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ATHERSYS, INC / NEW (ATHX)·Q1 2023 Earnings Summary

Executive Summary

  • No revenue and materially lower operating expenses as restructuring took hold; Q1 2023 revenue was $0 vs $2.9M in Q1 2022, while R&D fell to $4.5M (from $20.9M) and G&A to $2.8M (from $4.1M) .
  • Net loss narrowed both sequentially and year over year to $7.8M ($0.43 per share) vs $13.0M ($0.83) in Q4 2022 and $22.2M ($2.27) in Q1 2022, driven by cost actions; however, cash fell to $3.1M from $9.0M at year-end, highlighting financing urgency .
  • MASTERS-2 stroke trial protocol amended post FDA Type B meeting: primary endpoint shifted to mRS Day 365, caps on reperfusion therapy removed, and interim analysis option added—management emphasized greater confidence in path forward .
  • Corporate actions and catalysts: raised $3.7M in a registered direct offering; BARDA RFP participation for ARDS; MATRICS trauma DSMB review completed; SIFU storage patent granted; Nasdaq compliance and contract manufacturer payment/access risks remain catalysts for stock volatility .

What Went Well and What Went Wrong

What Went Well

  • Maintained operating expenses below $2.5M per month and advanced MASTERS-2 protocol to better capture longer-term benefits: “We entered 2023 with greater clarity and confidence... reduced our operating expenses below $2.5 million per month” .
  • Business development and funding progress: raised $3.7M, engaged multiple potential partners across programs including animal health and SIFU .
  • Clinical and IP progress: DSMB review completed for MATRICS cohorts 1 & 2; awarded U.S. patent for SIFU cryogenic storage system .

What Went Wrong

  • Revenue went to zero as Healios services ended; Q1 2023 revenue $0 vs $2.9M YoY, underscoring lack of near-term commercial income .
  • Liquidity tightened sharply; cash fell to $3.1M from $9.0M at year-end, necessitating additional financing and elevating going-concern risk highlighted in forward-looking statements .
  • Ongoing risk factors include payment issues with the primary contract manufacturer impacting access to clinical product and Nasdaq listing compliance risk, both flagged by management .

Financial Results

Sequential trend (oldest → newest)

MetricQ3 2022Q4 2022Q1 2023
Revenue ($USD Millions)$0.065 $0.032 $0.000
R&D Expense ($USD Millions)$12.424 $10.869 $4.467
G&A Expense ($USD Millions)$3.737 $2.885 $2.815
Net Loss ($USD Millions)$13.669 $13.001 $7.811
Diluted EPS ($)$(1.15) $(0.83) $(0.43)
Cash & Equivalents at Period End ($USD Millions)$13.782 $9.038 $3.121

Year over year comparison

MetricQ1 2022Q1 2023
Revenue ($USD Millions)$2.912 $0.000
R&D Expense ($USD Millions)$20.944 $4.467
G&A Expense ($USD Millions)$4.099 $2.815
Net Loss ($USD Millions)$22.216 $7.811
Diluted EPS ($)$(2.27) $(0.43)
Weighted Avg. Shares (Millions)9.768 18.292

Segment breakdown

SegmentQ1 2023 Revenue ($USD Millions)
Not applicable (pre-revenue biotech)$0.000

KPIs and operating metrics

KPIQ2 2022Q3 2022Q4 2022Q1 2023
MASTERS-2 enrollment progressEnrollment rate doubled vs prior years; more subjects than any prior quarter Doubled avg. monthly enrollment; expanded sites globally Exceeded 50% enrollment; additional US/EU site activations planned in H1’23 Continued enrollment progress; protocol amended, interim analysis option added
Monthly OpEx run-rateRestructuring underway Restructuring largely complete Reduced to < $3M/month; headcount cut ~70% Maintained < $2.5M/month

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
R&D Expense TrajectoryFY 2023 vs 2022Expect 2023 annual R&D expenses to be lower vs 2022 Reiterated lower trajectory supported by restructuring (Q1 run-rate reflected) Maintained
G&A Expense TrajectoryFY 2023Not explicitly guidedCompany expects further decreases in G&A expenses Lowered
MASTERS-2 Primary EndpointTrial endpoint timingmRS shift analysis at Day 90 (prior design) mRS shift analysis at Day 365 (primary); Day 90 retained as key secondary Changed
MASTERS-2 Reperfusion Therapy CapsEligibilityCaps on concomitant therapy existed Caps removed to reflect eligible population Changed
MASTERS-2 Interim AnalysisDesignNo interim powering analysis option Option added to confirm sample size adequacy Added

Earnings Call Themes & Trends

Note: No Q1 2023 earnings call transcript was found; the company indicated a late-April business update call, but transcript access was not available in our document set .

