Precision BioSciences (DTIL) 10-Q 8 Nov 22 2022 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2022	Nov. 03, 2022
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2022
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2022
Entity Registrant Name	PRECISION BIOSCIENCES INC
Entity Central Index Key	0001357874
Trading Symbol	DTIL
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Common Stock, Shares Outstanding		110,958,955
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Shell Company	false
Entity Ex Transition Period	false
Entity File Number	001-38841
Entity Tax Identification Number	20-4206017
Entity Address, Address Line One	302 East Pettigrew St.
Entity Address, Address Line Two	Suite A-100
Entity Address, City or Town	Durham
Entity Address, State or Province	NC
Entity Address, Postal Zip Code	27701
City Area Code	919
Local Phone Number	314-5512
Title of 12(b) Security	Common Stock, par value $0.000005 per share
Security Exchange Name	NASDAQ
Entity Incorporation, State or Country Code	DE
Document Quarterly Report	true
Document Transition Report	false

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 212,051	$ 143,663
Accounts receivable	715	488
Prepaid expenses	12,292	17,434
Other current assets	307	169
Total current assets	225,365	161,754
Property, equipment, and software—net	21,791	25,154
Intangible assets—net	1,969	2,048
Right-of-use assets—net	3,289	4,180
Investment in equity securities	3,091	3,091
Equity method investment		3,751
Note receivable—net	6,711	6,879
Other assets	9,517	4,641
Total assets	271,733	211,498
Current liabilities:
Accounts payable	1,061	1,144
Accrued compensation	5,188	6,765
Accrued clinical and research and development expenses	3,285	4,028
Deferred revenue	48,405	21,244
Lease liabilities	1,981	1,822
Other current liabilities	1,228	977
Total current liabilities	61,148	35,980
Deferred revenue	90,510	67,015
Lease liabilities	3,305	4,813
Long term debt—net	22,173	2,478
Contract liabilities	10,000	10,000
Other noncurrent liabilities	217	44
Total liabilities	187,353	120,330
Commitments and contingencies (Note 4)
Stockholders’ equity:
Preferred stock, $0.0001 par value- 10,000,000 shares authorized as of September 30, 2022 and December 31, 2021; no shares issued and outstanding as of September 30, 2022 and December 31, 2021
Common stock; $0.000005 par value- 200,000,000 shares authorized as of September 30, 2022 and December 31,2021; 111,745,219 shares issued and 110,934,747shares outstanding as of September 30, 2022; 61,712,577 shares issued and 60,902,105 shares outstanding as of December 31, 2021	1
Additional paid-in capital	485,155	408,795
Accumulated deficit	(399,824)	(316,675)
Treasury stock	(952)	(952)
Total stockholders’ equity	84,380	91,168
Total liabilities and stockholders’ equity	$ 271,733	$ 211,498

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares	Sep. 30, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.000005	$ 0.000005
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	111,745,219	61,712,577
Common stock, shares outstanding	110,934,747	60,902,105

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Income Statement [Abstract]
Revenue	$ 7,363	$ 24,036	$ 14,500	$ 109,190
Operating expenses
Research and development	19,959	25,940	62,867	88,768
General and administrative	10,334	9,638	31,510	29,074
Total operating expenses	30,293	35,578	94,377	117,842
Operating loss	(22,930)	(11,542)	(79,877)	(8,652)
Other income (expense):
Change in fair value of equity investment		274		274
Loss from equity method investment	(1,783)		(4,183)
Interest expense	(405)	(55)	(625)	(79)
Interest income	1,172	44	1,536	145
Total other income (expense), net	(1,016)	263	(3,272)	340
Net loss	$ (23,946)	$ (11,279)	$ (83,149)	$ (8,312)
Net loss per share - basic	$ (0.22)	$ (0.19)	$ (1.04)	$ (0.14)
Net loss per share - diluted	$ (0.22)	$ (0.19)	$ (1.04)	$ (0.14)
Weighted average shares of common stock outstanding - basic	110,849,196	59,657,677	80,127,701	58,018,550
Weighted average shares of common stock outstanding - diluted	110,849,196	59,657,677	80,127,701	58,018,550

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Treasury Stock
Beginning balance at Dec. 31, 2020	$ 44,425		$ 331,450	$ (286,073)	$ (952)
Beginning balance, Shares at Dec. 31, 2020		53,503,124
Stock option exercises	1,297		1,297
Stock option exercises, Shares		676,791
Issuance of common stock under employee stock purchase plan	418		418
Issuance of common stock under employee stock purchase plan, Shares		90,796
Share-based compensation expense	3,632		3,632
Issuance of common stock to collaboration partners	27,739		27,739
Issuance of common stock to collaboration partners, Shares		3,762,190
Net income (loss)	(18,689)			(18,689)
Ending balance at Mar. 31, 2021	58,822		364,536	(304,762)	(952)
Ending balance, Shares at Mar. 31, 2021		58,032,901
Beginning balance at Dec. 31, 2020	44,425		331,450	(286,073)	(952)
Beginning balance, Shares at Dec. 31, 2020		53,503,124
Net income (loss)	(8,312)
Ending balance at Sep. 30, 2021	101,443		396,780	(294,385)	(952)
Ending balance, Shares at Sep. 30, 2021		60,892,018
Beginning balance at Mar. 31, 2021	58,822		364,536	(304,762)	(952)
Beginning balance, Shares at Mar. 31, 2021		58,032,901
Stock option exercises	1,353		1,353
Stock option exercises, Shares		766,767
Share-based compensation expense	3,896		3,896
Proceeds from issuance of common stock, net of issuance cost	14,826		14,826
Proceeds from issuance of common stock, net of issuance cost, Shares		1,293,754
Net income (loss)	21,656			21,656
Ending balance at Jun. 30, 2021	100,553		384,611	(283,106)	(952)
Ending balance, Shares at Jun. 30, 2021		60,093,422
Stock option exercises	3,393		3,393
Stock option exercises, Shares		414,073
Issuance of common stock under employee stock purchase plan	386		386
Issuance of common stock under employee stock purchase plan, Shares		36,091
Share-based compensation expense	4,551		4,551
Proceeds from issuance of common stock, net of issuance cost	3,839		3,839
Proceeds from issuance of common stock, net of issuance cost, Shares		348,432
Net income (loss)	(11,279)			(11,279)
Ending balance at Sep. 30, 2021	101,443		396,780	(294,385)	(952)
Ending balance, Shares at Sep. 30, 2021		60,892,018
Beginning balance at Dec. 31, 2021	$ 91,168		408,795	(316,675)	(952)
Beginning balance, Shares at Dec. 31, 2021	61,712,577	61,712,577
Stock option exercises	$ 340		340
Stock option exercises, Shares		233,001
Issuance of common stock under employee stock purchase plan	282		282
Issuance of common stock under employee stock purchase plan, Shares		78,060
Share-based compensation expense	4,390		4,390
Proceeds from issuance of common stock, net of issuance cost	1,647		1,647
Proceeds from issuance of common stock, net of issuance cost, Shares		561,405
Net income (loss)	(28,168)			(28,168)
Ending balance at Mar. 31, 2022	69,659		415,454	(344,843)	(952)
Ending balance, Shares at Mar. 31, 2022		62,585,043
Beginning balance at Dec. 31, 2021	$ 91,168		408,795	(316,675)	(952)
Beginning balance, Shares at Dec. 31, 2021	61,712,577	61,712,577
Stock option exercises, Shares	330,359
Net income (loss)	$ (83,149)
Ending balance at Sep. 30, 2022	$ 84,380	$ 1	485,155	(399,824)	(952)
Ending balance, Shares at Sep. 30, 2022	111,745,219	111,745,219
Beginning balance at Mar. 31, 2022	$ 69,659		415,454	(344,843)	(952)
Beginning balance, Shares at Mar. 31, 2022		62,585,043
Stock option exercises	38		38
Stock option exercises, Shares		78,234
Share-based compensation expense	5,138		5,138
Proceeds from issuance of common stock, net of issuance cost	47,670		47,670
Proceeds from issuance of common stock, net of issuance cost, Shares		36,274,651
Issuance of common stock to collaboration partners	11,553		11,553
Issuance of common stock to collaboration partners, Shares		12,407,440
Restricted stock units vested, Shares		260,137
Net income (loss)	(31,035)			(31,035)
Ending balance at Jun. 30, 2022	103,023		479,853	(375,878)	(952)
Ending balance, Shares at Jun. 30, 2022		111,605,505
Stock option exercises	9		9
Stock option exercises, Shares		19,124
Issuance of common stock under employee stock purchase plan	161	$ 1	160
Issuance of common stock under employee stock purchase plan, Shares		116,612
Share-based compensation expense	5,133		5,133
Restricted stock units vested, Shares		3,978
Net income (loss)	(23,946)			(23,946)
Ending balance at Sep. 30, 2022	$ 84,380	$ 1	$ 485,155	$ (399,824)	$ (952)
Ending balance, Shares at Sep. 30, 2022	111,745,219	111,745,219

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Cash flows from operating activities:
Net loss	$ (83,149)	$ (8,312)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	5,838	6,806
Share-based compensation	14,661	12,079
Loss on disposal of assets	58	23
Non-cash interest expense	210	42
Amortization of right-of-use assets	891	897
Non-cash consideration received from collaboration partners		(17,894)
Change in fair value of equity investments		(274)
Loss from equity method investment	4,183
Amortization of discount on note receivable	(264)
Changes in operating assets and liabilities:
Prepaid expenses	5,142	(323)
Accounts receivable	(227)	9,512
Other assets and other current assets	(4,689)	47
Accounts payable	(187)	240
Other liabilities and other current liabilities	(2,237)	(976)
Deferred revenue	37,209	2,391
Lease liabilities and right-of-use assets	(1,349)	(1,430)
Contract liabilities		10,000
Net cash (used in) provided by operating activities	(23,910)	12,828
Cash flows from investing activities:
Purchases of property, equipment and software	(2,687)	(3,548)
Purchases of intangible assets		(750)
Net cash used in investing activities	(2,687)	(4,298)
Cash flows from financing activities:
Proceeds from stock option exercises	387	5,757
Proceeds from employee stock purchase plan	443	804
Proceeds from offering of common stock, net of issuance costs	49,345	18,130
Proceeds from issuance of common stock to collaboration partners	25,000	35,000
Borrowings from revolving credit facility, net of issuance costs	19,810
Proceeds from issuance of term loan, net of issuance costs paid to lender		2,465
Payments of debt issuance costs		(13)
Net cash provided by financing activities	94,985	62,143
Net increase in cash and cash equivalents	68,388	70,673
Cash and cash equivalents—beginning of period	143,663	89,798
Cash and cash equivalents —end of period	212,051	160,471
Supplemental disclosures of noncash activities:
Property, equipment and software additions included in accounts payable and accrued expenses other current liabilities	232	695
Cash paid for interest	$ 422	36
Unsettled at-the-market issuances of common stock included in other current assets		549
Contract liability accrual related to Servier Program Purchase Agreement milestones		10,000
Non-cash consideration received from collaboration partners		$ 17,894

