10q10k10q10k.net

What changed in Intellia Therapeutics, Inc.'s 10-K — 2022 vs 2023

vs

Paragraph-level year-over-year comparison of Intellia Therapeutics, Inc.'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+622 added−682 removedSource: 10-K (2024-02-22) vs 10-K (2023-02-23)

Top changes in Intellia Therapeutics, Inc.'s 2023 10-K

622 paragraphs added · 682 removed · 490 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

199 edited+46 added−120 removed263 unchanged
Biggest changeAmong the provisions of the ACA of greatest importance to the pharmaceutical industry are that the ACA: • subjects biological products to potential competition by biosimilars; • made several changes to the Medicaid Drug Rebate Program, including increasing pharmaceutical manufacturers’ rebate liability by raising the minimum basic Medicaid rebate on most branded prescription drugs to 23.1% of average manufacturer price (“AMP”), and adding a new rebate calculation for “line extensions” (i.e., new formulations, such as extended release formulations) of solid oral dosage forms of branded products, as well as potentially impacting their rebate liability by modifying the statutory definition of AMP; • imposed a requirement on manufacturers of branded drugs to provide a 50% (increased to 70% on January 1, 2019 pursuant to subsequent legislation) point‑of‑sale discount off the negotiated price of branded drugs 42 dispensed to Medicare Part D beneficiaries in the coverage gap (i.e., “donut hole”) as a condition for a manufacturer’s outpatient drugs being covered under Medicare Part D; • extended a manufacturer’s Medicaid rebate liability to covered drugs dispensed to individuals who are enrolled in Medicaid managed care organizations; • expanded the entities eligible for discounts under the 340B Drug Discount Program; • established a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted, or injected; • imposed an annual, nondeductible fee and tax on any entity that manufactures or imports certain branded prescription drugs, apportioned among these entities according to their market share in certain government healthcare programs; • imposed new reporting requirements on drug manufacturers for payments made to physicians and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members.
Biggest changeAmong the provisions of the ACA of greatest importance to the pharmaceutical industry are that the ACA: • subjects biological products to potential competition by biosimilars; • increased the minimum Medicaid rebates owed by most manufacturers under the Medicaid Drug Rebate Program; • created a Medicare Part D coverage gap discount program, in which manufacturers must agree to provide a 70% point‑of‑sale discount off the negotiated price of applicable branded drugs to eligible beneficiaries 38 during their coverage gap period, as a condition for a manufacturer’s outpatient drugs being covered under Medicare Part D; • extended a manufacturer’s Medicaid rebate liability to covered drugs dispensed to individuals who are enrolled in Medicaid managed care organizations; • expanded the entities eligible for discounts under the 340B Drug Discount Program; • imposed an annual, nondeductible fee and tax on any entity that manufactures or imports certain branded prescription drugs, apportioned among these entities according to their market share in certain government healthcare programs; and • established mechanisms to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research.
CRISPR/Cas9 genome editing has the potential to make permanent, precisely targeted changes in a patient’s chromosomes and repair the underlying genetic mutation, whereas more traditional gene therapy typically involves introducing a non-permanent copy of a gene into a patient’s cells. 6 Strategy Our strategy is to advance our full-spectrum genome editing company, focused on developing and commercializing curative CRISPR/Cas9-based therapeutics, by leveraging our modular platforms.
CRISPR/Cas9 genome editing has the potential to make permanent, precisely targeted changes in a patient’s chromosomes and repair the underlying genetic mutation, whereas more traditional gene therapy typically involves introducing a non-permanent copy of a gene into a patient’s cells. 6 Strategy Our strategy is to advance our full-spectrum gene editing company, focused on developing and commercializing curative CRISPR/Cas9-based therapeutics, by leveraging our modular platforms.
In addition to the components described below, we have developed robust, high volume (high throughput) capabilities centering around enabling strategic target identification and validation that we believe will provide us with a competitive advantage in creating successful therapeutic products.
In addition to the components described below, we believe we have developed robust, high volume (high throughput) capabilities centering around enabling strategic target identification and validation that we believe will provide us with a competitive advantage in creating successful therapeutic products.
There are also companies developing therapies using additional gene-editing technologies, which include Allogene Therapeutics, Inc., bluebird bio, Inc., Cellectis S.A., Precision Biosciences, Inc., Sangamo Therapeutics, Inc., Homology Medicines, Inc., Poseida Therapeutics, Inc. and Prime Medicine, Inc. We are also aware of companies developing therapies in various areas related to our specific research and development programs.
There are also companies developing therapies using additional gene-editing technologies, which include Allogene Therapeutics, Inc., bluebird bio, Inc., Cellectis S.A., Homology Medicines, Inc., Poseida Therapeutics, Inc., Precision Biosciences, Inc., Prime Medicine, Inc. and Sangamo Therapeutics, Inc. We are also aware of companies developing therapies in various areas related to our specific research and development programs.
If our operations are found to be in violation of any of such laws or any other governmental regulations that apply to us, we may be subject to penalties, including, without limitation, administrative, civil and criminal penalties, damages, fines, disgorgement, contractual damages, reputational harm, diminished profits and future earnings, the curtailment or restructuring of our operations, exclusion from participation in federal and state healthcare programs, individual imprisonment, and additional reporting obligations and oversight if we become subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with this law, any of which could adversely affect our ability to operate our business and our financial results.
If our operations are found to be in violation of any of such laws or any other governmental regulations that apply to us, we may be subject to penalties, including, without limitation, administrative, civil and criminal penalties, damages, fines, disgorgement, contractual damages, reputational harm, diminished profits and future earnings, the curtailment or restructuring of our operations, exclusion from participation in federal and state healthcare programs, individual imprisonment, and additional reporting obligations and oversight if we become subject to a corporate integrity 32 agreement or other agreement to resolve allegations of non-compliance with this law, any of which could adversely affect our ability to operate our business and our financial results.
The IRA includes several provisions that will impact our business to varying degrees, including provisions that create a $2,000 out-of-pocket cap for Medicare Part D beneficiaries, impose new manufacturer financial liability on all drugs in Medicare Part D, allow the U.S. government to negotiate Medicare Part B and Part D pricing for certain high-cost drugs and biologics without generic or biosimilar competition, require companies to pay rebates to Medicare for drug prices that increase faster than inflation, and delay the rebate rule that would require pass through of pharmacy benefit manager rebates to beneficiaries.
The IRA includes several provisions that will impact our business to varying degrees, including provisions that create a $2,000 out-of-pocket cap for Medicare Part D beneficiaries, impose new manufacturer financial liability on all drugs in Medicare Part D, allow the U.S. government to negotiate Medicare Part B and Part D 39 pricing for certain high-cost drugs and biologics without generic or biosimilar competition, require companies to pay rebates to Medicare for drug prices that increase faster than inflation, and delay the rebate rule that would require pass through of pharmacy benefit manager rebates to beneficiaries.
This exclusivity period, which may be shared amongst multiple first interchangeable products, lasts for the lesser of (i) one year after the first commercial marketing, (ii) 18 months after approval if there is no legal 33 challenge, (iii) 18 months after the resolution in the applicant’s favor of a lawsuit challenging the biologic’s patents if an application has been submitted, or (iv) 42 months after the application has been approved if a lawsuit is ongoing within the 42-month period.
This exclusivity period, which may be shared amongst multiple first interchangeable products, lasts for the lesser of (i) one year after the first commercial marketing, (ii) 18 months after approval if there is no legal challenge, (iii) 18 months after the resolution in the applicant’s favor of a lawsuit challenging the biologic’s patents if an application has been submitted, or (iv) 42 months after the application has been approved if a lawsuit is ongoing within the 42-month period.
In addition, if a product receives the first FDA approval for the indication for which it has orphan designation, the product is entitled to orphan drug exclusivity, which means the FDA may not approve any other application to market the same drug for the same orphan indication 30 for a period of seven years, except in limited circumstances, such as a showing of clinical superiority over the product with orphan exclusivity or where the manufacturer with orphan exclusivity is unable to assure sufficient quantities of the approved orphan designated product.
In addition, if a product receives the first FDA approval for the indication for which it has orphan designation, the product is entitled to orphan drug exclusivity, which means the FDA may not approve any other application to market the same drug for the same orphan indication for a period of seven years, except in limited circumstances, such as a showing of clinical superiority over the product with orphan exclusivity or where the manufacturer with orphan exclusivity is unable to assure sufficient quantities of the approved orphan designated product.
In addition, state and non-U.S. laws govern the privacy and security of health and other personal information in certain circumstances, many of which differ from each other in significant ways and may not have the same requirements, thus complicating efforts to comply with their respective provisions; • the U.S. federal physician payment transparency requirements, sometimes referred to as the “Physician Payments Sunshine Act,” created under the ACA, and their implementing regulations, which require manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually, to the Centers for Medicare and Medicaid Services (“CMS”), information related to payments or other “transfers of value” made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), other healthcare providers, and teaching hospitals, as well as ownership and investment interests held by physicians, other healthcare providers, and their immediate family members.
In addition, state and non-U.S. laws govern the privacy and security of health and other personal information in certain circumstances, many of which differ from each other in significant ways and may not have the same requirements, thus complicating efforts to comply with their respective provisions; • the U.S. federal physician payment transparency requirements, sometimes referred to as the “Physician Payments Sunshine Act,” created under the ACA, and their implementing regulations, which require manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually, to the Centers for Medicare and Medicaid Services (“CMS”), information related to payments or other “transfers of value” made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain other licensed healthcare practitioners, and teaching hospitals, as well as ownership and investment interests held by physicians, other healthcare providers, and their immediate family members.
In addition, the FDA generally requires, unless otherwise informed by the agency, pre-approval of promotional materials as a condition for accelerated approval, which could adversely impact the timing of the commercial launch of the product. FDA's Breakthrough Therapy designation program is intended to expedite the development and review of products that treat serious or life-threatening diseases or conditions.
In addition, the FDA generally requires, unless otherwise informed by the agency, pre-approval of promotional materials as a condition for accelerated approval, which could adversely impact the timing of the commercial launch of the product. 27 FDA's Breakthrough Therapy designation program is intended to expedite the development and review of products that treat serious or life-threatening diseases or conditions.
A breakthrough therapy is defined as a drug or biological product that is intended, alone or in combination with one or more other drugs, to treat a serious or life-threatening 31 disease or condition, and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development.
A breakthrough therapy is defined as a drug or biological product that is intended, alone or in combination with one or more other drugs, to treat a serious or life-threatening disease or condition, and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development.
We are pursuing targeting modalities, such as T cell receptors (“TCRs”) and chimeric antigen receptors (“CARs”), with broad potential in multiple immuno-oncology and autoimmune indications. Continuing to Leverage Strategic Partnerships to Accelerate Clinical Development. We view strategic partnerships as important drivers for accelerating the achievement of our goal of rapidly developing curative therapies.
We are pursuing targeting modalities, such as T cell receptors (“TCRs”) and chimeric antigen receptors (“CARs”), with broad potential in multiple immuno-oncology and autoimmune indications. Continuing to Leverage Strategic Partnerships to Accelerate Clinical Development. We view strategic partnerships as important drivers for accelerating the achievement of our goal of rapidly developing potentially curative therapies.
We are exploring other naturally occurring Cas9 proteins and nucleases from other bacteria, which may differ from Spy Cas9 in aspects such as specificity, size or mechanism of DNA recognition, binding and cutting. We are pursuing these alternative Cas9 forms and other nucleases through ongoing internal work, collaborations with our existing partners and scientific founders, and in-licensing opportunities.
We are exploring other naturally occurring 13 Cas9 proteins and nucleases from other bacteria, which may differ from Spy Cas9 in aspects such as specificity, size or mechanism of DNA recognition, binding and cutting. We are pursuing these alternative Cas9 forms and other nucleases through ongoing internal work, collaborations with our existing partners and scientific founders, and in-licensing opportunities.
National Institute of Health and Care Excellence (“NICE”). 25 We expect our future in vivo and ex vivo product candidates to be regulated as biologics. Biological products are subject to regulation under the Food, Drug and Cosmetic (“FD&C”) Act and the Public Health Service Act (“PHS Act”), and other federal, state, local and foreign statutes and regulations.
National Institute of Health and Care Excellence (“NICE”). We expect our future in vivo and ex vivo product candidates to be regulated as biologics. Biological products are subject to regulation under the Food, Drug and Cosmetic (“FD&C”) Act and the Public Health Service Act (“PHS Act”), and other federal, state, local and foreign statutes and regulations.
We will be eligible to receive up to $184 million per product in development and commercial milestone payments, as well as up to mid-single-digit royalties on potential future sales. In addition, the agreement grants us options to co-develop and co-commercialize up to two products worldwide with rights to lead commercialization in the U.S.
We will be eligible to receive up to $184.0 million per product in development and commercial milestone payments, as well as up to mid-single-digit royalties on potential future sales. In addition, the agreement grants us options to co-develop and co-commercialize up to two products worldwide with rights to lead commercialization in the U.S.
Additionally, marketing authorization may be granted to a similar medicinal product for the same therapeutic indication at any time if: • the second applicant can establish that its product, although similar to an orphan product, is safer, more effective or otherwise clinically superior to such authorized product; • the marketing authorization holder for the authorized orphan product consents to a second orphan medicinal product application; or • the marketing authorization holder for the authorized orphan product cannot supply enough orphan medicinal product.
Additionally, marketing authorization may be granted to a similar medicinal product for the same therapeutic indication as an authorized orphan product at any time if: • the second applicant can establish that its product, although similar to an authorized orphan product, is safer, more effective or otherwise clinically superior to such authorized product; • the marketing authorization holder for the authorized orphan product consents to a second orphan medicinal product application; or • the marketing authorization holder for the authorized orphan product cannot supply enough orphan medicinal product.
The regulatory authorities may also impose specific obligations as a condition of the marketing authorization. Such 39 risk-minimization measures or post-authorization obligations may include additional safety monitoring, more frequent submission of PSURs, or the conduct of additional clinical trials or post-authorization safety studies. RMPs and PSURs are routinely available to third parties requesting access, subject to limited redactions.
The regulatory authorities may also impose specific obligations as a condition of the marketing authorization. Such risk-minimization measures or post-authorization obligations may include additional safety monitoring, more frequent submission of PSURs, or the conduct of additional clinical trials or post-authorization safety studies. RMPs and PSURs are routinely available to third parties requesting access, subject to limited redactions.
Although general requirements for advertising and promotion of medicinal products are established under EU directives, the details are governed by regulations in each EU Member State and can differ from one country to another. The aforementioned EU rules are generally applicable in the EEA, which consists of the EU Member States, plus Norway, Liechtenstein and Iceland.
Although general requirements for advertising and promotion of medicinal products are established under EU directives, the details are governed by regulations in each EU Member State and can differ from one country to another. 35 The aforementioned EU rules are generally applicable in the EEA, which consists of the EU Member States, plus Norway, Liechtenstein and Iceland.
Additionally, the containment of healthcare costs is a priority of federal and state governments, and the prices of drugs have been a focus in this effort. The U.S. government, state legislatures and foreign governments have shown significant interest in implementing cost‑containment programs, including price controls, restrictions on 41 reimbursement and requirements for substitution of generic products.
Additionally, the containment of healthcare costs is a priority of federal and state governments, and the prices of drugs have been a focus in this effort. The U.S. government, state legislatures and foreign governments have shown significant interest in implementing cost‑containment programs, including price controls, restrictions on reimbursement and requirements for substitution of generic products.
The FDA is not bound by the 29 recommendations of an advisory committee, but it considers such recommendations carefully when making decisions. During the FDA review and approval process, the FDA also will determine whether a Risk Evaluation and Mitigation Strategy (“REMS”) is necessary to assure the safe use of the biological product candidate.
The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions. During the FDA review and approval process, the FDA also will determine whether a Risk Evaluation and Mitigation Strategy (“REMS”) is necessary to assure the safe use of the biological product candidate.
On March 30, 2022, CVC filed a notice of appeal in the Broad Interference, and the Broad Institute has cross-appealed. In addition, the PTAB has instituted and completed the motions phase in interferences between the same 14 allowable patent applications in the UC/Vienna/Charpentier portfolio, and certain patent rights owned by ToolGen, Inc.
On March 30, 2022, UC/Vienna/Charpentier filed a notice of appeal in the Broad Interference, and the Broad Institute has cross-appealed. In addition, the PTAB has instituted and completed the motions phase in interferences between the same 14 allowable patent applications in the UC/Vienna/Charpentier portfolio, and certain patent rights owned by ToolGen, Inc.
The BPCIA, however, is complex and only beginning to be interpreted and implemented by the FDA. In addition, proposed legislation has sought to reduce the 12-year reference product exclusivity period. Other aspects of the BPCIA, some of which may impact the BPCIA exclusivity provisions, have also been the subject of recent litigation.
The BPCIA, however, is complex and only beginning to be interpreted and implemented 29 by the FDA. In addition, proposed legislation has sought to reduce the 12-year reference product exclusivity period. Other aspects of the BPCIA, some of which may impact the BPCIA exclusivity provisions, have also been the subject of recent litigation.
We continue to advance our platform’s modular solutions and research efforts on genome editing technologies as well as delivery and cell engineering capabilities to generate additional development candidates. Our mission is to transform the lives of people with severe diseases by developing curative genome editing treatments.
We continue to advance our platform’s modular solutions and research efforts on genome editing technologies as well as delivery and cell engineering capabilities to generate additional development candidates. Our mission is to transform the lives of people with severe diseases by developing potentially curative genome editing treatments.
Our lead in vivo candidates, NTLA-2001 for the treatment of transthyretin (“ATTR”) amyloidosis and NTLA-2002 for the treatment of hereditary angioedema (“HAE”), are the first CRISPR/Cas9-based therapy candidates to be administered systemically, via intravenous infusion, for precision editing of a gene in a target tissue in humans.
Our lead in vivo candidates, NTLA-2001 for the treatment of transthyretin (“ATTR”) amyloidosis and NTLA-2002 for the treatment of hereditary angioedema (“HAE”), are the first CRISPR/Cas9-based therapy candidates to be administered systemically, via intravenous (“IV”) infusion, for precision editing of a gene in a target tissue in humans.
The FDA reviews the application to determine, among other things, whether the proposed product is safe and effective (or, in the case of biologics, to ensure safety, purity and potency), and whether the product is being manufactured in accordance with cGMP, and in certain cases, cGTP, requirements to ensure and preserve the product’s identity, safety, strength, quality, potency and purity.
The FDA reviews the application to determine, among other things, whether the proposed product is safe and effective (or, in the case of biologics, to ensure safety, purity 25 and potency), and whether the product is being manufactured in accordance with cGMP, and in certain cases, cGTP, requirements to ensure and preserve the product’s identity, safety, strength, quality, potency and purity.
These laws impose criminal and civil penalties on violators; 34 • the federal Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), and its implementing regulations, which impose criminal and civil liability for knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program or obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit program, regardless of the payor (e.g., public or private) and knowingly and willfully falsifying, concealing or covering up by any trick or device a material fact or making any materially false statements in connection with the delivery of, or payment for, healthcare benefits, items or services.
These laws impose criminal and civil penalties on violators; 30 • the federal Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), and its implementing regulations, which impose criminal and civil liability for knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program or obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit program, regardless of the payor (e.g., public or private) and knowingly and willfully falsifying, concealing or covering up by any trick or device a material fact or making any materially false statements in connection with the delivery of, or payment for, healthcare benefits, items or services.
Such reforms could have an adverse effect on anticipated revenues from product candidates and may affect our overall financial condition and ability to develop product candidates. 44 Human Capital We believe the success of Intellia’s mission largely depends on our ability to attract and retain highly skilled employees.
Such reforms could have an adverse effect on anticipated revenues from product candidates and may affect our overall financial condition and ability to develop product candidates. Human Capital We believe the success of Intellia’s mission largely depends on our ability to attract and retain highly skilled employees.
We believe we can deliver on our mission and provide long-term benefits for all of our stakeholders by focusing on four key elements: • Develop curative CRISPR/Cas9-based medicines; • Advance our science; • Be the best place to make therapies; and • Focus on long-term sustainability.
We believe we can deliver on our mission and provide long-term benefits for all of our stakeholders by focusing on four key elements: • Develop potentially curative CRISPR/Cas9-based medicines; • Advance our science; • Be the best place to make therapies; and • Focus on long-term sustainability.
We actively apply for, maintain, and plan to defend and enforce, as needed, our internally developed and externally licensed patent rights. Furthermore, we continue to search for and evaluate opportunities to in-license IP relevant to our targeted therapeutic programs and platforms and to develop and acquire new IP in collaboration with third parties.
We actively apply for, maintain, and plan to defend and enforce, as needed, our internally developed and externally licensed patent rights. Furthermore, we continue to search for and evaluate opportunities to in-license IP relevant to our therapeutic programs and platforms and to develop and acquire new IP in collaboration with third parties.
Orphan Designation and Exclusivity Products with an orphan designation in the EU will, upon the grant of a marketing authorization for an orphan product, receive ten years of market exclusivity, during which time no “similar medicinal product” for the same indication may be placed on the market.
Orphan Designation and Exclusivity Products with an orphan designation in the EU will, upon the grant of a marketing authorization for such orphan product, receive ten years of market exclusivity, during which time no “similar medicinal product” for the same indication may be placed on the market.
We believe programs that foster company engagement, diversity, equity and inclusion, growth and development while providing competitive compensation and benefits will attract a diverse population of employees who will bring innovative ideas and creative solutions that will enable the achievement of our goals.
We believe programs that foster company engagement, diversity, equity and inclusion, growth and development while providing competitive compensation and benefits will attract a diverse population of employees who will bring innovative ideas and creative solutions that will enable the achievement of our goals. Company Communications and Engagement .
The 24 competition is likely to come from multiple sources, including large and specialty pharmaceutical and biotechnology companies, academic research institutions, government agencies and public and private research institutions. Many of these competitors may have access to greater capital and resources than us.
The competition is likely to come from multiple sources, including large and specialty pharmaceutical and biotechnology companies, academic research institutions, government agencies and public and private research institutions. Many of these competitors may have access to greater capital and resources than us.
Specifically, under the NIH Guidelines, supervision of human gene transfer trials includes evaluation and assessment by an IBC, a local institutional committee that reviews 27 and oversees research utilizing recombinant or synthetic nucleic acid molecules at that institution.
Specifically, under the NIH Guidelines, supervision of human gene transfer trials includes evaluation and assessment by an IBC, a local institutional committee that reviews and oversees research utilizing recombinant or synthetic nucleic acid molecules at that institution.
Competitors in our efforts to provide genetic therapies to patients can be grouped into at least three sets based on their product discovery platforms: Our platform and product foci are on the development of therapies using CRISPR-based technologies.
Competitors in our efforts to provide other genetic therapies to patients can be grouped into at least three sets based on their product discovery platforms: Our platform and product foci are on the development of therapies using CRISPR-based technologies.
Refer to Note 9 to our consolidated financial statements of this 18 Annual Report on Form 10-K for a detailed description of the terms related to the 2016 Regeneron Agreement and the 2020 Regeneron Amendment. AvenCell Therapeutics, Inc.
Refer to Note 9 to our consolidated financial statements of this Annual Report on Form 10-K for a detailed description of the terms related to the 2016 Regeneron Agreement and the 2020 Regeneron Amendment. AvenCell Therapeutics, Inc.
It is difficult to predict at this time what third-party payors will decide with respect to the coverage and reimbursement for our product candidates. Third‑party and government payors consistently seek to reduce reimbursements for medical products and services.
It is difficult to predict at this time what third party payors will decide with respect to the coverage and reimbursement for our product candidates. 37 Third‑party and government payors consistently seek to reduce reimbursements for medical products and services.
Specifically, we believe we can apply the learnings from our current programs to inform our selection of additional indications and targets of interest. Aggressively Pursuing In Vivo Liver Indications to Develop Therapeutics Rapidly with Our Proprietary Delivery System.
