Company: PGEN
Filing Date: 2025-03-19
Form Type: 10-K
Source: 0001356090-25-000007
Chunk: 119

Company: PRECIGEN, INC.
Filing Date: 2025-03-19
Form: 10-K
Item: Item 7
Chunk 119
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 products and services declined in the current year primarily for the same reason as the revenue declined. 

Research and development expenses

Research and development expenses increased $4.5 million, or 9.2%, compared to the year ended December 31, 2023. This increase was primarily the result of $3.1 million of increased costs associated with the initiation of the PRGN-2012 confirmatory clinical trial, increased drug manufacturing material costs related to PRGN-2012 for potential commercial use, and professional fees incurred in conjunction with the Company’s completed BLA submission and commercial readiness planning as well as the design and implementation of our manufacturing facility. Additionally, employee-related expenses rose by $3.0 million primarily due to severance charges incurred as a result of the Precigen workforce reduction in 2024 and the suspension of ActoBio's operations.These increases were partially offset by a $1.9 million reduction in depreciation and amortization expense as a result of the impairment of noncurrent assets related to the suspension of ActoBio’s operations during the second quarter of 2024, as well as a reduction in clinical study expenses associated with programs that were deprioritized during the third quarter of 2024.

Selling, general and administrative expenses

SG&A expenses increased $0.9 million, or 2.2%, compared to the year ended December 31, 2023. As a result of the Company's increased focus on PRG-2012, commercial readiness cost increased in the current quarter versus prior year period. In addition, the second and third quarters of 2024 included higher severance cost associated with the suspension of ActoBio's operations and the 2024 Precigen workforce reduction. These increases were partially offset by a decrease in stock compensation and insurance rates in 2024 compared to the same period in 2023.

Impairment of goodwill and other noncurrent assets

In connection with the suspension of ActoBio’s operations, the Company recorded $34.5 million of impairment charges related to goodwill and long-lived assets in the second quarter of 2024. Additionally, we recorded $5.8 million of impairment charges related to our Exemplar reporting segment, compared to a $10.8 million impairment loss recorded during the year ended December 31, 2023. See "Notes to the Consolidated Financial Statements - Note 9" appearing elsewhere in this Annual Report for further discussion of ActoBio long-lived assets and goodwill impairment and Exemplar goodwill impairment