10-K: Orgenesis Faces Going Concern Doubt Amid Delisting, Losses

Orgenesis Inc. reports substantial doubt about its ability to continue as a going concern, with significant net losses and a worsening working capital deficit, following its delisting from Nasdaq.

Summary

• Orgenesis Inc. is a global biotech company focused on decentralized cell and gene therapies (CGTs) using its Decentralized Cell Processing (DCP) Platform.
• The company reported a net loss of $49,013 thousand for the year ended December 31, 2024, compared to $64,918 thousand in 2023.
• Revenues increased by 95% to $1,035 thousand in 2024 from $530 thousand in 2023, primarily from cell process development and hospital services.
• Cost of revenues decreased by 69% to $1,928 thousand in 2024, mainly due to reduced activities and deconsolidation of certain subsidiaries.
• The company's working capital deficit significantly worsened to $26,159 thousand as of December 31, 2024, from $12,331 thousand in 2023.
• Cash and cash equivalents were critically low at $78 thousand as of December 31, 2024, down from $837 thousand in 2023.
• Outstanding debts totaled approximately $65.8 million as of December 31, 2024, with $6.3 million repaid in September 2025.
• Orgenesis completed a 1-for-10 reverse stock split on September 20, 2024.
• The company's common stock was delisted from Nasdaq in October 2024 and subsequently moved to the OTC Expert Market tier by July 29, 2025, due to filing delays.
• Several subsidiaries, including Orgenesis Biotech Israel Ltd (OBI), Orgenesis Korea Co. Ltd, Orgenesis Belgium SRL, and Orgenesis Services SRL, commenced liquidation activities in 2024.
• The company acquired 100% of Octomera LLC on January 29, 2024, reconsolidating it into its accounts, with potential future royalty and milestone payments to Metalmark Capital Partners.
• Orgenesis sold five Orgenesis Mobile Processing Units and Labs (OMPULs) to Germfree for an aggregate purchase price of $8,340 thousand, receiving $6,720 thousand by December 31, 2024.
• A debt-to-equity exchange occurred on May 21, 2024, converting $16,007 thousand of outstanding debt and interest into 1,577,695 shares of common stock.
• The company acquired assets related to CAR-T and oncology products from Broaden Bioscience and Technology Corp. and assets including TILs manufacturing processes and other cell therapy technologies from Theracell Advanced Biotechnology S.A.
• Material weaknesses in internal control over financial reporting were identified, particularly concerning revenue accounting, credit losses, and insufficient finance personnel.
• The company is actively seeking additional financing to meet its operational and liquidity needs.

Sentiment

Score: 2

Explanation: StockSavvy.ai views this filing with a highly negative sentiment due to the explicit 'going concern' doubt, severe liquidity crisis, Nasdaq delisting, significant impairment charges, and ongoing operational restructuring through subsidiary liquidations. While revenue growth and strategic asset acquisitions show some underlying business activity, the overwhelming financial distress and governance issues overshadow any positives.

Positives

• Revenue increased by 95% to $1,035 thousand in 2024, driven by cell process development and hospital services.
• Cost of revenues decreased significantly by 69% in 2024, partly due to strategic restructuring and reduced activities in certain segments.
• The company successfully reconsolidated Octomera LLC, gaining 100% equity interest, which is central to its POCare strategy.
• Strategic asset acquisitions from Broaden Bioscience and Technology Corp. and Theracell Advanced Biotechnology S.A. expanded the company's intellectual property and therapeutic pipeline, including CAR-T, TILs, and other advanced cell therapy technologies.
• Promising real-world clinical data for the anti-CD19 CAR-T therapy showed high complete response rates (82% in adults, 93% in pediatric patients) and a strong safety profile (severe CRS in only 2-6% of patients) in Asia.
• The DCP platform is estimated to reduce CAR-T production costs by 73%, from $152,500 to $41,750 per batch, enhancing economic accessibility.
• Theracell Laboratories in Greece received a 'Priority Investment of Strategic National Importance' designation, which is expected to fast-track licensing and approval processes for CGT development and clinical use.
• MIDA Biotech BV was granted a 4 million Euro grant for iPSC production using microfluidic technologies and AI, supporting cutting-edge R&D.

