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Orgenesis First Quarter 2019 Revenue Increases 177% to a Record $7.3 Million

1150 Days ago

Company Expands Point of Care Platform; Benefits from Growing Cell and Gene Therapy Market

GERMANTOWN, Md., May 09, 2019 (GLOBE NEWSWIRE) -- Orgenesis Inc. (NASDAQ: ORGS) (“Orgenesis” or the “Company”), a developer, manufacturer and service provider of advanced cell therapies, today reported financial results and provided a business update for the fiscal first quarter ended March 31, 2019.  As a result of the Company’s change in its fiscal year end from November 30 to December 31, the Company is reporting a December 2018 fiscal month transition period and is comparing the results for the three months ended March 31, 2019, to the three months ended February 28, 2018.

Fiscal Q1 2019 financial highlights include:

  • Revenue increased 177% to $7.3 million, as compared to $2.6 million for the three months ended February 28, 2018
  • Gross profit increased 198% to $3.0 million, as compared to $992,000 for the three months ended February 28, 2018
  • Ended quarter with $14.4 million of cash and approximately $21.4 million of shareholders’ equity

Vered Caplan, CEO of Orgenesis, commented, “Our financial performance is indicative of the rapid growth in the cell and gene therapy market. The revenue increase we are experiencing at Orgenesis is a direct result of the expanding capacity of our Contract Development and Manufacturing Organization (“CDMO”) business to meet the growing demand by providing high quality services to our client base.”

“We have made significant strides with respect to our Point of Care (“POCare”) platform,” said Ms. Caplan. “We have aligned ourselves with key regional partners in order to establish a network of leading healthcare facilities to enable our autologous cell therapy platform.  This division is driving further value for Orgenesis shareholders through collaboration and out licensing agreements.  We believe this additional value will become increasingly visible in our future financial performance.”

“We achieved strong year-over-year revenue growth of 177%, with revenue increasing to a record $7.3 million for the first quarter of 2019.  In order to meet the growing demand for our CDMO services, we are establishing a new, state-of-the-art production site within the Gosselies Biopark in Belgium, which will expand our CDMO capacity with the goal of serving the needs of commercial-stage customers.  We are also establishing a new 30,000 square foot manufacturing facility in Houston, Texas, to dramatically expand our presence within North America,” said Caplan.

Through its POCare platform, Orgenesis continues to align with regional partners in order to establish a network of leading healthcare facilities to develop autologous cell and gene therapies.  Orgenesis recently entered into an out licensing and collaboration agreement with HekaBio K.K. for Japan.  Orgenesis entered into an agreement with TheraCell for the clinical development and commercialization of cell and gene therapies in certain European countries and recently announced an agreement with Columbia University to develop a cellular vaccination product platform for pancreatic, hepatic and cholangiocarcinoma cancers.  Orgenesis also partnered with ExcellaBio for exosome related technologies, as well as Digilab to develop industrial 3D printing capability for cellular structures and tissues for clinical use.

About Orgenesis

Orgenesis is a biotechnology company specializing in the development, manufacturing and provision of technologies and services in the cell and gene therapy industry.  The Company operates through two platforms: (i) a POCare cell therapy platform (“PT”) and (ii) a CDMO platform conducted through its subsidiary, Masthercell Global.  Through its PT business, the Company’s aim is to further the development of Advanced Therapy Medicinal Products (“ATMPs”) through collaborations and in-licensing with other pre-clinical and clinical-stage biopharmaceutical companies and research and healthcare institutes to bring such ATMPs to patients.  The Company out-licenses these ATMPs through regional partners to whom it also provides regulatory, pre-clinical and training services to support their activity in order to reach patients in a point-of-care hospital setting.  Through the Company’s CDMO platform, it is focused on providing contract manufacturing and development services for biopharmaceutical companies.  The CDMO platform operates through Masthercell Global, which currently consists of MaSTherCell in Belgium, Atvio in Israel and subsidiaries in South Korea and in the United States, each having unique know-how and expertise for manufacturing in a multitude of cell types.  Additional information 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, the success of our reorganized CDMO operations, the success of our partnership with Great Point Partners, our ability to achieve and maintain overall profitability, the sufficiency of working capital to realize our business plans, the development of our transdifferentiation technology as therapeutic treatment for diabetes which could, if successful, be a cure for Type 1 Diabetes; our technology not functioning as expected; our ability to retain key employees; our ability to satisfy the rigorous regulatory requirements for new procedures; our competitors developing better or cheaper alternatives to our products 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 November 30, 2018, 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.

