Equity Research




Orgenesis Inc.

(ORGS / NasdaqCM / $2.94)

March 18, 2020


Business Overview



Orgenesis Inc. (the Company) is developing point-of-care (POCare) solutions for development and commercialization of cell and gene therapies (CGTs), which are large and very rapidly growing markets. CGTs strive to prevent or treat human disease by administering to a patient his own cells that have been processed and treated ex vivo.


CGTs are focused on a great variety of treatments, including cell-based immunotherapies, therapeutics for metabolic diseases, neurodegenerative diseases, and tissue regeneration.


An industry source estimates that the annual global market for cell and gene medicines will expand sharply to approximately $150 billion by 2025.


The POCare business model, initiated in second-quarter 2019, represents a paradigm shift in the industry, reflecting cell processing and treatment within the POCare setting; delivery of unique cell and gene therapy capabilities in a cost effective, high quality, and scalable manner; a global network of leading healthcare facilities; and an expanding therapeutic pipeline based on academic and hospital collaborations.


The POCare platform is designed to help hospitals and academic institutions take innovative therapies from the research lab to the market and into patients at scale. The Company provides therapeutic product development assistance; POCare processing, manufacturing, and production expertise; therapeutic regulatory and clinical assistance; and therapeutic product commercialization and distribution.


Management believes that an efficient POCcare system will lower the high costs of CGTs, including Immuno-oncology therapies by up to 90%.


The Company has considerable validation of its IP strategy, as it has many licensed therapeutics and achieved technology milestones.



2020 Focus



The worldwide clinical trial pipeline bodes well for continuing expansion of the market. There are approximately 946 CGT-related clinical trials underway, with 53% of them in oncology. Approximately 82 of the trials are in Phase 3.


Management is striving to establish additional joint ventures with leading universities and healthcare institutions worldwide, thereby providing the Company with development funding for therapies, reducing risk, and creating a faster pathway to market versus the traditional biotech model.


A February 2020 collaboration agreement with the John Hopkins University to develop and supply a variety of cell and gene therapies and technologies is the third major such agreement signed by an international institution in recent months.



Orgenesis Sold a Business to Focus on POCare Solutions for CGTs



The Company generated significant value by building and selling its contract development manufacturing organization (Masthercell Global, Inc.) in February 2020. The revenues of that business had grown from $3 million in 2015 to a run rate of approximately $30 million.


The sale price of $315 million generated net proceeds of $127 million.






The backgrounds of the management and directors are outlined on the ORGS website. The individuals have significant experience in CGTs and other biotechnologies, early stage companies, international marketing, as well as corporate finance and capital markets. Vered Caplan, CEO, is the chief operating decision-maker.






Income Statement (12 months through 12/31/19 vs. 11/30/18) (prior to sale of Masthercell)


Revenue: 33,256,000 vs. 18,655,000

Gross profit: 15,024 vs. 7,831

Operating income (loss): (24,604,000) vs. (13,919,000)

Other income (expense): (874,000) vs. (3,848,000)

Pretax income (loss): (25,478) vs. (17,767)

Net income (loss): (26,041,000) vs. (19,104,000)

Net income (loss) attributable to Orgenesis: (24,121,000) vs. (18,291,000)

Net income (loss) per basic common share: (1.77) vs. (1.43)



Balance Sheet (12/31/19) (prior to $127,000,000 net proceeds from sale of Masthercell)


Cash & equivalents: 11,388,000

Total current assets: 25,979,000

Total assets: 92,495,000

Current liabilities: 31,579,000

Long-term liabilities: 23,883,000

Redeemable non-controlling interest: 30,955,000

Equity attributable to Orgenesis Inc.: 5,477,000

Number of common shares outstanding (03/09/20): 18,361,050



Valuation Considerations



The market for CGTs is large and growing very rapidly. The Orgenesis POCare operations presently have only a small revenue base, but Orgenesis has plans to transform development and commercialization of various therapies through POCare solutions.


The cash position is robust following sale of Masthercell Global, Inc. and a $9.2 million private placement in January 2020. New joint ventures might provide additional funding for therapies.


On January 20, 2020, the Company sold 2,200,000 shares of its common stock at $4.20 per share; the buyers also received three-year warrants to purchase up to 1,000,000 common shares at $5.50 apiece. On March 18, 2020, ORGS filed an S-3 Registration Statement for those common and warrant shares.


The enterprise value of the Company well exceeds its market capitalization.


The impact from COVID-19 remains an uncertainly. In addition, the Company website and SEC filings list a number of risks and are hereby incorporated by reference.






Executive offices: 20271 Goldenrod Lane, Germantown, MD 20876; Phone 480 659 6404


Investor contact: David Waldman, Crescendo Communications, LLC; Phone 917.355.2239


ORGS Website






TickerBuzz, LLC ("TickerBuzz"), a Florida limited liability company is the author of this Profile. TickerBuzz is not and does not act as a broker-dealer, investment advisor, placement agent, or crowdfunding portal. Furthermore, it does not offer any securities, nor does it provide any investment advice or analysis. The source material for this Profile is the Company presentation materials. Certain information, particularly information relating to future performance and other business matters, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act. TickerBuzz cautions that these forward-looking statements are subject to numerous assumptions, risks, and uncertainties that may change over time and cause actual results to differ materially from the results discussed herein. The forward-looking statements are neither predictions nor guarantees of future events or performance. TickerBuzz has no obligation to update any forward-looking statements after they are made, except as required by applicable law. All of this information is intended for discussion purposes only, is not a solicitation to buy or sell any security, and must not be relied upon for financial, legal, tax, or any other professional advice. The Company has not paid TickerBuzz any compensation for publication of this Profile. Analyst: William J. Ritger.



TickerBuzz, LLC


Contact: William J. Ritger, writger@gmail.com, 561.891.1903

Copyright 2020. TickerBuzz, LLC. All rights reserved.