10-K: Precision BioSciences Reports 2025 Losses Amidst Pipeline Progress

Precision BioSciences' 2025 Annual Report reveals a significant net loss and revenue decline, offset by promising clinical advancements in its gene editing pipeline and a successful capital raise.

Summary

• Precision BioSciences, a clinical-stage gene editing company, reported a net loss of $(45.7) million for the year ended December 31, 2025, a decrease from a net income of $7.167 million in 2024.
• Revenue for 2025 was $34.3 million, down from $68.7 million in 2024, primarily due to the conclusion of a prior agreement with Prevail Therapeutics.
• Research and development expenses decreased to $54.2 million in 2025 from $59.6 million in 2024, driven by lower manufacturing and toxicology expenses for PBGENE-HBV and a pivot from PBGENE-3243, partially offset by increased investment in PBGENE-DMD.
• General and administrative expenses decreased to $32.2 million in 2025 from $35.3 million in 2024.
• The company's wholly-owned PBGENE-HBV program for chronic hepatitis B showed safety, tolerability, and dose-dependent antiviral activity in its Phase 1/2a ELIMINATE-B trial, with initial evidence of direct viral DNA gene editing.
• PBGENE-DMD, a treatment for Duchenne muscular dystrophy, received Rare Pediatric Disease, Orphan Drug, and Fast-Track designations, and IND clearance for its Phase 1/2 FUNCTION-DMD study.
• Development of PBGENE-3243 for m.3243 associated mitochondrial disease has been paused to prioritize lead programs.
• The collaboration agreement with Novartis Pharma AG was terminated effective January 30, 2026, resulting in the loss of future milestone and royalty payments from that partnership.
• Received an $8.0 million milestone payment from Imugene in October 2025 ($3.0 million cash, $5.0 million in Imugene stock) and earned a $7.5 million cash payment from TG Therapeutics in March 2026 for a clinical milestone.
• As of December 31, 2025, cash and cash equivalents totaled $110.8 million, with restricted cash of $26.3 million, and an accumulated deficit of $528.2 million.
• Successfully raised $75.0 million in gross proceeds from an underwritten offering of common stock and warrants in November 2025.
• The company's cash runway is estimated to be sufficient to fund operating expenses and capital expenditure requirements through 2028, covering PBGENE-HBV and PBGENE-DMD data milestones.

Sentiment

Score: 4

Explanation: StockSavvy.ai views this as a mixed bag. While there's promising clinical progress and strategic capital raising, the significant net loss, revenue decline, and termination of a major collaboration with Novartis indicate substantial financial challenges and increased risk, despite the positive clinical updates for lead programs.

Positives

• PBGENE-HBV Phase 1/2a ELIMINATE-B trial demonstrated safety, tolerability, cumulative, dose-dependent antiviral activity, and HBsAg declines across 13 participants and over 30 administrations, with initial evidence consistent with direct viral DNA gene editing.
• PBGENE-DMD received Rare Pediatric Disease designation in June 2025, Orphan Drug Designation in July 2025, and Fast-Track designation in February 2026, potentially expediting development and review.
• IND clearance for PBGENE-DMD was received from the FDA in February 2026, enabling the initiation of the Phase 1/2 FUNCTION-DMD clinical trial.
• New preclinical study data for PBGENE-DMD showed durable improvements in muscle function, increased dystrophin expression, and dystrophin-positive cells in a DMD mouse model.
• iECURE's ECUR-506, an ARCUS-mediated gene insertion therapy, achieved a complete clinical response in the first participant at the lowest dose level for neonatal onset OTC deficiency and was granted FDA Regenerative Medicine Advanced Therapy (RMAT) designation.
• Received an $8.0 million milestone payment from Imugene in October 2025, comprising $3.0 million in cash and $5.0 million in Imugene stock.
• Earned a $7.5 million cash payment from TG Therapeutics in March 2026 for achieving a clinical milestone.
• Successfully completed an underwritten offering in November 2025, raising $75.0 million in gross proceeds, which strengthens the company's financial position.
• The company's cash runway is projected to be sufficient to fund operating expenses and capital expenditure requirements through 2028, including key data milestones for PBGENE-HBV and PBGENE-DMD.

