Orgenesis Provides Business Update for Second Quarter of 2023
Reports Progress in Advancing the Rollout of the POCare Platform and POCare Therapeutic Pipeline
Orgenesis to Host Conference Call Today at 8:00 AM ET
GERMANTOWN, Md., Aug. 11, 2023 (GLOBE NEWSWIRE) — Orgenesis Inc. (NASDAQ: ORGS) (“Orgenesis” or the “Company”), a global biotech company working to unlock the full potential of cell and gene therapies (CGT), today provided a business update for the second quarter ended June 30, 2023.
Vered Caplan, CEO of Orgenesis, said, “We are pleased to report revenue of approximately $7.0 million for the second quarter of 2023, which reflects the ongoing rollout of our POCare platform. We recently rebranded the POC Services business from Morgenesis to Octomera, following an additional investment from MM OS Holdings, L.P. (“MM”), an affiliate of Metalmark Capital Partners (“Metalmark”), a leading private equity firm. We believe their continued investment is further validation of our business model.”
“We continue to support the growth of our global POCare Network, which now includes a number of PoCare Centers located at strategic locations in various countries worldwide, which serve as hubs for the respective regions to help potentially being lifesaving treatments to patients across North America, Europe, Asia, and the Middle East. We also signed a recent partnership agreement with University of California, UC Davis to deploy Octomera Mobile Processing Units and Labs (OMPULs) at UC Davis and other healthcare universities within the State of California. Through these steps, we are clearly executing on our strategy to make advanced cell and gene therapy (CGT) products and services more accessible, affordable, and available to patients than traditional centralized models of CGT production.”
Ms. Caplan concluded, “We are also advancing our POCare therapeutic pipeline by leveraging grants and partnerships to help pay for their development. These programs span immuno-oncology, anti-viral, metabolic/auto-immune diseases, and tissue regeneration. We are focused on identifying the optimal licensing and marketing partners for several of the more advanced product candidates in our pipeline. As these programs progress, we expect to increasingly benefit from revenue sharing and royalty agreements with our partners as we seek to advance the respective therapies through commercialization. Overall, we believe we have built a scalable, high margin, recurring revenue business model.”
The complete financial results for the second quarter of 2023 are available on the Company’s website in the Company’s Form 10-Q, which has been filed with the Securities and Exchange Commission. The Company also notes that as a result of the deconsolidation of Octomera, the assets and liabilities of Octomera are not included on the Company’s balance sheet for the period ended June 30, 2023, although the Company still owns approximately 75% of Octomera.
Conference Call
The Company will host a conference call at 8:00 AM Eastern Time today, August 11, 2023, to discuss the Company’s corporate progress and other developments.
The conference call will be available via telephone by dialing toll free 877-545-0523 for U.S. callers or +1 973-528-0016 for international callers and using entry code 132591. A webcast of the call may be accessed at https://www.webcaster4.com/Webcast/Page/2585/48936 or on the Company’s Investor Events section of the website here.
A webcast replay will be available on the Company’s Investor Events section of the website (https://ir.orgenesis.com/events#/) through Sunday, August 11, 2024. A telephone replay of the call will be available approximately one hour following the call, through Friday, August 25, 2023, and can be accessed by dialing 877-481-4010 for U.S. callers or +1 919-882-2331 for international callers and entering conference ID: 48936.
About Orgenesis
Orgenesis is a global biotech company that has been committed to unlocking the potential of decentralized cell and gene therapies (CGTs) since 2012. Orgenesis established the POCare Network in 2020 to bring academia, hospitals, and Industry together to make these innovations more affordable and accessible to patients. In 2022, the POCare Services business unit responsible for developing and managing the decentralized POCare Centers and proprietary OMPULs was formed. Orgenesis will continue to focus on advancing to market through various partnerships its CGTs to provide a rapid, globally harmonized pathway for these therapies to reach and treat large numbers of patients at lowered costs through efficient, scalable, and decentralized production. Additional information about the Company is available at: www.orgenesis.com.
