Core Insights - Precision BioSciences, Inc. is a clinical stage gene editing company focused on developing in vivo gene editing therapies for diseases with high unmet needs [1] - The company presented clinical data from the Phase 1 ELIMINATE-B trial of PBGENE-HBV targeting chronic Hepatitis B patients [1] - The presentation took place at the International Coalition to Eliminate HBV (ICE-HBV) "HBV Cure Symposium" in Berlin [1]

Core Insights - Precision BioSciences has announced the issuance of a U.S. patent for its lead in vivo gene editing program PBGENE-HBV, which is aimed at treating chronic hepatitis B, with patent protection extending to March 2042 [1][2] - The Phase 1 ELIMINATE-B trial is progressing, with dosing for Cohort 3 initiated in Q3 2025, focusing on determining the optimal dose and administration schedule for the treatment [2][4] Company Overview - Precision BioSciences is a clinical stage gene editing company utilizing its proprietary ARCUS platform to develop therapies for diseases with high unmet needs [1][6] - The company aims to deliver lasting cures for a range of genetic and infectious diseases where no adequate treatments exist [6][7] Product and Program Details - PBGENE-HBV is the first and only potentially curative gene editing program specifically designed to eliminate covalently closed circular DNA (cccDNA) and inactivate integrated HBV DNA [3][4] - The program is currently in a global first-in-human clinical trial, with an estimated 300 million people worldwide suffering from chronic hepatitis B [3] Clinical Trial Information - The ELIMINATE-B trial is enrolling HBeAg-negative chronic hepatitis B patients at sites in Moldova, Hong Kong, New Zealand, and soon in the U.S. [4] - The trial's goal is to define the optimal dose and number of administrations for safely eliminating cccDNA and inactivating integrated HBV DNA [4]

Company Performance - Precision BioSciences reported a quarterly loss of $2.13 per share, significantly worse than the Zacks Consensus Estimate of a loss of $0.09, representing an earnings surprise of -2,266.67% [1] - The company posted revenues of $0.02 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 99.87%, compared to revenues of $49.9 million a year ago [2] - Over the last four quarters, Precision BioSciences has not surpassed consensus EPS or revenue estimates [2] Stock Movement and Outlook - Precision BioSciences shares have increased by approximately 26.3% since the beginning of the year, outperforming the S&P 500's gain of 7.9% [3] - The company's earnings outlook will be crucial for future stock performance, with current consensus EPS estimates at -$0.38 on $11 million in revenues for the coming quarter and -$2.77 on $35.7 million in revenues for the current fiscal year [7] Industry Context - The Medical - Biomedical and Genetics industry, to which Precision BioSciences belongs, is currently ranked in the top 41% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - The performance of Precision BioSciences may be influenced by the overall industry outlook, as research shows that the top 50% of Zacks-ranked industries outperform the bottom 50% by more than 2 to 1 [8]

```markdown [Forward-Looking Statements](index=4&type=section&id=FORWARD-LOOKING%20STATEMENTS) This section outlines inherent risks and uncertainties, emphasizing that actual results may differ materially from projections - Forward-looking statements are subject to known and unknown risks, uncertainties, and assumptions, and actual results may differ materially. Key risk areas include profitability, funding, operating expenses, program success, genome-editing technology, clinical trials, regulatory approvals, competition, and intellectual property[11](index=11&type=chunk)[12](index=12&type=chunk)[16](index=16&type=chunk) [Risk Factor Summary](index=6&type=section&id=RISK%20FACTOR%20SUMMARY) The company faces significant operating losses, requires substantial funding, and its novel ARCUS technology presents unpredictable future success - The company has incurred significant operating losses and expects to continue to do so, requiring substantial additional funding. Its limited operating history and the novel ARCUS technology make future success difficult to predict. Key risks include the inability to assess product safety/efficacy, competition, adverse public perception of genome editing, and complex, uncertain regulatory landscape[18](index=18&type=chunk)[19](index=19&type=chunk) [PART I. FINANCIAL INFORMATION](index=8&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This part presents the company's unaudited financial statements and management's discussion and analysis of financial condition [Item 1. Financial Statements (unaudited)](index=8&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) This item includes the company's unaudited condensed financial statements and detailed notes for the reported periods [Condensed Balance Sheets](index=8&type=section&id=Condensed%20Balance%20Sheets) This section presents the company's financial position, detailing assets, liabilities, and stockholders' equity | Metric | Dec 31, 2024 (in thousands) | Jun 30, 2025 (in thousands) | Change (in thousands) | | :-------------------------------- | :-------------------------- | :-------------------------- | :-------------------- | | Cash and cash equivalents | $85,899 | $62,242 | $(23,657) | | Total current assets | $94,989 | $70,259 | $(24,730) | | Total assets | $136,388 | $108,928 | $(27,460) | | Total current liabilities | $14,980 | $13,568 | $(1,412) | | Total liabilities | $79,995 | $74,874 | $(5,121) | | Total stockholders' equity | $56,393 | $34,054 | $(22,339) | [Condensed Statements of Operations](index=9&type=section&id=Condensed%20Statements%20of%20Operations) This section details the company's revenues, expenses, and net income or loss over specific reporting periods | Metric (in thousands) | Q2 2025 | Q2 2024 | Change Q2 | H1 2025 | H1 2024 | Change H1 | | :-------------------- | :------ | :------ | :-------- | :------ | :------ | :-------- | | Revenue | $18 | $49,898 | $(49,880) | $47 | $67,482 | $(67,435) | | Operating expenses | $21,895 | $25,752 | $(3,857) | $44,036 | $47,523 | $(3,487) | | Operating (loss) income | $(21,877) | $24,146 | $(46,023) | $(43,989) | $19,959 | $(63,948) | | Net (loss) income | $(23,520) | $32,749 | $(56,269) | $(44,085) | $41,337 | $(85,422) | | Basic EPS | $(2.13) | $4.70 | $(6.83) | $(4.33) | $6.87 | $(11.20) | | Diluted EPS | $(2.13) | $4.67 | $(6.80) | $(4.33) | $6.81 | $(11.14) | [Condensed Statements of Changes in Stockholders' Equity](index=10&type=section&id=Condensed%20Statements%20of%20Changes%20in%20Stockholders'%20Equity) This section outlines changes in the company's equity accounts, including accumulated deficit and additional paid-in capital | Metric (in thousands) | Dec 31, 2024 | Jun 30, 2025 | Change | | :-------------------- | :----------- | :----------- | :----- | | Total Stockholders' Equity | $56,393 | $34,054 | $(22,339) | | Accumulated Deficit | $(482,464) | $(526,549) | $(44,085) | | Additional Paid-In Capital | $539,808 | $561,554 | $21,746 | [Condensed Statements of Cash Flows](index=11&type=section&id=Condensed%20Statements%20of%20Cash%20Flows) This section reports cash generated and used by the company across operating, investing, and financing activities | Metric (in thousands) | H1 2025 | H1 2024 | Change | | :-------------------- | :------ | :------ | :----- | | Net cash used in operating activities | $(39,323) | $(33,850) | $(5,473) | | Net cash used in investing activities | $(326) | $(54) | $(272) | | Net cash provided by financing activities | $15,987 | $40,797 | $(24,810) | | Net (decrease) increase in cash and cash equivalents | $(23,662) | $6,893 | $(30,555) | | Cash, cash equivalents, and restricted cash — end of period | $84,806 | $123,571 | $(38,765) | [Notes to Condensed Financial Statements](index=13&type=section&id=Notes%20to%20Condensed%20Financial%20Statements) This section provides detailed explanations and additional information supporting the condensed financial statements [NOTE 1: DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=13&type=section&id=NOTE%201%3A%20DESCRIPTION%20OF%20BUSINESS%20AND%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note describes the company's gene editing focus and outlines key accounting policies and operational dependencies - Precision BioSciences is a gene editing company focused on in vivo therapies using its ARCUS platform[29](index=29&type=chunk) - The company's success depends on its ability to raise capital, fund R&D, obtain regulatory approval, commercialize products, generate revenue, and achieve profitability[30](index=30&type=chunk) - The company strategically decided to operate as a single platform company focused on in vivo gene editing therapies, completing the sale of its CAR T infrastructure and licensing azer-cel to Imugene in August **2023**[33](index=33&type=chunk)[34](index=34&type=chunk) [NOTE 2: FAIR VALUE MEASUREMENTS](index=15&type=section&id=NOTE%202%3A%20FAIR%20VALUE%20MEASUREMENTS) This note details the fair value hierarchy and measurements for various assets and liabilities | Asset/Liability (in thousands) | Fair Value (Jun 30, 2025) | Level 1 | Level 2 | Level 3 | | :----------------------------- | :------------------------ | :------ | :------ | :------ | | Money market funds | $14,979 | $14,979 | $— | $— | | Investment in iECURE | $744 | $— | $— | $744 | | Assets held for sale | $140 | $— | $— | $140 | | Final payment fee | $200 | $— | $200 | $— | | Warrant liability | $2,847 | $— | $— | $2,847 | - The investment in iECURE decreased by **$2.5 million** in fair value during the six months ended June **30, 2025**[40](index=40&type=chunk) [NOTE 3: DEBT](index=17&type=section&id=NOTE%203%3A%20DEBT) This note provides details on the company's outstanding term loan and associated interest rates - As of June **30, 2025**, **$22.5 million** was outstanding under the **2024** Term Loan with Banc of California[43](index=43&type=chunk) - The stated interest rate on the **2024** Term Loan was **6.00%**, with an effective interest rate of **6.43%**[42](index=42&type=chunk) [NOTE 4: COMMITMENTS AND CONTINGENCIES](index=17&type=section&id=NOTE%204%3A%20COMMITMENTS%20AND%20CONTINGENCIES) This note outlines the company's accrued contingent liabilities and future minimum lease payment obligations - Contingent liabilities of **$10.0 million** are accrued for the Servier Program Purchase Agreement[47](index=47&type=chunk) | Future Minimum Lease Payments (in thousands) | Amount | | :------------------------------------------- | :----- | | 2025 (remainder of year) | $993 | | 2026 | $2,019 | | 2027 | $2,078 | | 2028 | $2,140 | | 2029 | $1,269 | | Total lease payments | $8,499 | - The company guarantees Imugene's MCAT Lease with a contingent liability of approximately **$3.5 million**[52](index=52&type=chunk) [NOTE 5: STOCKHOLDERS' EQUITY](index=21&type=section&id=NOTE%205%3A%20STOCKHOLDERS'%20EQUITY) This note details changes in stockholders' equity, including common stock issuance and warrant terms - In March **2024**, the company issued **2,500,000 shares** of common stock and warrants, generating approximately **$37.0 million** in net proceeds[56](index=56&type=chunk) - The warrants have a five-year term and an exercise price of **$20.00** per