Description of Business and Sum

Description of Business and Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	NOTE 1: DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Business Precision BioSciences, Inc. (the “Company”) was incorporated on January 26, 2006 under the laws of the State of Delaware and is based in Durham, North Carolina. The Company is a clinical stage gene editing company dedicated to improving life by developing ex vivo allogeneic CAR T immunotherapies and in vivo therapies for genetic and infectious diseases with the application of the Company’s wholly owned proprietary ARCUS genome editing platform. Since its inception, the Company has devoted substantially all of its efforts to research and development activities, recruiting skilled personnel, developing manufacturing processes, establishing its intellectual property portfolio and providing general and administrative support for these operations. The Company is subject to a number of risks similar to those of other companies conducting high-risk, early-stage research and development of product candidates. Principal among these risks are dependence on key individuals and intellectual property, competition from other products and companies, and the technical risks associated with the successful research, development and clinical manufacturing of its product candidates. The Company’s success is dependent upon its ability to continue to raise additional capital in order to fund ongoing research and development, obtain regulatory approval of its products, successfully commercialize its products, generate revenue, meet its obligations, and, ultimately, attain profitable operations. Unaudited Interim Financial Information The accompanying unaudited condensed consolidated financial statements and notes have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and note disclosures normally included in the annual financial statements, prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”), have been condensed or omitted pursuant to those rules and regulations. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the SEC on March 15, 2022. The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair presentation of the Company’s condensed consolidated financial position as of September 30, 2022 and condensed consolidated results of operations for the three and nine months ended September 30, 2022 and 2021 and the condensed consolidated cash flows for the nine months ended September 30, 2022 and 2021, have been made. The Company’s condensed consolidated results of operations for the three and nine months ended September 30, 2022 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2022. Summary of Significant Accounting Policies Revenue Recognition for Contracts with Customers The Company’s revenues are generated primarily through collaborative research, license, development and commercialization agreements. Accounting standards codification (“ASC”) 606, Revenue from Contracts with Customers (“ASC 606”) applies to all contracts with customers, except for contracts that are within the scope of other standards. Under ASC 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company evaluates the performance obligations promised in the contract that are based on goods and services that will be transferred to the customer and determines whether those obligations are both (i) capable of being distinct and (ii) distinct in the context of the contract. Goods or services that meet these criteria are considered distinct performance obligations. If both these criteria are not met, the goods and services are combined into a single performance obligation. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Arrangements that include rights to additional goods or services that are exercisable at a customer’s discretion are generally considered options. The Company assesses if these options provide a material right to the customer and if so, these options are considered performance obligations. The exercise of a material right is accounted for as a contract modification for accounting purposes. The Company recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) each performance obligation is satisfied at a point in time or over time, and if over time this is based on the use of an output or input method. For the nine months ended September 30, 2022 , the Company recorded cumulative catch up adjustments on its contracts with customers that decreased revenue by $ 5.1 million; the cumulative catch-up adjustments resulted from changes in total estimated effort required to satisfy performance obligations. Invoices issued as stipulated in contracts prior to revenue recognition are recorded as deferred revenue. Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue within current liabilities in the accompanying condensed consolidated balance sheets. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as noncurrent deferred revenue. Amounts recognized as revenue, but not yet invoiced are generally recognized as contract assets in the other current assets line item in the accompanying condensed consolidated balance sheets. During the nine months ended September 30, 2022, the Company recorded $ 10.8 million in revenue that was included in deferred revenue as of December 31, 2021. Milestone Payments – If an arrangement includes development and regulatory milestone payments, the Company evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the Company’s or the licensee’s control, such as regulatory approvals, are not considered probable of being achieved until those approvals are received and therefore revenue recognized is constrained as management is unable to assert that a reversal of revenue would not be probable. The transaction price is then allocated to each performance obligation on a relative standalone selling price basis, for which the Company recognizes revenue as or when the performance obligations under the contract are satisfied. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of such development milestones and any related constraint, and, if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect collaboration revenues and earnings in the period of adjustment. Royalties – For arrangements that include sales-based royalties, including milestone payments based on a level of sales, which are the result of a customer-vendor relationship and for which the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation linked to some or all of the royalty has been satisfied or partially satisfied. To date, the Company has not recognized any royalty revenue resulting from any of its licensing arrangements. Significant Financing Component – In determining the transaction price, the Company adjusts consideration for the effects of the time value of money if the timing of payments provides the Company with a significant benefit of financing. The Company does not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the licensees and the transfer of the promised goods or services to the licensees will be one year or less. The Company assessed each of its revenue arrangements in order to determine whether a significant financing component exists and concluded that a significant financing component does not exist in any of its arrangements. Collaborative Arrangements – The Company has entered into collaboration agreements, which are within the scope of ASC 606, to discover, develop, manufacture and commercialize product candidates. The terms of these agreements typically contain multiple promises or obligations, which may include: (1) licenses, or options to obtain licenses, to use the Company’s technology, (2) research and development activities to be performed on behalf of the collaboration partner, and (3) in certain cases, services in connection with the manufacturing of preclinical and clinical material. Payments the Company receives under these arrangements typically include one or more of the following: non-refundable, upfront license fees; option exercise fees; funding of research and/or development efforts; clinical and development, regulatory, and sales milestone payments; and royalties on future product sales. The Company analyzes its collaboration arrangements to assess whether the collaboration agreements are within the scope of ASC 808, Collaborative Arrangements (“ASC 808”) to determine whether such arrangements involve joint operating activities performed by parties that are both active participants in the activities and exposed to significant risks and rewards dependent on the commercial success of such activities. This assessment is performed throughout the life of the arrangement based on changes in the responsibilities of all parties in the arrangement. For collaboration arrangements within the scope of ASC 808 that contain multiple elements, the Company first determines which elements of the collaboration are deemed to be within the scope of ASC 808 and those that are more reflective of a vendor-customer relationship and, therefore, are within the scope of ASC 606. For elements of collaboration arrangements that are accounted for pursuant to ASC 808, an appropriate recognition method is determined and applied consistently, generally by analogy to ASC 606. For those elements of the arrangement that are accounted for pursuant to ASC 606, the Company applies the five-step model described above. For additional discussion of accounting for collaboration revenues, see Note 9, “Collaboration and License Agreements.”

Stockholders' Equity

Stockholders' Equity	9 Months Ended
	Sep. 30, 2022
Stockholders' Equity Note [Abstract]
STOCKHOLDERS' EQUITY	NOTE 2: STOCKHOLDERS’ EQUITY Capital Structure On April 1, 2019, the Company filed an amendment to its amended and restated certificate of incorporation pursuant to which, among other things, the Company increased its authorized shares to 210,000,000 shares of capital stock, of which 200,000,000 shares were designated as $ 0.000005 par value common stock and 10,000,000 shares were designated as $ 0.0001 par value preferred stock.

Share-Based Compensation

Share-Based Compensation	9 Months Ended
	Sep. 30, 2022
Share-Based Payment Arrangement [Abstract]
SHARE-BASED COMPENSATION	NOTE 3: SHARE-BASED COMPENSATION The Company previously granted stock options under its 2006 Stock Incentive Plan (the “2006 Plan”) and its 2015 Stock Incentive Plan (the “2015 Plan”). As of September 30, 2022 there were 1,986,843 stock options outstanding under the 2006 Plan and 2015 Plan and no remaining stock options available to be granted under such plans. On March 12, 2019, the Company’s board of directors adopted, and, on March 14, 2019 the Company’s stockholders approved, the Precision BioSciences, Inc. 2019 Incentive Award Plan (“2019 Plan”) and the 2019 Employee Stock Purchase Plan (“2019 ESPP”), both of which became effective on March 27, 2019. The 2019 Plan provides for the grant of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units and other share-based awards. The number of shares available for issuance under the 2019 Plan initially equaled 4,750,000 shares of common stock. The 2019 Plan provides for an annual increase to the number of shares of common stock available for issuance on the first day of each calendar year beginning January 1, 2020 and ending on and including January 1, 2029 by an amount equal to the lesser of (i) 4 % of the aggregate number of shares of common stock outstanding on the final day of the immediately preceding calendar year and (ii) such smaller number of shares of common stock as determined by the board of directors. As of September 30, 2022 , the aggregate number of shares available for issuance under the 2019 Plan has been increased by 6,589,999 pursuant to this provision. Any shares that are subject to awards outstanding under the Company’s 2006 Plan and 2015 Plan as of the effective date of the 2019 Plan that expire, lapse, or are terminated, exchanged for cash, surrendered, repurchased, or canceled without having been fully exercised or forfeited, to the extent so unused, will become available for award grants under the 2019 Plan. As of September 30, 2022 , 1,435,635 shares were available to be issued under the 2019 Plan. The 2019 Plan had 9,070,937 stock options and 1,936,252 restricted stock units (“RSUs”) outstanding as of September 30, 2022. Up to 525,000 shares of the Company’s common stock were initially reserved for issuance under the 2019 ESPP. The 2019 ESPP provides for an annual increase to the number of shares available for issuance on the first day of each calendar year beginning January 1, 2020 and ending on and including January 1, 2029 by an amount equal to the lesser of (i) 1 % of the shares outstanding on the final day of the immediately preceding calendar year and (ii) such smaller number of shares as is determined by our board of directors. As of September 30, 2022 , the aggregate number of shares available for issuance under the 2019 ESPP has been increased by 1,647,499 shares pursuant to this provision. The purchase price of the shares under the 2019 ESPP, in the absence of a contrary designation, will be 85 % of the lower of the fair market value of our common stock on the first trading day of the offering period or on the purchase date. As of September 30, 2022 , the Company had issued 447,787 shares under the 2019 ESPP. As of September 30, 2022 , 1,724,712 shares were available to be issued under the 2019 ESPP. The Company recognized share-based compensation expense related to the ESPP o f $ 0.1 million and $ 0.3 million during the nine months ended September 30, 2022 and 2021, respectively. On August 9, 2021, the Company’s board of directors approved the adoption of the Precision BioSciences, Inc. 2021 Employment Inducement Incentive Award Plan (as amended, the “Inducement Award Plan”). The Inducement Award Plan provides for the grant of non-qualified stock options, stock appreciation rights, restricted stock, RSUs and other share-based awards to newly hired employees who have not previously been an employee or member of the board, or an employee who is being rehired following a bona fide period of non-employment by the Company. No more than 9,000,000 shares of the Company’s common stock may be issued under the Inducement Award Plan. As of September 30, 2022 , 6,024,715 shares were available to be issued under the Inducement Award Plan. The Inducement Award Plan had 2,751,623 stock options and 223,662 RSUs outstanding as of September 30, 2022. The Company recorded employee and nonemployee share-based compensation expense as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Employee $ 4,215 $ 4,151 $ 11,977 $ 10,942 Nonemployee 918 400 2,684 1,137 $ 5,133 $ 4,551 $ 14,661 $ 12,079 Share-based compensation expense is included in the following line items in the condensed consolidated statements of operations (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Research and development $ 2,069 $ 2,563 $ 6,227 $ 6,916 General and administrative 3,064 1,988 8,434 5,163 $ 5,133 $ 4,551 $ 14,661 $ 12,079 Determining the appropriate fair value model to measure the fair value of the stock option grants on the date of grant and the related assumptions requires judgment. The fair value of each stock option grant is estimated using a Black-Scholes option-pricing model on the date of grant as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2022 Estimated dividend yield 0.00 % 0.00 % Weighted-average expected stock price volatility 80.34 % 79.25 % Weighted-average risk-free interest rate 3.11 % 2.42 % Expected term of options (in years) 6.06 6.08 Weighted-average fair value per option $ 1.09 $ 1.94 The expected volatility rates are estimated based on the actual volatility of a peer group comprising the Company and other comparable public companies over the expected term. The expected term represents the average time that stock options are expected to be outstanding. The Company does not have sufficient history of exercising stock options to estimate the expected term of employee stock options and thus utilizes a weighted value considering actual history and estimated expected term based on the midpoint of final vest date and expiration date. The risk-free rate is based on the United States Treasury yield curve at the time of grant for the expected term of the option. The following table summarizes activity in the Company’s stock option plans for the nine months ended September 30, 2022: Outstanding Option Shares Weighted-Average Exercise Price Balance as of January 1, 2022 9,920,314 $ 9.28 Granted 6,191,412 2.80 Exercised ( 330,359 ) 1.17 Forfeited/canceled ( 1,971,964 ) 9.65 Balance as of September 30, 2022 13,809,403 $ 6.52 The intrinsic value of stock options exercised was $ 0.7 million and $ 14.9 million during the nine months ended September 30, 2022 and 2021, respectively. During the nine months ended September 30, 2022 , the Company granted 1,826,307 RSUs with a grant date fair value of $ 6.6 million. The fair value of each award was determined based on the closing market price of the Company’s common stock on the date of grant. The fair value of the RSUs will be recognized as expense over the requisite vesting period. The following table summarizes the Company’s RSU activity for the nine months ended September 30, 2022: RSU Awards Weighted-Average Grant Date Fair Value Unvested RSUs as of January 1, 2022 773,503 11.29 Granted 1,826,307 $ 3.64 Forfeited ( 175,781 ) 7.19 Vested ( 264,115 ) 11.34 Unvested RSUs as of September 30, 2022 2,159,914 $ 5.15 There was approximately $ 34.7 million of total unrecognized compensation cost related to unvested stock options and RSUs as of September 30, 2022 , which is expected to be recognized over a weighted-average period of 2.5 years.

