Geron Corporation (Nasdaq: GERN) today reported financial results
for the three and six months ended June 30, 2018.
Second Quarter and Year to Date 2018
Results
For the second quarter of 2018, the Company reported a net loss
of $6.9 million, or $0.04 per share, compared to $6.4 million, or
$0.04 per share, for the comparable 2017 period. Net loss for the
first six months of 2018 was $14.1 million, or $0.08 per share,
compared to $13.6 million, or $0.09 per share, for the comparable
2017 period.
Revenues for the three and six months ended June 30, 2018 were
$208,000 and $526,000, respectively, compared to $174,000 and
$711,000 for the comparable 2017 periods. Revenues for the three
and six months ended June 30, 2018 and 2017 included royalty and
license fee revenues under various non-imetelstat license
agreements. The Company adopted the new revenue recognition
accounting standard as of January 1, 2018 using the modified
retrospective transition method. Financial results for the three
and six months ended June 30, 2018 are presented under the new
accounting standard, but prior period amounts have not been
adjusted and continue to be reported under accounting standards
used historically. Therefore, there is a lack of comparability to
the prior periods presented. As a result, the decrease in revenues
for the six months ended June 30, 2018, compared to the same period
in 2017, reflects not only a reduction in the number of active
non-imetelstat license agreements and decreased product sales from
licensees, but also a change in the method accounting. However, the
Company does not expect the adoption of the new revenue recognition
accounting standard to have a material impact to its financial
statements on an ongoing basis.
Total operating expenses for the three and six months ended June
30, 2018 were $7.4 million and $15.2 million, respectively,
compared to $6.9 million and $14.9 million for the comparable 2017
periods. Research and development expenses for the three and six
months ended June 30, 2018 were $3.2 million and $5.6 million,
respectively, compared to $2.5 million and $5.9 million for the
comparable 2017 periods. The changes in research and development
expenses for the three and six months ended June 30, 2018, compared
to the same periods in 2017, primarily reflect the variation in
costs for our proportionate share of clinical development expenses
under the imetelstat collaboration with Janssen Biotech, Inc.
(Janssen). General and administrative expenses for the three and
six months ended June 30, 2018 were $4.2 million and $9.6 million,
respectively, compared to $4.4 million and $9.1 million for the
comparable 2017 periods. The overall increase in general and
administrative expenses for the six months ended June 30, 2018,
compared to the same period in 2017, primarily reflects the net
result of higher legal and consulting costs, partially offset by
lower stock-based compensation expense.
Interest and other income for the three and six months ended
June 30, 2018 was $717,000 and $1.1 million, respectively, compared
to $346,000 and $678,000 for the comparable 2017 periods. The
increase in interest and other income for the three and six months
ended June 30, 2018, compared to the same periods in 2017,
primarily reflects higher yields on the company’s increased
marketable securities portfolio.
The Company ended the second quarter of 2018 with $181.4 million
in cash and marketable securities. Since December 2017, the Company
has raised cumulative net cash proceeds of approximately $87
million from the sales of an aggregate of 23,892,415 shares of
common stock under At Market Issuance Sales Agreements (Sales
Agreements) after deducting sales commissions and offering expenses
payable by Geron. The Company expects these net cash proceeds to
provide additional capital structure flexibility under different
scenarios. If Janssen elects to continue the collaboration, the
funds can potentially support the future shared development of
imetelstat and Geron’s business development efforts to diversify
its business through in-licensing or acquisitions. If Janssen
elects to discontinue the collaboration, and Geron chooses to
continue development of imetelstat, the funds can support future
development costs, including potentially the start of the Phase 3
portion of IMerge.
Recent Company Events
“We still expect Janssen’s decision whether to continue
imetelstat development by the end of the third quarter,” said John
A. Scarlett, M.D., Geron’s President and Chief Executive Officer.
“During the second quarter, we strengthened our balance sheet and
made progress on our plans to address either scenario resulting
from Janssen’s decision. Therefore, we are confident in our ability
to manage our business effectively going forward.”
