| Item 1.01. | Entry into a Material Definitive Agreement. |
On December 19, 2023, bluebird bio, Inc. (the “Company”) entered into an underwriting agreement (the “Underwriting Agreement”) with Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC, as representatives of the several underwriters listed on Schedule I attached thereto (the “Underwriters”), in connection with the public offering, issuance and sale by the Company of 83,333,333 shares of the Company’s common stock, $0.01 par value per share (the “Common Stock”), at a public offering price of $1.50 per share, less underwriting discounts and commissions, pursuant to an effective shelf registration statement on Form S-3 (Registration No. 333-271772) and a related final prospectus supplement that will be filed with the Securities and Exchange Commission (the “Offering”). Under the terms of the Underwriting Agreement, the Company also granted the Underwriters an option exercisable for 30 days to purchase up to an additional 12,499,999 shares of Common Stock at the public offering price, less underwriting discounts and commissions. The closing of the Offering is expected to occur on or about December 22, 2023, subject to the satisfaction of customary closing conditions.
The Company expects to receive net proceeds from the Offering of approximately $118.3 million, after deducting underwriting discounts and commissions and estimated offering expenses payable by the Company. The Company intends to use the net proceeds of the Offering to support commercialization and manufacturing for its three approved gene therapies, ZYNTEGLO, SKYSONA and LYFGENIA, and to fund working capital and other general corporate purposes. Based on the Company’s current business plan, the Company anticipates that its cash, cash equivalents, and marketable securities excluding restricted cash, together with the net proceeds of this offering, and anticipated cash flows from operations (taking into account the effect of its accounts receivable-backed factoring agreement), will be sufficient to fund its operations into the first quarter of 2025. The Company’s expectations regarding its anticipated cash runway into the first quarter of 2025 may be affected by many factors, including its ability to execute its current business plan, the ongoing commercialization of the Company’s three approved products, the number of patient starts for the Company’s three approved products, and its realization of anticipated revenue. These expectations are based on estimates and the judgment of management. The Company’s cash runway may not extend as far as it has forecasted and anticipated cash needs could be greater than the Company expects.
The Underwriting Agreement contains customary representations, warranties and covenants by the Company, customary conditions to closing, indemnification obligations of the Company and the Underwriters, including for liabilities under the Securities Act of 1933, as amended, other obligations of the parties and termination provisions. The representations, warranties and covenants contained in the Underwriting Agreement were made solely for the benefit of the parties thereto and may be subject to limitations agreed upon by the contracting parties. Accordingly, the Underwriting Agreement is incorporated herein by reference only to provide investors with information regarding the terms of the Underwriting Agreement and not to provide investors with any other factual information regarding the Company or its business, and should be read in conjunction with the disclosures in the Company’s periodic reports and other filings with the Securities and Exchange Commission.
The foregoing description of the Underwriting Agreement is not complete and is qualified in its entirety by reference to the full text of the Underwriting Agreement, a copy of which is filed as Exhibit 1.1 to this Current Report on Form 8-K (the “Current Report”) and is incorporated by reference herein.
Latham & Watkins LLP, counsel to the Company, has issued an opinion to the Company, dated December 20, 2023, regarding the validity of the shares of Common Stock to be issued and sold in the offering. A copy of the opinion is filed as Exhibit 5.1 to this Current Report.
Forward-Looking Statements
This Current Report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this Current Report that do not relate to matters of historical fact should be considered forward-looking statements, including without limitation statements regarding the Company’s expectations regarding its cash runway, the consummation of the offering, the terms of the offering, the satisfaction of customary closing conditions with respect to the offering, the anticipated amount of net proceeds from the offering and the intended use of such net proceeds. Statements using words such as “expect”, “anticipate”, “believe”, “may”, “will” and similar terms are also forward-looking statements. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause its actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, the important factors discussed under the caption “Risk Factors” in the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2023 and its other filings with the Securities and Exchange Commission. Except as required by law, the Company undertakes no obligations to make any revisions to the forward-looking statements contained in this Current Report or to update them to reflect events or circumstances occurring after the date of this Current Report, whether as a result of new information, future developments or otherwise.
