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SS

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2023

or

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from to .

Commission File Number: 001-37923

 

CRISPR THERAPEUTICS AG

(Exact name of registrant as specified in its charter)

 

 

Switzerland

Not Applicable

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

 

 

Baarerstrasse 14

6300 Zug, Switzerland

Not Applicable

(Address of principal executive offices)

(Zip Code)

+41 (0)41 561 32 77

(Registrant’s telephone number, including area code)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Shares, nominal value CHF 0.03

CRSP

The Nasdaq Global Market

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YesNo

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). YesNo

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large Accelerated filer

Accelerated filer

 

 

 

 

Non-accelerated filer

Smaller reporting company

 

 

 

 

 

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No

As of November 2, 2023, there were 79,432,446 shares of registrant’s common shares outstanding.

 


 

Throughout this Quarterly Report on Form 10-Q, the “Company,” “CRISPR,” “CRISPR Therapeutics,” “we,” “us,” and “our,” except where the context requires otherwise, refer to CRISPR Therapeutics AG and its consolidated subsidiaries.

“CRISPR Therapeutics®” standard character mark and design logo, “CRISPRXTM,” “CRISPR TXTM,” “CTX001TM,” “CTX110®,” “CTX112TM,” “CTX130TM,” “CTX131TM,” “CTX310TM,” “CTX320TM,” “VCTX210TM” and “VCTX211TM,” are trademarks and registered trademarks of CRISPR Therapeutics AG. All other trademarks and registered trademarks contained in this Quarterly Report on Form 10-Q are the property of their respective owners. Solely for convenience, trademarks, service marks and trade names referred to in this Quarterly Report on Form 10-Q may appear without the ® or symbols and any such omission is not intended to indicate waiver of any such rights.

 

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains “forward-looking statements” that involve substantial risks and uncertainties. All statements, other than statements of historical facts, contained in this Quarterly Report on Form 10-Q are forward-looking statements. These statements are often identified by the use of words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “potential,” “will,” “would” or the negative or plural of these words or similar expressions or variations, although not all forward-looking statements contain these identifying words. Forward-looking statements in this Quarterly Report on Form 10-Q include, but are not limited to, statements about:

the safety, efficacy and clinical progress of various clinical programs, including those for exagamglogene autotemcel, or exa-cel (formerly known as CTX001), CTX110, CTX112, CTX130, CTX131, VCTX210 and VCTX211;
the status of clinical trials, development timelines, regulatory submissions and discussions with regulatory authorities related to product candidates under development by us and our collaborators;
the initiation, timing, progress and results of our preclinical studies and clinical trials, including ongoing clinical trials and any planned clinical trials, and our research and development programs, including delays or disruptions in clinical trials, non-clinical experiments and Investigational New Drug, or IND, application-enabling studies;
the actual or potential benefits of U.S. Food and Drug Administration, or FDA, designations, such as Orphan Drug, Fast Track and regenerative medicine advanced therapy, or RMAT, or such other equivalents, including PRIority MEdicines, or PRIME, designation;
our ability to advance product candidates into, and successfully complete, clinical trials;
our intellectual property coverage and positions, including those of our licensors and third parties as well as the status and potential outcome of proceedings involving any such intellectual property;
our anticipated expenses, ability to obtain funding for our operations and the sufficiency of our cash resources; and
the therapeutic value, development, and commercial potential of CRISPR/Cas9 gene editing technologies and therapies.

Any forward-looking statements in this Quarterly Report on Form 10-Q reflect our current views with respect to future events or to our future financial performance and involve known and unknown risks, uncertainties and assumptions that could cause our actual results and the timing of certain events to differ materially from future results expressed or implied by the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those identified herein, and those discussed in the section titled “Risk Factors,” set forth in Part II, Item 1A of this Quarterly Report on Form 10-Q, if any, our Annual Report on Form 10-K filed with the Securities and Exchange Commission, or SEC, on February 21, 2023, and in other SEC filings. You should not rely upon forward-looking statements as predictions of future events. Such forward-looking statements speak only as of the date of this report. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make or enter into.

You should read this Quarterly Report on Form 10-Q and the documents that we have filed as exhibits to this Quarterly Report on Form 10-Q completely and with the understanding that our actual future results, performance or achievements may be materially different from what we expect. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements.

