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MAJOR CUSTOMERS, PARTNERSHIPS AND STRATEGIC ALLIANCES | 9 Months Ended
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Sep. 30, 2025
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
MAJOR CUSTOMERS, PARTNERSHIPS AND STRATEGIC ALLIANCES | MAJOR CUSTOMERS, PARTNERSHIPS AND STRATEGIC ALLIANCES Eli Lilly and Company In April 2025, the Company entered into a global capsid delivery license agreement (the “Lilly Agreement”) with Eli Lilly and Company (“Lilly”) to develop intravenously administered genomic medicines to treat certain diseases of the CNS. Under the Lilly Agreement, the Company granted Lilly a worldwide exclusive license to utilize Company’s proprietary, neurotropic adeno-associated virus capsid, STAC-BBB, for one target, with the rights for Lilly to add up to four additional targets during a defined target selection period after paying additional licensed target fees. Under the Lilly Agreement, the Company received an $18.0 million upfront license payment in April 2025. The Company completed the technology transfer with respect to the initial target and indication in April 2025, and Lilly is solely responsible for all preclinical and clinical development, regulatory interactions, manufacturing and global commercialization of resulting products. The Company is eligible to earn up to $1.4 billion in additional licensed target fees and milestone payments across the five potential CNS disease targets under the Lilly Agreement, including a license fee for each additional licensed target. In addition, the Company is entitled to receive escalating, tiered mid-single digit to high-single digit royalty payments on the net sales of products sold under these licenses, subject to adjustments for patent expiration, entry of biosimilar or interchangeable products to the market, pricing regulation, and payments made under certain licenses for third-party intellectual property. The Lilly Agreement will continue, on a product-by-product and country-by-country basis, until the date when there is no remaining royalty payment obligation in such country with respect to such product, at which time the Lilly Agreement will expire with respect to such product in such country. Royalty obligations cease upon the latest of expiration of certain regulatory exclusivities in such country, the last expiration of certain valid patent claims covering such product in such country or ten years from the date of the first commercial sale of the first product in such country. Lilly has the right to terminate the Lilly Agreement for convenience. Each party has the right to terminate the Lilly Agreement for other party’s uncured material breach and for specified bankruptcy events. The Company assessed the agreement with Lilly in accordance with ASC Topic 606 and concluded that Lilly is a customer. The initial transaction price includes the upfront license fee of $18.0 million. None of the research or development milestones have been included in the transaction price, as all such amounts are fully constrained. As part of its evaluation of the constraint, the Company considered numerous factors, including the fact that achievement of the milestones at this time is uncertain and contingent upon successful continuation of research and development activities in future periods. The Company will re-evaluate the transaction price at each reporting date, as certain events are resolved or other changes in circumstances occur. Potential sales-based milestones and royalty payments are not estimated as they meet the sales-or usage-based royalty exception under ASC Topic 606 and are recognized in the period they are earned, provided the related performance obligations have been completed. The Company has determined that Lilly’s exercise of the options to add additional targets would result in the grant of separate licenses from the license to the initial target. The Company determined that the options to add additional targets are not material rights, and the exercise of each option will be accounted for as a separate revenue contract. Accordingly, the initial contract contains only a single performance obligation to provide functional intellectual property in the form of a license to the initial target, and the full transaction price of $18.0 million was recognized during the nine months ended September 30, 2025 upon grant of the license and completion of the technology transfer. No revenue was recognized during the three months ended September 30, 2025. As of September 30, 2025, the Company had no receivable, no deferred revenue, and no amounts currently included in transaction price remaining to be recognized related to the agreement. Astellas Gene Therapies, Inc. In December 2024, the Company entered into a global capsid delivery license agreement with Astellas Gene Therapies, Inc. (“Astellas”), or the Astellas Agreement. Under the terms of the Astellas Agreement, the Company granted an exclusive license to Astellas to the Company’s proprietary, neurotropic adeno-associated virus capsid, STAC-BBB, for use with therapies directed to an initial neurodevelopmental target and up to four additional targets and for up to three indications per target. In addition, Astellas has a potential right to exchange its license to the STAC-BBB capsid for a license to another capsid. This substitution right may be exercised twice during the initial three-year period of the Astellas Agreement and is subject to the availability of a substitute capsid at the time the request is made. The Company is prohibited