Negatives

• The company reported a substantial net loss of $49,013 thousand in 2024, indicating continued unprofitability.
• A significant working capital deficit of $26,159 thousand as of December 31, 2024, worsened from $12,331 thousand in 2023, highlighting severe liquidity issues.
• Cash and cash equivalents are critically low at $78 thousand as of December 31, 2024, down from $837 thousand in 2023.
• Outstanding debts amounted to approximately $65.8 million as of December 31, 2024.
• The company's common stock was delisted from Nasdaq in October 2024 and subsequently moved to the less liquid OTC Expert Market tier, restricting public access to trading information and potentially limiting future capital raises.
• Multiple subsidiaries (Orgenesis Biotech Israel Ltd, Orgenesis Korea Co. Ltd, Orgenesis Belgium SRL, Orgenesis Services SRL) commenced liquidation activities in 2024, indicating operational distress and restructuring.
• The company recorded significant impairment expenses of $18,338 thousand in 2024, including goodwill ($1,211 thousand), property, plant and equipment ($8,752 thousand), and intangible assets ($8,375 thousand).
• Material weaknesses in internal control over financial reporting were identified, particularly in revenue accounting and credit loss estimation, and an inadequate number of personnel in finance and accounting.
• The company incurred a loss from extinguishment in connection with loans of $5,422 thousand in 2024.
• Convertible loans induced conversion expenses amounted to $4,304 thousand in 2024, reflecting the cost of debt-to-equity exchanges.
• Germfree notified the company of its intention not to lease OMPULs back, meaning no further payments are expected from that agreement.

Risks

• Substantial doubt exists about the company's ability to continue as a going concern due to recurring losses and negative cash flows.
• The POCare business has a limited operating history and an unproven business model, facing significant challenges in a rapidly evolving cell therapy industry.
• The company requires immediate additional capital, which may not be available on acceptable terms or at all, potentially leading to delays, reduced scope of business activities, or even bankruptcy.
• Research and development programs based on novel technologies are inherently risky, with significant challenges in product development, manufacturing, regulatory approval, and market acceptance.
• KYSLECEL may not achieve sufficient patient or market acceptance, impacting profitability.
• The therapeutic efficacy of Ranpirnase and other product candidates is unproven in humans, and successful development and commercialization are uncertain.
• Difficulties in managing growth are expected as the company needs to add significant managerial, operational, sales, marketing, financial, and other personnel.
• Reliance on strategic collaborations with third parties means a lack of control over key development and commercialization elements, and partners may not perform as expected.
• The company's success depends on its ability to protect its intellectual property, and third parties may allege infringement, leading to costly legal proceedings or limitations on commercialization.
• The ability to develop and roll out Decentralized Production Units (DPUs) and OMPULs may be hindered by zoning, environmental, medical waste, or other licensing regulations.
• Product liability lawsuits could result in substantial liabilities and limit commercialization of product candidates.
• Increasing dependence on information technology exposes the company to cybersecurity and data storage risks, with potential for service interruptions or security breaches.
• The company lacks in-house sales and commercial distribution capabilities and may struggle to establish or maintain third-party collaborations for commercialization.
• Product candidates may cause undesirable side effects, halting clinical development or limiting commercial potential.
• The complex manufacture of biologics, including process development and scaling, may lead to production difficulties, delays, or commercially unviable cost structures.
• Reliance on sole or limited source vendors for reagents, specialized equipment, and materials could impair manufacturing and supply capabilities.
• Operations in Israel are subject to economic, political, geopolitical, and military conditions, including the ongoing conflict, which may disrupt business and affect employee availability.
• Currency exchange fluctuations, particularly the euro-to-U.S. dollar rate, may impact operating results.
• Inability to effectively integrate acquired businesses could adversely affect operating results.
• The Israeli Subsidiary's license agreement with THM is at risk of cancellation or challenge, potentially impacting the trans-differentiation technology for diabetes.
• Extensive and evolving industry regulation significantly impacts product development, manufacturing, and distribution capabilities, with non-compliance leading to severe sanctions.
• The company has generated limited revenue from therapeutic product sales, and profitability depends on numerous uncertain factors, including regulatory approvals, market acceptance, and manufacturing scalability.
• Clinical trials are expensive, time-consuming, and subject to uncertainty, with potential for delays, suspensions, or negative results.
• The delisting from Nasdaq and trading on the OTC Expert Market reduces liquidity, market visibility, and ability to raise capital, and may deter institutional investors.
• Failure to timely file periodic reports with the SEC could lead to regulatory actions, legal proceedings, and further negative impact on stock price and business growth.
• Future issuance of common stock, particularly from the Alpha Prosperity Fund SPC convertible loan and warrants, could result in significant dilution for existing stockholders and a change of control.

Future Outlook

The company expects its current and projected cash resources and commitments will not be sufficient to meet its obligations for the next 12 months, raising substantial doubt about its ability to continue as a going concern. Management plans include raising additional capital, increasing revenue, and reducing capital expenditures. The company intends to reapply for listing on the OTCQX Market as soon as it becomes current in its SEC filings.