Investors and others should note that we announce material information to our investors using our investor relations website (https://crisprtx.gcs-web.com/), SEC filings, press releases, public conference calls and webcasts. We use these channels as well as social media to communicate with the public about our Company, our business, our product candidates and other matters. It is possible that the information we post on social media could be deemed to be material information. Therefore, we encourage investors, the media, and others interested in our Company to review the information we post on the social media channels listed on our investor relations website.

 


 

Index

 

Page

Number

PART I: FINANCIAL INFORMATION

 

 

 

Item 1. Condensed Consolidated Financial Statements (unaudited)

2

 

 

Condensed Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022

2

 

 

Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended September 30, 2023 and 2022

3

 

 

Condensed Consolidated Statements of Shareholders’ Equity for the three and nine months ended September 30, 2023 and 2022

4

 

 

Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2023 and 2022

6

 

 

Notes to Condensed Consolidated Financial Statements

7

 

 

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

17

 

 

Item 3. Quantitative and Qualitative Disclosures about Market Risk

26

 

 

Item 4. Controls and Procedures

27

 

 

PART II: OTHER INFORMATION

 

 

 

Item 1. Legal Proceedings

28

 

 

Item 1A. Risk Factors

28

 

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

28

 

 

Item 3. Defaults Upon Senior Securities

28

 

 

Item 4. Mine Safety Disclosures

28

 

 

Item 5. Other Information

28

 

 

Item 6. Exhibits

29

 

 

SIGNATURES

30

 

 


 

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements

CRISPR Therapeutics AG

Condensed Consolidated Balance Sheets

(unaudited, in thousands, except share and per share data)

 

 

 

As of

 

 

 

September 30,

 

 

December 31,

 

 

 

2023

 

 

2022

 

Assets

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

527,765

 

 

$

211,885

 

Marketable securities

 

 

1,212,061

 

 

 

1,603,433

 

Prepaid expenses and other current assets

 

 

20,760

 

 

 

37,708

 

Total current assets

 

 

1,760,586

 

 

 

1,853,026

 

Property and equipment, net

 

 

156,122

 

 

 

163,634

 

Marketable securities, non-current

 

 

 

 

 

53,130

 

Intangible assets, net

 

 

30

 

 

 

71

 

Restricted cash

 

 

11,830

 

 

 

11,635

 

Operating lease assets

 

 

156,215

 

 

 

156,921

 

Other non-current assets

 

 

2,047

 

 

 

4,640

 

Total assets

 

$

2,086,830

 

 

$

2,243,057

 

Liabilities and shareholders’ equity

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

26,152

 

 

$

27,428

 

Accrued expenses

 

 

66,405

 

 

 

77,682

 

Deferred revenue, current

 

 

3,500

 

 

 

 

Accrued tax liabilities

 

 

176

 

 

 

135

 

Operating lease liabilities

 

 

15,001

 

 

 

15,842

 

Other current liabilities

 

 

 

 

 

20

 

Total current liabilities

 

 

111,234

 

 

 

121,107

 

Deferred revenue, non-current

 

 

15,823

 

 

 

12,323

 

Operating lease liabilities, net of current portion

 

 

226,585

 

 

 

228,179

 

Other non-current liabilities

 

 

5,394

 

 

 

5,969

 

Total liabilities

 

 

359,036

 

 

 

367,578

 

Commitments and contingencies, see Note 7

 

 

 

 

 

 

Shareholders’ equity:

 

 

 

 

 

 

Common shares, CHF 0.03 nominal value, 79,607,064 and 78,692,766
  shares issued at September 30, 2023 and December 31, 2022, respectively,
79,426,748
  and
78,512,450 shares outstanding at September 30, 2023 and December 31, 2022,
  respectively

 

 

2,476

 

 

 

2,441

 

Treasury shares, at cost, 180,316 shares at September 30, 2023 and at December 31, 2022

 

 

(63

)

 

 

(63

)

Additional paid-in capital

 

 

2,821,225

 

 

 

2,734,838

 

Accumulated deficit

 

 

(1,089,047

)

 

 

(846,090

)

Accumulated other comprehensive loss

 

 

(6,797

)

 

 

(15,647

)

Total shareholders' equity

 

 

1,727,794

 

 

 

1,875,479

 

Total liabilities and shareholders’ equity

 

$

2,086,830

 

 

$

2,243,057

 

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

2


 

CRISPR Therapeutics AG

Condensed Consolidated Statements of Operations and Comprehensive Loss

(unaudited, in thousands, except share and per share data)

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

Collaboration revenue

 

$

 

 

$

94

 

 

$

170,000

 

 