Specifically, we believe we can apply the learnings from our current programs to inform our selection of additional indications and targets of interest. Aggressively Pursuing In Vivo Liver Indications to Develop Therapeutics with Our Proprietary Delivery System.
For example, in March 2010, the ACA was enacted in the U.S. The ACA includes measures that have significantly changed, and are expected to continue to significantly change, the way healthcare is financed by both governmental and private insurers.
For example, in 2010, the ACA was enacted in the U.S. The ACA includes measures that have significantly changed, and are expected to continue to significantly change, the way healthcare is financed by both governmental and private insurers.
The CPRA also creates additional obligations with respect to the processing of personal information, including regulating personal information collected about employees, applicants and retirees as well as that which is collected in a business to 36 business capacity.
The CPRA also creates additional obligations with respect to the processing of personal information, including regulating personal information collected about employees, applicants and retirees as well as that which is collected in a business-to-business capacity.
As a result of the implementation of the GDPR, we may be required to put in place additional mechanisms ensuring compliance with the new data protection rules, including as implemented by individual countries.
As a result of the GDPR, we may be required to put in place additional mechanisms ensuring compliance with the new data protection rules, including as implemented by individual countries.
A “similar medicinal product” is defined as a medicinal product containing a similar active substance or substances as contained in an authorized orphan medicinal product, and which is intended for the same 38 therapeutic indication.
A “similar medicinal product” is defined as a medicinal product containing a similar active substance or substances as contained in an authorized orphan medicinal product, and which is intended for the same therapeutic indication.
The 2016 Regeneron Agreement has two principal components: (i) a product development component under which the parties will research, develop and commercialize CRISPR/Cas-based therapeutic products primarily focused on genome editing in the liver; and (ii) a technology collaboration component, pursuant to which the parties will engage in research and development activities aimed at discovering and developing novel technologies and improvements to CRISPR/Cas technology to enhance our genome editing platform.
The 2016 Regeneron Agreement has two principal components: (i) a product development component under which the parties will research, develop and commercialize CRISPR/Cas-based therapeutic products primarily focused on genome editing in the liver, and (ii) a technology collaboration component, pursuant to which we and Regeneron will engage in research-related activities aimed at discovering and developing novel technologies and improvements to CRISPR/Cas technology to enhance our genome editing platform.
Recent estimates suggest that, globally, between 200,000 and 500,000 people may suffer from ATTRwt with cardiomyopathy (“ATTRwt-CM”). Limitations of Current Treatment Options Currently, there are three therapies for the treatment of ATTRv-PN approved in the United States (“U.S.”), and four approved in most major markets outside of the U.S.
Recent estimates suggest that, globally, between 200,000 and 500,000 people may suffer from ATTRwt with cardiomyopathy (“ATTRwt-CM”). Limitations of Current Treatment Options Currently, there are four therapies for the treatment of ATTRv-PN approved in the United States (“U.S.”), and five approved in most major markets outside of the U.S.
SparingVision will lead and fund the preclinical and clinical development for the genome editing product candidates pursued under the collaboration. We will also be eligible to receive certain research, development and commercial milestone cash payments (up to approximately $200 million per product) as well as royalties on potential future sales of products arising from the collaboration.
SparingVision will lead and fund the preclinical and clinical development for the genome editing product candidates pursued under the collaboration. We will also be eligible to receive certain research, development and commercial milestone cash payments (up to approximately $200.0 million per product) as well as royalties on 16 potential future sales of products arising from the collaboration.
In the event of a successful claim of infringement against us, we may have to pay substantial damages, including treble damages and attorneys’ fees for willful infringement, obtain one or more licenses from third parties, pay royalties or redesign our infringing products, which may not be feasible or require substantial time and monetary expenditure.
In the event of a successful claim of infringement against us, we may have to pay substantial damages, including treble damages and attorneys’ fees for willful infringement, obtain one or more licenses from third parties, pay royalties, delay launch or redesign our infringing products, which may not be feasible or require substantial time and monetary expenditure.
Pioneer Hi-Bred International (DuPont Company) Intellectual Property Pioneer Hi-Bred International and its affiliates, including the DuPont Company, have licensed to Caribou on a worldwide basis, various patent families relating to CRISPR/Cas systems, components and methods of use generally and CRISPR/Cas9 specifically in certain fields, which include Intellia’s field of use under our license agreement with Caribou.
Pioneer Hi-Bred International (DuPont Company) Intellectual Property Pioneer, including the DuPont Company, have licensed to Caribou on a worldwide basis, various patent families relating to CRISPR/Cas systems, components and methods of use generally and CRISPR/Cas9 specifically in certain fields, which include Intellia’s field of use under our license agreement with Caribou.
Key obligations include expedited reporting of suspected serious adverse reactions and submission of periodic safety update reports (“PSUR”s). All new MAAs must include a risk management plan (“RMP”), describing the risk management system that the company will put in place and documenting measures to prevent or minimize the risks associated with the product.
Key obligations include expedited reporting of suspected serious adverse reactions and submission of periodic safety update reports (“PSURs”). All new MAAs must include a risk management plan (“RMP”), describing the risk management system that the company will put in place and documenting measures to prevent or minimize the risks associated with the product.
Marketing Authorization In the EU, medicinal products, including advanced therapy medicinal products (“ATMP”s), are subject to extensive pre- and post-market regulation by regulatory authorities at both the EU and national levels. ATMPs comprise gene therapy products, somatic cell therapy products and tissue engineered products. We anticipate that our gene therapy development products would be regulated as ATMPs in the EU.
Marketing Authorization In the EU, medicinal products, including advanced therapy medicinal products (“ATMPs”), are subject to extensive pre- and post-market regulation by regulatory authorities at both the EU and national levels. ATMPs comprise gene therapy products, somatic cell therapy products and tissue engineered products. We anticipate that our gene therapy development products would be regulated as ATMPs in the EU.
NTLA-2001 is the subject of a co-development and co-promotion (“Co/Co”) agreement directed to our first collaboration target with Regeneron, ATTR (the “ATTR Co/Co”), for which we are the clinical and commercial lead party and Regeneron is the participating party. Regeneron shares in approximately 25% of worldwide development costs and commercial profits for the ATTR program.
NTLA-2001 is the subject of a co-development and co-promotion (“Co/Co”) arrangement directed to our first collaboration target with Regeneron, ATTR (the “ATTR Co/Co”), for which we are the clinical and commercial lead party and Regeneron is the participating party. Regeneron shares in approximately 25% of worldwide development costs and commercial profits for the ATTR program.
Under the Rewrite Merger Agreement, we agreed to pay Rewrite’s former stockholders and optionholders (the “Rewrite Holders”) (a) upfront consideration in an aggregate amount of approximately $45.0 million payable in cash, excluding customary purchase price adjustments, and (b) up to an additional $155.0 million in milestone payments, including $55.0 million upon the achievement of certain pre-specified research milestones and $100.0 million upon achievement of a certain regulatory approval milestone, payable through a mixture of $130.0 million in cash and $25.0 million in shares of common stock.
Under the Rewrite Merger Agreement, we agreed to pay Rewrite’s former stockholders and option holders (the “Rewrite Holders”) (a) upfront consideration in an aggregate amount of approximately $45.0 million payable in cash, excluding customary purchase price adjustments, and (b) up to an additional $155.0 million in milestone payments, including $55.0 million upon the achievement of certain pre-specified research milestones and $100.0 million upon achievement of a certain regulatory approval milestone, payable through a mixture of $130.0 million in cash and $25.0 million in shares of common stock.
Data Protection Act 2018 set out the U.K.’s data protection regime, which is independent from but aligned to the EU’s data protection regime. Non-compliance with the U.K. GDPR may result in monetary penalties of up to £17.5 million or 4% of worldwide revenue, whichever is higher.
Data Protection Act 2018 set out the U.K.’s data protection regime, which is independent from but currently still aligned to the EU’s data protection regime. Non-compliance with the U.K. GDPR may result in monetary penalties of up to £17.5 million or 4% of worldwide revenue, whichever is higher.
Regulation in the European Union Clinical Trial Approval In April 2014, the EU adopted the new Clinical Trials Regulation, (EU) No 536/2014, which replaced the current Clinical Trials Directive 2001/20/EC on 31 January 2022. The Clinical Trials Regulation is directly applicable in all EU Member States meaning no national implementing legislation in each EU Member State is required.
Regulation in the European Union Clinical Trial Approval In April 2014, the EU adopted the new Clinical Trials Regulation, (EU) No 536/2014, which replaced the previous Clinical Trials Directive 2001/20/EC on 31 January 2022. The Clinical Trials Regulation is directly applicable in all EU Member States meaning no national implementing legislation in each EU Member State is required.
This process generally involves the following: • completion of extensive nonclinical, sometimes referred to as preclinical laboratory tests, and preclinical animal studies and formulation studies in accordance with applicable regulations, including good laboratory practice (“GLP”) and applicable requirements for the humane use of laboratory animals; • submission to the FDA of an IND application, which must become effective before human clinical trials may begin; • performance of adequate and well-controlled human clinical trials, according to the FDA’s regulations commonly referred to as good clinical practice (“GCP”) and any additional requirements for the protection of human research subjects and their health information, to establish the safety and efficacy of the proposed product for its intended use; • submission to the FDA of a BLA for marketing approval that includes substantial evidence of safety, efficacy, and purity and potency, from nonclinical and in vitro testing and clinical trials; 26 • satisfactory completion of an FDA inspection of the manufacturing facility or facilities where the product is produced to assess compliance with current good manufacturing practice (“cGMP”) 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 (“cGTP”) requirements for the use of human cellular and tissue products; • positive results from potential FDA audit of the nonclinical study and clinical trial sites that generated the data in support of the BLA; • review of the proposed product by an FDA advisory committee, where appropriate and if applicable; • payment of user fees for FDA review of the BLA (unless a fee waiver applies); and • FDA review and approval, or licensure, of the BLA.
This process generally involves the following: • completion of extensive nonclinical, sometimes referred to as preclinical laboratory tests, and preclinical animal studies and formulation studies in accordance with applicable regulations, including good laboratory practice (“GLP”) and applicable requirements for the humane use of laboratory animals; 22 • submission to the FDA of an IND application, which must become effective before human clinical trials may begin; • performance of adequate and well-controlled human clinical trials, according to the FDA’s regulations commonly referred to as good clinical practice (“GCP”) and any additional requirements for the protection of human research subjects and their health information, to establish the safety and efficacy of the proposed product for its intended use; • submission to the FDA of a BLA for marketing approval that includes substantial evidence of safety, efficacy, and purity and potency, from nonclinical and in vitro testing and clinical trials; • satisfactory completion of an FDA inspection of the manufacturing facility or facilities where the product is produced to assess compliance with current good manufacturing practice (“cGMP”) 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 (“cGTP”) requirements for the use of human cellular and tissue products; • positive results from potential FDA audit of the nonclinical study and clinical trial sites that generated the data in support of the BLA; • review of the proposed product by an FDA advisory committee, where appropriate and if applicable; • payment of user fees for FDA review of the BLA (unless a fee waiver applies, such as for product candidates designated as orphan drugs); and • FDA review and approval, or licensure, of the BLA.
The FDA typically advises that sponsors observe subjects for potential gene therapy-related delayed adverse events for up to a 15-year period, including a minimum of five years of annual examinations followed by ten years of annual queries, either in person or by questionnaire.
The FDA typically advises that sponsors observe subjects for potential gene therapy-related delayed adverse events for up to a 15-year period after administration, including a minimum of five years of annual examinations followed by ten years of annual queries, either in person or by questionnaire.
In parallel, we are advancing multiple ex vivo programs, wholly owned and in collaboration with partners, for the treatment of immuno-oncology and autoimmune diseases. CRISPR/Cas9 Technology The Nobel Prize-winning CRISPR/Cas9 system developed by one of our scientific co-founders, Dr.
In addition, we are advancing multiple ex vivo programs, wholly owned and in collaboration with partners, for the treatment of immuno-oncology and autoimmune diseases. CRISPR/Cas9 Technology The Nobel Prize-winning CRISPR/Cas9 system developed by one of our scientific co-founders, Dr.
As of December 31, 2022, this family includes over 50 issued patents in the U.S. and over 30 granted patents outside the U.S., including for example the U.K., Australia, China, Japan, Israel, Mexico and the approximately 40 countries that are members of the European Patent Convention.
As of December 31, 2023, this family includes over 50 issued patents in the U.S. and over 30 granted patents outside the U.S., including for example the U.K., Australia, China, Japan, Israel, Mexico and the approximately 40 countries that are members of the European Patent Convention.
GDPR grants individuals the opportunity to object to the processing of their personal information, allows them to request deletion of personal information in certain circumstances, and provides the individual with an express right to seek legal remedies in the event the individual believes his or her rights have been violated.
The GDPR grants individuals the opportunity to object to the processing of their personal data, allows them to request deletion of personal data in certain circumstances, and provides the individual with an express right to seek legal remedies in the event the individual believes his or her rights have been violated.
Pursuant to Regulation (EC) No. 726/2004, the centralized procedure is compulsory for specific products, including for medicines produced by certain biotechnological processes, products designated as orphan medicinal products, ATMPs, and products with 37 a new active substance indicated for the treatment of certain diseases, including products for the treatment of cancer, HIV or AIDS, diabetes, neurodegenerative disorders, auto-immune and other immune dysfunctions and viral diseases.
Pursuant to Regulation (EC) No. 726/2004, the centralized procedure is compulsory for specific products, including for medicines produced by certain biotechnological processes, products designated as orphan medicinal products, ATMPs, and products with a new active substance indicated for the treatment of certain diseases, including products for the treatment of cancer, HIV or AIDS, diabetes, neurodegenerative disorders, autoimmune and other immune dysfunctions and viral diseases.
The TCA includes specific provisions concerning pharmaceuticals, which include the mutual recognition of GMP, inspections of manufacturing facilities for medicinal products and GMP documents issued, but does not foresee wholesale mutual recognition of U.K. and EU pharmaceutical regulations.
The TCA includes specific provisions concerning pharmaceuticals, which include the mutual recognition of GMP, inspections of manufacturing facilities for medicinal products and GMP documents issued, but does not provide for wholesale mutual recognition of U.K. and EU pharmaceutical regulations.
On August 26, 2019, the PTAB redeclared the interference to include additional UC/Vienna/Charpentier patent applications covering the invention that had also been found allowable by the USPTO. As of December 31, 2020, the interference involved 14 allowable patent applications from the UC/Vienna/Charpentier eukaryotic patent family and 13 patents and one patent application from the Broad Institute patent family.
On August 26, 2019, the PTAB redeclared the interference to include additional UC/Vienna/Charpentier patent applications covering the invention that had also been found allowable by the USPTO. As of December 31, 2023, the interference involved 14 allowable patent applications from the UC/Vienna/Charpentier eukaryotic patent family and 13 patents and one patent application from the Broad Institute 19 patent family.
Specific to our NTLA-2002 program, we are aware of other companies that are currently commercializing or developing products used to treat HAE including Takeda Pharmaceutical Company Limited, Astria Therapeutics Inc., ADARx Therapeutics, Inc., BioCryst Pharmaceuticals Inc., BioMarin Pharmaceutical Inc., Pharming Group N.V., and CSL Limited.
Specific to our NTLA-2002 program, we are aware of other companies that are currently commercializing or developing products used to treat HAE including ADARx Therapeutics, Inc., Astria Therapeutics Inc., BioCryst Pharmaceuticals Inc., BioMarin Pharmaceutical Inc., CSL Limited, Ionis Pharmaceuticals, Inc., KalVista Pharmaceuticals, Inc., Pharming Group N.V., Pharvaris N.V. and Takeda Pharmaceutical Company Limited.
The new Clinical Trials Regulation aims to simplify and streamline the approval of clinical trials in the EU.
The Clinical Trials Regulation aims to simplify and streamline the approval of clinical trials in the EU.
In the event we decide to conduct clinical trials or enroll subjects in our future clinical trials, we may be subject to additional privacy restrictions. As of May 25, 2018, the General Data Protection Regulation (“GDPR”) regulates the collection, use, storage, disclosure, transfer or other processing of personal data, including personal health data, in the EU.
In the event we decide to conduct clinical trials or enroll subjects in our future clinical trials, we may be subject to additional privacy restrictions. In the EU, the General Data Protection Regulation (“GDPR”) regulates the collection, use, storage, disclosure, transfer or other processing of personal data, including personal health data.
The applicant will receive a fee reduction for the MAA if the orphan drug designation has been granted, but not if the designation is still pending at the time the marketing authorization is submitted. Orphan designation does not convey any advantage in, or shorten the duration of, the regulatory review and approval process.
The applicant 34 will receive a fee reduction for the MAA if the orphan drug designation has been granted, but not if the designation is still pending at the time the MAA is submitted. Orphan designation does not convey any advantage in, or shorten the duration of, the regulatory review and approval process.
SparingVision SAS (“SparingVision”) In October 2021, we and SparingVision, a genomic medicine company developing vision saving treatments for ocular diseases, entered into a license and collaboration agreement (the “SparingVision LCA”), to develop novel genomic medicines utilizing CRISPR/Cas9 technology for the treatment of ocular diseases.
SparingVision SAS (“SparingVision”) In October 2021, we entered into a license and collaboration agreement with SparingVision, a genomic medicine company developing vision saving treatments for ocular diseases, to develop novel genomic medicines utilizing CRISPR/Cas9 technology for the treatment of ocular diseases.
Item 1. Business Overview We are a leading clinical-stage genome editing company, focused on developing potentially curative therapeutics using CRISPR/Cas9-based technologies.
Item 1. Business Overview We are a leading clinical-stage gene editing company, focused on developing potentially curative therapeutics using CRISPR/Cas9-based technologies.
For those products for which the use of the centralized procedure is not mandatory, applicants may elect to use the centralized procedure where either the product contains a new active substance indicated for the treatment of other diseases, or where the applicant can show that the product constitutes a significant therapeutic, scientific or technical innovation or for which a centralized process is in the interest of patients at an EU level.
For those products for which the use of the centralized procedure is not mandatory, applicants may elect to use the centralized procedure where either the product contains a new active substance indicated for the treatment of diseases other than those listed above, or where the applicant can show that the product constitutes a significant therapeutic, scientific or technical innovation or for which the centralized procedure is in the interest of patients at an EU level.
(“Kyverna”), a cell therapy company engineering a new class of therapies for autoimmune and inflammatory diseases; and ONK Therapeutics, Ltd. (“ONK”), a cell therapy company engineering a new class of NK cell therapies to treat cancer, exemplify this strategy. 7 Growing Our Leadership Position in the Field of Genome Editing.
(“Kyverna”), a cell therapy company engineering a new class of therapies for autoimmune and inflammatory diseases; and ONK Therapeutics, Ltd. (“ONK”), a cell therapy company engineering a new class of NK cell therapies to treat cancer. 7 Growing Our Leadership Position in the Field of Genome Editing.
Prior to initiating clinical trials in foreign countries, clinical trial applications (“CTAs”) or other equivalent applications, similar to IND applications, must be approved. Biologic products must be approved by the FDA before they may be legally marketed in the U.S. and by the appropriate foreign regulatory agencies before they may be legally marketed in foreign countries.
Prior to initiating clinical trials in foreign countries, CTAs or other equivalent applications, similar to IND applications, must be approved. Biologic products must be approved by the FDA before they may be legally marketed in the U.S. and by the appropriate foreign regulatory agencies before they may be legally marketed in foreign countries.
The manufacturing of authorized medicinal products, for which a separate manufacturer’s license is mandatory, must also be conducted in strict compliance with the applicable EU laws, regulations and guidance, including Directive 2001/83/EC, Directive 2003/94/EC, Regulation (EC) No 726/2004 and the European Commission Guidelines for Good Manufacturing Practice.
The manufacturing of authorized medicinal products, for which a separate manufacturer’s license is mandatory, must also be conducted in strict compliance with the applicable EU laws, regulations and guidance, including Directive 2001/83/EC, Directive 2017/1572, Regulation (EC) No 726/2004 and the European Commission Guidelines for Good Manufacturing Practice.
Alpha-1 antitrypsin ( “ A1AT ” ), which is encoded by the SERPINA1 gene, is a serine protease inhibitor that is primarily produced in the liver and has a wide range of biological functions, one of which is to inhibit neutrophil elastase.
Alpha-1 antitrypsin (“A1AT”), which is encoded by the SERPINA1 gene, is a serine protease inhibitor that is primarily produced in the liver and has a wide range of biological functions, one of which is to inhibit neutrophil elastase.
To obtain regulatory approval of a medicinal product in the EU, we must submit a marketing authorization application (“MAA”). The centralized procedure provides for the grant of a single marketing authorization by the EC that is valid throughout the EU, and in the additional member states of the EEA (Iceland, Norway and Liechtenstein).
To obtain regulatory approval of our medicinal products in the EU, we must submit a marketing authorization application (“MAA”) to the EMA. The centralized procedure provides for the grant of a single marketing authorization by the EC that is valid throughout the EU, and in the additional member states of the EEA (Iceland, Norway and Liechtenstein).
(“Regeneron”), a leader in genetics-driven drug discovery and development, and our collaborations with AvenCell Therapeutics, Inc. (“AvenCell”), a newly formed corporation with a world-leading clinical-stage universal chimeric antigen receptor T (“CAR-T”) cell platform; SparingVision SAS (“SparingVision”), a genomic medicine company developing vision saving treatments for ocular diseases; Kyverna Therapeutics, Inc.
(“Regeneron”), a leader in genetics-driven drug discovery and development, and to advance our collaborations with AvenCell Therapeutics, Inc. (“AvenCell”), a company with a world-leading clinical-stage universal chimeric antigen receptor T (“CAR-T”) cell platform; SparingVision SAS (“SparingVision”), a genomic medicine company developing vision saving treatments for ocular diseases; Kyverna Therapeutics, Inc.
At present, Great Britain has implemented EU legislation on the marketing, promotion and sale of medicinal products through the Human Medicines Regulations 2012 (as amended) (under the Northern Ireland Protocol, the EU regulatory framework will continue to apply in Northern Ireland).
At present, Great Britain has implemented EU legislation on the marketing, promotion and sale of medicinal products through the Human Medicines Regulations 2012 (as amended) (under the Northern Ireland Protocol, the EU regulatory framework currently continues to apply in Northern Ireland).
Written IND safety reports must be promptly submitted to the FDA and the investigators for serious and unexpected adverse events, any findings from other trials, tests in laboratory animals or in vitro testing that suggest a significant risk for human subjects, or any clinically important increase in the rate of a serious suspected adverse reaction over that listed in the protocol or investigator brochure.
Written IND safety reports must be promptly submitted to the FDA and the investigators for serious and unexpected adverse events that are associated with the use of the product candidate, any findings from other trials, tests in laboratory animals or in vitro testing that suggest a significant risk for human subjects, or any clinically important increase in the rate of a serious suspected adverse reaction over that listed in the protocol or investigator brochure.
The potential application of the CRISPR/Cas9 system and derivative technologies is extremely broad, and we plan to continue to identify partners who can contribute meaningful resources and technical expertise to our programs and allow us to more rapidly bring scientific innovation to a broader patient population. Our ongoing partnership on in vivo programs for genetic diseases with Regeneron Pharmaceuticals, Inc.
The potential application of the CRISPR/Cas9 system and derivative technologies is extremely broad, and we plan to continue to identify partners who can contribute meaningful resources and technical expertise to our programs and allow us to more rapidly bring scientific innovation to a broader patient population. For example, we continue to collaborate on in vivo programs with Regeneron Pharmaceuticals, Inc.
Specific to our NTLA-2001 program, we are aware of other companies that are currently commercializing or developing products and therapies used to treat TTR amyloidosis, including Pfizer, Inc., Alnylam Pharmaceuticals, Inc., AstraZeneca Pharmaceuticals LP, Ionis Pharmaceuticals, Inc., BridgeBio Pharma Inc. and Novo Nordisk A/S.
Specific to our NTLA-2001 program, we are aware of other companies that are currently commercializing or developing products and therapies used to treat ATTR amyloidosis, including Alnylam Pharmaceuticals, Inc., AstraZeneca Pharmaceuticals LP, BridgeBio Pharma Inc., Ionis Pharmaceuticals, Inc., Metagenomi Technologies, LLC, Novo Nordisk A/S and Pfizer, Inc.
At present, there is only one therapy approved for ATTR-CM (including both ATTRv-CM and ATTRwt-CM) which has shown the ability to improve patient outcomes, though most patients still appear to have the progressive disease. As with the treatments for ATTRv-PN, chronic, lifetime dosing is required to sustain the therapeutic effects.
At present, there is only one therapy approved for transthyretin amyloidosis with cardiomyopathy (“ATTR-CM”) (including both ATTRv-CM and ATTRwt-CM) which has shown the ability to improve patient outcomes, though most patients still appear to have the progressive disease. As with the treatments for ATTRv-PN, chronic, lifetime dosing is required to sustain the therapeutic effects.
In September 2022, Rewrite merged into Intellia, with Intellia as the surviving entity. In January 2023, a $25.0 million research milestone was achieved and, in February 2023, we paid the Rewrite Holders a mixture of cash and 567,045 shares of common stock in order to fulfill this obligation. Novartis Institutes for BioMedical Research, Inc.
In September 2022, Rewrite merged into Intellia, with Intellia as the surviving entity. In January 2023, a $25.0 million research milestone was achieved and, in February 2023, we paid the Rewrite Holders a mixture of cash and 567,045 shares of common stock in order to fulfill this obligation. ReCode Therapeutics, Inc.
Genome editing companies focused on CRISPR-based technologies include: Beam Therapeutics Inc., Caribou Biosciences, Inc., CRISPR Therapeutics AG, Editas Medicine, Inc., Verve Therapeutics Inc. and ToolGen, Inc.
Genome editing companies focused on CRISPR-based technologies include: Beam Therapeutics Inc., Caribou Biosciences, Inc., CRISPR Therapeutics AG, Editas Medicine, Inc., Metagenomi Technologies, LLC, Prime Medicine, Inc., ToolGen, Inc. and Verve Therapeutics Inc.

