On November 12, 2021 Celularity Inc. (Nasdaq: CELU) ("Celularity"), a clinical-stage biotechnology company developing placental-derived allogeneic cell therapies, reported financial results for the third quarter ended September 30, 2021, and provided a corporate update (Press release, Celularity, NOV 12, 2021, View Source [SID1234595535]).
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"We have continued to make significant progress over the past months, including the establishment of multiple strategic collaborations to extend further the potential uses of our technology platform, with the goal of bringing potentially transformative therapeutics to patients who require them most," said Robert J. Hariri, M.D., Ph.D., Founder, Chairperson and Chief Executive Officer of Celularity. "Moreover, we have advanced multiple preclinical and clinical programs targeting significant unmet medical needs, including acute myeloid leukemia and glioblastoma. We believe we are well-positioned to continue executing our business strategy and developing cellular therapies for cancer, infectious and degenerative diseases that leverage our proprietary placental-based platform technology."
Third Quarter Corporate Highlights
Appointed Andrew L. Pecora, M.D., F.A.C.P., C.P.E., as President.
Entered into a research collaboration with Oncternal Therapeutics (Nasdaq: ONCT) to evaluate placental derived-cellular therapies targeting receptor-tyrosine kinase-like Orphan Receptor 1 (ROR1) in preclinical studies. The collaboration will initially explore the use of Oncternal’s ROR1-targeted chimeric antigen receptor (CAR) gene modification as part of Celularity’s CYNK natural killer cell and CyCART platforms. The partnership will also explore the use of monoclonal antibody, cirmtuzumab, in combination with Celularity’s CYNK natural killer cells.
Third Quarter 2021 Financial Results
Revenues for the three months ended September 30, 2021, increased $7.3 million compared to the prior year period. This was primarily due to an increase in license, royalty and other revenues driven by (i) recognition of previously deferred revenue as a result of the termination of the Sanuwave license agreement of $6.8 million, and (ii) revenues from supply and distribution agreements recognized during the third quarter of 2021 of $1.4 million, partially offset by a decrease in product sales and rentals revenues of $0.6 million resulting from the sale of the MIST/UltraMIST assets in August 2020.
Research and development expenses for the three months ended September 30, 2021, increased $12.5 million compared to the prior year period. The increase in research and development expenses was primarily due to higher stock-based compensation expense resulting from awards granted in connection with the consummation of the business combination as well as higher clinical trial costs related to Celularity’s CYNK-001 clinical trial and higher personnel costs.
Selling, general and administrative expenses for the three months ended September 30, 2021, increased $13.3 million compared to the prior year period, primarily due to higher stock-based compensation expense resulting from awards granted in connection with the consummation of the business combination, and a $5.3 million charge related to an estimated legal settlement and higher personnel costs.
Net income for the third quarter of 2021 was $49.9 million, or $0.47 per share (basic) and $0.40 per share (diluted).
Year to Date Financial Results
Revenue for the nine months ended September 30, 2021, increased $5.4 million compared to the prior year period. The increase was due to an increase of $9.1 million in license, royalty and other revenues primarily driven by (i) recognition of previously deferred revenue as a result of the termination of the Sanuwave license agreement of $6.8 million, and (ii) revenues from supply and distribution agreements recognized during the third quarter of 2021 of $1.4 million, partially offset by a decrease in product sales and rentals revenues of $3.6 million resulting from the sale of the MIST/UltraMIST assets in August 2020.
Research and development expenses for the nine months ended September 30, 2021, increased $24.9 million compared to the prior year period. The increase in research and development expenses was primarily due to higher stock-based compensation resulting from awards granted in connection with the consummation of the business combination, higher cell therapy process development and research expenses related to the CyCART-19 program, and higher personnel costs.
Selling, general and administrative expenses for the nine months ended September 30, 2021, increased $32.8 million compared to the prior year period, primarily due to higher stock-based compensation resulting from awards granted in connection with the consummation of the business combination , a charge related to an estimated legal settlement and higher personnel costs.
Net loss for the nine months ended September 30, 2021, was $96.1 million, or $2.00 per share (basic and diluted).