CRISPR Therapeutics AG

(unaudited)

1. Basis of Presentation and Significant Accounting Policies

Basis of Presentation

The accompanying condensed consolidated financial statements are unaudited and have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America, or U.S. GAAP.

The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The Company views its operations and manages its business inone operating segment, which is the business of discovering, developing and commercializing therapies derived from or incorporating genome-editing technology. Certain information and footnote disclosures normally included in the Company’s annual financial statements have been condensed or omitted. These interim financial statements, in the opinion of management, reflect all normal recurring adjustments necessary for a fair presentation of the financial position and results of operations for the three and nine-month interim periods ended September 30, 2025 and 2024.

The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year. These interim financial statements should be read in conjunction with the audited financial statements for the year ended December 31, 2024, which are contained in the 2024 Annual Report on Form 10-K filed with the Securities and Exchange Commission, or the SEC, on February 11, 2025.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. On an ongoing basis, the Company’s management evaluates its estimates, which include, but are not limited to, revenue recognition, equity-based compensation expense and reported amounts of expenses during the period. The Company bases its estimates on historical experience and other market-specific or other relevant assumptions that it believes to be reasonable under the circumstances. Actual results may differ from those estimates or assumptions. Changes in estimates are reflected in reported results in the period in which they become known.

Significant Accounting Policies

The significant accounting policies used in preparation of these condensed consolidated financial statements for the three and nine months ended September 30, 2025 are consistent with those discussed in Note 2 to the consolidated financial statements in the Company’s 2024 Annual Report on Form 10-K filed with the SEC on February 11, 2025 and discussed in Note 1 in the condensed consolidated financial statements in the Company’s Quarterly Report on Form 10-Q filed with the SEC on August 4, 2025 with respect to acquired in-process research and development expenses and changes to the Company’s policy around collaboration arrangements.

Acquired In-process Research and Development Expenses

In-process research and development that is associated to a product that has not yet achieved regulatory approval and is acquired in a transaction that does not qualify as a business combination under U.S. GAAP is recorded as “Acquired in-process research and development” in the Company’s condensed consolidated statements of operations and comprehensive loss in accordance with Accounting Standards Codification, or ASC, 730, Research and development expense, or ASC 730, as the asset acquired does not have an alternative future use. The Company classifies asset acquisitions of acquired in-process research and development as investing activities on its condensed consolidated statements of cash flows.

Collaboration Arrangements

The Company records the elements of its collaboration agreements that represent joint operating activities in accordance with ASC 808, Collaborative Agreements, or ASC 808. Accordingly, the elements of the collaboration agreements that represent activities in which both parties are active participants and to which both parties are exposed to the significant risks and rewards that are dependent on the commercial success of the activities, are recorded as collaborative arrangements.

The Company evaluates the proper presentation of the commercial activities and the profit and loss sharing associated with the collaboration agreements. ASC 808 states that when payments between parties in a collaborative arrangement are not within the scope of other authoritative accounting literature, the income statement classification should be based on the nature of the arrangement, the nature of its business operations and the contractual terms of the arrangement. To the extent that these payments are not within the scope of other authoritative accounting literature, the income statement classification for the payments shall be based on an analogy to authoritative accounting literature or if there is no appropriate analogy, a reasonable, rational and consistently applied accounting policy election.

Collaboration costs specific to the Vertex Hemoglobinopathy Agreements (as defined in Note 6) accounted for under ASC 808 are presented within “collaboration expense, net” in the condensed consolidated statements of operations and comprehensive loss. Refer to Note 6 of the notes to our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for further discussion on the Vertex Hemoglobinopathy Agreements.

Recent Accounting Pronouncements

In December 2023, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, 2023-09, Improvements to Income Tax Disclosures, which requires entities, on an annual basis, to disclose disaggregated information about their effective tax rate reconciliation and income taxes paid. The disclosure requirements will be applied on a prospective basis, with the option to apply them retrospectively. The standard is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company has adopted ASU 2023-09 and is currently evaluating the guidance, which is expected to only impact annual disclosures with no impact to the Company’s results of operations.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures, and in January 2025, the FASB issued ASU 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures: Clarifying the Effective Date. ASU 2024-03 requires disclosure of additional information about specific expense categories in the notes to the financial statements on an interim and annual basis. ASU 2024-03, as clarified by ASU 2025-01, is effective for fiscal years beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the disclosure requirements related to this new standard.

2. Marketable Securities

The following table summarizes cash equivalents and marketable securities held at September 30, 2025 and December 31, 2024 (in thousands), which are recorded at fair value. The table below excludes $201.9 million and $193.9 million of cash at September 30, 2025 and December 31, 2024, respectively.

The following table summarizes the net unrealized gain (loss) recorded on marketable debt and equity securities during thethree and nine months ended September 30, 2025 and 2024 (in millions):

Unrealized gains and losses on the Company’s marketable debt securities are included in comprehensive loss in the condensed consolidated statements of operations and comprehensive loss. Unrealized gains and losses due to the change in fair value of the Company’s marketable equity securities are included in other income (expense), net, in the condensed consolidated statements of operations and comprehensive loss.

