Athersys, Inc. (Nasdaq:ATHX) today announced its financial results
for the three months ended March 31, 2015.
Highlights of the first quarter of 2015 and
recent events include:
- Entered into an exclusive license agreement with Chugai
Pharmaceutical Co., Ltd. (“Chugai”) to develop and commercialize
our MultiStem® cell therapy for the treatment of ischemic stroke in
Japan, which included an up-front payment of $10 million and an
additional $195 million of potential future payments and
royalties;
- Announced interim results from the Phase 2 clinical study of
MultiStem to treat ischemic stroke demonstrating that, while
failing to meet the primary endpoints of this study, MultiStem cell
therapy exhibits a favorable safety profile and appears to provide
substantial benefit to ischemic stroke patients provided they
receive treatment within 36 hours of the stroke;
- Launched grant-supported Phase 2 clinical study to evaluate the
administration of MultiStem cells to patients who have suffered a
severe, non-ST-elevated acute myocardial infarction, based on
promising preclinical and Phase 1 results;
- Awarded grant of approximately £2.0 million from Innovate UK,
the United Kingdom’s innovation agency which funds and supports
innovation to accelerate sustained economic growth, with proceeds
to be received over time to support a clinical study centered in
the United Kingdom, exploring MultiStem treatment of acute
respiratory distress syndrome (“ARDS”) patients;
- Received notification from Pfizer Inc. that, following an
internal portfolio review, it no longer intended to invest in the
cell therapy program for ulcerative colitis and would terminate the
2009 license agreement between us, effective July 2015;
- Reported revenues of $0.7 million for quarter ended March 31,
2015 and net loss of $12.5 million for the period, which includes
non-cash expense of $5.6 million related to the change in fair
value of our warrant liabilities and $0.8 million related to
stock-based compensation;
- Recorded net loss per share of $0.16 for the quarter ended
March 31, 2015, which reflects the non-cash expense impact of $0.08
per share from the $6.4 million in aggregate non-cash items noted
above, and also does not include any revenue from the Chugai
collaboration which is deferred at March 31, 2015;
- Added $11.4 million of cash to the balance sheet to date in
2015 from a combination of warrant exercises and stock sales under
our equity facility; and
- Ended the quarter with $35.5 million in cash and cash
equivalents.
“We have made meaningful progress during the period,” said Dr.
Gil Van Bokkelen, Chairman and CEO of Athersys, Inc. “In
March, we announced that we entered into a license agreement and
collaboration with Chugai to develop MultiStem cell therapy for
treating ischemic stroke in Japan. More recently, we reported
initial results from our ongoing Phase 2 trial for treating stroke,
which suggest that patients who receive MultiStem treatment within
36 hours following the stroke may benefit substantially from the
treatment, providing a good path for subsequent development.
In addition, we have launched our Phase 2 clinical trial evaluating
MultiStem administration to patients that have suffered damage from
a myocardial infarction, and we have received grant funding to
support exploratory clinical work in ARDS, a serious immunological
and inflammatory condition affecting the lungs.
“With respect to our stroke study results,
MultiStem treatment was associated with favorable safety and
tolerability, consistent with our prior studies,” continued Dr. Van
Bokkelen. “MultiStem treatment was also associated with lower
rates of mortality and life threatening adverse events, infections
and pulmonary events, and a reduction in hospitalization.
Additionally, a higher proportion of MultiStem treated patients
achieved an excellent clinical outcome, which is defined by
achieving excellent scores in each of the three clinical evaluation
scales used to assess patient recovery. Further, our analyses
show that patients who received MultiStem treatment earlier in the
treatment window (24-36 hours post-stroke) had better recovery in
comparison to those patients that received placebo in a number of
parameters, including substantially reduced hospitalization times
and reduced time in the Intensive Care Unit. Improved
recovery was more pronounced for MultiStem administration earlier
in the 24-36 hour timeframe.
“We believe the evidence indicating that
patients who received MultiStem treatment early appeared to exhibit
meaningfully better recovery is very important and promising,”
added Dr. Van Bokkelen. “The results suggest the window of
intervention with MultiStem therapy may meaningfully extend the
limits of current standard of care and are generally consistent
with our initial clinical hypothesis.
“Finally, we added capital to the balance sheet
during the period through our license with Chugai, and as a result
of warrant exercises and the utilization of our equity
facility. This has left us with a good foundation for
supporting our ongoing and planned development,” concluded Dr. Van
Bokkelen.
