Lineage Cell Therapeutics at H.C. Wainwright: Strategic Insights on OpRegen

On Tuesday, 20 May 2025, Lineage Cell Therapeutics (NYSE:LCTX) presented at the H.C. Wainwright 3rd Annual BioConnect Investor Conference 2025. The company highlighted its strategic advancements, notably its promising OpRegen program for dry AMD, amidst both challenges and opportunities. The discussion underscored Lineage’s potential growth trajectory, bolstered by its partnership with Roche/Genentech.

Key Takeaways

• Lineage’s OpRegen program shows potential to restore retinal structure and function, surpassing existing treatments.
• A $50 million upfront payment from Roche, with potential for up to $620 million in milestones.
• The GALET study focuses on optimizing surgical techniques for cell delivery.
• Lineage’s manufacturing capabilities are a competitive advantage in the cell therapy market.
• The OPC1 program for spinal cord injuries shows promise with resumed clinical trials.

Financial Results

• Lineage received a $50 million upfront payment from Roche/Genentech.
• The partnership could yield up to $620 million in development and commercialization milestones.
• Lineage is set to earn double-digit royalties on sales, increasing with volume.
• An additional agreement covers manufacturing and supply services.

Operational Updates

• OpRegen is under Roche/Genentech’s clinical development, with Lineage handling current manufacturing.
• The GALET study (Phase 2a) aims to optimize surgical cell delivery techniques.
• Roche/Genentech has secured RMAT designation for OpRegen.
• Lineage has developed a GMP manufacturing system capable of producing millions of therapy vials.

Future Outlook

• A three-year data update for OpRegen is expected at the CTS conference on June 21st.
• OpRegen has the potential to be a single lifetime treatment for patients.
• The OPC1 program for spinal cord injury treatment is resuming clinical trials.
• Preclinical testing of auditory neurons for hearing loss treatment is underway.
• Lineage plans to leverage OpRegen’s success to expand into additional cell therapy opportunities.

Q&A Highlights

• The timing and content of GALET study data release are controlled by Roche/Genentech.
• Lineage’s manufacturing capabilities are highlighted as a competitive edge.
• Potential partnerships with companies facing challenges in cell therapy manufacturing were discussed.

For further details, readers are encouraged to refer to the full transcript below.

Full transcript - H.C. Wainwright 3rd Annual BioConnect Investor Conference 2025:

Joe Pangenis, Managing Director, HC Wainwright: Hey. Good afternoon, everybody. I’m gonna turn this on. Good afternoon, everybody. My name is Joe Pangenis, managing director here at HC Wainwright.

Welcome back to our next fireside chat. Very happy to have with us Brian Culley, chief executive officer of Lineage Cell Therapeutics. And, so thank you very much for being here. And little before this presentation, I thought of a little analogy. Think, feel like I’m in front of a senate senate panel, and I’ve prepared a statement before we get into our questions.

So honestly, I just wanna cut to the chase about one of your lead indications, lead assets too. Actually, it’s Roche’s asset now, OpRegen. You know, really think this is one of Lineage’s key differentiators in dry AMD with geographic atrophy or GA. Two drugs have been approved, and we all get inundated with the ads in the media and questions from investors regarding Isurvey and Cefovirate. They were approved in 2023, and the key takeaway here is they only slow the progression of geographic atrophy in the range of about fourteen to twenty percent.

I know that was a long winded intro, but I think it’s important perspective. So now let’s just dive into some, key thesis points. So, again, now enter OpRegen. Based on data that Lineage delivered, Roche came in and signed a global partnership based on only five patients’ worth of data based on you showing something essentially unheard of, namely the restoration of retinal structure, function, and visual acuity improvements. That’s pretty remarkable.

Can you give us a snapshot of these data, please, that include the two year follow-up for these patients, number one? And for number two, next month, Roche is expected to update your study with a three year follow-up. What should we expect to see in here?

Brian Culley, Chief Executive Officer, Lineage Cell Therapeutics: Thank you for the opportunity to talk about, talk about the lead program in particular. Just a quick reminder, Lineage Public Company, please refer to the risks of investing, through our filings at sec.gov. So a key term in there, Joe, I I think was, unheard of. Right? Great claims require great evidence to to back them up.

