Precision BioSciences(DTIL) - 2025 Q4 - Annual Report

Gene Editing Technologies - The ARCUS platform is a novel gene editing technology that enables sophisticated gene edits, including insertion, elimination, and excision, with a focus on effective and safe therapeutic outcomes [21]. - PBGENE-HBV is a first-in-human clinical trial aimed at potentially curing chronic hepatitis B by eliminating covalently closed circular DNA (cccDNA) and inactivating integrated hepatitis B virus DNA [30]. - PBGENE-DMD targets Duchenne muscular dystrophy (DMD) and aims to improve function for approximately 60% of patients by excising specific exons of the dystrophin gene [34]. - iECURE-OTC is a partnered program evaluating a targeted gene insertion approach for neonatal onset ornithine transcarbamylase deficiency, with clinical results expected in early 2026 [37]. Clinical Trials and Studies - The Phase 1/2a ELIMINATE-B trial for PBGENE-HBV is enrolling patients across multiple countries, including Hong Kong, New Zealand, the U.S., and Moldova, with plans to expand to the U.K. [30]. - Initial data from the FUNCTION-DMD study for PBGENE-DMD is expected by the end of 2026, focusing on safety and early efficacy through muscle biopsies [34]. Intellectual Property and Patents - The company owns 46 issued U.S. patents and 51 pending non-provisional U.S. patent applications as of December 31, 2024 [60]. - The company relies on a combination of patents and trade secret protection to safeguard its intellectual property related to proprietary technologies [57]. - The company intends to pursue additional patent protection related to ARCUS and existing delivery technologies through licenses from third parties [60]. - The company has pending PCT international applications and multiple pending patent applications in the United States and other countries related to engineered meganucleases targeting the hepatitis B virus, with a potential patent expiration date of November 8, 2044 [72]. Licensing Agreements - A license agreement with Caribou Biosciences was established in February 2024, providing an upfront payment and future royalties on net sales of licensed products [40]. - The Novartis Agreement was terminated effective January 30, 2026, reverting all licenses back to the company without future obligations or payments from Novartis [44]. - The Duke License requires total milestone payments of $0.3 million, with portions paid upon Series A financing and first signed partnership exceeding $1 million [48]. Regulatory Environment - The FDA's goal is to review standard applications within 10 months and priority reviews within 6 months after acceptance for filing [136]. - Orphan drug designation is granted for diseases affecting fewer than 200,000 individuals in the U.S. or when development costs cannot be recovered [147]. - The FDA may require post-market studies to monitor safety and effectiveness after commercialization [139]. - Fast track designation allows for more frequent interactions with the FDA and rolling review of applications [141]. Market and Pricing Challenges - There is substantial uncertainty regarding coverage and reimbursement for newly approved therapeutics, impacting sales potential [200]. - In the EU, governments control pricing and reimbursement levels for pharmaceutical products, creating high barriers for new product entry [201]. - The Inflation Reduction Act of 2022 requires drug manufacturers to negotiate prices with Medicare, which may significantly impact the pharmaceutical industry [205]. Workforce and Company Culture - The company has 68 full-time employees, with 46 engaged in research and development activities and 19 holding Ph.D. degrees [215]. - As of December 31, 2025, the workforce is approximately 47% female and 19% from diverse racial backgrounds [213]. - The company is committed to fostering a diverse and inclusive workplace culture to attract and retain top talent in genome editing [212].