GNMX Aevi Genomic Medicine Inc

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

________________________

 

FORM 8-K

 

Current Report

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

February 13, 2015 (February 13, 2015)

Date of Report (Date of earliest event reported)

 

MEDGENICS, INC.

(Exact name of registrant as specified in its charter)

 

Delaware	1-35112	98-0217544
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification No.)

 

435 Devon Park Drive, Building 700

Wayne, Pennsylvania 19087

(Address of principal executive offices, zip code)

 

(610) 254-4201

(Registrant’s telephone number, including area code)

 

Not Applicable

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Item 2.02 Results of Operations and Financial Condition.

 

On February 13, 2015, Medgenics, Inc. (the “Company”) issued a press release regarding its financial results for the three and twelve months ended December 31, 2014. A copy of this press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

 

The information furnished in this report under this Item 2.02, including Exhibit 99.1 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933.

 

Item 7.01. Regulation FD Disclosure.

 

As previously announced, the Company will host a conference call and live audio webcast on Friday, February 13, 2015 at 8:30 a.m. EST to discuss fourth quarter and full year 2014 financial results. The Company intends to refer to the slide presentation, attached as Exhibit 99.2 and incorporated by reference herein, on the conference call.

 

The slide presentation, together with an archive of the webcast, will also be available for 30 days after the date of the conference call in the Investor section of the Company’s website at www.medgenics.com.

 

The information furnished in this report under this Item 7.01, including Exhibit 99.2 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such a filing.

 

This Current Report on Form 8-K, including the exhibits attached hereto, contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and as that term is defined in the Private Securities Litigation Reform Act of 1995, which include all statements other than statements of historical fact, including (without limitation) those regarding the Company’s financial position, its development and business strategy, its product candidates and the plans and objectives of management for future operations. The Company intends that such forward-looking statements be subject to the safe harbors created by such laws. Forward-looking statements are sometimes identified by their use of the terms and phrases such as “estimate,” “project,” “intend,” “forecast,” “anticipate,” “plan,” “planning, “expect,” “believe,” “will,” “will likely,” “should,” “could,” “would,” “may” or the negative of such terms and other comparable terminology. All such forward-looking statements are based on current expectations and are subject to risks and uncertainties. These risks and uncertainties include, but are not limited to, those discussed in the section titled “Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2014. Should any of these risks or uncertainties materialize, or should any of the Company’s assumptions prove incorrect, actual results may differ materially from those included within these forward-looking statements. Accordingly, no undue reliance should be placed on these forward-looking statements, which speak only as of the date made. The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based. As a result of these factors, the events described in the forward-looking statements contained in this Current Report on Form 8-K, including the exhibits attached hereto, may not occur.

 

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits. The following exhibits are furnished herewith:

 

Exhibit No.	Description
99.1	Medgenics, Inc. Press Release dated February 13, 2015 (furnished pursuant to Item 2.02).
99.2	Slide Presentation dated February 13, 2015 (furnished pursuant to Item 7.01).

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

	MEDGENICS, INC.
	By:		/s/ John Leaman
			Name: John Leaman
			Title: Chief Financial Officer

 

Date: February 13, 2015

 

 

Exhibit 99.1

 

 

News Release

 

Medgenics Reports Fourth Quarter and Full Year 2014 Financial Results

 

·

Proof of concept established for TARGTTM platform

·

Enrollment initiated in mid-dose arm of MDGN-201 study; low-dose arm fully enrolled

·

Preclinical peptide programs advancing

·

Prioritizing CHOP collaboration programs

 

Philadelphia, PA (February 13, 2015) – Medgenics, Inc. (NYSE: MDGN) (the Company), the developer of a proprietary platform for the sustained production and delivery of therapeutic proteins and peptides in patients using ex vivo gene therapy and their own tissue for the treatment of orphan diseases, today announced fourth quarter and full year 2014 financial results.

