Cytori Reports Third Quarter 2017 Business and Financial Results
November 09 2017 - 4:25PM
Cytori Therapeutics (NASDAQ:CYTX) (“Cytori” or the “Company”) today
announced its third quarter 2017 financial results and provided
updates on its corporate activity and clinical development.
Third quarter 2017 net loss was $4.8 million, or
$0.14 per share. Operating cash burn for the quarter was
approximately $4.0 million. Cytori ended the quarter with
approximately $4.8 million of cash and cash
equivalents.
Selected Key Recent
Highlights:
- U.S. STAR scleroderma clinical trial data accepted for
presentation at Systemic Sclerosis World Congress in February
2018.
- BARDA executed a $13.4 million contract option to fund the U.S.
RELIEF burn clinical trial.
- Received U.S. FDA IDE approval for RELIEF, a thermal burn pilot
trial related to ongoing BARDA contract.
Q3 2017 Financial
Performance
- Q3 2017 and year-to-date operating cash burn was $4.0 million
and $13.9 million, compared to $4.6 million and $15.4 million for
the same periods in 2016, respectively.
- Q3 2017 and year-to-date total revenues were $1.8 million and
$4.9 million, compared to $2.6 million and $8.4 million for the
same periods in 2016, respectively.
- Cash and debt principal balances at September 30, 2017 were
approximately $4.8 million and $13.0 million, respectively.
- Q3 2017 net loss was $4.8 million or $0.14 per share, compared
to $5.4 million or $0.26 per share for Q3 2016.
- Year-to-date adjusted net loss was $16.7 million, or $0.57 per
share, and excludes a $1.7 million non-cash charge for in-process
research and development expense from the Azaya Therapeutics asset
acquisition, compared to $17.1 million or $1.06 per share for the
same period in 2016.
- Year-to-date GAAP net loss was $18.4 million or $0.62 per
share, compared to $17.1 million or $1.06 per share for the same
period in 2016.
“Based on the completed analysis of our STAR trial data,
including the strong safety profile, clinically meaningful
improvements in the diffuse scleroderma subgroup and the lack of
approved treatments with this orphan condition, we intend to meet
with the U.S. FDA as soon as possible to chart next steps.” said
Dr. Marc Hedrick, President and CEO of Cytori. “Simultaneously,
manufacturing validation for our recently acquired liposomal
doxorubicin chemotherapy drug candidate, ATI-0918, a generic
version of Caelyx®, is ongoing and on track for submitting an
application to the European Medicines Agency next year while other
key cell therapy trials, specifically SCLERADEC-II and ADRESU for
scleroderma and stress urinary incontinence, respectively, march
toward full enrollment.”
Selected Key Near-Term Milestones:
- Pursue meeting with U.S. FDA to determine next steps required
to obtain Habeo™ Cell Therapy regulatory approval for
scleroderma-associated hand dysfunction.
- Begin enrollment of BARDA’s funded U.S. RELIEF burn clinical
trial.
- Complete ATI-0918 manufacturing and regulatory activities
required to prepare an application for the EMA.
- Complete enrollment of SCLERADEC-II and ADRESU clinical trials
in France and Japan, respectively.
2017 Financial Guidance -
Updated
The Company expects full year 2017 operating cash burn to be
lower than 2016, primarily due to the restructuring announced in
September 2017.
- Updated operating cash burn forecasted to be within a range of
$17 million to $19 million, a reduction from previously guided
range of $20 million to $23 million.
Management Conference Call Webcast
Cytori will host a management conference call at 5:30 p.m.
Eastern Time today to further discuss its progress. The webcast
will be available live and by replay two hours after the call and
may be accessed under "Webcasts" in the Investor Relations section
of Cytori's website. If you are unable to access the webcast, you
may dial in to the call at +1.877.402.3914, Conference ID:
5289756.
About Cytori
Cytori is a therapeutics company developing regenerative and
oncologic therapies from its proprietary cell therapy and
nanoparticle platforms for a variety of medical conditions. Data
from preclinical studies and clinical trials suggest that Cytori
Cell Therapy™ acts principally by improving blood flow, modulating
the immune system, and facilitating wound repair. As a result,
Cytori Cell Therapy™ may provide benefits across multiple disease
states and can be made available to the physician and patient at
the point-of-care through Cytori’s proprietary technologies and
products. Cytori Nanomedicine™ is developing encapsulated therapies
for regenerative medicine and oncologic indications using
technology that allows Cytori to use the benefits of its
encapsulation platform to develop novel therapeutic strategies and
reformulate other drugs to optimize their clinical properties. For
more information, visit www.cytori.com.
