Lineage Cell Therapeutics(LCTX) - 2021 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Total revenues for Q4 2021 were approximately $1.2 million, an increase of $0.8 million from the same period in 2020, primarily due to increased royalties and licensing fees [43] - Total operating expenses for Q4 2021 were approximately $29.2 million, an increase of approximately $23.1 million compared to Q4 2020, driven by $21 million in accruals related to the Roche deal [43] - The net loss attributable to Lineage for Q4 2021 was $29 million, or $0.17 per share, compared to a net loss of $2 million, or $0.01 per share, for the same period in 2020 [44] - For the full year 2021, total revenues were approximately $4.3 million, an increase of $2.5 million compared to 2020 [45] - The net loss for 2021 was $43 million, or $0.26 per share, compared to a net loss of $20.6 million, or $0.14 per share, for 2020 [45] Business Line Data and Key Metrics Changes - The Roche collaboration is expected to provide up to $620 million in additional cash payments based on developmental, regulatory, and commercial milestones, along with tiered double-digit royalties [17] - The company anticipates moving towards additional clinical trials for its other programs in 2022, leveraging the knowledge gained from the OpRegen program [15][30] Market Data and Key Metrics Changes - The company acknowledges that the biotech sector is currently experiencing a significant bear market, impacting share prices across the industry [24] - Despite the market conditions, the company believes it is well-positioned due to its strong balance sheet and ongoing clinical progress [25] Company Strategy and Development Direction - The company aims to be a leader in cell therapy by demonstrating that off-the-shelf cells can deliver compelling safety and efficacy data [35] - Future product development is expected to be faster, cheaper, and easier due to lessons learned from the OpRegen program [28] - The company plans to broaden its regenerative medicine pipeline and is preparing to announce a new product opportunity later this month [33] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the Roche partnership, viewing it as a validation of their technology and a pathway to significant market opportunities [12] - The company is focused on advancing its current pipeline while exploring strategic expansions in areas where it can make a significant impact [35] - Management highlighted the importance of maintaining a disciplined approach to capital spending, with a focus on achieving value-creating milestones [48] Other Important Information - The company reported a cash balance of $83 million as of January 2022, reflecting the receipt of the Roche upfront payment [41] - The company intends to continue its efficient spending strategy while preparing for increased net spending in 2022 to advance its clinical programs [48] Q&A Session Summary Question: How will success be measured for the OPC1 trial? - The next trial for OPC1 will focus on validating a new delivery device, with an emphasis on safety and precise delivery control [57] Question: Will the outcomes differ based on the cause of cell loss? - Management confirmed that different indications will have unique characteristics, and timing of intervention is crucial for success [61][64] Question: What is the justification for delays in the OPC1 and VAC programs? - Delays were primarily due to resource allocation towards completing the Roche agreement, but development is expected to accelerate now [73][77] Question: Can Lineage commercialize OPC1 independently? - Management believes that with the right formulation and device, Lineage could handle commercialization of OPC1 [90] Question: Will future milestone payments follow a similar split as the Roche agreement? - Yes, future milestone payments are expected to follow a similar structure as the Roche agreement [94]