International Stem Cell CORP 10-K for FY2022

International Stem Cell CORP (ISCO)

10-K 2023-03-30 For: 2022-12-31

Added on April 06, 2026

About this 10-K

International Stem Cell CORP filed this 10-K on March 30, 2023, covering the fiscal year ended December 31, 2022 (FY2022).

Headline figures

Fiscal year ended December 31, 2022, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $8.18M; up 14.0% from $7.18M a year earlier
Net loss: $331K; compared with a net loss of $899K a year earlier
Diluted EPS: -$0.04; compared with -$0.11 a year earlier

Search and read filings like this one from Claude or ChatGPT with the SEC filings MCP server →


Title of each class	Trading symbol	Name of each exchange on which registered
None	None	None


Large accelerated filer	☐	Accelerated filer	☐

Non-accelerated filer	☒	Smaller reporting company	☒

		Emerging growth company	☐


		Page

Cautionary Note Regarding Forward-Looking Statements		i

PART I

Item 1.	Business	1

Item 1A.	Risk Factors	12

Item 1B.	Unresolved Staff Comments	26

Item 2.	Properties	26

Item 3.	Legal Proceedings	26

Item 4.	Mine Safety Disclosures	26

PART II

Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	27

Item 6.	(Reserved)	27

Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	28

Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	35

Item 8.	Financial Statements and Supplementary Data	35

Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	35

Item 9A.	Controls and Procedures	35

Item 9B.	Other Information	36

Item 9C.	Disclosures Regarding Foreign Jurisdictions that Prevent Inspections	36

PART III

Item 10.	Directors, Executive Officers and Corporate Governance	37

Item 11.	Executive Compensation	37

Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	37

Item 13.	Certain Relationships and Related Transactions, and Director Independence	37

Item 14.	Principal Accounting Fees and Services	38

PART IV

Item 15.	Exhibits, Financial Statement Schedules	39

Item 16.	Form 10-K Summary	41

SIGNATURES		42


	Years Ended December 31,
	2022			2021			$ Change			% Change
Product sales	$	8,180		$	7,176		$	1,004			14	%
Cost of sales		3,269			2,935			334			11	%
As a % of revenues		40	%		41	%
General and administrative		3,357			4,084			(727	)		-18	%
Selling and marketing		1,245			1,383			(138	)		-10	%
Research and development		492			695			(203	)		-29	%
Other income (expense), net		(148	)		1,022			(1,170	)		-114	%
Net loss	$	(331	)	$	(899	)	$	568			-63	%
As a % of revenues		-4	%		-13	%


	Years Ended December 31,
	2022			2021
Net cash provided by (used in) operating activities	$	332		$	(1,297	)
Net cash used in investing activities		(11	)		(45	)
Net cash provided by financing activities		250			824
Net increase (decrease) in cash	$	571		$	(518	)


Name	Position	Age
Andrey Semechkin	Co-Chairman and Chief Executive Officer	63
Russell Kern	Executive Vice President, Chief Scientific Officer, and Principal Financial Officer	37


Exhibit Number		Exhibit Description

3.1		Certificate of Incorporation (incorporated by reference to Exhibit 3.4 of the Registrant’s Form 10-SB filed on April 4, 2006).

3.2		Certificate of Amendment of Certificate of Incorporation (incorporated by reference to Exhibit 3.1 of the Registrant’s Preliminary Information Statement on Form 14C filed on December 29, 2006).

3.3		Certificate of Amendment of Certificate of Incorporation (incorporated by reference to Exhibit 3.1 of the Registrant’s Form 8-K filed on June 4, 2012).

3.4		Certificate of Amendment to Certificate of Incorporation (incorporated by reference to Exhibit 3.1 of the Registrant’s Form 8-K filed on December 5, 2014).

3.5		Certificate of Amendment to Certificate of Incorporation (incorporated by reference to Exhibit 3.1 of the Registrant’s Form 8-K filed on July 28, 2015).

3.6		Certificate of Amendment to Certificate of Incorporation (incorporated by reference to Exhibit 3.1 of the Registrant’s Form 8-K filed on May 19, 2017).

3.7		Amended and Restated Bylaws of the Registrant (incorporated by reference to Exhibit 3.1 of the Registrant’s Form 8-K filed on May 6, 2011).

4.1		Form of Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 of the Registrant’s Form 10-KSB filed on April 9, 2007).

