Quarterly Report for Quarter Ending September 30, 2024 (Form 10-Q)

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1. Nature of the Business and Basis of Presentation

Seres Therapeutics, Inc. (the "Company") was incorporated under the laws of the State ofDelawarein October 2010under the name Newco LS21, Inc. In October 2011, the Company changed its name to Seres Health, Inc., and in May 2015, the Company changed its name to Seres Therapeutics, Inc. The Company is a clinical-stage company focused on improving patient outcomes in medically vulnerable populations through novel live biotherapeutics. The Company led the successful development and approval of VOWST (previously referred to as SER-109), the first FDA-approved orally administered microbiome therapeutic, which was sold to Nestlé Health Science (as defined below) in September 2024. The Company is progressing the development of SER-155, an investigational, oral, live biotherapeutic designed to decolonize gastrointestinal ("GI") pathogens, improve epithelial barrier integrity, and induce immune tolerance to prevent bacterial bloodstream and antimicrobial resistant ("AMR") infections as well as other pathogen-associated negative clinical outcomes in patients undergoing allogeneic hematopoietic stem cell transplantation ("allo-HSCT"). The placebo-controlled Phase 1b study Cohort 2 results demonstrated that SER-155 was associated with a significant reduction in both bloodstream infections and systemic antibiotic exposure as well as a lower incidence of febrile neutropenia, as compared to placebo through day 100 post HSCT. SER-155 was generally well tolerated, with no observed treatment-related serious adverse events. In addition to allo-HSCT, the Company intends to evaluate SER-155 and other cultivated live biotherapeutic candidates in other medically vulnerable patient populations, including autologous-HSCT patients, cancer patients with neutropenia, chimeric antigen receptors therapy ("CAR-T") recipients, individuals with chronic liver disease, solid organ transplant recipients, as well as patients in the intensive care unit and long-term acute care facilities. SER-155 and the Company's other pipeline programs are designed to target multiple disease-relevant pathways and are manufactured from standard clonal cell banks via cultivation, rather than from the donor-sourced production process used for VOWST.

The Company has built and deploys a reverse translational platform and knowledge base for the discovery and development of live biotherapeutics, and maintains extensive proprietary know-how that may be used to support future research and development efforts. This platform incorporates high-resolution analysis of human clinical data to identify microbiome biomarkers associated with disease and non-disease states; preclinical screening using human cell-based assays and in vitro/ex vivo and in vivo disease models customized for live biotherapeutics; and microbiological capabilities and a strain library that spans broad biological and functional breadth to both identify specific microbes and microbial metabolites that are associated with disease and to design consortia of bacteria with specific pharmacological properties. In addition, the Company owns a valuable intellectual property estate related to the development and manufacture of live biotherapeutics.

At a special meeting of stockholders held on September 26, 2024, the Company's stockholders approved, and on September 30, 2024 (the "Closing Date"), the Company completed, the sale (the "Transaction") of its VOWST microbiome therapeutic business (the "VOWST Business"), including inventory and equipment, certain patents and patent applications, know-how, trade secrets, trademarks, domain names, marketing authorizations and related rights, documents, materials, business records and data and contracts that are used or held for use primarily in the development, commercialization and manufacturing of the microbiome product sold under the brand name VOWST as provided for in accordance with the terms of the Purchase Agreement (the "Product"), to Société des Produits Nestlé S.A. ("SPN"), a wholly-owned subsidiary of Nestlé S.A., and its designated affiliates (collectively, "Nestlé Health Science") pursuant to the Asset Purchase Agreement, dated as of August 5, 2024 (the "Purchase Agreement"), by and among the Company and SPN, and a wholly-owned subsidiary of Nestlé S.A. As consideration for the Transaction, SPN paid or agreed to pay, as applicable, the following Transaction Consideration:

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As they are earned, the Milestone Payments will be satisfied as follows: (i) first, by set-off against all accrued interest on the Prepaid Milestone until the amount of such accrued interest has been paid in full, (ii) second, by set-off against the outstanding balance of the Prepaid Milestone until the Prepaid Milestone has been repaid in full and (iii) thereafter, in cash. If any amount of the Prepaid Milestone (and any accrued interest thereon) remains outstanding as of following the last day of the Milestone Period (defined below), the balance thereof (together with any interest accrued thereon) will be forgiven and the right of set-off of SPN with respect thereto will be deemed forfeited. The Installment Payment due on July 1, 2025 will be reduced by approximately $1,500related to certain employment obligations assumed by SPN with respect to the period ended as of the Closing Date.

