Histogen Inc. (NASDAQ: HSTO), a clinical-stage therapeutics company
focused on developing both restorative therapeutics for orthopedic
indications and pan-caspase and caspase selective inhibitors
focused on treatments for infectious and inflammatory diseases,
today reported financial results for the third quarter ended
September 30, 2022 and provided an update on its clinical pipeline
and other corporate developments.
“We remain focused on the feasibility of
developing emricasan as a potential treatment for bacterial skin
infections including those related to methicillin resistant
staphylococcus aureus (“MRSA”) and evaluating our caspase-1
inhibitors that impact the inflammasome pathway,” said Steven J.
Mento, Ph.D., Interim President and Chief Executive Officer. “We
also continue to make progress on the ongoing feasibility
evaluation of our HST 003 study for cartilage regeneration in the
knee, including implementation of protocol modifications, and other
study resources given the continued recruitment challenges and
expect to complete our evaluation in the fourth quarter of
2022.”
Highlights from the Third Quarter 2022 and
Business Updates
- HST 003 – Our
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 is on-going. Our feasibility assessment for the HST 003
study continues to progress, and despite adding three additional
clinical sites in the first quarter of 2022, and implementing
protocol modifications in the third quarter of 2022, our
recruitment challenges remain unresolved due to both the overall
nature of the study and the impact of COVID-19 on the elective
surgery environment. We expect to complete our feasibility
evaluation in the fourth quarter of 2022.
- HST 004 – Is a CCM
solution intended to be administered through an intradiscal
injection for spinal disc repair. In the second quarter of 2021, we
initiated IND enabling activities for HST-004. However, due to
pipeline program prioritization, we have made the decision to
suspend all IND enabling activities for the HST-004 program.
- Emricasan MRSA -
We continue to make progress on the feasibility of developing
emricasan as a potential treatment for bacterial skin infections
including those related to MRSA including testing emricasan in
animal studies for MRSA. We expect to complete our feasibility
assessment in the fourth quarter of 2022.
Nine Months Ended September 30, 2022
Financial Highlights
Product, License, and Grant
Revenues
For the nine months ended September 30,
2022 and 2021, we recognized product revenues of $0 and $0.9
million, respectively. The revenue for the first nine months of
2021 was due to a one-time unanticipated sale of CCM to Allergan,
unrelated to the Allergan Agreements. As of March 31, 2021, all
obligations of the Company related to the additional supply of CCM
to Allergan under the Allergan Agreements have been completed.
For the nine months ended September 30,
2022 and 2021, we recognized license revenue of $3.8 million and
$22 thousand, respectively. The increase in the current period is
due to a one-time payment of $3.75 million received in March 2022
as consideration for execution of the Allergan Letter
Agreement.
For the nine months ended September 30,
2022 and 2021, we recognized grant revenue of $0 and $0.1 million,
respectively. The related revenue is associated with a research and
development grant awarded to the Company from the NSF. As of March
31, 2021, all work required by the Company under the grant has been
completed.
Cost of revenues - for the nine
months ended September 30, 2022 and 2021, we recognized $0 and
$0.2 million, respectively, for cost of product sold to Allergan
under the Allergan Agreements.
Research and development
expenses - research and development expenses for the nine
months ended September 30, 2022 and 2021 were $3.9 million and
$6.9 million, respectively. The decrease of $3.0 million was
primarily due to decreases in development costs of our clinical and
pre-clinical product candidates, outside services, and personnel
related expenses, partially offset by facility rent increases.
General and administrative
expenses - general and administrative expenses for the
nine months ended September 30, 2022 and 2021 were $7.5
million and $6.3 million, respectively. The increase of $1.2
million was primarily due to increases in royalty expenses, legal
fees, outside services and rent expenses, offset by reductions in
insurance and other administrative expenses.
Cash and cash equivalents - as
of September 30, 2022, we had $14.6 million in cash and cash
equivalents. Histogen believes that its existing cash and cash
equivalents and cash inflow from operations will be sufficient to
meet Histogen’s anticipated cash needs through December of
2023.
About Histogen Inc.