4.2		Certification of Designation of Series B Preferred Stock (incorporated by reference to Exhibit 4.1 of the Registrant’s Form 8-K filed on May 12, 2008).

4.3		Certification of Designation of Series D Preferred Stock (incorporated by reference to Exhibit 10.2 of the Registrant’s Form 8-K filed on January 5, 2009).

4.4		Certificate of Designation of Series G Preferred Stock (incorporated by reference to Exhibit 3.1 of the Registrant’s Form 8-K filed on March 14, 2012).

4.5		Certificate of Preferences, Rights and Limitations of Series I-2 Convertible Preferred Stock (incorporated by reference to Exhibit 3.2 of the Registrant’s Form 8-K filed on March 10, 2016).

4.6		Description of the Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 (incorporated by reference to Exhibit 4.7 of the Registrant’s Form 10-K filed March 30, 2021).

10.1		2010 Equity Participation Plan (incorporated by reference to Exhibit 10.1 of the Registrant’s Form 10-Q filed on August 12, 2020).


Exhibit Number		Exhibit Description


10.2		Amended and Restated Investors Rights Agreement dated March 9, 2012 (incorporated by reference to Exhibit 10.2 of the Registrant’s Form 8-K filed on March 15, 2012).

10.3		Management Rights Letter dated March 9, 2012 (incorporated by reference to Exhibit 10.3 of the Registrant’s Form 8-K filed on March 15, 2012).

10.4		Dividend Waiver Agreement dated October 12, 2012 (incorporated by reference to Exhibit 10.29 of the Registrant’s Form S-1 filed on October 18, 2012).

10.5		Amended and Restated License Agreement with Advanced Cell Technology, Inc. dated February 7, 2013 (ACT IP) (incorporated by reference to Exhibit 10.1 of the Registrant’s Amendment to Form 8-K filed on February 14, 2013)

10.6		Amended and Restated License Agreement with Advanced Cell Technology, Inc. (UMass IP) (incorporated by reference to Exhibit 10.3 of the Registrant’s Amendment to Form 8-K filed on February 14, 2013).

10.7		Amended and Restated License Agreement dated February 7, 2013 with Advanced Cell Technology, Inc. (Infigen IP) (incorporated by reference to Exhibit 10.2 of the Registrant’s Amendment to Form 8-K filed on February 14, 2013).

10.8		Amendment dated November 13, 2014 to Amended and Restated Investor Rights Agreement dated as of March 9, 2012 (incorporated by reference to Exhibit 10.1 of the Registrant’s Form 8-K filed on November 18, 2014).

10.9		Waiver Agreement dated December 31, 2014 with holders of Series G Preferred Stock (incorporated by reference by Exhibit 10.32 of the Registrant’s Form 10-K filed March 30, 2015).

10.10		Registration Rights Agreement, dated January 8, 2016, by and between International Stem Cell Corporation and Andrey Semechkin (incorporated by reference to Exhibit 10.3 of the Registrant’s Form 8-K filed on January 12, 2016).

10.11		Form of Registration Rights Agreement (incorporated by reference to Exhibit 10.2 of the Registrant’s Form 8-K filed on March 10, 2016).

10.12		Lease Agreement dated October 26, 2021 (incorporated by reference to Exhibit 10.12 of the Registrant's Form 10-K filed on March 29, 2022)

10.13		Lease Agreement dated November 30, 2021 (incorporated by reference to Exhibit 10.13 of the Registrant's Form 10-K filed on March 29, 2022)

10.14		Co-Tenant Agreement dated December 15, 2021 (incorporated by reference to Exhibit 10.14 of the Registrant's Form 10-K filed on March 29, 2022)

10.15		Form of Note issued on September 15, 2022 (incorporated by reference to Exhibit 10.1 of the Registrant’s Form 8-K filed on September 16, 2022).

10.16		Form of Note issued on March 15, 2023 (incorporated by reference to Exhibit 10.1 of the Registrant’s Form 8-K filed on March 16, 2023).

21.1		Subsidiaries of the Registrant (incorporated by reference to Exhibit 21.1 of the Registrant’s Form 10-K filed on March 30, 2016).

