SOURCE: International Stem Cell Corporation

International Stem Cell Corporation

March 31, 2016 08:30 ET

International Stem Cell Corporation Announces 2015 Fourth Quarter and Year-End Results

CARLSBAD, CA--(Marketwired - March 31, 2016) - International Stem Cell Corporation (OTCQB: ISCO) (www.internationalstemcell.com) ("ISCO" or "the Company"), a California-based clinical stage biotechnology company developing novel stem cell-based therapies and biomedical products, today provided a business update and announced fourth quarter and year-end financial results for the period ended December 31, 2015.

"2015 was a milestone year for ISCO. We made significant progress in our corporate priorities and received authorization by the Therapeutics Goods Administration in Australia to initiate a Phase I dose escalation clinical trial of human parthenogenetic stem cells-derived neural stem cells (ISC-hpNSC®) in patients with moderate to severe Parkinson's disease (PD)," stated Andrey Semechkin, Ph.D., CEO and co-Chairman of ISCO. "In addition to Parkinson's, our scientists are currently evaluating other therapeutic indications based on our stem cell technology platform. We believe that we are on track to bring a stroke program into clinical trial using ISC-hpNSC® and develop a therapy for osteoarthritis using the patient's own cells. We anticipate continued momentum in 2016 and look forward to reporting on our progress."

FY 2015 Financial highlights:

  • Operating income from Lifeline Skin Care and Lifeline Cell Technology wholly owned subsidiaries of International Stem Cell Corporations combined increased by 65% to $1.67 million for the year ended December 31, 2015, compared to $1.01 million in 2014;
  • $7.55 million in revenue for the year ended December 31, 2015, an increase of 8% compared to 2014; Lifeline Skin Care sales were stable and Lifeline Cell Technology sales were up 15%. Gross margin stable at 73%;
  • Average net cash used in operating activities of $343,000 per month for the year ended December 31, 2015; the company ended 2015 with cash of approximately $532,000.

Recent Corporate Highlights

  • Received approval to start clinical trial of ISC-hpNSC® for the treatment of Parkinson's disease in Australia;
  • Developed technology with the potential to replace cartilage for the treatment of osteoarthritis;
  • Signed a clinical service agreement for the Phase 1 clinical study in Australia with the Florey Institute of Neuroscience and Mental Health, one of the world's leading brain research centers;
  • In its Lifeline Skin Care business, the company launched new nano-compound products. In all of tests the proprietary compounds induced up to twice the production of elastin and collagen compared to Retinoic Acid (the active form of Retinol) with none of its toxic characteristics.

2016 Anticipated Events

  • Complete dosing in Phase I clinical study in Australia;
  • Report preliminary efficacy and safety clinical trial results;
  • Report on animal studies results for the treatment of stroke;
  • Report on animal studies results for the treatment of osteoarthritis.

Presentations & Publications

In 2015, the company presented comprehensive findings of its preclinical studies in Parkinson's disease at:

  • The American Society for Neural Therapy and Repair Annual Meeting;
  • The 2015 American Academy of Neurology Annual Meeting;
  • The 21st annual meeting of the International Society for Cellular Therapy;
  • The Society for Neuroscience Annual Meeting at Neuroscience 2015.
  • The Company published results of two proof of concept studies supporting the safety and efficacy of the company's treatment of Parkinson's Disease in peer-reviewed journal, Cell Transplantation.

In the first half 2016:

  • ISCO is planning to present at the American Society for Neural Therapy and Repair Annual Meeting in April.

About International Stem Cell Corporation

International Stem Cell Corporation is focused on the therapeutic applications of human parthenogenetic stem cells (hpSCs) and the development and commercialization of cell-based research and cosmetic products. ISCO's core technology, parthenogenesis, results in the creation of pluripotent human stem cells from unfertilized oocytes (eggs). hpSCs avoid ethical issues associated with the use or destruction of viable human embryos. ISCO scientists have created the first parthenogenetic, homozygous stem cell line that can be a source of therapeutic cells for hundreds of millions of individuals of differing genders, ages and racial background with minimal immune rejection after transplantation. hpSCs offer the potential to create the first true stem cell bank, UniStemCell™. ISCO also produces and markets specialized cells and growth media for therapeutic research worldwide through its subsidiary Lifeline Cell Technology (www.lifelinecelltech.com), and stem cell-based skin care products through its subsidiary Lifeline Skin Care (www.lifelineskincare.com). More information is available at www.internationalstemcell.com.

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Safe harbor statement

Statements pertaining to anticipated developments, expected pre-clinical studies (including timing and results), progress of research and development, and other opportunities for the company and its subsidiaries, along with other statements about the future expectations, beliefs, goals, plans, or prospects expressed by management constitute forward-looking statements. Any statements that are not historical fact (including, but not limited to statements that contain words such as "will," "believes," "plans," "anticipates," "expects," "estimates,") should also be considered to be forward-looking statements. Forward-looking statements involve risks and uncertainties, including, without limitation, risks inherent in the development and/or commercialization of potential products, regulatory approvals, need and ability to obtain future capital, application of capital resources among competing uses, and maintenance of intellectual property rights. Actual results may differ materially from the results anticipated in these forward-looking statements and as such should be evaluated together with the many uncertainties that affect the company's business, particularly those mentioned in the cautionary statements found in the company's Securities and Exchange Commission filings. The company disclaims any intent or obligation to update forward-looking statements.