The Company and SPN will share 50/50 in the net profit or net loss (the "Profit Sharing Payments") achieved during the period from the date of Closing until December 31, 2025 (the "Profit Sharing Period"), with the net profit or net loss calculated as (i) the net sales of VOWST in the United States and Canada, plus (ii) other income received in connection with the grant of a license or sublicense with respect to VOWST in the United States and Canada as described in the Purchase Agreement, minus (iii) allowable expenses directly attributable or reasonably allocable to certain development activities, commercialization activities, medical affairs activities, manufacturing activities or other relevant activities, as described in the Purchase Agreement. During the Profit Sharing Period, the Company will reimburse SPN for (i) certain payments under the exclusive license agreement between the Company and Memorial Sloan Kettering Cancer Center, (ii) certain costs incurred in connection with an ongoing post-marketing safety study of VOWST and (iii) 80.1% of all rent and other costs due to the landlord under the lease for the Company's Waltham facility.

At Closing, in exchange for a payment to be made by SPN to Bacthera AG, the Long Term Manufacturing Agreement, dated November 8, 2021 between the Company and Bacthera AG (the "Bacthera Manufacturing Agreement") was terminated and each of Bacthera and Seres released one another from any and all losses, liabilities or other obligations arising thereunder with respect to the period ending at the Closing Date, including without limitation any milestone payments required to be paid to Bacthera thereunder.

On the Closing Date, the Company and SPN entered into a securities purchase agreement (the "Securities Purchase Agreement") pursuant to which SPN purchased 14,285,715shares (the "Shares") of common stock at Closing, at a purchase price per share of $1.05, for an aggregate purchase price of $15,000. Under the terms of the Securities Purchase Agreement, SPN agreed not to sell or transfer the Shares for a period of six months after Closing, subject to certain customary exceptions. The Company agreed to register the resale of the Shares by SPN within 90 days of Closing. On October 1, 2024, the Company filed a registration statement to register the Shares, which became effective on October 11, 2024. In addition, under the terms of the Securities Purchase Agreement, for as long as SPN, together with its affiliates, beneficially owns at least 10% of the Company's outstanding shares of common stock, the Company has agreed to take such action within its control to include one individual designated by SPN in the slate of nominees recommended by the Company's board of directors (or the applicable committee of the board of directors) to the Company's stockholders for election to the board of directors at the applicable stockholder meeting. The Securities Purchase Agreement contains customary representations and warranties and closing conditions.

On the Closing Date, the Company entered into a TSA with Nestlé Enterprises S.A., an affiliate of SPN ("NESA"), which provides for services to be performed by the Company in order to facilitate a transition of the business associated with the VOWST Business to NESA and its affiliates. The scope of the transition services includes the provision of certain manufacturing services and certain administrative functions related to the VOWST Business and operations, including the maintenance of certain manufacturing services and the related facility in which such services are currently conducted. The Company will provide the manufacturing services until December 31, 2025, which period may be extended by up to six months (solely to ensure the manufacturing facility is in a state of compliance with the biologics license application for VOWST and readiness for potential regulatory inspection), and other services for the duration specified in the schedule to the TSA for each service. NESA has agreed to pay the Company for certain fixed costs, including a monthly fixed fee for preserved raw material suspension manufacturing, and will reimburse the Company for certain costs of the transition services performed by the Company under the TSA. The know-how and other intellectual property generated in connection with the performance of the TSA will be owned by NESA with the Company having a non-exclusive license to such know-how and other intellectual property under the Cross-License Agreement. During the term of the TSA, upon NESA's request, the Company will transfer the specifications for materials and documentation necessary to enable preserved raw material suspension manufacturing services to a third party service provider designated by NESA. In the event of a material failure by the Company to deliver preserved raw material suspension under the TSA, NESA will have step-in rights to negotiate to enter into a direct lease with the landlord of the manufacturing facility with respect to the portion of such facility used in connection with the VOWST Business or to cause such services to be performed, with any reasonable out-of-pocket costs and expenses incurred in connection therewith reimbursed by the Company.

