply chain restrictions, or other issues, may result in disruptions that could adversely impact our operations, research and development, including preclinical studies, clinical trials and manufacturing activities, including: • delays or disruptions in clinical trials that we may be conducting, including patient screening, patient enrollment, patient dosing, clinical trial site activation, and study monitoring; • delays or disruptions in preclinical experiments and IND- and clinical trial application-enabling studies due to restrictions related to our staff being on site; • interruption or delays in the operations of the FDA, EMA and comparable foreign regulatory agencies; • interruption of, or delays in, receiving, supplies of drug substance and drug product from our CMOs or delays or disruptions in our pre-clinical experiments or clinical trials performed by CROs due to staffing shortages, production and research slowdowns or stoppages and disruptions in delivery systems or research; 94 Table of Contents • limitations imposed on our business operations by local, state, or federal authorities to address such pandemics or similar public health crises could impact our ability to conduct preclinical or clinical activities, including conducting IND- and clinical trial application-enabling studies or our ability to select future development candidates; and • business disruptions caused by potential workplace, laboratory and office closures and an increased reliance on employees working from home, disruptions to or delays in ongoing laboratory experiments and operations, staffing shortages, travel limitations, cyber security and data accessibility, or communication or mass transit disruptions, any of which could adversely impact our business operations or delay necessary interactions with local regulators, ethics committees, manufacturing sites, research or clinical trial sites and other important agencies and contractors.
Any public health crises or related healthcare staffing shortages, supply chain restrictions, or other issues, may result in disruptions that could adversely impact our operations, research and development, including preclinical studies, clinical trials and manufacturing activities, including: • delays or disruptions in clinical trials that we may be conducting, including patient screening, patient enrollment, patient dosing, clinical trial site activation, and study monitoring; • delays or disruptions in preclinical experiments and IND- and clinical trial application-enabling studies due to restrictions related to our staff being on site; • interruption or delays in the operations of the FDA, EMA and comparable foreign regulatory agencies; • interruption of, or delays in, receiving, supplies of drug substance and drug product from our CMOs or delays or disruptions in our pre-clinical experiments or clinical trials performed by CROs due to staffing shortages, production and research slowdowns or stoppages and disruptions in delivery systems or research; • limitations imposed on our business operations by local, state, or federal authorities to address such pandemics or similar public health crises could impact our ability to conduct preclinical or clinical activities, including conducting IND- and clinical trial application-enabling studies or our ability to select future development candidates; and • business disruptions caused by potential workplace, laboratory and office closures and an increased reliance on employees working from home, disruptions to or delays in ongoing laboratory experiments and operations, staffing shortages, travel limitations, cyber security and data accessibility, or communication or mass transit disruptions, any of which could adversely impact our business operations or delay necessary interactions with local regulators, ethics committees, manufacturing sites, research or clinical trial sites and other important agencies and contractors.
The request for ex parte re-examination was granted on May 9, 2016 thereby initiating a re-examination procedure between the USPTO and The Broad Institute, acting on behalf of itself and MIT. The PTAB has suspended the re-examination noting that it has jurisdiction over any file that involves a patent involved in an interference.
The request for ex parte re-examination was granted on May 9, 2016 thereby initiating a re-examination procedure between the USPTO and Broad, acting on behalf of itself and MIT. The PTAB has suspended the re-examination noting that it has jurisdiction over any file that involves a patent involved in an interference.
Mergers and acquisitions in the pharmaceutical, biotechnology, and gene therapy industries may result in even more resources being concentrated among a smaller number of our competitors. Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.
Mergers and acquisitions in the pharmaceutical, biotechnology, and gene therapy industries may result in even more resources being concentrated among a smaller number of our competitors. Smaller or other early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.
The degree of market acceptance of any of our product candidates, if approved for commercial sale, will depend on a number of factors, including: • the efficacy and safety of such product candidates as demonstrated in clinical trials; • the potential and perceived advantages compared to alternative treatments; • the limitation to our targeted patient population and limitations or warnings contained in approved labeling by the FDA or other regulatory authorities; • the ability to offer our medicines for sale at competitive prices; • convenience and ease of administration compared to alternative treatments; • the clinical indications for which the product candidate is approved by the FDA, the European Commission, or other regulatory agencies; • public attitudes regarding genomic medicine generally and genome editing technologies specifically; • the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies, as well as their willingness to accept a therapeutic intervention that involves the editing of the patient’s genome; • product labeling or product insert requirements of the FDA, the EMA, or other regulatory authorities, including any limitations or warnings contained in a product’s approved labeling; • relative convenience and ease of administration; • the timing of market introduction of competitive products; • publicity concerning our products or competing products and treatments; • the strength of marketing and distribution support; • sufficient third-party coverage or reimbursement; and • the prevalence and severity of any side effects.
The degree of market acceptance of any of our product candidates, if approved for commercial sale, will depend on a number of factors, including: • the efficacy and safety of such product candidates as demonstrated in clinical trials; • the potential and perceived advantages compared to alternative treatments; 61 Table of Contents • the limitation to our targeted patient population and limitations or warnings contained in approved labeling by the FDA or other regulatory authorities; • the ability to offer our medicines for sale at competitive prices; • convenience and ease of administration compared to alternative treatments; • the clinical indications for which the product candidate is approved by the FDA, the European Commission, or other regulatory agencies; • public attitudes regarding genomic medicine generally and genome editing technologies specifically; • the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies, as well as their willingness to accept a therapeutic intervention that involves the editing of the patient’s genome; • product labeling or product insert requirements of the FDA, the EMA, or other regulatory authorities, including any limitations or warnings contained in a product’s approved labeling; • relative convenience and ease of administration; • the timing of market introduction of competitive products; • publicity concerning our products or competing products and treatments; • the strength of marketing and distribution support; • sufficient third-party coverage or reimbursement; and • the prevalence and severity of any side effects.
For example, the Inflation Reduction Act of 2022 (the “IRA”) includes several measures intended to lower the cost of prescription drugs and related healthcare reforms, including limits on price increases and subjecting an escalating number of drugs to annual price negotiations with The Centers for Medicare & Medicaid Services.
For example, the Inflation Reduction Act of 2022 (the “IRA”) includes several measures intended to lower the cost of prescription drugs and related healthcare reforms, including limits on price increases and subjecting an escalating number of drugs to annual price negotiations with The Centers for Medicare & Medicaid Services (“CMS”).
It is uncertain when the PTAB will lift the suspension. If The Broad Institute is unsuccessful during the re-examination, the patent in question may be revoked or narrowed, which could have a material adverse effect on the scope of our rights under such patent.
It is uncertain when the PTAB will lift the suspension. If Broad is unsuccessful during the re-examination, the patent in question may be revoked or narrowed, which could have a material adverse effect on the scope of our rights under such patent.
If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we may have obtained and we may not achieve or sustain profitability. 86 Table of Contents Our relationships with healthcare providers, physicians, and third-party payors will be subject to applicable anti-kickback, fraud and abuse, and other healthcare laws and regulations, which could expose us to criminal sanctions, civil penalties, contractual damages, reputational harm, and diminished profits and future earnings.
If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we may have obtained and we may not achieve or sustain profitability. 87 Table of Contents Our relationships with healthcare providers, physicians, and third-party payors will be subject to applicable anti-kickback, fraud and abuse, and other healthcare laws and regulations, which could expose us to criminal sanctions, civil penalties, contractual damages, reputational harm, and diminished profits and future earnings.
If reimbursement of our products is unavailable or limited in scope or amount, or if pricing is set at unsatisfactory levels, the commercial launch of our product and/or product candidates could be delayed, possibly for lengthy periods of time, we or our collaborators may not launch at all in a particular country, we may not be able to recoup our investment in one or more product candidates, and there could be a material adverse effect on our business. 90 Table of Contents Our employees, principal investigators, consultants, and commercial partners may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and insider trading.
If reimbursement of our products is unavailable or limited in scope or amount, or if pricing is set at unsatisfactory levels, the commercial launch of our product and/or product candidates could be delayed, possibly for lengthy periods of time, we or our collaborators may not launch at all in a particular country, we may not be able to recoup our investment in one or more product candidates, and there could be a material adverse effect on our business. 91 Table of Contents Our employees, principal investigators, consultants, and commercial partners may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and insider trading.
In the European Union, the development and evaluation of a genetic medicinal product must be considered in the context of the relevant European Union guidelines. The EMA may issue new guidelines concerning the development and marketing authorization for genetic medicinal products and require that we comply with these new guidelines.
In the EU, the development and evaluation of a genetic medicinal product must be considered in the context of the relevant European Union guidelines. The EMA may issue new guidelines concerning the development and marketing authorization for genetic medicinal products and require that we comply with these new guidelines.
We expect to rely on third parties to conduct our clinical trials and some aspects of our research and preclinical testing, and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such trials, research, or testing.
We expect to rely on third parties to conduct our future clinical trials and some aspects of our research and preclinical testing, and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such trials, research, or testing.
CMS may negotiate prices for ten high-cost drugs paid for by Medicare Part D starting in 2026, followed by 15 Part D drugs in 2027, 15 Part B or Part D drugs in 2028, and 20 Part B or Part D drugs in 2029 and beyond.
The CMS may negotiate prices for ten high-cost drugs paid for by Medicare Part D starting in 2026, followed by 15 Part D drugs in 2027, 15 Part B or Part D drugs in 2028, and 20 Part B or Part D drugs in 2029 and beyond.
These regulatory review committees and advisory groups and the new guidances they promulgate may lengthen the regulatory review process, require us to perform additional studies, increase our development costs, lead to changes in regulatory positions and interpretations, delay or prevent approval and commercialization of any product candidates we may develop or lead to significant post-approval limitations or restrictions.
These regulatory review committees and advisory groups and the new guidance they promulgate may lengthen the regulatory review process, require us to perform additional studies, increase our development costs, lead to changes in regulatory positions and interpretations, delay or prevent approval and commercialization of any product candidates we may develop or lead to significant post-approval limitations or restrictions.
Nonetheless, the FDA’s regulatory requirements governing genetic and cellular medicines continue to evolve and we will need to monitor and adapt to these requirements as they develop. The same is true for activities in the European Union. The EMA’s Committee for Advanced Therapies (“CAT”) is responsible for assessing the quality, safety and efficacy of advanced-therapy medicinal products.
The FDA’s regulatory requirements governing genetic and cellular medicines continue to evolve and we will need to monitor and adapt to these requirements as they develop. The same is true for activities in the European Union (the “EU”). The EMA’s Committee for Advanced Therapies (“CAT”) is responsible for assessing the quality, safety and efficacy of advanced-therapy medicinal products.