 

Management Commentary

 

“We are excited by the progress the company has made during the past year,” stated Mike Cola, Chief Executive Officer of Medgenics. “We have substantially re-engineered our TARGT (Transduced Autologous Restorative Gene Therapy) platform, resulting in the ability to deliver sustained, physiologically relevant levels of endogenous erythropoietin (eEPO) for End Stage Renal Disease (ESRD) patients. We have demonstrated the ability to maintain patient hemoglobin levels within the accepted target range without the use of recombinant erythropoietin (rHuEPO) for up to 8 months thus far. The delivery of therapy at physiologic levels suggests that TARGT_EPO is potentially capable of addressing the safety issues evident with existing rHuEPO therapies, including hypertension and increased cardiovascular complications. In addition to the clinical benefits, we believe these results demonstrate a positive proof of concept for the platform, and we look forward to expanding the platform into additional therapeutic areas. We anticipate sharing clinical data from these additional TARGT_EPO indications throughout the course of the year.

 

Furthermore, we have broadened the TARGT platform by inventing a novel method to produce therapeutic peptides in vivo, as evidenced by our ongoing TARGT_GLP-2 program. We continue to progress multiple novel preclinical peptide programs, and we anticipate being in a position to discuss the first of these programs by mid-year.

 

We look forward to discussing these results during our fourth quarter conference call and webcast.”

 

 

Conference Call and Webcast

 

Medgenics will host a conference call and live audio webcast on Friday, February 13, 2015 at 8:30 a.m. EST to discuss fourth quarter and full year 2014 financial results.

 

In order to participate in the conference call, please dial (844) 466-4113 (domestic) or (765) 507-2652 (international). The conference ID number is 76989330.

 

 

The live webcast can be accessed under “Events” in the Investors section of the Company’s website at www.medgenics.com or you may use the link: http://edge.media-server.com/m/p/evkjbrtv/lan/en.

 

A replay of the call will be available two hours after the end of the conference on February 13, 2015 through February 20, 2015. To access the replay, please dial (855) 859-2056 (domestic) or (404) 537-3406 (international) and reference the conference ID number.

 

The archived webcast will be available for 30 days in the Investor section of Medgenics’ website at www.medgenics.com.

 

 

Fourth Quarter Financial Results

 

The Company also reported financial results for the three and twelve months ended December 31, 2014 and the filing with the U.S. Securities and Exchange Commission (SEC) of the Company’s Annual Report on Form 10-K. The Form 10-K includes audited annual consolidated financial statements containing the information presented below, as well as additional information regarding the Company. The Form 10-K is available at www.sec.gov and at www.medgenics.com.

 

Gross research and development (R&D) expenses for the three months ended December 31, 2014 increased to $4.11 million from $2.31 million for the same period in 2013. This increase was due mainly to an increase in license fees and research expenses. Net R&D expenses for the three months ended December 31, 2014 increased to $3.77 million from $2.07 million for the same period in 2013. The increase in net R&D expenses was due to the increase in gross R&D expenses offset in part by participation by the OCS of $0.34 million in the three months ended December 31, 2014 compared with $0.25 million for the same period in 2013.

 

General and administrative expenses for the three months ended December 31, 2014 were $2.42 million, decreasing from $3.83 million for the same period in 2013 primarily due to a decrease in professional fees.

 

Financial expenses for the quarters ended December 31, 2014 and 2013 were immaterial.

 

Financial income for the quarter ended December 31, 2014 was $0.01 million, decreasing from $0.70 million for the comparative quarter in 2013. The decrease was primarily due to the change in valuation of the warrant liability.

 

The Company reported cash and cash equivalents of $33.29 million at December 31, 2014.

 

For the quarter ended December 31, 2014 the Company reported a loss of $6.20 million or $0.30 per share, compared with a loss of $5.21 million or $0.28 per share for the comparative quarter in 2013.

 

 

Full Year 2014 Financial Results

 

Gross research and development (R&D) expenses for the year ended December 31, 2014 increased to $10.49 million from $8.87. Net R&D expenses for the year ended December 31, 2014 increased to $8.25 million from $7.30 million in 2013 primarily due to an increase in license fees and an increase in stock-based compensation expense. The increase in net R&D expenses was due to the increase in gross R&D expenses offset in part by participation by the OCS of $2.24 million in 2014 compared with $1.57 million in 2013.

