GZMO within a hair's breadth of lows, since the release of this earnings report a while ago. Burn rate up, suggesting the need for financing between one and two years from now. Meanwhile, not much has happened on the deal front. Anybody have thoughts on GZMO at these levels?
>>FRAMINGHAM, Mass., Mar 7, 2002 /PRNewswire-FirstCall via COMTEX/ -- Genzyme Corp. today reported that total revenues for Genzyme Molecular Oncology (Nasdaq: GZMO chart, msgs) for the fourth quarter of 2001 were $2.6 million, an increase from $1.5 million for the fourth quarter of 2000. For the year, total revenues were $6.6 million, up from $5.7 million reported a year ago. Revenue to Genzyme Molecular Oncology is derived primarily from research partnerships and its SAGE(TM) (Serial Analysis of Gene Expression) business.
Net loss allocated to Genzyme Molecular Oncology for the fourth quarter of 2001 was $7.6 million, or $0.46 per share, compared to a net loss of $5.2 million, or $0.33 per share for the fourth quarter of 2000. Net loss allocated to Genzyme Molecular Oncology for the full year in 2001 was $29.7 million, or $1.82 per share, compared to a net loss of $23.1 million, or $1.60 per share in 2000.
Expenditures on research and development for the fourth quarter of 2001 increased to $7.2 million, up from $5.1 million in the fourth quarter of 2000. For the year, research and development expense was $26.8 million, compared to $18.9 million a year ago. Genzyme Molecular Oncology's spending on internal research and development increased as a result of the progression of its five cancer vaccine clinical trials and the expansion of its antigen discovery and antiangiogenesis programs.
"We are making excellent progress in both our clinical and business programs, and expect to build even more momentum in the coming year through initiating three new clinical trials and securing new business deals," said Gail Maderis, president, Genzyme Molecular Oncology. "In just the past few months, we completed our first antibody development partnership, reported encouraging preliminary data from two clinical trials, garnered two major patent approvals, and transferred the rights to certain, non-strategic diagnostic assets. These events provide us with a consistent revenue stream and enough cash to fund operations into 2003."
The cash balance of Genzyme Molecular Oncology was significantly increased in a non-dilutive manner by the transfer last December of diagnostic rights to a number of cancer markers and several related licenses to Genzyme Genetics, a business unit of Genzyme General. Monetizing these non-core assets provides Genzyme Molecular Oncology with resources to fund its core therapeutics research and product development programs.
Genzyme Molecular Oncology ended the year with approximately $41 million in cash and marketable securities. Additional financing also is available through Genzyme Corporation's bank credit facility and an interdivisional financing arrangement with Genzyme General.
Antigen Discovery Progress
Genzyme Molecular Oncology strengthened its antigen discovery program substantially during the past year through the issuance of a patent covering a group of novel, melanoma peptides identified using the SPHERE(TM) platform and another patent directed to the SPHERE method itself.
SPHERE is a key component of Genzyme Molecular Oncology's discovery platform, allowing it to rapidly identify antigens. Candidates identified using SPHERE are believed to be more effective than the natural epitope in stimulating an immune response. In preclinical studies, peptides identified using SPHERE have been demonstrated to be 1,000 to 100,000 times more potent than the native epitope.
Genzyme Molecular Oncology's antigen discovery program also expanded its efforts in identifying both cellular and antibody targets in 2001. It continues to present cancer antigens for consideration to Purdue Pharma L.P., with whom it has a discovery and licensing agreement around tumor antigen discovery.
The broad collaboration with Purdue Pharma highlights the power and speed of Genzyme Molecular Oncology's technology platform and marks it as a leader in the antigen discovery arena. Building on this momentum, Genzyme Molecular Oncology plans to work with partners in expanding its program into infectious disease and autoimmune disorders.
One of these collaborations is with Bruce Walker, M.D., director of the Partners AIDS Research Center at Massachusetts General Hospital, around HIV/AIDS research. Dr. Walker is now analyzing optimized peptides identified by Genzyme Molecular Oncology that may be used in HIV vaccines. Because of its cancer focus, licensing will be the likely model used by Genzyme Molecular Oncology for developing and commercializing candidates for infectious and autoimmune diseases.
Clinical Trial Progress
Genzyme Molecular Oncology concluded the past year by presenting preliminary data from two of its five clinical trials at the annual American Society of Hematology conference. Early data was shared from an antigen- specific, ex vivo melanoma trial led by Frank Haluska, M.D., Ph.D., of Massachusetts General Hospital and Dana-Farber Partners Cancer Care, and a patient-specific breast cancer trial led by David Avigan, M.D., of Beth Israel Deaconess Medical Center. Both studies demonstrated clinical and immunologic response among some of its patients.
Genzyme Molecular Oncology plans to complete its five ongoing clinical vaccine trials this year, and to advance research and preclinical efforts in its other cancer vaccine and antiangiogenesis programs. Data from these vaccine trials will be used to determine how best to continue moving towards product commercialization. Additionally, it expects to initiate three new cancer vaccine clinical trials within the next year, including two additional patient-specific vaccine trials that use an electrofusion production method, and a melanoma trial using the first group of SPHERE peptides.
Antiangiogenesis Progress
Genzyme Molecular Oncology's program in antiangiogenesis progressed well in 2001 as work advanced on 46 of the novel tumor endothelial markers (TEMs) identified using SAGE. TEMs are genes uniquely involved with tumor angiogenesis. Progress included cloning and characterizing the TEMs, validating their expression in a wide variety of tumor types, and initiating pattern analysis to understand the impact of various antiangiogenic drugs on these markers.
During the fourth quarter, Genzyme Molecular Oncology entered into a collaboration with the pharmaceutical division of Kirin Brewery of Japan to develop and commercialize fully human antibodies for use as therapeutic agents in antiangiogenesis and cancer drug delivery vehicles targeted at the vasculature.