share[56](index=56&type=chunk) [NOTE 6: COLLABORATION AND LICENSE AGREEMENTS](index=21&type=section&id=NOTE%206%3A%20COLLABORATION%20AND%20LICENSE%20AGREEMENTS) This note describes revenue recognition and milestone payments from various collaboration and license agreements - Under the TG License Agreement, the company received an upfront cash payment of **$10.0 million** and is eligible for up to **$288.6 million** in additional milestone payments[58](index=58&type=chunk) | Agreement | Revenue (Q2 2025, in thousands) | Revenue (Q2 2024, in thousands) | Revenue (H1 2025, in thousands) | Revenue (H1 2024, in thousands) | | :-------- | :------------------------------ | :------------------------------ | :------------------------------ | :------------------------------ | | TG License | $0 | $900 | $0 | $8,000 | | Novartis | < $100 | $800 | < $100 | $5,300 | | Prevail | $0 | $48,200 | $0 | $52,700 | - The Prevail Agreement was terminated in the prior year, resulting in no revenue recognized in H1 **2025**[61](index=61&type=chunk) - The fair value of the iECURE equity investment decreased by **$2.5 million** during the three and six months ended June **30, 2025**[62](index=62&type=chunk) [NOTE 7: SHARE-BASED COMPENSATION](index=22&type=section&id=NOTE%207%3A%20SHARE-BASED%20COMPENSATION) This note details the company's share-based compensation expense and unrecognized compensation costs | Metric (in thousands) | H1 2025 | H1 2024 | | :-------------------- | :------ | :------ | | Total Share-based Compensation Expense | $5,758 | $5,834 | | R&D Share-based Compensation | $901 | $1,473 | | G&A Share-based Compensation | $4,857 | $4,361 | - As of June **30, 2025**, there was approximately **$10.0 million** of total unrecognized compensation cost related to unvested stock options and RSUs, expected to be recognized over a weighted-average period of **1.7 years**[69](index=69&type=chunk) [NOTE 8: DISCONTINUED OPERATIONS](index=23&type=section&id=NOTE%208%3A%20DISCONTINUED%20OPERATIONS) This note presents financial information related to the company's historical cell therapy operations as discontinued - The company's historical cell therapy operations are presented as discontinued operations following the August **2023** strategic decision[70](index=70&type=chunk)[71](index=71&type=chunk) | Metric (in thousands) | Jun 30, 2025 | Dec 31, 2024 | | :-------------------- | :----------- | :----------- | | Current liabilities of discontinued operations | $885 | $1,204 | [NOTE 9: ELO TRANSACTION](index=24&type=section&id=NOTE%209%3A%20ELO%20TRANSACTION) This note describes the company's equity ownership in Elo and the financial impact of its Series A-2 financing - The company owned approximately **22%** of Elo's voting shares as of June **30, 2025**, down from **26%** at December **31, 2024**[74](index=74&type=chunk) - A **$2.3 million** gain on dilution was recognized from Elo's Series A-2 financing during H1 **2025**, partially offset by a **$1.6 million** proportionate share of Elo's net loss[74](index=74&type=chunk) [NOTE 10: INCOME TAXES](index=24&type=section&id=NOTE%2010%3A%20INCOME%20TAXES) This note explains the company's estimated effective tax rate and the application of a full valuation allowance - The company estimates a **0% annual effective tax rate** for **2025** due to expected net losses[76](index=76&type=chunk) - A full valuation allowance is applied to net deferred tax assets due to the company's history of losses, indicating that realization of these assets is not probable[77](index=77&type=chunk) [NOTE 11: EARNINGS PER SHARE](index=24&type=section&id=NOTE%2011%3A%20EARNINGS%20PER%20SHARE) This note presents basic and diluted earnings per share, excluding anti-dilutive common stock equivalents | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :----- | :------ | :------ | :------ | :------ | | Basic Net (Loss) Income Per Share | $(2.13) | $4.70 | $(4.33) | $6.87 | | Diluted Net (Loss) Income Per Share | $(2.13) | $4.67 | $(4.33) | $6.81 | - All outstanding common stock equivalents were excluded from diluted EPS calculations for Q2 and H1 **2025** because their inclusion would have been anti-dilutive[80](index=80&type=chunk) [NOTE 12: SEGMENT REPORTING](index=25&type=section&id=NOTE%2012%3A%20SEGMENT%20REPORTING) This note clarifies that the company operates as a single segment focused on its ARCUS platform - The company operates as a single operating segment focused on the discovery and development of therapies using its ARCUS platform[81](index=81&type=chunk) | Expense Category (in thousands) | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :------------------------------ | :------ | :------ | :------ | :------ | | Total Research and Development | $12,768 | $17,225 | $26,356 | $30,568 | | Total General and Administrative | $9,127 | $8,527 | $17,680 | $16,955 | [NOTE 13: WARRANTS](index=27&type=section&id=NOTE%2013%3A%20WARRANTS) This note details the accounting treatment and fair value adjustments for warrants issued in the March 2024 Public Offering - Warrants issued in the March **2024** Public Offering are classified as a liability and remeasured at fair value each reporting period[87](index=87&type=chunk) | Metric (in thousands) | Dec 31, 2024 | Mar 31, 2025 | Jun 30, 2025 | | :-------------------- | :----------- | :----------- | :----------- | | Warrant liability | $2,796 | $3,600 | $2,848 | - The fair value adjustment for the three months ended June **30, 2025**, was a gain of **$0.8 million**, while for the six months ended June **30, 2025**, it was a loss of **$0.1 million**[24](index=24&type=chunk)[87](index=87&type=chunk) [NOTE 14: SUBSEQUENT EVENTS](index=29&type=section&id=NOTE%2014%3A%20SUBSEQUENT%20EVENTS) This note describes post-period events, including operating efficiencies and clinical trial advancements - The company initiated operating efficiencies in July **2025** to reduce annual operating expenses and extend its cash runway[90](index=90&type=chunk) - The ELIMINATE-B clinical trial is expanding to higher dose levels, and an IND/CTA filing for the PBGENE-DMD program is being prepared[90](index=90&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=30&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial condition, results, ARCUS platform focus, clinical program progress, liquidity, and capital resources [Overview](index=30&type=section&id=Overview) This section summarizes the company's in vivo gene editing focus, key clinical programs, and recent operational efficiency initiatives - The company is a clinical-stage gene editing company focused on in vivo therapies using its ARCUS platform for genetic and infectious diseases[92](index=92&type=chunk)[93](index=93&type=chunk) - PBGENE-HBV, a wholly-owned in vivo gene editing program for chronic Hepatitis B, is in a global first-in-human clinical trial (ELIMINATE-B). Cohort **1** showed substantial HBsAg reduction (**56%**, **69%**, **47%**) and was well-tolerated. Cohort **2** also showed a favorable safety profile[94](index=94&type=chunk)[96](index=96&type=chunk)[97](index=97&type=chunk)[98](index=98&type=chunk) - PBGENE-DMD, targeting Duchenne Muscular Dystrophy, received Rare Pediatric Disease and Orphan Drug designations. Preclinical data showed significant, durable functional improvement in a humanized DMD mouse model. An IND/CTA filing is targeted by the end of **2025**[100](index=100&type=chunk)[101](index=101&type=chunk)[102](index=102&type=chunk)[103](index=103&type=chunk) - Development of PBGENE-3243 for m.**3243** associated mitochondrial disease has been paused to prioritize PBGENE-HBV and PBGENE-DMD[105](index=105&type=chunk) - The company initiated an operating efficiency program in July **2025**, including expense reductions, to extend its cash runway to the **second half of 2027**[104](index=104&type=chunk) [Components of Our Results of Operations](index=32&type=section&id=Components%20of%20Our%20Results%20of%20Operations) This section explains the primary drivers of the company's revenue, operating expenses, and other income/expense items - Revenue is primarily derived from collaboration and license agreements, with no product sales to date[108](index=108&type=chunk) - Research and development expenses are expensed as incurred and are expected to decrease in the short-term (**2026-2027**) due to cost reduction initiatives, but increase over the long term[109](index=109&type=chunk)[110](index=110&type=chunk) - General and administrative expenses include salaries, consulting fees, legal fees, and facility-related costs[115](index=115&type=chunk) - Other income/expense items include gains/losses from equity method investments (e.g., Elo), changes in fair value of assets/liabilities (e.g., iECURE investment, warrant liability), interest expense, interest income, and loss on disposal of assets[116](index=116&type=chunk)[117](index=117&type=chunk)[119](index=119&type=chunk)[120](index=120&type=chunk)[121](index=121&type=chunk)[122](index=122&type=chunk) [Results of Operations](index=34&type=section&id=Results%20of%20Operations) This section analyzes the company's financial performance over specific reporting periods, detailing changes in revenue and expenses [Comparison of the Three Months Ended June 30, 2025 and June 30, 2024](index=34&type=section&id=Comparison%20of%20the%20Three%20Months%20Ended%20June%2030%2C%202025%20and%20June%2030%2C%202024) This section compares the company's financial results for the second quarter of 2025 against the same period in 2024 | Metric (in thousands) | Q2 2025 | Q2 2024 | Change | | :-------------------- | :------ | :------ | :----- | | Revenue | $18 | $49,898 | $(49,880) | | Total operating expenses | $21,895 | $25,752 | $(3,857) | | Net (loss) income | $(23,520) | $32,749 | $(56,269) | - The **$49.9 million** decrease in Q2 revenue was primarily due to the conclusion of the Prevail Therapeutics Agreement (**$48.2 million** in prior period), and decreases from TG License (**$0.9 million**) and Novartis (**$0.8 million**) agreements[124](index=124&type=chunk) - R&D expenses decreased by **$4.5 million**, driven by a **$7.3 million** decrease in PBGENE-HBV and PBGENE-3243 programs, partially offset by a **$4.0 million** increase in PBGENE-DMD[126](index=126&type=chunk)[127](index=127&type=chunk) - General and administrative expenses increased by **$0.6 million** due to higher employee-related costs[128](index=128&type=chunk) - Loss on changes in fair value was **$2.5 million** in Q2 **2025** (due to iECURE investment) compared to a gain of **$0.7 million** in Q2 **2024** (due to Imugene Convertible Note)[130](index=130&type=chunk) - Gain on change in fair value of warrant liability decreased from **$7.8 million** in Q2 **2024** to **$0.8 million** in Q2 **2025**[131](index=131&type=chunk) [Comparison of the Six Months Ended June 30, 2025 and June 30, 2024](index=36&type=section&id=Comparison%20of%20the%20Six%20Months%20Ended%20June%2030%2C%202025%20and%20June%2030%2C%202024) This section compares the company's financial results for the first half of 2025 against the same period in 2024 | Metric (in thousands) | H1 2025 | H1 2024 | Change | | :-------------------- | :------ | :------ | :----- | | Revenue | $47 | $67,482 | $(67,435) | | Total operating expenses | $44,036 | $47,523 | $(3,487) | | Net (loss) income | $(44,085) | $41,337 | $(85,422) | - The **$67.4 