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Collaboration and License Agreements | 12 Months Ended
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Dec. 31, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Collaboration and License Agreements | 10. Collaboration and license agreements Eli Lilly and Company In October 2023, the Company entered into a Transfer and Delegation Agreement, or the Lilly Agreement, with Eli Lilly and Company, or Lilly, pursuant to which Lilly acquired certain assets and other rights under the Company’s amended collaboration and license agreement, or the Verve Agreement, with Verve Therapeutics, Inc., or Verve, including the Company’s opt-in rights to co-develop and co-commercialize Verve’s base editing programs for cardiovascular disease (see discussion below related to the Verve Agreement). The Company granted Lilly an exclusive sublicense to the Verve technology originally licensed to the Company under the Verve Agreement. Lilly also acquired the right to receive any future milestone or royalty payments payable by Verve under the Verve Agreement and the rights and obligations to designate representatives and participate on the joint steering committee with Verve. The Company received a $200.0 million nonrefundable upfront payment and is eligible to receive up to $350.0 million in potential future development-stage payments upon the completion of certain clinical, regulatory and alliance events. If Lilly does not opt-in to co-develop and co-commercialize a licensed product, Lilly is obligated to pay the Company a percentage of any royalties received from Verve for sales of such product, subject to certain caps on a licensed product-by-licensed product basis. For a period of six years from the effective date of the Lilly Agreement, Lilly has the right to request the Company to perform any critical research and development services, if Lilly reasonably determines that the Company is uniquely able to provide such services and other conditions are met, including that no other third parties can provide such services. The parties will negotiate an agreement governing the Company’s performance of such activity, if any, and the Company will be compensated for any services at approximately cost plus a margin. The Company has not been requested to perform any services and believes it is remote that Beam would be requested to provide any services. In connection with the Lilly Agreement, the Company and Lilly entered into a Stock Purchase Agreement providing for the sale and issuance of 2,004,811 shares of the Company’s common stock to Lilly for an aggregate purchase price of $50.0 million. The Company received the consideration under the Stock Purchase Agreement of $50.0 million in October and the upfront payment of $200.0 million in November 2023. The Lilly Agreement and Stock Purchase Agreement were negotiated at the same time as a package and have been accounted for as one combined contract. The Company accounts for the component of the arrangement to transfer common stock to Lilly under ASC 505, Equity, and the revenue component under ASC 606, as it includes a customer-vendor relationship as defined under ASC 606 and meets the criteria to be considered a contract. The Company first applied the guidance in ASC 505 to measure the fair value of the common stock issued and allocated the remaining consideration to the ASC 606 component of the arrangement. The overall ASC 606 transaction price as of the inception of the contract was determined to be $216.4 million, which is comprised of the upfront payment of $200.0 million and the residual value of the proceeds received in excess of the fair value of the common stock sold to Lilly of $16.4 million. The fair value of the common stock issued to Lilly was $33.6 million, as determined by management with the assistance of a third-party valuation specialist. There is no variable consideration included in the transaction price at inception. The Company will re-evaluate the transaction price at each reporting period. The Company concluded that the collaboration rights and licenses to intellectual property have the same pattern and timing of transfer and are transferred as of the effective date of the Lilly Agreement. Lilly’s right to request research and development services represents an optional purchase in the agreement that does not constitute a material right. All other items promised to Lilly are immaterial in the context of the agreement. The Company recognized revenue for the performance obligation at a point-in-time in October 2023 as all requirements related to the performance obligation have been completed. Any consideration received related to Lilly’s optional purchase of the Company’s research and development services will be accounted for as a separate contract if and when the option is exercised in accordance with ASC 606. During the year ended December 31, 2024 the Company recognized $25.0 million in revenue related to the achievement of certain clinical, regulatory and alliance events. During the year ended 2023 the Company recognized $216.4 million of revenue related to the Lilly Agreement. As of December 31, 2024, there was no deferred revenue related to the Lilly Agreement. Orbital In September 2022, the Company entered