Lineage Cell Therapeutics, Inc.

Welcome to the Lineage Cell Therapeutics 3rd Quarter 2025 Conference Call. At this time, all participants are in a listen-only mode. An audio webcast of this call is available on the Investor section of Lineage's website at www.lineagesell.com. This call is subject to copyright and is the property of Lineage. And the recordings, reproductions, or transmissions of this call without the express written consent of Lineage are strictly prohibited. As a reminder, today's call is being recorded. I would now like to introduce your host for today's call, Iona Hohn, Head of Investor Relations at Lineage. Ms. Hohn, please go ahead.

Thank you, Angela. Good afternoon, and thank you for joining us. A press release reporting our third quarter 2025 financial results was issued earlier today, November 6, 2025, and can be found on the Investors section of our website. Please note that today's remarks and responses to your questions reflect management's views as of today only and will contain forward-looking statements within the meaning of federal securities laws. Statements made during this discussion that are not statements of historical fact should be considered forward-looking statements. which are subject to significant risks and uncertainties. The company's actual results or performance may differ materially from the expectations indicated by such forward-looking statements. For a discussion of certain factors that could cause the company's results or performance to differ, we refer you to the forward-looking statement sections in today's press release and in the company's SEC filings, including its most recent annual report on Form 10-K and in subsequent SEC filings. We caution you not to place undue reliance on any forward-looking statements, which speak only as of today and are qualified by the cautionary statements and risk factors described in our SEC filings. With us today are Brian Culley, our Chief Executive Officer, and Jill Howe, our Chief Financial Officer. I'll now hand the call over to Brian.

Thank you, Ioana, and good afternoon, everyone. We appreciate you taking the time to join us on the call today. I'll begin with an update on our lead program, OPPERGEN, then review our progress against the five strategic goals which I outlined for you last quarter. In addition, I'll provide some insights on our pipeline strategy before concluding with some information on our islet cell project. Then I'll hand the call to Jill for a review of our financials before taking questions from our analysts. I want to begin with an update on OPPERGEN because there have been some very exciting advancements in the ongoing Phase 2A GLEP study. We're pleased to update you that Genentech is continuing to expand the retinal community's exposure and experience with Oprigen. In particular, Genentech opened two new clinical sites last month, and five new clinical sites were opened during the prior quarter. Overall, eight clinical sites have been opened in just the past six months, bringing us to a total of 15 unique locations. Genentech opened only one new site in all of 2024, so we take this site expansion to be a positive sign. As a reminder, we don't have full visibility into the Gallet Study enrollment or its findings, but the study has been running for more than two years, and it is an open-label trial for which all primary and secondary outcome measures are captured at 90 days. Given that there has been abundant time for Genentech to collect outcomes data in year one, and they more than doubled the number of sites in year two, we interpret this acceleration of their clinical efforts to be a positive signal for the future of this program. The rising number of clinical sites is, of course, just one element contributing to our belief that things are going well for Oprogen. There is a growing body of additional publicly available information, which in the aggregate provides further evidence that Oprigen could be advanced into a controlled clinical trial, possibly in parallel with continued efforts at surgical optimization of this new technology. For example, since the GLETT study began, Genentech reported its own 24- and 36-month analyses from the Lineage Phase 1-2A trial. That data showed that, as a group, Patients who received a one-time dose of Oprogen RPE cells across large areas of their GA enjoyed improvements in retinal structure, consistent and durable increases in visual acuity, and an acceptable safety profile. These are remarkable clinical findings because patients with GA don't self-heal. And earlier this year, these outcomes were independently validated by similar reports coming from three other groups, each using their own version of an RPE suspension. One of those competing entities is a multinational pharmaceutical company, which we believe further supports the commercial potential of our cell transplant approach. As a further reminder, about a year ago, Roche was streamlining its pipeline and eliminated a set of development programs to focus on those with, quote, best-in-class potential. Some investors had asked about how these pipeline cuts could affect the OPERGEN program, but OPERGEN was not affected. And a few months later, we actually entered into an additional and expanded services agreement with Genentech to further support OPERGEN development. Around the same time, Roche elected to seek and successfully received RMAT designation for OPERGEN. And more recently, Genentech shared that they would be evaluating two next-generation delivery devices, acquired specifically for the OPERGEN program and which have the potential to not only improve the safety and success of the cell transplant procedure, but may also offer a significant competitive advantage over companies that lack both this specialized equipment and the extensive delivery experience of our partner, Roche. When you aggregate all of these publicly available