At the Closing Date, the Company entered into a cross-license agreement with SPN under which the Company granted to SPN a perpetual, worldwide, non-exclusive, fully paid-up license under certain Company patents that have been issued or will issue in the

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future and current know-how controlled by the Company that is not transferred to SPN pursuant to the Purchase Agreement. In the field of the treatment of Clostridioides difficileinfections ("CDI") and recurrent CDI and associated complications (collectively, the "CDI Field") the license to SPN under such Company patents and know-how will be exclusive to SPN for five years after Closing and co-exclusive between SPN and the Company following that five year period. The license from the Company to SPN is to issued Company patents that currently or in the future cover the Product or improvements thereof, and know-how that is used or reasonably useful in connection with the exploitation of the VOWST Business. The Company also granted SPN an exclusive, perpetual, worldwide, fully paid-up license under issued Company patents that currently or in the future cover the Product and improvements thereof and know-how that is used or reasonably useful in connection with the exploitation of the Product to exploit SER-262 in the CDI Field. SPN granted to the Company a perpetual, worldwide, non-exclusive license under the patents and know-how that are transferred to SPN pursuant to the Purchase Agreement or developed under the TSA, for the Company's products for use outside of the CDI Field, and after five years from Closing for Company products containing designed, cultivated, bacterial consortia not manufactured using human stool (excluding SER-262) in the CDI Field. From and after Closing, certain license agreements between the Company, SPN, and/or their respective affiliates terminated and are of no further force or effect, except as contemplated by the Purchase Agreement. For example, on September 30, 2024, in connection with the Transaction, the 2016 License Agreement (the "2016 License Agreement") with Nestec, Ltd., as succeeded by SPN (together with NHSc Rx License GmbH, their affiliates, and their subsidiaries "Nestlé"), and the 2021 License Agreement (the "2021 License Agreement") with NHSc Pharma Partners, succeeded by NHSc Rx License GmbH (together with Société des Produits Nestlé S.A, their affiliates, and their subsidiaries "Nestlé") were terminated upon mutual agreement of the parties, with provisions related to record retention, confidentiality obligations, indemnification obligations, intellectual property ownership, and any outstanding payment obligations surviving the termination of each of the 2016 License Agreement and 2021 License Agreement, respectively.

On the Closing Date, the parties entered into assignment and assumption of lease agreements (the "Assignment and Assumption Agreements"). Under the Assignment and Assumption Agreements, the Company assigned to SPN the Company's rights in, to and under certain real property leases, and SPN assumed the liabilities related thereto.

On the Closing Date, the parties entered into an employee support agreement (the "Employee Support Agreement"). Under the Employee Support Agreement, among other things and subject to the terms and conditions therein, certain employees of the Company related to the VOWST Business who accepted employment with SPN or one of its designated affiliates provided the services they provided to the Company prior to the Transaction to SPN, as well as other services as SPN may reasonably request, from Closing until the day prior to the beginning of SPN's or its designated affiliate's next pay period following the Closing. SPN reimbursed the Company's out of pocket costs in connection with such employees' services, including certain compensation and benefits paid or provided to such employees pursuant to the terms of the Employee Support Agreement.

In connection with the Transaction, the Company fully retired its senior secured debt facility with Oaktree Capital Management. The Company intends to use the remaining proceeds to support the further advancement of SER-155 and the Company's other wholly-owned cultivated live biotherapeutic candidates for medically vulnerable patient populations with potential to address large commercial opportunities.

The Company incurred certain significant costs relating to the Transaction, such as legal, accounting, financial advisory, printing and other professional services fees, as well as other customary payments. Through September 30, 2024, these costs amounted to approximately $9,016, which is included within the net income (loss) from discontinued operations, net of tax line item on the Company's condensed consolidated statement of operations.

Going Concern

The Company is subject to risks common to companies in the biotechnology industry including, but not limited to, new technological innovations, protection of proprietary technology, dependence on key personnel, compliance with government regulations and the need to obtain additional financing. The Company operates in an environment of rapid change in technology and substantial competition from pharmaceutical and biotechnology companies. In addition, the Company is dependent upon the services of its employees and consultants.

The accompanying condensed consolidated financial statements have been prepared on a basis which assumes that the Company will continue as a going concern and which contemplates the realization of assets and satisfaction of liabilities and commitments in the normal course of business. As of September 30, 2024, the Company had an accumulated deficit of $962,462and cash and cash equivalents of $66,824.

The Company's product candidates are in development, and will require significant additional research and development efforts, including extensive preclinical and clinical testing and regulatory approval, prior to potential commercialization. There can be no assurance that the Company's research and development will be successfully completed, that adequate protection for the Company's intellectual property will be obtained, or maintained, that any product candidate developed will obtain necessary government regulatory approval, or that any approved product will be commercially viable. Even if the Company's product development efforts are successful, it is uncertain when, if ever, the Company will generate significant revenue from product sales.

