-
Ends 2018 with triad of innovative cell therapy technologies:
UniverCyte™ for immune tolerance, PureStem® for cell
derivation and manufacturing, and HyStem® for cell delivery -
Potential to generate any human cell type with clinical and commercial
friendly characteristics of hypoimmunogenicity, low COGS and
availability off-the-shelf -
Juvenescence increased ownership by paying BioTime, Inc. $43.2M to
become largest shareholder -
Became public company with common stock traded on the NYSE American
under ticker “AGE” -
Board and management strengthened with seasoned professionals in
financing, R&D and cell therapies -
Secured almost $10M from sale of a non-core asset, equity financing
and NIH Grant
ALAMEDA, Calif.–(BUSINESS WIRE)–AgeX
Therapeutics, Inc. (“AgeX”: NYSE American: AGE), a biotechnology
company focused on developing and commercializing innovative cellular
and regenerative therapeutics for diseases of old age, reported
financial and operating results for the fourth quarter and year ended
December 31, 2018.
“2018 has been a transformative year for AgeX. We became a public
company, listed on the NYSE American, and made progress toward becoming
a leader in the cell therapy and longevity sectors,” said Michael D.
West, Ph.D., Chief Executive Officer. “One highlight was that we
acquired an immune tolerance technology, UniverCyte™, with the potential
to produce hypoimmunogenic cells for new therapies. Considering the
number of high-profile publications and deals in this space, we would
expect this platform to hold us in good stead for both our current
product development programs and the potential for third party
collaborations. We think this technology could help us deliver nearer
and longer term value to our stockholders.”
“AgeX has both exciting cell- and iTR™-based platforms. Using
UniverCyte™ in combination with our pluripotent stem cell-based PureStem®
cell derivation and manufacturing technology, we aim to generate
universal, off-the-shelf cells for therapeutic products with reduced
COGS,” said Greg Bailey, M.D., Chairman of the AgeX Board of Directors.
“Our goal is to overcome key industry barriers to successful development
and commercialization of cellular therapies, including immune rejection,
high manufacturing costs, and a service-based business model.”
Additional Recent Highlights
-
Secured
$5M strategic investment from Juvenescence in June 2018. -
Received approximately $3.2M from the sale of Ascendance
Biotechnology, a non-core asset. - Received $4.5M from the exercise of warrants in March 2019.
-
Secured $386,000 in non-dilutive funding in the form of a grant
award from the National Institutes of Health. -
Made progress in moving our preclinical cellular and iTR™ programs
forward, as reflected in part by our papers published in peer-reviewed
scientific journals: Stem Cell Research & Therapy, related
to our brown adipose tissue cell therapy program AGEX-BAT1 for
metabolic disorders such as Type II Diabetes and obesity, and Oncotarget,
identifying genes implicated in tissue regeneration and cancer, in
support of our iTR™ program -
Appointed seasoned biotech investor Gregory Bailey, M.D., as Chairman
of the Board. Dr. Bailey is the CEO of Juvenescence,
AgeX’s largest shareholder, and was an initial financier and board
member of Medivation, Inc. which went public and later was acquired by
Pfizer for $14.3Bn. -
Appointed experienced life science thought leader, Dr. Annalisa
Jenkins, to the Board. Dr. Jenkins previously served as President and
CEO of Dimension Therapeutics, a leading gene therapy company, and had
prior global R&D leadership roles at Merck Serono and Bristol
Myers-Squibb. -
Appointed John
F. Mauldin to the Board, a well-known financial writer, publisher,
and New York Times best-selling author. Mr. Mauldin appears regularly
on CNBC, Yahoo Tech Ticker, and Bloomberg TV. Mr. Mauldin serves as
Chairman of Mauldin Economics, an investment newsletter and
information publishing firm. -
Appointed Dr. Nafees Malik, a specialist in the strategy, execution
and commercialization of cell therapies as Chief Operating Officer.
Dr. Malik also serves as the Head of Cellular Therapy at Juvenescence.
