Orchard Therapeutics PLC – ADR (NASDAQ: ORTX) stock fell over 3.8% on 28th May, 2019 (As of 11:57 am GMT-4; Source: Google finance) after the company in the first quarter of FY 19 has reported the net loss attributable to ordinary shareholders of $30.7 million compared to $15.3 million in the same period in 2018. The company has generated the cash, cash equivalents and restricted cash as of March 31, 2019 were $299.2 million compared to $339.7 million as of December 31, 2018. The decline was primarily due to cash used to fund operations for the quarter, including a paydown of 2018 accrued expenses and deferred payments for inventory and transition services under the April 2018 agreement with GSK.
Moreover, during the first quarter, Research and development expenses rose to $17.5 million compared to $9.2 million in the same period in 2018. The increase was mainly due to costs associated with clinical-stage programs acquired from GSK in April 2018. Personnel-related costs have also increased by $4.2 million due to an increase in headcount over the prior year to support the company’s growth and to assist in the further development of the product candidates and pipeline.
Meanwhile, in May, ORTX has signed a five-year senior credit facility for up to $75 million with MidCap Financial. Twenty-five million dollars of the facility is planned to be funded on or around May 28, 2019, which will access the access of remaining $50 million in two tranches subject to the achievement of certain clinical and regulatory milestones and other customary conditions. The facility provides for an interest-only period of up to 36 months and bears interest at a rate of LIBOR plus 6%. The company anticipates that its cash and investments as of March 31, 2019, along with the borrowing capacity from the senior credit facility with MidCap Financial, will fund its projected operating and capital expenditure requirements into 2021.
Additionally, ORTX, Fondazione Telethon and Ospedale San Raffaele today announced that Orchard has been granted an exclusive worldwide license to intellectual property rights to research, develop, manufacture and commercialize the ex vivo autologous hematopoietic stem cell (HSC) gene therapy program for the treatment of Mucopolysaccharidosis Type I (MPS-I) developed by the San Raffaele-Telethon Institute for Gene Therapy (SR-Tiget) in Milan, Italy. The program has currently shown encouraging preliminary data with signs of metabolic correction in patients with the most severe subtype of MPS-I, known as Hurler syndrome.