 

 

General and administrative expenses for the year ended December 31, 2014 were $10.69 million, increasing from $10.52 million in 2013 primarily due to increased personnel and an increase in stock-based compensation expenses offset by a decrease in professional fees.

 

Financial expenses for the year ended December 31, 2014 increased to $0.07 million from $0.02 million in 2013, mainly due to foreign currency exchange differences.

 

Financial income for the year ended December 31, 2014 was $0.59 million, decreasing from $0.73 million in 2013. The decrease was primarily due to the change in valuation of the warrant liability.

 

The Company reported cash and cash equivalents of $33.29 million at December 31, 2014.

 

For the year ended December 31, 2014 the Company reported a loss of $18.43 million or $0.96 per share, compared with a loss of $17.13 million or $0.97 per share in 2013.

 

		MEDGENICS, INC. AND ITS SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
U.S dollars in thousands (except share and per share data)
		December 31,				December 31,
		2013				2014
ASSETS
CURRENT ASSETS:
Cash and cash equivalents		$	22,390			$	33,288
Accounts receivable and prepaid expenses			202				315
Total current assets			22,592				33,603
LONG-TERM ASSETS:
Restricted lease deposit			42				83
Severance pay fund			96				99
Property and equipment, net			357				495
Total long-term assets			495				677
Total assets		$	23,087			$	34,280
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Trade payables		$	1,062			$	1,076
Other accounts payable and accrued expenses			1,952				2,562
Total current liabilities			3,014				3,638
LONG-TERM LIABILITIES:
Accrued severance pay			439				368
Liability in respect of warrants			1,211				612
Total long-term liabilities			1,650				980
Total liabilities			4,664				4,618
STOCKHOLDERS' EQUITY:
Common stock-$0.0001 par value; 100,000,000 shares authorized; 24,851,075 shares issued and 24,818,075 shares outstanding at December 31, 2014; 18,497,307 shares issued and outstanding at December 31, 2013			2				3
Additional paid-in capital			100,126				129,797
Accumulated deficit			(81,705	)			(100,138	)
Total stockholders' equity			18,423				29,662
Total liabilities and stockholders' equity		$	23,087			$	34,280

 

 

					MEDGENICS, INC. AND ITS SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
US Dollars in thousands (except share and per share data)
		Year ended December 31,
		2012				2013				2014
Research and development expenses		$	7,187			$	8,870			$	10,490
Less:
Participation by the Office of the Chief Scientist			(1,756	)			(1,573	)			(2,237	)
Research and development expenses, net			5,431				7,297				8,253
General and administrative expenses			7,197				10,521				10,686
Operating loss			(12,628	)			(17,818	)			(18,939	)
Financial expenses			(2,429	)			(20	)			(68	)
Financial income			5				726				586
Loss before taxes on income			(15,052	)			(17,112	)			(18,421	)
Taxes on income			19				17				12
Loss		$	(15,071	)		$	(17,129	)		$	(18,433	)
Basic loss per share		$	(1.37	)		$	(0.97	)		$	(0.96	)
Diluted loss per share		$	(1.37	)		$	(1.06	)		$	(1.00	)
Weighted average number of shares of Common stock used in computing basic loss per share			11,023,881				17,629,436				19,246,611
Weighted average number of shares of Common stock used in computing diluted loss per share			11,023,881				17,683,510				19,294,259

 

 

About the MDGN-201 Clinical Trial

 

The open-label trial is evaluating the safety and efficacy of sustained eEPO therapy for anemia in end-stage renal disease (ESRD) patients. The trial will enroll up to 18 patients that require treatment for anemia.   The trial endpoints include plasma eEPO levels, hemoglobin, hematocrit and reticulocytes levels and safety assessment. Each patient will be followed for at least one year.  Additional details may be found on www.clinicaltrials.gov using identifier NCT02117427.

 

About Chronic Kidney Disease (CKD) and ESRD

 

CKD is a progressive loss of kidney function over months to years. The three most common causes of CKD are diabetes mellitus, hypertension and glomerulonephritis.  ESRD is also known as Stage 5 CKD. ESRD requires kidney replacement therapy, either dialysis or kidney transplantation.

