Item 2.02 Results of Operations and Financial Condition.
On August 3, 2022, Poseida Therapeutics, Inc. (the "Company," "we," "us" and"our") filed a preliminary prospectus supplement with the Securities andExchange Commission (the "SEC") in which we disclosed that, based on currentlyavailable information, we expect our cash, cash equivalents and short-terminvestments as of June 30, 2022 to be approximately $142.6 million.
The preliminary results set forth above are based on management's initial reviewof our operations for the quarter ended June 30, 2022 and are subject tocompletion of financial closing procedures. The preliminary financial results inthis Item 2.02 have been prepared by, and are the responsibility of management.Actual results may differ materially from these preliminary results as a resultof the completion of financial closing procedures, final adjustments, and otherdevelopments arising between now and the time that our financial results arefinalized. In addition, these preliminary results are not a comprehensivestatement of our financial results for the quarter ended June 30, 2022, shouldnot be viewed as a substitute for full financial statements prepared inaccordance with generally accepted accounting principles, and are notnecessarily indicative of our results for any future period.PricewaterhouseCoopers LLP has not audited, reviewed, compiled, or appliedagreed-upon procedures with respect to the preliminary financial results.Accordingly, PricewaterhouseCoopers LLP does not express an opinion or any otherform of assurance with respect thereto.
Item 8.01 Other Events.
We are filing the following information for the purpose of supplementing andupdating certain disclosures contained in our prior filings with the SEC,including those discussed under the heading "Risk Factors" in our most recentQuarterly Report on Form 10-Q for the quarter ended March 31, 2022, filed withthe SEC on May 12, 2022 (the "Quarterly Report") and certain aspects of ourpublicly disclosed description of our business contained in our other filingswith the SEC.
Company Overview
We are a clinical-stage biopharmaceutical company dedicated to utilizing ourproprietary genetic engineering platform technologies to create next-generationcell and gene therapeutics with the capacity to cure. We have discovered and aredeveloping a broad portfolio of product candidates in a variety of indicationsbased on our core proprietary platforms, including our non-viral piggyBac DNADelivery System, Cas-CLOVER Site-specific Gene Editing System and nanoparticleand AAV-based gene delivery technologies. Our core platform technologies haveutility, either alone or in combination, across many cell and gene therapeuticmodalities and enable us to engineer our portfolio of product candidates thatare designed to overcome the primary limitations of current generation cell andgene therapeutics.
Within cell therapy, we believe our technologies allow us to create productcandidates with engineered cells that engraft in the patient's body and drivelasting durable responses that may have the capacity to result in singletreatment cures. Our CAR-T therapy portfolio consists of both autologous andallogeneic, or off-the-shelf, product candidates. We are advancing a broadpipeline and have multiple CAR-T product candidates in the clinical phase inboth hematological and solid tumor oncology indications. Within gene therapy, webelieve our technologies have the potential to create next-generation therapiesthat can deliver long-term, stable gene expression that does not diminish overtime and that may have the capacity to result in single treatment cures.
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CAR-T for Oncology
The following table summarizes our current CAR-T for oncology product candidateportfolio, including a representation of programs that we partnered with F.Hoffmann-La Roche Ltd and Hoffmann-La Roche Inc. (collectively "Roche") in July2022:
Our most advanced investigational clinical programs are:
We manufacture these product candidates using our non-viral piggyBac DNADelivery System. Our fully allogeneic CAR-T product candidates are developedusing well-characterized cells derived from a healthy donor as starting materialwith the goal of enabling treatment of potentially hundreds of patients from asingle manufacturing run. Doses are cryopreserved and stored at treatmentcenters for future off-the-shelf use. In addition, our allogeneic productcandidates use our proprietary Cas-CLOVER Site-specific Gene Editing System toreduce or eliminate reactivity, as well as our booster molecule technology formanufacturing scalability.
