Histogen Reports First Quarter 2021 Earnings and Provides Business Update
May 13 2021 - 4:01PM
Histogen Inc. (NASDAQ: HSTO), a clinical-stage therapeutics company
focused on developing potential first-in-class restorative
therapeutics that ignite the body’s natural process to repair and
maintain healthy biological function, today reported financial
results for the first quarter ended March 31, 2021 and provided an
update on its clinical pipeline and other corporate developments.
“We continue to focus on advancing our novel
pipeline and are pleased to have initiated the emricasan study for
treatment of mild symptomatic COVID-19 patients and are on track to
initiate the HST-003 study for knee cartilage repair in the second
quarter of 2021,” said Richard W. Pascoe, President and Chief
Executive Officer. We also welcomed Dr. Susan Windham-Bannister and
Rochelle Fuhrmann to our Board of Directors. Both Sue and Rochelle
bring to our board relevant industry experience with respective
expertise in strategic growth and financial management, which will
serve Histogen well. Looking forward, we will continue to focus on
the initiation and execution of the HST-003 study, delivering
top-line results of the emricasan COVID-19 trial, and completing
our evaluation of the clinical development plans for the HST 001
program.”
Highlights from the First Quarter Ended
March 31, 2021 and Business Updates
- HST-001 – In
February 2021, we announced the final results from the week 26
assessments of our study of HST-001 for the treatment of androgenic
alopecia in men. These results supported that HST-001 was shown to
be safe and well tolerated as compared to placebo with no reports
of serious adverse events but did not achieve statistical
significance at week 26 as compared to placebo. Additional
observations at week 26 included that 84% of patients treated with
HST-001, as compared to baseline, demonstrated a statistically
significant change in total hairs (terminal and vellus) within the
target area (TAHC) of the vertex as measured by Canfield’s
Hairmetrix macrophotography system. We are currently evaluating our
clinical development plans for the HST-001 program and expect to
complete our evaluation in the second quarter of 2021.
- HST-003 – In March
2021, we announced that the U.S. Food and Drug Administration
(“FDA”) confirmed that we can proceed with the initiation of our
planned Phase 1/2 clinical study of HST-003 to evaluate the safety
and efficacy of human extracellular matrix (hECM) implanted within
microfracture interstices and the cartilage defect in the knee to
regenerate hyaline cartilage in combination with a microfracture
procedure. We anticipate enrollment to commence in the second
quarter of 2021. Patients will be enrolled at three sites: Oasis MD
in San Diego, CA, The Steadman Clinic in Vail, CO, and Walter Reed
Medical Center in Bethesda, MD.
- Emricasan – In
March 2021, we, in collaboration with our partner Amerimmune,
announced dosing the first patient in the Phase 1 study of
emricasan for the treatment of mild symptomatic COVID-19 patients.
The study is designed to assess safety and tolerability and will
also include various clinical and laboratory measures and patient
reported outcomes (PROs) using the FDA COVID-19 Related Symptoms in
Outpatient Adult and Adolescent Subjects in Clinical Trials of
Drugs and Biological Products for COVID-19 Prevention or Treatment
Assessment tool. We, along with our partner Amerimmune, expect
top-line data to be available in the second quarter of 2021.
- Appointed Dr. Susan
Windham-Bannister and Rochelle Furhmann to the board of directors
– In March 2021, we continued to strengthen and diversify
our board with the appointment of Dr. Windham-Bannister and
Rochelle Fuhrmann. Dr. Windham-Bannister is an internationally
recognized expert in innovation, market access and market
optimization strategies. She has been recognized by Biosphere as
one of the “10 Most Prominent African American Science Leaders,”
the Boston Globe as one of the “10 Most Influential Women in
Biotech,” by Boston Magazine as one of the “50 Most Powerful Women
in Boston” and is the President of the National Board of Directors
of the Association for Women in Science (AWIS). Dr.
Windham-Bannister currently serves as Managing Partner of
Biomedical Innovation Advisors LLC, which she founded with Dr.
Harvey Lodish, co-founder of Genzyme, and member of the Whitehead
Institute, MIT. She also serves as the President and CEO of
Biomedical Growth Strategies, LLC. Ms. Fuhrmann currently serves as
the Vice President Audit and Enterprise Risk Management at Becton
Dickinson (BD). In 2016, Ms. Fuhrmann helped establish the BD
Foundation, and she presently serves as Treasurer and as a member
of its Board of Trustees. She joined BD in July 2015 as Senior Vice
President and Chief Financial Officer, BD Life Sciences. Prior to
joining BD, Rochelle held various positions responsible for the
management of financial functions, including accounting and
financial reporting, investor relations, corporate finance, risk
management and treasury, primarily in the pharmaceutical industry
with companies such as Amneal Pharmaceuticals and Warner Chilcott
plc. She previously served as a member of the Board of Directors of
Concordia International Corp. and held the position of Audit
Committee Chairperson for three years.
- Financings – In
January 2021, we received $14 million of gross proceeds from an S-1
offering and as of March 31, 2021, an incremental $6.8 million of
gross proceeds from the exercise of warrants associated with the
January 2021 public offering.
