PepGen Inc

Previous wording

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q, or 10-Q. Some of the information contained in this discussion and analysis or set forth elsewhere in this 10-Q, including information with respect to our plans, strategies, objectives, expectations and intentions for our business and related financing, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the “Risk Factors” section of this 10-Q, our actual results could differ materially from the results described in or implied by these forward-looking statements. Please also see the section titled “Special Note Regarding Forward-Looking Statements.”

Current wording

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes included elsewhere in this 10-Q. Some of the information contained in this discussion and analysis or set forth elsewhere in this 10-Q, including information with respect to our plans, strategies, objectives, expectations and intentions for our business and related financing, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the “Risk Factors” section of this 10-Q, our actual results could differ materially from the results described in or implied by these forward-looking statements. Please also see the section titled “Special Note Regarding Forward-Looking Statements.”

Previous wording

Our clinical development program for PGN-EDO51 comprises two parallel Phase 2 studies of PGN-EDO51 in DMD patients whose mutations are amenable to an exon 51-skipping approach. The first study, CONNECT1-EDO51, or CONNECT1, is an ongoing open-label, multiple ascending dose, or MAD, Phase 2 study in boys and young men living with DMD being conducted in Canada. We initiated dosing patients in CONNECT1 in January 2024 and have fully enrolled the first cohort at the 5 mg/kg PGN-EDO51 dose level. We anticipate reporting preliminary data, including safety, exon skipping and dystrophin production, for this cohort in mid-2024.

Current wording

Our clinical development program for PGN-EDO51 comprises two parallel Phase 2 studies of PGN-EDO51 in DMD patients whose mutations are amenable to an exon 51-skipping approach. The first study, CONNECT1-EDO51, or CONNECT1, is an ongoing open-label, multiple ascending dose, or MAD, Phase 2 study in boys and young men living with DMD being conducted in Canada. The CONNECT1 study was designed to provide proof-of-concept for our EDO platform and PGN-EDO51, as well as inform the design and conduct of our CONNECT2-EDO51, or CONNECT2, study. In July 2024, we reported initial clinical data from the CONNECT1 study from the 5 mg/kg starting dose cohort (n=3). PGN-EDO51 produced mean exon skipping in biceps tissue of 2.15% at week 13 compared to baseline, measured by RT-PCR. In addition, PGN-EDO51 achieved a mean muscle-adjusted dystrophin level of 1.49% of normal (0.70% increase from baseline) and a mean absolute dystrophin level (by Western blot analysis) of 0.61% of normal (0.26% increase from baseline), in each case after four doses, measured at week 13. The 5 mg/kg dose of PGN-EDO51 was well tolerated by all study cohort participants through week 13. There were no discontinuations, dose interruptions or dose reductions. The one related treatment-emergent adverse event was mild and resolved. There was no sustained elevation in kidney biomarkers. There were no cases of hypomagnesemia or hypokalemia. There were also no changes in electrolytes or hepatic function and no cases of anemia or thrombocytopenia. As of July 29, 2024, all three patients in this cohort were continuing to be dosed with PGN-EDO51 at 5 mg/kg in the long-term extension, or LTE, phase of the clinical trial and PGN-EDO51 was well tolerated during the LTE as of such date. As of July 29, 2024, two participants had received a total of four doses at 10 mg/kg in the ongoing CONNECT1 study, and as of such date, PGN-EDO51 had been generally well tolerated at this dose level. We expect to report initial results from the 10 mg/kg cohort in early 2025.

Previous wording

In February 2024, we received clearance from the Medicines and Healthcare products Regulatory Agency, or MHRA, to initiate the second study, CONNECT2-EDO51, or CONNECT2, a Phase 2, multinational, randomized, double-blind, placebo-controlled MAD study, in the United Kingdom, or U.K. The CONNECT2 study will evaluate multiple dose cohorts and trial participants will be administered PGN-EDO51 once every four weeks for six months. We will assess safety, tolerability, exon skipping, dystrophin expression and functional outcomes in this study. The CONNECT2 study, together with data from the CONNECT1 study, is designed to support a potential accelerated approval pathway for PGN-EDO51, subject to regulatory authority feedback. In March 2024, we announced that the U.S. Food and Drug Administration, or FDA granted both orphan drug designation and rare pediatric disease designations for PGN-EDO51 for the treatment of DMD patients who are amenable to exon 51 skipping.

