Histogen Inc. (NASDAQ: HSTO), a clinical-stage therapeutics company
focused on developing both restorative therapeutics for orthopedic
indications and pan-caspase and caspase selective inhibitors
focused on treatments for infectious and inflammatory diseases,
today reported financial results for the second quarter ended June
30, 2022 and provided an update on its clinical pipeline and other
corporate developments.
“We continue to focus on execution of IND
enabling activities for HST 004 in spinal disc regeneration,
exploration of testing emricasan in animal studies for methicillin
resistant staphylococcus aureus infections (“MRSA”) and evaluating
our caspase-1 inhibitors that impact the inflammasome pathway,”
said Steven J. Mento, Ph.D., Interim President and Chief Executive
Officer. “We also initiated a feasibility evaluation of our ongoing
HST 003 study for cartilage regeneration in the knee, including
implementation of protocol modifications, adding more sites, and
other study resources given the continued recruitment challenges
stemming from both the study protocol and impact of COVID-19 on the
elective surgery environment and expect to complete our evaluation
in the fourth quarter of 2022.”
Highlights from the Second Quarter 2022
and Business Updates
- HST 003 – Our Phase 1/2 clinical study of HST
003 to evaluate the safety and efficacy of human extracellular
matrix (hECM) implanted within microfracture interstices and the
cartilage defect in the knee to regenerate hyaline cartilage in
combination with a microfracture procedure is on-going. Despite
adding three additional clinical sites in the first quarter of
2022, we continue to experience recruitment challenges due to both
the specific nature of the study inclusion criteria and the impact
of COVID-19 on the elective surgery environment. We are currently
evaluating the overall feasibility of the ongoing HST 003 trial,
including implementing protocol modifications, adding more sites,
and other study resources. We expect to complete our feasibility
evaluation in the fourth quarter of 2022.
- HST 004 – Our initial preclinical research has
shown that HST 004 stimulates stem cells from the spinal disc to
proliferate and secrete aggrecan and collagen II, regenerates
normal matrix and cell tissue structure and restores disc height.
HST 004 was also shown to reduce inflammation and protease activity
and upregulate aggrecan production in an ex vivo spinal disc model.
We continue to execute on IND enabling activities for HST-004 and
anticipate filing IND for HST-004 in the second half of 2023.
- Emricasan MRSA - We continue to make progress
on exploring the feasibility of testing emricasan in animal studies
for MRSA. We expect to complete our feasibility assessment in the
third quarter of 2022.
- Regained Compliance with Nasdaq Minimum Bid Listing
Requirement - On June 2, 2022, we effected a 1-for-20
reverse stock split of the Company’s issued and
outstanding common stock, par value $0.0001 per share.
Subsequently, we received written notice from the Listing
Qualifications Department of the Nasdaq Stock Market stating that
the Company has regained compliance with the Nasdaq minimum bid
price listing requirement.
- $5 Million Financing – In July 2022, we closed
a $5 million private placement financing. We anticipate that the
net proceeds, in addition to our cash of $12.6M as of June 30,
2022, will support our operations through December 2023.
Six Months Ended June 30, 2022 Financial
Highlights
Product, License, and Grant
Revenues
For the six months ended June 30, 2022 and
2021, we recognized product revenues of $0 and $0.3 million,
respectively. The revenue for the first six months of 2021 was
related to the additional supply of cell conditioned medium (CCM)
to Allergan. As of March 31, 2021, all obligations of the Company
related to the additional supply of CCM to Allergan under the
Allergan Agreements have been completed.
For the six months ended June 30, 2022 and
2021, we recognized license revenue of $3.8 million and $17
thousand, respectively. The increase in the current period is due
to a one-time payment of $3.8 million received in March 2022 as
consideration for execution of the Allergan Letter Agreement.
For the six months ended June 30, 2022 and
2021, we recognized grant revenue of $0 and $0.1 million,
respectively. The related revenue is associated with a research and
development grant awarded to the Company from the National Science
Foundation (NSF). As of March 31, 2021, all work required by the
Company under the grant has been completed.
Cost of revenues for the six
months ended June 30, 2022 and 2021, we recognized $0 and $0.2
million, respectively, for cost of product sold to Allergan under
the Allergan Agreements.
Research and development
expenses for the six months ended June 30, 2022 and
2021 were $3.0 million and $4.5 million, respectively. The decrease
of $1.5 million was primarily due to decreases in development costs
of our clinical and pre-clinical product candidates and personnel
related expenses, partially offset by facility rent increases.
General and administrative
expenses for the six months ended June 30, 2022 and
2021 were $4.8 million and $4.2 million, respectively. The increase
of $0.6 million was primarily due to increases in royalty expenses
and legal fees, offset by reductions in personnel related
expenses.