… 285 more changes not shown on this page.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

232 edited+72 added−59 removed375 unchanged
Biggest changeOur ability to generate revenue, and achieve and retain profitability, depends significantly on our success in many areas, including: • selecting commercially viable product candidates and effective delivery methods; • successfully completing research, preclinical and clinical development of product candidates; • obtaining regulatory approvals and marketing authorizations for product; • developing a sustainable and scalable manufacturing process for product candidates, including establishing and maintaining commercially viable supply relationships with third parties, such as CMOs, and potentially establishing our own manufacturing capabilities and infrastructure; • investing significant resources in developing large scale manufacturing and operational infrastructure prior to clinical evidence of safety and efficacy for a given product candidate; • launching and commercializing product candidates for which we obtain regulatory approvals and marketing authorizations, either directly or with a collaborator or distributor; • accurately assessing the size and addressability of potential patient populations; • obtaining market acceptance of our product candidates as viable treatment options; • addressing any competing technological and market developments; • negotiating favorable terms in any collaboration, licensing or other arrangements into which we may enter or which may be necessary for us to develop, manufacture or commercialize our product candidates; • maintaining good relationships with our collaborators and licensors; • maintaining, protecting and expanding our portfolio of intellectual property rights, including patents, trade secrets and know-how; • avoiding infringement of or obtaining licenses to any valid intellectual property owned or controlled by third parties; and • attracting, hiring and retaining qualified personnel.
Biggest changeOur ability to generate revenue, and achieve and retain profitability, depends significantly on our success in many areas, including: • obtaining regulatory approvals and marketing authorizations for our lead programs; • obtaining market acceptance of our product candidates as viable treatment options; • launching and commercializing product candidates for which we obtain regulatory approvals and marketing authorizations, either directly or with a collaborator or distributor; • accurately assessing the size and addressability of potential patient populations; • addressing any competing technological and market developments; • maintaining, protecting and expanding our portfolio of intellectual property rights, including patents, trade secrets and know-how; • avoiding infringement of or obtaining licenses to any valid intellectual property owned or controlled by third parties; • negotiating favorable terms in any collaboration, licensing or other arrangements into which we may enter or which may be necessary for us to develop, manufacture or commercialize our product candidates; • maintaining good relationships with our collaborators and licensors; • attracting, hiring and retaining qualified personnel; • developing a sustainable and scalable manufacturing process for product candidates, including establishing and maintaining commercially viable supply relationships with third parties, such as CMOs, and potentially establishing our own manufacturing capabilities and infrastructure; • successfully completing research, preclinical and clinical development of product candidates; 59 • investing resources in developing commercial manufacturing and operational infrastructure prior to clinical evidence of safety and efficacy for a given product candidate; and • selecting commercially viable product candidates and effective delivery methods.
Moreover, data subjects can seek damages for violations, and non-profit organizations can bring claims on behalf of data subjects. The costs associated with ensuring compliance with these laws, including in particular European Data Protection Law, may be onerous and adversely affect our business, financial condition, results of operations and prospects.
Moreover, data subjects can seek damages for violations, and non-profit organizations can bring claims on behalf of data subjects. The costs associated with ensuring compliance with these laws, including in particular European Data Protection Law, may be onerous and may adversely affect our business, financial condition, results of operations and prospects.
Leonard, M.D., our President and Chief Executive Officer, Glenn Goddard, our Executive Vice President, Chief Financial Officer and Treasurer, David Lebwohl, our Executive Vice President and Chief Medical Officer, James Basta, our Executive Vice President, General Counsel and Corporate Secretary, Laura Sepp-Lorenzino, our Executive Vice President and Chief Scientific Officer, Eliana Clark, our Executive Vice President and Chief Technical Officer and Derek Hicks, our Executive Vice President and Chief Business Officer, as well as the other principal members of our management, scientific and clinical teams.
Leonard, M.D., our President and Chief Executive Officer, James Basta, our Executive Vice President, General Counsel and Corporate Secretary, Eliana Clark, our Executive Vice President and Chief Technical Officer, Glenn Goddard, our Executive Vice President, Chief Financial Officer and Treasurer, Derek Hicks, our Executive Vice President and Chief Business Officer, David Lebwohl, our Executive Vice President and Chief Medical Officer, and Laura Sepp-Lorenzino, our Executive Vice President and Chief Scientific Officer, as well as the other principal members of our management, scientific and clinical teams.
Our stock price is likely to continue to be volatile and subject to significant price and volume fluctuations in response to market and other factors, including: • the success of our products or technologies or competing products or technologies; • results of clinical trials of our product candidates or those of our competitors; • developments or disputes concerning issued patents, patent applications or other intellectual property rights; • regulatory or legal developments in the U.S. and other countries; • the recruitment or departure of key personnel; • the level of expenses related to any of our product candidates or clinical development programs; • the results of our efforts to discover, develop, manufacture, acquire or in-license our current and additional product candidates or products; • actual or anticipated changes in estimates as to financial results, development timelines or recommendations by securities analysts; • variations in our financial results or the financial results of companies that are perceived to be similar to us; • sales of a substantial number of shares of our common stock in the public market, or the perception in the market that the holders of a large number of shares intend to sell shares; • changes in the structure of healthcare payment systems; • market conditions in the pharmaceutical and biotechnology sectors; • public perception of the safety of genome editing based therapeutics; • general economic, industry and market conditions; and • the other factors summarized and described in this Risk Factors section.
Our stock price is likely to continue to be volatile and subject to significant price and volume fluctuations in response to market and other factors, including: • the success of our products or technologies or competing products or technologies; • results of clinical trials of our product candidates or those of our competitors; • developments or disputes concerning issued patents, patent applications or other intellectual property rights; • regulatory or legal developments in the U.S. and other countries; • the recruitment or departure of key personnel; • the level of expenses related to any of our product candidates or clinical development programs; • the results of our efforts to discover, develop, manufacture, acquire or in-license our current and additional product candidates or products; • actual or anticipated changes in estimates as to financial results, development timelines or recommendations by securities analysts; • variations in our financial results or the financial results of companies that are perceived to be similar to us; • sales of a substantial number of shares of our common stock in the public market, or the perception in the market that the holders of a large number of shares intend to sell shares; • changes in the structure of healthcare payment systems; 83 • market conditions in the pharmaceutical and biotechnology sectors; • public perception of the safety of genome editing based therapeutics; • general economic, industry and market conditions; and • the other factors summarized and described in this Risk Factors section.
Disputes have and may arise between us and our licensors, our licensors and their licensors, or us and third parties that co-own intellectual property with our licensors or their licensors, regarding intellectual property subject to a license agreement, including those relating to: • the scope of rights, if any, granted under the license agreement and other interpretation-related issues; • whether and the extent to which our technology, products and processes infringe on, or derive from, intellectual property of the licensor that is not subject to the license agreement; • whether our licensor or its licensor had the right to grant the license agreement, or whether they are compliant with their contractual obligations to their respective licensor(s); • whether third parties are entitled to compensation or equitable relief, such as an injunction, for our use of the intellectual property without their authorization; • our right to sublicense patent and other rights to third parties, including those under collaborative development relationships; 79 • whether we are complying with our obligations with respect to the use of the licensed technology in relation to our development and commercialization of product candidates; • our involvement in the prosecution, defense and enforcement of the licensed patents and our licensors’ overall patent strategy; • the allocation of ownership of inventions and know-how resulting from the joint creation or use of intellectual property by our licensors and by us and our partners; and • the amounts of royalties, milestones or other payments due under the license agreement.
Disputes have and may arise between us and our licensors, our licensors and their licensors, or us and third parties that co-own intellectual property with our licensors or their licensors, regarding intellectual property subject to a license agreement, including those relating to: • the scope of rights, if any, granted under the license agreement and other interpretation-related issues; • whether and the extent to which our technology, products and processes infringe on, or derive from, intellectual property of the licensor that is not subject to the license agreement; • whether our licensor or its licensor had the right to grant the license agreement, or whether they are compliant with their contractual obligations to their respective licensor(s); • whether third parties are entitled to compensation or equitable relief, such as an injunction, for our use of the intellectual property without their authorization; • our right to sublicense patent and other rights to third parties, including those under collaborative development relationships; • whether we are complying with our obligations with respect to the use of the licensed technology in relation to our development and commercialization of product candidates; • our involvement in the prosecution, defense and enforcement of the licensed patents and our licensors’ overall patent strategy; • the allocation of ownership of inventions and know-how resulting from the joint creation or use of intellectual property by our licensors and by us and our partners; and • the amounts of royalties, milestones or other payments due under the license agreement.
Among other things, the certificate of incorporation and by-laws: • permit the board of directors to issue up to 5,000,000 shares of preferred stock, with any rights, preferences and privileges as they may designate; • provide that the authorized number of directors may be changed only by resolution of the board of directors; • provide that all vacancies, including newly created directorships, may, except as otherwise required by law, be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum; • divide the board of directors into three classes; • provide that a director may only be removed from the board of directors by the stockholders for cause; • require that any action to be taken by our stockholders must be effected at a duly called annual or special meeting of stockholders, and may not be taken by written consent; • provide that stockholders seeking to present proposals before a meeting of stockholders or to nominate candidates for election as directors at a meeting of stockholders must provide notice in writing in a timely manner, and meet specific requirements as to the form and content of a stockholder’s notice; • prevent cumulative voting rights (therefore allowing the holders of a plurality of the shares of common stock entitled to vote in any election of directors to elect all of the directors standing for election, if they should so choose); • require that, to the fullest extent permitted by law, a stockholder reimburse us for all fees, costs and expenses incurred by us in connection with a proceeding initiated by such stockholder in which such stockholder does not obtain a judgment on the merits that substantially achieves the full remedy sought; 90 • provide that special meetings of our stockholders may be called only by the chairman of the board, our chief executive officer (or president, in the absence of a chief executive officer) or by the board of directors; and • provide that stockholders will be permitted to amend the bylaws only upon receiving at least two-thirds of the total votes entitled to be cast by holders of all outstanding shares then entitled to vote generally in the election of directors, voting together as a single class.
Among other things, the certificate of incorporation and by-laws: • permit the board of directors to issue up to 5,000,000 shares of preferred stock, with any rights, preferences and privileges as they may designate; • provide that the authorized number of directors may be changed only by resolution of the board of directors; • provide that all vacancies, including newly created directorships, may, except as otherwise required by law, be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum; • divide the board of directors into three classes; • provide that a director may only be removed from the board of directors by the stockholders for cause; 86 • require that any action to be taken by our stockholders must be effected at a duly called annual or special meeting of stockholders, and may not be taken by written consent; • provide that stockholders seeking to present proposals before a meeting of stockholders or to nominate candidates for election as directors at a meeting of stockholders must provide notice in writing in a timely manner, and meet specific requirements as to the form and content of a stockholder’s notice; • prevent cumulative voting rights (therefore allowing the holders of a plurality of the shares of common stock entitled to vote in any election of directors to elect all of the directors standing for election, if they should so choose); • require that, to the fullest extent permitted by law, a stockholder reimburse us for all fees, costs and expenses incurred by us in connection with a proceeding initiated by such stockholder in which such stockholder does not obtain a judgment on the merits that substantially achieves the full remedy sought; • provide that special meetings of our stockholders may be called only by the chairman of the board, our chief executive officer (or president, in the absence of a chief executive officer) or by the board of directors; and • provide that stockholders will be permitted to amend the bylaws only upon receiving at least two-thirds of the total votes entitled to be cast by holders of all outstanding shares then entitled to vote generally in the election of directors, voting together as a single class.
However, we cannot predict: • if and when any patents will issue; • the scope, degree and range of protection any issued patents will afford us against competitors, including whether third parties will find ways to invalidate or otherwise circumvent our patents; 81 • whether others will apply for or obtain patents claiming aspects similar to those covered by our patents and patent applications; • whether certain governments will appropriate our intellectual property rights and allow competitors to use them; or • whether we will need to initiate litigation or administrative proceedings to assert or defend our patent rights, which may be costly whether we win or lose.
However, we cannot predict: • if and when any patents will issue; • the scope, degree and range of protection any issued patents will afford us against competitors, including whether third parties will find ways to invalidate or otherwise circumvent our patents; • whether others will apply for or obtain patents claiming aspects similar to those covered by our patents and patent applications; • whether certain governments will appropriate our intellectual property rights and allow competitors to use them; or • whether we will need to initiate litigation or administrative proceedings to assert or defend our patent rights, which may be costly whether we win or lose.
A variety of factors will influence whether our product candidates are accepted in the market, including, for example: • the clinical indications for which our product candidates are approved; • the potential and perceived advantages of our product candidates over alternative treatments; • the incidence and severity of any side effects, including any unintended deoxyribonucleic acid (“DNA”) changes; • product labeling or product insert requirements of the FDA or other regulatory authorities; • limitations or warnings contained in the labeling approved by the FDA or other regulatory authorities; • the timing of market introduction of our product candidates; • availability or existence of competitive products; • the cost of treatment in relation to alternative treatments; 54 • the amount of upfront costs or training required for healthcare providers to administer our product candidates; • the availability of adequate coverage, reimbursement and pricing by government authorities and other third-party payors; • patients’ ability to access healthcare providers capable of delivering our product candidates; • patients’ willingness and ability to pay out-of-pocket in the absence of coverage and reimbursement by government authorities and other third-party payors; • the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies; • relative convenience and ease of administration, including as compared to alternative treatments and competitive therapies; • any restrictions on the use of our product candidates together with other medications; • interactions of our product candidates with other medicines patients are taking; • potential adverse events for any products developed, or negative interactions with regulatory agencies, by us or others in the gene therapy and genome editing fields; and • the effectiveness of our sales and marketing efforts and distribution support.
A variety of factors will influence whether our product candidates are accepted in the market, including, for example: • the clinical indications for which our product candidates are approved; • the potential and perceived advantages of our product candidates over alternative treatments; • the incidence and severity of any side effects, including any unintended deoxyribonucleic acid (“DNA”) changes; • product labeling or product insert requirements of the FDA or other regulatory authorities; • limitations or warnings contained in the labeling approved by the FDA or other regulatory authorities; • the timing of market introduction of our product candidates; • availability or existence of competitive products; • the cost of treatment in relation to alternative treatments; • the amount of upfront costs or training required for healthcare providers to administer our product candidates; • the availability of adequate coverage, reimbursement and pricing by government authorities and other third party payors; 48 • patients’ ability to access healthcare providers capable of delivering our product candidates; • patients’ willingness and ability to pay out-of-pocket in the absence of coverage and reimbursement by government authorities and other third party payors; • the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies; • relative convenience and ease of administration, including as compared to alternative treatments and competitive therapies; • any restrictions on the use of our product candidates together with other medications; • interactions of our product candidates with other medicines patients are taking; • potential adverse events for any products developed, or negative interactions with regulatory agencies, by us or others in the gene therapy and genome editing fields; and • the effectiveness of our sales and marketing efforts and distribution support.
Our existing and future therapeutic collaborations may have a number of risks, including that collaborators: • have significant discretion in determining the efforts and resources that they will apply; • may not perform their obligations as expected; • may dispute the amounts of payments owed; • may not pursue development and commercialization of any product candidates that achieve regulatory approval or may elect not to continue or renew development or commercialization programs or license 65 arrangements based on clinical trial results, changes in their strategic focus or available funding, or external factors, such as a strategic transaction that may divert resources or create competing priorities; • may delay, insufficiently fund, stop, initiate new or repeat clinical trials, reformulate a product candidate for clinical testing, or abandon a product candidate; • could develop independently, or with third parties, products that compete directly or indirectly with our products and product candidates; • may view product candidates discovered in our collaborations as competitive with their own product candidates or products, which may cause collaborators to cease to devote resources to the development or commercialization of our product candidates; • may dispute ownership or rights in jointly developed technologies or intellectual property; • may fail to comply with applicable legal and regulatory requirements regarding the development, manufacture, sale, distribution or marketing of a product candidate or product; • with sales, marketing, manufacturing and distribution rights to our product candidates may not commit sufficient resources to the product’s sale, marketing, manufacturing and distribution; • may disagree with us about material issues, including proprietary rights, contract interpretation, payment obligations or the preferred course of discovery, development, sales or marketing, which might cause delays or terminations of the research, development or commercialization of product candidates, lead to additional and burdensome responsibilities for us with respect to product candidates, or result in litigation or arbitration, any of which would be time-consuming and expensive; • may not properly maintain or defend their or our relevant intellectual property rights or may use our proprietary information in such a way as to invite litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential litigation and liability; • may infringe the intellectual property rights of third parties, which may expose us to litigation and potential liability; • could become involved in a business combination or cessation that could cause them to deemphasize or terminate the development or commercialization of any product candidate licensed to it by us; and • may terminate our collaborations, which could require us to raise additional capital to develop or commercialize the applicable product candidates, or lose access to the collaborator’s intellectual property.
Our existing and future therapeutic collaborations may have a number of risks, including that collaborators: • have significant discretion in determining the efforts and resources that they will apply; 70 • may not perform their obligations as expected; • may dispute the amounts of payments owed; • may not pursue development and commercialization of any product candidates that achieve regulatory approval or may elect not to continue or renew development or commercialization programs or license arrangements based on clinical trial results, changes in their strategic focus or available funding, or external factors, such as a strategic transaction that may divert resources or create competing priorities; • may delay, insufficiently fund, stop, initiate new or repeat clinical trials, reformulate a product candidate for clinical testing, or abandon a product candidate; • could develop independently, or with third parties, products that compete directly or indirectly with our products and product candidates; • may view product candidates discovered in our collaborations as competitive with their own product candidates or products, which may cause collaborators to cease to devote resources to the development or commercialization of our product candidates; • may dispute ownership or rights in jointly developed technologies or intellectual property; • may fail to comply with applicable legal and regulatory requirements regarding the development, manufacture, sale, distribution or marketing of a product candidate or product; • with sales, marketing, manufacturing and distribution rights to our product candidates may not commit sufficient resources to the product’s sale, marketing, manufacturing and distribution; • may disagree with us about material issues, including proprietary rights, contract interpretation, payment obligations or the preferred course of discovery, development, sales or marketing, which might cause delays or terminations of the research, development or commercialization of product candidates, lead to additional and burdensome responsibilities for us with respect to product candidates, or result in litigation or arbitration, any of which would be time-consuming and expensive; • may not properly maintain or defend their or our relevant intellectual property rights or may use our proprietary information or sublicensed intellectual property rights in such a way as to invite litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential litigation and liability; • may infringe the intellectual property rights of third parties, which may expose us to litigation and potential liability; • could become involved in a business combination or cessation that could cause them to deemphasize or terminate the development or commercialization of any product candidate licensed to it by us; and • may terminate our collaborations, which could require us to raise additional capital to develop or commercialize the applicable product candidates, or lose access to the collaborator’s intellectual property.
Misconduct by these parties could include intentional, reckless and/or negligent conduct that fails to: comply with federal and state laws and those of other applicable jurisdictions; provide true, complete and accurate information to the FDA and other similar foreign regulatory bodies; comply with manufacturing standards; comply with federal and state data privacy, security, fraud and abuse and other healthcare laws and regulations in the U.S. and similar foreign privacy or fraudulent misconduct laws; or report financial information or data accurately; or disclose unauthorized activities to us.
Misconduct by these parties could include intentional, reckless and/or negligent conduct that fails to: comply with federal and state laws and those of other applicable jurisdictions; provide true, complete and accurate information to the FDA and other regulatory bodies in the U.S. or outside the U.S.; comply with manufacturing standards; comply with federal and state data privacy, security, fraud and abuse and other healthcare laws and regulations in the U.S. and similar foreign privacy or fraudulent misconduct laws; or report financial information or data accurately; or disclose unauthorized activities to us.
Even if we obtain coverage for a given product, the resulting reimbursement payment rates might be insufficient or may require co-payments that patients find unacceptably high, which may prevent us from achieving or sustaining profitability. Additionally, third-party payors may not cover, or provide adequate reimbursement for, long-term follow-up evaluations required following the use of our genome editing products.
Even if we obtain coverage for a given product, the resulting reimbursement payment rates might be insufficient or may require co-payments that patients find unacceptably high, which may prevent us from 79 achieving or sustaining profitability. Additionally, third party payors may not cover, or provide adequate reimbursement for, long-term follow-up evaluations required following the use of our genome editing products.
Risks Related to Our Reliance on Third Parties Risks Related to Our Reliance on Collaboration Partners Our technological advancements and any potential for revenue may be derived in part from our collaborations, including, for example, with Regeneron and AvenCell, and if the collaboration or co-development agreements related to a material collaboration were to be terminated or materially altered in an adverse manner, our business, financial condition, results of operations and prospects would be harmed.
Risks Related to Our Reliance on Third Parties Risks Related to Our Reliance on Collaboration Partners Our technological advancements and any potential for revenue may be derived in part from our collaborations, including, for example, with Regeneron, and if the collaboration or co-development agreements related to a material collaboration were to be terminated or materially altered in an adverse manner, our business, financial condition, results of operations and prospects would be harmed.
Pursuant to the terms of the license agreements with our licensors, the licensors may have the right to control enforcement of our licensed patents or defense of any claims asserting the invalidity of these patents and, even if we are permitted to pursue such enforcement or defense, we cannot ensure the cooperation of our licensors or, in some cases, other necessary parties, such as the co-owners of the intellectual property from which we have not yet obtained a license.
Pursuant to the terms of the license agreements with our licensors, the licensors may have the right to control enforcement of our licensed patents or defense of any claims asserting the invalidity of these patents and, even if we are permitted to pursue such 52 enforcement or defense, we cannot ensure the cooperation of our licensors or, in some cases, other necessary parties, such as the co-owners of the intellectual property from which we have not yet obtained a license.
The legal systems of certain countries, such as China, Brazil, Russia, India and South Africa, do not favor the enforcement of patents, trade secrets and other intellectual property, particularly those relating to biopharmaceutical products, which could make it difficult in those jurisdictions for us to stop the infringement or misappropriation of our patents or other intellectual property rights, or the marketing of competing products in violation of our proprietary rights.
The legal systems of certain countries, such as China, Brazil, Russia, India and South Africa, do not favor the enforcement of patents, trade secrets and other intellectual property, particularly those relating to biopharmaceutical products, which could make it difficult in those jurisdictions for us to stop the infringement or 56 misappropriation of our patents or other intellectual property rights, or the marketing of competing products in violation of our proprietary rights.
It is not always possible to identify and deter misconduct by employees and other third parties, and the precautions we take to detect and prevent this activity may not be 74 effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to comply with these laws or regulations.
It is not always possible to identify and deter misconduct by employees and other third parties, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to comply with these laws or regulations.
In the U.S., the principal decisions about reimbursement for new medicines are typically made by the Centers for Medicare & Medicaid Services (“CMS”), an agency within the U.S. Department of Health and Human Services. CMS decides whether and to what extent a new medicine will be covered and reimbursed under Medicare, and private payors often 55 follow CMS’s coverage decisions.
In the U.S., the principal decisions about reimbursement for new medicines are typically made by the Centers for Medicare & Medicaid Services (“CMS”), an agency within the U.S. Department of Health and Human Services. CMS decides whether and to what extent a new medicine will be covered and reimbursed under Medicare, and private payors often follow CMS’s coverage decisions.
We have only recently begun to manufacture and process product candidate components on a clinical scale and may not be able to successfully complete or continue to do so. We will 67 make changes to optimize the manufacturing process, and cannot be sure that even minor changes in the process will result in therapies that are safe, pure and potent.
We have only recently begun to manufacture and process product candidate components on a clinical scale and may not be able to successfully complete or continue to do so. We will make changes to optimize the manufacturing process, and cannot be sure that even minor changes in the process will result in therapies that are safe, pure and potent.
This patent portfolio to-date includes, for example, multiple granted, allowed, and/or allowable patent applications in the U.S., as well as granted patents from the European Patent Office, the United Kingdom’s Intellectual 77 Property Office, the German Patent and Trade Mark Office, Australia’s Intellectual Property agency and China’s Intellectual Property Office, among others. Because UC/Vienna co-own this portfolio with Dr.
This patent portfolio to-date includes, for example, multiple granted, allowed, and/or allowable patent applications in the U.S., as well as granted patents from the European Patent Office, the United Kingdom’s Intellectual Property Office, the German Patent and Trade Mark Office, Australia’s Intellectual Property agency and China’s Intellectual Property Office, among others. Because UC/Vienna co-own this portfolio with Dr.
To date, UC/Vienna/Charpentier have successfully defended before the EPO’s opposition division the validity of their first European patent, which covers compositions comprising Cas9 and single gRNA molecules, as well as methods of 82 editing DNA in vitro or ex vivo using Cas9 and single gRNAs. The opponents to this patent have appealed the decision of the EPO’s opposition division.
To date, UC/Vienna/Charpentier have successfully defended before the EPO’s opposition division the validity of their first European patent, which covers compositions comprising Cas9 and single gRNA molecules, as well as methods of editing DNA in vitro or ex vivo using Cas9 and single gRNAs. The opponents to this patent have appealed the decision of the EPO’s opposition division.
If we are unable to reach agreements with suitable collaborators on a timely basis, on acceptable 66 terms, or at all, we may have to curtail, delay or abandon discovery efforts or development programs, and the development, manufacture or commercialization of a product candidate, or increase our expenditures and undertake these activities at our own expense.
If we are unable to reach agreements with suitable collaborators on a timely basis, on acceptable terms, or at all, we may have to curtail, delay or abandon discovery efforts or development programs, and the development, manufacture or commercialization of a product candidate, or increase our expenditures and undertake these activities at our own expense.
We cannot predict whether, when, in what form, or with what effective dates, tax laws, regulations and rulings may be enacted, promulgated or issued, that could result in an increase in our or our stockholders’ tax liability. 91 Our ability to use our net operating loss ( “ NOL ” ) carryforwards and certain other tax attributes may be limited.
We cannot predict whether, when, in what form, or with what effective dates, tax laws, regulations and rulings may be enacted, promulgated or issued, that could result in an increase in our or our stockholders’ tax liability. Our ability to use our net operating loss ( “ NOL ” ) carryforwards and certain other tax attributes may be limited.
In the U.S., numerous federal and state laws and regulations, including federal health information privacy laws, state data breach notification laws, state health information privacy laws, and federal and state consumer protection laws (e.g., Section 5 of the Federal Trade Commission Act), that govern the collection, use, disclosure and protection of health-related and other personal information could apply to our operations or the operations of our collaborators.
In the U.S., numerous federal and state laws and regulations, including federal health information privacy laws, state data breach notification laws, state health information privacy laws, and federal and 68 state consumer protection laws (e.g., Section 5 of the Federal Trade Commission Act), that govern the collection, use, disclosure and protection of health-related and other personal information could apply to our operations or the operations of our collaborators.
In order to maintain our intellectual property rights under these agreements, we will need to meet certain specified milestones, subject to certain cure provisions, in the development of our product candidates. Further, our counterparties, including our licensors (or their licensors) or licensees, may dispute the terms, including amounts, that we are required to pay under the respective agreements.
