Precigen Reports Second Quarter and First Half 2020 Financial Results

On August 10, 2020 Precigen, Inc. (Nasdaq: PGEN), a biopharmaceutical company specializing in the development of innovative gene and cell therapies to improve the lives of patients, reported second quarter and first half financial results for 2020 (Press release, Precigen, AUG 10, 2020, View Source [SID1234563369]).

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Business Highlights:

UltraPorator: Precigen advanced the development of its proprietary electroporation device, UltraPorator, including the initiation of both the manufacturing of a cGMP-compliant system and the process of technology transfer to its clinical sites. UltraPorator is a semi-closed, high-throughput system with a proprietary hardware and software solution designed to significantly reduce processing time and contamination risk, limitations of other electroporation devices and hurdles to the viable scale-up and commercialization of certain therapeutic programs. The Company expects to implement the system at multiple medical centers for the expansion phases of PRGN-3005, PRGN-3006 and the future UltraCAR-T clinical trials;
PRGN-3005 UltraCAR-T: Precigen initiated the dosing of patients in the third dose level of the intraperitoneal (IP) arm of the Phase 1 clinical trial of PRGN-3005 UltraCAR-T for treatment of advanced, recurrent platinum resistant ovarian, fallopian tube or primary peritoneal cancer (clinical trial identifier: NCT03907527). Preclinical data for PRGN-3005 UltraCAR-T presented at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Virtual Annual Meeting II demonstrated significantly superior expansion, persistence and preferred memory phenotype of UltraCAR-T in vivo and significantly superior efficacy in an ovarian cancer model compared to traditional CAR-T;
AG019 ActoBiotics: Precigen ActoBio, Inc., a wholly-owned subsidiary of Precigen, announced the Phase 1b monotherapy portion of the ongoing Phase 1b/2a clinical trial for investigational therapy AG019 ActoBiotics met the primary endpoint assessing safety and tolerability in patients with early-onset type 1 diabetes (T1D) (clinical trial identifier: NCT03751007, EudraCT 2017-002871-24). The Phase 1b portion of the study evaluates safety and tolerability of 2 different doses of AG019 monotherapy, a capsule formulation composed of ActoBiotics delivering the autoantigen human proinsulin (hPINS) and the tolerance-enhancing cytokine human interleukin-10 (hIL-10). Preliminary results demonstrate an encouraging trend in C-peptide levels, a biomarker for T1D disease progression, as well as, an increase in the frequency of islet-specific Tregs, a potential mechanistic indicator of therapeutic activity; and
INXN-4001: Precigen Triple-Gene, a majority-owned subsidiary of Precigen, announced six-month follow-up data from the Phase I trial of INXN-4001 (clinical trial identifier: NCT03409627), a multigenic, non-viral, plasmid-based investigational therapeutic candidate under evaluation for the treatment of heart failure. The study met the primary endpoints to evaluate safety and feasibility for INXN-4001. INXN-4001, delivered via retrograde coronary sinus infusion (RCSI), was well-tolerated. Preliminary data suggest an overall improvement in patient reported outcomes in 50% of patients six months after treatment;
Second Quarter 2020 Financial Highlights:

Total revenues of $30.4 million;
Net loss of $43.4 million, or $(0.26) per basic share, of which $31.7 million was for non-cash charges; and
Cash, cash equivalents, and short-term investments totaled $133.0 million at June 30, 2020.
First Half 2020 Financial Highlights:

Total revenues of $60.3 million;
Net loss from continuing operations of $73.3 million, or $(0.45) per basic share, of which $40.4 million was for non-cash charges.
"Precigen has continued this quarter to streamline operations and focus efforts on delivering value to stakeholders through forward progress on our programs," said Helen Sabzevari, PhD, President and CEO of Precigen. "In the clinic, we recently announced encouraging data from the AG019 Phase 1b monotherapy study in Type 1 diabetes and the INXN-4001 Phase I study of patients with chronic heart failure and expect additional results on these and other clinical programs in the coming months. Additionally, we are pleased to announce our proprietary UltraPorator manufacturing device, which we believe sets Precigen on the path to commercial viability for rapid decentralized manufacturing of UltraCAR-T at multiple medical centers."

Second Quarter 2020 Financial Results Compared to Prior Year Period

Total revenues declined $2.4 million from the quarter ended June 30, 2019 primarily due to a decline in Precigen’s collaboration and licensing revenues as the Company continues to transition from a collaboration business model to a model where the Company develops and advances its most valuable healthcare products on its own. While Trans Ova’s revenues were comparable period over period, gross margins on their products and services increased $1.3 million over the comparable prior quarter as a result of the implementation of operational efficiencies gained through improved inventory management, reduction in workforce, and lower royalty rates on certain licensed technologies.

