Cell Genesys Reports Third Quarter Results - Ends Quarter With $220 Million in Cash
FOSTER CITY, Calif., Oct. 22 /PRNewswire/ -- Cell Genesys, Inc. (Nasdaq: CEGE - news) reported a net loss of $22.4 million or $0.64 per share for the quarter ended September 30, 2001. This compares with a net loss of $0.3 million or $0.01 per share in the same quarter of 2000. The increased net loss is due primarily to a one-time charge of $18.0 million or $0.52 per share relating to the acquisition of Calydon, Inc. -- an acquisition which added a third product platform to Cell Genesys' deep pipeline of cancer product candidates. Cell Genesys ended the quarter with approximately $220 million in cash, cash equivalents and short-term investments.
Revenues for the quarter ended September 30, 2001 were $4.6 million, compared with $5.1 million in the comparable period of 2000. Research and development costs were $12.4 million in the third quarter ended September 30, 2001, compared with $7.5 million for the comparable period of 2000 -- an increase which can be attributed to the company's expanding clinical stage product programs for cancer.
``Cell Genesys has exceptional financial resources of nearly a half billion dollars divided approximately equally between cash and the value of our equity interest in Abgenix, our former subsidiary,'' stated Stephen A. Sherwin, M.D., chairman and chief executive officer of Cell Genesys. ``These financial assets will continue to provide the foundation for the development and commercialization of our deep pipeline of cancer products which includes three potential candidates for Phase III trials during the next 12 to 18 months.''
Cell Genesys Highlights for the Third Quarter of 2001:
* Completed the acquisition of Calydon, Inc., a private biotechnology company developing oncolytic virus therapies for cancer, for approximately $17 million in Cell Genesys stock. The acquisition provided Cell Genesys with a third product platform in addition to cancer vaccines and cancer gene therapies as well as a late stage product, CG7060, for early stage prostate cancer which could enter a Phase III clinical trial within the next 18 months.
* Reported in the journal, Cancer Research, that CG8900, an oncolytic virus therapy engineered to target and destroy liver cancer cells, demonstrated significant synergistic antitumor activity in a mouse model when used in combination with doxorubicin, a chemotherapeutic agent commonly used in the treatment of liver cancer.
* Announced the expansion of the executive management team with the appointment of Peter K. Working, Ph.D. as vice president of research and development and the promotion of Joseph J. Vallner, Ph.D. to the position of president and chief operating officer. Also announced the election of Thomas E. Shenk, Ph.D., a world-renowned expert in virology, to the company's board of directors.
*Announced that the company exclusively licensed its proprietary lentiviral gene delivery technology to Invitrogen Corporation for commercialization in the research market. Under the agreement, Cell Genesys will receive royalties on worldwide sales of kits, products and services employing lentiviral vectors as well as a share of any sublicense payments.
* Reported in the journal, Circulation Research, that preclinical studies of p27/p16 gene therapy demonstrated in porcine models potent inhibition of restenosis, a complication of angioplasty treatment for coronary artery disease. Gene therapy with p27/p16, a novel cell cycle inhibitor gene, is also being evaluated in preclinical antitumor models.
Cell Genesys is focused on the development and commercialization of innovative therapeutic products for cancer based on gene therapy technologies. The company is pursuing three cancer product platforms -- GVAX® cancer vaccines, oncolytic virus therapies and in vivo cancer gene therapies. Clinical trials of the company's GVAX® vaccines are under way in prostate cancer, lung cancer, pancreatic cancer and myeloma with plans to initiate a trial for acute leukemia later in 2001. Clinical trials of oncolytic virus therapies include CG7060 and CG7870 in prostate cancer. Preclinical stage programs include gene therapies and oncolytic virus therapies for multiple types of cancer as well as gene therapy for hemophilia. Cell Genesys' majority-owned subsidiary, Ceregene, is focused on gene therapies for neurologic disorders. Cell Genesys also continues to hold a 10.5 percent equity interest in its former subsidiary, Abgenix, an antibody products company. For additional information, please visit the company's website at www.cellgenesys.com.
