prme-20240930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


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

For the quarterly period ended September 30, 2024


☐			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 001-41536

Prime Medicine, Inc.

(Exact name of registrant as specified in its charter)


Delaware						84-3097762
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

60 First Street, Cambridge, MA						02141
(Address of principal executive offices)						(Zip code)

(617) 465-0013

(Registrant’s telephone number, including area code)

Not applicable

(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 $0.00001 per share	PRME	Nasdaq Global Market

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

As of October 31, 2024, the registrant had 131,160,842 shares of common stock, par value $0.00001 per share, outstanding.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains express or implied statements which are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements, other than statements of historical facts, contained in this Quarterly Report on Form 10-Q, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans, and objectives of management, are forward-looking statements, which are based on management’s belief and assumptions and on information currently available to our management. These statements involve substantial risks, assumptions and uncertainties. The words “anticipate,” “believe,” “envision,” “estimate,” “expect,” “goal,” “intend,” “may,” “plan,” “predict,” “project,” “strategy,” “target,” “potential,” “will,” “would,” “could,” “should,” “continue,” “contemplate,” “vision” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words.

The forward-looking statements in this Quarterly Report on Form 10-Q include statements about:

•the initiation, timing, progress and results of our research and development programs, product candidates, preclinical studies and future clinical trials;

•our ability to demonstrate, and the timing of, preclinical proof-of-concept in vivo for multiple programs;

•our ability to advance any current and future product candidates that we may identify and successfully complete any clinical studies, including the manufacture of any such product candidates;

•our ability to pursue our areas of focus and any other additional programs we may advance;

•our ability to quickly leverage programs within our initial target indications and to progress additional programs to further develop our pipeline;

•the timing of our investigational new drug application submissions;

•the ability of our Prime Editing technology to address unmet medical needs in patients;

•the implementation of our strategic plans for our business, programs and technology;

•the scope and duration of protection we are able to establish and maintain for intellectual property rights covering our Prime Editing technology;

•developments related to our competitors and our industry;

•our ability to leverage the clinical, regulatory, and manufacturing advancements made by gene therapy and gene editing programs to accelerate our clinical trials and approval of product candidates;

•our ability to identify and enter into future license agreements and collaborations;

•developments related to our Prime Editing technology;

•regulatory developments in the United States and foreign countries;

•our ability to attract and retain key scientific and management personnel;

•our estimates of our expenses, capital requirements, needs for additional financing;

•the effect of unfavorable macroeconomic conditions or market volatility resulting from global economic conditions,

•our expectations regarding the anticipated timeline of our cash runway, future financial performance and our ability to continue as a going concern; and

•other risks and uncertainties, including those listed under the caption “Risk Factors.”

We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and these statements may be affected by inaccurate assumptions or by known or unknown risks and uncertainties. You should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements we make. We have included important factors in the cautionary statements included in this Quarterly Report on Form 10-Q and in subsequent SEC filings, particularly in the “Risk Factors” section, that we believe could cause actual results or events to differ materially from the forward-looking statements that we make. Unless otherwise disclosed, our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, collaborations, joint ventures or investments we may make or enter into.

You should read this Quarterly Report on Form 10-Q and the documents that we reference herein and have filed as exhibits to our other filings with the Securities and Exchange Commission (the “SEC”) completely and with the understanding that our actual future results may be materially different from what we expect. The forward-looking statements contained in this Quarterly Report on Form 10-Q are made as of the date hereof, and we do not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise after the date of such statements, except as required by applicable law.

This Quarterly Report on Form 10-Q also contains estimates, projections and other information concerning our industry, our business and the markets for our product candidates. Such information is inherently subject to uncertainties and actual events or circumstances may differ materially from events and circumstances that are assumed in this information. Unless otherwise expressly stated, we obtained this data from our own internal estimates and research as well as from reports, research surveys, studies and similar data prepared by market research firms and other third parties, industry, medical and general publications, government data and similar sources. While we are not aware of any misstatements regarding any third-party information presented in this Quarterly Report on Form 10-Q, their estimates, in particular as they relate to projections, involve numerous assumptions, are subject to risks and uncertainties and are subject to change based on various factors, including those discussed under the section titled “Risk Factors” set forth in Part II, Item 1A of this Quarterly Report on Form 10-Q, if any, our Annual Report on Form 10-K that was filed with the SEC on March 1, 2024, and in other SEC filings.

PRIME MEDICINE, INC.

