North American Vaccine, Inc. Announces Operating Results For the First Quarter of 1999
COLUMBIA, Md., April 23 /PRNewswire/ -- North American Vaccine, Inc.
(Amex: NVX) today announced operating results for the quarter ended March 31,
1999.
Revenues in the three months ended March 31, 1999 were $1.5 million
compared to $834,000 in 1998 and the Company reported a net loss of $0.32 per
share versus a net loss of $0.37 per share in the first quarter of 1998. "U.S.
product sales in the first quarter were in line with expectations and we are
on track for achieving additional market share and other corporate objectives
established for 1999," noted Randal Chase, Ph.D., President and CEO. "For
example, during the first quarter we substantially shortened our filing time
for seeking regulatory approval of our group C meningococcal conjugate vaccine
in the U.K. Also, our clinical development programs for Amvax(R), our
diphtheria-tetanus, acellular pertussis vaccine for adolescents and adults,
and our DTaP-based combination vaccines for infants and children, are moving
forward as scheduled."
Revenues in the first quarter of 1999 consisted of approximately
$1.2 million from sales of Certiva(TM) in the United States and acellular
pertussis vaccine for products in Europe, and $365,000 from collaborative
agreements. Revenue during the same period in 1998 was primarily from
collaborative agreements as well as product sales of the Company's acellular
pertussis vaccine for European distribution.
"During the first quarter, there was an increase in Certiva(TM) sales to
Abbott, a greater number of states were shipped Certiva(TM) and reorders were
filled from existing public market customers," commented Stephen Keith, MD,
MSPH, Vice President -- Marketing and Sales. "While the number of doses of
Certiva(TM) sold were at about the same level compared to the previous
quarter, the first quarter was particularly encouraging given the historically
low volume of vaccine purchases during the winter and our limited production
capacity, which is expected to increase in May and again in the third
quarter." The implementation of plans to significantly increase production
capacity of the Company's acellular pertussis vaccine are on budget and on
track for completion in the third quarter 1999.
Dr. Keith continued, "Moving forward, revenues from product sales should
increase as evidenced by increasing quarter-to-quarter forecasts by Abbott,
and shipments to a growing number of state and local immunization programs.
In addition, the Company has shipped acellular pertussis vaccine to be used to
formulate DTaP-IPV (injectable polio combination) for sale in Germany by
Chiron Behring. The Company expects to realize revenues from those sales in
future quarters."
During the first quarter, the Company also significantly shortened its
timeline for preparing and submitting an application for regulatory approval
of its group C meningococcal conjugate vaccine in the United Kingdom. That
development should advance the timing for launch of, and revenues from, this
product. Meningococcal meningitis is the leading cause of death in children
one to four years of age in the U.K., as well as a leading cause of this
disease in the U.S. "We are quite confident that following approval, this
vaccine will be well received in the U.K. and subsequently other countries
based on previously announced comparative data from safety and immunogenicity
studies," noted Dr. Keith. North American Vaccine previously reported
comparative data from a safety and immunogenicity study of its group C
meningococcal conjugate vaccine conducted by the U.K. Public Health Laboratory
Service in toddlers. In that study, the Company's vaccine was compared head
to head against similar products in development and significantly outperformed
the two competing vaccine candidates. The Company estimates that the combined
US/European market for group C meningococcal conjugate vaccines will be
approximately $300 million per year.
Operating expenses in the first quarter of 1999 were $11.1 million as
compared to $11.5 million in the first quarter of 1998. Operating expenses
decreased in 1999 as compared to 1998 due to a reduction in depreciation
expense and the capitalization of inventory produced for sale in the current
quarter, offset in part by an increase in labor expense.
Programs have been put in place by management to reduce net cash used in
operations. These programs are designed to cut costs, more efficiently
utilize space, and enhance revenues through expanded production capacity,
among other things. More than fifteen areas have been identified to achieve
cost savings opportunities and spending plans have been adjusted accordingly
to reduce the net cash used in operations. The Company will reduce facilities
costs by canceling a lease for unneeded office and warehouse space and more
efficiently utilizing space within the Company's other facilities.
The Company plans to meet its cash requirements during 1999 and into 2000
through a combination of: present cash and cash equivalents; product sales;
fees and payments from existing and/or new license, marketing, distribution
and/or development agreements; the exercise of stock options; sale/lease
financing; lines of credit; or through the sale of debt and/or equity, if
needed.
Interest expense increased in the first quarter of 1999 compared to the
same period in 1998, primarily as a result of the 4.5% convertible secured
notes issued in November 1998. The net loss in the first quarter of 1999 was
$10.3 million or $0.32 per share as compared to a net loss of $11.8 million or
$0.37 per share for the same period in 1998. Without the gain on the sale of
an investment in an affiliate, the loss in 1999 would have been $11.2 million
or $0.35 per share. The weighted-average number of common shares outstanding
for the first quarter of 1999 was 32.3 million as compared to 32.0 million in
the same period in 1998. |