In order to maintain our intellectual property rights under these agreements, we will need to meet certain specified 53 milestones, subject to certain cure provisions, in the development of our product candidates. Further, our counterparties, including our licensors (or their licensors) or licensees, may dispute the terms, including amounts, that we are required to pay under the respective agreements.
We could also encounter delays if a clinical trial is suspended or terminated by us, the IRBs of the institutions in which such trials are being conducted, the relevant ethics committee or the FDA or other relevant regulatory authorities, or if the Data Monitoring Committee (“DMC”) for such trial recommends such suspension or termination.
We could also encounter delays if a clinical trial is suspended or terminated by us, the IRBs of the institutions in which such trials are being conducted, the relevant ethics committee or the FDA or other relevant regulatory authorities, or 44 if the Data Monitoring Committee (“DMC”) for such trial recommends such suspension or termination.
For more information, please see the risk factor section entitled “ Risks Related to Data and Privacy. ” We may be subject to claims that our employees, directors, consultants, or independent contractors have wrongfully used or disclosed confidential information of third parties. We have received confidential and proprietary information from third parties.
For more information, see the risk factor section entitled “ Risks Related to Data and Privacy. ” We may be subject to claims that our employees, directors, consultants, or independent contractors have wrongfully used or disclosed confidential information of third parties. We have received confidential and proprietary information from third parties.
Further, the net losses we incur may fluctuate significantly from quarter to quarter and year to year, such that a period-to-period comparison of our results of operations may not be a good indication of our future performance. Risks Related to Future Financial Condition We may need to raise substantial additional funding to fund our operations.
Further, the net losses we incur may fluctuate significantly from quarter to quarter and year to year, such that a period-to-period comparison of our results of operations may not be a good indication of our future performance. 60 Risks Related to Future Financial Condition We may need to raise substantial additional funding to fund our operations.
Any termination of these licenses, loss by our licensors of the rights they receive from others, diminution of our rights or those of our licensors, or a finding that such intellectual property lacks legal effect, could result in the loss of significant rights and could harm our ability to commercialize any product candidates.
Any termination of these licenses, loss by our licensors of the rights they receive from others, diminution of our rights or those of our licensors, or a finding that such intellectual property lacks legal effect, could result in the 51 loss of significant rights and could harm our ability to commercialize any product candidates.
While the NIH Guidelines are not mandatory unless the research in question is being conducted at or sponsored by institutions receiving NIH funding of recombinant or synthetic nucleic acid molecule research, many companies and other institutions not otherwise subject to the NIH Guidelines voluntarily 71 follow them.
While the NIH Guidelines are not mandatory unless the research in question is being conducted at or sponsored by institutions receiving NIH funding of recombinant or synthetic nucleic acid molecule research, many companies and other institutions not otherwise subject to the NIH Guidelines voluntarily follow them.
For more information on these laws and regulations please see the section titled “ Business – Government Regulation and Product Approval – Other Healthcare and Privacy Laws.” The scope and enforcement of each of these laws is not always certain and is subject to legislative, judicial or prosecutorial changes.
For more information on these laws and regulations see the section titled “ Business – Government Regulation and Product Approval – Other Healthcare and Privacy Laws .” The scope and enforcement of each of these laws is not always certain and is subject to legislative, judicial or prosecutorial changes.
Our employees, independent contractors, clinical investigators, CMOs, CROs, consultants, commercial partners and vendors may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements, which could have a material adverse effect on our business.
Our employees, independent contractors, clinical investigators, CMOs, CROs, consultants, collaborators, commercial partners and vendors may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements, which could have a material adverse effect on our business.
Risks Related to Confidentiality Confidentiality agreements with employees and third parties may not prevent unauthorized disclosure of trade secrets and other proprietary information. In addition to the protection afforded by patents, we seek to rely on trade secret protection and confidentiality agreements to protect our proprietary and confidential information.
Risks Related to Potential Disclosure of Confidential Information Confidentiality agreements with employees and third parties may not prevent unauthorized disclosure of trade secrets and other proprietary information. In addition to the protection afforded by patents, we seek to rely on trade secret protection and confidentiality agreements to protect our proprietary and confidential information.
Furthermore, the laws of some foreign countries do not protect proprietary rights to the same extent or in the same manner as the laws of the U.S. As a result, we may encounter significant problems in protecting and defending our intellectual property both in the U.S. and abroad.
Furthermore, the laws of some foreign countries do not protect proprietary rights to the same extent or in the same manner as the laws of the U.S. As a result, we may encounter significant 58 problems in protecting and defending our intellectual property both in the U.S. and abroad.
Based on these and other factors, healthcare providers and payors may decide that the benefits of these new therapies do not or will not outweigh their costs. Clinical development involves a lengthy and expensive process, with an uncertain outcome.
Based on these and other factors, healthcare providers and payors may decide that the benefits of these new therapies do not or will not outweigh their costs. 42 Clinical development involves a lengthy and expensive process, with an uncertain outcome.
These different laws governing the privacy and security of health and other personal information often differ from each other in significant 56 ways and may not have the same effective requirements, thus complicating efforts to comply with their respective provisions.
These different laws governing the privacy and security of health and other personal information often differ from each other in significant ways and may not have the same effective requirements, thus complicating efforts to comply with their respective provisions.
Orphan drug designation must be requested before submitting a BLA. In the U.S., orphan drug designation entitles a party to financial incentives such as opportunities for grant funding towards clinical trial costs, tax advantages and user-fee waivers.
Orphan drug designation must be requested before submitting a BLA. In the U.S., orphan drug designation entitles a party to financial incentives such as opportunities 64 for grant funding towards clinical trial costs, tax advantages and user-fee waivers.
If we obtain FDA approval of any of our product candidates and begin commercializing those products in the U.S., our potential exposure under such laws will increase significantly, and our costs associated with compliance with such laws are also likely to increase.
If we obtain FDA approval of any of our product candidates and begin commercializing those products in the U.S., our potential exposure under such laws will increase significantly, and our costs associated 67 with compliance with such laws are also likely to increase.
For this reason, we 52 will employ multiple steps to control the manufacturing process to ensure that the process results in product candidates that meet their specifications, but complications at any one step could adversely impact our manufacturing of products.
For this reason, we will employ multiple steps to control the manufacturing process to ensure that the process results in product candidates that meet their specifications, but complications at any one step could adversely impact our manufacturing of products.
Moreover, clinical trial subjects, employees and other individuals about whom we or our potential collaborators obtain personal information, as well as the providers who share this information with us, may limit our ability to collect, use and disclose the information.
Moreover, clinical trial subjects, employees and other individuals about whom we or our existing or potential collaborators obtain personal information, as well as the providers who share this information with us, may limit our ability to collect, use and disclose the information.
Competitors in our efforts to provide genetic therapies to patients can be grouped into at least three sets based on their product discovery platforms: Our platform and product foci are on the development of therapies using CRISPR-based technologies.
Competitors in our efforts to provide other genetic therapies to patients can be grouped into at least three sets based on their product discovery platforms: Our platform and product foci are on the development of therapies using CRISPR-based technologies.
We cannot predict the impact of the WHO’s current and future recommendations, or any policies or actions that ethics committees or regulatory agencies may take in response to such recommendations, on our research, clinical and business plans and results.
We cannot predict the impact of the WHO’s current and future 63 recommendations, or any policies or actions that ethics committees or regulatory agencies may take in response to such recommendations, on our research, clinical and business plans and results.
We may sell common stock, convertible securities or other equity securities in one or more transactions at prices and in a manner we determine from time to time. If we sell common stock, convertible securities or other equity securities in more than one transaction, investors may be materially diluted by subsequent sales.
We may sell common stock, convertible securities or other equity securities in one or more transactions at prices and in a manner we determine from time to time. If we sell common stock, convertible securities or other equity securities in more 85 than one transaction, investors may be materially diluted by subsequent sales.
These laws impose civil and criminal monetary penalties, and give state attorneys general the authority to file civil actions for damages or injunctions, and attorney’s fees, in federal courts to enforce the laws; • the California Consumer Privacy Act (“CCPA”) requires covered companies to provide new disclosures to California consumers and afford such consumers new rights with respect to their personal information, including the rights to: request deletion of their information, receive the information on record for them, know what categories of information are being maintained about them, and opt-out of certain sales of their information.
These laws impose civil and criminal monetary penalties, and give state attorneys general the authority to file civil actions for damages or injunctions, and attorney’s fees, in federal courts to enforce the laws; 80 • the California Consumer Privacy Act (“CCPA”) requires covered companies to provide disclosures to California consumers and afford such consumers rights with respect to their personal information, including the rights to: request deletion of their information, receive the information on record for them, know what categories of information are being maintained about them, and opt-out of certain sales of their information.
Noncompliance events that could result in abandonment or lapse of a patent or patent application include failure to respond to official actions within prescribed time limits, non-payment of fees, and failure to properly legalize 85 and submit formal documents.
Noncompliance events that could result in abandonment or lapse of a patent or patent application include failure to respond to official actions within prescribed time limits, non-payment of fees, and failure to properly legalize and submit formal documents.
Failure to comply with these laws and regulations could result in government enforcement actions (which could include civil, criminal and administrative penalties), private 75 litigation, and/or adverse publicity and could negatively affect our operating results and business.
Failure to comply with these laws and regulations could result in government enforcement actions (which could include civil, criminal and administrative penalties), private litigation, and/or adverse publicity and could negatively affect our operating results and business.
We are exposed to the risk of non-compliance, fraud, misconduct or other illegal activity by our employees, independent contractors, clinical investigators, CMOs, CROs, consultants, commercial partners and vendors.
We are exposed to the risk of non-compliance, fraud, misconduct or other illegal activity by our employees, independent contractors, clinical investigators, CMOs, CROs, consultants, collaborators, commercial partners and vendors.
If a defendant were to prevail on a legal assertion of invalidity, unpatentability and/or unenforceability, we would lose at least part, and perhaps all, of the patent protection on our product candidates.
If a defendant were to prevail on a legal assertion of invalidity, unpatentability and/or unenforceability, we would lose at least part, and perhaps all, of the 57 patent protection on our product candidates.
We have no products approved for commercial sale, have not generated any revenue from product sales, and do not anticipate generating any revenue from product sales until we have received regulatory approval for the commercial 61 sale of one of our product candidates.
We have no products approved for commercial sale, have not generated any revenue from product sales, and do not anticipate generating any revenue from product sales until we have received regulatory approval for the commercial sale of one of our product candidates.
If we experience termination of, or delays in the completion of, any clinical trial of product candidates, the commercial prospects for our product candidates will be harmed, and our ability to generate product revenue will be impaired.
If we experience termination of, or delays in the completion of, any clinical trial of product candidates, the commercial prospects for such product candidates will be harmed, and our ability to generate product revenue will be impaired.
In addition, although we intend to seek orphan drug designation for other product candidates, we may never receive such designations. 72 The FDA may reevaluate the Orphan Drug Act and its regulations and policies.
In addition, although we intend to seek orphan drug designation for other product candidates, we may never receive such designations. The FDA may reevaluate the Orphan Drug Act and its regulations and policies.
In addition, our ability to enroll and dose patients may be delayed by the regulatory authority as well as, the IRB or another ethics committee (whether local or national).
In addition, our ability to enroll and dose patients may be delayed by the relevant regulatory authority, as well as the IRB or another ethics committee (whether local or national).
Our development candidates are complex and may include multiple components such as Cas9 protein or messenger ribonucleic acid (“mRNA”) encoding Cas9 protein, guide ribonucleic acids (“gRNAs”), targeting molecules, or formulation components such as lipids.
Our development candidates are complex and may include multiple components such as Cas9 protein or messenger ribonucleic acid encoding Cas9 protein, guide ribonucleic acids (“gRNAs”), targeting molecules, or formulation components such as lipids.
For example, the FDA or other regulatory agency may also require a REMS or similar program as a condition of approval of our product candidates, which could entail requirements for long-term patient follow-up, a medication guide, physician communication plans or additional elements to ensure safe use, such as restricted distribution methods, patient registries and other risk minimization tools.
For example, the FDA or other regulatory agencies may also require a REMS or similar program as a condition of approval of our product candidates, which could entail requirements for long-term patient follow-up, a medication guide, physician communication plans or additional elements to ensure safe use, such as restricted distribution methods, patient registries and other risk minimization tools.
Public perception may be influenced by claims that gene therapy or genome editing, including the use of CRISPR/Cas9, is unsafe or unethical, or carries an undue risk of side effects, such as improper modification of a gene sequence in a patient’s chromosome that could lead to cancer, and 50 gene therapy or genome editing may not gain the acceptance of the public or the medical community.
Public perception may be influenced by claims that gene therapy or genome editing, including the use of CRISPR/Cas9, is unsafe or unethical, or carries an undue risk of side 46 effects, such as improper modification of a gene sequence in a patient’s chromosome that could lead to cancer, and gene therapy or genome editing may not gain the acceptance of the public or the medical community.
In addition, our product candidates must be approved for marketing by the FDA, or certain other foreign regulatory agencies, before we may commercialize any product. 62 Our limited operating history, particularly in light of the rapidly evolving genome editing field, may make it difficult to evaluate our current business and predict our future performance.
In addition, our product candidates must be approved for marketing by the FDA, or certain other foreign regulatory agencies, before we may commercialize any product. Our operating history, particularly in light of the rapidly evolving genome editing field, may make it difficult to evaluate our current business and predict our future performance.
The outcome of preclinical testing and early clinical trials may not be predictive of the success of later clinical trials, and interim results of a clinical trial do not necessarily predict final results.
The outcome of preclinical testing and clinical trials may not be predictive of the success of later clinical trials, and interim results of a clinical trial do not necessarily predict final results.
Moreover, we cannot guarantee that the FDA, MHRA, the New Zealand Medicines and Medical Devices Safety Authority (“MEDSAFE”), or other regulatory authorities will not change their requirements in the future or approve amendments to our INDs or equivalent regulatory filings, including for NTLA-2001, NTLA-2002 or our other product candidates on the timeline we expect.
Moreover, we cannot guarantee that the FDA, MHRA, the New Zealand Medicines and Medical Devices Safety Authority, or other regulatory authorities will not change their requirements in the future or approve amendments to our INDs or equivalent regulatory filings, including for NTLA-2001, NTLA-2002, NTLA-3001 or our other product candidates on the timeline we expect.
European Data Protection Law imposes strict requirements, including special protections for “sensitive” personal data which includes health and genetic information of individuals in the EU or the U.K.; expanded disclosures about the personal data use; information retention limitations; mandatory data breach notification requirements; and additional oversight obligations relating to third parties retained to process the personal data.
European Data Protection Law imposes strict requirements, including special protections for “sensitive” personal data which includes health and genetic information of individuals in the EEA or the U.K.; expanded disclosures about the personal data use; information retention limitations; mandatory data breach notification requirements; and additional oversight obligations relating to third parties retained to process the personal data.
The regulatory regime in Great Britain therefore currently aligns in the most part with EU regulations, however it is possible that these regimes will diverge in the future now that Great Britain’s regulatory system is independent from the EU and the TCA does not provide for mutual recognition of U.K. and EU pharmaceutical legislation.
The regulatory regime in Great Britain therefore currently aligns for the most part with EU regulations; however, it is possible that these regimes will diverge more significantly in the future now that Great Britain’s regulatory system is independent from the EU and the TCA does not provide for mutual recognition of U.K. and EU pharmaceutical legislation.
In evaluating us and our business, careful consideration should be given to the following risk factors, in addition to the other information set forth in this Annual Report on Form 10-K for the year ended December 31, 2022 and in other documents that we file with the SEC.
In evaluating us and our business, careful consideration should be given to the following risk factors, in addition to the other information set forth in this Annual Report on Form 10-K for the year ended December 31, 2023 and in other documents that we file with the SEC.
Accordingly, the regulatory approval pathway for such product candidates may be uncertain, complex, expensive and lengthy, as well as different in each jurisdiction, and approval may not be obtained in any, some or all jurisdictions. Other non-regulatory entities may impact the regulatory agencies and ethics committees’ evaluation and approval decision regarding our product candidates.
Accordingly, the regulatory approval pathway for such product candidates may be uncertain, complex, expensive and lengthy, as well as different in each jurisdiction, and approval may not be obtained in any, some or all jurisdictions. Other non-regulatory entities may impact the regulatory agencies’ and ethics committees’ evaluation and approval decision regarding our product candidates.
Because the patent applications involved in these interferences also purport to cover the use of CRISPR/Cas9 for gene editing in eukaryotic cells, the PTAB seeks to determine between the various groups which one invented first and is entitled to the resulting patents.
Because the patent applications involved in these interferences also purport to cover the use of CRISPR/Cas9 for gene editing in eukaryotic cells, the PTAB seeks to determine between the various groups which one invented first and is entitled to the resulting U.S. patents.
Filing, prosecuting, maintaining and defending patents on product candidates in all countries throughout the world would be prohibitively expensive, and our intellectual property rights in some countries outside the U.S. can have a different scope and strength than do those in the U.S.
We have limited intellectual property rights outside the U.S. Filing, prosecuting, maintaining and defending patents on product candidates in all countries throughout the world would be prohibitively expensive, and our intellectual property rights in some countries outside the U.S. can have a different scope and strength than do those in the U.S.
While we have implemented security measures to protect our information technology systems and infrastructure, there is no assurance that such measures will prevent service interruptions or security breaches that could adversely affect our business. 59 Interruptions in the availability of server systems or communications with internet or cloud-based services, or failure to maintain the security, confidentiality, accessibility or integrity of data stored on such systems, could harm our business.
While we have implemented security measures to protect our information technology systems and infrastructure, there is no assurance that such measures will prevent service interruptions or security breaches or incidents that could adversely affect our business. 75 Interruptions in the availability of server systems or communications with internet or cloud-based services, or failure to maintain the security, confidentiality, accessibility or integrity of data stored on such systems, could harm our business.
We may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of any product candidates. All of our lead programs are still in the discovery, preclinical or early clinical stage.
We may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of any product candidates. All of our programs are still in the discovery, preclinical or clinical stage.
Significant disruptions of these information technology systems or security breaches could adversely affect our business operations and/or result in the loss, misappropriation, and/or unauthorized access, use, or disclosure of, or the prevention of access to, confidential information (including but not limited to trade secrets or other intellectual property, proprietary business information, and personal information), and could result in financial, legal, business, and reputational harm to us and would adversely affect our operations, including our discovery and research and development programs.
Significant disruptions to our information technology systems could adversely affect our business operations and/or result in the loss, misappropriation, and/or unauthorized access, use, or disclosure of, or the prevention of access to, confidential information (including but not limited to trade secrets or other intellectual property, proprietary business information, and personal information), and could result in financial, legal, business, and reputational harm to us and would adversely affect our operations, including our discovery and research and development programs.
In addition, the collection and use of Personally Identifiable Information, including Protected Health Information (“PHI”), is regulated by federal, state and foreign privacy, data security and data protection laws. Failure to comply with these laws could impair our ability to properly sell our product candidates in particular jurisdictions and subject us to liability from private and governmental entities.
In addition, the collection and use of personal information, including Protected Health Information (“PHI”), is regulated by federal, state and foreign privacy, data security and data protection laws. Failure to comply with these laws could impair our ability to properly sell our product candidates in particular jurisdictions and subject us to liability from private and governmental entities.
We are exposed to risks associated with the launch of the new company and may not realize the advantages we expect from it. In July 2021, we launched AvenCell alongside Cellex Cell Professionals GmbH (“Cellex”) and Blackstone Life Sciences Advisors L.L.C. (“BXLS”). AvenCell acquired GEMoaB GmbH (“GEMoaB”), a wholly owned subsidiary of Cellex.
We are exposed to risks associated with the launch of the new company and may not realize the advantages we expect from it. In July 2021, we launched AvenCell Therapeutics, Inc. (“AvenCell”) alongside Cellex Cell Professionals GmbH (“Cellex”) and Blackstone Life Sciences Advisors L.L.C. (“BXLS”). AvenCell acquired GEMoaB GmbH (“GEMoaB”), a wholly owned subsidiary of Cellex.
Additionally, because our in vivo technology potentially involves genome editing across multiple cell and tissue types, we are subject to many of the challenges and risks that other genome editing therapeutics and gene therapies face, including: • regulatory guidance regarding the requirements governing gene and genome editing therapy products have changed and may continue to change in the future, including, e.g., the draft guidance document titled “Human Gene Therapy Products Incorporating Human Genome Editing” that the FDA issued in March 2022; • to date, only a limited number of products that involve in vivo gene transfer have been approved globally; • improper modulation of a gene sequence, including unintended editing events or insertion of a sequence into certain locations in a patient’s chromosome, could lead to cancer, other aberrantly functioning cells or other diseases, including death; • transient expression of the Cas9 protein or other genome editing components of our product candidates could lead to patients having an immunological reaction towards those cells, which could be severe or life-threatening; • corrective expression of a missing protein in patients’ cells could result in the protein being recognized as foreign, and lead to a sustained immunological reaction against the expressed protein or expressing cells, which could be severe or life-threatening; and • regulatory agencies may require extended follow-up observation periods of patients who receive treatment using genome editing products including, for example, the FDA’s recommended 15-year follow-up 49 observation period for these patients, and we will need to adopt such observation periods for our product candidates if required by the relevant regulatory agency, which could vary by country or region.
Additionally, because our in vivo technology potentially involves genome editing across multiple cell and tissue types, we are subject to many of the challenges and risks that other genome editing therapeutics and gene therapies face, including: • regulatory guidance regarding the requirements governing gene and genome editing therapy products have changed and may continue to change in the future, including, e.g., the finalized guidance document titled “Human Gene Therapy Products Incorporating Human Genome Editing” that the FDA issued in January 2024; • to date, only a limited number of products that involve in vivo gene transfer have been approved globally; • improper modulation of a gene sequence, including unintended editing events, insertion of a sequence into certain locations in a patient’s chromosome or other effects related to the biodistribution of our product candidates, could lead to cancer, other aberrantly functioning cells or other diseases, including death; • transient expression of the Cas9 protein or other genome editing components of our product candidates could lead to patients having an immunological reaction towards those cells, which could be severe or life-threatening; • corrective expression of a missing protein in patients’ cells could result in the protein being recognized as foreign, and lead to a sustained immunological reaction against the expressed protein or expressing cells, which could be severe or life-threatening; and • regulatory agencies may require extended follow-up observation periods of patients who receive treatment using genome editing products including, for example, the FDA’s recommended 15-year follow-up observation period for these patients, and we will need to adopt such observation periods for our product candidates if required by the relevant regulatory agency, which could vary by country or region.
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 very 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 clinical-stage companies in rapidly evolving fields. If we do not address these risks successfully, our business will suffer.
All of our product candidates are still in the preclinical development or early clinical stage.
All of our product candidates are still in the preclinical development or clinical stage.
Any action for violation of these laws, even if successfully defended, could result in significant legal expenses and divert management’s attention from the operation of the business. Prohibitions or restrictions on sales (including importation or exportation) or withdrawal of future marketed products could materially affect business in an adverse way.
Any action alleging a violation of these laws, even if successfully defended, could result in significant legal expenses and divert management’s attention from the operation of the business. Prohibitions or restrictions on sales (including importation or exportation) or withdrawal of future marketed products could materially affect business in an adverse way.
Security breaches, insider threats and other inappropriate access can be difficult to detect, and any delay in identifying them may lead to increased harm of the type summarized and described above.
Security breaches, insider threats and other inappropriate access can be difficult to detect, and any delay in identifying them may lead to increased harm of the types summarized and described above.
If any noncompliance actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business, including the imposition of significant civil, criminal and administrative penalties, damages, disgorgement, monetary fines, individual imprisonment, exclusion from participation in federal healthcare programs (such as Medicare and Medicaid), contractual damages, reputational harm, diminished profits and future earnings, and curtailment or restructuring of our operations, as well as additional reporting obligations and oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws, any of which could adversely affect our ability to operate our business and our results of operations.
If any noncompliance actions are instituted against us, those actions could have a significant impact on our business, including the imposition of significant civil, criminal and administrative penalties, damages, disgorgement, monetary fines, individual imprisonment, exclusion from participation in federal healthcare programs (such as Medicare and Medicaid), contractual damages, reputational harm, diminished profits and future earnings, and curtailment or restructuring of our operations, as well as additional reporting obligations and oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws, any of which could adversely affect our ability to operate our business and affect the results of our operations.
For example, reports of the use of CRISPR/Cas9 in China and Russia to edit embryos in utero have generated and may continue to create negative public perception about the use of the technology in humans.
For example, reports of the use of CRISPR/Cas9 in China and Russia to edit embryos in utero have generated, and may continue to generate, negative public perception about the use of the technology in humans.
Specific to our NTLA-2002 program, we are aware of other companies that are currently commercializing or developing products used to treat HAE, including Takeda Pharmaceutical Company Limited, Astria Therapeutics Inc., ADARx Therapeutics, Inc., BioCryst Pharmaceuticals Inc., BioMarin Pharmaceuticals Inc., Pharming Group N.V. and CSL Limited.
Specific to our NTLA-2002 program, we are aware of other companies that are currently commercializing or developing products used to treat HAE, including ADARx Therapeutics, Inc., Astria Therapeutics Inc., BioCryst Pharmaceuticals Inc., BioMarin Pharmaceuticals Inc., CSL Limited, Ionis Pharmaceuticals, Inc., KalVista Pharmaceuticals, Inc., Pharming Group N.V., Pharvaris N.V. and Takeda Pharmaceutical Company Limited.
For more information on coverage and reimbursement please see the section entitled “ Business – Government Regulation and Product Approval – Coverage and Reimbursement .” In the U.S. and some other jurisdictions, patients generally rely on third-party payors to reimburse all or part of the costs associated with their treatment.
For more information on coverage and reimbursement see the section entitled “Business – Government Regulation and Product Approval – Coverage and Reimbursement . ” In the U.S. and some other jurisdictions, patients generally rely on third party payors to reimburse all or part of the costs associated with their treatment.
We and these third parties are required to comply with good clinical practice (“GCP”), which are regulations and guidelines enforced by the FDA, EMA and comparable foreign regulatory authorities for product candidates in clinical development. Regulatory authorities enforce these GCP requirements through periodic inspections of trial sponsors, clinical investigators and trial sites.
We and these third parties are required to comply with GCP, which are regulations and guidelines enforced by the FDA, EMA and comparable foreign regulatory authorities for product candidates in clinical development. Regulatory authorities enforce these GCP requirements through periodic inspections of trial sponsors, clinical investigators and trial sites.
If such third parties were found to have rights to the CRISPR/Cas9 technology, we could be required to obtain rights from such parties or cease our development and commercialization efforts.
If such third parties were found to have rights to the licensed technology (such as CRISPR/Cas9 technology), we could be required to obtain rights from such parties or cease our development and commercialization efforts.
From time to time, we may disclose interim data from our clinical trials, such as the interim results of our ongoing Phase 1 study of NTLA-2001 or our ongoing Phase 1/2 study of NTLA-2002.
From time to time, we may disclose interim data from our clinical trials, such as the interim results of our ongoing Phase 1 study of NTLA-2001 or Phase 1/2 study of NTLA-2002 or planned Phase 1 study of NTLA-3001.
In addition, any changes in these providers’ service levels may adversely affect our ability to meet our requirements and operate our business. Social media platforms present new risks and challenges to our business. As social media continues to expand, it also presents us with new risks and challenges.
In addition, any changes in these providers’ service levels may adversely affect our ability to meet our requirements and operate our business. Social media platforms and artificial intelligence-based platforms present new risks and challenges to our business. As social media continues to expand, it also presents us with new risks and challenges.

