Asterias Biotherapeutics Reports Second Quarter Results

Conference Call and Webcast Today, August 10, at 4:30 p.m. ET

Aug 10, 2015, 16:01 ET from Asterias Biotherapeutics, Inc.

MENLO PARK, Calif., Aug. 10, 2015 /PRNewswire/ -- Asterias Biotherapeutics, Inc. (NYSE MKT: AST), a leading biotechnology company in the emerging field of regenerative medicine, today reported financial and operating results for the second quarter ended June 30, 2015.

"In the second quarter, we continued to make progress on multiple fronts toward advancing the clinical development of our key therapeutic programs," stated Pedro Lichtinger, President and CEO of Asterias. "We presented new, long-term follow-up Phase 2 clinical data of AST-VAC1 in acute myelogenous leukemia, the most common form of acute leukemia in adults, which showed potential for prolonged relapse-free survival in the overall study population, as well as in the sub-population of adults 60 years and older for which there remains a major unmet need. Based on the promising clinical data observed with AST-VAC1, we are pursuing opportunities to fund a focused clinical development plan for potential commercialization of AST-VAC1 through partnerships or non-dilutive funding."

Mr. Lichtinger continued, "In addition, we dosed the first patient in our Phase 1/2a clinical trial of AST-OPC1 for complete cervical spinal cord injury, a trial which is designed to evaluate the product at the doses and in the population where it has the maximum potential to bring benefit to patients. Importantly, we were successful in our efforts to further strengthen our balance sheet during the quarter by increasing our cash position by approximately $8 million, which has enhanced our financial flexibility to continue to execute our strategic plan through mid-2016. At the same time, during the quarter we completed some administrative tasks, namely the registration of all unregistered Asterias outstanding shares, including those shares held by our parent company BioTime. BioTime remains our largest shareholder and it is important to note that BioTime has not sold any of its position in Asterias since the June 10, 2015 effective date of the registration statement."

Recent Research and Development Highlights:

AST-VAC1 (antigen-presenting autologous dendritic cells)

  • Positive, new, long-term follow-up data from a Phase 2 clinical trial of AST-VAC1, the Company's autologous telomerase-based dendritic cell cancer vaccine, in patients with intermediate and high risk acute myelogenous leukemia (AML) was presented at the 2015 American Society of Clinical Oncology (ASCO) Annual Meeting in June. The long-term follow-up showed that 57% of patients who received AST-VAC1 had prolonged relapse-free survival, even patients with high-risk AML including those over 60 years old and patients in second remission.
  • Asterias is in the process of establishing its clinical development plan for potential commercialization of AST-VAC1. The next step is planned to be a larger Phase 2/3 clinical trial designed to validate the positive findings from the completed Phase 2 study. Concurrently, the Company has commenced evaluation of strategic alternatives to further advance clinical development either independently or with a partner, and maximize the value of AST-VAC1.

AST-OPC1 (oligodendrocyte progenitor cells)

  • In June, the first patient was successfully dosed at the Atlanta-based Shepherd Center in a Phase 1/2a clinical trial evaluating activity of escalating doses of AST-OPC1 in newly injured patients with sensory and motor complete cervical spinal cord injury (SCI). The Phase 1/2a trial, to be conducted in eight to ten centers in the United States, is part of the planned registration program for AST-OPC1, with neurologically complete cervical SCI as the first targeted indication. The open-label, single-arm study will test three sequential escalating doses of AST-OPC1 administered at up to 20 million AST-OPC1 cells in 13 patients with sub-acute, C-5 to C-7, neurologically complete cervical SCI. These individuals have essentially lost all sensation and movement below their injury site with severe paralysis of the upper and lower limbs. AST-OPC1 will be administered 14 to 30 days post-injury. Patients will be followed by neurological exams and imaging methods to assess the safety and activity of the product. The Company expects availability of safety data from the first patient cohort in the Phase 1/2a trial during the second half of 2015, and initial efficacy data readouts from the trial in the second half of 2016.
  • If initial safety data from the 10 million cell cohort is positive, Asterias plans to file an Investigational New Drug Application (IND) amendment with the U.S. Food and Drug Administration (FDA) to expand enrollment in the study to include up to 40 patients with an adaptive design. An adaptive design clinical study is a study that includes a prospectively planned opportunity for modification of one or more specified aspects of the study design and hypotheses based on analysis of data from subjects in the study. The Company believes this flexible methodology can increase the chance to demonstrate the superiority of AST-OPC1 by increasing the statistical confidence of the safety and efficacy readouts, and position the product for potential accelerated regulatory approvals.
  • In the second quarter, Asterias received $1.1 million from the California Institute of Regenerative Medicine (CIRM) under the previously announced $14.3 million CIRM grant award for clinical development of AST-OPC1. CIRM disburses the grant funds in accordance with a quarterly disbursement schedule, subject to Asterias' achievement of certain progress and safety milestones.