His prior roles have spanned clinical medicine, healthcare investment
banking and biopharmaceutical companies.
Balance Sheet Highlights
Cash and cash equivalents totaled $6.7 million as of December 31, 2018.
AgeX strengthened its balance sheet by $4.5 million in proceeds from
warrant exercises in March 2019.
Fourth Quarter and Annual 2018 Operating Results
Revenues: Total Revenues for the fourth quarter of 2018 were $0.3
million as compared to $0.5 million in the comparable quarter in 2017.
Total revenues for the year ended 2018 were $1.4 million, relatively
unchanged as compared to 2017. AgeX revenues were primarily generated by
its subsidiary LifeMap Sciences, Inc. as subscription and advertising
revenues from its GeneCards® online database.
Operating expenses: Operating expenses for the three months ended
December 31, 2018, were $3.5 million, as reported, which was comprised
of $2.9 million for AgeX and $0.6 million for LifeMap Sciences, and were
$2.5 million, as adjusted, comprised of $2.0 million for AgeX and $0.5
million for LifeMap Sciences.
Operating expenses for 2018 were $12.3 million, as reported, which was
comprised of $10.0 million for AgeX and $2.3 million for LifeMap
Sciences, and were $9.5 million, as adjusted, comprised of $7.6 million
for AgeX and $1.9 million for LifeMap Sciences.
The reconciliation between GAAP and non-GAAP operating expenses is
provided in the financial tables included with this earnings release.
R&D Expenses: R&D expenses for the year ended December 31,
2018 were $6.6 million, compared to $5.8 million for 2017. The increase
was mainly attributable to an increase in our R&D spending in our
PureStem progenitor cell lines, brown adipose fat, iTR technology
programs and a nonrecurring expense of $800,000 to acquire certain
in-process R&D.
G&A Expenses: General and administrative expenses for the
three months ended December 31, 2018 increased by $1.3 million to $2.0
million as compared to $0.7 million in 2017. General and administrative
expenses for the year ended December 31, 2018 increased by $1.7 million
to $5.6 million as compared to $3.9 million in 2017. The increases were
mainly attributable to financial reporting, compliance, legal and other
expenses incurred in becoming a public company, and increase in non-cash
stock-based compensation expense due to increased stock option grants.
Other Income, net: We received approximately $3.2 million and
recognized a gain on sale of our ownership interest in Ascendance
Biotechnology, Inc. when that company was acquired by a third party in
2018.
About AgeX Therapeutics
AgeX Therapeutics, Inc. (NYSE American: AGE) is focused on developing
and commercializing innovative therapeutics for human aging. Its PureStem® and
UniverCyte™ manufacturing and immunotolerance technologies
are designed to work together to generate highly defined, universal,
allogeneic, off-the-shelf pluripotent stem cell-derived young cells of
any type for application in a variety of diseases with a high unmet
medical need. AgeX has two preclinical cell therapy programs: AGEX-VASC1
(vascular progenitor cells) for tissue ischemia and AGEX-BAT1 (brown fat
cells) for Type II diabetes. AgeX’s revolutionary longevity platform
induced Tissue Regeneration (iTR™) aims to unlock cellular immortality
and regenerative capacity to reverse age-related changes within tissues.
AGEX-iTR1547 is an iTR-based formulation in preclinical development.
HyStem® is AgeX’s delivery technology to stably engraft
PureStem cell therapies in the body. AgeX is developing its core product
pipeline for use in the clinic to extend human healthspan, and is
seeking opportunities to establish licensing and collaboration
arrangements around its broad IP estate and proprietary technology
platforms.
For more information, please visit www.agexinc.com
or connect with the company on Twitter,
Facebook,
and YouTube.