 

About Medgenics

 

Medgenics is developing the TARGT^™ (Transduced Autologous Restorative Gene Therapy) system (formerly known as BioPump), a proprietary platform for the sustained production and delivery of therapeutic proteins using ex vivo gene therapy and the patient's own tissue for the treatment of orphan and rare diseases. For more information, visit the Company’s website at www.medgenics.com.

 

Forward-looking Statements

 

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and as that term is defined in the Private Securities Litigation Reform Act of 1995, which include all statements other than statements of historical fact, including (without limitation) those regarding the Company's financial position, its development and business strategy, its product candidates and the plans and objectives of management for future operations. The Company intends that such forward-looking statements be subject to the safe harbors created by such laws. Forward-looking statements are sometimes identified by their use of the terms and phrases such as "estimate," "project," "intend," "forecast," "anticipate," "plan," "planning, "expect," "believe," "will," "will likely," "should," "could," "would," "may" or the negative of such terms and other comparable terminology. All such forward-looking statements are based on current expectations and are subject to risks and uncertainties. Should any of these risks or uncertainties materialize, or should any of the Company's assumptions prove incorrect, actual results may differ materially from those included within these forward-looking statements. Accordingly, no undue reliance should be placed on these forward-looking statements, which speak only as of the date made. The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based. As a result of these factors, the events described in the forward-looking statements contained in this release may not occur.

 

 

Contacts:

 

Medgenics, Inc.

John Leaman

john.leaman@medgenics.com

 

Medgenics, Inc.

Brian Piper

240-899-5554

brian.piper@medgenics.com

 

Stern Investor Relations

Beth DelGiacco

212-362-1200

Beth@sternir.com

 

 

Exhibit 99.2

 

Q4 2014 Results February 13, 2015

Forward Looking Statement This presentation includes certain estimates and other forward - looking statements within the meaning of Section 21 E of the Securities Exchange Act of 1934 , as amended, including statements with respect to anticipated operating and financial performance, clinical results, potential partnerships, licensing opportunities and other statements of expectation . Words such as “ expects, ” “ anticipates, ” “ intends, ” “ plans, ” “ believes, ” “ assumes, ” “ seeks, ” “ estimates, ” “ should ” and variations of these words and similar expressions, are intended to identify these forward - looking statements . While we believe these statements are accurate, forward - looking statements are inherently uncertain and we cannot assure you that these expectations will occur and our actual results may be significantly different . These statements by the Company and its management are based on estimates, projections, beliefs and assumptions of management and are not guarantees of future performance . Important factors that could cause actual results to differ from those in the forward - looking statements include the factors described in the Company ’ s filings with the U . S . Securities and Exchange Commission . The Company disclaims any obligation to update or revise any forward - looking statement based on the occurrence of future events, the receipt of new information, or otherwise . 2

Agenda 3 • 2014 Recap • MDGN - 201 Clinical Update • Early Stage Pipeline • Collaborations • Q4 Financial Update • 2015 Milestones

Significant Achievements of 2014 4 • Re - engineered the TARGT ex vivo gene therapy platform – Created significant performance improvements in protein expression and duration of secretion • Demonstrated platform improvements in the open - label, ascending d ose study in ESRD patients – Demonstrated ability of TARGT EPO to maintain target Hb levels for up to 8 months to date • Broadened platform capability by inventing a novel method to produce peptides using the TARGT platform – Achieved preclinical proof of concept in TARGT GLP - 2 • Executed broad genetic research collaboration – Exclusive license with Children’s Hospital of Philadelphia (CHOP) to use the rare and orphan disease samples at the Center for Applied Genomics (CAG) for the purpose of developing and commercializing therapeutic treatments and diagnostic targets for rare and orphan diseases • Completed fundraising during Q4, providing ~ 24 month cash runway

MDGN - 201 Study Update 5

6 Trial MDGN - 201 TARGT EPO Location Israel Phase I - II Indication End Stage Renal Disease Sites Multi center Status Enrolling mid dose MDGN - 201 (TARGT EPO ) – Open Label Ascending Dose

