tsvt-20230331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to ________

Commission file number 001-40791

2seventy bio, Inc.

(Exact name of registrant as specified in its charter)


Delaware						86-3658454
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)
60 Binney Street Cambridge, MA						02142
(Address of principal executive offices)						(Zip Code)

(339) 499-9300

(Registrant's telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.0001 per share	TSVT	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


			Large accelerated filer ☐			Accelerated filer ☐
			Non-accelerated filer ☒			Smaller reporting company ☒
						Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

The registrant had outstanding 50,199,268 shares of common stock as of May 4, 2023.

TABLE OF CONTENTS


		Page
Part I- Financial Information
Item 1.	Condensed Consolidated Balance Sheets as of March 31 , 202 3 and December 31, 20 2 2	1
	Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three Months Ended March 31 , 202 3 and March 3 1 , 20 2 2	2
	Condensed Consolidated Statements of Stockholders’ Equity for the Three Months Ended March 3 1 , 202 3 and March 31 , 20 2 2	3
	Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 3 1 , 202 3 and March 3 1 , 20 2 2	4
	Notes to Condensed Consolidated Financial Statements	5
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	39
Item 4.	Controls and Procedures	40
	Part II. Other Information
Item 1	Legal Proceedings	41
Item 1A.	Risk Factors	41
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	41
Item 3.	Defaults Upon Senior Securities	41
Item 4.	Mine Safety Disclosures	41
Item 5.	Other Information	41
Item 6.	Exhibit Index	42
	Signatures	44

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q and other materials we have filed or will file with the SEC include, or will include, forward-looking statements. All statements in this Quarterly Report on Form 10-Q, in other materials we have filed or will file with the SEC and in related comments by our management, other than statements of historical facts, including statements about future events, future financial position, business strategy, budgets, projected costs, plans and objectives of management for future operations, are forward-looking statements that involve certain risks and uncertainties. Use of the words “may,” “will,” “would,” “could,” “should,” “believes,” “estimates,” “projects,” “potential,” “expects,” “plans,” “seeks,” “intends,” “evaluates,” “pursues,” “anticipates,” “continues,” “designs,” “impacts,” “affects,” “forecasts,” “target,” “outlook,” “initiative,” “objective,” “designed,” “priorities,” “goal” or the negative of those words or other similar expressions may identify forward-looking statements that represent our current judgment about possible future events, but the absence of these words does not necessarily mean that a statement is not forward-looking.

Forward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other future conditions. Because forward-looking statements relate to the future, by their nature, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. As a result, our actual results may differ materially from those contemplated by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include regional, national or global political, economic, business, competitive, market and regulatory conditions and the following:

•our post-separation relationships with bluebird bio, Inc., or bluebird bio, third parties, collaborators and our employees;

•our and Bristol Myers Squibb’s, or BMS, plans for the continued commercialization of Abecma and the development and commercialization of earlier lines of therapy;

•our ability to finance our operations and business initiatives and obtain funding for such activities;

•the timing, investment and associated activities involved in developing, obtaining regulatory approval for, launching, and commercializing our product candidates;

•our plans with respect to the development, manufacture or sale of our product candidates and the associated timing thereof, including the design and results of pre-clinical and clinical studies;

•the operational capabilities and timelines with respect to our in-house manufacturing facility;

•sourcing supplies for the materials used to manufacture our product candidates;

•the safety profile and related adverse events of our product candidates;

•the perceived therapeutic benefits of our product candidates and the potential indications and market opportunities therefor;

•U.S. and foreign regulatory requirements for our product candidates, including any post-approval development and regulatory requirements, and the ability of our product candidates to meet such requirements;

•our ability to attract and retain key employees needed to execute our business plans and strategies and our expectations regarding our ability to manage the impact of any loss of key employees;

•our ability to obtain and maintain intellectual property protection for our product candidates and the strength thereof;

•our future financial performance, including estimates of our future revenues, expenses, payments, cash flows, profitability, tax obligations, capital requirements and our needs for additional financing and liquidity sources, real estate needs and concentration of voting control, as well as the timing and drivers thereof, and internal control over financial reporting;