The following table summarizes the net unrealized gain (loss) position of the Company’s marketable debt and equity securities as of September 30, 2025 and December 31, 2024 (in millions):

The following table summarizes the aggregate fair value of marketable debt securities that were in an unrealized loss position as of September 30, 2025 and December 31, 2024 by the length of time the security has been in a loss position (in millions):

As of September 30, 2025, there were $28.4 million in marketable debt securities in an unrealized loss position for more than twelve months with maturities beyond one year. As of December 31, 2024, no marketable debt securities in an unrealized loss position for more than twelve months had maturities beyond one year.

The Company determined that there is no material credit risk associated with the above investments as of September 30, 2025. The Company has the intent and ability to hold such securities until recovery. As a result, the Company did not record any charges for credit-related impairments for its marketable securities for the three and nine months ended September 30, 2025 and 2024. No available-for-sale debt securities held as of September 30, 2025 had remaining maturities greater than thirty months.

Equity Investments Without Readily Determinable Fair Value

The Company holds investments in privately-held companies in the form of equity securities without readily determinable fair values and in which the Company does not have a controlling interest or significant influence. These investments had a net carrying value of $22.6 million and $12.9 million as of September 30, 2025 and December 31, 2024, respectively, and are classified within other non-current assets on the condensed consolidated balance sheets. There were no upward or downward adjustments for observable price changes or impairment charges recorded for the three and nine months ended September 30, 2025 and 2024 related to these equity securities.

3. Fair Value Measurements

The following tables present information about the Company’s financial assets measured at fair value on a recurring basis and indicate the fair value hierarchy classification of such fair values as of September 30, 2025 and December 31, 2024 (in thousands):

Marketable securities classified as Level 1 within the valuation hierarchy consist of corporate equity securities with quoted prices in active markets. Marketable securities classified as Level 2 within the valuation hierarchy generally consist of U.S. treasury securities and government agency securities, certificates of deposit, corporate bonds, commercial paper and warrants to purchase common shares of publicly traded companies. The Company estimates the fair value of these marketable securities by taking into consideration valuations obtained from third-party pricing sources.

4. Property and Equipment, net

Property and equipment, net, consists of the following (in thousands):

Depreciation expense for the three and nine months ended September 30, 2025 was $4.4 million and $13.8 million, respectively. Depreciation expense for the three and nine months ended September 30, 2024 was $4.8 million and $14.4 million, respectively.

5. Accrued Expenses

Accrued expenses consist of the following (in thousands):

6. Significant Contracts

Agreements with Vertex

For purposes of this Note 6 and Note 7, CASGEVY (exagamglogene autotemcel [exa-cel]) is referred to as “CASGEVY”.

2015 collaboration

In 2015, the Company entered into a strategic collaboration, option and license agreement, or the 2015 Collaboration Agreement, with Vertex Pharmaceuticals Incorporated, or Vertex. The 2015 Collaboration Agreement is focused on the use of the Company’s CRISPR/Cas9 gene editing technology to discover and develop potential new treatments aimed at the underlying genetic causes of human disease. The Company and Vertex amended the 2015 Collaboration Agreement in 2017 and 2019 with Amendment No. 1 and Amendment No. 2, respectively, namely to clarify Vertex’s option rights under the 2015 Collaboration Agreement and to modify certain definitions and provisions of the 2015 Collaboration Agreement to make them consistent with the JDA (as defined below) and a strategic collaboration and license agreement from 2019 for the development and commercialization of products for the treatment of Duchenne muscular dystrophy and myotonic dystrophy Type 1. In 2017, Vertex exercised an option granted to it under the 2015 Collaboration Agreement to obtain a co-exclusive license to develop and commercialize hemoglobinopathy and beta-globin targets, and in 2019, Vertex exercised the remaining options granted to it under the 2015 Collaboration Agreement to exclusively license certain collaboration targets developed under the 2015 Collaboration Agreement.

Hemoglobinopathies collaboration

In 2017, following Vertex’s exercise of its option to obtain a co-exclusive license to develop and commercialize hemoglobinopathy and beta-globin targets, the Company and Vertex entered into a joint development and commercialization agreement, or the JDA, and agreed for potential hemoglobinopathy treatments, including CASGEVY, the Company and Vertex would share equally all research and development costs and worldwide revenues. In 2021, the Company and Vertex amended and restated the JDA, or the A&R Vertex JDCA (as amended and in effect, from time to time), pursuant to which the parties agreed to, among other things, (a) adjust the governance structure for the collaboration and adjust the responsibilities of each party thereunder, whereby Vertex leads and has all decision making (i.e., control) in relation to the CASGEVY program prospectively; (b) adjust the allocation of net profits and net losses between the parties with respect to CASGEVY only, which will be allocated 40% to the Company and 60% to Vertex, prospectively; and (c) exclusively license (subject to the Company’s reserved rights to conduct certain activities) certain intellectual property rights to Vertex relating to the specified product candidates and products (including CASGEVY) that may be researched, developed, manufactured and commercialized on a worldwide basis under the A&R Vertex JDCA. Additionally, for 2022, 2023, and 2024, the Company had an option to defer a portion of its share of costs under the A&R Vertex JDCA if spending on the CASGEVY program exceeded specified amounts. Any deferred amounts under the A&R Vertex JDCA, as amended, are only payable to Vertex as an offset against future profitability of the CASGEVY program and the amounts payable are capped at a specified maximum amount per year.