into a License and Research Collaboration Agreement, or the Orbital Agreement, with Orbital Therapeutics, Inc., or Orbital. Under the terms of the Orbital Agreement, the Company will collaborate with Orbital to advance nonviral delivery and ribonucleic acid, or RNA, technology by providing Orbital with certain proprietary materials, a non-exclusive research license to certain RNA technology and nonviral delivery technology controlled by the Company, and by performing research and development support services as outlined in a research plan. The Company also granted Orbital an exploitation license to certain RNA technology and nonviral delivery technology controlled by the Company. The exploitation license is exclusive in the fields of vaccines and certain protein therapeutics and nonexclusive in all other fields other than gene editing and conditioning. The collaboration is managed on an overall basis by a Joint Steering Committee, or JSC, comprised of an equal number of representatives from the Company and Orbital. In exchange for the licenses and services provided by the Company under the Orbital Agreement, the Company received a non-exclusive research license to certain RNA technology and nonviral delivery technology controlled by Orbital, and research and development support services as outlined in a research plan. Orbital also granted the Company an exploitation license to certain RNA technology and nonviral delivery technology controlled by Orbital. The exploitation license is exclusive in the fields of gene editing and conditioning and nonexclusive in all other fields other than vaccines and certain protein therapeutics. The Company also received 75 million shares of Orbital’s common stock at closing. The research plan has a term of three years and can be extended for unspecified periods upon mutual agreement between the Company and Orbital. The exploitation licenses are exclusive for an initial research term of three years, which may be extended for up to two successive one-year periods by mutual agreement between the Company and Orbital. Either party may terminate the licenses granted to it under the Orbital Agreement for convenience on a product-by-product basis at any time by providing 90 days’ prior written notice. The Company accounts for the consideration received under the Orbital Agreement under ASC 606, Revenue from Contracts with Customers, or ASC 606, as it includes a customer-vendor relationship as defined under ASC 606 and meets the criteria to be considered a contract. The overall transaction price as of the inception of the contract was determined to be $25.5 million, which represents the fair value of the Company’s equity interest in Orbital’s common stock at inception. There is no variable consideration included in the transaction price. The Company concluded that the research and exploitation licenses are not distinct from the other promises in the Orbital Agreement, and as such the Company determined that the licenses combined with the research and development services, know-how transfers, committee participation and materials transfer represent a performance obligation. The Company recognizes revenue associated with the Orbital performance obligation over time as it is satisfied during the term of the agreement, which is three years. The Company recognized $8.5 million of revenue during the years ended December 31, 2024 and 2023, respectively, and $2.1 million of revenue during the year ended December 31, 2022. As of December 31, 2024, there was $6.4 million of current deferred revenue related to the Orbital Agreement. Beam does not have a controlling financial interest in Orbital as Beam does not have the power to direct the activities of Orbital. The Company has significant influence over Orbital through its noncontrolling representation on Orbital’s board of directors and the Company’s equity interest in Orbital. Accordingly, the Company does not consolidate the financial statements of Orbital and accounts for its investment using the equity method of accounting. As of the closing date in September 2022, the fair value of the Company’s investment in Orbital was $25.5 million. The fair value of the Orbital common stock was determined by management with the assistance of a third-party valuation specialist. In determining the fair value of the Company’s investment, the valuation specialist used an option pricing model backsolve approach based on Orbital's most recent funding of preferred stock. The valuation requires the input of certain subjective assumptions. The key assumptions used in the option pricing model, which are level 3 inputs, include the anticipated holding period to an exit and liquidity event, the volatility of market participants (68%) and the discount for lack of marketability (43%). At the date of the investment, a basis difference was identified as the carrying value of the Company’s investment in Orbital exceeded the Company’s proportionate share of the underlying net assets in Orbital. The Company concluded that the basis difference was primarily attributable to Orbital’s IPR&D assets. As Orbital did not meet the definition of a business due to substantially all of the estimated fair value of the gross assets being concentrated in the group of similar IPR&D assets, the