Notice Regarding Forward-Looking Statements
This press release contains forward-looking statements which are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended. These forward-looking statements involve substantial uncertainties and risks and are based upon our current expectations, estimates and projections and reflect our beliefs and assumptions based upon information available to us at the date of this release. We caution readers that forward-looking statements are predictions based on our current expectations about future events. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict. Our actual results, performance or achievements could differ materially from those expressed or implied by the forward-looking statements as a result of a number of factors, including, but not limited to, our reliance on, and our ability to grow, our point-of-care cell therapy platform and OMPUL business, our ability to achieve and maintain overall profitability, our ability to manage our research and development programs that are based on novel technologies, our ability to control key elements relating to the development and commercialization of therapeutic product candidates with third parties, the timing of completion of clinical trials and studies, the availability of additional data, outcomes of clinical trials of our product candidates, the potential uses and benefits of our product candidates, our ability to manage potential disruptions as a result of the COVID-19 pandemic, the sufficiency of working capital to realize our business plans and our ability to raise additional capital, the development of our POCare strategy, our trans differentiation technology as therapeutic treatment for diabetes, the technology behind our in-licensed ATMPs not functioning as expected, our ability to further our CGT development projects, either directly or through our JV partner agreements, and to fulfill our obligations under such agreements, our license agreements with other institutions, our ability to retain key employees, our competitors developing better or cheaper alternatives to our products, risks relating to legal proceedings against us and the risks and uncertainties discussed under the heading “RISK FACTORS” in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, and in our other filings with the Securities and Exchange Commission. We undertake no obligation to revise or update any forward-looking statement for any reason.
IR contact for Orgenesis:
Crescendo Communications, LLC
Tel: 212-671-1021
Orgs@crescendo-ir.com
Communications contact for Orgenesis
IB Communications
Neil Hunter / Michelle Boxall
Tel +44 (0)20 8943 4685
neil@ibcomms.agency / michelle@ibcomms.agency
(tables follow)
| ORGENESIS INC. | |||||
| CONSOLIDATED BALANCE SHEETS | |||||
| (U.S. Dollars, in thousands) | |||||
| As of | |||||
| June 30, 2023 | December 31, 2022 | ||||
| Assets | |||||
| CURRENT ASSETS: | |||||
| Cash and cash equivalents | $ | 180 | $ | 5,311 | |
| Restricted cash | 1,047 | 1,058 | |||
| Accounts receivable, net | 6 | 36,183 | |||
| Prepaid expenses and other receivables | 4,300 | 958 | |||
| Receivables from related parties | 966 | – | |||
| Convertible loan to related party | 2,762 | 2,688 | |||
| Inventory | 34 | 120 | |||
| Total current assets | 9,295 | 46,318 | |||
| NON-CURRENT ASSETS: | |||||
| Deposits | $ | 47 | $ | 331 | |
| Equity investees | 31,484 | 39 | |||
| Loans to associates | 97 | 96 | |||
| Property, plant and equipment, net | 1,249 | 22,834 | |||
| Intangible assets, net | 7,681 | 9,694 | |||
| Operating lease right-of-use assets | 494 | 2,304 | |||
| Goodwill | 3,703 | 8,187 | |||
| Deferred tax | – | 103 | |||
| Other assets | 717 | 1,022 | |||
| Total non-current assets | 45,472 | 44,610 | |||
| TOTAL ASSETS | $ | 54,767 | $ | 90,928 | |
| ORGENESIS INC. | |||||||
| CONSOLIDATED BALANCE SHEETS | |||||||
| (U.S. Dollars, in thousands) | |||||||
| As of | |||||||
| June 30, 2023 | December 31, 2022 | ||||||
| Liabilities and Equity | |||||||
| CURRENT LIABILITIES: | |||||||
| Accounts payable | $ | 3,826 | $ | 4,429 | |||
| Accounts payable related parties | 133 | – | |||||
| Accrued expenses and other payables | 2,235 | 2,578 | |||||
| Income tax payable | 520 | 289 | |||||
| Employees and related payables | 901 | 1,860 | |||||
| Other payables related parties | 999 | – | |||||
| Advance payments on account of grant | 1,481 | 1,578 | |||||
