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Organovo Affirms Key Clinical Development Goals; Company Reports Fiscal Second-Quarter 2019 Results
- Pre-Investigational New Drug (“IND”) meeting with the
FDAexpected to be held in calendar 2019
- Second orphan designation anticipated in first half of calendar 2019
- Submit first IND in calendar 2020
“During the fiscal second quarter, we affirmed our key clinical development and operating goals,” said
Crouch continued, “We continue to generate favorable preclinical results in our liver therapeutic tissues program and will present data at next week’s Liver Meeting® on the performance of our tissues in an animal model of hereditary tyrosinemia Type 1 (“HT-1”). This rare disease is often characterized by severe liver damage and limited treatment options. In early studies in established animal models for HT-1, our tissues demonstrated engraftment, retention and functionality post-implantation, while also showing an improvement in the median survival rate for treated animals. Much like with Alpha-1 antitrypsin deficiency (“A1AT”), the same healthy tissue construct allows us to potentially treat a broad range of target indications. Our objective in implanting a healthy tissue patch is to restore function or offset the deficiency of a specific enzyme abnormality. Our ultimate goal, which we hope to evaluate in future studies, is delaying or reducing the need for a transplant.”
Crouch concluded, “We also continue to build upon our cell and in vitro tissue platform, including the launch of a new RNASeq data library by our Samsara division, and several custom projects for our liver tissue research services including disease modeling and toxicology.”
Key Clinical Development Goals & Outlook
- The Company continues to conduct supportive proof-of-concept studies in multiple orphan disease indications aimed at treating inborn errors of metabolism.
Organovoexpects to hold a pre-IND meeting with the FDAin calendar 2019 for its lead rare disease program.
- The Company believes that development of its healthy therapeutic liver tissue patch can treat a broad range of rare disease indications. The Company is pursuing a second orphan designation with the
FDA, which it now anticipates receiving in the first half of calendar 2019. Organovoplans to begin its IND-enabling toxicity study to support multiple indications including A1AT in the second half of calendar 2019.
- The Company expects to file for its first IND in calendar 2020.
Organovowill continue to opportunistically generate revenue to support its therapeutic research mission by leveraging its cell and in vitro tissue platform.
- Samsara Sciences, the Company’s wholly-owned subsidiary, recently launched a new product offering an RNA-Seq data library with matched sets of human liver tissues and cell types isolated from a range of healthy and diseased donors. This cost-effective solution enables customers to mine data for discovery and validation of disease and cell type-specific markers.
Organovoplans to continue expanding its global IP portfolio, which currently includes over 100 patents and pending applications.
- As of
September 30, 2018, the Company had a cash and cash equivalents balance of $37.4 million. Organovocontinues to expect a net cash utilization(1) rate of $22 million to $24 millionin fiscal 2019, and believes it has sufficient funds to meet its operating and capital requirements through fiscal 2020.
Fiscal Second-Quarter 2019 Financial Highlights
- Net loss was
$5.8 million, a $3.6 millionimprovement over the year-ago period, as total costs and expenses declined 36 percent to $7.0 million, primarily due to lower employee and lab supply costs related to the Company’s organizational restructuring and prioritization of R&D projects.
- Net cash utilization was
$4.3 million, an improvement from $8.3 millionin the prior-year quarter.
- Total revenue was
$0.9 million, a 30 percent decrease from the year-ago period, primarily driven by lower revenue from products and services, partially offset by higher grant revenue.
- During the fiscal second quarter, the Company generated net proceeds of approximately
$2.1 millionfrom the issuance of 1.7 million shares of common stock in at-the-market offerings at a weighted average price of $1.27per share.
Definitions & Supplemental Financial Measures
(1) In addition to disclosing financial results that are determined in accordance with U.S. GAAP, the Company provides net cash utilization as a supplemental measure to help investors evaluate the Company’s fundamental operational performance. The Company defines net cash utilization as the net decrease in cash and cash equivalents during the reporting period less proceeds from the sale of common stock and the exercise of warrants and stock options during the reporting period. Net cash utilization is an operational measure that should be considered as additional financial information regarding our operations. This operational measure should not be considered without also considering our results prepared in accordance with U.S. GAAP, and should not be considered as a substitute for, or superior to, our U.S. GAAP results. The Company believes net cash utilization is a relevant and useful operational measure because it provides information regarding our cash utilization rate. Management uses net cash utilization to manage the business, including in preparing its annual operating budget, financial projections and compensation plans. The Company believes that net cash utilization is also useful to investors because similar measures are frequently used by securities analysts, investors and other interested parties in their evaluation of companies in similar industries. However, there is no standardized measurement of net cash utilization, and net cash utilization as the Company presents it may not be comparable with similarly titled operational measures used by other companies. Due to these limitations, the Company’s management does not view net cash utilization in isolation but also uses other measurements, such as cash used in operating activities and revenues to measure operating performance.