from exploiting (for itself or with or for a third party) products directed to the initial target, any reserved targets, and any additional licensed targets under the Astellas Agreement for licensed or reserved indications during the applicable exclusivity periods set forth in the Astellas Agreement. The Company completed the technology transfer with respect to the initial target and indication in December 2024, and Astellas is solely responsible for all preclinical and clinical development, regulatory interactions, manufacturing and global commercialization of resulting products. In December 2024, the Company received a $20.0 million upfront license payment from Astellas under the Astellas Agreement. Under the terms of the Astellas Agreement, the Company is also eligible to earn up to $1.3 billion in license fees and research, development and commercial milestones across up to five potential targets, including a license fee for each additional licensed target. In addition, the Company is also entitled to receive escalating, tiered mid-single digit to high-single digit royalty payments on the net sales of products sold under these licenses, subject to adjustments for patent expiration, entry of biosimilar or interchangeable products to the market and payments made under certain licenses for third-party intellectual property. The Astellas Agreement will continue, on a product-by-product and country-by-country basis, until the date when there is no remaining royalty payment obligation in such country with respect to such product, at which time the Astellas Agreement will expire with respect to such product in such country. Royalty obligations cease upon the latest of expiration of regulatory exclusivity for such product in such country, the last expiration of certain valid patent claims covering such product in such country or ten years from the date of the first commercial sale of such product in such country. Astellas has the right to terminate the Astellas Agreement for convenience. Each party has the right to terminate the Astellas Agreement for other party’s uncured material breach and for specified bankruptcy events. The Company also has the right to terminate the Astellas Agreement if Astellas challenges any of the Company’s licensed patents under the Astellas Agreement. The Company assessed the agreement with Astellas in accordance with ASC Topic 606 and concluded that Astellas is a customer. The initial transaction price includes the upfront license fee of $20.0 million. None of the research or development milestones have been included in the transaction price, as all such amounts are fully constrained. As part of its evaluation of the constraint, the Company considered numerous factors, including the fact that achievement of the milestones at this time is uncertain and contingent upon successful continuation of research and development activities in future periods. The Company will re-evaluate the transaction price at each reporting date, as certain events are resolved or other changes in circumstances occur. Potential sales-based milestones and royalty payments are not estimated as they meet the sales-or usage-based royalty exception under ASC Topic 606 and are recognized in the period they are earned, provided the related performance obligations have been completed. The Company has determined that Astellas’ option to add additional targets and indications would result in the grant of separate licenses from the license to the initial target and indication. Rights to these optional licenses can be acquired by Astellas at a discount from their standalone selling price, and accordingly, represent material rights granted to Astellas. Both the initial and any optional licenses are distinct and license Astellas to use functional intellectual property. Accordingly, they would be recognized at a point in time when granted, provided Astellas has received a copy of the associated intellectual property. Optional licenses will not be recognized until exercise of the underlying option or until expiration of the option. The Company allocated the initial transaction price to the performance obligations based on the relative standalone selling price of each performance obligation. In the absence of observable prices, the Company used a methodology that maximized the use of observable inputs. The Company took into consideration the total amounts paid and potentially payable by Astellas and potential market for each license. In addition, included in the estimates of the standalone selling prices of the options with material rights were the implied level of discount and the probability of the option exercise. Of the transaction price of $20.0 million, $6.5 million was allocated to the initial license, and $13.5 million to the options for additional licensed targets. The initial license was transferred upon completion of the technology transfer in December 2024, and the associated amount of $6.5 million recognized in revenue at that time. As of September 30, 2025, the Company had deferred revenue of $13.5 million related to the options with material rights, of which $7.6 million is classified as current based on the contractually required timing of exercise or expiration of the underlying options within the next four years. The remaining $5.9 million is classified as non-current. There were no revenues recognized under the agreement during the three and nine months ended September 30, 2025 and 2024. Genentech, Inc. In August 2024, the Company entered into a global epigenetic regulation and capsid delivery license