kool20180514_8k.htm

 



 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): May 14, 2018

 

CESCA THERAPEUTICS INC.

(Exact Name of Registrant as Specified in Charter)

 

 

 

 

 

   

Delaware

 

333-82900

 

94-3018487

(State or Other Jurisdiction

 

(Commission

 

(IRS Employer

of Incorporation)

 

File Number)

 

Identification No.)

 

 

 

   

2711 Citrus Road, Rancho Cordova, California

 

95742

(Address of Principal Executive Offices)

 

(Zip Code)

 

Registrant’s telephone number, including area code: (949) 753-0624

 

N/A
(Former Name or Former Address, if Changed Since Last Report)

 


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

      ☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

      ☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

      ☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

      ☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

 

          Emerging growth company      ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.    ☐

 



 

 

 

 

Item 2.02.

Results of Operations and Financial Condition.

 

On May 14, 2018, Cesca Therapeutics Inc. issued a press release announcing its results of operations and financial condition for the first quarter of fiscal year 2018. The full text of the press release is set forth in Exhibit 99.1 attached to this Current Report on Form 8-K.

 

The information contained in this Item 2.02 and in Exhibit 99.1 attached to this Current Report on Form 8-K is being furnished to the Securities and Exchange Commission and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, or incorporated by reference in any filing under the Exchange Act or the Securities Act of 1933, except as shall be expressly set forth in such a filing.

 

 

Item 9.01.

Financial Statements and Exhibits.

 

 

Exhibit No.

Description

 

  99.1

Press release dated May 14, 2018, titled “Cesca Therapeutics Announces First Quarter 2018 Financial Results and Provides Corporate Update”.

 

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

   

CESCA THERAPEUTICS INC.

    (Registrant)
   

 

Dated: May 14, 2018

 

/s/ Vivian Liu                                   

   

Vivian Liu, Chief Operating Officer

 

ex_114367.htm

Exhibit 99.1

 

 

 

CESCA THERAPEUTICS ANNOUNCES FIRST QUARTER 2018 FINANCIAL RESULTS AND PROVIDES CORPORATE UPDATE

 

Conference Call to be Held at 4:30 p.m. ET (1:30 p.m. PT)

 

RANCHO CORDOVA, CA, May 14, 2018 – Cesca Therapeutics Inc. (NASDAQ: KOOL), a market leader in automated cell processing and point-of-care, autologous cell-based therapies, today announced financial and operating results for the first quarter ended March 31, 2018, and provided a corporate update.

 

First Quarter and Recent Highlights

 

 

Announced first two evaluation agreements with leading academic research institutions for the Company’s X-Series™ products for automated, closed system cellular processing.

 

 

Presented two posters pertaining to the Company’s X-BACS™ and X-Wash™ cellular processing systems at the International Society for Cellular Therapy (ISCT) 2018 Annual Meeting in Montreal, Québec.

 

 

Announced the release of the X-Mini™ cell selection kit for the CAR-T research market.

 

 

Filed a new patent application with the US Patent and Trademark Office (USPTO) for an innovation to Cesca’s CAR-TXpress™ technology, which will allow for the simultaneous purification and activation of T-cells, thereby simplifying the CAR-TXpress workflow and tangibly accelerating the CAR-T cell manufacturing process.

 

 

Initiated entry into the contract development and manufacturing (CDMO) space with signing of an exclusive license agreement with China-based IncoCell Tianjin Ltd. for CAR-T related CDMO services covering the Asia Pacific region.

 

 

Launched the second-generation AXP® II system for advanced cord blood and peripheral blood processing.