MDGN - 201 (TARGT EPO ) – Open Label Ascending Dose • End Stage Renal Disease (ESRD) – Renal failure and low baseline eEPO secretion – Require rHuEPO 2 - 3x/week • Hemodialysis dependent (3x weekly) – Significantly shortens red blood cell (RBC) lifespan – Ongoing blood loss from dialysis and testing • Concomitant diseases – Diabetes – Hypertension – Cardiovascular disease 7 Patient Profile

MDGN - 201 (TARGT EPO ) – Open Label Ascending Dose 8 Clinical endpoints: (1) Serum eEPO levels (2) Hb levels (3) Duration (4) Safety Study Summary Group Treatment N A Low dose eEPO 18 - 25 IU/kg/day 3 + 3 * B Mid dose eEPO 35 - 45 IU/kg/day 3 + 3 * C High dose eEPO 55 - 65 IU/kg/day 3 + 3 * MDGN - 201 Phase 1/2 Trial Design Enrollment and dose selection Screening Harvest procedure Ex vivo viral transduction 9 days Treatment and follow - up 12 months Safety follow - up 6 months Implantation procedure 4 weeks run - in * Initial cohort of 3 , expandable to 6 based on response Objective : determine dose of TARGT EPO sufficient to maintain hemoglobin in target range [9 - 11,<12 g/ dL ] for > 6 months in ESRD patients

9 Subject # Age Gender Dialysis (years) Medical History rHuEPO Run - in Dose (IU/ wk ) # of TARGT s Months Post Implant Status E101 70 M 4 hypertension, diabetes 12,000 3 8 Ongoing ; s table Hb E202 76 M 9 hypertension, stroke, MI 20,000 2 4 Ongoing; stable Hb E203 67 M 1 diabetes 20,000 3 3 Ongoing; stable Hb E204 64 F 0.75 hypertension 8,000 3 2 Ongoing; stable Hb E102 26 M 0.8 hypertension, IgA nephropathy 12,000 2 5 Returned to baseline; received rHuEPO . Exited study. E201 74 F 1.4 hypertension, diabetes, stroke 20,000 1 2 Required rHuEPO following surgery unrelated to therapy. Exited study. Summary Patient Status – Low Dose Cohort

Progress To Date • Low - dose cohort fully enrolled – P ositive response to therapy at ~ 100x lower c max and 10x lower overall exposure vs rHuEPO – Low - dose well tolerated; no treatment related SAE’s – Inter - patient variability similar to that observed with other gene therapies • Demonstrated ability to maintain Hb in target range for up to 8 months to date – Optimal dose not yet established • Initiated enrollment in mid - dose cohort – L onger durability of response expected while maintaining Hb in targeted range • Encouraged by feedback from pre - IND meeting for TARGT EPO renal failure indications – Anticipate filing IND during Q1 2015 10

The Need for Alternatives to Current EPO Therapies 11 • Significant safety concerns related to rHuEPO remain – Increased risk of thromboembolic events (evidenced by CHOIR, TREAT studies) – Increased risk of cancer progression – Supra - therapeutic levels of rHuEPO have been implicated • FDA class label (June 2011) – “…no trial has identified a hemoglobin target level, ESA dose, or dosing strategy that does not increase these risks... ” • Multiple alternative approaches to replace rHuEPO therapy are being pursued – Biology of alternative approaches is not well understood – Will new safety issues emerge?

Opportunity for TARGT EPO 12 • M imics natural system – Well characterized biology – Continuous, autologous, physiologic EPO – Superior safety and efficacy profile • Alternative to rHuEPO for patients inadequately or not treated due to: – H igh risk for thromboembolic events – History of cancer – Hypertension • Clinical programs in up to 5 orphan indications will be initiated in 2015 – De - risk programs with small signal finding studies (6 - 15 patients each) – Interim results expected in H2 2015 – R elatively small pivotal trials required