Current wording

The second Phase 2 study of PGN-EDO51, CONNECT2, is a multinational, randomized, double-blind, placebo-controlled MAD study. The CONNECT2 study will evaluate multiple dose cohorts and trial participants will be administered PGN-EDO51 once every four weeks for six months. We will assess safety, tolerability, exon skipping, dystrophin expression and functional outcomes in this study. Based on the data from CONNECT1, including PGN-EDO51’s emerging safety profile to date, we are working to optimize the design of the CONNECT2 trial. The CONNECT2 study, together with data from the CONNECT1 study, is intended to support a potential accelerated approval pathway for PGN-EDO51, subject to regulatory authority feedback.

Previous wording

We are also developing PGN-EDODM1 for the treatment of DM1 and are utilizing what we believe to be a unique mechanism of action and a different delivery approach compared to other approaches in more advanced stages of clinical development. We have conducted extensive preclinical studies of our product candidate, and these preclinical data form the basis of our clinical development plan for PGN-EDODM1. In May 2023, we announced that we received a clinical hold notice from the FDA, regarding our investigational new drug, or IND, application to initiate our first-in-human Phase 1 FREEDOM-DM1, or FREEDOM, study. In September 2023, we announced that Health Canada had cleared our Clinical Trial Application, or CTA, for the FREEDOM study in Canada. In October 2023, we announced that the FDA lifted the clinical hold on the FREEDOM study, allowing this study to proceed in the U.S. In December 2023, we announced that the MHRA had cleared our CTA for the FREEDOM study in the U.K. and we began dosing patients in this study. FREEDOM is a multinational, randomized, double-blind, placebo-controlled, single ascending dose, or SAD, study designed to assess PGN-EDODM1’s safety and tolerability, splicing correction and functional outcome measures in DM1 patients. We expect to report preliminary data from this study in the second half of 2024. In February 2024, we announced that PGN-EDODM1 received Fast Track designation from the FDA for the treatment of DM1. The FDA has also previously granted orphan drug designation for PGN-EDODMI. We also expect to open the FREEDOM2-DM1 Phase 2 randomized, double blind, placebo-controlled MAD study in DM1 patients in the second half of 2024.

Current wording

We are also developing PGN-EDODM1 for the treatment of DM1 and are utilizing what we believe to be a unique mechanism of action and a different delivery approach compared to other approaches in more advanced stages of clinical development. We have conducted extensive preclinical studies of our product candidate, and these preclinical data form the basis of our clinical development plan for PGN-EDODM1. In May 2023, we announced that we received a clinical hold notice from the FDA, regarding our investigational new drug, or IND, application to initiate our first-in-human Phase 1 FREEDOM-DM1, or FREEDOM, study. In September 2023, we announced that Health Canada had cleared our Clinical Trial Application, or CTA, for the FREEDOM study in Canada. In October 2023, we announced that the FDA lifted the clinical hold on the FREEDOM study, allowing this study to proceed in the U.S. In December 2023, we announced that the MHRA had cleared our CTA for the FREEDOM study in the U.K. and we began dosing patients in this study. FREEDOM is a multinational, randomized, double-blind, placebo-controlled, single ascending dose, or SAD, study designed to assess PGN-EDODM1’s safety and tolerability, splicing correction and functional outcome measures in DM1 patients. We expect to report preliminary data from this study in the fourth quarter of 2024.

Previous wording

In addition to these lead candidates, we are developing EDO candidates for additional DMD sub-populations amenable to skipping of other exons, including exon 53, 45 and 44. We have previously reported robust exon 53-skipping levels following either a single dose or multiple doses in non-human primates, or NHPs, for our PGN-EDO53 program. We continue to advance PGN-EDO53 into CTA and/or IND-enabling preclinical studies.

Current wording

In addition to these lead candidates, we are developing EDO candidates for additional DMD sub-populations amenable to skipping of other exons, including exon 53, 45 and 44. We have previously reported robust exon 53-skipping levels following either a single dose or multiple doses in non-human primates, or NHPs, for our PGN-EDO53 program. We continue to advance PGN-EDO53 in CTA and/or IND-enabling preclinical studies.