Our most advanced preclinical cell therapy program is:
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Gene Therapy
Our gene therapy product candidates have been developed by utilizing ourpiggyBac technology together with AAV to overcome the major limitations oftraditional AAV gene therapy. We believe that our approach can result inintegration and long-term stable expression at potentially much lower doses thanAAV technology alone, thus also conferring cost and tolerability benefits. Oureventual goal is to completely replace AAV with our non-viral nanoparticletechnology, freeing future product development in gene therapy of AAVlimitations.
The following table summarizes our current gene therapy product candidateportfolio including a representation of programs that we partnered with TakedaPharmaceuticals USA, Inc. (Takeda) in October 2021:
Our most advanced gene therapy programs are:
We expect our expenses and losses to increase substantially for the foreseeablefuture as we continue our development of, and seek regulatory approvals for, ourproduct candidates, including P-PSMA-101 and P-MUC1C-ALLO1, and begin tocommercialize any approved products. While we anticipate an overall increase indevelopment costs as we continue to expand the number of product candidates inour pipeline and pursue clinical development of those candidates, we expect adecrease in our development costs on a per program basis as we are transitioningto our allogeneic platform. In addition, all or some of the development costsrelated to partnered gene therapy programs and cell therapy programs will bereimbursed by Takeda and Roche, respectively. We also expect our general andadministrative expenses will increase for the foreseeable future to support ourincreased research and
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development and other corporate activities. Our net losses may fluctuatesignificantly from quarter-to-quarter and year-to-year, depending on the timingof our clinical trials and our expenditures on other research and developmentactivities.
We do not expect to generate any revenues from product sales unless and until wesuccessfully complete development and obtain regulatory approval for P-PSMA-101and P-MUC1C-ALLO1, or any other product candidates, which will not be for atleast the next several years, if ever. If we obtain regulatory approval for anyof our product candidates, we expect to incur significant commercializationexpenses related to product sales, marketing, manufacturing and distributionactivities. Accordingly, until such time, if ever, as we can generatesubstantial product revenue, we expect to finance our operations through equityofferings, debt financings or other capital sources, including potential grants,collaborations, licenses or other similar arrangements.
However, we may not be able to secure additional financing or enter into suchother arrangements in a timely manner or on favorable terms, if at all. Therecan be no assurances that we will be able to secure such additional sources offunds to support our operations, or, if such funds are available to us, thatsuch additional financing will be sufficient to meet our needs. Our failure toraise capital or enter into such other arrangements when needed would have anegative impact on our financial condition and could force us to delay, reduceor terminate our research and development programs or other operations, or grantrights to develop and market product candidates that we would otherwise preferto develop and market ourselves.
The manufacturing process for our allogeneic product candidates is nearlyidentical to the process for our autologous product candidates, except for thegene editing and related steps. We work with a number of third-party contractmanufacturing organizations for production of our product candidates. We alsowork with a variety of suppliers to provide our manufacturing raw materialsincluding media, DNA and RNA components. We have completed construction of aninternal pilot GMP manufacturing facility in San Diego, California adjacent toour headquarters to develop and manufacture preclinical materials and clinicalsupplies of our product candidates for Phase 1 and Phase 2 clinical trials inthe future. We commenced GMP activity in the third quarter of 2021, however weexpect that we will continue to rely on third parties for various manufacturingneeds. In the future, we may also build one or more commercial manufacturingfacilities for any approved product candidates.
An investment in our common stock is speculative and involves a high degree ofrisk. Our business, reputation, results of operations and financial condition,as well as the price of our common stock, can be affected by a number offactors, whether currently known or unknown, including those described under theheading "Risk Factors" of our Quarterly Report. If any of such risks occur, ourbusiness, financial condition, results of operations and future growth prospectscould be materially and adversely affected. In these circumstances, the marketprice of our common stock could decline, and you may lose all or part of yourinvestment. Below are certain changes to our risk factors included in theQuarterly Report.