basis difference attributable to the IPR&D with no alternative future use was immediately expensed as of the date of the investment. The Company’s proportionate share of the basis difference exceeded its carrying value of the equity method investment in Orbital and the equity investment balance was reduced to zero. There is no commitment for the Company to provide financial support to Orbital. The Company recognized a loss of $25.5 million in association with the basis difference charge in the Company’s consolidated statements of operations for the year ended December 31, 2022 and did no t recognize a gain or loss from the equity method investment for the years ended December 31, 2024 and 2023. Pfizer In December 2021, the Company entered into a research collaboration agreement, or the Pfizer Agreement, with Pfizer Inc., or Pfizer, focused on the use of certain of the Company’s base editing technology to develop in vivo therapies for rare genetic diseases of the liver, muscle, and central nervous system. Under the terms of the Pfizer Agreement, the Company will conduct all research activities through development candidate selection for three base editing programs that target specific genes corresponding to specific diseases that are the subject of such programs. Pfizer will have exclusive rights to license each of the three programs at no additional cost, each an Opt-In Right, and will assume responsibility for subsequent development and commercialization. At the end of the Phase 1/2 clinical trials, the Company may elect to enter into a global co-development and co-commercialization agreement with Pfizer with respect to one program licensed under the collaboration for an option exercise fee equal to a percentage of the applicable development costs incurred by Pfizer, or the Participation Election. In the event the Company elects to exercise its Participation Election, upon the payment of its option exercise fee, Pfizer and the Company would share net profits as well as development and commercialization costs in a 65%/35% (Pfizer/Company) split for such program. The research collaboration is managed on an overall basis by a Joint Research Committee, or JRC, formed by an equal number of representatives from the Company and Pfizer. At the inception of the Pfizer Agreement, the Company was entitled to receive a nonrefundable upfront payment of $300.0 million in consideration for the rights granted to Pfizer under the collaboration. Should Pfizer exercise its Opt-In Right for any of the three programs, the Company would be eligible to receive development, regulatory, and commercial milestones of up to $350.0 million per program, for potential total consideration of up to $1.35 billion, plus royalty payments on global net sales for each licensed program, if any. If Pfizer does not exercise its Opt-In Right for a program, the Company’s rights in such program revert to the Company and the Company will be required to pay Pfizer earn-out payments equal to a low single digit percentage of net sales earned on such program for a ten-year period, if any. As the $300.0 million upfront fee was not received by the Company as of December 31, 2021, the Company recorded a collaboration receivable for $300.0 million with a corresponding deferred revenue liability. The Company received the $300.0 million upfront payment in January 2022. During the collaboration term, Pfizer has a one-time option to substitute a disease that is the subject of a specific program with one pre-defined substitute disease. The collaboration has an initial term of four years and may be extended for an additional year on a program-by-program basis. Pfizer may terminate the Pfizer Agreement for convenience on any or all of the programs by providing 90 days’ prior written notice. The Company accounts for the Pfizer Agreement under ASC 606, as it includes a customer-vendor relationship as defined under ASC 606 and meets the criteria to be considered a contract. The overall transaction price as of the inception of the contract was determined to be $300.0 million, which is comprised entirely of the nonrefundable upfront payment. There is no variable consideration included in the transaction price at inception as the future milestone payments are fully constrained and the Company is not required to estimate variable consideration for the royalty payments at contract inception. The Company will re-evaluate the transaction price in each reporting period. The Company has concluded that the licenses to its base editing technology, including the exclusive development and commercialization rights, are not capable of being distinct from the other performance obligations, and as such the Company has determined that the licenses combined with the other research and development services represent performance obligations and no up-front revenue was recognized for the licenses. The selling price of each performance obligation was determined based on the Company’s estimated standalone selling price, or the ESSP. The Company developed the ESSP for all of the performance obligations included in the Pfizer Agreement by determining the total estimated costs to fulfill each performance obligation identified with the objective of determining the price at which it would sell such an