FORM 10-Q

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024

TABLE OF CONTENTS


		Page
PART I - FINANCIAL INFORMATION		5
Item 1.	Financial Statements (unaudited)	5
	Condensed Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023	5
	Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three and Nine Months Ended September 30, 2024 and 2023	6
	Condensed Consolidated Statements of Stockholders ’ Equity for the Three and Nine Months Ended September 30, 2024 and 2023	7
	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2024 and 2023	9
	Notes to Condensed Consolidated Financial Statements	11
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	35
Item 4.	Controls and Procedures	35

PART II - OTHER INFORMATION		37
Item 1.	Legal Proceedings	37
Item 1A.	Risk Factors	37
Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities	37
Item 3.	Defaults Upon Senior Securities	38
Item 4.	Mine Safety Disclosure	38
Item 5.	Other Information	38
Item 6.	Exhibits	39
	Signatures	41

From time to time we may use our website, our X (formerly known as Twitter) account (@PrimeMedicine) or our LinkedIn profile at https://www.linkedin.com/company/prime-medicine to distribute material information. Our financial and other material information is routinely posted to and accessible on the Investors section of our website, available at www.primemedicine.com. Investors are encouraged to review the Investors section of our website because we may post material information on that site that is not otherwise disseminated by us. Information that is contained in and can be accessed through our website or our social media is not incorporated into, and does not form a part of, this Quarterly Report on Form 10-Q.

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements (unaudited)

PRIME MEDICINE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


(in thousands, except share and per share amounts)	September 30, 2024		December 31, 2023
Assets
Current assets:
Cash and cash equivalents	$	117,977	$	41,574
Short-term investments	52,642		74,639
Short-term investment — related party	4,908		5,452
Collaboration receivable — related party	55,000		—
Prepaid expenses	6,006		19,057
Other current assets	9,538		2,254
Total current assets	246,071		142,976

Property and equipment, net	23,287		22,659
Operating lease right-of-use assets	49,364		13,941
Restricted cash	14,062		13,496
Other assets	—		779
Total assets	$	332,784	$	193,851
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	5,429	$	19,537
Accrued expenses and other current liabilities (1)	18,684		14,110
Accrued settlement payment — related party	—		13,500
Deferred revenue — related party	9,280		—
Operating lease liability	4,484		9,276
Total current liabilities	37,877		56,423
Deferred revenue, net of current — related party	62,639		—
Operating lease liability, net of current	36,764		4,357

Research and development funding liability	6,000		—
Total liabilities	143,280		60,780
Commitments and contingencies
Stockholders’ equity
Common stock, par value of $0.00001 per share; 775,000,000 shares authorized; 131,160,842 and 97,377,121 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively	2		2
Additional paid-in capital	834,417		624,414
Accumulated other comprehensive loss	21		(15)
Accumulated deficit	(644,936)		(491,330)
Total stockholders’ equity	189,504		133,071
Total liabilities and stockholders’ equity	$	332,784	$	193,851

(1) Includes related party amount of $0.1 million as of December 31, 2023.

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

PRIME MEDICINE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands, except share and per share amounts)	2024		2023		2024		2023
Collaboration revenue	$	209	$	—	$	800	$	—
Operating expenses:
Research and development (1)	40,340		40,967		121,185		106,446
General and administrative	14,101		10,492		37,860		30,303
Total operating expenses	54,441		51,459		159,045		136,749
Loss from operations	(54,232)		(51,459)		(158,245)		(136,749)
Other income:
Accretion (amortization) of investments	885		1,769		3,201		4,551
Interest income	697		410		1,984		2,320
Change in fair value of short-term investment — related party	215		(1,579)		(544)		(3,017)
Other income, net	(83)		43		(2)		126
Total other income, net	1,714		643		4,639		3,980
Net loss before income taxes	(52,518)		(50,816)		(153,606)		(132,769)
Benefit from income taxes	—		108		—		279



Net loss attributable to common stockholders	$	(52,518)	$	(50,708)	$	(153,606)	$	(132,490)
Net loss per share attributable to common stockholders, basic and diluted	$	(0.44)	$	(0.55)	$	(1.34)	$	(1.46)
Weighted-average common shares outstanding, basic and diluted	119,764,270		91,846,835		114,492,416		90,469,866

Comprehensive loss:
Net loss	$	(52,518)	$	(50,708)	$	(153,606)	$	(132,490)
Change in unrealized loss on investments, net of tax	92		119		36		235
Comprehensive loss	$	(52,426)	$	(50,589)	$	(153,570)	$	(132,255)

(1) Includes related party amount of $0.1 million and $0.8 million for the three and nine months ended September 30, 2023.

