Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024 or


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-36829

Rocket Pharmaceuticals, Inc.

(Exact name of registrant as specified in its charter)


Delaware		04-3475813
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

9 Cedarbrook Drive, Cranbury, NJ		08512
(Address of principal executive office)		(Zip Code)

(609) 659-8001

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value per share	RCKT	Nasdaq Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer ☒		Accelerated filer ☐
Non-accelerated filer ☐		Smaller reporting company ☐
		Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of August 2, 2024, there were 90,975,859 shares of common stock, $0.01 par value per share, outstanding.

Table of Contents


		Page
	Summary of Abbreviated Terms	3
	Cautionary Statement Regarding Forward-Looking Statements	4
	PART I - FINANCIAL INFORMATION	6
Item 1.	Financial Statements	6
	Consolidated Balance Sheets as of June 30, 2024 (unaudited) and December 31, 2023	6
	Consolidated Statements of Operations for the three and six months ended June 30, 2024 and 2023 (unaudited)	7
	Consolidated Statements of Comprehensive Loss for the three and six months ended June 30, 2024 and 2023 (unaudited)	8
	Consolidated Statements of Stockholders’ Equity for the three and six months ended June 30, 2024 and 2023 (unaudited)	9
	Consolidated Statements of Cash Flows for the six months ended June 30, 2024 and 2023 (unaudited)	10
	Notes to Consolidated Financial Statements (unaudited)	11
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	39
Item 4.	Controls and Procedures	41
	PART II - OTHER INFORMATION	42
Item 1.	Legal Proceedings	42
Item 1A.	Risk Factors	42
Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities	42
Item 3.	Defaults Upon Senior Securities	42
Item 4.	Mine Safety Disclosures	42
Item 5.	Other Information	42
Item 6.	Exhibits	43
Signatures		44

Summary of Abbreviated Terms

Rocket Pharmaceuticals, Inc. may be referred to as Rocket, the Company, we, our or us, in this Quarterly Report, unless the context otherwise indicates. Throughout this Quarterly Report, we have used terms which are defined below:


2023 Form 10-K	Annual Report on Form 10-K for the fiscal year ended December 31, 2023
AAV	Adeno-associated virus
ACM	Arrhythmogenic cardiomyopathy
ASC	Accounting Standard Codification
ASGCT	American Society of Gene & Cell Therapy
BLA	Biologics License Application
BNP	Brain natriuretic peptide
cGMP	Current Good Manufacturing Practice
CIEMAT	Centro de Investigaciones Energéticas, Medioambientales y Tecnológicas
CIRM	California Institute for Regenerative Medicine
CMC	Chemistry Manufacturing Controls
CRL	Complete Response Letter
Cowen	Cowen and Company, LLC
DCM	Dilated Cardiomyopathy
DD	Danon Disease
DNA	Deoxyrubonucleic acid
EMA	European Medicines Agency
EU	European Union
Europe	EU
ESGCT	European Society of Gene & Cell Therapy
FA	Fanconi Anemia
FASB	Financial Accounting Standards Board
FDA	U.S. Food and Drug Administration
GOSH	Great Ormond Street Hospital
HNJ	Hospital Infantil de Nino Jesus
ICD	Implantable cardiac defibrillator
IND	Investigational New Drug application
IPR&D	In process research and development
KCCQ	Kansas City Cardiovascular Questionnaire
LAD-I	Leukocyte Adhesion Deficiency-I
LV	Lentiviral vector
MAA	Marketing Authorization Application
MHRA	Medicines and Healthcare Products Regulatory Agency
NYHA	New York Heart Association
PKD	Pyruvate Kinase Deficiency
PKP2-ACM	Plakophilin-2 Arrhythmogenic Cardiomyopathy
PSU	Performance stock unit
R&D	Research and development
Renovacor	Renovacor, Inc. acquired by Rocket on December 1, 2022
RSU	Restricted stock unit
RTW	RTW Investments, L.P
SEC	Securities and Exchange Commission
Stanford	Center for Definitive and Curative Medicine at Stanford University School of Medicine
U.S.	United States
U.S. GAAP	U.S. Generally Accepted Accounting Principles
UCLA	University of California, Los Angeles

Cautionary Statement Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q for the quarter ended June 30, 2024 contains forward-looking statements that involve risks and uncertainties, as well as assumptions that, if they do not materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements. We make such forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q are forward-looking statements. In some cases, you can identify forward-looking statements by words such as “aim,” “anticipate,” “believe,” “can,” “contemplate,” “continue,” “could,” “design,” “develop,” “estimate,” “expect,” “expand,” “future,” “hope,” “intend,” “likely,” “may,” “plan,” “potential,” “predict,” “project,” “pursue,” “seek,” “should,” “strategy,” “target,” “will,” “would,” or the negative of these words or other comparable terminology. These forward-looking statements include, but are not limited to, statements about:

•

our ability to meet our anticipated milestones for our various drug candidates with respect to the initiation and timing of clinical studies;

•

federal, state, and non-U.S. regulatory requirements, including regulation of our current or any other future product candidates by the FDA;

•

the timing of and our ability to submit regulatory filings with the FDA and to obtain and maintain FDA or other regulatory authority approval of, or other action with respect to, our product candidates;

•

our competitors’ activities, including decisions as to the timing of competing product launches, pricing, and discounting;

•

whether safety and efficacy results of our clinical trials and other required tests for approval of our product candidates provide data to warrant progression of clinical trials, potential regulatory approval, or further development of any of our product candidates;

•

our ability to develop, acquire and advance product candidates into, enroll a sufficient number of patients into, and successfully complete, clinical studies, and our ability to apply for and obtain regulatory approval for such product candidates, within currently anticipated timeframes, or at all;

•

our ability to establish key collaborations and vendor relationships for our product candidates and any other future product candidates;

•

our ability to develop our sales and marketing capabilities or enter into agreements with third parties to sell and market any of our product candidates;

•

our ability to acquire additional businesses, form strategic alliances or create joint ventures and our ability to realize the benefit of such acquisitions, alliances, or joint ventures;

•

our ability to successfully develop and commercialize any technology that we may in-license or products we may acquire;

•

the development of our direct manufacturing capabilities for our AAV programs;

•

our ability to expand our pipeline to target additional indications that are compatible with our gene therapy technologies;

•

our ability to successfully operate in non-U.S. jurisdictions in which we currently or in the future do business, including compliance with applicable regulatory requirements and laws;

•

our ability to obtain and enforce patents to protect our product candidates, and our ability to successfully defend ourselves against unforeseen third-party infringement claims;

•

anticipated trends and challenges in our business and the markets in which we operate;

•

our estimates regarding our capital requirements; and

•

our ability to obtain additional financing and raise capital as necessary to fund operations or pursue business opportunities.

We caution you that the foregoing list may not contain all of the forward-looking statements made in this Quarterly Report on Form 10-Q.

Any forward-looking statements in this Quarterly Report on Form 10-Q reflect our current views with respect to future events or to our future financial performance and involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. We have included important factors in the cautionary statements included in this Quarterly Report on Form 10-Q, particularly in the “Risk Factors” section incorporated by reference from our Annual Report for the year ended December 31, 2023, on Form 10-K, that could cause actual results or events to differ materially from the forward-looking statements that we make. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures, or investments we may make or enter into.

You should read this Quarterly Report on Form 10-Q and the documents that we have filed as exhibits to this Quarterly Report on Form 10-Q completely and with the understanding that our actual future results, performance, or achievements may be materially different from what we expect. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future.

This Quarterly Report on Form 10-Q also contains estimates, projections and other information concerning our industry, our business, and the markets for certain diseases, including data regarding the estimated size of those markets, and the incidence and prevalence of certain medical conditions. Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties and actual events, or circumstances may differ materially from events and circumstances reflected in this information. Unless otherwise expressly stated, we obtained this industry, business, market and other data from reports, research surveys, studies and similar data prepared by market research firms and other third parties, industry, medical and general publications, government data and similar sources. This Quarterly Report contains summaries of certain provisions contained in some of the documents described herein, but reference is made to the actual documents for complete information. All of the summaries are qualified in their entirety by the actual documents.

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements

Rocket Pharmaceuticals, Inc.

Consolidated Balance Sheets

($ in thousands, except shares and per share amounts)


	June 30, 2024			December 31, 2023
	(unaudited)
Assets
Current assets:
Cash and cash equivalents	$	38,607		$	55,904
Investments		240,218			317,271
Prepaid expenses and other current assets		13,900			5,047
Total current assets		292,725			378,222
Property and equipment, net		39,548			39,172
Goodwill		39,154			39,154
Intangible assets		25,150			25,150
Restricted cash		1,362			1,372
Deposits		481			533
Investments		-			34,320
Operating lease right-of-use assets, net		4,551			3,901
Finance lease right-of-use asset, net		43,440			44,517
Total assets	$	446,411		$	566,341
Liabilities and stockholders' equity
Current liabilities:
Accounts payable and accrued expenses	$	34,733		$	45,789
Operating lease liabilities, current		1,033			925
Finance lease liability, current		1,826			1,791
Total current liabilities		37,592			48,505
Operating lease liabilities, non-current		3,565			2,973
Finance lease liability, non-current		19,374			19,353
Other liabilities		1,245			2,936
Total liabilities		61,776			73,767
Commitments and contingencies (Note 13)

Stockholders' equity:
Preferred stock, $0.01 par value, authorized 5,000,000 shares:		-			-
Series A convertible preferred stock; 300,000 shares designated; 0 shares issued and outstanding		-			-
Series B convertible preferred stock; 300,000 shares designated; 0 shares issued and outstanding		-			-
Common stock, $0.01 par value, 180,000,000 shares authorized; 90,956,613 and 90,282,267 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively		910			903
Additional paid-in capital		1,475,013			1,450,722
Accumulated other comprehensive income (loss)		(218	)		319
Accumulated deficit		(1,091,070	)		(959,370	)
Total stockholders' equity		384,635			492,574
Total liabilities and stockholders' equity	$	446,411		$	566,341

The accompanying notes are an integral part of these consolidated financial statements.

Rocket Pharmaceuticals, Inc.

Consolidated Statements of Operations

($ in thousands, except shares and per share amounts)

(unaudited)


	Three Months Ended June 30,						Six Months Ended June 30,
	2024			2023			2024			2023
Revenue	$	-		$	-		$	-		$	-

Operating expenses:
Research and development		46,345			51,383			91,572			97,754
General and administrative		27,367			17,374			49,515			33,197
Total operating expenses		73,712			68,757			141,087			130,951
Loss from operations		(73,712	)		(68,757	)		(141,087	)		(130,951	)
Interest expense		(471	)		(468	)		(942	)		(936	)
Interest and other income, net		2,294			846			5,323			2,754
Accretion of discount on investments, net		2,243			2,678			5,006			5,097
Net loss	$	(69,646	)	$	(65,701	)	$	(131,700	)	$	(124,036	)
Net loss per share - basic and diluted	$	(0.74	)	$	(0.82	)	$	(1.40	)	$	(1.55	)
Weighted-average common shares outstanding - basic and diluted		93,746,243			80,472,362			93,759,894			79,965,755

The accompanying notes are an integral part of these consolidated financial statements.

Rocket Pharmaceuticals, Inc.

Consolidated Statements of Comprehensive Loss

($ in thousands)

(unaudited)


	Three Months Ended June 30,						Six Months Ended June 30,
	2024			2023			2024			2023
Net loss	$	(69,646	)	$	(65,701	)	$	(131,700	)	$	(124,036	)
Other comprehensive loss:
Net unrealized loss on investments		(83	)		(639	)		(537	)		(367	)
Total comprehensive loss	$	(69,729	)	$	(66,340	)	$	(132,237	)	$	(124,403	)

The accompanying notes are an integral part of these consolidated financial statements.

Rocket Pharmaceuticals, Inc.

Consolidated Statements of Stockholders’ Equity

For the Three and Six Months Ended June 30, 2024 and 2023

($ in thousands except share amounts)

(unaudited)


										Accumulated
							Additional			Other						Total
	Common Stock				Treasury		Paid-In			Comprehensive			Accumulated			Stockholders'
	Shares		Amount		Stock		Capital			Income/(Loss)			Deficit			Equity
Balance at December 31, 2023		90,282,267	$	903	$	-	$	1,450,722		$	319		$	(959,370	)	$	492,574
Issuance of common stock pursuant to exercise of stock options		73,745		-		-		1,184			-			-			1,184
Issuance of common stock pursuant to vesting of restricted stock units		290,578		3		-		(3	)		-			-			-
Unrealized comprehensive loss on investments		-		-		-		-			(454	)		-			(454	)
Stock-based compensation		-		-		-		10,252			-			-			10,252
Net loss		-		-		-		-			-			(62,054	)		(62,054	)
Balance at March 31, 2024		90,646,590	$	906	$	-	$	1,462,155		$	(135	)	$	(1,021,424	)	$	441,502
Issuance of common stock pursuant to exercise of stock options		159,355		2		-		1,528			-			-			1,530
Issuance of common stock pursuant to vesting of restricted stock units		150,668		2		-		(2	)		-			-			-
Unrealized comprehensive loss on investments		-		-		-		-			(83	)		-			(83	)
Stock-based compensation		-		-		-		11,332			-			-			11,332
Net loss		-		-		-		-			-			(69,646	)		(69,646	)
Balance at June 30, 2024		90,956,613	$	910	$	-	$	1,475,013		$	(218	)	$	(1,091,070	)	$	384,635


											Accumulated
								Additional			Other						Total
	Common Stock				Treasury			Paid-In			Comprehensive			Accumulated			Stockholders'
	Shares		Amount		Stock			Capital			Income/(Loss)			Deficit			Equity
Balance at December 31, 2022		79,123,312	$	791	$	(47	)	$	1,203,074		$	(357	)	$	(713,775	)	$	489,686
Issuance of common stock pursuant to exercise of stock options		88,429		1		-			1,113			-			-			1,114
Issuance of common stock pursuant to vesting of restricted stock units		126,060		1		-			(1	)		-			-			-
Issuance of common stock pursuant to exercise of warrants		126,093		1		-			6			-			-			7
Issuance of common stock pursuant to the at-the-market offering program, net of issuance costs		948,300		10		-			17,212			-			-			17,222
Unrealized comprehensive gain on investments		-		-		-			-			267			-			267
Stock-based compensation		-		-		-			8,915			-			-			8,915
Net loss		-		-		-			-			-			(58,335	)		(58,335	)
Balance at March 31, 2023		80,412,194	$	804	$	(47	)	$	1,230,319		$	(90	)	$	(772,110	)	$	458,876
Issuance of common stock pursuant to exercise of stock options		48,088		-		-			182			-			-			182
Issuance of common stock pursuant to vesting of restricted stock units		61,133		1		-			(1	)		-			-			-
Unrealized comprehensive loss on investments		-		-		-						(632	)					(632	)
Stock-based compensation		-		-		-			10,245			-			-			10,245
Net loss		-		-		-			-			-			(65,701	)		(65,701	)
Balance at June 30, 2023		80,521,415	$	805	$	(47	)	$	1,240,745		$	(722	)	$	(837,811	)	$	402,970

The accompanying notes are an integral part of these consolidated financial statements.

Rocket Pharmaceuticals, Inc.

Consolidated Statements of Cash Flows

($ in thousands)

(unaudited)


	Six Months Ended June 30,
	2024			2023
Operating activities:
Net loss	$	(131,700	)	$	(124,036	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization of property and equipment		3,548			2,327
Amortization of finance lease right of use asset		1,077			1,077
Stock-based compensation		21,584			19,160
Accretion of discount on investments, net		(4,996	)		(4,831	)
Changes in operating assets and liabilities:
Prepaid expenses and other assets		(729	)		2,698
Accounts payable and accrued expenses		2,122			(4,477	)
Operating lease liabilities and right of use assets, net		50			102
Finance lease liability		56			74
Other liabilities		(1,691	)		(523	)
Net cash used in operating activities		(110,679	)		(108,429	)
Investing activities:
Purchases of investments		(102,521	)		(168,930	)
Proceeds from maturities of investments		197,144			170,585
Payments made to acquire right of use asset		-			(36	)
Purchases of property and equipment		(3,965	)		(7,134	)
Net cash provided by (used in) investing activities		90,658			(5,515	)
Financing activities:
Issuance of common stock, pursuant to exercise of stock options		2,714			1,296
Issuance of common stock, pursuant to the at-the-market offering program, net of issuance costs		-			17,222
Issuance of common stock, pursuant to exercise of warrants		-			7
Net cash provided by financing activities		2,714			18,525
Net change in cash, cash equivalents and restricted cash		(17,307	)		(95,419	)
Cash, cash equivalents and restricted cash at beginning of period		57,276			141,857
Cash, cash equivalents and restricted cash at end of period	$	39,969		$	46,438

Supplemental disclosure of non-cash financing and investing activities:
Accrued purchases of property and equipment, ending balance	$	1,036		$	1,265
Investment maturity receivables and purchase payables, ending balance		8,072			-
Operating lease liabilities		1,134			-
Unrealized loss on investments	$	(537	)	$	(365	)

The accompanying notes are an integral part of these consolidated financial statements.

Rocket Pharmaceuticals, Inc.

Notes to Consolidated Financial Statements

($ in thousands, except share and per share data) (Unaudited)

Nature of Business

Rocket Pharmaceuticals, Inc. is a fully integrated, late-stage biotechnology company focused on the development of first, only and best in class gene therapies, with direct on-target mechanism of action and clear clinical endpoints, for rare and devastating diseases. The Company has three clinical-stage ex vivo lentiviral vector programs, which include programs for:

•

Fanconi Anemia, a genetic defect in the bone marrow that reduces production of blood cells or promotes the production of faulty blood cells (RP-L102);

•

Leukocyte Adhesion Deficiency-I, a genetic disorder that causes the immune system to malfunction (RP-L201); and

•

Pyruvate Kinase Deficiency, a red blood cell autosomal recessive disorder that results in chronic non-spherocytic hemolytic anemia (RP-L301).

In September 2023, the FDA accepted the BLA and granted priority review for RP-L201 for the treatment of severe LAD-I. On June 28, 2024 we announced that the FDA had issued a CRL in response to the BLA wherein the FDA requested limited additional CMC information to complete its review. We are in the process of submitting the additional requested information. Treatments in the FA Phase 2 studies were completed in 2023 with regulatory filing in the U.S. anticipated in 2024. In April 2024, the EMA accepted our MAA for RP-L102. Additional work on a gene therapy program for the less common FA subtypes C and G is ongoing.

The Company also has two clinical stage and one pre-clinical stage in vivo adeno-associated virus programs, which include programs for:

•

Danon Disease, a multi-organ lysosomal-associated disorder leading to early death due to heart failure. The DD program is currently in an ongoing Phase 2 pivotal study.

•

Plakophilin-2 Arrhythmogenic Cardiomyopathy, an inheritable cardiac disorder that is characterized by a progressive loss of cardiac muscle mass, severe right ventricular dilation, dysplasia, fibrofatty replacement of the myocardium and a high propensity to arrhythmias and sudden death. This program received FDA clearance of an Investigational New Drug application and the Company has initiated a Phase 1 study.

•

BAG3 Dilated Cardiomyopathy, which is the most common form of cardiomyopathy and is characterized by progressive thinning of the walls of the heart resulting in enlarged heart chambers that are unable to pump blood. The Company utilizes recombinant AAV9-based gene therapy designed to slow or halt progression of BAG3-DCM.

The Company has global commercialization and development rights to all of these product candidates under royalty-bearing license agreements.

Risks and Liquidity

The Company has not generated any revenue and has incurred losses since inception. Operations of the Company are subject to certain risks and uncertainties, including, among others, uncertainty of drug candidate development, technological uncertainty, uncertainty regarding patents and proprietary rights, having no commercial manufacturing experience, marketing or sales capability or experience, dependency on key personnel, compliance with government regulations and the need to obtain additional financing. Drug candidates currently under development will require significant additional research and development efforts, including extensive preclinical and clinical testing and regulatory approval, prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel infrastructure, and extensive compliance-reporting capabilities.

The Company’s product candidates are in the development and clinical stage. 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, that any products developed will obtain necessary government approval or that any approved products 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. The Company operates in an environment of rapid change in technology and substantial competition from pharmaceutical and biotechnology companies.

The Company’s consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets and the satisfaction of liabilities in the ordinary course of business. The Company has experienced negative cash flows from operations and had an accumulated deficit of $1.09 billion as of June 30, 2024. As of June 30, 2024, the Company had $278.8 million of cash, cash equivalents and investments. Excluded from the $278.8 million of cash, cash equivalent and investments are receivables from maturity of securities that have yet to be received of $8.1 million that were recorded as part of prepaid expenses and other current assets. The net balance of cash, cash equivalents and investments when adjusting for this receivable would have been $286.9 million. The Company expects such resources will be sufficient to fund the Company’s operating expenses and capital expenditure requirements into 2026.

On February 28, 2022, the Company entered into a sales agreement (the “Sales Agreement”), with Cowen, with respect to an at-the-market offering program pursuant to which the Company may offer and sell, from time to time at its sole discretion, shares of its common stock, par value $0.01 per share, having an aggregate offering price of up to $200 million (the “Shares”) through Cowen as its sales agent. On September 12, 2023, the Company and Cowen entered into an amendment (the “Amended Sales Agreement”) pursuant to which the aggregate offering amount available under the at-the-market offering program was reduced to $180.0 million. Through June 30, 2024, the Company has sold 4.2 million shares of common stock for net proceeds of $63.8 million pursuant to the at-the-market offering program (see Note 8 “Stockholders’ Equity”). The Company did not sell any shares under the at-the-market offering program during the six months ended June 30, 2024.