Some of the factors that may cause the market price of our common stock to fluctuate include: • the success of existing or new competitive products or technologies; • the timing and results of our RUBY and EdiTHAL clinical trials for reni-cel and any preclinical studies and clinical trials of any other product candidates that we develop; • commencement or termination of collaborations for our product development and research programs; • failure or discontinuation of any of our product development and research programs; • results of preclinical studies, clinical trials, or regulatory approvals of product candidates of our competitors, or announcements about new research programs or product candidates of our competitors; • developments or changing views regarding the use of genomic medicines, including those that involve genome editing; • regulatory or legal developments in the United States and other countries; • developments or disputes concerning patent applications, issued patents, or other proprietary rights; • the recruitment or departure of key personnel; • the level of expenses related to any of our research programs, clinical development programs, or product candidates that we develop; • the results of our efforts to develop additional product candidates or products; • actual or anticipated changes in estimates as to financial results, development timelines, or recommendations by securities analysts; • announcement or expectation of additional financing efforts; • sales of our common stock by us, our insiders, or other stockholders; • variations in our financial results or those of companies that are perceived to be similar to us; • changes in estimates or recommendations by securities analysts, if any, that cover our stock; 96 Table of Contents • changes in the structure of healthcare payment systems; • market conditions in the pharmaceutical and biotechnology sectors; • general economic, industry, and market conditions; and • the other factors described in this “Risk Factors” section.
Some of the factors that may cause the market price of our common stock to fluctuate include: • the success of existing or new competitive products or technologies; • the timing and results of our preclinical studies for any product candidates that we develop; • commencement or termination of collaborations for our product development and research programs; • failure or discontinuation of any of our product development and research programs; • results of preclinical studies, clinical trials, or regulatory approvals of product candidates of our competitors, or announcements about new research programs or product candidates of our competitors; • developments or changing views regarding the use of genomic medicines, including those that involve genome editing; • regulatory or legal developments in the United States and other countries; • developments or disputes concerning patent applications, issued patents, or other proprietary rights; • the recruitment or departure of key personnel; 97 Table of Contents • the level of expenses related to any of our research programs, clinical development programs, or product candidates that we develop; • the results of our efforts to develop additional product candidates or products; • actual or anticipated changes in estimates as to financial results, development timelines, or recommendations by securities analysts; • announcement or expectation of additional financing efforts; • sales of our common stock by us, our insiders, or other stockholders; • variations in our financial results or those of companies that are perceived to be similar to us; • changes in estimates or recommendations by securities analysts, if any, that cover our stock; • changes in the structure of healthcare payment systems; • market conditions in the pharmaceutical and biotechnology sectors; • general economic, industry, and market conditions; and • the other factors described in this “Risk Factors” section.
Even if the endpoints are deemed clinically meaningful, we may not achieve these endpoints to a degree of statistical significance, particularly because many of the diseases we are 54 Table of Contents targeting with our platform have small patient populations, making development of large and rigorous clinical trials more difficult.
Even if the endpoints are deemed clinically meaningful, we may not achieve these endpoints to a degree of statistical significance, particularly because many of the diseases we are 53 Table of Contents targeting with our platform have small patient populations, making development of large and rigorous clinical trials more difficult.
Misconduct by these parties could include intentional failures to comply with FDA regulations or the regulations applicable in the European Union and other jurisdictions, provide accurate information to the FDA, the European Commission, and other regulatory authorities, comply with healthcare fraud and abuse laws and regulations in the United States and abroad, report financial information or data accurately, or disclose unauthorized activities to us.
Misconduct by these parties could include intentional failures to comply with FDA regulations or the regulations applicable in the EU and other jurisdictions, provide accurate information to the FDA, the European Commission, and other regulatory authorities, comply with healthcare fraud and abuse laws and regulations in the United States and abroad, report financial information or data accurately, or disclose unauthorized activities to us.
These changes included aggregate reductions to Medicare payments to providers of up to 2% per fiscal year, which went into effect in April 2013 and will remain in effect through 2031 under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). Under current legislation, the actual reductions in Medicare payments may vary up to 4%.
These changes included aggregate reductions to Medicare payments to providers of up to 2% per fiscal year, which went into effect in April 2013 and will remain in effect through 2031 under the Coronavirus Aid, Relief, and Economic Security Act. Under current legislation, the actual reductions in Medicare payments may vary up to 4%.
Prohibitions are also in place in the United Kingdom, across most of Europe, in China, and many other countries around the world.
Prohibitions are also in place in the United Kingdom (the “UK”), across most of Europe, in China, and many other countries around the world.
It is difficult for us to predict the time and cost of product candidate development, and we cannot predict whether the application of our genome editing platform, or any similar or 53 Table of Contents competitive genome editing platforms, will result in the identification, development, and regulatory approval of any medicines.
It is difficult for us to predict the time and cost of product candidate development, and we cannot predict whether the application of our genome editing platform, or any similar or competitive 52 Table of Contents genome editing platforms, will result in the identification, development, and regulatory approval of any medicines.
Our research methodology may be unsuccessful in identifying potential product candidates, or our potential product candidates may be shown to have smaller patient populations than initially estimated or may have harmful side effects or may have other characteristics that may make the products impractical to manufacture or commercialize, or unlikely to receive marketing approval.
Our research methodology may be unsuccessful in identifying potential product candidates, or our potential product candidates may be shown to have smaller patient populations than initially estimated or may have harmful side effects or may have other characteristics or unforeseeable consequences that may make the products impractical to manufacture or commercialize, or unlikely to receive marketing approval.
In addition, if a 95 Table of Contents ransomware attack or other cybersecurity incident occurs, either internally or at our vendors or third-party technology service providers, we could be prevented from accessing our data or systems, which may cause interruptions or delays in our business operations, cause us to incur remediation costs, subject us to demands to pay a ransom, or damage our reputation, regardless of whether we pay the ransom amount.
In addition, if a ransomware attack or other cybersecurity incident occurs, either internally or at our vendors or third-party technology service providers, we could be prevented from accessing our data or systems, which may cause interruptions or delays in our business operations, cause us to incur remediation costs, subject us to demands to pay a ransom, or damage our reputation, regardless of whether we pay the ransom amount.
Further, we could face heightened risks with respect to obtaining marketing authorization in the UK as a result of the withdrawal of the UK from the EU, commonly referred to as Brexit. The UK is no longer part of the European Single Market and EU Customs Union.
Additionally, we could face heightened risks with respect to obtaining marketing authorization in the UK as a result of the withdrawal of the UK from the EU, commonly referred to as Brexit. The UK is no longer part of the European Single Market and EU Customs Union.
Regardless of merit or eventual outcome, liability claims may result in: • decreased demand for any product candidates or medicines that we may develop; • injury to our reputation and significant negative media attention; • withdrawal of clinical trial participants; • significant time and costs to defend the related litigation; • substantial monetary awards to trial participants or patients; • loss of revenue; and 66 Table of Contents • the inability to commercialize any medicines that we may develop.
Regardless of merit or eventual outcome, liability claims may result in: • decreased demand for any product candidates or medicines that we may develop; • injury to our reputation and significant negative media attention; • withdrawal of clinical trial participants; • significant time and costs to defend the related litigation; • substantial monetary awards to trial participants or patients; • loss of revenue; and • the inability to commercialize any medicines that we may develop.
Any regulatory approvals that we may receive for our product candidates will require the submission of reports to regulatory authorities and ongoing surveillance to monitor the safety and efficacy of the product candidate, may contain significant limitations related to use restrictions for specified age groups, warnings, precautions or contraindications, and may include burdensome post-approval study or risk management requirements and regulatory inspection.
Any regulatory approvals that we may receive for our product candidates will require the submission of reports to regulatory authorities and ongoing surveillance to monitor the safety and efficacy of the product candidate, may contain 85 Table of Contents significant limitations related to use restrictions for specified age groups, warnings, precautions or contraindications, and may include burdensome post-approval study or risk management requirements and regulatory inspection.
Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare (beginning in 2026), 89 Table of Contents with prices that can be negotiated subject to a cap; imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2025); and replaces the Part D coverage gap discount program with a new discounting program (beginning in 2025).
Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare (beginning in 2026), with prices that can be negotiated subject to a cap; imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2025); and replaces the Part D coverage gap discount program with a new discounting program (beginning in 2025).
In addition to California, at least eleven other states have passed comprehensive privacy laws similar to the CCPA and CPRA. These laws are either in effect or will go into effect sometime before the end of 2026.
In addition to California, at least eighteen other states have passed comprehensive privacy laws similar to the CCPA and CPRA. These laws are either in effect or will go into effect sometime before the end of 2026.
In the United States, the NIH has announced that it would not fund any use of genome editing technologies in human embryos, noting that there are multiple existing legislative and regulatory prohibitions against such work, including the Dickey-Wicker Amendment, which prohibits the use of appropriated funds for the creation of human embryos for research purposes or for research in which human embryos are destroyed.
In the United States, the NIH has announced that it would not fund any use of genome editing technologies in human embryos, noting that there are multiple 62 Table of Contents existing legislative and regulatory prohibitions against such work, including the Dickey-Wicker Amendment, which prohibits the use of appropriated funds for the creation of human embryos for research purposes or for research in which human embryos are destroyed.
If any of these additional shares are sold, or if it is perceived that they will be sold, in the public market, the market price of our common stock could decline. We incur costs as a result of operating as a public company, and our management is required to devote substantial time to compliance initiatives and corporate governance practices.
If any of these additional shares are sold, or if it is perceived that they will be sold, in the public market, the market price of our common stock could decline. 98 Table of Contents We incur costs as a result of operating as a public company, and our management is required to devote substantial time to compliance initiatives and corporate governance practices.
Collaborations are also complex and time-consuming to negotiate and document. In addition, there have been a significant number of recent business combinations among large pharmaceutical companies that have resulted in a reduced number of potential future collaborators. 69 Table of Contents We may not be able to negotiate collaborations on a timely basis, on acceptable terms, or at all.
Collaborations are also complex and time-consuming to negotiate and document. In addition, there have been a significant number of recent business combinations among large pharmaceutical companies that have resulted in a reduced number of potential future collaborators. We may not be able to negotiate collaborations on a timely basis, on acceptable terms, or at all.
PRIME enables an applicant to request parallel EMA scientific advice and health technology assessment advice to facilitate timely market access. Even if we receive PRIME designation for any of our product candidates, the designation may not result in a materially faster development process, review or approval compared to conventional EMA procedures.
PRIME enables an applicant to request parallel EMA scientific advice and health technology assessment advice to facilitate timely market access. Even if we receive PRIME designation for any of our product 81 Table of Contents candidates, the designation may not result in a materially faster development process, review or approval compared to conventional EMA procedures.
We also may encounter problems hiring and retaining the experienced scientific, quality control, and manufacturing personnel needed to manage our manufacturing process, which could result in delays in our production or difficulties in maintaining compliance with applicable regulatory requirements. Given the nature of biologics manufacturing, there is a risk of contamination during manufacturing.
We also may encounter problems hiring and retaining the experienced scientific, quality control, and manufacturing personnel needed to manage our manufacturing process, which could result in delays in our production or difficulties in maintaining compliance with applicable regulatory requirements. 67 Table of Contents Given the nature of biologics manufacturing, there is a risk of contamination during manufacturing.
The availability of our competitors’ products could limit the demand, and the price we are able to charge, for any products that we may develop and commercialize. If we are able to commercialize any product candidates, such products may become subject to unfavorable pricing regulations, third-party reimbursement practices, or healthcare reform initiatives, which would harm our business.
The availability of our competitors’ products could limit the demand, and the price we are able to charge, for any products that we may develop and commercialize. 64 Table of Contents If we are able to commercialize any product candidates, such products may become subject to unfavorable pricing regulations, third-party reimbursement practices, or healthcare reform initiatives, which would harm our business.