Cautionary Statement Regarding Forward-Looking
Statements
This press release includes forward-looking statements that
involve known and unknown risks and uncertainties. All statements,
other than historical facts are forward looking statements. Such
statements, including, without limitation, statements regarding
anticipated commercial launch of our Habeo™ therapy and ATI-0918
drug candidate (and timing thereof); completion of manufacturing
activities necessary to submit an MAA to the EMA for our ATI-0918
drug candidate; our strategy for addressing our capital
requirements through various activities, including operational
efficiencies, revenue growth and accessing the capital markets;
receipt of feedback from, and related discussions with, BARDA
regarding our future contractual relationship with BARDA (and
proposed BARDA funding of our thermal burn pilot trial); and our
expected 2017 cash burn and reasons for the anticipated cash burn;
are subject to risks and uncertainties that could cause our actual
results and financial position to differ materially. Some of these
risks include clinical, pre-clinical and regulatory uncertainties,
such as those associated with conduct and completion of the
proposed thermal burn trial, as well as the Company’s anticipated
submission of data to the EMA from the previously completed
bioequivalency trial for ATI-0918 . Specifically, the Company faces
risks in the collection and results of the STAR scleroderma and
RELIEF thermal burn trials, including enrollment risks, the risks
that clinical data from one or more of these clinical trials will
fail to demonstrate safety or efficacy of our product candidates,
and risks that insufficiently positive clinical data will adversely
affect government funding, regulatory approval pathways and
commercial prospects for our cell therapy (e.g., Habeo), and
nanomedicines product candidates. We also face risks that
investigator-initiated trials using our Cytori Cell Therapy fail to
fully enroll or otherwise are conducted in a manner that ultimately
is injurious to our business. We also face the risk that we
will be unable to time successfully manufacture our ATI-0918 drug
candidate in time to meet our projected timeline for submission of
an MAA to the EMA, or at all. We also face risks regarding
execution of our managed access program (MAP) strategy in Europe,
the Middle East and Africa (EMEA), including risks relating to our
efforts to ethically direct prospective scleroderma patients into
our MAP program. Some of these risks also include risks
relating to regulatory challenges the Company faces (including the
U.S,, EU, China, Japan and its other key geographies) due to a
number of factors including novelty of the Company’s technology and
product offerings, changes in and /or evolution of regulatory
approaches to cellular therapeutics like the Company’s in its key
geographies, and similar matters. The Company also faces risks
relating to achievement of the Company’s financial goals (including
balancing capital requirements and meeting projected 2017 operating
cash burn guidance). It is possible that the Company could face
unexpected revenue shortfalls, expense increases or other
occurrences that adversely affect our cash burn and cash management
strategies. Further the Company face risks pertaining to
dependence on third party performance and approvals (including
performance of investigator-initiated trials, outcome of BARDA’s
review of the Company’s proposed burn wound trial pursuant to its
contract with BARDA, and outcome of the EMA’s review of our
ATI-0918 MAA); performance and acceptance of the Company’s products
in clinical studies/trials and in the marketplace (including
commercial acceptance of the Company’s products in Japan and other
markets where are products are commercially available, and similar
risks); material changes in the marketplace that could adversely
impact revenue projections (including changes in market perceptions
of the Company’s products, and introduction of competitive
products); unexpected costs and expenses that could adversely
impact liquidity and shorten the Company’s current liquidity
projections (which could in turn require the Company to seek
additional debt or equity capital sooner than currently
anticipated); the Company’s reliance on key personnel; the
Company’s ability to identify and develop new programs or assets to
expand the Company’s clinical pipeline; the right of the U.S.
government (BARDA) to cut or terminate further support of the
thermal burn injury program (including any decision by BARDA not to
proceed with our proposed thermal burn trial, assuming FDA approval
of the Company’s IDE submission); the Company’s abilities to
capitalize on its internal restructuring and achieve break-even or
profitability (or to continue to reduce our operating losses); and
other risks and uncertainties described under the "Risk Factors" in
Cytori's Securities and Exchange Commission Filings, included in
the Company’s annual and quarterly reports.
There may be events in the future that the Company is unable to
predict, or over which it has no control, and its business,
financial condition, results of operations and prospects may change
in the future. The Company assumes no responsibility to update or
revise any forward-looking statements to reflect events, trends or
circumstances after the date they are made unless the Company has
an obligation under U.S. Federal securities laws to do so.
CYTORI THERAPEUTICS, INC.