First Quarter
Results
For the three months ended March 31, 2015, there
was no change from the prior year period in our revenues of $0.7
million, with both contract and grant revenues consistent with the
prior-year period. The $10 million up-front payment from Chugai is
recorded as deferred revenue at March 31, 2015, in accordance with
our accounting policy for recognizing revenue for multiple element
arrangements.
Research and development expenses were $5.7
million for the first quarter of 2015 compared to $6.2 million for
the first quarter of 2014. The decrease is comprised of lower
clinical and preclinical development costs, patent legal fees and
sponsored research costs, which were partially offset by higher
personnel costs and stock-based compensation. General and
administrative expenses were relatively consistent between the
periods at $1.9 million for the three months ended March 31, 2015
and $1.8 million in the prior year three-month period. The non-cash
expense from the change in the fair value of our warrant
liabilities was $5.6 million in the first quarter of 2015 and $4.1
million in the prior-year period.
Net loss for the three months ended March 31,
2015 was $12.5 million, which includes non-cash expenses
aggregating $6.4 million from warrant and stock-based compensation,
compared to a net loss of $11.5 million for the three months ended
March 31, 2014.
As of March 31, 2015, we had $35.5 million in
cash and cash equivalents, compared to $26.1 million at December
31, 2014. Cash provided by operating activities during the
first quarter of 2015 was $1.1 million compared to $7.3 million
cash used in the first quarter of 2014. Included in the 2015
first quarter cash from operating activities was Chugai’s $10
million up-front payment, less $2 million temporarily withheld by
the Japan taxing authorities, which is refundable to us under
applicable U.S. and Japan tax treaties and is recorded as a current
receivable. Cash provided by financing activities was $8.3
million in the 2015 first quarter compared to $20.5 million in the
prior-year first quarter. While both periods included warrant
exercises and proceeds from the use of our equity facility, the
2014 first quarter also included an equity financing.
Conference Call
As previously announced, Gil Van Bokkelen,
Chairman and Chief Executive Officer, and William (B.J.) Lehmann,
President and Chief Operating Officer, will host a conference call
today to review the results as follows:
Date |
May 11, 2015 |
Time |
4:30 p.m. (Eastern Time) |
Telephone access: U.S. and Canada |
800-273-1254 |
Telephone access: International |
973-638-3440 |
Access code |
22710389 |
Live webcast |
www.athersys.com, under the Investors section |
A replay will be available for on-demand
listening shortly after the completion of the call until 11:59 PM
(Eastern Time) on May 25, 2015 by dialing 800-585-8367 or
855-859-2056 (U.S. and Canada), or 404-537-3406, and entering
access code 22710389. The archived webcast will be available for
one year at the aforementioned URL.
About Athersys
Athersys is a clinical stage biotechnology
company engaged in the discovery and development of therapeutic
product candidates designed to extend and enhance the quality of
human life. The Company is developing its MultiStem® cell therapy
product, a patented, adult-derived "off-the-shelf" stem cell
product platform for disease indications in the cardiovascular,
neurological, inflammatory and immune disease areas. The Company
currently has several clinical stage programs involving MultiStem,
including for treating inflammatory bowel disease, ischemic stroke,
damage caused by myocardial infarction, and for the prevention of
graft-versus-host disease. Athersys has also developed a diverse
portfolio that includes other technologies and product development
opportunities, and has forged strategic partnerships and
collaborations with leading pharmaceutical and biotechnology
companies, as well as world-renowned research institutions in the
United States and Europe to further develop its platform and
products. More information is available at www.athersys.com.
The Athersys, Inc. logo is available at:
http://www.globenewswire.com/newsroom/prs/?pkgid=4548.
