• E-mail
• Print
• Comment
• Font Size
• Digg
• del.icio.us
• Discuss article

Cytori Announces 3rd Quarter Results: Update on Adipose Stem Cells in Cardiac Disease and Reconstructive Surgery

Posted on: Tuesday, 14 November 2006, 18:01 CST

Cytori Therapeutics, Inc. (NASDAQ:CYTX) (Frankfurt:XMPA) announces financial results for the quarter ended September 30, 2006 and reports progress in its development of adipose stem cells in cardiovascular disease and for use in reconstructive surgery.

"During the third quarter, Cytori moved significantly closer to initiating its cardiovascular clinical trials," said Christopher J. Calhoun, Chief Executive Officer of Cytori Therapeutics. "The first trial is expected to start before year end in patients suffering from chronic ischemia, a severe form of coronary artery disease, and the heart attack trial is expected to begin in early 2007. Additionally, Cytori expanded its commitment to using adipose stem cells in breast reconstruction post mastectomy and radiation therapy. This is another significant as well as near-term product opportunity for Cytori. It represents an ideal entry into the broader aesthetic and reconstructive surgery market."

Select milestones that Cytori achieved during and subsequent to the end of the third quarter include the following:

Cytori was informed of the completion of enrollment of the RESTORE investigator-initiated study in Japan using adipose stem cells, which were processed using Cytori's stem cell processing system, to treat the complication of surgery and radiation damage following partial mastectomy.

Authored a review on the opportunity for adipose stem cells in cosmetic and reconstructive surgery

Received U.S. 510(K) regulatory clearance on the Celution™ Cell Concentration System as a cell saver device by the FDA's Center for Devices and Radiological Health (CDRH)

Raised approximately $16.8 million from the sale of 2,918,255 shares at $5.75 per share

Financials

Cash, cash equivalents and short term investments were $18.4 million as of September 30, 2006.

Total product and development revenues for the three and nine months ended September 30, 2006 were $0.5 million and $2.3 million, respectively, compared to $1.6 million and $4.9 million for the same periods in 2005. Research and development expenses for the three and nine months ended September 30, 2006 were $5.6 million and $16.7 million, respectively, compared to $4.0 million and $10.6 million for the three and nine months ended September 30, 2005, respectively. General and administrative expenses for the three and nine months ended September 30, 2006 were $3.2 million and $10.0 million, respectively, compared to $3.1 million and $7.5 million for the same periods in 2005, respectively. Net loss for the three and nine months ended September 30, 2006 was $8.8 million and $23.5 million, or $(0.53) and $(1.48) per common share, respectively, compared to a net loss of $2.3 million and $12.2 million, or $(0.15) and $(0.84) per common share, for the same periods in 2005, respectively.

The increase in R&D for the first nine months is attributed to additional preclinical studies as part of preparations for upcoming clinical trials; increased Celution™ System development expenses to attain regulatory approvals; and internal scale-up for manufacturing of devices and consumables for clinical trials. Cytori reduced its operating expenses due to a significant reduction in non-core biomaterials resource allocation, which we expect will bring our monthly burn to nearly $2 million for the remainder of the year.

Conference Call Information

The management of Cytori Therapeutics will host a conference call today at 4:30 p.m. Eastern Standard Time (EST) or 10:30 p.m. Central European Time (CET). The conference call will be webcast live and may be accessed under "Events & Webcasts" in the Investor Relations section of the Company's website at http://www.cytoritx.com. The archived version of the webcast will be available two hours after the call on the company's website and accessible for 14 days. A telephone replay will be available for one week. To access the replay, please call +1 (303) 590-3000 (PIN: 11072851#).

About Cytori Therapeutics

Cytori Therapeutics, Inc., (NASDAQ:CYTX) (Frankfurt:XMPA) is discovering and developing proprietary cell-based therapeutics utilizing adult stem and regenerative cells derived from adipose tissue, also known as fat. The Company is targeting cardiovascular disease, gastrointestinal disorders and new approaches for aesthetic and reconstructive surgery. To facilitate processing and delivery of adipose stem and regenerative cells, Cytori has developed its proprietary Celution™ System to isolate and concentrate a patient's own stem and regenerative cells in about an hour. This system will dramatically improve the speed in which personalized cell-based therapies can be delivered to patients.