agreement with Genentech, Inc., a member of the Roche Group (“Genentech”) to develop intravenously administered genomic medicines to treat certain neurodegenerative diseases. Under the terms of the agreement, the Company granted an exclusive license to Genentech for the Company’s proprietary zinc finger repressors (“ZFRs”) that are directed to tau and a second undisclosed neurology target. The Company also granted an exclusive license to Genentech to the Company’s proprietary, neurotropic adeno-associated virus capsid, STAC-BBB, for use with therapies directed to tau and to the second neurology target. The Company is prohibited from exploiting (for itself or with or for a third party) products directed to tau and to the second neurology target during the applicable exclusivity periods set forth in the agreement. The Company was responsible for completing the technology transfer and certain preclinical activities, and Genentech is solely responsible for all clinical development, regulatory interactions, manufacturing and global commercialization of resulting products. In August 2024, the Company received a $40.0 million upfront license payment from Genentech. In October 2024, the Company received a $10.0 million milestone payment related to the technology transfer. Under the terms of the agreement, the Company is also eligible to earn up to $1.9 billion in development and commercial milestones spread across multiple potential products. In addition, the Company is also entitled to receive escalating, tiered mid-single digit to sub-teen double digit royalty payments on the net sales of such products, subject to adjustments for patent expiration, entry of competitive products to the market and payments made under certain licenses for third-party intellectual property. The agreement will continue, on a product-by-product and country-by-country basis, until the date when there is no remaining royalty payment obligation in such country with respect to such product, at which time the agreement will expire with respect to such product in such country. Royalty obligations cease upon the later of expiry of the last valid patent claim covering the product in the country or ten years from the date of the first commercial sale of the product in such country. Genentech has the right to terminate the agreement for convenience. Each party has the right to terminate the agreement on account of the other party’s uncured material breach. The Company assessed the agreement with Genentech in accordance with ASC Topic 606 and concluded that Genentech is a customer. The initial transaction price of $50.0 million includes the upfront license fee of $40.0 million and the $10.0 million technology transfer milestone payment. None of the development milestones have been included in the transaction price, as all such amounts are fully constrained. As part of its evaluation of the constraint, the Company considered numerous factors, including the fact that achievement of the milestones at this time is uncertain and contingent upon future periods when the uncertainty related to the variable consideration is resolved. The Company will re-evaluate the transaction price as uncertain events are resolved or other changes in circumstances occur. Potential sales-based milestones and royalty payments are not estimated as they meet the sales-or usage-based royalty exception under ASC Topic 606 and are recognized in the period they are earned, provided the related performance obligations have been completed. The Company has identified two performance obligations within the Genentech Agreement. All licenses were accounted for as a performance obligation to provide functional intellectual property that is satisfied at a point in time that was satisfied upon completion of the technology transfer in September 2024. The preclinical activities represent research and development services and are satisfied over time as the Company conducts and Genentech benefits from the associated activities. Revenue related to the preclinical activities is recognized using an input method of cumulative actual costs incurred relative to total estimated costs. The Company allocated the initial transaction price to the performance obligations based on the relative standalone selling price of each performance obligation. In the absence of an observable standalone selling price, the Company used a methodology that maximized the use of observable inputs. This included a cost plus margin approach for the preclinical activities, which required the estimation of total costs and an expected margin. The standalone selling price of the licenses was determined based on the analysis of the probability-adjusted discounted cash flows and potential sales of licensed products. Significant estimates and assumptions were used that include but are not limited to, expected market opportunity and pricing, timelines, and likelihood of success of clinical, regulatory and commercialization activities. The Company expects to allocate variable consideration payable upon achievement of future milestones and royalty payments to the specific performance obligation to which they relate, i.e. the license performance obligation, as such allocation would meet the allocation objective in ASC Topic 606. As of September 30, 2025, the Company had no receivable, no deferred revenue, and no amounts included in transaction price remaining to be recognized related to the agreement. Revenues recognized under the agreement were as follows (in thousands):
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Revenue related to Genentech agreement: |  |  |  |  |  |  |