If we are unable to do so, we may have to curtail the development of the product candidate for which we are seeking to collaborate, reduce or delay its development program or one or more of our other development programs, delay its potential commercialization or reduce the scope of any sales or marketing activities, or increase our expenditures and undertake development or commercialization activities at our own expense.
If we are unable to do so, we may have to curtail the development of the product candidate for which we are seeking to collaborate, reduce or 69 Table of Contents delay its development program or one or more of our other development programs, delay its potential commercialization or reduce the scope of any sales or marketing activities, or increase our expenditures and undertake development or commercialization activities at our own expense.
Our future capital requirements will depend on many factors, including: • the costs of progressing the clinical development of reni-cel to treat SCD and TDT; • the scope, progress, results, and costs of clinical trials, drug discovery, preclinical development, laboratory testing, and clinical or natural history study trials for other product candidates we develop; • the costs of preparing, filing, and prosecuting patent applications, maintaining and enforcing our intellectual property and proprietary rights, and defending intellectual property-related claims; • the costs, timing, and outcome of regulatory review of the product candidates we develop; • the costs of establishing and maintaining a supply chain for the development and manufacture of our product candidates; • the costs of future activities, including product sales, medical affairs, marketing, manufacturing, and distribution, for any product candidates for which we receive regulatory approval; • the success of our collaboration with BMS, including whether BMS exercises any of its options to extend the research program term and/or to additional research programs under our collaboration; • our ability to establish and maintain additional collaborations on favorable terms, if at all; • the extent to which we acquire or in-license other medicines and technologies; • the costs of reimbursing our licensors for the prosecution and maintenance of the patent rights in-licensed by us; and • our ability to establish and maintain healthcare coverage and adequate reimbursement for any product candidates for which we receive regulatory approval.
Our future capital requirements will depend on many factors, including: • the restructuring costs associated with the discontinuation of clinical development of reni-cel; • the scope, progress, results, and costs of drug discovery, preclinical development, laboratory testing, and clinical or natural history study trials for the product candidates we may develop; • the costs of preparing, filing, and prosecuting patent applications, maintaining and enforcing our intellectual property and proprietary rights, and defending intellectual property-related claims; • the costs, timing, and outcome of regulatory review of the product candidates we may develop; • the costs of establishing and maintaining a supply chain for the development and manufacture of our product candidates; • the costs of future activities, including product sales, medical affairs, marketing, manufacturing, and distribution, for any product candidates for which we receive regulatory approval; • the success of our collaboration with BMS, including whether BMS exercises any of its options to extend the research program term and/or to additional research programs under our collaboration; • our ability to establish and maintain additional collaborations on favorable terms, if at all; • the extent to which we acquire or in-license other medicines and technologies; • the costs of reimbursing our licensors for the prosecution and maintenance of the patent rights in-licensed by us; and • our ability to establish and maintain healthcare coverage and adequate reimbursement for any product candidates for which we receive regulatory approval.
If we are unable to demonstrate that such adverse events were caused by factors other than our product candidate, the FDA, the EMA or other regulatory authorities could order us to cease further development of, or deny approval of, any product candidates we are able to develop for any or all targeted indications.
If we are unable to demonstrate that such adverse events were caused by factors other than our product candidate, the FDA, the EMA or other regulatory authorities could order us to cease further development of, or deny approval of, any product candidates we are able to 56 Table of Contents develop for any or all targeted indications.
Many of the CCPA’s requirements are similar to those found in the General Data Protection Regulation (the “GDPR”), including requiring businesses to provide notice to data subjects regarding the information collected about them and how such information is used and shared, and providing data subjects the right to request access to such personal information and, in certain cases, request the erasure of such personal information.
Many of the CCPA’s requirements are similar to those found in the General Data Protection Regulation (the “GDPR”), including requiring businesses to provide notice to data subjects regarding the information collected about them and how such 93 Table of Contents information is used and shared, and providing data subjects the right to request access to such personal information and, in certain cases, request the erasure of such personal information.
In order to market and sell any of our product candidates in the European Union and many other foreign jurisdictions, we or our collaborators must obtain separate marketing approvals and comply with numerous and varying regulatory requirements. The approval procedure varies among countries and can involve additional testing.
In order to market and sell any of our product candidates in the EU and many other foreign jurisdictions, we or our collaborators must obtain separate marketing approvals and comply with numerous and varying regulatory requirements. The approval procedure varies among countries and can involve additional testing.
We also rely to a large extent on information technology systems to operate our business, including our financial systems. We have outsourced elements of our confidential information processing and information technology structure, and as a result, we are managing independent vendor relationships with third parties who may or could have access to our confidential information.
We also rely to a large extent on information technology systems to operate our business, including our financial systems. We have outsourced elements of our confidential information processing and information technology structure, and as a result, we 96 Table of Contents are managing independent vendor relationships with third parties who may or could have access to our confidential information.
The manner and level at which 65 Table of Contents reimbursement is provided for services related to any of our product candidates, e.g., for administration of our product to patients, is also important. Inadequate reimbursement for such services may lead to physician resistance and adversely affect our ability to market or sell our products.
The manner and level at which reimbursement is provided for services related to any of our product candidates, e.g., for administration of our product to patients, is also important. Inadequate reimbursement for such services may lead to physician resistance and adversely affect our ability to market or sell our products.
In particular, the concept of what constitutes the "same drug" for purposes of orphan drug exclusivity remains in flux in the context of gene therapies. In September 2021, the FDA issued final guidance describing its current thinking on when a gene therapy product is the “same” as another product for purposes of orphan exclusivity.
In particular, the concept of what constitutes the "same drug" for purposes of orphan drug exclusivity remains in flux in the context of gene therapies. 82 Table of Contents In September 2021, the FDA issued final guidance describing its current thinking on when a gene therapy product is the “same” as another product for purposes of orphan exclusivity.
The collection, use, disclosure, transfer, or other processing of personal data, including personal health data, regarding individuals who are located in the European Economic Area (“EEA”), and the processing of personal data that takes place in the EEA, is regulated by the GDPR, which went into effect in May 2018 and which imposes obligations on companies that operate in our industry with respect to the processing of personal data and the cross-border transfer of such data.
The collection, use, disclosure, transfer, or other processing of personal data, including personal health data, regarding individuals who are located in the EEA, and the processing of personal data that takes place in the EEA, is regulated by the GDPR, which went into effect in May 2018 and which imposes obligations on companies that operate in our industry with respect to the processing of personal data and the cross-border transfer of such data.
Laws in the United Kingdom prohibit genetically modified embryos from being implanted into women, but embryos can be altered in research labs under license from the Human Fertilisation and Embryology Authority. Basic research on embryos is more tightly controlled in many other European countries.
Laws in the UK prohibit genetically modified embryos from being implanted into women, but embryos can be altered in research labs under license from the Human Fertilisation and Embryology Authority. Basic research on embryos is more tightly controlled in many other European countries.
The applicable period is seven years in the United States and ten years in the European Union. The exclusivity period in the European Union can be reduced to six years if a product no longer meets the criteria for orphan drug designation, in particular if the product is sufficiently profitable so that market exclusivity is no longer justified.
The applicable period is seven years in the United States and ten years in the EU. The exclusivity period in the EU can be reduced to six years if a product no longer meets the criteria for orphan drug designation, in particular if the product is sufficiently profitable so that market exclusivity is no longer justified.
We are subject to and may in the future become party to, or threatened with, adversarial proceedings or litigation regarding intellectual property rights with respect to our technology and any product candidates we develop, including interference, re-examination, post-grant review, inter partes review, and derivation proceedings before the USPTO and similar proceedings in foreign jurisdictions such as oppositions before the EPO.
We are subject to and may in the future become party to, or threatened with, adversarial proceedings or litigation regarding intellectual property rights with respect to our technology and any product candidates we develop, including interference, re-examination, post-grant review, inter partes review, and derivation proceedings before the USPTO and similar proceedings in foreign jurisdictions such as oppositions before the European Patent Organisation.
The 91 Table of Contents SEC also may suspend or bar issuers from trading securities on U.S. exchanges for violations of the FCPA’s accounting provisions.
The 92 Table of Contents SEC also may suspend or bar issuers from trading securities on U.S. exchanges for violations of the FCPA’s accounting provisions.
Public attitudes may be influenced by claims that genome editing is unsafe, unethical, or immoral, and, consequently, our products may not gain the acceptance of the public or the medical community. Adverse public attitudes may adversely impact our ability to enroll clinical trials.
Public attitudes may be influenced by claims that genome editing is unsafe, unethical, or immoral, and, consequently, our products may not gain the acceptance of the public or the medical community. Adverse public attitudes may adversely impact our ability to enroll eligible patients in clinical trials.
If we do not accurately evaluate the commercial potential or target market for a particular product candidate, we may relinquish valuable rights to that product candidate through collaboration, licensing, or other royalty arrangements in cases in which it would have been more advantageous for us to retain sole development and commercialization rights to such product candidate.
If we do not accurately evaluate the commercial potential or target market for a particular product candidate, we may relinquish valuable rights to that product candidate through collaboration, licensing, or other royalty arrangements in cases in which it would have been more advantageous for us to 60 Table of Contents retain sole development and commercialization rights to such product candidate.
The program focuses on medicines that target conditions for which there exists no satisfactory method of treatment in the EU or even if such a method exists, it may offer a major therapeutic advantage over 81 Table of Contents existing treatments.
The program focuses on medicines that target conditions for which there exists no satisfactory method of treatment in the EU or even if such a method exists, it may offer a major therapeutic advantage over existing treatments.
Under the Orphan Drug Act, the FDA may designate a product as an orphan drug if it is a drug or biologic intended to treat a rare disease or condition. A similar regulatory scheme governs approval of orphan products by the EMA in the European Union.
Under the Orphan Drug Act, the FDA may designate a product as an orphan drug if it is a drug or biologic intended to treat a rare disease or condition. A similar regulatory scheme governs approval of orphan products by the EMA in the EU.
Problems in third-party manufacturing process or facilities also could restrict our ability to ensure sufficient clinical material for any clinical trials we may be conducting or are planning to conduct and meet market demand for any products we commercialize.
Problems in third-party manufacturing process or facilities also could restrict our ability to ensure sufficient clinical material for any clinical trials we are planning to conduct and meet market demand for any products we commercialize.
Under the new coordinated procedure for the approval of clinical trials, the sponsor of a clinical trial to be conducted in more than one Member State of the EU (“EU Member State”) will only be required to submit a single application for approval.
Under the new coordinated procedure for the approval of clinical trials, the sponsor of a clinical trial to be conducted in more than one Member State of the EU (“EU Member 80 Table of Contents State”) will only be required to submit a single application for approval.
We also experience competition for the hiring of scientific and clinical personnel from universities and research institutions. In addition, we rely on consultants and advisors, including scientific and clinical advisors, to assist us in formulating our research and development and commercialization strategy.
We also experience competition for the hiring of scientific and clinical personnel from universities and research institutions. In addition, we 95 Table of Contents rely on consultants and advisors, including scientific and clinical advisors, to assist us in formulating our research and development and commercialization strategy.
We have concentrated our research and development efforts on our genome editing platform, which uses CRISPR technology. Our future success depends on the successful development of this relatively novel genome editing therapeutic approach. In 2023, the first and, to date, only, approved therapeutic product that utilizes genome editing, including CRISPR technology, was approved in the United States and Europe.