item if it were to be sold regularly on a standalone basis. The Company allocated the stand-alone selling price to the performance obligations based on the relative standalone selling price method. The Company recognizes revenue for each performance obligation as it is satisfied during the term of the agreement using an input method. The Company allocated the transaction price of $300.0 million to each of the three performance obligations, which includes each of the three base editing programs combined with the research and development services, licenses, and exclusive development and commercialization rights. Revenue is recognized using an input method based on the actual costs incurred as a percentage of total estimated costs tow ards satisfying the performance obligation as this method provides the most faithful depiction of the entity’s performance in transferring control of the goods and services promised to Pfizer and represents the Company’s best estimate of the period of the obligation. The impact on revenue of changes in total estimated costs are recognized on a cumulative basis in the period that the change occurs. If estimates of the total cost change, or if contract amendments change the scope of the performance obligation, the required adjustments to revenue could be material. The Company recognized $8.4 million, $134.3 million and $48.2 million of revenue under the Pfizer Agreement, during the years ended December 31, 2024, 2023 and 2022, respectively. As of December 31, 2024, there was $88.5 million and $20.6 million of current and long-term deferred revenue, respectively, related to the Pfizer Agreement. Sana Biotechnology In October 2021, the Company entered into an option and license agreement, or the Sana Agreement, with Sana Biotechnology, Inc., or Sana, under which the Company granted Sana a license for non-exclusive rights to its CRISPR Cas12b nuclease system for the development and commercialization of certain engineered cellular therapy programs. In addition to the license, the Company performed an initial technology transfer following the effective date of the Sana Agreement providing Sana with certain know-how, as required under the Sana Agreement. This technology transfer occurred in 2021. Following the license transfer and completion of the initial technology transfer, Sana is responsible, at its sole expense, for the development and commercialization of therapeutic products which must contain either specified CAR antigen targets or pluripotent stem cell, or PSC, product types. As consideration for the license, the Company received an upfront payment of $50.0 million from Sana in October 2021. In addition, the Company may be eligible to receive development, regulatory, and commercial milestones of up to $65.0 million from Sana on any product candidate or product. The Company will also be entitled to receive royalties equal to a low single digit percentage of net sales on any product. For up to forty-two months following the effective date of the Sana Agreement, Sana has the option to select up to a cumulative total of two additional CAR antigen targets or PSC product types for an additional fee of $15.0 million per additional CAR antigen target and additional PSC product type, or the Option Rights, for an aggregate potential additional consideration of $30.0 million. Further, for up to thirty months following the effective date of the Sana Agreement, Sana has a one-time right to substitute, in the aggregate, either one CAR antigen target or one PSC product type at no additional cost, or the Replacement Right. Sana may also select a specified number of additional or replacement genetic targets for each PSC product type at any time prior to the third anniversary of the effective date at no additional cost, or the Genetic Target Nomination Rights. Sana may terminate the Sana Agreement for convenience prior to the first commercial sale of any licensed product by providing 90 days’ prior written notice or upon 180 days’ prior written notice after first commercial sale. The Company accounts for the Sana Agreement under ASC 606 as it includes a customer-vendor relationship as defined under ASC 606 and meets the criteria to be considered a contract. The overall transaction price as of the inception of the contract was determined to be $50.0 million, which is composed entirely of the nonrefundable upfront payment. There is no variable consideration included in the transaction price at inception as the future milestone payments are fully constrained and the Company is not required to estimate variable consideration for the royalty payments at contract inception. The Company will re-evaluate the transaction price in each reporting period. The Company has identified a single performance obligation, which includes (i) the non-exclusive license granted to Sana under the Company’s patent rights and know-how and (ii) the initial technology transfer following the effective date, which occurred in 2021. The Company further concluded that the Option Rights, Replacement Right, and Genetic Target Nomination Rights did not grant Sana a material right. As the Company only identified one performance obligation, no allocation of the transaction price is required. The Company recognized $2.0 million of revenue