Lineage Cell Therapeutics Reports First Quarter 2020 Financial Results and Provides Business Update

On May 7, 2020 Lineage Cell Therapeutics, Inc. (NYSE American and TASE: LCTX), a clinical-stage biotechnology company developing novel cell therapies for unmet medical needs, reported financial and operating results for the first quarter ended March 31, 2020 (Press release, Lineage Cell Therapeutics, MAY 7, 2020, View Source [SID1234557267]). Lineage management will host a conference call today at 4:30 p.m. Eastern Time/1:30 p.m. Pacific Time to discuss its first quarter 2020 financial and operating results and to provide a business update.

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"Lineage has adapted quickly to an unprecedented business environment. We ensured the safety of our teams while maintaining the continuity of our global operations and advancing our programs with meaningful clinical data and contractual arrangements," stated Brian M. Culley, Lineage CEO. "Looking ahead, we believe we are well positioned to achieve many of our 2020 objectives. Most notably, a clinical update recently presented at the ARVO meeting provided a more comprehensive picture of treatment with OpRegen, where certain patients were able to see better, have less growth to their area of geographic atrophy, and read faster, representing important enhancements to vision and quality of life metrics. We also are excited about exercising our option to regain control of the VAC platform for immuno-oncology and expand it to the development of a vaccine for coronaviruses such as SARS-CoV-2, the virus which causes COVID-19."

2020 Plans and Objectives:

– Present new OpRegen data from the ongoing Phase 1/2a clinical trial as available throughout the year.

– Complete patient enrollment in the U.S. with the Gyroscope Orbit SDS and new thaw-and-inject formulation in the ongoing Phase 1/2a clinical trial of OpRegen for the treatment of dry AMD.

– Meet with the U.S. Food and Drug Administration (FDA) to discuss the further clinical development of OpRegen.

– Evaluate partnership opportunities for the OpRegen program and other development assets.

– Report VAC2 clinical data from the initial patients treated in the ongoing Phase 1 trial in NSCLC (non-small cell lung cancer) run by Cancer Research UK.

– Enhance commercial utility of OPC1 program by introducing commercially enabling improvements to the manufacturing process in our GMP manufacturing facility.

– Continue engagement with the investment and medical communities with virtual participation at medical and healthcare industry conferences, ongoing throughout 2020.

– Strengthen existing partnerships with the National Institutes of Health, the Israel Innovation Authority, the California Institute for Regenerative Medicine and Cancer Research UK.

– Seek non-dilutive support for certain programs, as may be available, including for coronavirus vaccine development.

Balance Sheet and Cash Flow Highlights

Cash, cash equivalents, and marketable securities totaled $25.8 million as of March 31, 2020. Marketable securities include our remaining ownership of unrestricted securities in OncoCyte Corporation (OncoCyte), AgeX Therapeutics, Inc. (AgeX) and Hadasit Bio-Holdings Ltd (Hadasit).

We have continued to fund our operations primarily by selling a portion of our marketable securities. On January 2, 2020, we sold 2,383,090 shares of OncoCyte stock for net proceeds of approximately $5.0 million. On April 23, 2020, we sold an additional 1,672,689 shares of OncoCyte stock for net proceeds of approximately $3.7 million. We continue to hold approximately 4.3 million shares of OncoCyte stock that are valued at $11.3 million as of May 5, 2020, based on the closing price of its common stock on that date. All of our marketable securities are now in companies in which we hold less than 10% of the outstanding shares.

In conjunction with the sale of AgeX shares to Juvenescence Limited (Juvenescence) in 2018, we also hold a $21.6 million promissory note bearing 7% annual interest that matures on August 30, 2020. As of March 31, 2020, the outstanding principal and accrued interest on the note was $24.0 million. If, prior to August 30, 2020, Juvenescence completes an initial public offering resulting in gross proceeds of at least $50.0 million, the promissory note automatically converts into the Juvenescence securities.