Orphan Indications for TARGT EPO 13 INDICATION PATIENT / PAYOR NEED CLINICAL RATIONALE ESTIMATED PREVALENCE PERITONEAL DIALYSIS (PD) PD provides 20% cost reduction vs hemodialysis Improved compliance will boost outcomes and reduce costs for PD patients 20,000 (US) 6 ANEMIC CKD TRANSPLANT CANDIDATES Heightened immunogenic profile due to repeat transfusions Reduced transfusions will prevent increased immunogenicity, shorten wait times and improve transplant outcomes 10,000 (US) 6 HYPO - RESPONDERS TO rHuEPO Unable to manage anemia on max dose of rHuEPO Continuous, physiologic levels of eEPO will stimulate bone marrow more effectively and safely than intermittent IV dosing 5 40,000 – 70,000 (US) 6 MYELODYSPLATIC SYNDROMES (MDS) 20 - 55% of MDS patients respond to rHuEPO but use limited due to safety concerns 3 Reduced need for transfusions would limit iron overload 60,000 (US) 4 BETA THALASSEMIA INTERMEDIA Requires frequent transfusions (up to 12 per annum) rHuEPO shown ability to raise Hb in beta thalassemia 1 ; safety concerns limit use 15,000 (US/EU) 2 1. Oliveri NF et al. Blood 1992 , 80:3258 - 60 2. Weatherall , D.J. and Clegg, J.B. Bulletin of the World Health Organization , 2001 , 79 : 704 – 712 . 3. Giraldo , P. et al Cancer : 107 - 2807 - 14 4. Am Journal Med. 2012 , Jul: 125 ( 7 Suppl ):S 2 - 5 5 . Source : Besarab , A. Semin Nephrol . 2000 ; 20 ( 4 ): 364 6 . U.S . Renal Data System, USRDS 2013 Annual Data Report and primary company research

Early S tage P ipeline • GLP - 2 – Produced both native GLP - 2 and Gattex ® – SCID mouse experiments demonstrated ability to produce clinically relevant levels of GLP - 2 – Achieved proof of biological activity as measured by villus lengthening – Pre - IMPD meeting mid year to determine development pathway • Novel preclinical program to be announced by mid - year 14

Collaboration Partners 15 PARTNER SCOPE KEY DELIVERABLES Children’s Hospital of Philadelphia (CHOP) Exclusive license to use the rare and orphan disease samples at the Center for Applied Genomics (CAG) for the purpose of developing and commercializing therapeutic treatments and diagnostic targets for rare and orphan diseases Working with CHOP team to prioritize programs . Anticipate revealing lead program by mid - year. Harvard University / Massachusetts General Hospital Funding of research program to a ssess the viability of TARGT micro - organs in the CNS Anticipate results from initial preclinical experiments mid - year. Stanford University License to novel AAV vector, pLK19, for ex vivo use in the TARGT platform Provide vector flexibility for TARGT platform . GMP manufacturing in H2 2015.

Financial Update 16

Q4 2014 - Results of Operations • Net R&D expenses for the 4 th Quarter were $3.8MM increasing from $2.1MM for the same period in 2013 due to an increase in license fees and research expenses • G&A expenses for the 4 th Quarter were $2.4MM decreasing from $3.8MM for the same period in 2013 mainly due to a decrease in professional fees • Net R&D expenses for the year ended December 31, 2014 were $8.3MM – Increase from $7.3MM in 2013 – Primarily due an increase in license fees and an increase in stock - based compensation expense • G&A expenses for the year ended December 31, 2014 were $ 10.7MM – Increase from $10.5MM in 2013 – Increase in personnel and stock - based compensation expenses offset by decrease in professional fees • Completed fundraising in Q4. Gross proceeds: $ 24.2MM • Cash balance as of December 31, 2014 was $ 33.3MM 17

2015 Milestones 18 PROGRAM TIMING RENAL ANEMIA Complete enrollment in low dose MDGN - 201 cohort ✓ Initiate enrollment in mid dose MDGN - 201 cohort ✓ Initiate Phase 2 study in Peritoneal Dialysis (PD), including: Q1 15 - Renal Anemia Transplant patients - ESA Hypo - responsive patients HEMATOLOGICAL DISORDERS Initiate Phase 2 study in Myelodysplastic Syndrome (MDS) Q2 15 Pre - IMPD meeting for Beta Thalassemia Intermedia H2 15 PRECLINICAL Pre - IMPD meeting for GLP - 2 H1 15 Lead program from CHOP collaboration H2 15