On March 14, 2016 Cellular Biomedicine Group Inc. (NASDAQ: CBMG) ("CBMG" or the "Company"), a clinical-stage biomedicine firm engaged in the development of effective treatments for degenerative and cancerous diseases, reported business highlights and financial results for the full year ended December 31, 2015 (Press release, Cellular Biomedicine Group, MAR 14, 2016, View Source [SID:1234509527]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"2015 proved to be a transformative year for Cellular Biomedicine Group with the Company’s entrance into the dynamic field of immuno-oncology. We now operate under dual technology platforms: Immuno-oncology (I/O) and Stem Cells. We expect to advance several of our CAR-T candidates including CBM.CD19 and CBM.CD20 into multiple indications of hematological cancer. Eventually, our effort to sponsor multi-center clinical trials in the near future should lead to servicing the large cancer market in China. We also reported encouraging Phase IIb data from our most advanced stem cell program for Knee Osteoarthritis (KOA), and we will explore the possibility of entrance into the U.S. market," commented Tony (Bizou) Liu, CBMG’s Chief Executive Officer. "The expansion of our GMP facilities into Beijing allows us to prepare for anticipated manufacturing demands from our immuno-oncology and stem cell platforms for clinical trials and future commercialization opportunities. We strengthened our operating and management capabilities with the addition of key talents, which will better position the Company to monetize our growing cell therapy pipeline. We look forward to an exciting 2016 as we leverage these strengths to execute on our clinical milestones, build an innovative pipeline and move our clinical assets into later stage clinical development."

2015 and Recent Clinical Developments

Immuno-Oncology Platform

Announced positive clinical data from Phase I of its CAR-T immuno-oncology clinical development programs of:
CBM-CD19.1 for Acute Lymphoblastic Leukemia (B-cell ALL)
CBM-CD20.1 for Advanced Diffuse Large B Cell Lymphoma (DLBCL)
CBM-CD30.1 for Stage III and IV Hodgkin’s lymphoma
CBM-EGFR.1 for the treatment of patients with EGFR expressing advanced relapsed/refractory solid tumors.
In all trials the assets were shown to be safe, feasible and efficacious.
The participants enrolled in the studies were advanced, relapsed, and/or refractory to other standard-of-care therapies. This patient population has substantial unmet medical needs.
Stem Cell Therapies Platform

Announced encouraging 48-week clinical data from the Phase IIb trial of its ReJoin haMPC therapy for Knee Osteoarthritis (KOA), revealing increase of patient’s knee cartilage volume and relief of pain;

Launched an investigator initiated Phase I clinical trial of an off-the-shelf allogeneic adipose-derived mesenchymal progenitor cell (haMPC) AlloJoinTMtherapy for KOA patients in China;

Recruited patients for a clinical study on ReJoin therapy for Cartilage Damage (CD) resulting from sports injury, which also serves as a supporting study of ReJoinfor KOA with arthroscopic evidences. We plan to release results from this study in 1H 2017.

2015 and Recent Corporate Highlights

Completed two acquisitions, which substantially increased CBMG’s immuno-oncology platform, including:
PLA General Hospital’s ("PLAGH", Beijing, also known as "301 Hospital") Chimeric Antigen Receptor T cell (CAR-T) therapies, redirected T cells against CD19, CD20, CD30 and Human Epidermal Growth Factor Receptor (EGFR or HER1), their patents (all pending), and Phase I/II clinical data of the aforementioned therapies and manufacturing knowledge;

Blackbird Bio Finance and University of South Florida’s ("Licensor") next generation GVAX vaccine’s ("CD40LGVAX") related technologies, technical knowledge and FDA IND approved clinical trial protocol
Expanded the Company’s cell manufacturing capabilities with the opening of the Company’s third GMP facility, a 15,000 square feet site in Beijing, China, approximately half of which has been designed as a GMP equipped facility to support clinical batch production and commercial scale manufacturing;