Net cash used in operating activities for the three months ended March 31, 2020 was approximately $5.0 million, a decrease of $4.3 million as compared to $9.3 million in the same period of 2019. This level of quarterly activity was in line with our budgeted annual net operational spend of $16 million for 2020. As a result of incremental expenses we anticipate incurring during the remainder of the year related to the early exercise of our option with Cancer Research UK, our plans for the development of a prophylactic vaccine against SARS-CoV-2 and other coronaviruses, and delays caused by COVID-19 to our OpRegen clinical trial, we anticipate our net operational spend for 2020 will increase modestly.

First Quarter Operating Results

Revenues: Lineage’s revenue is generated primarily from research grants, royalties and licensing fees. Total revenues for the three months ended March 31, 2020 were $0.5 million, a decrease of $0.4 million as compared to $0.9 million for the same period in 2019. The decrease was primarily related to a $0.4 million decrease in grant revenue due to the timing of grant related activities for OpRegen and other ophthalmic applications.

Operating Expenses: Operating expenses are comprised of research and development (R&D) expenses and general and administrative (G&A) expenses. Total operating expenses for the three months ended March 31, 2020 were approximately $7.8 million, a decrease of $5.8 million as compared to $13.6 million for the same period in 2019.

R&D Expenses: R&D expenses for the three months ended March 31, 2020 were $3.3 million, an approximate decrease of $1.7 million as compared to $5.0 million for the same period in 2019. The overall decrease was primarily related to decreases of $1.8 million in OpRegen and other ophthalmic application expenses and $0.4 million in Renevia expenses, offset by an increase of approximately $0.5 million in OPC1 expenses.

G&A Expenses: G&A expenses for the three months ended March 31, 2020 were $4.5 million, a decrease of $4.1 million as compared to approximately $8.6 million for the same period in 2019. The decrease was primarily attributable to a $3.3 million reduction in expenses related to our merger with Asterias Biotherapeutics, Inc. (Asterias), a $0.9 million decrease in salaries, benefits and severance costs primarily related to terminated personnel, a $0.4 million reduction in accounting expenses, a $0.1 million reduction in rent expenses and a $0.1 million reduction in consulting expenses, offset by a $0.5 million increase in legal and patent expenses and a $0.2 million increase related to the cessation of shared services reimbursements.

Loss from Operations: Loss from operations for the three months ended March 31, 2020 was $7.4 million, an approximate decrease of $5.4 million as compared to $12.8 million for the same period in 2019.

Other (Expense) Income, Net: Other income/(expenses), net for the three months ended March 31, 2020 reflected other expense, net of ($1.0) million, compared to other income, net of $47.7 million for the same period in 2019. The variance was primarily related to changes in the value of equity method investments and marketable equity securities for the applicable periods, as well as foreign currency translation adjustments related to Lineage’s international subsidiaries. The value of Lineage’s OncoCyte shares increased by $37.7 million in the three months ended March 31, 2019, which contributed greatly to the overall balance in other income, net for that period.

Net loss attributable to Lineage: The net loss attributable to Lineage for the three months ended March 31, 2020 was $8.4 million, or $0.06 per share (basic and diluted), compared to a net income attributable to Lineage of $39.3 million, or $0.30 per share (basic and diluted), for the same period in 2019.

Conference Call and Webcast

Lineage will host a conference call and webcast today, at 1:30 pm PT/4:30 pm ET to discuss its first quarter 2020 financial results and to provide a business update. A live webcast of the conference call will be available online in the Investors section of Lineage’s website. Interested parties may also access the conference call by dialing (866) 888-8633 from the U.S. and Canada and (636) 812-6629 from elsewhere outside the U.S. and Canada and should request the "Lineage Cell Therapeutics Call". A live webcast of the conference call will be available online in the Investors section of Lineage’s website. A replay of the webcast will be available on Lineage’s website for 30 days and a telephone replay will be available through May 14, 2020, by dialing (855) 859-2056 from the U.S. and Canada and (404) 537-3406 from elsewhere outside the U.S. and Canada and entering conference ID number 7948501.