Previous wording

We have incurred operating losses in each year since our inception. Our net losses were $18.0 million and $16.3 million for the three months ended March 31, 2024 and March 31, 2023, respectively. As of March 31, 2024, we had cash, cash equivalents, and marketable securities of $175.2 million. As of March 31, 2024, we had an accumulated deficit of $199.5 million. We expect our expenses and operating losses will continue as we conduct our ongoing preclinical studies and current and planned clinical trials, continue our research and development activities, utilize third parties to manufacture our product candidates and related raw materials, hire additional personnel, protect our intellectual property and incur additional costs associated with being a public company, including audit, legal, regulatory, and tax-related services associated with maintaining compliance with an exchange listing and SEC, requirements, director and officer insurance premiums, and investor relations costs. In addition, we have several development, regulatory and commercial milestone payment obligations under our licensing arrangements. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our preclinical studies and current and planned clinical trials and our expenditures on other research and development activities.

Current wording

We have incurred operating losses in each year since our inception. Our net losses were $46.4 million and $35.8 million for the six months ended June 30, 2024 and June 30, 2023, respectively. As of June 30, 2024, we had cash, cash equivalents, and marketable securities of $161.3 million. As of June 30, 2024, we had an accumulated deficit of $227.8 million. We expect our expenses and operating losses will continue as we conduct our ongoing preclinical studies and current and planned clinical trials, continue our research and development activities, utilize third parties to manufacture our product candidates and related raw materials, hire additional personnel, protect our intellectual property and incur additional costs associated with being a public company, including audit, legal, regulatory, and tax-related services associated with maintaining compliance with an exchange listing and SEC, requirements, director and officer insurance premiums, and investor relations costs. In addition, we have several development, regulatory and commercial milestone payment obligations under our licensing arrangements. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our preclinical studies and current and planned clinical trials and our expenditures on other research and development activities.

Previous wording

Based on our current operating plans, we believe that our existing cash, cash equivalents and marketable securities, will be sufficient to fund our operations into 2026. We do not expect to generate any revenues from product sales unless and until we successfully complete development and obtain regulatory approval for one or more of our product candidates, which will not be for at least the next several years, if ever. If we obtain regulatory approval for any of our product candidates, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing and distribution. Accordingly, until such time as we can generate significant revenue from sales of our product candidates, if ever, we expect to finance our cash needs through equity offerings, debt financings or other capital sources, including potential collaborations, licenses and other similar arrangements. However, we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all. Our failure to raise capital or enter into such other arrangements when needed would have a negative impact on our financial condition and could force us to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

Current wording

Based on our currently planned operations, we believe that our existing cash, cash equivalents and marketable securities, will be sufficient to fund our operations into 2026. We do not expect to generate any revenues from product sales unless and until we successfully complete development and obtain regulatory approval for one or more of our product candidates, which will not be for at least the next several years, if ever. If we obtain regulatory approval for any of our product candidates, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing and distribution. Accordingly, until such time as we can generate significant revenue from sales of our product candidates, if ever, we expect to finance our cash needs through equity offerings, debt financings or other capital sources, including potential collaborations, licenses and other similar arrangements. However, we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all. Our failure to raise capital or enter into such other arrangements when needed would have a negative impact on our financial condition and could force us to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

Previous wording

We were initially formed as PepGen Limited on January 25, 2018, in the U.K. On November 9, 2020, PepGen Limited initiated a corporate reorganization, or the Reorganization. As part of the Reorganization, PepGen Limited formed PepGen Inc., a Delaware corporation with nominal assets and liabilities, for the purpose of consummating the Reorganization. In connection with the Reorganization, the existing shareholders of PepGen Limited exchanged each of their classes of shares of PepGen Limited for the same number and class of common stock of PepGen Inc. on a one-to-one basis. The newly issued stock of PepGen Inc. had substantially identical rights to the exchanged shares of PepGen Limited. As a result of the exchange, PepGen Inc. became the sole shareholder of PepGen Limited. Upon the completion of the Reorganization on November 23, 2020, the historical financial statements of PepGen Limited became the historical financial statements of PepGen Inc., as the Reorganization was deemed to be between entities under common control.

Current wording

We were initially formed as PepGen Limited on January 25, 2018, in the U.K. On November 9, 2020, PepGen Limited initiated a corporate reorganization, or the Reorganization. As part of the Reorganization, PepGen Limited formed PepGen, a Delaware corporation with nominal assets and liabilities, for the purpose of consummating the Reorganization. In connection with the Reorganization, the existing shareholders of PepGen Limited exchanged each of their classes of shares of PepGen Limited for the same number and class of common stock of PepGen on a one-to-one basis. The newly issued stock of PepGen had substantially identical rights to the exchanged shares of PepGen Limited. As a result of the exchange, PepGen became the sole shareholder of PepGen Limited. Upon the completion of the Reorganization on November 23, 2020, the historical financial statements of PepGen Limited became the historical financial statements of PepGen, as the Reorganization was deemed to be between entities under common control.

