Serina Therapeutics, Inc. — filing identity note
The supplied filing is AgeX Therapeutics, Inc.’s Form 10-Q, not a filing for Serina Therapeutics, Inc. The summary below reflects the filer and financial information in the document.
Business context and reporting period
AgeX reported the quarter and nine months ended September 30, 2019. It is a biotechnology company pursuing preclinical programs in regenerative biology and age-related disease, alongside revenue-generating biomedical databases and tools through majority-owned LifeMap Sciences. Its programs include brown-fat research, PureStem-derived vascular cells, and induced tissue regeneration. Financial amounts below are in thousands of dollars unless noted.
Financial performance and position
- Third-quarter revenue: $411, up 8.2% from $380. Subscription and advertising revenue was $342, down 8.3%; grant revenue was $41; other revenue was $28.
- Third-quarter results: Gross profit was $362 versus $384. Operating expenses rose 40.8% to $3,641, including R&D of $1,447 and G&A of $2,194. Operating loss was $3,279; net loss attributable to AgeX was $3,221, or $0.09 per share, versus $2,151, or $0.06 per share, a year earlier.
- Nine-month results: Revenue was $1,179, up 8.9%; gross profit was $1,014, up 12.8%. Operating expenses totaled $10,857, including R&D of $4,435 and G&A of $6,422. Net loss attributable to AgeX was $9,443, or $0.25 per share, versus $4,316, or $0.12 per share, in 2018.
- Cash flow: Operating activities used $7,749 in the first nine months, compared with $5,949 in 2018. Investing activities used $66; financing activities provided $4,978, including $4,500 from warrant exercises and a $500 Juvenescence loan draw. Cash, cash equivalents and restricted cash ended at $3,868; the balance sheet reports cash and cash equivalents of $3,768.
- Liquidity, debt and equity: Current assets were $4,690 and current liabilities $2,907. Total liabilities were $3,240, including a $191 net Juvenescence loan balance and $529 of operating lease liabilities. Stockholders’ equity was $4,943; accumulated deficit was $83,497. Shares outstanding were 37.649 million at September 30.
Material changes versus the prior comparable period
- Third-quarter G&A increased $940 (75%) year over year, primarily from professional fees, stock compensation and insurance. For the nine months, G&A increased $2,743 (74.6%), with the same categories among the main drivers.
- R&D increased 8.6% in the quarter and 3.0% for the nine months. The 2018 nine-month comparison included $800 of acquired in-process R&D, which did not recur in 2019.
- Nine-month revenue growth included $103 of NIH grant revenue, absent in 2018. Subscription and advertising revenue rose 5.0% for the nine months but declined in the third quarter.
- The 2018 nine-month results included a $3,215 gain on sale of the Ascendance investment; 2019 included a further $354 escrow distribution. The prior-period gain materially affects comparisons of net loss.
- AgeX terminated its shared facilities and services agreement with former parent Lineage on September 30, 2019 and moved to a new Alameda office and research facility during the year.
Outlook, risks and unusual items
- Going concern: Management stated that September 30 cash of $3.8 million and the Juvenescence facility would not cover anticipated operating and other funding needs for the next 12 months from the filing date. The filing identifies substantial doubt about the company’s ability to continue as a going concern and says additional funding is needed.
- Cost controls and R&D: AgeX reduced projected spending; some measures defer work on product candidates and are expected to delay research progress. Failure to raise capital could force further delay, reduction or elimination of programs. No specific revenue, earnings or clinical-development guidance is provided.
- Juvenescence financing: The 18-month facility is $2.0 million, with $500 drawn and up to $1.5 million more potentially available subject to terms, including advance notice. The loan carries a 10% default rate if not repaid when due, and may be convertible in a qualifying offering. Juvenescence is a major shareholder, holding approximately 44% at quarter-end.
- Other risks and contingencies: The filing highlights financing and dilution risk, biotechnology development uncertainty, and anti-bribery compliance risks, including in China. AgeX reported no material litigation and no material changes to previously disclosed risks other than those described in the filing.
- Lease and accounting: The new facility sublease expires December 31, 2020; future minimum lease payments were $548 before imputed interest. Adoption of lease accounting resulted in recognition of right-of-use assets and liabilities. The filing reports no off-balance-sheet arrangements.
Important facts for investors to verify
- Confirm the issuer: this source is AgeX Therapeutics, Inc. (NYSE American: AGE), not Serina Therapeutics, Inc.
- Review the going-concern disclosure, cash burn, and the amount and availability of remaining Juvenescence financing.
- Assess whether spending reductions and any new financing can sustain operations without materially delaying or curtailing research programs.
- Reconcile the cash-flow statement’s $3.868 million ending cash, cash equivalents and restricted cash with the balance sheet’s $3.768 million cash and cash equivalents.
- Consider the comparability of 2018 results, including the Ascendance gain and the accounting and operating transition following Lineage’s loss of control.