Prime Medicine Inc
For the period ended Jun 30, 2024. Filed Aug 8, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 8, 2024
PRME$4.65+4.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-10.
0001628280-24-022473
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-08.
0001628280-24-035893
Item 2. Managements Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 91 previous paragraphs and 98 current paragraphs.
47 unchanged; 31 reworded; 14 added; 12 removed; 1 previous and 6 current paragraphs rearranged.
Tables are not compared: 4 previous and 7 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (14)
Current report
Results of Operations
Current report
•$1.7 million increase in clinical expenses related to PM359, our candidate to treat chronic granulomatous disease.
Current report
These were offset by a $1.7 million decrease in lab supplies driven by fewer programs being in the preclinical stage in 2024.
Current report
This was offset by a $1.4 million decrease in professional and consultant fees for legal services.
Current report
•$2.2 million increase in clinical expenses related to PM359, our candidate to treat chronic granulomatous disease.
Current report
This was offset by a $2.3 million decrease in professional and consultant fees for legal services.
Current report
Going Concern
Current report
Since our inception, we have incurred substantial losses. As of June 30, 2024, we had an accumulated deficit of $592.4 million and we expect to generate operating losses and negative operating cash flows for the foreseeable future. As stated above, as of June 30, 2024, we maintained cash, cash equivalents, short-term investments, and related party short-term investments of $162.9 million.
Current report
In accordance with ASC 205-40, we evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern within one year after the date on which this Quarterly Report on Form 10-Q is filed. Based on the our cash, cash equivalents, short-term investments, and related party short-term investments as of June 30, 2024, our current and forecasted level of operations and forecasted cash flows, our ability to continue as a going concern is dependent upon our ability to obtain the necessary financing to meet our obligations and repay our liabilities arising from normal business operations when they come due, and to generate profitable operations in the future. Management plans to provide for capital requirements through financing or other transactions, and selling shares under our “at the market offering” program. There can be no assurance that we will be able to raise additional capital to fund operations with terms acceptable to us, or at all. Because certain elements of our plans to mitigate the conditions that raised substantial doubt about our ability to continue as a going concern are outside of our control, including the ability to raise capital through an equity or other financing, those elements cannot be considered probable according to ASC 205-40, and therefore cannot be considered in the evaluation of mitigating factors. As a result, we concluded that substantial doubt exists about our ability to continue as a going concern for 12 months from the date these condensed consolidated financial statements are issued.
Current report
The condensed consolidated financial statements as of June 30, 2024 have been prepared under the assumption that we will continue as a going concern for the next 12 months and that contemplates the realization of assets and satisfaction of liabilities and commitments in the normal course of business. Our ability to continue as a going concern is dependent upon our uncertain ability to obtain additional capital, reduce expenditures and/or execute on its business plan. These condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Current report
•$101.1 million net loss;
Current report
•$81.8 million net loss;
Current report
These were offset by:
Current report
Net cash provided by investing activities for the six months ended June 30, 2023 was driven primarily by the following:
Removed paragraphs (12)
Previous report
Operating Expenses
Previous report
Research and Development Expenses
Previous report
General and Administrative Expenses
Previous report
Other Income (Expense)
Previous report
Operating Expenses
Previous report
Research and Development Expenses
Previous report
General and Administrative Expenses
Previous report
Other Income (Expense)
Previous report
Other Income, Net
Previous report
Other income, net for the three months ended March 31, 2024 primarily consists of interest income from the Company’s short-term investments.
Previous report
•$45.8 million net loss;
Previous report
•$39.4 million net loss;
Reworded paragraphs (31)
Previous wording
Chronic granulomatous disease is our most advanced blood program, and we have designated PM359 as our development candidate. In April 2024, we announced that the U.S. Food and Drug Administration cleared our investigational new drug application for PM359 for the treatment of chronic granulomatous disease, enabling us to initiate our global Phase 1/2 clinical trial in the United States. The Phase 1/2 clinical trial is a multinational, first-in-human trial designed to assess the safety, biological activity and preliminary efficacy of PM359 in adult and pediatric study participants.
Current wording
Chronic granulomatous disease is our most advanced blood program, and we are advancing PM359 as our candidate in the treatment of this disease.
Previous wording
•expenses incurred in connection with continuing our current research programs and preclinical development of any product candidates we may identify, including under agreements with third parties, such as consultants and contractors;
Current wording
•expenses incurred in connection with continuing our current research programs and preclinical and clinical development of any product candidates we may identify, including under agreements with third parties, such as consultants and contractors;
Previous wording
•the cost of developing and validating our manufacturing process for use in our preclinical studies and future clinical trials;
Current wording
•the cost of developing and validating our manufacturing process for use in our preclinical and clinical studies;
Previous wording
Results of Operations — Comparison of the Three Months Ended March 31, 2024 and 2023
Current wording
Comparison of the Three Months Ended June 30, 2024 and 2023
Previous wording
The $6.9 million increase in research and development expense for the three months ended March 31, 2024 as compared to the three months ended March 31, 2023 was primarily driven by:
Current wording
The $8.5 million increase in research and development expense for the three months ended June 30, 2024 as compared to the three months ended June 30, 2023 was primarily driven by:
Previous wording
•$2.0 million increase in facility-related expense primarily due to the expansion and build out of our laboratory space.