Cautionary Statement Regarding Forward-Looking Statements

This press release includes forward-looking statements regarding events, trends and prospects of our business which may affect our future operating results and financial position. Such statements are subject to risks and uncertainties that could cause our actual results and financial position to differ materially. Some of these risks and uncertainties include our history of operating losses and expected continuing losses, the need for further financing, our ability to develop and commercialize regenerative cell-based therapies, our dependence on third parties, our ability to obtain, defend and enforce our intellectual property, and other risks and uncertainties described (under the heading "Risk Factors") in Cytori Therapeutics' Form 10-K annual report for the year ended December 31, 2005 and subsequent SEC filings. We assume no responsibility to update or revise any forward-looking statements to reflect events, trends or circumstances after the date they are made.

Consolidated Condensed Balance Sheets

(Unaudited)

As of September 30,

2006

As of December 31,

2005

Assets

Current assets:

Cash and cash equivalents

$ 13,615,000 

$ 8,007,000 

Short-term investments, available-for-sale

4,834,000 

7,838,000 

Accounts receivable, net of allowance for doubtful accounts of $1,000 and $9,000 in 2006 and 2005, respectively

103,000 

816,000 

Inventories, net

210,000 

258,000 

Other current assets

781,000 

621,000 

Total current assets

19,543,000 

17,540,000 

Property and equipment held for sale, net

457,000 

675,000 

Property and equipment, net

4,578,000 

3,585,000 

Investment in joint venture

82,000 

-- 

Other assets

453,000 

458,000 

Intangibles, net

1,355,000 

1,521,000 

Goodwill

4,387,000 

4,387,000 

Total assets

$ 30,855,000 

$ 28,166,000 

Liabilities and Stockholders' Deficit

Current liabilities:

Accounts payable and accrued expenses

$ 4,850,000 

$ 6,129,000 

Current portion of long-term obligations

886,000 

952,000 

Total current liabilities

5,736,000 

7,081,000 

Deferred revenues, related party

29,128,000 

17,311,000 

Deferred revenues

2,392,000 

2,541,000 

Option liabilities

1,817,000 

5,331,000 

Long-term deferred rent

831,000 

573,000 

Long-term obligations, less current portion

910,000 

1,558,000 

Total liabilities

40,814,000 

34,395,000 

Commitments and contingencies

Stockholders' deficit:

Preferred stock, $0.001 par value; 5,000,000 shares authorized; -0- shares issued and outstanding in 2006 and 2005

-- 

-- 

Common stock, $0.001 par value; 95,000,000 shares authorized; 21,475,506 and 18,194,283 shares issued and 18,602,672 and 15,321,449 shares outstanding in 2006 and 2005, respectively

21,000 

18,000 

Additional paid-in capital

102,016,000 

82,196,000 

Accumulated deficit

(101,548,000)

(78,013,000)

Treasury stock, at cost

(10,414,000)

(10,414,000)

Accumulated other comprehensive loss

(34,000)

(16,000)

Total stockholders' deficit

(9,959,000)

(6,229,000)

Total liabilities and stockholders' deficit

$ 30,855,000 

$ 28,166,000 

Consolidated and Condensed Statements of Operations and Comprehensive Loss

(Unaudited)

For the Three Months

Ended September 30,

For the Nine Months

Ended September 30,

2006 

2005 

2006 

2005 

Product revenues, related party

$ 133,000 

$ 1,544,000 

$ 1,087,000 

$ 4,776,000 

Cost of product revenues

383,000 

928,000 

1,341,000 

2,411,000 

Gross (loss) profit

(250,000)

616,000 

(254,000)

2,365,000 

Development revenues:

Development

1,000 

11,000 

832,000 

20,000 

Research grant and other

350,000 

27,000 

413,000 

116,000 

Total development revenues

351,000 

38,000 

1,245,000 

136,000 

Operating expenses:

Research and development

5,552,000 

3,991,000 

16,749,000 

10,573,000 

Sales and marketing

610,000 

479,000 

1,584,000 

1,207,000 

General and administrative

3,181,000 

3,129,000 

10,005,000 

7,486,000 

Change in fair value of option liabilities

(374,000)

924,000 

(3,514,000)

984,000 

Total operating expenses

8,969,000 

8,523,000 

24,824,000 

20,250,000 

Operating loss

(8,868,000)

(7,869,000)

(23,833,000)

(17,749,000)

Other income (expense):

Interest income

158,000 

99,000 

537,000 

208,000 

Interest expense

(47,000)

(31,000)

(158,000)

(107,000)

Other expense, net

(7,000)

(13,000)

(13,000)

(52,000)

Equity loss from investment in joint venture

(3,000)

-- 

(68,000)

-- 

Gain on sale of assets

-- 

5,526,000 

-- 

5,526,000 

Total other income

101,000 

5,581,000 

298,000 

5,575,000 

Net loss

(8,767,000)

(2,288,000)

(23,535,000)

(12,174,000)

Other comprehensive income (loss)-- unrealized income (loss)

6,000 

(5,000)

(18,000)

9,000 

Comprehensive loss

$ (8,761,000)

$ (2,293,000)

$(23,553,000)

$ (12,165,000)

Basic and diluted net loss per common share

$ (0.53)

$ (0.15)

$ (1.48)

$ (0.84)

Basic and diluted weighted average common shares

16,641,423 

15,177,020 

15,891,674 

14,512,898 

Consolidated Condensed Statements of Cash Flows

(Unaudited)

For the Nine Months Ended September 30,

2006 

2005 

Cash flows from operating activities:

Net loss

$ (23,535,000)

$ (12,174,000)

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization

1,605,000 

1,290,000 

Inventory provision

70,000 

178,000 

(Reduction in ) addition to allowance for doubtful accounts

(5,000)

1,000 

Change in fair value of option liabilities

(3,514,000)

984,000 

Stock-based compensation expense

2,652,000 

404,000 

Stock issued for license amendment, related party

487,000 

-- 

Equity loss from investment in joint venture

68,000 

-- 

Gain on sale of assets

-- 

(5,526,000)

Increases (decreases) in cash caused by changes in operating assets and liabilities:

Accounts receivable

718,000 

(21,000)

Inventories

(22,000)

(61,000)

Other current assets

(160,000)

200,000 

Other assets

5,000 

(206,000)

Accounts payable and accrued expenses

(1,766,000)

1,646,000 

Deferred revenues, related party

11,817,000 

7,811,000 

Deferred revenues

(149,000)

(20,000)

Long-term deferred rent

258,000 

-- 

Net cash used in operating activities

(11,471,000)

(5,494,000)

Cash flows from investing activities:

Proceeds from sale and maturity of short-term investments

53,264,000 

36,788,000 

Purchases of short-term investments

(50,278,000)

(33,484,000)

Purchases of property and equipment

(2,214,000)

(1,052,000)

Investment in joint venture

(150,000)

-- 

Net cash provided by investing activities

622,000 

2,252,000 

Cash flows from financing activities:

Principal payments on long-term obligations

(714,000)

(719,000)

Proceeds from exercise of employee stock options and warrants

819,000 

207,000 

Proceeds from sale of common stock

16,352,000 

3,003,000 

Proceeds from issuance of options

-- 

186,000 

Net cash provided by financing activities

16,457,000 

2,677,000 

Net increase (decrease) in cash and cash equivalents

5,608,000 

(565,000)

Cash and cash equivalents at beginning of period

8,007,000 

2,840,000 

Cash and cash equivalents at end of period

$ 13,615,000 

$ 2,275,000 

Source: Business Wire

More News in this Category