Forward-Looking Statements
Certain statements contained in this release are “forward-looking
statements” within the meaning of the Private Securities Litigation
Reform Act of 1995. 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 forward-looking statements. Forward-looking
statements involve risks and uncertainties. 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 business of AgeX Therapeutics, Inc. and
its subsidiaries, particularly those mentioned in the cautionary
statements found in more detail in the “Risk Factors” section of AgeX’s
Annual Report on Form 10-K filed with the Securities and Exchange
Commissions (copies of which may be obtained at www.sec.gov).
Subsequent events and developments may cause these forward-looking
statements to change. AgeX specifically disclaims any obligation or
intention to update or revise these forward-looking statements as a
result of changed events or circumstances that occur after the date of
this release, except as required by applicable law.
|
AGEX THERAPEUTICS, INC. AND SUBSIDIARIES |
||||||||
|
CONDENSED CONSOLIDATED BALANCE SHEETS |
||||||||
|
(IN THOUSANDS) |
||||||||
| December 31, | ||||||||
| 2018 | 2017 | |||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Cash and cash equivalents | $ | 6,707 | $ | 7,375 | ||||
| Accounts and grants receivable, net | 131 | 107 | ||||||
| Prepaid expenses and other current assets | 1,015 | 111 | ||||||
| Total current assets | 7,853 | 7,593 | ||||||
| Equipment and furniture, net | 90 | 129 | ||||||
| Deposits and other long-term assets | 19 | 35 | ||||||
| Intangible assets, net | 2,709 | 1,874 | ||||||
| TOTAL ASSETS | $ | 10,671 | $ | 9,631 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable and accrued liabilities | $ | 1,416 | $ | 768 | ||||
| Related party payables to BioTime and Juvenescence | 82 | 210 | ||||||
| Deferred revenues | 317 | 180 | ||||||
| Other current liabilities | 625 | 154 | ||||||
| TOTAL LIABILITIES | 2,440 | 1,312 | ||||||
|
Commitments and contingencies |
||||||||
| STOCKHOLDERS’ EQUITY | ||||||||
|
Preferred stock, $0.0001 par value, authorized 5,000 shares; none |
– | – | ||||||
|
Common shares, $0.0001 par value, 100,000 shares authorized; 35,830 and 33,750 shares issued and outstanding as of December 31, 2018 and 2017, respectively |
4 | 3 | ||||||
| Additional paid-in capital | 81,499 | 73,761 | ||||||
| Accumulated other comprehensive income (loss) | (2 | ) | 68 | |||||
| Accumulated deficit | (74,054 | ) | (66,552 | ) | ||||
| AgeX Therapeutics, Inc. stockholders’ equity | 7,447 | 7,280 | ||||||
| Noncontrolling interest | 784 | 1,039 | ||||||
| Total stockholders’ equity | 8,231 | 8,319 | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 10,671 | $ | 9,631 | ||||
| AGEX THERAPEUTICS, INC. AND SUBSIDIARIES | ||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
| (IN THOUSANDS, EXCEPT PER SHARE DATA) | ||||||||||||||||
| (UNAUDITED) | ||||||||||||||||
| Three Months Ended | Year Ended | |||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| REVENUES: | ||||||||||||||||
| Subscription and advertisement revenues | $ | 282 | $ | 455 | $ | 1,227 | $ | 1,399 | ||||||||
| Service and other revenues | 11 | 3 | 149 | 5 | ||||||||||||
| Grant revenues | 20 | – | 20 | – | ||||||||||||
| Total revenues | 313 | 458 | 1,396 | 1,404 | ||||||||||||
| Cost of sales | (180 | ) | (54 | ) | (364 | ) | (168 | ) | ||||||||
| Gross profit | 133 | 404 | 1,032 | 1,236 | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||||||
| Research and development | (1,523 | ) | (1,267 | ) | (5,830 | ) | (5,784 | ) | ||||||||