23.1*		Consent of BDO USA, LLP

24.1*		Power of Attorney (included on signature page hereto)

31.1*		Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer

31.2*		Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer

32.1*		Section 1350 Certification of Chief Executive Officer

32.2*		Section 1350 Certification of Chief Financial Officer

101.INS*		Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document

101.SCH*		Inline XBRL Taxonomy Extension Schema

101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase


Exhibit Number		Exhibit Description


101.DEF*		Inline XBRL Taxonomy Definition Linkbase Document

101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase

101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase

104*		Cover Page Interactive Data File (embedded within the Inline XBRL document)


INTERNATIONAL STEM CELL CORPORATION

By:		/s/ ANDREY SEMECHKIN
Name:		Andrey Semechkin
Title:		Chief Executive Officer


Signature:	Capacity:	Date:

/s/ ANDREY SEMECHKIN	Co-Chairman of the Board and Chief Executive Officer (Principal Executive Officer)	March 30, 2023
Andrey Semechkin

/s/ RUSSELL KERN	Executive Vice President, Chief Scientific Officer, and	March 30, 2023
Russell Kern	Director (Principal Financial and Accounting Officer)

/s/ DONALD A. WRIGHT	Co-Chairman of the Board	March 30, 2023
Donald A. Wright

/s/ PAUL V. MAIER	Director	March 30, 2023
Paul V. Maier


		Page
Report of Independent Registered Public Accounting Firm (BDO USA, LLP; San Diego, California; PCAOB ID No. 243)		F-2
Consolidated Balance Sheets		F-4
Consolidated Statements of Operations		F-5
Consolidated Statements of Changes in Redeemable Convertible Preferred Stock and Stockholders’ Deficit		F-6
Consolidated Statements of Cash Flows		F-7
Notes to Consolidated Financial Statements		F-8


	December 31,			December 31,
	2022			2021
Assets
Current assets:
Cash	$	742		$	171
Accounts receivable, net		747			844
Inventory, net		1,384			1,184
Prepaid expenses and other current assets		90			135
Total current assets		2,963			2,334
Non-current inventory, net		286			372
Property and equipment, net		248			384
Intangible assets, net		878			949
Right-of-use assets		727			868
Deposits and other assets		33			39
Total assets	$	5,135		$	4,946
Liabilities, Redeemable Convertible Preferred Stock and Stockholders' Deficit
Current liabilities:
Accounts payable	$	322		$	508
Accrued liabilities		508			404
Operating lease liabilities, current		230			179
Advances		250			250
Related party note payable		3,325			2,943
Total current liabilities		4,635			4,284
Operating lease liabilities, net of current portion		720			950
Total liabilities		5,355			5,234
Commitments and contingencies (Note 11)
Series D redeemable convertible preferred stock, $0.001 par value; 50 shares authorized; 43 shares issued and outstanding; liquidation preference of $4,300 at December 31, 2022 and 2021		4,300			4,300
Stockholders' Deficit:
Non-redeemable convertible preferred stock, $0.001 par value; 10,004,310 and 10,004,310 shares authorized, 5,254,310 and 5,254,310 shares issued and outstanding, liquidation preference of $9,781 and $9,766 at December 31, 2022 and December 31, 2021, respectively		5			5
Common stock, $0.001 par value; 120,000,000 shares authorized; 8,004,389 and 8,004,389 shares issued and outstanding at December 30, 2022 and 2021, respectively		8			8
Additional paid-in capital		105,812			105,413
Accumulated deficit		(110,345	)		(110,014	)
Total stockholders' deficit		(4,520	)		(4,588	)
Total liabilities, redeemable convertible preferred stock and stockholders' deficit	$	5,135		$	4,946



	Series D Redeemable				Non-redeemable
	Convertible				Convertible					Common				Additional					Total
	Preferred Stock				Preferred Stock					Stock				Paid-in		Accumulated			Stockholders'
	Shares		Amount		Shares			Amount		Shares		Amount		Capital		Deficit			Deficit
Balance at December 31, 2020		—	$	4,300		5,255		$	5		7,539	$	8	$	104,769	$	(109,115	)	$	(4,333	)
Conversion of Series I-1 preferred stock		—		—		(1	)		—		465		—		—		—			—
Stock-based compensation		—		—		—			—		—		—		644		—			644
Net loss		—		—	—				—	—			—		—		(899	)		(899	)
Balance at December 31, 2021		—		4,300		5,254			5		8,004		8		105,413		(110,014	)		(4,588	)
Stock-based compensation		—		—		—			—		—		—		399		—			399
Net loss		—		—		—			—		—		—		—		(331	)		(331	)
Balance at December 31, 2022		—	$	4,300		5,254		$	5		8,004	$	8	$	105,812	$	(110,345	)	$	(4,520	)


