- Ended Second Quarter with $47.5 million in Cash -
SHANGHAI, China and CUPERTINO, Calif., Aug. 09, 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 second quarter and six months ended June 30, 2016.
“In the first half of 2016, we made several significant advancements towards the operating objectives for our dual technology platforms of immuno-oncology and stem cells,” commented Tony (Bizuo) Liu, CBMG’s Chief Executive Officer. “The completion of a $43.13 million strategic investment has strengthened our capabilities to continue to invest in research and development, optimize our clinical process and expand our focus on the CAR-T pipeline. We anticipate in the coming quarters launching clinical trials in China on CAR-T CD19 and CD20 constructs and to further bolster our immuno-oncology pipeline. We have completed patient treatment in the Phase I trial of AlloJoinTM, our off-the-shelf allogeneic adipose-derived progenitor cell (haMPC) therapy for Knee Osteoarthritis (KOA) in China, and are encouraged to see no serious adverse events thus far. We continue to evaluate the feasibility of initiating a clinical study of AlloJoinTM under IND to support the same indication in the United States. As we look forward to the remainder of 2016, we will continue to prioritize our immuno-oncology and stem cell clinical pipelines for multiple indications that serve large addressable markets while facilitating future partnerships and collaborations that will enhance our ability to develop safe and effective therapies.”
Second Quarter and First Half 2016 Financial Performance
1. Cash Position: Cash and cash equivalents as of June 30, 2016 were $47.5 million compared to $14.9 million as of December 31, 2015. This increase was due to a private placement financing in February and April 2016 for gross proceeds of approximately $43 million, offset by cash used in operating and investment activities.
2. Net Cash Used in Operating Activities: Net cash used in operating activities for the quarter and six months ended June 30, 2016 was $5.2 million and $8.8 million, respectively, compared to $3.3 million and $5.7 million for the same periods in 2015.
3. G&A Expenses: General and administrative expenses for the quarter and six months ended June 30, 2016 were $3.1 million and $5.8 million, respectively, compared to $3.8 million and $6.4 million for the same periods in 2015.
4. R&D Expenses: Research and development expenses for the quarter and six months ended June 30, 2016 were $3 million and $5.4 million respectively, compared to $1.3 million and $2.8 million for the same periods in 2015. The increase of R&D costs was primarily attributed to:
5. Net Loss: Net loss allocable to common stock holders for the quarter and six months ended June 30, 2016 was $7.2 million and $11.4 million respectively, compared to $5 million and $9.3 million for the same periods in 2015. Changes in net loss are primarily attributable to changes in operations of our biomedicine segment, which are described above.
Recent Business and Technology Highlights
- Completed treatment for eighteen patients in Phase I trial of AlloJoinTM haMPC therapy for Knee Osteoarthritis (KOA);
- China Patent Office granted the Company’s patent application on genetically engineered anti-CD20 Chimeric Antigen Receptor-positive NKT cells, its production and application;
- Advanced the Company’s cash position following the closing of an agreement with Wuhan Dangdai Science & Technology Industries Group Inc. to invest an aggregate of $43.13 million for 2.27 million shares of the Company’s common stock, representing a 16.2% post-money stake investment as of April 15, 2016;
- Appointment of Dr. Zhou Hansheng as a member of the Board of Directors.
Pipeline Update
- Conducted single-center Phase I trial of AlloJoinTM haMPC therapy for Knee Osteoarthritis (KOA) in China
- Eighteen patients have received two dose intra-articular injections at three week intervals and have not been presented with any serious adverse events thus far
- Patients will be monitored over the next 12 months for safety and efficacy signs
- Phase I clinical research trial for AlloJoin™ is registered at ClinicalTrials.gov under the number NCT02641860
- Anticipate announcement of sponsorship of multi-indication clinical studies with multiple institutions using CBMG’s CD19 and CD20 constructs and stem cell technologies by Q12017 after the technologies are optimized and manufacturing capabilities are in place
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 nine 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.
