Intellia Therapeutics, Inc. — Q3 2022 Form 10-Q
Reporting period: Quarter and nine months ended September 30, 2022. The financial statements are unaudited. Intellia is a clinical-stage CRISPR/Cas9 genome-editing company developing in vivo and ex vivo therapies. All revenue to date was collaboration revenue; the company had no approved products or product sales.
Financial performance
Amounts are in millions of dollars except per-share data.
| Metric | Q3 2022 | Q3 2021 | Nine months 2022 | Nine months 2021 |
|---|---|---|---|---|
| Collaboration revenue | $13.3 | $7.2 | $38.5 | $20.2 |
| Research and development expense | $96.7 | $60.5 | $319.9 | $158.6 |
| General and administrative expense | $22.1 | $18.7 | $66.7 | $49.0 |
| Operating loss | $(105.5) | $(72.0) | $(348.1) | $(187.4) |
| Net loss | $(113.2) | $(71.6) | $(360.8) | $(186.7) |
| Net loss per share, basic and diluted | $(1.49) | $(0.97) | $(4.78) | $(2.68) |
- Revenue increased year over year, primarily from AvenCell and Kyverna collaboration activity. Revenue remains small relative to research and development spending; conventional gross margin is not presented.
- R&D expense rose substantially, reflecting increased program and pipeline investment, employee and stock-based compensation costs, and a $56.0 million Rewrite in-process research and development charge. G&A also increased, mainly with workforce-related costs.
- Nine-month net cash used in operating activities was $243.4 million, compared with $170.4 million in 2021. Investing activities provided $190.5 million, primarily reflecting marketable-security maturities; financing provided $77.2 million, mainly from at-the-market stock sales and option exercises.
Balance sheet and liquidity
- At September 30, 2022, cash, cash equivalents and marketable securities totaled approximately $848.7 million; cash and cash equivalents alone were $141.2 million. Cash, cash equivalents and restricted cash equivalents were $149.7 million.
- Total assets were $1,084.5 million; stockholders’ equity was $825.0 million. Accumulated deficit was $1,063.8 million.
- No borrowings or debt balance is reported in the supplied balance sheet. Operating lease liabilities totaled $97.6 million, including current and long-term portions.
- Management expected September 30 liquidity, together with specified research and cost-reimbursement funding, to fund operating and capital needs beyond 24 months, excluding potential collaboration milestones and strategic uses of capital. The estimate depends on assumptions that may prove incorrect.
- After quarter-end, through October 27, the company reported $107.2 million in additional net ATM proceeds from issuing 1,864,527 shares. September-dated ATM proceeds of $8.3 million were also settled in October.
Material changes, outlook and risks
- For the nine months, the net loss widened by $174.1 million year over year. R&D expense more than doubled, while collaboration revenue increased by $18.3 million.
- Unusual items included the $56.0 million Rewrite acquisition charge and $8.1 million of expense from remeasuring Rewrite contingent consideration. Intellia also recorded a $7.8 million equity-method investment loss, primarily related to AvenCell.
- Rewrite was acquired for approximately $45.0 million upfront, with up to $155.0 million in additional milestone payments. The contingent consideration liability was $18.6 million at quarter-end; cash milestones had not been resolved.
- Management expected expenses to increase in the final quarter of 2022 as clinical programs, research and development staffing, and pipeline activity advanced. The filing provides no specific revenue, earnings or cash-burn guidance.
- Clinical updates were encouraging but preliminary: NTLA-2001 interim ATTR-CM data showed mean serum TTR reductions of 93% and 92% at day 28 at the 0.7 mg/kg and 1.0 mg/kg doses. One patient in the ATTRv-PN dose-expansion study had a significant liver-enzyme elevation that normalized without intervention; this informed study of a lower fixed dose. NTLA-2002 interim results included dose-dependent plasma kallikrein reductions and a reported mean 91% reduction in HAE attacks in the 25 mg cohort. These interim findings do not establish safety, efficacy or approval.
- Intellia discontinued the first-in-human NTLA-5001 study and shifted the program to an allogeneic version in preclinical development; management said the decision was not prompted by trial safety or efficacy data. The company planned an IND or equivalent filing for NTLA-3001 in 2023 and expected the NTLA-2002 Phase 2 dose-expansion study to begin in the first half of 2023.
- Key risks include early-stage clinical and regulatory uncertainty, potentially serious or irreversible genome-editing effects, manufacturing and trial-enrollment challenges, reliance on collaborators and external funding, and substantial competition. The filing also describes significant CRISPR intellectual-property disputes, including pending appeals concerning the UC/Vienna/Charpentier and Broad Institute patent families. No material new litigation was reported.
- Management concluded disclosure controls were effective at the reasonable-assurance level; no material change in internal control over financial reporting was reported for the quarter.
Important facts for investors to verify
- Whether subsequent, completed clinical-trial data confirm the preliminary NTLA-2001 and NTLA-2002 results and clarify safety, dose selection and durability.
- Whether clinical and regulatory milestones, including the NTLA-2002 Phase 2 start and NTLA-3001 filing, remain on schedule.
- Actual cash burn and runway versus management’s forecast, including the effect of expansion, manufacturing plans and collaboration funding.
- Potential future dilution: ATM capacity remaining at September 30 was $367.5 million, and additional shares were sold after quarter-end.
- Progress and potential payment obligations from the Rewrite milestones, as well as AvenCell’s performance and the valuation of Intellia’s related investment.
- Developments in CRISPR patent proceedings and any effects on Intellia’s ability to develop or commercialize its programs.