Intellia Therapeutics(NTLA) - 2025 Q2 - Quarterly Report

PART I - FINANCIAL INFORMATION This section presents Intellia Therapeutics, Inc.'s unaudited condensed consolidated financial statements and related notes Item 1. Financial Statements (unaudited) This section presents Intellia Therapeutics, Inc.'s unaudited condensed consolidated financial statements for June 30, 2025, and December 31, 2024, including balance sheets, statements of operations, stockholders' equity, cash flows, and detailed notes on accounting policies, investments, and other financial items Condensed Consolidated Balance Sheets This table provides a snapshot of the Company's assets, liabilities, and stockholders' equity as of June 30, 2025, and December 31, 2024 | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------------- | :----------------------------- | :----------------------------- | | ASSETS | | | | Total current assets | $495,945 | $639,863 | | Total assets | $898,894 | $1,191,015 | | LIABILITIES AND STOCKHOLDERS' EQUITY | | | | Total current liabilities | $95,499 | $110,851 | | Total liabilities | $183,639 | $319,059 | | Total stockholders' equity | $715,255 | $871,956 | Condensed Consolidated Statements of Operations and Comprehensive Loss This table details the Company's collaboration revenue, expenses, and net loss for the three and six months ended June 30, 2025 and 2024 | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :---------------------------------- | :------------------------------------------ | :------------------------------------------ | :---------------------------------------- | :---------------------------------------- | | Collaboration revenue | $14,245 | $6,957 | $30,872 | $35,892 | | Research and development | $97,035 | $114,207 | $205,462 | $226,054 | | General and administrative | $27,206 | $31,793 | $56,213 | $62,884 | | Total operating expenses | $124,241 | $146,000 | $261,675 | $288,938 | | Operating loss | $(109,996) | $(139,043) | $(230,803) | $(253,046) | | Total other income (expense), net | $8,741 | $(7,932) | $15,219 | $(1,365) | | Net loss | $(101,255) | $(146,975) | $(215,584) | $(254,411) | | Net loss per share, basic and diluted | $(0.98) | $(1.52) | $(2.08) | $(2.64) | | Comprehensive loss | $(101,659) | $(147,183) | $(215,536) | $(255,440) | Condensed Consolidated Statements of Stockholders' Equity This table outlines changes in the Company's stockholders' equity for the six months ended June 30, 2025 and 2024 | Metric | December 31, 2024 (in thousands) | June 30, 2025 (in thousands) | | :------------------------------------------ | :------------------------------- | :----------------------------- | | Total Stockholders' Equity | $871,956 | $715,255 | | Net loss (6 months ended June 30, 2025) | | $(215,584) | | Stock-based compensation (6 months ended June 30, 2025) | | $43,876 | | Issuance of common stock through at-the-market offerings, net (6 months ended June 30, 2025) | | $13,722 | | Issuance of shares under employee stock purchase plan (6 months ended June 30, 2025) | | $1,237 | Condensed Consolidated Statements of Cash Flows This table summarizes the Company's cash flows from operating, investing, and financing activities for the six months ended June 30, 2025 and 2024 | Metric | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | | Net cash used in operating activities | $(248,552) | $(178,848) | | Net cash provided by (used in) investing activities | $201,238 | $(18,289) | | Net cash provided by financing activities | $14,652 | $101,238 | | Net decrease in cash, cash equivalents and restricted cash equivalents | $(32,662) | $(95,899) | | Cash, cash equivalents and restricted cash equivalents, end of period | $170,125 | $144,454 | Notes to Condensed Consolidated Financial Statements This section provides detailed explanations and disclosures supporting the unaudited condensed consolidated financial statements 1. Overview and Basis of Presentation Intellia Therapeutics, Inc. is a clinical-stage gene editing company focused on CRISPR-based therapies for in vivo and ex vivo applications. The unaudited condensed consolidated financial statements are prepared in accordance with U.S. GAAP and SEC regulations, with certain information condensed or omitted. The Company expects to fund operations for at least the next twelve months using existing cash, cash equivalents, and marketable securities - Intellia Therapeutics, Inc. is a clinical-stage gene editing company leveraging CRISPR-based therapies for in vivo (genetic diseases) and ex vivo (immuno-oncology and autoimmune diseases) applications[20] - The Company expects its cash, cash equivalents, and marketable securities as of June 30, 2025, to fund operations and capital expenditures for at least the next twelve months[26] 2. Summary of Significant Accounting Policies The Company's significant accounting policies remain consistent with those described in its Annual Report for the year ended December 31, 2024. Recently adopted ASU 2023-09 on income tax disclosures is not expected to have a material impact, while ASU 2024-03 on expense disaggregation is currently being evaluated - No material changes to significant accounting policies during the six months ended June 30, 2025[27] - ASU 2023-09 (Income Taxes) effective for annual periods beginning after December 15, 2024, is not expected to have a material impact[28] - ASU 2024-03 (Expense Disaggregation Disclosures) effective for annual periods beginning after December 15, 2026, is currently being evaluated for impact[29] 3. Marketable Securities The Company's available-for-sale marketable securities decreased from $672.5 million at December 31, 2024, to $474.3 million at June 30, 2025. The portfolio primarily consists of U.S. Treasury, financial institution, and corporate debt securities, with no material realized gains or losses during the period | Marketable Securities (in thousands) | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :------------ | :---------------- | | U.S. Treasury and other government-backed securities | $248,317 | $352,616 | | Financial institution debt securities | $146,647 | $217,827 | | Corporate debt securities | $79,370 | $94,927 | | Other asset-backed securities | - | $7,178 | | Total Estimated Fair Value | $474,334 | $672,548 | - No material realized gains or losses on marketable securities for the six months ended June 30, 2025, or the year ended December 31, 2024[30] 4. Fair Value Measurements The Company categorizes its financial assets measured at fair value into a three-level hierarchy. As of June 30, 2025, total assets measured at fair value were $533.9 million, primarily consisting of cash equivalents, restricted cash equivalents, and marketable securities, with a significant