under the Sana Agreement during the year ended December 31, 2024 and $1.8 million of revenue under the Sana Agreement during the year ended December 31, 2023. The Company did no t recognize any revenue under the Sana Agreement for the year ended December 31, 2022. Apellis Pharmaceuticals In June 2021, the Company entered into a research collaboration agreement, or the Apellis Agreement, with Apellis Pharmaceuticals, Inc., or Apellis, focused on the use of certain of the Company’s base editing technology to discover new treatments for complement system-driven diseases. Under the terms of the Apellis Agreement, the Company will conduct preclinical research on up to six base editing programs that target specific genes within the complement system in various organs, including the eye, liver, and brain. Apellis has an exclusive option to license any or all of the six programs, or in each case, an Opt-In Right, and will assume responsibility for subsequent development. The Company may elect to enter into a 50-50 U.S. co-development and co-commercialization agreement with Apellis with respect to one program instead of a license. The collaboration is managed on an overall basis by an alliance steering committee formed by an equal number of representatives from the Company and Apellis. As part of the collaboration, the Company is eligible to receive a total of $75.0 million in upfront and near-term milestones from Apellis, which is comprised of $50.0 million received upon signing and an additional $25.0 million payment on June 30, 2022, the one-year anniversary of the effective date of the Apellis Agreement, or the First Anniversary Payment. Following any exercise of an Opt-In Right for any of the six programs, the Company will be eligible to receive development, regulatory, and sales milestones from Apellis, as well as royalty payments on sales. The collaboration has an initial term of five years and may be extended up to two years on a per year and program-by-program basis. During the collaboration term, Apellis may, subject to certain limitations, substitute a specific complement gene and/or organ for any of the initial base editing programs. Apellis may terminate the Apellis Agreement for convenience on any or all of the programs by providing prior written notice. The Company received the $50.0 million upfront payment from Apellis in July 2021 and the $25.0 million First Anniversary Payment in June 2022. The Company accounts for the Apellis Agreement under ASC 606 as it includes a customer-vendor relationship as defined under ASC 606 and meets the criteria to be considered a contract. The overall transaction price as of the inception of the contract was determined to be $75.0 million, which is composed of the upfront payment of $50.0 million and the First Anniversary Payment of $25.0 million. The Company will re-evaluate the transaction price in each reporting period. The Company concluded that each of the six base editing programs combined with the research and development service, licenses, substitution rights and governance participation were material promises that were both capable of being distinct and were distinct within the context of the Apellis Agreement and represented separate performance obligations. Therefore, the Company did no t recognize any upfront revenue related to the license. The Company further concluded that the Opt-In Rights and option to extend the collaboration term did not grant Apellis a material right. The Company determined that the term of the contract is five years, as this is the period during which both parties have enforceable rights. The selling price of each performance obligation was determined based on the Company’s estimated standalone selling price, or the ESSP. The Company developed the ESSP for all of the performance obligations included in the Apellis Agreement by determining the total estimated costs to fulfill each performance obligation identified with the objective of determining the price at which it would sell such an item if it were to be sold regularly on a standalone basis. The Company allocated the stand-alone selling price to the performance obligations based on the relative standalone selling price method. The Company recognizes revenue for each performance obligation as it is satisfied over the five-year term using an input method. The Company allocated the transaction price of $75.0 million to each of the six performance obligations, which includes each of the six base editing programs combined with the research and development service, licenses, substitution rights and governance participation, and is being recognized using an input method based on the actual costs incurred as a percentage of total budgeted costs towards satisfying the performance obligation as this method provides the most faithful depiction of the entity’s performance in transferring control of the goods and services promised to Apellis and represents the Company’s best estimate of the period of the obligation. For the years ended December 31, 2024, 2023, and 2022, the Company recognized $19.7 million, $16.4 million and $10.6 million of revenue, respectively, related to the Apellis Agreement. As of December 31, 2024, there is $14.0 million and $12.6 million of current and long-term deferred