ARIAD Reports 30% Reduction in First Quarter Operating Loss and Receipt of $12 Million From Exercise of Publicly Traded Warrants
Business Wire - May 03, 2000 08:31
CAMBRIDGE, Mass.--(BUSINESS WIRE)--May 3, 2000--ARIAD Pharmaceuticals, Inc. (Nasdaq: ARIA) today reported a net loss of $3.5 million or $.15 per share for the first quarter of 2000, a reduction of $1.4 million, approximately 30% from the net loss of $4.9 million or $.23 per share reported for the first quarter of 1999.
Through April 26, 2000, the Company received $11.7 million from the exercise of 1.4 million of its publicly traded Warrants, which were exercisable one for one at $8.40 per share. The Warrants expired as of April 27, 2000.
Research revenue for the first quarter of 2000 decreased to $108,000 from the $4.6 million recognized for the same period in 1999. This decrease is due principally to restructuring the Company's collaborations with Aventis Pharmaceuticals, Inc. in December 1999. ARIAD sold its 50% interest in the Hoechst-ARIAD Genomics Center, LLC (the "Genomics Center") to Aventis and acquired the rights to the drug candidates and related technologies developed in its four-year osteoporosis collaboration with Aventis (the "Osteoporosis Agreement"). Research services provided by ARIAD to the Genomics Center, as well as research revenue recognized under the Osteoporosis Agreement, ended as part of the restructuring. The sale of the Genomics Center resulted in the recognition of a $46.4 million net gain in the fourth quarter of 1999.
Research and development expenses for the first quarter of 2000 decreased to $2.9 million from $8.5 million reported for the first quarter of 1999. This reduction of $5.6 million, or 66%, is due largely to the termination of research on behalf of the Genomics Center as of December 1999.
General and administrative expenses for the first quarter increased to $977,000 from $730,000 reported for the first quarter of 1999, primarily due to increased legal expenses incurred in connection with repurchase of the outstanding Series C Convertible Preferred Stock, which was completed on January 14, 2000.
At March 31, 2000, the Company reported cash and cash equivalents of $25.1 million and working capital of $23.3 million compared to cash and cash equivalents of $28.3 million and working capital of $22.7 million at December 31, 1999.
"With the exercise of our publicly traded Warrants, we have over $35 million available to fund our operations, including further development of our gene regulation and gene activation technology platforms," stated Jay LaMarche, chief financial officer of ARIAD.
"Our favorable financial results, strong cash position, and important achievements thus far in the year 2000 highlight ARIAD's recent progress," said Harvey J. Berger, M.D., chairman and chief executive officer of ARIAD. "Accelerating the clinical development of our lead product candidates and establishing new corporate partnerships are our priorities," added Dr. Berger.
Significant achievements for ARIAD thus far in the year 2000 include:
- Breakthrough in the development of stem cell therapy using the
ARIAD Regulated Gene Expression Technology (ARGENT(tm)) system to
control the growth and differentiation of pluripotent stem cells.
- Expansion of ongoing collaboration with the University of
Washington involving the development of ARGENT-based stem cell
therapy products and the exclusive licensing of two patent
applications covering methods for controlling the growth and
differentiation of stem cells and other progenitor cells using
ARGENT.
- Use of the ARGENT gene regulation technology to control stem cells
featured in the April 21, 2000 issue of the Wall Street Journal.
- Publication in Science on the development of ARIAD's new gene
regulation technology -- known as RAPID(tm) (Regulated
Accumulation of Proteins for Immediate Delivery) -- that allows
pulsatile delivery of therapeutic proteins, such as insulin, using
gene therapy regulated by an orally administered drug.
- Use of the RAPID gene regulation technology to treat
insulin-dependent diabetes featured in the February 14, 2000 issue
of Business Week.
- Publication in Chemistry & Biology on the development of a new
class of selective small-molecule drugs that inhibit signaling
pathways responsible for the breakdown of bone -- providing a new
approach to the treatment of osteoporosis.
- ARIAD's gene-targeted drug, AP1903, granted orphan drug status for
the treatment of acute graft-versus-host disease (GvHD) by the
U.S. Food and Drug Administration.