In December 2023, the Company entered into an amendment to the A&R Vertex JDCA, or Amendment No. 1 to the A&R Vertex JDCA, with Vertex related to the global development, manufacturing, and commercialization of CASGEVY. Pursuant to Amendment No. 1 to the A&R Vertex JDCA, among other things, the Company and Vertex agreed to (a) allocate certain costs arising from a license agreement with a third party, resulting in a current payment due to Vertex by the Company of $20.0 million upon an event specified in Amendment No. 1 to the A&R Vertex JDCA, and (b) adjust, under certain specified circumstances, the timing of and portion of the Company’s share of costs it is permitted to defer under the agreement.

Letter Agreement

In May 2024, Vertex and the Company entered into a letter agreement, or the Letter Agreement, with respect to the priority review voucher issued by the U.S. Food and Drug Administration to Vertex as the sponsor of the rare pediatric disease product application for CASGEVY. Vertex and the Company agreed that if Vertex utilizes or transfers the priority review voucher prior to the first calendar year in which the CASGEVY program generates a net profit, Vertex will pay the Company $43.0 million or an amount equal to 42% of the net proceeds from such transfer, as applicable. If the CASGEVY program begins generating calendar-year net profits prior to such utilization or transfer, Vertex will instead pay the Company up to $43.0 million set-off by deductions Vertex would otherwise be eligible to take against the CASGEVY program’s net profits due to the Company related to amounts deferred previously by the Company.

Collaboration in the field of diabetes

In 2021, the Company and ViaCyte, Inc., or ViaCyte, entered into a joint development and commercialization agreement, or the ViaCyte JDCA, to jointly develop and commercialize product candidates and shared products for the diagnosis, treatment or prevention of diabetes type 1, diabetes type 2 or insulin dependent / requiring diabetes throughout the world. In the third quarter of 2022, Vertex acquired ViaCyte, and ViaCyte became a wholly-owned subsidiary of Vertex. In March 2023, (1) the Company and ViaCyte entered into an amendment to the ViaCyte JDCA, or the ViaCyte JDCA Amendment, and adjusted certain rights and obligations of the Company and ViaCyte under the ViaCyte JDCA, and (2) the Company and Vertex entered into a non-exclusive license agreement, or the Non-Ex License Agreement, pursuant to which the Company agreed to license to Vertex, on a non-exclusive basis, certain of its gene editing intellectual property to exploit certain products for the diagnosis, treatment or prevention of diabetes type 1, diabetes type 2 or insulin dependent / requiring diabetes throughout the world. Subsequently, ViaCyte elected to opt-out of the ViaCyte JDCA. Per the opt-out terms, the on-going collaboration assets are now wholly owned by the Company, subject to a royalty on future sales owed to ViaCyte. The opt-out became effective in early February 2024.

In 2024, the Company received a $10.0 million research milestone achieved in the fourth quarter of 2024 and recorded a receivable of $25.0 million as of December 31, 2024 related to an additional research milestone achieved under the Non-Ex License Agreement in the fourth quarter of 2024. The Company is eligible to receive additional milestone payments under the Non-Ex License Agreement of up to $125.0 million in aggregate, which are dependent on the achievement of pre-determined research, development and commercial milestones for certain products utilizing the licensed intellectual property. Additionally, the Company is eligible to receive tiered royalties on the sales of certain products in the low to mid-single digits.

Accounting Analysis

For purposes of this Note 6, the 2015 Collaboration Agreement, Amendment No. 1, Amendment No. 2, A&R Vertex JDCA, and Amendment No. 1 to the A&R Vertex JDCA are collectively referred to as the “Vertex Hemoglobinopathy Agreements” and the Non-Ex License Agreement and ViaCyte JDCA Amendment are collectively referred to as the “March 2023 Diabetes Agreements.”

The Vertex Hemoglobinopathy Agreements and the March 2023 Diabetes Agreements include components of a customer-vendor relationship as defined under ASC 606, Revenue from Contracts with Customers, or ASC 606, collaborative arrangements as defined under ASC 808 and research and development costs as defined under ASC 730, Research and Development, or ASC 730. Specifically, with regards to the March 2023 Diabetes Agreements, the Company concluded that the non-exclusive license is a performance obligation under ASC 606 and the ongoing research and development services under the ViaCyte JDCA Amendment are a unit of account under ASC 808.

