Athersys, Inc. (NASDAQ:ATHX) announced its financial results for the fourth quarter and year ended December 31, 2015.
“Overall, we have made substantial progress over the past twelve months,” said Gil Van Bokkelen, Chairman and Chief Executive Officer of Athersys. “We have seen that MultiStem® treatment has the potential to help ischemic stroke victims, especially those who can be treated within 36 hours following the stroke. We have identified a promising path forward for continued development through a new partnership in Japan that is well positioned to take advantage of Japan’s progressive regulations for the development and approval of regenerative medicine products. Furthermore, we have continued to make progress in our other programs, strengthening the underlying science and our core capabilities, including manufacturing.”
Highlights of the fourth quarter of 2015 and recent events include:
- Announced in February at the 2016 International Stroke Conference positive results from analysis of one-year follow-up data from the Phase 2 study of MultiStem cell therapy to treat ischemic stroke – demonstrating progressive improvements and significantly higher rate of excellent outcomes at one year for MultiStem-treated patients;
- Established a collaboration with HEALIOS K.K. (“Healios”) in January 2016 to develop MultiStem cell therapy for stroke in Japan, receiving an upfront license fee of $15 million. Collaboration includes potential for development and commercialization milestones aggregating $215 million and royalties on product sales. Healios may expand the collaboration to include acute respiratory distress syndrome (“ARDS”) and another indication with a $10 millionexpansion payment and associated milestone payments and royalties;
- Initiated enrollment in a Phase 2a study evaluating administration of MultiStem therapy to ARDS patients, and continued enrollment of a Phase 2 acute myocardial infarction (“AMI”) study;
- Published the results of a preclinical study in the Journal of Neuroinflammation demonstrating that MultiStem therapy provides significant benefit in a large animal model of hypoxic-ischemia, and providing further evidence in support of MultiStem treatment for acute neurological injuries;
- Published in Nature‘s Scientific Reports the results of a preclinical acute spinal cord injury study demonstrating that MultiStem therapy promoted improved walking and urinary function, preserved at-risk neuronal tissue, and modulated inflammation following the injury;
- Received Special Protocol Assessment designation from the Food and Drug Administration and positive opinion from European Medicines Agency through its Scientific Advice procedure regarding the registration study design for Phase 2/3 trial of MultiStem cell therapy to prevent or reduce graft-versus-host disease and other complications for patients undergoing a hematopoietic stem cell transplant to treat leukemia or related conditions;
- For quarter ended December 31, 2015, recorded revenues of $10.6 million, reflecting the recognition of $10 millionlicense fee payment upon termination of the collaboration with Chugai Pharmaceutical Co, Ltd. (“Chugai”), and net income of $3.6 million; and for year ended December 31, 2015, recorded revenues of $11.9 million and net loss of$16.4 million; and
- Ended year with $23.0 million in cash and cash equivalents, and received $15 million in January 2016 in connection with our Healios collaboration.
“We are very pleased with the ischemic stroke study’s one-year follow-up results for all subjects, which show that MultiStem treatment can significantly increase the number of patients who have an Excellent Outcome, meaning complete or nearly full recovery, when compared to standard of care,” stated Dr. Gil Van Bokkelen, Chairman & CEO at Athersys. “MultiStem treatment was also associated with improvement in other measures of function through one year, and as we expected, patients who received MultiStem treatment within 36 hours of the stroke did substantially better than placebo patients and subjects receiving later treatment with MultiStem. Based on our interim 90-day data and these one-year results, we are excited to move forward with clinical development focused on MultiStem treatment within 36 hours of the stroke, and we believe that such treatment has the potential to substantially improve patient outcomes following ischemic stroke.”
“We are actively working with Healios in Japan on the development of MultiStem therapy for treatment of ischemic stroke, and we are both very engaged on planning for a trial in Japan,” continued Dr. Van Bokkelen. “The company has an accomplished leadership team, an excellent network of institutional partners and collaborators, and is focused on the regenerative medicine field. They are committed to rapid and efficient development under the new regulatory framework in Japan, which has the potential to provide the fastest path to market for our MultiStem stroke program.”
“Since last year, we have initiated two grant-supported Phase 2 trials, in AMI and ARDS, both of which represent areas of unmet need,” commented Dr. Van Bokkelen. “We believe that MultiStem cell therapy is well-suited to treat these acute conditions, based on our preclinical and clinical experience to date. Additionally, we have been focused on advancing our manufacturing platform and related capabilities to support late stage clinical development and, eventually, commercialization.”
Fourth Quarter Results
For the three months ended December 31, 2015, total revenues were $10.6 million compared to $0.2 million in the same period in 2014, reflecting the recognition of the full $10 million license fee that we received in 2015 from Chugai upon the termination of the collaboration in October 2015 and an increase in grant revenue.
Research and development expenses decreased to $5.3 million in the fourth quarter of 2015 from $5.6 million in the 2014 fourth quarter, primarily due to reduced clinical and preclinical development costs, which vary based on trials underway and clinical manufacturing campaigns. General and administrative expenses were $1.8 million in the fourth quarter of 2015 compared to $1.6 million in the corresponding 2014 period, reflecting increases in legal and professional fees, personnel costs and stock-based compensation.
We recognized net income for the three months ended December 31, 2015 of $3.6 million, compared to net loss of $6.6 millionfor the same period of 2014. The $10.2 million net variance includes the impact of the $10 million Chugai license fee, the $0.4 million increase in grant revenues, the $0.3 million decrease in research and development expenses, the $0.2 million increase in general and administrative costs, and an increase in net other expenses.
2015 Annual Financial Results
For the year ended December 31, 2015, total revenues were $11.9 million compared to $1.6 million for 2014, reflecting the $10 million Chugai license fee and an increase in grant revenue.
Research and development expenses decreased to $21.3 million in 2015 from $23.4 million in 2014 related primarily to decreases in clinical and preclinical development costs, sponsored research costs, legal and professional fees and travel costs, with such decreases partially offset increases in license fees and personnel costs. General and administrative expenses were$7.5 million in 2015 compared to $6.9 million in 2014, reflecting increases in stock-based compensation, professional fees and consulting costs.
Net loss for the year ended December 31, 2015 was $16.4 million, compared to $22.1 million in 2014. The difference of $5.7 million reflects the $10.3 million increase in revenues, the $2.1 million decrease in research and development expenses, the$0.6 million increase in general and administrative costs, a $5.8 million non-cash decrease in the change in the fair value of our warrant liabilities, and an increase in net other expenses. Cash used in operating activities was $13.8 million and $25.8 millionin 2015 and 2014, respectively. As of December 31, 2015, we had $23.0 million in cash and cash equivalents. (Original Source)
Shares of Athersys climbed 6.5% in after-hours trading. ATHX has a 1-year high of $3.43 and a 1-year low of $0.90. The stock’s 50-day moving average is $1.47 and its 200-day moving average is $1.20.
On the ratings front, Athersys has been the subject of a number of recent research reports. In a report issued on February 17, Maxim Group analyst Jason Kolbert reiterated a Buy rating on ATHX, with a price target of $5, which represents a potential upside of 163.2% from where the stock is currently trading. Separately, on January 8, WBB’s Stephen Brozak maintained a Buy rating on the stock and has a price target of $9.
According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Jason Kolbert and Stephen Brozak have a total average return of -15.8% and 11.8% respectively. Kolbert has a success rate of 28.7% and is ranked #3690 out of 3694 analysts, while Brozak has a success rate of 47.8% and is ranked #599.
Athersys Inc is a biopharmaceutical company developing regenerative medicine. It is engaged in the discovery and development of therapies designed to extend and enhance human life.