Athersys, Inc. (NASDAQ: ATHX) announced today its financial results
for the three months ended September 30, 2019.
Highlights of the third quarter of 2019 and recent events
include:
- Steady advancement of both MultiStem® ischemic stroke clinical
trials, including the HEALIOS K.K. ("Healios") TREASURE study in
Japan and in our Phase 3 registrational study MASTERS-2;
- Continued support for the Healios' acute respiratory distress
syndrome ("ARDS") trial, the ONE-BRIDGE study in Japan, which
continues to have steady enrollment;
- Completion of one-year follow up assessments for our ARDS
trial, the MUST-ARDS study, and initiation of planning for
subsequent ARDS trial;
- Advanced preparations for planned Phase 2 trauma clinical
study;
- Progressed planning for commercial readiness with our
manufacturing process, technical transfer operations and future
manufacturing plans;
- Engaged in partnering discussions with companies interested in
MultiStem commercialization rights in Europe and other
regions;
- MultiStem recognized in the first ESOT Leonardo Da Vinci
Research Innovation Award received by Emily R. Thompson from the
University of Newcastle for her work using MultiStem in human
kidney transplant research;
- Entered in new equity facility that will replace the current
facility, providing us with access of up to $100 million to support
operational and other initiatives over the next several years;
- Recognized revenues of negative $0.4 million and net loss
of $12.0 million, or $0.08 net loss per share, for the quarter
ended September 30, 2019; and
- Ended the 2019 third quarter with $40.4 million of cash
and cash equivalents.
“We continue to make steady progress in our ongoing clinical
programs, maintaining our focus on the critical care indications
where our prior clinical results and extensive preclinical data
suggest there is an excellent opportunity for MultiStem to address
substantial areas of unmet medical need. Each of the indications we
are focused on represent significant market opportunities, where
current standard of care is limited, cost of care is high, and the
disability burden and the quality of life impact on the patient and
family is substantial,” commented Dr. Gil Van Bokkelen, Chairman
& CEO of Athersys. “We believe that MultiStem can help address
substantial gaps and limitations in current standard of care,
meaningfully improving clinical outcomes for patients, and
delivering substantial value to the healthcare system.
“We are also heavily focused on strategic partnering activities
in Europe and other geographies of interest, while we also pursue
other strategic opportunities that have the potential to add value
and strengthen our balance sheet. We are focused on preparing for
commercialization in the future and maintaining a strong financial
position while we pursue these initiatives,” concluded Dr. Van
Bokkelen.
Third Quarter Results
Our revenues are generally derived from license fees,
manufacturing-related activities for Healios, other contract
revenue from our collaborations and grant revenue. Revenues were
negative $0.4 million for the three months ended
September 30, 2019 compared to $2.3 million for the three
months ended September 30, 2018, which were primarily related
to our collaboration with Healios. In the third quarter of 2019, we
determined that the estimated variable transaction price of product
supply decreased due to a reduction in the underlying cost per dose
that occurred during the quarter. This reduction exceeded the
amount of revenue generated during the quarter. Royalty revenue
ceased late in 2018 upon a licensee's decision to discontinue
distribution of the licensed product.
Research and development expenses decreased to $8.9 million
for the three months ended September 30, 2019 from
$9.5 million for the comparable period in 2018. The
$0.6 million net decrease is associated with decreases in
clinical trial and manufacturing process development costs of
$1.1 million and license fees of $0.2 million, with such
decreases partially offset by increases in personnel costs of $0.2
million, outside services of $0.2 million, stock compensation costs
of $0.2 million, and consulting costs of $0.1 million. Included in
our clinical expenses are costs associated with providing
manufacturing services to Healios, which are invoiced to Healios in
accordance with our collaboration agreements.
General and administrative expenses increased to
$3.0 million for the three months ended September 30,
2019 from $2.6 million in the comparable period in 2018. The
$0.4 million increase was due primarily to increased legal and
professional fees, outside services and stock compensation costs
compared to the same period last year.
Net loss for the third quarter of 2019 was $12.0 million
compared to a net loss of $9.7 million in the third quarter of
2018. The difference reflects the above variances, as well as an
increase in other income.
During the nine months ended September 30, 2019, net cash
used in operating activities was $25.2 million compared to
$8.8 million in the nine months ended September 30, 2018,
with 2018 being impacted by proceeds from the Healios collaboration
expansion. At September 30, 2019, we had $40.4 million in
cash and cash equivalents, compared to $51.1 million at
December 31, 2018.
Conference Call
Gil Van Bokkelen, Chairman and Chief Executive Officer, Laura
Campbell, Senior Vice President of Finance, and Karen Hunady,
Director of Corporate Communications and Investor Relations will
host a conference call today to review the results as follows:
Date |
|
November 6, 2019 |
Time |
|
4:30 p.m. (Eastern Time) |
Telephone access: U.S. and Canada |
|
(877) 396-3286 |
Telephone access: International |
|
(647) 689-5528 |
Access code |
|
4183148 |
Live webcast |
|
www.athersys.com, under the Investors/Events section |
We encourage shareholders to listen using the webcast link and
to use the phone line if you intend to ask a question. A replay
will be available on the webcast at www.athersys.com under the
Investors section approximately two hours after the call has ended.