In the longer term, the future viability of the Company is dependent on its ability to generate cash from operating activities or to raise additional capital to finance its operations. The Company’s failure to raise capital as and when needed could have a negative impact on its financial condition and ability to pursue its business strategies.

Basis of Presentation, Principles of Consolidation and Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited interim consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements for the year ended December 31, 2023 included in the Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 27, 2024. The unaudited interim consolidated financial statements have been prepared on the same basis as the audited annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s consolidated financial position as of June 30, 2024 and the results of its operations and its cash flows for the six months ended June 30, 2024. The financial data and other information disclosed in these consolidated notes related to the three and six months ended June 30, 2024 and 2023 are unaudited. The results for the three and six months ended June 30, 2024 are not necessarily indicative of results to be expected for the year ending December 31, 2024 and any other interim periods or any future year or period.

Significant Accounting Policies

The significant accounting policies used in the preparation of these consolidated financial statements for the three and six months ended are consistent with those disclosed in Note 3 to the consolidated financial statements in the 2023 Form 10-K with the most significant policies also being listed here.

Principles of Consolidation

The consolidated financial statements represent the consolidation of the accounts of the Company and its subsidiaries in conformity with U.S. GAAP. All intercompany accounts have been eliminated in consolidation.

Use of Estimates

The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Significant estimates and assumptions reflected in these consolidated financial statements include but are not limited to goodwill and intangible asset impairments, the accrual of R&D expenses, and the valuation of equity transactions and stock-based awards. Changes in estimates and assumptions are reflected in reported results in the period in which they become known. Actual results could differ from those estimates.

Cash, Cash Equivalents and Restricted Cash

Cash, cash equivalents and restricted cash consists of bank deposits, certificates of deposit and money market accounts with financial institutions. Cash equivalents are carried at cost which approximates fair value due to their short-term nature and which the Company believes do not have a material exposure to credit risk. The Company considers all highly liquid investments with maturities of three months or less from the date of purchase to be cash equivalents. The Company’s cash and cash equivalent accounts, at times, exceed federally insured limits. The Company has not experienced any losses in such accounts.

Restricted cash consists of deposits collateralizing letters of credit issued by a bank in connection with the Company’s operating leases (see Note 12 “Leases” for additional disclosures) and a deposit collateralizing a letter of credit issued by a bank supporting the Company’s corporate credit cards. Cash, cash equivalents and restricted cash consist of the following:


	June 30, 2024		December 31, 2023
Cash and cash equivalents	$	38,607	$	55,904
Restricted cash		1,362		1,372
Total cash, cash equivalents and restricted cash	$	39,969	$	57,276

Concentrations of credit risk and off-balance sheet risk

Financial instruments that subject the Company to credit risk primarily consist of cash and cash equivalents and available-for-sale securities. The Company maintains its cash and cash equivalent balances with high quality financial institutions and, consequently, the Company believes that such funds are subject to minimal credit risk. The Company’s marketable securities consist of U.S. Treasury Securities and Corporate Bonds. The Company’s investment policy limits the amounts the Company may invest in any one type of investment and requires all investments held by the Company to be at least AA-/Aa3 rated, thereby reducing credit risk exposure.

Investments

Investments consist of U.S. Treasury Securities and Corporate Bonds. Management determines the appropriate classification of these securities at the time they are acquired and evaluates the appropriateness of such classifications at each balance sheet date. The Company classifies its investments as available-for-sale pursuant to FASB ASC 320, Investments-Debt and Equity Securities. Investments are recorded at fair value, with unrealized gains and losses included as a component of accumulated other comprehensive income (loss) in stockholders’ equity and a component of total comprehensive loss in the consolidated statements of comprehensive loss, until realized. Realized gains and losses are included in investment income on a specific-identification basis. The Company estimates expected credit losses for investments when unrealized losses exist. Unrealized losses that are credit related are recognized in the Company’s Consolidated Statements of Operations and unrealized losses that are not credit related are recognized in accumulated other comprehensive income (loss). For the three and six months ended June 30, 2024 and 2023, there were no unrealized losses that were credit related. For the three and six months ended June 30, 2024, there were net unrealized losses on investments of $0.1 and $0.5 million, respectively. For the three and six months ended June 30, 2023 there were $0.6 and $0.4 million of net unrealized losses on investments, respectively.

Intangible Assets

Intangible assets related to in process research and development projects are considered to be indefinite-lived until the completion or abandonment of the associated R&D efforts. If and when development is complete, which generally occurs if and when regulatory approval to market a product is obtained, the associated assets would be deemed finite-lived and would then be amortized based on their respective estimated useful lives at that point in time. IPR&D intangible assets which are determined to have had a decrease in their fair value are adjusted downward and an expense is recognized in R&D expenses in the Consolidated Statements of Operations. These IPR&D intangible assets are tested at least annually or when a triggering event occurs that could indicate a potential impairment based on indicators including progress of R&D activities, changes in projected development of assets, and changes in regulatory environment and future commercial markets. If a triggering event occurs that would indicate a potential impairment, the Company will perform a quantitative analysis to determine whether it is more likely than not that the fair value is below carrying amount.

Fair Value Measurements

The Company is required to disclose information on all assets and liabilities reported at fair value that enables an assessment of the inputs used in determining the reported fair values. FASB ASC 820, Fair Value Measurements and Disclosures, establishes a hierarchy of inputs used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances. The fair value hierarchy applies only to the valuation inputs used in determining the reported fair value of the investments and is not a measure of the investment credit quality. The three levels of the fair value hierarchy are described below:

•

Level 1 - Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.

•

Level 2 - Valuations based on quoted prices for similar assets or liabilities in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

•

Level 3 - Valuations that require inputs that reflect the Company’s own assumptions that are both significant to the fair value measurement and unobservable.

To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The fair value of the Company’s financial instruments, including cash and cash equivalents, restricted cash, deposits, accounts payable and accrued expenses approximate their respective carrying values due to the short-term nature of most of these instruments.

Warrants

The Company accounts for stock warrants as either equity instruments, liabilities or derivative liabilities in accordance with FASB ASC 480, Distinguishing Liabilities from Equity and/or FASB ASC 815, Derivatives and Hedging, depending on the specific terms of the warrant agreement. Liability-classified warrants are recorded at their estimated fair values at each reporting period until they are exercised, terminated, reclassified or otherwise settled. Changes in the estimated fair value of liability-classified warrants are included in interest and other income in the Company’s Consolidated Statements of Operations.

Stock-Based Compensation

The Company issues stock-based awards to employees and non-employees, generally in the form of stock options, RSUs and PSUs.

The Company measures the compensation expense of employee and non-employee services received in exchange for an award of equity instruments based on the fair value of the award on the grant date. That cost of stock options and RSUs is recognized over the requisite service period of the awards on a straight-line basis with forfeitures recognized as they occur. The vesting condition for PSUs is performance based and the cost of PSUs is recognized when it is likely that the performance goals associated with the PSUs will be achieved and the awards will vest.

The Company classifies stock-based compensation expense in its Consolidated Statements of Operations in the same manner in which the award recipient’s payroll costs and services are classified or in which the award recipient’s service payments are classified.

Recent Accounting Pronouncements

Accounting Pronouncements Not Adopted as of June 30, 2024

ASU 2023-09: Income Taxes Topic 740 - Improvements to Income Tax Disclosures. This update standardizes categories for the effective tax rate reconciliation, requires disaggregation of income taxes and additional income tax-related disclosures. This update is required to be effective for the Company for fiscal periods beginning after December 15, 2024. As this accounting standard is not expected to change the Company’s accounting, it is not expected to have a material impact on the Company's consolidated financial statements.

ASU 2023-07: Segment Reporting Topic 280 - Improvements to Reportable Segment Disclosures. This update requires expanded annual and interim disclosures for significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss. This update will be effective for fiscal years beginning after December 15, 2023, and is to be applied retrospectively to all periods presented in the financial statements. Early adoption is permitted. As this accounting standard is not expected to change the Company’s accounting, it is not expected to have a material impact on the Company’s consolidated financial statements.

Fair Value of Financial Instruments

Items measured at fair value on a recurring basis are the Company’s investments and warrant liability. The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis by level within the fair value hierarchy:


	Fair Value Measurements as of June 30, 2024 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market mutual funds	$	21,569	$	-	$	-	$	21,569
		21,569		-		-		21,569

Investments:
U.S. Treasury securities		-		227,801		-		227,801
Corporate bonds		-		12,417		-		12,417
		-		240,218		-		240,218

Total assets	$	21,569	$	240,218	$	-	$	261,787

Liabilities:
Warrant liability	$	-	$	-	$	105	$	105
Total liabilities	$	-	$	-	$	105	$	105

	Fair Value Measurements as of December 31, 2023 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market mutual funds	$	50,737	$	-	$	-	$	50,737
U.S. Treasury securities		-		2,487		-		2,487
		50,737		2,487		-		53,224

Investments:
U.S. Treasury securities		-		312,696		-		312,696
Corporate bonds		-		38,895		-		38,895
		-		351,591		-		351,591

Total assets	$	50,737	$	354,078	$	-	$	404,815

Liabilities:
Warrant liability	$	-	$	-	$	1,876	$	1,876
Total liabilities	$	-	$	-	$	1,876	$	1,876

The Company classifies its money market mutual funds as Level 1 assets under the fair value hierarchy, as these assets have been valued using quoted market prices in active markets without any valuation adjustment. The Company classifies its U.S. Treasury Securities and Corporate Bonds as Level 2 assets as these assets are not traded in an active market and have been valued through a third-party pricing service based on quoted prices for similar assets.

The reconciliation of the Company’s warrant liability, which is recorded as part of other liabilities in the Consolidated Balance Sheets, measured at fair value on a recurring basis using unobservable inputs (Level 3) is as follows:


	Warrant Liability
Balance, December 31, 2023	$	1,876
Fair value adjustments		(1,771	)
Balance, June 30, 2024	$	105

The Company utilizes a Black-Scholes model to value the warrant liability (see Note 10 “Warrants”) at each reporting period, with changes in fair value recognized in the Consolidated Statements of Operations. The estimated fair value of the warrant liability is determined using Level 3 inputs. Inherent in an options pricing model are assumptions related to expected share-price volatility, expected life, risk-free interest rate and dividend yield. The Company estimates the expected volatility of its common stock based on historical volatility of the Company and of a peer group, considering the expected remaining life of the warrants. The risk-free interest rate is based on the U.S. Treasury zero-coupon yield curve on the valuation date for a maturity similar to the expected remaining life of the warrants. The expected life of the warrants is assumed to be equivalent to their remaining contractual term. The dividend rate is based on the historical rate, which the Company anticipates will remain at zero.

The fair value of the warrant liability has been estimated with the following assumptions:


	June 30, 2024			December 31, 2023
Stock price	$	21.53		$	29.50
Exercise price	$	65.23		$	65.23
Expected volatility		59.62	%		68.83	%
Risk-free interest rate		4.85	%		4.70	%
Expected dividend yield		-			-
Expected life (years)		0.81			1.31
Fair value per warrant	$	0.17		$	3.04

Property and Equipment, Net

The Company’s property and equipment consisted of the following:


	June 30, 2024			December 31, 2023
Laboratory equipment	$	32,352		$	29,232
Machinery and equipment		12,572			12,325
Computer equipment		417			244
Furniture and fixtures		2,777			2,777
Leasehold improvements		7,107			6,723
Internal use software		1,903			1,903
		57,128			53,204
Less: accumulated depreciation and amortization		(17,580	)		(14,032	)
Total property and equipment, net	$	39,548		$	39,172

During the three and six months ended June 30, 2024, the Company recognized $1.8 million and $3.5 million of depreciation and amortization expense, respectively. During the three and six months ended June 30, 2023, the Company recognized $1.2 million and $2.3 million of depreciation and amortization expense, respectively.

Intangible Assets and Goodwill

The Company’s indefinite lived intangible assets consist of an acquired IPR&D asset received in the acquisition of Renovacor on December 1, 2022. Intangible assets as of June 30, 2024 and December 31, 2023 are summarized as follows:


	June 30, 2024		December 31, 2023
Gross carrying value	$	25,150	$	25,150
Accumulated amortization		-		-
Total intangible assets	$	25,150	$	25,150

The carrying value of Goodwill as of June 30, 2024 and December 31, 2023 was $39.2 million.

Accounts Payable and Accrued Expenses

The Company’s accounts payable and accrued expenses consisted of the following:


	June 30, 2024		December 31, 2023
Research and development	$	17,356	$	13,867
Investment payable		-		13,137
Employee compensation		7,291		9,930
Property and equipment		1,036		1,077
Professional fees		5,989		6,006
Other		3,061		1,772
Total accounts payable and accrued expenses	$	34,733	$	45,789

The $13.1 million investment payable at December 31, 2023 was related to investment purchases of available-for-sale securities in 2023 that settled in 2024.

Stockholders’ Equity

At-the-Market Offering Program

On February 28, 2022, the Company entered into the Sales Agreement with Cowen with respect to an at-the-market offering program pursuant to which the Company may offer and sell, from time to time at its sole discretion, shares through Cowen as its sales agent. The shares to be offered and sold under the Sales Agreement, if any, will be offered and sold pursuant to the Company’s shelf registration statement on Form S-3. The Company filed a prospectus supplement with the SEC on February 28, 2022 in connection with the offer and sale of the shares pursuant to the Sales Agreement. The Company will pay Cowen a cash commission of 3.0% of gross proceeds from the sale of the shares pursuant to the Sales Agreement. The Company has provided Cowen with customary indemnification and contribution rights. The Company has reimbursed Cowen for certain expenses incurred in connection with the Sales Agreement. On September 12, 2023, the Company and Cowen entered into the Amended Sales Agreement pursuant to which the aggregate offering amount available under the at-the-market offering program was reduced to $180.0 million. Through June 30, 2024, the Company sold 4.2 million shares under the at-the-market offering program for gross proceeds of $65.8 million, less commissions of $2.0 million for net proceeds of $63.8 million. The Company did not sell any shares under the at-the-market offering program during the six months ended June 30, 2024.

Stock-Based Compensation

Stock Option Valuation

The weighted average assumptions that the Company used in a Black-Scholes pricing model to determine the fair value of stock options granted to employees, non-employees and directors were as follows:


	Six Months Ended June 30,
	2024			2023
Risk-free interest rate		4.94	%		3.96	%
Expected term (in years)		5.82			5.84
Expected volatility		73.69	%		73.42	%
Expected dividend yield		0.00	%		0.00	%
Exercise price	$	27.90		$	20.20
Fair value of common stock	$	27.90		$	20.20

The following table summarizes stock option activity for the six months ended June 30, 2024:


				Weighted		Weighted
				Average		Average		Aggregate
	Number of			Exercise		Contractual		Intrinsic
	Shares			Price		Term (Years)		Value
Outstanding as of December 31, 2023		14,863,996		$	15.07		5.16	$	250,602
Granted		1,595,074			27.90		9.63
Exercised		(233,100	)		11.64				3,249
Cancelled or forfeited		(119,813	)		24.83
Outstanding as of June 30, 2024		16,106,157		$	16.31		5.15	$	136,365

Options vested and exercisable as of June 30, 2024		12,735,361		$	14.46		4.12	$	131,840
Options unvested as of June 30, 2024		3,370,796		$	23.34		9.03	$	4,525

The weighted average grant-date fair value per share of stock options granted during the six months ended June 30, 2024, and 2023 was $18.80 and $13.46, respectively.

The total fair value of options vested during six months ended June 30, 2024 and 2023 was $19.3 million and $19.9 million, respectively.

Restricted Stock Units

The following table summarizes the Company’s RSU activity for the six months ended June 30, 2024:


				Weighted Average
	Number of			Grant Date
	Shares			Fair Value
Unvested as of December 31, 2023		1,490,357		$	18.53
Granted		694,940			28.34
Vested		(441,246	)		18.99
Forfeited		(59,898	)		18.95
Unvested as of June 30, 2024		1,684,153		$	22.44

Performance Stock Units

The following table summarizes the Company’s PSU activity for six months ended June 30, 2024:


			Weighted Average
	Number of		Grant Date
	Shares		Fair Value
Unvested as of December 31, 2023		-	$	-
Granted		156,738		27.93
Vested		-		-
Forfeited		-		-
Unvested as of June 30, 2024		156,738	$	27.93

PSU vesting and expense recognition is based on achievement of specific performance goals within certain time periods. PSU awards that are not achieved within specific time periods are forfeited. No performance goals were probable of achievement and no time periods had expired as of June 30, 2024.

Stock-Based Compensation Expense

Stock-based compensation expense recognized by award type was as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Stock options	$	7,162	$	7,455	$	14,100	$	14,440
Restricted stock units		4,170		2,790		7,484		4,720
Total stock-based compensation expense	$	11,332	$	10,245	$	21,584	$	19,160

Stock-based compensation expense by classification included within the Consolidated Statements of Operations and Comprehensive Loss was as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Research and development	$	4,885	$	4,638	$	9,522	$	8,457
General and administrative		6,447		5,607		12,062		10,703
Total stock-based compensation expense	$	11,332	$	10,245	$	21,584	$	19,160

As of June 30, 2024, the Company had an aggregate of $82.6 million of unrecognized stock-based compensation expense related to stock options, RSU and PSU grants. The stock options and RSU grants had an aggregate of $78.2 million of unrecognized stock-based compensation expense, which is expected to be recognized over a weighted average period of 1.87 years.

10.

Warrants

A summary of the warrants outstanding as of June 30, 2024 is as follows:


Exercise Price	Outstanding	Grant/Assumption Date	Expiration Date
$57.11	603,386	December 21, 2020	December 21, 2030
33.63	301,291	August 9, 2021	August 9, 2031
22.51	153,155	December 17, 2021	December 17, 2031
22.51	153,155	December 17, 2021	December 17, 2031
65.23	617,050	December 1, 2022	April 23, 2025
65.23	760,086	December 1, 2022	December 1, 2026
$0.01	3,126,955	September 15, 2023	N/A
Total	5,715,078

There were no changes in warrants to purchase common stock for the six months ended June 30, 2024.

Warrants Issued in Public Offering

On September 15, 2023, the Company completed a public offering that included pre-funded warrants to purchase 3,126,955 shares of common shares at a price of $0.01 per share (see Note 17 “Related Party Transactions”).

Assumed Renovacor Public Warrants

In conjunction with the acquisition of Renovacor, Rocket assumed pre-acquisition public warrants (“Public Warrants”) that were converted into Rocket warrants with a right to purchase 760,086 of Rocket common shares at an exercise price of $65.23 per share.

The Company determined that the Public Warrants met all of the criteria for equity classification. Accordingly, upon closing of the acquisition, the Public Warrants were recorded as a component of additional paid-in capital of $3.4 million.

Assumed Renovacor Private Warrants

In conjunction with the acquisition of Renovacor, Rocket assumed pre-acquisition private warrants (“Private Warrants”) that were converted into Rocket warrants with a right to purchase 617,050 of Rocket common shares at an exercise price of $65.23 per share.

The Company determined that the Private Warrants did not meet all of the criteria for equity classification. Accordingly, the Company classifies the Private Warrants as derivative liabilities in its Consolidated Balance Sheets. The Company measures the fair value of the warrants at the end of each reporting period and recognizes changes in the fair value from the prior period in the Company’s operating results for the current period. See Note 4 “Fair Value of Financial Instruments” for discussion of fair value measurement of the warrant liability.

11.

Net Loss Per Share

Basic and diluted net loss per share attributable to common stockholders was calculated as follows:


	Three Months Ended June 30,						Six Months Ended June 30,
	2024			2023			2024			2023
Numerator:
Net loss attributable to common stockholders	$	(69,646	)	$	(65,701	)	$	(131,700	)	$	(124,036	)
Denominator:
Weighted-average common shares outstanding - basic and diluted		93,746,243			80,472,362			93,759,894			79,965,755
Net loss per share attributable to common stockholders - basic and diluted	$	(0.74	)	$	(0.82	)	$	(1.40	)	$	(1.55	)

For the six months ended June 30, 2024, the Company included the 3,126,955 shares of common stock issuable upon exercise of pre-funded warrants acquired by funds affiliated with RTW as it was determined that these met the definition for equity classification and the holder is only required to pay $0.01 per share upon exercise of the pre-funded warrants.

The Company excluded the following potential shares of common stock, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share attributable to common stockholders for the periods indicated because including them would have had an anti-dilutive effect:


	Three and Six Months Ended June 30,
	2024		2023
Warrants exercisable for common shares		2,588,123		2,588,123
Restricted stock units		1,684,153		1,654,759
Performance stock units		156,738		-
Options to purchase common shares		16,106,157		14,875,150
Total potential shares excluded from diluted net loss per share		20,535,171		19,118,032

12.

Leases

Finance Lease

The Company has a lease for a facility in Cranbury, New Jersey, consisting of 103,720 square feet of space including areas for offices, process development, research, and development laboratories and 50,000 square feet dedicated to AAV cGMP manufacturing facilities to support the Company’s pipeline (such lease, as amended, the “NJ Lease Agreement”). The NJ Lease Agreement has a 15-year term from September 1, 2019, with an option to renew for two consecutive five-year renewal terms.

Estimated rent payments for the NJ Lease Agreement are $1.2 million per annum, payable in monthly installments, depending upon the nature of the leased space, and subject to annual base rent increases of 3%. The total commitment under the lease is estimated to be approximately $29.3 million over the 15-year term of the lease. The Company paid a cash security deposit of $0.3 million to the landlord in connection with the NJ Lease Agreement which has been reflected as part of deposits in the Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023.