IMbark Status
IMbark is a Phase 2 trial in patients with Intermediate-2 or
High Risk myelofibrosis (MF) who have relapsed after or are
refractory to prior treatment with a JAK inhibitor. In March 2018,
Janssen officially closed the trial to new patient enrollment. In
the second quarter of 2018, Janssen initiated a protocol-specified
primary analysis of IMbark, which includes an assessment of overall
survival. The Company expects that following completion of the
protocol-specified primary analysis, Janssen will notify Geron
whether it elects to maintain the license rights and continue the
development of imetelstat in any indication (the Continuation
Decision). Geron expects Janssen to inform the Company of its
decision by the end of the third quarter of 2018.
IMerge Status
IMerge is a two-part clinical trial evaluating imetelstat in
transfusion dependent patients with Low or Intermediate-1 risk
myelodysplastic syndromes (MDS) who have relapsed after or are
refractory to prior treatment with an erythropoiesis stimulating
agent, or ESA. The primary efficacy endpoint is the rate of red
blood cell transfusion independence lasting at least 8 weeks. Part
1 is a Phase 2, open-label, single-arm trial of imetelstat, and
Part 2 is designed to be a Phase 3, randomized, controlled trial.
Part 2 has not yet begun.
On June 17, 2018, updated data from the original Part 1 of
IMerge was presented at the 23rd Congress of the European
Hematology Association (EHA) held in Stockholm, Sweden. The oral
presentation described data as of May 2018 from the first 32
patients enrolled in Part 1 of IMerge with a median follow-up of 95
weeks. These data showed that among the 32 red blood cell
transfusion-dependent MDS patients enrolled in Part 1, a subset of
13 patients who had not received prior treatment with either a
hypomethylating agent or lenalidomide and were non-del(5q),
exhibited an increased rate and durability of transfusion
independence compared to the overall trial population.
The slide presentation from the EHA conference is available on
Geron’s website at www.geron.com/r-d/publications.
Based on preliminary data from Part 1 of IMerge, Janssen
expanded new patient enrollment in Part 1 and enrolled
approximately 25 additional patients who are naïve to lenalidomide
and HMA treatment and are non-del(5q) to increase the experience
and evaluate the benefit-risk profile of imetelstat in this refined
target patient population. In November 2017, the first patient was
dosed in the expanded Part 1 of IMerge and enrollment was completed
in February 2018.
Conference Call and Webcast
Geron will host a conference call to discuss second quarter
financial results and recent events at 4:30 p.m. ET on Tuesday,
July 31, 2018.
Participants may access the conference call live via telephone
by dialing domestically +1 (877) 303-9139 or internationally +1
(760) 536-5195. The passcode is 9464589. A live, listen-only
webcast will also be available through on the Company’s website at
www.geron.com/investors/events. If you are unable to listen to the
live call, an archived webcast will be available on the Company’s
website for 30 days.
About Geron
Geron is a clinical stage biopharmaceutical company supporting
the collaborative development of a first-in-class telomerase
inhibitor, imetelstat, in hematologic myeloid malignancies. For
more information about Geron, visit www.geron.com.
Use of Forward-Looking Statements
Except for the historical information contained herein, this
press release contains forward-looking statements made pursuant to
the “safe harbor” provisions of the Private Securities Litigation
Reform Act of 1995. Investors are cautioned that such statements
regarding: (i) that Janssen will complete a primary analysis for
IMbark; (ii) that Janssen will inform Geron of its decision after
completion of the primary analysis; (iii) that Janssen will inform
Geron of its decision by the end of the third quarter of 2018; (iv)
that the net cash proceeds from the Sales Agreements will provide
capital structure flexibility under either a Janssen continue or
discontinue scenario: (v) the impact of the adoption of new
accounting standards; and (vi) other statements that are not
historical facts, constitute forward-looking statements. These
statements involve risks and uncertainties that can cause actual
results to differ materially from those in such forward-looking
statements. These risks and uncertainties, include, without
limitation, risks and uncertainties related to: (i) whether the
results from IMbark and IMerge and other factors meet the criteria
set by Janssen to continue development of imetelstat; (ii) whether
Janssen decides not to complete a primary analysis for IMbark and
to terminate the imetelstat program and the collaboration
agreement; (iii) that Janssen may terminate the collaboration
agreement at any time; (iv) whether Janssen will request an
extension of time to make its Continuation Decision; (v) whether
Janssen will make a positive Continuation Decision without
renegotiating the terms of the collaboration agreement; and (vi)
that Geron’s need for future capital is greater than Geron’s
expectations. Additional information on the above risks and
uncertainties and additional risks, uncertainties and factors that
could cause actual results to differ materially from those in the
forward-looking statements are contained in Geron’s periodic
reports filed with the Securities and Exchange Commission under the
heading “Risk Factors,” including Geron’s quarterly report on Form
10-Q for the quarter ended June 30, 2018. Undue reliance should not
be placed on forward-looking statements, which speak only as of the
date they are made, and the facts and assumptions underlying the
forward-looking statements may change. Except as required by law,
Geron disclaims any obligation to update these forward-looking
statements to reflect future information, events or
circumstances.