… 283 more changes not shown on this page.

Item 2. Properties

Properties — owned and leased real estate

2 edited+1 added−0 removed6 unchanged
Biggest changeIn February 2022, we entered into an agreement to lease approximately 140,000 square feet of office, general laboratory and manufacturing space at 840 Winter Street, Waltham Massachusetts, which will provide us with the ability to manufacture products in a good manufacturing practice (“GMP”) compliant facility.
Biggest changeIn February 2022, we entered into an agreement to lease approximately 140,000 square feet of office, general laboratory and manufacturing space at 840 Winter Street, Waltham Massachusetts, which will provide us with the ability to manufacture products in a good manufacturing practice (“GMP”) compliant facility in the future.
This lease is expected to commence in 2024 with an initial term of twelve years and an option to extend the lease for two five-year terms.
This lease is expected to commence in the second half of 2024 with an initial term of twelve years and an option to extend the lease for two five-year terms.
Added
We have subleased approximately 13,000 square feet of this property for office and laboratory use through March 2026.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed2 unchanged
Biggest changeMine Safe ty Disclosures Not applicable. 92 PART II
Biggest changeMine Safe ty Disclosures Not applicable. 89 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

6 edited+0 added−1 removed1 unchanged
Biggest changeWe do not intend to pay cash dividends to our stockholders in the foreseeable future. 93 Stock Performance Graph The following graph shows a comparison from May 6, 2016, the first date that shares of our common stock were publicly traded, through December 31, 2022, of the cumulative total return on an assumed investment of $100.00 in cash in our common stock, the Nasdaq Composite Index and the Nasdaq Biotechnology Index for the same period.
Biggest changeStock Performance Graph The following graph shows a comparison from December 31, 2018 through December 31, 2023, of the cumulative total return on an assumed investment of $100.00 in cash in our common stock, the Nasdaq Composite Index and the Nasdaq Biotechnology Index. Such returns are based on historical results and are not intended to suggest future performance.
The actual number of holders of our common stock is greater than this number of record holders, and includes stockholders who are beneficial owners, but whose shares are held in street name by brokers or held by other nominees. This holders of record number also does not include stockholders whose shares may be held in trust by other entities.
The actual number of holders of our common stock is greater than this number of record holders, and includes stockholders who are beneficial owners, but whose shares are held in street name by brokers or held by other nominees. The number of holders of record also does not include stockholders whose shares may be held in trust by other entities.
Unregistered Sales of Equity Securities and Use of Proceeds None. Item 6. [R e served]. 94
Unregistered Sales of Equity Securities and Use of Proceeds None. Item 6. [R e served]. 91
The performance graph in this Item 5 is not deemed to be “soliciting material” or to be “filed” with the Securities and Exchange Commission for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, or otherwise subject to the liabilities under that Section, and shall not be deemed incorporated by reference into any of our filings under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent we specifically incorporate it by reference into such a filing.
Data for the Nasdaq Composite Index and the Nasdaq Biotechnology Index assume reinvestment of dividends. 90 The performance graph in this Item 5 is not deemed to be “soliciting material” or to be “filed” with the Securities and Exchange Commission for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, or otherwise subject to the liabilities under that Section, and shall not be deemed incorporated by reference into any of our filings under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent we specifically incorporate it by reference into such a filing.
Item 5. Market for the Registrant’s Common Equity, Related St ockholder Matters and Issuer Purchases of Equity Securities Our common stock is traded on the Nasdaq Global Market under the symbol “NTLA”. As of February 17, 2023, the number of holders of record of our common stock was 19.
Item 5. Market for the Registrant’s Common Equity, Related St ockholder Matters and Issuer Purchases of Equity Securities Our common stock is traded on the Nasdaq Global Market under the symbol “NTLA”. As of February 16, 2024, the number of holders of record of our common stock was 14.
Dividends We have never declared or paid cash dividends on our capital stock. We intend to retain all of our future earnings, if any, to finance the growth and development of our business.
Dividends We have never declared or paid cash dividends on our capital stock. We intend to retain all of our future earnings, if any, to finance the growth and development of our business. We do not intend to pay cash dividends to our stockholders in the foreseeable future.
Removed
Such returns are based on historical results and are not intended to suggest future performance. Data for the Nasdaq Composite Index and the Nasdaq Biotechnology Index assume reinvestment of dividends.

