NEW HAVEN, Conn., April 25 /PRNewswire-FirstCall/ -- CuraGen Corporation (Nasdaq: CRGN - news), an integrated, genomics-based pharmaceutical company, today reported financial results for the first quarter, which ended on March 31, 2002.
During the first quarter of 2002 revenue decreased 16% to $4.8 million, as compared to $5.7 million for the same period in 2001. Research and development expenditures increased 66% to $20.1 million during the first quarter of 2002, as compared to $12.1 million for the same period in 2001. CuraGen's net loss for the first quarter of 2002 was $19.6 million or $0.40 per common share, as compared to $5.4 million or $0.11 per common share for the same period in 2001.
As of March 31, 2002, CuraGen had available cash resources and short-term investments of approximately $478 million, or $9.80 per common share.
``Throughout the first quarter of 2002, we continued making substantial investments and advancements in CuraGen's proprietary discovery and preclinical stage drug pipeline. Our scientists have made extensive progress in advancing the Company's research programs over the past several months and are continuing to build a robust discovery stage and preclinical pipeline that we anticipate will provide significant future returns,'' stated Jonathan M. Rothberg, Ph.D., Founder, Chairman, and CEO of CuraGen Corporation. ``Our strategy of establishing drug development alliances on a shared risk and reward basis is proving very successful with our existing strategic partners, and we are aggressively pursuing additional strategic alliances to advance our small molecule drug targets. We now anticipate providing details of our progress in establishing another strategic small molecule development alliance over the next six to twelve months,'' added Dr. Rothberg.
Commenting on CuraGen's developing drug pipeline, Henri Lichenstein, Ph.D., Director of Drug Development at CuraGen Corporation stated, ``At CuraGen, we have implemented a systematic preclinical validation approach that is enabling us to select only the most promising candidates for advancement into clinical trials. Our experienced scientific and management teams believe that rigorous preclinical testing, combined with competitive analysis, will result in the selection of high quality IND candidates. This process may ultimately save time, significantly improve the odds for success in clinical development, and potentially reduce costly, later-stage clinical failures. We are applying this level of scientific rigor to our pipeline and we have revised our timetable for submitting CuraGen's first IND. We now anticipate submitting our initial IND within the next six to twelve months.''
CuraGen scientists are evaluating a broad pipeline of discovery and preclinical stage drug candidates. Company scientists have selected and advanced to late-stage preclinical status a lead protein therapeutic candidate with multiple potential disease indications. The ongoing focus of CuraGen's efforts on this protein will be to finalize its proper formulation and to complete GMP manufacturing to supply clinical trials.
First Quarter 2002 Significant Accomplishments
Advancing CuraGen's Protein, Antibody, and Small Molecule Drug Pipeline
* CuraGen scientists discovered a gene (CG57067) that codes for a protein
(designated as Angioarrestin) capable of inhibiting angiogenesis, and
CuraGen scientists are investigating this protein as a potential
therapeutic for the treatment of cancer. The unique activity of this
anti-angiogenic protein was revealed at the 93rd Annual American
Association for Cancer Research Conference.
* The world's existing drugs have been developed based upon 350
gene-based targets. To date, CuraGen scientists have identified and
are evaluating approximately 600 new gene-based targets that include
131 proteins, of which 5 have been advanced into validated therapeutic
candidates; 226 antibody targets, from which we are evaluating 17 fully
human monoclonal antibodies as potential therapeutics; and 261 small
molecule targets, of which six screens have been successfully
completed.
Strategic Drug Development Alliances
* Alexion Pharmaceuticals, Inc. and CuraGen entered into a drug target
discovery and validation agreement focused in oncology. This
multi-year agreement will enable each company to leverage the other's
respective expertise to discover and validate novel protein, antibody,
and small molecule targets for use in developing pharmaceutical
products. CuraGen will retain the rights to potential non-antibody
protein therapeutics across all disease areas and is eligible to
receive licensing fees, development milestone payments and sales
royalties from Alexion on pharmaceutical products stemming from this
alliance.
* SEQUENOM, Inc. and CuraGen established a relationship for the purpose
of rapidly determining the biological context of disease-associated
genes through the application of population genetics and proteomics.
Specifically, SEQUENOM will identify genes associated with human
diseases using its pioneering population genetics approach and CuraGen
will apply its platform of proteomic technologies to these targets, in
order to identify potential therapeutic intervention points by
examining networks of protein interactions within important
disease-related pathways. CuraGen will also enhance its own targets
using SEQUENOM's single nucleotide polymorphism (SNP) technologies,
large-scale twin populations, and population genetics approaches. The
Companies expect that this collaborative research will further enable
the identification and validation of key targets for drug discovery.
