On November 9, 2015 Asterias Biotherapeutics, Inc. (NYSE MKT: AST), a biotechnology company focused on the emerging field of regenerative medicine, reported financial and operating results for the third quarter ended September 30, 2015 (Press release, BioTime, NOV 9, 2015, View Source;p=RssLanding&cat=news&id=2110632 [SID:1234508149]).
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"Asterias continued to achieve solid progress in the third quarter toward advancing the clinical development of our key therapeutic programs," stated Pedro Lichtinger, President and CEO of Asterias. "We completed recruitment for the initial, low-dose safety cohort of the AST-OPC1 Phase 1/2a clinical trial for spinal cord injury. To date, no serious adverse events have been observed in any of the three treated patients. Following recommendation by the Data Monitoring Committee, we started patient enrollment for the second cohort in which patients will be treated with a higher dose of AST-OPC1 that is in the range that we believe to be efficacious and that has the potential to bring benefit to patients. Importantly, the first patient in the initial, low-dose safety cohort has shown steady neurological improvement at both 2-month and 3-month post-injection assessments. Also during the quarter, we announced a strategic collaboration to advance development of large scale manufacturing processes for AST-VAC2, our allogeneic dendritic cell immunotherapy. This manufacturing agreement will streamline and scale manufacturing processes for AST-VAC2 to support advanced clinical trials, including the planned Phase 1/2a clinical trial in lung cancer, and eventual commercialization of AST-VAC2. We anticipate achieving significant additional clinical milestones during the next 12 months."
Recent Corporate Developments
On November 2, 2015, Asterias announced the appointment of Georgia Erbez as Chief Financial Officer. Ms. Erbez brings to Asterias an impressive track record of achievement and a broad range of financial management and strategic planning experience, especially in the areas of capital resource development and business development.
Research and Development Highlights
AST-VAC1 (antigen-presenting autologous dendritic cells)
Following the presentation of promising Phase 2 results at the 2015 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting during the second quarter, the Company has continued to advance its planning for further clinical development of AST-VAC1, including holding a clinical advisory panel to design a pivotal trial, and initiating the selection process for a contract manufacturing organization for that trial.
AST-OPC1 (oligodendrocyte progenitor cells)
In August, Asterias concluded recruitment of the initial safety cohort of the SCiStar Phase 1/2a dose-escalation clinical trial of AST-OPC1 (oligodendrocyte progenitor cells) for complete cervical spinal cord injury (SCI), in which three patients were administered a low dose of 2 million AST-OPC1 cells. The results of the study continue to support a robust safety profile for AST-OPC1, with no serious adverse events observed in any of the three treated patients to date.
In October, following review of the 30-day post-injection safety data from the initial safety cohort, the Data Monitoring Committee recommended dose escalation to the second cohort in the SCiStar Phase 1/2a clinical trial. Recruitment for the second cohort has commenced, with a planned enrollment of five patients who will each receive 10 million cells of AST-OPC1. Asterias expects to complete enrollment of the 10 million cell cohort, and to receive safety data, in the first half of 2016. Initial efficacy data readouts from the trial are expected in the second half of 2016. The first patient in the safety cohort, at the 2-month post-injection assessment, had progressed from a complete ASIA Impairment Scale (AIS) A injury to an incomplete AIS B injury. At 3-months post-injection, this patient demonstrated additional neurological improvement to an AIS C injury.
Asterias announced the publication of preclinical data in Regenerative Medicine that supports the safety and use of AST-OPC1 as a treatment for SCI. The preclinical results showed that AST-OPC1 cells did not cause any adverse clinical observations, toxicities, allodynia or tumors. AST-OPC1 exhibited robust persistence and limited migration within the thoracic and cervical spinal cord. In addition, AST-OPC1 demonstrated nerve growth stimulating properties and remyelinating properties that supported restoration of function in animal models.
In the third 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 announced a collaboration with the UK-based Cell Therapy Catapult to advance development of large scale manufacturing processes for AST-VAC2, Asterias’ allogeneic dendritic cell immunotherapy. Under the agreement, the Cell Therapy Catapult will streamline and scale manufacturing processes for AST-VAC2 to support advanced clinical trials and eventual commercialization of AST-VAC2. Asterias has an ongoing partnership with Cancer Research UK to execute the first stage of AST-VAC2 clinical development, under which Cancer Research UK will sponsor and manage a Phase 1/2a clinical trial of AST-VAC2 in non-small cell lung carcinoma.
Third Quarter [Unaudited] Financial Results
Total revenues in the third quarter 2015 were $1.4 million, which were primarily comprised of grant income and royalty revenues on product sales by licensees. Total revenues in the comparable quarter in the prior year were $85,000. Operating expenses in the third quarter were $6.2 million, compared to $4.0 million in the prior year period. Research and development (R&D) expenses in the third quarter were $4.6 million, compared to $2.6 million in the comparable quarter of the prior year. General and administrative (G&A) expenses in the third quarter were $1.6 million, compared to $1.5 million in the comparable quarter of the prior year.
Net loss for the third quarter 2015 was $3.5 million, including a deferred income tax benefit of approximately $1.6 million. Net loss in the third quarter 2014 was $1.7 million, including a deferred income tax benefit of approximately $2.3 million. On a per share basis, net loss for the third quarter was $0.09 per share, compared to a loss of $0.05 per share for the comparable quarter of the prior year.
Cash and cash equivalents were $12.6 million as of September 30, 2015, compared to $3.1 million as of December 31, 2014. At September 30, 2015, the Company held 3.9 million BioTime common shares, with a market value of approximately $11.6 million on that date.
For the third quarter, net cash used in operating activities was $3.6 million. The Company continues to expect net cash burn in 2015 to be in the range of $15 million to $17 million.