Shareholders may also call in for on-demand listening shortly after
the completion of the call until 11:59 PM Eastern Time on November
13, 2019 by dialing (800) 585-8367 or (416) 621-4642 and
entering Encore passcode 4183148.
About Athersys
Athersys is an international 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,
initially for disease indications in the neurological, inflammatory
and immune, cardiovascular, and other critical care indications and
has several ongoing clinical trials evaluating this potential
regenerative medicine product. Athersys has forged strategic
partnerships and a broad network of collaborations to further
advance the MultiStem cell therapy toward commercialization. More
information is available at www.athersys.com. Follow Athersys on
Twitter at www.twitter.com/athersys.
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 therapeutics, including the
uncertainty regarding market acceptance of our product candidates
and our ability to generate revenues. These risks 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 capital to fund our operations; the timing and nature of
results from our MultiStem clinical trials, including the MASTERS-2
Phase 3 clinical trial and Healios’ TREASURE and ONE-BRIDGE
clinical trials in Japan; the possibility of delays in, adverse
results of, and excessive costs of the development process; our
ability to successfully initiate and complete clinical trials of
our product candidates; the possibility of delays, work stoppages
or interruptions in manufacturing by third parties to us, such as
due to material supply constraints, contaminations, or regulatory
issues, which could negatively impact our trials and the trials of
our collaborators; uncertainty regarding market acceptance of our
product candidates and our ability to generate revenues, including
MultiStem cell therapy for the treatment of stroke, acute
respiratory distress syndrome, acute myocardial infarction and
trauma, and the prevention of graft-versus-host disease and other
disease indications; changes in external market factors; changes in
our industry's overall performance; changes in our business
strategy; our ability to protect and defend our intellectual
property and related business operations, including the successful
prosecution of our patent applications and enforcement of our
patent rights, and operate our business in an environment of rapid
technology and intellectual property development; our possible
inability to realize commercially valuable discoveries in our
collaborations with pharmaceutical and other biotechnology
companies; our ability to meet milestones and earn royalties under
our collaboration agreements, including the success of our
collaboration with Healios; our collaborators’ ability to continue
to fulfill their obligations under the terms of our collaboration
agreements and generate sales related to our technologies; the
success of our efforts to enter into new strategic partnerships and
advance our programs, including, without limitation, in North
America, Europe and Japan; 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.
Contacts:
William (B.J.) Lehmann, J.D.President and Chief Operating
OfficerTel: (216) 431-9900bjlehmann@athersys.com
Karen HunadyDirector of Corporate Communications &
Investor RelationsTel: (216) 431-9900khunady@athersys.com
David SchullRusso Partners, LLCTel: (212) 845-4271 or (858)
717-2310David.schull@russopartnersllc.com
|
Athersys, Inc. |
Condensed Consolidated Balance Sheets |
(In thousands) |
|
September 30, 2019 |
|
December 31, 2018 |
|
(Unaudited) |
|
(Note) |
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
40,446 |
|
|
$ |
51,059 |
|
Accounts receivable |
15 |
|
|
262 |
|
Accounts receivable from
Healios, billed and unbilled |
1,395 |
|
|
4,728 |
|
Prepaid expenses, deposits and
other |
2,647 |
|
|
2,679 |
|
Equipment, net |
2,928 |
|
|
3,002 |
|
Total
assets |
$ |
47,431 |
|
|
$ |
61,730 |
|
Liabilities and
stockholders’ equity |
|
|
|
Accounts payable, accrued
expenses and other |
$ |
13,911 |
|
|
$ |
12,801 |
|
Accounts payable to
Healios |
792 |
|
|
— |
|
Deposit from Healios |
— |
|
|
2,000 |
|
Deferred revenue |
351 |
|
|
674 |
|
Advance from Healios |
5,375 |
|
|
3,139 |
|
Total stockholders'
equity |
27,002 |
|
|
43,116 |
|
Total liabilities and
stockholders' equity |
$ |
47,431 |
|
|
$ |
61,730 |
|
|
|
|
|
Note: The Condensed Consolidated Balance Sheet
Data has been derived from the audited financial statements as of
that date. |
|
|
Athersys, Inc. |
Condensed Consolidated Statements of Operations and
Comprehensive Loss |
(Unaudited) |
(In Thousands, Except Per Share Amounts) |
|
|
Three months ended September 30, |
|
|
2019 |
|
2018 |
|
|
|
|
|
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
Contract revenue from
Healios |
$ |
(368 |
) |
|
$ |
1,906 |
|
Royalty and other contract
revenue |
— |
|
|
312 |
|
Grant revenue |
7 |
|
|
103 |
|
Total revenues |
(361 |
) |
|
2,321 |
|
Costs and
expenses |
|
|
|
Research and development |
8,856 |
|
|
9,545 |
|
General and
administrative |
2,958 |
|
|
2,556 |
|
Depreciation |
167 |
|
|
196 |
|
Total costs and expenses |
11,981 |
|
|
12,297 |
|
Loss from operations |
(12,342 |
) |
|
(9,976 |
) |
Other income, net |
327 |
|
|
236 |
|
Net loss and
comprehensive loss |
$ |
(12,015 |
) |
|
$ |
(9,740 |
) |
Net loss per share, basic and
diluted |
$ |
(0.08 |
) |
|
$ |
(0.07 |
) |
Weighted average shares
outstanding, basic and diluted |
153,096 |
|
|
138,930 |
|
|
|
|
|
|
|
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