Research and development expenses decreased $14.0 million, or 50%, from the quarter ended June 30, 2019. Salaries, benefits, and other personnel costs decreased $4.8 million as Precigen suspended the operations of its MBP Titan subsidiary in the second quarter. Precigen’s research and development expenses for third-party vendors decreased $7.8 million primarily as a result of the suspension of its MBP Titan operations and also depriortized certain internal programs at its ActoBio subsidiary in the fourth quarter of 2019. Selling, general and administrative (SG&A) expenses decreased $0.5 million and include a decrease of $4.0 million in fees paid to third-party vendors as well as a reduction in salaries and benefits for corporate employees as Precigen reduced its corporate headcount by 25% from December 31, 2019 to June 30, 2020 as it scaled down the Company’s corporate functions to support a more streamlined organization. These decreases were partially offset by an increase in compensation costs which primarily resulted from stock compensation expenses related to equity grants made in the first quarter of 2020 and one-time severance costs for terminated employees. In conjunction with the suspension of MBP Titan’s operations in the second quarter of 2020, Precigen recorded $22.0 million in non-cash impairment charges related to the write-down of goodwill and long-lived assets.

First Half 2020 Financial Results Compared to Prior Year Period

Total revenues increased $4.8 million over the six months ended June 30, 2019 primarily due to an increase in Precigen’s collaboration and licensing revenues as the Company accelerated the recognition of previously deferred revenue upon the mutual termination of one of its collaboration agreements in February 2020. This increase was partially offset by a decrease in collaboration revenues related to other programs as Precigen continues to transition from a collaboration business model to a model where it develops and advances its most valuable healthcare programs on its own. Trans Ova’s revenues increased $1.3 million over the six months ended June 30, 2019 primarily due to an increase in services performed and the expansion of its commercial dairy business. Gross margins on their products and services increased $4.6 million over the comparable prior period as a result of the implementation of operational efficiencies gained through improved inventory management, reduction in workforce, and lower royalty rates on certain licensed technologies.

Research and development expenses decreased $22.1 million, or 40%, from the six months ended June 30, 2019. Salaries, benefits, and other personnel costs decreased $6.9 million as Precigen suspended the operations of its MBP Titan subsidiary in the second quarter. Precigen’s research and development expenses for third-party vendors decreased $12.8 million primarily as a result of the suspension of its MBP Titan operations and also depriortized certain internal programs at its ActoBio subsidiary in the fourth quarter of 2019. SG&A expenses decreased $8.5 million and include a decrease of $7.9 million in fees paid to third-party vendors as well as a reduction in salaries and benefits for corporate employees as Precigen reduced its corporate headcount by 25% from December 31, 2019 to June 30, 2020 as it scaled down its corporate functions to support a more streamlined organization. These decreases were partially offset by an increase in compensation costs which primarily resulted from stock compensation expenses related to equity grants made in the first quarter of 2020 and one-time severance costs for terminated employees. In conjunction with the suspension of MBP Titan’s operations in the second quarter of 2020, Precigen recorded $22.0 million of noncash impairment charges related to the write-down of goodwill and long-lived assets.

Conference Call and Webcast

Precigen will host a conference call today, Monday, August 10th at 4:30 PM ET to discuss the results and provide a general business update. The conference call may be accessed by dialing 1-888-317-6003 (Domestic US), 1-866-284-3684 (Canada) or 1-412-317-6061 (International) and providing the number 6003292 to join the Precigen Conference Call. Participants are asked to dial in 10-15 minutes in advance of the scheduled call time to facilitate timely connection to the call. Participants may also access the live webcast through Precigen’s website in the Events section at View Source

AMN Healthcare Announces Upsize and Pricing of Senior Notes Offering

On August 10, 2020 AMN Healthcare Services, Inc. (NYSE: AMN), reported that its wholly owned subsidiary, AMN Healthcare, Inc. (the "Issuer"), priced its private offering of an additional $200 million aggregate principal amount of 4.625% Senior Notes due 2027, which represents an increase of $50 million from the aggregate principal amount previously disclosed (the "New Notes") (Press release, AMN Healthcare Services, AUG 10, 2020, View Source [SID1234563368]). The New Notes will be issued at 101.00% of their face value. The New Notes will be issued under the existing indenture, dated as of October 1, 2019, under which the Issuer previously issued $300 million aggregate principal amount of its 4.625% Senior Notes due 2027. The New Notes will be guaranteed by the Company’s affiliates that guarantee the Company’s credit facilities ("Credit Facilities").

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The Issuer intends to use the proceeds from the private offering to (i) repay a portion of the existing term loan indebtedness under the Credit Facilities and (ii) pay fees and expenses related to the offering.