$

430

 

Grant revenue

 

 

 

 

 

 

 

 

 

 

 

762

 

Total revenue

 

 

 

 

 

94

 

 

 

170,000

 

 

 

1,192

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

90,698

 

 

 

116,622

 

 

 

292,188

 

 

 

358,090

 

General and administrative

 

 

18,291

 

 

 

27,001

 

 

 

59,683

 

 

 

81,295

 

Collaboration expense, net

 

 

23,422

 

 

 

38,859

 

 

 

110,250

 

 

 

103,427

 

Total operating expenses

 

 

132,411

 

 

 

182,482

 

 

 

462,121

 

 

 

542,812

 

Loss from operations

 

 

(132,411

)

 

 

(182,388

)

 

 

(292,121

)

 

 

(541,620

)

Other income:

 

 

 

 

 

 

 

 

 

 

 

 

Other income, net

 

 

20,671

 

 

 

7,264

 

 

 

51,819

 

 

 

11,171

 

Total other income, net

 

 

20,671

 

 

 

7,264

 

 

 

51,819

 

 

 

11,171

 

Net loss before income taxes

 

 

(111,740

)

 

 

(175,124

)

 

 

(240,302

)

 

 

(530,449

)

(Provision) benefit for income taxes

 

 

(412

)

 

 

575

 

 

 

(2,655

)

 

 

(9,151

)

Net loss

 

 

(112,152

)

 

 

(174,549

)

 

 

(242,957

)

 

 

(539,600

)

Foreign currency translation adjustment

 

 

(49

)

 

 

(100

)

 

 

12

 

 

 

(195

)

Unrealized gain (loss) on marketable securities

 

 

2,160

 

 

 

(1,820

)

 

 

8,838

 

 

 

(17,001

)

Comprehensive loss

 

$

(110,041

)

 

$

(176,469

)

 

$

(234,107

)

 

$

(556,796

)

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per common share — basic

 

$

(1.41

)

 

$

(2.24

)

 

$

(3.07

)

 

$

(6.96

)

Basic weighted-average common shares outstanding

 

 

79,414,098

 

 

 

78,021,520

 

 

 

79,063,415

 

 

 

77,547,771

 

Net loss per common share — diluted

 

$

(1.41

)

 

$

(2.24

)

 

$

(3.07

)

 

$

(6.96

)

Diluted weighted-average common shares outstanding

 

 

79,414,098

 

 

 

78,021,520

 

 

 

79,063,415

 

 

 

77,547,771

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

3


 

CRISPR Therapeutics AG

Condensed Consolidated Statements of Shareholders’ Equity

(unaudited, in thousands, except share and per share data)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

Common Shares

 

Treasury Shares

 

 

 

 

 

 

 

 

 

 

Shares

 

CHF 0.03
Nominal Value

 

Shares

 

Amount,
at cost

 

Additional
Paid-in
Capital

 

Accumulated
Deficit

 

Accumulated
Other
Comprehensive
Loss

 

Total
Shareholders’
Equity

 

Balance at December 31, 2021

 

76,990,066

 

$

2,391

 

 

180,316

 

$

(63

)

$

2,598,114

 

$

(195,915

)

$

(5,067

)

$

2,399,460

 

Vesting of restricted shares

 

123,564

 

 

4

 

 

 

 

 

 

 

 

 

 

 

 

4

 

Exercise of vested options, net of issuance costs of $0.2 million

 

261,280

 

 

12

 

 

 

 

 

 

9,998

 

 

 

 

 

 

10,010

 

Purchase of common stock under ESPP

 

11,495

 

 

 

 

 

 

 

 

740

 

 

 

 

 

 

740

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

25,745

 

 

 

 

 

 

25,745

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

(11,826

)

 

(11,826

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

(179,217

)

 

 

 

(179,217

)

Balance at March 31, 2022

 

77,386,405

 

$

2,407

 

 

180,316

 

$

(63

)

$

2,634,597

 

$

(375,132

)

$

(16,893

)

$

2,244,916

 

Vesting of restricted shares

 

14,705

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercise of vested options, net of issuance costs of $0.2 million

 

391,053

 

 

13

 

 

 

 

 

 

10,333

 

 

 

 

 

 

10,346

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

24,852

 

 

 

 

 

 

24,852

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

(3,449

)

 

(3,449

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

(185,834

)

 

 

 

(185,834

)

Balance at June 30, 2022

 

77,792,163

 

$

2,420

 

 

