Cellular Biomedicine Group Reports Third Quarter Financial Results and Recent Operational Highlights
SHANGHAI, China and CUPERTINO, Calif., Nov. 08, 2016 (GLOBE NEWSWIRE) -- Cellular Biomedicine Group Inc. (NASDAQ:CBMG) (“CBMG” or the “Company”), a clinical-stage biomedicine firm engaged in the development of immunotherapies for cancer and effective stem cell therapies for degenerative diseases, today reported financial results and business highlights for the third quarter ended September 30, 2016.
“In recent months, we have been diligently preparing for the launch of our upcoming CD19 and CD20 clinical studies and strengthening our CAR-T intellectual property portfolio,” commented Tony (Bizuo) Liu, CBMG’s Chief Executive Officer. “We believe that since August 2015, the China Food and Drug Administration has been working towards formalizing a national cell therapy policy that will lay the groundwork for the safe use of immune cell and stem cell therapy treatments in China. Although the PRC government is still in the process of codifying industry regulations for such cell therapies, in anticipation of potential future market opportunities, we have accelerated the launch of multiple Phase I/IIb clinical studies with CAR-T CD19 and CD20 assets to advance our immuno-oncology pipeline. We have a strong balance sheet to finance our current clinical studies and to further expand our translational medicine research and development.”
Third Quarter 2016 Financial Performance
1. Cash Position: $44.1 million cash and cash equivalents as compared to $14.9 million as of December 31, 2015.
2. Cash Used in Operating Activities: We used $3.3 million and $12.1 million for the three months and nine months ended September 30, 2016 in operating activities as compared to $2.9 million and $8.6 million for the same periods in 2015.
3. G&A Expenses: General and administrative expenses for the three months and nine months ended September 30, 2016 were $2.8 million and $8.6 million respectively, compared to $3.5 million and $9.9 million for the same periods in 2015.
4. R&D Expenses: Research and development expenses for the three months and nine months ended September 30, 2016 were $2.9 million and $8.3 million respectively, compared to $2.2 million and $5.0 million for the same periods in 2015.
5. Net Loss: Net loss allocable to common stock holders for the three months ended September 30, 2016 was $10.7 million, compared to $5.1 million for the same period in 2015. A $4.6 million impairment charge was incurred in the third quarter due to legacy, non-core business investments.
Business and Operational Highlights for the Third Quarter 2016 to date
- The Company signed a tenancy deposit agreement to lease a 10,500 square meters facility located in Shanghai;
- Appointment of Dr. Zhou Hansheng as a Director of the Company; and
- Completed treatment of eighteen patients in Phase I clinical study of AlloJoinTM haMPC therapy for Knee Osteoarthritis (KOA).
About Cellular Biomedicine Group
Cellular Biomedicine Group, Inc. develops proprietary cell therapies for the treatment of certain degenerative and cancerous diseases. Our developmental stem cell and Immuno-Oncology projects are the result of research and development by scientists and doctors from China and the United States. Our GMP facilities in China, consisting of twelve independent cell production lines, are designed, certified and managed according to U.S. standards. To learn more about CBMG, please visit: www.cellbiomedgroup.com
Forward-Looking Statements
Statements in this press release relating to plans, strategies, trends, specific activities or investments, and other statements that are not descriptions of historical facts may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors, which include risks inherent in doing business, trends affecting the global economy, including the devaluation of the RMB by China in August 2015 and other risks detailed from time to time in CBMG’s reports filed with the Securities and Exchange Commission, quarterly reports on form 10-Q, current reports on form 8-K and annual reports on form 10-K. Forward-looking statements may be identified by terms such as "may," "will," "expects," "plans," "intends," "estimates," "potential," or "continue," or similar terms or the negative of these terms. Although CBMG believes the expectations reflected in the forward-looking statements are reasonable, they cannot guarantee that future results, levels of activity, performance or achievements will be obtained. CBMG does not have any obligation to update these forward-looking statements other than as required by law.