portion valued using Level 2 observable inputs. The investment in Kyverna Therapeutics, Inc. is classified as Level 1 | Assets (in thousands) | June 30, 2025 Total | Level 1 | Level 2 | Level 3 | | :-------------------------------- | :------------------ | :------ | :------ | :------ | | Cash equivalents and restricted cash equivalents | $55,925 | $55,925 | - | - | | Marketable securities | $474,334 | $147,562 | $326,772 | - | | Investment in Kyverna Therapeutics, Inc. | $3,604 | $3,604 | - | - | | Total assets | $533,863 | $207,091 | $326,772 | - | | Assets (in thousands) | December 31, 2024 Total | Level 1 | Level 2 | Level 3 | | :-------------------------------- | :-------------------- | :------ | :------ | :------ | | Cash equivalents and restricted cash equivalents | $66,898 | $66,898 | - | - | | Marketable securities | $672,548 | $169,735 | $502,813 | - | | Investment in Kyverna Therapeutics, Inc. | $4,390 | $4,390 | - | - | | Total assets | $743,836 | $241,023 | $502,813 | - | - The Company's investments in SparingVision SAS and AvenCell Therapeutics, Inc. are accounted for at cost minus impairment, adjusted for observable price changes, with carrying values of $14.6 million and $7.9 million, respectively, as of June 30, 2025[37][38] 5. Accrued Expenses Accrued expenses decreased to $41.6 million at June 30, 2025, from $55.4 million at December 31, 2024, primarily due to a reduction in employee compensation and benefits following a strategic restructuring and workforce reduction in January 2025 | Accrued Expenses (in thousands) | June 30, 2025 | December 31, 2024 | | :------------------------------ | :------------ | :---------------- | | Accrued research and development | $22,927 | $26,362 | | Employee compensation and benefits | $12,405 | $24,075 | | Accrued legal and professional expenses | $2,773 | $2,845 | | Accrued other | $3,448 | $2,073 | | Total accrued expenses | $41,553 | $55,355 | - In January 2025, the Company underwent a strategic restructuring, reducing its employee headcount by approximately 27%, resulting in $6.5 million in restructuring charges[39] 6. Commitments and Contingencies The Company is involved in several legal proceedings, including patent infringement claims by BlueAllele Corp., a putative class action lawsuit by a stockholder (Gonzalez v. Intellia Therapeutics, Inc.), and a stockholder derivative lawsuit (Aiello v. Bhanji et al.). The Company is currently unable to determine the likelihood or estimate the potential loss for these matters. Additionally, the Company has contingent payment obligations of up to $130.0 million related to Rewrite Therapeutics, Inc. upon achievement of regulatory approval and research milestones - BlueAllele Corp. filed a patent infringement complaint against Intellia on July 8, 2024, alleging infringement of bi-directional insertion template technology patents[41] - A stockholder lawsuit, Gonzalez v. Intellia Therapeutics, Inc., was filed on February 11, 2025, alleging false/misleading statements regarding the NTLA-3001 program[42] - A stockholder derivative lawsuit, Aiello v. Bhanji et al., was filed on May 15, 2025, alleging breach of fiduciary duty and excessive compensation to non-employee directors[43] - Contingent payments of up to $130.0 million are due to Rewrite Therapeutics, Inc. upon achieving regulatory approval ($100.0 million) and pre-specified research milestones ($30.0 million)[45] 7. Collaborations and Other Arrangements The Company engages in strategic alliances to advance gene editing product development. Collaboration revenue for the six months ended June 30, 2025, was $30.9 million, a decrease from $35.9 million in the prior year, primarily due to a one-time intra-entity profit recognition in 2024. Key collaborations include Regeneron (for ATTR amyloidosis and neurological/muscular diseases), SparingVision (ocular diseases), and ReCode Therapeutics (cystic fibrosis) | Metric (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :----------------------------- | :----------------------------- | | Accounts receivable (beginning of period) | $8,517 | $36,456 | | Accounts receivable (end of period) | $11,353 | $12,329 | | Contract liabilities - deferred revenue (beginning of period) | $38,917 | $60,993 | | Contract liabilities - deferred revenue (end of period) | $29,693 | $50,236 | | Revenue recognized from beginning contract liability | $10,245 | $10,757 | - Collaboration revenue for the six months ended June 30, 2025, was $30.9 million, a decrease of $5.0 million from $35.9 million in the prior year, primarily due to a $21.0 million intra-entity profit recognition in 2024 related to AvenCell[151] - Regeneron extended the technology collaboration term until April 2026 for a $30.0 million nonrefundable payment received in April 2024[48] - A $1.8 million development milestone for the hemophilia B program was recognized in Q2 2025[49] - The Company opted out of the hemophilia B Co/Co agreement with Regeneron in March 2024, with obligations ending September 2024[51] - Collaboration revenue from Regeneron's ATTR Co/Co agreement increased to $14.9 million for the six months ended June 30, 2025, from $9.7 million in the prior year[52] - No material revenue was recognized from SparingVision LCA for the six months ended June 30, 2025, compared to $1.1 million in the prior year[58] - Deferred revenue from SparingVision LCA was $12.5 million at June 30, 2025[58] - The Company recognized $1.0 million in revenue related to material shipments under the AvenCell LCA during the six months ended June 30, 2025[62] 8. Investments and Other Assets Total investments and other assets increased to $80.2 million at June 30, 2025, from $44.3 million at December 31, 2024, primarily due to a $36.8 million increase in long-term prepaid rent for the Tech Square Lease. The carrying value of investments in Kyverna, SparingVision, and AvenCell remained stable or slightly decreased | Investments and Other Assets (in thousands) | June 30, 2025 | December 31, 2024 | | :---------------------------------------- | :------------ | :---------------- | | Investment in Kyverna | $3,604 | $4,390 | | Prepaid rent Tech Square Lease, long-term | $36,829 | - | | Other investments | $22,481 | $22,481 | | Restricted cash equivalents, long-term | $13,776 | $13,605 | | Prepaid expenses and other assets, long-term | $3,553 | $3,788 | | Total investments and other assets | $80,243 | $44,264 | - The Company's equity interest in AvenCell Therapeutics, Inc. changed from equity method accounting to ASC 321 in Q1 2024 due to a single investor gaining control[65] - The carrying value of AvenCell Therapeutics, Inc. was $7.9 million at June 30, 2025[66] 9. Leases In February 2025, the Company strategically restructured