Negatives

• Reported a net loss of $(45.7) million for the year ended December 31, 2025, a significant decline from a net income of $7.167 million in 2024.
• Total revenue decreased by $34.4 million, from $68.7 million in 2024 to $34.3 million in 2025, primarily due to the conclusion of the Prevail Therapeutics agreement.
• Novartis Pharma AG terminated its research and development collaboration and license agreement, effective January 30, 2026, eliminating future milestone, royalty, option, and other payments from this partnership.
• Development of the PBGENE-3243 program for m.3243 associated mitochondrial disease has been paused to prioritize other lead programs, indicating a reduction in pipeline diversity.
• Loss from equity method investment increased to $(5.3) million in 2025 from $(1.1) million in 2024, partly due to reducing the carrying amount of the Note Receivable from Elo to $0 million due to collectability concerns.
• Experienced a loss on changes in other fair value adjustments of $(2.7) million in 2025, compared to a gain of $0.3 million in 2024.
• Interest income decreased by $2.6 million in 2025 compared to 2024, attributed to lower interest rates.
• The company has an accumulated deficit of $528.2 million as of December 31, 2025, and expects to continue incurring significant operating losses for the foreseeable future.
• The company will need substantial additional funding beyond 2028 to continue its operations and advance its product candidates.

Risks

• Incurred significant operating losses since inception and expects to continue incurring losses for the foreseeable future; may not achieve or maintain profitability.
• Will need substantial additional funding, and if unable to raise sufficient capital on acceptable terms, may be forced to delay, reduce, or eliminate research programs, product development, and commercialization efforts.
• Limited operating history makes it difficult to evaluate current business and future prospects, increasing investment risk.
• ARCUS is a novel technology, making it difficult to predict the time, cost, and potential success of product candidate development; limited ability to assess safety and efficacy in humans.
• Heavy dependence on the successful development and translation of ARCUS; no assurance that product candidates will be successfully developed and commercialized.
• Failure to achieve projected development milestones or commercialization in expected timeframes could harm the business.
• Adverse public perception of genome editing may negatively impact developmental progress or commercial success.
• Faces significant competition in industries experiencing rapid technological change; competitors may achieve regulatory approval before or develop safer/more effective treatments.
• Future profitability depends on commercialization ability in global markets, subject to complex regulatory, tax, and economic uncertainties.
• Product liability lawsuits could cause substantial liabilities and limit commercialization.
• The regulatory landscape for therapeutic product candidates is rigorous, complex, uncertain, and subject to change, potentially resulting in delays or termination of development.
• May not be able to submit INDs to the FDA or CTAs to comparable foreign authorities to commence clinical trials on expected timelines, or may not be permitted to proceed.
• Clinical trials are difficult to design and implement, expensive, time-consuming, and involve an uncertain outcome; inability to successfully and timely conduct clinical trials would substantially harm the business.
• Product candidates are novel and may be complex and difficult to manufacture; manufacturing problems could result in delays.
• Delays or difficulties in patient enrollment in clinical trials could delay or prevent receipt of regulatory approvals.
• Results of preclinical studies and early clinical trials may not be predictive of later studies; product candidates may not have favorable results in later clinical trials or receive regulatory approval.
• Interim, top-line, and initial data from studies may change as more data become available and are subject to audit and verification procedures.
• Product candidates may not work as intended or cause undesirable side effects, hindering regulatory approval or commercial potential.
• Subject to federal, state, and foreign healthcare laws and regulations; non-compliance could lead to substantial penalties.
• Actual or perceived failures to comply with applicable data protection, privacy, and security laws could adversely affect the business.
• Business and operations may suffer from information technology system failures, cyber-attacks, or security deficiencies.
• May not obtain or maintain orphan drug designation benefits, negatively impacting development or regulatory approval.
• Rare pediatric disease designation does not guarantee issuance of a priority review voucher.
• Fast Track Designation may not lead to faster development or regulatory review or approval.
• Regulatory approval in one jurisdiction does not ensure approval in other jurisdictions, limiting market opportunities.
• Current and future legislation may increase the difficulty and cost of obtaining marketing approval and commercializing product candidates.