Previous wording

After the Reorganization was completed, PepGen Limited began the process of transferring operations, including financial management functions, to PepGen Inc. pursuant to an intercompany services agreement, effective as of April 2021, and certain assets, including a novation of all intellectual property assets, pursuant to an asset transfer agreement, effective as of January 1, 2022. After the transfer of intellectual property and other assets from PepGen Limited to PepGen Inc., there were limited operations through the end of 2022 at PepGen Limited.

Current wording

After the Reorganization was completed, PepGen Limited began the process of transferring operations, including financial management functions, to PepGen pursuant to an intercompany services agreement, effective as of April 2021, and certain assets, including a novation of all intellectual property assets, pursuant to an asset transfer agreement, effective as of January 1, 2022. After the transfer of intellectual property and other assets from PepGen Limited to PepGen, there were limited operations through the end of 2022 at PepGen Limited.

Previous wording

The following table (in thousands) summarizes our research and development expenses for the three months ended March 31, 2024 and March 31, 2023. The direct external development program expenses reflect external costs attributable to our clinical development candidates and preclinical candidates selected for further development. Our internal resources, personnel and infrastructure are not directly tied to any one research or drug discovery program and are typically deployed across multiple programs. As such, we do not track internal expenses on a program-specific basis.

Current wording

The following table (in thousands) summarizes our research and development expenses for the three and six months ended June 30, 2024 and June 30, 2023. The direct external development program expenses reflect external costs attributable to our clinical development candidates and preclinical candidates selected for further development. Our internal resources, personnel and infrastructure are not directly tied to any one research or drug discovery program and are typically deployed across multiple programs. As such, we do not track internal expenses on a program-specific basis.

Previous wording

We plan to increase our research and development expenses in the remainder of 2024 as we conduct our ongoing CONNECT1 and CONNECT2 Phase 2 clinical trials for PGN-EDO51, and our ongoing FREEDOM Phase 1 clinical trial and our planned FREEDOM2 Phase 2 clinical trial for PGN-EDODM1. Additionally, we continue to conduct our ongoing research and development activities, and advance our preclinical research programs toward clinical development, including conducting IND- and CTA-enabling studies for PGN-EDO53. The process of conducting preclinical studies and clinical trials necessary to obtain regulatory approval is costly and time consuming. We may never succeed in achieving marketing approval for any of our product candidates.

Current wording

We expect to increase our research and development expenses in the remainder of 2024 as we conduct our ongoing Phase 2 clinical trials for PGN-EDO51 and our ongoing Phase 1 clinical trial of PGN-EDODM1, and potentially initiate dosing in our FREEDOM2 Phase 2 clinical trial for PGN-EDODM1, and increase our headcount to support these programs. Additionally, we continue to conduct our ongoing research and development activities, and advance our preclinical research programs toward clinical development, including conducting IND- and CTA-enabling studies for PGN-EDO53. The process of conducting preclinical studies and clinical trials necessary to obtain regulatory approval is costly and time consuming. We may never succeed in achieving marketing approval for any of our product candidates.

Previous wording

We anticipate that our general and administrative expenses will remain consistent in 2024 as compared to 2023 to support our public company operating expenses associated with audit, legal, regulatory, and tax-related services associated with maintaining compliance with our exchange listing and SEC requirements, director and officer insurance premiums, and investor relations.

Current wording

We anticipate that our general and administrative expenses will increase in 2024 as compared to 2023 primarily due to personnel costs, including stock-based compensation expense. Other general and administrative expenses will remain consistent to support our public company operating expenses associated with audit, legal, regulatory, and tax-related services associated with maintaining compliance with our exchange listing and SEC requirements, director and officer insurance premiums, and investor relations.

Previous wording

We have not recorded a U.S. provision for federal or state income taxes as we have no revenue and have incurred losses since inception. We had no tax liability for the three months ended March 31, 2024 or March 31, 2023.

Current wording

We have not recorded a U.S. provision for federal or state income taxes as we have no revenue and have incurred losses since inception. We had no tax liability for the three and six months ended June 30, 2024 or June 30, 2023.

