Lineage Cell Therapeutics

Lineage Facilities

Our corporate headquarters are in an office park in Carlsbad, California. We also lease industrial space adjacent to our corporate headquarters.

CCN Facilities

Under various leases, CCN leases office and laboratory space in the Bio Park on the campus of the Hadassah University Hospital in Jerusalem, Israel.

• We may acquire or acquire rights to new technologies, product candidates and other assets or businesses, which could fail to result in a commercial product or net sales, divert our management’s attention, result in additional dilution to our shareholders or otherwise disrupt our business and adversely affect our results of operations.
• All of our manufacturing operations currently are conducted at our facility in Jerusalem, Israel. Accordingly, political and economic conditions in Israel and war, cyberattacks, terrorist attacks or other armed conflicts involving Israel and the broader region could directly affect our business. Any event or condition that significantly disrupts our ordinary course of operations at our Jerusalem facility could harm our business and materially and adversely affect our financial condition and operating results.
• CCN has received Israeli government grants for certain of its research and development activities. The terms of these grants may require us to seek approvals and to satisfy specified conditions to manufacture products and transfer or license grant-supported technologies outside of Israel. In the context of such approvals, we will be required to pay penalties in addition to the repayment of the grants.
• Clinical development of OPC1 has been supported in part by grant funding from CIRM. We may not be able to timely obtain additional CIRM funding, which could negatively impact our ongoing clinical trial and our ability to advance clinical development of OPC1, as well as our operating results and financial condition. In addition, our profits from the sale of products resulting from CIRM-funded development, if any, will be reduced by amounts that we are required to pay CIRM.
• Our international business exposes us to business, regulatory, political, operational, financial and economic risks associated with doing business outside of the United States.
• The administration of our cell therapy product candidates requires surgical transplantation, which exposes us to additional regulatory, clinical, operational and commercial risks that could materially adversely affect our business, results of operations and prospects.
• Our business could be adversely affected if we lose the services of the key personnel upon whom we depend or if we fail to attract and retain senior management and key scientific personnel.
• Changes in tax laws or regulations that are applied adversely to us or our customers may have a material adverse effect on our business, cash flow, financial condition or results of operations.
• Our ability to use our net operating losses and other tax attributes to offset future taxable income or taxes may be limited, which may effectively increase our future income tax obligations.
• Taxing authorities could reallocate our taxable income among our subsidiaries, which could increase our overall tax liability.
• Because a portion of our expenses are incurred in currencies other than the U.S. Dollar, our results of operations may be harmed by currency fluctuations.
• Disruptions at the FDA, SEC and other government agencies, including due to a lack of funding, government shutdowns, policy changes, leadership and organizational changes, or significant personnel turnover, could delay or disrupt clinical and preclinical development and potential marketing approval of our product candidates and hinder our ability to raise additional capital.
• Risks Related to Government Regulation
• If we or our strategic collaborators are unable to obtain FDA or comparable foreign regulatory authority approvals for our product candidates on a timely basis, or at all, our product candidates may not be marketed or sold and our business will be substantially harmed.
• Government-imposed bans or restrictions and religious, moral, and ethical concerns about the use of hES cells could prevent us from developing and successfully marketing stem cell products.
• Our reliance on pluripotent cell lines that may be exempt from certain donor eligibility requirements could create regulatory, labeling, and commercialization constraints, and could require us to undertake additional steps that delay, limit, or prevent commercialization of one or more product candidates.
• Some of our product candidates, may be considered combination products by the FDA and other regulatory authorities, which could increase the complexity, cost and timeline for their development and regulatory approval.
• We expect that the commercial opportunity for some of our products may depend on our ability, or that of a commercial collaborator, to obtain and maintain reimbursement and continued coverage from various payors, including government agencies and insurance companies.
• Certain of the clinical sites for the GAlette study are outside of the United States and we or our collaborators may in the future conduct certain of our clinical trials for one or more of our product candidates outside of the United States. However, the FDA and other foreign equivalents may not accept data from such trials, in which case our development plans will be delayed, which could materially harm our business.