I would I would maybe make one correction. I think the Roche and Genentech transaction license agreement that we entered into, was heavily informed by five patients in particular. The totality of that data was a 24 patient trial but those five patients that you mentioned and I’m glad you called them out, they received our RPE cells right onto of atrophy. So this is this is a transplant. This is a cell transplant and what we were able to show with those five patients in particular were both anatomical and functional improvements in the setting of dry AMD with GA and heretofore

Those approved agents that you referenced they do not improve function. I think it’s been demonstrated very clearly that they do not have a functional benefit merely a approximately 20% reduction in growth of the area of atrophy of the lesion in the back of the eye. So we come in with our lead program transferring these RPE cells and we were able to not only increase the layers, the key retinal layers, so the internal limiting membrane, the ELM, the RPE layer, but also increase patient vision. And that’s unheard of. That’s the right way of describing it, it’s unheard of.

The two year data that was presented on this, which is relevant because this is a degenerative condition where patients only get worse. So looking over a two year time frame is really insightful because we know that patients that are not treated will lose seven, eight, nine letters of vision over that time frame. And in fact even patients on the best available therapy are going to lose seven, eight, nine letters over that time frame. Those patients that you mentioned, they had gained seven letters in that same time frame. And that is really significant because human beings do not have regenerative capability of their retina.

So you should have, and you can go and find in the literature everywhere the word irreversible is used. It’s an irreversible condition, but perhaps for the handful of patients that have been treated with our therapy where we’ve been able to actually increase the vision for a durable and very clinically relevant time frame.

Joe Pangenis, Managing Director, HC Wainwright: Excellent. And then, with the upcoming three year data that’s expected next month, and again, this is in Roche’s hands now, what do you expect that they’ll show us?

Brian Culley, Chief Executive Officer, Lineage Cell Therapeutics: Well, I’ve seen what I think is is likely to to come from that data. What I can say is these effects have persisted, I mean, without any any detail. And if you can already be moved by seeing an increase in vision at year one compared to untreated, and then that delta at year two gets larger because untreated patients are continuing to lose lose sight, they’re going blind. If you go out for a third year you would expect at least that comparator, that untreated patient, is going to get worse. It remains to be seen in some detail exactly what happens with our patients, but the benefits have persisted.

So I think it’s safe and comfortable to say that it’s not a two year therapy. It looks like it’s going you know potentially lifetime. This potentially could be single treatment that lasts for the patient’s life and durably preserves their vision and that’s that’s just something that appears to be on a trajectory of becoming more and more clear and convincing with every passing assessment that’s performed because again we know that an untreated patient is only going to get worse. So it’s really exciting now that the details coming forthcoming at the CTS conference on June 21 And to be really clear about this, although Lineage collected the raw data, the analysis that will be presented, that’s not done by by Lineage. That that’s been done by Genentech.

They’ve got proprietary algorithms and and, you know, their conclusions that they’re drawing, and they they have a a speaker who presents that on their behalf. You know, that’s really independent. Even their quality control of the data, that’s that’s done independently from us. So it really is, you know, our their interpretation of our raw data, and I think their interpretation is that there’s there’s something very special happening here.

Joe Pangenis, Managing Director, HC Wainwright: Good to know and look forward to seeing the update. And, I I just feel it’s necessary to repeat again, you know, with the approved drugs, vision continues to get worse, albeit potentially slower, and you are reversing it at least through the two year data, which is unheard of. And, again, that’s what attracted Roche, Genentech. And, with that said, before we talk about more about what they’re doing, before what they’re doing clinically, I should say, since the OpRegen program is 100% in their hands, they signed a global partnership with you around these limited numbers of patients. Can you discuss some of the terms around that partnership?

And it actually has a couple layers to it.

Brian Culley, Chief Executive Officer, Lineage Cell Therapeutics: Yeah. Does. In in many ways, it’s a conventional looking deal even though it’s an unconventional approach or an unconventional asset. So we’re we’re very proud of the economics because, you know, cell therapies haven’t always attracted the highest and best terms But we received a $50,000,000 upfront payment, $5.00 upfront payment.

We’re eligible for an additional $620,000,000 of developmental and commercialization milestones and then additionally double digit royalties that increase as certain sales thresholds are hit. So that deal was signed a few years ago. It looks like a cancer therapy deal, but yet it’s an ophthalmology deal with a radical new approach. I wish I could do that deal today, Right? I’d I’d want 10 times that money up front, but I also have the benefit of of a lot more evidence to to support this approach.

So, you know, I applaud Roche and Genentech for for having the courage to to to take a new a new way of of treating this disease that that almost surely will, be shown to be superior to what what’s currently available. But, you know, there’s certainly a lot of economics that are reverting to to lineage through this through this arrangement as well.

Joe Pangenis, Managing Director, HC Wainwright: And I know with another layer, there was some manufacturing or supply agreement added to added to it as well.