Forward-Looking Statements
This press release contains forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995 that involve risks and uncertainties. These
forward-looking statements relate to, among other things, the
expected timetable for development of our product candidates, our
growth strategy, and our future financial performance, including
our operations, economic performance, financial condition,
prospects, and other future events. We have attempted to identify
forward-looking statements by using such words as "anticipates,"
"believes," "can," "continue," "could," "estimates," "expects,"
"intends," "may," "plans," "potential," "should," “suggest,”
"will," or other similar expressions. These forward-looking
statements are only predictions and are largely based on our
current expectations. A number of known and unknown risks,
uncertainties, and other factors could affect the accuracy of these
statements. Some of the more significant known risks that we face
that could cause actual results to differ materially from those
implied by forward-looking statements are the risks and
uncertainties inherent in the process of discovering, developing,
and commercializing products that are safe and effective for use as
human therapeutics, such as the uncertainty regarding market
acceptance of our product candidates and our ability to generate
revenues, including MultiStem for the treatment of inflammatory
bowel disease, acute myocardial infarction, stroke and other
potential indications, including lysosomal storage disorders and
the prevention of graft-versus-host disease. These risks and
uncertainties may cause our actual results, levels of activity,
performance, or achievements to differ materially from any future
results, levels of activity, performance, or achievements expressed
or implied by these forward-looking statements. Other important
factors to consider in evaluating our forward-looking statements
include: our ability to raise additional capital, including Chugai
electing to make the additional payment to continue our ischemic
stroke collaboration in Japan; final results from our MultiStem
clinical trials; the possibility of delays in, adverse results of,
and excessive costs of the development process; our ability to
successfully initiate and complete clinical trials and obtain all
necessary regulatory approvals; changes in external market factors;
changes in our industry's overall performance; changes in our
business strategy; our ability to protect our intellectual property
portfolio; our possible inability to realize commercially valuable
discoveries in our collaborations with pharmaceutical and other
biotechnology companies; our ability to meet milestones under our
collaboration agreements; our collaborators' ability to continue to
fulfill their obligations under the terms of our collaboration
agreements; the success of our efforts to enter into new strategic
partnerships and advance our programs; our possible inability to
execute our strategy due to changes in our industry or the economy
generally; changes in productivity and reliability of suppliers;
and the success of our competitors and the emergence of new
competitors. You should not place undue reliance on forward-looking
statements contained in this press release, and we undertake no
obligation to publicly update forward-looking statements, whether
as a result of new information, future events or otherwise.
(Tables Follow)
Athersys,
Inc. |
Condensed
Consolidated Balance Sheets |
(In
thousands) |
|
|
|
|
|
March
31, |
December
31, |
|
2015 |
2014 |
|
(Unaudited) |
(Note) |
Assets |
|
|
Cash and cash equivalents |
$ |
35,505 |
|
$ |
26,127 |
|
Accounts and other receivables |
|
2,837 |
|
|
694 |
|
Other current assets |
|
386 |
|
|
427 |
|
Equipment, net |
|
1,263 |
|
|
1,270 |
|
Other noncurrent assets |
|
200 |
|
|
200 |
|
Total assets |
$ |
40,191 |
|
$ |
28,718 |
|
|
|
|
Liabilities and stockholders’
equity |
|
|
Accounts payable and accrued expenses |
$ |
3,939 |
|
$ |
4,617 |
|
Deferred revenue |
|
10,027 |
|
|
75 |
|
Warrant liabilities |
|
7,025 |
|
|
2,948 |
|
Note payable |
|
185 |
|
|
183 |
|
Total stockholders’ equity |
|
19,015 |
|
|
20,895 |
|
Total liabilities and stockholders’
equity |
$ |
40,191 |
|
$ |
28,718 |
|
|
|
Note: The
Condensed Consolidated Balance Sheet Data at December 31, 2014 has
been derived from the audited financial statements as of that date.
|
|
Athersys,
Inc. |
Condensed
Consolidated Statements of Operations and Comprehensive
Loss |
(In Thousands,
Except Per Share Amounts) |
|
|
|
|
|
Three Months ended March
31, |
|
|
2015 |
|
|
2014 |
|
|
(Unaudited) |
Revenues |
|
|
Contract revenue |
$ |
106 |
|
$ |
44 |
|
Grant revenue |
|
625 |
|
|
663 |
|
Total revenues |
|
731 |
|
|
707 |
|
|
|
|
Costs and Expenses |
|
|
Research and development |
|
5,668 |
|
|
6,226 |
|
General and administrative |
|
1,886 |
|
|
1,781 |
|
Depreciation |
|
70 |
|
|
89 |
|
Total costs and expenses |
|
7,624 |
|
|
8,096 |
|
Loss from operations |
|
(6,893 |
) |
|
(7,389 |
) |
|
|
|
Other income, net |
|
15 |
|
|
29 |
|
Expense from change in fair value of
warrants |
|
(5,604 |
) |
|
(4,124 |
) |
Net loss and comprehensive
loss |
$ |
(12,482 |
) |
$ |
(11,484 |
) |
|
|
|
|
|
|
|
Basic and diluted net loss per common share |
$ |
(0.16 |
) |
$ |
(0.15 |
) |
Weighted average shares outstanding, basic and
diluted |
|
79,181 |
|
|
75,853 |
|
|
|
|
|
Contacts:
William (B.J.) Lehmann, J.D.
President and Chief Operating Officer
Tel: (216) 431-9900
bjlehmann@athersys.com
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