• Legislation and legislative, executive and regulatory proposals intended to contain health care costs may adversely affect our business.
• The ACA and future changes to that law may adversely affect our business.
• If we fail to comply with the extensive legal and regulatory requirements affecting the healthcare industry, we could face increased costs, penalties and loss of business.
• Even if we receive approval to market a product candidate, we may be subject to extensive post-approval regulatory obligations that may have a significant adverse effect on our business, results of operations, financial condition and reputation.
• The FDA has granted orphan drug designation to OPC1 for the treatment of acute SCIs. However, there is no guarantee we will be able to maintain this designation, receive this designation for any other product candidate, or obtain the benefits associated with such designation, including marketing exclusivity.
• Regenerative Medicine Advanced Therapy designation may not lead to a faster development or regulatory review or approval process and it does not increase the likelihood that a product candidate will receive marketing approval.
• We may be subject, directly or indirectly, to federal and state healthcare fraud and abuse laws, including anti-kickback and false claims laws, transparency laws, and health information privacy and security laws. If we are unable to comply, or have not fully complied, with such laws, we could face substantial penalties.
• Risks Related to the Development and Clinical Testing of Our Product Candidates
• Clinical development of new therapeutic products is a lengthy and expensive process with a high level of uncertainty as to timing and ultimate outcome.
• If we or our collaborators experience delays or difficulties enrolling or retaining patients in clinical trials of our product candidates, our research and development efforts and business, financial condition, and results of operations could be materially adversely affected.
• The results of preclinical studies and early clinical trials of our product candidates are not necessarily predictive of future results. Our product candidates may not have favorable results in later clinical trials despite positive results in preclinical and early clinical studies, which may have a material and adverse effect on our business and financial condition.
• Interim, topline and preliminary data from clinical trials of our product candidates that we or our collaborators publicly disclose from time to time may change as more patient data become available and are subject to audit, review and/or verification procedures that could result in final clinical data that is materially different and unfavorable.
• No assurances can be given that we will be able to continue to consistently manufacture clinical quantities of our product candidates in accordance with cGMP from a master and working cell bank system, or at a cost-effective or commercially viable scale, for one or more of our product candidates.
• Changes in or disruptions to our manufacturing operations could materially and adversely affect our business.
• Emerging, unknown, or previously unidentified infectious agents could affect one or more of our foundational cell lines or cell banks, require abandonment of a cell line, and materially delay or halt development of all product candidates dependent on that line.
• Our cell lines, cell banks, and product candidates may be affected by contaminants associated with animal- or human-derived materials used historically during IVF, derivation, or early expansion, and there can be no assurance that all such contaminants can be identified, tested for, or ruled out.
• Our pluripotent stem cell-derived product candidates may acquire genetic or epigenetic abnormalities, exhibit clonal selection or phenotypic drift, or contain residual undifferentiated cells, any of which could create safety risks (including tumorigenicity), reduce efficacy, complicate regulatory review, and require us to abandon or replace a foundational cell bank.
• The manufacturing, storage, and distribution of our cell therapy product candidates are vulnerable to cross-contamination, mix-ups, and sterility assurance failures, and any such event could lead to product loss, clinical holds, regulatory action, patient injury, reputational harm, and delays or inability to commercialize.
• Risks Related to Commercialization of our Product Candidates
• The commercial success of any of our current or future product candidates will depend upon the degree of market acceptance by physicians, patients, third-party payors, other healthcare providers and others in the medical community.
• If the market opportunities for our product candidates prove to be significantly smaller than we estimate, our business prospects may suffer.
• We face significant competition and the possibility that our competitors may develop therapies that are more effective, safer, more convenient, or less expensive than our product candidates. In addition, competitive products may be approved and successfully commercialized before ours, which may adversely affect our ability, or that of a strategic collaborator, to successfully commercialize our product candidates.