its lease agreements, terminating the 840 Winter Lease by June 30, 2028, with $78.0 million in modification payments. Concurrently, it entered into the Tech Square Lease for new office and lab space in Cambridge, with an initial term of 12 years and three months starting September 2026. The Company recorded $36.8 million in prepaid rent for the Tech Square Lease and remeasured the 840 Winter lease liability, reducing it by $61.9 million - The 840 Winter Lease was terminated on or before June 30, 2028, with lease modification payments totaling $78.0 million[68] - A new Tech Square Lease was entered for approximately 124,000 square feet in Cambridge, with an initial term of 12 years and three months, commencing September 2026[69][70] - The 840 Winter lease liability and right-of-use asset were reduced by $61.9 million due to remeasurement[71] - The Company recorded $36.8 million of prepaid rent for the Tech Square Lease as of June 30, 2025[72] | Year Ending December 31, | Future Operating Lease Payments (in thousands) | | :----------------------- | :--------------------------------------------- | | Remainder of 2025 | $12,892 | | 2026 | $32,219 | | 2027 | $24,125 | | 2028 | $15,637 | | 2029 | $12,666 | | Thereafter | $26,593 | | Total lease payments | $124,132 | | Less: imputed interest | $(21,541) | | Total operating lease liabilities at June 30, 2025 | $102,591 | 10. Stock-Based Compensation Stock-based compensation expense decreased significantly for both the three and six months ended June 30, 2025, compared to 2024, primarily due to a reduced workforce and lower stock price. The Company adopted the 2025 Equity Incentive Plan, reserving 12.8 million shares, and continues to grant various RSU types (service, market, performance-based) and stock options | Stock-Based Compensation (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Research and development | $14,059 | $25,439 | $26,685 | $45,600 | | General and administrative | $7,977 | $15,422 | $17,191 | $29,437 | | Total | $22,036 | $40,861 | $43,876 | $75,037 | - The 2025 Equity Incentive Plan was adopted, reserving 12,831,965 shares for issuance, replacing the 2015 Plan[78][79] - Unrecognized stock-based compensation expense for RSUs was $69.4 million, expected to be recognized over 1.55 years[84] - Unrecognized compensation cost for stock options was $11.0 million, expected to be recognized over 1.23 years[100] 11. Loss Per Share The Company reported a basic and diluted net loss per share of $(0.98) for the three months ended June 30, 2025, and $(2.08) for the six months ended June 30, 2025, an improvement compared to the prior year periods. Common stock equivalents, including unvested restricted stock units and stock options, were excluded from diluted EPS calculations as their inclusion would have been anti-dilutive | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net loss (in thousands) | $(101,255) | $(146,975) | $(215,584) | $(254,411) | | Weighted average shares outstanding | 103,732 | 96,975 | 103,617 | 96,238 | | Net loss per share, basic and diluted | $(0.98) | $(1.52) | $(2.08) | $(2.64) | - Common stock equivalents (5,282 thousand unvested RSUs and 5,442 thousand stock options) were excluded from diluted loss per share calculation as they were anti-dilutive[105] 12. Stockholders' Equity The Company's at-the-market (ATM) offering program, amended in February 2024 to $750.0 million, resulted in net proceeds of $13.7 million from the issuance of 1,459,257 shares during the three months ended June 30, 2025. As of June 30, 2025, $235.1 million in shares remain eligible for sale under this program - The 2022 Sale Agreement was amended in February 2024, increasing the at-the-market offering program to $750.0 million[107] - During the three months ended June 30, 2025, the Company issued 1,459,257 shares at an average price of $9.64 per share, generating $13.7 million in net proceeds[107] - As of June 30, 2025, $235.1 million in shares of common stock remain eligible for sale under the ATM program[108] 13. Segment Information The Company operates as a single segment focused on developing gene editing-based therapies, with all material assets and collaboration revenue generated in the U.S. The Chief Executive Officer, as the CODM, evaluates performance and allocates resources based on net loss - The Company identifies one operating and reportable segment: the development of gene editing-based therapies[109] - All material assets and collaboration revenue are held/generated in the U.S.[109] | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Collaboration revenue | $14,245 | $6,957 | $30,872 | $35,892 | | Total research and development | $97,035 | $114,207 | $205,462 | $226,054 | | General and administrative | $27,206 | $31,793 | $56,213 | $62,884 | | Interest income | $(7,402) | $(12,422) | $(16,005) | $(25,054) | | Other segment information (change in fair value of investments) | $(1,339) | $20,354 | $786 | $26,419 | | Segment and consolidated net loss | $(101,255) | $(146,975) | $(215,584) | $(254,411) | Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the Company's financial condition and operational results, focusing on CRISPR-based therapies, pipeline progress for ATTR amyloidosis and HAE, and financial performance, including revenue, expenses, liquidity, and critical accounting policies Forward-looking Information This section outlines the forward-looking statements within the report, emphasizing that they are based on expectations, assumptions, and estimates, and involve substantial risks and uncertainties. It lists various factors that could cause actual results to differ materially, including clinical study execution, manufacturing capabilities, regulatory approvals, intellectual property, market acceptance, and financing needs - Forward-looking statements are based on expectations, assumptions, and estimates, and are not guarantees of future results, involving substantial risks and uncertainties[114] - Key risks include the ability to execute clinical study strategies for nex-z (ATTR amyloidosis) and lonvo-z (HAE), obtain regulatory approvals, manufacture product candidates, protect intellectual property, and secure additional financing[114] Management Overview Intellia Therapeutics is a clinical-stage gene editing company focused on revolutionizing medicine with CRISPR-based therapies. The Company is building a full-spectrum gene editing platform to advance in vivo therapies for genetic diseases and ex vivo therapies for immuno-oncology and autoimmune diseases, leveraging its scientific expertise and robust intellectual property portfolio - Intellia is a clinical-stage gene editing company focused on CRISPR-based therapies, developing both in vivo (for genetic