 

“Since our acquisition of SynGen in July of last year, we have made substantial progress advancing our novel CAR-TXpress solution, and related X-Series kits, toward commercialization,” said Dr. Chris Xu, chief executive officer of Cesca. “Notably, we introduced our first X-Series kit, the X-Mini, which targets the large and growing CAR-T research market, and subsequently entered into our first evaluation agreements with two leading academic research institutions focused on cell therapies. In addition, we continued to execute on our strategy to become a diversified CAR-T service provider with the signing of the CDMO agreement with IncoCell, the first of several CDMO collaborations that we are pursuing in key markets, including the U.S. Finally, we bolstered our intellectual property estate with the filing of an additional patent that further differentiates our proprietary CAR-TXpress workflow. We remain very optimistic about the numerous opportunities within the rapidly-emerging immuno-oncology field and are positioning the Company to respond to unmet market needs. Our goal is to maintain our current momentum, and we believe we have set the stage for 2018 to be a truly transformational year for our company.”

 

 

 

 

Financial Results for the First Quarter Ended March 31, 2018

 

Net revenue. Net revenues for the three months ended March 31, 2018 were $1.9 million compared to $3.3 million for the comparable period in 2017. The decline was driven by decreased AXP disposable sales in China.

 

Gross profit. Gross profit for the three months ended March 31, 2018 was $352,000, or 19.0% of net revenue, compared to $1.4 million, or 42.0% of net revenue for the comparable period in 2017. The decrease in gross profit margin percentage was primarily due to decreased overhead absorption and higher costs as a result of the merger with SynGen, which was completed in July 2017.

 

Sales and marketing expenses. Sales and marketing expenses for the three months ended March 31, 2018 were $325,000 compared to $335,000 for the comparable period in 2017.

 

Research and development expenses. Research and development (R&D) expenses for the three months ended March 31, 2018 were $1.0 million, compared to $567,000 for the comparable period in 2017. The increase is primarily due to additional headcount and expenses relating to the ongoing development of the Company’s X-Series products and CAR-TXpress platform.

 

General and administrative expenses. General and administrative expenses for the three months ended March 31, 2018 were $2.2 million compared to $2.6 million for the comparable period in 2017. The decrease was driven by a reduction in legal expenses due to the settlement of the SynGen litigation.

 

Net loss attributable to common stockholders. For the three months ended March 31, 2018, the Company reported a net loss attributable to common stockholders of $3.0 million, or ($0.27) per share, based on approximately 11.1 million weighted average basic and diluted common shares outstanding. This compares to a net loss of $2.1 million, or ($0.21) per share, based on approximately 9.9 million weighted average basic and diluted common shares outstanding for the three months ended March 31, 2017.

 

 

 

 

Conference Call and Webcast Information

Cesca will host a conference call and audio webcast today at 4:30 p.m. EDT (1:30 p.m. PDT). Participants may access the call by dialing 1-800-860-2442 within the U.S. or 1-412-858-4600 outside the U.S. and referencing “Cesca.” To access a live webcast of the call, please visit:

http://services.choruscall.com/links/kool180514.html. A replay of the call can be accessed approximately one hour after completion of the call and will be available until June 14, 2018. To listen to the replay, dial 1-877-344-7529 within the U.S. or 1-412-317-0088 outside the U.S. and reference access code 10119918.

 

About Cesca Therapeutics Inc.

Cesca Therapeutics develops, commercializes and markets a range of automated technologies for CAR-T and other cell-based therapies. Its device division, ThermoGenesis, provides a full suite of solutions for automated clinical biobanking, point-of-care applications, and automation for immuno-oncology. The Company is developing its automated, functionally-closed CAR-TXpress™ platform to streamline the manufacturing process for the emerging CAR-T immunotherapy market.

 

Forward-Looking Statement

The statements contained herein may include statements of future expectations and other forward-looking statements that are based on management’s current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. A more complete description of risks that could cause actual events to differ from the outcomes predicted by Cesca Therapeutics’ forward-looking statements is set forth under the caption "Risk Factors" in Cesca Therapeutics’ annual report on Form 10-K and other reports it files with the Securities and Exchange Commission from time to time, and you should consider each of those factors when evaluating the forward-looking statements.

 

Company Contact:

Cesca Therapeutics Inc.