We have concentrated our research and development efforts on our genome editing platform, which uses CRISPR technology. Our future success depends on the successful development of this relatively novel genome editing therapeutic approach. In 2023, the first and, to date, only, approved therapeutic product that utilizes ex vivo CRISPR-based genome editing was approved in the United States and Europe.
For hemoglobinopathies, these companies include Acceleron Pharma, Agios Pharmaceuticals, Global Blood Therapeutics, Novartis Pharmaceuticals, and Vertex. Many of our competitors may have significantly greater financial resources and expertise in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approvals, and marketing approved products than we do.
For hemoglobinopathies, these companies include Acceleron Pharma, Agios Pharmaceuticals, Novartis Pharmaceuticals, Pfizer, and Vertex. Many of our competitors may have significantly greater financial resources and expertise in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approvals, and marketing approved products than we do.
We intend to identify and develop product candidates based on a relatively novel genome editing technology, which makes it difficult to predict the time and cost of product candidate development. Only one therapeutic product that utilizes genome editing technology has been approved in the United States or in Europe.
Risks Related to Discovery, Development, and Commercialization We intend to identify and develop product candidates based on a relatively novel genome editing technology, which makes it difficult to predict the time and cost of product candidate development. Only one therapeutic product that utilizes genome editing technology has been approved in the United States or in Europe.
These requirements include submissions of safety and other 85 Table of Contents post-marketing information and reports, registration, as well as ongoing compliance with cGMPs and good clinical practices (GCP) for any clinical trials that we conduct post-approval.
These requirements include submissions of safety and other post-marketing information and reports, registration, as well as ongoing compliance with cGMPs and good clinical practices (GCP) for any clinical trials that we conduct post-approval.
Even if the FDA does find our success criteria to be sufficiently validated and clinically meaningful, we may not achieve the pre-specified endpoints to a degree of statistical significance.
Even if the FDA does find our 57 Table of Contents success criteria to be sufficiently validated and clinically meaningful, we may not achieve the pre-specified endpoints to a degree of statistical significance.
We may also need to raise additional funds sooner if we choose to pursue additional indications or geographies for our product candidates or 50 Table of Contents otherwise expand more rapidly than we presently anticipate. Accordingly, we will need to obtain substantial additional funding in connection with our continuing operations.
We may also need to raise additional funds sooner if we choose to pursue additional indications or geographies for our product candidates or otherwise expand more rapidly than we presently anticipate. Accordingly, we will need to obtain substantial additional funding in connection with our continuing operations.
Debt financing, if available, would result in increased fixed payment obligations and may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, or declaring dividends.
Debt financing, if available, would result in increased fixed payment obligations and 51 Table of Contents may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, or declaring dividends.
The FDA may conclude that the condition or disease for which we seek orphan drug exclusivity does not meet this standard. Even if we obtain orphan drug exclusivity for a product, that exclusivity may not effectively protect 82 Table of Contents the product from competition because different products can be approved for the same condition.
The FDA may conclude that the condition or disease for which we seek orphan drug exclusivity does not meet this standard. Even if we obtain orphan drug exclusivity for a product, that exclusivity may not effectively protect the product from competition because different products can be approved for the same condition.
Following the withdrawal of the U.K. from the EU, the U.K. Data Protection Act 2018 applies to the processing of personal data that takes place in the U.K. and includes parallel obligations to those set forth by GDPR.
Following the withdrawal of the UK from the EU, the UK Data Protection Act 2018 applies to the processing of personal data that takes place in the UK and includes parallel obligations to those set forth by GDPR.
For example, under our amended and restated collaboration with BMS, we may not use directly or indirectly, or license others to use, genome editing technology in connection with any research, development, manufacture, commercialization or other exploration of certain T cells, subject to certain exceptions, as more fully described in “Part I—Business—Our Collaborations and Licensing Strategy” of this Annual Report on Form 10-K.
For example, under our amended and restated collaboration with BMS, we may not use directly or indirectly, or license others to use, genome editing technology in connection with any research, development, manufacture, commercialization or other exploration of certain T cells, subject to certain exceptions, as more fully described in Part I, Item 1 “Business—Our Collaborations and Licensing Strategy” of this Annual Report on Form 10-K.
We may never succeed in these activities and, even if we do, may never generate revenues that are significant or large enough to achieve profitability. Other than reni-cel, we are currently only in the preclinical testing stages for our most advanced research programs.
We may never succeed in these activities and, even if we do, may never generate revenues that are significant or large enough to achieve profitability. We are currently only in the preclinical testing stages for our most advanced research programs.
If we are unable to obtain an exclusive license to any such third-party co-owners’ interest in such patents, patent applications or other intellectual property rights, such co-owners may be able to license their rights to other third 74 Table of Contents parties, including our competitors.
If we are unable to obtain an exclusive license to any such third-party co-owners’ interest in such patents, patent applications or other intellectual property rights, such co-owners may be able to license their rights to other third parties, including our competitors.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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We consider the internal risk oversight programs of third-party service providers before engaging them in order to help protect us from any related vulnerabilities. We do not believe that there are currently any known risks from cybersecurity threats that have or are reasonably likely to materially affect us or our business strategy, results of operations or financial condition.
We consider the internal risk oversight programs of third-party service providers before engaging them in order to help protect us from any related vulnerabilities. We do not believe that there are currently any risks from known cybersecurity threats that have materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations or financial condition.
In an effort to deter prevent and detect cyber threats, we provide all employees, including part-time and temporary employees, with a data protection, cybersecurity and incident response and prevention training and compliance program, which covers timely and relevant topics, including social engineering, phishing, password protection, confidential data protection, asset use and mobile security, and educates employees on the importance of reporting all incidents immediately.
In an effort to deter prevent and detect cyber threats, we provide all employees, including part-time and temporary employees, with a data protection, cybersecurity and incident response and prevention training and compliance program, which covers a range of timely and relevant topics. Past topics have included social engineering, phishing, password protection, confidential data protection, asset use and mobile security.
The Head of Information Security has approximately 20 years of cybersecurity expertise, including more than 15 years working in information security with the U.S. Federal Reserve System, serving most recently as the Assistant Vice President for Operations and Information Security. He has received both a GIAC Security Leadership certificate and a Certified Information Systems Security Professional certification.
Federal Reserve System, serving most recently as the Assistant Vice President for Operations and Information Security. He has received both a GIAC Security Leadership certificate and a Certified Information Systems Security Professional certification.
The Audit Committee of our Board of Directors oversees our cybersecurity and data privacy risk management activities, and reports to the Board regarding such oversight as appropriate.
The Audit Committee of our Board of Directors oversees our cybersecurity and data privacy risk management activities, and reports to the Board regarding such oversight as appropriate. The Audit Committee receives updates from management regarding cybersecurity matters not less than twice per year, and is notified between such updates regarding any significant new cybersecurity threats or incidents.
We also use technology-based tools to mitigate cybersecurity risks and to bolster our employee-based cybersecurity programs.
The training and compliance program functions to educate employees on the importance of reporting all incidents immediately. We also use technology-based tools to mitigate cybersecurity risks and to bolster our employee-based cybersecurity programs. 101 Table of Contents
The Audit Committee receives updates from management regarding cybersecurity matters not less than twice per year, and is notified between such updates regarding any significant new cybersecurity threats or incidents. 99 Table of Contents Our Head of Information Security leads the operational oversight of company-wide cybersecurity strategy, policy, standards and processes, and works across relevant departments to assess and help prepare us and our employees to address cybersecurity risks.
Our Head of Information Security leads the operational oversight of company-wide cybersecurity strategy, policy, standards and processes, and works across relevant departments to assess and help prepare us and our employees to address cybersecurity risks. The Head of Information Security has approximately 20 years of cybersecurity expertise, including more than 15 years working in information security with the U.S.
Added
For additional information regarding risks we face, please refer to Part I, Item 1A “Risk Factors—Risks Related to Employee Matters, Managing Growth, Public Health and Information Technology—Security breaches and other disruptions to our information technology structure could compromise our information, disrupt our business and expose us to liability, which would cause our business and reputation to suffer” of this Annual Report on Form 10-K.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Risk Factors—Risks Related to Our Intellectual Property.” Regardless of outcome, litigation or other legal proceedings can have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors. Item 4. Mine Safety Disclosures. Not applicable. 100 Table of Contents PART II
Regardless of outcome, litigation or other legal proceedings can have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors. Item 4. Mine Safety Disclosures. Not applicable. 102 Table of Contents PART II
Certain of our intellectual property rights, including ones licensed to us under our licensing agreements, are subject to, and from time to time may be subject to, priority and validity disputes. For additional information regarding these matters, see “Item 1A.
Certain of our intellectual property rights, including ones licensed to us under our licensing agreements, are subject to, and from time to time may be subject to, priority and validity disputes. For additional information regarding these matters, see Part I, Item 1A. “Risk Factors—Risks Related to Our Intellectual Property” of this Annual Report on Form 10-K.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock trades on the Nasdaq Global Select Market under the symbol “EDIT.” Holders As of February 23, 2024, we had approximately 19 holders of record of our common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock trades on the Nasdaq Global Select Market under the symbol “EDIT.” Holders As of February 28, 2025, we had approximately 19 holders of record of our common stock.
The following graph compares the performance of our common stock to The Nasdaq Composite Index and to The Nasdaq Biotechnology Index from December 31, 2018 through December 31, 2023.
The following graph compares the performance of our common stock to The Nasdaq Composite Index and to The Nasdaq Biotechnology Index from December 31, 2019 through December 31, 2024.
The comparison assumes $100 was invested after the market closed on December 31, 2018 in our common stock and in each of the foregoing indices, and it assumes reinvestment of dividends, if any. The stock price performance included in this graph is not necessarily indicative of future stock price performance.
The comparison assumes $100 was invested after the market closed on December 31, 2019 in our common stock and in each of the foregoing indices, and it assumes reinvestment of dividends, if any. The stock price performance included in this graph is not necessarily indicative of future stock price performance. 103 Table of Contents Recent Sales of Unregistered Securities None.
Recent Sales of Unregistered Securities None. 101 Table of Contents Purchases of Equity Securities by the Issuer and Affiliates Purchasers Neither we nor any affiliated purchaser or anyone acting on behalf of us or an affiliated purchaser made any purchases of shares of our common stock during the fourth quarter of 2023. Item 6. [Reserved]
Purchases of Equity Securities by the Issuer and Affiliated Purchasers Neither we nor any affiliated purchaser or anyone acting on behalf of us or an affiliated purchaser made any purchases of shares of our common stock during the fourth quarter of 2024. Item 6. [Reserved]

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Net cash used in operating activities was approximately $132.2 million for the year ended December 31, 2023, which primarily consisted of operating expenses related to the focused progression of clinical and manufacturing activities in support of the reni-cel program, sublicense and license fees, and supporting business operations.
Net cash used in operating activities was approximately $132.2 million for the year ended December 31, 2023, which primarily consisted of operating expenses related to the focused progression of clinical and manufacturing activities in support of our former reni-cel program, sublicense and license fees, and supporting business operations.
If we raise funds through additional collaborations, strategic alliances, or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs, or product candidates or to grant licenses on terms that may not be favorable to us.
If we raise funds through additional collaborations, strategic alliances, licensing arrangements, or future royalty sales with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs, or product candidates or to grant licenses on terms that may not be favorable to us.