| CELLULAR BIOMEDICINE GROUP, INC. | ||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS | ||||||||||||||||
| (UNAUDITED) | ||||||||||||||||
| For the Three Months Ended | For the Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2016 | 2015 | 2016 | 2015 | |||||||||||||
| Net sales and revenue | $ | 71,599 | $ | 656,959 | $ | 560,090 | $ | 1,260,349 | ||||||||
| Operating expenses: | ||||||||||||||||
| Cost of sales | 323,587 | 398,229 | 826,780 | 892,291 | ||||||||||||
| General and administrative | 3,072,647 | 3,768,535 | 5,848,572 | 6,448,772 | ||||||||||||
| Selling and marketing | 39,480 | 161,219 | 218,234 | 310,241 | ||||||||||||
| Research and development | 2,972,855 | 1,322,692 | 5,371,217 | 2,778,112 | ||||||||||||
| Impairment of investments | - | - | - | 123,428 | ||||||||||||
| Total operating expenses | 6,408,569 | 5,650,675 | 12,264,803 | 10,552,844 | ||||||||||||
| Operating loss | (6,336,970 | ) | (4,993,716 | ) | (11,704,713 | ) | (9,292,495 | ) | ||||||||
| Other income (expense): | ||||||||||||||||
| Interest income | 18,290 | 5,920 | 35,340 | 21,031 | ||||||||||||
| Other income (expense) | 7,646 | 13,523 | 23,966 | 10,820 | ||||||||||||
| Total other income | 25,936 | 19,443 | 59,306 | 31,851 | ||||||||||||
| Loss before taxes | (6,311,034 | ) | (4,974,273 | ) | (11,645,407 | ) | (9,260,644 | ) | ||||||||
| Income taxes credit (provision) | (886,248 | ) | (52,202 | ) | 238,012 | (53,002 | ) | |||||||||
| Net loss | $ | (7,197,282 | ) | $ | (5,026,475 | ) | $ | (11,407,395 | ) | $ | (9,313,646 | ) | ||||
| Other comprehensive income (loss): | ||||||||||||||||
| Cumulative translation adjustment | (271,438 | ) | 42,236 | (255,365 | ) | 61,845 | ||||||||||
| Unrealized gain (loss) on investments, net of tax | (11,115,884 | ) | 10,631,731 | 5,300,633 | 8,063,460 | |||||||||||
| Total other comprehensive income (loss): | (11,387,322 | ) | 10,673,967 | 5,045,268 | 8,125,305 | |||||||||||
| Comprehensive gain (loss) | $ | (18,584,604 | ) | $ | 5,647,492 | $ | (6,362,127 | ) | $ | (1,188,341 | ) | |||||
| Net loss per share : | ||||||||||||||||
| Basic | $ | (0.52 | ) | $ | (0.44 | ) | $ | (0.89 | ) | $ | (0.83 | ) | ||||
| Diluted | $ | (0.52 | ) | $ | (0.44 | ) | $ | (0.89 | ) | $ | (0.83 | ) | ||||
| Weighted average common shares outstanding: | ||||||||||||||||
| Basic | 13,737,722 | 11,531,497 | 12,810,894 | 11,286,712 | ||||||||||||
| Diluted | 13,737,722 | 11,531,497 | 12,810,894 | 11,286,712 | ||||||||||||
| CELLULAR BIOMEDICINE GROUP, INC. | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| (UNAUDITED) | ||||||||
| June 30, | December 31, | |||||||
| 2016 | 2015 | |||||||
| Assets | ||||||||
| Cash and cash equivalents | $ | 47,470,196 | $ | 14,884,597 | ||||
| Accounts receivable, less allowance for doubtful amounts of $10,782 | ||||||||
| and $nil as of June 30, 2016 and December 31, 2015, respectively | 330,860 | 630,332 | ||||||
| Other receivables | 245,073 | 271,344 | ||||||
| Inventory | 313,837 | 390,886 | ||||||
| Prepaid expenses | 811,403 | 367,050 | ||||||
| Taxes recoverable | - | 150,082 | ||||||
| Total current assets | 49,171,369 | 16,694,291 | ||||||
| Investments | 11,211,137 | 5,379,407 | ||||||
| Property, plant and equipment, net | 3,204,157 | 2,768,900 | ||||||
| Goodwill | 7,678,789 | 7,678,789 | ||||||
| Intangibles, net | 15,018,223 | 15,949,100 | ||||||
| Long-term prepaid expenses and other assets | 1,256,973 | 989,935 | ||||||
| Total assets | $ | 87,540,648 | $ | 49,460,422 | ||||
| Liabilities and Stockholders' Equity | ||||||||
| Liabilities: | ||||||||
| Accounts payable | $ | 136,355 | $ | 260,886 | ||||
| Accrued expenses | 457,392 | 845,087 | ||||||
| Taxes payable | 30,000 | - | ||||||
| Other current liabilities | 1,574,592 | 1,913,284 | ||||||
