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LGVN: Using Cellular Technology to Ease Major Medical Issues

By Brad Sorensen, CFA

NASDAQ:LGVN

READ THE FULL LGVN RESEARCH REPORT

Longeveron (NASDAQ:LGVN) is a Miami-based, clinical-stage biotechnology company focused on developing cellular therapies for chronic diseases associated with aging and other life-threatening conditions. Management at Longeveron believes that by using the same cells that promote tissue repair, organ maintenance and immune system function, the company can develop safe and effective therapies for some of the most difficult disorders associated with the aging process.

Longeveron’s lead investigational candidate is a cellular therapy known as Lomecel-B, which is being evaluated in multiple clinical trials and life-threatening conditions under United States FDA-approved Investigational New Drug (IND) Applications. Although Longeveron’s main focus is on age-related maladies, breakthroughs can be found through the research process in other areas as well.

Lomecel-B is made from living cells called Medicinal Signaling Cells (MSCs) that are isolated from fresh bone marrow tissue donated by adult donors, alleviating some of the ethical concerns that can surround some forms of cell research and their sources. Once these MSCs are isolated, the cells are culture expanded (allowed to replicate under controlled laboratory conditions) into billions of living cells. After a specific number of expansion cycles, the cells are harvested and separated into specific doses. This method of harvesting and replicating cells has several inherent advantages, including:

- Cells harvested from living human donors have characteristics that allow them to be transplanted from donor to host without triggering a harmful immune response.

- Therapies using these cells can be administered on an out-patient basis in as little as 40 minutes after thawing.

- This has an advantage over a patient using their own cells and then reintroducing them back into the same person—which can take weeks or months and can only be used on one patient.

- Therapies using these cells are considered an “off-the-shelf” product, which means they are stored frozen and available for on-demand use.

- Data from clinical studies suggest a single dose may last over 6 months.

- The source for the starting raw material is young healthy donors.

In 2021, Lomecel-B was granted Rare Pediatric Disease (RPD) and Orphan Drug Designation (ODD) by the FDA for the treatment of Hypoplastic Left Heart Syndrome (HLHS), which is a rare and life-threatening defect in infants. The designation for the treatment of HLHS was the biggest development recently but research and trials for Lomecel-B are ongoing for such conditions as: Alzheimer’s, Aging Frailty, Metabolic Syndrome and Acute Respiratory Distress Syndrome (ARDS).

Longeveron has no revenue from sales of products at this point in time and we project it will be several more years before commercialization of therapies currently under development comes to fruition. But, unlike many companies at this stage of development, Longeveron is not strapped for cash as this point. Due to the nature of their research, rare, tough to solve conditions, the company has been able to fund operations with grants from various governmental and non-profit organizations. Since inception through September 30, 2021, Longeveron has received approximately $11.9 million in government and non-profit association grants. This method of funding increases the attractiveness of LGVN in our minds as there is likely to be less dilution for shareholders due the company not needing to go to the equity markets to continue to do business.

Although there are several steps Longeveron needs to take before meaningful revenue will start coming in, we believe the company is a good investment opportunity for investors who are willing to ride some inevitable volatility and have a relatively high risk tolerance.

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