Aradigm Corporation Reports Second Quarter and Six Month 2003 Financial Results
Wednesday July 23, 8:06 am ET
HAYWARD, Calif., July 23 /PRNewswire-FirstCall/ -- Aradigm Corporation (Nasdaq: ARDM - News) today announced financial results for the second quarter and six months 2003 ended June 30, 2003.
Contract revenues for the quarter were $9.4 million, compared to $7.3 million for the same period in 2002. Revenues were primarily derived from the collaboration agreement with Novo Nordisk A/S to develop the AERx® insulin Diabetes Management System (iDMS). Total operating expenses for the second quarter were $16.8 million, compared to $17.4 million for the same quarter 2002. The Company reported net loss applicable to common shareholders for the second quarter 2003 of $7.4 million, or $0.15 per share, compared with a loss of $10.0 million, or $0.34 per share, for the same period in 2002.
"During the second quarter, the company expanded its needle-free delivery offerings with the acquisition of the Intraject® technology," said Richard Thompson, Chairman and Chief Executive Officer of Aradigm. "The synergies between Intraject and our AERx platform allow Aradigm to capitalize on its leading position in liquid based drug delivery and experience in product development while offering drug discovery and biotechnology companies two innovative technologies to meet their drug delivery needs."
Contract revenues for the six months ended June 30, 2003 were $17.1 million, compared with $15.4 million for the same period in 2002. Total operating expenses for the six months ended June 30, 2003 were $32.5 million, compared with $34.2 million for the same period in 2002. The net loss for the six months ended June 30, 2003 was $15.3 million, or $0.35 per share, compared with a net loss of $18.5 million, or $0.62 per share, for the same period in 2002.
Dr. Bryan Lawlis, Aradigm's President and Chief Operating Officer, commented, "In line with our previously announced plan to streamline operations and to provide additional fiscal flexibility going forward, the company has completed a reduction in workforce. With a significant part of the development of the AERx platform concluded and the technology transfer portion of the Intraject program completed on time and on budget, it is now strategically important for us to focus our resources on moving the iDMS platform to market while initiating the development portion of the Intraject program all in a timely manner. This reduction in force has affected fewer than 40 regular employees."
As of June 30, 2003, cash, cash equivalents, and all investments totaled approximately $28.2 million.
Quarterly Highlights
-- In May, the company announced a strategic step in building its
needle-free drug delivery platform with the acquisition of the
Intraject technology from Weston Medical. This technology
consisting of a pre-filled, pen-sized, single-use disposable system,
delivers drugs and biologics comfortably to the subcutaneous layer of
the skin. In this acquisition, Aradigm obtained the technology,
intellectual property including patents and manufacturing equipment for
approximately $2 million. Recently, the technology transfer portion of
the Intraject acquisition was completed which now allows Aradigm to
move forward in its internal testing prior to initiating clinical
trials.
-- In June, Dr. Bryan Lawlis added the title of President to his current
position of Aradigm's Chief Operating Officer. This promotion is in
line with Dr. Lawlis' increased handling of the day-to-day operations
and the company's focus on commercialization.
-- In June, Mr. Bobba Venkatadri joined Aradigm in the newly created
position of Senior Vice President of Operations. Mr. Venkatadri brings
over 30 years of worldwide executive leadership related to
pharmaceutical and biotechnology product manufacturing. He will oversee
all manufacturing operations for the company.
-- At the 63rd Annual Meeting of the American Diabetes Association in New
Orleans, Aradigm's partner, Novo Nordisk presented three abstracts of
new data from the Phase 2b clinical trial of the AERx Diabetes
Management System. These abstracts showed that the system did not
impact lung function, demonstrated a high rate of patient compliance
and elicited positive physician reaction to some of the system's unique
features.
Conference Call
The company will host a conference call and question and answer session at 11:00 a.m. Eastern Time, 8:00 a.m. Pacific Time today to discuss these financial results. Dial toll-free 1-800-753-6335 to access the conference call. International callers dial +1-706-643-1675. The event webcast can be found under the investor relations section of: www.aradigm.com. The webcast and audio replay of the conference call will be available following the call, which can be accessed on www.aradigm.com or by dialing toll-free 1-800-642-1687. International callers should dial +1-706-645-9291. The replay passcode is 1685545.