Brian Culley, Chief Executive Officer, Lineage Cell Therapeutics: Yeah. It’s really nice. You know, we without without touching the original agreement, we entered into an additional agreement around some certain services. So so they expanded the agreement. And that really has been, you know, one of the things that I’ve been helping investors kind of recognize is that in the first year or so of this alliance, there there wasn’t a lot of public information available, but there’s been an acceleration.

So we have this additional agreement that happened in the second year, additional clinical sites were opened in the second year, Genentech went, sought and obtained RMAT designation for the asset in the second year. The reason why I emphasize that is this is an open label study with, you know, clinical benefits that are hard to miss. So if you have on a on a control arm or an untreated arm, you’re going to have no events where people spontaneously regrow retinal tissue or regain vision. So when you see that occurring it’s hard to miss, right? It’s a very obvious effect.

And so when you think about an open label study, although we do not have access to this data, certainly not on this granular level, our belief system is that good things are happening, our partners are seeing those good things, and they’re increasing their investment, including with respect to the ongoing study that they’re they’re conducting today.

Joe Pangenis, Managing Director, HC Wainwright: Got it. No. Thanks for that. And then my next question really has two parts, and I wanna ask them very specifically if you can address them just, you know, each independently. So now that OpRegen is fully in Roche’s hands, can you first describe the clinical program that they’re conducting on their own, which I know also has to do with, assessing various delivery techniques?

Brian Culley, Chief Executive Officer, Lineage Cell Therapeutics: Yeah. So I I would just say that with respect to clinical development, completely in in their hands. Right? We’re not we’re not meaningfully involved in that. But we are still today the manufacturer of the product.

So we are we are tech transferring that process. Normal deals, you think of like a small molecule that has a structure, maybe a straightforward synthesis. You hand it over to your partner, and you might never hear from them again. But we’re very actively involved in the process because we are the manufacturer of a complex biologic, but we do not expect to continue to be that that manufacturer. We are tech transferring it, which is an important skill because we want to have additional transactions of this kind in in other areas of our business.

But with respect to the ongoing study, this is called the GALET study, this is a phase 2a clinical trial that Genentech is managing and they call it a surgical optimization study. So one of the things that we showed was that if you place the cells right onto the area of atrophy, you get the best possible clinical outcomes. And in fact, if you place the cells away from the area of atrophy, you really didn’t see very much. So there might not be much of a trophic effect, this really might be a transplant effect. And it’s very important because it means you want to go through the step of figuring out what’s the best way to place these cells into a very delicate area of the retina called the subretinal space.

So they are exploring various methods, tools to deliver our material to the sub retinal space because it must get there in order to get the best possible effects. And when you go through that process of improving how you deliver, if you are simultaneously reducing the AE profile and you’re having higher percentages of delivery, you know, you’re if you’re landing the helicopter in the circle where it’s supposed to be more and more frequently you’re getting better outcomes and you are separating creating separation between the benefit and the risk of a therapy, which ultimately is FDA’s, you know, process of evaluating whether the benefits of a therapy are worth the risks. So what I really like about this in particular is typically in a phase two trial you’re asking questions around efficacy. Does my intervention work? In this case we, I think, have a belief system that it works, we could demonstrate that, but the question becomes how can you make it better?

So this is more of an engineering question, this is more of a delivery question, it’s a procedural question and I believe that the probability of success that you can improve a therapy through those arms rather than trying to squeeze out efficacy of a molecule but through dosing or something like that, I’m much more comfortable with the kind of work that they’re doing right now from a risk perspective because I I think about things like LASIK surgery. It used to be kind of crude, you know, scalpel, and and over time it got better and better. So that’s the that’s the arc of new technology. Right? This is a new approach, and I think it’s gonna get better and better and easier for surgeons to employ it.

And that’s going to lead to better outcomes and make it a more valuable asset.

Joe Pangenis, Managing Director, HC Wainwright: Oh fantastic. Okay so part two and I think I would put this as the main driver of your investment case in my belief and one of the main reasons we have a buy rating on your stock. And that is when are we going to see data from Gillette? Now since it’s in Roche’s hands, you don’t have any control over that with regard to data release. And I think it’s not necessarily a black and white answer because, you know, we’re saying, oh, we’re expecting Roche to present data at Arvo or, you know, when present data anywhere.

So I guess, how do we view the progress of Roche? Will we see data? What are the components might impact about the program moving forward that could impact the investment case?

Brian Culley, Chief Executive Officer, Lineage Cell Therapeutics: Yeah. It’s it’s it is correct that, we don’t know exactly what that looks like, and we don’t know exactly when that occurs. So there’s a tarot card exercise. Right? So, you know, even simple little things like naming the study.