million** decrease in H1 revenue was primarily due to the conclusion of the Prevail Therapeutics Agreement (**$52.7 million** in prior period) and decreases from TG License and Novartis agreements (**$9.5 million** and **$5.3 million**, respectively)[136](index=136&type=chunk) - R&D expenses decreased by **$4.2 million**, driven by a **$7.8 million** decrease in PBGENE-HBV and a **$2.7 million** decrease in platform development, partially offset by a **$6.3 million** increase in PBGENE-DMD[137](index=137&type=chunk)[138](index=138&type=chunk) - General and administrative expenses increased by **$0.7 million** due to a **$1.1 million** increase in employee-related costs[139](index=139&type=chunk) - Gain from equity method investment was **$0.7 million** in H1 **2025** (driven by a **$2.3 million** gain on dilution from Elo's Series A-2 financing, offset by **$1.6 million** share of Elo's net loss)[140](index=140&type=chunk) - Loss on changes in fair value was **$2.4 million** in H1 **2025** (due to iECURE investment) compared to a gain of **$0.3 million** in H1 **2024** (due to Imugene Convertible Note)[141](index=141&type=chunk) - Loss on change in fair value of warrant liability was less than **$0.1 million** in H1 **2025** compared to a gain of **$18.2 million** in H1 **2024**[142](index=142&type=chunk) - Interest income decreased by **$1.1 million** due to lower interest rates and a lower cash balance[144](index=144&type=chunk) [Liquidity and Capital Resources](index=38&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's cash position, funding requirements, and ability to finance future operations - As of June **30, 2025**, the company had an accumulated deficit of **$526.5 million** and expects to incur significant operating losses for the foreseeable future[147](index=147&type=chunk)[148](index=148&type=chunk) - Total cash, cash equivalents, and restricted cash were **$84.8 million** as of June **30, 2025**, down from **$123.6 million** as of June **30, 2024**[149](index=149&type=chunk)[154](index=154&type=chunk) - The company believes existing cash and expected operational receipts will fund operations into the **second half of 2027**, sufficient for potential Phase **2** for PBGENE-HBV and pivotal study for PBGENE-DMD[165](index=165&type=chunk) - The company is subject to the "Baby Shelf Rule," limiting capital raised through primary public offerings via Form S-**3** (including ATM facility) to **one-third** of its public float until it exceeds **$75 million**[151](index=151&type=chunk)[152](index=152&type=chunk)[189](index=189&type=chunk) - Net cash used in operating activities increased by **$5.5 million** to **$39.3 million** for H1 **2025** compared to H1 **2024**[157](index=157&type=chunk) - Net cash provided by financing activities decreased by **$24.8 million** to **$16.0 million** for H1 **2025**, primarily due to the absence of a large underwritten offering seen in H1 **2024**[161](index=161&type=chunk) - The company has a **$22.5 million** term loan with Banc of California, requiring it to maintain an aggregate balance in a cash security account at least equal to the outstanding principal amount[149](index=149&type=chunk)[162](index=162&type=chunk)[163](index=163&type=chunk) [Critical Accounting Policies and Use of Estimates](index=42&type=section&id=Critical%20Accounting%20Policies%20and%20Use%20of%20Estimates) This section confirms no significant changes to critical accounting policies from the prior annual report - No significant changes in critical accounting policies and estimates from the prior annual report[172](index=172&type=chunk) [Smaller Reporting Company Status](index=42&type=section&id=Smaller%20Reporting%20Company%20Status) This section explains the company's status as a smaller reporting company and its implications for disclosures and investor appeal - The company is a "smaller reporting company" and benefits from reduced disclosure requirements, including presenting two years of audited financial statements and reduced executive compensation disclosures[173](index=173&type=chunk) - This status may make the common stock less attractive to investors, potentially leading to a less active trading market or increased stock price volatility[174](index=174&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=42&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate sensitivity, with no material impact expected from a **10%** rate change - The company's primary market risk is interest rate sensitivity, related to its cash and cash equivalents[175](index=175&type=chunk) - A hypothetical **10%** change in interest rates is not expected to have a material impact on the financial statements as of June **30, 2025**[175](index=175&type=chunk) [Item 4. Controls and Procedures](index=42&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls were effective as of June **30, 2025**, with no material changes in internal control over financial reporting - Disclosure controls and procedures were effective at a reasonable assurance level as of June **30, 2025**[177](index=177&type=chunk) - No material changes in internal control over financial reporting occurred during Q2 **2025**[178](index=178&type=chunk) [PART II. OTHER INFORMATION](index=43&type=section&id=PART%20II.%20OTHER%20INFORMATION) This part includes legal proceedings, risk factors, equity sales, defaults, mine safety, other information, exhibits, and signatures [Item 1. Legal Proceedings](index=43&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently party to any material legal proceedings, though subject to ordinary course claims - The company is not currently involved in any material legal proceedings[180](index=180&type=chunk) [Item 1A. Risk Factors](index=43&type=section&id=Item%201A.%20Risk%20Factors) This section details significant investment risks across financial condition, product development, operations, and intellectual property [Risks Related to Our Financial Condition, Limited Operating History and Need for Additional Capital](index=43&type=section&id=Risks%20Related%20to%20Our%20Financial%20Condition%2C%20Limited%20Operating%20History%20and%20Need%20for%20Additional%20Capital) Risks from operating losses, funding needs, and unpredictable success due to limited operating history are highlighted - The company has incurred significant operating losses since inception, with an accumulated deficit of **$526.5 million** as of June **30, 2025**, and does not expect to be profitable in the foreseeable future[182](index=182&type=chunk) - Substantial additional funding will be required to advance product candidates, and failure to raise capital on acceptable terms could force delays, reductions, or elimination of research programs[186](index=186&type=chunk) - The company's limited operating history and the novel nature of its genome editing platform make it difficult to predict future success or viability[198](index=198&type=chunk)[199](index=199&type=chunk)[200](index=200&type=chunk) - Resource allocation decisions may lead to expending limited resources on less successful programs or foregoing opportunities with greater commercial potential[201](index=201&type=chunk) [Risks Related to the Identification, Development and Commercialization of Our Product Candidates](index=48&type=section&id=Risks%20Related%20to%20the%20Identification%2C%20Development%20and%20Commercialization%20of%20Our%20Product%20Candidates) This section addresses risks in developing novel ARCUS technology, competition, public perception, and product liability - ARCUS is a novel technology, making it difficult to predict the time, cost, and potential success of product candidate development, with limited human safety and efficacy data available[202](index=202&type=chunk) - The genome editing field is rapidly evolving, and other existing or future technologies may offer significant advantages over ARCUS, potentially harming the company's business[203](index=203&type=chunk) - The company is heavily dependent on the successful development and commercialization of ARCUS-based product candidates, which is uncertain given their early stage of development[204](index=204&type=chunk) - Failure to achieve projected development milestones or commercialization in expected timeframes could delay product commercialization and harm the business[207](index=207&type=chunk) - Adverse public perception of genome editing technology could negatively impact developmental progress or commercial success, potentially leading to increased regulation or decreased demand[208](index=208&type=chunk)[209](index=209&type=chunk) - The company faces significant competition from major pharmaceutical and biotechnology companies with greater resources and expertise, which could lead to competitors achieving regulatory approval sooner or developing superior treatments[210](index=210&type=chunk)[212](index=212&type=chunk) - Commercialization in various global markets subjects the company to risks including complex regulatory compliance, reduced intellectual property protection, economic instability, and longer collection times[213](index=213&type=chunk)[214](index=214&type=chunk) - Product liability lawsuits, arising from clinical trials or commercial sales, could result in substantial liabilities, reputational damage, and limit commercialization efforts[215](index=215&type=chunk)[216](index=216&type=chunk)[217](index=217&type=chunk) [Additional Risks Related to the Identification, Development and Commercialization of Our Therapeutic Product Candidates](index=54&type=section&id=Additional%20Risks%20Related%20to%20the%20Identification%2C%20Development%20and%20Commercialization%20of%20Our%20Therapeutic%20Product%20Candidates) This section covers regulatory complexities, clinical trial challenges, potential product failures, and market acceptance issues - The regulatory landscape for gene editing therapeutic product candidates is rigorous, complex, uncertain, and subject to change, potentially causing delays, termination of development, or unexpected costs[221](index=221&type=chunk)[223](index=223&type=chunk)[224](index=224&type=chunk)[225](index=225&type=chunk)[226](index=226&type=chunk)[227](index=227&type=chunk) - The regulatory approval processes are lengthy, time-consuming, and inherently unpredictable, with no assurance of obtaining marketing approval for product candidates[229](index=229&type=chunk)[230](index=230&type=chunk) - Clinical trials are difficult to design, expensive, time-consuming, and involve uncertain outcomes, with potential for delays, suspensions, or terminations due to various factors including patient enrollment, safety concerns, or regulatory disagreements[233](index=233&type=chunk)[235](index=235&type=chunk)[236](index=236&type=chunk)[237](index=237&type=chunk)[238](index=238&type=chunk) - Product candidates may not work as intended or could cause undesirable side effects, off-target editing, or other serious adverse events, potentially hindering regulatory approval or commercialization[263](index=263&type=chunk)[265](index=265&type=chunk) - The company is subject to extensive federal, state, and foreign healthcare laws and regulations (e.g., Anti-Kickback Statute, False Claims Act, HIPAA, GDPR), and non-compliance could lead to substantial penalties, fines, and reputational