	Year Ended December 31, 2022
					Total		% of Total
	Domestic		International		Revenues		Revenues
Biomedical products
Cells	$	1,442	$	499	$	1,941		27	%
Media		4,572		618		5,190		73	%
Total	$	6,014	$	1,117	$	7,131		100	%


	As of December 31,
	2022			2021
Raw materials	$	615		$	592
Work in process		498			507
Finished goods		1,194			983
		2,307			2,082
Less: allowance for inventory excess and obsolescence		(637	)		(526	)
Total current and non-current inventory, net	$	1,670		$	1,556

Inventory, net	$	1,384		$	1,184
Non-current inventory		286			372
Total current and non-current inventory, net	$	1,670		$	1,556


	As of December 31,
	2022			2021
Balance, beginning of year	$	526		$	611
Provision for inventory reserve		218			89
Write-offs		(107	)		(174	)
Balance, end of year	$	637		$	526


	As of December 31,
	2022			2021
Machinery and equipment	$	1,603		$	1,610
Computer equipment and software		217			243
Office equipment		89			104
Leasehold improvements		558			549
Construction in progress		—			1
		2,467			2,507
Less: accumulated depreciation and amortization		(2,219	)		(2,123	)
Property and equipment, net	$	248		$	384


	As of December 31,
	2022			2021
Patents	$	1,286		$	1,277
Less: accumulated amortization		(483	)		(403	)
		803			874
Indefinite life logos and trademarks		75			75
Intangible assets, net	$	878		$	949


	Year Ended December 31, 2021
					Total		% of Total
	Domestic		International		Revenues		Revenues
Biomedical products
Cells	$	801	$	546	$	1,347		23	%
Media		3,935		654		4,589		77	%
Total	$	4,736	$	1,200	$	5,936		100	%


	Year Ended December 31,
	2022					2021
	Total		% of Total			Total		% of Total
	Revenues		Revenues			Revenues		Revenues
Skin care sales channels
Ecommerce	$	1,049		100	%	$	913		74	%
Professional		—		0	%		327		26	%
Total	$	1,049		100	%	$	1,240		100	%


Years ending December 31,
2023	$	82
2024		82
2025		80
2026		76
2027		73
Thereafter		410
Total	$	803


	Shares		Shares Issued		Liquidation		Carrying
	Authorized		and Outstanding		Preference		Value
					(in thousands)
Series B		5,000,000		250,000	$	471	$	—
Series G		5,000,000		5,000,000		5,000		5
Series I-2		4,310		4,310		4,310		—
Total		10,004,310		5,254,310	$	9,781	$	5


					Conversion
	Initial		Current		Ratio to
	Conversion		Conversion		Common
	Price		Price		Stock
Series B	$	75.00	$	0.39		2.56
Series D	$	37.50	$	1.75		57,142.86
Series G	$	60.00	$	9.69		0.10
Series I-2	$	1.75	$	1.75		571.43


Options outstanding			6,858,492
Common stock available for issuance under the 2010 Plan			2,674,566
Redeemable convertible preferred stock			2,457,143
Non-redeemable convertible preferred stock			3,619,379
Total			15,609,580


						Weighted-
						Average
				Weighted-		Remaining		Aggregate
	Number of			Average		Contractual		Intrinsic
	Outstanding			Exercise		Term		Value
	Options			Price		(in years)		(in thousands)
Outstanding at December 31, 2021		5,373,203		$	1.42
Granted		2,338,528		$	0.45
Forfeited or cancelled		(846,468	)	$	1.58
Expired		(6,771	)	$	51.98
Outstanding at December 31, 2022		6,858,492		$	1.02		7.37	$	—
Vested and expected to vest at December 31, 2022		6,557,597		$	1.05		7.29	$	—
Exercisable at December 31, 2022		4,561,172		$	1.31		6.49	$	—


Balance at December 31, 2021	$	—
Increase (decrease) of unrecognized tax benefits taken in prior years		953
Balance at December 31, 2022	$	953