Right? Like, you know, you imagine it having a podium presentation at some point, but but we don’t know. What we our view of that is while there are indicators that suggest to us that things are going well and we’re comforted, we feel some asymmetry in a possible positive outcome from the ongoing work. Ultimately, if the work that’s being done by our partners is increasing the probability of success and the value of the asset, we’re less worried about the timing of it. So do I do I want news to break tomorrow?

Everyone does, of course. Right? I I I don’t control it. I don’t know when. I don’t know when I’m going to know.

But if the work that’s being done that now is creating a more valuable lead asset for us, it’s okay. We can wait. We’ll get there. It’s not like it’s not like a revenue generating pharma company is going to run out of money to conduct their trial. Right?

That’s a small company problem. So, you know, we’re confident that we’ve picked the right leader, you know, one of the best ophthalmology global pharmas you could ever conceive of. They’ve made billions of dollars in in ophthalmological products. I’m pretty sure that they know exactly what they’re doing. So, you know, we just we do be patient and confident, and we’ll see what, what we’re able to say at some point in the future.

Joe Pangenis, Managing Director, HC Wainwright: So I look at multiple components there, and I would also add the addendum that I guess, you know, part of the street’s proverbial impatience around seeing data is that the Gallette study has been ongoing for quite some time. So I think that’s what adding to the excitement and the impatience. And then, you know, from a big pharma standpoint, you don’t necessarily see, I’ll put in quotes, earlier stage data. You know, they keep it close to their chest or what have you. Are there other avenues that might show that the study or the asset is progressing?

Brian Culley, Chief Executive Officer, Lineage Cell Therapeutics: Well, I think I think Roche and others of that ilk, tend to be somewhat conservative in their data sharing, especially for earlier stage pipeline programs. It doesn’t move their stock. Right? Many billion dollar company. It’s tremendously important to our little company, and so we are encouraged by and thankful for our partner doing things like for analyzing and presenting our long term phase one data.

I mean, honestly, they don’t have to put the work in to do that. So I I now is it correct of me and others to interpret that that there’s a positive signal there that they they want people to know about what’s but, you know, maybe. But, you know, the truth of the matter is we don’t know. But we look at things like, for example, Roche had a, you know, new leadership. They went through a rationalization of their pipeline and they eliminated, and I see different numbers, 25, 30 percent of their pipeline.

They got rid of things that just weren’t working for them anymore and in their language focused on best in class first in class opportunities transformative medicines. I really feel like we fit pretty solidly inside of a box called transformative medicines. So I’m encouraged that they have an open label study they’ve had plenty of opportunities to kill this program. So if that’s the bare thesis that it’s not working, like I don’t think there’s very much evidence to support that. But again I want to be abundantly clear.

I haven’t seen the data from the ongoing study from the Gillette study. I don’t know even how many patients have been enrolled. We don’t have full visibility into that, and and that’s okay because we want it to be done correctly. We want it to be well done well. And when we get there, you know, there will be a moment, and hopefully it’ll be a very happy moment.

Joe Pangenis, Managing Director, HC Wainwright: Great. Again, looking forward to it. We’re all getting impatient. Wanna see something now because we think it’s gonna be, very nice, at least in our belief. So little bit changing gears here on the periphery.

You’ve made some comments recently. We’ve looked at them as well. The competitive environment that you might feel is validating to your RPE or cellular approach from others.

Brian Culley, Chief Executive Officer, Lineage Cell Therapeutics: Yeah. This was this was tremendously important to us. So there are a couple of companies that also manufacture RPE cells and administered them to the same location. They probably learned from us how to do this, right, because we were pretty open about it. And they reported some great results.

So they’ve reported that people with dry AMD with GA, so advanced atrophic AMD, have increased vision over very reasonable time frame six months, twelve months. So that is tremendously validating independent corroborating evidence, right, independent companies with their RPE cells in the same kind of patient getting these extraordinary outcomes. Now I don’t happen respectfully because I think there’s some great science being done I don’t happen to consider those companies to represent very meaningful competitive threats because Lineage has outstanding manufacturing capabilities, Genentech has outstanding clinical development capabilities, Roche has outstanding commercialization capabilities. They don’t have that. But I do think it’s really important for those who say, well, Lineage only had 24 patients and then only five of those were the specials that got the cells in the right place.

You can now look at other companies that have done this and you can add those and like almost a meta analysis start to answer questions about whether or not this mechanism works. I I think it provides tremendous independent proof that the mechanism works without reflecting risk that those entities will meaningfully compete for market share at some point in the future.