harm[268](index=268&type=chunk)[270](index=270&type=chunk)[271](index=271&type=chunk)[272](index=272&type=chunk)[275](index=275&type=chunk)[276](index=276&type=chunk)[277](index=277&type=chunk)[279](index=279&type=chunk) - Information technology system failures, cyberattacks, or cybersecurity deficiencies could disrupt operations, lead to data loss, intellectual property compromise, and incur significant costs and liabilities[280](index=280&type=chunk)[281](index=281&type=chunk)[282](index=282&type=chunk)[283](index=283&type=chunk)[284](index=284&type=chunk)[285](index=285&type=chunk)[286](index=286&type=chunk) - The company may seek orphan drug designation but may be unable to obtain or maintain its benefits, which could negatively impact development, regulatory approval, and revenue[287](index=287&type=chunk)[288](index=288&type=chunk)[291](index=291&type=chunk) - Regulatory approval in one jurisdiction does not guarantee approval in others, limiting market opportunities[292](index=292&type=chunk) - Current and future legislation (e.g., ACA, IRA) may increase the difficulty and cost of obtaining marketing approval and commercializing products, and adversely affect pricing[293](index=293&type=chunk)[299](index=299&type=chunk)[300](index=300&type=chunk)[301](index=301&type=chunk) - Approved products will remain subject to ongoing regulatory requirements (e.g., manufacturing, labeling, post-market surveillance), resulting in significant additional expenses and potential enforcement actions for non-compliance[303](index=303&type=chunk)[306](index=306&type=chunk)[307](index=307&type=chunk) - Disruptions at regulatory agencies (e.g., FDA) due to funding shortages or global health concerns could delay product development and approval[310](index=310&type=chunk)[312](index=312&type=chunk) - Even with regulatory approval, products may fail to achieve sufficient market acceptance by physicians, patients, and payors, limiting commercial success[313](index=313&type=chunk)[314](index=314&type=chunk) - Inability to establish effective sales and marketing capabilities or secure third-party agreements could hinder commercialization[315](index=315&type=chunk)[319](index=319&type=chunk) - Market opportunities for rare genetic diseases may be smaller than estimated, or patient identification difficult, adversely affecting revenues[320](index=320&type=chunk) - Failure to obtain or maintain adequate coverage, reimbursement levels, and favorable pricing policies from governmental authorities and health insurers could limit marketability and revenue generation[321](index=321&type=chunk)[323](index=323&type=chunk)[324](index=324&type=chunk)[325](index=325&type=chunk)[326](index=326&type=chunk)[327](index=327&type=chunk) - Biologic product candidates may face competition from biosimilar products sooner than anticipated, potentially shortening exclusivity periods and increasing competitive pressure[328](index=328&type=chunk)[329](index=329&type=chunk) [Risks Related to Our Organization, Structure and Operations](index=76&type=section&id=Risks%20Related%20to%20Our%20Organization%2C%20Structure%20and%20Operations) Operational risks include managing growth, personnel, public company compliance, insurance, environmental, fraud, and tax complexities - Difficulties in managing business needs, including attracting and retaining qualified personnel, could disrupt operations and limit the rate and success of product development[331](index=331&type=chunk)[332](index=332&type=chunk)[334](index=334&type=chunk)[335](index=335&type=chunk) - Future transactions (acquisitions, investments, in-licenses) could disrupt business, cause stockholder dilution, reduce financial resources, and may not strengthen competitive position[333](index=333&type=chunk) - Operating as a public company incurs significant legal, accounting, and compliance costs, requiring substantial management time and resources, and failure to maintain effective internal controls could harm financial reporting and stock price[336](index=336&type=chunk)[337](index=337&type=chunk)[338](index=338&type=chunk) - Insurance policies are expensive and may not adequately cover all business risks, leaving the company exposed to significant uninsured liabilities, especially for biological or hazardous waste[344](index=344&type=chunk)[346](index=346&type=chunk) - Failure to comply with environmental, health, and safety laws and regulations by the company or its third-party manufacturers/suppliers could result in fines, penalties, or significant costs[347](index=347&type=chunk)[348](index=348&type=chunk)[350](index=350&type=chunk)[351](index=351&type=chunk) - The company is exposed to risks of fraud or misconduct by employees, consultants, and collaborators, which could lead to significant penalties, fines, and reputational harm[352](index=352&type=chunk)[353](index=353&type=chunk) - Complex tax rules and potential audits could result in additional tax liabilities, and the company may not be able to utilize all of its net operating loss (NOL) carryforwards due to ownership changes or changes in tax laws[354](index=354&type=chunk)[355](index=355&type=chunk)[357](index=357&type=chunk) [Risks Related to Our Reliance on Third Parties](index=82&type=section&id=Risks%20Related%20to%20Our%20Reliance%20on%20Third%20Parties) This section outlines risks from dependence on third-party collaborators, CROs, and manufacturers for development and supply - The company relies on third-party collaborators for research, development, and commercialization, which involves risks such as limited control over resources, potential for disputes, and termination of agreements[358](index=358&type=chunk)[359](index=359&type=chunk)[360](index=360&type=chunk) - Inability to establish collaborations on commercially reasonable terms could force alterations to research, development, and commercialization plans[361](index=361&type=chunk)[363](index=363&type=chunk) - Reliance on third parties (CROs, clinical investigators) to conduct clinical trials poses risks if they fail to carry out duties, comply with regulations, or perform satisfactorily, potentially delaying regulatory approval or commercialization[364](index=364&type=chunk)[365](index=365&type=chunk)[366](index=366&type=chunk)[367](index=367&type=chunk)[368](index=368&type=chunk) - Dependence on third parties for raw materials and product manufacturing carries risks of supply reduction, interruptions, quality issues, or delays, which could harm the business[369](index=369&type=chunk)[370](index=370&type=chunk) [Risks Related to Intellectual Property](index=85&type=section&id=Risks%20Related%20to%20Intellectual%20Property) This section addresses challenges in obtaining, maintaining, and defending intellectual property rights, including patentability and infringement - Commercial success depends on obtaining, maintaining, and defending proprietary rights to intellectual property, including ARCUS and product candidates, which is uncertain due to factors like inventorship, patentability, and challenges by third parties[371](index=371&type=chunk)[372](index=372&type=chunk)[373](index=373&type=chunk)[374](index=374&type=chunk)[375](index=375&type=chunk)[376](index=376&type=chunk)[377](index=377&type=chunk) - Failure to comply with obligations in intellectual property license agreements (e.g., Duke License, Cellectis License) could result in the loss of critical license rights[378](index=378&type=chunk)[384](index=384&type=chunk) - Some in-licensed intellectual property, discovered through government-funded research, may be subject to federal regulations like "march-in" rights and a preference for U.S.-based manufacturing, potentially limiting exclusive rights[386](index=386&type=chunk)[388](index=388&type=chunk) - Failure to obtain patent term extension in the U.S. (Hatch-Waxman Act) and foreign countries could shorten marketing exclusivity and harm the business[389](index=389&type=chunk) - Patents involve complex legal and factual questions, and their issuance, scope, validity, and enforceability are uncertain, potentially leading to challenges or circumvention[390](index=390&type=chunk)[391](index=391&type=chunk)[392](index=392&type=chunk)[393](index=393&type=chunk)[394](index=394&type=chunk) - Third parties may assert claims of patent infringement, or the company may need to defend/enforce its patents, leading to substantial costs, delays, or loss of productivity[395](index=395&type=chunk)[396](index=396&type=chunk)[397](index=397&type=chunk)[398](index=398&type=chunk)[399](index=399&type=chunk) - Developments in patent law (e.g., AIA, Supreme Court rulings) and the complexity of international patent systems (e.g., EU's Unified Patent Court) could negatively impact the company's ability to obtain and enforce patents[400](index=400&type=chunk)[401](index=401&type=chunk)[402](index=402&type=chunk)[403](index=403&type=chunk)[409](index=409&type=chunk)[410](index=410&type=chunk)[411](index=411&type=chunk) - Inability to protect the confidentiality of trade secrets and enforce intellectual property assignment agreements would harm the business and competitive position[404](index=404&type=chunk)[406](index=406&type=chunk) - The company may not be successful in obtaining or maintaining necessary rights to product components and processes for its development pipeline through acquisitions and in-licenses, potentially limiting growth[413](index=413&type=chunk)[415](index=415&type=chunk) - Inadequate protection of trademarks and trade names could hinder brand recognition and adversely affect the business[416](index=416&type=chunk) [Risks Related to Owning Our Common Stock](index=94&type=section&id=Risks%20Related%20to%20Owning%20Our%20Common%20Stock) This section covers risks for common stock owners, including litigation, lack of dividends, and anti-takeover provisions - The company could be subject to securities class action litigation, especially given stock price volatility common in biopharmaceutical companies[417](index=417&type=chunk) - The company does not intend to pay dividends on its common stock for the foreseeable future, meaning investment success depends on future stock price appreciation[418](index=418&type=chunk) - Provisions in the company's amended and restated certificate of incorporation and bylaws, along with Delaware law, could discourage, delay, or prevent a change in control or management, potentially depressing the stock price[419](index=419&type=chunk)[420](index=420&type=chunk)[421](index=421&type=chunk) - Exclusive forum provisions in corporate documents may limit stockholders' ability to obtain a favorable judicial forum for disputes with the company or its directors/officers[422](index=422&type=chunk) [General Risk Factors](index=96&type=section&id=General%20Risk%20Factors) This section discusses broad risks such as disasters, economic instability, stock price volatility, delisting, and analyst opinions - Natural or man-made disasters, public health emergencies, and other catastrophic events could severely disrupt operations and materially adversely affect the business[425](index=425&type=chunk)[426](index=426&type=chunk) - Unstable market and economic conditions (e.g., credit market disruptions, inflation) may adversely affect the business, financial condition, and stock price, making debt or equity financing more difficult and costly[427](index=427&type=chunk)[429](index=429&type=chunk) - The market price of the common stock is likely to be highly volatile and fluctuate substantially due to numerous factors, including financial results, development progress, competition, and market conditions[430](index=430&type=chunk)[431](index=431&type=chunk)[434](index=434&type=chunk) - Failure to meet Nasdaq's continued listing requirements (e.g., Minimum Bid Price Requirement) could result in delisting, negatively impacting the stock price and stockholders' ability to trade shares[432](index=432&type=chunk)[437](index=437&type=chunk)[438](index=438&type=chunk) - Adverse or misleading opinions from securities or industry analysts, or failure to meet their expectations, could cause the stock price and trading volume to decline[439](index=439&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=99&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales of equity securities or use of proceeds to report for the period - No unregistered sales of equity securities or use of proceeds to report[440](index=440&type=chunk) [Item 3. Defaults Upon Senior Securities](index=99&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities to report for the period - No defaults upon senior securities to report[441](index=441&type=chunk) [Item 4. Mine Safety Disclosures](index=99&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Mine safety disclosures are not applicable to the company - Mine safety disclosures are not applicable[442](index=442&type=chunk) [Item 5. Other Information](index=100&type=section&id=Item%205.