Histogen Inc. is a clinical-stage therapeutics
company focused on developing both potential first-in-class
restorative therapeutics that ignite the body’s natural process to
repair and maintain healthy biological function as well as a
pipeline of clinical and preclinical small molecule pan-caspase and
caspase selective inhibitors focused on treatments for infectious
and inflammatory diseases. Under our biologics technology platform,
our product candidates in development are HST-003, a treatment for
joint cartilage repair, and HST-004, a treatment for spinal disc
repair. In addition, within our small molecule pipeline, our
product candidates include emricasan, CTS-2090 and CTS-2096.
Currently, emricasan is being developed jointly with our
collaboration partner, Amerimmune, for the treatment of COVID-19,
and we are evaluating the use of emricasan for bacterial skin
infections including those related to MRSA, as well as other
infectious diseases. We also have preclinical product candidates,
CTS-2090 and CTS-2096, novel, potent, orally bioavailable, and
highly selective small molecule inhibitors of caspase-1 designed
for the treatment of certain inflammatory diseases. For more
information, please visit www.histogen.com.
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 our future operations and our ability to
successfully initiate, enroll and complete clinical trials, obtain
clinical trial data and achieve regulatory milestones and related
timing, including those related to the initiation, completion and
reporting of top line results for HST-003 Phase 1/2 clinical trial
for regeneration of cartilage in the knee, the completion of IND
enabling activities and the anticipated filing of the HST-004 IND
for spinal disc repair and the timing of providing clinical
development guidance on the emricasan and any further evaluation of
CTS-2090 and CTS-2096. We 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 our
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: our
ability to obtain funding for our operations, including funding
necessary to complete further development and any commercialization
of our product candidates; our expectations regarding the
arbitration proceedings related to emricasan and the joint
development with Amerimmune for COVID-19 and other infectious and
inflammatory diseases, including its ability to carry out the
development of emricasan and the potential for delays in the timing
of regulatory approval and the requirement for additional capital
to continue to advance these product candidates, which may not be
available on favorable terms or at all; our expectations regarding
the operation of our product candidates, collaborations and related
benefits; our beliefs regarding the success, cost and timing of our
product candidate development and collaboration activities and
current and future clinical trials and studies; our beliefs
regarding the potential markets for our product candidates,
collaborations and our collaborators’ ability to serve those
markets; any impact of the COVID-19 pandemic, or
responses to the pandemic, on our business, collaborations,
clinical trials or personnel; our beliefs regarding our
industry; our ability to attract and retain key
personnel; regulatory developments in the United States and foreign
countries, with respect to our product candidates; the expected
impact of any arbitration and litigation proceedings on our
business, cash resources and the time required by management to
address such proceedings; the impact of any arbitration and
litigation proceedings on our business and market and other
conditions. 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 our 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 SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS (in
thousands, except share and per share amounts)
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
|
|
|
|
|
|
|
|
|
|
|
Product revenue |
|
$ |
— |
|
|
$ |
586 |
|
|
$ |
— |
|
|
$ |
892 |
|
License revenue |
|
|