Veracyte to Present at the UBS Virtual Global Healthcare Conference

On May 7, 2020 Veracyte, Inc. (Nasdaq: VCYT) reported that Bonnie H. Anderson, chairman and chief executive officer, is scheduled to present at the UBS Virtual Global Healthcare Conference on Tuesday, May 19, 2020 at 3:00 p.m. Eastern Time (Press release, Veracyte, MAY 7, 2020, View Source [SID1234557266]).

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The link to the live audio webcast of the company’s presentation will be available by visiting Veracyte’s website at View Source A replay of the webcast will be available for 90 days following the conclusion of the live presentation broadcast.

NantHealth Reports 2020 First Quarter Financial Results

On May 7, 2020 NantHealth, Inc. (NASDAQ-GS: NH), a next-generation, evidence-based, personalized healthcare company, reported financial results for its first quarter ended March 31, 2020 (Press release, NantHealth, MAY 7, 2020, View Source [SID1234557265]).

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In February 2020, NantHealth completed the sale of its Connected Care Business for $47.25 million. Accordingly, the company has classified the current and prior period operating results of its Connected Care Business as discontinued operations. The financial results presented below represent the company’s continuing operations.

"During the first quarter of 2020, we made progress on a number of fronts," said Ron Louks, Chief Operating Officer, NantHealth. "Operationally, we completed the sale of our Connected Care Business, which significantly increased our cash position and further streamlined our operations. Financially, we grew SaaS revenue, substantially increased gross margin and lowered operating expenses compared with the same quarter last year. We also implemented a number of steps to ensure the safety of our employees in response to the COVID-19 pandemic and our team has responded with resilience and dedication to the providers and payer communities that we are proud to serve.

"In addition, we strengthened our leadership team by adding Deanna Wise to our board of directors. Deanna brings extensive clinical Information Technology (IT) experience in the hospital and healthcare industry. We look forward to benefitting from Deanna’s insights and expertise, particularly in helping shape our future operations and strategic direction."

Software and Services Highlights:

Clinical Decision Support (Eviti):
In January, presented Eviti Connect real world data on treatment patterns for patients with advanced colorectal cancer (CRC) at the 2020 Gastrointestinal Cancer Symposium sponsored by the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper). The ability to identify treatment patterns through data analysis can provide unique and critical information to pharma, payers and provider networks to optimize treatment strategies
In January, signed a three-year renewal agreement with one of the largest non-profit rural health plans in the U.S., as previously announced
Signed an agreement with a leading U.S. health insurance company to roll out Eviti Connect across their Medicaid population to additional states, as previously announced. In addition to the pilot states, four of the added states are now live with Eviti Connect, and implementation is underway across three more states, with the remaining states scheduled to go live in the third quarter
Deployed significant workflow and database enhancements to the Eviti platform including:
Warning notifications: allows users to configure a warning and/or deviation notification to alert the submitter when a drug does not comply with the preferred drug program, saving review cycle time and ensuring patients receive correct care
Payer-customized messaging: allows users to indicate when specific data is required in order to complete the Patient Insurance ID field, reducing submission delays
Payer Engagement (NaviNet):
In January, added new payer customer, The Health Plan, servicing members in Ohio and West Virginia, as previously reported. The 5-year agreement includes NaviNet Open as a key component of The Health Plan’s payer-provider collaboration strategy
Launched significant enhancements to the NaviNet Open platform, including AllPayer self-service subscription management workflow. This new storefront, an addition to the NaviNet AllPayer solution, enables the provider office to quickly create and manage subscriptions for our AllPayer offerings, allowing providers to expand their NaviNet access to nearly all health plans offered to their patients
Precision Medicine – Highlights:

In January, presented GPS Cancer platform data revealing increased opportunities for HER2 directed therapy in colorectal cancer patients at the 2020 Gastrointestinal Cancer Symposium sponsored by the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper), as reported previously. The data showed that up to 40% more patients may be eligible for HER2 directed therapies, which have implications for drug development and clinical trials
Artificial Intelligence – Highlights:

In January, NantHealth and NantOmics presented an initial report on a novel artificial intelligence (AI) platform for aiding pathologists in image-based lung cancer subtyping at the Society for Imaging Science and Technology’s International Symposium on Electronic Imaging 2020, as reported previously. This novel machine vision software platform accurately subtypes lung cancer pathology and achieves high concordance with analysis performed by trained medical pathologists.
In February, NantHealth and NantOmics announced the publication of a peer-reviewed study in Breast Cancer Research, a Springer Nature journal, on a novel AI technique in breast cancer, as reported previously. The study reports on a novel deep-learning system of digital pathology images and omics data used together to more precisely identify mechanisms of therapy resistance.
Business and Financial Highlights

For the 2020 first quarter, total net revenue was $18.2 million, which included $18.1 million of SaaS revenue. This compares with 2019 first quarter total net revenue of $20.2 million, which included $17.8 million of SaaS revenue and $1.6 million of home health care services revenue, a business the Company divested on June 7, 2019.
Gross profit increased to $11.0 million, or 60% of total net revenue, compared with $9.9 million, or 49% of total net revenue, for the prior year period. The increase was primarily driven by continued growth of the Company’s higher margin SaaS business, the divestiture of lower margin businesses and overall cost management.
Selling, general and administrative (SG&A) expenses declined to $12.4 million from $15.3 million in 2019 first quarter, mainly driven by ongoing cost management efforts and efficiencies in overall processes. Research and development (R&D) expenses decreased to $3.6 million from $3.9 million.
Net loss from continuing operations, net of tax, was $8.9 million, or $0.08 per share, compared with $19.6 million, or $0.18 per share, for the 2019 first quarter.
On a non-GAAP basis, net loss from continuing operations was $6.1 million, or $0.06 per share, down from $10.6 million, or $0.10 per share, for the first quarter of last year. The improvement reflects the company’s ongoing efforts to manage costs, growth of its SaaS business and better overall financial performance.
At March 31, 2020, cash and cash equivalents totaled $47.5 million.
Conference Call Information and Forward-Looking Statements

Later today, the company will host a conference call at 1:30 p.m. PT (4:30 p.m. ET) to review its results of operations for the first quarter ended March 31, 2020. The conference call will be available to interested parties by dialing 844-309-3709 from the U.S. or Canada, or 281-962-4864 from international locations, passcode 2797775. The call will be broadcast via the Internet at www.nanthealth.com. Listeners are encouraged to visit the website at least 10 minutes prior to the start of the scheduled presentation to register, download and install any necessary audio software. A playback of the call will be archived and accessible on the same website for at least three months.

Discussion during the conference call may include forward-looking statements regarding topics such as the company’s financial status and performance, regulatory and operational developments, and other comments the company may make about its future plans or prospects in response to questions from participants on the conference call.

Personalis Reports First Quarter 2020 Financial Results

On May 7, 2020 Personalis, Inc. (Nasdaq: PSNL), a leader in advanced genomics for cancer, reported financial results for the first quarter ended March 31, 2020 (Press release, Personalis, MAY 7, 2020, View Source [SID1234557264]).

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First Quarter Highlights

Reported record revenues of $19.2 million in the first quarter of 2020 versus $14.1 million in the first quarter of 2019, an increase of 36%

A total of 26 customers have placed orders for NeXT as of March 31, 2020, with 7 of those customers placing their orders in the first quarter of 2020

Received a new order outside of oncology to deliver neoantigen prediction, which will leverage the Company’s proprietary technology platform

"I’m proud to say that we were able to report record revenues once again this quarter, in spite of the initial impact from the COVID-19 pandemic, and continued to see strong ordering levels from both our existing and new customers," said John West, Chief Executive Officer. "Also, while our laboratory operations have been scaled down due to the COVID-19 shelter-in-place orders, and will be at least through May, we feel well-positioned to work through our VA MVP samples and also service our biopharma customers when they are able to send us their samples."