Wendy Samford

916-858-5191

ir@cescatherapeutics.com

 

Investor Contact:

Rx Communications

Paula Schwartz

917-322-2216

pschwartz@rxir.com

 

 

 

 

Financials

 

Cesca Therapeutics Inc.

Condensed Consolidated Balance Sheets

 

   

March 31,

2018

   

December 31,

2017

 
   

(Unaudited)

         

ASSETS

               

Current assets:

               

Cash and cash equivalents

  $ 2,872,000     $ 3,513,000  

Accounts receivable, net

    1,649,000       2,549,000  

Inventories

    5,221,000       4,798,000  

Prepaid expenses and other current assets

    557,000       594,000  
                 

Total current assets

    10,299,000       11,454,000  
                 

Restricted cash

    1,000,000       1,000,000  

Equipment, net

    3,265,000       2,996,000  

Goodwill

    13,976,000       13,976,000  

Intangible assets, net

    21,590,000       21,629,000  

Other assets

    51,000       56,000  
                 

Total assets

  $ 50,181,000     $ 51,111,000  
                 

LIABILITIES AND STOCKHOLDERS’ EQUITY

               

Current liabilities:

               

Accounts payable

  $ 2,415,000     $ 2,079,000  

Other current liabilities

    3,980,000       3,385,000  

Total current liabilities

    6,395,000       5,464,000  
                 

Long-term liabilities

    12,666,000       12,435,000  

Total liabilities

    19,061,000       17,899,000  
                 

Cesca Therapeutics Inc. stockholders' equity

    32,017,000       33,699,000  
                 

Noncontrolling interests

    (897,000 )     (487,000 )
                 

Total liabilities and stockholders’ equity

  $ 50,181,000     $ 51,111,000  

 

 

 

 

Cesca Therapeutics Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

 

   

Three Months Ended
March 31,

 
   

2018

   

2017

 

Net revenues

  $ 1,867,000     $ 3,252,000  
                 

Cost of revenues

    1,515,000       1,875,000  
                 

Gross profit

    352,000       1,377,000  
                 

Expenses:

               

Sales and marketing

    325,000       335,000  
                 

Research and development

    1,041,000       567,000  
                 

General and administration

    2,242,000       2,591,000  
                 

Total operating expenses

    3,608,000       3,493,000  
                 

Loss from operations

    (3,256,000 )     (2,116,000 )
                 

Fair value change of derivative instruments

    259,000       69,000  

Interest expense

    (361,000 )     (19,000 )

Other (expenses)

    (12,000 )     (31,000 )
                 

Net loss

    (3,370,000 )     (2,097,000 )
                 

Loss attributable to noncontrolling interests

    (410,000 )     --  
                 

Net loss attributable to common stockholders

  $ (2,960,000 )   $ (2,097,000 )

 

 

 

 

Cesca Therapeutics Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

 

   

Three Months Ended

March 31,

 
   

2018

   

2017

 

Cash flows from operating activities:

               

Net cash used in operating activities

    (2,054,000 )     (2,543,000 )
                 

Cash flows from investing activities:

               

Capital expenditures

    (290,000 )     (33,000 )
      (290,000 )     (33,000 )

Cash flows from financing activities:

               

Payments on capital lease obligations

    (9,000 )     (23,000 )

Proceeds from issuance of common stock, net

    1,213,000       --  

Proceeds from long-term debt-related party

    500,000       1,500,000  

Payment of financing cost

    --       (13,000 )
                 

Net cash provided by financing activities

    1,704,000       1,464,000  
                 

Effects of foreign currency rate changes on cash and cash equivalents

    (1,000 )     4,000  

Net decrease in cash, cash equivalents and restricted cash

    (641,000 )     (1,108,000 )
                 

Cash and cash equivalents at beginning of period

    4,513,000       4,899,000  

Cash and cash equivalents at end of period

  $ 3,872,000     $ 3,791,000