| Acquired in-proces research and development | – | – | (800 | ) | – | |||||||||||
| General and administrative | (1,968 | ) | (695 | ) | (5,647 | ) | (3,869 | ) | ||||||||
| Total operating expenses | (3,491 | ) | (1,962 | ) | (12,277 | ) | (9,653 | ) | ||||||||
| Gain on sale of assets | – | – | – | 1,754 | ||||||||||||
| Loss from operations | (3,358 | ) | (1,558 | ) | (11,245 | ) | (6,663 | ) | ||||||||
| OTHER INCOME/(EXPENSES): | ||||||||||||||||
| Interest income (expense), net | 32 | 16 | 116 | (12 | ) | |||||||||||
| Gain on sale of equity method investment in Ascendance | – | – | 3,215 | – | ||||||||||||
| Other income (expense), net | 52 | (2 | ) | 183 | 38 | |||||||||||
| Total other income, net | 84 | 14 | 3,514 | 26 | ||||||||||||
| NET LOSS | (3,274 | ) | (1,544 | ) | (7,731 | ) | (6,637 | ) | ||||||||
| Net loss attributable to noncontrolling interest | 88 | 37 | 229 | 57 | ||||||||||||
| NET LOSS ATTRIBUTABLE TO AGEX | $ | (3,186 | ) | $ | (1,507 | ) | $ | (7,502 | ) | $ | (6,580 | ) | ||||
| NET LOSS PER COMMON SHARE: BASIC AND DILUTED | $ | (0.09 | ) | $ | (0.04 | ) | $ | (0.21 | ) | $ | (0.21 | ) | ||||
|
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING: BASIC AND DILUTED |
35,830 | 33,750 | 34,914 | 30,644 | ||||||||||||
| AGEX THERAPEUTICS, INC. AND SUBSIDIARIES | ||||||||
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
|
(IN THOUSANDS) |
||||||||
| Year Ended December 31, | ||||||||
| 2018 | 2017 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net loss attributable to AgeX | $ | (7,502 | ) | $ | (6,580 | ) | ||
| Net loss attributable to noncontrolling interest | (229 | ) | (57 | ) | ||||
|
Adjustments to reconcile net loss attributable to AgeX to net cash used in operating activities: |
||||||||
| Gain on sale of equity method investment in Ascendance | (3,215 | ) |
– |
|||||
| Acquired in-process research and development | 800 |
– |
||||||
| Depreciation expense | 58 | 165 | ||||||
| Amortization of intangible assets | 477 | 517 | ||||||
| Amortization of deferred license fees | – | 17 | ||||||
| Gain on sale of assets | – | (1,754 | ) | |||||
| Stock-based compensation | 1,285 | 114 | ||||||
| Stock-based compensation allocated from BioTime | 184 | 411 | ||||||
| Subsidiary stock-based compensation | 4 | 227 | ||||||
| Bad debt expense | – | (121 | ) | |||||
| Foreign currency remeasurement (gain) and other | (68 | ) | – | |||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable and other receivables | (24 | ) | 322 | |||||
| Prepaid expenses and other current assets | (293 | ) | 10 | |||||
| Accounts payable and accrued liabilities | 648 | 267 | ||||||
| Related party payable to BioTime | (128 | ) | – | |||||
| Deferred revenues | 137 | (84 | ) | |||||
| Other | (129 | ) | 261 | |||||
| Net cash used in operating activities | (7,995 | ) | (6,285 | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Proceeds from the sale of equity method investment in Ascendance | 3,215 | – | ||||||
| Purchase of in-process research and development | (1,872 | ) | – | |||||
| Purchase of equipment and other assets | (21 | ) | (1 | ) | ||||
| Removal of cash upon deconsolidation of LifeMap Solutions | – | (3 | ) | |||||
| Security deposit received and other, net | 5 | 9 | ||||||
| Net cash provided by investing activities | 1,327 | 5 | ||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Contributions from BioTime | – | 1,971 | ||||||
| Advances from BioTime | – | 1,304 | ||||||
| Proceeds from sale of common shares | 5,000 | 10,000 | ||||||
| Proceeds from sale of warrants | 1,000 | – | ||||||