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

PRIME MEDICINE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)


	Common Stock			Additional Paid-in Capital		Accumulated Other Comprehensive Losses		Accumulated Deficit		Total Stockholders’ Equity
(in thousands, except share amounts)	Shares	Amount
Balance as of December 31, 2023	97,377,121	$	2	$	624,414	$	(15)	$	(491,330)	$	133,071
Issuance of common stock from public offering, net of issuance costs of $8.9 million	22,560,001	—		132,055		—		—		132,055
Issuance of pre-funded warrants, net of issuance costs of $1.2 million	—	—		18,800		—		—		18,800
Issuances of common stock under the employee stock purchase plan	74,488	—		436		—		—		436
Issuance of common stock upon exercise of stock options	9,664	—		36		—		—		36
Stock-based compensation expense	—	—		5,209		—		—		5,209
Change in unrealized loss on investments, net of tax	—	—		—		(80)		—		(80)
Net loss	—	—		—		—		(45,761)		(45,761)
Balance as of March 31, 2024	120,021,274	2		780,950		(95)		(537,091)		243,766
Issuance of common stock upon exercise of stock options	9,539	—		35		—		—		35
Stock-based compensation expense	—	—		8,091		—		—		8,091
Change in unrealized loss on investments, net of tax	—	—		—		24		—		24
Net loss	—	—		—		—		(55,327)		(55,327)
Balance as of June 30, 2024	120,030,813	$	2	$	789,076	$	(71)	$	(592,418)	$	196,589
Issue of common stock under the Securities Purchase Agreement to BMS — related party (Note 9)	11,006,163	—		38,081		—		—		38,081
Issuances of common stock under the employee stock purchase plan	115,021	—		401		—		—		401
Issuance of common stock upon exercise of stock options	8,845	—		32		—		—		32
Stock-based compensation expense	—	—		6,827		—		—		6,827
Change in unrealized loss on investments, net of tax	—	—		—		92		—		92
Net loss	—	—		—		—		(52,518)		(52,518)
Balance as of September 30, 2024	131,160,842	$	2	$	834,417	$	21	$	(644,936)	$	189,504

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

PRIME MEDICINE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)


	Common Stock	Additional Paid-in Capital		Accumulated Other Comprehensive Losses		Accumulated Deficit			Total Stockholders’ Equity
(in thousands, except share amounts)			Shares					Amount
Balance as of December 31, 2022		97,209,213		$	2	$	609,849		$	(384)	$	(293,197)	$	316,270
Issuance of common stock upon exercise of stock options		18,596		—		68			—		—		68
Stock-based compensation expense		—		—		1,681			—		—		1,681
Change in unrealized loss on investments, net of tax		—		—		—			179		—		179
Net loss		—		—		—			—		(39,397)		(39,397)
Balance as of March 31, 2023		97,227,809		2		611,598			(205)		(332,594)		278,801
Issuance of common stock upon exercise of stock options		42,106		—		166			—		—		166
Stock-based compensation expense		—		—		3,583			—		—		3,583
Change in unrealized loss on investments, net of tax		—		—		—			(63)		—		(63)
Net loss		—		—		—			—		(42,385)		(42,385)
Balance as of June 30, 2023		97,269,915		$	2	$	615,347		$	(268)	$	(374,979)	$	240,102
Issuance of common stock upon exercise of stock options		54,386		—		227			—		—		227
Stock-based compensation expense		—		—		4,217			—		—		4,217
Change in unrealized loss on investments, net of tax		—		—		—			119		—		119
Net loss		—		—		—			—		(50,708)		(50,708)
Balance as of September 30, 2023		97,324,301		$	2	$	619,791		$	(149)	$	(425,687)	$	193,957

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

PRIME MEDICINE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	Nine Months Ended September 30,
(in thousands)	2024		2023
Cash flows used in operating activities:
Net loss	$	(153,606)	$	(132,490)
Adjustments to reconcile net loss to net cash used in operating activities
Stock-based compensation expense	20,127		9,481
Non cash lease expense	10,147		9,440
Depreciation expense	4,411		3,406
Change in fair value of short-term investment — related party	544		3,017
Amortization of premiums and discount on short-term investments	(2,949)		(2,320)
Deferred income taxes	—		(279)

Changes in operating assets and liabilities:
Collaboration receivable — related party	(55,000)		—
Prepaid expenses and other current assets	(9,466)		(9,040)
Accounts payable	(7,717)		6,861
Accrued expenses and other current liabilities	1,987		(755)
Accrued settlement payment — related party	(13,500)		—
Deferred revenue — related party

SEC Form 10-Q filed by Prime Medicine Inc.