CONSOLIDATED CONDENSED BALANCE
SHEETS(UNAUDITED)(in thousands,
except share and par value data)
|
|
As of September
30,2017 |
|
|
As of December 31,2016 |
|
Assets |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
4,783 |
|
|
$ |
12,560 |
|
Accounts
receivable, net of reserves of $167 in both 2017 and 2016,
respectively |
|
|
230 |
|
|
|
1,242 |
|
Restricted cash |
|
|
429 |
|
|
|
350 |
|
Inventories, net |
|
|
3,508 |
|
|
|
3,725 |
|
Other
current assets |
|
|
892 |
|
|
|
870 |
|
Total
current assets |
|
|
9,842 |
|
|
|
18,747 |
|
|
|
|
|
|
|
|
|
|
Property and equipment,
net |
|
|
3,308 |
|
|
|
1,157 |
|
Other assets |
|
|
1,854 |
|
|
|
2,336 |
|
Intangibles, net |
|
|
7,520 |
|
|
|
8,447 |
|
Goodwill |
|
|
3,922 |
|
|
|
3,922 |
|
Total
assets |
|
$ |
26,446 |
|
|
$ |
34,609 |
|
Liabilities and
Stockholders’ Equity |
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
|
Accounts
payable and accrued expenses |
|
$ |
4,907 |
|
|
$ |
5,872 |
|
Current
portion of long-term obligations, net of discount |
|
|
13,497 |
|
|
|
6,629 |
|
Total
current liabilities |
|
|
18,404 |
|
|
|
12,501 |
|
|
|
|
|
|
|
|
|
|
Deferred revenues |
|
|
103 |
|
|
|
97 |
|
Long-term deferred rent
and other |
|
|
120 |
|
|
|
17 |
|
Long-term obligations,
net of discount, less current portion |
|
|
|
|
|
|
11,008 |
|
Total
liabilities |
|
|
18,627 |
|
|
|
23,623 |
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’
equity: |
|
|
|
|
|
|
|
|
Series A
3.6% convertible preferred stock, $0.001 par value; 5,000,000
shares authorized; 13,500 shares issued; no shares
outstanding in 2017 and 2016 |
|
|
— |
|
|
|
— |
|
Common
stock, $0.001 par value; 75,000,000 shares authorized; 34,716,318
and 21,707,890 shares issued and outstanding in 2017 and
2016, respectively |
|
|
35 |
|
|
|
22 |
|
Additional paid-in capital |
|
|
404,047 |
|
|
|
388,769 |
|
Accumulated other comprehensive income |
|
|
1,199 |
|
|
|
1,258 |
|
Accumulated deficit |
|
|
(397,462 |
) |
|
|
(379,063 |
) |
Total
stockholders’ equity |
|
|
7,819 |
|
|
|
10,986 |
|
Total
liabilities and stockholders’ equity |
|
$ |
26,446 |
|
|
$ |
34,609 |
|
CYTORI THERAPEUTICS, INC.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS AND
COMPREHENSIVE LOSS(UNAUDITED)(in
thousands, except share and per share data)
|
|
For the Three Months Ended
September 30, |
|
|
For the Nine Months Ended September
30, |
|
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2016 |
|
Product revenues |
|
$ |
467 |
|
|
$ |
731 |
|
|
$ |
2,027 |
|
|
$ |
3,190 |
|
Cost of product
revenues |
|
|
181 |
|
|
|
561 |
|
|
|
992 |
|
|
|
1,533 |
|
Amortization of
intangible assets |
|
|
306 |
|
|
|
57 |
|
|
|
919 |
|
|
|
237 |
|
Gross
(loss) profit |
|
|
(20 |
) |
|
|
113 |
|
|
|
116 |
|
|
|
1,420 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Development
revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Government contracts and other |
|
|
1,306 |
|
|
|
1,879 |
|
|
|
2,856 |
|
|
|
5,163 |
|
|
|
|
1,306 |
|
|
|
1,879 |
|
|
|
2,856 |
|
|
|
5,163 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research
and development |
|
|
3,004 |
|
|
|
3,960 |
|
|
|
9,284 |
|
|
|
13,334 |
|
Sales and
marketing |
|
|
840 |
|
|
|
818 |
|
|
|
3,043 |
|
|
|
2,742 |
|
General
and administrative |
|
|
1,785 |
|
|
|
2,011 |
|
|
|
6,012 |
|
|
|
6,623 |
|
In
process research and development acquired from Azaya
Therapeutics |
|
|
— |
|
|
|
— |
|
|
|
1,686 |
|
|
|
— |
|
Total
operating expenses |
|
|
5,629 |
|
|
|
6,789 |
|
|
|
20,025 |
|
|
|
22,699 |
|
Operating
loss |
|
|
(4,343 |
) |
|
|
(4,797 |
) |
|
|
(17,053 |
) |
|
|
(16,116 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income |
