Geron Corporation (
Q3 2010 Earnings Call
October 29, 2010 11:00 a.m. ET
David Greenwood - EVP & CFO
Thomas Okarma - President & CEO
Joel Sandek - Lazard Capital Markets
Reni Benjamin - Rodman
Mark Monane - Needham & Company
Steve Brozak - WBB Securities
Previous Statements by GERN
» Geron Corporation Q2 2010 Earnings Call Transcript
» Geron Corporation Q1 2010 Earnings Call Transcript
» Geron Corporation Q1 2008 Earnings Call Transcript
» Geron Corporation Q4 2007 Earnings Call Transcript
Good day, ladies and gentlemen, and welcome to the third quarter 2010 Geron earnings conference call. My name is Kristal, and I will be your operator for today. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. (Operator instructions) I would now like to turn the conference over to your host for today, Mr. David Greenwood, Executive Vice President and Chief Financial Officer. Please proceed.
Thank you. Good morning and welcome to the Geron third quarter call. I am David Greenwood. Tom Okarma is with me. This is an earnings related conference call, and we will begin with a summary of operating results for the quarter. Our agenda then includes an overview of recent operating highlights at the company and a summary of our operating plans for the remainder of 2010 and to 2011. Following that update by Tom, we will have a general Q&A session.
First, two informational items, in the event of forward-looking statements that are made during this call, please understand those comments are made subject to the Safe Harbor provisions of the Securities Act of ‘95. Any forward-looking statement involves uncertainty and we refer you to the risk factors detailed in our filings with the SEC. Secondly, participants are currently in listen-only mode, the lines will open for the Q&A, the call will be available for webcast replay until the end of November and we still have our website for constructions.
Revenues from license fees and royalties were up over the comparable three-month period in 2009 and the comparative number for nine months year-to-date is also up over 2009, but the 2.5 million level for nine months, these numbers are not overly significant. Other cash inflows to the company during the quarter included 220,000 of interest income, a smallish amount that reflects the positioning of the yield curve. Our marketable securities portfolio remains intact with no write-downs or provisions for write-downs.
Third quarter R&D expenses were flat period-to-period, but that is coincidental and mostly a function of timing differences in purchasing drug products and funding clinical trial sites. Nine-month R&D expenses were slightly below the 2009 number, but again coincidental and for the same reasons. G&A expenses were up for the quarter and the nine-month period which reflects consulting expense and of course non-cash stock-based compensation expense.
We end the quarter with 146 million cash on the balance sheet. Our current running rate net burn number is in the 48 million annualized. So, the company is funded for the near-term.
Thank you, David. Good morning everyone and thank you all for dialing in. The big event in the quarter was really the October 11 announcement that Geron initiated the world's first embryonic stem cell trial in patients with subacute complete thoracic spinal cord injury. This was obviously a major milestone for Geron and for the field.
We got a great deal of global news coverage. Diane Sawyer's evening news program were covered in China, Japan, the U.K. and all over Europe. So, it was a nice celebration of a lot of work on having them accomplished. So, currently, we have two sites in the U.S. that are enrolling patients. They are screening patients. We expect to initiate two more before year's end and two to three more early in next year. And these sites will be with us for the complete program as we progress from low dose complete thorasics, through dose escalation studies and advancing the study into the cervical patients.
While we will not be commenting patient-by-patient or week-by-week, given that this was the first subject. But I will comment that the injection was completely uneventful. Patient is doing fine and the first repeat MRI showed no deleterious impact from either the injection or from the injected cells which is precisely what we have hoped and expect. So, we are off to a good start.
Secondly, in early October, we announced the launch of the GE Healthcare human cardiomyocyte product for drug discovery and tox screening. This was really another milestone for Geron in the sense that it is the second royalty bearing to Geron product that we launched this year. The first being was the being the Synthemax flask for. Growing without feeders for attachment proteins embryonic stem cells. That's deemed a co-development project between Geron and Corning Glass.
So, the GE cardiomyocyte product is a step forward, generally in the sophistication with which drug discovery and tox screening can be performed. And they know that before this product was launched, the only way to do tox screening was with animal Purkinje fibers, which are problematic. Their spectrum of sensitivity to different high-end channel blockers does not resemble that of man. There is a lot of extra work one has to do to normalize the base line before you get the read in these older animal assays.
These are completely normal human cardiomyocytes and they can be used for a variety of screens from manual patch clamping which is the standard way that drug companies examine the impact of a drug on calcium or hERG dual channel blockers all the way to high content screening where you can use some very sophisticated imaging software to clear a lots of metabolic pathways within the cardiomyocyte cell.