Operating Leases

On June 7, 2018, the Company entered into a three-year lease agreement for office space in the Empire State Building in New York, NY (the “ESB Lease Agreement”). In connection with the ESB Lease Agreement, the Company established an irrevocable standby letter of credit (the “Empire LOC”) for $0.8 million. On March 26, 2021, the Company entered into Amendment No. 1 to the ESB Lease Agreement (“ESB Lease Amendment”) that extended the term of the lease agreement to June 30, 2024, reduced the rent payments going forward, and reduced the Empire LOC to $0.8 million. On March 29, 2024, the Company entered into Amendment No. 2 to the ESB Lease Agreement that extended the term of the lease agreement to July 31, 2027. The Empire LOC serves as the Company’s security deposit on the lease in which the landlord is the beneficiary and expires September 30, 2027.

The Company has a certificate of deposit of $0.8 million with a bank as collateral for the Empire LOC which is classified as part of restricted cash in the Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023.

On November 15, 2022, the Company entered into a lease agreement with a lease term until October 31, 2024, for laboratory space in Madrid, Spain. The lease commenced on April 1, 2023 and the Company recognized a right-of-use asset and corresponding lease liability of approximately $0.2 million each.

On December 1, 2022, in connection with the acquisition of Renovacor, the Company acquired the Renovacor operating leases for space at facilities in Hopewell, New Jersey and Cambridge, Massachusetts with remaining lease terms of approximately 10.3 and 1.3 years, respectively. The Company recognized total right-of-use assets of $3.8 million with corresponding total lease liabilities of $3.6 million at lease commencement dates. The Company signed an agreement to sublease one of these facilities in January 2024 and intends to sublease the other remaining facilities. Rental income received under the sublease agreement totaled $0.1 million and $0.2 million for the three and six months ended June 30, 2024, respectively.

Rent expense under operating leases was $0.8 million and $1.4 million for the three and six months ended June 30, 2024. Rent expense under operating leases was $0.5 million and $1.0 million for the three and six months ended June 30, 2023, respectively.

The total restricted cash balance for the Company’s operating and finance leases as of June 30, 2024 and December 31, 2023 was $0.8 million.

Operating lease cost was $0.3 million and $0.7 million for the three and six months ended June 30, 2024, respectively. Operating lease cost was $0.4 million and $0.7 million for the three and six months ended June 30, 2023, respectively.

The following table summarizes lease cost for the six months ended June 30, 2024 and 2023:


	Six Months Ended June 30,
Lease cost	2024		2023
Operating lease cost	$	672	$	742
Finance lease cost:
Amortization of right of use assets		1,077		1,077
Interest on lease liabilities		942		936
Total lease cost	$	2,691	$	2,755

The following table summarizes the future lease payments of the Company’s operating lease liabilities on an undiscounted cash flow basis:


Fiscal Year Ending December 31,	June 30, 2024
2024 (six months)	$	533
2025		1,001
2026		1,005
2027		759
2028		522
Thereafter		2,420
Total lease payments	$	6,240
Less: interest		(1,642	)
Total operating lease liabilities	$	4,598

The following table summarizes the future lease payments of the Company’s finance lease liability on an undiscounted cash flow basis:


Fiscal Year Ending December 31,	June 30, 2024
2024 (six months)	$	905
2025		1,856
2026		1,911
2027		1,969
2028		2,028
Thereafter		41,003
Total lease payments	$	49,672
Less: interest		(28,472	)
Total finance lease liability	$	21,200

The following table summarizes the operating and financing lease liabilities and right-of-use assets as of June 30, 2024 and December 31, 2023:


Leases	June 30, 2024		December 31, 2023
Operating right-of-use assets	$	4,551	$	3,901

Operating current lease liabilities	$	1,033	$	925
Operating noncurrent lease liabilities		3,565		2,973
Total operating lease liabilities	$	4,598	$	3,898

Finance right-of-use assets	$	43,440	$	44,517

Finance current lease liability	$	1,826	$	1,791
Finance noncurrent lease liability		19,374		19,353
Total finance lease liability	$	21,200	$	21,144


	Six Months Ended June 30,
Other Information	2024			2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	584		$	582
Cash flows from finance lease	$	886		$	862
Weighted-average remaining lease term - operating leases		6.9 years			7.9 years
Weighted-average remaining lease term - finance lease		20.2 years			21.2 years
Weighted-average discount rate - operating leases		8.82	%		8.25	%
Weighted-average discount rate - finance lease		8.96	%		8.96	%

13.

Commitments and Contingencies

Litigation

From time to time, the Company may be subject to various legal proceedings and claims that arise in the ordinary course of its business activities. Although the results of litigation and claims cannot be predicted with certainty, the Company does not believe it is party to any other claim or litigation the outcome of which, if determined adversely to the Company, would individually or in the aggregate be reasonably expected to have a material adverse effect on its business. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources and other factors.

Indemnification Arrangements

Pursuant to its bylaws and as permitted under Delaware law, the Company has indemnification obligations to directors, officers, employees or agents of the Company or anyone serving in these capacities. The maximum potential amount of future payments the Company could be required to pay is unlimited. The Company has insurance that reduces its monetary exposure and would enable it to recover a portion of any future amounts paid. As a result, the Company believes that the estimated fair value of these indemnification commitments is minimal.

Throughout the normal course of business, the Company has agreements with vendors that provide goods and services required by the Company to run its business. In some instances, vendor agreements include language that requires the Company to indemnify the vendor from certain damages caused by the Company’s use of the vendor’s goods and/or services. The Company has insurance that would allow it to recover a portion of any future amounts that could arise from these indemnifications. As a result, the Company believes that the estimated fair value of these indemnification commitments is minimal.

14.

Agreements Related to Intellectual Property

The Company, directly and through its subsidiary Spacecraft Seven, LLC, has various license and research and collaboration arrangements. The transactions principally resulted in the acquisition of rights to intellectual property which is in the preclinical phase and has not been tested for safety or feasibility. In all cases, the Company did not acquire tangible assets, processes, protocols, or operating systems. The Company expenses the acquired intellectual property rights as of the acquisition date on the basis that the cost of intangible assets purchased from others for use in R&D activities has no alternative future uses.

15.

CIRM Grants

LAD-I CIRM Grant

On April 30, 2019, CIRM awarded the Company up to $7.5 million under a CLIN2 grant award to support the clinical development of its LV-based gene therapy for RP-L201. Proceeds from the grant would help fund clinical trial costs as well as manufactured drug product for Phase 1/2 patients enrolled at the U.S. clinical site, University of California, Los Angeles Mattel Children’s Hospital, led by principal investigator Donald Kohn, M.D., UCLA Professor of Microbiology, Immunology and Molecular Genetics, Pediatrics (Hematology/Oncology), Molecular and Medical Pharmacology and member of the Eli and Edythe Broad Center of Regenerative Medicine and Stem Cell Research at UCLA. As of June 30, 2024, the Company has received $5.9 million in total RP-L201 grants from CIRM. The Company received a final milestone grant of $0.05 million on January 2, 2024 and no additional payments are available under the grant awards program.

16.

Related Party Transactions

In June 2023, the Company entered into a consulting agreement with the spouse of one of the Company’s executive officers for information technology advisory services. The Company incurred expenses of approximately $0.002 million for the six months ended June 30, 2024, relating to services provided under this agreement.

In September 2023, in connection with a public offering, the Company sold approximately 3.1 million pre-funded warrants to purchase shares of the Company’s common stock to funds affiliated with RTW, the Company’s largest shareholder (see Note 10 “Warrants”).

17.

401(k) Savings Plan

The Company has a defined contribution savings plan (the “Plan”) under Section 401(k) of the Internal Revenue Code of 1986. This Plan covers substantially all employees who meet minimum age and service requirements and allows participants to defer a portion of their annual compensation on a pre-tax basis. Company contributions to the Plan may be made at the discretion of the Company’s Board of Directors. The Company has elected the safe harbor match of 4% of employee contributions to the Plan, subject to certain limitations. The Company’s matching contribution for the three and six months ended June 30, 2024, was $0.4 and $0.8 million, respectively. The Company’s matching contribution for the three and six months ended June 30, 2023, was $0.3 and $0.6 million, respectively.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis of our financial condition and results of operations together with the consolidated financial statements and related notes that are included elsewhere in this Quarterly Report on Form 10-Q and our 2023 Form 10-K. This discussion contains forward-looking statements based upon current plans, expectations and beliefs that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including, but not limited to, those discussed in the 2023 Form 10-K and in this Quarterly Report on Form 10-Q. In preparing this MD&A, we presume that readers have access to and have read the MD&A in our 2023 Form 10-K.

We are a fully integrated, late-stage biotechnology company focused on the development of first, only and best in class gene therapies, with direct on-target mechanism of action and clear clinical endpoints, for rare and devastating diseases. We have three clinical-stage ex vivo lentiviral vector programs, which include programs for:

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Fanconi Anemia, a genetic defect in the bone marrow that reduces production of blood cells or promotes the production of faulty blood cells (RP-L102);

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Leukocyte Adhesion Deficiency-I, a genetic disorder that causes the immune system to malfunction (RP-L201); and

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Pyruvate Kinase Deficiency, a red blood cell autosomal recessive disorder that results in chronic non-spherocytic hemolytic anemia (RP-L301).

We also have two clinical stage and one pre-clinical stage in vivo adeno-associated virus programs, which include programs for:

•

Danon Disease, a multi-organ lysosomal-associated disorder leading to early death due to heart failure. The DD program is currently in an ongoing Phase 2 trial.

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BAG3 Dilated Cardiomyopathy, which is the most common form of cardiomyopathy and is characterized by progressive thinning of the walls of the heart resulting in enlarged heart chambers that are unable to pump blood. Our program utilizes recombinant AAV9-based gene therapy designed to slow or halt progression of BAG3-DCM.

We have global commercialization and development rights to all of these product candidates under royalty-bearing license agreements.

Recent Developments

At-the-Market Offering Program

On February 28, 2022, we entered into the Sales Agreement with Cowen with respect to an at-the-market offering program pursuant to which we may offer and sell, from time to time at our sole discretion, shares through Cowen as our sales agent. The shares to be offered and sold under the Sales Agreement, if any, will be offered and sold pursuant to our shelf registration statement on Form S-3. We filed a prospectus supplement with the SEC on February 28, 2022 in connection with the offer and sale of the shares pursuant to the Sales Agreement. We will pay Cowen a cash commission of 3.0% of gross proceeds from the sale of the shares pursuant to the Sales Agreement. We also agreed to provide Cowen with customary indemnification and contribution rights. We have reimbursed Cowen for certain expenses incurred in connection with the Sales Agreement. On September 12, 2023, the Company and Cowen entered into an amendment pursuant to which the aggregate offering amount available under the at-the-market offering program was reduced to $180.0 million. Through June 30, 2024, we sold 4.2 million shares under the at-the-market offering program for gross proceeds of $65.8 million, less commissions of $2.0 million for net proceeds of $63.8 million. We did not sell any shares under the at-the-market offering program during the six months ended June 30, 2024.

Gene Therapy Overview

Genes are composed of sequences of deoxyribonucleic acid, which provide the code for proteins that perform a broad range of physiologic functions in all living organisms. Although genes are passed on from generation to generation, genetic changes, also known as mutations, can occur in this process. These changes can result in the lack of production of proteins or the production of altered proteins with reduced or abnormal function, which can in turn result in disease.

Gene therapy is a therapeutic approach in which an isolated gene sequence or segment of DNA is administered to a patient, most commonly for the purpose of treating a genetic disease that is caused by genetic mutations. Currently available therapies for many genetic diseases focus on administration of large proteins or enzymes and typically address only the symptoms of the disease. Gene therapy aims to address the disease-causing effects of absent or dysfunctional genes by delivering functional copies of the gene sequence directly into the patient’s cells, offering the potential for curing the genetic disease, rather than simply addressing symptoms.

We are using modified non-pathogenic viruses for the development of our gene therapy treatments. Viruses are particularly well suited as delivery vehicles because they are adept at penetrating cells and delivering genetic material inside a cell. In creating our viral delivery vehicles, the viral (pathogenic) genes are removed and are replaced with a functional form of the missing or mutant gene that is the cause of the patient’s genetic disease. The functional form of a missing or mutant gene is called a therapeutic gene, or the “transgene.” The process of inserting the transgene is called “transduction.” Once a virus is modified by replacement of the viral genes with a transgene, the modified virus is called a “viral vector.” The viral vector delivers the transgene into the targeted tissue or organ (such as the cells inside a patient’s bone marrow). We have two types of viral vectors in development, LV and AAV. We believe that our LV and AAV-based programs have the potential to offer a significant and long-lasting therapeutic benefit to patients.

The gene therapies can be delivered either (1) ex vivo (outside the body), in which case the patient’s cells are extracted and the vector is delivered to these cells in a controlled, safe laboratory setting, with the modified cells then being reinserted into the patient, or (2) in vivo (inside the body), in which case the vector is injected directly into the patient, either intravenously or directly into a specific tissue at a targeted site, with the aim of the vector delivering the transgene to the targeted cells.

We believe that scientific advances, clinical progress, and the greater regulatory acceptance of gene therapy hZave created a promising environment to advance gene therapy products as these products are being designed to restore cell function and improve clinical outcomes, which in many cases include prevention of death at an early age. The FDA approval of several gene therapies in recent years indicates that there is a regulatory pathway forward for gene therapy products.

Pipeline Overview

The chart below shows the current phases of development of our programs and product candidates:

Cardiovascular Programs

Danon Disease

DD is a multi-organ lysosomal-associated disorder leading to early death due to heart failure. DD is caused by mutations in the gene encoding lysosome-associated membrane protein 2, a mediator of autophagy. This mutation results in the accumulation of autophagic vacuoles, predominantly in cardiac and skeletal muscle. Male patients often require heart transplantation and typically die in their teens or twenties from progressive heart failure. Along with severe cardiomyopathy, other DD-related manifestations can include skeletal muscle weakness and intellectual impairment. There are no specific therapies available for the treatment of DD and medications typically utilized for the treatment of congestive heart failure are not believed to modify progression to end-stage congestive heart failure. Patients with end-stage congestive heart failure may undergo heart transplant, which currently is available to a minority of patients, is associated with significant short- and long-term complications and is not curative of the disorder in the long-term. RP-A501 is in clinical trials as an in vivo therapy for DD, which is estimated to have a prevalence of 15,000 to 30,000 patients in the U.S. and the EU.

DD is an X-linked dominant, monogenic rare inherited disorder characterized by progressive cardiomyopathy which is almost universally fatal in males even in settings where cardiac transplantation is available. DD predominantly affects males early in life and is characterized by absence of LAMP2B expression in the heart and other tissues. Preclinical models of DD have demonstrated that AAV-mediated transduction of the heart results in reconstitution of LAMP2B expression and improvement in cardiac function.

We currently have one AAV program targeting DD, RP-A501. We have treated seven patients in the RP-A501 Phase 1 clinical trial, which enrolled adult/older adolescent and pediatric male DD patients. This includes a first cohort evaluating a low-dose (6.7e13 genome copies (gc)/kilogram (kg)) in adult/older adolescent patients aged 15 or greater (n=3), a second cohort evaluating a higher dose (1.1e14 gc/kg) in adult/older adolescent patients aged 15 or greater (n=2), and a pediatric cohort at a low dose level (6.7e13 gc/kg; n=2).

As previously disclosed, a patient receiving therapy on the high dose cohort (1.1e14 gc/kg dose) had progressive heart failure and underwent a heart transplant at month five following therapy. This patient had more advanced disease than the four other adult/older adolescent patients who received treatment in the low and high dose cohorts, as evidenced by diminished baseline left ventricle ejection fraction (35%) on echocardiogram and markedly elevated left ventricle filling pressure prior to treatment. The patient’s clinical course was characteristic of DD progression. The patient is doing well post-transplant.

Based on the initial efficacy observed in the low dose cohort and to mitigate complement-mediated safety concerns observed in the high dose cohort (thrombotic microangiopathy) and in agreement with the FDA, we are focusing on the low dose (6.7e13 gc/kg) and we will no longer administer doses of 1.1e14 gc/kg or higher in this trial. Additional safety measures have been implemented and are reflected in the updated trial protocol. These measures include exclusion of patients with end-stage heart failure, and a refined immunomodulatory regimen involving transient B- and T-cell mediated inhibition, with emphasis on preventing complement activation, while also enabling lower steroid doses and earlier steroid taper, with all immunosuppressive therapy discontinued 2-3 months following administration of RP-A501.

We conducted a variety of efficacy assessments in the Phase I clinical study to measure the prospect of benefit for patients. These assessments included the following:

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New York Heart Association Functional Classification is the most commonly used heart failure classification system. NYHA Class II is where a patient exhibits a slight limitation of physical activity, is comfortable at rest, and ordinary physical activity results in fatigue, palpitation and/or dyspnea. Class I is where a patient exhibits no limitation of physical activity and ordinary physical activity does not cause undue fatigue, palpitation and/or dyspnea. Class III and IV are considered more severe or advanced heart failure.

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Brain natriuretic peptide is a blood-based evaluation and a key marker of heart failure with prognostic significance in congestive heart failure and cardiomyopathies. Elevations in BNP are strongly associated with worsening heart failure and poor outcomes in cardiovascular disease.

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High sensitivity troponin I is a blood-based evaluation and a key marker of cardiac injury, one that is (like BNP) frequently elevated in DD patients and has been shown to be markedly elevated in patients with advanced stage disease.

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Echocardiographic measurements of heart thickness, most notably, left ventricular mass and maximal left ventricular wall
thickness, indicate the degree of hypertrophy present in the heart.

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Kansas City Cardiovascular Questionnaire is a validated, patient-reported outcomes assessment that measures a patients perception of their heart failure symptoms, impact of disease on physical and social function, and the impact of their heart failure on overall health status and quality of life. Assessment scores range from 0 (very poor health status) to 100 (excellent health status). Changes in KCCQ score of +/- 5 points are considered meaningful and have been shown to correlate with outcomes.

•

Histologic examination of endomyocardial biopsies via hematoxylin and eosin histology and electron microscopy is used to detect evidence of DD-associated tissue derangements, including the presence of autophagic vacuoles and disruption of myofibrillar architecture, each of which are characteristic of DD-related myocardial damage.

•

LAMP2 gene expression in endomyocardial biopsy samples is measured via both immunohistochemistry and Western blot and confirms the presence of LAMP2 protein in DD cardiac tissue following RP-A501 treatment.

On January 9, 2023, we presented positive efficacy updates from our Phase I study of RP-A501 during the 41st Annual J.P. Morgan Healthcare Conference. The data presented included several additional months of follow-up, which showed further improvements in key biomarkers, echocardiographic and functional measures. A summary of these updates is provided in the table below. We also provided additional natural history comparator data, which showed the marked divergence of the course of Phase I patients from that of untreated patients in terms of key biomarkers (BNP) and functional measures (NYHA Class). Furthermore, RP-A501 continued to be well tolerated at 2-3 years post treatment in both adult/older adolescent high and low-dose cohorts and at 8 to 13 months in the pediatric cohort. In the pediatric cohort, no significant immediate or delayed toxicities, significant skeletal myopathy, or late transaminase elevation have been observed.

Improvement or Stabilization Observed Across Key Biomarker, Echo Findings and Functional Measures in Phase 1 RP-A501 study

Darker Green = improved; Lighter Green = minimal change (stabilization).

Does not include Patient 1007 in Phase 1 trial who had advanced heart failure with ejection fraction < 40% at enrollment and received heart transplantation 5 months following treatment due to pre-existing advanced heart failure. Patient is currently stable. Data cut-off September 27, 2022.

1 Patient 1008 echocardiographic parameters are M9 visit (M12 pending).

2 Patient 1002 NYHA class depicted for M30 visit (M36 pending).

3 Patient 1005 KCCQ score depicted for M24 visit (M30 pending).

In addition to these clinical updates, we also provided updates on our in-house manufacturing activities. As of January 2023, we had successfully produced 2 cGMP RP-A501 batches that have superior specifications to Phase I material in both titer and full versus empty particles. We believe the improved quality of our in-house manufactured product will allow for full dosing with lower total viral particles, potentially further optimizing the safety profile of RP-A501. Furthermore, we have agreement from the FDA on the continued utilization of HEK-293 cell-based process through commercialization as well as our comparability approach and potency assay.

In May 2023, we presented previously disclosed results from the Phase I study of RP-A501 at the ASGCT 26th Annual Meeting. As of the most recent data extraction, all six patients that remain in follow-up continued to show signs of improvement or stabilization.

Results from the ongoing Phase 1 DD trial represent one of the most comprehensive investigational gene therapy datasets for any cardiac condition. RP-A501 was generally well tolerated with evidence of durable treatment activity and improvement of DD for both pediatric patients with up to nine months of follow-up and four adult/older adolescent patients with up to 36 months of follow-up. All adult/older adolescent and pediatric patients who received a closely monitored immunomodulatory regimen showed improvements across tissue, laboratory, and imaging-based biomarkers, as well as in NYHA class (from II to I) and KCCQ scores with follow-up of six to 36 months.

On September 12, 2023, we announced that alignment was reached with the FDA on the global Phase 2 pivotal trial of RP-A501 for DD. The global, single-arm, multi-center Phase 2 pivotal trial will evaluate the efficacy and safety of RP-A501 in 12 patients with DD, including a pediatric safety run-in (n=2), with a natural history comparator and a dose level of 6.7 x 1013 GC/kg.

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To support accelerated approval, the study will assess the efficacy of RP-A501 as measured by the biomarker-based co-primary endpoint consisting of improvements in LAMP2 protein expression (≥ Grade 1, as measured by immunohistochemistry), and reductions in left ventricular mass.

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Key secondary endpoint is change in troponin. Additional secondary endpoints will include natriuretic peptide, KCCQ, NYHA class, event free survival to 24 months and treatment emergent safety events. These endpoints could support full approval with longer-term follow-up.

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A global natural history study will serve as an external comparator and run concurrently to the Phase 2 pivotal trial.