Item 7. Management's Discussion & Analysis

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

47 edited+13 added−12 removed32 unchanged
Biggest changeYear Ended December 31, Period-to- Percent 2022 2021 Period Change Change External development expenses by program: NTLA-2001 $ 37,849 $ 24,350 $ 13,499 55 % NTLA-2002 11,611 7,375 4,236 57 % NTLA-5001 17,827 22,157 (4,330 ) -20 % Unallocated research and development expenses: Employee-related expenses 112,975 70,798 42,177 60 % Research materials and contracted services 86,296 49,796 36,500 73 % In-process research and development 55,990 - 55,990 - Facility-related expenses 37,618 26,873 10,745 40 % Stock-based compensation 56,279 26,712 29,567 111 % Other 3,534 1,746 1,788 102 % Total research and development expenses $ 419,979 $ 229,807 $ 190,172 83 % The increase in research and development expenses for the year ended December 31, 2022 compared to the year ended December 31, 2021 was primarily attributable to: • a $13.5 million increase in external costs related to the development of NTLA-2001, our lead product candidate for the treatment of transthyretin (“ATTR”) amyloidosis, primarily due to an increase in spend on contracted services and drug components; • a $4.2 million increase in external costs related to the development of NTLA-2002, our lead product candidate for the treatment of hereditary angioedema (“HAE”), primarily due to an increase in spend on contracted services; • a $4.3 million decrease in external costs related to the development of NTLA-5001, our former product candidate for acute myeloid leukemia (“AML”), primarily due to a decrease in contracted services as we continued to wind down the program during the fourth quarter of 2022; • a $42.2 million increase in employee-related expenses, primarily driven by the increase in personnel growth to support our lead programs; • a $36.5 million increase in research materials and contracted services primarily driven by an increase in drug component expenses and consumables to support our pipelines; • $56.0 million of acquired in-process research and development expense in the first half of 2022 related to the acquisition of Rewrite Therapeutics, Inc.
Biggest changeYear Ended December 31, Period-to- Percent 2023 2022 Period Change Change External development expenses by program: NTLA-2001 $ 54,454 $ 37,849 $ 16,605 44 % NTLA-2002 24,560 11,611 12,949 112 % NTLA-3001 17,312 11,506 5,806 50 % NTLA-5001 - 17,827 (17,827 ) -100 % Unallocated research and development expenses: Employee-related expenses 136,628 112,931 23,697 21 % Research materials and contracted services 60,726 74,834 (14,108 ) -19 % In-process research and development - 55,990 (55,990 ) -100 % Research milestone 874 - 874 - Facility-related expenses 53,141 37,618 15,523 41 % Stock-based compensation 82,211 56,279 25,932 46 % Other 5,163 3,534 1,629 46 % Total research and development expenses $ 435,069 $ 419,979 $ 15,090 4 % 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: • a $16.6 million increase in external costs related to the development of NTLA-2001, our lead product candidate, primarily due to an increase in spend on drug components and contracted services; • a $12.9 million increase in external costs related to the development of NTLA-2002, primarily due to an increase in spend on drug components, contracted services and consulting services; • a $5.8 million increase in external costs related to NTLA-3001, primarily related to an increase in spend on drug components and consulting and professional services, offset in part by a decrease in spend on contracted services; • a $17.8 million decrease in external costs related to the development of NTLA-5001, as we discontinued this program as part of our pivot to an allogeneic pipeline; • a $23.7 million increase in employee-related expenses, primarily driven by the increase in personnel growth to support our lead programs; • a $14.1 million decrease in research materials and contracted services primarily driven by a decrease in drug component expenses and contracted services related to early stage programs; • a $56.0 million decrease in in-process research and development expense related to the acquisition of Rewrite Therapeutics, Inc. in the first half of 2022; • a $15.5 million increase in facility-related expenses primarily related to rent, depreciation, maintenance and services, and technology expense allocated to research and development; and • a $25.9 million increase in stock-based compensation driven by increases in employee headcount in 2023 compared to 2022.
At-the-Market Offering Programs In August 2019, we entered into an Open Market Sale Agreement (the “2019 Sale Agreement”) with Jefferies LLC (“Jefferies”), under which Jefferies was able to offer and sell, from time to time in “at-the-market” offerings, shares of our common stock having aggregate gross proceeds of up to $150.0 million.
At-the-Market Offering Programs 2019 Sale Agreement In August 2019, we entered into an Open Market Sale Agreement (the “2019 Sale Agreement”) with Jefferies LLC (“Jefferies”), under which Jefferies was able to offer and sell, from time to time in “at-the-market” offerings, shares of our common stock having aggregate gross proceeds of up to $150.0 million.
The 2019 Sale Agreement expired in the third quarter of 2022. In March 2022, we entered into an Open Market Sale Agreement (the “2022 Sale Agreement”) with Jefferies, under which Jefferies is able to offer and sell, from time to time in “at-the-market” offerings, shares of our common stock having aggregate gross proceeds of up to $400.0 million.
The 2019 Sale Agreement expired in the third quarter of 2022. 2022 Sale Agreement In March 2022, we entered into an Open Market Sale Agreement (the “2022 Sale Agreement”) with Jefferies, under which Jefferies is able to offer and sell, from time to time in “at-the-market” offerings, shares of our common stock having aggregate gross proceeds of up to $400.0 million.
Net cash provided by financing activities Net cash provided by financing activities of $583.0 million during the year ended December 31, 2022 is primarily due to the receipt of $337.9 million in net proceeds from a follow-on offering of our common stock, $227.9 million in net proceeds from at-the-market offerings, $14.5 million in cash received from the exercise of stock options and $2.6 million in cash received from the issuance of shares through our employee stock purchase plan.
Net cash provided by financing activities of $583.0 million during the year ended December 31, 2022 is primarily due to the receipt of $337.9 million in net proceeds from a follow-on offering of our common stock, $227.9 million in net proceeds from at-the-market offerings, $14.5 million in cash received from the exercise of stock options and $2.6 million in cash received from the issuance of shares through our employee stock purchase plan.
We define our critical accounting policies as those accounting principles generally accepted in the U.S. that require the most significant estimates and judgments about matters that are uncertain and are likely to have a material impact on our financial condition and results of operations as well as the specific manner in which we apply those principles.
We define our critical accounting policies as those accounting principles generally accepted in the U.S. that require the most significant judgments and estimates about matters that are uncertain and are likely to have a material impact on our financial condition and results of operations as well as the specific manner in which we apply those principles.
Our ability to generate revenue and achieve profitability depends significantly on our success in many areas, including: developing our delivery technologies and our CRISPR/Cas9 technology platform; selecting appropriate product candidates to develop; completing research and preclinical and clinical development of selected product candidates; obtaining regulatory approvals and marketing authorizations for product candidates for which we complete clinical trials; developing a sustainable and scalable manufacturing process for product candidates; launching and commercializing product candidates for which we obtain regulatory approvals and marketing authorizations, either directly or with a collaborator or distributor; obtaining market acceptance of our product candidates; addressing any competing technological and market developments; negotiating favorable terms in any collaboration, licensing, or other arrangements into which we may enter; maintaining good relationships with our collaborators and licensors; maintaining, protecting, and expanding our portfolio of IP rights, including patents, trade secrets, and know-how; and attracting, hiring, and retaining qualified personnel.
Our ability to generate revenue and achieve profitability depends significantly on our success in many areas, including: developing our delivery technologies and our CRISPR/Cas9 technology platform; selecting appropriate product candidates to develop; completing research and preclinical and clinical development of selected product candidates; obtaining regulatory approvals and marketing authorizations for product candidates for which we complete clinical trials; developing a sustainable and scalable manufacturing process for product candidates; launching and commercializing product candidates for which we obtain regulatory approvals and marketing authorizations, either directly or with a collaborator or distributor; obtaining market acceptance of our product candidates; addressing any competing technological and market developments; negotiating favorable terms in any collaboration, licensing, or other arrangements into which we may enter; maintaining good relationships with our collaborators and licensors; 96 maintaining, protecting, and expanding our portfolio of IP rights, including patents, trade secrets, and know-how; and attracting, hiring, and retaining qualified personnel.
Property Leases – Not Yet Commenced In February 2022, we entered into a lease agreement for office, general laboratory and good manufacturing practice (“GMP”) manufacturing space at 840 Winter Street in Waltham, Massachusetts, which is described in further detail in Note 12 of the consolidated financial statements included in this Annual Report on Form 10-K.
Property Leases – Not Yet Commenced In February 2022, we entered into a lease agreement for office, general laboratory and planned good manufacturing practice (“GMP”) manufacturing space at 840 Winter Street in Waltham, Massachusetts, which is described in further detail in Note 12 of the consolidated financial statements included in this Annual Report on Form 10-K.
Net cash provided by (used in) investing activities During the year ended December 31, 2022, our investing activities provided net cash of $160.3 million primarily due to $647.6 million in marketable securities maturing, offset in part by $429.0 million of marketable securities purchased, $44.8 million in net cash for the acquisition of Rewrite, and $13.6 million in cash for the purchase of property and equipment.
During the year ended December 31, 2022, our investing activities provided net cash of $160.3 million primarily due to $647.6 million in marketable securities maturing, offset in part by $429.0 million of marketable securities purchased, $44.8 million in net cash for the acquisition of Rewrite, and $13.6 million in cash for the purchase of property and equipment.
Additionally, we are eligible to earn milestone payments and royalties, in each case, on a per-product basis under our collaborations with Novartis, SparingVision and ONK, on a per-target basis under our collaboration with Regeneron, and upon achievement of certain events with Kyverna, subject to the provisions of our agreements with each of them.
Additionally, we are eligible to earn milestone payments and royalties, in each case, on a per-product basis under our collaborations with SparingVision and ONK, on a per-target basis under our collaboration with Regeneron, and upon achievement of certain events with Kyverna, subject to the provisions of our agreements with each of them.
To achieve this core principle, we apply the following five steps: (i) identify the contract with the customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when or as we satisfy a performance obligation.
To achieve this core principle, we apply the following five steps: (i) identify the contract with the customer; (ii) identify the performance obligations in the contract; (iii) determine the 98 transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when or as we satisfy a performance obligation.
Because our lead programs are still in the early clinical stage and the outcome of these efforts is uncertain, we cannot estimate the actual amounts necessary to successfully complete the development and commercialization of any future product candidates or whether, or when, we may achieve profitability.
Because our lead programs are in the clinical stage and the outcome of these efforts is uncertain, we cannot estimate the actual amounts necessary to successfully complete the development and commercialization of any future product candidates or whether, or when, we may achieve profitability.
As of December 31, 2022, our only revenue recognized is related to collaboration agreements with third parties which are either within the scope of ASC 606, under which we license certain rights to our product candidates to third parties, or within the scope of ASC 808, Collaborative Arrangements (“ASC 808”) if it involves a joint operating activity pursuant to which we are an active participant and are exposed to significant risks and rewards with respect to the arrangement.
As of December 31, 2023, our revenue recognized is solely related to collaboration agreements with third parties which are either within the scope of ASC 606, under which we license certain rights to our product candidates to third parties, or within the scope of ASC 808, Collaborative Arrangements (“ASC 808”) if it involves a joint operating activity pursuant to which we are an active participant and are exposed to significant risks and rewards with respect to the arrangement.
During the year ended December 31, 2022, we issued 3,395,339 shares of our common stock in a series of sales at an average price of $57.43 per share in accordance with the 2022 Sale Agreement, for aggregate net proceeds of $189.0 million after payment of cash commissions to Jefferies and approximately $0.1 million related to legal, accounting and other fees in connection with the sales.
During the year ended December 31, 2022, we issued 3,395,339 shares of our common stock, in a series of sales, at an average price of $57.43 per share, in accordance with the 2022 Sale Agreement for aggregate net proceeds of $189.0 million, after payment of cash commissions and legal, accounting and other fees in connection with the sales.
During the first quarter of 2022, we issued 579,788 shares of our common stock in a series of sales at an average price of $69.43 per share in accordance with the 2019 Sale Agreement, for aggregate net proceeds of $38.9 million after payment of cash commissions to Jefferies and approximately $0.2 million related to legal, accounting and other fees in connection with the sales.
During the first quarter of 2022, we issued 579,788 shares of our common stock in a series of sales at an average price of $69.43 per share in accordance with the 2019 Sale Agreement, for aggregate net proceeds of $38.9 million after payment of cash commissions and legal, accounting and other fees in connection with the sales.
Liquidity and Capital Resources Since our inception through December 31, 2022, we have raised an aggregate of $2,395.2 million to fund our operations through our collaboration agreements, our initial public offering and concurrent private placements, follow-on public offerings, at-the-market offerings and the sale of convertible preferred stock.
Liquidity and Capital Resources Since our inception through December 31, 2023, we have raised an aggregate of $2,534.1 million to fund our operations through our collaboration agreements, our initial public offering and concurrent private placements, follow-on public offerings, at-the-market offerings and the sale of convertible preferred stock.
Outlook Based on our research and development plans and our expectations related to the progress of our programs, we expect that our cash, cash equivalents and marketable securities as of December 31, 2022, as well as research and cost reimbursement funding from our collaboration agreements will enable us to fund our ongoing operating expenses and capital expenditure requirements beyond the next 24 months, excluding any potential milestone payments or extension fees that could be earned and distributed under our collaboration agreements or any strategic use of capital not currently in the base case planning assumptions.
Outlook Based on our research and development plans and our expectations related to the progress of our programs, we expect that our cash, cash equivalents and marketable securities as of December 31, 2023, as well as research and cost reimbursement funding from our collaboration agreements will enable us to fund our ongoing operating expenses and capital expenditure requirements into mid-2026, excluding any potential milestone payments or extension fees that could be earned and distributed under our collaboration agreements or any strategic use of capital not currently in the base case planning assumptions.
Contractual and Other Obligations We have entered into arrangements that contractually obligate us to make payments that will affect our liquidity and cash flows in future periods . Property Leases - Commenced As of December 31, 2022, our contractual commitments for leases were $170.4 million, which will be paid over the term of such leases.
Contractual and Other Obligations We have entered into arrangements that contractually obligate us to make payments that will affect our liquidity and cash flows in future periods . 97 Property Leases - Commenced As of December 31, 2023, our contractual commitments for leases were $146.5 million, which will be paid over the term of such leases.
During 2023, we expect our expenses to increase compared to prior periods in connection with our ongoing activities as we continue to grow our research and development team, develop our clinical programs and advance additional programs into clinical development.
During 2024, we expect our expenses to increase compared to prior periods in connection with our ongoing activities as we continue to develop our clinical programs and advance additional programs into clinical development.
Management Overview Intellia Therapeutics, Inc. (“we,” “us,” “our,” “Intellia,” or the “Company”) is a leading clinical-stage genome editing company, focused on developing potentially curative therapeutics using CRISPR/Cas9-based technologies.
(“we,” “us,” “our,” “Intellia,” or the “Company”) is a leading clinical-stage gene editing company, focused on developing potentially curative therapeutics using CRISPR/Cas9-based technologies.
In determining the accounting for each contract, the significant areas of management judgment or estimation include determining the transaction price, identifying the distinct performance obligations within a contract, determining the standalone selling prices for distinct performance obligations when more than one distinct performance obligation is 101 identified within a contract and determining the revenue recognition pattern for each performance obligation that best reflects the timing of when we transfer control of goods and services to the customer.
In determining the accounting for each contract, the significant areas of management judgment or estimation include the determination of accounting for contract changes as modifications and whether those are separate and distinct or part of a partially satisfied performance obligation, determining the transaction price, identifying the distinct performance obligations within a contract, determining the standalone selling prices for distinct performance obligations when more than one distinct performance obligation is identified within a contract and determining the revenue recognition pattern for each performance obligation that best reflects the timing of when we transfer control of goods and services to the customer.
To fully realize the transformative potential of CRISPR/Cas9-based technologies, we are building a full-spectrum genome editing company, by leveraging our modular platform, to advance in vivo a nd ex vivo therapies for diseases with high unmet need by pursuing two primary approaches.
To fully realize the transformative potential of CRISPR/Cas9-based technologies, we are building a full-spectrum gene editing company, by leveraging our modular platform, to advance in vivo and ex vivo therapies for diseases with high unmet need by pursuing two primary approaches. For in vivo applications to address genetic diseases, we deploy CRISPR/Cas9 as the therapy.
Information pertaining to fiscal year 2020 was included in our Annual Report on Form 10-K for the year ended December 31, 2021 on pages 101 through 109 under Part II, Item 7, “Management’s Discussion and Analysis of Financial Position and Results of Operations,” which was filed with the Securities and Exchange Commission (the “SEC”) on February 24, 2022.
Information pertaining to fiscal year 2021 was included in our Annual Report on Form 10-K for the year ended December 31, 2022 under Part II, Item 7, “Management’s Discussion and Analysis of Financial Position and Results of Operations,” which was filed with the Securities and Exchange Commission (the “SEC”) on February 23, 2023. Management Overview Intellia Therapeutics, Inc.
Research and Development Research and development expenses increased by $190.2 million to $420.0 million during the year ended December 31, 2022, as compared to $229.8 million during the year ended December 31, 2021. 96 The following table summarizes our research and development expenses for the years ended December 31, 2022 and 2021, together with the changes in those items in dollars (in thousands) and the respective percentages of change.
Research and Development Research and development expenses increased by $15.1 million to $435.1 million during the year ended December 31, 2023, as compared to $420.0 million during the year ended December 31, 2022. 93 The following table summarizes our research and development expenses 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.
We agreed to pay to Jefferies cash commissions of 3.0% of the gross proceeds of sales of common stock under the 2019 Sale Agreement.
We agreed to pay cash commissions of 3.0% of the gross proceeds of sales of common stock under the 2019 Sale Agreement. Under the 2019 Sale Agreement, we issued 3,778,889 shares of our common stock.
Until such time as we can generate substantial product revenues, if ever, we expect to finance our ongoing cash needs through equity financings and collaboration arrangements. We receive cost reimbursements from Regeneron for the ATTR and hemophilia programs.
Until such time as we can generate substantial product revenues, if ever, we expect to fund our ongoing cash needs through equity financings and collaboration arrangements. We receive cost reimbursements from Regeneron related to our collaboration agreements with them.
For equity awards that have a performance condition, we recognize stock-based compensation expense using the accelerated attribution method, based on our assessment of the probability that the performance condition will be achieved. Our stock price is a key input that will drive the grant date fair value of the equity awards.
