Cellular Biomedicine Group Reports Q1 2020 Financial Results and Business Highlights

−  Anti-BCMA CAR-T for Relapsed or Refractory Multiple Myeloma

•  National Medical Products Administration of China (NMPA) accepted our IND application for Phase I clinical trial;

•  19 patients have been infused under investigator-initiated studies; 17 patients have evaluable data for clinical efficacy with only one grade 3 CRS observed;

−  Anti-CD19/CD20 Bi-Specific CAR-T for Non-Hodgkin's Lymphoma

•  4 patients have been infused under investigator-initiated studies; 3 patients have evaluable data for clinical efficacy;

−  On April 30, 2020, we received approval for CNY 30 million line of credit (approximately USD $4.2 million).

−  Cash Position: Cash, cash equivalents and restricted cash of March 31, 2020 were $21.6 million, compared to $15.4 million as of December 31, 2019;

−  Research & Development Expenses: R&D expenses were $7.8 million for the first quarter of 2020, compared to $6.0 million for the first quarter of 2019;

−  General & Administrative Expenses: G&A expenses were $3.4 million for the first quarter of 2020, compared to $3.4 million for the first quarter of 2019;

−  Net loss was $11.5 million for the first quarter of 2020, compared to $9.3 million for the first quarter of 2019;

−  Executed a bridge loan of $16 million.

CELLULAR BIOMEDICINE GROUP, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

March 31,

December 31,

2020

2019

 Assets

Cash and cash equivalents

$      21,597,360

$     15,443,649

Restricted cash

-

17,000,000

Other receivables

253,749

750,943

Prepaid expenses

1,707,265

835,048

Total current assets

23,558,374

34,029,640

Investments

-

240,000

Property, plant and equipment, net

21,338,143

21,434,414

Right of use

19,280,349

20,106,163

Goodwill

7,678,789

7,678,789

Intangibles, net

7,035,420

7,376,940

Long-term prepaid expenses and other assets

6,997,391

6,458,354

Total assets

$      85,888,466

$     97,324,300

Liabilities and Stockholders' Equity

Liabilities:

Short-term debt

$      14,000,000

$     14,334,398

Accounts payable

1,620,314

2,039,686

Accrued expenses

2,372,410

1,904,829

Taxes payable

30,420

26,245

Other current liabilities

5,509,393

5,367,708

Total current liabilities

23,532,537

23,672,866

Other non-current liabilities

17,204,688

17,933,743

Total liabilities

40,737,225

41,606,609

Stockholders' equity:

    Preferred stock, par value $.001, 50,000,000 shares authorized; none issued and outstanding as of March 31, 2020 and December 31, 2019, respectively

-

-

    Common stock, par value $.001, 300,000,000 shares authorized; 20,427,185 and 20,359,889 issued; and 19,371,686 and 19,304,390 outstanding, as of March 31, 2020 and December 31, 2019, respectively

20,427

20,360

   Treasury stock at cost; 1,055,499 shares of common stock as of March 31, 2020 and December 31, 2019, respectively

(14,992,694)

(14,992,694)

Additional paid in capital

273,535,311

272,117,518

    Accumulated deficit

(211,514,040)

(199,966,543)

    Accumulated other comprehensive loss

(1,897,763)

(1,460,950)

Total stockholders' equity

45,151,241

55,717,691

Total liabilities and stockholders' equity

$      85,888,466

$     97,324,300

CELLULAR BIOMEDICINE GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

For the Three Months Ended

March 31,

2020

2019

CASH FLOWS FROM OPERATING ACTIVITIES:

  Net loss

$ (11,547,497)

$ (9,336,788)

  Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization

1,593,078

1,329,699

Loss on disposal of assets

-

(23)

Stock based compensation expense

936,062

1,124,562

Other than temporary impairment on investments

240,000

-

  Changes in operating assets and liabilities:

Accounts receivable

-

788

Other receivables

493,853

(161,074)

Prepaid expenses

(884,281)

(1,038,324)

Long-term prepaid expenses and other assets

(472,222)

(378,024)

Accounts payable

(744,090)

426,027

Accrued expenses

486,538

12,704

Other current liabilities

599,822

155,980

Taxes payable

4,175

-

Other non-current liabilities

-

(71,221)

          Net cash used in operating activities

(9,294,562)

(7,935,694)

CASH FLOWS FROM INVESTING ACTIVITIES:

   Proceeds from disposal of assets

-

359

Purchases of intangibles

(51,687)

(619,165)

Purchases of property, plant and equipment

(1,582,479)

(3,545,355)

          Net cash used in investing activities

(1,634,166)

(4,164,161)

CASH FLOWS FROM FINANCING ACTIVITIES:

Net proceeds from the issuance of common stock

-

16,038,504

Proceeds from exercise of stock options

481,798

109,261

Proceeds from short-term debt

14,000,000

6,131,723

Repayment of short-term debt

(14,315,898)

-

Repurchase of treasury stock

-

(1,039,028)

          Net cash provided by financing activities

165,900

21,240,460

EFFECT OF EXCHANGE RATE CHANGES ON CASH

(83,461)

84,032

INCREASE (DECREASE) IN CASH,  CASH EQUIVALENTS AND RESTRICTED CASH

(10,846,289)

9,224,637

CASH,  CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD

32,443,649

52,812,880

CASH,  CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD

$  21,597,360

$ 62,037,517

SUPPLEMENTAL CASH FLOW INFORMATION

Income tax refund

$          3,200

$                -

Cash paid for income taxes

$             800

$        2,400

Interest expense paid

$        99,271

$      30,506

Interest income from pledged bank deposits received, netting off withholding tax

$      460,041

$                -

March 31,

March 31,

2020

2019

Reconciliation of cash, cash equivalents and  restricted cash in condensed consolidated statements of cash flows:

Restricted cash

$                  -

$ 17,000,000

Cash and cash equivalents

21,597,360

45,037,517

Cash, cash equivalents and restricted cash

$  21,597,360

$ 62,037,517

CELLULAR BIOMEDICINE GROUP, INC.

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS

(UNAUDITED)

For the Three Months Ended

March 31,

2020

2019

Net sales and revenue

$                      -

$                 49,265

Operating expenses:

Cost of sales

-

8,087

General and administrative

3,431,344

3,447,734

Selling and marketing

-

42,260

Research and development

7,759,358

5,968,096

Impairment of investments

240,000

-

         Total operating expenses

11,430,702

9,466,177

Operating loss

(11,430,702)

(9,416,912)

Other (expense) income

Interest income, net

12,772

97,034

Other expense, net

(127,792)

(14,510)

        Total other (expense) income

(115,020)

82,524

Loss before taxes

(11,545,722)

(9,334,388)

Income taxes provision

(1,775)

(2,400)

Net loss

$        (11,547,497)

$            (9,336,788)

Other comprehensive income:

Cumulative translation adjustment

(436,813)

396,126

Total other comprehensive income:

396,126

Comprehensive loss

$        (11,984,310)

$            (8,940,662)

Net loss per share :

  Basic and diluted

$                  (0.60)

$                    (0.51)

Weighted average common shares outstanding:

  Basic and diluted

19,340,982

18,152,429