First Quarter 2020 Financial Results

Revenues were $19.2 million in the three months ended March 31, 2020, up 36% from $14.1 million in the same period of the prior year. First quarter revenue growth was driven by an increase in volume for testing and analytical services provided to the U.S. Department of Veterans Affairs Million Veteran Program (VA MVP). In the first quarter, the VA MVP accounted for $14.8 million, or 77%, of revenues and the remaining $4.4 million, or 23%, was from biopharmaceutical and all other customers.

Gross margin was 21.1% for the three months ended March 31, 2020, compared with 28.3% in the same period of the prior year.

Operating expenses were $13.7 million for the three months ended March 31, 2020, compared with $9.4 million in the same period of the prior year.

Net loss was $9.1 million for the three months ended March 31, 2020 and net loss per share was $0.29 based on a weighted-average basic and diluted share count of 31.3 million, compared with a net loss of $5.7 million and a net loss per share of $1.84 on a weighted-average basic and diluted share count of 3.1 million in the same period of the prior year.

Cash, cash equivalents, and short-term investments were $120.0 million as of March 31, 2020.

Outlook and COVID-19

Due to uncertainty surrounding the COVID-19 pandemic, Personalis will not provide an outlook for fiscal 2020 at this time, and will plan to give an update during its second quarter earnings announcement and press release, to the extent practicable, based on available information at that time.

Webcast and Conference Call Information

Personalis will host a conference call to discuss the first quarter financial results after market close on Thursday, May 7, 2020 at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time. The conference call can be accessed live over the phone (866) 220-8061 for U.S. callers or (470) 495-9168 for international callers, using conference ID: 9370329. The live webinar can be accessed at View Source

Coherus BioSciences Reports First Quarter 2020 Financial Results

On May 7, 2020 Coherus BioSciences, Inc. ("Coherus" or the "Company", Nasdaq: CHRS), reported financial results for the quarter ended March 31, 2020 (Press release, Coherus Biosciences, MAY 7, 2020, View Source [SID1234557263]).

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First Quarter 2020 and Recent Corporate Highlights

Strong financial position and performance to support pipeline development and long-term growth:

Coherus had cash and cash equivalents of $193.3 million as of March 31, 2020.

Completed a convertible notes financing for an aggregate principal amount of $230 million at a 1.500% coupon in April 2020. The net proceeds from this financing will be used for opportunistic pipeline acquisitions or licenses, working capital, and for other general corporate purposes, which may include debt repayment in the future.

Cash flow from operating activities was $13.5 million for the first quarter of 2020.

Net product revenue for the first quarter of 2020 was $116.2 million, and net income was $35.6 million, or $0.48 per share on a diluted basis.

Non-GAAP income during the first quarter of 2020 was $49.8 million, or $0.67 on a diluted basis.

Coherus has remained cash flow positive since the second quarter of 2019.

Coherus completed a key licensing transaction in oncology to enhance its midterm product pipeline in the United States:

Entered into a license agreement with Innovent Biologics, (Suzhou) Co., Ltd., ("Innovent"), a leading biopharmaceutical company headquartered in China, to commercialize Innovent’s biosimilar candidate to Avastin (bevacizumab) in the United States and Canada.

First Quarter 2020 Financial Results

Net product revenue for first quarter of 2020 was $116.2 million. Cost of goods sold for the same quarter was $6.9 million, resulting in a gross profit margin of 94%, a 213% increase compared to the net product revenue of $37.1 million for the same period in 2019. Net product revenue increased year-over-year markedly as a result of market penetration.

Research and development (R&D) expenses for the first quarter 2020 were $33.1 million, as compared to $18.8 million for the same period in 2019. The increase in R&D expenses was largely due to an upfront payment obligation of $5.0 million pursuant to the Innovent license agreement and increased expenses related to

preparations for the filing of the 351(k) BLA for CHS-1420 (Humira (adalimumab) biosimilar) and the development of other biosimilar product candidates.