Current wording
•$5.3 million increase in facility-related expense primarily due to the expansion and build out of our laboratory space;
Previous wording
•$3.8 million increase in personnel expense, including an increase in stock-based compensation expense of $1.6 million, driven by our increased headcount as we continue to build out our research and development function; and
Current wording
•$3.6 million increase in personnel expense, including an increase in stock-based compensation expense of $2.1 million, driven by our increased headcount as we continue to build out our research and development function; and
Previous wording
The $2.0 million increase in general and administrative expense for the three months ended March 31, 2024 as compared to the three months ended March 31, 2023 is primarily driven by $2.8 million increase in personnel expense, including an increase in stock-based compensation expense of $2.0 million, driven by growth in personnel as we operate as a public company and to support our growing research and development function.
Current wording
The $1.9 million increase in general and administrative expense for the three months ended June 30, 2024 as compared to the three months ended June 30, 2023 is primarily driven by $2.8 million increase in personnel expense, including an increase in stock-based compensation expense of $2.5 million, driven by growth in personnel as we operate as a public company and to support our growing research and development function.
Previous wording
Since our inception, we have incurred significant operating losses. We expect to incur significant expenses and operating losses for the foreseeable future as we commence the clinical development of our programs and continue our platform development and early-stage research activities. We have not yet commercialized any products and we do not expect to generate revenue from sales of products for several years, if at all. To date, we have funded our operations primarily with proceeds from sales of preferred stock and from our public offerings. As of March 31, 2024, we had cash, cash equivalents, and investments of $210.7 million, excluding our restricted cash, or $224.2 million, including restricted cash.
Current wording
Since our inception, we have incurred significant operating losses. We expect to incur significant expenses and operating losses for the foreseeable future as we commence the clinical development of our programs and continue our platform development and early-stage research activities. We have not yet commercialized any products and we do not expect to generate revenue from sales of products for several years, if at all. To date, we have funded our operations primarily with proceeds from sales of preferred stock and from our public offerings. As of June 30, 2024, we had cash, cash equivalents, and investments of $162.9 million, excluding our restricted cash, or $176.4 million, including restricted cash.
Previous wording
Net cash used in operating activities for the three months ended March 31, 2024 was driven primarily by the following uses of cash:
Current wording
Net cash used in operating activities for the six months ended June 30, 2024 was driven primarily by the following uses of cash:
Previous wording
•$5.9 million change in accounts payable;
Current wording
•$9.2 million change in accounts payable;
Previous wording
•$3.5 million change in lease liabilities; and
Current wording
•$5.7 million change in lease liabilities;
Previous wording
•$4.5 million change in accrued expenses and other current liabilities; and
Current wording
•$3.9 million change in accrued expenses and other current liabilities; and
Previous wording
•$2.8 million change in prepaid and other current assets.
Current wording
•$2.5 million change in prepaid and other current assets.
Previous wording
These were offset by $8.2 million of non-cash amounts included in net loss, which primarily consisted of stock-based compensation expense, non-cash lease expense, depreciation and amortization expense, and change in fair value of short-term investment — related party.
Current wording
These were offset by $22.8 million of non-cash amounts included in net loss, which primarily consisted of stock-based compensation expense, non-cash lease expense, depreciation and amortization expense, and change in fair value of short-term investment — related party.
Previous wording
Net cash used in operating activities for the three months ended March 31, 2023 was driven primarily by the following uses of cash:
Current wording
Net cash used in operating activities for the six months ended June 30, 2023 was driven primarily by the following uses of cash:
Previous wording
•$2.8 million change in lease liabilities; and
Current wording
•$6.6 million change in lease liabilities;
Previous wording
•$1.3 million change in prepaid and other current assets.
Current wording
•$5.3 million change in prepaid and other current assets; and
Previous wording
•$4.0 million change in accrued expenses and other current liabilities;
Current wording
•$3.4 million change in accrued expenses and other current liabilities.
Previous wording
These were offset by $6.5 million of non-cash amounts included in net loss, which primarily consisted of change in fair value of short-term investment — related party, non-cash lease expense, and stock-based compensation expense.