In connection with our collaboration with BMS, we have received an aggregate of $135.5 million in payments, which have primarily consisted of the initial upfront and amendment payments, development milestone payments and research funding support. We no longer receive research funding support.
In connection with our collaboration with BMS, we have received an aggregate of $146.5 million in payments, which have primarily consisted of the initial upfront and amendment payments, development milestone payments and research funding support. We no longer receive research funding support.
We do not expect to be profitable for the year ending December 31, 2024 or the foreseeable future. Financial Operations Overview Revenue To date, we have not generated any revenue from product sales and we do not expect to generate any revenue from product sales for the foreseeable future.
We do not expect to be profitable for the year ending December 31, 2025 or the foreseeable future. Financial Operations Overview Revenue To date, we have not generated any revenue from product sales and we do not expect to generate any revenue from product sales for the foreseeable future.
There may be instances in which payments made to our service providers will exceed the level of services 106 Table of Contents performed and result in a prepayment of the clinical expense. Payments under some of these contracts depend on factors such as the successful enrollment of patients and the completion of clinical milestones.
There may be instances in which payments made to our service providers will exceed the level of services performed and result in a prepayment of the clinical expense. Payments under some of these contracts depend on factors such as the successful enrollment of patients and the completion of clinical milestones.
Net Cash (Used in) Provided by Investing Activities Net cash used in investing activities was approximately $3.7 million for the year ended December 31, 2023, primarily related to the purchase of property and equipment of $4.7 million. The remaining offset relates to maturities of marketable securities of $259.5 million and purchases of marketable securities of $258.5 million.
Net cash used in investing activities was approximately $3.7 million for the year ended December 31, 2023, primarily related to the purchase of property and equipment of $4.7 million. The remaining offset related to maturities of marketable securities of $259.5 million and purchases of marketable securities of $258.5 million.
These costs are expensed as incurred and include: • employee-related expenses including salaries, benefits, and stock-based compensation expense; • costs incurred under clinical trial agreements with investigative sites; • costs associated with conducting our preclinical, process and scale-up development, manufacturing, quality, clinical and regulatory activities, including fees paid to third-party professional consultants, service providers and suppliers; • costs of purchasing lab supplies and non-capital equipment used in our preclinical activities and in manufacturing preclinical and clinical study materials; • costs incurred for the research and development activities under our collaboration agreements; • facility costs including rent, depreciation, and maintenance expenses; and 104 Table of Contents • fees for acquiring and maintaining licenses under our third-party licensing agreements, including any sublicensing or success payments made to our licensors.
These costs are expensed as incurred and include: • employee-related expenses including salaries, benefits, and stock-based compensation expense; • costs incurred under clinical trial agreements with investigative sites for our former reni-cel program; • costs associated with conducting our preclinical, process and scale-up development, manufacturing, quality, clinical and regulatory activities, including fees paid to third-party professional consultants, service providers and suppliers; • costs of purchasing lab supplies and non-capital equipment used in our preclinical activities and in manufacturing preclinical and clinical study materials; • costs incurred for the research and development activities under our collaboration agreements; • facility costs including rent, depreciation, and maintenance expenses; and • fees for acquiring and maintaining licenses under our third-party licensing agreements, including any sublicensing or success payments made to our licensors.
A change in the outcome of any of these variables with respect to the development of any product candidates we develop would significantly change the costs, timing, and viability associated with the development of that product candidate. Research and development activities are central to our business model.
A change in the outcome of any of these variables with respect to the development of any product candidates we develop would significantly change the costs, timing, and viability associated with the development of that product candidate. 107 Table of Contents Research and development activities are central to our business model.
We anticipate 103 Table of Contents that our expenses will increase substantially as we continue our current research programs and our preclinical development activities; progress the clinical development of reni-cel; seek to identify additional research programs and additional product candidates; initiate preclinical testing and clinical trials for other product candidates we identify and develop; maintain, expand, and protect our intellectual property portfolio, including reimbursing our licensors for such expenses related to the intellectual property that we in-license from such licensors; further develop our genome editing platform; hire additional clinical, quality control, and scientific personnel; and incur additional costs associated with operating as a public company.
We anticipate that our expenses will increase substantially as we continue our current research programs and our preclinical development activities; seek to identify additional research programs and additional product candidates; initiate preclinical testing and clinical trials for other product candidates we identify and develop; maintain, expand, and protect our intellectual property portfolio, including reimbursing our licensors for such expenses related to the intellectual property that we in-license from such licensors; further develop our genome editing platform; hire additional clinical, quality control, and scientific personnel; and incur additional costs associated with operating as a public company.
Overview We are a clinical stage genome editing company dedicated to developing potentially transformative genomic medicines to treat a broad range of serious diseases. We have developed a proprietary gene editing platform based on CRISPR technology and we continue to expand its capabilities.
Overview We are a pioneering gene editing company dedicated to developing potentially transformative genomic medicines to treat a broad range of serious diseases. We have developed a proprietary gene editing platform based on CRISPR technology and we continue to expand its capabilities.
(“Vor Bio”), providing Vor Bio a non-exclusive license for the development of ex vivo Cas9 gene edited HSC therapies for the treatment and/or prevention of hematological malignancies. Under this agreement, we received an upfront payment and are eligible for future development, regulatory and commercial milestone payments, as well as royalties on medicines utilizing the related intellectual property.
(“Vor Bio”), providing Vor Bio a non-exclusive license for the development of ex vivo Cas 9 gene edited HSC therapies for the treatment and/or prevention of hematological malignancies. Under this agreement, we received an upfront payment and will be eligible for future development, regulatory and commercial milestone payments, as well as royalties on medicines utilizing the related intellectual property.
Our commercial revenues, if any, will be derived from sales of genomic medicines that we do not expect to be commercially available for years, if at all. Accordingly, we will need to continue to rely on additional financing to achieve our business objectives.
Our commercial revenues, if any, will be derived from sales of genomic medicines that we do not expect to be commercially available for years, if at all. Accordingly, we will need to continue to rely on additional financing to achieve our business objectives. Adequate additional financing may not be available to us on acceptable terms, or at all.
Our ability to earn the milestone payments and the timing of earning these amounts are dependent upon the timing and outcome of our development, regulatory and commercial activities and, as such, are uncertain at this time.
Our 112 Table of Contents ability to earn applicable milestone and other payments and the timing of earning these amounts are dependent upon the timing and outcome of development, regulatory and commercial activities and, as such, are uncertain at this time.
Our net losses were $153.2 million, $220.4 million, and $192.5 million for the years ended December 31, 2023, 2022 and 2021 respectively. As of December 31, 2023, we had an accumulated deficit of $1.2 billion. We expect to continue to incur significant expenses and operating losses for the foreseeable future.
Since inception, we have incurred significant operating losses. Our net losses were $237.1 million, $153.2 million, and $220.4 million for the years ended December 31, 2024, 2023 and 2022 respectively. As of December 31, 2024, we had an accumulated deficit of $1.5 billion. We expect to continue to incur significant expenses and operating losses for the foreseeable future.
We expect research and development costs to increase significantly for the foreseeable future as our development programs progress, including as we continue to progress our clinical trials as well as support preclinical studies for our other research programs.
We expect research and development costs to increase significantly for the foreseeable future as our development programs progress, including as we continue to support preclinical studies and prepare for the clinical development of our research programs.
Contractual Obligations As of December 31, 2023, we had non-cancelable operating leases with total future minimum lease payments of $43.4 million, of which $14.8 million will be payable in 2024. These minimum lease payments exclude our share of the facility operating expenses, real-estate taxes and other costs that are reimbursable to the landlord under the leases.
Contractual Obligations As of December 31, 2024, we had non-cancelable operating leases with total future minimum lease payments of $39.9 million, of which $17.1 million will be payable in 2025. These minimum lease payments exclude our share of the facility operating expenses, real-estate taxes and other costs that are reimbursable to the landlord under the leases.
Except for reni-cel, all of our ongoing research programs are still in the preclinical or research stage of development and the risk of failure of all of our research programs is high. We have not generated any revenue from product sales.
All of our ongoing research programs are still in the preclinical or research stage of development and the risk of failure of all of our 105 Table of Contents research programs is high. We have not generated any revenue from product sales.
In December 2023, we and Vertex Pharmaceuticals Incorporated (“Vertex”) entered into a license agreement, under which Vertex obtained a non-exclusive license for our Cas9 gene editing technology for ex vivo gene editing medicines targeting the BCL11A gene in the fields of sickle cell disease and transfusion-dependent beta thalassemia, including Vertex’s CASGEVY TM (exagamglogene autotemcel).
In addition, in December 2023, we and Vertex Pharmaceuticals Incorporated (“Vertex”) entered into a license agreement, under which Vertex obtained a non-exclusive license for our Cas9 gene editing technology for ex vivo gene editing medicines targeting the BCL11A gene in the fields of SCD and TDT, including Vertex’s CASGEVY TM (exagamglogene autotemcel).
In May 2021, we entered into a common stock sales agreement with Cowen and Company, LLC (“Cowen”) under which we from time to time can issue and sell shares of our common stock through Cowen in at-the-market offerings for aggregate gross sale proceeds of up to $300.0 million (the “ATM Facility”).
In May 2021, we entered into a common stock sales agreement with TD Securities (USA) LLC (as successor to Cowen and Company, LLC) (“TD Cowen”) under which we from time to time can issue and sell shares of our common stock through TD Cowen in at-the-market offerings for aggregate gross sale proceeds of up to $300.0 million (the “Prior ATM Facility”).
The amount and timing of future funding requirements, both near- and long-term, will depend on many factors, including, but not limited to : • the costs of progressing the clinical development of reni-cel to treat SCD and TDT; • the scope, progress, results, and costs of clinical trials, drug discovery, preclinical development, laboratory testing, and clinical or natural history study trials for other product candidates we develop; • the costs of preparing, filing, and prosecuting patent applications, maintaining and enforcing our intellectual property and proprietary rights, and defending intellectual property-related claims; • the costs, timing, and outcome of regulatory review of the product candidates we develop; • the costs of establishing and maintaining a supply chain for the development and manufacture of our product candidates; • the costs of future activities, including product sales, medical affairs, marketing, manufacturing, and distribution, for any product candidates for which we receive regulatory approval; • the success of our collaboration with BMS, including whether BMS exercises any of its options to extend the research program term and/or to additional research programs under our collaboration; • our ability to establish and maintain additional collaborations on favorable terms, if at all; • the extent to which we acquire or in-license other medicines and technologies; • the costs of reimbursing our licensors for the prosecution and maintenance of the patent rights in-licensed by us; and • our ability to establish and maintain healthcare coverage and adequate reimbursement for any product candidates for which we receive regulatory approval.