Estimates of stock-based compensation expense for an award with a performance condition are based on our assessment of the probability that the performance condition will be achieved. Our stock price is a key input that will drive the grant date fair value of the equity awards.
General and Administrative General and administrative expenses increased by $19.2 million to $90.3 million during the year ended December 31, 2022, compared to $71.1 million during the year ended December 31, 2021.
General and Administrative General and administrative expenses increased by $26.2 million to $116.5 million during the year ended December 31, 2023, compared to $90.3 million during the year ended December 31, 2022.
During 2023, we expect research and development expenses to increase as we continue to grow our development team, initiate global pivotal trials for NTLA-2001 and NTLA-2002, progress our NTLA-3001 and NTLA-2003 programs and nominate new development candidates.
During 2024, we expect research and development expenses to increase as we advance our global pivotal trials for NTLA-2001 and NTLA-2002, progress our NTLA-3001 program and nominate new development candidates.
In January 2023, a research milestone related to Rewrite was achieved and settled (see Note 11). 100 Critical Accounting Policies and Use of Estimates Our management’s discussion and analysis of financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the U.S.
Critical Accounting Policies and Use of Estimates Our management’s discussion and analysis of financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the U.S.
Research and Development Research and development costs consist of expenses incurred in performing research and development activities, such as compensation and benefits, which includes equity-based compensation, for full-time research and development employees, allocated facility-related expenses, overhead expenses, license and milestone fees, contract research, development and manufacturing services, clinical trial costs and other related costs. 95 General and Administrative General and administrative expenses consist primarily of compensation and benefits, including equity-based compensation, for our executive, finance, legal, human resources, business development and support functions.
Research and Development Research and development costs consist of expenses incurred in performing research and development activities, such as compensation and benefits, which includes stock-based compensation, for full-time research and development employees, allocated facility-related expenses, overhead expenses, license and milestone fees, contract research, development and manufacturing services, clinical trial costs and other related costs.
Equity-based compensation expense is recognized on a straight-line basis over the requisite service period of the awards and is adjusted for pre-vesting forfeitures in the period in which the forfeitures occur.
Stock-based compensation expense is recognized on a straight-line basis over the requisite service period of the awards and is adjusted for pre-vesting forfeitures in the period in which the forfeitures occur. For equity awards that have a performance or market condition, we recognize stock-based compensation expense using the accelerated attribution method.
Net cash provided by financing activities of $736.7 million during the year ended December 31, 2021 is primarily due to the receipt of $648.3 million in net proceeds from a follow-on offering of our common stock, $45.3 million in net proceeds from at-the-market offerings, $41.1 million in cash received from the exercise of stock options and $2.0 million in cash received from the issuance of shares through our employee stock purchase plan.
Net cash provided by financing activities Net cash provided by financing activities of $130.3 million during the year ended December 31, 2023 is primarily due to the receipt of $119.8 million in net proceeds from at-the-market offerings, $6.6 million in cash received from the exercise of stock options and $3.9 million in cash received from the issuance of shares through our employee stock purchase plan.
We agreed to pay to Jefferies cash commissions of 3.0% of the gross proceeds of sales of common stock under the 2022 Sale Agreement.
We agreed to pay cash commissions of 3.0% of the gross proceeds of sales of common stock under the 2022 Sale Agreement. Through December 31, 2023 we have issued 7,518,163 shares of our common stock under the 2022 Sale Agreement.
This increase was primarily related to an increase in employee-related expenses, including stock-based compensation of $14.8 million. 97 Other (Expense) Income, Net The increase in other (expense) income of $16.0 million is primarily related to an increase in the fair value of our contingent consideration liability of $13.5 million and an increase in our share of AvenCell's losses of $9.8 million, offset in part by a $7.3 million increase in interest income.
This increase was primarily related to an increase in employee-related expenses, including stock-based compensation of $16.7 million. 94 Other Income (Expense), Net The increase in other income (expense), net of $50.1 million is primarily related to a $41.3 million increase in interest income, driven by an increase in market rates, and a $13.4 million decrease in other expense related to the change in fair value of contingent consideration, offset in part by a $4.6 million increase in the loss from our equity method investment.
Follow-on Offering In December 2022, we closed an underwritten public offering of 7,532,751 shares of common stock, including the exercise in full of the underwriters’ option to purchase an additional 982,532 shares of common stock, at the public offering price of $45.80 per share, for aggregate net proceeds of $337.9 million, after deducting the underwriting discount, commissions and approximately $0.3 million related to legal, accounting and other fees in connection with the sales.
Follow-on Offering In December 2022, we closed an underwritten public offering of 7,532,751 shares of common stock, including the exercise in full of the underwriters’ option to purchase an additional 982,532 shares of common stock, at the public offering price of $45.80 per share, for aggregate net proceeds of $337.9 million, after deducting the underwriting discount, commissions and legal, accounting and other fees in connection with the sales. 95 Funding Requirements Our primary uses of capital are, and we expect will continue to be, research and development research materials and contracted services, clinical trial costs, compensation and related expenses, laboratory and office facilities, research supplies, legal and regulatory expenses, patent prosecution filing and maintenance costs for our licensed IP, milestone and royalty payments and general overhead costs.
We have based this estimate on current assumptions that may prove to be wrong, and we could use our capital resources sooner than we expect.
We have based this estimate on current assumptions that may prove to be wrong, and we could use our capital resources sooner than we expect. In January 2024, following an internal strategic review, we announced an effort to streamline company-wide operations to further focus resources on key strategic priorities and programs.
There may be instances in which payments made to our vendors will exceed the level of services provided and result in a prepayment of the expense.
There may be instances in which payments made to our vendors will exceed the level of services provided and result in a prepayment of the expense. 99 Stock-Based Compensation We measure employee stock-based compensation based on the grant date fair value of the equity awards using the Black-Scholes option pricing model.
(“ONK”), on a per-target basis under our collaboration with Regeneron Pharmaceuticals, Inc. (“Regeneron”) and upon achievement of certain events under our collaboration with Kyverna. Our ability to earn these milestone payments and the timing of achieving these milestones is dependent upon the outcome of our research and development activities and is uncertain at this time.
Our ability to earn these milestone payments and the timing of achieving these milestones is dependent upon the outcome of our research and development activities and is uncertain at this time. Our rights to payments under our collaboration agreements are our only committed external source of funds.
Comparison of Years Ended December 31, 2022 and 2021 The following table summarizes our results of operations for the years ended December 31, 2022 and 2021 (in thousands): Year Ended December 31, Period-to- 2022 2021 Period Change Collaboration revenue $ 52,121 $ 33,053 $ 19,068 Operating expenses: Research and development 419,979 229,807 190,172 General and administrative 90,306 71,096 19,210 Total operating expenses 510,285 300,903 209,382 Operating loss (458,164 ) (267,850 ) (190,314 ) Other (expense) income, net: Interest income 8,542 1,283 7,259 Loss from equity method investment (11,079 ) (1,325 ) (9,754 ) Change in fair value of contingent consideration (13,485 ) - (13,485 ) Total other (expense) income, net (16,022 ) (42 ) (15,980 ) Net loss $ (474,186 ) $ (267,892 ) $ (206,294 ) Collaboration Revenue Collaboration revenue increased by $19.1 million to $52.1 million during the year ended December 31, 2022, as compared to $33.1 million during the year ended December 31, 2021.
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 (in thousands): Year Ended December 31, Period-to- 2023 2022 Period Change Collaboration revenue $ 36,275 $ 52,121 $ (15,846 ) Operating expenses: Research and development 435,069 419,979 15,090 General and administrative 116,497 90,306 26,191 Total operating expenses 551,566 510,285 41,281 Operating loss (515,291 ) (458,164 ) (57,127 ) Other income (expense), net: Interest income 49,832 8,542 41,290 Loss from equity method investment (15,633 ) (11,079 ) (4,554 ) Change in fair value of contingent consideration (100 ) (13,485 ) 13,385 Total other income (expense), net 34,099 (16,022 ) 50,121 Net loss $ (481,192 ) $ (474,186 ) $ (7,006 ) Collaboration Revenue Collaboration revenue decreased by $15.8 million to $36.3 million during the year ended December 31, 2023, as compared to $52.1 million during the year ended December 31, 2022.
Also included in general and administrative expenses are allocated facility-related costs not otherwise included in research and development expenses, travel expenses and professional fees for auditing, tax and legal services, including IP-related legal services, and other consulting fees and expenses.
Also included in general and administrative expenses are allocated facility-related costs not otherwise included in research and development expenses, travel expenses and professional fees for auditing, tax and legal services, including IP-related legal services, and other consulting fees and expenses. 92 Other Income (Expense), Net Other income (expense) consists of interest income earned on our cash, cash equivalents, restricted cash equivalents and marketable securities, loss from equity method investment and change in fair value of contingent consideration.
We classify equity-based compensation expense in our consolidated statements of operations and comprehensive loss in the same manner in which the award recipient’s salary and related costs are classified or in which the award recipient’s service payments are classified. 102 Recent Accounting Pronouncements Please read Note 2 to our consolidated financial statements included in Part IV, Item 15, “Notes to Consolidated Financial Statements,” of this Annual Report on Form 10-K for a description of recent accounting pronouncements applicable to our business.
Recent Accounting Pronouncements Refer to Note 2 to our consolidated financial statements included in Part IV, Item 15, “Notes to Consolidated Financial Statements,” of this Annual Report on Form 10-K for a description of recent accounting pronouncements applicable to our business.
For in vivo applications to address genetic diseases, we deploy CRISPR/Cas9 as the therapy that targets cells within the body. In parallel, we are developing ex vivo applications to address immuno-oncology and autoimmune diseases, where we use CRISPR/Cas9 as the tool to create the engineered cell therapy.
Our in vivo programs use CRISPR to enable precise editing of disease-causing genes directly inside the human body. In addition, we are advancing ex vivo applications to address immuno-oncology and autoimmune diseases, where we use CRISPR/Cas9 as the tool to create the engineered cell therapy. For our ex vivo programs, CRISPR/Cas9 is used to engineer human cells outside the body.
As of December 31, 2022, we had $1,262.0 million in cash, cash equivalents and marketable securities. We are eligible to earn a significant amount of milestone payments and royalties, in each case, on a per-product basis under our collaborations with Novartis Institutes for BioMedical Research, Inc. (“Novartis”), SparingVision SAS (“SparingVision”) and ONK Therapeutics, Ltd.
We are eligible to earn a significant amount of milestone payments and royalties, in each case, on a per-product basis under our collaborations with SparingVision SAS (“SparingVision”) and ONK Therapeutics, Ltd. (“ONK”), on a per-target basis under our collaboration with Regeneron Pharmaceuticals, Inc. (“Regeneron”) and upon achievement of certain events under our collaboration with Kyverna Therapeutics, Inc. (“Kyverna”).
In connection therewith, we have committed to making at least $146.0 million in rental payments over a lease term of 144 months estimated to begin in 2024. Other Obligations We enter into contracts in the normal course of business with various third parties for clinical trials, preclinical research studies, supply manufacturing and other services and products for operating purposes.
In connection therewith, we have committed to making at least $146.0 million in rental payments over a lease term of 144 months estimated to begin in the second half of 2024.
Cash Flows The following is a summary of cash flows for the years ended December 31, 2022 and 2021: Year Ended December 31, 2022 2021 (In millions) Net cash used in operating activities $ (333.3 ) $ (225.0 ) Net cash provided by (used in) investing activities 160.3 (550.8 ) Net cash provided by financing activities 583.0 736.7 99 Net cash used in operating activities Net cash used in operating activities of $333.3 million during the year ended December 31, 2022 primarily reflects the increased spend in our research and development activities, offset by the receipt of $10.7 million in payments from our collaboration partners during that period.
Cash Flows The following is a summary of cash flows for the years ended December 31, 2023 and 2022: Year Ended December 31, 2023 2022 (In thousands) Net cash used in operating activities $ (394,086 ) $ (333,287 ) Net cash (used in) provided by investing activities (31,347 ) 160,309 Net cash provided by financing activities 130,323 582,955 Net cash used in operating activities Net cash used in operating activities of $394.1 million during the year ended December 31, 2023 primarily consists of a net loss of $481.2 million, further reduced by changes in operating assets and liabilities of $52.5 million, including the receipt of $18.7 million in payments from our collaboration partners during that period and offset in part by non-cash charges of stock-based compensation of $134.1 million, loss on equity method investment of $22.3 million and depreciation of $9.0 million.
Net cash used in operating activities of $225.0 million during the year ended December 31, 2021 primarily reflects increased spend in our research and development activities offset by the receipt of $6.7 million in payments from our collaboration partners during that period.
Net cash used in operating activities of $333.3 million during the year ended December 31, 2022 primarily consists of a net loss of $474.2 million, further reduced by changes in operating assets and liabilities of $53.9 million, including the receipt of $10.7 million in payments from our collaboration partners during that period and offset in part by non-cash charges of stock-based compensation of $91.4 million, in-process research and development expense of $56.0 million, losses on equity method investment of $22.5 million and depreciation of $7.6 million.
The increase in the year ended December 31, 2021 is primarily due to marketable securities activity during the period, as $1,020.6 million in marketable securities were purchased and $485.6 million in marketable securities matured, as well as the use of $12.8 million in cash for the purchase of property and equipment and $3.0 million for an investment in Kyverna.
Net cash (used in) provided by investing activities During the year ended December 31, 2023, our investing activities used cash of $31.3 million primarily due to $904.5 million of marketable securities purchased and $14.0 million in cash for the purchase of property and equipment, offset in part by $887.1 million in marketable securities maturing.
Removed
Other (Expense) Income, Net Other (expense) income consists of interest income earned on our cash, cash equivalents, restricted cash equivalents and marketable securities, loss from equity method investment and change in fair value of contingent consideration.
Added
General and Administrative General and administrative expenses consist primarily of compensation and benefits, including stock-based compensation, for our executive, finance, legal, human resources, business development and support functions.
Removed
The increase in collaboration revenue during the year ended December 31, 2022 is primarily due to revenue from our joint venture with AvenCell Therapeutics, Inc. (“AvenCell”) and revenue from our license and collaboration agreement with Kyverna Therapeutics, Inc. (“Kyverna”). Refer to Note 9 to our consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K for further details.
Added
This decrease was primarily driven by a $10.3 million cumulative adjustment related to a contract modification resulting from Regeneron exercising a one-time option to extend the term of our technology collaboration for an additional two years. Refer to Note 9 to our consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K for further details.
Removed
(“Rewrite”); • a $10.7 million increase in facility-related expenses primarily related to rent, depreciation and technology expense allocated to research and development; and • a $29.6 million increase in stock-based compensation driven by our larger workforce.
Added
As of December 31, 2023, we had $1,012.1 million in cash, cash equivalents and marketable securities.
Removed
Our rights to payments under our collaboration agreements are our only committed external source of funds.
Added
During the year ended December 31, 2023, we issued 4,122,824 shares of our common stock, in a series of sales, at an average price of $30.57 per share, in accordance with the 2022 Sale Agreement for aggregate net proceeds of $121.9 million, after payment of cash commissions and legal, accounting and other fees in connection with the sales.
Removed
As of December 31, 2022, $205.0 million in shares of common stock remain eligible for sale under the 2022 Sale Agreement. 98 Funding Requirements Our primary uses of capital are, and we expect will continue to be, research and development research materials and contracted services, clinical trial costs, compensation and related expenses, laboratory and office facilities, research supplies, legal and regulatory expenses, patent prosecution filing and maintenance costs for our licensed IP, milestone and royalty payments and general overhead costs.
Added
As of December 31, 2023, $2.1 million of these proceeds are included in “Prepaid expenses and other current assets” on our consolidated balance sheet, representing offerings with trade dates in December 2023 that were settled in January 2024.
Removed
During the year ended December 31, 2021, our investing activities used net cash of $550.8 million.
Added
These changes resulted in a pause of select exploratory research-stage programs and a workforce reduction of approximately 15%.
Removed
As of December 31, 2022, we have $8.0 million of commitments that are legally enforceable and due within one year.
Added
Other Obligations We enter into contracts in the normal course of business with various third parties for clinical trials, preclinical research studies, supply manufacturing and other services and products for operating purposes. These contracts are generally cancelable at any time by us upon prior written notice.
Removed
Contingent Consideration Liability As discussed in Notes 2, 4 and 11 to our consolidated financial statements of this Annual Report on Form 10-K, during the year ended December 31, 2022, we entered into the Rewrite Merger Agreement.
Added
In January 2023, a research milestone related to Rewrite was achieved and settled (see Note 11 of the consolidated financial statements included in this Annual Report on Form 10-K ).
Removed
Under the Rewrite Merger Agreement, the Rewrite Holders are eligible to receive a $25.0 million research milestone payment, payable in a combination of cash and our common stock.
Added
Significant judgments made with respect to stock-based compensation relate to certain assumptions made when selecting model inputs used in the Black-Scholes option pricing model, in particular the volatility and expected life assumptions. Volatility assumptions are calculated based on historical volatility of the Company’s stock. We estimate the expected term of options using the simplified method.
Removed
We account for contingent consideration identified in an asset acquisition that is settled in shares of common stock under ASC 480, Distinguishing Liabilities from Equity (“ASC 480”), which results in us applying judgment in estimating the fair value of the liability at the end of each reporting period.
Added
In addition, an expected dividend yield of zero is used in the option valuation model because we do not pay cash dividends and do not expect to pay any cash dividends in the foreseeable future.
Removed
We engaged an independent valuation specialist to determine the fair value of the contingent consideration liability (see Note 4 to our consolidated financial statements for specifics related to the valuation model and inputs utilized). The estimated probability of achievement is a highly sensitive input into the model.
Added
The fair value of market-based restricted stock units is determined using a Monte Carlo simulation model, which uses multiple input variables to determine the probability of satisfying the market condition requirements.
Removed
A 10% decrease in the probability of achievement, keeping all other variables the same, yields a 10% decrease in the earnout liability. Equity-Based Compensation We measure employee equity-based compensation based on the grant date fair value of the equity awards using the Black-Scholes option pricing model.
Added
Stock-based compensation expense for an award with performance conditions also include significant judgment with respect to the probability that the performance condition will be achieved, as the amount of expense recorded is based on the probable outcome of the performance conditions.
Added
We classify stock-based compensation expense in our consolidated statements of operations and comprehensive loss in the same manner in which the award recipient’s salary and related costs are classified or in which the award recipient’s service payments are classified.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