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In-house manufacturing has been completed with sufficient high-quality drug product produced to fully supply the Phase 2 pivotal study. Potency assays have been developed and qualified in accordance with FDA guidance.

Phase 2 enrollment and treatment in the U.S. is ongoing. We have filed the Clinical Trial Application and Investigational Medicinal Product Dossier for RP-A501 with the relevant Member States through the EU Clinical Trial Information System and the Medical and Healthcare Products Regulatory Agency. In January 2024, we received CTIS approval and MHRA approval for these clinical trial applications. We are initiating Phase 2 pivotal trial activities in Europe and the UK.

Recently Achieved Milestones

On February 7, 2023, we announced that RP-A501 received regenerative medicine advanced therapy designation from the FDA, and on May 31, 2023, we received priority medicines designation from the EMA. On September 12, 2023, we announced our alignment with the FDA on our pivotal study design for RP-A501 in DD and enrollment in the global study is ongoing.

Plakophilin-2 Arrhythmogenic Cardiomyopathy

Arrhythmogenic cardiomyopathy is an inheritable cardiac disorder that is characterized by a high propensity for arrhythmias and sudden death, a progressive loss of cardiac muscle mass, severe right ventricular dilation, dysplasia, and fibrofatty replacement of the myocardium. Most commonly, the cardiomyopathy initially manifests in the right ventricular free wall, so the disease was termed arrhythmogenic right ventricular dysplasia/cardiomyopathy. However, since left dominant and biventricular forms have also been observed, this has led more recently to the use of the term ACM. Mutations in the PKP2 gene comprise the most frequent genetically identified etiology of familial ACM. PKP2 encodes for the protein Plakophilin-2, which is a component of the desmosome, an intercellular complex involved in cell-cell adhesion. PKP2 is also involved in transcriptional regulation of calcium signaling between cardiomyocytes. Patients with mutations in PKP2 are typically heterozygous and demonstrate reduced expression of PKP2 in the myocardium. Mean presentation is at the age of 35, and patients have a very high lifetime risk of ventricular arrhythmias, structural ventricular abnormalities, and sudden cardiac death.

There are no specific available medical therapies available that have been shown to be highly effective for ACM, and current treatment protocols follow standard ventricular arrhythmia and cardiomyopathy guidelines, which involve lifestyle modifications (i.e. exercise limitation) and include drug treatments such as beta blockers, anti-arrhythmics and diuretics. The use of these therapies is driven by the arrhythmia burden and severity of cardiomyopathy. These therapies do not modify the course of the disease, and generally provide only symptomatic and/or palliative support. Upon diagnosis, a substantial percentage of patients receive an implantable cardiac defibrillator for primary or secondary prevention of ventricular arrhythmias and sudden cardiac death. Of note, ICDs are not curative, and breakthrough life-threatening arrythmias may persist with ongoing risk of death. Furthermore, ICDs do not prevent the progression to end-stage heart failure. ICD firings, although lifesaving, are physically and emotionally traumatic events. Patients whose condition progresses to end-stage heart failure are considered for cardiac transplantation which, while curative of underlying disease, is itself associated with significant morbidity and mortality. Hence there exists a high unmet medical need in this population. PKP2-ACM is estimated to have a prevalence of 50,000 patients in the U.S. and EU.

We currently have one AAV program targeting PKP2-ACM, RP-A601, which is a recombinant AAVrh.74 vector expressing PKP2a. PKP2-ACM is typically caused by heterozygous pathogenic mutations in the PKP2 gene resulting in reduced PKP2 expression in the myocardium. A once-administered gene therapy that addresses the root cause of the disease (PKP2 deficiency) early in the disease course, could mitigate the early electrical remodeling and diminish the risk of life-threatening arrhythmias and sudden cardiac death associated with ACM, potentially impeding the development of irreversible cardiac structural changes. Prevention of syncopal episodes, life-threatening arrythmias, sudden cardiac death, ICD shocks and the resulting anxiety, discomfort and hospitalizations is anticipated to result in a vastly improved quality of life and survival benefit. Furthermore, such an approach could spare patients the need for lifelong adherence to multiple arrhythmia and heart failure drugs that are nonspecific for PKP2-ACM and are associated with their own side effects, enabling patients an opportunity to live without exercise restrictions and with diminished concern for arrhythmias, palpitations, ICD shocks and progression to end-stage heart failure.

In May 2023, we presented preclinical efficacy data for RP-A601 at the American Society of Gene and Cell Therapy 26th Annual meeting. Nonclinical studies conducted by the Sponsor, RP-A601 have demonstrated efficacy in altering the natural history of PKP2-driven ACM. 100% of PKP2 cKO animals treated with the study drug exhibited extended survival to the longest timepoint measured (5 months), reduced cardiac dilation and fibrofatty replacement/fibrosis of the myocardium, preserved left ventricular function, and mitigation of the arrhythmic phenotype. Untreated PKP2 cKO mice had a median survival of approximately one month. These results were published in January 2024 in the journal Circulation: Genomic and Precision Medicine.

We have initiated a multi-center Phase 1 study for RP-A601. The multi-center Phase 1, dose escalation trial will evaluate the safety and preliminary efficacy of RP-A601 in at least six adult PKP2-ACM patients with ICDs and overall high risk for arrhythmias. The study will assess the impact of RP-A601 on PKP2 myocardial protein expression, cardiac biomarkers, and clinical predictors of life-threatening ventricular arrhythmias and sudden cardiac death. Patients in the dose-escalation trial will receive a single dose of RP-A601. The starting dose will be 8 x 1013 GC/kg.

Recently Achieved Milestones

We have achieved pre-clinical proof-of-concept for RP-A601 in an animal model representative of PKP2-ACM, completed pharmacology and GLP toxicology studies, produced GMP drug product, and developed an appropriate potency assay to support a Phase I study. On May 9, 2023, we announced FDA clearance of the IND, and on June 8, 2023, we announced receipt of FDA Fast Track and Orphan Drug Designations. On May 29, 2024, we announced receipt of Orphan Medicinal Product Designation from the European Commission. Enrollment in the U.S. Phase 1 study is ongoing.

BAG3 Dilated Cardiomyopathy

Dilated cardiomyopathy is the most common form of cardiomyopathy and is characterized by progressive thinning of the walls of the heart resulting in enlarged heart chambers that are unable to pump blood. A familial association of DCM can be identified in 20-50% of DCM patients, with up to 40% of familial patients having an identifiable genetic cause. Mutations in the BAG3 gene (BCL-2-associated athanogene 3) are among the more common pathogenic genetic variants observed in familial DCM and these variants are highly penetrant, with approximately 80% of individuals with disease-causing genetic variants in the BAG3 gene developing DCM at > 40 years of age. BAG3 protein is associated with a variety of cellular functions including cardiac contractility, protein quality control (as a co-chaperone), cardiomyocyte structural support and anti-apoptosis. BAG3 associated dilated cardiomyopathy (BAG3-DCM) leads to early onset, rapidly progressing heart failure and significant mortality and morbidity. We estimate that the prevalence of BAG3-associated DCM in the U.S. to be as many as 30,000 individuals.

Currently, DCM patients with a BAG3 mutation are treated with the standard of care for heart failure, which include angiotensin converting enzyme inhibitors, angiotensin receptor blockers, neprilysin inhibitors, beta-adrenergic receptor antagonists, or beta-blockers, aldosterone antagonists and/or diuretics, along with certain lifestyle changes, and do not address the underlying cause of disease. Patients who meet specific parameters may also undergo placement of an implantable cardioverter defibrillator, a cardiac resynchronization device or a combination of the two. There is no current therapy directly targeting the underlying mechanism of BAG3 associated DCM, and patients diagnosed with BAG3 associated DCM appear to progress to end-stage heart failure and death more rapidly than patients with DCM not associated with BAG3 variants. For example, approximately 19% of patients with BAG3-DCM require mechanical cardiac support, heart transplant, or have heart failure related death at 12 months after diagnosis, nearly twice the rate of similarly staged non-BAG3-DCM patients.

In December 2022 we completed our acquisition of Renovacor which provided Rocket with Renovacor’s recombinant AAV9-based gene therapy program designed to deliver a fully functional BAG3 gene to augment BAG3 protein levels in cardiomyocytes and slow or halt progression of BAG3-DCM. Initial proof of concept for AAV9-BAG3 has been demonstrated in studies of BAG3-knockout mouse models, which show treated mice have improved ejection fraction versus untreated knockout mice and comparable ejection fraction to walk test controls at timepoints 4- and 6-weeks post injection.

Recently Achieved Milestones

We are in the process of evaluating the optimal development pathway for this program and plan to submit an IND for BAG3-DCM in 2024.

Hematology Programs

Fanconi Anemia Complementation Group A

FA, a rare and life-threatening DNA-repair disorder, generally arises from a mutation in a single FA gene. An estimated 60% to 70% of cases arise from mutations in the Fanconi-A gene, which is the focus of our program. FA results in bone marrow failure, developmental abnormalities, myeloid leukemia, and other malignancies, often during the early years and decades of life. Bone marrow aplasia, which is bone marrow that no longer produces any or very few red and white blood cells and platelets leading to infections and bleeding, is the most frequent cause of early morbidity and mortality in FA, with a median onset before 10 years of age. Leukemia is the next most common cause of mortality, ultimately occurring in about 20% of patients later in life. Solid organ malignancies, such as head and neck cancers, can also occur, although at lower rates during the first two to three decades of life.

Although improvements in allogeneic (donor-mediated) hematopoietic stem cell transplant, currently the most frequently utilized therapy for FA, have resulted in frequent hematologic correction of the disorder, hematopoietic stem cell transplant is associated with both acute and long-term risks, including transplant-related mortality, graft failure, and graft versus host disease, a sometimes fatal side effect of allogeneic transplant characterized by painful ulcers in the GI tract, liver toxicity and skin rashes, as well as increased risk of subsequent cancers. Our gene therapy program in FA is designed to enable a minimally toxic hematologic correction using a patient’s own stem cells early in the disease course and administered without conditioning. We believe that the development of a broadly applicable autologous gene therapy can be transformative for these patients.

Each of our hematology programs utilize third-generation, self-inactivating LV to correct defects in patients’ HSCs, which are the cells found in bone marrow that are capable of generating blood cells over a patient’s lifetime. Defects in the genetic coding of HSCs can result in severe, and potentially life-threatening anemia, which is when a patient’s blood lacks enough properly functioning red blood cells to carry oxygen throughout the body. Stem cell defects can also result in severe and potentially life-threatening decreases in white blood cells resulting in susceptibility to infections, and in platelets responsible for blood clotting, which may result in severe and potentially life-threatening bleeding episodes. Patients with FA have a genetic defect that prevents the normal repair of genes and chromosomes within blood cells in the bone marrow, which frequently results in the development of bone marrow failure, acute myeloid leukemia, and myeloid dysplastic syndrome types of blood cancers. FA patients also typically present with congenital defects. The average lifespan of an FA patient is estimated to be 30 to 40 years. The prevalence of FA in the U.S. and EU is estimated to be approximately 4,000 patients in total. In light of the efficacy seen in non-conditioned patients, the addressable annual market opportunity is now believed to be 400 to 500 patients collectively in the U.S. and EU.

We currently have one ex vivo LV-based program targeting FA, RP-L102. RP-L102 is our lead LV-based program that we in-licensed from Centro de Investigaciones Energéticas, Medioambientales y Tecnológicas, which is a leading research institute in Madrid, Spain. Our Phase 2 registrational enabling clinical trials treating FA patients with RP-L102 at the Center for Definitive and Curative Medicine at Stanford University School of Medicine, Great Ormond Street Hospital in London and Hospital Infantil de Nino Jesus in Spain completed treatment. The trial has treated a total of 12 patients from the U.S. and EU. Two additional patients were treated in the U.S. Phase 1 study at Stanford such that a total of 14 patients have received RP-L102 on Rocket-sponsored clinical trials. Patients receive a single intravenous infusion of RP-L102 that utilizes fresh cells and “Process B” which incorporates a modified stem cell enrichment process, transduction enhancers, as well as commercial-grade vector and final drug product.

Resistance to mitomycin-C, a DNA damaging agent, in bone marrow stem cells at a minimum time point of one year post treatment is the primary endpoint for our ongoing Phase 2 study. Per agreement with the FDA and EMA, engraftment leading to bone marrow restoration exceeding a 10% mitomycin-C resistance threshold could support a marketing application for approval.

In May 2023, we presented updated clinical data for RP-L102 at the ASGCT 26th Annual Meeting. As of the data cut-off (April 17, 2023), RP-L102 conferred sustained genetic correction in eight of 12 evaluable patients and comprehensive phenotypic correction in seven of 12 evaluable patients with ≥12 months of follow up as demonstrated by increased resistance to mitomycin-C (MMC) in bone marrow-derived colony forming cells and hematologic stabilization. The safety profile of RP-L102 has been highly favorable, and the treatment, administered without any cytotoxic conditioning, has been well tolerated. No signs of bone marrow dysplasia, clonal dominance or insertional mutagenesis related to RP-L102 have been observed. Polyclonal integration patterns have been observed in each of the seven patients with phenotypic, genetic, and hematologic evidence of engraftment. Pivotal trial enrollment and treatment have been completed.

In May 2024, we provided an incremental clinical update at the ASGCT 27th Annual Meeting (data cut-off September 11, 2023). RP-L102 continued to demonstrate sustained genetic correction, phenotypic correction, and hematologic stability in eight of 12 patients with greater than 12 months of follow-up. RP-L102 continued to be well tolerated with no significant safety signals.

Anticipated Milestones

Pivotal trial enrollment and treatment have been completed.

On April 2, 2024 we announced that the European Medicines Agency accepted our Marketing Authorization Application for RP-L102. Regulatory filings and review for RP-L102 for the treatment of FA are on track with health authorities in the U.S. and Europe.

Leukocyte Adhesion Deficiency-I

LAD-I is a rare autosomal recessive disorder of white blood cell adhesion and migration, resulting from mutations in the ITGB2 gene encoding for the Beta-2 Integrin component, CD18. Deficiencies in CD18 result in an impaired ability for neutrophils (a subset of infection-fighting white blood cells) to leave blood vessels and enter tissues where these cells are needed to combat infections. As is the case with many rare diseases, accurate estimates of incidence are difficult to confirm; however, several hundred cases across the spectrum of severity have been reported to date. Most LAD-I patients are believed to have the severe form of the disease. Severe LAD-I is notable for recurrent, life-threatening infections and substantial infant mortality in patients who do not receive an allogeneic hematopoietic stem cell transplant. Mortality for severe LAD-I has been reported as 60 to 75% by age two in the absence of allogeneic HCST.

We currently have one ex vivo program targeting LAD-I, RP-L201. RP-L201 is a clinical program that we in-licensed from CIEMAT. UCLA and its Eli and Edythe Broad Center of Regenerative Medicine and Stem Cell Research is serving as the lead U.S. clinical research center for the registrational clinical trial for LAD-I, and HNJ and GOSH are serving as the lead clinical sites in Spain and London, respectively. This study has received a $5.9 million CLIN2 grant award from the CIRM to support the clinical development of gene therapy for LAD-I.

The open-label, single-arm, Phase 1/2 registration-enabling clinical trial of RP-L201 has treated nine severe LAD-I patients to assess the safety and tolerability of RP-L201. The first patient was treated at UCLA with RP-L201 in the third quarter of 2019. Enrollment is now complete in both the Phase 1 and 2 portions of the study; nine patients have received RP-L201 at 3 investigative centers in the U.S. and Europe.

In December 2022, we presented positive clinical data at the 64th Annual Meeting of ASH. The presentation included previously disclosed top-line data at three to 24 months of follow-up after RP-L201 infusion for all patients and overall survival data for seven patients at 12 months or longer after infusion. We observed 100% overall survival at 12 months post-infusion via Kaplan Meier estimate and a statistically significant reduction in all hospitalizations, infection and inflammatory-related hospitalizations and prolonged hospitalizations for all nine LAD-I patients with three to 24 months of available follow-up. All patients, aged three months to nine years, demonstrated sustained CD18 restoration and expression on more than 10% of neutrophils (range: 20%-87%, median: 56%). Data also shows evidence of resolution of LAD-I-related skin rash and restoration of wound repair capabilities. The safety profile of RP-L201 has been highly favorable in all patients with no RP-L201-related serious adverse events to date. Adverse events related to other study procedures, including busulfan conditioning, have been previously disclosed and consistent with the tolerability profiles of those agents and procedures.

In May 2023, at the ASGCT 26th Annual Meeting, we presented top-line data at 12 to 24 months of follow-up for all nine patients in our Phase 1/2 clinical trial that showed 100% overall survival at 12 months post-infusion. All patients continued to demonstrate evidence of resolution of LAD-I-related skin rash and restoration of wound repair capabilities, and the safety profile of RP-L201 remains highly favorable with follow-up of 12-36 months. No evidence of replication-competent lentivirus has been observed. Insertion site analyses indicate highly polyclonal integration patterns across the entire cohort.

In May 2024 we presented additional follow-up data at the ASGCT 27th Annual Meeting, which included 18-45 month follow-up data (data cut-off July 24, 2023). We continue to observe 100% survival in the absence of allogeneic transplant, and all patients enrolled at less than 12 months of age had surpassed 24 months without allogeneic transplant. When compared with pre-treatment history, data showed substantial decreases in the incidences of significant infections requiring hospitalization or intravenous antimicrobials, combined with evidence of resolution of LAD-I-related skin and periodontal lesions and restoration of wound repair capabilities. Furthermore, RP-L201 continued to be well tolerated with no new safety events related to the treatment.

Recently Achieved and Anticipated Milestones

A BLA filing for RP-L201 was accepted by the FDA with priority review in October of 2023 with an initial Prescription Drug User Fee Act date of March 31, 2024. On February 13, 2024, the review time was extended by three months, to June 30, 2024, to allow additional time to review clarifying Chemistry, Manufacturing, and Controls information submitted by Rocket in response to FDA information requests. On June 28, 2024 we announced that the FDA issued a CRL in response to the BLA wherein the FDA requested limited additional CMC information to complete its review. We are in the process of submitting the additional requested information for review.

Pyruvate Kinase Deficiency

Red blood cell PKD is a rare autosomal recessive disorder resulting from mutations in the pyruvate kinase L/R gene encoding for a component of the red blood cell glycolytic pathway. PKD is characterized by chronic non-spherocytic hemolytic anemia, a disorder in which red blood cells do not assume a normal spherical shape and are broken down, leading to decreased ability to carry oxygen to cells, with anemia severity that can range from mild (asymptomatic) to severe forms that may result in childhood mortality or a requirement for frequent, lifelong red blood cell transfusions. The pediatric population is the most commonly and severely affected subgroup of patients with PKD, and PKD often results in splenomegaly (abnormal enlargement of the spleen), jaundice and chronic iron overload which is likely the result of both chronic hemolysis and the red blood cell transfusions used to treat the disease. The variability in anemia severity is believed to arise in part from the large number of diverse mutations that may affect the pyruvate kinase L/R gene. Estimates of disease incidence have ranged between 3.2 and 51 cases per million in the white U.S. and EU population. Industry estimates suggest at least 2,500 cases in the U.S. and EU have already been diagnosed. Market research indicates the application of gene therapy to broader populations could increase the market opportunity from approximately 250 to 500 patients per year.

We currently have one ex vivo LV-based program targeting PKD, RP-L301. RP-L301 is a clinical stage program that we in-licensed from CIEMAT.

We are conducting a global Phase 1 open-label, single-arm, clinical study has enrolled 2 adult patients and 2 pediatric patients (age 8-17) in the U.S. and Europe and is intended to assess the safety, tolerability, and preliminary activity of RP-L301. Stanford serves as the lead site in the U.S. for adult and pediatric patients, HNJ serves as the lead site in Europe for pediatrics, and Hospital Universitario Fundación Jiménez Díaz serves as the lead site in Europe for adult patients. Both adult and pediatric enrollment is completed in the Phase 1 study.

In May 2023, we presented positive updated clinical data at the ASGCT 26th Annual Meeting (data cut-off May 3, 2023), which included up to 30 months of follow-up from the two treated adult patients and early clinical data from the first pediatric patient treated with RP-L301. Robust and sustained efficacy was observed in both adult patients at up to 30 months post-infusion evidenced by normalized hemoglobin (from baseline pre-treatment levels in the 7.0-7.5 g/dL range), improved hemolysis parameters, and red blood cell transfusion independence. Furthermore, both adult patients reported improved quality of life with documented improvements via formal quality of life assessments. The safety profile continues to appear highly favorable, with no RP-L301-related serious adverse events in either of the adult patients. Insertion site analyses in peripheral blood and bone marrow in both adult patients through 24 months post-RP-L301 demonstrated highly polyclonal patterns and there has been no evidence of insertional mutagenesis. The first pediatric patient infusion of RP-L301 was well tolerated, with engraftment achieved at day +15, hospital discharge less than one month following infusion, no RP-L301 related serious adverse events and early signs of efficacy. There were no red blood cell transfusion requirements following engraftment. Both adult and pediatric enrollment is completed in the Phase 1 study.

In October 2023, we presented positive updated clinical data at the 30th Annual Congress at ESGCT (data cut-off October 9, 2023), including up to 36 months of follow-up in the adult cohort and more limited follow-up of 6 months in the pediatric cohort. Sustained efficacy has been demonstrated in adult cohort including hemoglobin normalization, transfusion independence, decreased hemolysis, and quality of life improvement; hemoglobin improvement relative to pre-treatment baseline has been observed in pediatric cohort. The safety profile remains favorable.