CONTACT:
Suzanne MessereInvestor and Media
Relationsinvestor@geron.commedia@geron.com
CG Capital887-889-1972
Financial table follows.
|
|
GERON CORPORATION |
CONDENSED STATEMENTS OF
OPERATIONS |
(UNAUDITED) |
|
|
Three Months Ended |
Six Months Ended |
|
June 30, |
June 30, |
(In thousands, except share and per share data) |
2018 |
2017 |
2018 |
2017 |
|
|
|
|
|
Revenues: |
|
|
|
|
License fees and royalties |
$ |
208 |
|
$ |
174 |
|
$ |
526 |
|
$ |
711 |
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
Research and development |
|
3,204 |
|
|
2,499 |
|
|
5,644 |
|
|
5,873 |
|
General and administrative |
|
4,246 |
|
|
4,406 |
|
|
9,561 |
|
|
9,063 |
|
Total operating expenses |
|
7,450 |
|
|
6,905 |
|
|
15,205 |
|
|
14,936 |
|
Loss from operations |
|
(7,242 |
) |
|
(6,731 |
) |
|
(14,679 |
) |
|
(14,225 |
) |
|
|
|
|
|
|
|
|
|
Interest and other income |
|
717 |
|
|
346 |
|
|
1,111 |
|
|
678 |
|
Change in fair value of equity investment |
|
(350 |
) |
|
— |
|
|
(475 |
) |
|
— |
|
Other expense |
|
(59 |
) |
|
(20 |
) |
|
(77 |
) |
|
(41 |
) |
Net loss |
$ |
(6,934 |
) |
$ |
(6,405 |
) |
$ |
(14,120 |
) |
$ |
(13,588 |
) |
|
|
|
|
|
|
|
|
|
Basic and diluted net loss per share: |
|
|
|
|
|
|
|
|
Net loss per share |
$ |
(0.04 |
) |
$ |
(0.04 |
) |
$ |
(0.08 |
) |
$ |
(0.09 |
) |
Shares used in computing net loss per share |
|
174,475,244 |
|
|
159,182,367 |
|
|
167,538,530 |
|
|
159,171,959 |
|
|
|
|
CONDENSED BALANCE
SHEETS |
|
June 30, |
December 31, |
(In
thousands) |
2018 |
2017 |
|
(Unaudited) |
(Note 1) |
Current
assets: |
|
|
Cash, cash equivalents and restricted cash |
$ |
19,396 |
$ |
16,603 |
Current marketable securities |
|
141,800 |
|
78,351 |
Other current assets |
|
1,074 |
|
1,016 |
Total current assets |
|
162,270 |
|
95,970 |
|
|
|
|
|
Noncurrent
marketable securities |
|
20,250 |
|
14,241 |
Property
and equipment, net |
|
71 |
|
102 |
Other
assets |
|
676 |
|
— |
|
$ |
183,267 |
$ |
110,313 |
|
|
|
|
|
Current
liabilities |
$ |
4,905 |
$ |
6,516 |
Stockholders’ equity |
|
178,362 |
|
103,797 |
|
$ |
183,267 |
$ |
110,313 |
Note 1: Derived from
audited financial statements included in the Company’s annual
report on Form 10-K for the year ended December 31, 2017.
Geron (NASDAQ:GERN)
Historical Stock Chart
From Aug 2024 to Sep 2024
Geron (NASDAQ:GERN)
Historical Stock Chart
From Sep 2023 to Sep 2024