Management Comments

• Management concluded that, based on expected operating losses and negative cash flows, there is substantial doubt about our ability to continue as a going concern for the twelve months after the date the financial statements were issued.
• Management is unable to predict if and when we will be able to generate significant revenues or achieve profitability.
• Our plan regarding these matters is to continue improving the net results in our POCare business into fiscal year 2025.
• Management is committed to improving its internal controls and will continue to use third-party specialists, increase independent reconciliations, and may consider appointing outside directors and audit committee members.
• Management believes that the material weaknesses did not have an effect on our financial results.

Industry Context

StockSavvy.ai notes that Orgenesis operates in the rapidly growing yet intensely competitive cell and gene therapy (CGT) market, characterized by high development costs and complex regulatory pathways. While the industry saw significant FDA approvals and large pharma acquisitions in 2023-2024 (e.g., Gilead-Kite, Roche-Spark, AstraZeneca-Gracell), Orgenesis's decentralized, automated POCare platform aims to address the scalability and cost challenges that currently limit market adoption of CGTs. The company's focus on autologous therapies and partnerships with hospitals and research centers aligns with trends seeking to make these 'living drugs' more accessible, but its severe liquidity issues and delisting contrast sharply with the significant capital inflows seen by more established or well-funded players in the space.

Comparison to Industry Standards

• Orgenesis's CAR-T CD19 therapy demonstrated a 73% reduction in production costs per batch (from $152,500 to $41,750) compared to traditional centralized manufacturing, a significant advantage over industry benchmarks for similar therapies like those developed by Kite Pharma (acquired by Gilead) or Spark Therapeutics (acquired by Roche), which are known for their high costs.
• The reported complete response rates for Orgenesis's CAR-T CD19 therapy (82% in adults, 93% in pediatric patients) and low severe Cytokine Release Syndrome (CRS) rates (2% in adults, 6% in pediatric patients) are competitive with, and in some safety aspects potentially superior to, existing FDA-approved CAR-T therapies for B-cell ALL and lymphomas, such as Kymriah (Novartis) and Yescarta (Kite Pharma/Gilead), which have reported varying efficacy and toxicity profiles.
• The company's strategy of leveraging a decentralized point-of-care (POCare) model with standardized production units aims to overcome the logistical and cost limitations of centralized manufacturing, a challenge faced by all ATMP developers, including major players like Lonza and Catalent, who primarily offer large-scale centralized CDMO services.
• The identification of material weaknesses in internal control over financial reporting and the delisting from Nasdaq place Orgenesis significantly below the corporate governance and financial reporting standards expected of publicly traded biotechnology companies, especially those seeking to attract institutional investment for capital-intensive R&D.

Management Changes

Corporate Governance

Legal Proceedings

• A complaint was filed in Tel Aviv District Court on January 18, 2022, by the State of Israel and Tel Hashomer Medical Research, Infrastructure and Services Ltd. (THM) against the Company and others, seeking royalties (7% of sales, 24% of sublicensing fees) and financial statements related to know-how and technology. Mediation is ongoing, and management estimates a loss is not probable.
• A claim was filed in Tel Aviv District Court on September 6, 2023, by Ehud Almon against the Company and others for finders fees/royalties ($896 thousand) related to sales by an Octomera subsidiary. The Company disputes the claim, and a ruling on service of process is pending. Management estimates the likelihood of the Plaintiff winning is less than fifty percent.
• A complaint was filed in the Supreme Court of New York on October 26, 2023, by Southern Israel Bridging Fund Two LP and Mr. Amir Hasidim against the Company, seeking payment of $1,150 thousand plus interest based on a Convertible Loan Agreement. The Company disputes the amount and has counter-sued for breach of contract, fraud, and harassment.
• A claim was filed in Tel Aviv District Court on November 1, 2023, by Fidelity Venture Capital Ltd. and Dror Atzmon against the Company and others, requesting NIS 40,143 thousand in damages and the issuance of 1,186,960 shares of common stock related to a convertible note and consultation agreement. Mediation is ongoing, and management estimates the likelihood of the Plaintiffs winning is less than fifty percent.
• The Israeli subsidiary reached a settlement agreement on July 11, 2024, regarding unpaid rentals, agreeing to pay NIS 427,000 (approximately $114 thousand). As of the filing date, $47 thousand remains deferred, with potential liability for an additional NIS 211,000 ($57 thousand) if obligations are not met.
• The Lige Business Court in Belgium appointed provisional liquidators for Orgenesis Belgium SRL and Orgenesis Services SRL on December 20, 2024, following their inability to pay employee payroll and accounts payable.
• Murray Bacal filed a complaint against Orgenesis, Inc. in Florida on December 19, 2024, for non-payment for strategic advisor services. A default final judgment of $512 thousand plus interest was entered on June 8, 2025, but was vacated in its entirety on March 4, 2026.
• On January 30, 2026, the Company was served with a complaint by Newtech Investment Holdings, LLC, Ariel Malik, and Guy Hoffman requesting specific performance related to a Joint Venture Agreement. The Company disputes the claims and intends to contest them vigorously.