%20Other%20Information) No other information to report for the period - No other information to report[443](index=443&type=chunk) [Item 6. Exhibits](index=101&type=section&id=Item%206.%20Exhibits) The exhibits include corporate documents, incentive plans, certifications, and XBRL documents - The exhibits include corporate documents (Certificate of Incorporation, Bylaws), incentive award plans, certifications (CEO, CFO), and XBRL documents[444](index=444&type=chunk) [Signatures](index=102&type=section&id=Signatures) The report is signed by Michael Amoroso (President, CEO, Director) and John Alexander Kelly (CFO) on August **7, 2025** - The report is signed by Michael Amoroso (President, CEO, and Director) and John Alexander Kelly (CFO) on August **7, 2025**[449](index=449&type=chunk) ```

[Executive Summary & Business Update](index=1&type=section&id=Executive%20Summary%20%26%20Business%20Update) Precision BioSciences reported Q2 2025 results, focusing on advancing PBGENE-HBV and PBGENE-DMD programs and extending cash runway to H2 2027 through expense reduction [Company Overview and Strategic Highlights](index=1&type=section&id=Company%20Overview%20and%20Strategic%20Highlights) Precision BioSciences, a clinical-stage gene editing company, focuses on advancing lead programs and extending its cash runway to H2 2027 through expense reduction - Focus on advancing clinical-stage PBGENE-HBV and PBGENE-DMD programs[3](index=3&type=chunk) - Extended expected cash runway to the **second half of 2027** through significant reduction in non-program related annual operating expenses[3](index=3&type=chunk)[5](index=5&type=chunk) - Actions expected to enable commencement of a Phase 2 study for PBGENE-HBV and a potential pivotal trial for PBGENE-DMD[3](index=3&type=chunk) [Pipeline Update](index=1&type=section&id=Pipeline%20Update) The company provided updates on wholly-owned and partnered gene editing programs, including PBGENE-HBV, PBGENE-DMD, iECURE-OTC, and Azer-Cel, while pausing PBGENE-3243 [Wholly Owned Portfolio](index=1&type=section&id=Wholly%20Owned%20Portfolio) Updates on wholly-owned programs, including PBGENE-HBV, PBGENE-DMD, and the paused PBGENE-3243 [PBGENE-HBV (Viral Elimination Program)](index=1&type=section&id=PBGENE-HBV%20(Viral%20Elimination%20Program)) PBGENE-HBV, a viral elimination program for chronic Hepatitis B, showed promising Phase 1 safety and antiviral activity, with Cohort 3 initiation recommended - PBGENE-HBV is a global first-in-human clinical trial designed to eliminate cccDNA and inactivate integrated HBV DNA for chronic Hepatitis B[4](index=4&type=chunk) - Phase 1 ELIMINATE-B trial Cohort 1 demonstrated substantial antiviral activity in all patients, with HBsAg reductions of **47-69%** and durable reduction in one patient **7 months post-dose**[5](index=5&type=chunk)[8](index=8&type=chunk) - PBGENE-HBV was well-tolerated in Cohort 1 with no Grade 2+ treatment-related adverse events, serious adverse events, or dose-limiting toxicity[7](index=7&type=chunk) - Initial safety data from Cohort 2 showed no adverse events above Grade 2, and the Data Monitoring Committee recommended initiation of Cohort 3[9](index=9&type=chunk) - Company expects to provide a data update later in 2025[10](index=10&type=chunk) [PBGENE-DMD (Muscle Targeted Excision Program)](index=2&type=section&id=PBGENE-DMD%20(Muscle%20Targeted%20Excision%20Program)) PBGENE-DMD, a muscle-targeted excision program for Duchenne Muscular Dystrophy, received FDA designations and showed significant preclinical functional improvement - PBGENE-DMD is designed to improve function for over **60% of DMD patients** by excising exons 45-55 of the dystrophin gene to restore near-full length functional dystrophin protein[11](index=11&type=chunk) - Granted FDA Rare Pediatric Disease Designation (June 2025) and Orphan Drug Designation (July 2025) for DMD[5](index=5&type=chunk)[12](index=12&type=chunk) - Preclinical data showed significant and durable functional improvement in a humanized DMD mouse model, restoring dystrophin protein expression across multiple muscle types[13](index=13&type=chunk)[14](index=14&type=chunk) - IND/CTA filing targeted by end of 2025, with initial clinical data expected in 2026[5](index=5&type=chunk)[15](index=15&type=chunk) [PBGENE-3243 (Mutant Mitochondrial DNA Elimination Program)](index=3&type=section&id=PBGENE-3243%20(Mutant%20Mitochondrial%20DNA%20Elimination%20Program)) Development of PBGENE-3243, a mutant mitochondrial DNA elimination program, has been paused to prioritize lead programs - Development of PBGENE-3243 paused to prioritize PBGENE-HBV and PBGENE-DMD[16](index=16&type=chunk) [Partnered In Vivo Gene Editing Programs](index=3&type=section&id=Partnered%20In%20Vivo%20Gene%20Editing%20Programs) Updates on partnered in vivo gene editing programs, including iECURE-OTC for OTC deficiency and PBGENE-NVS for hemoglobinopathies [iECURE-OTC (Gene Insertion Program)](index=3&type=section&id=iECURE-OTC%20(Gene%20Insertion%20Program)) iECURE-OTC, a gene insertion program for neonatal onset OTC deficiency, demonstrated a complete clinical response in a Phase 1/2 trial - ECUR-506 demonstrated a complete clinical response from three months post-exposure to six months in a Phase 1/2 trial for neonatal onset OTC deficiency[17](index=17&type=chunk) - Second infant with severe OTC deficiency dosed in H1 2025[17](index=17&type=chunk) - iECURE expects to complete enrollment in 2025 and anticipates complete data in H1 2026[18](index=18&type=chunk) [PBGENE-NVS (Gene Insertion Program)](index=3&type=section&id=PBGENE-NVS%20(Gene%20Insertion%20Program)) PBGENE-NVS is a collaboration with Novartis to develop an ARCUS nuclease for in vivo gene insertion to treat hemoglobinopathies - Collaboration with Novartis to develop a custom ARCUS nuclease for in vivo gene insertion to treat hemoglobinopathies[19](index=19&type=chunk) [Non-Core Ex Vivo Programs](index=3&type=section&id=Non-Core%20Ex%20Vivo%20Programs) Update on non-core ex vivo program Azer-Cel, an allogeneic CAR T treatment for cancer, showing promising response rates [Azer-Cel (Allogeneic CAR T treatment for cancer)](index=3&type=section&id=Azer-Cel%20(Allogeneic%20CAR%20T%20treatment%20for%20cancer)) Azer-Cel, an allogeneic CAR T treatment, achieved a 75% overall response rate and 55% complete response rate in DLBCL patients - Azer-Cel achieved a **75% best overall response rate** and **55% complete response rate** in relapsed/refractory DLBCL patients[20](index=20&type=chunk) - Imugene expects to request an end of Phase 1 meeting with the FDA in Q4 2025 to discuss pivotal trial designs[20](index=20&type=chunk) [Other Corporate Announcements](index=3&type=section&id=Other%20Corporate%20Announcements) Dr. Mark Sulkowski was appointed Head Clinical Development Advisor to support clinical strategy for PBGENE-HBV and later-stage trials - Dr. Mark Sulkowski appointed Head Clinical Development Advisor to support clinical strategy for PBGENE-HBV and later-stage trials[21](index=21&type=chunk) [Financial Results for Second Quarter 2025](index=4&type=section&id=Financial%20Results%20for%20Second%20Quarter%202025) This section details Precision BioSciences' financial performance for Q2 2025, including operating expenses, revenue, and net loss, alongside an updated cash runway [Financial Summary and Cash Runway](index=4&type=section&id=Financial%20Summary%20and%20Cash%20Runway) The company reduced Q2 operating expenses by $3.9 million and initiated an efficiency program to cut annual cash operating expenses by $25 million, extending its cash runway to H2 2027 - Total operating expenses decreased by **$3.9 million** in Q2 2025 compared to Q2 2024[22](index=22&type=chunk) - Initiated an operating efficiency program to reduce annual cash operating expenses by approximately **$25 million** in 2026 and 2027 compared to 2025 levels[22](index=22&type=chunk) - Expected cash runway extended to the **second half of 2027**[5](index=5&type=chunk)[22](index=22&type=chunk) Cash, Cash Equivalents, and Restricted Cash | As of | Amount (in millions) | | :---- | :------------------- | | June 30, 2025 | $84.8 | | December 31, 2024 | $108.5 | [Detailed Financial Performance](index=4&type=section&id=Detailed%20Financial%20Performance) Detailed financial performance shows a significant revenue decrease due to prior non-cash recognition, reduced R&D expenses, slightly increased G&A, and a net loss for Q2 2025 [Revenues](index=4&type=section&id=Revenues) Total revenues for Q2 2025 significantly decreased compared to Q2 2024, primarily due to a non-cash deferred revenue recognition in the prior period Total Revenues (QoQ) | Period | Revenue (in millions) | Change | | :----- | :-------------------- | :----- | | Q2 2025 | < $0.1 | -$49.8M | | Q2 2024 | $49.9 | | - Decrease primarily due to **$48.2 million** of non-cash deferred revenue recognized in Q2 2024 related to the Prevail Therapeutics Agreement[23](index=23&type=chunk) [Operating Expenses](index=4&type=section&id=Operating%20Expenses) Operating expenses saw a decrease in R&D due to program adjustments and pauses, while general and administrative expenses slightly increased Research and Development Expenses (QoQ) | Period | R&D Expenses (in millions) | Change | | :----- | :------------------------- | :----- | | Q2 2025 | $12.8 | -$4.4M | | Q2 2024 | $17.2 | | - Decrease in R&D primarily due to lower manufacturing/toxicology expenses for PBGENE-HBV and decreased expenses for paused PBGENE-3243, offset by increased PBGENE-DMD expenses[24](index=24&type=chunk) General and Administrative Expenses (QoQ) | Period | G&A Expenses (in millions) | Change | | :----- | :------------------------- | :----- | | Q2 2025 | $9.1 | +$0.6M | | Q2 2024 | $8.5 | | - Increase in G&A due to higher employee-related costs, including non-cash costs[25](index=25&type=chunk) [Net