Restructuring

6 Months Ended

Jun. 30, 2024

Restructuring and Related Activities [Abstract]

In the three months ended June 30, 2024, in connection with the Company’s plans to reduce operational expenditures, management, with the approval of the Board of Directors, approved a restructuring plan. This plan includes an expected reduction in labor expenses, primarily through a workforce reduction of at least 35%, and a planned consolidation and sublease of certain facilities. Initial workforce reductions commenced in June 2024, with further reductions expected in the second half of 2024. All reductions are expected to be substantially completed in 2025, subject to compliance with

applicable laws. The Company plans to consolidate certain facilities through various actions, including the consolidation of office and laboratory operations into fewer locations, subleasing unused facilities, and other related measures. While the Company aims to complete the majority of its facility consolidation actions in 2025, the actual timing may vary.

The costs for the reduction in force are expected to range from $18.0 million to $22.0 million primarily in the Cell Engineering segment and consist of one-time cash severance and related costs. The employee termination costs are recognized as of the communication date to employees, given (i) the Company instituted a one-time employee termination benefit related to its restructuring, and (ii) the employees will not be retained to render service beyond a minimum retention period. The Company is currently unable to estimate the costs associated with consolidating its facilities. These costs may include, but are not limited to, losses on subleases, contract terminations, asset impairments, sale or disposal of equipment or other long-lived assets, and related costs and fees pertaining to the consolidation, closure, or disposition of facilities. Additional charges may be incurred as the Company progresses its restructuring plan and such charges could be material.

During the three and six months ended June 30, 2024, the Company incurred $17.1 million in restructuring costs, which are recorded as “Restructuring charges” in the condensed consolidated statements of operations and comprehensive loss.

The following table presents details of expenses incurred including a summary of the changes in the accrued liability balance related to the restructuring activities, which is included in “Accounts payable” and “Accrued expenses and other current liabilities” in the accompanying condensed consolidated balance sheet as of June 30, 2024 (in thousands):


	Employee Termination Costs and Other		Impairment of Right-of-Use Asset (1)		Total
Expenses incurred	$	12,243	$	4,823	$	17,066
Cash payments	(489)
Liability balance at June 30, 2024	$	11,754

(1) Relates to a decision to sublease a certain facility in connection with the restructuring and reflects the excess of the right-of-use asset's carrying value over its fair value, which was determined based on estimates of future discounted cash flows and is classified as Level 3 in the fair value hierarchy.