The Company has determined that recognition criteria for the Letter Agreement has not been met and will not be met until the priority review voucher is (i) utilized or (ii) there is sufficient profitability such that Vertex is obligated to pay the Company under the Letter Agreement.

Accounting Analysis Under ASC 606

Accounting for the March 2023 Diabetes Agreements

Recognition of Revenue

No revenue was recognized under the March 2023 Diabetes Agreements for thethree and nine months ended September 30, 2025 and 2024.

Milestones under the Non-Ex License Agreement

As of September 30, 2025, the Company is eligible to receive potential future milestone payments from Vertex of up to $125.0 million in the aggregate under the Non-Ex License Agreement depending on the achievement of pre-determined research, development and commercial milestones for certain products utilizing the licensed intellectual property. Additionally, the Company is eligible to receive tiered royalties on the sales of certain products in the low to mid-single digits.

Each of the remaining milestones under the Non-Ex License Agreement are fully constrained as of September 30, 2025. There is uncertainty as to whether the events to obtain the research and developmental milestones will be achieved given the nature of clinical development and the stage of the CRISPR/Cas9 technology. The remaining research, development and regulatory milestones will be constrained until it is probable that a significant revenue reversal will not occur. Commercial milestones and royalties relate predominantly to a license of intellectual property and are determined by sales or usage-based thresholds. The commercial milestones and royalties are accounted for under the royalty recognition constraint and will be accounted for as constrained variable consideration. The Company applies the royalty recognition constraint for each commercial milestone and will not recognize revenue for each until the subsequent sale of a licensed product (achievement of each) occurs.

Accounting for the Vertex Hemoglobinopathy Agreements

Recognition of Revenue

No revenue was recognized under the Vertex Hemoglobinopathy Agreements for thethree and nine months ended September 30, 2025 and 2024.

Milestones under the Vertex Hemoglobinopathy Agreements

The Company has evaluated the milestones that may be received in connection with the Vertex Hemoglobinopathy Agreements.

Under the 2015 Collaboration Agreement and subsequent amendments, the Company is eligible to receive up to $410.0 million in additional development, regulatory and commercial milestones and royalties on net product sales for each of the three collaboration targets that Vertex licensed in 2019. Each milestone is payable only once per collaboration target, regardless of the number of products directed to such collaboration target that achieve the relevant milestone event.

The Company has the option to conduct research at its own cost in certain defined areas. If such research is beneficial to a program under the Vertex Hemoglobinopathy Agreements and the applicable product ultimately achieves regulatory approval in such areas, the Company could be entitled to receive from Vertex certain milestone payments aggregating to high eight digits.

Each of the remaining milestones described above are fully constrained as of September 30, 2025. There is uncertainty that the events to obtain the research and developmental milestones will be achieved given the nature of clinical development and the stage of the CRISPR/Cas9 technology. The remaining research, development and regulatory milestones will be constrained until it is probable that a significant revenue reversal will not occur. Commercial milestones and royalties relate predominantly to a license of intellectual property and are determined by sales or usage-based thresholds. The commercial milestones and royalties are accounted for under the royalty recognition constraint and will be accounted for as constrained variable consideration. The Company applies the royalty recognition constraint for each commercial milestone and will not recognize revenue for each until the subsequent sale of a licensed product (achievement of each) occurs.

Accounting Analysis under ASC 808

Vertex Hemoglobinopathy Agreements

In connection with the Vertex Hemoglobinopathy Agreements, the Company identified the following collaborative elements, which are accounted for under ASC 808: (i) development and commercialization services for shared products, including any transition services related to CASGEVY under the A&R Vertex JDCA; (ii) R&D Services for follow-on products; and (iii) committee participation. The related impact of the cost sharing under the Vertex Hemoglobinopathy Agreements is included within collaboration expense, net, in the condensed consolidated statements of operations and comprehensive loss.

During the three and nine months ended September 30, 2025, the Company recognized $57.1 million and $159.8 million of collaboration expense, net, respectively. Collaboration expense, net, during thethree and nine months ended September 30, 2025 was net of $0.4 million and $1.1 million of reimbursements from Vertex, respectively.

In the third quarter of 2024, the Company exercised its option to defer specified costs on the CASGEVY program in excess of $110.3 million under the A&R Vertex JDCA, as amended. During the three and nine months ended September 30, 2024, the Company recognized $11.2 million and $110.3 million of collaboration expense, net, respectively. Collaboration expense, net, during thethree and nine months ended September 30, 2024 was net of $0.5 million and $1.8 million of reimbursements from Vertex, respectively.

Additional Accounting Considerations

The Company is eligible to receive potential future payments of up to $775.0 million upon the successful achievement of specified development, regulatory and commercial milestones under a strategic collaboration and license agreement with Vertex from 2019 for the development and commercialization of products for the treatment of Duchenne muscular dystrophy, or DMD, and myotonic dystrophy Type 1, or DM1. The Company is also eligible to receive tiered royalties on future net sales on any products that may result from this collaboration; however, the Company has the option to forego the DM1 milestones and royalties to co-develop and co-commercialize all DM1 products globally.