Joe Pangenis, Managing Director, HC Wainwright: Got it. Gonna move over to, you know, one of the key topics that I think is, not really paid attention to that much, and that is your overall manufacturing capabilities. So if you look at the time continuum, having been one of the early analysts that covered Geron, a lot of this technology came from Geron and these embryonic cells that have been differentiate differentiated into specific cell types. It’s essentially night and day now with regard to how they’ve evolved to where you are now. So can you talk about some of your major successes recently for manufacturing of different cell types, as well as how that might even, again I want to throw it out there, being a separate commercial model on the manufacturing front?

Brian Culley, Chief Executive Officer, Lineage Cell Therapeutics: Yeah. I mean, I I was probably in grad school when the first era of cell transplants was was sort of you know coming around and and you know the tools and techniques were not very advanced. But the the vision here, the dream if you will, is that a pluripotent cell line whether ES or IPS doesn’t matter, but a a self renewing cell line meaning you’ve got an abundant and never ending supply of starting material which can then go through a directed differentiation process into a specific cell type that’s your medicine. Being able to control that process, the scale, the purity, the potency, all the criteria that are necessary not only to have to receive marketing authorization but also be able to satisfy the addressable patient population affordably, right, because you’re not going to charge $500,000 for, you know, an 87 year old woman to get, you know, cells in the back of her eye. So you have to be able to fit these pieces together.

The only way you can do that is through allogeneic cell transplants similar to what we’re doing. But it has been very difficult for the field to be able to manufacture on a platform that can demonstrably show that it’s capable of this kind of cost of goods. Right? Affordability, the accessibility, off the shelf use. Right?

Nobody wants hours of manipulation, growing cells on feeder cells, on flat plates. Right? Like, there are technologies now, and we recently announced, and I think this is what you’re you’re aiming at, that we had reduced the practice on two separate occasions. A GMP manufacturing system where we’re able to make the the master cell bank, which itself can generate any of those vials can generate a working cell bank, and any of those vials can generate the product. And when you when you do that process, your process is is the same every time, which means you get to multiply bank one times bank two times your production.

So we have reduced to practice a capability of manufacturing millions of vials of therapy, each which would contain millions of cells, and to be able to do so in with multiple cell lines so it’s not unique to the cell line, but multiple cell lines, and making multiple cell types. So we have in doing this two things. We have one, not noticed that anyone else has been able to do this, so we think it’s special. And two, this opens up a whole new opportunity to partner and to collaborate with others who are struggling with this. You know, if you’re taking a bag of blood and you’re going and you’re harvesting T cells and expanding them and editing and by the way editing reduces your yield you know that’s a custom therapy.

It goes back into the patient. It’s extremely expensive to do that. But if you have frozen away thousands or tens of thousands or hundreds of thousands of vials of material and it’s off the shelf use and it’s stable, that is the vision for allogeneic cell therapy. And, you know, I think we’ve made an important step toward realizing that vision.

Joe Pangenis, Managing Director, HC Wainwright: Look forward to seeing a lot more with that. And, I mean, we’re out of time. However, I would be remiss. I mean, we could still spend another hour literally talking about OpRegen, but, you know, you’ve had a long standing program that’s about to hit the clinic again after seeing some encouraging data, that’s the OPC one program. Can you give me an elevator pitch around OPC one?

Brian Culley, Chief Executive Officer, Lineage Cell Therapeutics: Yeah. Yeah. So building upon the the success of OpRegen and and what we’ve been able to do there, you know, controlling our material and validating that cell transplantation can be safe and reproducible and drive extraordinary clinical outcomes. We want to go far beyond just dry AMD with GA. We want to go into other areas.

So yes, manufacturing oligodendrocyte progenitor cells to treat spinal cord injury to help people regain their functional abilities after a traumatic injury. We’re looking at auditory neurons now we have that in preclinical testing and we’ve got you know some really interesting kind of behind the curtain. You know it’s inexpensive to just think and talk about it and I think that’s really the future of this company is using the success of the lead program, the partnership, the validation and hopefully that also is going to bring a better cost of capital and then be able to reinvest and repeat that success. And I’m really excited about having a whole basket of opportunities, different kinds of partnerships, different internal ownership. That’s what a platform can do for you.

Joe Pangenis, Managing Director, HC Wainwright: Great. Appreciate the discussion, Brian.

Brian Culley, Chief Executive Officer, Lineage Cell Therapeutics: My pleasure, Drew. Thank

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