3 edited+0 added−0 removed3 unchanged
Biggest changeAs of December 31, 2022, we had cash equivalents, restricted cash equivalents and marketable securities of $1,273.0 million consisting of interest-bearing money market accounts, reverse repurchase agreements, corporate and financial institution debt securities, U.S. Treasury and other government securities and asset-backed securities.
Biggest changeAs of December 31, 2023, we had cash equivalents, restricted cash equivalents and marketable securities of $921.6 million consisting of interest-bearing money market accounts, corporate and financial institution debt securities, U.S. Treasury and other government securities and asset-backed securities.
Financial Statement s and Supplementary Data The information required by this item is presented at the end of this report beginning on page F-1. Item 9. Changes in and Disagreements with Accou ntants on Accounting and Financial Disclosure None.
Financial Statement s and Supplementary Data The information required by this item is presented at the end of this report beginning on page F-1. Item 9. Changes in and Disagreements with Accou ntants on Accounting and Financial Disclosure None. 100
We do not have any foreign currency or derivative financial instruments. Inflation generally affects us by increasing our cost of labor, preclinical and clinical trial costs. We do not believe that inflation had a material effect on our results of operations during the year ended December 31, 2022. Item 8.
We do not have any foreign currency or derivative financial instruments. Inflation generally affects us by increasing our cost of labor, preclinical and clinical trial costs. We do not believe that inflation had a material effect on our results of operations during the year ended December 31, 2023. Item 8.

Other NTLA 10-K year-over-year comparisons