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CELLULAR BIOMEDICINE GROUP, INC. |
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CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS |
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(UNAUDITED) |
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| For the Three Months Ended | For the Nine Months Ended | |||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||
| 2016 | 2015 |
2016 |
2015 | |||||||||||||||||
| Net sales and revenue | $ | 10,012 | $ | 624,907 | $ | 570,102 | $ | 1,885,256 | ||||||||||||
| Operating expenses: | ||||||||||||||||||||
| Cost of sales | 9,128 | 443,416 | 835,908 | 1,335,707 | ||||||||||||||||
| General and administrative | 2,790,305 | 3,467,184 | 8,638,877 | 9,915,956 | ||||||||||||||||
| Selling and marketing | 124,143 | 190,152 | 342,377 | 500,393 | ||||||||||||||||
| Research and development | 2,897,736 | 2,190,240 | 8,268,953 | 4,968,352 | ||||||||||||||||
| Impairment of investments | 4,611,714 | - | 4,611,714 | 123,428 | ||||||||||||||||
| Total operating expenses | 10,433,026 | 6,290,992 | 22,697,829 | 16,843,836 | ||||||||||||||||
| Operating loss | (10,423,014 | ) | (5,666,085 | ) | (22,127,727 | ) | (14,958,580 | ) | ||||||||||||
| Other income (expense): | ||||||||||||||||||||
| Interest income | 22,338 | 8,386 | 57,678 | 29,417 | ||||||||||||||||
| Other income (expense) | (17,314 | ) | 492,101 | 6,652 | 502,921 | |||||||||||||||
| Total other income, net | 5,024 | 500,487 | 64,330 | 532,338 | ||||||||||||||||
| Loss before taxes | (10,417,990 | ) | (5,165,598 | ) | (22,063,397 | ) | (14,426,242 | ) | ||||||||||||
| Income taxes credit (provision) | (243,230 | ) | 23,400 | (5,218 | ) | (29,602 | ) | |||||||||||||
| Net loss | $ | (10,661,220 | ) | $ | (5,142,198 | ) | $ | (22,068,615 | ) | $ | (14,455,844 | ) | ||||||||
| Other comprehensive income (loss): | ||||||||||||||||||||
| Cumulative translation adjustment | (58,824 | ) | (225,198 | ) | (314,189 | ) | (163,353 | ) | ||||||||||||
| Unrealized gain (loss) on investments, net of tax | - | (1,520,000 | ) | 5,300,633 | 6,543,460 | |||||||||||||||
| Reclassification adjustments, net of tax, in connection with other-than-temporary impairment of investments | (5,557,939 | ) | - | (5,557,939 | ) | - | ||||||||||||||
| Total other comprehensive income (loss): | (5,616,763 | ) | (1,745,198 | ) | (571,495 | ) | 6,380,107 | |||||||||||||
| Comprehensive gain (loss) | $ | (16,277,983 | ) | $ | (6,887,396 | ) | $ | (22,640,110 | ) | $ | (8,075,737 | ) | ||||||||
| Net loss per share : | ||||||||||||||||||||
| Basic | $ | (0.75 | ) | $ | (0.44 | ) | $ | (1.67 | ) | $ | (1.27 | ) | ||||||||
| Diluted | $ | (0.75 | ) | $ | (0.44 | ) | $ | (1.67 | ) | $ | (1.27 | ) | ||||||||
| Weighted average common shares outstanding: | ||||||||||||||||||||
| Basic | 14,128,465 | 11,622,756 | 13,253,290 | 11,399,958 | ||||||||||||||||
| Diluted | 14,128,465 | 11,622,756 | 13,253,290 | 11,399,958 | ||||||||||||||||
| CELLULAR BIOMEDICINE GROUP, INC. | |||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||
| (UNAUDITED) | |||||||
| September 30, | December 31, | ||||||
| 2016 | 2015 | ||||||
| Assets | |||||||
| Cash and cash equivalents | $ | 44,115,886 | $ | 14,884,597 | |||
| Accounts receivable, less allowance for doubtful amounts of $10,707 and $nil as of September 30, 2016 and December 31, 2015, respectively | 53,477 | 630,332 | |||||
| Other receivables | 264,802 | 271,344 | |||||
| Inventory | 253,173 | 390,886 | |||||
| Prepaid expenses | 661,144 | 367,050 | |||||
| Taxes recoverable | - | 150,082 | |||||
| Total current assets | 45,348,482 | 16,694,291 | |||||
| Investments | 509,424 | 5,379,407 | |||||
| Property, plant and equipment, net | 3,119,174 | 2,768,900 | |||||
| Goodwill | 7,678,789 | 7,678,789 | |||||
| Intangibles, net | 14,570,556 | 15,949,100 | |||||
| Long-term prepaid expenses and other assets | 1,507,686 | 989,935 | |||||
| Total assets | $ | 72,734,111 | $ | 49,460,422 | |||
| Liabilities and Stockholders' Equity | |||||||
| Liabilities: | |||||||
| Accounts payable | $ | 220,205 | $ | 260,886 | |||
| Accrued expenses | 663,880 | 845,087 | |||||