Loss and EPS](index=4&type=section&id=Net%20Loss%20and%20EPS) The company reported a net loss and negative EPS for Q2 2025, a shift from net income in the prior year Net Income/Loss and EPS (QoQ) | Period | Net (Loss) Income (in millions) | EPS (Basic) | | :----- | :------------------------------ | :---------- | | Q2 2025 | ($23.5) | ($2.13) | | Q2 2024 | $32.7 | $4.70 | [Company Information](index=4&type=section&id=Company%20Information) This section provides an overview of Precision BioSciences as a clinical-stage gene editing company and details its proprietary ARCUS® genome editing platform [About Precision BioSciences](index=4&type=section&id=About%20Precision%20BioSciences) Precision BioSciences is a clinical-stage gene editing company developing in vivo gene editing therapies using its proprietary ARCUS® platform - Precision BioSciences is a clinical-stage gene editing company focused on in vivo gene editing therapies[27](index=27&type=chunk) - Utilizes its novel and proprietary ARCUS® genome editing platform[27](index=27&type=chunk) [ARCUS® Platform](index=6&type=section&id=ARCUS%C2%AE%20Platform) The ARCUS® platform facilitates advanced gene edits, including insertion, elimination of viral or mutant mitochondrial DNA, and excision of defective gene portions - ARCUS® platform supports gene insertion, elimination (viral DNA, mutant mitochondrial DNA), and excision (large defective gene portions)[28](index=28&type=chunk) [Forward-Looking Statements](index=6&type=section&id=Forward-Looking%20Statements) This section outlines forward-looking statements regarding future expectations, plans, and potential outcomes, acknowledging inherent risks and uncertainties [Forward-Looking Statements](index=6&type=section&id=Forward-Looking%20Statements) This section details forward-looking statements concerning program development, regulatory processes, financial projections, and collaborations, emphasizing inherent risks and uncertainties - Statements cover expectations for ARCUS advantages, program development (PBGENE-HBV, PBGENE-DMD), regulatory timelines, cash runway, and partner activities[29](index=29&type=chunk) - Forward-looking statements are subject to known and unknown risks, uncertainties, and assumptions, including funding, operating expenses, program success, regulatory approvals, and competition[30](index=30&type=chunk)[31](index=31&type=chunk) [Financial Statements](index=8&type=section&id=Financial%20Statements) This section presents the condensed financial statements, including statements of operations and balance sheet data, for the specified periods [Statements of Operations](index=8&type=section&id=Statements%20of%20Operations) Condensed statements of operations for Q2 2025 and 2024 are presented, detailing revenues, operating expenses, and net income or loss Statements of Operations (Three Months Ended June 30) | (In thousands, except share and per share amounts) | 2025 | 2024 | | :------------------------------------------------ | :--- | :--- | | Revenue | $18 | $49,898 | | Research and development | 12,768 | 17,225 | | General and administrative | 9,127 | 8,527 | | Total operating expenses | 21,895 | 25,752 | | Operating (loss) income | (21,877) | 24,146 | | Total other (expense) income | (1,643) | 8,603 | | Net (loss) income | $(23,520) | $32,749 | | Net (loss) income per share - Basic | $(2.13) | $4.70 | | Net (loss) income per share - Diluted | $(2.13) | $4.67 | | Weighted-average shares of common stock outstanding - Basic | 11,046,401 | 6,966,680 | | Weighted-average shares of common stock outstanding - Diluted | 11,046,401 | 7,011,630 | [Balance Sheets Data](index=9&type=section&id=Balance%20Sheets%20Data) Key balance sheet data as of June 30, 2025, and December 31, 2024, including cash, working capital, assets, liabilities, and equity, is provided Balance Sheets Data (As of) | (In thousands, except share amounts) | June 30, 2025 | December 31, 2024 | | :---------------------------------- | :------------ | :---------------- | | Cash, cash equivalents, and restricted cash | $84,806 | $108,468 | | Working capital | 56,691 | 80,009 | | Total assets | 108,928 | 136,388 | | Total liabilities | 74,874 | 79,995 | | Total stockholders' equity | $34,054 | $56,393 | | Common stock outstanding | 11,636,981 | 8,202,715 |

Summary of Precision Biosciences Conference Call Company Overview - **Company**: Precision Biosciences - **Ticker**: DTL - **Industry**: Gene Editing and Biotechnology - **Stage**: Clinical stage in vivo gene editing company, previously preclinical until February 2025 [4][5] Core Programs and Developments 1. **PBGene HBV (Hepatitis B Program)** - Currently treating patients in three sites across five countries with data readouts expected in 2025 [5][6] - Addresses a significant unmet need with approximately 300 million people affected globally and over 5 million currently treated with nucleoside analogs [18][19] - Aims to eliminate the virus at its source by targeting cccDNA, which is crucial for chronic hepatitis B [20][21] - Phase one trial design includes multiple ascending doses to ensure safety and efficacy [25][26] - Fast track designation received from the FDA in March 2025 [28] 2. **PBGene DMD (Duchenne Muscular Dystrophy Program)** - A gene editing approach targeting the mutation affecting 60% of DMD patients, with IND or CTA filing planned for later in 2025 and data expected in 2026 [5][6][31] - Addresses a high unmet need with approximately 15,000 patients in the US and 300,000 globally [34] - Designed to provide functional muscle improvement over time, which is currently lacking in existing therapies [35][36] 3. **OTC Deficiency Program** - Partnership with ACURE focusing on severe OTC deficiency in infants, showing promising early data [6][17] Technology and Competitive Advantage - **Arcus Technology** - A novel gene editing tool with over 65 patents, distinct from CRISPR, minimizing patent disputes [7][8] - Features include a unique three-prime cut, smaller size allowing dual delivery via AAV, and simplicity with a single protein for recognition and cutting [9][11][14] - Capable of addressing a broader range of gene editing needs beyond simple edits, targeting root causes of diseases [15][16] Financial Position - **Cash Position**: $100 million as of March 2025, sufficient to fund operations into the second half of 2026 [49] - **Market Valuation**: Current market cap is lower than cash reserves, indicating potential undervaluation [57] Market Context and Investor Sentiment - The biotech sector has faced challenges due to high interest rates and inflation, leading to decreased investor interest [58] - Recent clinical data and advancements in programs are expected to attract investor attention and improve market perception [59] - The company operates with a leaner structure compared to competitors, enhancing capital efficiency [60] Key Takeaways - Precision Biosciences is positioned to address significant unmet medical needs in hepatitis B and DMD with innovative gene editing technologies - The company is advancing its clinical programs with a strong focus on safety and efficacy, supported by a solid financial foundation - There is optimism for future growth as clinical data emerges, potentially leading to increased investor interest and market valuation improvements [55][59]

Group 1 - Precision BioSciences reported a quarterly loss of $2.21 per share, significantly worse than the Zacks Consensus Estimate of a loss of $0.43, representing an earnings surprise of -413.95% [1] - The company posted revenues of $0.03 million for the quarter ended March 2025, missing the Zacks Consensus Estimate by 99.71%, compared to revenues of $17.58 million a year ago [2] - The stock has increased approximately 29.9% since the beginning of the year, outperforming the S&P 500's gain of 0.2% [3] Group 2 - The earnings outlook for Precision BioSciences is currently unfavorable, with a Zacks Rank of 4 (Sell), indicating expected underperformance in the near future [6] - The current consensus EPS estimate for the upcoming quarter is -$0.08 on revenues of $13.7 million, and -$1.17 on revenues of $45.6 million for the current fiscal year [7] - The Medical - Biomedical and Genetics industry is ranked in the top 28% of over 250 Zacks industries, suggesting a favorable industry outlook [8]

Precision BioSciences (DTIL) Conference Call Summary Company Overview - **Company**: Precision BioSciences - **Focus**: Gene editing therapies, particularly for Duchenne muscular dystrophy (DMD) and chronic hepatitis B (HBV) Key Points from the Conference Call Industry and Market Context - **Duchenne Muscular Dystrophy (DMD)**: A genetic disorder leading to progressive muscle degeneration, with approximately 300,000 to 400,000 patients globally and 15,000 new cases in the U.S. annually [9] - **Current Treatment Landscape**: Existing therapies, including microdystrophins and exon skipping, have not achieved significant long-term muscle functional improvement [7][43] Core Program Updates - **PBGene DMD**: - A clinical-stage candidate aimed at providing durable muscle functional improvement for DMD patients, focusing on correcting mutations in the dystrophin gene [5][6] - The program is designed to address the highest unmet needs in DMD, with a unique mechanism that allows for the production of a near full-length dystrophin protein [20][31] - Preclinical data shows significant improvements in muscle force output in treated mice, maintaining improvements up to nine months post-treatment [22][23] Safety and Efficacy - **Safety Profile**: The use of lower doses of AAV (adeno-associated virus) is expected to enhance safety, reducing the risk associated with high doses [35][49] - **Durability of Treatment**: The ability to edit satellite cells is crucial for long-term muscle function improvement, with evidence of increased dystrophin protein expression over time [25][28][99] Regulatory Pathway - **FDA Interactions**: Precision BioSciences has had positive discussions with the FDA regarding their clinical trial design and biomarker linkage to functional improvement [59][102] - **Clinical Trial Timeline**: Targeting to file a CTA or IND by late 2025, with clinical trials expected to commence in 2026 [61][66] Financial and Operational Updates - **Resource Allocation**: The company is prioritizing its resources towards the HBV and DMD programs, pausing the PBGene 3243 mitochondrial DNA elimination program for fiscal reasons [62][64] - **Cash Runway**: The company has sufficient cash runway into the second half of 2026 to meet Phase 1 clinical requirements [68] Additional Insights - **Patient Perspective**: The potential for improved durability and better dystrophin expression is seen as a significant advancement over current therapies, which have struggled to demonstrate clinical efficacy [46][53] - **Commercial Considerations**: Screening for neutralizing antibodies will be critical, as many patients may have previously received AAV therapies, impacting eligibility for new treatments [80][83] Conclusion - Precision BioSciences is positioned to make significant advancements in the treatment of DMD and HBV, with promising preclinical data and a clear regulatory pathway. The focus on safety, efficacy, and patient needs underscores the company's commitment to addressing high unmet medical needs in these areas.

