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Athersys Reports Fourth Quarter and 2012 Annual Results



Athersys Reports Fourth Quarter and 2012 Annual Results

Management to Host Conference Call at 4:30pm EDT Today

CLEVELAND, March 12, 2013 (GLOBE NEWSWIRE) -- Athersys, Inc. (Nasdaq:ATHX)
today announced its financial results for the fourth quarter and year ended
December 31, 2012.

Fourth Quarter and 2012 Highlights:

  * Raised $21.2 million net proceeds in the fourth quarter, including the
    full exercise of underwriters' over-allotment option, in a public offering
    of common stock to be used for working capital and general corporate
    purposes, including funding for ongoing clinical trials;
  * Continued Phase II clinical study with partner, Pfizer, involving
    administration of MultiStem^® cells to patients suffering from ulcerative
    colitis. This double blind, placebo-controlled trial will include
    approximately 130 patients with initial results expected in second half of
    2013;
  * Advanced our Phase II clinical study of the administration of the
    MultiStem cell product to patients who have suffered ischemic stroke into
    large efficacy cohort of this double blind, placebo-controlled trial of
    136 patients;
  * Developed and submitted to FDA a clinical trial plan for conducting a
    Phase II-III study of MultiStem administration intended to both reduce the
    incidence and severity of graft-versus-host disease, or GvHD, and provide
    other benefits for patients undergoing hematopoietic stem cell
    transplantation;
  * Received ten new patents during 2012 covering aspects of the Company's
    cell therapy technology, including issuances in the United States and
    other important jurisdictions;
  * Published five articles in quality, peer-reviewed journals during 2012,
    further describing the MultiStem cells' mechanisms of action and potential
    applications, as well as the breadth of our third party research
    collaborations;
  * Named for second year to Deloitte's Technology Fast 500™, the fastest
    growing technology, media, telecommunications, life sciences and clean
    technology companies in North America;
  * Advanced partnering discussions on both the development of novel small
    molecule therapies to treat obesity and other conditions such as
    schizophrenia, acting through stimulation of the 5HT2c receptor, and on
    certain regenerative medicine programs;
  * Recorded revenues of $2.3 million and a net loss of $3.2 million for this
    quarter ended December 31, 2012, and for the year ended December 31, 2012,
    recorded revenues of $8.7 million and a net loss of $14.7 million; and
  * Ended the year with $25.5 million in cash and cash equivalents.

"We continue to focus our resources on developing MultiStem for the treatment
and prevention of diseases and conditions where there is a significant unmet
medical need," said Gil Van Bokkelen, Ph.D., Chairman and Chief Executive
Officer.  "Our key programs address the potential benefit of MultiStem to
treat neurological conditions, inflammatory and immune disorders, and
cardiovascular disease. Success in any of these indications could open up a
broader set of opportunities for Athersys and our partners in related areas.

"A successful fundraising in the fourth quarter generated $21.2 million in net
proceeds from the sale of common stock to new and existing investors.  As a
result, our current financial position enables us to continue to fund
important clinical development, as well as to pursue partnership and new
business opportunities," added Dr. Van Bokkelen.

"During the quarter, our partner, Pfizer, continued to advance our ongoing
Phase II clinical trial in inflammatory bowel disease. We also initiated the
third and final cohort of a double-blind, placebo-controlled Phase II clinical
trial to evaluate the administration of MultiStem to patients who have
suffered a moderate to moderately severe ischemic stroke. This initiation
followed an independent safety monitoring committee review that found that
MultiStem was safe and well tolerated in both high and low dosages in the
initial patient treatment groups.

"In a significant extension of the treatment window currently required by
standard of care, we are treating patients one to two days after the stroke
has occurred, which we believe is a clinically practical time frame.  In our
previously published work, we have seen that the administration of a single
dose of MultiStem in preclinical models even several days after a stroke
resulted in significant and durable recovery.

"In sum, we believe the continued execution of our clinical and preclinical
programs, the advancement of existing collaborations, and the implementation
of new partnerships will enable us to deliver substantial long-term value for
our shareholders," concluded Dr. Van Bokkelen.

