Graphite Bio(GRPH) - 2023 Q3 - Quarterly Report

Financial Performance - The net loss for the three months ended September 30, 2023, was $22.485 million, compared to a net loss of $24.682 million for the same period in 2022, showing an improvement of about 8.8%[17] - The net loss for the nine months ended September 30, 2023, was $101,733,000, compared to a net loss of $76,453,000 for the same period in 2022, representing an increase of approximately 33%[25] - Comprehensive loss for the nine months ended September 30, 2023, was $100.780 million, compared to $78.049 million for the same period in 2022, indicating a decline of approximately 28.9%[17] Cash and Cash Equivalents - As of September 30, 2023, cash and cash equivalents increased to $182.988 million from $47.730 million as of December 31, 2022, representing a significant growth[15] - Cash, cash equivalents, and restricted cash at the end of the period were $184,704,000, a significant increase from $58,107,000 at the end of the same period in 2022[25] - The company had cash, cash equivalents, and marketable securities totaling $234.0 million as of September 30, 2023, sufficient to fund operations for at least the next 12 months[32] Assets and Liabilities - Total current assets decreased to $238.783 million from $275.365 million as of December 31, 2022, indicating a reduction of approximately 13.3%[15] - Total liabilities increased to $62.209 million from $25.611 million as of December 31, 2022, reflecting a rise of approximately 143.5%[15] - The accumulated deficit increased to $344.136 million as of September 30, 2023, from $242.403 million as of December 31, 2022[15] Research and Development - Research and development expenses for the three months ended September 30, 2023, were $2.384 million, a decrease from $18.302 million in the same period of 2022[17] - The Company recognized $1.1 million in research and development expenses related to the LCGM MSA for the nine months ended September 30, 2023, compared to $4.5 million for the same period in 2022[68] - The Company has not recognized any research and development expenses in connection with the IDT License Agreement for the three and nine months ended September 30, 2023[73] Restructuring and Workforce Changes - The Company announced a restructuring plan in February 2023, resulting in a total reduction in force of 78.1% by August 2023[29] - The company incurred approximately $3.4 million in employee termination benefits expense related to the First Restructuring Plan, which eliminated about 50% of its workforce[126][127] - The Second Restructuring Plan, approved in August 2023, eliminated an additional 33.1% of the workforce, totaling 78.1% overall[128] Stock and Equity - The weighted-average shares used in computing net loss per share for the three months ended September 30, 2023, were 57,257,241, compared to 55,206,139 for the same period in 2022[17] - The company had a total of 57,971,910 shares outstanding as of September 30, 2023, compared to 58,149,317 shares as of September 30, 2022[22] - The company reserved a total of 17,465,405 shares for future issuance, up from 13,893,161 shares as of December 31, 2022, reflecting an increase of 25.0%[99] Impairment and Asset Sales - The company reported a significant impairment of assets amounting to $43,276,000 during the nine months ended September 30, 2023[25] - The company recorded impairment charges and loss on disposal of assets of $5.3 million and $6.8 million for the three and nine months ended, respectively[131] - The company sold certain assets related to its non-genotoxic conditioning technology for upfront consideration of $0.5 million, with potential additional payments of up to $1.0 million[133] Lease Agreements - The company entered into a lease agreement for 85,165 square feet of office and laboratory space with a total right-of-use asset of $32.0 million recognized upon lease commencement[88] - As of September 30, 2023, the Company had total operating lease liabilities of $53.1 million[90] - The Company entered into a sublease agreement for approximately 15,212 square feet of space in South San Francisco, California[141] Strategic Initiatives - The company paused its Phase 1/2 CEDAR study of its lead product candidate, nula-cel, in January 2023 due to a serious adverse event[27] - The Company continues to explore strategic alternatives following the discontinuation of the nula-cel development[30] - The Company has primarily relied on private equity and convertible debt financings to fund operations since inception[32]