actions, and I did not list all of them today, But I hope you will appreciate why we are bullish on the future of Oprogen to treat GA patients and why we are taking steps to try to repeat the success with other cell types. So given what appears to be a steadily growing list of asymmetrically positive indicators for the successful advancement of Oprogen into a controlled clinical trial, and while still noting the ultimate decision to advance the program is solely with our partners, Roche and Genentech, we have increasingly been thinking about how we can create value from the clinical, technical, and financial success that we're anticipating from Oprogen. With that in mind, I will turn next to some statements I made on our prior quarterly call to get a scorecard on how we've been doing. Last quarter, I outlined five areas of focus through the end of this year, and I'm pleased to report that we have already successfully delivered on several of those strategic initiatives, and we still have nearly two months to go. Our first goal was to enter into deals which partly or completely fund existing product candidates. We accomplished this goal through the partnership we announced with William DeMont Investor, WDI, which is expected to fund up to $12 million in research and collaboration costs for all planned preclinical development of Resonance, our first internally developed cell transplant program for the treatment of hearing loss. Resonance was an important test for our business model because it showed that we could conceive of and successfully manufacture a new cell-based product candidate, generate new intellectual property, and advance it into initial preclinical testing in approximately one year and with a modest initial investment. And soon thereafter, we signed a collaboration agreement with WDI, which is a world-leading hearing healthcare company, securing external funding, leading to an IND or CTA if the data supports it, and also provides access to technology expertise and a network of hearing health leaders. We and WDI also have preserved the right to enter into a future clinical and or commercial deal with a pharma partner, if such an opportunity does arise. I believe this collaboration was an important demonstration of the speed, efficiency, and return on investment that the lineage platform can provide and provides evidence to support our strategy of replicating our OPERGEN success with other cell transplant programs. In addition to funding existing assets, our second goal was creating new assets which could attract external funding or collaborations. And while we have not yet said anything publicly about what we're doing in this category, I can share this year we conducted initial wet lab work on multiple target cell types. And if that work continues to go well, our expectation is that we would then disclose our next intended indication before our next quarterly call. Our third goal was to capitalize on our unique manufacturing capability, which we believe could solve issues which impede others' programs from success. Our new initiative in islet cell production is an example of how we're trying to meet this goal. we're looking to tackle the major limitations in production scale, which must be solved in order to have a commercially viable cell therapy product for type 1 diabetes. If we are successful with this initiative, our innovations could be applicable to other programs, potentially opening the door to conditions previously thought to be too big and too expensive to address with cell therapy. At-scale affordability is in fact the entire point of allogeneic off-the-shelf product development. So achieving this goal would mark a crucial moment for the field. Our fourth goal was to obtain a CIRM Clin2 grant, which we applied for earlier this year. CIRM has employed a new review process, and our understanding of that process is that only seven applications were advanced out of an initial larger pool of candidates. We were among those seven finalists, Since that selection to the final seven, we have answered a series of questions from the grants working group, but we have not received a grant score or any indication of whether we ultimately will receive a grant or not. However, we believe the finalists will be voted on at the next CIRM ICOC meeting on December 11th. Therefore, assuming CIRM maintains its planned timing and we have interpreted their plans correctly, we should know our status toward meeting our fourth goal in about four or five weeks. And by the way, if we do receive CIRM funding, it would provide a very nice non-dilutive offset of up to approximately $7 million from the ongoing dose study of OPC1 for spinal cord injury. The last of the five goals I outlined for the quarter was to complete activities leading to milestone revenues from our partnership with Roche and Genentech. As you already know, I cannot speak to our milestones or their amounts until such time as they are met. But it remains an important activity, it is a top priority, and I am pleased with our progress related to this effort. As a final point, most of the goals we have focused on are tied in some way to an expansion of our business. For example, expanding the scope of the OPC-1 study by a CIRM grant, or expanding the output of new assets from our in-house manufacturing platform. These are intentional moves by us because they reflect the convergence of three key factors. One, the reduction to practice of our high-scale GMP banking system, which we announced a few months ago. Two, the emergence of a more favorable biotech market, which has improved the cost of capital from which we can fund judicious and stepwise expansion. And three, the belief that the OPERGEN program will continue to advance under our Roche Genentech Alliance and provide us with the credibility, confidence, and capital to take our platform further than where it is today. We have been eagerly awaiting