| Total current liabilities | 2,198,339 | 3,019,257 | ||||||
| Deferred tax liabilities | 288,830 | - | ||||||
| Other non-current liabilities | 25,636 | 76,229 | ||||||
| Total liabilities | 2,512,805 | 3,095,486 | ||||||
| Commitments and Contingencies | ||||||||
| Stockholders' equity: | ||||||||
| Preferred stock, par value $.001, 50,000,000 shares | ||||||||
| authorized; none issued and outstanding as of | ||||||||
| June 30, 2016 and December 31, 2015, respectively | - | - | ||||||
| Common stock, par value $.001, 300,000,000 shares authorized; | ||||||||
| 14,099,228 and 11,711,645 issued and outstanding | ||||||||
| as of June 30, 2016 and December 31, 2015, respectively | 14,099 | 11,711 | ||||||
| Additional paid in capital | 148,830,297 | 103,807,651 | ||||||
| Accumulated deficit | (68,745,706 | ) | (57,338,311 | ) | ||||
| Accumulated other comprehensive income (loss) | 4,929,153 | (116,115 | ) | |||||
| Total stockholders' equity | 85,027,843 | 46,364,936 | ||||||
| Total liabilities and stockholders' equity | $ | 87,540,648 | $ | 49,460,422 | ||||
| CELLULAR BIOMEDICINE GROUP, INC. | ||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
| For the Six Months Ended | ||||||||
| June 30, | ||||||||
| 2016 | 2015 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net loss | $ | (11,407,395 | ) | $ | (9,313,646 | ) | ||
| Adjustments to reconcile net loss to net cash | ||||||||
| used in operating activities: | ||||||||
| Depreciation and amortization | 1,349,137 | 928,531 | ||||||
| Stock based compensation expense | 2,412,261 | 3,618,050 | ||||||
| Other than temporary impairment on investments | - | 123,428 | ||||||
| Realized losses from sale of investments | - | 5,178 | ||||||
| Inventory provision | 105,919 | - | ||||||
| Allowance for doubtful account | 10,782 | - | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | 275,333 | (304,173 | ) | |||||
| Other receivables | 20,521 | (222,716 | ) | |||||
| Inventory | (25,309 | ) | (27,839 | ) | ||||
| Prepaid expenses | (457,032 | ) | (8,427 | ) | ||||
| Taxes recoverable | 150,082 | - | ||||||
| Other current assets | - | 110,347 | ||||||
| Long-term prepaid expenses and other assets | (259,624 | ) | (73,031 | ) | ||||
| Accounts payable | (124,531 | ) | (320,305 | ) | ||||
| Accrued expenses | (387,695 | ) | 112,026 | |||||
| Advances payable to related party | - | (30,216 | ) | |||||
| Other current liabilities | (152,605 | ) | 88,991 | |||||
| Taxes payable | 30,000 | (173,739 | ) | |||||
| Deferred tax liabilities | (242,267 | ) | - | |||||
| Other non-current liabilities | (50,049 | ) | (212,265 | ) | ||||
| Net cash used in operating activities | (8,752,472 | ) | (5,699,806 | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Proceed from sale of investments, net of issuance cost paid | - | 1,480 | ||||||
| Purchases of intangibles | - | (4,385,940 | ) | |||||
| Purchases of assets | (1,161,568 | ) | (224,826 | ) | ||||
| Net cash used in investing activities | (1,161,568 | ) | (4,609,286 | ) | ||||
| 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 | 175,399 | 234,599 | ||||||
| Net cash provided by financing activities | 42,612,773 | 19,199,448 | ||||||
| EFFECT OF EXCHANGE RATE CHANGES ON CASH | (113,134 | ) | (9,856 | ) | ||||
| INCREASE IN CASH AND CASH EQUIVALENTS | 32,585,599 | 8,880,500 | ||||||
| CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 14,884,597 | 14,770,584 | ||||||
| CASH AND CASH EQUIVALENTS, END OF PERIOD | $ | 47,470,196 | $ | 23,651,084 | ||||
| SUPPLEMENTAL CASH FLOW INFORMATION | ||||||||
| Cash paid for income taxes | $ | (6,705 | ) | $ | (226,855 | ) | ||
| Non-cash investing activities | ||||||||
| Acquisition of intangible assets through issuance of the Company's stock | $ | - | $ | 1,096,399 | ||||