Recognition of license revenue | $ | — |  |  | $ | 48,679 |  |  | $ | — |  |  | $ | 48,679 |
Research services | — |  |  | 547 |  |  | — |  |  | 547 |
Total | $ | — |  |  | $ | 49,226 |  |  | $ | — |  |  | $ | 49,226 |
Pfizer Inc. In May 2017, the Company entered into an exclusive global collaboration and license agreement with Pfizer Inc. (“Pfizer”), pursuant to which it established a collaboration for the research, development and commercialization of giroctocogene fitelparvovec, its gene therapy product candidate for hemophilia A, and closely related products. In December 2024, Pfizer notified the Company of its termination for convenience, effective April 21, 2025 (the “Pfizer Termination Date”), of the collaboration agreement. Pfizer had indicated to Sangamo that the termination relates to its decision not to submit a Biologics License Application or Marketing Authorization Application for, or pursue commercialization of, giroctocogene fitelparvovec. The Company accounted for the notice of termination of the agreement by Pfizer as a modification in accordance with ASC Topic 606. As of the Pfizer Termination Date, the collaboration agreement terminated pursuant to the terms of the collaboration agreement. Sangamo is entitled to receive from Pfizer an exclusive, worldwide, royalty-bearing, sublicensable license from Pfizer to use Pfizer’s relevant intellectual property to continue developing, manufacturing and commercializing giroctocogene fitelparvovec; in return, Pfizer would be eligible to receive single digit royalties on net sales of giroctocogene fitelparvovec and would be released from certain liabilities to the extent they exist. Under this agreement, the Company was responsible for conducting the Phase 1/2 clinical trial and for certain manufacturing activities for giroctocogene fitelparvovec, while Pfizer was responsible for subsequent worldwide development, manufacturing, marketing and commercialization of giroctocogene fitelparvovec. Subject to the terms of the agreement, the Company granted Pfizer an exclusive worldwide royalty-bearing license, with the right to grant sublicenses, to use certain technology controlled by the Company for the purpose of developing, manufacturing and commercializing giroctocogene fitelparvovec and related products. Pfizer granted the Company a non-exclusive, worldwide, royalty-free, fully paid license, with the right to grant sublicenses, to use certain manufacturing technology developed under the agreement and controlled by Pfizer to manufacture the Company’s products that utilize the AAV delivery system. The agreement had a term that continued on a per product and per country basis until the later of (i) the expiration of patent claims that cover the product in a country, (ii) the expiration of regulatory exclusivity for a product in a country, and (iii) 15 years after the first commercial sale of a product in a country. Pfizer had the right to terminate the agreement without cause in its entirety or on a per product or per country basis. The agreement could also be terminated by either party based on an uncured material breach by the other party or the bankruptcy of the other party. Upon termination for any reason, the license granted by the Company to Pfizer to develop, manufacture and commercialize giroctocogene fitelparvovec and related products automatically terminates. Upon termination by the Company for cause or by Pfizer in any country or countries, Pfizer will automatically grant the Company an exclusive, royalty-bearing license under certain technology controlled by Pfizer to develop, manufacture and commercialize giroctocogene fitelparvovec in the terminated country or countries. Upon execution of the agreement, the Company received an upfront fee of $70.0 million and was eligible to receive up to $208.5 million in payments upon the achievement of specified clinical development, intellectual property and regulatory milestones and up to $266.5 million in payments upon first commercial sale milestones for giroctocogene fitelparvovec and potentially other products. To date, two milestones of $55.0 million in aggregate had been achieved and paid. In addition, Pfizer had agreed to pay the Company royalties for each potential licensed product developed under the agreement that are 14% - 20% of the annual worldwide net sales of such product and are subject to reduction due to patent expiration, entry of biosimilar products to the market and payment made under certain licenses for third-party intellectual property. The Company assessed the agreement with Pfizer in accordance with ASC Topic 606 and concluded that Pfizer was a customer. The Company completed its performance obligations and recognized the amounts included in the transaction price of $134.0 million during the periods through December 31, 2020. Following the receipt of the termination notice, the Company was entitled to receive $5.0 million payable 60 days after the effective date of the termination, unless the Company transferred a specified sublicense to Pfizer, prior to termination, in which case it was payable 30 days after such transfer. Sangamo transferred the specified sublicense to Pfizer and recognized the $5.0 million in revenue during the nine months ended September 30, 2025. No revenue was recognized during the three months ended September 30, 2025. Pfizer will not be obligated to pay the Company the remaining milestone payments and royalties. The Company and Pfizer continue to work together on managing the transition of their