| Net cash provided by financing activities | 6,000 | 13,275 | ||||||
| Effect of exchange rate changes on cash and cash equivalents | – | 121 | ||||||
| NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | (668 | ) | 7,116 | |||||
| CASH AND CASH EQUIVALENTS: | ||||||||
| Beginning of year | 7,375 | 259 | ||||||
| End of year | $ | 6,707 | $ | 7,375 | ||||
Non-GAAP Financial Measures
This press release includes operating expenses prepared in accordance
with accounting principles generally accepted in the United States
(GAAP) and, includes operating expenses, by entity, prepared in
accordance with GAAP. This press release also includes certain
historical non-GAAP operating expenses and non-GAAP operating expenses,
by entity. In particular, AgeX Therapeutics, Inc. (“AgeX”) has provided
both (a) non-GAAP total operating expenses, adjusted to exclude noncash
stock-based compensation expense, depreciation and amortization expense,
and acquired in-process research and development expense, a nonrecurring
item, and (b) non-GAAP operating expenses, by entity, to exclude those
same charges by the respective entities for consistency. Non-GAAP
financial measures are not meant to be considered in isolation or as a
substitute for comparable financial measures prepared in accordance with
GAAP. However, AgeX believes the presentation of non-GAAP total
operating expenses and non-GAAP operating expenses, by entity, when
viewed in conjunction with our GAAP total operating expenses, and GAAP
operating expenses by entity, respectively, is helpful in understanding
AgeX’s ongoing operating expenses and its programs and those of certain
subsidiaries.
Furthermore, management uses these non-GAAP financial measures in the
aggregate and on an entity basis to establish budgets and operational
goals, to manage AgeX’s business and to evaluate its performance and its
programs in clinical development.
|
AGEX THERAPEUTICS, INC. AND SUBSIDIARIES |
||||||||
|
RECONCILIATION OF NON-GAAP FINANCIAL MEASURE |
||||||||
|
ADJUSTED OPERATING EXPENSES |
||||||||
|
|
Amounts In Thousands | |||||||
|
For the Three Months Ended |
For the Year Ended |
|||||||
| GAAP Operating Expenses – as reported | $ | 3,491 | $ | 12,277 | ||||
| Stock-based compensation expense (1) | (797 | ) | (1,473 | ) | ||||
| Depreciation and amortization expense (1) | (150 | ) | (535 | ) | ||||
| Acquired in-process research and development expense (2) | – | (800 | ) | |||||
| Non-GAAP Operating Expenses, as adjusted | $ | 2,544 | $ | 9,469 | ||||
| GAAP Operating Expenses – by entity | ||||||||
| AgeX and subsidiaries other than LifeMap Sciences (3) | $ | 2,897 | $ | 9,946 | ||||
| LifeMap Sciences, Inc. and subsidiary (4) | 594 | 2,331 | ||||||
| GAAP Operating Expenses – by entity | $ | 3,491 | $ | 12,277 | ||||
| Non-GAAP Operating Expenses – as adjusted, by entity | ||||||||
| AgeX and subsidiaries other than LifeMap Sciences | $ | 2,066 | $ | 7,589 | ||||
| LifeMap Sciences, Inc. and subsidiary | 478 | 1,880 | ||||||
| Non-GAAP Operating Expenses – as adjusted, by entity | $ | 2,544 | $ | 9,469 | ||||
| (1) | Noncash charges | |
| (2) |
AgeX acquired certain in-process research and development in March 2018, considered to be a nonrecurring item. |
|
| (3) |
AgeX Therapeutics, Inc. includes ReCyte Therapeutics, Inc., a majority-owned and consolidated subsidiary. |
|
| (4) |
LifeMap Sciences Inc. includes LifeMap Sciences Ltd., both consolidated subsidiaries of AgeX Therapeutics, Inc. |
|
Contacts
Media Contact for AgeX:
Bill
Douglass
Gotham
Communications, LLC
bill@gothamcomm.com
(646)
504-0890