Orgenesis Provides Year End Business Update
*M**ajor transformation underway **commencing with* *recent **acquisition
**reasserting* *full **ownership and **control **over** Octomera*
*Secured **a $2.**3 million **investment from a group **including* *sophisticated healthcare **professiona**ls **at $1.03** per share** and accompanying warrants**, a more than 50% premium to prior**-**day closing price*
*Entered* *into **asset purchase **and **strategic collaboration agreement **which will provide **Octomera **with **over **$8** million **of *initial collaboration payments* *
GERMANTOWN, Md., April 15, 2024 (GLOBE NEWSWIRE) -- * **Orgenesis Inc**. (NASDAQ: ORGS)* (“Orgenesis” or the “Company”), a global biotech company working to unlock the full potential of cell and gene therapies (CGT) in order to improve access and outcomes in healthcare, today provided a business update for the year ended December 31, 2023.
“Orgenesis is a company that has set as its goal to make cell and gene therapies available and affordable. The cell and gene industry has continued to grow year over year driven by the curative potential of these groundbreaking therapies, and yet, the challenges of reducing costs of products and the ability to enable quick expansion of production capacity have not been overcome,” commented Vered Caplan, CEO of Orgenesis. “The Company has pioneered decentralized production for these personalized therapies by setting up what we believe is the only existing global decentralized production platform with a capability to accommodate a wide-range of therapies. We continue to invest in expanding the platform and validating our decentralized approach so that it can serve as a viable and cost-effective solution to the industry.”
“Unfortunately, the last year was an extremely difficult one for the industry. Although there has been widespread acceptance of the field with multiple approvals of new products, the lack of funding has hit early-stage development companies the hardest. A majority of Octomera’s customers fall into the early-stage category. Many of them are innovative companies that are developing potentially lifesaving therapies that have based their entire development on a decentralized strategy and invested millions of dollars by means of service payments to Octomera.”
“Even as we continue to engage these customers, we are taking a conservative accounting approach as to their future outlook. We remain hopeful that, as the funding environment improves, they will secure additional funding and thank them for their bedrock support in turning decentralized supply into a reality for the industry. Moreover, with new regulatory initiatives underway that align with our decentralized approach, we believe both the public and private sectors are now acutely aware of the need to address industry-wide capacity and cost constraints. Stakeholders are realizing that decentralized production is an undeniable reality, making it not only a viable option, but a critical pathway for the long-term success of this industry.”
”We are appreciative of our dedicated employees, suppliers, partners and investors who have stood by us, realizing both our potential and the significance of our achievements. With their unwavering support, we have not only survived, but are poised for growth, with major initiatives now underway that we expect will transform the Company.”
“Looking forward, our first major step in the transformation was the recent transaction to regain 100% ownership of Octomera, our strategic CGT processing subsidiary. We believe that the Octomera platform featuring the Orgenesis Mobile Processing Units and Labs (OMPULs)not only provides a synergistic solution for our products, but provides the wider industry a rapid, standardized industrial cleanroom alternative at or near the point of care, which can be rapidly deployed and scaled at a significantly lower cost than centralized production.”
“Leveraging our decentralized services platform, we are advancing our therapeutic pipeline with a focus on our immune-oncology portfolio while leveraging non-dilutive grants to fund a significant portion of our activities. As a recent example of the broad pipeline of grants awarded but not fully spent, an Orgenesis’ consortium was awarded two grants from the Walloon Government in Belgium for a total of €3.5M EUR to advance technologies for the decentralized production of Advanced Therapy Medicinal Products (ATMPs), as well as the development of therapeutic exosomes that can be utilized for immuno-oncology, gene and cell therapies, and tissue regeneration."
"Most notably, the grant funding accelerates the placement of a CAR-T dedicated OMPUL in Belgium, an important step in making more affordable and more advanced CAR-T therapies available in the region. Overall, we believe our therapeutic pipeline holds substantial potential and we look forward to announcing upcoming developments that will shed further light on our immuno-oncology progress and plans.”
Victor Miller, Chief Financial Officer of Orgenesis, further noted, “To support our growth plans, we recently secured an investment of $2.3 million from a group of accredited investors, including a group of sophisticated, long-term healthcare professionals,at a purchase price of $1.03 per share and accompanying warrants, which was a more than 50% premium to the prior day closing price, which we believe is a strong validation of our business model. We also entered into a strategic collaboration agreement that we believe will substantially enhance our ability to meet the demand for OMPULs and add a commercial footprint to service our customers. Under this 10-year strategic collaboration agreement, our partner will manufacture, co-market, distribute and service OMPULs. The $8,340,000 non-dilutive payments to be paid under the agreement reduces our capital requirements while accelerating the rollout of OMPULs around the world.”
“I am encouraged by the global demand I have witnessed firsthand, coupled with our cell processing expertise and the extraordinary talent that has been assembled within the organization. We are rapidly advancing our proprietary portfolio of potential therapies, which have the potential to help make our goal of improving access and outcomes in healthcare a reality. We believe that we are now on more solid financial footing having already received collaboration payments in excess of $6 million. We look forward to unleashing Orgenesis’ full potential in our efforts to optimize shareholder value.”
The complete financial results for the fourth quarter and year ended December 31, 2023 are available on the Company’s website in the Company’s Annual Report on Form 10-K, which has been filed with the Securities and Exchange Commission.
*About Orgenesis*
Orgenesis is a global biotech company that has been committed to unlocking the potential of cell and gene therapies (CGTs) since 2012 as well as a paradigm-shifting decentralized approach to processing since 2020. This new model allows Orgenesis to bring academia, hospitals, and industry together to make these essential therapies a reality sooner rather than later. Orgenesis is focusing on advancing its CGTs toward eventual commercialization, while partnering with key industry stakeholders to provide a rapid, globallyharmonized pathway for these therapies to reach and treat a larger numbers of patients more cost effectively and with better outcomes through great science and decentralized production. Additional information about the Company 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, our reliance on, and our ability to grow, our point-of-care cell therapy platform and OMPUL business, our ability to achieve and maintain overall profitability, our ability to manage our research and development programs that are based on novel technologies, our ability to control key elements relating to the development and commercialization of therapeutic product candidates with third parties, the timing of completion of clinical trials and studies, the availability of additional data, outcomes of clinical trials of our product candidates, the potential uses and benefits of our product candidates, our ability to manage potential disruptions as a result of the COVID-19 pandemic, the sufficiency of working capital to realize our business plans and our ability to raise additional capital, the development of our POCare strategy, our trans differentiation technology as therapeutic treatment for diabetes, the technology behind our in-licensed ATMPs not functioning as expected, our ability to further our CGT development projects, either directly or through our JV partner agreements, and to fulfill our obligations under such agreements, our license agreements with other institutions, our ability to retain key employees, our competitors developing better or cheaper alternatives to our products, risks relating to legal proceedings against us 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 December 31, 2023, 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.
*IR contact for Orgenesis:*
Crescendo Communications, LLC
Tel: 212-671-1021
Orgs@crescendo-ir.com
*Communications contact for Orgenesis*
IB Communications
Neil Hunter / Michelle Boxall
Tel +44 (0)20 8943 4685
neil@ibcomms.agency / michelle@ibcomms.agency
(tables follow)
*ORGENESIS INC.
*CONSOLIDATED BALANCE SHEETS*
*(U.S. Dollars, in thousands)** *December 31,* *2023* *202**2*
*CURRENT ASSETS:*
Cash and cash equivalents $ 837 $ 5,311
Restricted cash 642 1,058
Accounts receivable, net of credit losses of $0 88 36,183
Prepaid expenses and other receivables 2,017 958
Receivables from related parties 458 -
Convertible loan - 2,688
Inventory 34 120
Total current assets 4,076 46,318
*NON CURRENT ASSETS:*
Deposits $ 38 $ 331
Equity investees 8 39
Loans to associates - 96
Property, plants and equipment, net 1,475 22,834
Intangible assets, net 7,375 9,694
Operating lease right-of-use assets 351 2,304
Goodwill 1,211 8,187
Deferred tax - 103
Other assets 18 1,022
Total non-current assets 10,476 44,610
*TOTAL ASSETS* $ 14,552 $ 90,928 *CONSOLIDATED BALANCE SHEETS
*(U.S. Dollars, in thousands)** *December 31,* *2023* *2022*
*CURRENT LIABILITIES:*
Accounts payable $ 6,451 $ 4,429
Accounts payable related Parties 133 -
Accrued expenses and other payables 2,218 2,648
Income tax payable 740 289
Employees and related payables 1,079 1,860
Other payable related parties 52 -
Advance payments on account of grant 2,180 1,578
Short-term loans 650 -
Current maturities of finance leases 18 60
Current maturities of operating leases 216 542
Short-term and current maturities of convertible loans 2,670 4,504
*TOTAL CURRENT LIABILITIES* 16,407 15,910
*LONG-TERM LIABILITIES:*
Non-current operating leases $ 96 $ 1,728
Convertible loans 18,967 13,343
Retirement benefits obligation - 163
Finance leases 4 95
Other long-term liabilities 61 415
*TOTAL LONG-TERM LIABILITIES* 19,128 15,744
*TOTAL LIABILITIES* 35,535 31,654
*REDEEMABLE NON-CONTROLLING INTEREST* - 30,203
*EQUITY (CAPITAL DEFICIENCY):*
Common stock of $0.0001 par value:
Authorized at December 31, 2023 and December 31, 2022: 145,833,334 shares; Issued at December 31, 2023 and December 31, 2022: 32,163,630 and 25,832,322 shares, respectively; Outstanding at December 31, 2023 and December 31, 2022: 31,877,063 and 25,545,755 shares, respectively. 3 3
Additional paid-in capital 156,837 150,355
Accumulated other comprehensive income (loss) 65 (270 )
Treasury stock 286,567 shares as of December 31, 2023 and December 31, 2022 (1,266 ) (1,266 )
Accumulated deficit (176,622 ) (121,261 )
Equity attributable to Orgenesis Inc. (20,983 ) 27,561
Non-controlling interests - 1,510
*TOTAL EQUITY (CAPITAL DEFICIENCY)* (20,983 ) 29,071
*TOTAL LIABILITIES, REDEEMABLE NON-CONTROLLING INTEREST AND EQUITY (CAPITAL DEFICIENCY)* $ 14,552 $ 90,928 *ORGENESIS INC.
*CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (INCOME)*
*(U.S. Dollars, in thousands, except share and per share amounts)** *Years Ended December 31,* *2023* *2022*
Revenues $ 530 $ 34,741
Revenues from related party - 1,284
Total revenues $ 530 $ 36,025
Cost of revenues 6,255 5,133
Gross (loss) profit $ (5,725 ) $ 30,892
Cost of development services and research and development expenses 10,623 21,933
Amortization of intangible assets 721 911
Selling, general and administrative expenses included credit losses of $24,367 for the year ended December 31, 2023 35,134 15,589
Share in net loss of associated companies 734 1,508
Impairment of investment 699 -
Impairment of intangible assets - 1,061
Operating loss $ 53,636 $ 10,110
Loss from deconsolidation of Octomera (see Note 3) 5,343 -
Other income, net (4 ) (173 )
Credit loss on convertible loan receivable 2,688 -
Loss from extinguishment in connection with convertible loan 283 52
Financial expenses, net 2,499 1,971
Loss before income taxes $ 64,445 $ 11,960
Tax expense 473 209
Net loss $ 64,918 $ 12,169
Net (loss) income attributable to non-controlling interests (9,557 ) 2,720
Net loss attributable to Orgenesis Inc. $ 55,361 $ 14,889
*Loss per share:*
Basic and diluted $ 1.91 $ 0.59
*Weighted average number of shares used in computation of Basic and Diluted loss per share:*
Basic and diluted 29,007,869 25,096,284
*Comprehensive loss:*
Net loss $ 64,918 $ 12,169
Other Comprehensive loss – Translation adjustment 49 477
Release of translation adjustment due to deconsolidation of Octomera (384 ) -
Comprehensive loss $ 64,583 $ 12,646
Comprehensive (loss) income attributed to non-controlling interests (9,557 ) 2,720
Comprehensive loss attributed to Orgenesis Inc. $ 55,026 $ 15,366