Risks Related to Our In-Licenses and Other Strategic Agreements
We may not realize the benefits of any acquisitions, in-license or strategicalliances that we enter into or fail to capitalize on programs that may presenta greater commercial opportunity or for which there is a greater likelihood ofsuccess.
Our business depends upon our ability to identify, develop and commercializeresearch programs or product candidates. A key element of our business strategyis to discover and develop additional programs based upon our core proprietaryplatforms, including our non-viral piggyBac DNA Delivery System, Cas-CLOVERSite-specific Gene Editing System and nanoparticle- and AAV-based gene deliverytechnologies. In addition to internal research and development efforts, we arealso seeking to do so through strategic collaborations, such as ourcollaborations with Roche and Takeda, and may also explore additional strategiccollaborations for the discovery of new programs. We have also entered intoin-license agreements with multiple licensors and in the future may seek toenter into acquisitions or additional licensing arrangements with third partiesthat we believe will complement or augment our existing technologies and productcandidates.
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These transactions can entail numerous operational and financial risks,including exposure to unknown liabilities, disruption of our business anddiversion of our management's time and attention in order to manage acollaboration or develop acquired products, product candidates or technologies,incurrence of substantial debt or dilutive issuances of equity securities to paytransaction consideration or costs, higher than expected development ormanufacturing costs, higher than expected personnel and other resourcecommitments, higher than expected collaboration, acquisition or integrationcosts, write-downs of assets or goodwill or impairment charges, increasedamortization expenses, difficulty and cost in facilitating the collaboration orcombining the operations and personnel of any acquired business, impairment ofrelationships with key suppliers, manufacturers or customers of any acquiredbusiness due to changes in management and ownership and the inability to retainkey employees of any acquired business. As a result, if we enter intoacquisition or in-license agreements or strategic partnerships, we may not beable to realize the benefit of such transactions if we are unable tosuccessfully integrate them with our existing operations and company culture, orif there are materially adverse impacts on our or the counterparty's operationsresulting from COVID-19, which could delay our timelines or otherwise adverselyaffect our business. Further, because we have limited resources, we must chooseto pursue and fund the development of specific types of treatment, or treatmentfor a specific type of cancer, and we may forego or delay pursuit ofopportunities with certain programs or products or for indications that laterprove to have greater commercial potential. Our estimates regarding thepotential market for our program could be inaccurate, and if we do notaccurately evaluate the commercial potential for a particular program, we mayrelinquish valuable rights to that program through a strategic collaboration,licensing or other arrangements in cases in which it would have been moreadvantageous for us to retain sole development and commercialization rights tosuch program. Alternatively, we may allocate internal resources to a program inwhich it would have been more advantageous to enter into a partneringarrangement. If any of these events occur, we may be forced to abandon or delayour development efforts with respect to a particular product candidate or failto develop a potentially successful program.
Our collaborators may not devote sufficient resources to the development orcommercialization of our product candidates or may otherwise fail in developmentor commercialization efforts, which could adversely affect our ability todevelop or commercialize certain of our product candidates and our financialcondition and operating results.
We have, with respect to our collaborations with Roche and Takeda, and willlikely have, with respect to any additional collaboration arrangements with anythird parties, limited control over the amount and timing of resources that ourcollaborators dedicate to the development or commercialization of our productcandidates. For example, while we expect to collaborate with Takeda on thedevelopment of up to six in vivo gene therapy programs, only two such programshave been designated by Takeda and we cannot guarantee that Takeda will elect topursue development of additional gene therapy programs under the collaboration.Similarly, while we expect to collaborate with Roche on the development of up toten allogeneic CAR-T cell therapy programs and have granted to Roche an optionto acquire licenses under certain of our intellectual property to develop,manufacture and commercialize products for up to three solid tumor targets, onlytwo such programs have been designated by Roche and we cannot guarantee thatRoche will elect to pursue development of additional cell therapy programs underthe Roche Collaboration Agreement. In each case, a decision by Roche or Takedato pursue less than the maximum number of targets or programs available forcollaboration under their respective collaboration agreements will limit thepotential payments we may receive under such collaboration agreements, delay ourdevelopment timelines or otherwise adversely affect our business. In general,our ability to generate revenues from these arrangements will depend on ourcollaborators' abilities to successfully perform the functions assigned to themin these arrangements and otherwise to comply with their contractualobligations.