|
|
5 |
|
|
|
4 |
|
|
|
24 |
|
|
|
8 |
|
Interest
expense |
|
|
(474 |
) |
|
|
(645 |
) |
|
|
(1,603 |
) |
|
|
(1,947 |
) |
Other
income, net |
|
|
5 |
|
|
|
54 |
|
|
|
233 |
|
|
|
928 |
|
Total other expense |
|
|
(464 |
) |
|
|
(587 |
) |
|
|
(1,346 |
) |
|
|
(1,011 |
) |
Net
loss |
|
$ |
(4,807 |
) |
|
$ |
(5,384 |
) |
|
$ |
(18,399 |
) |
|
$ |
(17,127 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net
loss per share |
|
$ |
(0.14 |
) |
|
$ |
(0.26 |
) |
|
$ |
(0.62 |
) |
|
$ |
(1.06 |
) |
Basic and diluted
weighted average shares used in calculating net loss per share |
|
|
34,490,828 |
|
|
|
20,493,840 |
|
|
|
29,564,032 |
|
|
|
16,147,042 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive
loss: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(4,807 |
) |
|
$ |
(5,384 |
) |
|
$ |
(18,399 |
) |
|
$ |
(17,127 |
) |
Other comprehensive
loss – foreign currency translation adjustments |
|
|
16 |
|
|
|
58 |
|
|
|
(59 |
) |
|
|
(321 |
) |
Comprehensive loss |
|
$ |
(4,791 |
) |
|
$ |
(5,326 |
) |
|
$ |
(18,458 |
) |
|
$ |
(17,448 |
) |
CYTORI THERAPEUTICS,
INC.CONSOLIDATED CONDENSED STATEMENTS OF CASH
FLOWS(UNAUDITED)(in
thousands)
|
|
For the Nine Months Ended
September 30, |
|
|
|
2017 |
|
|
2016 |
|
Cash flows from
operating activities: |
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(18,399 |
) |
|
$ |
(17,127 |
) |
Adjustments to
reconcile net loss to net cash used in operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
1,618 |
|
|
|
794 |
|
Amortization of deferred financing costs and debt discount |
|
|
580 |
|
|
|
714 |
|
In
process research and development acquired from Azaya
Therapeutics |
|
|
1,686 |
|
|
|
— |
|
Joint
Venture acquisition obligation accretion |
|
|
— |
|
|
|
24 |
|
Provision
for expired inventory |
|
|
413 |
|
|
|
26 |
|
Stock-based compensation expense |
|
|
588 |
|
|
|
925 |
|
Loss on
asset disposal |
|
|
9 |
|
|
|
2 |
|
Increases
(decreases) in cash caused by changes in operating assets and
liabilities: |
|
|
|
|
|
|
|
|
Accounts
receivable |
|
|
991 |
|
|
|
91 |
|
Inventories |
|
|
457 |
|
|
|
190 |
|
Other
current assets |
|
|
(284 |
) |
|
|
205 |
|
Other
assets |
|
|
74 |
|
|
|
32 |
|
Accounts
payable and accrued expenses |
|
|
(1,746 |
) |
|
|
(1,013 |
) |
Deferred
revenues |
|
|
6 |
|
|
|
(8 |
) |
Long-term
deferred rent |
|
|
103 |
|
|
|
(227 |
) |
Net cash used in operating activities |
|
|
(13,904 |
) |
|
|
(15,372 |
) |
Cash flows from
investing activities: |
|
|
|
|
|
|
|
|
Purchases of property
and equipment |
|
|
(271 |
) |
|
|
(110 |
) |
Proceeds from sale of
assets |
|
|
10 |
|
|
|
— |
|
Purchase of long-lived
assets part of Azaya Therapeutics' acquisition |
|
|
(1,201 |
) |
|
|
— |
|
Change in restricted
cash |
|
|
(79 |
) |
|
|
— |
|
Net cash
used in investing activities |
|
|
(1,541 |
) |
|
|
(110 |
) |
Cash flows from
financing activities: |
|
|
|
|
|
|
|
|
Principal payments on
long-term obligations |
|
|
(4,720 |
) |
|
|
— |
|
Joint Venture purchase
payments |
|
|
— |
|
|
|
(1,774 |
) |
Proceeds from sale of
common stock, net |
|
|
12,377 |
|
|
|
17,702 |
|
Net cash
provided by financing activities |
|
|
7,657 |
|
|
|
15,928 |
|
Effect of
exchange rate changes on cash and cash equivalents |
|
|
11 |
|
|
|
140 |
|
Net
(decrease) increase in cash and cash equivalents |
|
|
(7,777 |
) |
|
|
586 |
|
Cash and cash
equivalents at beginning of period |
|
|
12,560 |
|
|
|
14,338 |
|
Cash and cash
equivalents at end of period |
|
$ |
4,783 |
|
|
$ |
14,924 |
|
Cytori
Therapeutics contact |
Tiago Girao |
+1.858.458.0900 |
ir@cytori.com |
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