• Approved products will remain subject to ongoing regulatory requirements, resulting in significant additional expense.
• FDA and other regulatory agencies actively enforce laws prohibiting the promotion of off-label uses, potentially leading to significant liability.
• Disruptions at the FDA and other government agencies could hinder their ability to approve or commercialize products in a timely manner.
• Even if approved, products may fail to achieve market acceptance by physicians, patients, and healthcare payors.
• Inability to establish sales and marketing capabilities or enter into agreements with third parties could hinder commercialization.
• Market opportunities for products may be smaller than estimates, or unable to successfully identify enough patients.
• Failure to obtain or maintain coverage and adequate reimbursement could limit marketability.
• Product candidates approved as biologic products may face competition from biosimilar products sooner than anticipated.
• May experience difficulties in managing business needs, disrupting operations.
• May engage in transactions that could disrupt business, cause dilution, or reduce financial resources.
• Future success depends on key executives and attracting, retaining, and motivating qualified personnel.
• Subject to increased costs as a public company; management must devote substantial time to compliance and corporate governance.
• Insurance policies are expensive and protect only from some business risks, leaving significant uninsured liabilities.
• Failure to comply with environmental, health, and safety laws and regulations could result in fines or significant costs.
• Business operations may expose the company to penalties for potential misconduct or improper activity.
• Subject to complex tax rules; audits, investigations, or tax proceedings could have a material adverse effect.
• May not be able to utilize all, or any, of its net operating loss carryforwards.
• Reliance on third parties for research, development, and manufacturing; failure by these parties could harm the business.
• Inability to establish collaborations on commercially reasonable terms may alter research, development, and commercialization plans.
• Ability to compete may decline if proprietary rights are not adequately protected or do not provide a competitive advantage.
• Third parties may assert claims alleging infringement of their patents and proprietary rights, or may need to become involved in lawsuits to defend or enforce patents.
• Developments in patent law could have a negative impact on the business.
• Inability to protect the confidentiality of trade secrets and enforce intellectual property assignment agreements would harm business.
• Will not seek to protect intellectual property rights in all jurisdictions, and may not be able to adequately enforce rights where protection is sought.
• May not be successful in obtaining or maintaining necessary rights to product components and processes through acquisitions and in-licenses.
• If trademarks and trade names are not adequately protected, may not be able to build name recognition.
• Could be subject to securities class action litigation.
• Does not currently intend to pay dividends on common stock.
• Provisions in amended and restated certificate of incorporation and bylaws or Delaware law might discourage, delay, or prevent a change in control.
• Exclusive forum provisions could limit stockholders' ability to obtain a favorable judicial forum.
• Reduced disclosure requirements as a smaller reporting company may make common stock less attractive to investors.
• Adversely affected by natural or manmade disasters, public health emergencies, and other natural catastrophic events.
• Unstable market and economic conditions may have serious adverse consequences on business, financial condition, and stock price.
• Failure to meet Nasdaq continued listing requirements could result in delisting of common stock.
• If securities or industry analysts issue an adverse or misleading opinion, stock price and trading volume could decline.

Future Outlook

The company expects to release additional clinical biomarker and biopsy data for PBGENE-HBV in the first half of 2026, which will inform the selection of an optimal dosing regimen for progression into the Part 2 expansion phase of the ELIMINATE-B trial. Further clinical data from PBGENE-HBV programs are anticipated at hepatitis-focused medical conferences throughout 2026. Initial data from multiple patients for the FUNCTION-DMD study is expected by year-end 2026, focusing on safety and early efficacy based on dystrophin protein expression from muscle biopsies. iECURE is also expected to release additional patient data from the OTC-HOPE trial in the first half of 2026. For the non-core ex vivo programs, preliminary Phase 1 azer-cel data in progressive multiple sclerosis is expected in the second half of 2026, along with the commencement of additional exploratory studies in autoimmune diseases. The company believes its existing cash and cash equivalents, expected azer-cel milestone proceeds, and the availability of its ATM facility will be sufficient to fund operating expenses and capital expenditure requirements through 2028, covering PBGENE-HBV and PBGENE-DMD data milestones.