AST-VAC2 (antigen-presenting allogeneic dendritic cells)

  • Asterias is nearing completion of transfer of the cGMP-compatible AST-VAC2 process to development partner Cancer Research UK (CRUK). Confirmatory runs are in progress at both Asterias and CRUK, with completion of the full transfer expected in the fourth quarter of 2015. Following completion of the technology transfer, CRUK will, at its own cost, manufacture clinical grade AST-VAC2 and conduct the Phase 1/2a clinical trial in patients with non-small cell lung cancer in the UK, subject to regulatory approval. Asterias continues to expect potential regulatory clearance to begin treating patients as part of the Phase 1/2a trial in the second half of 2016.

Other Corporate Developments:

  • In May, Edward D. Wirth, III, M.D., Ph.D., was promoted to the newly created role of Chief Medical Officer. Dr. Wirth was Chief Translational Officer since joining Asterias in March 2013. In his new role, Dr. Wirth serves as an executive officer of the Company and provides strategic leadership for Asterias' clinical development activities including its therapeutic programs, AST-OPC1 for spinal cord injuries, AST-VAC1 for AML and AST-VAC2 for lung cancer.
  • At the same time, Jane Lebkowski, President Research and Development was named as President of R&D and Chief Scientific Officer. Dr Lebkowski has been in the field and cell and gene therapy for 29 years and an employee of Asterias since March 2013. Dr Lebkowski is responsible for all research, product and regulatory development of Asterias products.
  • In May, Asterias received total proceeds of $11.7 million resulting from the exercise of all outstanding common share purchase warrants originally issued in June 2014. The proceeds will be used to further advance the Company's development programs.
  • In June, Asterias was added to the Russell 2000®, Russell 3000®, Russell Global and Russell Microcap® indexes following Russell Investments' (Russell) reconstitution of its comprehensive set of U.S. and global equity indexes. Each June, Russell completely rebalances its indexes, known as a reconstitution, to reflect market changes in the past year. The Russell indexes are widely used by investment managers and institutional investors for index funds and as benchmarks for passive and active investment strategies.

Second Quarter [Unaudited] Financial Results

Total revenues in the second quarter 2015 were $772,000, which were primarily comprised of grant income and royalty revenues on product sales by licensees. Total revenues in the year ago quarter were $21,000. Operating expenses in the second quarter were $5.5 million, compared to $4.3 million in the prior year period. Research and development (R&D) expenses in the second quarter were $3.7 million, compared to $2.7 million in the year ago quarter. General and administrative (G&A) expenses in the second quarter were $1.8 million, compared to $1.5 million in the year ago quarter.

Net loss for the second quarter 2015 was $3.6 million, including a deferred income tax benefit of approximately $1.2 million. Net loss in the second quarter 2014 was $2.8 million, including a deferred income tax benefit of approximately $1.5 million. On a per share basis, net loss for the second quarter was $0.10 per share, compared to a loss of $0.09 per share for the year ago quarter.