The offering is expected to close August 13, 2020, subject to satisfaction of customary closing conditions.

The New Notes will be offered only to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933 (as amended, the "Securities Act") and to non-U.S. persons outside of the United States in compliance with Regulation S under the Securities Act. The New Notes will not be registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

Titan Pharmaceuticals To Report Second Quarter 2020 Financial Results On August 14, 2020

On August 10, 2020 Titan Pharmaceuticals, Inc. (NASDAQ: TTNP) reported that its second quarter 2020 financial results will be released on Friday, August 14, 2020 (Press release, Titan Pharmaceuticals, AUG 10, 2020, View Source [SID1234563367]).

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Titan will host a live conference call to discuss the financial results and provide a general business review the same day, August 14, 2020, at 9:00 a.m. PT / 12:00 p.m. ET. The call will be hosted by Sunil Bhonsle, president and CEO; Kate Beebe DeVarney, Ph.D., executive vice president and chief scientific officer; Brian Crowley, vice president of finance; Joe Schrei, executive director, commercial operations; Mike Fritz, national sales director; and Marc Rubin, M.D., executive chairman. A summary of the second quarter financial results and other highlights will be included in a press release to be issued prior to the call.

The live webcast and a replay of the call may be accessed by visiting View Source The call can also be accessed by dialing 1-888-317-6003 (or 1-412-317-6061 from outside the U.S.) ten minutes prior to the start time, and providing passcode 8493149.

Sutro Biopharma to Present at the 2020 Wedbush PacGrow Healthcare Virtual Conference

On August 10, 2020 Sutro Biopharma, Inc. (NASDAQ: STRO), a clinical-stage drug discovery, development and manufacturing company focused on the application of precise protein engineering and rational design to create next-generation oncology therapeutics, reported that Bill Newell, Chief Executive Officer, will present at the 2020 Wedbush PacGrow Healthcare Virtual Conference on Tuesday, August 11, 2020 at 11:30 a.m. EDT / 8:30 a.m. PDT (Press release, Sutro Biopharma, AUG 10, 2020, View Source [SID1234563366]).

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A live webcast of the presentation will be accessible through the Events and Presentations page of the Investor Relations section on the company’s website at www.sutrobio.com. A replay of the webcast will be available following the event for approximately 30 days.

Omeros Announces Proposed Public Offerings of Common Stock and Convertible Senior Notes

On August 10, 2020 Omeros Corporation (Nasdaq: OMER) ("Omeros") reported that it has commenced concurrent underwritten public offerings of $125,000,000 of shares of its common stock (the "Shares") and $200,000,000 aggregate principal amount of convertible senior notes due 2026 (the "2026 Convertible Notes") (Press release, Omeros, AUG 10, 2020, View Source [SID1234563365]). In addition, Omeros has granted to the underwriters of the offering of Shares (the "Equity Offering") a 30-day option to purchase up to an additional $18,750,000 of Shares and to the underwriters of the offering of 2026 Convertible Notes (the "Notes Offering") a 30-day option, solely to cover over-allotments, to purchase up to an additional $30,000,000 aggregate principal amount of 2026 Convertible Notes. The offerings are subject to market and other conditions, and there can be no assurance as to whether or when the offerings may be completed or as to the actual size or terms of the offerings. Neither offering is contingent on the completion of the other offering.

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BofA Securities and JP Morgan are acting as the book-running managers for each of the offerings.

The 2026 Convertible Notes will mature on February 15, 2026, unless earlier converted, repurchased or redeemed in accordance with their terms, and will be convertible, subject to the satisfaction of certain conditions, into cash, shares of Omeros’ common stock or a combination thereof as elected by Omeros in its sole discretion. The 2026 Convertible Notes will be senior unsecured obligations of Omeros. Interest will be payable on the 2026 Convertible Notes semi-annually in arrears. Omeros will have the right to redeem the 2026 Convertible Notes on or after August 15, 2023, subject to certain conditions and limitations. Final terms of the 2026 Convertible Notes, including the interest rate, initial conversion rate and other terms, will be determined upon pricing of the Notes Offering.

Omeros intends to use a portion of the net proceeds of the Notes Offering to fund the cost of entering into capped call transactions with the option counterparties, as described below. In addition, Omeros intends to use a portion of the net proceeds of the Notes Offering to repurchase a portion of its existing 6.25% Convertible Senior Notes due 2023 (the "2023 Convertible Notes") in privately negotiated transactions as described below.

Omeros intends to use the net proceeds from the Equity Offering and the remainder of the net proceeds from the Notes Offering, if any, for general corporate purposes, including funding clinical trials, pre-clinical studies, manufacturing, build-out of commercial infrastructure and other costs associated with advancing its development programs and product candidates toward regulatory submissions and potential commercialization.