First Quarter 2021 Financial
Highlights
First Quarter Ended March 31, 2021 and 2020
Product and Service Revenues in
the first quarter of 2021, revenue decreased 56% to $0.4 million
from $1.0 million in the first quarter of 2020. The decrease is
primarily related to revenue recognized during the first quarter of
2020 associated with the Allergan License Agreement amendments
offset by first quarter 2021 revenue related to the final supply of
cell conditioned medium (“CCM”) to Allergan under the Allergan
License Agreements.
Cost of revenues for the three
months ended March 31, 2021 and 2020 were $0.2 million and $0.3
million, respectively. The cost of product revenue during the first
quarter of 2021 is related to the final supply of CCM sold to
Allergan as compared to $0.2 million of scrapped inventory and $0.1
million of costs associated with professional services during the
first quarter of 2020.
Research and development
expenses for the three months ended March 31, 2021
and 2020 were $2.2 million and $1.4 million, respectively. The
net increase of $0.8 million for the three months ended
March 31, 2021 as compared to the three months ended
March 31, 2020 was primarily due to increases in expanded
development costs of our product candidates partially offset by
$0.2 million in qualifying reimbursable expenses in connection with
the Department of Defense grant and increases in personnel related
expenses.
General and administrative
expenses for the three months ended March 31, 2021
and 2020 were $2.3 million and $1.2 million, respectively. The
$1.1 million increase for the three months ended March 31,
2021 as compared to the three months ended March 31, 2020 was
primarily due to incremental costs related to the transition from a
private to a public exchange traded entity, such as legal,
accounting and insurance fees and increases in personnel related
expenses.
Cash and cash equivalents as of
March 31, 2021 were $21.7 million. We believe that Histogen’s
existing cash and cash equivalents and cash inflow from operations
will be sufficient to meet its anticipated cash needs through the
second quarter of 2022.
Forward-Looking Statements
This press release contains forward-looking
statements within the meaning of the “safe harbor” provisions of
the Private Securities Litigation Reform Act of 1995 and other
Federal securities laws. For example, we are using forward-looking
statements when we discuss Histogen’s future operations and its
ability to successfully initiate and complete clinical trials,
obtain clinical trial data and achieve regulatory milestones and
related timing, including those related to the commencement of the
planned HST-003 Phase 1/2 clinical trial for regeneration of
cartilage in the knee, the completion and reporting of topline data
for the Phase 1 study of emricasan for the treatment of COVID-19
and the timing of providing guidance on the HST- 001 clinical
program targeting male androgenic alopecia; the nature, strategy
and focus of Histogen’s business; the sufficiency of Histogen’s
cash resources and its ability to achieve value for its
stockholders; the sufficiency of Amerimmune’s cash resources and
its ability to complete the Phase 1 study of emricasan and achieve
value for Histogen’s stockholders; and the development and
commercial potential and potential benefits of any of Histogen’s
product candidates, such as HST-001 and HST-003, and the
Collaborative Development and Commercialization Agreement with
Amerimmune and any other collaboration agreements. Histogen may not
actually achieve the plans, carry out the intentions or meet the
expectations or projections disclosed in the forward-looking
statements and you should not place undue reliance on these
forward-looking statements. Because such statements deal with
future events and are based on Histogen’s current expectations,
they are subject to various risks and uncertainties and actual
results, performance or achievements of Histogen that could differ
materially from those described in or implied by the statements in
this press release, including: the uncertainties associated with
the clinical development and regulatory approval of Histogen’s
product candidates, including potential delays in the commencement,
enrollment and completion of clinical trials, such as the planned
HST-003 Phase 1/2 clinical trial for regeneration of cartilage in
the knee and the reporting of guidance on the HST- 001 clinical
program targeting androgenic alopecia in men and Amerimmune’s
ability to further develop emricasan for the treatment of COVID-19,
including the complexity and length of studies required to
commercialize emricasan for COVID-19 and potential delays in the
completion of clinical trials, such as the emricasan Phase 1 study
for the treatment of COVID-19; Histogen’s dependence on its
collaboration partner, Amerimmune, to carry out the development of
emricasan and the potential for delays in the timing of regulatory
approval; competition in the COVID-19 market and other markets in
which Histogen and its collaboration partner operate; the potential
that earlier clinical trials and studies of Histogen’s product
candidates may not be predictive of future results; risks related
to business interruptions, including the outbreak of COVID-19
coronavirus, which could seriously harm Histogen’s financial
condition and increase its costs and expenses; and the requirement
for additional capital to continue to advance these product
candidates, which may not be available on favorable terms or at
all. The foregoing review of important factors that could cause
actual events to differ from expectations should not be construed
as exhaustive and should be read in conjunction with statements
that are included herein and elsewhere, including those risks
discussed in Histogen’s filings with the Securities and Exchange
Commission. Except as otherwise required by law, Histogen disclaims
any intention or obligation to update or revise any forward-looking
statements, which speak only as of the date hereof, whether as a
result of new information, future events, or circumstances or
otherwise.