Cash and cash equivalents were $15.6 million as of June 30, 2015, compared to $3.1 million as of December 31, 2014. In May 2015, Asterias received total proceeds of $11.7 million resulting from the exercise of all outstanding common share purchase warrants originally issued in June 2014. In addition, Asterias raised approximately $2.8 million in gross proceeds through the Company's at-the-market (ATM) equity offering program during the second quarter of 2015. At June 30, 2015, the Company held 3.9 million BioTime common shares, with a market value of approximately $14.0 million on that date. For the second quarter, net cash used in operating activities was $4.7 million. The Company continues to expect net cash burn in 2015 to be in the range of $15 million to $17 million.

Second Quarter Conference Call and Webcast Details

The Company will host a conference call and webcast today, Monday, August 10, 2015, at 4:30 p.m. Eastern / 1:30 p.m. Pacific to discuss the results and recent corporate developments.

For both "listen-only" participants and those participants who wish to participate in the question-and-answer portion of the call, the dial-in number in the U.S./Canada is 888-389-5988. For participants outside the U.S./Canada, the dial-in number is 719-457-2648. For all callers, refer to Conference ID 3175112. To access the live webcast, go to http://asteriasbiotherapeutics.com/events-presentations/.

A replay of the conference call will be available for seven business days beginning about two hours after the conclusion of the live call, by calling toll-free (from U.S./Canada) 888-203-1112; international callers dial 719-457-0820. Use the Conference ID 3175112. Additionally, the archived webcast will be available at http://asteriasbiotherapeutics.com/events-presentations/.  

About Asterias Biotherapeutics

Asterias Biotherapeutics, Inc. (NYSE MKT: AST) is a leading biotechnology company in the emerging field of regenerative medicine. The Company's proprietary, industry leading platforms are based on its pluripotent stem cell and allogeneic dendritic cell technologies. Pluripotent stem cells are characterized by the ability to become all cell types in the human body. Asterias is focused on developing therapies based on pluripotent stem cells to treat conditions in several medical areas where there is high unmet medical need and inadequate available therapies. AST-OPC1 (oligodendrocyte progenitor cells) is currently in a Phase 1/2a dose escalation clinical trial in spinal cord injury. AST-VAC1 (antigen-presenting autologous dendritic cells) has demonstrated promise in a Phase 2 study in acute myelogenous leukemia. AST-VAC2 (antigen-presenting allogeneic dendritic cells) represents a second generation, allogeneic approach to dendritic cell vaccines. Additional information about Asterias can be found at www.asteriasbiotherapeutics.com.

FORWARD-LOOKING STATEMENTS

Statements pertaining to future financial and/or operating results, future growth in research, technology, clinical development, and potential opportunities for Asterias, along with other statements about the future expectations, beliefs, goals, plans, or prospects expressed by management constitute forward-looking statements. Any statements that are not historical fact (including, but not limited to statements that contain words such as "will," "believes," "plans," "anticipates," "expects," "estimates") should also be considered to be forward-looking statements. Forward-looking statements involve risks and uncertainties, including, without limitation, risks inherent in the development and/or commercialization of potential products, uncertainty in the results of clinical trials or regulatory approvals, need and ability to obtain future capital, and maintenance of intellectual property rights. Actual results may differ materially from the results anticipated in these forward-looking statements and as such should be evaluated together with the many uncertainties that affect the businesses of Asterias, particularly those mentioned in the cautionary statements found in Asterias' filings with the Securities and Exchange Commission. Asterias disclaims any intent or obligation to update these forward-looking statements.

 


ASTERIAS BIOTHERAPEUTICS, INC.