The amount and timing of future funding requirements, both near- and long-term, will depend on many factors, including, but not limited to : • the restructuring costs associated with the discontinuation of reni-cel; • the scope, progress, results, and costs of clinical trials, drug discovery, preclinical development, laboratory testing, and clinical or natural history study trials for other product candidates we develop; • the costs of preparing, filing, and prosecuting patent applications, maintaining and enforcing our intellectual property and proprietary rights, and defending intellectual property-related claims; • the costs, timing, and outcome of regulatory review of the product candidates we develop; • the costs of establishing and maintaining a supply chain for the development and manufacture of our product candidates; • the costs of future activities, including product sales, medical affairs, marketing, manufacturing, and distribution, for any product candidates for which we receive regulatory approval; • the success of our collaboration with BMS, including whether BMS exercises any of its options to extend the research program term and/or to additional research programs under our collaboration; • our ability to establish and maintain additional collaborations on favorable terms, if at all; • the extent to which we acquire or in-license other medicines and technologies; • the costs of reimbursing our licensors for the prosecution and maintenance of the patent rights in-licensed by us; and • our ability to establish and maintain healthcare coverage and adequate reimbursement for any product candidates for which we receive regulatory approval. 114 Table of Contents Identifying potential product candidates and conducting preclinical studies and clinical trials is a time-consuming, expensive, and uncertain process that takes many years to complete, and we may never generate the necessary data or results required to obtain marketing approval and achieve product sales.
Comparison of Years Ended December 31, 2022 and 2021 For a discussion of our results of operations for the year ended December 31, 2022 as compared to the year ended December 31, 2021, see Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations in our annual report on Form 10-K for the year ended December 31, 2022, which was filed with the SEC on February 22, 2023.
Comparison of Years Ended December 31, 2023 and 2022 For a discussion of our results of operations for the year ended December 31, 2023 as compared to the year ended December 31, 2022, see Part II, Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our annual report on Form 10-K for the year ended December 31, 2023, which was filed with the U.S.
During the year ended December 31, 2023, we recognized $4.5 million of revenue related to our collaboration with BMS of which none was previously deferred revenue. As of December 31, 2023, we had $56.7 million of deferred revenue related to BMS, of which $56.7 million is classified as long-term on our consolidated balance sheet.
During the year ended December 31, 2024, we recognized $18.1 million of revenue related to our collaboration with BMS of which $6.5 million was previously deferred revenue. As of December 31, 2024, we had $50.2 million of deferred revenue related to BMS, of which $50.2 million is classified as long-term on our consolidated balance sheet.
We have primarily financed our operations through various equity financings, payments received under our research collaboration with BMS, our former strategic alliance with Allergan Pharmaceuticals International Limited (together with its affiliates, “Allergan”), which was terminated in August 2020, and payments received in conjunction with our license agreement with Vertex . Since inception, we have incurred significant operating losses.
We have primarily financed our operations through various equity financings, payments received under our research collaboration with BMS through its wholly owned subsidiary Juno Therapeutics, our former strategic alliance with Allergan Pharmaceuticals International Limited (together with its affiliates, “Allergan”), which was terminated in August 2020, payments received under the DRI Agreement in connection with our license agreement with Vertex, and payments under the Vertex license agreement.
(“Broad”) and the President and Fellows of Harvard College (“Harvard”) a mid-double-digit percentage of amounts received from Vertex under the license agreement as it relates to Cas9 technology licensed by us from Broad and Harvard. In August 2023, we entered into a license agreement with Vor Biopharma Inc.
(“Broad”) and the President and Fellows of Harvard College (“Harvard”) a mid-double-digit percentage of amounts payable to us from Vertex under the license agreement as it relates to Cas9 technology licensed by us from Broad and Harvard.
For further information regarding these agreements, please see “Business—Our Collaborations and Licensing Strategy.” We also enter into contracts in the normal course of business with contract research organizations, contract manufacturing organizations and other vendors to assist in the performance of our research and development activities and other services and products for operating purposes.
For further information regarding these agreements, please see Part I, Item 1 “Business—Our Collaborations and Licensing Strategy” of this Annual Report on Form 10-K. 115 Table of Contents We also enter into contracts in the normal course of business with contract research organizations, contract manufacturing organizations and other vendors to assist in the performance of our research and development activities and other services and products for operating purposes.
We received a $50.0 million upfront cash payment and are eligible to receive an additional $50.0 million contingent upfront payment. We are also eligible to receive annual license fees, ranging from $10.0 million to $40.0 million annually, inclusive of certain sales-based annual license fee increases, through 2034. We are required to pay The Broad Institute, Inc.
The license agreement further provides for the payment by Vertex of a potential additional $50.0 million contingent upfront payment and further future fixed and sales-based annual license fees, ranging from $10.0 million to $40.0 million annually, inclusive of certain sales-based annual license fee increases, through 2034. We are required to pay The Broad Institute, Inc.
We have not sold any shares of our common stock under this ATM Facility as of the date of this Annual Report on Form 10-K. In addition to our existing cash, cash equivalents and marketable securities, we are eligible to earn milestone and other payments under our collaboration agreement with BMS and our other collaboration and license agreements.
As of December 31, 2024, we had not sold any shares of our common stock under the Prior ATM Facility or the ATM Facility. In addition to our existing cash, cash equivalents and marketable securities, we are eligible to earn milestone and other payments under our collaboration agreement with BMS and our other collaboration and license agreements.
Net cash provided by financing activities was approximately $1.3 million for the year ended December 31, 2022 primarily related to proceeds received from issuance of common stock under our employee stock purchase plan and exercises of options for our common stock.
Net Cash Provided by Financing Activities Net cash provided by financing activities was approximately $56.0 million for the year ended December 31, 2024 primarily related to net proceeds received from the sale of future revenue of $55.2 million, proceeds received from issuance of common stock under our employee stock purchase plan of $0.6 million and proceeds from the exercise of stock options of $0.2 million.
In cellular therapy medicines, we are leveraging partnerships to progress engineered cell medicines to treat various cancers. We are advancing alpha-beta T-cell experimental medicines for the treatment of solid and liquid tumors in collaboration with Bristol Myers Squibb Company (“BMS”) through its wholly owned subsidiary, Juno Therapeutics, Inc. (“Juno Therapeutics”).
For example, in cellular therapy medicines, we are leveraging partnerships to progress engineered cell medicines to treat various cancers, including in our collaboration with Bristol Myers Squibb Company (“BMS”) through its wholly owned subsidiary, Juno Therapeutics, Inc. (“Juno Therapeutics”).
While our significant accounting policies are described in more detail in the notes to our consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K, we believe the following accounting policies used in the preparation of our consolidated financial statements requires the most significant judgments and estimates.
While our significant accounting policies are described in more detail in the notes to our consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K, we believe the following accounting policies used in the preparation of our consolidated financial statements requires the most significant judgments and estimates. 108 Table of Contents Revenue Recognition We recognize revenue in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”), Topic 606, Revenue Recognition (“ASC 606”).
We are pursuing the right combination of gene editing and targeted delivery tools through internal development and the in-licensing of complementary technologies, while also leveraging our intellectual property portfolio to drive potential out-licensing and partnership discussions that can accelerate the achievement of our goal of delivering lifesaving medicines to patients with previously untreatable diseases.
We are pursuing the right combination of gene editing and targeted delivery tools through internal development and the in-licensing of complementary technologies to build our preclinical pipeline and accelerate the achievement of our goal of delivering lifesaving medicines to patients with previously untreatable diseases.
Funding Requirements We expect our expenses to increase in connection with our ongoing activities, particularly as we progress the clinical development of reni-cel; further advance our research programs and our preclinical development activities; seek to identify product candidates and additional research programs; initiate preclinical testing and clinical trials for other product 110 Table of Contents candidates we identify and develop; maintain, expand, and protect our intellectual property portfolio, including reimbursing our licensors for expenses related to the intellectual property that we in-license from such licensors; hire additional clinical, quality control, and scientific personnel; and incur costs associated with operating as a public company.
Funding Requirements We expect our expenses to decrease over the next few years due to the discontinuation of the reni-cel program, but we will continue to incur significant expenses as we continue to advance our research programs and our preclinical development activities; seek to identify product candidates and additional research programs; initiate preclinical testing and clinical trials for other product candidates we identify and develop; maintain, expand, and project our intellectual property portfolio, including reimbursing our licensors for expenses related to the intellectual property that we in-license from such licensors; and incur costs associated with operating as a public company.
General and Administrative Expenses General and administrative expenses decreased by approximately $1.1 million, to $69.7 million for the year ended December 31, 2023 from $70.7 million for the year ended December 31, 2022.
General and Administrative Expenses General and administrative expenses increased by approximately $2.3 million, to $72.0 million for the year ended December 31, 2024 from $69.7 million for the year ended December 31, 2023.
We expect that our existing cash, cash equivalents and marketable securities on December 31, 2023, together with the near-term annual license fees and the contingent upfront payment payable under our license agreement with Vertex, will fund our operating expenses and capital expenditure requirements into 2026.
We expect that our existing cash, cash equivalents and marketable securities on December 31, 2024, together with the retained portions of the payments payable under our license agreement with Vertex, will fund our operating expenses and capital expenditure requirements into the second quarter of 2027.
These increases were partially offset by the following decreases in research and development expenses: • approximately $26.5 million in decreased external research and development expenses primarily related to our strategic reprioritization and targeted focus on our reni-cel program; and • approximately $2.6 million in decreased stock-based compensation expense due primarily to a reduction in the market price of our common stock, resulting in a lower valuation of equity awards granted.
These increases were partially offset by the following decreases in research and development expenses: • approximately $16.1 million in decreased sublicense and license fees related to reduced licensing activity in 2024 compared to 2023; and • approximately $1.2 million in decreased stock-based compensation expense due primarily to a reduction in the market price of our common stock, resulting in a lower valuation of equity awards granted.
Upon execution of the license agreement with Vertex, we received a $50.0 million upfront cash payment and are eligible to receive an additional $50.0 million contingent upfront payment. We are also eligible to receive annual license fees, ranging from $10.0 million to $40.0 million annually, inclusive of certain sales-based annual license fee increases, through 2034.
The license agreement further provides for the payment by Vertex of a potential additional $50.0 million contingent upfront payment and further future fixed and sales-based annual license fees, ranging from $10.0 million to $40.0 million annually, inclusive of certain sales-based annual license fee increases, through 2034.
Net cash provided by investing activities was approximately $114.1 million for the year ended December 31, 2022, primarily related to proceeds from maturities of marketable securities of $433.4 million, partially offset by the cost of acquiring marketable securities of $315.2 million and purchases of property and equipment of $4.1 million.
Net Cash Provided by (Used in) Investing Activities Net cash provided by investing activities was approximately $162.1 million for the year ended December 31, 2024, primarily related to maturities of marketable securities of $257.2 million. This was offset by $86.2 million of purchases of marketable securities and purchases of property and equipment of $8.8 million.
Adequate additional financing may not be available to us on acceptable terms, or at all. 111 Table of Contents Until such time, if ever, as we can generate substantial product revenues, we expect to finance our cash needs through a combination of equity offerings, debt financings, collaborations, strategic alliances, and licensing arrangements.
Until such time, if ever, as we can generate substantial product revenues, we expect to finance our cash needs through a combination of equity offerings, debt financings, collaborations, strategic alliances, licensing arrangements and future royalty sales.
As of December 31, 2023, we have recorded $60.0 million of revenue related to the agreement. For additional information about our revenue recognition policy related to the Vertex license agreement and BMS collaboration, see “—Critical Accounting Policies and Estimates—Revenue Recognition” included in this Annual Report on Form 10-K.
For additional information about our revenue recognition policy related to the Vertex license agreement and BMS collaboration, see Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates—Revenue Recognition” included in this Annual Report on Form 10-K.