Management Comments

• "We believe that the ARCUS platforms key capabilities and differentiating characteristics can be leveraged for effective and safe therapeutic outcomes."
• "We are dedicated to improving life. Our goal is to broadly translate the potential of genome editing into permanent genetic solutions for significant unmet medical needs by leveraging the ARCUS gene editing platform in genetic and infectious diseases."
• "We believe sustained loss of HBV DNA alone as a result of cccDNA elimination is an approvable endpoint for the U.S. Food and Drug Administration (FDA) and highly relevant for PBGENE-HBV."
• "We believe that our team, whom we call Precisioneers, has among the strongest scientific experience and capabilities of all genome editing companies."
• "We strongly believe that our shared values empower our team to better navigate and overcome challenges we may experience as we pursue our mission of improving life through genome editing."
• "We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition."
• "Our management team, including our Vice President of Operations and Information Technology and Head of Information Technology, has 20+ years of experience in cybersecurity and data risk administration, governance and technical operations, information technology enterprise architecture, and information technology management."

Industry Context

StockSavvy.ai notes that Precision BioSciences operates in the highly competitive and rapidly evolving gene editing and biopharmaceutical industries. The company's strategic focus on in vivo gene editing with its ARCUS platform positions it against major players like Beam Therapeutics, CRISPR Therapeutics, Editas Medicine, Intellia Therapeutics, Prime Medicine, Tune Therapeutics, and Verve Therapeutics. The termination of the Novartis collaboration highlights the inherent risks and competitive pressures in drug development partnerships, while the progress in PBGENE-HBV and PBGENE-DMD, along with RMAT and Fast-Track designations, indicates the company's efforts to differentiate its technology and pipeline in a crowded field. The shift to prioritize complex edits and gene insertion over gene knock-out opportunistically reflects an adaptation to emerging industry trends and perceived higher potential for therapeutic impact.

Comparison to Industry Standards

• Precision BioSciences' ARCUS platform is differentiated by its unique staggered cut, smaller size, and single-component nature compared to other genome editing technologies like zinc-finger nucleases (ZFNs), TAL-effector nucleases (TALENs), and CRISPR-based editors (CRISPR-Cas9 and CRISPR-Cas12).
• The company's PBGENE-HBV is highlighted as the "first and only potentially curative gene editing program to enter the clinic that is specifically designed to eliminate the root cause of chronic hepatitis B, covalently closed circular DNA (cccDNA)," positioning it uniquely against current standard-of-care treatments that rarely achieve a functional cure (less than 3 out of 100 patients).
• PBGENE-DMD aims to restore a "near full-length functional dystrophin protein" which is presented as a potentially superior approach compared to "synthetic, truncated microdystrophin approaches with minimal functional benefit" currently in the Duchenne muscular dystrophy treatment landscape.
• iECURE's ECUR-506, an ARCUS-mediated gene insertion therapy for neonatal onset ornithine transcarbamylase (OTC) deficiency, demonstrated a "complete clinical response in the first participant at the lowest dose level (1.3x10^13 GC/kg)," which is a significant early clinical result in the rare disease space, indicating strong potential for a novel therapeutic approach.
• The company states its team, "Precisioneers," possesses "among the strongest scientific experience and capabilities of all genome editing companies," with a co-founder having over 20 years of experience in genome editing technology, suggesting a competitive advantage in human capital.

Management Changes

Corporate Governance

Legal Proceedings

• Not currently party to any material legal proceedings.

Related Party Transactions

• The company has an equity method investment in Elo Life Systems, Inc. (Elo), which was formerly a wholly-owned subsidiary. In January 2026, as part of Elo raising additional funding, the company agreed to cancel a $10.0 million Note Receivable from Elo in exchange for a warrant to purchase shares of Elo's Series A-3 Preferred Stock and the issuance of shares of Elo's Series A-4 Preferred Stock annually through 2028 in lieu of forgone interest.
• The company has a license agreement with Duke University, from which it exclusively licenses patent families related to its ARCUS technology. The development of this technology was partly funded by the U.S. government, subjecting it to certain federal regulations including march-in rights and a preference for U.S.-based manufacturing.
• Amended and restated employment agreements with executive officers (Michael Amoroso, John Alexander Kelly, Dario Scimeca, and Jeff Smith) include provisions for an escrow account to satisfy a portion of severance obligations and legal fees in the event of a restructuring or change in control. As of December 31, 2025, the escrow account cash balance was $3.8 million.

