Cellular Biomedicine Group Reports Second Quarter and First Half 2018 Financial Results and Business Highlights

SHANGHAI, China and CUPERTINO, Calif., Aug. 08, 2018 (GLOBE NEWSWIRE) —

  • China Food and Drug Administration (CFDA) Accepts the Company’s Investigational New Drug (IND) Applications for anti-CD19 CAR-T Therapy Targeting NHL and ALL
  • Moved to New R&D Center in Gaithersburg, Maryland, USA

Cellular Biomedicine Group Inc. (NASDAQ: CBMG) (“CBMG” or the “Company”), a clinical-stage biopharmaceutical firm engaged in the development of immunotherapies for cancer and stem cell therapies for degenerative diseases, today reported financial results and business highlights for the second quarter and six months ended June 30, 2018.

“The acceptance of CBMG’s IND application for “C-CAR011” anti-CD19 chimeric antigen receptor T cell (CAR-T) therapy, for the treatment of adult patients with B-cell Non-Hodgkin’s lymphoma (NHL) and acute lymphoblastic leukemia (ALL) reinforces the strength of our immuno-oncology platform. We look forward to working with the CFDA to obtain approval to move to the next phase of development,” commented Tony (Bizuo) Liu, Chief Executive Officer of CBMG. “We continue to deploy our working capital to pursue and develop a robust non-CD19 pipeline targeting other liquid and solid tumors. We are also advancing our quality systems and automated manufacturing capabilities by utilizing digital technologies with the goal of becoming a premier international biopharma company and a preferred collaborator for cell therapy development in China. With the expansion and relocation of our U.S. R&D center to Gaithersburg, Maryland, we are committed to leverage our talented team to develop the latest technology in cancer cell therapy.  Being in the heart of this renowned research hub presents us with opportunities to collaborate with leading experts in this ecosystem to bridge new therapies developed in the U.S. into our clinical development in China, ultimately leading to serve the China market.”

Second Quarter and First Half 2018 Financial Performance

  1. G&A Expenses: General and administrative expenses remain relatively flat for the six months ended June 30, 2018 compared to the same period in 2017 due to the efficient management and utilization of resources.  General and administrative expenses for the quarter and six months ended June 30, 2018 were $3.1 million and $6.3 million, respectively, compared to $3.3 million and $6.4 million for the same periods in 2017.
  2. R&D Expenses: Research and development expenses grew substantially for the six months ended June 30, 2018 compared to the same period in 2017 due to the expanded commitment to research and development, process improvement and anticipated clinical activities. Research and development expenses for the quarter and six months ended June 30, 2018 were $6.2 million and $11.4 million respectively, compared to $3.3 million and $6.4 million for the same periods in 2017.
  3. Net Loss: Net loss allocable to common stock holders for the quarter and six months ended June 30, 2018 was $9.2 million and $17.7 million respectively, compared to $6.2 million and $12.4 million for the same periods in 2017.

Business & Technology Highlights First Half 2018

  • MOVED TO NEW R&D CENTER IN GAITHERSBURG: In May 2018, the Company moved its Maryland lab to a larger research and development center in Gaithersburg to accelerate the Company’s robust oncology research pipeline, to attract new recruits and to work closely with potential collaborating partners; 
  • SUBMITTED IND APPLICATIONS TO CFDA: In April 2018, the CFDA accepted the IND applications for anti-CD19 CAR-T therapy “C-CAR011” targeting NHL and ALL and the Company is working with the CFDA for approval to move to the next phase of development;
  • PUBLISHED KOA DATA: In March 2018, the Company presented its allogeneic adipose-derived mesenchymal progenitor cell off-the-shelf therapy AlloJoinTM for Knee Osteoarthritis (KOA) 48-week clinical data from the Phase I clinical trial in China, which demonstrated good safety and early efficacy for the prevention of cartilage deterioration;
  • OBTAINED OPTION TO LICENSE PATENT ON AFP TCR-T for HEPATOCELLULAR CARCINOMA: In February 2018, CBMG’s wholly-owned subsidiary entered into an agreement with Augusta University to take a three-year option to license technology for Alpha fetoprotein (AFP) T Cell Receptor (TCR), targeting Hepatocellular Carcinoma (HCC) (patent pending);
  • COMPLETED PRIVATE EQUITY FINANCING: In February 2018, Sailing Capital invested $30.6 million in CBMG.  Sailing Capital is a global private equity firm focused on disruptive technologies from innovative global companies in the healthcare, technology and consumer sectors.