Each of the remaining milestones are fully constrained as of September 30, 2025. There is uncertainty that the events to obtain the research and developmental milestones will be achieved given the nature of clinical development and the stage of the CRISPR/Cas9 technology. The remaining research, development and regulatory milestones will be constrained until it is probable that a significant revenue reversal will not occur. Commercial milestones and royalties relate predominantly to a license of intellectual property and are determined by sales or usage-based thresholds. The commercial milestones and royalties are accounted for under the royalty recognition constraint and will be accounted for as constrained variable consideration. The Company applies the royalty recognition constraint for each commercial milestone and will not recognize revenue for each until the subsequent sale of a licensed product (achievement of each) occurs.

As of September 30, 2025, there was $12.3 million of non-current deferred revenue related to the strategic collaboration and license agreement with Vertex from 2019 for the development and commercialization of products for the treatment of DMD and DM1, which is unchanged from December 31, 2024. The transaction price allocated to the remaining performance obligations was $12.3 million.

Agreement with Sirius Therapeutics

On May 19, 2025, the Company entered into a collaboration, option and license agreement, or the Sirius Agreement, with Sirius Therapeutics and certain of its affiliates, or Sirius, pursuant to which, among other things, (1) Sirius and the Company will collaborate on the research, development, manufacture, commercialization and use of certain collaboration products utilizing Sirius’ siRNA technology for targeting Factor XI, including SRSD107, collectively, the Sirius Collaboration Products; and (2) Sirius granted to the Company options to exclusively license Sirius siRNA technology to target up to two licensed targets from a list of seven reserved targets for the research, development, manufacture and commercialization of licensed products, collectively the Sirius Licensed Products, in exchange for the potential to receive certain option fees, milestone payments and royalties.

In connection with entering into the Sirius Agreement, the Company made an upfront cash payment to Sirius of $25.0 million andalso entered into a share issuance agreement with Sirius, pursuant to which the Company registered and issued to Sirius 1,842,105 common shares equal to approximately $70.0 million based on a price per common share equal to $38.00, nominal value CHF 0.03 per share, or the Sirius Shares.

With respect to Sirius Collaboration Products, the Company and Sirius will share equally all development and commercialization costs. For the first collaboration product candidate successfully developed, the Company will be the lead party responsible for commercialization efforts in the United States and Sirius will be the lead party responsible for commercialization efforts in Greater China. The parties will determine the lead party responsible for commercialization in the rest of the world at a future date. The Company and Sirius will share equally net profits and net losses incurred under the Sirius Agreement with respect to all Sirius Collaboration Products, except in the event that a party opts out of the joint development and commercialization. The Company will pay Sirius certain specified future development and regulatory milestones of up to an aggregate of $87.5 million for the first Sirius Collaboration Productsto achieve the applicable milestone events. At the Company’s sole election, such milestone payments may be paid in cash, common shares of the Company, or a combination thereof.

With respect to the Sirius Licensed Products, if the Company elects to exercise its option to a licensed target to research, develop, manufacture and commercialize Sirius Licensed Products, the Company will make a one-time $10.0 million payment per option exercise, each, a Sirius Option Payment, to Sirius. The Sirius Option Payment is payable up to two times. In addition, the Company will pay Sirius certain specified future development, regulatory and sales milestones of up to an aggregate of $300.0 million for the first Sirius Licensed Product relating to each licensed targetto achieve the applicable milestone events, as well as tiered royalty payments in the mid-single digits to low double digits range on future sales of a commercialized Sirius Licensed Product. The royalty payments are subject to reduction under certain specified conditions set forth in the Sirius Agreement. In addition, at the Company’s sole election, such milestones may be paid in cash, common shares of the Company, or a combination thereof. The Company is solely responsible for all research, development, manufacturing and global commercialization activities and associated costs for the Sirius Licensed Products, as well as all associated costs related to Sirius activities set forth in any applicable research plan relating thereto.

Accounting for the Sirius Agreement

The Company determined that substantially all the fair value of the upfront payment under the Sirius Agreement was attributable to acquired in-process research and development for which there was no alternative future use and that no substantive processes were acquired that would constitute a business. As a result, the Company recorded $96.3 million to acquired in-process research and development in the condensed consolidated statement of operations and comprehensive loss. The $96.3 million represented the $25.0 million upfront cash payment to Sirius, as well as $71.3 million in expense related to the issuance of the Sirius Shares at a fair value of $38.68 per share, which was the fair value of the Company’s common shares on the effective date of the Sirius Agreement.

The Sirius Agreement includes components of collaborative arrangements as defined under ASC 808 and research and development costs as defined under ASC 730.