Any of our existing or future collaborations may not ultimately be successful,which could have a negative impact on our business, results of operations,financial condition and growth prospects. In addition, the terms of any suchcollaboration or other arrangement may not prove to be favorable to us or maynot be perceived as favorable, which may negatively impact the trading price ofour common stock. In some cases, we may be responsible for continuingdevelopment or manufacture of a product or product candidate or research programunder collaboration and the payment we receive from our partner may beinsufficient to cover the cost of this development or manufacture. For example,under the Takeda Collaboration Agreement, we are obligated to perform certainplatform development activities at our own cost. In addition, under the RocheCollaboration Agreement, while Roche is obligated to reimburse us for aspecified percentage of certain costs incurred in performance of developmentactivities relating to P-BCMA-ALLO1 and P-CD19CD20-ALLO1, we will be responsiblefor the balance and the amount Roche is obligated to reimburse us is subject toa maximum cap.
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Conflicts may arise between us and our collaborators, such as conflictsconcerning the interpretation of clinical data, the achievement of milestones,the division of development responsibilities or expenses, development plans, theinterpretation of financial provisions, or the ownership of intellectualproperty developed during the collaboration. If any such conflicts arise, acollaborator could act in its own self-interest, which may be adverse to ourbest interests. Any such disagreement between us and a collaborator could delayor prevent the development or commercialization of our product candidates.
Further, we are subject to the following additional risks associated with ourcurrent and any future collaborations with third parties, the occurrence ofwhich could cause our collaboration arrangements to fail:
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Forward-Looking Statements
Statements contained in this Current Report regarding matters that are nothistorical facts are "forward-looking statements" within the meaning of thePrivate Securities Litigation Reform Act of 1995. Such forward-lookingstatements include statements regarding development activities under thecollaboration agreements; our expectations regarding the timing, scope andresults of our development activities, including our ongoing and plannedclinical trials; the timing of and plans for regulatory filings; the potentialbenefits of our product candidates and technologies; our expectations regardingthe use of our platform technologies to generate novel product candidates; themarket opportunities for our product candidates and our ability to maximizethose opportunities; our business strategies and goals; estimates of our cashbalance, expenses, capital requirements, any future revenue, and need foradditional financing; our expectations regarding manufacturing capabilities andplans; the performance of, and reliance on, our third-party suppliers andmanufacturers; our ability to attract and/or retain new and existingcollaborators with development, regulatory, manufacturing and commercializationexpertise and our expectations regarding the potential benefits to be derivedfrom such collaborations; the sufficiency of our existing cash and cashequivalents to fund our operations; and future events and uncertaintiesdescribed under the "Risk Factors" heading of this Current Report. In somecases, you can identify forward-looking statements because they contain wordssuch as "anticipate," "believe," "contemplate," "continue," "could," "estimate,""expect," "intend," "may," "plan," "potential," "predict," "project," "should,""target," "will" or "would" or the negative of these words or other similarterms or expressions. Because such statements are subject to risks anduncertainties, actual results may differ materially from those expressed orimplied by such forward-looking statements. These forward-looking statements arebased upon our current expectations and involve assumptions that may nevermaterialize or may prove to be incorrect. Actual results could differ materiallyfrom those anticipated in such forward-looking statements as a result of variousrisks and uncertainties, which include, without limitation, the fact that theRoche Collaboration Agreement may not become effective based onHart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, clearance, orthe effectiveness may be substantially delayed; our collaboration agreements may. . .
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