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2022
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	NOTE 4: COMMITMENTS AND CONTINGENCIES Litigation The Company is subject to various legal matters and claims in the ordinary course of business. Although the results of legal proceedings and claims cannot be predicted with certainty, in the opinion of management, there are currently no such known matters that will have a material effect on the consolidated financial condition, results of operations or cash flows of the Company. COVID-19 Pandemic In March 2020, the World Health Organization designated the outbreak of the novel strain of coronavirus known as COVID-19 as a global pandemic. The Company has taken steps in line with guidance from the U.S. Centers for Disease Control and Prevention and the State of North Carolina to protect the health and safety of its employees and the community. The Company is working closely with its clinical sites, physician partners and the patient community to monitor and manage the ongoing impact of the COVID-19 pandemic and variants thereof. The Company remains committed to its clinical programs and development plans, however, disruptions, competing resource demands and safety concerns caused by the COVID-19 pandemic and variants thereof have caused, and are likely to continue to cause, delays in the Company’s clinical trial site activation and impacted its ability to enroll patients. The Company may also experience other difficulties, disruptions or delays in conducting preclinical studies, initiating, enrolling, conducting or completing its planned and ongoing clinical trials or supply chain disruptions, and the Company may incur other unforeseen costs as a result. While the extent to which the COVID-19 pandemic and variants thereof may continue to impact the Company’s future results will depend on future developments, the pandemic and associated economic impacts, including sustained inflation, supply chain disruptions and major central bank policy actions, which could result in a material impact to the Company’s future financial condition, results of operations and cash flows. Future economic impacts associated with the COVID-19 pandemic and variants thereof such as sustained inflation, supply chain disruptions and major central bank policy actions may have a negative impact on our preclinical studies and clinical trials. Servier Program Purchase Agreement On April 9, 2021, the Company entered into a program purchase agreement with Les Laboratoires Servier and Institut de Recherches Internationales Servier (collectively, “Servier”), pursuant to which the Company reacquired all of its global development and commercialization rights previously granted to Servier pursuant to the Development and Commercial License Agreement by and between Servier and the Company, dated February 24, 2016, as amended (the “Servier Agreement”), and mutually terminated the Servier Agreement (the “Program Purchase Agreement”). The Program Purchase Agreement requires the Company to make certain payments to Servier based on the achievement of regulatory and commercial milestones for each product, and a low- to mid-single-digit percentage royalty (subject to certain reductions) based on net sales of approved products, if any, resulting from any continued development and commercialization of the programs by the Company, for a period not to exceed ten years after first commercial sale of the applicable product in the United States or certain countries in Europe. If the Company enters into specified product partnering transactions, the Program Purchase Agreement requires the Company to pay to Servier a portion of certain consideration received pursuant to such product partnering transactions in lieu of the foregoing milestones (with the exception of a one-time clinical phase development milestone) and royalties. Regulatory and Commercial Milestones Management assessed the likelihood of each of the regulatory and commercial milestones included in the Program Purchase Agreement in accordance with ASC 450, Contingencies (“ASC 450”). If the assessment of a contingency indicates that it is probable that the milestone will be achieved and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s condensed consolidated financial statements. Accordingly, a $ 10.0 million financial contract liability was accrued in the nine months ended September 30, 2021 and is included in the condensed consolidated balance sheets as of September 30, 2022 and December 31, 2021. Product Partnering Transaction Consideration Due to Servier Per the terms of the Program Purchase Agreement, should the Company enter into a product partnering transaction with respect to any of the targets previously nominated by Servier, the Company will pay Servier a percentage of the proceeds received. In accordance with ASC 450 management concluded that the amount of proceeds due to Servier as a result of a future product partnering transaction, if any, cannot be reasonably estimated as of the date of this Quarterly Report on Form 10-Q. As such, no contingency for this provision was included in the condensed consolidated financial statements as of September 30, 2022 or December 31, 2021. Leases The Company has operating leases for real estate in North Carolina and does not have any finance leases. Many of the Company’s leases contain options to renew and extend lease terms and options to terminate leases early. Reflected in the right-of-use asset and lease liabilities on the Company’s condensed consolidated balance sheet are the periods provided by renewal and extension options that the Company is reasonably certain to exercise, as well as the periods provided by termination options that the Company is reasonably certain to not exercise. The Company has existing leases that include variable lease payments that are not included in the right-of-use asset and lease liabilities and are reflected as an expense in the period incurred. Such payments primarily include common area maintenance charges. These variable lease payments are paid separately from rent based on actual costs incurred and therefore are not included in the right-of-use assets and lease liabilities but rather reflected as an expense in the period incurred. Future lease payments under non-cancelable operating leases with terms of greater than one year as of September 30, 2022, were as follows: (in thousands) September 30, 2022 2022 (excluding the nine months ended September 30, 2022) $ 569 2023 2,323 2024 1,594 2025 529 2026 545 2027 and beyond 372 Total lease payments 5,932 Less: imputed interest 646 Total operating lease liabilities $ 5,286 Supply Agreements The Company enters into contracts in the normal course of business with contract manufacturing organizations (“CMOs”) for the manufacture of clinical trial materials and contract research organizations (“CROs”) for clinical trial services. These agreements provide for termination at the request of either party with less than one-year notice and are, therefore, cancelable contracts and, if canceled, are not anticipated to have a material effect on the condensed consolidated financial condition, results of operations, or cash flows of the Company.

Debt

Debt	9 Months Ended
	Sep. 30, 2022
Debt Disclosure [Abstract]
DEBT	NOTE 5: DEBT Elo Loan In May 2021, the Company's then wholly owned subsidiary, Elo Life Systems, Inc., entered into a loan and security agreement with Pacific Western Bank (“PWB”) for a term loan (the “Elo Loan”) in the amount of $ 2.5 million. On December 14, 2021, the Company repaid all outstanding principal and interest on the Elo Loan with proceeds from the Revolving Line (defined below). Revolving Line Pursuant to the terms of the loan and security agreement with PWB (as amended from time to time, the “Revolving Line”) the Company may request advances on a revolving line of credit of up to an aggregate principal of $ 30.0 million. In May 2022, the Company and PWB executed the Seventh Amendment to the Revolving Line (the “Revolving Line Amendment”). Upon the execution of the Revolving Line Amendment, the interest rate on credit advances was modified to the greater of (a) 0.75 % above the Prime rate (as defined in the Revolving Line) and (b) 4.25 %. In July 2022, the maturity date of the Revolving Line was extended to June 23, 2024 upon the Company’s receipt of $ 100.0 million in aggregate new gross proceeds (as defined in the Revolving Line Amendment). All outstanding principal amounts under the Revolving Line are due on the maturity date. The Company must also maintain an aggregate balance of unrestricted cash at PWB (not including amounts in certain specified accounts) equal to or greater than $ 10.0 million. In December 2021, the Company borrowed $ 2.5 million under the Revolving Line to pay all outstanding principal on the Elo Loan. In May 2022, the Company borrowed an additional $ 20.0 million under the Revolving Line. As of September 30, 2022 , $ 22.5 million was outstanding under the Revolving Line and the unamortized Revolving Line debt discount balance was $ 0.3 million. As of September 30, 2022 , the stated interest rate on the Revolving Line was 7.00 % and the effective interest rate was 8.00 %.