- Phase 2 clinical trials of the ARGENT GvHD product in patients
with hematologic malignancies undergoing allogeneic bone marrow
transplantation scheduled to begin at the Fred Hutchinson Cancer
Research Center, Seattle, and at the Hospital San Raffaele, Milan.
- Expanded access to ARIAD's proprietary gene regulation and gene
activation technologies provided to over 275 academic
investigators in exchange for commercial rights to inventions
using ARGENT and RAPID. Diverse scientific studies, including
development of novel animal models of disease by activating,
inhibiting or deleting specific genes or proteins, currently
ongoing.
- Primate studies showing ARGENT erythropoietin (Epo) production for
over 450 days using small-molecule Dimerizer Drugs(tm) to turn on
Epo gene expression featured at the Keystone Gene Therapy meeting.
Feasibility of long-term delivery of Epo by one-time or infrequent
administration of gene delivery vector followed by use of an oral
drug to induce protein production demonstrated.
- Six additional U.S. patents covering ARGENT gene regulation and
gene activation technologies issued. Pharmaceutical regulation of
fundamental cellular processes through drug-mediated clustering of
proteins and broad applications in genomics, stem cell therapy,
and gene therapy covered by expanding patent estate.
ARIAD Pharmaceuticals (www.ariad.com) is a leader in the discovery and development of proprietary platform technologies and small-molecule therapeutic products based on gene regulation and signal transduction. These enabling technologies distinguish the gene therapy, stem cell therapy, and protein therapy products being developed by the Company and also may be licensed to pharmaceutical and biotechnology companies for use in their research and product development programs. ARIAD also is developing orally administered small-molecule drugs to inhibit signal transduction pathways that are critically involved in major diseases.
Some of the matters discussed in this news release are forward-looking statements that involve risks and uncertainties, which include, but are not limited to, risks and uncertainties regarding the Company's preclinical studies, the ability of the Company to conduct clinical trials of its products and the success of such trials, as well as risks and uncertainties relating to economic conditions, markets, products, competition, intellectual property, services and prices, key employees, future capital needs, dependence on our collaborators and other factors under the heading "Cautionary Statement Regarding Forward-Looking Statements" in ARIAD's Annual Report on Form 10-K for the fiscal year ended December 31, 1999 filed with the Securities and Exchange Commission.
ARIAD PHARMACEUTICALS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended
March 31,
------------------------
2000 1999
Revenue: ------ ------
Research revenue $ 108,124 $ 4,582,897
Interest income 306,935 172,891
----------- ------------
Total revenue 415,059 4,755,788
----------- ------------
Operating expenses:
Research and development 2,898,648 8,510,816
General and administrative 977,119 730,247
Interest expense 61,665 105,781
----------- ------------
Total operating expenses 3,937,432 9,346,844
Equity in net loss of Genomics Center 338,039
----------- ------------
Net loss (3,522,373) (4,929,095)
Accretion on preferred stock 61,644
----------- ------------
Net loss attributable
to common stockholders $(3,522,373) $ (4,990,739)
=========== ============
Net loss per common share
(basic and diluted) $ (.15) $ (.23)
============ ============
Weighted average number
of shares of common
stock outstanding 23,722,439 21,963,809
ARIAD PHARMACEUTICALS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET INFORMATION
(Unaudited)
March 31, December 31,
2000 1999
--------- -----------
Cash and cash equivalents $25,089,521 $28,319,870
Net fixed assets 3,068,125 3,334,353
Other assets 6,572,856 12,581,790
----------- -----------
Total assets $34,910,502 $44,236,013
=========== ===========
Debt $ 2,800,000 $ 3,100,000
Other liabilities 3,136,317 5,998,126
----------- -----------
Total liabilities 5,936,317 9,098,126
Redeemable preferred stock 8,070,415
Stockholders' equity 28,974,185 27,067,472
----------- -----------
Total liabilities
and stockholders' equity $34,910,502 $44,236,013
=========== ===========
CONTACT: ARIAD Pharmaceuticals, Inc.
Jay LaMarche, 617/494-0400
or
Pearson Communications
Tom Pearson (for media)
610/407-9260
or
SmallCaps Online Group, LLC
Eytan Apter (for investors)
212/554-4158 |