About Cellular Biomedicine Group
Cellular Biomedicine Group, Inc. (NASDAQ:CBMG) develops proprietary cell therapies for the treatment of cancer and degenerative diseases. We conduct immuno-oncology and stem cell clinical trials in China using products from our integrated GMP laboratory. Our GMP facilities in China, consisting of twelve independent cell production lines, are designed and managed according to both China and U.S. GMP standards.  Our Shanghai facility includes a ”Joint Laboratory of Cell Therapy” with GE Healthcare and a “Joint Cell Therapy Technology Innovation and Application Center” with Thermo Fisher Scientific, which partnerships focus on improving manufacturing processes for cell therapies. CBMG currently has ongoing CAR-T Phase I clinical trials in China; CARD-1 for Diffuse Large B-cell Lymphoma (DLBCL) and Non-Hodgkin Lymphoma (NHL) and CALL-1 for adult Acute Lymphoblastic Leukemia (ALL), utilizing CBMG’s proprietary and optimized CD19 construct, a Phase IIb trial in China for Rejoin®  autologous Human Adipose-derived Mesenchymal Progenitor Cell (haMPC) for the treatment of Knee Osteoarthritis (KOA) as well as a Phase I trial in China for AlloJoin™ (CBMG’s “Off-the-Shelf” haMPC) for the treatment of KOA. CBMG is included in the broad-market Russell 3000® Index and the small-cap Russell 2000® Index, and the Loncar China BioPharma index. To learn more about CBMG, please visit www.cellbiomedgroup.com.  

Forward-Looking Statements
Statements in this press release relating to plans, strategies, trends, specific activities or investments, and other statements that are not descriptions of historical facts and may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors, which include those regarding our ability to implement our plans, strategies and objectives for future operations, including regulatory approval of our IND applications, our plan to configure part of our Shanghai facility with GE Healthcare’s FlexFactory platform, our ability to execute on proposed new products, services or development thereof, results of our clinical research and development, regulatory infrastructure governing cell therapy and cellular biopharmaceuticals, our ability to enter into agreements with any necessary manufacturing, marketing and/or distribution partners for purposes of commercialization, our ability to seek intellectual property rights for our product candidates, competition in the industry in which we operate, overall market conditions, any statements or assumptions underlying any of the foregoing and other risks detailed from time to time in CBMG’s reports filed with the Securities and Exchange Commission, quarterly reports on form 10-Q, current reports on form 8-K and annual reports on form 10-K. Forward-looking statements may be identified by terms such as “may,” “will,” “expects,” “plans,” “intends,” “estimates,” “potential,” or “continue,” or similar terms or the negative of these terms. Although CBMG believes the expectations reflected in the forward-looking statements are reasonable, they cannot guarantee that future results, levels of activity, performance or achievements will be obtained. CBMG does not have any obligation to update these forward-looking statements other than as required by law. 

    For the Six Months Ended
    June 30,
      2018       2017  
  Net loss   $  (17,682,499 )   $  (12,365,511 )
  Adjustments to reconcile net loss to net cash        
  used in operating activities:        
Depreciation and amortization      2,486,145        1,369,168  
Loss / (gain) on disposal of assets      2,721        (49 )
Stock based compensation expense      2,477,614        2,902,113  
Other than temporary impairment on long-term investments      29,424        –   
  Changes in operating assets and liabilities:        
Accounts receivable      66,451        (50,557 )
Other receivables      20,006        (488,480 )
Prepaid expenses      (579,479 )      13,246  
Long-term prepaid expenses and other assets      (649,262 )      (237,637 )
Accounts payable      114,249        949,142  
Accrued expenses      (9,892 )      (595,382 )
Deferred income      (4,515 )      1,069,515  
Other current liabilities      166,870        35,542  
Other non-current liabilities      (93,732 )      (379,161 )
  Net cash used in operating activities      (13,655,899 )      (7,778,051 )
  Proceeds from disposal of assets      –         286  
  Putting six-month deposits with the banks      (10,000,000 )      –   
Purchases of intangibles      (34,172 )      (23,339 )
Purchases of assets      (2,167,527 )      (3,014,055 )
  Net cash used in investing activities      (12,201,699 )      (3,037,108 )
Net proceeds from the issuance of common stock      30,506,521        –   
Proceeds from exercise of stock options      1,165,763        73,779  
Repurchase of treasury stock      (2,536,064 )      (1,357,931 )
  Net cash provided by financing activities      29,136,220        (1,284,152 )
EFFECT OF EXCHANGE RATE CHANGES ON CASH      (61,177 )      145,324  
INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS      3,217,445        (11,953,987 )
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD      21,568,422        39,252,432  
CASH AND CASH EQUIVALENTS, END OF PERIOD   $  24,785,867     $  27,298,445  