Stakeholder Impact

• **Shareholders**: Face potential dilution from future equity offerings, continued stock price volatility, and the impact of anti-takeover provisions. No dividends are anticipated in the foreseeable future, meaning returns depend on stock appreciation. The significant net loss and collaboration termination could negatively impact investor confidence, while positive clinical data and extended cash runway offer some reassurance.
• **Employees (Precisioneers)**: Benefit from continued employment, comprehensive benefit plans (medical, dental, disability, 401(k), PTO, wellness, professional development), and eligibility for equity compensation. The amended employment agreements for executives aim to retain key talent and provide clarity on severance, potentially enhancing stability.
• **Customers/Patients**: Stand to benefit from the potential development of novel therapeutic options for chronic hepatitis B, Duchenne muscular dystrophy, and OTC deficiency if product candidates successfully navigate clinical trials and gain regulatory approval. However, the inherent risks of drug development mean these benefits are not guaranteed.
• **Collaborators (iECURE, TG Therapeutics, Imugene)**: Continue to engage in partnership activities, with potential for milestone and royalty payments based on product development and commercialization success. The termination of the Novartis agreement highlights the risk of collaboration changes and the need for ongoing strategic management.
• **Creditors (Banc of California)**: The 2024 Term Loan is secured by a cash security account, and the company is required to maintain a balance at least equal to the outstanding principal, providing a level of security for the lender.

Next Steps

• Expect additional clinical biomarker and biopsy data for PBGENE-HBV in the first half of 2026.
• Complete dosing in Cohorts 3, 4, and 5 for PBGENE-HBV to inform optimal dosing regimen selection for the Part 2 expansion phase.
• Share further clinical data from PBGENE-HBV programs at hepatitis-focused medical conferences throughout 2026.
• Initiate IRB activities and clinical trial site activation for the FUNCTION-DMD Phase 1/2 clinical trial for PBGENE-DMD.
• Expect initial data from multiple patients for the FUNCTION-DMD study by year-end 2026, assessing safety and early efficacy based on dystrophin protein expression from muscle biopsies.
• iECURE expects to release additional patient data from the OTC-HOPE trial in the first half of 2026.
• Anticipate presentation of preliminary Phase 1 azer-cel data in progressive multiple sclerosis in the second half of 2026.
• Commence additional exploratory studies for azer-cel in autoimmune diseases outside of multiple sclerosis.
• Elo agreed to cancel the Note Receivable in January 2026 in exchange for a warrant to purchase shares of Elo's Series A-3 Preferred Stock and the issuance of shares of Elo's Series A-4 Preferred Stock annually through 2028.
• Continue to explore a research collaboration with Novartis in an undisclosed area of joint therapeutic interest.
• Continue to build on critical capabilities to successfully impact patients.
• Seek additional capital if market conditions are favorable or in light of specific strategic considerations.

Key Dates

Recommendation

The company faces significant financial headwinds, including a substantial net loss and a major collaboration termination, which are concerning. However, the promising early clinical data for PBGENE-HBV and PBGENE-DMD, along with key regulatory designations (RMAT, Fast-Track, Orphan Drug) and a strengthened cash position through a recent capital raise, provide a basis for continued development. The strategic focus on in vivo gene editing and complex edits is a positive, but the long and uncertain path to commercialization for novel gene therapies warrants a cautious "hold" rather than a "buy" or "sell" at this stage. Investors should monitor clinical trial progress and future financing needs closely.

Keywords

Gene editing, ARCUS, Biotechnology, Chronic Hepatitis B, Duchenne Muscular Dystrophy, Rare Pediatric Disease, Orphan Drug, Clinical Trials, In Vivo Gene Therapy, Oncology, Autoimmune Diseases, Intellectual Property, SEC Filing, 10-K, Pharmaceuticals, Drug Development, Genetic Diseases, Viral Elimination, Gene Excision, Gene Insertion, Financial Performance, Capital Raise