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2022
Income Tax Disclosure [Abstract]
INCOME TAXES	NOTE 6: Income Taxes The Company estimates an annual effective tax rate of 0 % for the year ending December 31, 2022 as the Company incurred losses for the nine months ended September 30, 2022 and expects to continue to incur losses through the remainder of fiscal year ending December 31, 2022, resulting in an estimated net loss for both financial statement and tax purposes for the year ending December 31, 2022. Therefore, no federal or state income taxes are expected and none have been recorded at this time. Income taxes have been accounted for using the liability method. Due to the Company's history of losses since inception, there is not enough evidence at this time to support that the Company will generate future income of a sufficient amount and nature to utilize the benefits of its net deferred tax assets. Accordingly, the deferred tax assets have been reduced by a full valuation allowance, since the Company does not currently believe that realization of its deferred tax assets is more likely than not. As of September 30, 2022 , the Company had no uncertain tax positions that required the establishment of a reserve.

Fair Value Measurements

Fair Value Measurements	9 Months Ended
	Sep. 30, 2022
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract]
FAIR VALUE MEASUREMENTS	NOTE 7: FAIR VALUE MEASUREMENTS The carrying amounts of the Company’s accounts receivable, accounts payable, and accrued expenses and other current liabilities, approximate their respective fair values due to their short-term nature. The Company uses a three-tier fair value hierarchy to classify and disclose all assets and liabilities measured at fair value on a recurring basis and to minimize the use of unobservable inputs when determining their fair value. The three tiers are defined as follows: Level 1—Observable inputs based on unadjusted quoted prices in active markets for identical assets or liabilities Level 2—Inputs, other than quoted prices in active markets, that are observable either directly or indirectly Level 3—Unobservable inputs for which there is little or no market data, which require the Company to develop its own assumptions Cash Equivalents As of September 30, 2022 the Company held cash equivalents which are composed of money market funds and repurchase agreements that were purchased through repurchase intermediary banks and collateralized by deposits in the form of government securities and obligations. As of December 31, 2021, the Company held an insignificant amount of cash equivalents which were composed of investments in money market funds. The Company classifies investments in money market funds within Level 1 of the fair value hierarchy as the prices are available from quoted prices in active markets. Investments in repurchase agreements are classified within Level 2 of the fair value hierarchy as these instruments are valued using observable market inputs including reported trades, broker/dealer quotes, bids and/or offers. Investment in iECURE In August 2021, the Company entered into an Equity Issuance Agreement with iECURE, Inc. (“iECURE”), pursuant to which iECURE granted the Company partial equity ownership in iECURE (the “iECURE equity”) as partial consideration for a license to use the Company’s PCSK9-directed ARCUS nuclease to insert genes into the PCSK9 locus to develop treatments for four pre-specified rare genetic diseases (the “PCSK9 license”). On issuance, the Company accounted for the iECURE equity at fair value under ASC 825, Financial Instruments (“ASC 825”). Accordingly, the Company adjusts the carrying value of the iECURE equity to fair value each reporting period with any changes in fair value recorded to other income (expense). There were no assessed changes in the fair value of the iECURE equity during the nine months ended September 30, 2022. The Company classifies the iECURE equity within Level 3 of the fair value hierarchy as the assessed fair value was based on significant unobservable inputs given iECURE equity is not traded on a public exchange. For additional discussion of accounting for the iECURE Development and License agreement (as defined below) and the iECURE Equity Issuance Agreement (as defined below), refer to Note 9, “Collaboration and License Agreements.” Final Payment Fee The Company is required to pay a final payment fee upon maturity of the Revolving Line. The final payment fee was determined to be a derivative under ASC 815, therefore these fees were initially measured at fair value and recorded as debt discount to be amortized to interest expense over the term of the Revolving Line. Accordingly, the Company will adjust the carrying value of the final payment fee to fair value each reporting period with any changes in fair value recorded to other income (expense). There was no assessed change in the fair value of the final payment fee during the nine months ended September 30, 2022. The Company classifies the final payment fee within Level 2 of the fair value hierarchy as the assessed fair value was based on observable market inputs including the Company’s current borrowing rate on the Revolving Line. The final payment fee is included in the other noncurrent liabilities within the condensed consolidated balance sheet as of September 30, 2022. The following represents assets and liabilities measured at fair value on a recurring basis by the Company (in thousands): September 30, 2022 Fair Value Level 1 Level 2 Level 3 Assets: Money market funds $ 522 $ 522 $ — $ — Repurchase agreements 40,000 — 40,000 — Investment in iECURE 3,091 — — 3,091 $ 43,613 $ 522 $ 40,000 $ 3,091 Liabilities Final payment fee $ 204 $ — $ 204 $ — $ 204 $ — $ 204 $ — December 31, 2021 Fair Value Level 1 Level 2 Level 3 Assets: Money market funds $ 12 $ 12 $ — $ — Investment in iECURE 3,091 — — 3,091 $ 3,103 $ 12 $ — $ 3,091

Elo Transaction

Elo Transaction	9 Months Ended
	Sep. 30, 2022
Deconsolidation Of Subsidiary [Abstract]
Elo Transaction	NOTE 8: Elo Transaction On December 17, 2021, the Company and its then wholly owned subsidiary, Elo Life Systems, Inc., entered into an agreement with a syndicate of investors, pursuant to which the Company contributed substantially all of the assets of Elo Life Systems, Inc. to a newly formed entity (the “Elo Transaction”). In connection with the Elo Transaction, the Company granted the newly formed entity ("New Elo") an exclusive license to certain of the Company’s intellectual property for use in non-medical applications with respect to plants, farm animals and certain other organisms. In addition, all of the Company’s employees in its Food segment, including its management, became employees of New Elo. Investment in New Elo As partial consideration for the assets contributed and license granted by the Company to New Elo, the Company received Common Stock in New Elo. It was determined that the noncontrolling shareholders of New Elo have substantive rights to participate in the financial and operating decisions of New Elo. As such, it was determined that the Company does not possess control over New Elo or have significant decision-making authority. Accordingly, New Elo is not consolidated in the Company’s financial statements. However, as the Company owns approximately 55 % of the voting shares in New Elo, it was determined that the Company possesses the ability to exercise significant influence over the operating and financial policies of New Elo. As such, the Company accounts for its investment in New Elo under the equity method. The Company’s proportionate share of New Elo’s net loss for the three and nine months ended September 30, 2022 was $ 1.8 million and $ 4.2 million, respectively. As the Company's cumulative proportionate share of New Elo's net loss exceeded the initial carrying value of the Investment in New Elo, the carrying value of the Investment in New Elo was reduced to $ 0 as of September 30, 2022. In accordance with ASC 323, the Company will continue to record its proportionate share of New Elo's net loss in the condensed consolidated statement of operations along with a corresponding reduction in the carrying value of the Note Receivable (defined below). Note Receivable As partial consideration for the assets contributed and license granted by the Company to New Elo, the Company received a $ 10.0 million promissory note payable from New Elo (the “Note Receivable”). The Note Receivable matures on the earlier of (i) December 1, 2028 or (ii) a Deemed Liquidation Event (as defined in the New Elo’s Amended and Restated Certificate of Incorporation). The Note accrues interest at 2.00 % per annum, and is payable annually on December 17th. As of September 30, 2022, the carrying value of the Note Receivable was $ 6.7 million including a $ 0.4 million decrease in the carrying value as a result of equity method investment losses. The $ 3.3 million discount on the Note Receivable will be amortized to interest income over the life of the Note.