diseases) and ex vivo (for immuno-oncology and autoimmune diseases) applications[116] - The Company's mission is to transform lives by developing potentially curative genome editing treatments, expanding its platform with novel editing and delivery technologies[116][121] Our Pipeline Intellia's pipeline features lead in vivo programs, nex-z for ATTR amyloidosis and lonvo-z for HAE, both in Phase 3 clinical trials and representing the first systemically administered CRISPR-based therapies. The Company is also advancing ex vivo programs for immuno-oncology and autoimmune diseases, and other in vivo programs targeting non-liver organs - Lead in vivo programs, nex-z (ATTR amyloidosis) and lonvo-z (HAE), are in Phase 3 clinical trials and are the first systemically administered CRISPR-based therapies[123][124] - Lonvo-z (HAE) Phase 3 HAELO study initiated in October 2024, with first patient dosed in January 2025[127] - Enrollment for Lonvo-z is ahead of schedule, expected to complete in Q3 2025, supporting a BLA submission in H2 2026 and potential launch in 2027[127] - Three-year follow-up data for lonvo-z (HAE) Phase 1 showed a 98% mean reduction in monthly HAE attack rate and deep, dose-dependent, durable reductions in plasma kallikrein protein[128] - Nex-z (ATTR-CM) Phase 3 MAGNITUDE trial enrollment is ahead of projections, with total enrollment expanded to approximately 1,200 patients[131] - FDA granted RMAT designation for nex-z for ATTR-CM in March 2025[132] - Nex-z (ATTRv-PN) Phase 3 MAGNITUDE-2 trial IND cleared in November 2024, with first patient dosed in April 2025[135] - Enrollment for Nex-z (ATTRv-PN) is ahead of schedule, expected to complete in H1 2026, supporting a BLA submission by 2028 and potential launch in 2029[135] - Two-year follow-up Phase 1 data for nex-z (ATTRv-PN) showed a mean serum TTR reduction of 90% by Day 28, sustained through 24 months, with 13 of 18 patients showing clinically meaningful improvements in mNIS+7[136] Collaborations and Other Arrangements Intellia actively forms strategic alliances to accelerate the development and commercialization of CRISPR/Cas9-based products. Current collaborations include Regeneron, AvenCell, SparingVision, Kyverna, ONK, and ReCode, which provide technology access, research funding, and potential milestone payments - The Company forms strategic alliances to accelerate development and commercialization of CRISPR/Cas9-based products[139] - Existing collaboration agreements are with Regeneron, AvenCell Therapeutics, Inc., SparingVision SAS, Kyverna Therapeutics, Inc., ONK Therapeutics, Ltd., and ReCode Therapeutics, Inc.[139] Financial Overview The Company's revenue is primarily derived from collaboration agreements, including upfront payments, technology access fees, research funding, and milestone payments. Operating expenses are dominated by research and development, encompassing employee costs, facility expenses, and clinical trial costs, while general and administrative expenses cover executive, finance, legal, and support functions. Other income (expense) primarily includes interest income and changes in the fair value of investments - Collaboration revenue includes upfront technology access payments, license fees, research materials, research funding, and milestone payments[140] - Research and development expenses cover compensation, facility costs, license/milestone fees, contract services, and clinical trial costs[141] - General and administrative expenses include compensation for executive, finance, legal, HR, and business development functions, as well as professional fees[142] - Other income (expense), net, comprises interest income and changes in the fair value of investments[143] Results of Operations The Company's net loss decreased for both the three and six months ended June 30, 2025, compared to the prior year, driven by reduced operating expenses and improved other income. Collaboration revenue increased in Q2 2025 but decreased for the six-month period due to a one-time gain in 2024. Research and development expenses saw significant reductions due to workforce restructuring and lower internal R&D spend, despite increased external costs for lead programs Comparison of Three Months Ended June 30, 2025 and 2024 For the three months ended June 30, 2025, net loss decreased by $45.7 million to $(101.3) million, primarily due to a $21.7 million decrease in investment fair value expense and a $21.8 million reduction in total operating expenses. Collaboration revenue increased by $7.3 million, mainly from Regeneron cost reimbursements | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Period-to-Period Change | | :-------------------------------- | :------------------------------- | :------------------------------- | :---------------------- | | Collaboration revenue | $14,245 | $6,957 | $7,288 | | Research and development | $97,035 | $114,207 | $(17,172) | | General and administrative | $27,206 | $31,793 | $(4,587) | | Total operating expenses | $124,241 | $146,000 | $(21,759) | | Operating loss | $(109,996) | $(139,043) | $29,047 | | Interest income | $7,402 | $12,422 | $(5,020) | | Change in fair value of investments, net | $1,339 | $(20,354) | $21,693 | | Total other income (expense), net | $8,741 | $(7,932) | $16,673 | | Net loss | $(101,255) | $(146,975) | $45,720 | - Research and development expenses decreased by $17.2 million (15%) due to a $9.4 million decrease in employee-related expenses, an $8.0 million decrease in research materials and contracted services, and an $11.4 million decrease in stock-based compensation[147] - This decrease was partially offset by a $9.3 million increase in external costs for nex-z and a $1.4 million increase for lonvo-z[147] - General and administrative expenses decreased by $4.6 million, primarily due to lower stock-based compensation, partially offset by increased commercial infrastructure buildout costs[148] Comparison of Six Months Ended June 30, 2025 and 2024 For the six months ended June 30, 2025, net loss decreased by $38.8 million to $(215.6) million. Collaboration revenue decreased by $5.0 million due to a $21.0 million intra-entity profit recognition in 2024. Research and development expenses decreased by $20.6 million (9%) due to workforce reductions and lower internal R&D spend, despite increased external costs for nex-z and lonvo-z | Metric (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Period-to-Period Change | | :-------------------------------- | :----------------------------- | :----------------------------- | :---------------------- | | Collaboration revenue | $30,872 | $35,892 | $(5,020) | | Research and development | $205,462 | $226,054 | $(20,592) | | General and administrative | $56,213 | $62,884 | $(6,671) | | Total operating expenses | $261,675 | $288,938 | $(27,263) | | Operating loss | $(230,803) | $(253,046) | $22,243 | | Interest income | $16,005 | $25,054 | $(9,049) | | Change in fair value of investments, net | $(786) | $(26,419) | $25,633 | | Total other income (expense), net | $15,219 | $(1,365) | $16,584 | | Net loss | $(215,584) | $(254,411) | $38,827 | - Research and development expenses decreased by $20.6 million (9%) due to a $15.0 million decrease in employee-related expenses, an $11.1 million decrease in research materials and contracted services, and an $18.9 million decrease in stock-based compensation[159] - This decrease was partially offset by an $18.7 million increase for nex-z and a $3.3 million increase for lonvo-z[159] - General and administrative expenses decreased by $6.7 million, primarily due to lower stock-based compensation, partially offset by increased commercial infrastructure buildout costs[155] Liquidity and Capital Resources The Company's liquidity is primarily funded by collaboration agreements, public offerings, and at-the-market offerings. As of June 30, 2025, cash, cash equivalents, and marketable securities totaled $630.5 million. The Company expects these resources, along with collaboration funding, to cover operating expenses and capital expenditures into the first half of 2027 and through the anticipated first commercial launch, excluding potential milestone payments - As of June 30, 2025, the Company had $630.5 million in cash, cash equivalents, and marketable securities[158] - The Company expects current cash, cash equivalents, marketable securities, and collaboration funding to fund operations into the first half of 2027 and through the anticipated first commercial launch[163] - Primary uses of capital include research and development, clinical trial costs, compensation, facility expenses, and legal/regulatory costs[161] At-the-Market Offering Programs The Company's at-the-market (ATM) offering program, expanded to $750.0 million in February 2024, generated $13.7 million in net proceeds from the sale of 1,459,257 shares during the three and six months ended June 30, 2025. As of June 30, 2025, $235.1 million remains available under this program - The 2022 Sale Agreement was amended in February 2024, increasing the ATM offering program to $750.0 million[160] - During the three and six months ended June 30, 2025, 1,459,257 shares were issued for aggregate net proceeds of $13.7 million[160] - As of June 30, 2025, $235.1 million in shares of common stock remain eligible for sale under the ATM program[160] Funding Requirements The Company's capital requirements are substantial, primarily for R&D, clinical trials, and operational expenses. Expenses are expected to decrease in 2025 due to a strategic reorganization focusing on high-value programs. Future funding will rely on equity financings and collaboration arrangements, with potential for dilution or relinquishing rights if additional capital is not secured - Primary capital uses include R&D research materials, clinical trial costs, compensation, and facility expenses[161] - Expenses are expected to decrease in 2025 due to a strategic reorganization focusing on high-value programs like lonvo-z and nex-z[161] - Future funding will rely on equity financings and collaboration arrangements; failure to raise capital may lead to delays or termination of product development[162] Outlook The Company projects its current cash, cash equivalents, and marketable securities, combined with collaboration funding, will sustain operations into the first half of 2027 and through the anticipated first commercial launch. This estimate is based on current assumptions and excludes potential milestone payments or strategic capital uses. Generating revenue and achieving profitability depend on successful development, regulatory approvals, market acceptance, and effective intellectual property management - Cash, cash equivalents, and marketable securities as of June 30, 2025, along with collaboration funding, are expected to fund operations into the first half of 2027 and through the anticipated first commercial launch[163] - Ability to generate revenue and achieve profitability depends on successful development, regulatory approvals, market acceptance, and IP rights management[164][165] Cash Flows For the six months ended June 30, 2025, net cash used in operating activities increased to $248.6 million, including $65.0 million in non-recurring restructuring payments. Net cash provided by investing activities significantly increased to $201.2 million due to marketable securities maturities. Net cash provided by financing activities decreased to $14.7 million, primarily from at-the-market offerings | Cash Flow (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------------- | :----------------------------- | :----------------------------- | | Net cash used in operating activities | $(248,552) | $(178,848) | | Net cash provided by (used in) investing activities | $201,238 | $(18,289) | | Net cash provided by financing activities | $14,652 | $101,238 | - Net cash used in operating activities for H1 2025 included $65.0 million of non-recurring cash payments for portfolio prioritization, workforce reduction, and real estate consolidation[167] - Net cash provided by investing activities in H1 2025 was primarily due to $202.2 million in maturities of marketable securities (net of purchases)[169] Critical Accounting Policies The Company's critical accounting policies, which involve significant judgments and estimates, remain unchanged from those discussed in its Annual Report for the year ended December 31, 2024. These policies primarily relate to revenue recognition, accrued research and development expenses, and stock-based compensation - Critical accounting policies include revenue recognition, accrued research and development expenses, and stock-based compensation[173] - No changes to critical accounting policies from the Annual Report for the year ended December 31, 2024[173] Recent Accounting Pronouncements Information regarding recent accounting pronouncements applicable to the Company's business is detailed in Note 2, 'Summary of Significant Accounting Policies,' within the condensed consolidated financial statements - Refer to Note 2 for details on recent accounting pronouncements[174] Contractual Obligations There were no material changes to the Company's contractual obligations during the six months ended June 30, 2025, other than those related to leases, as described in Note 9 to the condensed consolidated financial statements - No material changes to contractual obligations during the six months ended June 30, 2025, except for lease-related changes detailed in Note 