In connection with the pricing of the 2026 Convertible Notes, Omeros expects to enter into one or more privately negotiated capped call transactions with one or more financial institutions ("option counterparties"). The capped call transactions are intended to reduce the potential dilution with respect to Omeros’ common stock or, at its election (subject to certain conditions), offset potential cash payments in excess of the principal amount of the converted 2026 Convertible Notes, upon conversion of the 2026 Convertible Notes, with such reduction or offset subject to a cap. If the underwriters exercise their option to purchase additional 2026 Convertible Notes, Omeros expects to enter into additional capped call transactions with the option counterparties.

Omeros has been informed that in connection with establishing their initial hedges of the capped call transactions, the option counterparties and/or their affiliates expect to purchase shares of Omeros’ common stock and/or enter into various derivative transactions with respect to Omeros’ common stock concurrently with or shortly after the pricing of the 2026 Convertible Notes. This activity could increase (or reduce the size of any decrease in) the market price of Omeros’ common stock or the 2026 Convertible Notes at that time.

In addition, the option counterparties and/or their affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect to Omeros’ common stock and/or purchasing or selling Omeros’ common stock or other securities of Omeros’ in secondary market transactions following the pricing of the 2026 Convertible Notes and prior to the maturity of the 2026 Convertible Notes (and are likely to do so on each exercise date of the capped call transactions, which are expected to occur during the 50-trading day period beginning on the 51st scheduled trading day prior to the maturity date of the notes, or following any termination of any portion of the capped call transactions in connection with any repurchase, redemption or conversion of the 2026 Convertible Notes if Omeros makes the relevant election under the capped call transactions). This activity could also cause or avoid an increase or a decrease in the market price of Omeros’ common stock or the 2026 Convertible Notes, which could affect a noteholder’s ability to convert the 2026 Convertible Notes and, to the extent the activity occurs during any observation period related to a conversion of the 2026 Convertible Notes, could affect the amount and value of the consideration that a noteholder will receive upon conversion of the 2026 Convertible Notes.

Concurrently with the Notes Offering, Omeros expects to use a portion of the proceeds from the offering to repurchase a portion of its outstanding 2023 Convertible Notes in privately negotiated transactions. Omeros expects that holders of the 2023 Convertible Notes that sell their 2023 Convertible Notes to Omeros in any note repurchase transaction may enter into or unwind various derivatives with respect to Omeros’ common stock and/or purchase or sell shares of Omeros’ common stock in the market to hedge their exposure in connection with these transactions. This activity could increase (or reduce the size of any decrease in) the market price of Omeros’ common stock or the 2026 Convertible Notes at that time and could result in a higher effective conversion price for the 2026 Convertible Notes.

In connection with any repurchase of the 2023 Convertible Notes, Omeros expects to terminate, concurrently with or shortly after the pricing of the notes, a portion of the existing capped call transaction (the "existing capped call transaction") that Omeros entered into with a financial institution (the "existing option counterparty") when the 2023 Convertible Notes were issued in a notional amount corresponding to the amount of such 2023 Convertible Notes repurchased, if any. In connection with any termination of the existing capped call transaction and the related unwinding of the existing hedge position of the existing option counterparty with respect to such transaction, the existing option counterparty and/or its respective affiliates are expected to sell shares of Omeros’ common stock in secondary market transactions, and/or enter into or unwind various derivative transactions with respect to Omeros’ common stock. This activity could decrease (or reduce the size of any increase in) the market price of Omeros’ common stock or the 2026 Convertible Notes at that time and could result in a lower effective conversion price for the 2026 Convertible Notes.

The Equity Offering and the Notes Offering are being made pursuant to Omeros’ shelf registration statement on Form S-3 (File No. 333-235349) including the base prospectus contained therein, a preliminary prospectus supplement related to the Equity Offering (together with such base prospectus, the "Equity Prospectus") and a preliminary prospectus supplement related to the Notes Offering (together with such base prospectus, the "Notes Prospectus"), all of which Omeros filed or will file with the Securities and Exchange Commission ("SEC"). Before investing in the Shares or the 2026 Convertible Notes, investors should read the Equity Prospectus and the Notes Prospectus, respectively, in each case, including the documents incorporated by reference therein, and any free writing prospectus related to the Equity Offering and the Notes Offering, as the case may be. These documents may be freely obtained by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, copies may be obtained, when available, from BofA Securities, NC1-004-03-43, 200 North College Street, 3rd floor, Charlotte, NC 28255-0001, Attn: Prospectus Department, or via email: [email protected] and J.P. Morgan Securities LLC, Attention: Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, by telephone at (866) 803-9204, or by e-mail at [email protected].