HISTOGEN INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE
SHEETS(In thousands, except share and per share
amounts)
|
|
March 31,2021 |
|
|
December 31,2020 |
|
|
|
(unaudited) |
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
21,743 |
|
|
$ |
6,763 |
|
Restricted cash |
|
|
10 |
|
|
|
10 |
|
Accounts receivable, net |
|
|
188 |
|
|
|
144 |
|
Inventories |
|
|
61 |
|
|
|
300 |
|
Prepaid and other assets |
|
|
906 |
|
|
|
1,183 |
|
Total
current assets |
|
|
22,908 |
|
|
|
8,400 |
|
Property
and equipment, net |
|
|
248 |
|
|
|
271 |
|
Right-of-use assets |
|
|
4,491 |
|
|
|
4,411 |
|
Other
assets |
|
|
1,166 |
|
|
|
1,931 |
|
Total assets |
|
$ |
28,813 |
|
|
$ |
15,013 |
|
Liabilities and Stockholders’ Equity
(Deficit) |
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
496 |
|
|
$ |
539 |
|
Accrued liabilities |
|
|
1,148 |
|
|
|
1,880 |
|
Current portion of lease liabilities |
|
|
157 |
|
|
|
28 |
|
Payroll protection program loan, current |
|
|
156 |
|
|
|
97 |
|
Financed insurance premiums, current |
|
|
— |
|
|
|
193 |
|
Current portion of deferred revenue |
|
|
19 |
|
|
|
48 |
|
Total
current liabilities |
|
|
1,976 |
|
|
|
2,785 |
|
Payroll
protection program loan, non-current |
|
|
310 |
|
|
|
369 |
|
Lease
liabilities, non-current |
|
|
4,763 |
|
|
|
4,806 |
|
Noncurrent portion of deferred revenue |
|
|
113 |
|
|
|
118 |
|
Other
liabilities |
|
|
20 |
|
|
|
22 |
|
Total liabilities |
|
|
7,182 |
|
|
|
8,100 |
|
Commitments and contingencies (Note 10) |
|
|
|
|
|
|
|
|
Stockholders’ Equity (Deficit) |
|
|
|
|
|
|
|
|
Preferred stock, $0.0001 par value; 10,000,000 shares authorized at
March 31, 2021 and December 31, 2020; no shares issued and
outstanding at March 31, 2021 and December 31, 2020 |
|
|
— |
|
|
|
— |
|
Common
stock, $0.0001 par value; 200,000,000 shares authorized at March
31, 2021 and December 31, 2020; 35,744,457 and 15,030,757 shares
issued and outstanding at March 30, 2021 and December 31, 2020,
respectively |
|
|
4 |
|
|
|
1 |
|
Additional paid-in capital |
|
|
89,554 |
|
|
|
70,561 |
|
Accumulated deficit |
|
|
(66,972 |
) |
|
|
(62,702 |
) |
Total
Histogen Inc. stockholders’ equity (deficit) |
|
|
22,586 |
|
|
|
7,860 |
|
Noncontrolling interest |
|
|
(955 |
) |
|
|
(947 |
) |
Total
equity (deficit) |
|
|
21,631 |
|
|
|
6,913 |
|
Total liabilities and stockholders’ equity (deficit) |
|
$ |
28,813 |
|
|
$ |
15,013 |
|
HISTOGEN INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(In thousands, except share and per
share amounts)
|
|
Three Months Ended March 31, |
|
|
|
2021 |
|
|
2020 |
|
|
|
(unaudited) |
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
Product |
|
$ |
306 |
|
|
$ |
— |
|
Grant |
|
|
113 |
|
|
|
— |
|
License |
|
|
12 |
|
|
|
867 |
|
Professional services |
|
|
— |
|
|
|
111 |
|
Total revenues |
|
|
431 |
|
|
|
978 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
Cost of product revenue |
|
|
220 |
|
|
|
161 |
|
Cost of professional services revenue |
|
|
— |
|
|
|
97 |
|
Research and development |
|
|
2,153 |
|
|
|
1,391 |
|
General and administrative |
|
|
2,331 |
|
|
|
1,183 |
|
Total operating expenses |
|
|
4,704 |
|
|
|
2,832 |
|
Loss from operations |
|
|
(4,273 |
) |
|
|
(1,854 |
) |
Other income (expense): |
|
|
|
|
|
|
|
|
Interest income (expense), net |
|
|
(5 |
) |
|
|
— |
|
Total other income (expense) |
|
|
(5 |
) |
|
|
— |
|
Net loss |
|
|
(4,278 |
) |
|
|
(1,854 |
) |
Net loss attributable to noncontrolling interest |
|
|
8 |
|
|
|
10 |
|
Net loss attributable to
common stockholders |
|
$ |
(4,270 |
) |
|
$ |
(1,844 |
) |
|
|
|
|
|
|
|
|
|
Net loss per share available
to common stockholders, basic and diluted |
|
$ |
(0.14 |
) |
|
$ |
(0.55 |
) |
Weighted-average number of
common shares outstanding used to compute net loss per share,
basic and diluted |
|
|
31,571,676 |
|
|
|
3,343,357 |
|
CONTACT: Susan A. KnudsonExecutive Vice
President & CFO Histogen Inc. ir@histogen.com
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