Cash and cash equivalents as of
June 30, 2022 were $12.6 million which excludes gross proceeds of
approximately $5 million from the private placement financing
closed in July 2022. Histogen believes that its existing cash and
cash equivalents and cash inflow from operations will be sufficient
to meet Histogen’s anticipated cash needs through December of
2023.
About Histogen Inc.
Histogen Inc. is a clinical-stage therapeutics
company focused on developing both potential first-in-class
restorative therapeutics that ignite the body’s natural process to
repair and maintain healthy biological function as well as a
pipeline of clinical and preclinical small molecule pan-caspase and
caspase selective inhibitors focused on treatments for infectious
and inflammatory diseases. Under our biologics technology
platform, our product candidates in development are HST-003, a
treatment for joint cartilage repair, and HST-004, a treatment for
spinal disc repair. In addition, within our small molecule
pipeline, our product candidates include emricasan, CTS-2090 and
CTS-2096. Currently, emricasan is being developed jointly with our
collaboration partner, Amerimmune, for the treatment of COVID-19,
and we are evaluating the use of emricasan for other infectious
diseases including the treatment of MRSA. We also have preclinical
product candidates, CTS-2090 and CTS-2096, novel, potent, orally
bioavailable, and highly selective small molecule inhibitors of
caspase-1 designed for the treatment of certain inflammatory
diseases. For more information, please
visit www.histogen.com.
Forward-Looking Statements
This press release contains forward-looking
statements within the meaning of the “safe harbor” provisions of
the Private Securities Litigation Reform Act of 1995 and other
Federal securities laws. For example, we are using forward-looking
statements when we discuss our future operations and our ability to
successfully initiate, enroll and complete clinical trials, obtain
clinical trial data and achieve regulatory milestones and related
timing, including those related to the initiation, completion and
reporting of top line results for HST-003 Phase 1/2 clinical trial
for regeneration of cartilage in the knee, the completion of IND
enabling activities and the anticipated filing of the HST-004 IND
for spinal disc repair and the timing of providing clinical
development guidance on the emricasan and any further evaluation of
CTS-2090 and CTS-2096. We may not actually achieve the plans, carry
out the intentions or meet the expectations or projections
disclosed in the forward-looking statements and you should not
place undue reliance on these forward-looking statements. Because
such statements deal with future events and are based on our
current expectations, they are subject to various risks and
uncertainties and actual results, performance or achievements of
Histogen that could differ materially from those described in or
implied by the statements in this press release, including: our
ability to obtain funding for our operations, including funding
necessary to complete further development and any commercialization
of our product candidates; our expectations regarding the
arbitration and judicial proceedings related to emricasan and the
joint development with Amerimmune for COVID-19 and other infectious
and inflammatory diseases, including its ability to carry out the
development of emricasan and the potential for delays in the timing
of regulatory approval and the requirement for additional capital
to continue to advance these product candidates, which may not be
available on favorable terms or at all; our expectations regarding
the operation of our product candidates, collaborations and related
benefits; our beliefs regarding the success, cost and timing of our
product candidate development and collaboration activities and
current and future clinical trials and studies; our beliefs
regarding the potential markets for our product candidates,
collaborations and our collaborators’ ability to serve those
markets; any impact of the COVID-19 pandemic, or responses to the
pandemic, on our business, collaborations, clinical trials or
personnel; our beliefs regarding our industry; our ability to
attract and retain key personnel; regulatory developments in the
United States and foreign countries, with respect to our product
candidates; the expected impact of any arbitration and litigation
proceedings on our business, cash resources and the time required
by management to address such proceedings; the impact of any
arbitration and litigation proceedings on our business and market
and other conditions. The foregoing review of important factors
that could cause actual events to differ from expectations should
not be construed as exhaustive and should be read in conjunction
with statements that are included herein and elsewhere, including
those risks discussed in our filings with the Securities and
Exchange Commission. Except as otherwise required by law, Histogen
disclaims any intention or obligation to update or revise any
forward-looking statements, which speak only as of the date hereof,
whether as a result of new information, future events, or
circumstances or otherwise.
