NASDAQ:FBLG
READ THE FULL FBLG RESEARCH REPORT
Business Update
On June 25, 2024, FibroBiologics, Inc. (NASDAQ:FBLG) announced positive proof-of-concept data regarding the development of a novel fibroblast-based artificial thymus organoid that can restore immune function in a severe combined immunodeficiency (SCID) mouse model, including the ability of the thymus organoid to aid in T cell maturation.
The in vitro data showed that the thymus organoid allowed for the progression of a T cell progenitor cell (hematopoietic stem cell progenitor from the bone marrow) to an immature T cell that expresses a T cell receptor (TCR), a critical step in T cell development as the TCR is responsible for recognizing non-self targets. The in vivo data showed that when the thymus organoid was injected into a SCID mouse, it gave rise to fully mature T cells that express a TCR and differentiate into CD4 or CD8 T cells. In addition, the data indicate that the CD4 T cells can further develop into regulatory T cells (FOXP3+), which play a role in protecting against inflammation and autoimmune diseases. Lastly, the data show that the thymus organoid also gives rise to gamma-delta T cells.
Thymus regeneration is being pursued as a potential “extension of life” therapy. The thymus naturally declines in function as people age (thymic involution), and this results in enhanced regulatory T cell activity that can increase susceptibility to infections, tumors, and autoimmune diseases. By regenerating the thymus, it may be possible to extend human life by enhancing the immune activity that typically wanes through the aging process.
Financial Update
On August 7, 2024, FibroBiologics filed Form 10-Q with financial results for the second quarter of 2024. As expected, the company did not record any revenues for the second quarter of 2024. R&D expenses for the second quarter of 2024 were $1.0 million compared to $0.5 million for the second quarter of 2023. The increase was primarily due to increased personnel expenses, research materials and supplies, and tissue acquisition costs. G&A expenses for the second quarter of 2024 were $2.2 million compared to $1.5 million in the second quarter of 2023. The increase was primarily due to higher regulatory, legal, accounting, insurance, and personnel costs. The company reported a $5.5 million gain during the three months ending June 30, 2024 resulting from the mark to market of the company’s warrant liability, which will occur at the end of each reporting period as long as the warrants are outstanding and classified as a liability.
As of June 30, 2024, FibroBiologics had approximately $6.0 million in cash and cash equivalents. As of August 6, 2024, FibroBiologics had approximately 35.2 million shares outstanding and, when factoring in options and warrants, a fully diluted share count of 40.5 million.
Conclusion
We continue to anticipate that a Phase 1/2 clinical trial of CYWC628, the company’s lead asset targeting diabetic foot ulcers, will be completed in Australia in 2025. We also anticipate clinical trials initiating in 2025 for CybroCell™ as a treatment for degenerative disc disease and CYMS101 for the treatment of multiple sclerosis. For a full overview of the company please see our initiation report, which published in June 2024, and can be found here. With no changes to our model our valuation remains at $11 per share.
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