5 |
|
|
|
5 |
|
|
|
3,765 |
|
|
|
22 |
|
Grant revenue |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
113 |
|
Total revenue |
|
|
5 |
|
|
|
591 |
|
|
|
3,765 |
|
|
|
1,027 |
|
Operating expense |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of product revenue |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
220 |
|
Research and development |
|
|
907 |
|
|
|
2,338 |
|
|
|
3,932 |
|
|
|
6,866 |
|
General and administrative |
|
|
2,696 |
|
|
|
2,110 |
|
|
|
7,508 |
|
|
|
6,264 |
|
Total operating expense |
|
|
3,603 |
|
|
|
4,448 |
|
|
|
11,440 |
|
|
|
13,350 |
|
Loss from
operations |
|
|
(3,598 |
) |
|
|
(3,857 |
) |
|
|
(7,675 |
) |
|
|
(12,323 |
) |
Other income
(expense) |
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
|
(1 |
) |
|
|
(2 |
) |
|
|
(2 |
) |
|
|
(9 |
) |
Other Income |
|
|
— |
|
|
|
1 |
|
|
|
— |
|
|
|
476 |
|
Net
loss |
|
|
(3,599 |
) |
|
|
(3,858 |
) |
|
|
(7,677 |
) |
|
|
(11,856 |
) |
Loss attributable to noncontrolling interest |
|
|
3 |
|
|
|
17 |
|
|
|
20 |
|
|
|
41 |
|
Deemed dividend - accretion of discount and redemption feature of
redeemable convertible preferred stock |
|
|
— |
|
|
|
— |
|
|
|
(488 |
) |
|
|
— |
|
Net loss
available to common stockholders |
|
$ |
(3,596 |
) |
|
$ |
(3,841 |
) |
|
$ |
(8,145 |
) |
|
$ |
(11,815 |
) |
Net loss per
share available to common stockholders, basic and diluted |
|
$ |
(1.01 |
) |
|
$ |
(1.84 |
) |
|
$ |
(2.85 |
) |
|
$ |
(6.41 |
) |
Weighted-average number of common shares outstanding used to
compute net loss per share, basic and diluted |
|
|
3,554,623 |
|
|
|
2,086,403 |
|
|
|
2,853,713 |
|
|
|
1,843,426 |
|
|
|
|
|
HISTOGEN INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (in
thousands, except share and per share amounts)
|
|
September 30,2022 |
|
|
December 31,2021 |
|
|
|
(unaudited) |
|
|
|
|
Assets |
|
|
|
|
|
|
Current
assets |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
14,552 |
|
|
$ |
18,685 |
|
Restricted cash |
|
|
400 |
|
|
|
400 |
|
Accounts receivable, net |
|
|
74 |
|
|
|
165 |
|
Prepaid and other current assets |
|
|
1,312 |
|
|
|
2,359 |
|
Total current assets |
|
|
16,338 |
|
|
|
21,609 |
|
Property and
equipment, net |
|
|
473 |
|
|
|
399 |
|
Right-of-use
asset |
|
|
4,738 |
|
|
|
4,432 |
|
Other
assets |
|
|
638 |
|
|
|
805 |
|
Total assets |
|
$ |
22,187 |
|
|
$ |
27,245 |
|
Liabilities and stockholders’ equity |
|
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
|
Accounts payable |
|
$ |
561 |
|
|
$ |
1,393 |
|
Accrued liabilities |
|
|
593 |
|
|
|
791 |
|
Current portion of lease liabilities |
|
|
225 |
|
|
|
127 |
|
Current portion of deferred revenue |
|
|
19 |
|
|
|
19 |
|
Total current liabilities |
|
|
1,398 |
|
|
|
2,330 |
|
Lease
liabilities, non-current |
|
|
4,443 |
|
|
|
4,617 |
|
Noncurrent
portion of deferred revenue |
|
|
84 |
|
|
|
98 |
|
Finance
lease liability, non-current |
|
|
8 |
|
|
|
14 |
|
Total liabilities |
|
|
5,933 |
|
|
|
7,059 |
|
Commitments
and contingencies (Note 8) |
|
|
|
|
|
|
Stockholders' Equity |
|
|
|
|
|
|
Preferred
stock, $0.0001 par value; 10,000,000 shares authorized at September
30, 2022 and December 31, 2021; no shares issued and outstanding at
September 30, 2022 and December 31, 2021 |
|
|
— |
|
|
|
— |
|
Common
stock, $0.0001 par value; 200,000,000 shares authorized at
September 30, 2022 and December 31, 2021; 4,271,759 and 2,497,450
shares issued and outstanding at September 30, 2022 and December
31, 2021, respectively |
|
|
5 |
|
|
|
5 |
|
Additional paid-in capital |
|
|
102,584 |
|
|
|
98,839 |
|
Accumulated deficit |
|
|
(85,309 |
) |
|
|
(77,652 |
) |
Total Histogen Inc. stockholders’ equity |
|
|
17,280 |
|
|
|
21,192 |
|
Noncontrolling interest |
|
|
(1,026 |
) |
|
|
(1,006 |
) |
Total equity |
|
|
16,254 |
|
|
|
20,186 |
|
Total
liabilities and stockholders’ equity |
|
$ |
22,187 |
|
|
$ |
27,245 |
|
|
|
|
|
CONTACT:
Susan A. KnudsonExecutive Vice President &
CFO Histogen Inc.ir@histogen.com
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