Related Party Transactions

• Stock-based compensation expenses to executive officers were $89 thousand in 2024 and $78 thousand in 2023.
• Stock-based compensation expenses to Board Members were $405 thousand in 2024 and $99 thousand in 2023.
• Compensation of executive officers was $323 thousand in 2024 and $690 thousand in 2023.
• Management and consulting fees to Board Members were $277 thousand in 2024 and $380 thousand in 2023.
• Executive officers payables were $225 thousand in 2024 and $150 thousand in 2023.
• Non-executive directors payable were $543 thousand in 2024 and $938 thousand in 2023.
• Amounts payable to Orgenesis Biotech Israel Ltd (OBI) were $(2,695) thousand in 2024 (a liability owed by the company to OBI) and $0 in 2023.
• The company entered into a convertible loan agreement with Yehuda Nir (Lender, a related party) on March 27, 2023, for Koligo Therapeutics Inc., with an interest rate of 8% per annum.
• The company entered into a loan extension agreement with Yehuda Nir on October 31, 2024, extending maturity dates of certain loans and issuing warrants to purchase 4,913,661 shares of common stock at $1.03 per share.
• A promissory note was entered into with Jacob Safier (a related party) on November 4, 2024, for Orgenesis Maryland LLC, issuing five-year warrants to purchase 242,718 shares of common stock at $1.03 per share.

Stakeholder Impact

• **Shareholders:** Face significant dilution from recent and potential future equity issuances and debt conversions. The Nasdaq delisting and move to OTC Expert Market severely impacts liquidity and the ability to trade shares, potentially leading to substantial losses. The 'going concern' doubt poses an existential threat to their investment.
• **Employees:** Experience uncertainty due to subsidiary liquidations (e.g., OBI, Orgenesis Korea, Belgian subsidiaries) and the company's precarious financial position, which could affect job security and compensation. The company's ability to attract and retain key personnel is at risk.
• **Customers/Partners:** May face uncertainty regarding the company's long-term viability and ability to fulfill contractual obligations, especially for ongoing development services and product supply. The deconsolidation of subsidiaries and financial instability could impact trust and future collaborations.
• **Creditors:** Face significant risk due to the company's substantial outstanding debts ($65.8 million) and expressed doubt about its ability to meet obligations. The company's intention to seek payment delays indicates potential challenges in debt repayment.
• **Regulatory Bodies:** The company's inability to timely file SEC reports and identified material weaknesses in internal controls could lead to further regulatory scrutiny and potential enforcement actions.

Next Steps

• Raise additional capital through equity offerings or debt financings to fund operations and repay outstanding loans.
• Continue efforts to increase revenue and reduce capital expenditures.
• Remediate identified material weaknesses in internal control over financial reporting, including improving financial analysis and staffing.
• Complete and file all required periodic reports to regain compliance with Exchange Act reporting obligations.
• Reapply for listing on the OTCQX Market as soon as current in SEC filings.
• Continue mediation proceedings for the legal claim filed by Tel Hashomer Medical Research, Infrastructure and Services Ltd (THM).
• Continue mediation proceedings for the legal claim filed by Fidelity Venture Capital Ltd. and Dror Atzmon.
• Develop and commercialize therapeutic product candidates, including advancing clinical trials and establishing sales and marketing capabilities.
• Integrate acquired businesses and product portfolios effectively.

Key Dates

Recommendation

The company faces an immediate and severe liquidity crisis, explicitly stating 'substantial doubt as to our ability to continue as a going concern.' This fundamental issue is compounded by a significant working capital deficit, critically low cash reserves, and substantial outstanding debt. The delisting from Nasdaq to the OTC Expert Market has drastically reduced liquidity and investor access, making it difficult for shareholders to exit positions. While there are some positive developments in revenue growth and strategic asset acquisitions, these are overshadowed by the overwhelming financial distress, operational restructuring through subsidiary liquidations, and identified material weaknesses in internal controls. The potential for extreme dilution from ongoing capital raise efforts and the risk of bankruptcy make the stock a 'strong sell' for any seasoned investor or institution.

Keywords

Cell and Gene Therapy, Biotech, Decentralized Cell Processing, ATMP, CAR-T, TILs, Pancreatic Islets, Regenerative Medicine, Oncology, Metabolic Diseases, Liquidity Crisis, Going Concern, Nasdaq Delisting, OTC Expert Market, Subsidiary Liquidation, Intellectual Property, Clinical Trials, Biologics Manufacturing, Capital Raise, Debt-to-Equity Exchange, Internal Control Weakness, Biopharmaceutical Industry, Healthcare Technology