Specifically, development and commercialization costs for the Sirius Collaboration Products contain collaborative elements accounted for under ASC 808, and the related impact of cost sharing for the Sirius Collaboration Products under the Sirius Agreement is included within research and development expenses in the condensed consolidated statement of operations and comprehensive loss. Costs related to Sirius Licensed Products under the Sirius Agreement are included within research and development expenses in the consolidated statement of operations and comprehensive loss.

Research and development costs under the Sirius Agreement were not material for the three and nine months ended September 30, 2025.

7. Commitments and Contingencies

Leases

Refer to Note 7 to the consolidated financial statements in the Company’s 2024 Annual Report on Form 10-K filed with the SEC on February 11, 2025 for discussion of the Company’s lease arrangements.

Litigation

In the ordinary course of business, the Company is or has been from time to time involved in lawsuits, investigations, proceedings and threats of litigation related to, among other things, the Company’s intellectual property estate (including certain in-licensed intellectual property), commercial arrangements and other matters. Such proceedings may include quasi-litigation, inter partes administrative proceedings in the U.S. Patent and Trademark Office and the European Patent Office or patent offices in other countries, involving the Company’s intellectual property estate including certain in-licensed intellectual property. The outcome of any of the foregoing, regardless of the merits, is inherently uncertain. In addition, litigation and related matters are costly and may divert the attention of Company’s management and other resources that would otherwise be engaged in other activities. If the Company is unable to prevail in any such proceedings, the Company’s business, results of operations, liquidity and financial condition could be adversely affected.

Letters of Credit

As of September 30, 2025, the Company had restricted cash of $11.5 million, representing letters of credit securing the Company’s obligations under certain leased facilities. The letters of credit are secured by cash held in a restricted depository account, with $3.5 million included in “Prepaid expenses and other current assets” and $8.0 million included in “Restricted cash” on the Company’s condensed consolidated balance sheet as of September 30, 2025.

Research, Manufacturing, License and Intellectual Property Agreements

The Company has engaged several research institutions and companies to identify new delivery strategies and applications of the Company’s gene editing technology. The Company is also a party to a number of license agreements which require significant upfront payments and may be required to make future royalty payments and potential milestone payments from time to time. In addition, the Company is also a party to intellectual property agreements, which require maintenance and milestone payments from time to time. Further, the Company is a party to a number of manufacturing agreements that require upfront payments for the future performance of services.

In connection with these agreements, on a product-by-product basis, the counterparties are eligible to receive up to low eight-digit potential payments upon specified research, development and regulatory milestones. In addition, on a product-by-product basis, the counterparties are eligible to receive potential commercial milestone payments based on specified annual sales thresholds. The potential payments are low-single digit percentages of the specified annual sales thresholds. The counterparties are also eligible to receive low single-digit royalties on future net sales.

Contractual amounts due under license and intellectual property agreements are accrued and, if a contingency exists related to the interpretation of the amounts due under the license agreement, the Company recognizes a liability for the amount that is probable and estimable. When no amount within the range of potential payments is a better estimate than any other amount, the minimum amount in the range is accrued. In the second quarter of 2025, a third-party licensor formally engaged with the Company regarding certain matters under their intellectual property contracts with the Company that may lead to further actions that could result in additional amounts being owed by the Company to such third party. As of September 30, 2025, the Company is unable to provide an estimate of a reasonably possible loss or range of loss. The ultimate resolution of this matter could result in an outcome that is materially different from the amounts accrued as of September 30, 2025.

Under certain circumstances and if certain contingent future events occur, Vertex is eligible to receive up to $395.0 million in potential specified research, development, regulatory and commercial milestones and tiered single-digit percentage royalties on future net sales related to a specified target under an amendment to the 2015 Collaboration Agreement (as such term is defined in Note 6 of the notes to our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q above). In addition, Vertex has the option to conduct research at its own cost in certain defined areas that, if beneficial to a program under the Vertex Hemoglobinopathy Agreements and the applicable product ultimately achieves regulatory approval, could result in the Company owing Vertex certain milestone payments aggregating to high eight digits, subject to certain limitations on the profitability of the program.

Under the A&R Vertex JDCA, as amended, for 2022, 2023 and 2024, the Company had an option to defer a portion of its share of costs if spending on the CASGEVY program exceeded specified amounts, which the Company exercised in each such year, resulting in deferred costs of $221.8 million, in the aggregate. Any deferred amounts under the A&R Vertex JDCA, as amended, are only payable to Vertex as an offset against future profitability of the CASGEVY program and the amounts payable are capped at a specified maximum amount per year. These deferred costs on the CASGEVY program will be recognized by the Company when recoverability of such deferred amounts by Vertex is probable and the amount can be reasonably estimated. As of September 30, 2025, no contingent payments have been accrued to date.

