Orgenesis completes sale of Masthercell subsidiary; receives approximately USD 127 million in net proceeds
- Sale reflects culmination of successful CDMO strategy initiated in 2015 and 59 percent 5-year CAGR of Masthercell under Orgenesis’ leadership
- Reports rapid progress in roll-out of point-of-care (POCare) platform to capitalize on industry demand for patient cell processing and treatment within the patient care setting
- POCare platform poised for accelerated growth through industry partnerships underway with leading healthcare institutions around the world
Germantown, MD, US, February 11, 2020 – Orgenesis Inc. (NASDAQ: ORGS), a provider of point-of-care cell and gene therapy development, processing and treatment solutions (“POCare”), today announces the completion of the sale of its Masthercell Global, Inc. subsidiary, a contract development manufacturing organization (CDMO), to Catalent Pharma Solutions. Upon closing, Orgenesis received net proceeds of approximately USD 127 million from the transaction. Orgenesis also provides an update and unveiled plans for its rapidly evolving POCare solutions.
Vered Caplan, CEO of Orgenesis, stated, “In 2015, we acquired Masthercell, having identified an industry trend and unmet demand for first-in-class cell and gene therapy CDMO services. Since acquiring Masthercell, the CDMO segment revenue has increased from a run-rate of just USD 3 million to a run-rate of approximately USD 30 million at the end of 2019, reflecting a compound annual growth rate of 59 precent under our leadership, and a sale price of more than 5 times our initial purchase price of approximately USD 25 million. Meanwhile, the market opportunity and value proposition for Orgenesis’ POCare solutions has continued to increase, as these solutions uniquely enable localized cell and gene therapy development, processing and supply within the patient care setting. As such, we decided it was the right time to sell Masthercell to maximize value for our shareholders, and focus our efforts around our POCare solutions, which we believe represent a major paradigm shift and will play a major role in the future of the cell and gene therapy market. As previously announced, we have already established joint ventures with leading universities and healthcare institutions and are in advanced discussions with a number of additional major institutions around the world.”
“Our POCare platform is designed to provide unique cell and gene therapy capabilities in a cost effective, high quality and scalable manner, using closed systems and other advanced cell processing technologies at the point of care. In addition, our platform enables us to advance our therapeutic pipeline, and to identify additional in-licensing and acquisition opportunities from biopharmaceutical companies, research organizations and healthcare institutes, while providing continuous development support for these partners, including regulatory services and clinical studies. In turn, we can aid in the delivery of these therapeutic developments through our international point of care network, as a one-stop-solution for the onsite collection, processing and administration of cell and gene therapies for patients within the hospital setting.”
“By switching from a high-cost centralized manufacturing model to a localized point-of-care model, Orgenesis believes it can dramatically reduce costs and accelerate the path to bringing life-saving therapies to patients. These therapies span a wide range of treatments, such as cell-based immunotherapies, therapeutics for metabolic diseases, neurodegenerative diseases, tissue regeneration and more. As a result of the sale of Masthercell and the infusion of capital that this transaction generated, as well as the tremendous progress of our evolving POCare platform, I truly believe Orgenesis is now positioned at the forefront of this rapidly emerging industry. We remain committed to developing Orgenesis into a formidable world-wide organization, continuing our dedication to patients and generating value for our shareholders.”
Orgenesis is a biopharmaceutical company specializing in the development, manufacturing and processing of technologies and services in the cell and gene therapy industry. The Company operates a point-of-care (“POCare”) cell therapy platform whose aim is to further the development of Advanced Therapy Medicinal Products (“ATMPs”) through collaborations and in-licensing with other pre-clinical and clinical-stage biopharmaceutical companies and research and healthcare institutes to bring such ATMPs to patients. The Company out-licenses these ATMPs through regional partners to whom it also provides regulatory, pre-clinical and training services to support their activity in order to reach patients in a point-of-care hospital setting. Additional information is available at: www.orgenesis.com.
Notice Regarding Forward-Looking Statements
This press release contains forward-looking statements which are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended. These forward-looking statements involve substantial uncertainties and risks and are based upon our current expectations, estimates and projections and reflect our beliefs and assumptions based upon information available to us at the date of this release. We caution readers that forward-looking statements are predictions based on our current expectations about future events. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict. Our actual results, performance or achievements could differ materially from those expressed or implied by the forward-looking statements as a result of a number of factors, including, but not limited to, our reliance on, and our ability to grow, our point-of-care cell therapy platform, our ability to effectively use the net proceeds from the sale of Masthercell, our ability to achieve and maintain overall profitability, the sufficiency of working capital to realize our business plans, the development of our POCare strategy, our trans-differentiation technology as therapeutic treatment for diabetes which could, if successful, be a cure for Type 1 Diabetes, the technology behind our in-licensed ATMPs not functioning as expected, our ability to retain key employees, our competitors developing better or cheaper alternatives to our products and the risks and uncertainties discussed under the heading "RISK FACTORS" in Item 1A of our Annual Report on Form 10-K for the fiscal year ended November 30, 2018, and in our other filings with the Securities and Exchange Commission. We undertake no obligation to revise or update any forward-looking statement for any reason.