GERMANTOWN, Md., Aug. 8, 2019 /PRNewswire/ -- Intrexon
Corporation (NASDAQ: XON), a leader in the engineering and
industrialization of biology to improve the quality of life and
health of the planet, today announced its second quarter and first
half financial results for 2019.
Recent Business Highlights:
- Precigen, Inc., a wholly owned subsidiary of Intrexon,
announced the first patient dosed with PRGN-3005, an
investigational autologous chimeric antigen receptor T (CAR‑T) cell
therapy developed using Precigen's non-viral UltraCAR‑T™
platform. PRGN-3005 UltraCAR‑T™ therapy is under
investigation for the treatment of patients with advanced,
recurrent platinum resistant ovarian, fallopian tube or primary
peritoneal cancer (clinical trial identifier: NCT03907527);
- Precigen, Inc., announced the first patient dosed with
PRGN-3006, an investigational autologous CAR‑T cell therapy
developed using Precigen's non-viral UltraCAR‑T™
platform for the treatment of patients with relapsed or refractory
acute myeloid leukemia or higher risk myelodysplastic syndrome
(clinical trial identifier: NCT03927261);
- Intrexon entered into an agreement under which it will
contribute its Methane Bioconversion Platform, together with all
its associated technologies and facilities, to MBP, LLC, a newly
formed company that will be headed by David
Dewhurst, who is purchasing equity capital in the
venture;
- Oxitec, Ltd., a wholly owned subsidiary of Intrexon,
successfully completed the first pilot project of its
2nd Generation Friendly™ Aedes aegypti
technology in Brazil, a mosquito
strain that unlocks new performance features, greater
cost-effectiveness and scalability over Oxitec's 1st
generation with limited production requirements. Oxitec's new
mosquitoes achieved excellent results in urban, dengue-prone
environments, demonstrating its ability to achieve significant
suppression with five times fewer mosquitoes. To pilot the
technology in the US, Oxitec is working with the US Environmental
Protection Agency (EPA) leadership on its Experimental Use Permit
(EUP) in preparation for implementing a pilot project in 2020 in
Florida;
- ActoBio Therapeutics, Inc., a wholly owned subsidiary of
Intrexon, announced that following a review by the independent Data
and Safety Monitoring Board (DSMB) it will progress to the next
stage of the Phase Ib/IIa clinical trial for investigational drug
AG019 for the treatment of early onset type 1 diabetes (T1D).
ActoBio Therapeutics has initiated enrollment of the next two
patient cohorts of the study: AG019 dosing in patients 12-17 years
of age and combination dosing of AG019 plus teplizumab in
adults;
- Triple-Gene LLC has proceeded to enrollment of the second
cohort of the Phase 1 clinical trial of INXN-4001, an
investigational new drug which is the world's first triple effector
gene drug candidate being evaluated for the treatment of heart
failure, following review of the first cohort data by the
DSMB;
- Intrexon Laboratories Hungary and Surterra Wellness (Surterra)
partnered in an exclusive global licensing agreement to advance
Surterra's cannabinoid production at a reliable, efficient,
cost-effective, industrial scale utilizing Intrexon's proprietary
yeast fermentation platform. The deal, including milestones and
royalties, will leverage each company's expertise to ultimately
bring new legal and ethical cannabinoid products to market to meet
growing demand, boost innovation, and improve product
development;
- Intrexon announced it is advancing its non-browning
GreenVenus™ Romaine lettuce to commercial-size
production trials as initial data under commercial indoor
production conditions indicate that it has improved shelf-life up
to 2 weeks and a potential for higher marketable yield with no tip
burn. Non-browning GreenVenus™ lettuce has also been
assessed by the United States Department of Agriculture and
determined not to be subject to regulation under 7CFR Part 340 for
plants altered or produced through genetic engineering; and
- Intrexon entered into a nonbinding letter of intent, and
received a nonrefundable cash deposit, for the sale of Exemplar
Genetics, a wholly owned subsidiary of Intrexon focused on
developing miniature swine models of human disease. The transaction
is expected to close within the next thirty days pending completion
of diligence.
Second Quarter 2019 Financial Highlights:
- Total revenues of $36.0
million;
- Net loss of $38.8 million
attributable to Intrexon, or $(0.25)
per basic share, including non-cash charges of $8.0 million; and
- Cash, cash equivalents, and short-term investments totaled
$125.8 million and the value of
common equity securities totaled $21.5
million at June 30, 2019.
First Half 2019 Financial Highlights:
- Total revenues of $59.3
million;
- Net loss of $99.5 million
attributable to Intrexon, or $(0.65)
per basic share, including non-cash charges of $28.2 million.
"Earlier this year we announced our intent to focus the
Company's business, directing capital to certain of our most
strategic programs. We also established a goal of ending the year
with approximately the same net cash and short-term investment
position that the company held on April 3,
2019, which included initiating plans to sell or partner
certain divisions and to reduce our original 2019 operating budget
by approximately $70 million,"
commented Randal J. Kirk, Chairman
and Chief Executive Officer of Intrexon.
Mr. Kirk concluded, "Based on the significant steps we have
taken with respect to the sales of certain subsidiaries and assets,
the partnering of programs, as well as operating cost reductions,
we continue to believe our goal with respect to achieving the same
net cash and short-term investment position should be
achieved. Moreover, I believe we will meet this goal while
retaining for the company the core technologies and valuable
product candidates that represent the most important future value
for our shareholders."
"We have identified and implemented significant operating cost
reductions. However, based on progress to date and the ongoing
evaluation of the Company's strategic direction and long-term best
interest, management has determined not to proceed in continuing
its efforts to achieve the full initial target of $70 million in operating cost reductions.
Instead, we will concentrate our focus on our overall net cash and
short-term investment position," added LTG (Ret.) Thomas Bostick, PhD, PE, Chief Operating Officer
of Intrexon and President, Intrexon Bioengineering.
There are risks and uncertainties inherent in forecasts of this
nature, including with respect to the challenges in identifying and
negotiating with counterparties, transactions taking longer or
generating lower proceeds than expected, changes in strategic
directions, general market developments, costs and expenses being
higher than anticipated, developments in clinical, market or
competitive data, and other factors of the type generally
applicable to the Company's business, including those discussed
under the Safe Harbor Statement below.
With regard to the agreement to build a standalone energy
company to be led by Governor Dewhurst on the foundation of
Intrexon's Methane Bioconversion Platform, Mr. Kirk further
commented, "Governor Dewhurst brings a lifetime of experience that
perfectly suits him to lead the revolution in energy that should be
made possible through our Methane Bioconversion Platform.
From his experience as an intelligence officer, in public service
(including serving as Lieutenant Governor of Texas for twelve years) and in building
successful energy companies, he has throughout demonstrated
leadership, intelligence, courage and personal integrity that
inspire and that achieve significant results. We look forward
to his leadership at MBP and to working with him to fully realize
its great potential."
"As I have followed Intrexon, I have learned to admire and
respect RJ's acumen and visionary creation to improve the quality
of life for all people. As an innovator, who has repeatedly
implemented technologies successfully, I feel driven to seize this
opportunity to work alongside RJ and the incredibly talented team
as CEO of the Methanotroph Bioconversion Platform, to build a
safer, healthier planet, and a more promising future. I'm excited
by this opportunity and dedicated to bringing together great minds
in synthetic biology with industry to solve big challenges facing
today's society," Governor Dewhurst stated.
Second Quarter 2019 Financial Results Compared to Prior Year
Period
Total revenues decreased $9.3
million from the quarter ended June
30, 2018. Collaboration and licensing revenues decreased
$8.4 million, or 48%, from the
quarter ended June 30, 2018 primarily
due to the reacquisition of rights previously licensed to some of
our most significant collaborators in the second half of 2018 and
the result of which eliminated or substantially reduced revenues
previously generated from those collaborations.
Research and development expenses decreased $7.5 million, or 18%. The 2018 amounts include
$5.3 million of one-time costs
associated with closing one of Oxitec's research and development
facilities as the Company decentralized operations previously
conducted in this facility. Additionally, depreciation and
amortization decreased $2.2 million
primarily due to intangible assets that were impaired or abandoned
in 2018. Selling, general and administrative (SG&A) expenses
decreased $12.9 million, or 38% and
of this amount, $10.6 million was
primarily attributable to decreased share-based compensation
expense which arose primarily from the departure of former
employees.
First Half 2019 Financial Results Compared to Prior Year
Period
Total revenues decreased $25.6
million from the six months ended June 30, 2018. Collaboration and licensing
revenues decreased $22.2 million, or
60%, from the six months ended June 30,
2018 primarily due to the reacquisition of rights previously
licensed to some of our most significant collaborators in the
second half of 2018 and the result of which eliminated or
substantially reduced revenues previously generated from those
collaborations. Product revenues decreased $4.0 million, or 24%, primarily due to lower
customer demand for pregnant cows, live and weaned calves, and
cloned products. Gross margin on products declined in the current
period as a result of fewer products sold, decreased sales prices,
and increased costs associated with new product offerings.
Research and development expenses decreased $11.6 million, or 15%. The 2018 amounts include
$5.3 million of one-time costs
associated with closing one of Oxitec's research and development
facilities as the Company decentralized operations previously
conducted in this facility. Additionally, depreciation and
amortization decreased $4.3 million
primarily due to intangible assets that were impaired or abandoned
in 2018. Research and development salaries, benefits and other
personnel costs decreased $2.0
million primarily due to the closing of one of Oxitec's
research and development facilities. SG&A expenses decreased
$19.1 million, or 26% and of this
amount, $15.5 million was primarily
attributable to decreased share-based compensation expense which
arose primarily from the departure of former employees.
Conference Call and Webcast
The Company will host a
conference call today Thursday, August
8th, at 5:30 PM ET
to discuss the second quarter and first half 2019 financial results
and provide a general business update. The conference call
may be accessed by dialing 1-888-317-6003 (Domestic US),
1-866-284-3684 (Canada), and
1‑412-317-6061 (International) and providing the number
4443860 to join the Intrexon Corporation Call.
Participants may also access the live webcast through Intrexon's
website in the Investors section at
http://investors.dna.com/events.
About Intrexon Corporation
Intrexon Corporation
(NASDAQ: XON) is Powering the Bioindustrial Revolution with Better
DNA™ to create biologically-based products that improve
the quality of life and the health of the planet through two
operating units – Intrexon Health and Intrexon
Bioengineering. Intrexon Health is focused on addressing
unmet medical needs through a diverse spectrum of therapeutic
modalities, including gene and cell therapies, microbial
bioproduction, and regenerative medicine. Intrexon
Bioengineering seeks to address global challenges across food,
agriculture, environmental, energy, and industrial fields by
advancing biologically engineered solutions to improve
sustainability and efficiency. Our integrated technology suite
provides industrial-scale design and development of complex
biological systems delivering unprecedented control, quality,
function, and performance of living cells. We call our synthetic
biology approach Better DNA®, and we invite you to
discover more at www.dna.com or follow us on Twitter at
@Intrexon, on Facebook, and LinkedIn.
Trademarks
Intrexon, UltraCAR-T, GreenVenus,
Friendly, Powering the Bioindustrial Revolution with Better
DNA, and Better DNA are trademarks of Intrexon and/or its
affiliates. Other names may be trademarks of their respective
owners.
Safe Harbor Statement
Some of the statements made in
this press release are forward-looking statements that involve a
number of risks and uncertainties and are made pursuant to the Safe
Harbor Provisions of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements made in this press release
include, but are not limited to, statements regarding clinical and
pre-clinical development activities by Intrexon and its
collaborators, commercial and business development plans and the
submission of regulatory filings. These forward-looking statements
are based upon Intrexon's current expectations and projections
about future events and generally relate to Intrexon's plans,
objectives and expectations for the development of Intrexon's
business. Although management believes that the plans and
objectives reflected in or suggested by these forward-looking
statements are reasonable, all forward-looking statements involve
risks and uncertainties and actual future results may be materially
different from the plans, objectives and expectations expressed in
this press release. These risks and uncertainties include, but are
not limited to, (i) Intrexon's strategy and overall approach to its
business model, its efforts to realign its business, and its
ability to exercise more control and ownership over the development
process and commercialization path; (ii) Intrexon's ability to
successfully enter new markets or develop additional products,
including the expected timing and results of investigational
studies and preclinical and clinical trials, whether with its
collaborators or independently; (iii) Intrexon's ability to
successfully enter into optimal strategic relationships with its
subsidiaries and operating companies that it may form in the
future; (iv) Intrexon's ability to hold or generate significant
operating capital, including through partnering, asset sales and
operating cost reductions; (v) actual or anticipated variations in
Intrexon's operating results; (vi) actual or anticipated
fluctuations in Intrexon's competitors' or its collaborators'
operating results or changes in their respective growth rates;
(vii) Intrexon's cash position; (viii) market conditions in
Intrexon's industry; (ix) the volatility of Intrexon's stock price;
(x) Intrexon's ability, and the ability of its collaborators, to
protect Intrexon's intellectual property and other proprietary
rights and technologies; (xi) Intrexon's ability, and the ability
of its collaborators, to adapt to changes in laws or regulations
and policies; (xii) the outcomes of pending and future litigation;
(xiii) the rate and degree of market acceptance of any products
developed by Intrexon, its subsidiaries, collaborations or joint
ventures; (xiv) Intrexon's ability to retain and recruit key
personnel; (xv) Intrexon's expectations related to the use of
proceeds from its public offerings and other financing efforts;
(xvi) Intrexon's estimates regarding expenses, future revenue,
capital requirements and needs for additional financing; and (xvii)
the successful formation of a stand-alone company for our Methane
Bioconversion Platform. For a discussion of other risks and
uncertainties, and other important factors, any of which could
cause Intrexon's actual results to differ from those contained in
the forward-looking statements, see the section entitled "Risk
Factors" in Intrexon's Annual Report on Form 10-K for the fiscal
year ended December 31, 2018 and
subsequent reports filed with the Securities and Exchange
Commission. All information in this presentation is as of the date
of the release, and Intrexon undertakes no duty to update this
information unless required by law.
For more information regarding Intrexon Corporation,
contact:
Investor
Contact:
Steven
Harasym
Vice President,
Investor Relations
Tel: +1 (301)
556-9850
investors@dna.com
|
Corporate
Contact:
Marie Rossi,
PhD
Vice President,
Communications
Tel: +1 (301)
556-9850
publicrelations@dna.com
|
Intrexon
Corporation and Subsidiaries
|
Consolidated
Balance Sheets
|
(Unaudited)
|
|
(Amounts in
thousands)
|
|
June 30,
2019
|
|
December 31,
2018
|
Assets
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
58,162
|
|
$
|
102,768
|
Restricted
cash
|
|
|
—
|
|
|
6,987
|
Short-term
investments
|
|
|
67,641
|
|
|
119,688
|
Equity
securities
|
|
|
—
|
|
|
384
|
Receivables
|
|
|
|
|
|
|
Trade, net
|
|
|
24,496
|
|
|
21,195
|
Related parties,
net
|
|
|
7,095
|
|
|
4,129
|
Other, net
|
|
|
2,866
|
|
|
2,754
|
Inventory
|
|
|
18,192
|
|
|
21,447
|
Prepaid expenses and
other
|
|
|
4,712
|
|
|
6,131
|
Total current
assets
|
|
|
183,164
|
|
|
285,483
|
Equity securities,
noncurrent
|
|
|
21,503
|
|
|
1,798
|
Property, plant and
equipment, net
|
|
|
120,401
|
|
|
128,874
|
Intangible assets,
net
|
|
|
112,526
|
|
|
129,291
|
Goodwill
|
|
|
149,916
|
|
|
149,585
|
Investments in
affiliates
|
|
|
18,093
|
|
|
18,859
|
Right-of-use
assets
|
|
|
41,558
|
|
|
—
|
Other
assets
|
|
|
8,027
|
|
|
2,287
|
Total
assets
|
|
$
|
655,188
|
|
$
|
716,177
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
8,563
|
|
$
|
13,420
|
Accrued compensation
and benefits
|
|
|
9,034
|
|
|
10,687
|
Other accrued
liabilities
|
|
|
11,701
|
|
|
20,620
|
Deferred
revenue
|
|
|
16,593
|
|
|
15,554
|
Lines of
credit
|
|
|
387
|
|
|
466
|
Current portion of
long-term debt
|
|
|
468
|
|
|
559
|
Current portion of
lease liabilities
|
|
|
4,813
|
|
|
—
|
Related party
payables
|
|
|
74
|
|
|
256
|
Total current
liabilities
|
|
|
51,633
|
|
|
61,562
|
Long-term debt, net
of current portion
|
|
|
212,479
|
|
|
211,235
|
Deferred revenue, net
of current portion
|
|
|
66,542
|
|
|
54,210
|
Lease liabilities,
net of current portion
|
|
|
38,757
|
|
|
—
|
Deferred tax
liabilities, net
|
|
|
6,332
|
|
|
7,213
|
Other long-term
liabilities
|
|
|
222
|
|
|
3,235
|
Total
liabilities
|
|
|
375,965
|
|
|
337,455
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
Total
equity
|
|
|
|
|
|
|
Common
stock
|
|
|
—
|
|
|
—
|
Additional paid-in
capital
|
|
|
1,737,449
|
|
|
1,722,012
|
Accumulated
deficit
|
|
|
(1,430,020)
|
|
|
(1,330,545)
|
Accumulated other
comprehensive loss
|
|
|
(28,206)
|
|
|
(28,612)
|
Total Intrexon
shareholders' equity
|
|
|
279,223
|
|
|
362,855
|
Noncontrolling
interests
|
|
|
—
|
|
|
15,867
|
Total
equity
|
|
|
279,223
|
|
|
378,722
|
Total liabilities and
total equity
|
|
$
|
655,188
|
|
$
|
716,177
|
Intrexon
Corporation and Subsidiaries
|
Consolidated
Statements of Operations
|
(Unaudited)
|
|
(Amounts in
thousands,
except share and per
share data)
|
|
|
Three months
ended
|
|
|
Six months
ended
|
|
|
June
30,
|
|
|
June
30,
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
Collaboration and
licensing
revenues
|
|
$
|
9,097
|
|
$
|
17,450
|
|
$
|
15,067
|
|
$
|
37,298
|
Product
revenues
|
|
|
7,819
|
|
|
9,568
|
|
|
12,676
|
|
|
16,720
|
Service
revenues
|
|
|
18,400
|
|
|
17,718
|
|
|
29,783
|
|
|
29,965
|
Other
revenues
|
|
|
670
|
|
|
539
|
|
|
1,795
|
|
|
958
|
Total
revenues
|
|
|
35,986
|
|
|
45,275
|
|
|
59,321
|
|
|
84,941
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
products
|
|
|
9,176
|
|
|
10,639
|
|
|
17,466
|
|
|
19,169
|
Cost of
services
|
|
|
8,218
|
|
|
7,895
|
|
|
15,310
|
|
|
14,678
|
Research and
development
|
|
|
34,518
|
|
|
42,049
|
|
|
67,580
|
|
|
79,187
|
Selling, general and
administrative
|
|
|
21,483
|
|
|
34,427
|
|
|
55,077
|
|
|
74,164
|
Total operating
expenses
|
|
|
73,395
|
|
|
95,010
|
|
|
155,433
|
|
|
187,198
|
Operating
loss
|
|
|
(37,409)
|
|
|
(49,735)
|
|
|
(96,112)
|
|
|
(102,257)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Expense,
Net
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized and
realized
appreciation
(depreciation) in fair
value
of equity securities and
preferred stock,
net
|
|
|
5,632
|
|
|
(19,182)
|
|
|
5,702
|
|
|
(20,278)
|
Interest
expense
|
|
|
(4,358)
|
|
|
(142)
|
|
|
(8,669)
|
|
|
(241)
|
Interest and dividend
income
|
|
|
1,031
|
|
|
5,746
|
|
|
2,395
|
|
|
11,216
|
Other expense,
net
|
|
|
(2,605)
|
|
|
(93)
|
|
|
(2,099)
|
|
|
(881)
|
Total other expense,
net
|
|
|
(300)
|
|
|
(13,671)
|
|
|
(2,671)
|
|
|
(10,184)
|
Equity in net loss of
affiliates
|
|
|
(1,747)
|
|
|
(4,550)
|
|
|
(3,387)
|
|
|
(7,010)
|
Loss before
income
taxes
|
|
|
(39,456)
|
|
|
(67,956)
|
|
|
(102,170)
|
|
|
(119,451)
|
Income tax
benefit
|
|
|
525
|
|
|
1,127
|
|
|
1,103
|
|
|
5,213
|
Net loss
|
|
$
|
(38,931)
|
|
$
|
(66,829)
|
|
$
|
(101,067)
|
|
$
|
(114,238)
|
Net loss attributable
to the
noncontrolling interests
|
|
|
165
|
|
|
1,447
|
|
|
1,592
|
|
|
2,691
|
Net loss attributable
to
Intrexon
|
|
$
|
(38,766)
|
|
$
|
(65,382)
|
|
$
|
(99,475)
|
|
$
|
(111,547)
|
Net loss attributable
to
Intrexon per share, basic
and diluted
|
|
$
|
(0.25)
|
|
$
|
(0.51)
|
|
$
|
(0.65)
|
|
$
|
(0.87)
|
Weighted average
shares
outstanding, basic and
diluted
|
|
|
153,749,929
|
|
|
129,299,584
|
|
|
153,351,208
|
|
|
128,500,897
|
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SOURCE Intrexon Corporation