Collaboration and License Agree

Collaboration and License Agreements	9 Months Ended
	Sep. 30, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
COLLABORATION AND LICENSE AGREEMENTS	NOTE 9: COLLABORATION AND LICENSE AGREEMENTS Collaboration and License Agreement with Novartis On June 14, 2022, the Company entered into a collaboration and license agreement (the “Novartis Agreement”) with Novartis Pharma AG ( “Novartis”), which became effective on June 15, 2022 (the “Novartis Effective Date”), to collaborate to discover and develop in vivo gene editing products incorporating our custom ARCUS nucleases for the purpose of seeking to research and develop potential treatments for certain diseases (as defined in the Novartis Agreement, the “Licensed Products”). Any initial Licensed Products will be developed for the potential treatment of certain hemoglobinopathies, including sickle cell disease and beta thalassemia. Pursuant to the terms of the Novartis Agreement, the Company will develop an ARCUS nuclease and conduct in vitro characterization for the Licensed Products, with Novartis then assuming responsibility for all subsequent development, manufacturing and commercialization activities. Novartis will receive an exclusive license for, and be required to use commercially reasonable efforts to conduct all subsequent research, development, manufacture and commercialization activities with respect to the Licensed Products. The Company will initially develop a single, custom ARCUS nuclease for a defined “safe harbor” target site for insertion of specified therapeutic payloads in the patient’s genome (the “Initial Nuclease”) for Novartis to further develop as a potential in vivo treatment option for certain hemoglobinopathies, including sickle cell disease and beta thalassemia. Pursuant to the terms of the Novartis Agreement, Novartis may elect, subject to payment of a fee to the Company, to replace Licensed Products based on the Initial Nuclease with Licensed Products based on a second custom ARCUS nuclease the Company designs for gene editing of a specified human gene target associated with hemoglobinopathies (the “Replacement Nuclease”). Additionally, Novartis has the option, upon payment of a fee to the Company for each exercise of the option, to include Licensed Products utilizing the Initial Nuclease for insertion of up to three additional specified therapeutic payloads at the “safe harbor” target site, each intended to treat a particular genetic disease. The exercise period for such option ends on the earlier of (a) the fourth anniversary of the Novartis Effective Date and (b) the replacement of the Initial Nuclease with the Replacement Nuclease as described above. In July 2022, the Company received a $ 50.0 million upfront cash payment under the Novartis Agreement. Additionally, on the Novartis Effective Date Novartis made an equity investment of $ 25.0 million in the Company’s common stock pursuant to a stock purchase agreement (the “Novartis Stock Purchase Agreement”) pursuant to which, on the Novartis Effective Date, the Company issued and sold to Novartis 12,407,440 shares of the Company’s common stock (the “Novartis Shares”) in a private placement transaction for an aggregate purchase price of $ 25.0 million, or approximately $ 2.01 per share. The price per share of the Company’s common stock under the Novartis Stock Purchase Agreement represented a 20 % premium over the volume-weighted-average-price of the Company’s common stock over the 10 trading days preceding the execution date of the Novartis Stock Purchase Agreement. Management concluded that the Novartis Stock Purchase Agreement was to be combined with the Novartis Agreement for accounting purposes. Of the total $ 75.0 million upfront compensation, the Company applied equity accounting guidance to measure the $ 11.6 million recorded in equity upon the issuance of the shares, and $ 63.4 million was identified as transaction price allocated to the revenue arrangement. Pursuant to the Novartis Stock Purchase Agreement, subject to certain exceptions, Novartis may not sell the Novartis Shares without the Company’s approval for a period of two years following the Novartis Effective Date. In addition, for a period of two years following the Novartis Effective Date, Novartis and its affiliates may not (a) effect or otherwise participate in, directly or indirectly, any acquisition of any of our securities or material assets, any tender offer or exchange offer, merger or other business combination or change of control involving the Company, any recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction with respect to the Company, or any solicitation of proxies or consents to vote any of the Company’s securities or (b) act with any other person, or publicly disclose any intention, to do any of the foregoing. The Novartis Stock Purchase Agreement also contains customary representations, warranties, and covenants of both parties. On the Novartis Effective Date, the Company and Novartis also entered into a registration rights agreement (the “Registration Rights Agreement”) pursuant to which the Company has agreed, within the time periods specified in the Registration Rights Agreement, to register the resale of the Novartis Shares on a registration statement to be filed with the SEC. The Registration Rights Agreement contains customary indemnification provisions, and all registration rights terminate in their entirety effective on the first date on which there cease to be any Registrable Securities (as defined in the Registration Rights Agreement) outstanding. The Company will also be eligible to receive milestone payments of up to an aggregate of approximately $ 1.4 billion as well as certain research funding. If Licensed Products resulting from the collaboration are approved and sold, the Company will also be entitled to receive tiered royalties ranging from the mid-single digit to low-double digit percentages on net sales of Licensed Products, subject to customary potential reductions. Novartis’s obligation to pay royalties to us expires on a country-by-country and Licensed Product-by-Licensed Product basis, upon the latest to occur of certain events related to expiration of patents, regulatory exclusivity or a period of ten years following the first commercial sale of the Licensed Product. Unless earlier terminated, the Novartis Agreement will remain in effect on a Licensed Product-by-Licensed Product and country-by-country basis until the expiration of a defined royalty term for each Licensed Product and country. Novartis has the right to terminate the Novartis Agreement without cause by providing advance notice to the Company. Either party may terminate the Novartis Agreement for material breach by the other party and a failure to cure such breach within the time period specified in the Novartis Agreement. The Company may also terminate the Novartis Agreement in the event that Novartis brings a challenge to our patents. The Company assessed the Novartis Agreement in accordance with ASC 606 and concluded that the promises in the agreement represent transactions with a customer. The Company has determined that the promises associated with the research and development activities for each of the targets are not distinct because they are all based on the ARCUS proprietary genome editing platform. The Company has concluded that the agreement with Novartis contains the following promises: (i) license of intellectual property; (ii) performance of research and development (“R&D”) services, and (iii) Joint Steering Committee (“JSC”) participation. The Company determined that the license of intellectual property and R&D services were not distinct from each other, as the license and R&D services are highly interdependent upon one another. The JSC participation was determined to be an immaterial promise as the time commitment and related cost associated with performance of JSC participation is expected to be inconsequential to the total consideration in the contract. As such, the Company determined that these promises should be combined into a single performance obligation. The Company recognizes revenue from the $ 50.0 million upfront cash payment, $ 13.4 million allocated to the transaction price from the Novartis Stock Purchase Agreement, and variable consideration on an input method in the form of research effort relative to expected research effort at the completion of the performance obligation, which is based on the actual hours of research work performed relative to expected hours of research work to be incurred in the future to satisfy the performance obligation. Management will evaluate and adjust the total expected research effort for the performance obligation on a quarterly basis based upon actual research hours incurred to date relative to research hour forecasts. The transfer of control occurs over this time period and, in management’s judgment, is the best measure of progress towards satisfying the performance obligation. During the three and nine months ended September 30, 2022 the Company recognized revenue under the Novartis Agreement of $ 3.6 million. Deferred revenue related to the Novartis Agreement amounted to $ 60.0 million as of September 30, 2022, of which $ 30.1 million, was included in current liabilities within the condensed consolidated balance sheets. Development and License Agreement with Eli Lilly On November 19, 2020, the Company, entered into a development and license agreement, subsequently amended by the First Amendment to the Development and License Agreement dated August 9, 2021 (as amended, the “Lilly Agreement”) with Eli Lilly and Company (“Lilly”) to collaborate to discover and develop in vivo gene editing products incorporating the Company’s ARCUS nucleases. Lilly has initially nominated Duchenne muscular dystrophy, a liver-directed target and a central nervous system directed target. Under the terms of the Development and License Agreement, Lilly has the right to nominate up to three additional gene targets for genetic disorders over the initial nomination period of four years. Lilly may extend the nomination period for an additional two years from the date on which such initial Nomination Period ends, upon Lilly’s election and payment of an extension fee. Additionally, under the terms of the Lilly Agreement, Lilly has the option to replace up to two gene targets upon Lilly’s election and payment of a replacement target fee. Under the terms of the Lilly Agreement, Lilly will receive an exclusive license to research, develop, manufacture and commercialize the resulting licensed products to diagnose, prevent and treat any and all diseases by in vivo gene editing directed against the applicable gene target. The Lilly Agreement provides that the Company will be responsible for conducting certain pre-clinical research and investigational new drug application (“IND”) enabling activities with respect to the gene targets nominated by Lilly to be subject to the collaboration, including manufacture of initial clinical trial material for the first licensed product. Lilly will be responsible for, and must use commercially reasonable efforts with respect to, conducting clinical development and commercialization activities for licensed products resulting from the collaboration, and may engage the Company for additional clinical and/or initial commercial manufacture of licensed products. Upon closing of the Lilly Agreement on January 6, 2021, the Company received an upfront cash payment of $ 100.0 million. The Company will also be eligible to receive milestone payments of up to an aggregate of $ 420.0 million per licensed product as well as nomination fees for additional targets and certain research funding. If licensed products resulting from the collaboration are approved and sold, the Company will also be entitled to receive tiered royalties ranging from the mid-single digit percentages to the low-teens percentages on world-wide net sales of the licensed products, subject to customary potential reductions. Lilly’s obligation to pay royalties to the Company expires on a country-by-country and licensed product-by-licensed product basis, upon the latest to occur of certain events related to expiration of patents, regulatory exclusivity or a period of ten years following first commercial sale of the licensed product. Simultaneously with the entry into the Lilly Agreement, the Company and Lilly entered into a Share Purchase Agreement (the “Lilly Share Purchase Agreement”), pursuant to which Lilly purchased 3,762,190 shares of the Company’s common stock for a purchase price of $ 35.0 million. Management concluded that the Lilly Share Purchase Agreement was to be combined with the Lilly Agreement for accounting purposes. Of the total $ 135.0 million upfront compensation, the Company applied equity accounting guidance to measure the $ 27.7 million recorded in equity upon the issuance of the shares, and $ 107.3 million was identified as the transaction price allocated to the revenue arrangement. The Company assessed this arrangement in accordance with ASC 606 and concluded that the promises in the agreement represent transactions with a customer. The Company has determined that the promises associated with the research and development activities for each of the targets are not distinct because they are all based on the ARCUS proprietary genome editing platform. The Company has concluded that the agreement with Lilly contains the following promises: (i) license of intellectual property; (ii) performance of R&D services, (iii) the manufacture of pre-clinical supply, (iv) Joint Steering Committee (“JSC”) Participation, and (v) regulatory responsibilities. The Company determined that the license of intellectual property, R&D services, manufacture of pre-clinical development material, and regulatory responsibilities were not distinct from each other, as the license, R&D services, pre-clinical supply, and regulatory responsibilities are highly interdependent upon one another. The JSC participation was determined to be an immaterial promise as the time commitment and related cost associated with performance of JSC participation is expected to be inconsequential to the total consideration in the contract. As such, the Company determined that these promises should be combined into a single performance obligation. The Company recognizes revenue from the $ 100.0 million upfront cash payment, $ 7.3 million allocated to the transaction price from the Lilly Share Purchase Agreement, and variable consideration on an input method in the form of research effort relative to expected research effort at the completion of the performance obligation, which is based on the actual time of R&D activities performed relative to expected time to be incurred in the future to satisfy the performance obligation. Management evaluates and adjusts the total expected research effort for the performance obligation on a quarterly basis based upon actual research progress to date relative to research progress forecasts. The transfer of control occurs over this time period and, in management’s judgment, is the best measure of progress towards satisfying the performance obligation. During the three months ended September 30, 2022 and 2021, the Company recognized revenue under the Lilly Agreement of $ 3.8 million and $ 4.9 million, respectively. During the nine months ended September 30, 2022 and 2021, the Company recognized revenue under the Lilly Agreement of approximately $ 10.9 million and $ 15.6 million, respectively. Deferred revenue related to the Lilly Agreement amounted to $ 78.9 million and $ 88.3 million as of September 30, 2022 and December 31, 2021, respectively, of which $ 18.3 million and $ 21.2 million, respectively, was included in current liabilities within the condensed consolidated balance sheets. Development and License Agreement with iECURE In August 2021, the Company entered into a development and license agreement with iECURE (the “iECURE Development and License Agreement”) under which iECURE is expected to advance the Company’s PBGENE-PCSK9 candidate through Phase 1 studies and gain access to Precision’s PCSK9-directed ARCUS nuclease to develop four other pre-specified rare gene editing therapies for genetic diseases (the “iECURE Agreement”). Pursuant to the iECURE Agreement, the Company retains the rights to PBGENE-PCSK9, including all products developed for genetic indications with increased risk of severe cardiovascular events such as Familial Hypercholesterolemia (“FH”). In return, the Company granted iECURE a license to use its PCSK9-directed ARCUS nuclease to insert genes into the PCSK9 locus to develop treatments for four other pre-specified rare genetic diseases, including ornithine transcarbamylase (“OTC”) deficiency, Citrullinemia Type 1 (“CTLN1”), phenylketonuria (“PKU”), and another program focused on liver disease. Simultaneously with the entry into the iECURE Agreement, the Company and iECURE entered into an Equity Issuance Agreement (the “iECURE Equity Issuance Agreement”), pursuant to which iECURE granted the Company partial equity ownership in iECURE as partial consideration for the PCSK9 license. Management concluded that the iECURE Equity Issuance Agreement was to be combined with the iECURE Development and License Agreement (together, the “iECURE Agreements”) for accounting purposes. Additionally, the Company is eligible to receive milestone and mid-single digit to low double digit royalty payments on sales of iECURE products developed with ARCUS. The fair value of the iECURE equity at inception of the iECURE agreements was assessed to be $ 0.5 million and was initially recorded to the investment in equity securities line item of the condensed consolidated balance sheets. As further discussed in Note 7, “Fair Value Measurements,” on issuance, Management elected to account for the iECURE equity at fair value under ASC 825. Accordingly, the Company adjusts the carrying value of the iECURE equity to fair value each reporting period with any changes in fair value recorded to other income (expense). There were no assessed changes in the fair value of the iECURE equity during the nine months ended September 30, 2022 . The fair value of the costs to be incurred by iECURE to progress the Company’s PBGENE-PCSK9 candidate through Phase 1 studies (the “PCSK9 Prepaid”) was assessed to be $ 17.4 million and was recorded to the prepaid expenses and other assets line items of the condensed consolidated balance sheets. The PCSK9 Prepaid will be amortized to research and development expense on a pro-rata basis as iECURE incurs costs to progress the PBGENE-PCSK9 candidate through Phase 1 studies. During the nine months ended September 30, 2022, the Company recognized $ 1.7 million of research and development expense related to amortization of the PCSK9 Prepaid. As of September 30, 2022, the remaining balance of the PCSK9 prepaid was $ 11.2 million, which was included in the prepaid expenses and other assets line items of the condensed consolidated balance sheets in the amounts of $ 4.2 million and $ 7.0 million, respectively. Development and Commercial License Agreement with Servier The Company has developed certain allogeneic CAR T candidates, including PBCAR0191 and the stealth cell PBCAR19B, each targeting CD19, as well as four additional product targets under the Servier Agreement. Pursuant to the terms of the Program Purchase Agreement, the Company regained full global rights to research, develop, manufacture and commercialize products resulting from such programs, with sole control over all activities. Additionally, per the terms of the Program Purchase Agreement the Company does not have an obligation to continue development of the Servier Targets. With respect to products directed to CD19, Servier has certain rights of negotiation, which may be exercised during a specified time period if the Company elects to initiate a process or entertain third party offers for partnering such products. Pursuant to the terms of the Program Purchase Agreement, the Company made a payment of $ 1.25 million in cash to Servier and agreed to waive earned milestones totaling $ 18.75 million that would have been otherwise payable to the Company. The Program Purchase Agreement also requires the Company to make certain payments to Servier based on the achievement of regulatory and commercial milestones for each product, and a low- to mid-single-digit percentage royalty (subject to certain reductions) based on net sales of approved products, if any, resulting from any continued development and commercialization of the programs by the Company, for a period not to exceed ten years after first commercial sale of the applicable product in the United States or certain countries in Europe. If the Company enters into specified product partnering transactions, the Program Purchase Agreement requires the Company to pay to Servier a portion of certain consideration received pursuant to such product partnering transactions in lieu of the foregoing milestones (with the exception of a one-time clinical phase development milestone) and royalties. For additional discussion of accounting for payment obligations arising from the Program Purchase Agreement, refer to Note 4, “Commitments and Contingencies.” The Company did no t recognize any revenue under the Servier Agreement during the nine months ended September 30, 2022 . During the nine months ended September 30, 2021, the Company recognized revenue under the Servier Agreement of approximately $ 72.9 million. The Company did no t have deferred revenue related to the Servier Agreement as of September 30, 2022 or December 31, 2021.