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q1 2023)Trend
R&D execution & trial enrollmentQ2: Enrollment rate doubled; more subjects than any prior quarter; trial sites expanded . Q3: Continued acceleration; added global sites .Continued enrollment; protocol amended to better capture long-term outcomes .Improving operational focus and design clarity
Regulatory interactionsQ2: Analyzed TREASURE for read-through . Q3: Ongoing KOL engagement .Successful FDA Type B meeting; protocol amendments adopted .Positive regulatory dialogue
Manufacturing & supplyQ2: Suspended high-cost manufacturing/process dev; sublet facility; scaled bioreactors in MATRICS . Q3: Manufacturing rights to Healios for ARDS/stroke .Risks remain regarding contract manufacturer payments/access per forward-looking statements .Operational risk persists
BARDA/ARDS initiativesQ2: MACOVIA suspended pending financing; BARDA/AFRRI preclinical data . Q3: BARDA and ARDS activities continued .Participated in BARDA RFP for ARDS/COVID comorbidities .Potential non-dilutive funding option
Financing & liquidityQ2: Restructuring; exploring financing options . Q3: Raised $12.0M and $5.5M offerings; reverse split .Raised $3.7M; cash down to $3.1M, highlighting runway constraints .Ongoing financing need
Nasdaq complianceQ2: Minimum bid price risk noted . Q3: Market value compliance risk noted .Continued listing compliance risk reiterated .Unresolved

Management Commentary

  • “We entered 2023 with greater clarity and confidence on our path forward with MultiStem... reduced our operating expenses below $2.5 million per month... achieving a successful Type B meeting with the FDA... will now more appropriately represent the regenerative benefits of MultiStem over a longer period... We’ve also made meaningful progress with trial enrollment and advanced conversations with multiple parties...” — Dan Camardo, CEO .
  • Q4 context: “We have worked diligently to reduce the company’s historically large cash burn... With a leaner organization... we entered 2023 in a far stronger position... We remain focused on advancing MASTERS-2... engage with potential partners to advance MultiStem...” — Dan Camardo, CEO .

Q&A Highlights

  • The company did not provide a Q1 2023 earnings call transcript; Q4 indicated a late-April business update call, but no transcript was available in this corpus for Q&A review .

Estimates Context

  • Wall Street consensus via S&P Global: Q1 2023 EPS and revenue estimates were unavailable due to missing CIQ mapping for ATHX in SPGI (attempted retrieval returned no data). As a result, we cannot benchmark vs consensus for this quarter [GetEstimates attempt; unavailability noted].
MetricQ1 2023 ConsensusNotes
Revenue ($USD Millions)Unavailable via S&P GlobalNo CIQ mapping for ATHX; consensus not retrieved
EPS ($)Unavailable via S&P GlobalNo CIQ mapping for ATHX; consensus not retrieved

Key Takeaways for Investors

  • Cost structure reset appears durable: R&D down to $4.5M and G&A to $2.8M in Q1; monthly OpEx maintained below $2.5M, significantly narrowing net loss to $7.8M and improving cash burn trajectory .
  • Liquidity is the fulcrum: cash at $3.1M post quarter-end with recent $3.7M raise; additional capital or non-dilutive funding (e.g., BARDA) is critical to sustain trials and operations; monitor near-term financing events and runway disclosures .
  • MASTERS-2 redesign is a strategic positive: shifting primary endpoint to Day 365 aligns with observed longer-term functional outcomes and may enhance trial success probability; interim analysis option provides risk management on powering .
  • Execution risks remain: access to clinical product hinges on resolving contract manufacturer payment issues; Nasdaq compliance risk persists as an overhang—both are potential volatility catalysts .
  • Revenue visibility is minimal near-term: Healios-related service revenues are largely complete, and Q1 revenue was zero—investment case is driven by clinical/regulatory milestones rather than P&L contributions .
  • Watch ARDS/trauma optionality: BARDA RFP engagement and MATRICS DSMB progress broaden potential indications and funding sources, offering diversification beyond stroke .
  • Without consensus benchmarks, focus on operational milestones and financing signals for trading decisions; headline risk tied to regulatory updates, capital raises, and listing compliance should guide short-term positioning .