On March 6, 2018 Cellular Biomedicine Group Inc. (NASDAQ:CBMG) ("CBMG" or the "Company"), a clinical-stage biopharmaceutical firm engaged in the development of immunotherapies for cancer and stem cell therapies for degenerative diseases, reported business highlights and financial results for the fiscal year ended December 31, 2017 (Press release, Cellular Biomedicine Group, MAR 6, 2018, View Source [SID1234524441]).
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"2017 was a pivotal year for CBMG and for the cell therapy environment. The U.S. Food and Drug Administration (FDA) had approved the first two chimeric antigen receptor T cell (CAR-T) therapies that use a patient’s own T cells to fight cancer. The issuance in December 2017 of China’s CFDA Guiding Principles for the Research and Evaluation of Cell Therapy Products provides a clear path for CBMG to advance our pipeline from clinical development to commercialization. We have initiated our CAR-T clinical trials and have been recruiting patients. We opened our new state-of-the-art GMP manufacturing facility in Shanghai’s Pharma Valley and signed strategic partnerships with GE Healthcare Life Sciences China and Thermo Fisher Scientific China to focus on improving manufacturing processes for cell therapies," said Tony (Bizuo) Liu, CEO of the Company. "These recent advancements, complete with existing in-house integrated Chemistry Manufacturing Controls ("CMC"), further our global leadership in cell therapy manufacturing and advance our goal to carry out transformative cancer treatment for patients. We have $48.9 million on hand at end of February 2018 to support our on-going clinical trials into 2019."
Tony Liu added, "We have also further strengthened our advisory team with the appointments of Dr. Michael A. Caligiuri, 2017-2018 President of American Association for Cancer Research (AACR) (Free AACR Whitepaper) ("AACR"), and President of City of Hope National Medical Center, as Chair of the company’s External Advisory Board and Dr. Robert S. Langer, Professor of The Koch Institute for Integrative Cancer Research at MIT, as a member of the Company’s Scientific Advisory Board."
2017 & Early 2018 Clinical and Facility Highlights
Immuno-Oncology Platform
●Commenced CALL-1 ("CAR-T against Acute Lymphoblastic Leukemia") Phase I clinical trial in China with CBMG’s optimized proprietary C-CAR011 construct of CD19 CAR-T therapy for the treatment of adult patients with Acute Lymphoblastic Leukemia ("ALL");
●Expanded the Phase I clinical trial in China of the Company’s ongoing CARD-1 ("CAR-T Against DLBCL") study in patients with Diffuse Large B-cell Lymphoma ("DLBCL");
●Sought to expand our efforts to develop therapies targeting solid tumors by acquiring a three-year option to license T-cell Receptor ("TCR") technology in Hepatocellular Carcinoma ("HCC").
Stem Cell Platform
●Completed 48-week follow-up of all patients in Phase I clinical trial of an "Off-the-Shelf" Allogeneic adipose-derived haMPC AlloJoinTM therapy for the treatment of Knee Osteoarthritis (KOA) patients in China;
●Awarded $2.29 million by the California Institute for Regenerative Medicine (CIRM), to support pre-clinical studies of AlloJoinTM, CBMG’s "Off-the-Shelf" Allogeneic stem cell treatment for KOA in the United States.
GMP Expansion and Capabilities
●Expanded the Company’s cell therapy manufacturing capabilities with the opening of a new 100,000-square-foot, state-of-the-art GMP manufacturing facility located in Shanghai Zhangjiang High-Tech Park (Shanghai’s "Pharma Valley");
● Completed the expansion of a 30,000 square foot multipurpose facility in Wuxi, China, which will be dedicated to advanced stem cell culturing, centralized plasmid and viral vector production, cell banking and development of reagents;
● Established strategic partnership with GE Healthcare Life Sciences China to co-develop certain high-quality industrial control processes in CAR-T and stem cell manufacturing. A joint laboratory, named "CBMG-GE Joint Laboratory of Cell Therapy" using GE Healthcare’s FlexFactoryTM platform will be established within CBMG’s Shanghai GMP manufacturing facility and will be dedicated to the joint research and development of a functionally integrated and automated immunotherapy cell preparation system;
●Established a strategic partnership with Thermo Fisher Scientific China Ltd. to build a "CBMG-Thermo Fisher Scientific Joint Innovation & Application Center" which will focus on the research and development of an automated cell therapy manufacturing system.
Recent Business Highlights
●Advanced the Company’s cash position with two private placement transactions for total aggregate gross proceeds of approximately $45 Million;
●Sailing Capital, an institutional-quality, returns-focused private equity firm initiated by Shanghai International Group – the financial holding group of the Shanghai Municipal Government – became a significant investor in the Company.
Full Year 2017 Financial Results
Cash Position: The Company had working capital of $20.9 million as of December 31, 2017 compared to $38.3 million as of December 31, 2016. Cash position decreased to $21.6 million at December 31, 2017 compared to $39.3 million at December 31, 2016. We had an increase in cash used in operating and investing activities, partially offset by cash inflow generated from financing activities due to a private placement financing in 2017 for aggregate net proceeds of approximately $14.5 million.
Net Cash Used in Operating Activities: Full-year 2017 net cash used in operating activities was $18.6 million compared to $15.9 million in 2016. The 2017 change in operating assets and liabilities was primarily due to an increase in accounts receivable, other receivables and long-term prepaid expenses as well as the decrease in accrued expenses and non-current liabilities, netting of by the increase in other current liabilities.
Revenue: Full-year 2017 revenue was $0.3 million compared to $0.6 million in 2016. The majority of the revenue was derived from cell therapy technology service for the year ended December 31, 2017. The decrease in revenue is the result of prioritizing cancer therapeutic technologies, and focusing our clinical efforts on developing CAR-T technologies, Vaccine, Tcm and TCR clonality technologies.
G&A Expenses: Full-year 2017 general and administrative expenses were $12.8 million compared to $11.7 million in 2016. There was an increase in rental expenses of $2.2 million, which mainly resulted from the new leased plant located in the "Pharma Valley" of Shanghai from January 1, 2017.
R&D Expenses: Full-year 2017 research and development expenses were $14.6 million compared to $11.5 million in 2016. The increase was primarily attributed to an increase in rental expenses of $1,514,000, which was mainly attributed to the launching of R&D activities at our Beijing facility in the 2nd quarter of 2016 and the lease of a GMP facility in the United States to commence the KOA preclinical and clinical studies in 2017.
Net Loss: Full-year 2017 net loss allocable to common stock holders was $25.5 million compared to $28.2 million in 2016.