9[175] Item 3. Quantitative and Qualitative Disclosures About Market Risk The Company's primary market risk exposure is interest rate sensitivity, given its $530.3 million in cash equivalents, restricted cash equivalents, and marketable securities, primarily invested in interest-bearing money market accounts and debt securities. Due to the short-term nature and low-risk profile of its investments, a 100 basis point change in interest rates is not expected to materially affect the fair value of the portfolio, though declines would reduce future investment income. The Company has no foreign currency or derivative financial instruments and does not believe inflation materially affected results for the six months ended June 30, 2025 - Primary market risk is interest rate sensitivity, with $530.3 million in cash equivalents, restricted cash equivalents, and marketable securities as of June 30, 2025[176] - A 100 basis point change in interest rates is not expected to materially affect the fair value of the investment portfolio due to its short-term duration and low-risk profile[176] - The Company does not have foreign currency or derivative financial instruments and believes inflation did not materially affect results for the six months ended June 30, 2025[177] Item 4. Controls and Procedures. The Company's management, with the participation of its CEO and CFO, evaluated the effectiveness of its disclosure controls and procedures as of June 30, 2025, concluding they were effective at a reasonable assurance level. No material changes in internal control over financial reporting occurred during the three months ended June 30, 2025 - Disclosure controls and procedures were evaluated and deemed effective at the reasonable assurance level as of June 30, 2025[179] - No material changes in internal control over financial reporting occurred during the three months ended June 30, 2025[180] PART II - OTHER INFORMATION This section includes legal proceedings, risk factors, equity sales, other information, and exhibits for the reporting period Item 1. Legal Proceedings The Company is involved in various legal proceedings, including a patent infringement lawsuit by BlueAllele Corp., a putative stockholder class action (Gonzalez v. Intellia Therapeutics, Inc.) alleging false statements, and a stockholder derivative lawsuit (Aiello v. Bhanji et al.) concerning fiduciary duty and executive compensation. The outcomes of these matters are uncertain, and the Company is currently unable to estimate potential losses - BlueAllele Corp. filed a patent infringement complaint against Intellia on July 8, 2024, alleging infringement of bi-directional insertion template technology[182] - A stockholder lawsuit, Gonzalez v. Intellia Therapeutics, Inc., was filed on February 11, 2025, alleging false and/or misleading statements related to the NTLA-3001 program[183] - A stockholder derivative lawsuit, Aiello v. Bhanji et al., was filed on May 15, 2025, alleging breach of fiduciary duty, unjust enrichment, and waste of corporate assets[184] Item 1A. Risk Factors Investing in the Company's common stock involves significant risks, including unproven CRISPR technology, uncertain clinical development, regulatory hurdles, IP disputes, manufacturing challenges, and intense competition Summary of the Material Risks Associated with Our Business This section summarizes the key risks associated with the Company's business, including the unproven nature of CRISPR technology, the lengthy and uncertain clinical development process, potential failure to achieve regulatory approval or market acceptance, intellectual property challenges, manufacturing difficulties, and intense competition - CRISPR genome editing technology is new and unproven for human therapeutic use, and the Company's approaches may not lead to marketable products[187] - Clinical development is lengthy and expensive, with uncertain outcomes, and the Company may incur delays or be unable to complete development and commercialization[187] - Risks include inability to obtain/maintain adequate patent protection, reliance on licensed IP, lack of product sales revenue, manufacturing problems, and significant competition[187] Risks Related to Our Business This section details operational risks, including preclinical and clinical development uncertainties, IP complexities, financial needs, manufacturing vulnerabilities, regulatory hurdles, reliance on third parties, data privacy, competition, commercialization, and employee retention Risks Related to Preclinical and Clinical Development The Company faces substantial risks in preclinical and clinical development due to the novel nature of CRISPR technology, including the uncertainty of achieving regulatory approval, lengthy and expensive trial processes, and potential for delays or failures. Negative public opinion and regulatory scrutiny of gene editing could also impede progress and market acceptance - CRISPR genome editing technology is relatively new and its therapeutic utility is largely unproven, with no in vivo genome editing therapy yet approved in the U.S. or EU[189][190] - Clinical development is a lengthy, expensive, and uncertain process; trials may fail at any stage, and interim results are not predictive of final outcomes[193][204] - Negative public opinion, ethical concerns, and increased regulatory scrutiny of CRISPR or gene therapy could damage public perception, delay approvals, or limit commercialization[192][206] Risks Related to the Industry The biopharmaceutical industry's inherent risks mean that inconclusive results, lack of efficacy, or adverse events in clinical trials could significantly impede regulatory approval and market acceptance of the Company's product candidates. The Company may not successfully develop a pipeline of product candidates or achieve commercial success, potentially expending resources on unsuccessful programs - Inconclusive results, lack of efficacy, or adverse events in clinical trials could prevent or delay marketing approval, lead to narrower indications, or result in significant use restrictions[208][213] - Research and development of biopharmaceutical products is inherently risky, with no guarantee of successful product candidate development, manufacturing, regulatory approval, or commercialization[210][211] - Market acceptance of product candidates, if approved, is uncertain and depends on factors like clinical indications, perceived advantages, side effects, cost, and reimbursement[214][216] Risks Related to Intellectual Property The Company faces significant intellectual property risks, including potential infringement claims from third parties, challenges to its licensed patents (e.g., UC/Vienna/Charpentier patent family), and the