| Contract liabilities | – | 70 | |||||
| Current maturities of finance leases | 18 | 60 | |||||
| Current maturities of operating leases | 254 | 542 | |||||
| Short-term and current maturities of convertible loans | 2,344 | 4,504 | |||||
| Total current liabilities | 12,711 | 15,910 | |||||
| LONG-TERM LIABILITIES: | |||||||
| Non-current operating leases | $ | 184 | $ | 1,728 | |||
| Convertible loans | 17,834 | 13,343 | |||||
| Retirement benefits obligation | – | 163 | |||||
| Long-term debt and finance leases | 13 | 95 | |||||
| Advance payments on account of grant | – | 144 | |||||
| Other long-term liabilities | 60 | 271 | |||||
| Total long-term liabilities | 18,091 | 15,744 | |||||
| TOTAL LIABILITIES | 30,802 | 31,654 | |||||
| REDEEMABLE NON-CONTROLLING INTEREST | $ | – | $ | 30,203 | |||
| EQUITY: Common stock of $0.0001 par value: Authorized at June 30, 2023 and December 31, 2022: 145,833,334 shares; Issued at June 30, 2023 and December 31, 2022: 28,753,374 and 25,832,322 shares, respectively; Outstanding at June 30, 2023 and December 31, 2022: 28,466,807 and 25,545,755 shares, respectively | 3 | 3 | |||||
| Additional paid-in capital | 154,743 | 150,355 | |||||
| Accumulated other comprehensive (income) loss | 62 | (270 | ) | ||||
| Treasury stock 286,567 shares as of June 30, 2023 and December 31, 2022 | (1,266 | ) | (1,266 | ) | |||
| Accumulated deficit | (129,577 | ) | (121,261 | ) | |||
| Equity attributable to Orgenesis Inc. | 23,965 | 27,561 | |||||
| Non-controlling interest | – | 1,510 | |||||
| Total equity | 23,965 | 29,071 | |||||
| TOTAL LIABILITIES REDEEMABLE NON-CONTROLLING INTEREST AND EQUITY | $ | 54,767 | $ | 90,928 | |||
| ORGENESIS INC. | |||||||||||||||
| CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS | |||||||||||||||
| (U.S. Dollars, in thousands, except share and per share amounts) | |||||||||||||||
| Three Months Ended | Six Months Ended | ||||||||||||||
| June 30, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | ||||||||||||
| Revenues | $ | 6,975 | $ | 6,699 | $ | 14,019 | $ | 13,276 | |||||||
| Revenues from related party | – | 502 | – | 1,137 | |||||||||||
| Total revenues | 6,975 | 7,201 | 14,019 | 14,413 | |||||||||||
| Cost of revenues | 3,232 | 1,063 | 5,954 | 1,777 | |||||||||||
| Gross profit | 3,743 | 6,138 | 8,065 | 12,636 | |||||||||||
| Cost of development services and research and development expenses | 3,527 | 7,838 | 6,808 | 14,489 | |||||||||||
| Amortization of intangible assets | 208 | 229 | 415 | 461 | |||||||||||
| Selling, general and administrative expenses | 3,337 | 2,803 | 7,376 | 5,654 | |||||||||||
| Operating loss | 3,329 | 4,732 | 6,534 | 7,968 | |||||||||||
| Other income, net | – | (8 | ) | (2 | ) | (8 | ) | ||||||||
| Loss from extinguishment in connection with convertible loan | – | – | 283 | – | |||||||||||
| Financial expenses, net | 655 | 389 | 1,299 | 602 | |||||||||||
| Profit from deconsolidation of Octomera (see note 3) | (411 | ) | – | (411 | ) | – | |||||||||
| Share in net loss (profit) of associated companies | (3 | ) | 368 | (1 | ) | 915 | |||||||||
| Loss before income taxes | 3,570 | 5,481 | 7,702 | 9,477 | |||||||||||
| Tax expenses | 91 | 11 | 220 | 12 | |||||||||||
| Net loss | 3,661 | 5,492 | 7,922 | 9,489 | |||||||||||
| Net income (loss) attributable to non-controlling interests (including redeemable) | 466 | (65 | ) | 394 | (53 | ) | |||||||||
| Net loss attributable to Orgenesis Inc. | $ | 4,127 | $ | 5,427 | $ | 8,316 | $ | 9,436 | |||||||
| Loss per share: | |||||||||||||||
| Basic and diluted | $ | 0.15 | $ | 0.22 | $ | 0.30 | $ | 0.38 | |||||||
| Weighted average number of shares used in computation of Basic and Diluted loss per share: | |||||||||||||||
| Basic and diluted | 28,357,779 | 24,820,756 | 27,308,183 | 24,711,462 | |||||||||||
| Comprehensive loss: | |||||||||||||||
| Net loss | $ | 3,661 | $ | 5,492 | $ | 7,922 | $ | 9,489 | |||||||
| Other comprehensive loss – translation adjustments | 11 | 326 | 52 | 477 | |||||||||||
| Release of translation adjustment due to deconsolidation of Octomera | (384 | ) | – | (384 | ) | – | |||||||||
| Comprehensive loss | 3,288 | 5,818 | 7,590 | 9,966 | |||||||||||
| Comprehensive income (loss) attributed to non-controlling interests | 466 | (65 | ) | 394 | (53 | ) | |||||||||
| Comprehensive loss attributed to Orgenesis Inc. | $ | 3,754 | $ | 5,753 | $ | 7,984 | $ | 9,913 | |||||||
