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InVivo Therapeutics Reports 2018 First Quarter Financial Results

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Progress Update on INSPIRE 2.0 Trial, Finance Officer Appointment

InVivo Therapeutics Holdings Corp. (NVIV) today provided a
business and clinical update and reported financial results for the
quarter ended March 31, 2018.

Richard Toselli, M.D., President and Chief Executive Officer of InVivo,
commented, "InVivo gained significant momentum in the first quarter of
2018, and we look forward to building on our positive momentum
throughout the rest of the year. We remain focused on the development of
our Neuro-Spinal Scaffold™ and continue to take steps to reduce
our expenses and maximize shareholder value. Key spend reductions have
involved the elimination of certain headcount and the assignment of the
company's lease, which is expected to result in lease-related savings of
approximately $3M through 2019. In addition to the lease assignment,
InVivo is undertaking other key cost-control initiatives, resulting in a
projected average cash burn of approximately $1M per month over the last
three quarters of 2018. Going forward, we continue to explore financing
options and are looking forward to our upcoming shareholder meeting."

InVivo's clinical team has begun preparation for the second INSPIRE
trial, INSPIRE 2.0. The Company has identified potential trial sites and
a CRO and manufactured clinical product to initiate the trial. Once
financing is secured, the INSPIRE 2.0 trial will begin enrolling
subjects. The company is seeking to secure enough financing to complete
the enrollment of the trial, which is estimated to be 18 months. The
company's financing strategy is dependent upon shareholder approval at
the 2018 Annual Meeting of Shareholders of an increase in the number of
authorized shares and an increase in the number of shares the company is
authorized to sell to Lincoln Park Capital.

The Company also announced the appointment of Jeff Modestino as
principal financial officer and principal accounting officer, effective
May 11, 2018, and the resignation of Christopher McNulty as Chief
Financial Officer. Mr. Modestino previously served as Chief Financial
Officer of Clearline MD and brings to the company over two decades of
significant healthcare and finance experience, including experiences
spanning medical devices. Dr. Toselli stated, "Jeff brings valuable
experience and has developed a strong understanding of the company,
having served as a consultant for InVivo prior to his joining full-time.
I would also like to thank Chris for his contributions to InVivo over
the past four years, and wish him the best in his future endeavors."

Recent Corporate Developments

  • Announced the appointment of Richard Toselli, M.D., as President and
    Chief Executive Officer of InVivo. Dr. Toselli, a Board-certified
    neurosurgeon, has led an accomplished career in surgical medical
    affairs, with senior leadership experience at Sanofi, DePuy, and
    Johnson & Johnson.
  • Entered into a common stock purchase agreement with Lincoln Park
    Capital Fund, LLC, a Chicago-based institutional investor, under which
    the Company has the right to sell up to $15 million in shares of
    common stock to Lincoln Park over a twenty-four-month period, subject
    to certain limitations and conditions set forth in the purchase
    agreement and registration rights agreement.
  • Received supplemental Investigational Device Exemption (IDE) approval
    from the FDA for a second pivotal clinical study of the Neuro-Spinal
    Scaffold
    ™ in patients with acute spinal cord injury (SCI). The
    20-patient (10 subjects in each study arm), randomized, controlled
    trial is designed to enhance the existing clinical evidence for the Neuro-Spinal
    Scaffold
    ™ from the company's single-arm INSPIRE study.
  • Presented CONTEMPO data at the 2018 Spine Summit medical meeting. The
    CONTEMPO data were designed to provide comprehensive natural history
    benchmarks for Neuro-Spinal Scaffold™ clinical study results.
    The CONTEMPO study included neurological recovery data from 170
    patients across three registries of SCI patients with similar baseline
    characteristics to those in the INSPIRE study and validated the
    company's previously established OPC with AIS conversion rates at
    approximately six months post-injury of 16.7% - 23.4% across the three
    registries.

Financial Results

For the three-month period ended March 31, 2018, the Company reported a
net loss of approximately $4.8 million, or $3.34 per diluted share,
compared to a net loss of $6.4 million, or $4.98 per diluted share, for
the three-month period ended March 31, 2017. The results for the
three-month period ended March 31, 2018 were favorably impacted by
decreases in operating expenses of $1,986,000 in research and
development offset by an increase of $149,000 in general and
administrative. The decrease in operating expense can be attributed to
the restructuring efforts that the company undertook in the third
quarter of 2017 and subsequent cost cutting initiatives designed to
reduce the company's monthly cash burn rate. The increase in general and
administrative costs is primarily attributable to severance related
expenses in the first quarter of 2018, as the company further reduced
its administrative headcount.

The Company ended the quarter with $11.6 million of cash and cash
equivalents.