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Primarily as a result of the costs associated with commercializing VOWST and continuing the research and development efforts for other product candidates and preclinical programs, the Company incurred a net loss from continuing operations of $110,134and had net operating cash outflows of $109,727for the nine months ended September 30, 2024. The Company expects that its operating losses and negative cash flows will continue for the foreseeable future. Based on the Company's currently available cash resources, current and forecasted level of operations, and forecasted cash flows for the 12-month period subsequent to the date of issuance of these condensed consolidated financial statements, the Company will require additional funding to support its ongoing operations and meet its obligations as they come due. These conditions raise substantial doubt about the Company's ability to continue as a going concern.

The Company's ability to continue as a going concern is dependent upon its ability to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due, and to generate profitable operations in the future. Management plans to provide for the Company's capital requirements through financing or other strategic transactions, including potential business development transactions, and selling shares under the Company's at the market equity offering. There can be no assurance that the Company will be able to raise additional capital to fund operations with terms acceptable to the Company, or at all. Because certain elements of management's plans to mitigate the conditions that raised substantial doubt about the Company's ability to continue as a going concern are outside of the Company's control, including the ability to raise capital through an equity or other financing, those elements cannot be considered probable according to Accounting Standards Codification ("ASC") 205-40, Going Concern("ASC 205-40"), and therefore cannot be considered in the evaluation of mitigating factors. As a result, management has concluded that substantial doubt exists about the Company's ability to continue as a going concern for 12 months from the date these condensed consolidated financial statements are issued. The accompanying condensed consolidated financial statements do not include any adjustments that may result from the outcome of this uncertainty.

Unaudited Interim Financial Information

The accompanying unaudited condensed consolidated financial statements as of September 30, 2024 and for the three and nine months ended September 30, 2024 and 2023 have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC") for interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") have been condensed or omitted pursuant to such rules and regulations. However, the Company believes that the disclosures are adequate to make the information presented not misleading. These unaudited condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and the notes thereto for the year ended December 31, 2023 included in the Company's annual report on Form 10-K for the fiscal year ended December 31, 2023, which was filed with the SEC on March 5, 2024 (the "Annual Report").

The unaudited condensed consolidated interim financial statements have been prepared on the same basis as the audited consolidated financial statements. The condensed consolidated balance sheet at December 31, 2023 was derived from audited annual financial statements, but does not contain all of the footnote disclosures from the annual financial statements. In the opinion of management, the accompanying unaudited interim condensed consolidated financial statements contain all adjustments which are necessary for a fair statement of the Company's financial position, results of operations, and cash flows for the periods presented. Such adjustments are of a normal and recurring nature. The results of operations for the three and nine months ended September 30, 2024 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2024.

In late September 2024, the Company's VOWST Business met all the conditions to be classified as held for sale and, because the Company considers the disposal of the VOWST Business to be a strategic shift that will have a major effect on its operations and financial results, represented a discontinued operation. All assets and liabilities associated with the Company's VOWST Business were therefore classified as assets and liabilities of discontinued operations in our condensed consolidated balance sheets for the periods presented. Further, all historical operating results for the Company's VOWST Business are reflected within discontinued operations in the condensed consolidated statements of operations for all periods presented. For additional information, see Note 3, Discontinued Operations.

Our condensed consolidated financial statements include our accounts and the accounts of our wholly owned subsidiaries. All intercompany transactions have been eliminated in consolidation. The condensed consolidated financial statements have been prepared in conformity with U.S. GAAP.

Reclassifications

Certain amounts in prior periods have been reclassified to reflect the impact of the discontinued operations treatment of the VOWST Business in order to conform to the current period presentation.

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2. Summary of Significant Accounting Policies

The significant accounting policies and estimates used in preparation of the unaudited condensed consolidated financial statements are described in the Company's audited financial statements as of and for the year ended December 31, 2023, and the notes thereto, which are included in the Annual Report. There have been no material changes to the Company's significant accounting policies during the nine months ended September 30, 2024, with the exception of those detailed below.

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In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses (Topic 220), which requires disclosure in the notes to financial statementsabout specific types of expenses included in the expense captions presented on the face of the statement of operations. The requirements of the ASU are effective for annual periods beginning after December 15, 2026, and for interim periods beginning after December 15, 2027, with early adoption permitted. The requirements will be applied prospectively with the option for retrospective application. The Company is currently evaluating the impact related to the adoption of ASU 2024-03 on its financial statement disclosures.