Net Loss Per Share

Net Loss Per Share	9 Months Ended
	Sep. 30, 2022
Earnings Per Share [Abstract]
NET LOSS PER SHARE	NOTE 10: NET LOSS PER SHARE The Company calculates basic net loss per share by dividing net loss for each respective period by the weighted average number of common shares outstanding for each respective period. The Company computes diluted net loss per share after giving consideration to the dilutive effect of unvested RSUs, stock options and unsettled ESPP contributions that are outstanding during the period, except where such securities would be anti-dilutive. The Company’s diluted net loss per share is the same as basic net loss per share for the three and nine months ended September 30, 2022 and 2021 given all potential shares of common stock are anti-dilutive as a result of the net loss for all reporting periods. The computations of basic and diluted net loss per share attributable to common stockholders are as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Net loss (in thousands) $ ( 23,946 ) $ ( 11,279 ) $ ( 83,149 ) $ ( 8,312 ) Weighted average common shares outstanding basic and diluted 110,849,196 59,657,677 80,127,701 58,018,550 Net loss per share, basic and diluted $ ( 0.22 ) $ ( 0.19 ) $ ( 1.04 ) $ ( 0.14 ) The following weighted-average common stock equivalents were excluded from the calculation of diluted net loss per share because their inclusion would have been anti-dilutive: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Unvested Restricted Stock Units 2,192,105 808,758 1,898,925 342,044 Stock Options 1,406,185 6,448,353 2,024,854 5,760,008 Unsettled ESPP Contributions 14,880 2,488 4,960 829 Total common stock equivalents excluded from diluted net loss per share 3,613,170 7,259,599 3,928,739 6,102,881

Segment Reporting

Segment Reporting	9 Months Ended
	Sep. 30, 2022
Segment Reporting [Abstract]
SEGMENT REPORTING	NOTE 11: SEGMENT REPORTING The Company has determined that the Chief Executive Officer (“CEO”) is the Company’s chief operating decision maker (“CODM”) as the CEO makes decisions as it relates to allocation of resources and key market strategies. The CODM reviews financial information presented on a consolidated basis. Additionally, resource allocation and key market strategy decisions are made by the CODM based on consolidated results. As such, it was concluded that the Company operates as one segment.

Description of Business and S_2

Description of Business and Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Revenue Recognition for Contracts with Customers	Revenue Recognition for Contracts with Customers The Company’s revenues are generated primarily through collaborative research, license, development and commercialization agreements. Accounting standards codification (“ASC”) 606, Revenue from Contracts with Customers (“ASC 606”) applies to all contracts with customers, except for contracts that are within the scope of other standards. Under ASC 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company evaluates the performance obligations promised in the contract that are based on goods and services that will be transferred to the customer and determines whether those obligations are both (i) capable of being distinct and (ii) distinct in the context of the contract. Goods or services that meet these criteria are considered distinct performance obligations. If both these criteria are not met, the goods and services are combined into a single performance obligation. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Arrangements that include rights to additional goods or services that are exercisable at a customer’s discretion are generally considered options. The Company assesses if these options provide a material right to the customer and if so, these options are considered performance obligations. The exercise of a material right is accounted for as a contract modification for accounting purposes. The Company recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) each performance obligation is satisfied at a point in time or over time, and if over time this is based on the use of an output or input method. For the nine months ended September 30, 2022 , the Company recorded cumulative catch up adjustments on its contracts with customers that decreased revenue by $ 5.1 million; the cumulative catch-up adjustments resulted from changes in total estimated effort required to satisfy performance obligations. Invoices issued as stipulated in contracts prior to revenue recognition are recorded as deferred revenue. Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue within current liabilities in the accompanying condensed consolidated balance sheets. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as noncurrent deferred revenue. Amounts recognized as revenue, but not yet invoiced are generally recognized as contract assets in the other current assets line item in the accompanying condensed consolidated balance sheets. During the nine months ended September 30, 2022, the Company recorded $ 10.8 million in revenue that was included in deferred revenue as of December 31, 2021. Milestone Payments – If an arrangement includes development and regulatory milestone payments, the Company evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. Milestone payments that are not within the Company’s or the licensee’s control, such as regulatory approvals, are not considered probable of being achieved until those approvals are received and therefore revenue recognized is constrained as management is unable to assert that a reversal of revenue would not be probable. The transaction price is then allocated to each performance obligation on a relative standalone selling price basis, for which the Company recognizes revenue as or when the performance obligations under the contract are satisfied. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of such development milestones and any related constraint, and, if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect collaboration revenues and earnings in the period of adjustment. Royalties – For arrangements that include sales-based royalties, including milestone payments based on a level of sales, which are the result of a customer-vendor relationship and for which the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation linked to some or all of the royalty has been satisfied or partially satisfied. To date, the Company has not recognized any royalty revenue resulting from any of its licensing arrangements. Significant Financing Component – In determining the transaction price, the Company adjusts consideration for the effects of the time value of money if the timing of payments provides the Company with a significant benefit of financing. The Company does not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment by the licensees and the transfer of the promised goods or services to the licensees will be one year or less. The Company assessed each of its revenue arrangements in order to determine whether a significant financing component exists and concluded that a significant financing component does not exist in any of its arrangements. Collaborative Arrangements – The Company has entered into collaboration agreements, which are within the scope of ASC 606, to discover, develop, manufacture and commercialize product candidates. The terms of these agreements typically contain multiple promises or obligations, which may include: (1) licenses, or options to obtain licenses, to use the Company’s technology, (2) research and development activities to be performed on behalf of the collaboration partner, and (3) in certain cases, services in connection with the manufacturing of preclinical and clinical material. Payments the Company receives under these arrangements typically include one or more of the following: non-refundable, upfront license fees; option exercise fees; funding of research and/or development efforts; clinical and development, regulatory, and sales milestone payments; and royalties on future product sales. The Company analyzes its collaboration arrangements to assess whether the collaboration agreements are within the scope of ASC 808, Collaborative Arrangements (“ASC 808”) to determine whether such arrangements involve joint operating activities performed by parties that are both active participants in the activities and exposed to significant risks and rewards dependent on the commercial success of such activities. This assessment is performed throughout the life of the arrangement based on changes in the responsibilities of all parties in the arrangement. For collaboration arrangements within the scope of ASC 808 that contain multiple elements, the Company first determines which elements of the collaboration are deemed to be within the scope of ASC 808 and those that are more reflective of a vendor-customer relationship and, therefore, are within the scope of ASC 606. For elements of collaboration arrangements that are accounted for pursuant to ASC 808, an appropriate recognition method is determined and applied consistently, generally by analogy to ASC 606. For those elements of the arrangement that are accounted for pursuant to ASC 606, the Company applies the five-step model described above. For additional discussion of accounting for collaboration revenues, see Note 9, “Collaboration and License Agreements.”