The Company may be required to make future potential payments to Sirius under the Sirius Agreement defined and described in Note 6 of the notes to our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q. Potential payments to Sirius include (i) up to $20.0 million in Sirius Option Payments, (ii) up to $300.0 million in certain specified future development, regulatory and sales milestones for the first Sirius Licensed Product relating to each licensed targetto achieve the applicable milestones, as well as tiered royalty payments in the mid-single digits to low double digits range on future sales of a commercialized Sirius Licensed Product, and (iii) up to $87.5 million in certain specified future development and regulatory milestones related to the Sirius Collaboration Products.

8. Share Capital

All of the Company’s common shares are authorized under Swiss corporate law with a nominal value of 0.03 CHF per share. Though the nominal value of common shares is stated in Swiss francs, the Company continues to use U.S. dollars as its reporting currency for preparing the condensed consolidated financial statements.

As of September 30, 2025, the Company’s share capital consists of 95,047,997 registered common shares with a nominal value of CHF 0.03 per share,8,202,832 registered common shares reserved for potential issuance of bonds or similar instruments and 19,537,850 registered common shares reserved for the Company’s employee equity incentive plans. In addition, the Board of Directors is authorized to conduct one or more increases of the share capital at any time until June 8, 2028, or the expiration of the capital band if earlier, up to an upper limit of CHF 3,142,094.52 by issuing a corresponding number of registered shares with a nominal value of CHF 0.03 each to be fully paid in. As of September 30, 2025, the number of shares that may be issued under the capital band is 9,688,487 registered common shares.

Common Share Issuances

At-the-Market Offerings

The Company has entered into an Open Market Sale Agreement SM, or the Sales Agreement, with Jefferies LLC under which the Company, at its sole discretion, is able to offer and sell, from time to time at prevailing market prices, its common shares. The following are in connection with the Sales Agreement.

2021 ATM

In January 2021, the Company filed a prospectus supplement with the SEC to offer and sell, from time to time, common shares having aggregate gross proceeds of up to $600.0 million, or, together with the subsequent prospectus supplements filed in July 2021 and August 2024 relating to the common shares remaining under the original prospectus supplement, the 2021 ATM. For the nine months ended September 30, 2025, the Company issued and sold an aggregate of 5.1 million common shares under the 2021 ATM at an average price of $57.39 per share for aggregate proceeds of $286.8 million, which were net of equity issuance costs of $3.7 million, excluding stamp taxes of $2.9 million. Activity under the 2021 ATM was not material for thenine months ended September 30, 2024. As of September 30, 2025, the Company has issued and sold an aggregate of 7.0 million common shares under the 2021 ATM at an average price of $75.40 per share for aggregate proceeds of $520.0 million, which were net of equity issuance costs of $6.8 million, excluding stamp taxes of $5.2 million. As of September 30, 2025, common shares having aggregate gross proceeds up to $73.2 million remain available under the 2021 ATM.

From September 30, 2025 through the date of issuance of this Quarterly Report on Form 10-Q, the Company has issued and sold an aggregate of 1.0 million common shares under the 2021 ATM at an average price of $70.53 per share for aggregate proceeds of $72.2 million, which were net of equity issuance costs of $1.0 million, excluding stamp taxes of $0.7 million.

2025 ATM

In October 2025, the Company filed a new prospectus supplement with the SEC to offer and sell, from time to time, common shares having aggregate gross proceeds of up to $600.0 million, or the 2025 ATM. Through the date of issuance of this Quarterly Report on Form 10-Q, the Company has issued and sold an aggregate of 0.2 million common shares under the 2025 ATM at an average price of $73.53 per share for aggregate proceeds of $11.7 million, which were net of equity issuance costs of $0.1 million, excluding stamp taxes of $0.1 million. Common shares having aggregate gross proceeds up to $588.3 million remain available under the 2025 ATM.

Share Issuance Agreement with Sirius Therapeutics

As described in Note 6 of the notes to our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q, the Company and Sirius entered into a share issuance agreement and the Company registered and issued 1,842,105 of the Company’s common shares to Sirius, nominal value CHF 0.03 per share, at an issue price of $38.00 per share as partial consideration for entering into the Sirius Agreement.

Additional Financings

In February 2024, the Company entered into an investment agreement for the sale of approximately $280.0 million of its common shares to a group of institutional investors in a registered direct offering, at a price per share of $71.50. The Company received net proceeds of $279.0 million, excluding stamp taxes due of $2.8 million.

9. Stock-based Compensation

During thethree and nine months ended September 30, 2025 and 2024, the Company recognized the following stock-based compensation expense (in thousands):

Stock option activity

The following table summarizes stock option activity for thenine months ended September 30, 2025:

As of September 30, 2025, total unrecognized compensation expense related to stock options was $60.1 million, which the Company expects to recognize over a remaining weighted-average period of 2.4 years.

Restricted stock activity

The following table summarizes restricted stock activity for thenine months ended September 30, 2025:

As of September 30, 2025, total unrecognized compensation expense related to unvested restricted common shares was $78.4 million, which the Company expects to recognize over a remaining weighted-average vesting period of 2.7 years.