possibility of losing critical license rights. Obtaining and maintaining adequate patent protection is expensive and uncertain, and unauthorized disclosure of trade secrets could undermine its competitive advantage - Third-party claims of intellectual property infringement, such as the BlueAllele Corp. lawsuit, may prevent or delay product development and commercialization efforts[217][219] - The UC/Vienna/Charpentier patent family, licensed by the Company, is subject to ongoing patent interferences and challenges (e.g., with Broad Institute, ToolGen, Sigma-Aldrich), which could result in loss of rights[226][227][228][229] - Termination or modification of license agreements, particularly with Caribou, could result in the loss of essential intellectual property rights, harming the business[232][234] - Obtaining and maintaining adequate patent protection is uncertain, expensive, and time-consuming, with no guarantee that pending applications will result in issued patents or that existing patents will be valid and enforceable[244][245][246][247] - Confidentiality agreements may not prevent unauthorized disclosure of trade secrets, and competitors could independently develop equivalent information, undermining competitive advantage[268][269] Risks Related to Our Financial Position and Need for Additional Capital The Company has never generated revenue from product sales and has incurred significant net losses since inception, with an accumulated deficit of $2.39 billion as of June 30, 2025. It will require substantial additional funding for future operations, development, and commercialization, and failure to obtain this financing could lead to delays, scaling back programs, or relinquishing rights. Raising capital may dilute existing stockholders and impose restrictive covenants - The Company has never generated revenue from product sales and does not anticipate doing so until regulatory approval of product candidates[271] - Net loss for the six months ended June 30, 2025, was $215.6 million, with an accumulated deficit of $2,393.0 million[276] - Substantial additional funding is required for preclinical and clinical development, manufacturing, and commercialization; failure to obtain it could force delays, reductions, or termination of programs[279][281] - Raising additional capital through equity or convertible debt may dilute existing stockholders and impose liquidation preferences or restrictive covenants[283] Risks Related to Manufacturing and Supply Manufacturing CRISPR-based in vivo genome editing products and ex vivo engineered cell therapies is complex and challenging, with potential for production interruptions due to equipment malfunctions, contamination, raw material shortages, or human error. The Company relies on third-party CMOs for clinical supply and may face delays or quality issues if these partners fail to meet obligations or regulatory requirements, impacting development and commercialization - Manufacturing CRISPR-based products is novel and complex, requiring difficult-to-obtain components and multiple control steps to ensure quality[286][287] - The Company relies on third-party CMOs for clinical product supplies and may face manufacturing problems, delays, or quality issues if CMOs fail to comply with regulatory requirements or meet performance obligations[288][290] - Any manufacturing and supply issues could restrict the ability to meet clinical or market demand, increase costs, and harm business prospects[290] Risks Related to Government Regulation The regulatory approval process for novel gene editing products is unpredictable, lengthy, and expensive, with limited precedent, potentially leading to significant delays. The Company holds Orphan Drug and RMAT designations for some candidates, but these do not guarantee faster development or approval. Post-approval, the Company will face ongoing, extensive regulatory obligations, and non-compliance could result in severe penalties, including withdrawal of approval or significant fines - The regulatory approval pathway for novel genome editing products is uncertain, complex, expensive, and lengthy due to limited precedent, potentially leading to significant delays[291] - Orphan Drug designation for nex-z and lonvo-z provides financial incentives and market exclusivity but does not guarantee faster review or prevent approval of clinically superior drugs[296][297][298] - RMAT designation for nex-z and lonvo-z aims to expedite development and review but does not assure ultimate FDA approval or a faster process[301] - Post-approval, the Company will be subject to ongoing regulatory requirements (cGMP, GCP, labeling, advertising, safety data), and non-compliance could lead to penalties, product recalls, or withdrawal of approval[306][307][308][309] Risks Related to Our Reliance on Third Parties The Company heavily relies on strategic collaborations, particularly with Regeneron, for technology advancement, co-development, and commercialization. Termination or adverse alteration of these agreements could significantly harm the business. Additionally, reliance on third-party CMOs and CROs for manufacturing and clinical trials introduces risks of delays, quality issues, non-compliance, and limited control over their operations, which could impede regulatory approval and commercialization - Reliance on strategic collaborations, such as with Regeneron, is critical for technology advancement and co-development; termination or adverse alteration of these agreements could harm the business[327][328] - Collaborators may not commit sufficient resources, perform as expected, or may develop competing products, impacting the success of joint programs[331][332] - Reliance on third-party CMOs for manufacturing clinical product supplies poses risks of insufficient quantities, quality issues, or failure to meet regulatory requirements (cGMP, cGTP)[335][337] - Reliance on third-party CROs and investigators for preclinical and clinical trials means limited control over their activities and compliance with GCP, potentially leading to delays or unreliable data[340][341] Risks Related to Data and Privacy The Company is highly dependent on secure information technology systems and faces risks from cybersecurity incidents, data breaches, and system failures, which could disrupt operations, lead to loss of confidential information, and incur significant liabilities. The increasing use of social media and AI platforms introduces new challenges, including potential disclosure of non-public information, reputational damage, and compliance burdens with evolving data protection and AI regulations - High dependence on IT systems and data makes the Company vulnerable to cybersecurity incidents, breaches, and