10-Q 1 crsp-20220630.htm 10-Q 10-Q
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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 June 30, 2022

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 August 4, 2022, there were 78,009,260 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, “COBALTTM,” “CTX001TM,” “CTX110®,” “CTX112TM,” “CTX120TM,” “CTX121TM,” “CTX130TM,” “CTX131TM,” “CRISPR TXTM,” “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 our various clinical programs including those for exa-cel (formerly known as CTX001TM), CTX110®, CTX130TM and VCTX210TM;
the status of clinical trials, development timelines 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 our ongoing clinical trials and any planned clinical trials for exa-cel, CTX110, CTX130 and VCTX210, and our research and development programs, including delays or disruptions in clinical trials, non-clinical experiments and investigational new drug 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 European 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;
the therapeutic value, development, and commercial potential of CRISPR/Cas9 gene-editing technologies and therapies; and
potential impacts due to the ongoing coronavirus pandemic such as delays, interruptions or other adverse effects to clinical trials, delays in regulatory review, manufacturing and supply chain interruptions, adverse effects on healthcare systems and disruption of the global economy, and the overall impact of the coronavirus pandemic on our business, financial condition and results of operations.

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 15, 2022, 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 June 30, 2022 and December 31, 2021

2

 

 

Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income for the three and six months ended June 30, 2022 and 2021

3

 

 

Condensed Consolidated Statements of Shareholders’ Equity for the three and six months ended June 30, 2022 and 2021

4

 

 

Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2022 and 2021

5

 

 

Notes to Condensed Consolidated Financial Statements

6

 

 

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

17

 

 

Item 3. Quantitative and Qualitative Disclosures about Market Risk

27

 

 

Item 4. Controls and Procedures

28

 

 

PART II: OTHER INFORMATION

 

 

 

Item 1. Legal Proceedings

29

 

 

Item 1A. Risk Factors

29

 

 

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

29

 

 

Item 3. Defaults Upon Senior Securities

29

 

 

Item 4. Mine Safety Disclosures

29

 

 

Item 5. Other Information

29

 

 

Item 6. Exhibits

30

 

 

SIGNATURES

31

 


 

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

 

 

 

June 30,

 

 

December 31,

 

 

 

2022

 

 

2021

 

Assets

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

496,893

 

 

$

923,031

 

Marketable securities

 

 

1,568,446

 

 

 

1,456,098

 

Accounts receivable

 

 

66

 

 

 

305

 

Prepaid expenses and other current assets

 

 

41,651

 

 

 

38,079

 

Total current assets

 

 

2,107,056

 

 

 

2,417,513

 

Property and equipment, net

 

 

165,194

 

 

 

137,575

 

Marketable securities, non-current

 

 

8,392

 

 

 

 

Intangible assets, net

 

 

98

 

 

 

125

 

Restricted cash

 

 

12,123

 

 

 

16,913

 

Operating lease assets

 

 

166,740

 

 

 

174,460

 

Other non-current assets

 

 

3,760

 

 

 

5,291

 

Total assets

 

$

2,463,363

 

 

$

2,751,877

 

Liabilities and shareholders’ equity

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

25,244

 

 

$

14,816

 

Accrued expenses

 

 

82,223

 

 

 

91,003

 

Deferred revenue, current

 

 

 

 

 

1,011

 

Accrued tax liabilities

 

 

3,953

 

 

 

724

 

Operating lease liabilities

 

 

8,267

 

 

 

12,158

 

Other current liabilities

 

 

270

 

 

 

171

 

Total current liabilities

 

 

119,957

 

 

 

119,883

 

Deferred revenue, non-current

 

 

12,323

 

 

 

12,323

 

Operating lease liabilities, net of current portion

 

 

234,160

 

 

 

212,872

 

Other non-current liabilities

 

 

6,092

 

 

 

7,339

 

Total liabilities

 

 

372,532

 

 

 

352,417

 

Commitments and contingencies, see Note 6

 

 

 

 

 

 

Shareholders’ equity:

 

 

 

 

 

 

Common shares, CHF 0.03 par value, 150,347,467 and 145,364,335 shares authorized at
  June 30, 2022 and December 31, 2021, respectively,
77,972,479 and 77,170,382
  shares issued at June 30, 2022 and December 31, 2021, respectively,
77,792,163 and
  
76,990,066 shares outstanding at June 30, 2022 and December 31, 2021, respectively

 

 

2,420

 

 

 

2,391

 

Treasury shares, at cost, 180,316 shares at June 30, 2022 and at December 31, 2021

 

 

(63

)

 

 

(63

)

Additional paid-in capital

 

 

2,669,782

 

 

 

2,598,114

 

Accumulated deficit

 

 

(560,966

)

 

 

(195,915

)

Accumulated other comprehensive loss

 

 

(20,342

)

 

 

(5,067

)

Total shareholders' equity

 

 

2,090,831

 

 

 

2,399,460

 

Total liabilities and shareholders’ equity

 

$

2,463,363

 

 

$

2,751,877

 

 

 

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) Income

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

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

June 30,

 

 

June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

Collaboration revenue

 

$

158

 

 

$

900,202

 

 

$

336

 

 

$

900,404

 

Grant revenue

 

 

 

 

 

499

 

 

 

762

 

 

 

836

 

Total revenue

 

 

158

 

 

 

900,701

 

 

 

1,098

 

 

 