Previous wording

Research and development expenses increased by $0.3 million from $14.4 million for the three months ended March 31, 2023, to $14.7 million for the three months ended March 31, 2024. This increase was attributable to spend related to the advancement of our clinical trials for our two lead programs, including a $2.1 million increase in clinical trial costs, a $1.3 million increase in personnel-related costs due to increased headcount, including an increase of $0.4 million in stock-based compensation expense, and a $0.4 million increase in facility and office related expenses related to rent expense on our lease agreement pursuant to which we lease office and laboratory space in Boston, Massachusetts, or the Harrison Lease, and depreciation on lab equipment. These increases were partially offset by a $2.8 million decrease in preclinical costs as our two lead programs are now in clinical trials, a $0.5 million decrease in manufacturing costs related to the timing of production, and a $0.3 million decrease in consultant costs from the prior year.

Current wording

Research and development expenses increased by $8.1 million from $16.9 million for the three months ended June 30, 2023, to $25.1 million for the three months ended June 30, 2024. This increase was attributable to expenses related to the advancement of clinical trials for our two lead programs, including a $4.0 million increase in clinical trial costs, a $5.3 million increase in manufacturing costs, and a $2.1 million increase in personnel-related costs, including an increase of $0.5 million in stock-based compensation expense. These increases were partially offset by a $3.1 million decrease in preclinical costs as our two lead programs are now in clinical trials, and a $0.2 million decrease in facility and other office related expenses.

Previous wording

Other income (expense), net was income of $1.7 million for the three months ended March 31, 2024 and $1.8 million for the three months ended March 31, 2023. Interest is earned through our cash deposits and U.S. Treasury-backed money market funds.

Current wording

Other income (expense), net was income of $2.1 million for the three months ended June 30, 2024 and $1.7 million for the three months ended June 30, 2023. Interest is earned through our cash deposits and U.S. Treasury-backed money market funds.

Previous wording

General and administrative expenses increased by $1.4 million from $3.7 million for the three months ended March 31, 2023, to $5.1 million for the three months ended March 31, 2024. The increase was primarily driven by an increase of $1.0 million in personnel-related costs due to increased headcount, including $0.5 million in stock-based compensation expense, and an increase of $0.3 million in facility and office related expenses related to rent expense for our Harrison Lease and depreciation on office furniture.

Current wording

General and administrative expenses increased by $2.5 million from $7.9 million for the six months ended June 30, 2023, to $10.4 million for the six months ended June 30, 2024. The increase was driven primarily by an increase of $2.2 million in personnel-related costs due to increased headcount, including $1.1 million in stock-based compensation expense, and an increase of $0.2 million in facility and office related expenses related to rent expense for our operating lease and depreciation on office furniture.

Previous wording

We filed a shelf registration statement on Form S-3 with the SEC, which covers the offering, issuance and sale of an amount up to $300.0 million in the aggregate of shares of our common stock, preferred stock, debt securities, warrants, and/or units or any combination thereof, which was declared effective on June 16, 2023.

Current wording

On June 2, 2023, we filed a shelf registration statement on Form S-3 with the SEC, which covers the offering, issuance and sale of an amount up to $300.0 million in the aggregate of shares of our common stock, preferred stock, debt securities, warrants, and/or units or any combination thereof, which was declared effective on June 16, 2023.

Previous wording

As of March 31, 2024, we had cash, cash equivalents, and marketable securities of $175.2 million. Based on our current operating plans, we believe that our existing cash, cash equivalents, and marketable securities will be sufficient to fund our operations into 2026. However, our forecast of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement that involves risks and uncertainties, and actual results could vary materially. We have based this estimate on assumptions that may prove to be wrong, and we could deplete our capital resources sooner than we expect. Additionally, the process of conducting preclinical studies and testing product candidates in clinical trials is costly, and the timing of progress and expenses in these studies and trials is uncertain.

Current wording

As of June 30, 2024, we had cash, cash equivalents, and marketable securities of $161.3 million. Based on our currently planned operations, we believe that our existing cash, cash equivalents, and marketable securities will be sufficient to fund our operations into 2026. However, our forecast of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement that involves risks and uncertainties, and actual results could vary materially. We have based this estimate on assumptions that may prove to be wrong, and we could deplete our capital resources sooner than we expect. Additionally, the process of conducting preclinical studies and testing product candidates in clinical trials is costly, and the timing of progress and expenses in these studies and trials is uncertain.