Conference Call Information
As previously announced, the Company will host a conference call to discuss its results at
Any statements contained in this press release that do not describe historical facts constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Any forward-looking statements contained herein are based on current expectations, but are subject to a number of risks and uncertainties. Forward-looking statements include, but are not limited to, statements regarding the potential benefits and therapeutic uses of the Company’s therapeutic liver tissue, including the benefits of an orphan designation; the Company’s expectations regarding the
|Organovo Holdings, Inc.|
|Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Loss|
|(in thousands except share and per share data)|
|Three Months Ended||Three Months Ended||Six Months Ended||Six Months Ended|
|September 30, 2018||September 30, 2017||September 30, 2018||September 30, 2017|
|Products and services||$||493||$||946||$||1,039||$||1,890|
|Collaborations and licenses||42||260||85||306|
|Cost of revenues||125||254||245||555|
|Research and development expenses||3,187||4,944||6,566||9,977|
|Selling, general and administrative expenses||3,640||5,736||8,407||11,592|
|Total costs and expenses||6,952||10,934||15,218||22,124|
|Loss from Operations||(6,009||)||(9,579||)||(13,586||)||(19,779||)|
|Other Income (Expense)|
|Gain (loss) on fixed asset disposals||—||—||2||—|
|Total Other Income||172||118||336||216|
|Income Tax Expense||—||—||(3||)||—|
|Currency Translation Adjustment||$||—||$||—||$||—||$||(11||)|
|Net loss per common share—basic and diluted||$||(0.05||)||$||(0.09||)||$||(0.12||)||$||(0.19||)|
|Weighted average shares used in computing net
loss per common share—basic and diluted
|Organovo Holdings, Inc.|
|Condensed Consolidated Balance Sheets|
|(in thousands except for share data)|
|September 30, 2018||March 31, 2018|
|Cash and cash equivalents||$||37,355||$||43,726|
|Prepaid expenses and other current assets||798||1,164|
|Total current assets||40,117||46,760|
|Fixed assets, net||2,236||2,788|
|Other assets, net||145||152|
|Liabilities and Stockholders’ Equity|
|Total current liabilities||3,291||4,658|
|Deferred revenue, net of current portion||-||19|
|Deferred rent, net of current portion||464||564|
|Commitments and Contingencies|
| Common stock, $0.001 par value; 200,000,000 shares authorized,
115,200,421 and 111,032,957 shares issued and outstanding at
September 30, 2018 and March 31, 2018, respectively
|Additional paid-in capital||286,128||278,595|
|Total stockholders’ equity||38,870||44,586|
|Total Liabilities and Stockholders’ Equity||$||42,625||$||49,827|
|Organovo Holdings, Inc.|
|Unaudited Condensed Consolidated Statements of Cash Flows|
|Six Months Ended||Six Months Ended|
|September 30, 2018||September 30, 2017|
|Cash Flows From Operating Activities|
|Adjustments to reconcile net loss to net cash used in operating activities:|
|(Gain) loss on disposal of fixed assets||(2||)||—|
|Depreciation and amortization||570||647|
|Increase (decrease) in cash resulting from changes in:|
|Prepaid expenses and other assets||366||210|
|Net cash used in operating activities||(11,346||)||(16,802||)|
|Cash Flows From Investing Activities|
|Purchases of fixed assets||(11||)||(56||)|
|Proceeds from disposals of fixed assets||2||—|
|Purchases of intangible assets||—||(70||)|
|Net cash used in investing activities||(9||)||(126||)|
|Cash Flows From Financing Activities|
|Proceeds from issuance of common stock and exercise of warrants, net||5,129||4,135|
|Employee taxes paid related to net share settlement of equity awards||(145||)||(51||)|
|Proceeds from exercise of stock options||—||825|
|Net cash provided by financing activities||4,984||4,909|
|Net decrease in cash, cash equivalents, and restricted cash||(6,371||)||(12,019||)|
|Cash, cash equivalents, and restricted cash at beginning of period||43,853||62,878|
|Cash, cash equivalents, and restricted cash at end of period||$||37,482||$||50,859|
|Reconciliation of cash, cash equivalents, and restricted cash to the condensed consolidated balance sheets|
|Cash and cash equivalents||37,355||50,732|
|Total cash, cash equivalent and restricted cash||37,482||50,859|
|Supplemental Disclosure of Cash Flow Information:|
|Income taxes paid||$||3||$||—|
Investor & Press Contact: Steve Kunszabo
Organovo Holdings, Inc.+1 (858) 224-1092 firstname.lastname@example.org