Share-Based Compensation (Table

Share-Based Compensation (Tables)	9 Months Ended
	Sep. 30, 2022
Share-Based Payment Arrangement [Abstract]
Schedule of Stock-Based Compensation Expense	The Company recorded employee and nonemployee share-based compensation expense as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Employee $ 4,215 $ 4,151 $ 11,977 $ 10,942 Nonemployee 918 400 2,684 1,137 $ 5,133 $ 4,551 $ 14,661 $ 12,079
Schedule of Stock-Based Compensation Expense	Share-based compensation expense is included in the following line items in the condensed consolidated statements of operations (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Research and development $ 2,069 $ 2,563 $ 6,227 $ 6,916 General and administrative 3,064 1,988 8,434 5,163 $ 5,133 $ 4,551 $ 14,661 $ 12,079
Schedule of Stock Options Valuation Assumptions Using a Black-Scholes Option Pricing Model	The fair value of each stock option grant is estimated using a Black-Scholes option-pricing model on the date of grant as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2022 Estimated dividend yield 0.00 % 0.00 % Weighted-average expected stock price volatility 80.34 % 79.25 % Weighted-average risk-free interest rate 3.11 % 2.42 % Expected term of options (in years) 6.06 6.08 Weighted-average fair value per option $ 1.09 $ 1.94
Summary of Activity of Option Plans	The following table summarizes activity in the Company’s stock option plans for the nine months ended September 30, 2022: Outstanding Option Shares Weighted-Average Exercise Price Balance as of January 1, 2022 9,920,314 $ 9.28 Granted 6,191,412 2.80 Exercised ( 330,359 ) 1.17 Forfeited/canceled ( 1,971,964 ) 9.65 Balance as of September 30, 2022 13,809,403 $ 6.52
Summary of Restricted Stock Unit Activity	The following table summarizes the Company’s RSU activity for the nine months ended September 30, 2022: RSU Awards Weighted-Average Grant Date Fair Value Unvested RSUs as of January 1, 2022 773,503 11.29 Granted 1,826,307 $ 3.64 Forfeited ( 175,781 ) 7.19 Vested ( 264,115 ) 11.34 Unvested RSUs as of September 30, 2022 2,159,914 $ 5.15

Commitments and Contingencies (

Commitments and Contingencies (Tables)	9 Months Ended
	Sep. 30, 2022
Commitments and Contingencies Disclosure [Abstract]
Schedule of Future Lease Payments under Non-Cancelable Leases	Future lease payments under non-cancelable operating leases with terms of greater than one year as of September 30, 2022, were as follows: (in thousands) September 30, 2022 2022 (excluding the nine months ended September 30, 2022) $ 569 2023 2,323 2024 1,594 2025 529 2026 545 2027 and beyond 372 Total lease payments 5,932 Less: imputed interest 646 Total operating lease liabilities $ 5,286

Fair Value Measurement (Tables)

Fair Value Measurement (Tables)	9 Months Ended
	Sep. 30, 2022
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract]
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis	The following represents assets and liabilities measured at fair value on a recurring basis by the Company (in thousands): September 30, 2022 Fair Value Level 1 Level 2 Level 3 Assets: Money market funds $ 522 $ 522 $ — $ — Repurchase agreements 40,000 — 40,000 — Investment in iECURE 3,091 — — 3,091 $ 43,613 $ 522 $ 40,000 $ 3,091 Liabilities Final payment fee $ 204 $ — $ 204 $ — $ 204 $ — $ 204 $ — December 31, 2021 Fair Value Level 1 Level 2 Level 3 Assets: Money market funds $ 12 $ 12 $ — $ — Investment in iECURE 3,091 — — 3,091 $ 3,103 $ 12 $ — $ 3,091

Net Loss Per Share (Tables)

Net Loss Per Share (Tables)	9 Months Ended
	Sep. 30, 2022
Earnings Per Share [Abstract]
Schedule of Earnings Per Share, Basic and Diluted	The computations of basic and diluted net loss per share attributable to common stockholders are as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Net loss (in thousands) $ ( 23,946 ) $ ( 11,279 ) $ ( 83,149 ) $ ( 8,312 ) Weighted average common shares outstanding basic and diluted 110,849,196 59,657,677 80,127,701 58,018,550 Net loss per share, basic and diluted $ ( 0.22 ) $ ( 0.19 ) $ ( 1.04 ) $ ( 0.14 )
Schedule of Common Share Equivalent Securities Excluded from Calculation of Diluted Net Loss per Share	The following weighted-average common stock equivalents were excluded from the calculation of diluted net loss per share because their inclusion would have been anti-dilutive: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Unvested Restricted Stock Units 2,192,105 808,758 1,898,925 342,044 Stock Options 1,406,185 6,448,353 2,024,854 5,760,008 Unsettled ESPP Contributions 14,880 2,488 4,960 829 Total common stock equivalents excluded from diluted net loss per share 3,613,170 7,259,599 3,928,739 6,102,881

Description of Business and S_3

Description of Business and Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended				9 Months Ended
	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2021	Jun. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Description Of Business And Summary Of Significant Accounting Policies [Line Items]
Date of incorporation					Jan. 26, 2006
Proceeds from offering of common stock, net of issuance costs					$ 49,345	$ 18,130
Revenue recorded included in deferred revenue					10,800
Maximum
Description Of Business And Summary Of Significant Accounting Policies [Line Items]
Revenue for changes in total estimated time to be incurred in the future to satisfy the performance obligation					$ 5,100
Common Stock
Description Of Business And Summary Of Significant Accounting Policies [Line Items]
Proceeds from issuance of common stock, net of issuance cost, Shares	36,274,651	561,405	348,432	1,293,754

Stockholders' Equity - Addition

Stockholders' Equity - Additional Information (Details) - $ / shares	Sep. 30, 2022	Dec. 31, 2021	Apr. 01, 2019
Stockholders' Equity Note [Abstract]
Common and preferred stocks, shares authorized			210,000,000
Common stock, shares authorized	200,000,000	200,000,000	200,000,000
Common stock, par value	$ 0.000005	$ 0.000005	$ 0.000005
Preferred stock, shares authorized	10,000,000	10,000,000	10,000,000
Preferred stock, par value	$ 0.0001	$ 0.0001	$ 0.0001

Share-Based Compensation - Addi

Share-Based Compensation - Additional Information (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
	Mar. 12, 2019	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Options outstanding		13,809,403		13,809,403		9,920,314
Share based compensation expense		$ 5,133	$ 4,551	$ 14,661	$ 12,079
Intrinsic value of Stock options exercised				700	14,900
Unrecognized compensation cost		$ 34,700		$ 34,700
Weighted-average period for recognition of compensation cost				2 years 6 months
Restricted Stock Units
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
RSU outstanding		2,159,914		2,159,914		773,503
Share Based Compensation Arrangement By Share Based Payment Award Options Grants In Period Gross				1,826,307
Share Based Compensation Arrangement By Share Based Payment Award Options Grant Date Fair Value				$ 6,600
ESPP
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Share based compensation expense				$ 100	$ 300
2006 and 2015 Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Options outstanding		1,986,843		1,986,843
Remaining shares available to be granted		0		0
2019 Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Options outstanding		9,070,937		9,070,937
Number of shares available for issuance	4,750,000	6,589,999		6,589,999
Number of shares available to be issued		1,435,635		1,435,635
Allowed annual percentage increase in shares authorized as percentage of outstanding shares of common stock	4%
2019 Plan | Restricted Stock Units
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
RSU outstanding		1,936,252		1,936,252
2019 ESPP
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Remaining shares available to be granted		1,724,712		1,724,712
Allowed annual percentage increase in shares authorized as percentage of outstanding shares of common stock	1%
Increase in common stock available for issuance		1,647,499		1,647,499
Purchase of common stock through payroll deductions expressed in percentage of fair market value	85%
Total number of shares issued under 2019 ESPP		447,787		447,787
2019 ESPP | Maximum
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Remaining shares available to be granted	525,000
Inducement Award Plan
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Options outstanding		2,751,623		2,751,623
Number of shares available for issuance		6,024,715		6,024,715
Inducement Award Plan | Maximum
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Maximum shares allowed to be issued under the plan		9,000,000		9,000,000
Inducement Award Plan | Restricted Stock Units
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
RSU outstanding		223,662		223,662

Share-Based Compensation - Sche

Share-Based Compensation - Schedule of Employee and Nonemployee Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Share-based compensation expense	$ 5,133	$ 4,551	$ 14,661	$ 12,079
Employee
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Share-based compensation expense	4,215	4,151	11,977	10,942
Nonemployee
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Share-based compensation expense	$ 918	$ 400	$ 2,684	$ 1,137

Share-Based Compensation - Sc_2

Share-Based Compensation - Schedule of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Share-based compensation expense	$ 5,133	$ 4,551	$ 14,661	$ 12,079
Stock Option
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Share-based compensation expense	5,133	4,551	14,661	12,079
Research and Development | Stock Option
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Share-based compensation expense	2,069	2,563	6,227	6,916
General and Administrative | Stock Option
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items]
Share-based compensation expense	$ 3,064	$ 1,988	$ 8,434	$ 5,163

Share-Based Compensation - Sc_3

Share-Based Compensation - Schedule of Stock Options Valuation Assumptions Using a Black-Scholes Option Pricing Model (Details) - $ / shares	3 Months Ended	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2022
Share-Based Payment Arrangement [Abstract]
Estimated dividend yield	0%	0%
Weighted-average expected stock price volatility	80.34%	79.25%
Weighted-average risk-free interest rate	3.11%	2.42%
Expected term of options (in years)	6 years 21 days	6 years 29 days
Weighted-average fair value per option	$ 1.09	$ 1.94

Share-Based Compensation - Summ

Share-Based Compensation - Summary of Activity of Option Plans (Details)	9 Months Ended
	Sep. 30, 2022 $ / shares shares
Share-Based Payment Arrangement [Abstract]
Outstanding Option Shares, Beginning Balance | shares	9,920,314
Option, Granted | shares	6,191,412
Option, Exercised | shares	(330,359)
Option, Forfeited/canceled | shares	(1,971,964)
Outstanding Option Shares, Ending Balance | shares	13,809,403
Weighted-Average Exercise Price Outstanding at Beginning Balance | $ / shares	$ 9.28
Weighted-Average Exercise Price, Granted | $ / shares	2.80
Weighted-Average Exercise Price, Exercised | $ / shares	1.17
Weighted-Average Exercise Price, Forfeited/canceled | $ / shares	9.65
Weighted-Average Exercise Price Outstanding at Ending Balance | $ / shares	$ 6.52

Share-Based Compensation - Su_2

Share-Based Compensation - Summary of Activity of RSUs (Details) - Restricted Stock Units	9 Months Ended
	Sep. 30, 2022 $ / shares shares
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Unvested RSUs as of January 1, 2022 | shares	773,503
Share Based Compensation Arrangement By Share Based Payment Award Options Grants In Period Gross | shares	1,826,307
Forfeited | shares	(175,781)
Vested | shares	(264,115)
Unvested RSUs as of June 30, 2022 | shares	2,159,914
Weighted-Average Grant Date Fair Value, Beginning Balance | $ / shares	$ 11.29
Weighted-Average Grant Date Fair Value, Granted | $ / shares	3.64
Weighted-Average Grant Date Fair Value, Forfeited | $ / shares	7.19
Weighted-Average Grant Date Fair Value, Vested | $ / shares	11.34
Weighted-Average Grant Date Fair Value, Ending Balance | $ / shares	$ 5.15