Other significant costs include corporate facility costs not otherwise included in research and development expenses, legal fees related to intellectual property and corporate matters, and fees for accounting and consulting services.
Other significant costs include corporate facility costs not otherwise included in research and development expenses, legal fees related to intellectual property and corporate matters, and fees for accounting and consulting services. We anticipate that our general and administrative expenses will decrease or remain flat in the near future to support continued research and development activities.
With respect to reimbursement of third-party intellectual property-related expenses specifically, given the ongoing nature of the opposition and interference proceedings involving the patents licensed to us under our license agreement with Broad and the President and Harvard, we anticipate general and administrative expenses will continue to be significant. 105 Table of Contents Other Income (Expense), Net For the years ended December 31, 2023, and 2022, other income (expense), net consisted primarily of changes in interest income and accretion of discounts associated with other marketable securities.
With respect to reimbursement of third-party intellectual property-related expenses specifically, given the ongoing nature of the opposition and interference proceedings involving the patents licensed to us under our license agreement with Broad and Harvard, we anticipate general and administrative expenses associated with reimbursement of third-party intellectual property-related expense will continue to fluctuate as the interference proceedings continue.
Net Cash Provided by Financing Activities Net cash provided by financing activities was approximately $118.0 million for the year ended December 31, 2023 primarily related to proceeds received from the public offering of common stock, net of issuance costs, of $117.1 million in June 2023 and proceeds received from issuance of common stock under our employee stock purchase plan of $0.9 million.
Net cash provided by financing activities was approximately $118.0 million for the year ended December 31, 2023, primarily related to proceeds received from the public offering of common stock, net of issuance costs, of $117.1 million in June 2023 and proceeds received from issuance of common stock under our employee stock purchase plan of $0.9 million. 113 Table of Contents For a discussion of our cash flows for the year ended December 31, 2022, see Part II, Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2023, which was filed with the SEC on February 28, 2024.
These decreases were partially offset by approximately $8.1 million in increased professional services to support strategic initiatives and business development activities. Total Other Income, Net For the years ended December 31, 2023, and 2022, total other income, net was $16.0 million and $5.5 million, respectively, which was primarily attributable to interest income and accretion of discounts associated with marketable securities.
Total Other Income, Net For the years ended December 31, 2024, and 2023, total other income, net was $14.1 million and $16.0 million, respectively, which was primarily attributable to interest income and accretion of discounts associated with marketable securities. The decrease was attributable to reduction of investment balances offset by increased market rates.
We also anticipate increased expenses related to reimbursement of third-party patent-related expenses and expenses associated with operating as a public company, including costs for audit, legal, regulatory, and tax-related services, director and officer insurance premiums, and investor relations costs.
We anticipate that expenses associated with operating as a public company, including costs for audit, legal, regulatory, and tax-related services, director and officer insurance premiums, and investor relation costs will remain flat or decrease in the near future.
For the foreseeable future we expect substantially all of our revenue will be generated from our license agreement with Vertex, collaboration with BMS, and any other collaborations or license agreements we may enter into.
For the foreseeable future we expect substantially all of our revenue will be generated from our license agreements with Vertex and Vor Bio, collaboration with BMS, and any other collaborations or license agreements we may enter into. 106 Table of Contents Expenses Research and Development Expenses Research and development expenses consist primarily of costs incurred for our research, preclinical development, process and scale-up development, manufacture and clinical development of our product candidates, and the performance of development activities under our collaboration agreements.
As of December 31, 2023 , our right to contingent payments under our collaboration agreements with BMS and Vor Bio as well as our contingent upfront payment and annual license fees with Vertex are our only significant committed potential external source of funds. 109 Table of Contents Cash Flows The following table provides information regarding our cash flows for the years ended December 31, 2023 and 2022, respectively (in thousands): Year Ended December 31, 2023 2022 Net cash (used in) provided by: Operating activities $ (132,178) $ (177,349) Investing activities (3,731) 114,068 Financing activities 118,039 1,284 Net decrease in cash, cash equivalents, and restricted cash $ (17,870) $ (61,997) Net Cash Used in Operating Activities The use of cash in all periods resulted primarily from our net losses adjusted for non-cash charges and changes in components of working capital.
Cash Flows The following table provides information regarding our cash flows for the years ended December 31, 2024 and 2023, respectively (in thousands): Year Ended December 31, 2024 2023 Net cash (used in) provided by: Operating activities $ (210,284) $ (132,178) Investing activities 162,146 (3,731) Financing activities 56,027 118,039 Net increase (decrease) in cash, cash equivalents, and restricted cash $ 7,889 $ (17,870) Net Cash Used in Operating Activities The use of cash in all periods resulted primarily from our net losses adjusted for non-cash charges and changes in components of working capital.
In the second quarter of 2023, we entered into a license and service agreement pursuant to which we will lease manufacturing space for our continued research and development activities. As of December 31, 2023, the lease had not commenced for accounting purposes and it is not expected to commence until the first half of 2024.
In 2023, we entered into a license and service agreement pursuant to which we leased manufacturing space for our continued research and development activities. The lease commenced April 1, 2024.
The increase was primarily attributable to revenue recognized under our license agreement with Vertex pursuant to the license agreement executed in December 2023. Research and Development Expenses Research and development expenses increased by $2.7 million, to $177.7 million for the year ended December 31, 2023 from $175.0 million for the year ended December 31, 2022.
Collaboration and Other Research and Development Revenues Collaboration and other research and development revenues decreased by $45.8 million, to $32.3 million for the year ended December 31, 2024, from $78.1 million for the year ended December 31, 2023. The decrease was primarily attributable to revenue recognized in 2023 under our license agreement with Vertex, which was executed in December 2023.
The following table summarizes our research and 107 Table of Contents development expenses for the years ended December 31, 2023 and December 31, 2022, together with the changes in those items in dollars (in thousands) and the respective percentages of change: Year Ended December 31, Dollar Change Percentage Change 2023 2022 Employee related expenses $ 47,363 $ 47,320 $ 43 — % External research and development expenses 53,321 79,822 (26,501) (33) % Facility expenses 21,447 21,032 415 2 % Stock-based compensation expenses 9,842 12,425 (2,583) (21) % Sublicense and license fees 35,011 5,334 29,677 n/m Other expenses 10,667 9,025 1,642 18 % Total research and development expenses $ 177,651 $ 174,958 $ 2,693 2 % The increase in research and development expenses for the year ended December 31, 2023 compared to the year ended December 31, 2022 was primarily attributable to: • approximately $29.7 million in increased sublicense and license fees primarily attributable to payments made related to our license agreement with Vertex; • approximately $1.6 million in increased other expenses attributable to consulting and external fees to support clinical and quality initiatives; and • approximately $0.4 million in increased facility expenses.
The following table summarizes our research and development expenses for the years ended December 31, 2024 and December 31, 2023, together with the changes in those items in dollars (in thousands) and the respective percentages of change: Year Ended December 31, Dollar Change Percentage Change 2024 2023 Employee related expenses $ 54,231 $ 47,363 $ 6,868 15 % External research and development expenses 78,453 53,321 25,132 47 % Facility expenses 26,430 21,447 4,983 23 % Stock-based compensation expenses 8,642 9,842 (1,200) (12) % Sublicense and license fees 18,953 35,011 (16,058) (46) % Other expenses 12,538 10,667 1,871 18 % Total research and development expenses $ 199,247 $ 177,651 $ 21,596 12 % 110 Table of Contents The increase in research and development expenses for the year ended December 31, 2024 compared to the year ended December 31, 2023 was primarily attributable to: • approximately $25.1 million in increased external research and development expenses primarily related to clinical and manufacturing costs related to the progression of our former reni-cel program as well as costs attributable to in vivo research and discovery; • approximately $6.9 million in increased employee related expenses related to increased headcount; • approximately $5.0 million in increased facility expenses primarily related to increased rent expense incurred in connection with a lease commencement for manufacturing space in the second quarter of 2024; and • approximately $1.9 million in increased other expenses attributable to consulting and external fees to support clinical and quality initiatives.
Net cash used in operating activities was approximately $177.3 million for the year ended December 31, 2022, which primarily consisted of operating expenses related to our on-going preclinical and clinical activities, sublicense and license fees, and increased personnel costs to support our expanding operations.
Net cash used in operating activities was approximately $210.3 million for the year ended December 31, 2024, which primarily consisted of operating expenses that related to increasing our research efforts, the progression of clinical and manufacturing activities in support of our former reni-cel program and supporting business operations.
Results of Operations Comparison of Years Ended December 31, 2023 and 2022 The following table summarizes our results of operations for the years ended December 31, 2023 and 2022, together with the changes in those items in dollars (in thousands) and the respective percentages of change: Year Ended December 31, Dollar Change Percentage Change 2023 2022 Collaboration and other research and development revenues $ 78,123 $ 19,712 $ 58,411 n/m Operating expenses: Research and development 177,651 174,958 2,693 2 % General and administrative 69,653 70,704 (1,051) (1) % Total operating expenses 247,304 245,662 1,642 1 % Operating loss (169,181) (225,950) 56,769 (25) % Other income, net: Other income, net (1,604) — (1,604) n/m Interest income, net 17,566 5,518 12,048 n/m Total other income, net 15,962 5,518 10,444 n/m Net loss $ (153,219) $ (220,432) $ 67,213 (30) % For our results of operations, we have included the respective percentage of changes, unless greater than 100% or less than (100)%, in which case we have denoted such changes as not meaningful (n/m).
To date, there have been no material differences from our estimates to the amounts actually incurred. 109 Table of Contents Results of Operations Comparison of Years Ended December 31, 2024 and 2023 The following table summarizes our results of operations for the years ended December 31, 2024 and 2023, together with the changes in those items in dollars (in thousands) and the respective percentages of change: Year Ended December 31, Dollar Change Percentage Change 2024 2023 Collaboration and other research and development revenues $ 32,314 $ 78,123 $ (45,809) (59) % Operating expenses: Research and development 199,247 177,651 21,596 12 % General and administrative 71,987 69,653 2,334 3 % Restructuring charges 12,232 — 12,232 100 % Total operating expenses 283,466 247,304 36,162 15 % Operating loss (251,152) (169,181) (81,971) 48 % Other income, net: Other expense, net (3) (1,604) 1,601 n/m Interest income, net 14,062 17,566 (3,504) (20) % Total other income, net 14,059 15,962 (1,903) (12) % Net loss $ (237,093) $ (153,219) $ (83,874) 55 % For our results of operations, we have included the respective percentage of changes, unless greater than 100% or less than (100)%, in which case we have denoted such changes as not meaningful (n/m).
Collaboration and Other Research and Development Revenues Collaboration and other research and development revenues increased by $58.4 million, to $78.1 million for the year ended December 31, 2023, from $19.7 million for the year ended December 31, 2022.
Research and Development Expenses Research and development expenses increased by $21.5 million, to $199.2 million for the year ended December 31, 2024 from $177.7 million for the year ended December 31, 2023.
Liquidity and Capital Resources Sources of Liquidity As of December 31, 2023, we have raised an aggregate of $1.0 billion in net proceeds through the sale of shares of our common stock in public offerings and at-the-market offerings, including a public offering of our common stock in June 2023, pursuant to which we sold 12,500,000 shares of our common stock and received net proceeds of approximately $117.1 million after deducting underwriting discounts and commissions and other offering costs.