| Taxes payable | 30,000 | - | |||||
| Other current liabilities | 1,015,076 | 1,913,284 | |||||
| Total current liabilities | 1,929,161 | 3,019,257 | |||||
| Other non-current liabilities | 10,482 | 76,229 | |||||
| Total liabilities | 1,939,643 | 3,095,486 | |||||
| Stockholders' equity: | |||||||
| Preferred stock, par value $.001, 50,000,000 shares authorized; none issued and outstanding as of September 30, 2016 and December 31, 2015, respectively | - | - | |||||
| Common stock, par value $.001, 300,000,000 shares authorized; 14,240,610 and 11,711,645 issued and outstanding as of September 30, 2016 and December 31, 2015, respectively | 14,241 | 11,711 | |||||
| Additional paid in capital | 150,874,763 | 103,807,651 | |||||
| Accumulated deficit | (79,406,926 | ) | (57,338,311 | ) | |||
| Accumulated other comprehensive income (loss) | (687,610 | ) | (116,115 | ) | |||
| Total stockholders' equity | 70,794,468 | 46,364,936 | |||||
| Total liabilities and stockholders' equity | $ | 72,734,111 | $ | 49,460,422 | |||
| CELLULAR BIOMEDICINE GROUP, INC. | ||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
| For the Nine Months Ended | ||||||||
| September 30, | ||||||||
| 2016 | 2015 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net loss | $ | (22,068,615 | ) | $ | (14,455,844 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation and amortization | 2,034,411 | 1,537,323 | ||||||
| Loss on disposal of assets | 1,034 | - | ||||||
| Stock based compensation expense | 3,944,125 | 5,672,955 | ||||||
| Decrease in fair value of accrued expenses for the acquisition of intangible assets | - | (413,559 | ) | |||||
| Other than temporary impairment on investments | 4,611,714 | 123,428 | ||||||
| Realized losses from sale of investments | - | 5,178 | ||||||
| Inventory provision | 110,145 | - | ||||||
| Allowance for doubtful account | 10,707 | - | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | 548,268 | (275,317 | ) | |||||
| Other receivables | 1,275 | (176,301 | ) | |||||
| Inventory | 33,398 | (49,828 | ) | |||||
| Prepaid expenses | (307,924 | ) | 108,055 | |||||
| Taxes recoverable | 150,082 | - | ||||||
| Other current assets | - | 110,347 | ||||||
| Long-term prepaid expenses and other assets | (376,214 | ) | (156,704 | ) | ||||
| Accounts payable | (33,281 | ) | (280,548 | ) | ||||
| Accrued expenses | (167,615 | ) | 183,105 | |||||
| Advances payable to related party | - | (30,216 | ) | |||||
| Other current liabilities | (528,430 | ) | (63,426 | ) | ||||
| Taxes payable | 30,000 | (198,488 | ) | |||||
| Other non-current liabilities | (65,449 | ) | (212,371 | ) | ||||
| Net cash used in operating activities | (12,072,369 | ) | (8,572,211 | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Proceed from sale of investments, net of issuance cost paid | - | 1,480 | ||||||
| Purchases of intangibles | (11,160 | ) | (4,577,740 | ) | ||||
| Purchases of assets | (1,642,179 | ) | (918,289 | ) | ||||
| Net cash used in investing activities | (1,653,339 | ) | (5,494,549 | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Net proceeds from the issuance of common stock | 42,437,374 | 18,964,849 | ||||||
| Proceeds from exercise of stock options | 685,712 | 478,798 | ||||||
| Net cash provided by financing activities | 43,123,086 | 19,443,647 | ||||||
| EFFECT OF EXCHANGE RATE CHANGES ON CASH | (166,089 | ) | (41,094 | ) | ||||
| INCREASE IN CASH AND CASH EQUIVALENTS | 29,231,289 | 5,335,793 | ||||||
| CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 14,884,597 | 14,770,584 | ||||||
| CASH AND CASH EQUIVALENTS, END OF PERIOD | $ | 44,115,886 | $ | 20,106,377 | ||||
| SUPPLEMENTAL CASH FLOW INFORMATION | ||||||||
| Cash paid for income taxes | $ | 6,705 | $ | 99,668 | ||||
| Non-cash investing activities | ||||||||
| Acquisition of intangible assets through issuance of the Company's stock | $ | - | $ | 1,096,399 | ||||
Contacts: Sarah Kelly Director of Corporate Communications, CBMG +1 408-973-7884 sarah.kelly@cellbiomedgroup.com Vivian Chen Managing Director Investor Relations, Grayling +1 347 481-371 vivian.chen@grayling.com
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