In February 2024, we presented further clinical updates at the ASGCT 27th Annual Meeting (data cut-off February 5, 2024), which included 36 months of follow-up on the two adult patients and 12 months of follow-up on the two pediatric patients. Sustained and clinically meaningful hemoglobin improvement observed in all patients including hemoglobin normalization in three of four patients. No patients have required red blood cell transfusion following neutrophil engraftment. Improvements in hemoglobin supported by improved markers of hemolysis and quality of life have been observed. RP-L301 remains well-tolerated, with no drug-related serious adverse events. Insertion site analyses in the peripheral blood and bone marrow for both adult patients through 36 months post-RP-L301 continued to demonstrate highly polyclonal patterns with no clonal dominance or insertional mutagenesis.

Recently Achieved Milestones

In early 2023, we announced receipt of FDA regenerative medicine advanced therapy designation and EMA priority medicines designation for RP-L301 based on the robust efficacy observed in the Phase 1 treated patients.

We have reached agreement with FDA on study design of Phase 2 pivotal trial of RP-L301. Based on positive safety and efficacy data from the Phase 1 study, we have aligned with the FDA on the pivotal study design to support accelerated approval and are initiating a 10-patient, single-arm Phase 2 pivotal trial with a primary endpoint of ≥1.5 point Hgb improvement at 12 months.

cGMP Manufacturing

Our 103,720 square foot manufacturing facility in Cranbury, New Jersey has been scaled up to manufacture AAV drug product for our Phase 2 pivotal study in DD. The facility also houses lab space for research & development and quality. We reached an understanding with the FDA on chemistry, manufacturing, and controls requirements to start AAV cGMP manufacturing at our in-house facility as well as potency assay plans for a Phase 2 pivotal trial in DD.

Strategy

We seek to bring hope and relief to patients with devastating, undertreated, rare pediatric diseases through the development and commercialization of potentially curative first-in-class gene therapies. To achieve these objectives, we intend to develop into a fully-integrated biotechnology company. In the near and medium-term, we intend to develop our first-in-class product candidates, which are targeting devastating diseases with substantial unmet need, develop proprietary in-house analytics and manufacturing capabilities and continue to commence registration trials for our currently planned programs. In the medium and long-term, pending favorable data, we expect to submit BLAs for the rest of our suite of clinical programs, and establish our gene therapy platform and expand our pipeline to target additional indications that we believe to be potentially compatible with our gene therapy technologies. In addition, during that time, we believe that our currently planned programs will become eligible for priority review vouchers from the FDA that provide for expedited review. We have assembled a leadership and research team with expertise in cell and gene therapy, rare disease drug development and product approval.

We believe that our competitive advantage lies in our disease-based selection approach, a rigorous process with defined criteria to identify target diseases. We believe that this approach to asset development differentiates us as a gene therapy company and potentially provides us with a first-mover advantage.

Financial Overview

Since our inception, we have devoted substantially all of our resources to organizing and staffing the company, business planning, raising capital, acquiring or discovering product candidates and securing related intellectual property rights, conducting discovery, R&D activities for our product candidates and planning for potential commercialization. We do not have any products approved for sale and have not generated any revenue from product sales. From inception through June 30, 2024, we raised net cash proceeds of approximately $1.0 billion from investors through both equity and convertible debt financing to fund operating activities.

Revenue

To date, we have not generated any revenue from any sources, including from product sales, and we do not expect to generate any revenue from the sale of products in the near future. If our development efforts for product candidates are successful and result in regulatory approval or license agreements with third parties, we may generate revenue in the future from product sales.

Research and Development Expenses

Our R&D program expenses consist primarily of external costs incurred for the development of our product candidates. These expenses include:

•

expenses incurred under agreements with research institutions and consultants that conduct R&D activities including process development, preclinical, and clinical activities on our behalf;

•

costs related to process development, production of preclinical and clinical materials, including fees paid to contract manufacturers and manufacturing input costs for use in internal manufacturing processes;

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consultants supporting process development and regulatory activities; and

•

costs related to in-licensing of rights to develop and commercialize our product candidate portfolio.

We recognize external development costs based on contractual payment schedules aligned with program activities, invoices for work incurred, and milestones that correspond with costs incurred by the third parties. Nonrefundable advance payments for goods or services to be received in the future for use in R&D activities are recorded as prepaid expenses.

Our direct R&D expenses are tracked on a program-by-program basis for product candidates and consist primarily of external costs, such as research collaborations and third-party manufacturing agreements associated with our preclinical research, process development, manufacturing, and clinical development activities. Our direct R&D expenses by program also include fees incurred under license agreements. Our personnel, non-program and unallocated program expenses include costs associated with activities performed by our internal R&D organization and generally benefit multiple programs. These costs are not separately allocated by product candidate and consist primarily of:

•

salaries and personnel-related costs, including benefits, travel, and stock-based compensation, for our scientific personnel performing R&D activities;

•

facilities and other expenses, which include expenses for rent and maintenance of facilities, and depreciation expense; and

•

laboratory supplies and equipment used for internal R&D activities.

We allocate salary and benefit costs directly related to specific programs. We do not allocate personnel-related discretionary bonus or stock-based compensation costs, costs associated with our general discovery platform improvements, depreciation or other indirect costs that are deployed across multiple projects under development and, as such, the costs are separately classified as other R&D expenses.

The following table presents R&D expenses tracked on a program-by-program basis as well as by type and nature of expense for the three and six months ended June 30, 2024 and 2023:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Direct Expenses:
Danon Disease (AAV) RP-A501	$	5,649	$	6,993	$	12,470	$	13,396
Plakophilin-2 Arrhythmogenic Cardiomyopathy (AAV) RP-A601		1,314		-		2,507		-
Leukocyte Adhesion Deficiency (LV) RP-L201		2,932		7,299		8,067		13,140
Fanconi Anemia (LV) RP-L102		5,915		6,740		9,435		13,288
Pyruvate Kinase Deficiency (LV) RP-L301		4,302		1,288		7,086		1,587
Other product candidates		2,907		5,021		5,293		8,460
Total direct expenses		23,019		27,341		44,858		49,871
Unallocated Expenses:
Employee compensation	$	12,397	$	11,687	$	26,014	$	22,897
Stock based compensation expense		4,885		4,638		9,522		8,457
Depreciation and amortization expense		1,553		1,183		3,020		2,320
Laboratory and related expenses		1,210		4,137		2,244		9,239
Professional fees		2,118		933		3,266		1,918
Other expenses		1,163		1,464		2,648		3,052
Total other research and development expenses		23,326		24,042		46,714		47,883
Total research and development expense	$	46,345	$	51,383	$	91,572	$	97,754

We cannot determine with certainty the duration and costs to complete current or future clinical studies of product candidates or if, when, or to what extent we will generate revenues from the commercialization and sale of any of our product candidates that obtain regulatory approval. We may never succeed in achieving regulatory approval for any of our product candidates. The duration, costs, and timing of clinical studies and development of product candidates will depend on a variety of factors, including:

•

the scope, rate of progress, and expense of ongoing clinical studies as well as any clinical studies and other R&D activities that we undertake in the future;

•

future clinical study results;

•

uncertainties in clinical study enrollment rates;

•

changing standards for regulatory approval; and

•

the timing and receipt of any regulatory approvals.

We expect R&D expenses to increase for the foreseeable future as we continue to invest in R&D activities related to developing product candidates, including investments in manufacturing, as our programs advance into later stages of development and as we conduct additional clinical trials. The process of conducting the necessary clinical research to obtain regulatory approval is costly and time-consuming, and the successful development of product candidates is highly uncertain. As a result, we are unable to determine the duration and completion costs of R&D projects or when and to what extent we will generate revenue from the commercialization and sale of any of our product candidates.

Our future R&D expenses will depend on the clinical success of our product candidates, as well as ongoing assessments of the commercial potential of such product candidates. In addition, we cannot forecast with any degree of certainty which product candidates may be subject to future collaborations, when such arrangements will be secured, if at all, and to what degree such arrangements would affect our development plans and capital requirements. We expect our R&D expenses to increase for the foreseeable future as we seek to further development of our product candidates.

The successful development and commercialization of our product candidates is highly uncertain. This is due to the numerous risks and uncertainties associated with product development and commercialization, including the uncertainty of:

•

the scope, progress, outcome and costs of our clinical trials and other R&D activities;

•

the efficacy and potential advantages of our product candidates compared to alternative treatments, including any standard of care;

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the market acceptance of our product candidates;

•

obtaining, maintaining, defending, and enforcing patent claims and other intellectual property rights;

•

significant and changing government regulation; and

•

the timing, receipt, and terms of any marketing approvals.

A change in the outcome of any of these variables with respect to the development of our product candidates that we may develop could mean a significant change in the costs and timing associated with the development of our product candidates. For example, if the FDA or another regulatory authority were to require us to conduct clinical trials or other testing beyond those that we currently contemplate for the completion of clinical development of any of our product candidates that we may develop or if we experience significant delays in enrollment in any of our clinical trials, we could be required to expend significant additional financial resources and time on the completion of clinical development of that product candidate.

General and Administrative Expenses

General and administrative expenses consist primarily of salaries and related benefit costs for personnel, including stock-based compensation and travel expenses for our employees in commercial, executive, operational, finance, legal, business development, and human resource functions. In addition, other significant general and administrative expenses include professional fees for legal, consulting, investor and public relations, auditing, and tax services as well as other expenses for rent and maintenance of facilities, insurance and other supplies used in general and administrative activities. We expect general and administrative expenses to continue to increase for the foreseeable future due to anticipated increases in headcount to support the continued advancement of our product candidates and our progression to commercial operations. We also anticipate that as we continue to operate as a public company with increasing complexity, we will continue to incur increased accounting, audit, legal, regulatory, compliance and director and officer insurance costs as well as investor and public relations expenses.

Interest Expense

Interest expense for the three and six months ended June 30, 2024 and 2023 was related to our financing lease obligation for our Cranbury, NJ facility.

Interest and Other Income

Interest and other income related to interest earned from investments and cash equivalents and reduced fair value of warrant liability.

Critical Accounting Policies and Significant Judgments and Estimates

There have been no material changes in our critical accounting policies and estimates in the preparation of our consolidated financial statements during the three months ended June 30, 2024 compared to those disclosed in our 2023 Form 10-K.

Results of Operations

Comparison of the Three Months Ended June 30, 2024 and 2023


	Three Months Ended June 30,
	2024			2023			Change
Operating expenses:
Research and development	$	46,345		$	51,383		$	(5,038	)
General and administrative		27,367			17,374			9,993
Total operating expenses		73,712			68,757			4,955
Loss from operations		(73,712	)		(68,757	)		(4,955	)
Interest expense		(471	)		(468	)		(3	)
Interest and other income, net		2,294			846			1,448
Accretion of discount on investments, net		2,243			2,678			(435	)
Total other income, net		4,066			3,056			1,010
Net loss	$	(69,646	)	$	(65,701	)	$	(3,945	)

Research and Development Expenses

R&D expenses decreased $5.0 million to $46.3 million for the three months ended June 30, 2024 compared to the three months ended June 30, 2023. The decrease in R&D expenses was primarily driven by decreases in manufacturing and development and direct costs of $9.1 million. Decreases were partially offset by increases in professional fees of $2.3 million and clinical trial costs of $0.8 million.

General and Administrative Expenses

G&A expenses increased $10.0 million to $27.4 million for the three months ended June 30, 2024, compared to the three months ended June 30, 2023. The increase in G&A expenses was primarily driven by increases in commercial preparation related expenses of $6.2 million, legal expenses of $1.8 million, and non-cash stock compensation expense of $0.8 million.

Other Income, Net

Other income increased $1.0 million to $4.1 million for the three months ended June 30, 2024, compared to the three months ended June 30, 2023 primarily due to an increase in interest and other income, net, and due to decreased fair value of warrant liability of $0.9 million.

Comparison of the Six Months Ended June 30, 2024 and 2023


	Six Months Ended June 30,
	2024			2023			Change
Operating expenses:
Research and development	$	91,572		$	97,754		$	(6,182	)
General and administrative		49,515			33,197			16,318
Total operating expenses		141,087			130,951			10,136
Loss from operations		(141,087	)		(130,951	)		(10,136	)
Interest expense		(942	)		(936	)		(6	)
Interest and other income, net		5,323			2,754			2,569
Accretion of discount and amortization of premium on investments, net		5,006			5,097			(91	)
Total other income, net		9,387			6,915			2,472
Net loss	$	(131,700	)	$	(124,036	)	$	(7,664	)

Research and Development Expenses

R&D expenses decreased $6.2 million to $91.6 million for the six months ended June 30, 2024, compared to the six months ended June 30, 2023. The decrease in R&D expenses was primarily driven by decreases in manufacturing and development and direct costs of $14.9 million. Decreases were partially offset by increases in the costs for compensation and benefits of $1.2 million due to increased R&D headcount, professional fees of $3.4 million, laboratory supplies of $0.6 million, non-cash stock compensation expense of $1.1 million, and clinical trial costs of $1.4 million.

General and Administrative Expenses

G&A expenses increased $16.3 million to $49.5 million for the six months ended June 30, 2024, compared to the six months ended June 30, 2023. The increase in G&A expenses was primarily driven by increases in commercial preparation related expenses of $9.5 million, legal expenses of $3.3 million, and non-cash stock compensation expense of $1.4 million.

Other Income, Net

Other income increased $2.5 million to $9.4 million for the six months ended June 30, 2024, compared to the six months ended June 30, 2023. The increase in other income was primarily driven by an increase increase in interest income of $1.0 million and the decreased fair value of warrant liability of $1.3 million.

Liquidity and Capital Resources

We have not generated any revenue and have incurred losses since inception. Operations of the Company are subject to certain risks and uncertainties, including, among others, those related to drug candidate development, technology and data security, patents and proprietary rights, our lack of commercial manufacturing marketing or sales experience, dependency on key personnel, compliance with government regulations and the need to obtain additional financing. Drug candidates currently under development will require significant additional R&D efforts, including extensive preclinical and clinical testing and regulatory approval, prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel infrastructure, and extensive compliance-reporting capabilities.

Our drug candidates are in the development and clinical stage. There can be no assurance that our R&D will be successfully completed, that adequate protection for our intellectual property will be obtained, that any products developed will obtain necessary government approval or that any approved products will be commercially viable. Even if our product development efforts are successful, it is uncertain when, if ever, we will generate significant revenue from product sales. We operate in an environment of rapid change in technology and substantial competition from pharmaceutical and biotechnology companies.

Our consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets and the satisfaction of liabilities in the ordinary course of business. Rocket has incurred net losses and negative cash flows from its operations each year since inception. We incurred net losses of $131.7 million for the six months ended June 30, 2024, and $245.6 million for the year ended December 31, 2023. We have experienced negative cash flows from operations and as of June 30, 2024 and December 31, 2023, we had an accumulated deficit of $1.09 billion and $959.4 million, respectively. As of June 30, 2024, we had $278.8 million of cash, cash equivalents and investments. Excluded from the $278.8 million of cash, cash equivalent and investments are receivables from maturity of securities that have yet to be received of $8.1 million that were recorded as part of prepaid expenses and other current assets. The net balance of cash, cash equivalent and investments balance when adjusting for this receivable would have been $286.9 million. We expect such resources would be sufficient to fund our operating expenses and capital expenditure requirements into 2026. We have funded our operations primarily through the sale of equity.

In the longer term, our future viability is dependent on our ability to generate cash from operating activities or to raise additional capital to finance our operations. If we raise additional funds by issuing equity securities, our stockholders will experience dilution. Any future debt financing into which we enter may impose upon us additional covenants that restrict our operations, including limitations on our ability to incur liens or additional debt, pay dividends, repurchase our common stock, make certain investments and engage in certain merger, consolidation, or asset sale transactions. Any debt financing or additional equity that we raise may contain terms that are not favorable to us or our stockholders. Our failure to raise capital as and when needed could have a negative impact on our financial condition and ability to pursue our business strategies.

Cash Flows

The following table summarizes our cash flows from operating, investing and financing activities, in thousands, for each of the periods presented:


	Six Months Ended June 30,
	2024			2023
Net cash used in operating activities	$	(110,679	)	$	(108,429	)
Net cash provided by (used in) investing activities		90,658			(5,515	)
Net cash provided by financing activities		2,714			18,525
Net decrease in cash, cash equivalents and restricted cash	$	(17,307	)	$	(95,419	)

Operating Activities

During the six months ended June 30, 2024, operating activities used $110.7 million of cash and cash equivalents, primarily resulting from our net loss of $131.7 million offset by net non-cash charges of $21.2 million, including non-cash stock-based compensation expense of $21.6 million, depreciation and amortization expense of $4.6 million, partially offset by accretion of discount on investments of $5.0 million. Changes in our operating assets and liabilities for the three months ended June 30, 2024 included an increase in accounts payable and accrued expenses of $2.1 million, an increase in our prepaid expenses of $0.7 million, and a decrease in other liabilities of $1.7 million.

During the six months ended June 30, 2023, operating activities used $108.4 million of cash and cash equivalents, primarily resulting from our net loss of $124.0 million offset by net non-cash charges of $17.7 million, including non-cash stock-based compensation expense of $19.2 million, depreciation and amortization expense of $3.4 million, partially offset by accretion of discount on investments of $4.8 million. Changes in our operating assets and liabilities for the six months ended June 30, 2023 included a decrease in accounts payable and accrued expenses of $4.5 million, a decrease in our prepaid expenses of $2.7 million, and a decrease in other liabilities of $0.5 million.

Investing Activities

During the six months ended June 30, 2024, net cash provided by investing activities was $90.7 million, primarily resulting from proceeds of $197.1 million from the maturities of investments, offset by purchases of investments of $102.5 million, and purchases of property and equipment of $4.0 million.

During the six months ended June 30, 2023, net cash used in investing activities was $5.5 million, primarily resulting from proceeds of $170.6 million from the maturities of investments, offset by purchases of investments of $168.9 million, and purchases of property and equipment of $7.1 million.

Financing Activities

During the six months ended June 30, 2024, net cash provided by financing activities was $2.7 million, consisting of proceeds from the exercise of stock options.

During the six months ended June 30, 2023, net cash provided by financing activities was $18.5 million, consisting primarily of proceeds of $17.2 million from the sale of shares through our at-the-market facility and $1.3 million from the exercise of stock options.

Contractual Obligations and Commitments

Information regarding contractual obligations and commitments may be found in Note 13 of our unaudited interim consolidated financial statements in this Quarterly Report on Form 10-Q. We do not have any off-balance sheet arrangements that are material or reasonably likely to become material to our financial condition or results of operations.

Recently Issued Accounting Pronouncements

There were no recent accounting pronouncements that impacted the Company, or which had a significant effect on the consolidated financial statements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Our exposure to market risk is principally confined to our cash, cash equivalents and marketable securities. We invest in U.S. treasury securities, corporate and agency bonds, which as of June 30, 2024, were classified as available-for-sale securities. We maintain our cash and cash equivalent balances with high-quality financial institutions and, consequently, we believe that such funds are subject to minimal credit risk. Our investment policy limits the amounts that we may invest in any one type of investment and requires all investments held by the Company to be at least AA-/Aa3 rated, thereby reducing credit risk exposure.

Our available-for-sale securities are subject to interest rate risk and will fall in value if market interest rates increase. If market interest rates were to increase immediately and uniformly by 100 basis points, or one percentage point, from levels at June 30, 2024, the net effect on the net fair value of our interest-sensitive marketable securities would have resulted in a hypothetical decline of $0.9 million. While we believe our cash, cash equivalents, and marketable securities do not contain excessive risk, we cannot provide absolute assurance that, in the future, our investments will not be subject to adverse changes in market value. In addition, we maintain significant amounts of cash, cash equivalents, and marketable securities at one or more financial institutions that are in excess of federally insured limits. Given the potential instability of financial institutions, we cannot provide assurance that we will not experience losses on these deposits. We do not utilize interest rate hedging agreements or other interest rate derivative instruments.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our principal executive and our principal financial officer, evaluated, as of the end of the period covered by this Quarterly Report on Form 10-Q, the effectiveness of our disclosure controls and procedures. Based on that evaluation of our disclosure controls and procedures as of June 30, 2024, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures as of such date were effective at the reasonable assurance level. The term “disclosure controls and procedures,” as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act are recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms.

Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and our management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Inherent Limitations of Internal Controls

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, we may be subject to various legal proceedings and claims that arise in the ordinary course of our business activities. Although the results of litigation and claims cannot be predicted with certainty, we do not believe we are party to any other claim or litigation the outcome of which, if determined adversely to us, would individually or in the aggregate be reasonably expected to have a material adverse effect on its business. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors.

Item 1A. Risk Factors

Our material risk factors are disclosed in Item 1A of our 2023 Form 10-K. There have been no material changes from the risk factors previously disclosed in such filing.