901,240

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

123,223

 

 

 

82,332

 

 

 

241,468

 

 

 

153,971

 

General and administrative

 

 

26,273

 

 

 

28,806

 

 

 

54,294

 

 

 

52,303

 

Collaboration expense, net

 

 

33,922

 

 

 

26,945

 

 

 

64,568

 

 

 

46,891

 

Total operating expenses

 

 

183,418

 

 

 

138,083

 

 

 

360,330

 

 

 

253,165

 

(Loss) income from operations

 

 

(183,260

)

 

 

762,618

 

 

 

(359,232

)

 

 

648,075

 

Other income:

 

 

 

 

 

 

 

 

 

 

 

 

Other income, net

 

 

3,544

 

 

 

750

 

 

 

3,907

 

 

 

2,705

 

Total other income, net

 

 

3,544

 

 

 

750

 

 

 

3,907

 

 

 

2,705

 

Net (loss) income before income taxes

 

 

(179,716

)

 

 

763,368

 

 

 

(355,325

)

 

 

650,780

 

Provision for income taxes

 

 

(6,118

)

 

 

(4,143

)

 

 

(9,726

)

 

 

(4,718

)

Net (loss) income

 

 

(185,834

)

 

 

759,225

 

 

 

(365,051

)

 

 

646,062

 

Foreign currency translation adjustment

 

 

(69

)

 

 

5

 

 

 

(95

)

 

 

10

 

Unrealized loss on marketable securities

 

 

(3,380

)

 

 

(173

)

 

 

(15,180

)

 

 

(556

)

Comprehensive (loss) income

 

$

(189,283

)

 

$

759,057

 

 

$

(380,326

)

 

$

645,516

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income per common share — basic

 

$

(2.40

)

 

$

10.01

 

 

$

(4.72

)

 

$

8.57

 

Basic weighted-average common shares outstanding

 

 

77,513,327

 

 

 

75,826,594

 

 

 

77,306,970

 

 

 

75,418,160

 

Net (loss) income per common share — diluted

 

$

(2.40

)

 

$

9.44

 

 

$

(4.72

)

 

$

8.03

 

Diluted weighted-average common shares outstanding

 

 

77,513,327

 

 

 

80,449,956

 

 

 

77,306,970

 

 

 

80,458,855

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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)

 

 

Common Shares

 

Treasury Shares

 

 

 

 

 

 

 

 

 

 

Shares

 

CHF 0.03
Par Value

 

Shares

 

Amount,
at cost

 

Additional
Paid-in
Capital

 

Accumulated Deficit

 

Accumulated
Other
Comprehensive
Loss

 

Total
Shareholders’
Equity

 

Balance at December 31, 2020

 

73,914,844

 

$

2,277

 

 

195,316

 

$

(63

)

$

2,235,679

 

$

(573,576

)

$

(83

)

$

1,664,234

 

Issuance of common shares, net of issuance costs of $5.4 million

 

1,353,121

 

 

45

 

 

 

 

 

 

222,130

 

 

 

 

 

 

222,175

 

Vesting of restricted shares

 

109,355

 

 

3

 

 

 

 

 

 

 

 

 

 

 

 

3

 

Exercise of vested options, net of issuance costs of $1.5 million

 

342,051

 

 

15

 

 

 

 

 

 

9,769

 

 

 

 

 

 

9,784

 

Purchase of common stock under ESPP

 

11,257

 

 

 

 

 

 

 

 

751

 

 

 

 

 

 

751

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

22,092

 

 

 

 

 

 

22,092

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

(378

)

 

(378

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

(113,163

)

 

 

 

(113,163

)

Balance at March 31, 2021

 

75,730,628

 

$

2,340

 

 

195,316

 

$

(63

)

$

2,490,421

 

$

(686,739

)

$

(461

)

$

1,805,498

 

Issuance of common shares, net of issuance costs of $5.4 million

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vesting of restricted shares

 

3,667

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercise of vested options, net of issuance costs of $0.4 million

 

344,158

 

 

12

 

 

 

 

 

 

10,897

 

 

 

 

 

 

10,909

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

28,331

 

 

 

 

 

 

28,331

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

(168

)

 

(168

)

Net income

 

 

 

 

 

 

 

 

 

 

 

759,225

 

 

 

 

759,225

 

Balance at June 30, 2021

 

76,078,453

 

$

2,352

 

 

195,316

 

$

(63

)

$

2,529,649

 

$

72,486

 

$

(629

)

$

2,603,795

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

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

4


 

CRISPR Therapeutics AG

Condensed Consolidated Statements of Cash Flows

(unaudited, in thousands)

 

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

Operating activities:

 

 

 

 

 

 

Net (loss) income

 

$

(365,051

)

 

$

646,062

 

Reconciliation of net (loss) income to net cash used in operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

13,308

 

 

 

6,368

 

Equity-based compensation

 

 

50,597

 

 

 

50,423

 

Other non-cash items, net

 

 

9,671

 

 

 

4,417

 

Changes in:

 

 

 

 

 

 

Accounts receivable

 

 

239

 

 

 

(6

)

Prepaid expenses and other assets

 

 

2,032

 

 

 

(9,470

)

Accounts payable and accrued expenses

 

 

8,303

 

 

 

13,427

 

Deferred revenue

 

 

(1,011

)

 

 

(271

)

Operating lease assets and liabilities