[First Quarter 2025 Financial Results and Business Update](index=1&type=section&id=First%20Quarter%202025%20Financial%20Results%20and%20Business%20Update) Precision BioSciences reported strong Q1 2025 momentum with significant clinical data, regulatory approvals, and accelerated program development [CEO Commentary](index=1&type=section&id=CEO%20Commentary) CEO Michael Amoroso highlighted strong Q1 2025 momentum, significant clinical data generation, and accelerated program development - ARCUS in vivo gene insertion validated clinically with a **complete response** in an infant with OTC-deficiency[3](index=3&type=chunk) - Phase 1 ELIMINATE-B trial for chronic Hepatitis B (PBGENE-HBV) progressing, with **encouraging safety data** after repeat dosing presented at EASL Congress[3](index=3&type=chunk) - U.S. IND approval and Fast Track Designation received for PBGENE-HBV, underscoring its potential for a curative treatment[3](index=3&type=chunk) - PBGENE-DMD program accelerated, targeting IND/CTA in 2025 with clinical data in 2026, based on preclinical proof of protein expression and improved muscle function[3](index=3&type=chunk)[4](index=4&type=chunk) [First Quarter 2025 Business Highlights](index=1&type=section&id=First%20Quarter%202025%20Business%20Highlights) Q1 2025 achievements include new clinical data, initial safety results, regulatory clearances, program acceleration, and extended cash runway - New clinical data announced for two programs, validating safety and efficacy of ARCUS in vivo gene editing[4](index=4&type=chunk) - Initial safety data from Phase 1 ELIMINATE-B trial (PBGENE-HBV) presented at EASL, with ongoing clinical updates expected throughout 2025[4](index=4&type=chunk) - Regulatory clearance of IND from U.S. FDA to expand ELIMINATE-B trial and CTA approved by MHRA for UK expansion; PBGENE-HBV granted U.S. FDA Fast Track Designation[4](index=4&type=chunk) - PBGENE-DMD program accelerated to be a first-in-class in vivo gene editing approach for Duchenne's Muscular Dystrophy, targeting IND/CTA in 2025 and clinical data in 2026[4](index=4&type=chunk) - Expected cash runway into **second half of 2026**, enabling data readouts from lead wholly-owned programs (PBGENE-HBV and PBGENE-DMD)[4](index=4&type=chunk) [Pipeline Update](index=2&type=section&id=Pipeline%20Update) Precision BioSciences is advancing its wholly-owned and partnered programs, achieving key clinical and preclinical milestones [Wholly Owned Portfolio](index=2&type=section&id=Wholly%20Owned%20Portfolio) The company is prioritizing PBGENE-HBV and PBGENE-DMD, showing promising clinical and preclinical data, while pausing PBGENE-3243 [PBGENE-HBV (Viral Elimination Program)](index=2&type=section&id=PBGENE-HBV%20(Viral%20Elimination%20Program)) PBGENE-HBV demonstrated initial safety and HBsAg reduction, receiving U.S. IND and Fast Track, and U.K. CTA clearances - PBGENE-HBV is the first and only gene editing program in clinic designed to eliminate cccDNA and inactivate integrated HBV DNA for chronic Hepatitis B[5](index=5&type=chunk) - Initial results from cohort 1 showed PBGENE-HBV was safe and well tolerated, with **substantial reduction in Hepatitis B surface antigen (HBsAg)** in two of three participants at the lowest dose[6](index=6&type=chunk) - Received U.S. FDA clearance for Phase 1 trials and Fast Track designation in March/April 2025; U.K. MHRA also cleared for Phase 1 trial, making it the fifth country[7](index=7&type=chunk) - Initial safety data presented at EASL Congress on May 8, 2025, supported pre-planned repeat dosing and dose escalation[8](index=8&type=chunk) [PBGENE-DMD (Muscle Targeted Excision Program)](index=2&type=section&id=PBGENE-DMD%20(Muscle%20Targeted%20Excision%20Program)) PBGENE-DMD showed significant functional improvement in preclinical models and is prioritized for 2025 IND/CTA filing - PBGENE-DMD addresses over **60% of DMD patients** by excising exons 45-55 to restore a near-full length functional dystrophin protein[9](index=9&type=chunk) - Preclinical data presented at MDA and ASGCT demonstrated **significant, durable functional improvement** and restoration of dystrophin protein across multiple muscles, including cardiac tissue, in a humanized DMD mouse model[10](index=10&type=chunk)[11](index=11&type=chunk) - The program is prioritized as the second wholly-owned clinical program, targeting IND/CTA filing in 2025 and clinical data in 2026[12](index=12&type=chunk) [PBGENE-3243 (Mutant Mitochondrial DNA Elimination Program)](index=3&type=section&id=PBGENE-3243%20(Mutant%20Mitochondrial%20DNA%20Elimination%20Program)) PBGENE-3243 showed preclinical efficacy in mutant mtDNA elimination but is paused to focus on lead programs - PBGENE-3243 is designed to specifically target and eliminate mutant m.3243G mitochondrial DNA, addressing the root cause of m.3243-associated mitochondrial disease[13](index=13&type=chunk) - New preclinical data at ASGCT showed an ARCUS nuclease can eliminate mutant mitochondrial DNA and achieve therapeutically meaningful heteroplasmy shifts in vivo[14](index=14&type=chunk) - Development of PBGENE-3243 is paused to accelerate PBGENE-DMD, with future development to be staged after PBGENE-HBV Phase 1 completion and PBGENE-DMD reaching the clinic[15](index=15&type=chunk) [Partnered Programs](index=3&type=section&id=Partnered%20Programs) Partnered programs iECURE-OTC and PBGENE-NVS are progressing, with iECURE-OTC showing a complete clinical response [iECURE-OTC (Gene Insertion Program)](index=3&type=section&id=iECURE-OTC%20(Gene%20Insertion%20Program)) iECURE-OTC reported a complete clinical response in an OTC-deficient infant, with full enrollment expected in 2025 - iECURE-OTC (ECUR-506) is an ARCUS-mediated in vivo gene editing program for neonatal onset OTC deficiency, currently in a Phase 1/2 trial (OTC-HOPE)[16](index=16&type=chunk) - Clinical efficacy and safety data from the first patient showed a **complete clinical response** from three months post-exposure to six months, with the patient now over one year old and eating age-appropriate protein levels[16](index=16&type=chunk) - The OTC-HOPE study is ongoing in multiple countries, with enrollment expected to complete in 2025 and complete data anticipated in the first half of 2026[17](index=17&type=chunk) [PBGENE-NVS (Gene Insertion Program)](index=3&type=section&id=PBGENE-NVS%20(Gene%20Insertion%20Program)) PBGENE-NVS, in collaboration with Novartis, aims for an in vivo gene insertion therapy for hemoglobinopathies - Precision continues to advance its gene editing program with Novartis (PBGENE-NVS) for hemoglobinopathies such as sickle cell disease and beta thalassemia[18](index=18&type=chunk) - The program aims to insert a therapeutic transgene in vivo as a potential **one-time transformative treatment**, overcoming access disparities of ex vivo approaches[18](index=18&type=chunk) [First Quarter 2025 Financial Performance](index=4&type=section&id=First%20Quarter%202025%20Financial%20Performance) Precision BioSciences reported a net loss in Q1 2025 due to decreased revenue, with R&D and G&A expenses remaining stable [Cash, Cash Equivalents, and Restricted Cash](index=4&type=section&id=Cash,%20Cash%20Equivalents,%20and%20Restricted%20Cash) Cash, cash equivalents, and restricted cash totaled approximately **$100 million**, extending the cash runway into H2 2026 Cash Position | Metric | March 31, 2025 | December 31, 2024 | | :-------------------------------- | :------------- | :---------------- | | Cash, cash equivalents, and restricted cash | $99,789 thousand | $108,468 thousand | - Company expects cash runway into the **second half of 2026**, enabling data readouts from PBGENE-HBV and PBGENE-DMD through Phase 1[19](index=19&type=chunk) [Revenues](index=4&type=section&id=Revenues) Total revenues significantly decreased to **less than $0.1 million** in Q1 2025 due to concluded collaboration agreements Revenue Comparison (Q1 2025 vs Q1 2024) | Metric | Q1 2025 | Q1 2024 | Change | | :------- | :------ | :------ | :----- | | Revenue | < $0.1M | $17.6M | -$17.6M | - Decrease due to revenue recognized from TG Therapeutics and Caribou Biosciences agreements in Q1 2024, decrease in Prevail agreement revenue (concluded April 2024), and decrease in Novartis Agreement revenue as preclinical work nears completion[20](index=20&type=chunk) [Research and Development Expenses](index=4&type=section&id=Research%20and%20Development%20Expenses) R&D expenses slightly increased to **$13.6 million** in Q1 2025, driven by the advancement of the PBGENE-DMD program R&D Expenses Comparison (Q1 2025 vs Q1 2024) | Metric | Q1 2025 | Q1 2024 | Change | | :------------------------ | :-------- | :-------- | :----- | | Research and development | $13.6M | $13.3M | +$0.3M | - Increase primarily due to increased direct expense for PBGENE-DMD as the program advances towards the clinic[21](index=21&type=chunk) [General and Administrative Expenses](index=4&type=section&id=General%20and%20Administrative%20Expenses) G&A expenses rose slightly to **$8.6 million** in Q1 2025, primarily due to higher employee-related costs G&A Expenses Comparison (Q1 2025 vs Q1 2024) | Metric | Q1 2025 | Q1 2024 | Change | | :-------------------------- | :-------- | :-------- | :----- | | General and administrative | $8.6M | $8.4M | +$0.2M | - Increase primarily due to employee-related costs, partially offset by decreases in depreciation, amortization, taxes, and insurance[22](index=22&type=chunk) [Net Loss](index=4&type=section&id=Net%20Loss) The company reported a net loss of **$(20.6) million**, or **$(2.21) per share**, in Q1 2025 Net (Loss) Income and EPS Comparison (Q1 2025 vs Q1 2024) | Metric | Q1 2025 | Q1 2024 | | :---------------------- | :-------- | :-------- | | Net (loss) income | $(20.6)M | $8.6M | | Net (loss) income per share (Basic) | $(2.21) | $1.70 | | Net (loss) income per share (Diluted) | $(2.21) | $1.70 | [Company Information](index=4&type=section&id=Company%20Information) Precision BioSciences is a clinical-stage gene editing company leveraging its ARCUS® platform for in vivo therapies [Company Profile](index=4&type=section&id=Company%20Profile) Precision BioSciences is a clinical-stage gene editing company developing in vivo therapies for high unmet medical needs - Precision BioSciences is a clinical stage gene editing company utilizing its proprietary ARCUS® genome editing platform[24](index=24&type=chunk) - Lead programs are PBGENE-HBV for chronic Hepatitis B and PBGENE-DMD for Duchenne muscular dystrophy, targeting diseases with high unmet need[24](index=24&type=chunk) [ARCUS® Genome Editing Platform](index=4&type=section&id=ARCUS%C2%AE%20Genome%20Editing%20Platform) The