About InVivo Therapeutics

InVivo Therapeutics Holdings Corp. is a research and clinical-stage
biomaterials and biotechnology company with a focus on treatment of
spinal cord injuries. The company was founded in 2005 with proprietary
technology co-invented by Robert Langer, Sc.D., Professor at
Massachusetts Institute of Technology, and Joseph P. Vacanti, M.D., who
then was at Boston Children's Hospital and who now is affiliated with
Massachusetts General Hospital. In January 2018, the company announced
updated clinical evidence, including improvements in patients with acute
spinal cord injury (SCI), from its INSPIRE study of the Neuro-Spinal
Scaffold
™. The publicly traded company is headquartered in
Cambridge, MA. For more details, visit www.invivotherapeutics.com.

Safe Harbor Statement

Any statements contained in this press release that do not describe
historical facts may constitute forward-looking statements within the
meaning of the federal securities laws. These statements can be
identified by words such as "believe," "anticipate," "intend,"
"estimate," "will," "may," "should," "expect" and similar expressions,
and include statements regarding potential financing, the commencement
of enrollment in the INSPIRE 2.0 trial and the expected length of the
trial, the impact of cost-control measures and the ability of the
Company to continue clinical investigation of the Company's Neuro-Spinal
Scaffold. Any forward-looking statements contained herein are based on
current expectations, and are subject to a number of risks and
uncertainties. Factors that could cause actual future results to differ
materially from current expectations include, but are not limited to,
risks and uncertainties relating to: successfully identify financing
alternatives and raise the capital necessary to undertake the second
pivotal trial, to successfully decrease costs and spend and to
successfully open additional clinical sites for enrollment and to enroll
additional patients if such trial is initiated; the timing of the
Institutional Review Board process; the company's ability to obtain FDA
approval to commercialize its products; the company's ability to
develop, market and sell products based on its technology; the expected
benefits and efficacy of the company's products and technology in
connection with spinal cord injuries; the availability of substantial
additional funding for the company to continue its operations and to
conduct research and development, clinical studies and future product
commercialization; and other risks associated with the company's
business, research, product development, regulatory approval, marketing
and distribution plans and strategies identified and described in more
detail in the company's Annual Report on Form 10-K for the year ended
December 31, 2017 and its other filings with the SEC, including the
company's quarterly reports on Form 10-Q and current reports on Form 8-K.

The company does not undertake to update these forward-looking
statements.

           
InVivo Therapeutics Holdings Corp.
Consolidated Balance Sheets

(Unaudited)

(In thousands, except share and per share data)

 
As of

March 31,
2018

December 31,
2017

ASSETS:
 
Current assets:
Cash and cash equivalents 11,614 12,910
Restricted cash 378 361
Prepaid expenses and other current assets 1,151 535
Total current assets 13,143 13,806
Property, equipment and leasehold improvements, net 72 157
Other assets 76 82
Total assets 13,291 14,045
 
LIABILITIES AND STOCKHOLDERS' EQUITY:
 
Current liabilities:
Accounts payable 1,228 988
Loan payable, current portion 459 452
Derivative warrant liability 2 4
Deferred rent, current portion 30 30
Accrued expenses 2,386 1,638
Total current liabilities 4,105 3,112
Loan payable, net of current portion 283 400
Deferred rent, net of current portion 522 367
Other liabilities 58 56
Total liabilities 4,968 3,935
 
Stockholders' equity:
Common stock, $0.00001 par value, authorized 4,000,000 shares;
issued and

outstanding 1,562,284 shares at March 31, 2018; issued and
outstanding 1,370,992

shares at December 31, 2017

 

1

 

1

Additional paid-in capital 197,013 194,016
Accumulated deficit (188,691) (183,907)
Total stockholders' equity 8,323 10,110
Total liabilities and stockholders' equity 13,291 14,045
 

(Reflects 1-for-25 reverse stock split effective April 16, 2018)

 
 
InVivo Therapeutics Holdings Corp.
Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)

(In thousands, except share and per share data)

     
Three Months Ended March 31,
2018       2017
Operating expenses:
Research and development 1,398 3,384
General and administrative 3,434 3,285
Total operating expenses 4,832 6,669
Operating loss (4,832) (6,669)
 
Other income (expense):
Interest income / (expense) 18 37
Other income / (expense) 42
Derivatives gain (loss) (12) 241
Other income (expense), net 48 278
Net loss (4,784) (6,391)
Net loss per share, basic and diluted (3.34) (4.98)
Weighted average number of
common shares outstanding, basic and diluted 1,432,963 1,283,206
 
Other comprehensive loss:
Net loss (4,784) (6,391)
Other comprehensive loss:
Unrealized loss on marketable securities (2)
Comprehensive loss (4,784) (6,393)
 

(Reflects 1-for-25 reverse stock split effective April 16, 2018)

 

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