The terms of the agreement with Kirin create a new paradigm for the value of proprietary targets in antibody collaborations. Genzyme Molecular Oncology received an up-front fee from Kirin and will receive full research support for a minimum of two years. Additionally, Genzyme Molecular Oncology will be paid for achieving certain research milestones during this period.
For antibody products that both parties agree to move forward, development expenses and worldwide profits will be shared equally. Marketing rights will be split between the two, with Genzyme Molecular Oncology receiving exclusive rights to North America and Kirin obtaining rights in Asia. Genzyme Molecular Oncology will be the primary marketing party in Europe with Kirin granted an option for co-promotion.
Genzyme Molecular Oncology, a division of Genzyme Corp., is working to develop a new generation of cancer products focusing on cancer vaccines and angiogenesis inhibitors. It is shaping these new therapies through the integration of its genomics, gene and cell therapy, small-molecule drug discovery, and protein therapeutic capabilities. It is also leveraging this valuable technology externally through licensing and development partnerships both inside and outside the cancer field.
This press release contains forward-looking statements, including the statements regarding: Genzyme Molecular Oncology's ability to initiate three additional clinical trials and complete its five ongoing clinical trials in the coming year; its ability to advance its research and preclinical efforts; its ability to enter into new partnerships, particularly in the areas of infectious disease and autoimmune disorders; and its projected cash needs. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in these forward- looking statements. These risks and uncertainties include, among other things: the content and timing of decisions made by the FDA and other regulatory authorities; the ability to attract, enroll and successfully treat patients in clinical trials; the ability to manufacture sufficient supply of product to conduct preclinical and clinical studies; the ability to identify suitable partners and negotiate definitive collaboration or licensing agreements on acceptable terms; actual 2002 financial results, including without limitation revenues, operating expenses, interest income and the availability of additional funding; and the factors contained under the caption "Factors Affecting Future Operating Results" in Exhibit 99.2 to Genzyme Corporation's 2000 Annual Report on Form 10-K. Genzyme Molecular Oncology Division common stock is a series of common stock of Genzyme Corporation. Therefore, holders of Genzyme Molecular Oncology Division common stock are subject to all of the risks and uncertainties described in those reports. We caution investors not to place undue reliance on the forward- looking statements contained in this press release. These statements speak only as of the date of this press release, and Genzyme undertakes no obligation to update or revise the statements, except as may be required by law.
Genzyme(R) is a registered trademark, and SAGE(TM) and SPHERE(TM) are trademarks of Genzyme Corporation. All rights reserved.
There will be a conference call today at 1:00 p.m. ET to discuss Genzyme Molecular Oncology's fourth quarter financial results. If you would like to participate in the call, please dial 913-981-5517. A replay of this call will be available from 4:00 p.m. ET through midnight on March 14 by dialing 719- 457-0820. Please reference reservation number 463893. This call will also be webcast live over the Internet at www.genzyme.com/ir/events.htm
Genzyme Corporation will report First-quarter 2002 financial results on April 17. If you would like to participate in any of these calls, please dial 913-981-5518 at 11:00 a.m. for Genzyme General, at 1:00 p.m. for Genzyme Molecular Oncology, and 3:00 p.m. for Genzyme Biosurgery. Please refer to www.genzyme.com one week prior to the financial reporting date for any updates to this information. This call will also be webcast live over the Internet at www.genzyme.com/ir/events.htm
If you are unable to listen to the call, a replay will be available approximately 2 hours after the end of each call and will be available until April 24 midnight. You can access the replay by dialing 719-457-0820 and entering passcode 754726 for Genzyme General, passcode 436909 for Genzyme Molecular Oncology and passcode 445377 for Genzyme Biosurgery.
Genzyme's press releases and other company information are available at www.genzyme.com and by calling Genzyme's investor information line at 1-800-905-4369 within the United States or 1-703-797-1866 outside the United States.
Media Contact Investor Contact
Maria Foley Catherine Forte
617-591-5690 617-591-5881
GENZYME MOLECULAR ONCOLOGY (A Division of Genzyme Corporation)
Combined Statements of Operations
(Unaudited, amounts in thousands, except per share amounts)
Three Months Ended Year Ended
December 31, December 31,
2001 2000 2001 2000
Total revenues $2,647 $1,518 $6,562 $5,671
Operating costs and expenses:
Cost of revenues 1,106 527 2,803 826
Selling, general and
administrative 2,033 1,562 7,552 5,851
Research and development 7,203 5,136 26,813 18,908
Amortization of intangibles - - - 5,420
Total operating costs
and expenses 10,342 7,225 37,168 31,005
Operating loss (7,695) (5,707) (30,606) (25,334)
Other income (expenses):
Interest income 92 549 945 1,211
Interest expense (16) (14) (57) (187)
Total other income (expenses) 76 535 888 1,024
Loss before income taxes (7,619) (5,172) (29,718) (24,310)
Tax benefit - - - 1,214
Division net loss $(7,619) $(5,172) $(29,718)$(23,096)
Net loss per share of Molecular
Oncology Stock -
basic and diluted $(0.46) $(0.33) $(1.82) $(1.60)
Weighted average shares
outstanding 16,727 15,778 16,350 14,446
Condensed Combined Balance Sheets
(Unaudited, amounts in thousands)
December 31 December 31
2001 2000
Cash and all marketable securities $41,135 $30,151
Other current assets 1,165 357
Equipment, net 119 244
Total assets $42,419 $30,752
Current liabilities $13,493 $ 8,408
Noncurrent liabilities 2,113 2,818
Division equity 26,813 19,526
Total liabilities and division equity $42,419 $30,752<<
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Cheers, Tuck |