Item 2. Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

During the three months ended June 30, 2024, none of our directors or officers adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

Item 6. Exhibits


Exhibit Number	Description of Exhibit
2.1	Agreement and Plan of Merger and Reorganization, dated as of September 12, 2017, by and among Inotek Pharmaceuticals Corporation, Rocket Pharmaceuticals, Ltd., and Rome Merger Sub (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8- K (001-36829), filed with the SEC on September 13, 2017)
2.2	Agreement and Plan of Merger, dated September 19, 2022, by and among Rocket Pharmaceuticals, Renovacor, Inc., Zebrafish Merger Sub, Inc. and Zebrafish Merger Sub II, LLC (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K (001-36829), filed with the SEC on September 20, 2022)
3.1	Seventh Amended and Restated Certificate of Incorporation of Rocket Pharmaceuticals, Inc., effective as of February 23, 2015 (incorporated by reference to Exhibit 3.1 to the Company’s Annual Report on Form 10-K (001-36829), filed with the SEC on March 31, 2015)
3.2	Certificate of Amendment (Reverse Stock Split) to the Seventh Amended and Restated Certificate of Incorporation of the Registrant, effective as of January 4, 2018 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K (001-36829), filed with the SEC on January 5, 2018)
3.3	Certificate of Amendment (Name Change) to the Seventh Amended and Restated Certificate of Incorporation of the Registrant, effective January 4, 2018 (incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K (001-36829), filed with the SEC on January 5, 2018)
3.4	Certificate of Amendment (Declassify Board of Directors) to the Seventh Amended and Restated Certificate of Incorporation of the Registrant, effective as of June 25, 2018 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K (001-36829), filed with the SEC on June 25, 2019
3.5	Certificate of Amendment (Increase Authorized Shares) to the Seventh Amended and Restated Certificate of Incorporation of the Registrant, effective as of June 20, 2024 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K (001-36829), filed with the SEC on June 20, 2024
3.6	Amended and Restated By-Laws of Rocket Pharmaceuticals, Inc., effective as of March 29, 2018 (incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K (001-36829), filed with the SEC on April 4, 2018)
4.1	Form of Pre-Funded Warrant (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K (001-36829), filed with the SEC on September 15, 2023)
31.1*	Certification of Principal Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*	Certification of Principal Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1**	Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS	Inline XBRL Instance Document
101.SCH	Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents.
104	Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document)

* Filed herewith.

# Indicates management contract or compensatory plan.

** The certification furnished in Exhibit 32.1 hereto is deemed to be furnished with this Quarterly Report on Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, except to the extent that the Registrant specifically incorporates it by reference

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	ROCKET PHARMACEUTICALS, INC.

August 6, 2024	By:	/s/ Gaurav Shah, MD
		Gaurav Shah, MD
		Chief Executive Officer and Director
		(Principal Executive Officer)

August 6, 2024	By:	/s/ Aaron Ondrey
		Aaron Ondrey
		Chief Financial Officer
		(Principal Financial Officer)

Exhibit 31.1

CERTIFICATIONS

I, Gaurav Shah, MD, certify that:

I have reviewed this quarterly report on Form 10-Q for the period ended June 30, 2024 of Rocket Pharmaceuticals, Inc.;

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: August 6, 2024	By:	/s/ Gaurav Shah, MD
		Gaurav Shah, MD
		Chief Executive Officer and Director
		(Principal Executive Officer)

Exhibit 31.2

CERTIFICATIONS

I, Aaron Ondrey, certify that:

I have reviewed this quarterly report on Form 10-Q for the period ended June 30, 2024 of Rocket Pharmaceuticals, Inc.;

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: August 6, 2024	By:	/s/ Aaron Ondrey
		Aaron Ondrey
		Chief Financial Officer
		(Principal Financial Officer)

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report on Form 10-Q of Rocket Pharmaceuticals, Inc. (the “Company”) for the period ended June 30, 2024, as filed with the United States Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned officers hereby certifies, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that to his knowledge:

the Report which this statement accompanies fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

     Date: August 6, 2024

     By: 

     /s/ Gaurav Shah, MD

      
     Gaurav Shah, MD
Chief Executive Officer and Director
(Principal Executive Officer)

     Date: August 6, 2024

     By: 

     /s/ Aaron Ondrey

      
     Aaron Ondrey
Chief Financial Officer
(Principal Financial Officer)

Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2024	Aug. 02, 2024
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2024
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q2
Document Transition Report	false
Entity File Number	001-36829
Entity Registrant Name	Rocket Pharmaceuticals, Inc.
Entity Central Index Key	0001281895
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	04-3475813
Entity Address, Address Line One	9 Cedarbrook Drive
Entity Address, City or Town	Cranbury
Entity Address, State or Province	NJ
Entity Address, Postal Zip Code	08512
City Area Code	609
Local Phone Number	659-8001
Title of 12(b) Security	Common Stock, $0.01 par value per share
Trading Symbol	RCKT
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		90,975,859

Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 38,607	$ 55,904
Investments	240,218	317,271
Prepaid expenses and other current assets	13,900	5,047
Total current assets	292,725	378,222
Property and equipment, net	39,548	39,172
Goodwill	39,154	39,154
Intangible assets	25,150	25,150
Restricted cash	1,362	1,372
Deposits	481	533
Investments	0	34,320
Operating lease right-of-use assets, net	4,551	3,901
Finance lease right-of-use asset, net	43,440	44,517
Total assets	446,411	566,341
Current liabilities:
Accounts payable and accrued expenses	34,733	45,789
Operating lease liabilities, current	1,033	925
Finance lease liability, current	1,826	1,791
Total current liabilities	37,592	48,505
Operating lease liabilities, non-current	3,565	2,973
Finance lease liability, non-current	19,374	19,353
Other liabilities	1,245	2,936
Total liabilities	61,776	73,767
Commitments and contingencies (Note 13)
Stockholders' equity:
Common stock, $0.01 par value, 180,000,000 shares authorized; 90,956,613 and 90,282,267 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively	910	903
Additional paid-in capital	1,475,013	1,450,722
Accumulated other comprehensive income (loss)	(218)	319
Accumulated deficit	(1,091,070)	(959,370)
Total stockholders' equity	384,635	492,574
Total liabilities and stockholders' equity	446,411	566,341
Series A Convertible Preferred Shares
Stockholders' equity:
Preferred stock
Series B Convertible Preferred Shares
Stockholders' equity:
Preferred stock

Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2024	Dec. 31, 2023
Stockholders' equity:
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	5,000,000	5,000,000
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	180,000,000	180,000,000
Common stock, shares issued (in shares)	90,956,613	90,282,267
Common stock, shares outstanding (in shares)	90,956,613	90,282,267
Series A Convertible Preferred Shares
Stockholders' equity:
Preferred stock, shares authorized (in shares)	300,000	300,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Series B Convertible Preferred Shares
Stockholders' equity:
Preferred stock, shares authorized (in shares)	300,000	300,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0

Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Consolidated Statements of Operations [Abstract]
Revenue	$ 0	$ 0	$ 0	$ 0
Operating expenses:
Research and development	46,345	51,383	91,572	97,754
General and administrative	27,367	17,374	49,515	33,197
Total operating expenses	73,712	68,757	141,087	130,951
Loss from operations	(73,712)	(68,757)	(141,087)	(130,951)
Interest expense	(471)	(468)	(942)	(936)
Interest and other income, net	2,294	846	5,323	2,754
Accretion of discount on investments, net	2,243	2,678	5,006	5,097
Net loss	$ (69,646)	$ (65,701)	$ (131,700)	$ (124,036)
Net loss per share - basic (in dollars per share)	$ (0.74)	$ (0.82)	$ (1.4)	$ (1.55)
Net loss per share - diluted (in dollars per share)	$ (0.74)	$ (0.82)	$ (1.4)	$ (1.55)
Weighted-average common shares outstanding - basic (in shares)	93,746,243	80,472,362	93,759,894	79,965,755
Weighted-average common shares outstanding - diluted (in shares)	93,746,243	80,472,362	93,759,894	79,965,755

Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Consolidated Statements of Comprehensive Loss [Abstract]
Net loss	$ (69,646)	$ (65,701)	$ (131,700)	$ (124,036)
Other comprehensive loss
Net unrealized loss on investments	(83)	(639)	(537)	(367)
Total comprehensive loss	$ (69,729)	$ (66,340)	$ (132,237)	$ (124,403)

Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Total	Common Stock	Treasury Stock, Common	Additional Paid-In Capital	Accumulated Other Comprehensive Income / (Loss)	Accumulated Deficit
Beginning Balance at Dec. 31, 2022	$ 489,686	$ 791	$ (47)	$ 1,203,074	$ (357)	$ (713,775)
Beginning Balance (in shares) at Dec. 31, 2022		79,123,312
Issuance of common stock pursuant to exercise of stock options	1,114	$ 1		1,113
Issuance of common stock pursuant to exercise of stock options (in shares)		88,429
Issuance of common stock pursuant to vesting of restricted stock units		$ 1		(1)
Issuance of common stock pursuant to vesting of restricted stock units (in shares)		126,060
Issuance of common stock pursuant to exercise of warrants	7	$ 1		6
Issuance of common stock pursuant to exercise of warrant (in shares)		126,093
Issuance of common stock pursuant to the at-the-market offering program, net of issuance costs	17,222	$ 10		17,212
Issuance of common stock pursuant to the at-the-market offering program, net of issuance costs (in shares)		948,300
Unrealized comprehensive gain (loss) on investments	267				267
Stock-based compensation	8,915			8,915
Net loss	(58,335)					(58,335)
Ending Balance at Mar. 31, 2023	458,876	$ 804	(47)	1,230,319	(90)	(772,110)
Ending Balance (in shares) at Mar. 31, 2023		80,412,194
Beginning Balance at Dec. 31, 2022	489,686	$ 791	(47)	1,203,074	(357)	(713,775)
Beginning Balance (in shares) at Dec. 31, 2022		79,123,312
Net loss	(124,036)
Ending Balance at Jun. 30, 2023	402,970	$ 805	(47)	1,240,745	(722)	(837,811)
Ending Balance (in shares) at Jun. 30, 2023		80,521,415
Beginning Balance at Mar. 31, 2023	458,876	$ 804	(47)	1,230,319	(90)	(772,110)
Beginning Balance (in shares) at Mar. 31, 2023		80,412,194
Issuance of common stock pursuant to exercise of stock options	182			182
Issuance of common stock pursuant to exercise of stock options (in shares)		48,088
Issuance of common stock pursuant to vesting of restricted stock units		$ 1		(1)
Issuance of common stock pursuant to vesting of restricted stock units (in shares)		61,133
Unrealized comprehensive gain (loss) on investments	(632)				(632)
Stock-based compensation	10,245			10,245
Net loss	(65,701)					(65,701)
Ending Balance at Jun. 30, 2023	402,970	$ 805	$ (47)	1,240,745	(722)	(837,811)
Ending Balance (in shares) at Jun. 30, 2023		80,521,415
Beginning Balance at Dec. 31, 2023	492,574	$ 903		1,450,722	319	(959,370)
Beginning Balance (in shares) at Dec. 31, 2023		90,282,267
Issuance of common stock pursuant to exercise of stock options	1,184			1,184
Issuance of common stock pursuant to exercise of stock options (in shares)		73,745
Issuance of common stock pursuant to vesting of restricted stock units		$ 3		(3)
Issuance of common stock pursuant to vesting of restricted stock units (in shares)		290,578
Unrealized comprehensive gain (loss) on investments	(454)				(454)
Stock-based compensation	10,252			10,252
Net loss	(62,054)					(62,054)
Ending Balance at Mar. 31, 2024	441,502	$ 906		1,462,155	(135)	(1,021,424)
Ending Balance (in shares) at Mar. 31, 2024		90,646,590
Beginning Balance at Dec. 31, 2023	492,574	$ 903		1,450,722	319	(959,370)
Beginning Balance (in shares) at Dec. 31, 2023		90,282,267
Net loss	(131,700)
Ending Balance at Jun. 30, 2024	384,635	$ 910		1,475,013	(218)	(1,091,070)
Ending Balance (in shares) at Jun. 30, 2024		90,956,613
Beginning Balance at Mar. 31, 2024	441,502	$ 906		1,462,155	(135)	(1,021,424)
Beginning Balance (in shares) at Mar. 31, 2024		90,646,590
Issuance of common stock pursuant to exercise of stock options	1,530	$ 2		1,528
Issuance of common stock pursuant to exercise of stock options (in shares)		159,355
Issuance of common stock pursuant to vesting of restricted stock units		$ 2		(2)
Issuance of common stock pursuant to vesting of restricted stock units (in shares)		150,668
Unrealized comprehensive gain (loss) on investments	(83)				(83)
Stock-based compensation	11,332			11,332
Net loss	(69,646)					(69,646)
Ending Balance at Jun. 30, 2024	$ 384,635	$ 910		$ 1,475,013	$ (218)	$ (1,091,070)
Ending Balance (in shares) at Jun. 30, 2024		90,956,613

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Operating activities:
Net loss	$ (131,700)	$ (124,036)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization of property and equipment	3,548	2,327
Amortization of finance lease right of use asset	1,077	1,077
Stock-based compensation	21,584	19,160
Accretion of discount on investments, net	(4,996)	(4,831)
Changes in operating assets and liabilities:
Prepaid expenses and other assets	(729)	2,698
Accounts payable and accrued expenses	2,122	(4,477)
Operating lease liabilities and right of use assets, net	50	102
Finance lease liability	56	74
Other liabilities	(1,691)	(523)
Net cash used in operating activities	(110,679)	(108,429)
Investing activities:
Purchases of investments	(102,521)	(168,930)
Proceeds from maturities of investments	197,144	170,585
Payments made to acquire right of use asset	0	(36)
Purchases of property and equipment	(3,965)	(7,134)
Net cash provided by (used in) investing activities	90,658	(5,515)
Financing activities:
Issuance of common stock, pursuant to exercise of stock options	2,714	1,296
Issuance of common stock pursuant to the at-the-market offering program, net of issuance costs	0	17,222
Issuance of common stock, pursuant to exercise of warrants	0	7
Net cash provided by financing activities	2,714	18,525
Net change in cash, cash equivalents and restricted cash	(17,307)	(95,419)
Cash, cash equivalents and restricted cash at beginning of period	57,276	141,857
Cash, cash equivalents and restricted cash at end of period	39,969	46,438
Supplemental disclosure of non-cash financing and investing activities:
Accrued purchases of property and equipment, ending balance	1,036	1,265
Investment maturity receivables and purchase payables, ending balance	8,072	0
Operating lease liabilities	1,134	0
Unrealized loss on investments	$ (537)	$ (365)

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended				6 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Jun. 30, 2024	Mar. 31, 2024	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2024	Jun. 30, 2023
Pay vs Performance Disclosure
Net Income (Loss)	$ (69,646)	$ (62,054)	$ (65,701)	$ (58,335)	$ (131,700)	$ (124,036)

Insider Trading Arrangements	6 Months Ended
Insider Trading Arrangements	Jun. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Nature of Business

6 Months Ended

Jun. 30, 2024

Nature of Business [Abstract]

Nature of Business

•

Fanconi Anemia, a genetic defect in the bone marrow that reduces production of blood cells or promotes the production of faulty blood cells (RP-L102);

•

Leukocyte Adhesion Deficiency-I, a genetic disorder that causes the immune system to malfunction (RP-L201); and

•

Pyruvate Kinase Deficiency, a red blood cell autosomal recessive disorder that results in chronic non-spherocytic hemolytic anemia (RP-L301).

The Company also has two clinical stage and one pre-clinical stage in vivo adeno-associated virus programs, which include programs for:

•

Danon Disease, a multi-organ lysosomal-associated disorder leading to early death due to heart failure. The DD program is currently in an ongoing Phase 2 pivotal study.

•

The Company has global commercialization and development rights to all of these product candidates under royalty-bearing license agreements.

Risks and Liquidity

6 Months Ended

Jun. 30, 2024

Risks and Liquidity [Abstract]

Risks and Liquidity

Basis of Presentation, Principles of Consolidation and Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2024

Basis of Presentation, Principles of Consolidation and Summary of Significant Accounting Policies [Abstract]

Basis of Presentation, Principles of Consolidation and Summary of Significant Accounting Policies

Basis of Presentation

Significant Accounting Policies

Principles of Consolidation

Use of Estimates

Cash, Cash Equivalents and Restricted Cash


	June 30, 2024		December 31, 2023
Cash and cash equivalents	$	38,607	$	55,904
Restricted cash		1,362		1,372
Total cash, cash equivalents and restricted cash	$	39,969	$	57,276

Concentrations of credit risk and off-balance sheet risk

Investments

Intangible Assets

Fair Value Measurements

•

Level 1 - Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.

•

Level 2 - Valuations based on quoted prices for similar assets or liabilities in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

•

Level 3 - Valuations that require inputs that reflect the Company’s own assumptions that are both significant to the fair value measurement and unobservable.

Warrants

Stock-Based Compensation

The Company issues stock-based awards to employees and non-employees, generally in the form of stock options, RSUs and PSUs.

Recent Accounting Pronouncements

Accounting Pronouncements Not Adopted as of June 30, 2024

Fair Value of Financial Instruments

6 Months Ended

Jun. 30, 2024

Fair Value of Financial Instruments [Abstract]

Fair Value of Financial Instruments


	Fair Value Measurements as of June 30, 2024 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market mutual funds	$	21,569	$	-	$	-	$	21,569
		21,569		-		-		21,569

Investments:
U.S. Treasury securities		-		227,801		-		227,801
Corporate bonds		-		12,417		-		12,417
		-		240,218		-		240,218

Total assets	$	21,569	$	240,218	$	-	$	261,787

Liabilities:
Warrant liability	$	-	$	-	$	105	$	105
Total liabilities	$	-	$	-	$	105	$	105

	Fair Value Measurements as of December 31, 2023 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market mutual funds	$	50,737	$	-	$	-	$	50,737
U.S. Treasury securities		-		2,487		-		2,487
		50,737		2,487		-		53,224

Investments:
U.S. Treasury securities		-		312,696		-		312,696
Corporate bonds		-		38,895		-		38,895
		-		351,591		-		351,591

Total assets	$	50,737	$	354,078	$	-	$	404,815

Liabilities:
Warrant liability	$	-	$	-	$	1,876	$	1,876
Total liabilities	$	-	$	-	$	1,876	$	1,876


	Warrant Liability
Balance, December 31, 2023	$	1,876
Fair value adjustments		(1,771	)
Balance, June 30, 2024	$	105

The fair value of the warrant liability has been estimated with the following assumptions:


	June 30, 2024			December 31, 2023
Stock price	$	21.53		$	29.50
Exercise price	$	65.23		$	65.23
Expected volatility		59.62	%		68.83	%
Risk-free interest rate		4.85	%		4.70	%
Expected dividend yield		-			-
Expected life (years)		0.81			1.31
Fair value per warrant	$	0.17		$	3.04

Property and Equipment, Net

6 Months Ended

Jun. 30, 2024

Property and Equipment, Net [Abstract]

Property and Equipment, Net

The Company’s property and equipment consisted of the following:


	June 30, 2024			December 31, 2023
Laboratory equipment	$	32,352		$	29,232
Machinery and equipment		12,572			12,325
Computer equipment		417			244
Furniture and fixtures		2,777			2,777
Leasehold improvements		7,107			6,723
Internal use software		1,903			1,903
		57,128			53,204
Less: accumulated depreciation and amortization		(17,580	)		(14,032	)
Total property and equipment, net	$	39,548		$	39,172

Intangible Assets and Goodwill

6 Months Ended

Jun. 30, 2024

Intangible Assets and Goodwill [Abstract]

Intangible Assets and Goodwill


	June 30, 2024		December 31, 2023
Gross carrying value	$	25,150	$	25,150
Accumulated amortization		-		-
Total intangible assets	$	25,150	$	25,150

The carrying value of Goodwill as of June 30, 2024 and December 31, 2023 was $39.2 million.

Accounts Payable and Accrued Expenses

6 Months Ended

Jun. 30, 2024

Accounts Payable and Accrued Expenses [Abstract]

Accounts Payable and Accrued Expenses

The Company’s accounts payable and accrued expenses consisted of the following:


	June 30, 2024		December 31, 2023
Research and development	$	17,356	$	13,867
Investment payable		-		13,137
Employee compensation		7,291		9,930
Property and equipment		1,036		1,077
Professional fees		5,989		6,006
Other		3,061		1,772
Total accounts payable and accrued expenses	$	34,733	$	45,789

The $13.1 million investment payable at December 31, 2023 was related to investment purchases of available-for-sale securities in 2023 that settled in 2024.

Stockholders' Equity

6 Months Ended

Jun. 30, 2024

Stockholders' Equity [Abstract]

Stockholders' Equity

Stockholders’ Equity

At-the-Market Offering Program

Stock-Based Compensation

6 Months Ended

Jun. 30, 2024

Stock-Based Compensation [Abstract]

Stock-Based Compensation

Stock Option Valuation

The weighted average assumptions that the Company used in a Black-Scholes pricing model to determine the fair value of stock options granted to employees, non-employees and directors were as follows:


	Six Months Ended June 30,
	2024			2023
Risk-free interest rate		4.94	%		3.96	%
Expected term (in years)		5.82			5.84
Expected volatility		73.69	%		73.42	%
Expected dividend yield		0.00	%		0.00	%
Exercise price	$	27.90		$	20.20
Fair value of common stock	$	27.90		$	20.20

The following table summarizes stock option activity for the six months ended June 30, 2024:


				Weighted		Weighted
				Average		Average		Aggregate
	Number of			Exercise		Contractual		Intrinsic
	Shares			Price		Term (Years)		Value
Outstanding as of December 31, 2023		14,863,996		$	15.07		5.16	$	250,602
Granted		1,595,074			27.90		9.63
Exercised		(233,100	)		11.64				3,249
Cancelled or forfeited		(119,813	)		24.83
Outstanding as of June 30, 2024		16,106,157		$	16.31		5.15	$	136,365

Options vested and exercisable as of June 30, 2024		12,735,361		$	14.46		4.12	$	131,840
Options unvested as of June 30, 2024		3,370,796		$	23.34		9.03	$	4,525

The weighted average grant-date fair value per share of stock options granted during the six months ended June 30, 2024, and 2023 was $18.80 and $13.46, respectively.

The total fair value of options vested during six months ended June 30, 2024 and 2023 was $19.3 million and $19.9 million, respectively.

