Essential Therapeutics (Formerly Microcide Pharmaceuticals) Reports 3rd Quarter 2001 Financial Results
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Essential Therapeutics (Formerly Microcide Pharmaceuticals) Reports 3rd Quarter 2001 Financial Results
WALTHAM, Mass., Oct. 31 /PRNewswire/ -- Essential Therapeutics, Inc. (Nasdaq: ETRX - news; formerly Microcide Pharmaceuticals, Inc.) today announced financial results for the third quarter ended September 30, 2001. The financial results represent the financial position of Essential Therapeutics as of and for the period ended September 30, 2001, without giving effect to the merger of Microcide Pharmaceuticals with The Althexis Company or to the $60 million private equity funding, which were completed on October 24, 2001.
Total revenues were $2.9 million in the third quarter of 2001 as compared to $1.5 million in the third quarter of 2000. The increase in total revenues was due primarily to new revenues from research and license agreements with units of Johnson & Johnson, and increased research funding from Schering-Plough Animal Health. Revenues from Johnson & Johnson included a milestone payment received during the quarter for achievement of certain development goals relating to the Company's pre-clinical research to develop an orally-active, novel cephalosporin. The increase in revenues was partially offset by the conclusion of funded research with Pfizer and Daiichi at the end of the first quarter of 2001. Operating expenses remained flat at $5.2 million for the third quarters of 2001 and 2000, respectively. Research and development expenses increased for planned contract research services related to the Company's lead optimization programs while general and administrative expenses decreased primarily due to reductions in personnel-related costs. Net loss for the third quarter of 2001 was $2.3 million or $0.20 per share as compared to $3.5 million or $0.31 per share in the third quarter of 2000.
For the first nine months of 2001, total revenues were $7.4 million as compared to $4.3 million in the first nine months of 2000. The increase in revenues from the Johnson & Johnson and Schering-Plough Animal Health research and license agreements offset a reduction in research revenues from Pfizer and Daiichi. Operating expenses increased from $15.3 million in the first nine months of 2000 to $16.2 million in the first nine months of 2001, primarily as a result of higher research and development expenses for planned contract research services, and higher costs for outside services. Net loss for the first nine months of 2001 was $8.3 million or $0.73 per share as compared to a net loss of $10.6 million or $0.94 per share in the first nine months of 2000.
At September 30, 2001, the Company's cash and cash equivalents were $7.5 million.
On October 24, 2001, Microcide Pharmaceuticals merged with Althexis, changed its name to Essential Therapeutics, Inc. and completed a $60 million private placement of preferred stock. In connection with the financing, Essential Therapeutics expects to incur a non-cash charge of approximately $23.8 million, reflecting the discount associated with the preferred stock sale in the fourth quarter of 2001. Additionally, Essential Therapeutics expects to incur a non-cash charge of approximately $13.9 million relating to acquired in-process research and development in the fourth quarter of 2001.
The statements contained in this press release which are not historical facts may be deemed to contain forward-looking statements. Actual results may differ materially from those expressed or implied in any forward-looking statement as a result of certain risks and uncertainties. There is no assurance that any compounds discovered will successfully proceed through pre-clinical development and clinical trials, obtain requisite regulatory approvals for marketing or result in a commercially useful product. There is no assurance that the Company will successfully continue existing corporate collaborations or enter into further collaborations with respect to any of its internally funded research programs or that current collaborators will elect to proceed through the various stages of clinical development as currently anticipated or on the same schedule as we would proceed if we were conducting such trials independently. For a discussion of other risks and uncertainties affecting Essential Therapeutics' business, see Microcide Pharmaceuticals' annual report on Form 10-K/A for the year ended December 31, 2000 and quarterly report on Form 10-Q for the quarter ended June 30, 2001. Actual results and timing of certain events could differ materially from those indicated in the forward-looking statements as a result of these or other factors.
CONTACT: Mark Skaletsky, Chairman and Chief Executive Officer, 781-647-5554, ext. 206, or Paul Mellett, Senior Vice President and Chief Financial Officer, 781-647-5554, ext. 213, both of Essential Therapeutics, Inc.
Essential Therapeutics, Inc.
Condensed Statements of Operations (A)
(unaudited)
(in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
2001 2000 2001 2000
Revenues:
Research revenues $1,030 $1,454 $3,761 $4,108
License fees and
other revenues 1,893 50 3,677 150
Total revenues 2,923 1,504 7,438 4,258
Operating expenses:
Research and
development 4,201 3,985 12,678 12,154
General and
administrative 1,045 1,242 3,508 3,167
Total operating
expenses 5,246 5,227 16,186 15,321
Loss from operations (2,323) (3,723) (8,748) (11,063)
Interest and other
income, net 69 210 406 679
Loss before cumulative
effect of change
in accounting
principle (2,254) (3,513) (8,342) (10,384)
Cumulative effect of
change in accounting
principle -- -- -- (233)
Net loss $(2,254) $(3,513) $(8,342) $(10,617)
Basic and diluted
net loss per share:
Loss before cumulative
effect of change
in accounting
principle $(0.20) $(0.31) $(0.73) $(0.92)
Cumulative effect of
change in accounting
principle -- -- -- (0.02)
Net loss per share $(0.20) $(0.31) $(0.73) $(0.94)
Weighted-average shares
used in basic and
diluted net loss per
share 11,519 11,354 11,497 11,292
September 30,
2001
Cash and cash equivalents $7,539
Total assets 14,465
Notes payable - current and long-term portions 724
Stockholders' equity 7,245
(A) These financial statements represent the financial position of
Essential Therapeutics without giving effect to the merger of
Microcide Pharmaceuticals with Althexis or to the $60 million private
equity funding, which were completed on October 24, 2001.
SOURCE: Essential Therapeutics, Inc. |