Contact for Orgenesis:
David Waldman
Crescendo Communications, LLC
Tel: 212-671-1021

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(U.S. Dollars in Thousands)

      As of
      March 31,
    December 31,
    November 30,
CURRENT ASSETS:                  
Cash and cash equivalents   $ 14,361   $ 14,612   $ 16,064
Restricted cash     401     387     392
Accounts receivable, net     5,975     3,226     4,151
Prepaid expenses and other receivables     986     1,132     913
GPP receivable, see note 5     -     6,600     6,600
Grants receivable     217     441     441
Inventory     1,992     1,660     1,736
Total current assets     23,932     28,058     30,297
NON-CURRENT ASSETS:                  
Deposits     569     143     85
Loans to related party, see note 5     2,033     1,012     1,007
Property and equipment, net     12,783     12,458     11,901
Intangible assets, net     15,823     16,642     16,700
Operating lease right-of-use assets     14,354     -     -
Goodwill     15,002     15,266     15,165
Other assets     274     297     292
Total non-current assets     60,838     45,818     45,150
TOTAL ASSETS   $ 84,770   $ 73,876   $ 75,447


(U.S. Dollars in Thousands)

        As of
        March 31,
    December 31,
    November 30,
Liabilities and Equity                          
CURRENT LIABILITIES:                          
Accounts payable     $ 5,522     $ 4,583     $ 3,804  
Accrued expenses and other payables       1,525       1,499       2,060  
Employees and related payables       3,034       3,052       3,006  
Related parties       92       -       -  
Advance payments on account of grant       1,510       1,603       1,724  
Short-term loans and current maturities of long- term loans       631       641       647  
Contract liabilities       7,533       5,175       5,317  
Current maturities of long-term finance leases       232       226       209  
Current maturities of operating leases       1,291       -       -  
Current maturities of convertible loans       382       382       378  
Total current liabilities       21,752       17,161       17,145  
LONG-TERM LIABILITIES:                          
Non-current operating leases       11,816       -       -  
Loans payable       1,510       1,633       1,662  
Convertible loans       1,242       1,214       1,038  
Retirement benefits obligation       304       280       265  
Deferred taxes       1,578       1,656       1,702  
Long-term finance leases       641       661       638  
Other long-term liabilities       293       297       195  
Total long-term liabilities       17,384       5,741       5,500  
TOTAL LIABILITIES       39,136       22,902       22,645  
REDEEMABLE NON-CONTROLLING                          
INTEREST       24,233       24,224       24,153  
Common stock of $0.0001 par value, 145,833,334 shares authorized, 16,102,000, 15,540,333 and 14,951,783 shares issued and outstanding as of March 31, 2019, December 31, 2018 and November 30, 2018, respectively
      2       2       1  
Additional paid-in capital       94,049       90,597       88,082  
Receipts on account of shares to be allotted       -       -       2,253  
Accumulated other comprehensive income       185       669       425  
Accumulated deficit       (73,474 )     (65,163 )     (62,411 )
Equity attributable to Orgenesis Inc.       20,762       26,105       28,350  
Non-controlling interest       639       645       299  
Total equity       21,401       26,750       28,649  
TOTAL LIABILITIES AND EQUITY     $ 84,770     $ 73,876     $ 75,447  


(U.S. Dollars in Thousands, Except Share and Loss Per Share Amounts)

    Three Months Ended     Transition Period One-Month Ended
      March 31,     February 28,     December 31,
  2019   2018   2018  
REVENUES   $ 7,301     $ 2,636     $ 1,852  
COST OF REVENUES     4,344       1,644       1,221  
GROSS PROFIT     2,957       992       631  
RESEARCH AND DEVELOPMENT EXPENSES, net     5,150       766       1,431  
AMORTIZATION OF INTANGIBLE ASSETS     517       436       179  
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES     5,600       3,344       1,984  
OTHER INCOME, net     (37 )     (316 )     -  
OPERATING LOSS     8,273       3,238       2,963  
FINANCIAL EXPENSES, net     140       2,681       27  
LOSS BEFORE INCOME TAXES     8,413       5,873       2,990  
TAX (INCOME) EXPENSES     37       (396 )     (83 )
NET LOSS     8,450       5,477       2,907  
NET LOSS ATTRIBUTABLE TO ORGENESIS INC.     8,311       5,611       2,744  
LOSS PER SHARE:                        
Basic   $ 0.55     $ 0.52     $ 0.19  
Diluted   $ 0.55     $ 0.52     $ 0.19  
Basic     15,571,568       10,775,877       15,423,040  
Diluted     15,571,568       10,775,877       15,423,040  
COMPREHENSIVE LOSS:                        
Net loss   $ 8,450     $ 5,477     $ 2,907  
Other comprehensive (income) loss - translation  adjustments     484       (707 )     (244 )
Comprehensive loss     8,934       4,770       2,663  
Comprehensive (income) loss attributed to non-controlling interests (including redeemable)     (139 )     134       (163 )
COMPREHENSIVE LOSS ATTRIBUTED TO ORGENESIS INC.   $ 8,795     $ 4,904     $ 2,500  

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