Restricted Stock Units

The following table summarizes the Company’s RSU activity for the six months ended June 30, 2024:


				Weighted Average
	Number of			Grant Date
	Shares			Fair Value
Unvested as of December 31, 2023		1,490,357		$	18.53
Granted		694,940			28.34
Vested		(441,246	)		18.99
Forfeited		(59,898	)		18.95
Unvested as of June 30, 2024		1,684,153		$	22.44

Performance Stock Units

The following table summarizes the Company’s PSU activity for six months ended June 30, 2024:


			Weighted Average
	Number of		Grant Date
	Shares		Fair Value
Unvested as of December 31, 2023		-	$	-
Granted		156,738		27.93
Vested		-		-
Forfeited		-		-
Unvested as of June 30, 2024		156,738	$	27.93

Stock-Based Compensation Expense

Stock-based compensation expense recognized by award type was as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Stock options	$	7,162	$	7,455	$	14,100	$	14,440
Restricted stock units		4,170		2,790		7,484		4,720
Total stock-based compensation expense	$	11,332	$	10,245	$	21,584	$	19,160

Stock-based compensation expense by classification included within the Consolidated Statements of Operations and Comprehensive Loss was as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Research and development	$	4,885	$	4,638	$	9,522	$	8,457
General and administrative		6,447		5,607		12,062		10,703
Total stock-based compensation expense	$	11,332	$	10,245	$	21,584	$	19,160

Warrants

6 Months Ended

Jun. 30, 2024

Warrants [Abstract]

Warrants

10.

Warrants

A summary of the warrants outstanding as of June 30, 2024 is as follows:


Exercise Price	Outstanding	Grant/Assumption Date	Expiration Date
$57.11	603,386	December 21, 2020	December 21, 2030
33.63	301,291	August 9, 2021	August 9, 2031
22.51	153,155	December 17, 2021	December 17, 2031
22.51	153,155	December 17, 2021	December 17, 2031
65.23	617,050	December 1, 2022	April 23, 2025
65.23	760,086	December 1, 2022	December 1, 2026
$0.01	3,126,955	September 15, 2023	N/A
Total	5,715,078

There were no changes in warrants to purchase common stock for the six months ended June 30, 2024.

Warrants Issued in Public Offering

Assumed Renovacor Public Warrants

Assumed Renovacor Private Warrants

Net Loss Per Share

6 Months Ended

Jun. 30, 2024

Net Loss Per Share [Abstract]

Net Loss Per Share

11.

Net Loss Per Share

Basic and diluted net loss per share attributable to common stockholders was calculated as follows:


	Three Months Ended June 30,						Six Months Ended June 30,
	2024			2023			2024			2023
Numerator:
Net loss attributable to common stockholders	$	(69,646	)	$	(65,701	)	$	(131,700	)	$	(124,036	)
Denominator:
Weighted-average common shares outstanding - basic and diluted		93,746,243			80,472,362			93,759,894			79,965,755
Net loss per share attributable to common stockholders - basic and diluted	$	(0.74	)	$	(0.82	)	$	(1.40	)	$	(1.55	)


	Three and Six Months Ended June 30,
	2024		2023
Warrants exercisable for common shares		2,588,123		2,588,123
Restricted stock units		1,684,153		1,654,759
Performance stock units		156,738		-
Options to purchase common shares		16,106,157		14,875,150
Total potential shares excluded from diluted net loss per share		20,535,171		19,118,032

Leases

6 Months Ended

Jun. 30, 2024

Leases [Abstract]

Leases

12.

Leases

Finance Lease

Operating Leases

The total restricted cash balance for the Company’s operating and finance leases as of June 30, 2024 and December 31, 2023 was $0.8 million.

The following table summarizes lease cost for the six months ended June 30, 2024 and 2023:


	Six Months Ended June 30,
Lease cost	2024		2023
Operating lease cost	$	672	$	742
Finance lease cost:
Amortization of right of use assets		1,077		1,077
Interest on lease liabilities		942		936
Total lease cost	$	2,691	$	2,755

The following table summarizes the future lease payments of the Company’s operating lease liabilities on an undiscounted cash flow basis:


Fiscal Year Ending December 31,	June 30, 2024
2024 (six months)	$	533
2025		1,001
2026		1,005
2027		759
2028		522
Thereafter		2,420
Total lease payments	$	6,240
Less: interest		(1,642	)
Total operating lease liabilities	$	4,598

The following table summarizes the future lease payments of the Company’s finance lease liability on an undiscounted cash flow basis:


Fiscal Year Ending December 31,	June 30, 2024
2024 (six months)	$	905
2025		1,856
2026		1,911
2027		1,969
2028		2,028
Thereafter		41,003
Total lease payments	$	49,672
Less: interest		(28,472	)
Total finance lease liability	$	21,200

The following table summarizes the operating and financing lease liabilities and right-of-use assets as of June 30, 2024 and December 31, 2023:


Leases	June 30, 2024		December 31, 2023
Operating right-of-use assets	$	4,551	$	3,901

Operating current lease liabilities	$	1,033	$	925
Operating noncurrent lease liabilities		3,565		2,973
Total operating lease liabilities	$	4,598	$	3,898

Finance right-of-use assets	$	43,440	$	44,517

Finance current lease liability	$	1,826	$	1,791
Finance noncurrent lease liability		19,374		19,353
Total finance lease liability	$	21,200	$	21,144


	Six Months Ended June 30,
Other Information	2024			2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	584		$	582
Cash flows from finance lease	$	886		$	862
Weighted-average remaining lease term - operating leases		6.9 years			7.9 years
Weighted-average remaining lease term - finance lease		20.2 years			21.2 years
Weighted-average discount rate - operating leases		8.82	%		8.25	%
Weighted-average discount rate - finance lease		8.96	%		8.96	%

Commitments and Contingencies

6 Months Ended

Jun. 30, 2024

Commitments and Contingencies [Abstract]

Commitments and Contingencies

13.

Commitments and Contingencies

Litigation

Indemnification Arrangements

Agreements Related to Intellectual Property	6 Months Ended
Agreements Related to Intellectual Property	Jun. 30, 2024
Agreements Related to Intellectual Property [Abstract]
Agreements Related to Intellectual Property	14. Agreements Related to Intellectual Property The Company, directly and through its subsidiary Spacecraft Seven, LLC, has various license and research and collaboration arrangements. The transactions principally resulted in the acquisition of rights to intellectual property which is in the preclinical phase and has not been tested for safety or feasibility. In all cases, the Company did not acquire tangible assets, processes, protocols, or operating systems. The Company expenses the acquired intellectual property rights as of the acquisition date on the basis that the cost of intangible assets purchased from others for use in R&D activities has no alternative future uses.

CIRM Grants

6 Months Ended

Jun. 30, 2024

CIRM Grants [Abstract]

CIRM Grants

15.

CIRM Grants

LAD-I CIRM Grant

Related Party Transactions

6 Months Ended

Jun. 30, 2024

Related Party Transactions

16.

Related Party Transactions

401(k) Savings Plan	6 Months Ended
401(k) Savings Plan	Jun. 30, 2024
401(k) Savings Plan [Abstract]
401(k) Savings Plan	17. 401(k) Savings Plan The Company has a defined contribution savings plan (the “Plan”) under Section 401(k) of the Internal Revenue Code of 1986. This Plan covers substantially all employees who meet minimum age and service requirements and allows participants to defer a portion of their annual compensation on a pre-tax basis. Company contributions to the Plan may be made at the discretion of the Company’s Board of Directors. The Company has elected the safe harbor match of 4% of employee contributions to the Plan, subject to certain limitations. The Company’s matching contribution for the three and six months ended June 30, 2024, was $0.4 and $0.8 million, respectively. The Company’s matching contribution for the three and six months ended June 30, 2023, was $0.3 and $0.6 million, respectively.

Basis of Presentation, Principles of Consolidation and Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2024

Basis of Presentation, Principles of Consolidation and Summary of Significant Accounting Policies [Abstract]

Basis of Presentation

Significant Accounting Policies

Principles of Consolidation

Use of Estimates

Cash, Cash Equivalents and Restricted Cash


	June 30, 2024		December 31, 2023
Cash and cash equivalents	$	38,607	$	55,904
Restricted cash		1,362		1,372
Total cash, cash equivalents and restricted cash	$	39,969	$	57,276

Concentrations of Credit Risk and Off-balance Sheet Risk

Concentrations of credit risk and off-balance sheet risk

Investments

Intangible Assets

Fair Value Measurements

•

Level 1 - Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.

•

Level 2 - Valuations based on quoted prices for similar assets or liabilities in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

•

Level 3 - Valuations that require inputs that reflect the Company’s own assumptions that are both significant to the fair value measurement and unobservable.

Warrants

Stock-Based Compensation

The Company issues stock-based awards to employees and non-employees, generally in the form of stock options, RSUs and PSUs.

Recent Accounting Pronouncements

Accounting Pronouncements Not Adopted as of June 30, 2024

Basis of Presentation, Principles of Consolidation and Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2024

Basis of Presentation, Principles of Consolidation and Summary of Significant Accounting Policies [Abstract]

Cash, Cash Equivalents and Restricted Cash


	June 30, 2024		December 31, 2023
Cash and cash equivalents	$	38,607	$	55,904
Restricted cash		1,362		1,372
Total cash, cash equivalents and restricted cash	$	39,969	$	57,276

Fair Value of Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2024

Fair Value of Financial Instruments [Abstract]

Measured on Recurring Basis


	Fair Value Measurements as of June 30, 2024 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market mutual funds	$	21,569	$	-	$	-	$	21,569
		21,569		-		-		21,569

Investments:
U.S. Treasury securities		-		227,801		-		227,801
Corporate bonds		-		12,417		-		12,417
		-		240,218		-		240,218

Total assets	$	21,569	$	240,218	$	-	$	261,787

Liabilities:
Warrant liability	$	-	$	-	$	105	$	105
Total liabilities	$	-	$	-	$	105	$	105

	Fair Value Measurements as of December 31, 2023 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market mutual funds	$	50,737	$	-	$	-	$	50,737
U.S. Treasury securities		-		2,487		-		2,487
		50,737		2,487		-		53,224

Investments:
U.S. Treasury securities		-		312,696		-		312,696
Corporate bonds		-		38,895		-		38,895
		-		351,591		-		351,591

Total assets	$	50,737	$	354,078	$	-	$	404,815

Liabilities:
Warrant liability	$	-	$	-	$	1,876	$	1,876
Total liabilities	$	-	$	-	$	1,876	$	1,876

Changes in Level 3 Liabilities Measured at Fair Value


	Warrant Liability
Balance, December 31, 2023	$	1,876
Fair value adjustments		(1,771	)
Balance, June 30, 2024	$	105

Level 3 Fair Value of the Private Warrants

The fair value of the warrant liability has been estimated with the following assumptions:


	June 30, 2024			December 31, 2023
Stock price	$	21.53		$	29.50
Exercise price	$	65.23		$	65.23
Expected volatility		59.62	%		68.83	%
Risk-free interest rate		4.85	%		4.70	%
Expected dividend yield		-			-
Expected life (years)		0.81			1.31
Fair value per warrant	$	0.17		$	3.04

Property and Equipment, Net (Tables)

6 Months Ended

Jun. 30, 2024

Property and Equipment, Net [Abstract]

Summary of Property and Equipment

The Company’s property and equipment consisted of the following:


	June 30, 2024			December 31, 2023
Laboratory equipment	$	32,352		$	29,232
Machinery and equipment		12,572			12,325
Computer equipment		417			244
Furniture and fixtures		2,777			2,777
Leasehold improvements		7,107			6,723
Internal use software		1,903			1,903
		57,128			53,204
Less: accumulated depreciation and amortization		(17,580	)		(14,032	)
Total property and equipment, net	$	39,548		$	39,172

Intangible Assets and Goodwill (Tables)

6 Months Ended

Jun. 30, 2024

Intangible Assets and Goodwill [Abstract]

Summary of Intangible Assets

Intangible assets as of June 30, 2024 and December 31, 2023 are summarized as follows:


	June 30, 2024		December 31, 2023
Gross carrying value	$	25,150	$	25,150
Accumulated amortization		-		-
Total intangible assets	$	25,150	$	25,150

Accounts Payable and Accrued Expenses (Tables)

6 Months Ended

Jun. 30, 2024

Accounts Payable and Accrued Expenses [Abstract]

Schedule of Accounts Payable and Accrued Expenses

The Company’s accounts payable and accrued expenses consisted of the following:


	June 30, 2024		December 31, 2023
Research and development	$	17,356	$	13,867
Investment payable		-		13,137
Employee compensation		7,291		9,930
Property and equipment		1,036		1,077
Professional fees		5,989		6,006
Other		3,061		1,772
Total accounts payable and accrued expenses	$	34,733	$	45,789

Stock-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2024

Stock-Based Compensation [Abstract]

Weighted-Average Assumptions for Stock Options

The weighted average assumptions that the Company used in a Black-Scholes pricing model to determine the fair value of stock options granted to employees, non-employees and directors were as follows:


	Six Months Ended June 30,
	2024			2023
Risk-free interest rate		4.94	%		3.96	%
Expected term (in years)		5.82			5.84
Expected volatility		73.69	%		73.42	%
Expected dividend yield		0.00	%		0.00	%
Exercise price	$	27.90		$	20.20
Fair value of common stock	$	27.90		$	20.20

Stock Option Activity

The following table summarizes stock option activity for the six months ended June 30, 2024:


				Weighted		Weighted
				Average		Average		Aggregate
	Number of			Exercise		Contractual		Intrinsic
	Shares			Price		Term (Years)		Value
Outstanding as of December 31, 2023		14,863,996		$	15.07		5.16	$	250,602
Granted		1,595,074			27.90		9.63
Exercised		(233,100	)		11.64				3,249
Cancelled or forfeited		(119,813	)		24.83
Outstanding as of June 30, 2024		16,106,157		$	16.31		5.15	$	136,365

Options vested and exercisable as of June 30, 2024		12,735,361		$	14.46		4.12	$	131,840
Options unvested as of June 30, 2024		3,370,796		$	23.34		9.03	$	4,525

RSU Activity

The following table summarizes the Company’s RSU activity for the six months ended June 30, 2024:


				Weighted Average
	Number of			Grant Date
	Shares			Fair Value
Unvested as of December 31, 2023		1,490,357		$	18.53
Granted		694,940			28.34
Vested		(441,246	)		18.99
Forfeited		(59,898	)		18.95
Unvested as of June 30, 2024		1,684,153		$	22.44

PSU Activity

The following table summarizes the Company’s PSU activity for six months ended June 30, 2024:


			Weighted Average
	Number of		Grant Date
	Shares		Fair Value
Unvested as of December 31, 2023		-	$	-
Granted		156,738		27.93
Vested		-		-
Forfeited		-		-
Unvested as of June 30, 2024		156,738	$	27.93

Stock-Based Compensation Expense by Award Type

Stock-based compensation expense recognized by award type was as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Stock options	$	7,162	$	7,455	$	14,100	$	14,440
Restricted stock units		4,170		2,790		7,484		4,720
Total stock-based compensation expense	$	11,332	$	10,245	$	21,584	$	19,160

Stock-Based Compensation Expense

Stock-based compensation expense by classification included within the Consolidated Statements of Operations and Comprehensive Loss was as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Research and development	$	4,885	$	4,638	$	9,522	$	8,457
General and administrative		6,447		5,607		12,062		10,703
Total stock-based compensation expense	$	11,332	$	10,245	$	21,584	$	19,160

Warrants (Tables)

6 Months Ended

Jun. 30, 2024

Warrants [Abstract]

Warrants Outstanding and Changes in Warrants to Purchase Common Stock

A summary of the warrants outstanding as of June 30, 2024 is as follows:


Exercise Price	Outstanding	Grant/Assumption Date	Expiration Date
$57.11	603,386	December 21, 2020	December 21, 2030
33.63	301,291	August 9, 2021	August 9, 2031
22.51	153,155	December 17, 2021	December 17, 2031
22.51	153,155	December 17, 2021	December 17, 2031
65.23	617,050	December 1, 2022	April 23, 2025
65.23	760,086	December 1, 2022	December 1, 2026
$0.01	3,126,955	September 15, 2023	N/A
Total	5,715,078

There were no changes in warrants to purchase common stock for the six months ended June 30, 2024.

Net Loss Per Share (Tables)

6 Months Ended

Jun. 30, 2024

Net Loss Per Share [Abstract]

Basic and Diluted Net Loss Per Share

Basic and diluted net loss per share attributable to common stockholders was calculated as follows:


	Three Months Ended June 30,						Six Months Ended June 30,
	2024			2023			2024			2023
Numerator:
Net loss attributable to common stockholders	$	(69,646	)	$	(65,701	)	$	(131,700	)	$	(124,036	)
Denominator:
Weighted-average common shares outstanding - basic and diluted		93,746,243			80,472,362			93,759,894			79,965,755
Net loss per share attributable to common stockholders - basic and diluted	$	(0.74	)	$	(0.82	)	$	(1.40	)	$	(1.55	)

Antidilutive Securities Excluded from Computation of Diluted Net Loss Per Share


	Three and Six Months Ended June 30,
	2024		2023
Warrants exercisable for common shares		2,588,123		2,588,123
Restricted stock units		1,684,153		1,654,759
Performance stock units		156,738		-
Options to purchase common shares		16,106,157		14,875,150
Total potential shares excluded from diluted net loss per share		20,535,171		19,118,032

Leases (Tables)

6 Months Ended

Jun. 30, 2024

Leases [Abstract]

Lease Cost

The following table summarizes lease cost for the six months ended June 30, 2024 and 2023:


	Six Months Ended June 30,
Lease cost	2024		2023
Operating lease cost	$	672	$	742
Finance lease cost:
Amortization of right of use assets		1,077		1,077
Interest on lease liabilities		942		936
Total lease cost	$	2,691	$	2,755

Future Lease Payments of Operating Lease Liabilities

The following table summarizes the future lease payments of the Company’s operating lease liabilities on an undiscounted cash flow basis:


Fiscal Year Ending December 31,	June 30, 2024
2024 (six months)	$	533
2025		1,001
2026		1,005
2027		759
2028		522
Thereafter		2,420
Total lease payments	$	6,240
Less: interest		(1,642	)
Total operating lease liabilities	$	4,598

Future Lease Payments of Finance Lease Liability

The following table summarizes the future lease payments of the Company’s finance lease liability on an undiscounted cash flow basis:


Fiscal Year Ending December 31,	June 30, 2024
2024 (six months)	$	905
2025		1,856
2026		1,911
2027		1,969
2028		2,028
Thereafter		41,003
Total lease payments	$	49,672
Less: interest		(28,472	)
Total finance lease liability	$	21,200

Balance Sheet Information Related to Leases

The following table summarizes the operating and financing lease liabilities and right-of-use assets as of June 30, 2024 and December 31, 2023:


Leases	June 30, 2024		December 31, 2023
Operating right-of-use assets	$	4,551	$	3,901

Operating current lease liabilities	$	1,033	$	925
Operating noncurrent lease liabilities		3,565		2,973
Total operating lease liabilities	$	4,598	$	3,898

Finance right-of-use assets	$	43,440	$	44,517

Finance current lease liability	$	1,826	$	1,791
Finance noncurrent lease liability		19,374		19,353
Total finance lease liability	$	21,200	$	21,144


	Six Months Ended June 30,
Other Information	2024			2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	584		$	582
Cash flows from finance lease	$	886		$	862
Weighted-average remaining lease term - operating leases		6.9 years			7.9 years
Weighted-average remaining lease term - finance lease		20.2 years			21.2 years
Weighted-average discount rate - operating leases		8.82	%		8.25	%
Weighted-average discount rate - finance lease		8.96	%		8.96	%

Nature of Business - Additional Information (Details)	6 Months Ended
Nature of Business - Additional Information (Details)	Jun. 30, 2024 Program
LV Member
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Number of clinical-stage programs	3
AAV Member
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Number of clinical-stage programs	2
Number of pre clinical-stage programs	1

Risks and Liquidity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023	Sep. 12, 2023	Feb. 28, 2022
Class of Stock [Line Items]
Accumulated deficit	$ (1,091,070)		$ (959,370)
Cash, cash equivalents and investments	278,800
Cash	$ 286,900
Shareholders' Equity Disclosure [Abstract]
Common stock, par value (in dollars per share)	$ 0.01		$ 0.01
Net proceeds from offering	$ 0	$ 17,222
Investments in Securities
Class of Stock [Line Items]
Cash, cash equivalents and investments	$ 8,100
At-the-Market Offering Program
Shareholders' Equity Disclosure [Abstract]
Common stock shares issued and sold (in shares)	0
At-the-Market Offering Program \| Cowen and Company, LLC
Shareholders' Equity Disclosure [Abstract]
Common stock, par value (in dollars per share)					$ 0.01
Common stock shares issued and sold (in shares)	4,200,000
Net proceeds from offering	$ 63,800
At-the-Market Offering Program \| Cowen and Company, LLC \| Common Stock
Shareholders' Equity Disclosure [Abstract]
Net proceeds from offering	$ 63,800
At-the-Market Offering Program \| Cowen and Company, LLC \| Maximum
Shareholders' Equity Disclosure [Abstract]
Aggregate offering price				$ 180,000	$ 200,000

Basis of Presentation, Principles of Consolidation and Summary of Significant Accounting Policies - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023	Jun. 30, 2023	Dec. 31, 2022
Cash, Cash Equivalents and Restricted Cash [Abstract]
Cash and cash equivalents	$ 38,607	$ 55,904
Restricted cash	1,362	1,372
Total cash, cash equivalents and restricted cash	$ 39,969	$ 57,276	$ 46,438	$ 141,857

Basis of Presentation, Principles of Consolidation and Summary of Significant Accounting Policies - Investments - Additional Information (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Investments [Abstract]
Net unrealized loss on credit investments	$ 0	$ 0	$ 0	$ 0
Net unrealized gains (losses) on investments	$ (100,000)	$ (600,000)	$ (537,000)	$ (365,000)