    For the Three Months Ended   For the Six Months Ended
    June 30,   June 30,
      2018       2017       2018       2017  
Net sales and revenue   $  77,313     $  62,914     $  128,274     $  161,339  
Operating expenses:                
Cost of sales      54,393        38,097        76,693        75,499  
General and administrative      3,121,695        3,319,093        6,310,492        6,504,340  
Selling and marketing      92,880        76,385        167,465        194,269  
Research and development      6,166,556        3,349,509        11,440,507        6,393,634  
Impairment of long-term investments      29,424        –         29,424        –   
  Total operating expenses      9,464,948        6,783,084        18,024,581        13,167,742  
Operating loss      (9,387,635 )      (6,720,170 )      (17,896,307 )      (13,006,403 )
Other income :                
Interest income      116,835        40,573        122,284        89,755  
Other income      84,724        476,079        93,924        553,587  
  Total other income      201,559        516,652        216,208        643,342  
Loss before taxes      (9,186,076 )      (6,203,518 )      (17,680,099 )      (12,363,061 )
Income taxes provision      –         –         (2,400 )      (2,450 )
Net loss   $  (9,186,076 )   $  (6,203,518 )   $  (17,682,499 )   $  (12,365,511 )
Other comprehensive income (loss):                
Cumulative translation adjustment      (1,120,722 )      292,452        (302,361 )      346,121  
  Unrealized loss on investments, net of tax      –         (240,000 )      –         (240,000 )
Total other comprehensive income (loss):      (1,120,722 )      52,452        (302,361 )      106,121  
Comprehensive loss   $  (10,306,798 )   $  (6,151,066 )   $  (17,984,860 )   $  (12,259,390 )
Net loss per share :                
  Basic and diluted   $  (0.53 )   $  (0.43 )   $  (1.03 )   $  (0.87 )
Weighted average common shares outstanding:                
  Basic and diluted     17,487,184       14,298,973       17,116,944       14,211,888  

    June 30,   December 31,
      2018       2017  
Cash and cash equivalents $  24,785,867     $  21,568,422  
Short-term investment    10,000,000        –   
Accounts receivable, less allowance for doubtful amounts of $10,655      
 and $10,789 as of June 30, 2018 and December 31, 2017, respectively    133,876        202,887  
Other receivables    150,128        170,842  
Prepaid expenses    2,409,101        1,852,695  
Total current assets    37,478,972        23,794,846  
Long-term investments    240,000        269,424  
Property, plant and equipment, net    14,072,278        12,973,342  
Goodwill    7,678,789        7,678,789  
Intangibles, net    11,538,905        12,419,692  
Long-term prepaid expenses and other assets    4,805,996        4,026,203  
Total assets $  75,814,940     $  61,162,296  
Liabilities and Stockholders’ Equity      
Accounts payable $  387,860     $  225,287  
Accrued expenses    1,078,584        1,097,327  
Taxes payable    28,875        28,875  
Other current liabilities    3,300,520        2,324,632  
Total current liabilities    4,795,839        3,676,121  
Other non-current liabilities    87,601        183,649  
Total liabilities    4,883,440        3,859,770  
Stockholders’ equity:      
  Preferred stock, par value $.001, 50,000,000 shares      
  authorized; none issued and outstanding as of      
  June 30, 2018 and December 31, 2017, respectively    –         –   
  Common stock, par value $.001, 300,000,000 shares authorized;      
 17,503,238 and 15,615,558 issued; and 16,942,470 and 15,188,764 outstanding,    
  as of June 30, 2018 and December 31, 2017, respectively    17,503        15,616  
  Treasury stock at cost:  560,768 and 426,794 shares of common stock      
  as of June 30, 2018 and December 31, 2017, respectively    (6,513,993 )      (3,977,929 )
Additional paid in capital    206,839,350        172,691,339  
  Accumulated deficit    (128,719,496 )      (111,036,997 )
  Accumulated other comprehensive loss    (691,864 )      (389,503 )
Total stockholders’ equity    70,931,500        57,302,526  
Total liabilities and stockholders’ equity $  75,814,940     $  61,162,296  

Sarah Kelly 
Director of Corporate Communications, CBMG

+1 408-973-7884

A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/f9b2bd6d-579b-4b5a-8b0c-4c2a3794d6c0