THE WOODLANDS, Texas, Oct. 26 /PRNewswire/ -- Lexicon Genetics Incorporated (Nasdaq: LEXG - news), a functional genomics and drug discovery company, today announced financial results for the three months and nine months ended September 30, 2000.
For the third quarter of 2000, total revenues increased 691% to $5,614,160, as compared with $709,312 for the same period in 1999. For the nine months ended September 30, 2000, total revenues were $11,535,689, versus $2,597,765 for the comparable period in 1999. The conclusion of Lexicon's 1997 collaboration with the Merck Genome Research Institute accounted for $4.1 million in revenues recognized during the third quarter. The additional increase in revenue primarily resulted from activity under functional genomics research collaborations with pharmaceutical companies and academic institutions and database subscription and technology licensing revenues.
Total operating expenses for the third quarter, excluding stock based compensation, increased 63% to $7,455,396, as compared to $4,578,923 for the same period in 1999. For the nine months ended September 30, 2000 total operating expenses, excluding stock based compensation, were $17,980,213 versus $12,771,006 for the comparable period in 1999. The increase in operating expenses reflects the growth of Lexicon's efforts to industrialize research, development and analysis of knockout mice for drug discovery. Operating expenses include the addition of 113 employees in the first nine months of 2000 to total 221. Of the new employees hired, 20 hold a Ph.D., 3 hold an M.D., and 14 hold other advanced degrees. Of the new employees that joined in 2000, 86 were added to research and development and 27 to overall business and administrative operations.
For the third quarter, the Company reported net interest income of $3,350,655, as compared to $39,691 for the same period in 1999. The increase in net interest income is due to interest earned on proceeds from the Company's initial public offering in April 2000.
Including the non-cash stock based compensation charges relating to employee stock option grants, the Company reported a third quarter 2000 net loss of $1,539,880, or $0.03 per share, as compared with a net loss of $3,829,920, or $0.10 per share, for the same period in 1999. For the nine months ended September 30, 2000, the Company reported a net loss of $18,474,683, or $0.42 per share, versus a net loss of $9,822,847, or $0.26 per share, for the comparable period in 1999. Excluding the non-cash stock based compensation charges, the net earnings for the three and nine months ended September 30, 2000 would have been $1,509,419, or $0.03 per share, and a net loss of $282,771, or $0.01 per share, respectively.
``We had an extremely productive quarter and are pleased to see our continued revenue growth as we systematically industrialize our research and business structures within our organization,'' stated Julia P. Gregory, Executive Vice President and Chief Financial Officer. ``We do not expect to show profitability, excluding non-cash stock based compensation, in the near term as we continue research and operational expansion.''
Third Quarter Highlights:
Two Drug Discovery Collaborations
* Lexicon announced its drug discovery alliance with Abgenix to discover
novel antibody drugs using Lexicon's functional genomics technologies
and Abgenix's technology for generating fully human antibodies.
* Lexicon established a joint research collaboration with Arena
Pharmaceuticals to discover novel drug candidates that target an
important class of receptors called G protein-coupled receptors (GPCRs),
using Lexicon's proprietary functional genomics technologies and Arena's
CART (TM) technology.
Major LexVision (TM) Collaboration
* Lexicon launched its first LexVision collaboration with Bristol-Myers
Squibb Company. Under the agreement, Bristol-Myers Squibb will have
access to Lexicon's LexVision database and our OmniBank library for the
discovery of small molecule drugs. Lexicon could receive between $15
million and $25 million in access and delivery fees, in addition to
milestones and royalties on products Bristol-Myers Squibb develops using
Lexicon's technology. The LexVision database contains gene function
information derived from Lexicon's gene knockout platform. Scientists
use mouse knockouts -- in which genes are deleted, or "knocked out," of
the mouse genome -- to determine which human gene products are valid
targets for the discovery and development of new medicines.
Functional Genomics Collaborations
* Lexicon, The Rockefeller University and The Scripps Research Institute
formed a functional genomics collaboration for the development of a
series of gene specific knockouts with potential pharmaceutical
relevance for schizophrenia.
* Lexicon formalized entry into the Japanese drug discovery market by
announcing a collaboration with Oriental Yeast Co. (OYC) of Tokyo, Japan
to develop a unique web interface in the Japanese language that will
allow researchers to access OmniBank (TM), the world's largest library
of over 90,000 knockout mouse clones.
* Lexicon and the Howard Hughes Medical Institute (HHMI) agreed on terms
that will allow HHMI investigators to obtain custom knockout mice as
well as mice developed using mouse clones from a portion of Lexicon's
OmniBank database.
Conclusion of Merck Collaboration
* In September, Lexicon announced the conclusion of its 1997 agreement
with the Merck Genome Research Institute, under which MGRI had provided
funding for the development of Lexicon's proprietary gene trapping
process for the production of Lexicon's OmniBank library of knockout
mouse clones for functional genomics research. Lexicon attained
significant achievements in the past year: widespread use of knockout
mice from OmniBank for drug discovery by both industry and the academic
research community; a major milestone achievement of altering one-third
of the mouse genome and the recent issuance of a patent to Lexicon that
broadly covers its gene trapping technology. With these important
accomplishments, MGRI and Lexicon agreed to bring the agreement to a
conclusion.
Positive-Negative Selection Sublicense
* Lexicon granted a non-exclusive sublicense to Biogen, Inc. for use of
certain aspects of Lexicon's positive-negative selection technology for
the generation of knockout mice. Current sublicensees under the
positive-negative selection and/or isogenic DNA patents include American
Home Products, Amgen Inc., Bristol-Myers Squibb Company, DuPont
Pharmaceuticals Company, Genentech, Inc., Ligand Pharmaceuticals,
Millennium Pharmaceuticals, Inc., Pfizer, Inc., Roche Bioscience and
Schering-Plough Research Institute.
Milestones for 2001
The following statements are based on current expectations. These statements are forward-looking, and actual results may differ materially. These statements do not include the potential impact of any mergers, acquisitions or other business combinations that may be completed after September 30, 2000.
* Continue expansion of the OmniBank library.
* Develop additional pharmaceutical partnerships for the LexVision drug
discovery program.
* Establish functional genomics collaborations with pharmaceutical and
biotechnology companies and leading academic centers.
* Drug discovery alliance progress.
* Internal drug discovery progress.... |