Fair Value of Financial Instruments - Measured on Recurring Basis (Details) - Recurring - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Assets [Abstract]
Cash equivalents	$ 21,569	$ 53,224
Investments	240,218	351,591
Fair value of financial instruments	261,787	404,815
Liabilities [Abstract]
Total liabilities	105	1,876
Warrant Liability
Liabilities [Abstract]
Total liabilities	105	1,876
Money Market Mutual Funds
Assets [Abstract]
Cash equivalents	21,569	50,737
U.S. Treasury securities
Assets [Abstract]
Cash equivalents		2,487
Investments	227,801	312,696
Corporate bonds
Assets [Abstract]
Investments	12,417	38,895
Level 1
Assets [Abstract]
Cash equivalents	21,569	50,737
Investments	0	0
Fair value of financial instruments	21,569	50,737
Liabilities [Abstract]
Total liabilities	0	0
Level 1 \| Warrant Liability
Liabilities [Abstract]
Total liabilities	0	0
Level 1 \| Money Market Mutual Funds
Assets [Abstract]
Cash equivalents	21,569	50,737
Level 1 \| U.S. Treasury securities
Assets [Abstract]
Cash equivalents		0
Investments	0	0
Level 1 \| Corporate bonds
Assets [Abstract]
Investments	0	0
Level 2
Assets [Abstract]
Cash equivalents	0	2,487
Investments	240,218	351,591
Fair value of financial instruments	240,218	354,078
Liabilities [Abstract]
Total liabilities	0	0
Level 2 \| Warrant Liability
Liabilities [Abstract]
Total liabilities	0	0
Level 2 \| Money Market Mutual Funds
Assets [Abstract]
Cash equivalents	0	0
Level 2 \| U.S. Treasury securities
Assets [Abstract]
Cash equivalents		2,487
Investments	227,801	312,696
Level 2 \| Corporate bonds
Assets [Abstract]
Investments	12,417	38,895
Level 3
Assets [Abstract]
Cash equivalents	0	0
Investments	0	0
Fair value of financial instruments	0	0
Liabilities [Abstract]
Total liabilities	105	1,876
Level 3 \| Warrant Liability
Liabilities [Abstract]
Total liabilities	105	1,876
Level 3 \| Money Market Mutual Funds
Assets [Abstract]
Cash equivalents	0	0
Level 3 \| U.S. Treasury securities
Assets [Abstract]
Cash equivalents		0
Investments	0	0
Level 3 \| Corporate bonds
Assets [Abstract]
Investments	$ 0	$ 0

Fair Value of Financial Instruments - Changes in Level 3 Liabilities Measured at Fair Value (Details) - Recurring - Level 3 - Warrant Liability $ in Thousands	6 Months Ended
	Jun. 30, 2024 USD ($)
Changes in Fair Value of Warrant Liabilities [Roll Forward]
Fair value, beginning of period	$ 1,876
Fair value adjustments	(1,771)
Fair value, end of period	$ 105

Fair Value of Financial Instruments - Level 3 Fair Value of the Private Warrants (Details) - Private Warrants	Jun. 30, 2024 USD ($) $ / shares	Dec. 31, 2023 USD ($) $ / shares
Fair Value of the Private Warrants, Assumptions [Abstract]
Term	9 months 21 days	1 year 3 months 21 days
Fair value per warrant (in dollars per share) \| $ / shares	$ 0.17	$ 3.04
Stock Price
Fair Value of the Private Warrants, Assumptions [Abstract]
Measurement input	21.53	29.5
Exercise Price
Fair Value of the Private Warrants, Assumptions [Abstract]
Measurement input	65.23	65.23
Expected Volatility
Fair Value of the Private Warrants, Assumptions [Abstract]
Measurement input	59.62	68.83
Risk-Free Interest Rate
Fair Value of the Private Warrants, Assumptions [Abstract]
Measurement input	4.85	4.7
Expected Dividend Yield
Fair Value of the Private Warrants, Assumptions [Abstract]
Measurement input	0	0

Property and Equipment, Net - Summary of Property and Equipment (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Property and Equipment [Abstract]
Property and equipment, gross	$ 57,128	$ 53,204
Less: accumulated depreciation and amortization	(17,580)	(14,032)
Total property and equipment, net	39,548	39,172
Laboratory Equipment
Property and Equipment [Abstract]
Property and equipment, gross	32,352	29,232
Machinery and Equipment
Property and Equipment [Abstract]
Property and equipment, gross	12,572	12,325
Computer Equipment
Property and Equipment [Abstract]
Property and equipment, gross	417	244
Furniture and Fixtures
Property and Equipment [Abstract]
Property and equipment, gross	2,777	2,777
Leasehold Improvements
Property and Equipment [Abstract]
Property and equipment, gross	7,107	6,723
Internal use Software
Property and Equipment [Abstract]
Property and equipment, gross	$ 1,903	$ 1,903

Property and Equipment, Net - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Property and Equipment, Net [Abstract]
Depreciation and amortization	$ 1.8	$ 1.2	$ 3.5	$ 2.3

Intangible Assets and Goodwill - Summary of Intangible Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Intangible Assets, Net [Abstract]
Gross Carrying Value	$ 25,150	$ 25,150
Total intangible assets	$ 25,150	$ 25,150

Intangible Assets and Goodwill - Additional Information (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Indefinite-Lived Intangible Assets [Line Items]
Goodwill	$ 39,154	$ 39,154

Accounts Payable and Accrued Expenses - Schedule of Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Accounts Payable and Accrued Expenses [Abstract]
Research and development	$ 17,356	$ 13,867
Investment payable	0	13,137
Employee compensation	7,291	9,930
Property and equipment	1,036	1,077
Professional fees	5,989	6,006
Other	3,061	1,772
Total accounts payable and accrued expenses	$ 34,733	$ 45,789

Accounts Payable and Accrued Expenses - Additional Information (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Accounts Payable and Accrued Expenses [Abstract]
Investment payable	$ 0	$ 13,137

Stockholders' Equity - Additional Information (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Sep. 12, 2023	Feb. 28, 2022
At-the-Market Offering Program [Abstract]
Net proceeds from offering	$ 0	$ 17,222
At-the-Market Offering Program
At-the-Market Offering Program [Abstract]
Issuance of common stock, net of issuance costs (in shares)	0
At-the-Market Offering Program \| Cowen and Company, LLC
At-the-Market Offering Program [Abstract]
Percentage of cash commission				3.00%
Issuance of common stock, net of issuance costs (in shares)	4,200,000
Gross proceeds, offering amount	$ 65,800
Commissions	2,000
Net proceeds from offering	63,800
At-the-Market Offering Program \| Cowen and Company, LLC \| Common Stock
At-the-Market Offering Program [Abstract]
Net proceeds from offering	$ 63,800
At-the-Market Offering Program \| Cowen and Company, LLC \| Maximum
At-the-Market Offering Program [Abstract]
Aggregate offering price			$ 180,000	$ 200,000

Stock-Based Compensation - Weighted-Average Assumptions for Stock Options (Details) - Employees, Non-employees and Directors - $ / shares	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Weighted-Average Assumptions [Abstract]
Risk-free interest rate	4.94%	3.96%
Expected term	5 years 9 months 25 days	5 years 10 months 2 days
Expected volatility	73.69%	73.42%
Expected dividend yield	0.00%	0.00%
Exercise price (in dollars per share)	$ 27.9	$ 20.2
Fair value of common stock (in dollars per share)	$ 27.9	$ 20.2

Stock-Based Compensation - Stock Option Activity (Details) - Employee Stock Option $ / shares in Units, $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2024 USD ($) $ / shares shares	Dec. 31, 2023 USD ($) $ / shares shares
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding [Roll Forward]
Outstanding at beginning of period (in shares) \| shares	14,863,996
Granted (in shares) \| shares	1,595,074
Exercised (in shares) \| shares	(233,100)
Cancelled or forfeited (in shares) \| shares	(119,813)
Outstanding at end of period (in shares) \| shares	16,106,157	14,863,996
Options vested and exercisable at end of period (in shares) \| shares	12,735,361
Options unvested at ending of period (in shares) \| shares	3,370,796
Weighted Average Exercise Price [Abstract]
Outstanding at beginning of period (in dollars per share) \| $ / shares	$ 15.07
Granted (in dollars per share) \| $ / shares	27.9
Exercised (in dollars per share) \| $ / shares	11.64
Cancelled or forfeited (in dollars per share) \| $ / shares	24.83
Outstanding at end of period (in dollars per share) \| $ / shares	16.31	$ 15.07
Options vested and exercisable at end of period (in dollars per share) \| $ / shares	14.46
Options unvested at ending (in dollars per share) \| $ / shares	$ 23.34
Weighted-Average Remaining Contractual Term [Abstract]
Outstanding	5 years 1 month 24 days	5 years 1 month 28 days
Granted	9 years 7 months 17 days
Options vested and exercisable	4 years 1 month 13 days
Options unvested	9 years 10 days
Aggregate Intrinsic Value [Abstract]
Outstanding at beginning of period \| $	$ 250,602
Exercised \| $	3,249
Outstanding at end of period \| $	136,365	$ 250,602
Options vested and exercisable \| $	131,840
Options unvested \| $	$ 4,525

Stock-Based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Employee Stock Option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average grant date fair value of shares granted (in dollars per share)	$ 18.8	$ 13.46
Total fair value of options vested	$ 19.3	$ 19.9
Stock Options Performance Stock Units and Restricted Stock Units Grants
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized stock-based compensation expense	82.6
Stock Options and Restricted Stock Units Grants
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized stock-based compensation expense	$ 78.2
Weighted average period expected to recognize unrecognized share-based compensation cost	1 year 10 months 13 days

Stock-Based Compensation - RSU Activity (Details) - Restricted Stock Units	6 Months Ended
	Jun. 30, 2024 $ / shares shares
Number of Shares [Roll Forward]
Beginning balance (in shares) \| shares	1,490,357
Granted (in shares) \| shares	694,940
Vested (in shares) \| shares	(441,246)
Forfeited (in shares) \| shares	(59,898)
Ending balance (in shares) \| shares	1,684,153
Weighted Average Grant Date Fair Value [Abstract]
Beginning balance (in dollars per share) \| $ / shares	$ 18.53
Granted (in dollars per share) \| $ / shares	28.34
Vested (in dollars per share) \| $ / shares	18.99
Forfeited (in dollars per share) \| $ / shares	18.95
Ending balance (in dollars per share) \| $ / shares	$ 22.44

Stock-Based Compensation - PSU Activity (Details) - Performance Stock Units	6 Months Ended
	Jun. 30, 2024 $ / shares shares
Number of Shares [Roll Forward]
Beginning balance (in shares) \| shares	0
Granted (in shares) \| shares	156,738
Vested (in shares) \| shares	0
Forfeited (in shares) \| shares	0
Ending balance (in shares) \| shares	156,738
Weighted Average Grant Date Fair Value [Abstract]
Beginning balance (in dollars per share) \| $ / shares	$ 0
Granted (in dollars per share) \| $ / shares	27.93
Vested (in dollars per share) \| $ / shares	0
Forfeited (in dollars per share) \| $ / shares	0
Ending balance (in dollars per share) \| $ / shares	$ 27.93

Stock-Based Compensation - Stock-Based Compensation (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Stock-Based Compensation Expense [Abstract]
Total stock-based compensation expense	$ 11,332	$ 10,245	$ 21,584	$ 19,160
Research and Development
Stock-Based Compensation Expense [Abstract]
Total stock-based compensation expense	4,885	4,638	9,522	8,457
General and Administrative
Stock-Based Compensation Expense [Abstract]
Total stock-based compensation expense	6,447	5,607	12,062	10,703
Employee Stock Option
Stock-Based Compensation Expense [Abstract]
Total stock-based compensation expense	7,162	7,455	14,100	14,440
Restricted Stock Units
Stock-Based Compensation Expense [Abstract]
Total stock-based compensation expense	$ 4,170	$ 2,790	$ 7,484	$ 4,720

Warrants - Summary of Warrants Outstanding (Details)	6 Months Ended
Warrants - Summary of Warrants Outstanding (Details)	Jun. 30, 2024 $ / shares shares
Warrants [Abstract]
Outstanding (in shares)	5,715,078
57.11
Warrants [Abstract]
Exercise price per share (in dollars per share) \| $ / shares	$ 57.11
Outstanding (in shares)	603,386
Grant date	Dec. 21, 2020
Expiration date	Dec. 21, 2030
33.63
Warrants [Abstract]
Exercise price per share (in dollars per share) \| $ / shares	$ 33.63
Outstanding (in shares)	301,291
Grant date	Aug. 09, 2021
Expiration date	Aug. 09, 2031
22.51
Warrants [Abstract]
Exercise price per share (in dollars per share) \| $ / shares	$ 22.51
Outstanding (in shares)	153,155
Grant date	Dec. 17, 2021
Expiration date	Dec. 17, 2031
22.51
Warrants [Abstract]
Exercise price per share (in dollars per share) \| $ / shares	$ 22.51
Outstanding (in shares)	153,155
Grant date	Dec. 17, 2021
Expiration date	Dec. 17, 2031
65.23
Warrants [Abstract]
Exercise price per share (in dollars per share) \| $ / shares	$ 65.23
Outstanding (in shares)	617,050
Grant date	Dec. 01, 2022
Expiration date	Apr. 23, 2025
65.23
Warrants [Abstract]
Exercise price per share (in dollars per share) \| $ / shares	$ 65.23
Outstanding (in shares)	760,086
Grant date	Dec. 01, 2022
Expiration date	Dec. 01, 2026
0.01
Warrants [Abstract]
Exercise price per share (in dollars per share) \| $ / shares	$ 0.01
Outstanding (in shares)	3,126,955
Grant date	Sep. 15, 2023

Warrants - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands	Sep. 15, 2023	Jun. 30, 2024	Dec. 31, 2023
Warrants [Abstract]
Additional paid-in capital		$ 1,475,013	$ 1,450,722
Public Warrants
Warrants [Abstract]
Additional paid-in capital		$ 3,400
Public Warrants \| Common Stock
Warrants [Abstract]
Warrant to purchase shares of common stock (in shares)		760,086
Warrant to purchase shares of common stock price per share (in dollars per share)		$ 65.23
Private Warrants
Warrants [Abstract]
Warrant to purchase shares of common stock price per share (in dollars per share)		$ 0.17	$ 3.04
Private Warrants \| Common Stock
Warrants [Abstract]
Warrant to purchase shares of common stock (in shares)		617,050
Warrant to purchase shares of common stock price per share (in dollars per share)		$ 65.23
Pre-Funded Warrants \| Common Stock
Warrants [Abstract]
Number of stock warrants issued to purchase shares	3,126,955
Warrant to purchase shares of common stock price per share (in dollars per share)	$ 0.01

Net Loss Per Share - Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Numerator [Abstract]
Net loss attributable to common stockholders	$ (69,646)	$ (65,701)	$ (131,700)	$ (124,036)
Denominator [Abstract]
Weighted-average common shares outstanding - basic (in shares)	93,746,243	80,472,362	93,759,894	79,965,755
Weighted-average common shares outstanding - diluted (in shares)	93,746,243	80,472,362	93,759,894	79,965,755
Net loss per share attributable to common stockholders - basic (in dollars per share)	$ (0.74)	$ (0.82)	$ (1.4)	$ (1.55)
Net loss per share attributable to common stockholders - diluted (in dollars per share)	$ (0.74)	$ (0.82)	$ (1.4)	$ (1.55)

Net Loss Per Share - Additional Information (Details) - Pre-Funded Warrants [Member]	6 Months Ended
	Jun. 30, 2024 $ / shares shares
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares included in the calculation of EPS \| shares	3,126,955
Warrants exercise price per share \| $ / shares	$ 0.01

Net Loss Per Share - Antidilutive Securities Excluded from Computation of Diluted Net Loss Per Share (Details) - shares	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Weighted Average Number of Shares Outstanding, Diluted, Adjustment [Abstract]
Warrants exercisable for common shares	2,588,123	2,588,123
Restricted stock units	1,684,153	1,654,759
Performance stock units	156,738	0
Options to purchase common shares	16,106,157	14,875,150
Total potential shares excluded from diluted net loss per share	20,535,171	19,118,032

Leases - Finance Lease - Additional Information (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2024 USD ($) ft² Leaseagreement	Dec. 31, 2023 USD ($)
Finance Lease [Abstract]
Total lease payments	$ 49,672
Cash security deposit	$ 481	$ 533
NJ Lease Agreement [Member]
Finance Lease [Abstract]
Area of lease \| ft²	103,720
Term of finance lease agreement	15 years
Number of options to renew lease agreement \| Leaseagreement	2
Term of renewal of finance lease agreement	5 years
Estimated rent payments	$ 1,200
Percentage of annual increase in base rent	3.00%
Total lease payments	$ 29,300
Cash security deposit	$ 300
AAV Current Good Manufacturing Practice (cGMP) [Member]
Finance Lease [Abstract]
Area of lease \| ft²	50,000

Leases - Operating Leases - Additional Information (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
	Mar. 26, 2021	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023	Mar. 31, 2023	Jun. 07, 2018
Operating Leases [Abstract]
Lease expiration date				Oct. 31, 2024
Total right-of-use asset		$ 4,551		$ 4,551		$ 3,901
Total lease liabilities		3,565		3,565		2,973	$ 200
Operating lease cost		300	$ 400	672	$ 742
Rent expense under operating leases		800	$ 500	1,400	$ 1,000
Restricted cash		1,362		1,362		1,372
Operating and Finance Leases [Member]
Operating Leases [Abstract]
Restricted cash		800		800		800
Renovacor, Inc. [Member]
Operating Leases [Abstract]
Rental income received under sublease agreements		$ 100		$ 200
Remaining lease term		1 year 3 months 18 days		1 year 3 months 18 days
Total right-of-use asset		$ 3,800		$ 3,800
Total lease liabilities		$ 3,600		$ 3,600
Hopewell, New Jersey and Cambridge [Member] \| Renovacor, Inc. [Member]
Operating Leases [Abstract]
Remaining lease term		10 years 3 months 18 days		10 years 3 months 18 days
ESB Lease Agreement [Member]
Operating Leases [Abstract]
Term of lease agreement								3 years
Letter of credit								$ 800
Lease expiration date				Sep. 30, 2027
Certificate of deposit		$ 800		$ 800		$ 800
ESB Lease Agreement Amendment [Member]
Operating Leases [Abstract]
Letter of credit		$ 800		$ 800
Lease expiration date	Jun. 30, 2024

Leases - Leases Cost (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Leases - Leases Cost (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Lease cost [Abstract]
Operating lease cost	$ 300	$ 400	$ 672	$ 742
Finance Lease Costs [Abstract]
Amortization of right of use assets			1,077	1,077
Interest on lease liabilities			942	936
Total lease cost			$ 2,691	$ 2,755

Leases - Future Lease Payments of Operating Lease Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Future Lease Payments of Operating Lease Liabilities [Abstract]
2024 (six months)	$ 533
2025	1,001
2026	1,005
2027	759
2028	522
Thereafter	2,420
Total lease payments	6,240
Less: interest	(1,642)
Total operating lease liabilities	$ 4,598	$ 3,898

Leases - Future Lease Payments of Finance Lease Liability (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Finance Lease, Liability, to be Paid, Fiscal Year Maturity [Abstract]
2024 (six months)	$ 905
2025	1,856
2026	1,911
2027	1,969
2028	2,028
Thereafter	41,003
Total lease payments	49,672
Less: interest	(28,472)
Total finance lease liability	$ 21,200	$ 21,144

Leases - Balance Sheet Information Related to Leases (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023	Mar. 31, 2023
Lease assets and liabilities [Abstract]
Operating right-of-use assets	$ 4,551	$ 3,901
Operating current lease liabilities	1,033	925
Operating noncurrent lease liabilities	3,565	2,973	$ 200
Total operating lease liabilities	4,598	3,898
Finance right-of-use assets	43,440	44,517
Finance current lease liability	1,826	1,791
Finance noncurrent lease liability	19,374	19,353
Total finance lease liability	$ 21,200	$ 21,144

Leases - Lease Related to Cash Flow Information, Lease Term and Discount Rate (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Cash Flow, Operating and Financing Activities, Lessee [Abstract]
Operating cash flows from operating leases	$ 584	$ 582
Cash flows from finance lease	$ 886	$ 862
Weighted-average remaining lease term - operating leases	6 years 10 months 24 days	7 years 10 months 24 days
Weighted-average remaining lease term - finance lease	20 years 2 months 12 days	21 years 2 months 12 days
Weighted-average discount rate - operating leases	8.82%	8.25%
Weighted-average discount rate - finance lease	8.96%	8.96%

CIRM Grants - Additional Information (Details) - LAD-1 CIRM Grant - USD ($)	Jun. 30, 2024	Jan. 02, 2024	Apr. 30, 2019
CIRM Grants [Abstract]
Grant award for clinical development support			$ 7,500,000
Milestone payments received	$ 5,900,000	$ 50,000.00
Additional payments available under grant awards program	$ 0

Related Party Transactions - Additional Information (Details) - USD ($) $ in Thousands		1 Months Ended	6 Months Ended
	Sep. 15, 2023	Sep. 30, 2023	Jun. 30, 2024
Related Party Transaction [Abstract]
Related party expenses			$ 2
Common Stock \| Pre-Funded Warrants
Related Party Transaction [Abstract]
Number of stock warrants issued to purchase shares	3,126,955
Public Offering \| Common Stock \| Pre-Funded Warrants
Related Party Transaction [Abstract]
Number of stock warrants issued to purchase shares		3,100,000

401(k) Savings Plan - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
401(k) Savings Plan [Abstract]
Percentage of matching employee contributions			4.00%
Matching employee contributions	$ 0.4	$ 0.3	$ 0.8	$ 0.6