•our ability to compete with other companies that are or may be developing or selling products that are competitive with our product candidates;

•the status of government regulation in the life sciences industry, particularly with respect to healthcare reform;

•the potential benefits of strategic collaboration agreements;

•potential indemnification liabilities we may owe to bluebird bio after the separation;

•our business and operations following the separation and any benefits or costs of the separation, including the tax treatment of the separation, the tax treatment of the distribution, and limitations imposed on us under the tax matters agreement that we entered into with bluebird bio in connection with the separation and distribution;

•the impact of rising inflation rates on our business, financial condition and results of operations;

•the fluctuation of the market price of our shares; and

•trends and challenges in our current and potential markets.

See “Risk Factors” for a further description of these and other factors. Although we have attempted to identify important risk factors, there may be other risk factors not presently known to us or that we presently believe are not material that could cause actual results and developments to differ materially from those made in or suggested by the forward-looking statements contained in this Quarterly Report on Form 10-Q. If any of these risks materialize, or if any of the above assumptions underlying forward-looking statements prove incorrect, actual results and developments may differ materially from those made in or suggested by the forward-looking statements contained in this Quarterly Report on Form 10-Q. For the reasons described above, we caution you against relying on any forward-looking statements, which should also be read in conjunction with the other cautionary statements that are included elsewhere in this Quarterly Report on Form 10-Q. Any forward-looking statement made by us in this Quarterly Report on Form 10-Q speaks only as of the date thereof. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update or to revise any forward-looking statement, whether as a result of new information, future developments, or otherwise, except as may be required by law.

PART I. FINANCIAL INFORMATION

Item 1. Financial Information

2seventy bio, Inc.

Condensed Consolidated Balance Sheets

(unaudited)

(in thousands, except par value amounts)


	As of March 31, 2023		As of December 31, 2022
Assets
Current assets:
Cash and cash equivalents	$	193,629	$	71,032
Marketable securities	146,301		195,238
Prepaid expenses	8,635		13,652
Receivables and other current assets	41,252		20,960
Total current assets	389,817		300,882
Property, plant and equipment, net	59,153		55,735
Marketable securities	1,432		1,414
Intangible assets, net	7,125		7,302
Goodwill	12,056		12,056
Operating lease right-of-use assets	235,264		240,885
Restricted investments and other non-current assets	37,590		38,391
Total assets	$	742,437	$	656,665
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	13,399	$	7,208
Accrued expenses and other current liabilities	43,568		54,678
Operating lease liability, current portion	11,482		11,164
Deferred revenue, current portion	8,480		3,000
Collaboration research advancement	—		3,744
Total current liabilities	76,929		79,794
Deferred revenue, net of current portion	6,311		5,000
Operating lease liability, net of current portion	255,472		259,008
Other non-current liabilities	2,401		2,397
Total liabilities	341,113		346,199
Commitments and contingencies (Note 8)
Stockholders’ equity:
Preferred stock, $0.0001 par value; 10,000 shares authorized, 0 shares issued and outstanding at March 31, 2023 and December 31, 2022	—		—
Common stock, $0.0001 par value; 200,000 shares authorized, 50,190 and 37,928 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively	5		4
Additional paid-in capital	743,937		606,986
Accumulated other comprehensive loss	(1,950)		(2,877)
Accumulated deficit	(340,668)		(293,647)
Total stockholders’ equity	401,324		310,466
Total liabilities and stockholders’ equity	$	742,437	$	656,665

See accompanying notes to unaudited condensed consolidated financial statements.

2seventy bio, Inc.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(unaudited)

(in thousands, except per share data)


	For the three months ended March 31,
	2023		2022
Revenue:
Service revenue	$	10,826	$	4,055
Collaborative arrangement revenue	29,372		3,487
Royalty and other revenue	1,423		887
Total revenues	41,621		8,429
Operating expenses:

SEC Form 10-Q filed by 2seventy bio Inc.