ARCUS® platform is a unique genome editing technology enabling gene insertion, elimination, and excision capabilities - ARCUS® platform differs from other technologies in its cutting mechanism, smaller size, and simpler structure[24](index=24&type=chunk) - Capabilities include gene insertion (adding function), elimination (removing viral DNA), and excision (removing defective gene portions)[25](index=25&type=chunk) [Financial Statements](index=7&type=section&id=Financial%20Statements) Financial statements detail Q1 2025 performance, including a significant revenue decrease, operating loss, and balance sheet changes [Statements of Operations](index=7&type=section&id=Statements%20of%20Operations) Statements of Operations show a Q1 2025 net loss of **$(20.6) million** due to decreased revenue, with stable expenses Statements of Operations (In thousands, except share and per share amounts) | Metric | For the Three Months Ended March 31, 2025 | For the Three Months Ended March 31, 2024 | | :-------------------------------------- | :---------------------------------------- | :---------------------------------------- | | Revenue | $29 | $17,584 | | Research and development | $13,588 | $13,343 | | General and administrative | $8,553 | $8,428 | | Total operating expenses | $22,141 | $21,771 | | Operating loss | $(22,112) | $(4,187) | | Total other income | $1,547 | $12,775 | | Net (loss) income | $(20,565) | $8,588 | | Net (loss) income per share (Basic) | $(2.21) | $1.70 | | Net (loss) income per share (Diluted) | $(2.21) | $1.70 | | Weighted-average shares outstanding (Basic) | 9,292,066 | 5,060,978 | | Weighted-average shares outstanding (Diluted) | 9,292,066 | 5,063,406 | [Balance Sheets Data](index=8&type=section&id=Balance%20Sheets%20Data) Balance sheets data indicates a decrease in cash, total assets, and liabilities as of March 31, 2025 Balance Sheets Data (In thousands, except share amounts) | Metric | March 31, 2025 | December 31, 2024 | | :-------------------------------- | :------------- | :---------------- | | Cash, cash equivalents, and restricted cash | $99,789 | $108,468 | | Working capital | $69,710 | $80,009 | | Total assets | $124,411 | $136,388 | | Total liabilities | $75,074 | $79,995 | | Total stockholders' equity | $49,337 | $56,393 | | Common stock outstanding | 10,548,852 | 8,202,715 | [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This section outlines future expectations, beliefs, and assumptions, along with inherent risks and uncertainties that may impact actual results

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements (unaudited)](index=6&type=section&id=Item%201.%20Financial%20Statements%20%28unaudited%29) Precision BioSciences reported a significant Q1 2025 revenue decrease to $29 thousand, a net loss of $20.6 million, and reduced total assets Condensed Balance Sheet Data (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $77,223 | $85,899 | | Restricted cash | $22,566 | $22,569 | | Total Assets | $124,411 | $136,388 | | Total Liabilities | $75,074 | $79,995 | | Total Stockholders' Equity | $49,337 | $56,393 | Condensed Statement of Operations (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenue | $29 | $17,584 | | Total operating expenses | $22,141 | $21,771 | | Operating loss | $(22,112) | $(4,187) | | Net (loss) income | $(20,565) | $8,588 | | Net (loss) income per share (Basic & Diluted) | $(2.21) | $1.70 | Condensed Statement of Cash Flows (in thousands) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(19,052) | $(18,981) | | Net cash used in investing activities | $(314) | $(26) | | Net cash provided by financing activities | $10,687 | $40,095 | | Net (decrease) increase in cash | $(8,679) | $(21,088) | [Notes to Condensed Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Financial%20Statements) Notes detail the company's strategic shift to in vivo gene editing, key collaborations, and financial specifics like loan and warrant liabilities - The company has strategically shifted to **focus exclusively on developing in vivo gene editing therapies**, with its former CAR T programs now accounted for as **discontinued operations**[30](index=30&type=chunk)[31](index=31&type=chunk) - Revenue from the Novartis collaboration was **less than $0.1 million** in Q1 2025, down from **$4.5 million** in Q1 2024. Deferred revenue related to this agreement was **$26.2 million** as of March 31, 2025[54](index=54&type=chunk) - The company has a **$22.5 million** term loan with Banc of California, with a stated interest rate of **6.00%** as of March 31, 2025[38](index=38&type=chunk)[39](index=39&type=chunk) - R&D expenses are broken down by program, with PBGENE-DMD and PBGENE-3243 seeing increased spending, while PBGENE-HBV spending decreased as it moved into the clinic[81](index=81&type=chunk) - Warrants from the March 2024 public offering are **classified as a liability**, valued at **$3.6 million** as of March 31, 2025, with changes in fair value recorded in the statement of operations[82](index=82&type=chunk)[84](index=84&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the strategic focus on ARCUS gene editing, program updates for PBGENE-HBV and PBGENE-DMD, and financial outlook - The company is a clinical-stage gene editing company focused on developing in vivo therapies for genetic and infectious diseases using its proprietary ARCUS platform[88](index=88&type=chunk) - PBGENE-HBV for chronic Hepatitis B is in a global first-in-human clinical trial. Initial data from the first cohort was safe and well-tolerated, with substantial HBsAg reduction. The FDA has granted **Fast Track designation**[90](index=90&type=chunk)[91](index=91&type=chunk)[92](index=92&type=chunk) - The company is prioritizing and accelerating the PBGENE-DMD program for Duchenne muscular dystrophy, targeting an IND and/or CTA filing in 2025 with clinical data expected in 2026[97](index=97&type=chunk) - Development of PBGENE-3243 for mitochondrial disease is being paused to accelerate PBGENE-DMD and conserve resources[100](index=100&type=chunk) Results of Operations Comparison (in thousands) | Line Item | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $29 | $17,584 | $(17,555) | | Research and development | $13,588 | $13,343 | $245 | | General and administrative | $8,553 | $8,428 | $125 | | Net (loss) income | $(20,565) | $8,588 | $(29,153) | - The company believes its existing cash and cash equivalents of **$99.8 million** will be **sufficient to fund operating expenses and capital expenditure requirements into the second half of 2026**[155](index=155&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=32&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate sensitivity on its $99.8 million cash, with no material impact expected from fluctuations - The company's main market risk is interest rate sensitivity on its cash, cash equivalents, and restricted cash, which totaled **$99.8 million** at March 31, 2025[165](index=165&type=chunk) - A hypothetical 10% change in interest rates is not expected to have a material impact on the company's financial condition[165](index=165&type=chunk) [Controls and Procedures](index=32&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were effective as of March 31, 2025, with no material changes to internal controls - The CEO and CFO concluded that the company's disclosure controls and procedures were **effective as of March 31, 2025**[167](index=167&type=chunk) - No material changes were made to the internal control over financial reporting during the three months ended March 31, 2025[168](index=168&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=33&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently involved in any material legal proceedings - As of the report date, the company is **not involved in any material legal proceedings**[170](index=170&type=chunk) [Risk Factors](index=33&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks including historical losses, funding needs, unproven technology, regulatory complexities, and capital raising limitations - The company has a history of significant operating losses (**$503.0 million** accumulated deficit as of March 31, 2025) and expects to incur losses for the foreseeable future, requiring substantial additional funding[172](index=172&type=chunk)[176](index=176&type=chunk) - The ARCUS gene editing platform is a novel technology, making it difficult to predict the time, cost, and success of product development. The company has not yet been able to assess the safety and efficacy of most of its product candidates in humans[193](index=193&type=chunk) - The regulatory landscape for gene editing therapies is rigorous, complex, and subject to change, which could result in delays, termination of development, or unexpected costs[215](index=215&type=chunk) - The company relies on third parties for collaborations (e.g., Novartis), conducting clinical trials (CROs), and manufacturing (CMOs), and the failure of these parties to perform could substantially harm the business[355](index=355&type=chunk)[362](index=362&type=chunk)[368](index=368&type=chunk) - As of the filing date, the company is subject to the "Baby Shelf Rule," which limits the amount of funds it can raise through its Form S-3 registration statement to **one-third of its public float** in any 12-month period[179](index=179&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=83&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) On January 6, 2025, the company issued **220,712** unregistered common shares to TG Subsidiary for a **$2.5 million** deferred cash payment - On January 6, 2025, the company issued **220,712 shares** of common stock to TG Subsidiary in exchange for a **$2.5 million** deferred cash payment related to their license agreement[439](index=439&type=chunk) - The issuance was an unregistered sale, relying on the **Section 4(a)(2) exemption** under the Securities Act[439](index=439&type=chunk) [Other Information](index=83&type=section&id=Item%205.%20Other%20Information) Two executive officers, Jeff Smith and Alex Kelly, established Rule 10b5-1 trading plans for stock sales and RSU tax obligations - Chief Research Officer Jeff Smith entered into a **Rule 10b5-1 trading plan** to sell up to **7,931 shares** of common stock between May 2025 and January 2026[442](index=442&type=chunk) - Chief Financial Officer Alex Kelly entered into a **Rule 10b5-1 sell-to-cover instruction** to sell shares to cover tax obligations from vesting RSUs[443](index=443&type=chunk) [Exhibits](index=84&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including corporate documents and Sarbanes-Oxley certifications