a time when this accumulation of factors would align and permit us to elevate Lineage's growth trajectory. We believe this momentum began in the second half of this year and expect it to continue during 2026. I should add at this point that while we aim in time to create a basket of cell therapy assets, some of which we might choose to develop internally and some of which we might partner, I have been asked on occasion how we, as a small company which has long demonstrated such fiscal discipline, how would we manage a larger portfolio? The answer is clear. Our core technology, our platform, generates assets which share essential traits in common. Those traits occur early enough in a project that they're not dependent on us having a huge body of disease-specific expertise. Our technology is based foremost on the directed differentiation of pluripotent cells into discrete and scalable cell types of the human body. And while each product candidate is of course intended for a different condition, and each cell line behaves in a unique manner, the early and necessary steps of process development, control, scale, and purity are largely common features in the way we apply them, which allows us to expand the scope of our pipeline without losing the focus necessary to succeed or without requiring an excessive amount of capital investment. And by adapting or initiating each program on the same process development modality, we are generating more shots on goal per dollar invested. So with platform expansion as a convenient transition point, I'll turn lastly to an explanation of our recently revealed islet cell initiative. The human body is comprised of about 200 discrete cell types, and because pluripotent cells can become any of those 200 cell types, we have many choices about where to deploy our resources into new product candidates. When we were nearly 100% focused on OPRGEN, this selection process was largely running in the background. Our initial pilot effort from this strategy was our program in auditory neurons because we knew auditory neurons represented a high-quality opportunity, and based on our recent collaboration with WDI, that has proven to be true. But there are many other cell types we could tackle, and as OPRGEN's future brightened, we have increasingly emphasized and acted on our plans to repeat our Oprygen success. To that end, we hired a former venture capitalist who built for us a proprietary opportunity tracker. The basic idea for that tracker is that you matrix each of your product opportunities against dozens of product characteristics, such as the addressable market, the quality of translational models, and many other aspects, including, of course, our proprietary manufacturing insights. And from the thousands of data points which are generated, we can identify our best potential returns on investments. One of the top outputs from this proprietary process was the opportunity for us to enter the type 1 diabetes space. Our work identified three main obstacles preventing cell transplantation from providing a commercially feasible functional cure for type 1 diabetes patients. The first of these was the mechanism, but multiple companies have since shown that indeed an islet cell transplant can achieve insulin independence for patients. The second obstacle is the need for lifetime immunosuppression, which is not a commercially feasible solution for the vast majority of patients. Several attempts to eliminate the need for immunosuppression have been explored, such as capsules or droplets, but we find the recent evidence from genetically edited hypoimmune cells to be the most attractive approach, one which has created a line of sight on breaching that second obstacle. That leaves only the third major hurdle, which is production scale. Cadavers are not a sustainable or stable source of islet cells, but pluripotent cells are self-renewing, so they can solve those deficiencies. However, while a single pluripotent cell can give rise to thousands of RPE cells in our system, you can only get a dozen or so islet cells from each pluripotent cell that you start with. And because the anticipated dose levels are as high as a billion cells per patient, you're not really a commercially viable product until and unless you can overcome the biological ceiling imposed by the generally accepted differentiation processes that exist today. I obviously cannot go into detail for competitive reasons, but the gist of the matter is that we have conducted some early work that suggests we may be able to increase our already large-scale production process by many thousand-fold. If we are successful, this could increase our relevance in the race to develop a functional cure for type 1 diabetes. Our initial goal for this program is to demonstrate our capability with one of our proprietary and best-behaving cell lines. This initial work is ongoing and intended to lead to a go-no-go decision on further development, which we will expect to occur next quarter. If the initial work with an internal cell line is successful, we believe it could accelerate partnership conversations for this program. And in parallel with any such talks, we would also seek to demonstrate system compatibility with a hypoimmune cell line, either internally or externally sourced, which would be a more suitable line from which to support a clinical campaign. And depending of course on the results and feedback we collect along the way, We may elect to do this work for a partner or retain the product internally for a longer period. So to summarize, we believe we can reach an initial feasibility decision on this T1D initiative with a modest investment and just a few more months of work. And even if our overall goal isn't met, we might still discover some things which we can apply to improve the efficiency of our existing programs. So with that, I'll turn things over to Jill for a review of our financials.