AgeX Therapeutics reports net loss three months June, 2019 of $3.1 million

• Moves into new San Francisco Bay Area R&D facility, comprising approximately 15,700-square-feet of office and lab space, including cGMP-capable manufacturing suite.

• Strengthens leadership at Board level by appointment of regenerative medicine leader Dr. Michael H. May, CEO of Canada’s Centre for Commercialization of Regenerative Medicine (CCRM).

• Begins work using synthetic biology approach to engineer pluripotent stem cell lines with immune tolerance UniverCyte^™ technology to generate hypoimmunogenic (universal) cells.

• CEO Dr. Michael D. West featured in cover story Special Report in New Scientist magazine, “A Cure for Aging?”

ALAMEDA, Calif.–(BUSINESS WIRE)–AgeX Therapeutics, Inc. (“AgeX”; NYSE American: AGE), a biotechnology company focused on the development of therapeutics for human aging, reported financial and operating results for the second quarter ended June 30, 2019.

“In the second quarter we executed the complete relocation of our facilities including the construction of cGMP-capable therapeutics manufacturing space. We plan to utilize this new capability to produce clinical-grade master cell banks using our UniverCyte^™ technology, as well as AGEX-BAT1 and AGEX-VASC1 that may be used in the future in clinical trials,” said Michael D. West, Ph.D., founder and Chief Executive Officer. “In addition, we have prioritized the advancement of our induced Tissue Regeneration (iTR) technology which is increasingly recognized by the industry as a potentially transformative platform technology for the treatment of human aging. Our appointment of Dr. Michael May to our Board of Directors will contribute to attaining our goal of leading the industry in the field of the biotechnology of aging. Lastly, we appreciate the support of our largest shareholder Juvenescence, Limited that provided a $2 million loan facility demonstrating their continued support of our product development. We are fortunate to have Juvenescence, which itself has raised over $110 million since 2017, as our key backer.”

“This is an exceptionally exciting time for us as we work toward our goal of becoming a leading biotechnology company in cellular therapies and human aging,” commented Greg Bailey, M.D., Chairperson of the Board of Directors. “Our commitment to this goal is demonstrated by us taking up residence in our new R&D facility as well as making progress in our work to engineer hypoimmunogenic cells and to move our other programs forward.”

Additional Recent Highlights

• AgeX moved into a new San Francisco Bay Area R&D facility, comprising approximately 15,700-square-feet of office and lab space, located at 965 Atlantic Avenue Suite 101, Alameda, CA 94501. The new facility will house the company’s current staff and can accommodate for significant future growth. Good Manufacturing Practice (cGMP) production capability has been established at the new facility with two additional clean environmental space laboratories.
• Dr. West and AgeX featured in a cover story in New Scientist magazine. The influential British science magazine’s Special Report, “A Cure for Aging?” ran in the April 27^th issue.
• The Company participated at three industry and investor conferences during the quarter. These included a presentation by Dr. West at Undoing Aging in Berlin, Germany, on AgeX’s regenerative medicine product development. At the conference, Dr. West also presented data relating to the central molecular clockwork mechanisms that AgeX is targeting with its induced iTR program. Additionally, during the quarter the company presented at Master Investor Show 2019 in London and Biotech Investing in Longevity in San Francisco.
• AgeX entered into a Loan Facility Agreement with Juvenescence Limited, providing AgeX with a $2 million line of credit over the next 18 months to advance product development.

Balance Sheet Highlights

Cash, cash equivalents, and restricted cash totaled $5.9 million as of June 30, 2019, as compared with $8.6 million as of the end of the previous quarter.

Second Quarter 2019 Operating Results

Revenues: Total revenues for the three months ended June 30, 2019 were $380,000, as compared with $464,000 in the same period in 2018. AgeX revenues are primarily generated from subscription and advertising revenues from the GeneCards^® online database through its subsidiary LifeMap Sciences, Inc. 2019 revenues also included approximately $47,000 of allowable expenses under its research grant from the NIH. AgeX had no grant revenues in the same period in 2018.

Operating expenses: Operating expenses for the three months ended June 30, 2019 were $3.8 million, as compared with $2.5 million for the same period in 2018. On an as-adjusted basis, operating expenses for the three months ended June 30, 2019 were $3.0 million as compared to $2.2 million for the same period in 2018.

The reconciliation between operating expenses determined in accordance with accounting principles generally accepted in the United States (GAAP) and operating expenses, as adjusted, a non-GAAP measure, is provided in the financial tables included at the end of this press release.

Research and development expenses for the three months ended June 30, 2019 were $1.7 million, as compared with $1.4 million in the same period in 2018. The increase was primarily attributable to an increase in expenses in AgeX programs utilizing PureStem^® cell lines and iTR technology.

General and administrative expenses for the three months ended June 30, 2019 were $2.1 million, as compared with $1.1 million in the same period in 2018.

Net loss attributable to AgeX: The net loss attributable to AgeX for the three months ended June 30, 2019 was $3.1 million, or ($0.08) per share (basic and diluted) compared to $1.9 million, or ($0.06) per share (basic and diluted), for the same period in 2018.