Aradigm is working to improve the quality of life for patients through the development of its innovative needle-free drug delivery platforms. The Company's AERx® advanced pulmonary delivery platform and its Intraject® needle-free injector system provide leading pharmaceutical and biotechnology partners with effective drug delivery solutions. Aradigm's technologies both use liquid drug formulations to deliver drugs to the targeted area of either the lung, or the systemic circulation. The company's most advanced product is in Phase 3 clinical trials for the treatment of diabetes in a partnership with Novo Nordisk, a world leader in diabetes care. More information about Aradigm can be found at www.aradigm.com.
Except for the historical information contained herein, this news release contains forward-looking statements that involve risk and uncertainties, including clinical results, the timely availability and acceptance of new products, the impact of competitive products and pricing, and the management of growth, as well as the other risks detailed from time to time in Aradigm Corporation's Securities and Exchange Commission (SEC) Filings, including the company's Annual Report on Form 10-K as amended, and quarterly reports on Form 10-Q.
NOTE: AERx, AERx Essence and Intraject are registered trademarks of Aradigm Corporation.
ARADIGM CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
(IN $000'S)
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
2003 2002 2003 2002
(UNAUDITED) (UNAUDITED)
CONTRACT REVENUES - FROM
RELATED PARTIES $9,255 $6,558 $16,824 $14,157
CONTRACT REVENUES - OTHER 123 737 244 1,256
TOTAL CONTRACT REVENUES 9,378 7,295 17,068 15,413
OPERATING EXPENSES:
RESEARCH AND DEVELOPMENT 14,001 14,588 $27,000 28,901
GENERAL AND ADMINISTRATIVE 2,844 2,809 $5,513 5,267
TOTAL OPERATING EXPENSES 16,845 17,397 32,513 34,168
LOSS FROM OPERATIONS (7,467) (10,102) (15,445) (18,755)
OTHER INCOME (EXPENSE):
INTEREST INCOME 86 210 $194 501
INTEREST EXPENSE AND OTHER (39) (84) $(95) (250)
TOTAL OTHER INCOME
(EXPENSE) 47 126 99 251
NET LOSS $(7,420) $(9,976) $(15,346) $(18,504)
BASIC AND DILUTED NET LOSS
PER SHARE: $(0.15) $(0.34) $(0.35) $(0.62)
SHARES USED IN COMPUTING
BASIC AND DILUTED NET LOSS
PER SHARE 51,144 29,723 43,440 29,634
ARADIGM CORPORATION
CONDENSED BALANCE SHEETS
(IN $000'S)
JUNE 30, DECEMBER 31,
2003 2002
UNAUDITED
ASSETS
CURRENT ASSETS:
CASH, CASH EQUIVALENTS &
SHORT-TERM INVESTMENTS $28,229 $29,890
RECEIVABLES 167 282
OTHER CURRENT ASSETS 1,514 1,593
TOTAL CURRENT ASSETS 29,910 31,765
PROPERTY AND EQUIPMENT, NET 64,207 63,233
NOTES RECEIVABLE FROM OFFICERS 332 169
LONG TERM INVESTMENTS 1,553
OTHER ASSETS 399 409
TOTAL ASSETS $94,848 $97,129
LIABILITIES, REDEEMABLE
CONVERTIBLE PREFERRED STOCK
AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
ACCOUNTS PAYABLE $1,010 $1,951
ACCRUED CLINICAL AND COST
OF OTHER STUDIES 207 291
ACCRUED COMPENSATION 3,368 2,195
DEFERRED REVENUE 8,909 10,682
OTHER ACCRUED LIABILITIES 648 407
CURRENT PORTION OF CAPITAL LEASE
OBLIGATIONS 992 1,753
TOTAL CURRENT LIABILITIES 15,134 17,279
NONCURRENT PORTION OF DEFERRED
REVENUE 5,142 6,170
NONCURRENT PORTION OF CAPITAL
LEASE OBLIGATIONS 73 497
NONCURRENT PORTION OF DEFERRED
RENT 1,216 1,108
REDEEMABLE CONVERTIBLE PREFERRED
STOCK 27,499 30,665
SHAREHOLDERS' EQUITY 45,784 41,410
TOTAL LIABILITIES, REDEEMABLE
CONVERTIBLE PREFERRED
STOCK & SHAREHOLDERS' EQUITY $94,848 $97,129
CONTACT: Media, Chris Keenan of Aradigm, +1-510-65-9370; or Investors, Joe Dorame of RCG Capital Markets Group, Inc., +1-480-675-0400, for Aradigm.
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Source: Aradigm Corporation
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