Significant agreements

3 Months Ended

Mar. 31, 2024

Significant agreements

Significant agreements

8. Significant agreements

The Company’s significant agreements are described in Note 9 of the December 31, 2023 consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2023. During the three months ended March 31, 2024, there were no material changes to the Company’s collaboration agreements or option and license agreements and no new collaboration or license agreements. The Company recorded collaboration revenue of $19.5 million and $150.5 million during the three months ended March 31, 2024 and 2023, respectively.

2023 Neurocrine Collaboration Agreement

In the three months ended March 31, 2024, the Company revised its estimate of research services expected to be performed under the collaboration and license agreement with Neurocrine entered into in January 2023 (the “2023 Neurocrine Collaboration Agreement”). The change in estimate resulted in additional revenue recognized of approximately $7.3 million in the three months ended March 31, 2024.

2023 Novartis Stock Purchase Agreement

Under the stock purchase agreement entered into in December 2023 (the “2023 Novartis Stock Purchase Agreement”), Novartis purchased 2,145,002 shares of common stock of the Company (the “Novartis Shares”) for an

aggregate purchase price of approximately $20.0 million. The issuance of the Novartis Shares to Novartis pursuant to the 2023 Novartis Stock Purchase Agreement in January 2024 resulted in a premium of $0.7 million. The premium was allocated to the development and commercialization licenses granted to Novartis for two programs pursuant to the license and collaboration agreement with Novartis entered into in December 2023 and was recognized as collaboration revenue during the first quarter of 2024, upon the issuance of the Novartis Shares under the 2023 Novartis Stock Purchase Agreement.

2019 Neurocrine Collaboration Agreement

In February 2024, the Company announced that the joint steering committee with Neurocine selected a lead development candidate for the gene therapy program for Friedreich’s ataxia (the “FA Program”) under the collaboration and license agreement with Neurocrine entered into in January 2019 (the “2019 Neurocrine Collaboration Agreement”), which triggered a $5.0 million milestone payment to the Company that was received in the first quarter of 2024. The Company included the $5.0 million that had previously been constrained in the transaction price allocated to the FA performance obligation in the three months ended March 31, 2024, accordingly, which resulted in a cumulative catch-up adjustment to collaboration revenue of $4.4 million.

Related Party Collaboration Receivable

The following table presents changes in the balances of the Company’s related party collaboration receivable and contract liabilities for the 2023 Neurocrine Collaboration Agreement and the 2019 Neurocrine Collaboration Agreement during the three months ended March 31, 2024:

	Balance at						Balance at
	December 31, 2023		Additions		Deductions		March 31, 2024
		(in thousands)
Related party collaboration receivables	$	3,341	$	7,340	$	(8,061)	$	2,620
Contract liabilities:
Deferred revenue	$	75,240	$	586	$	(11,230)	$	64,596

The change in the related party collaboration receivable balance for the three months ended March 31, 2024 is primarily driven by amounts owed to the Company for research and development services provided, offset by amounts collected during the period, for the 2023 and 2019 Neurocrine Collaboration Agreements. Deferred revenue activity for the period includes the recording of $0.6 million of deferred revenue during the first quarter of 2024 related to the fixed transaction price allocation increase for the FA Program, offset by $11.2 million of collaboration revenue recognized on the proportional performance model during the period for the 2023 and 2019 Neurocrine Collaboration Agreements, which is classified as either current or non-current in the accompanying consolidated balance sheet based on the period the services are expected to be delivered.