CONDENSED STATEMENTS OF OPERATIONS

(IN THOUSANDS, EXCEPT PER SHARE DATA)

(UNAUDITED)




Three months ended June 30,


Six months ended June 30,



2015


2014


2015


2014

REVENUE













  Royalties from product sales


$

73


$

21


$

175


$

83

  Sale of cell lines



40



-



40



-

  Grant income



659



-



1,337



-

  Total revenues



772



21



1,552



83

  Cost of sales



(38)



(41)



(88)



(41)

  Total gross profit


$

734


$

(20)


$

1,464


$

42














EXPENSES













Research and development


$

(3,696)


$

(2,743)


$

(7,289)


$

(5,342)

General and administrative



(1,845)



(1,545)



(3,517)



(2,639)

Total operating expenses



(5,541)



(4,288)



(10,806)



(7,981)














Loss from operations



(4,807)



(4,308)



(9,342)



(7,939)














OTHER EXPENSE













 Interest expense, net



(51)



(5)



(71)



(10)

Other expense, net



(1)



(2)



(2)



(2)

Total other expenses



(52)



(7)



(73)



(12)














LOSS BEFORE DEFERRED INCOME TAX BENEFIT



(4,859)



(4,315)



(9,415)



(7,951)














Deferred income tax benefit



1,241



1,513



2,825



2,862














NET LOSS



(3,618)



(2,802)



(6,590)



(5,089)














Available for sales investments:
Change in other unrealized gain/(loss), net of taxes



(3,356)



-



(250)



(454)














COMPREHENSIVE LOSS


$

(6,974)


$

(2,802)


$

(6,840)


$

(5,543)














Basic and diluted net loss per common share


$

(0.10)


$

(0.09)


$

(0.20)


$

(0.17)














Weighted average common shares outstanding used to compute net loss per common share, basic and diluted



34,590



30,576



33,138



30,537














 

ASTERIAS BIOTHERAPEUTICS, INC.

BALANCE SHEETS

(IN THOUSANDS, EXCEPT PAR VALUE AMOUNTS)




June 30, 2015   (unaudited)


December 31, 2014

ASSETS





CURRENT ASSETS





Cash and cash equivalents


$

15,636


$

3,076

Available-for-sale securities, at fair value



13,990



14,374

Grant receivable



-



118

Landlord receivable



2,771



378

Prepaid expenses and other current assets



627



438

Total current assets



33,024



18,384








NONCURRENT ASSETS







Intangible assets, net



22,159



23,502

Equipment and furniture, net



940



1,045

Construction in progress



3,416



406

Investment in affiliates



416



416

Other assets



361



361

Total noncurrent assets



27,292



25,730

TOTAL ASSETS


$

60,316


$

44,114








LIABILITIES AND STOCKHOLDERS' EQUITY







CURRENT LIABILITIES







Amount due to parent, BioTime, Inc.


$

166


$

615

Accounts payable



1,389



737

Accrued liabilities and other current liabilities



580



430

Deferred grant income



1,877



2

Deferred tax liabilities, current portion



4,578



4,713

Total current liabilities



8,590



6,497








LONG-TERM LIABILITIES







Deferred tax liabilities, net of current portion and deferred tax assets



1,690



4,514

Deferred rent liability, net of current portion



36



94

Lease liability



3,331



379

TOTAL LIABILITIES



13,647



11,484








Commitments and contingencies (see Note 8)














STOCKHOLDERS' EQUITY







Preferred Stock, $0.0001 par value, authorized 5,000,000 shares; none issued and  outstanding



-



-

Common Stock, authorized 75,000,000 Series A Common Stock, $0.0001 par value, and 75,000,000 Series B Common Stock, $0.0001 par value; 37,602,180 and 30,902,152 shares Series A Common Stock issued and outstanding at June 30, 2015 and December 31, 2014, respectively, no Series B Common Stock issued and outstanding at June 30, 2015 and December 31, 2014



4



3

Additional paid-in capital



87,243



66,366

Accumulated comprehensive loss on available-for-sale investments



(752)



(503)

Deficit accumulated during the development stage



(39,826)



(33,236)

Total stockholders' equity



46,669



32,630

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY


$

60,316


$

44,114








 

SOURCE Asterias Biotherapeutics, Inc.



RELATED LINKS

http://www.asteriasbiotherapeutics.com