3. Discontinued Operations

On September 30, 2024, the Company completed the sale of its VOWST Business to SPN. The Company has determined the sale of the VOWST Business represents a strategic shift that will have a major effect on its business and therefore met the criteria for classification as discontinued operations on September 30, 2024. Accordingly, the VOWST Business is reported as discontinued operations in accordance with ASC 205-20, Discontinued Operations. The related assets and liabilities of the VOWST Business are classified as assets and liabilities of discontinued operations in the condensed consolidated balance sheets and the results of operations from the VOWST Business as discontinued operations in the condensed consolidated statements of operations. Applicable amounts in prior years have been recast to conform to this discontinued operations presentation. The Company recognized a gain on the sale of the VOWST Business upon closing.

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As of September 30, 2024, there were no assets or liabilities of discontinued operations.

For the three and nine months ended September 30, 2024, the gain from sale of the VOWST Business, net of tax of $146,707was included in the net income (loss) from discontinued operations, net of tax line item of the Company's condensed consolidated statements of operations and comprehensive loss. While the Company has net income from discontinued operations for the three and nine months ended September 30, 2024, the Company is projecting book and tax losses for the full year ended December 31, 2024, for

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which it is more likely than not that the Company will not realize a benefit. The Company has recorded a full valuation allowance against its net deferred tax assets as of September 30, 2024 and December 31, 2023.

In accordance with ASC 205-20, only expenses specifically identifiable and related to a business to be disposed may be presented in discontinued operations. As such, the research and development and general and administrative expenses in discontinued operations include corporate costs incurred directly to solely support the VOWST Business.

The Company has also entered into a TSA with NESA, through which the Company will provide the manufacturing services until December 31, 2025, which period may be extended by up to six months (solely to ensure the manufacturing facility is in a state of compliance with the biologics license application for VOWST and readiness for potential regulatory inspection), and other services for the duration specified in the schedule to the TSA for each service. No expenses have been incurred and no reimbursements have been received in connection with the TSA for the three and nine months ended September 30, 2024.

The Company has estimated costs associated with certain accrued liabilities due to SPN as a loss contingency in accordance with ASC 450, Contingencies.These contingent liabilities are presented as Accrued Liabilities due to SPN from continuing operations on the condensed consolidated balance sheet as of September 30, 2024 and consist of the following:

The contingent liabilities accrued on the Company's condensed consolidated balance sheet as of September 30, 2024 will be remeasured at each reporting period based on i) cash payments made by the Company to reduce the accrued liabilities due to SPN and ii) revised estimates of the total remaining liabilities due to SPN.

The Company has excluded from its condensed consolidated balance sheet the effects of i) future fixed installment payments to be received by the Company after it performs services and is determined by SPN to be in material compliance with the terms and conditions of the TSA and ii) certain milestone payments received by the Company after the Product has achieved net sales-based milestones. These contingent receivables will be recognized as a gain contingency, in accordance with ASC 450, Contingencies,in continuing operations in the period when the contingencies are resolved.

The cash flows related to discontinued operations have not been segregated and are included in the condensed consolidated statements of cash flows. For the nine months ended September 30, 2024 and 2023, capital expenditures related to the VOWST

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Business were $112and $2,219, respectively. Depreciation expense related to the VOWST Business for the same periods was $989and $1,468, respectively. Non-cash operating lease costs related to the VOWST Business for the nine months ended September 30, 2024 and 2023were $1,447and $1,451, respectively, while the share based compensation expense for the same periods were $1,884and $1,947respectively. The collaboration loss sharing (related party) related to the VOWST Business was $0and $5,158for the nine months ended September 30, 2024 and 2023, respectively. Excluding the gain of $146,707recognized on the sale of the VOWST Business presented in the condensed consolidated statements of cash flows for the nine months ended September 30, 2024 there were no other material operating or investing non-cash items related to the VOWST Business for either period presented.

4. Fair Value Measurements

Money market funds are valued by the Company based on quoted market prices, which represent a Level 1 measurement within the fair value hierarchy.

As of September 30, 2024 and December 31, 2023, the Company held a restricted investment of $0and $1,401, respectively, which represents a certificate of deposit that is classified as Level 2 in the fair value hierarchy.