180,316

 

$

(63

)

$

2,669,782

 

$

(560,966

)

$

(20,342

)

$

2,090,831

 

Issuance of common shares

 

12,365

 

 

 

 

 

 

 

 

970

 

 

 

 

 

 

970

 

Vesting of restricted shares

 

17,128

 

 

1

 

 

 

 

 

 

 

 

 

 

 

 

1

 

Exercise of vested options, net of issuance costs of $0.3 million

 

401,110

 

 

12

 

 

 

 

 

 

12,770

 

 

 

 

 

 

12,782

 

Purchase of common stock under ESPP

 

25,064

 

 

 

 

 

 

 

 

1,296

 

 

 

 

 

 

1,296

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

24,543

 

 

 

 

 

 

24,543

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,920

)

 

(1,920

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

(174,549

)

 

 

 

(174,549

)

Balance at September 30, 2022

 

78,247,830

 

$

2,433

 

 

180,316

 

$

(63

)

$

2,709,361

 

$

(735,515

)

$

(22,262

)

$

1,953,954

 

 

 

4


 

 

Common Shares

 

Treasury Shares

 

 

 

 

 

 

 

 

 

 

Shares

 

CHF 0.03
Nominal Value

 

Shares

 

Amount,
at cost

 

Additional
Paid-in
Capital

 

Accumulated
Deficit

 

Accumulated
Other
Comprehensive
Loss

 

Total
Shareholders’
Equity

 

Balance at December 31, 2022

 

78,512,450

 

$

2,441

 

 

180,316

 

$

(63

)

$

2,734,838

 

$

(846,090

)

$

(15,647

)

$

1,875,479

 

Vesting of restricted shares

 

172,995

 

 

5

 

 

 

 

 

 

 

 

 

 

 

 

5

 

Exercise of vested options, net of issuance costs of $0.2 million

 

159,184

 

 

6

 

 

 

 

 

 

4,677

 

 

 

 

 

 

4,683

 

Purchase of common stock under ESPP

 

19,105

 

 

 

 

 

 

 

 

660

 

 

 

 

 

 

660

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

20,875

 

 

 

 

 

 

20,875

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

6,259

 

 

6,259

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(53,065

)

 

 

 

(53,065

)

Balance at March 31, 2023

 

78,863,734

 

$

2,452

 

 

180,316

 

$

(63

)

$

2,761,050

 

$

(899,155

)

$

(9,388

)

$

1,854,896

 

Vesting of restricted shares

 

97,631

 

 

4

 

 

 

 

 

 

 

 

 

 

 

 

4

 

Exercise of vested options, net of issuance costs of $0.3 million

 

411,001

 

 

18

 

 

 

 

 

 

16,605

 

 

 

 

 

 

16,623

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

21,765

 

 

 

 

 

 

21,765

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

480

 

 

480

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(77,740

)

 

 

 

(77,740

)

Balance at June 30, 2023

 

79,372,366

 

$

2,474

 

 

180,316

 

$

(63

)

$

2,799,420

 

$

(976,895

)

$

(8,908

)

$

1,816,028

 

Vesting of restricted shares

 

3,305

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercise of vested options

 

16,900

 

 

2

 

 

 

 

 

 

645

 

 

 

 

 

 

647

 

Purchase of common stock under ESPP

 

34,177

 

 

 

 

 

 

 

 

1,192

 

 

 

 

 

 

1,192

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

19,968

 

 

 

 

 

 

19,968

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

2,111

 

 

2,111

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(112,152

)

 

 

 

(112,152

)

Balance at September 30, 2023

 

79,426,748

 

$

2,476

 

 

180,316

 

$

(63

)

$

2,821,225

 

$

(1,089,047

)

$

(6,797

)

$

1,727,794

 

 

5


 

CRISPR Therapeutics AG

Condensed Consolidated Statements of Cash Flows

(unaudited, in thousands)

 

 

 

Nine Months Ended September 30,

 

 

 

2023

 

 

2022

 

Operating activities:

 

 

 

 

 

 

Net loss

 

$

(242,957

)

 

$

(539,600

)

Reconciliation of net loss to net cash used in operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

14,937

 

 

 

18,326

 

Equity-based compensation

 

 

62,608

 

 

 

75,142

 

Other non-cash items, net

 

 

(11,779

)

 

 

12,251

 

Acquired in-process research and development

 

 

2,500

 

 

 

 

Changes in:

 

 

 

 

 

 

Accounts receivable