revenue, respectively, related to the Apellis Agreement. Verve In April 2019, the Company entered into a collaboration and license agreement with Verve, or the Verve Agreement, to investigate gene editing strategies to modify genes associated with an increased risk of coronary diseases and in July 2022, the Company and Verve amended the Verve Agreement. Under the terms of the Verve Agreement, as amended, the Company granted Verve an exclusive license to certain base editor technology and improvements and Verve granted the Company a non-exclusive license under certain know-how and patents controlled by Verve, an interest in joint collaboration technology and a non-exclusive license under certain delivery technology. In connection with the Verve Agreement, Verve issued the Company 2.6 million shares of its common stock as partial consideration for the licenses granted, having a fair value of $0.5 million. The fair value of the Verve common stock was determined by management with the assistance of a third-party valuation specialist. In addition, to the extent certain clinical, regulatory, and commercial milestones were met with respect to licensed products, Verve was required to pay to the Company certain amounts, as defined in the agreement. Lastly, to the extent there were sales of a licensed product, Verve was obligated to pay the Company royalties, as defined in the agreement. The Company also purchased shares of Verve's Series A preferred stock during the year ended December 31, 2020. During June 2021, Verve completed an initial public offering of its common stock. In connection with Verve’s initial public offering, Verve effected a one-for-9.2592 reverse stock split and also converted all shares of its preferred stock into shares of common stock. As of December 31, 2024, the Company owned 546,970 shares of Verve's common stock valued at $3.1 million. Management determined that the performance obligations associated with the Verve Agreement were the combined licenses and improvements related to the licensed technology. All other items promised to Verve were immaterial in the context of the agreement. The fair value of the shares issued by Verve to the Company were considered a fixed upfront payment of $0.5 million in the form of non-cash consideration. In October 2023, the Company, Verve, and Lilly entered into a Side Letter Agreement whereby the Company agreed to delegate to Lilly certain rights and obligations existing under the Verve Agreement, including the Company’s rights and obligations to co-develop and co-commercialize opt-in products, the financial rights to milestone and royalty payments, and the right to participate on certain joint decision-making committees. The Company determined that the transfer and delegation of rights represents a modification of the Verve Agreement to be accounted for as if it were part of the existing contract in accordance with ASC 606. Prior to the modification, the Company determined that its performance obligations associated with the Verve Agreement at contract inception and subsequent modifications were not distinct and represented a single performance obligation, and that the obligation would be completed over the performance period of the agreement. Accordingly, the upfront payment was being recognized as revenue using a time-based proportional performance model over the contract term (April 2019 through 2038) of the collaboration, as license revenue. The milestone payments and royalties were considered variable consideration and were constrained up until the modification date as no milestones or royalties were achieved. Subsequent to the modification, management concluded that the Company does not have material ongoing obligations to Verve in the arrangement and that the remaining revenue under the agreement should be recognized at a point-in-time upon modification. Therefore, the Company recognized the remaining $0.3 of unrecognized revenue in October 2023. The Company did no t recognize any revenue under the Verve Agreement during the year ended December 31, 2024 and has no remaining deferred revenue related to the Verve Agreement as of December 31, 2024. For each of the years ended December 31, 2023 and 2022, the Company recognized approximately $0.4 million and less than $0.1 million of license revenue, respectively.

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- Definition The entire disclosure for collaborative arrangements in which the entity is a participant, including a) information about the nature and purpose of such arrangements; b) its rights and obligations thereunder; c) the accounting policy for collaborative arrangements; and d) the income statement classification and amounts attributable to transactions arising from the collaborative arrangement between participants. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -SubTopic 10 -Topic 808 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479402/808-10-50-1 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (b) -SubTopic 10 -Topic 808 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479402/808-10-50-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Topic 808 -Publisher FASB -URI https://asc.fasb.org/808/tableOfContent + Details
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