Commenced revenue generation through the Company’s T Cells Receptor ("TCR") clonality analysis and CentrixTTM adoptive cell transfer technology services provided to 9 cooperative hospitals located in Beijing, Shandong and Anhui provinces in China;
Strengthened the leadership team with the appointments of Richard L. Wang, Ph.D., MBA, PMP, formerly with GSK, as Chief Operating Officer and Yihong Yao, Ph.D., B.S., formerly with Astrazeneca/Medimmune as Chief Scientific Officer;

Formed a Scientific Advisory Board (SAB) with the appointment of Alan List, M.D. as Chair of the SAB, the appointment of Scott J. Antonia, M.D., Ph.D. to advise the company on immuno-oncology and Guoping Fan, Ph.D. to advise the Company on stem cell technology and its applications;

Continued to demonstrate good corporate governance by meeting the required higher listing standards to successfully upgrade the listing of the Company’s securities from the NASDAQ Capital Market to the NASDAQ Global Market and being selected into the broad-market Russell 3000 Index;

Advanced the Company’s cash position:
Total private placement transactions of approximately $19.6 Million in 2015
Announced agreement of Wuhan Dangdai Science & Technology Industries Group Inc. to invest up to $43.13 million for 2.27 million shares of the Company’s common stock, representing a 19.4% stake investment in Q1 2016 with an initial closing of $5 million in February 2016, and the remaining $38.13 million by April 15, 2016.

Full Year 2015 Financial Results

Cash Position: The Company had working capital of $13.7 million as of December 31, 2015 compared to $12.0 million as of December 31, 2014. Cash position increased to $14.9 million at December 31, 2015 compared to $14.8 million at December 31, 2014, due to an increase in cash generated from financing activities as a result of a private placement financing in 2015 for aggregate net proceeds of approximately $19.0 million, partially offset by an increase in cash used in operating and investing activities.

Net Cash Used in Operating Activities: Full-year 2015 net cash used in operating activities was $11.8 million compared to $9.7 million in 2014. The change in operating assets and liabilities was primarily due to an increase in accounts receivables, long-term prepaid expenses combined with decreases in tax payables and non-current liabilities, partially offset by an increase in accrued expenses.

Revenue: Full-year 2015 revenue was $2.5 million compared to $0.6 million in 2014. All revenue for the year ended December 31, 2015 was derived from TCR technology services.

G&A Expenses: Full-year 2015 general and administrative expenses were $13.1 million compared $7.9 million in 2014. Increased expenses in 2015 were associated with increased corporate activities related to the management and the development of the Company’s biomedicine business, which were primarily attributed to:

An increase in stock-based compensation expense of $3.7 million, which primarily resulted from the new grants and higher fair value of unvested options in 2015 after the Company listed on Nasdaq in June 2014 compared with those unvested options as of December 31, 2014;
An increase in payroll of $0.3 million in line with the headcount increase in management in 2015;
An increase in depreciation and amortization of $0.2 million, which was mainly attributed to the technical knowledge and patents obtained from the acquisition of AG in the third quarter 2014;
R&D Expenses: Full-year 2015 research and development expenses were $7.6 million compared to $3.1 million in 2014, the increase mainly attributable to the increase of our immunotherapy research and development team, which resulted in an increase in payroll expenses of $1.2 million and an increase in stock-based compensation expenses of $1.8 million.

Net Loss: Full-year 2015 net loss allocable to common stock holders was $19.4 million compared to $15.5 million in 2014. Changes in net loss were primarily attributable to changes in operations of our biomedicine segment.

Primary 2016 Operating Objectives
The Company’s key 2016 operational objectives are to seek early possibilities of conducting multi-center Phase IIb trials with its CAR-T constructs after confirming their safety and tolerability profile, to evaluate feasibility of sponsoring a registration trial-like clinical study to support a New Drug Application (NDA) for an allogeneic haMPC Knee Osteoarthritis therapy ("Allo KOA") study in the United States, and continue to build a pipeline of advanced technologies to bolster the Company’s CAR-T China market position.