Overview of Financial Performance

Precigen, a biotechnology company focused on developing innovative gene and cell therapies, reported its financial results for the year ended December 31, 2024. The company has faced a challenging year, with a net loss of $126.2 million, up from a net loss of $95.9 million in 2023. This increase in losses was driven by several factors, including impairment charges related to the suspension of operations at the company’s ActoBio subsidiary and continued investment in the development of its lead program, PRGN-2012.

Despite these setbacks, Precigen made important progress in 2024, including the completion of a rolling submission for a Biologics License Application (BLA) to the FDA for PRGN-2012 for the treatment of recurrent respiratory papillomatosis (RRP). The FDA has accepted the BLA and granted priority review, with a target action date set for August 2025. This represents a significant milestone for the company as it works towards the potential commercialization of its first product.

Revenue and Profit Trends

Precigen’s primary revenues continue to come from its Exemplar reporting segment, which generates product and service revenues through the development and sale of genetically engineered miniature swine models. In 2024, Exemplar revenues decreased by 36.6% to $3.9 million, down from $6.1 million in 2023, due to a reduction in products sold and services performed.

The company’s Biopharmaceuticals segment, which was previously focused on developing preclinical and clinical programs in immuno-oncology, autoimmune disorders, and infectious diseases, saw a 100% decline in collaboration and licensing revenues in 2024 due to the termination of a license agreement with Alaunos.

Precigen’s overall operating expenses increased by 31.1% to $139.0 million in 2024, up from $106.0 million in 2023. This was driven by a 9.2% increase in research and development expenses, primarily related to the PRGN-2012 program, as well as $40.3 million in impairment charges associated with the suspension of ActoBio’s operations and the Exemplar reporting segment.

The company’s Segment Adjusted EBITDA, a key measure of performance, showed a decline in both the Biopharmaceuticals (-$82.3 million) and Exemplar (-$0.9 million) segments compared to the prior year. This reflects the increased investment in PRGN-2012 development and the reduced revenues at Exemplar.

Strengths and Weaknesses

One of Precigen’s key strengths is its focus on the development of PRGN-2012, its lead gene therapy program for the treatment of RRP. The successful completion of the BLA submission and the FDA’s acceptance with priority review are important steps towards potential commercialization. If approved, PRGN-2012 could provide a much-needed treatment option for patients with this rare and debilitating condition.

However, the company’s reliance on Exemplar as its primary source of revenue is a weakness, as demonstrated by the decline in Exemplar’s performance in 2024. The suspension of the UltraCAR-T clinical programs and the impairment charges related to ActoBio also highlight the challenges Precigen has faced in advancing its broader pipeline of product candidates.

Another weakness is Precigen’s ongoing financial challenges, as evidenced by its significant net losses and the need to raise additional capital to fund its operations. The company’s ability to continue as a going concern is dependent on the successful commercialization of PRGN-2012 and its ability to secure additional financing, which introduces uncertainty and risk.

Outlook and Future Prospects

Precigen’s immediate focus is on the potential approval and commercialization of PRGN-2012 for the treatment of RRP. The FDA’s acceptance of the BLA with priority review is a positive sign, and if approved, PRGN-2012 could provide a much-needed treatment option for patients and generate revenue for the company.

However, the company’s long-term success will depend on its ability to diversify its revenue streams and advance its broader pipeline of product candidates. The suspension of the UltraCAR-T programs and the impairment charges related to ActoBio highlight the challenges the company has faced in developing its earlier-stage programs.

To address these challenges, Precigen has implemented a strategic prioritization of its pipeline, focusing on the development of PRGN-2012 and minimizing spending on other programs. The company has also reduced its workforce and is exploring strategic partnerships to further advance its UltraCAR-T programs.

Precigen’s ability to execute on its strategic plan and secure additional financing will be critical to its future success. The company’s going concern status and the need for additional capital raise concerns about its long-term viability, and investors will be closely watching the company’s progress in the coming year.

Overall, Precigen’s financial performance in 2024 reflects the challenges the company has faced, but the potential approval and commercialization of PRGN-2012 could provide a path forward. The company’s ability to diversify its revenue streams and advance its pipeline will be key to its long-term success.