Commitments and Contingencies -

Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Thousands		9 Months Ended
	Apr. 09, 2021	Sep. 30, 2022	Dec. 31, 2021
Commitments And Contingencies [Line Items]
Contract liabilities		$ 0	$ 0
Supply Agreements
Commitments And Contingencies [Line Items]
Agreement termination notice period		1 year
Maximum
Commitments And Contingencies [Line Items]
Product development and commercialization period	10 years
Contract Liabilities
Commitments And Contingencies [Line Items]
Contract liabilities		$ 10,000	$ 10,000

Commitments and Contingencies_2

Commitments and Contingencies - Schedule of Future Lease Payments under Non-Cancelable Leases (Details) $ in Thousands	Sep. 30, 2022 USD ($)
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
2022 (excluding the nine months ended September 30, 2022)	$ 569
2023	2,323
2024	1,594
2025	529
2026	545
2027 and beyond	372
Total lease payments	5,932
Less: imputed interest	646
Total operating lease liabilities	$ 5,286

Debt - Additional Information (

Debt - Additional Information (Details) - USD ($) $ in Millions	1 Months Ended			9 Months Ended
	Jul. 31, 2022	May 31, 2022	Dec. 31, 2021	Sep. 30, 2022	May 31, 2021
Debt Instrument [Line Items]
Interest rate during period				7%
Effective interest rate				8%
Elo Loan
Debt Instrument [Line Items]
Loan amount					$ 2.5
Pacific Western Loan Agreement | Revolving Credit Facility
Debt Instrument [Line Items]
Aggregate principal amount					$ 30
Proceeds from lines of credit		$ 20	$ 2.5
Borrowings				$ 22.5
Unamortized revolving line debt discount balance				$ 0.3
Seventh Amendment to Revolving Line | Revolving Credit Facility
Debt Instrument [Line Items]
Milestone amount received	$ 100
Basis point added to the prime rate		0.75%
Maturity of line of credit	Jun. 23, 2024
Seventh Amendment to Revolving Line | Revolving Credit Facility | Minimum [Member]
Debt Instrument [Line Items]
Required balance of unrestricted cash at bank	$ 10
Interest rate during period		4.25%

Income Taxes - Additional Infor

Income Taxes - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2022	Sep. 30, 2022
Income Tax Disclosure [Line Items]
Uncertain tax positions		$ 0
Forecast
Income Tax Disclosure [Line Items]
Effective income tax rate	0%

Fair Value Measurements - Addit

Fair Value Measurements - Additional information (Details) - USD ($)	3 Months Ended	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investment in equity securities	$ 274,000		$ 274,000
Equity Issuance Agreement | iECURE
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Investment in equity securities		$ 0
Amendment to Revolving Line | Revolving Credit Facility
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Change in fair value of final payment fee		$ 0

Fair Value Measurements - Sched

Fair Value Measurements - Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - Fair Value Measurements Recurring - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets	$ 43,613	$ 3,103
Liabilities	204
Final Payment Fee
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Liabilities	204
Repurchase Agreements
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets	40,000
Investment in iECURE
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets	3,091	3,091
Level 1
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets	522	12
Level 2
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets	40,000
Liabilities	204
Level 2 | Final Payment Fee
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Liabilities	204
Level 2 | Repurchase Agreements
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets	40,000
Level 3
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets	3,091	3,091
Level 3 | Investment in iECURE
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets	3,091	3,091
Money Market Funds
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets	522	12
Money Market Funds | Level 1
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Assets	$ 522	$ 12

Elo Transaction - Additional In

Elo Transaction - Additional Information (Details) - USD ($)		3 Months Ended	9 Months Ended
	Dec. 17, 2021	Sep. 30, 2022	Sep. 30, 2022	Dec. 31, 2021
Deconsolidation Of Subsidiary [Line Items]
Interest rate during period		7%	7%
Carrying value of note receivable		$ 6,711,000	$ 6,711,000	$ 6,879,000
Loss from equity method investment		1,783,000	4,183,000
Carrying value of Investment				$ 3,751,000
New Elo
Deconsolidation Of Subsidiary [Line Items]
Percentage of voting shares owned	55%
Loss from equity method investment		1,800,000	4,200,000
Carrying value of Investment		0	0
Promissory Note | New Elo
Deconsolidation Of Subsidiary [Line Items]
Notes received	$ 10,000,000
Debt instrument maturity date	Dec. 01, 2028
Interest rate during period	2%
Carrying value of note receivable		6,700,000	6,700,000
Promissory note discount		$ 3,300,000	3,300,000
Loss from equity method investment			$ 400,000

Collaboration and License Agr_2

Collaboration and License Agreements - Additional Information (Details) - USD ($)				1 Months Ended	3 Months Ended		9 Months Ended
	Jun. 14, 2022	Apr. 09, 2021	Jan. 06, 2021	Jul. 31, 2022	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021	Aug. 31, 2021
Collaboration and License Agreements [Line items]
Equity method investments									$ 3,751,000
Revenue					$ 7,363,000	$ 24,036,000	$ 14,500,000	$ 109,190,000
Deferred revenue					$ 48,405,000		$ 48,405,000		$ 21,244,000
Common stock, shares issued					111,745,219		111,745,219		61,712,577
Proceeds from offering of common stock, net of issuance costs							$ 49,345,000	18,130,000
Prepaid expenses					$ 12,292,000		12,292,000		$ 17,434,000
Research and development					19,959,000	25,940,000	62,867,000	88,768,000
Revenue recorded included in deferred revenue							10,800,000
Servier | Program Purchase Agreement
Collaboration and License Agreements [Line items]
Research and development		$ 1,250,000
Waiver of milestone payment		$ 18,750,000
Research and Development Arrangement
Collaboration and License Agreements [Line items]
Prepaid Expense and Other Assets					11,200,000		11,200,000
Prepaid expenses					4,200,000		4,200,000
Other Assets					7,000,000		7,000,000
Research and development							1,700,000
Research and Development Arrangement | Current Liabilities
Collaboration and License Agreements [Line items]
Deferred revenue					30,100,000		30,100,000
Research and Development Arrangement | Novartis Pharma AG
Collaboration and License Agreements [Line items]
Upfront cash payment	$ 50,000,000
Milestone payments to be received for additional targets	$ 1,400,000,000
Obligation to pay royalties expiry date	10 years
Transaction price from the Stock Purchase Agreement	$ 13,400,000
Revenue					3,600,000		3,600,000
Deferred revenue related to agreement					60,000,000		$ 60,000,000
Research and Development Arrangement | Novartis Pharma AG | Stock Purchase Agreement
Collaboration and License Agreements [Line items]
Upfront cash payment				$ 50,000,000
Sale of stock, number of shares issued in transaction	12,407,440
Aggregate purchase price	$ 25,000,000
Sale of stock, price per share	$ 2.01
Percentage of premium over the volume-weighted-average-price of the company’s common stock	20%
Upfront Compensation	$ 75,000,000
Equity upon the issuance of the shares	11,600,000
Transaction price allocated to the revenue arrangement	$ 63,400,000
Sale of stock, description of transaction							Pursuant to the Novartis Stock Purchase Agreement, subject to certain exceptions, Novartis may not sell the Novartis Shares without the Company’s approval for a period of two years following the Novartis Effective Date. In addition, for a period of two years following the Novartis Effective Date, Novartis and its affiliates may not (a) effect or otherwise participate in, directly or indirectly, any acquisition of any of our securities or material assets, any tender offer or exchange offer, merger or other business combination or change of control involving the Company, any recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction with respect to the Company, or any solicitation of proxies or consents to vote any of the Company’s securities or (b) act with any other person, or publicly disclose any intention, to do any of the foregoing. The Novartis Stock Purchase Agreement also contains customary representations, warranties, and covenants of both parties.
Research and Development Arrangement | Eli Lilly and Company
Collaboration and License Agreements [Line items]
Upfront cash payment			$ 100,000,000
Milestone payments to be received for additional targets			420,000,000
Transaction price from the Stock Purchase Agreement			7,300,000
Revenue					3,800,000	$ 4,900,000	$ 10,900,000	15,600,000
Deferred revenue related to agreement					78,900,000		78,900,000		88,300,000
Research and Development Arrangement | Eli Lilly and Company | Current Liabilities
Collaboration and License Agreements [Line items]
Deferred revenue					18,300,000		18,300,000		21,200,000
Research and Development Arrangement | Eli Lilly and Company | Stock Purchase Agreement
Collaboration and License Agreements [Line items]
Upfront Compensation			135,000,000
Equity upon the issuance of the shares			27,700,000
Transaction price allocated to the revenue arrangement			$ 107,300,000
Common stock, shares issued			3,762,190
Proceeds from offering of common stock, net of issuance costs			$ 35,000,000
Research and Development Arrangement | iECURE
Collaboration and License Agreements [Line items]
Investment in equity securities					0		0			$ 500,000
Prepaid Expense and Other Assets										$ 17,400,000
Development And Commercial License Agreement | Servier
Collaboration and License Agreements [Line items]
Deferred revenue related to agreement					$ 0		0		$ 0
Revenue recorded included in deferred revenue							$ 0	$ 72,900,000

Net Loss Per Share - Schedule O

Net Loss Per Share - Schedule Of Basic And Diluted Net Loss Per Share Attributable To Common Stockholders (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended						9 Months Ended
	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Sep. 30, 2022	Sep. 30, 2021
Earnings Per Share [Abstract]
Net loss (in thousands)	$ (23,946)	$ (31,035)	$ (28,168)	$ (11,279)	$ 21,656	$ (18,689)	$ (83,149)	$ (8,312)
Weighted average common shares outstanding - basic	110,849,196			59,657,677			80,127,701	58,018,550
Weighted average common shares outstanding - diluted	110,849,196			59,657,677			80,127,701	58,018,550
Net loss per share - basic	$ (0.22)			$ (0.19)			$ (1.04)	$ (0.14)
Net loss per share - diluted	$ (0.22)			$ (0.19)			$ (1.04)	$ (0.14)

Net Loss Per Share - Schedule_2

Net Loss Per Share - Schedule of Common Share Equivalent Securities Excluded from Calculation of Diluted Net Loss per Share (Details) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive common share equivalents	3,613,170	7,259,599	3,928,739	6,102,881
Restricted Stock Units
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive common share equivalents	2,192,105	808,758	1,898,925	342,044
Stock Option
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive common share equivalents	1,406,185	6,448,353	2,024,854	5,760,008
Unsettled ESPP Contributions
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Antidilutive common share equivalents	14,880	2,488	4,960	829

Segment Reporting - Additional

Segment Reporting - Additional Information (Details)	9 Months Ended
	Sep. 30, 2022 Segment
Segment Reporting [Abstract]
Number of reportable segments	1