Securities and Exchange Commission (the “SEC”) on February 28, 2024. Liquidity and Capital Resources Sources of Liquidity As of December 31, 2024, we have raised an aggregate of $1.0 billion in net proceeds through the sale of shares of our common stock in public offerings and at-the-market offerings.
We also have funded our business from our research collaboration with BMS, our former strategic alliance with Allergan, and payments received under the license agreement with Vertex. As of December 31, 2023, we had cash, cash equivalents and marketable securities of $427.1 million.
We also have funded our business from our research collaboration with BMS through its wholly owned subsidiary Juno Therapeutics, our former strategic alliance with Allergan (which was terminated in August 2020), payments received under the DRI Agreement in connection with our license agreement with Vertex, and payments under the Vertex license agreement.
The following table summarizes our general and administrative expenses for the years ended December 31, 2023 and December 31, 2022, together with the changes in those items in dollars (in thousands) and the respective percentages of change: Year Ended December 31, Dollar Change Percentage Change 2023 2022 Employee related expenses $ 16,969 $ 17,321 $ (352) (2) % Professional service expenses 19,575 11,496 8,079 70 % Intellectual property and patent related fees 13,268 14,784 (1,516) (10) % Stock-based compensation expenses 9,956 16,869 (6,913) (41) % Facility and other expenses 9,885 10,234 (349) (3) % Total general and administrative expenses $ 69,653 $ 70,704 $ (1,051) (1) % 108 Table of Contents The decrease in general and administrative expenses for the year ended December 31, 2023 compared to the year ended December 31, 2022 was primarily attributable to: • approximately $6.9 million in decreased stock-based compensation expense related to performance awards granted to our former Chief Executive Officer that were achieved or deemed probable in 2022, for which there was no similar expense in 2023, as well as a reduction in the market price of our common stock, resulting in a lower valuation of equity and awards granted; • approximately $1.5 million in decreased intellectual property and patent related fees due to reduced legal activity; • approximately $0.4 million in decreased employee related expenses; and • approximately $0.3 million in decreased facility and other expenses.
The following table summarizes our general and administrative expenses for the years ended December 31, 2024 and December 31, 2023, together with the changes in those items in dollars (in thousands) and the respective percentages of change: Year Ended December 31, Dollar Change Percentage Change 2024 2023 Employee related expenses $ 20,766 $ 16,969 $ 3,797 22 % Professional service expenses 14,278 19,575 (5,297) (27) % Intellectual property and patent related fees 14,016 13,268 748 6 % Stock-based compensation expenses 12,775 9,956 2,819 28 % Facility and other expenses 10,152 9,885 267 3 % Total general and administrative expenses $ 71,987 $ 69,653 $ 2,334 3 % The increase in general and administrative expenses for the year ended December 31, 2024 compared to the year ended December 31, 2023 was primarily attributable to: • approximately $3.8 million in increased employee related expenses related to increased headcount; • approximately $2.8 million in increased stock-based compensation expense due primarily to the vesting of certain restricted stock units upon the achievement of performance-based milestones in 2024, along with an increased headcount; • approximately $0.7 million in increased intellectual property and patent related fees for legal activity; • approximately $0.3 million in increased facility and other expenses. 111 Table of Contents These increases were partially offset by approximately $5.3 million in decreased professional services expenses primarily related to one-time expenses incurred in 2023 to support strategic initiatives and business development activities.
This collaboration, which leverages our Cas9 and AsCas12a platform technologies, has resulted in 13 total programs. We have also entered into a non-exclusive collaboration and licensing agreement with Immatics N.V. to combine gamma-delta T cell adoptive cell therapies and gene editing to develop medicines for the treatment of cancer.
This collaboration, which leverages our Cas9 and AsCas12a platform technologies, seeks to advance alpha-beta T-cell experimental medicines for the treatment of solid and liquid tumors, and has resulted in 14 total programs to date.
In 2023, we strengthened and focused our discovery organization to build an in vivo gene editing pipeline, and are on track to establish in vivo preclinical proof-of-concept for an undisclosed indication by year-end 2024.
We are on track to declare a development candidate for an in vivo gene editing medicine in liver cells for an undisclosed indication in mid-2025 and to establish and disclose an extrahepatic, non-HSC target cell type or tissue by the end of 2025.
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W e are focused on advancing gene editing medicines to treat hemoglobinopathies, beginning with the continued development of our current ex vivo renizgamglogene autogedtemcel ("reni-cel") (formerly known as EDIT-301) program and leveraging the insights gained from this program to pursue next generation in vivo gene editing medicines targeting hematopoietic stem cells (“HSCs”).
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We are focused on the development of in vivo gene editing medicines utilizing functional upregulation, which aims to increase the expression and function of a normal gene copy and its normal protein function to treat diseases caused by genetic mutations that eliminate or disrupt normal function.
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We are also pursuing the development of in vivo gene editing medicines for other organs and tissues that we believe will significantly differentiate our genome editing approach from the current standards of care for serious diseases.
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We believe the ability to provide in vivo gene editing, in which the medicine is injected or infused into the patient to edit the cells inside their body, and functionally upregulates normal gene expression and normal protein function in the target tissues holds the potential to significantly expand the addressable therapeutic possibilities of CRISPR-based gene editing.
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As part of these efforts, we are using strategic partnerships and collaborations and pursuing further opportunities to extend the reach of our intellectual property portfolio and access complementary technologies to expedite our drug discovery and clinical execution objectives.
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To that end, our preclinical efforts are also focused on the creation of a “plug ‘n play” LNP platform that enables delivery of the gene editing cargo to multiple cells and tissues, including hematopoietic stem cells (“HSCs”), the liver and other cells and tissues.
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Our lead program, reni-cel, is an experimental ex vivo gene-edited medicine to treat sickle cell disease (“SCD”), a severe inherited blood disease that causes premature death, and transfusion-de pendent beta thalassemia (“TDT”), the most severe form of beta-thalassemia, another inherited blood disorder characterized by severe anemia.
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We previously demonstrated proof of concept of our functional upregulation strategy in our clinical trials of renizgamglogene autogedtemcel (“reni-cel”), an experimental ex vivo gene-edited medicine to treat sickle cell disease (“SCD”) and transfusion-dependent beta thalassemia (“TDT”).
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We are investigating reni-cel in a single Phase 1/2/3 clinical trial, referred to as the RUBY trial, for the treatment of severe SCD. In 2022, we dosed the first patient in the RUBY trial, and after completing sequential dosing of the first two patients, we commenced concurrent patient dosing in the first quarter of 2023.
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Despite the robust and clinically meaningful improvements observed in these trials, we determined in December 2024 not to pursue commercialization for reni-cel in order to optimize our cost structure and accelerate our intent to achieve in vivo human proof of concept in approximately two years.
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Through February 28, 2024, we have enrolled 40 patients and dosed 18 patients in the RUBY trial . We continue to enroll and dose patients in the adult cohort of the RUBY trial, with multiple patients scheduled for dosing. We have also initiated enrollment in the adolescent cohort. In December 2021, the U.S.
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However, l everaging our differentiated approach and the insights gained from these trials, we are initially focused on pursuing next generation in vivo gene editing medicines targeting HSCs.
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Food and Drug Administration (the "FDA") cleared our Investigational New Drug (“IND”) application for a Phase 1/2 clinical trial of reni-cel for the treatment of TDT, which we refer to as our EdiTHAL.
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In October 2024, we shared our achievement of in vivo preclinical proof of concept of hematopoietic stem and progenitor cell editing and fetal hemoglobin induction in 104 Table of Contents humanized mice engrafted with human HSCs and lacking their own hematopoietic cells using a novel and proprietary targeted lipid nanoparticle (“tLNP”) formulation for non-liver, or extrahepatic, tissue delivery.
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We dosed the first patient in this trial in the first quarter of 2023 and commenced concurrent patient dosing in the second 102 Table of Contents quarter of 2023. Through February 28, 2024, we have enrolled 9 patients and dosed 7 patients in the EdiTHAL trial, and continue to enroll and dose patients.
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Building on this achievement, in January 2025, we announced in vivo preclinical proof of concept of editing HSCs in non-human primates, a key step in developing a treatment for SCD and TDT. We are on track to declare a development candidate in HSCs for the in vivo treatment of SCD and TDT in mid-2025.
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In December 2023, we presented new safety and efficacy data in 17 patients treated with reni-cel in both the RUBY and EdiTHAL trials.
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Beyond hemoglobinopathies, our discovery and development efforts are focused on in vivo gene editing medicines in liver cells and other cells and tissues.
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This clinical data, which remained consistent with and further confirmed earlier clinical results shared in June 2023 and December 2022, supports our belief that reni-cel can be a clinically differentiated, one-time, durable medicine that can provide life-changing clinical benefits to patients with SCD and TDT, specifically driving early and robust correction of anemia and sustained increases in fetal hemoglobin.
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In preclinical studies for an undisclosed liver target, we have achieved an editing level of approximately 65% in non-human primates, near the theoretical maximum liver editing level of 70%, with minimal non-target tissue editing using AsCas12a and a liver targeted lipid nanoparticle (“LNP”). This editing resulted in robust serum biomarker reduction from the baseline of approximately 80%.
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For additional information regarding these clinical data, please see “Business—Our Gene Editing Medicine Programs—Hemoglobinopathies.” We expect to provide a clinical data updates for both the RUBY and EdiTHAL trials in mid-2024 and by year-end 2024.
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We further announced in vivo delivery to two additional cell types in humanized mice using our proprietary LNP targeting platform.
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We are also pursuing the development of next generation in vivo administered gene editing medicines, in which the medicine is injected or infused into the patient to edit the cells inside their body. We are initially focused on editing HSCs through targeted delivery of our AsCas12a enzyme to our clinically validated HBG1 and HBG2 promotor site.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Treasuries and corporate debt securities. Our primary exposure to market risk is interest rate sensitivity, which is affected by changes in the general level of U.S. interest rates, particularly because our investments, including cash equivalents, are in the form, or may be in the form of, money market funds or marketable securities and are or may be invested in U.S.
Our primary exposure to market risk is interest rate sensitivity, which is affected by changes in the general level of U.S. interest rates, particularly because our investments, including cash equivalents, are in the form, or may be in the form of, money market funds or marketable securities and are or may be invested in U.S.
While we contract with certain vendors and institutions internationally, substantially all of our total liabilities as of December 31, 2023 were denominated in the United States dollar and we believe that we do not have any material exposure to foreign currency exchange rate risk. 112 Table of Contents
While we contract with certain vendors and institutions internationally, substantially all of our total liabilities as of December 31, 2024 were denominated in the United States dollar and we believe that we do not have any material exposure to foreign currency exchange rate risk. 116 Table of Contents
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. We are exposed to market risk related to changes in interest rates. As of December 31, 2023, we had cash and cash equivalents of $123.7 million, primarily held in money market mutual funds consisting of U.S. government-backed securities, and marketable securities of $303.5 million, primarily consisting of U.S. government-backed securities, U.S.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. We are exposed to market risk related to changes in interest rates. As of December 31, 2024, we had cash and cash equivalents of $131.5 million, primarily held in money market mutual funds, and marketable securities of $138.4 million, primarily consisting of U.S. government-backed securities, U.S. Treasuries and corporate debt securities.

Other EDIT 10-K year-over-year comparisons