Continuing to Build the Team
* 454 Corporation, CuraGen's majority-owned subsidiary that was
established to develop novel technologies for rapidly and
comprehensively analyzing entire genomes named
Richard F. Begley, Ph.D., as President and Chief Executive Officer.
Dr. Begley joins 454 Corporation from Agilent Technologies where he
served as General Manager of several divisions within Agilent's
Chemical Analysis Group, which provides analytical measurement
solutions for GC/MS, LC/MS, LC/MS/MS, optical readers, DNA microarrays
and sample preparation. Dr. Begley's most recent position at Agilent
was Vice President and General Manager of Global Enterprise Solutions.
Dr. Begley will now lead 454's efforts in developing technologies for
conducting large scale genomic and proteomic analysis.
* David R. Ebsworth, Ph.D., former President and General Manager of the
Pharmaceutical Business Group for Bayer AG, and John H. Forsgren, Vice
Chairman of the Board and Chief Financial Officer of the Northeast
Utilities system (NU), were elected to CuraGen's Board of Directors.
Dr. Ebsworth is an experienced executive in the ethical,
pharmaceutical, biological, biotechnology and generic drug industries.
His experience encompasses more than 22 years at companies including
Pfizer and Bayer AG. Mr. Forsgren is a seasoned corporate financial
officer and is currently responsible for NU's financial and unregulated
organizations. Prior to joining NU, Mr. Forsgren was Managing Director
of Corporate Finance at Chase Manhattan Bank, and served as Senior Vice
President and Chief Financial Officer of Euro-Disney.
CuraGen Corporation (Nasdaq: CRGN - news) is a genomics-based pharmaceutical company. CuraGen's integrated, functional genomic technologies and Internet-based bioinformatic systems are designed to generate comprehensive information about genes, human genetic variations, gene expression, protein interactions, protein pathways, and potential drugs that affect these pathways. The Company is applying its industrialized genomic technologies, informatics, and validation technologies to develop protein, antibody, and small molecule therapeutics to treat obesity and diabetes, cancer, inflammatory diseases, and central nervous system (CNS) disorders. CuraGen is headquartered in New Haven, CT. Additional information is available at curagen.com.
This press release may contain forward-looking statements that are subject to risks and uncertainties, including statements about building a robust discovery stage and preclinical pipeline that will provide significant returns for many years to come; establishing another small molecule development alliance over the next six to twelve months; CuraGen's approach, which when combined with competitive analysis, results in the selection of high quality IND candidates that may ultimately save time, significantly improve odds for success in clinical development, and potentially reduce costly, later-stage clinical failures; submitting our first IND within the next six to twelve months; and finalizing the proper formulation and completing GMP manufacturing to supply clinical trials for CuraGen's lead protein candidate. Such statements are based on management's current expectations and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. CuraGen cautions investors that there can be no assurance that actual results or business conditions will not differ materially from those projected or suggested in such forward-looking statements as a result of various factors, including, but not limited to, the following: CuraGen's expectation that it will incur operating losses in the near future, the early stage of development of CuraGen's products and technologies, uncertainties related to preclinical and clinical testing and trials, uncertainties and adverse results relating to CuraGen's ability to obtain regulatory approval for its products in development, uncertainties surrounding the availability of additional funding, CuraGen's reliance on research collaborations and strategic alliances, the actions of competitors, the development of competing technologies, CuraGen's ability to protect its patents and proprietary rights, patent infringement actions and uncertainties relating to commercialization rights. Please refer to our Annual Report on Form 10-K for the fiscal year ended December 31, 2001 for a description of these risks. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
- (Financial Table to Follow) -
CURAGEN CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Three Months Ended
March 31,
2002 2001
Revenue:
Collaboration revenue $4,812 $5,662
Operating expenses:
Collaborative research and
development 20,134 12,134
General and administrative 5,934 4,523
Total operating expenses 26,068 16,657
Loss from operations (21,256) (10,995)
Interest income, net 406 4,895
Net loss before income taxes and
minority interest in subsidiary loss (20,850) (6,100)
Income tax benefit 535 500
Minority interest in subsidiary loss 684 246
Net loss ($19,631) ($5,354)
Basic and diluted net loss per share $(0.40) $(0.11)
Weighted average number of shares used
in computing basic and diluted net
loss per share 48,804 46,896
SELECTED BALANCE SHEET INFORMATION
March 31, December 31,
2002 2001
(unaudited) (audited)
Cash and short-term investments $478,086 $508,349
Working capital 468,808 496,131
Total assets 516,008 538,701
Total long-term liabilities 151,432 152,297
Accumulated deficit 144,223 124,592
Stockholders' equity 337,067 355,945
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