|
HISTOGEN
INC. AND SUBSIDIARIES UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share
amounts) |
|
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product revenue |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
306 |
|
License revenue |
|
|
5 |
|
|
|
5 |
|
|
|
3,760 |
|
|
|
17 |
|
Grant revenue |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
113 |
|
Total revenue |
|
|
5 |
|
|
|
5 |
|
|
|
3,760 |
|
|
|
436 |
|
Operating expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of product revenue |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
220 |
|
Research and development |
|
|
1,093 |
|
|
|
2,376 |
|
|
|
3,025 |
|
|
|
4,528 |
|
General and administrative |
|
|
2,306 |
|
|
|
1,822 |
|
|
|
4,812 |
|
|
|
4,154 |
|
Total operating expense |
|
|
3,399 |
|
|
|
4,198 |
|
|
|
7,837 |
|
|
|
8,902 |
|
Loss from operations |
|
|
(3,394 |
) |
|
|
(4,193 |
) |
|
|
(4,077 |
) |
|
|
(8,466 |
) |
Other income (expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
|
— |
|
|
|
(2 |
) |
|
|
(1 |
) |
|
|
(7 |
) |
Other Income |
|
|
— |
|
|
|
475 |
|
|
|
— |
|
|
|
475 |
|
Net loss |
|
|
(3,394 |
) |
|
|
(3,720 |
) |
|
|
(4,078 |
) |
|
|
(7,998 |
) |
Loss attributable to noncontrolling interest |
|
|
6 |
|
|
|
16 |
|
|
|
17 |
|
|
|
24 |
|
Deemed dividend - accretion of discount and redemption feature of
redeemable convertible preferred stock |
|
|
(488 |
) |
|
|
— |
|
|
|
(488 |
) |
|
|
— |
|
Net loss available to common stockholders |
|
$ |
(3,876 |
) |
|
$ |
(3,704 |
) |
|
$ |
(4,549 |
) |
|
$ |
(7,974 |
) |
Net loss per share available to common stockholders, basic and
diluted |
|
$ |
(1.55 |
) |
|
$ |
(1.99 |
) |
|
$ |
(1.82 |
) |
|
$ |
(4.64 |
) |
Weighted-average number of common shares outstanding used to
compute net loss per share, basic and diluted |
|
|
2,497,450 |
|
|
|
1,859,770 |
|
|
|
2,497,450 |
|
|
|
1,719,925 |
|
|
HISTOGEN
INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED
BALANCE SHEETS (in thousands, except share and per
share amounts) |
|
|
|
June 30, 2022 |
|
|
December 31, 2021 |
|
|
|
(unaudited) |
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
12,598 |
|
|
$ |
18,685 |
|
Restricted cash |
|
|
400 |
|
|
|
400 |
|
Accounts receivable, net |
|
|
88 |
|
|
|
165 |
|
Prepaid and other current assets |
|
|
1,941 |
|
|
|
2,359 |
|
Total current assets |
|
|
15,027 |
|
|
|
21,609 |
|
Property and equipment, net |
|
|
510 |
|
|
|
399 |
|
Right-of-use asset |
|
|
4,816 |
|
|
|
4,432 |
|
Other assets |
|
|
692 |
|
|
|
805 |
|
Total assets |
|
$ |
21,045 |
|
|
$ |
27,245 |
|
Liabilities and stockholders’ equity |
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
534 |
|
|
$ |
1,393 |
|
Accrued liabilities |
|
|
372 |
|
|
|
791 |
|
Current portion of lease liabilities |
|
|
212 |
|
|
|
127 |
|
Current portion of deferred revenue |
|
|
19 |
|
|
|
19 |
|
Total current liabilities |
|
|
1,137 |
|
|
|
2,330 |
|
Lease liabilities, non-current |
|
|
4,504 |
|
|
|
4,617 |
|
Noncurrent portion of deferred revenue |
|
|
89 |
|
|
|
98 |
|
Finance lease liability, non-current |
|
|
9 |
|
|
|
14 |
|
Total liabilities |
|
|
5,739 |
|
|
|
7,059 |
|
Commitments and contingencies (Note 8) |
|
|
|
|
|
|
|
|
Stockholders' Equity |
|
|
|
|
|
|
|
|
Preferred stock, $0.0001 par value; 10,000,000 shares authorized at
June 30, 2022 and December 31, 2021; no shares issued and
outstanding at June 30, 2022 and December 31, 2021 |
|
|
— |
|
|
|
— |
|
Common stock, $0.0001 par value; 200,000,000 shares authorized at
June 30, 2022 and December 31, 2021; 2,497,450 shares issued and
outstanding at June 30, 2022 and December 31, 2021 |
|
|
5 |
|
|
|
5 |
|
Additional paid-in capital |
|
|
98,037 |
|
|
|
98,839 |
|
Accumulated deficit |
|
|
(81,713 |
) |
|
|
(77,652 |
) |
Total Histogen Inc. stockholders’ equity |
|
|
16,329 |
|
|
|
21,192 |
|
Noncontrolling interest |
|
|
(1,023 |
) |
|
|
(1,006 |
) |
Total equity |
|
|
15,306 |
|
|
|
20,186 |
|
Total liabilities and stockholders’ equity |
|
$ |
21,045 |
|
|
$ |
27,245 |
|
CONTACT:
Susan A. KnudsonExecutive Vice President & CFO Histogen Inc.
ir@histogen.com
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