10. Net Loss Per Share Attributable to Common Shareholders

Basic net loss per share is calculated by dividing net loss attributable to common shareholders by the weighted-average number of common shares outstanding during the period. Diluted net loss per share is calculated by adjusting weighted-average shares outstanding for the dilutive effect of common stock equivalents outstanding for the period using the treasury stock method. For purposes of the diluted net loss per share calculation, stock options, unvested restricted common shares and ESPP shares are considered to be common stock equivalents but are excluded from the calculation of diluted net loss per share, as their effect would be anti-dilutive; therefore, basic and diluted net loss per share were the same for all periods presented as a result of the Company’s net loss. The Company’s net loss is net loss attributable to common shareholders for all periods presented.

The Company did not include the securities in the following table in the computation of the net loss per share calculations for thethree and nine months ended September 30, 2025 and 2024 because the effect would have been anti-dilutive during each period:

11. Income Taxes

During the three and nine months ended September 30, 2025, the Company recorded an income tax provision of $0.6 million and $3.0 million, respectively, representing an effective tax rate of (0.6%) and (0.7%), respectively. During thethree and nine months ended September 30, 2024, the Company recorded an income tax provision of $0.9 million and $2.9 million, respectively, representing an effective tax rate of (1.0%) and (0.9%), respectively. The income tax provision for thethree and nine months ended September 30, 2025 is primarily attributable to the income generated by the Company’s U.S. subsidiaries. The difference in the statutory tax rate and effective tax rate is primarily a result of the jurisdictional mix of earnings, research credits generated, and the valuation allowance recorded against certain deferred tax assets. The Company maintains a valuation allowance against certain deferred tax assets that are not more-likely-than-not realizable.

On July 4, 2025, the “One Big Beautiful Bill Act” was enacted, introducing significant changes to the U.S. federal income tax code. Key provisions include modifications to the treatment of research and development, or R&D, expenditures, adjustments to interest deductibility, and changes to international tax rules that may affect the Company’s global structure. As a biotechnology company with substantial investments in early-stage R&D and clinical development, the Company is currently assessing the implications of the legislation, particularly the restoration of immediate expensing for qualified R&D. The provisions of the bill are expected to reduce the Company’s taxable income in 2025, resulting in a decrease in current tax expense. Conversely, the remeasurement of deferred tax assets and liabilities under ASC 740, Income Taxes, to reflect the new law has resulted in an increase in deferred tax expense recorded as a discrete item within income tax expense during the three months ended September 30, 2025. The Company will continue to monitor developments and assess the impact of the legislation on its deferred tax assets, effective tax rate and long-term tax planning strategies.

12. Segment Information

The Company operates asone operating segment, which is the business of discovering, developing and commercializing therapies derived from or incorporating genome-editing technology. The determination of a single business segment is consistent with the consolidated financial information regularly provided to the Company’s chief operating decision maker, or CODM. The Company’schief executive officer, as the CODM, uses consolidated, single-segment financial information for purposes of evaluating performance, making operating decisions, allocating resources and planning and forecasting for future periods.

The CODM assesses performance and decides how to allocate resources based on consolidated net loss. The measure is used to monitor budget verses actual results to evaluate the performance of the segment.

The measure of segment assets is reported on the condensed consolidated balance sheets as total consolidated assets. All material long-lived assets are located in the United States. Long-lived assets consist of property and equipment, net, and operating lease right-of-use assets.

The following table illustrates information about segment revenue, significant segment expenses and segment operating loss for the periods presented (in thousands):

(1) The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.

(2) Research and development expense for the three and nine months ended September 30, 2025 excludes $7.6 million and $25.1 million of stock-based compensation expense, respectively, and $2.3 million and $7.0 million of depreciation expense, respectively. Research and development expense for the three and nine months ended September 30, 2024 excludes $11.9 million and $36.5 million of stock-based compensation expense, respectively, and $2.5 million and $7.8 million of depreciation expense, respectively.

(3) Acquired in-process research and development expense for the nine months ended September 30, 2025 relates to expense of $25.0 million related to the upfront cash payment to Sirius in the second quarter of 2025, as well as expense of $71.3 million related to the issuance of the Company’s common shares issued to Sirius as part of the Sirius Agreement in the second quarter of 2025, as described further in Note 6 of the notes to our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.

(4) General and administrative expense for the three and nine months ended September 30, 2025 excludes $9.0 million and $29.3 million of stock-based compensation expense, respectively, and $2.2 million and $6.7 million of depreciation expense, respectively. General and administrative expense for thethree and nine months ended September 30, 2024 excludes $9.6 million and $28.1 million of stock-based compensation expense, respectively, and $2.2 million and $6.6 million of depreciation expense, respectively.

(5) Other segment items include interest income, net, the change in fair value of corporate equity securities and income tax expense.

The Company operates in the United States and Switzerland. Collaboration revenue is attributed to the CRISPR Therapeutics AG entity, which is domiciled in Switzerland.