Cell Genesys will host its quarterly conference call to discuss events that occurred during the third quarter at 11:30 a.m. EDT on Tuesday, October 23, 2001. Investors may listen to the webcast of the conference call live on Cell Genesys' web site. A replay of the webcast will be available for two weeks following the call. Alternatively, investors may listen to a replay of the call by dialing 800-633-8284 from locations in the U.S. and 858-812-6440 from outside the U.S. The call-in replay will be available for 48 hours following the call, and please refer to reservation number 19775177.
Statements made herein, other than statements of historical fact, including statements about the application of the company's financial assets, progress reports and plans for clinical trials, the company's progress and results and timing of clinical trials and preclinical programs, marketability of potential products and therapies and the nature of product pipelines are forward-looking statements and are subject to a number of uncertainties that could cause actual results to differ materially from the statements made, including risks associated with the success of research and development programs, clinical trials, the regulatory approval process for clinical trials, competitive technologies and products, patents, and the need for additional financings. For information about these and other risks which may affect Cell Genesys, please see the company's Annual Report on Form 10-K dated April 2, 2001 as well as Cell Genesys' reports on Form 10-Q and 8-K and other reports filed from time to time with the Securities and Exchange Commission.
Contact: Jennifer Cook Williams
Associate Director
Corporate Communications
650-425-4542
SELECTED FINANCIAL INFORMATION
(unaudited)
STATEMENTS OF OPERATIONS
Three months ended Nine months ended
(in thousands except September 30, September 30,
per share data) 2001 2000 2001 2000
Revenue $4,635 $5,112 $14,646 $14,697
Operating expenses:
Research and development 12,362 7,448 34,122 21,624
General and administrative 2,786 1,860 8,302 5,090
Charge for purchased
in-process technology 18,042 -- 18,042 --
Total operating expenses 33,190 9,308 60,466 26,714
Gain on sale of stock of Abgenix -- -- -- 190,236
Interest and other income 2,857 3,860 13,723 9,825
Interest expense (96) (75) (222) (318)
Net income (loss) before
income tax and cumulative
effect of change
in accounting (25,794) (411) (32,319) 187,726
Income (loss) attributed to
minority interest 68 -- 67 --
Income (loss) before income
tax and cumulative effect
of change in accounting (25,726) (411) (32,252) 187,726
Benefit (provision)
for income tax 3,342 103 4,973 (51,991)
Net income (loss) before
cumulative effect of
change in accounting (22,384) (308) (27,279) 135,735
Cumulative effect of change
in accounting principle,
net of tax -- -- -- (6,460)
Net income (loss) $(22,384) $(308) $(27,279) $129,275
Basic income (loss)
per common share before
cumulative effect of
change in accounting
principle $(0.64) $(0.01) $(0.79) $4.04
Cumulative effect
of change in accounting
principle -- -- -- (0.19)
Basic income (loss) per
common share $(0.64) $(0.01) $(0.79) $3.85
Diluted income (loss)
per common share before
cumulative effect of
change in accounting
principle $(0.64) $(0.01) $(0.79) $3.68
Cumulative effect of
change in accounting
principle -- -- -- (0.18)
Diluted income (loss)
per common share $(0.64) $(0.01) $(0.79) $3.50
Weighted average shares
of common stock outstanding
- basic 34,836 33,895 34,478 33,580
Weighted average shares
of common stock outstanding
- diluted 34,836 33,895 34,478 36,905
SELECTED FINANCIAL INFORMATION
(unaudited)
CONDENSED BALANCE SHEETS
(in thousands)
09/30/2001 12/31/2000
Cash, cash equivalents and
short-term investments $219,979 $259,647
Investment in Abgenix common stock 203,259 528,858
Other current assets 2,095 482
Property and equipment, net 22,095 4,439
Other assets 1,626 290
Total assets $449,054 $793,716
Current liabilities $98,288 $239,002
Long-term obligations 1,260 1,350
Minority interest in equity of subsidiary 316 --
Series B preferred stock 17,185 17,185
Stockholders' equity 332,005 536,179
Total liabilities and stockholders' equity $449,054 $793,716
SOURCE: Cell Genesys, Inc. |