Level 3 financial liabilities as of December 31, 2023consisted of the warrant liabilities for which there is no current market such that the determination of fair value requires significant judgment or estimation. Changes in fair value measurements categorized within Level 3 of the fair value hierarchy were analyzed each period based on changes in estimates or assumptions and recorded through other income (expense). The Company used a Monte-Carlo simulation model which includes the Black-Scholes option pricing model to value the Level 3 warrant liabilities at inception and on each subsequent reporting date. This model incorporates transaction details such as the Company's stock price, contractual terms of the underlying warrants, maturity, risk free rates, volatility, as well as the term to achievement of estimated sales targets. The unobservable inputs for all of the Level 3 warrant liabilities are volatility and the term to achievement of estimated sales targets. The Company utilizes its historical and implied volatility, using its closing common stock prices and market data, to reflect future volatility over the expected term of the warrants. The Company estimated the time to achievement of sales targets of VOWST using information and forecasts generated by the Company in consideration of the terms of the 2021 License Agreement. As of September 30, 2024, given the repayment of the Oaktree Term Loan, the fair value of the warrant liabilities was deemed to be $0.

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There were noassets or liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the nine months ended September 30, 2023. There were notransfers between Level 1, Level 2, or Level 3 during the three and nine months ended September 30, 2024 and 2023.

5. Investments

As of September 30, 2024 and December 31, 2023, the Company held restricted investments of $0and $1,401, respectively, the cost of which approximates current fair value. The Company did not hold any other investments as of September 30, 2024 and December 31, 2023.

6. Property and Equipment, Net

Depreciation and amortization expense was $1,404, $4,383, $1,684and $4,611for the three and nine months ended September 30, 2024 and 2023, respectively, which includes amounts related to both continuing and discontinued operations. During the nine months ended September 30, 2024 and 2023, the Company disposed of certain assets with a cost basis of $594and $9, respectively. In addition, during the nine months ended September 30, 2024, the Company recorded an impairment loss of $1,536related to leasehold improvements at one of the Company's locations for which impairment indicators were determined to exist as of September 30, 2024. See Note 8, Leases, for further details.

Included within the Facility and other caption as of September 30, 2024is $4,578of accrued transaction costs related to the sale of the VOWST Business. These amounts are expected to be paid in the normal course following the Closing of the Transaction.

8. Leases

The Company leases real estate, primarily laboratory, office and manufacturing space. The Company's leases have remaining terms ranging from approximately oneto nine years. Certain leases include one or more options to renew, exercisable at the Company's sole discretion, with renewal terms that can extendthe lease from approximately one yeartoten years.The Company evaluated the renewal options in its leases to determine if it was reasonably certain that the renewal option would be exercised, given the Company's current business structure, uncertainty of future growth, and the associated impact to real estate, the Company concluded that it is not reasonably certain that any renewal options would be exercised. Therefore, the operating lease assets and operating lease liabilities only contemplate the initial lease terms. All the Company's leases qualify as operating leases.

In January 2024, the Company entered into a sublease agreement with an unrelated third party to sublease a portion of its office and laboratory space in Cambridge, Massachusetts. The term of the sublease agreement commenced in March 2024 and ends on

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January 13, 2030. The Company will receive lease payments over the sublease term totaling $10,400. The sublessee is obligated to pay all real estate taxes and costs related to the subleased premises, including cost of operations, maintenance, repair, replacement and property management.

During the three months ended March 31, 2024, the Company identified an indicator of impairment of its donor collection facility in Cambridge, Massachusetts, as the facility is no longer being used by the Company as a result of operational efficiencies implemented related to the production process and is being marketed for sublease. The Company determined that this represents a significant adverse change in the extent in which the long-lived asset was being used. The Company determined that the location contains multiple asset groups for the purpose of the long-lived asset impairment assessment. The Company concluded that the carrying value of each asset group was not recoverable as it exceeded the future net undiscounted cash flows that are expected to be generated from the assets within the asset group. In the first quarter of 2024, the Company recognized an impairment loss of $3,267, consisting of $1,731on the operating lease right-of-use asset and $1,536on the leasehold improvements. $2,727of the total impairment loss is included in research and development expenses and the remaining $540is included in general and administrative expenses in the accompanying condensed consolidated statements of operations and comprehensive loss.

During the three and nine months ended September 30, 2024 and 2023, the Company made cash payments for operating leases of $5,364, $14,321, $4,399, and $11,687, respectively. The lease cost and lease payment amounts above include amounts related to discontinued operations.