Selling, general and administrative (SG&A) expenses for the first quarter of 2020 were $35.4 million, as compared to $32.7 million for the same period in 2019. The increases in SG&A expenses were mainly attributable to an increase in salesforce personnel, related commercial functions and marketing programs to support the continued growth in UDENYCA sales. The increases were partially offset by a decrease in legal costs attributable to the legal settlement that the Company entered into with Amgen in May 2019.

Cash, cash equivalents were $193.3 million as of March 31, 2020, as compared to $177.7 million as of December 31, 2019.

Net income (loss) for the first quarter of 2020 was $35.6 million, or $0.48 per share on a diluted basis, compared to a net loss of ($20.0) million, or ($0.29) per share on a basic and diluted basis for the same period in 2019.

Non-GAAP net income (loss) for the first quarter of 2020 was $49.8 million, or $0.67 per share on a diluted basis, compared to a non-GAAP net loss of ($10.5) million, or ($0.15) per share on a basic and diluted basis for the same period in 2019. See "Non-GAAP Financial Measures" below for a discussion on how we calculate non-GAAP net income (loss) and a reconciliation to the most directly comparable GAAP measure.

Guidance for the Next Nine Months from March 31, 2020

Coherus will continue delivering on the promise of biosimilars and laying the foundation for long-term growth across its three therapeutic areas:

Oncology

UDENYCA (pegfilgrastim-cbqv)

Maintain market position as the leading pegfilgrastim biosimilar of choice leveraging the validated branded-biosimilar strategy of offering a robust value proposition across all key customer segments.

Increase penetration against all Neulasta dosage forms, while maintaining average selling price ("ASP") discipline.

Advance the Company’s Avastin (bevacizumab) oncology biosimilar candidate in-licensed from Innovent by initiating a planned three-way pharmacokinetic ("PK") study using innovator Avastin drug articles from the United States and China compared to Innovent’s biosimilar to bevacizumab, and additional analytical similarity exercises. The Company expects to submit a 351(k) BLA with the FDA in 2021, depending on the outcome of these exercises and the timing of required interactions with the FDA.

Diligence the option to commercialize Innovent’s Rituxan (rituximab) oncology biosimilar in the United States.

Ophthalmology

Facilitate Bioeq’s resubmission of a 351(k) BLA with the U.S. FDA for the biosimilar candidate to Lucentis (ranibizumab) in the second half of 2020, with expected product launch in the United States to address a $6 billion anti-VEGF ophthalmology market, if approved, enabling the Company to potentially play a key role in market formation.

Advance the Company’s internally developed CHS-2020 Eylea (aflibercept) ophthalmology biosimilar currently in preclinical development to an expected Phase 3 clinical trial initiation in 2021, with launch projected in 2025, if approved.

Immunology

Advance certain manufacturing, regulatory and development activities for the Company’s internally developed CHS-1420 immunology biosimilar to Humira (adalimumab) with an anticipated filing of a 351(k) BLA in the second half of 2020. The Company expects this timing will enable a projected competitive market entry in the United States on or after July 1, 2023, if approved.

CHS-131

Advance previously announced strategic alternatives for the Company’s program in CHS-131, a small molecule for nonalcoholic steatohepatitis ("NASH") and multiple sclerosis.

Financial Guidance

Anticipate that R&D and SG&A expenses combined together will range between $285 million and $310 million for the full fiscal year 2020, excluding upfront and milestone payments from entering into potential new collaborations.

Conference Call Information

When: Thursday, May 7, 2020 starting at 4:30 p.m. ET

Dial-in: (844) 452-6826 (Toll Free) or (765) 507-2587 (International)

Conference ID: 6167564

Webcast: View Source

Please join the conference call at least 10 minutes early to register. The webcast will be archived on the Coherus website.

First quarter 2020 financial results, are posted on the Coherus website at View Source.