collaboration, which terminated on April 21, 2025. No revenue was recognized under the agreement during the three and nine months ended September 30, 2024. Alexion Pharmaceuticals, Inc., AstraZeneca Rare Disease In December 2017, the Company entered into an exclusive, global collaboration and license agreement with Pfizer, subsequently assigned to Alexion, AstraZeneca Rare Disease (“Alexion”) in September 2023, for the development and commercialization of potential gene therapy products that use zinc finger transcriptional regulators (“ZF-transcriptional regulators”) to treat amyotrophic lateral sclerosis and frontotemporal lobar degeneration linked to mutations of the C9ORF72 gene. Pursuant to this agreement, the Company agreed to work with Pfizer on a research program to identify, characterize and preclinically develop ZF-transcriptional regulators that bind to and specifically reduce expression of the mutant form of the C9ORF72 gene. Subject to the terms of this agreement, the Company granted Pfizer (now Alexion) an exclusive, royalty-bearing, worldwide license under the Company’s relevant patents and know-how to develop, manufacture and commercialize gene therapy products that use resulting ZF-transcriptional regulators that satisfy pre-agreed criteria. During a specified period, neither the Company nor Alexion will be permitted to research, develop, manufacture or commercialize outside of the collaboration any zinc finger proteins (“ZFPs”) that specifically bind to the C9ORF72 gene. Unless earlier terminated, the agreement has a term that continues on a per licensed product and per country basis until the later of (i) the expiration of patent claims that cover the licensed product in a country, (ii) the expiration of regulatory exclusivity for a licensed product in a country, and (iii) 15 years after the first commercial sale of a licensed product in a major market country. Alexion also has the right to terminate the agreement without cause in its entirety or on a per product or per country basis. The agreement may also be terminated by either party based on an uncured material breach by the other party or the bankruptcy of the other party. Upon termination for any reason, the license granted by the Company to Alexion to develop, manufacture and commercialize licensed products under the agreement would automatically terminate. Upon termination by the Company for cause or by Alexion without cause for any licensed product or licensed products in any country or countries, the Company would have the right to negotiate with Alexion to obtain a non-exclusive, royalty-bearing license under certain technology controlled by Alexion to develop, manufacture and commercialize the licensed product or licensed products in the terminated country or countries. Following any termination by the Company for Alexion’s material breach, Alexion would not be permitted to research, develop, manufacture or commercialize ZFPs that specifically bind to the C9ORF72 gene for a period of time. Following any termination by Alexion for the Company’s material breach, the Company would not be permitted to research, develop, manufacture or commercialize ZFPs that specifically bind to the C9ORF72 gene for a period of time. The Company received a $12.0 million upfront payment from Pfizer and is eligible to receive up to $60.0 million in development milestone payments from Alexion contingent on the achievement of specified preclinical development, clinical development and first commercial sale milestones, and up to $90.0 million in commercial milestone payments if annual worldwide net sales of the licensed products reach specified levels. In addition, Alexion will pay the Company royalties of 14% - 20% of the annual worldwide net sales of the licensed products. These royalty payments are subject to reduction due to patent expiration, entry of biosimilar products to the market and payments made under certain licenses for third-party intellectual property. Each party is responsible for the cost of its performance of the research program. Alexion is operationally and financially responsible for subsequent development, manufacturing and commercialization of the licensed products. To date, a milestone of $5.0 million has been earned and paid, however no products have been approved and therefore no royalty fees have been earned under the C9ORF72 agreement. The Company assessed the agreement with Alexion in accordance with ASC Topic 606 and concluded that Alexion is a customer. The Company completed its performance obligations and recognized the amounts included in the transaction price of $17.0 million during the periods through December 31, 2020. No revenue was recognized during the three and nine months ended September 30, 2025 and 2024. The remaining development milestone amounts have not been included in the transaction price and have not been recognized as their achievement is dependent on the progress and outcomes of Alexion’s development activities and is therefore uncertain. If and when these milestones become probable of being achieved, they would be recognized in full at that time. Sales related milestones and royalties are not recognized until triggered based on the contractual terms. In October 2023, Pfizer notified the Company of Pfizer’s assignment of the collaboration and license agreement to Alexion, AstraZeneca Rare Disease, pursuant to a definitive purchase and license agreement for preclinical gene therapy assets and enabling technologies that closed on September 20, 2023.

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