Precision BioSciences(DTIL) - 2025 Q2 - Quarterly Results

Executive Summary & Business Update 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 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] - Extended expected cash runway to the second half of 2027 through significant reduction in non-program related annual operating expenses[3][5] - Actions expected to enable commencement of a Phase 2 study for PBGENE-HBV and a potential pivotal trial for PBGENE-DMD[3] Pipeline Update 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 Updates on wholly-owned programs, including PBGENE-HBV, PBGENE-DMD, and the paused PBGENE-3243 PBGENE-HBV (Viral Elimination Program) 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] - 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][8] - PBGENE-HBV was well-tolerated in Cohort 1 with no Grade 2+ treatment-related adverse events, serious adverse events, or dose-limiting toxicity[7] - Initial safety data from Cohort 2 showed no adverse events above Grade 2, and the Data Monitoring Committee recommended initiation of Cohort 3[9] - Company expects to provide a data update later in 2025[10] PBGENE-DMD (Muscle Targeted Excision Program) 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] - Granted FDA Rare Pediatric Disease Designation (June 2025) and Orphan Drug Designation (July 2025) for DMD[5][12] - Preclinical data showed significant and durable functional improvement in a humanized DMD mouse model, restoring dystrophin protein expression across multiple muscle types[13][14] - IND/CTA filing targeted by end of 2025, with initial clinical data expected in 2026[5][15] PBGENE-3243 (Mutant Mitochondrial DNA Elimination Program) 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] Partnered In Vivo Gene Editing Programs Updates on partnered in vivo gene editing programs, including iECURE-OTC for OTC deficiency and PBGENE-NVS for hemoglobinopathies iECURE-OTC (Gene Insertion Program) 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] - Second infant with severe OTC deficiency dosed in H1 2025[17] - iECURE expects to complete enrollment in 2025 and anticipates complete data in H1 2026[18] PBGENE-NVS (Gene Insertion Program) 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] Non-Core Ex Vivo Programs 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) 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] - Imugene expects to request an end of Phase 1 meeting with the FDA in Q4 2025 to discuss pivotal trial designs[20] Other Corporate Announcements 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] Financial Results for Second Quarter 2025 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 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] - Initiated an operating efficiency program to reduce annual cash operating expenses by approximately $25 million in 2026 and 2027 compared to 2025 levels[22] - Expected cash runway extended to the second half of 2027[5][22] Cash, Cash Equivalents, and Restricted Cash | As of | Amount (in millions) | | :---- | :------------------- | | June 30, 2025 | $84.8 | | December 31, 2024 | $108.5 | Detailed Financial Performance 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 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] Operating Expenses 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] 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] Net Loss and EPS 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 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 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] - Utilizes its novel and proprietary ARCUS® genome editing platform[27] ARCUS® Platform 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] Forward-Looking Statements This section outlines forward-looking statements regarding future expectations, plans, and potential outcomes, acknowledging inherent risks and uncertainties Forward-Looking Statements 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] - Forward-looking statements are subject to known and unknown risks, uncertainties, and assumptions, including funding, operating expenses, program success, regulatory approvals, and competition[30][31] Financial Statements This section presents the condensed financial statements, including statements of operations and balance sheet data, for the specified periods Statements of Operations 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 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 |