Previous wording

The following table sets forth a summary of the net cash flow activity for the three months ended March 31, 2024 and March 31, 2023 (in thousands):

Current wording

The following table sets forth a summary of the net cash flow activity for the six months ended June 30, 2024 and June 30, 2023 (in thousands):

Previous wording

For the three months ended March 31, 2024, net cash used in operating activities was $22.5 million resulting from our net loss of $18.0 million and changes in our operating assets and liabilities of $6.3 million partially offset by non-cash charges of $1.8 million. The net changes in our operating assets and liabilities were primarily due to a decrease in accrued expenses of $6.8 million, an increase in prepaids and other current assets of $0.1 million, an increase in accounts payable of $0.1 million, and a decrease in operating lease liabilities of $0.3 million. The $6.8 million decrease in accrued expenses was primarily due to lower research and development accruals as a result of manufacturing timing, and the payment of our annual employee incentive bonus. The non-cash charges included $2.0 million of stock-based compensation, $0.4 million of depreciation expense, $0.5 million of amortization of discounts on our marketable securities, and $0.1 million of amortization and interest accretion on our operating lease.

Current wording

For the six months ended June 30, 2024, net cash used in operating activities was $38.9 million resulting from our net loss of $46.4 million, partially offset by changes in our operating assets and liabilities of $1.6 million and by non-cash charges of $5.8 million. The net changes in our operating assets and liabilities were primarily due to an increase in accounts payable of $6.6 million related to manufacturing commitments. The change was further driven by a decrease in accrued expenses of $2.3 million, an increase in prepaids and other current assets of $1.2 million, and a decrease in operating lease liabilities of $1.5 million. The $2.3 million decrease in accrued expenses was primarily due to lower research and development accruals as a result of manufacturing timing, and the payment of our annual employee incentive bonus. The non-cash charges included $4.9 million of stock-based compensation, $0.7 million of depreciation expense, $1.7 million of amortization of discounts on our marketable securities, and $1.9 million of amortization and interest accretion on our operating lease.

Previous wording

For the three months ended March 31, 2023, net cash used in operating activities was $15.4 million resulting from our net loss of $16.3 million partially offset by cash provided by changes in our operating assets and liabilities of $0.6 million and non-cash charges of $1.5 million. The net changes in our operating assets and liabilities were primarily due to an increase in prepaids and other assets of $1.3 million, and a decrease in operating lease liabilities of $2.0 million. The non-cash charges included $1.3 million of stock-based compensation, $0.2 million of depreciation expense, and an immaterial amount of amortization and interest accretion on the Harrison Lease.

Current wording

For the six months ended June 30, 2023, net cash used in operating activities was $33.1 million resulting from our net loss of $35.8 million, and changes in our operating assets and liabilities of $0.8 million partially offset by non-cash charges of $3.5 million. The net changes in our operating assets and liabilities were primarily due to an increase in prepaids and other assets of $0.6 million, and a decrease in operating lease liabilities of $1.3 million. The non-cash charges included $3.2 million of stock-based compensation, $0.5 million of depreciation expense, and an immaterial amount of amortization and interest accretion on our operating lease.

Previous wording

For the three months ended March 31, 2024, net cash used in investing activities was $11.3 million resulting from $29.2 million in purchases of marketable securities partially offset by $18.0 million in maturities and sales of marketable securities.

Current wording

For the six months ended June 30, 2024, net cash used in investing activities was $64.0 million resulting from $94.0 million in purchases of marketable securities partially offset by $30.0 million in maturities and sales of marketable securities.

Previous wording

For the three months ended March 31, 2023, net cash used in investing activities was $1.2 million related to the purchase of property and equipment, primarily associated with building lab space at our new Boston headquarters.

Current wording

For the six months ended June 30, 2023, net cash used in investing activities was $2.2 million related to the purchase of property and equipment, primarily associated with building lab space at our new Boston headquarters.

Previous wording

For the three months ended March 31, 2024, net cash provided by financing activities was $87.0 million resulting from $76.9 million in proceeds from the Follow-on Offering, $9.9 million in proceeds from sales under the Sales Agreement, and $0.4 million from proceeds from the purchase of shares under employee equity plans, partially offset by $0.2 million in the payment of deferred offering costs.

Current wording

For the six months ended June 30, 2024, net cash provided by financing activities was $88.3 million resulting from $76.9 million in proceeds from the Follow-on Offering, $9.9 million in proceeds from sales under the Sales Agreement, and $1.9 million from proceeds from the purchase of shares under employee equity plans, partially offset by $0.4 million in the payment of deferred offering costs.