failures, risking disruption of operations and loss of confidential information[347][348] - Social media platforms pose risks of inappropriate disclosure of sensitive information, negative publicity, and non-compliance with evolving regulations[353] - The rapid evolution of AI platforms and tools introduces new risks, including potential disclosure of proprietary information, increased compliance burdens with emerging AI regulations (e.g., EU AI Act, state laws), and IP risks[354][355][357][358] Risks Related to Competition The biotechnology and pharmaceutical industries are highly competitive, with numerous companies developing genome editing, gene therapy, and traditional therapeutic modalities. Many competitors possess greater resources, and the Company must be first-to-market or demonstrate superiority to achieve commercial success. Failure to compete effectively could harm its business and financial condition, potentially preventing profitability - The biotechnology and pharmaceutical industries are extremely competitive, with competition from genome editing, gene therapy, and traditional therapeutic modalities[360] - Competitors for nex-z (ATTR amyloidosis) include Alnylam, AstraZeneca, Pfizer, and others[361] - Competitors for lonvo-z (HAE) include BioCryst, CSL Limited, Takeda, and others[362] - Many competitors have substantially greater R&D capabilities and financial resources; the Company may need to be first-to-market or demonstrate product superiority to succeed[367][368] Risks Related to Commercialization The Company lacks existing sales, marketing, and distribution infrastructure and experience. Its future commercial success depends on either building these capabilities internally or establishing effective third-party arrangements. Failure to do so, or if third parties do not commit sufficient resources, could prevent successful commercialization and revenue generation - The Company lacks sales, marketing, and distribution infrastructure and experience, requiring it to build these capabilities or rely on third parties[370] - Factors inhibiting commercialization include inability to recruit/train sales personnel, lack of complementary treatments, and unforeseen costs[370] - Reliance on third parties for sales and marketing may result in lower revenue/profitability and limited control over their efforts[371] Risks Related to Employee Matters and Managing Our Workforce The Company's success is highly dependent on retaining key executives and attracting/motivating qualified personnel with specialized skills in a competitive biotechnology market. Loss of key employees or inability to recruit new talent could impede R&D and commercialization objectives. Sustained declines in stock price may also reduce the retention value of equity-based awards, impacting compensation competitiveness - Success is highly dependent on retaining key executives and attracting/motivating qualified personnel with specialized skills[372][373] - Competition for qualified personnel in the biotechnology space, especially in the Cambridge, Massachusetts area, is intense[373] - Sustained declines in stock price can reduce the retention value of equity-based awards, impacting compensation competitiveness[374] Risks Related to Healthcare Coverage and reimbursement for the Company's novel product candidates, if approved, may be limited or unavailable, making profitable sales difficult. The Company is subject to extensive federal and state healthcare fraud and abuse laws, false claims laws, and data protection laws, with non-compliance potentially leading to substantial penalties, private litigation, and reputational damage. Evolving healthcare cost control initiatives and legislative reforms could also adversely affect business and profitability - Coverage and reimbursement for novel genome editing and engineered cell products are uncertain, potentially limiting market uptake and profitability[376][379] - The Company is subject to federal and state healthcare fraud and abuse laws, false claims laws, and data protection laws (e.g., CCPA, GDPR), with non-compliance risking substantial penalties, litigation, and reputational harm[381][384][385] - Healthcare cost control initiatives and legislative reforms could prevent or delay marketing approval, affect profitability, and impact manufacturing, labeling, pricing, and sales practices[388][390] Risks Related to Our Common Stock The Company's common stock price has historically been highly volatile and may continue to fluctuate significantly due to various factors, including clinical trial results, regulatory developments, intellectual property disputes, and market conditions. Future sales of common stock could dilute existing ownership and depress the stock price. Anti-takeover provisions in the Company's charter documents and Delaware law could make an acquisition difficult, and designated forum provisions may limit stockholders' ability to choose a favorable judicial forum - The market price for the Company's common stock has been highly volatile and is subject to significant fluctuations based on clinical trial results, regulatory developments, IP disputes, and market conditions[392][394] - Future sales and issuances of common stock, including through equity incentive plans and ATM offerings, could result in substantial dilution for existing stockholders and cause the stock price to fall[404][405] - Anti-takeover provisions in the Company's charter documents and Delaware law could make an acquisition difficult and limit stockholders' ability to replace management[407][408] - Designated forum provisions in the charter documents could limit stockholders' ability to obtain a favorable judicial forum for disputes[409][411] Risks Related to Tax Matters Changes in tax law, including recent federal legislation affecting research and development expense deductions, could adversely impact the Company's business and financial condition. The Company's ability to use its substantial net operating loss (NOL) carryforwards and other tax attributes may be limited by ownership changes under Section 382 and 383 of the Internal Revenue Code, potentially reducing its ability to offset future taxable income - Changes in tax law, including recent federal legislation on R&D expense deductions, could adversely affect the Company's business and financial condition[413] - As of December 31, 2024, the Company had federal and state NOLs of $1,088.4 million and $1,079.2 million, respectively, and R&D credit carryforwards of $139.3 million and $77.9 million[414] - The ability to use NOL carryforwards and other tax attributes may be limited by ownership changes under Sections 382 and 383 of the Code, potentially reducing the ability to offset future tax