• We face potential product liability, and, if successful claims are brought against us, we may incur substantial liability and costs. If the use or misuse of our products or product candidates harm patients or is perceived to harm patients even when such harm is unrelated to our products or product candidates, our regulatory approvals could be revoked, suspended or otherwise negatively affected, our reputation could suffer, and we could be subject to costly and damaging product liability claims.
• We currently have no marketing and sales force or distribution capabilities. If we are unable to establish effective internal capabilities or effectively collaborate with third parties to market and sell our product candidates, if approved, our ability to generate product revenue will suffer.
• Risks Related to our Intellectual Property
• Our intellectual property may be insufficient to protect our products.
• Confidentiality agreements with employees and third parties may not prevent disclosure of trade secrets and other proprietary information.
• If we are unable to obtain and enforce patents and to protect our trade secrets, others could use our technology to compete with us, which could limit opportunities for us to generate revenues by licensing our technology and selling products.
• There is no certainty that our pending or future patent applications will result in the issuance of patents.
• Intellectual property we may develop using grants received from governmental entities are subject to rights maintained by those governments.
• We may become subject to claims for remuneration or royalties for assigned service invention rights by our employees, which could result in litigation and adversely affect our business.
• There is no certainty that we will be able to obtain licenses to intellectual property rights owned by third parties.
• Risks Related to our Dependence on Third Parties
• We may become dependent on possible future collaborations to develop and commercialize many of our product candidates and to provide the regulatory compliance, sales, marketing and distribution capabilities required for the success of our business.
• We do not have the ability to independently conduct clinical trials required to obtain regulatory approvals for our product candidates and we rely on third parties over whom we have limited control to perform important clinical and preclinical development activities for us.
• We obtain reagents and specialized materials and equipment required for the manufacture of our cell therapy product candidates from third-party manufacturers and suppliers, which include, in some instances, sole source manufacturers and suppliers. The loss of these suppliers, or their failure to provide us with sufficient key materials or equipment on a timely basis at an acceptable cost, or at all, could materially and adversely affect our business.
• Risks Related to Ownership of Our Common Shares
• The market price of our common shares has been and may continue to be volatile, and you could lose all or part of your investment.
• Because we do not intend to pay cash dividends, our common shares may not be a suitable investment for anyone who needs to earn dividend income.
• Our largest shareholder, who is affiliated with a member of our board of directors, owns a significant percentage of our common shares and will be able to exert substantial influence over the election of directors and matters subject to shareholder approval, including potential change of control transactions.
• If we or our subsidiaries issue additional common shares or preferred shares, investors in our common shares may experience dilution of their ownership interests.
• The issuance of common shares upon exercise of warrants would cause immediate and substantial dilution to existing shareholders.
• There is no assurance that we will be able to maintain compliance with the NYSE American’s continued listing standards, and failure to do so could result in the suspension of trading or delisting of our common shares, which could substantially impair our shareholders’ ability to sell their shares and our ability to raise additional capital.
• Our business could be negatively affected as a result of actions of activist shareholders, and such activism could affect the trading value of our securities.
• Securities analysts may not initiate coverage or continue to cover our common shares, and this may have a negative impact on the market price of our common shares.
• General Risk Factors
• We are subject to stringent and changing obligations related to data privacy and security. Our actual or perceived failure to comply with such obligations could lead to regulatory investigations or actions; litigation; fines and penalties; disruptions of our business operations; reputational harm; loss of revenue or profits; and other adverse business consequences.
• If our information technology systems or data, or those of third parties upon which we rely, are or were compromised, we could experience adverse consequences resulting from such compromise, including but not limited to regulatory investigations or actions; litigation; fines and penalties; disruptions of our business operations; reputational harm; and other adverse consequences.
• The use of social media platforms present risks and challenges.