   
International Stem Cell Corporation and Subsidiaries  
Consolidated Balance Sheets  
(in thousands, except share data)  
   
    December 31,     December 31,  
    2015     2014  
Assets                
  Cash and cash equivalents   $ 532     $ 1,111  
  Accounts receivable, net of allowance for doubtful accounts of $20 and $19 at December 31, 2015 and December 31, 2014, respectively     539       453  
  Inventory, net     1,348       1,517  
  Prepaid expenses and other current assets     572       485  
  Restricted cash     -       50  
    Total current assets     2,991       3,616  
  Property and equipment, net     375       714  
  Intangible assets, net     3,223       2,795  
  Non-current inventory     489       -  
  Deposits and other assets     60       54  
    Total assets   $ 7,138     $ 7,179  
Liabilities and Stockholders' Equity                
  Accounts payable   $ 1,092     $ 670  
  Accrued liabilities     834       1,711  
  Related party payable     3,129       11  
  Advances     250       250  
  Fair value of warrant liability     239       4,216  
    Total current liabilities     5,544       6,858  
Commitments and contingencies                
Stockholders' Equity                
Series B Convertible Preferred stock, $0.001 par value, 5,000,000 shares authorized, 250,000 and 300,000 issued and outstanding at December 31, 2015 and December 31, 2014, respectively, with liquidation preferences of $366 and $421 at December 31, 2015 and December 31, 2014, respectively     -       -  
Series D Convertible Preferred stock, $0.001 par value, 50 shares authorized, 43 shares issued and outstanding, with liquidation preference of $4,320     -       -  
Series G Convertible Preferred stock, $0.001 par value, 5,000,000 shares authorized, issued and outstanding, with liquidation preference of $5,000     5       5  
Series H-1 Convertible Preferred stock, $0.001 par value, 0 and 2,000 shares authorized at December 31, 2015 and December 31, 2014, respectively, 0 and 1,482 issued and outstanding at December 31, 2015 and December 31, 2014, respectively     -       -  
Series H-2 Convertible Preferred stock, $0.001 par value, 0 and 500 shares authorized at December 31, 2015 and December 31, 2014, respectively, 0 and 500 issued and outstanding at December 31, 2015 and December 31, 2014, respectively     -       -  
Common stock, $0.001 par value, 720,000,000 shares authorized at December 31, 2015 and December 31, 2014, 2,808,598 and 1,596,195 shares issued and outstanding at December 31, 2015 and December 31, 2014, respectively (1)     3       2  
Additional paid-in capital     98,970       95,063  
Accumulated deficit     (97,384 )     (94,749 )
  Total stockholders' equity     1,594       321  
  Total liabilities and stockholders' equity   $ 7,138     $ 7,179  
                 
(1) See Note 1, "Reverse Stock Split"
 
See accompanying notes to the consolidated financial statements.
   
   
   
International Stem Cell Corporation and Subsidiaries  
Consolidated Statements of Operations  
(in thousands, except per share data)  
   
    Years Ended  
    December 31,  
    2015     2014  
Revenues                
  Product sales   $ 7,551     $ 7,017  
    Total revenue     7,551       7,017  
Expenses                
  Cost of sales     2,056       1,921  
  Research and development     2,707       5,386  
  Selling and marketing     2,637       2,785  
  General and administrative     4,715       5,605  
    Total expenses     12,115       15,697  
Loss from operating activities     (4,564 )     (8,680 )
Other income (expense)                
  Change in fair value of warrant liability     1,980       2,405  
  Fair value of warrant liability in excess of proceeds     -       (1,780 )
  Financing transaction costs     -       (997 )
  Warrant exchange inducement expense     -       (3,445 )
  Interest expense     (11 )     (2 )
  Sublease income     1       30  
  Miscellaneous expense     (41 )     (9 )
    Total other income (expense), net     1,929       (3,798 )
Loss before income taxes     (2,635 )     (12,478 )
Provision for income taxes     -       -  
    Net loss   $ (2,635 )   $ (12,478 )
Net loss applicable to common stockholders   $ (2,635 )   $ (12,478 )
Net loss per common share-basic (1)   $ (1.33 )   $ (9.71 )
Net loss per common share-diluted (1)   $ (2.26 )   $ (10.34 )
Weighted average shares-basic (1)     1,984       1,285  
Weighted average shares-diluted (1)     2,038       1,207  
                 
                 
(1) See Note 1, "Reverse Stock Split"
 
See accompanying notes to the consolidated financial statements.
 

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