Current wording
•$13.6 million of non-cash amounts included in net loss, which primarily consisted of change in fair value of short-term investment — related party, non-cash lease expense, and stock-based compensation expense; and
Previous wording
Net cash used in investing activities for the three months ended March 31, 2024 was driven primarily by the following uses of cash:
Current wording
Net cash used in investing activities for the six months ended June 30, 2024 was driven primarily by the following uses of cash:
Previous wording
•$10.7 million of purchases of marketable securities, net of maturities; and
Current wording
•$25.9 million of purchases of marketable securities, net of maturities; and
Previous wording
•$2.3 million of purchases of property and equipment.
Current wording
•$4.2 million of purchases of property and equipment.
Previous wording
•$34.7 million of purchases of marketable securities, net of maturities; offset by
Current wording
•$19.3 million of maturities of marketable securities, net of purchases; and
Previous wording
•$2.0 million of purchases of property and equipment.
Current wording
•$4.0 million of purchases of property and equipment.
Previous wording
Net cash provided by financing activities for the three months ended March 31, 2024 was driven primarily by the following:
Current wording
Net cash provided by financing activities for the six months ended June 30, 2024 was driven primarily by the following:
Previous wording
We believe our existing cash, cash equivalents, and investments will be sufficient to fund our operating expenses and capital expenditure requirements into the third quarter of 2025. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. We expect that we will require additional funding to:
Current wording
We believe our existing cash, cash equivalents, and investments will be sufficient to fund our operating expenses and capital expenditure requirements through the end of the second quarter of 2025. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. We expect that we will require additional funding to:
Previous wording
During the three months ended March 31, 2024, except for the minimum lease commitments disclosed in Note 7, Leases, to the unaudited condensed consolidated financial statements in this Quarterly Report on Form 10-Q, there were no significant changes to our contractual obligations and commitments described under Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2023.
Current wording
During the six months ended June 30, 2024, except for the minimum lease commitments disclosed in Note 7, Leases, to the unaudited condensed consolidated financial statements in this Quarterly Report on Form 10-Q, there were no significant changes to our contractual obligations and commitments described under Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2023.
Previous wording
Our management’s discussion and analysis of our financial condition and results of operations is based on our condensed consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States, or GAAP. The preparation of these condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses incurred during the reporting periods. We base our estimates on historical experience, known trends and events, and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities recorded revenues and expenses that are not readily apparent from other sources. We evaluate our estimates and assumptions on an ongoing basis. Actual results may differ from these estimates.
Current wording
Our management’s discussion and analysis of our financial condition and results of operations is based on our condensed consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses incurred during the reporting periods. We base our estimates on historical experience, known trends and events, and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities recorded revenues and expenses that are not readily apparent from other sources. We evaluate our estimates and assumptions on an ongoing basis. Actual results may differ from these estimates.
Previous wording
During the three months ended March 31, 2024, there were no material changes to our critical accounting policies and significant judgements described under Management’s Discussion and Analysis of Critical Accounting Policies and Significant Judgments and Estimates which are included in our Annual Report on Form 10-K for the year ended December 31, 2023.
Current wording
During the six months ended June 30, 2024, there were no material changes to our critical accounting policies and significant judgements described under Management’s Discussion and Analysis of Critical Accounting Policies and Significant Judgments and Estimates which are included in our Annual Report on Form 10-K for the year ended December 31, 2023.
Previous wording
A description of recently issued accounting pronouncements that may potentially impact our financial position and results of operations is disclosed in Note 2, Summary of Significant Accounting Policies, to our audited financial statements for the year ended December 31, 2023, and notes thereto, included in the Company’s Annual Report on Form 10-K.
Current wording
A description of recently issued accounting pronouncements that may potentially impact our financial position and results of operations is disclosed in Note 2, Summary of Significant Accounting Policies, to our audited financial statements for the year ended December 31, 2023, and notes thereto, included in our Annual Report on Form 10-K.
Rearranged current paragraphs (6)
Current report — wording carried from elsewhere
Comparison of the Six Months Ended June 30, 2024 and 2023
Current report — wording carried from elsewhere
The $15.4 million increase in research and development expense for the six months ended June 30, 2024 as compared to the six months ended June 30, 2023 was primarily driven by:
Current report — wording carried from elsewhere
•$7.3 million increase in facility-related expense primarily due to the expansion and build out of our laboratory space;
Current report — wording carried from elsewhere
•$7.4 million increase in personnel expense, including an increase in stock-based compensation expense of $3.6 million, driven by our increased headcount as we continue to build out our research and development function; and
Current report — wording carried from elsewhere
The $3.9 million increase in general and administrative expense for the six months ended June 30, 2024 as compared to the six months ended June 30, 2023 is primarily driven by $5.6 million increase in personnel expense, including an increase in stock-based compensation expense of $4.4 million, driven by growth in personnel as we operate as a public company and to support our growing research and development function.
Current report — wording carried from elsewhere
•$1.1 million change in accounts payable.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Net cash used in investing activities for the three months ended March 31, 2023 was driven primarily by the following: