Filing identity and reporting period
Important discrepancy: The supplied filing is for Caladrius Biosciences, Inc. (Nasdaq: CLBS), not Lisata Therapeutics, Inc. It is a Form 10-Q for the quarter ended September 30, 2019—not 2018 Q3. The summary below reflects the filing text provided.
Caladrius is a clinical-stage biotechnology company developing cell therapies. Its unaudited financial statements cover the three and nine months ended September 30, 2019, with comparisons to 2018.
Financial results and liquidity
| Metric | Q3 2019 | Q3 2018 | Nine months 2019 | Nine months 2018 |
|---|---|---|---|---|
| Revenue | No revenue reported | No revenue reported | No revenue reported | No revenue reported |
| Research and development expense | $3.0 million | $1.7 million | $8.0 million | $6.1 million |
| General and administrative expense | $2.1 million | $2.1 million | $7.0 million | $7.1 million |
| Total operating expenses | $5.1 million | $3.8 million | $15.0 million | $13.2 million |
| Net loss | $4.9 million | $3.5 million | $14.4 million | $12.6 million |
| Loss per share, basic and diluted | $0.47 | $0.36 | $1.40 | $1.31 |
| Operating cash used | Not provided for quarter | Not provided for quarter | $14.7 million | $16.9 million |
At September 30, 2019, cash and cash equivalents were $12.7 million and marketable securities were $16.5 million, totaling approximately $29.2 million. Working capital was approximately $24.3 million. Total liabilities were $6.7 million, including $1.1 million of operating lease liabilities; the filing reports no interest expense for the 2019 period and no notes payable outstanding on the balance sheet.
Cash increased $2.4 million over the first nine months of 2019. Investing activities provided $16.1 million, principally from net sales of marketable securities; financing activities provided $0.9 million, including $1.0 million gross proceeds from the Lincoln Park stock purchase. No operating margin is meaningful in the absence of reported revenue.
Material changes versus prior comparable periods
- Q3 operating expenses rose 35% year over year, driven by a 77% increase in R&D. Nine-month operating expenses increased 14%, as R&D rose 32% while G&A declined 2%.
- Net loss widened to $4.9 million for Q3 and $14.4 million for the first nine months, versus $3.5 million and $12.6 million, respectively, in 2018.
- Operating cash use improved to $14.7 million from $16.9 million for the nine-month period, while the prior-period cash flow included $5.6 million provided by working-capital changes.
- Cash and marketable securities declined from $43.1 million at December 31, 2018 to $29.2 million at September 30, 2019. The company reported a $62,000 accumulated-deficit adjustment upon adopting an accounting standard and recognized operating lease balances under the new lease accounting standard.
Outlook, development programs, and risks
- Management stated that existing cash was expected to fund operating expenses for at least 12 months after issuance of the financial statements. This outlook assumes a Phase 3 CLBS14 trial will not begin unless additional capital is secured.
- CLBS12: Phase 2 enrollment in Japan was ongoing. Management expected enrollment completion in the first half of 2020, top-line data in late 2020 or early 2021, and an earliest possible Japanese approval in 2021. These are forward-looking targets, not assurances.
- CLBS16: Phase 2 enrollment was complete. The company described early observations as encouraging but noted that conclusions depended on full follow-up data. It planned to present results for the first 17 of 20 patients in November 2019.
- CLBS14: FDA discussions had finalized the design of a confirmatory Phase 3 trial, but patient enrollment was deferred until sufficient capital was obtained to fund completion.
- CLBS03: The Phase 2a T-Rex study was well tolerated, but its primary endpoint of preserving C-peptide was not achieved. Further development decisions were pending analysis, including two-year follow-up data expected in early 2020.
- Management cited ongoing operating losses and the risk that additional financing may not be available on acceptable terms or at all. Possible funding sources include equity or debt financing, partnerships, collaborations, grants, and asset sales; equity issuance may dilute shareholders.
- The company had access to a Lincoln Park purchase agreement of up to $26 million, subject to conditions, but had used it only for the initial $1.0 million purchase by September 30, 2019. No material changes to previously disclosed risk factors or legal proceedings were reported. Management said disclosure controls were effective at a reasonable-assurance level.
Most important facts for investors to verify
- Confirm the intended issuer and period: the supplied document identifies Caladrius Biosciences and Q3 2019, not Lisata Therapeutics and Q3 2018.
- Assess cash runway against the $14.7 million nine-month operating cash outflow and the conditional CLBS14 Phase 3 spending plan.
- Track CLBS12 and CLBS16 enrollment, complete datasets, regulatory milestones, and any changes to the stated timelines.
- Review the CLBS03 follow-up analysis and any resulting decision to continue or discontinue development.
- Monitor actual use of the Lincoln Park facility and other financing sources, including potential dilution and financing availability.