Fourth Quarter
Results                                                                                                         

Revenues for the three months ended December 31, 2012 were $2.3 million as
compared to $2.6 million in the comparable period in 2011. The decrease
reflects lower contract revenues from our collaboration with Pfizer Inc. due
to the end of the research performance period in June 2012. Included in the
fourth quarter 2012 revenues is approximately $1.9 million related to
milestone and technical support payments from our collaboration with RTI
Biologics, Inc.  Research and development expenses decreased to $4.9 million
in 2012, as compared to $5.6 million in the fourth quarter of 2011, primarily
due to reduced clinical development expenses during the period. General and
administrative expenses were $1.3 million for the three months ended December
31, 2012 and $1.2 million in the comparable period in 2011. Income from the
change in the fair value of our warrant liabilities was $1.1 million for the
three months ended December 31, 2012 and $0.1 million in the comparable period
in 2011. Net loss for the three months ended December 31, 2012 was $3.2
million compared to $4.3 million for the same period of 2011. At December 31,
2012, we had $25.5 million in cash and cash equivalents.

2012 Annual Financial Results

For the year ended December 31, 2012, revenues decreased to $8.7 million from
$10.3 million in 2011, primarily due to reduced revenues from our
collaboration with Pfizer. Research and development expenses increased to
$19.6 million in 2012 from $18.9 million in 2011 due to increased clinical and
preclinical development costs, personnel costs and research supplies,
partially offset by decreased patent legal fees. General and administrative
expenses decreased to $4.8 million in 2012 from $4.9 million in 2011. Income
from the change in the fair value of our warrant liabilities was $2.4
million in 2012 and $0.8 million in 2011.  Net other expenses were $1.2
million in 2012 and $0.9 in 2011, which consists primarily of the final cash
and stock-based milestone payments to our former lenders.  Cash used in
operating activities was $17.7 million and $14.5 million in 2012 and 2011,
respectively. Net loss was $14.7 million in 2012 compared to $13.7 million in
2011.

Conference Call

As previously announced, Gil Van Bokkelen, Chairman and Chief Executive
Officer, and William (B.J.) Lehmann, President and Chief Operating Officer,
will host a conference call today to review the results as follows:

                                     
Date                                March 12, 2013
Time                                4:30 p.m. (Eastern Time)
Telephone access: U.S. and Canada   800-273-1254
 
Telephone access: International     973-638-3440
Access code                         95456637
Live webcast                        www.athersys.com, under the Investors
                                    section

A replay will be available for on-demand listening shortly after the
completion of the call until 11:59 PM (Eastern Time) on March 28, 2013, by
dialing 800-585-8367 or 855-859-2056 (U.S. and Canada), or 404-537-3406, and
entering access code 95456637. The archived webcast will be available for one
year at the aforementioned URL.

About Athersys

Athersys is a clinical stage biotechnology company engaged in the discovery
and development of therapeutic product candidates designed to extend and
enhance the quality of human life. The Company is developing its MultiStem^®
cell therapy product, a patented, adult-derived "off-the-shelf" stem cell
product platform for disease indications in the cardiovascular, neurological,
inflammatory and immune disease areas. The Company currently has several
clinical stage programs involving MultiStem, including for treating
inflammatory bowel disease, ischemic stroke, damage caused by myocardial
infarction, and for the prevention of graft-versus-host disease. Athersys has
also developed a diverse portfolio that includes other technologies and
product development opportunities, and has forged strategic partnerships and
collaborations with leading pharmaceutical and biotechnology companies, as
well as world-renowned research institutions in the United States and Europe
to further develop its platform and products. More information is available at
www.athersys.com.

The Athersys, Inc. logo is available at:
http://www.globenewswire.com/newsroom/prs/?pkgid=4548

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995 that involve risks and
uncertainties. These forward-looking statements relate to, among other things,
the expected timetable for development of our product candidates, our growth
strategy, and our future financial performance, including our operations,
economic performance, financial condition, prospects, and other future events.
We have attempted to identify forward-looking statements by using such words
as "anticipates," "believes," "can," "continue," "could," "estimates,"
"expects," "intends," "may," "plans," "potential," "should," "suggest,"
"will," or other similar expressions. These forward-looking statements are
only predictions and are largely based on our current expectations. A number
of known and unknown risks, uncertainties, and other factors could affect the
accuracy of these statements. Some of the more significant known risks that we
face that could cause actual results to differ materially from those implied
by forward-looking statements are the risks and uncertainties inherent in the
process of discovering, developing, and commercializing products that are safe
and effective for use as human therapeutics, such as the uncertainty regarding
market acceptance of our product candidates and our ability to generate
revenues, including MultiStem for the treatment of inflammatory bowel disease,
acute myocardial infarction, stroke and other disease indications, including
lysosomal storage disorders, and the prevention of graft-versus-host disease.
These risks and uncertainties may cause our actual results, levels of
activity, performance, or achievements to differ materially from any future
results, levels of activity, performance, or achievements expressed or implied
by these forward-looking statements. Other important factors to consider in
evaluating our forward-looking statements include: our ability to raise
additional capital; final results from our MultiStem clinical trials; the
possibility of delays in, adverse results of, and excessive costs of the
development process; our ability to successfully initiate and complete
clinical trials and obtain all necessary regulatory approvals; changes in
external market factors; changes in our industry's overall performance;
changes in our business strategy; our ability to protect our intellectual
property portfolio; our possible inability to realize commercially valuable
discoveries in our collaborations with pharmaceutical and other biotechnology
companies; our ability to meet milestones under our collaboration agreements;
our collaborators' ability to continue to fulfill their obligations under the
terms of our collaboration agreements; the success of our efforts to enter
into new strategic partnerships and advance our programs; our possible
inability to execute our strategy due to changes in our industry or the
economy generally; changes in productivity and reliability of suppliers; and
the success of our competitors and the emergence of new competitors. You
should not place undue reliance on forward-looking statements contained in
this press release, and we undertake no obligation to publicly update
forward-looking statements, whether as a result of new information, future
events or otherwise.

Athersys, Inc.
Condensed Consolidated Balance Sheets
(In thousands)
                                                                 
                                                 December 31,   December 31,
                                                 2012           2011
                                                 (Unaudited)    (Note)
Assets                                                           
Cash, cash equivalents and                       $25,533        $12,784
available-for-sale securities
Other current assets                             776            1,650
Equipment, net                                   1,294          1,267
                                                                 
Total assets                                     $27,603        $15,701
                                                                 
Liabilities and stockholders' equity                             
Accounts payable and accrued expenses            $4,478         $4,280
Deferred revenue                                 --             3,140
Warrant liabilities and note payable             2,878          983
Total stockholders' equity                       20,247         7,298
Total liabilities and stockholders' equity       $27,603        $15,701
                                                                 
Note:   The Condensed Consolidated Balance Sheet Data has been derived from
the audited financial statements as of that date.

 
 
Athersys, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Loss
(In thousands, except share and per share data)
 
(Unaudited)
 
                                                        
                                 Three months ended    Twelve months ended
                                 December 31,          December 31,
                                 2012       2011       2012        2011
Revenues                                                            
Contract revenue                 $2,024     $2,303     $7,380      $9,015
Grant revenue                    265        262        1,328       1,329
Total revenues                   2,289      2,565      8,708       10,344
                                                                    
Costs and expenses                                                  
Research and development          4,935      5,570      19,636      18,930
General and administrative        1,253      1,195      4,753       4,916
Depreciation                      84         76         320         278
Total costs and expenses          6,272      6,841      24,709      24,124
Loss from operations              (3,983)    (4,276)    (16,001)    (13,780)
Other expense, net                (320)      (101)      (1,172)     (863)
Income from change in fair value  1,053      118        2,404       812
of warrants
Interest income                   13         7          34          85
Net loss                          $ (3,237)  $ (4,252)  $ (14,735)  $ (13,746)
                                                                    
Basic and diluted net loss per    $ (0.07)   $ (0.18)   $ (0.45)    $ (0.59)
share
                                                                    
Weighted average shares          45,363,029 24,049,035 32,556,781  23,239,019
outstanding, basic and diluted
                                                                    
Other comprehensive loss:                                           
Other comprehensive (loss)       --         --          (28)       2
income items
Comprehensive loss                $ (3,237)  $ (4,252)  $ (14,763)  $ (13,744)

CONTACT: William (B.J.) Lehmann, J.D.
         President and Chief Operating Officer
         Tel: (216) 431-9900
         bjlehmann@athersys.com
        
         Investor Relations:
         Lisa M. Wilson
         In-Site Communications
         Tel: (917) 543-9932
         lwilson@insitecony.com

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