Corixa Reports First Quarter 2002 Results and Provides Update On Select Programs
SEATTLE--(BW HealthWire)--May 15, 2002--Corixa Corp. (Nasdaq:CRXA - News), a developer of immunotherapeutics, today announced results for the first quarter ended March 31, 2002.
For the first quarter of 2002, Corixa reported total revenue of $15.6 million compared with total revenue of $13.5 million for the first quarter of 2001. Net loss applicable to common stockholders for the first quarter was $176.9 million, which included a goodwill impairment charge of $161.1 million, compared with $42.6 million for the first quarter of 2001, which included intangible amortization of $14.4 million. Diluted net loss per common share for the first quarter of 2002 was $4.25, compared with $1.05 for the first quarter of 2001. Excluding acquisition related charges, such as intangible and deferred compensation amortization and the goodwill impairment charge, net loss applicable to common stockholders and net loss per common share for the first quarter of 2002 were $14.3 million and $0.34 respectively compared with $19.1 million and $0.47 respectively for the first quarter of 2001.
Effective January 1, 2002, Corixa adopted Statement of Financial Accounting Standard (SFAS) No. 141 "Business Combination" and SFAS No. 142 "Goodwill and Other Intangible Assets" which requires use of a non-amortization approach to account for purchased goodwill and intangibles. In accordance with the transition provision of SFAS No. 142, an evaluation of goodwill and other intangibles was conducted as of January 1, 2002 and no indication of an impairment existed at that time. In addition, SFAS No. 142 states that interim evaluations should be conducted whenever an indication of potential impairment exists. On March 13, 2002, Corixa announced the receipt of a complete review letter from the U.S. Food and Drug Administration (FDA) regarding the Company's Biologics License Application (BLA) for BEXXAR®. In the complete review letter, the FDA stated that the Company should conduct additional clinical trials prior to consideration for approval. The company experienced a decrease in the value of its common stock following receipt of the complete review letter from the FDA. As a result, goodwill and certain other intangibles were then evaluated for impairment and a charge of $161.1 million was recognized.
The increase in revenue for the first quarter of 2002 compared with the prior year period was primarily due to collaborative agreements with Wyeth Lederle Vaccines, a business unit of American Home Products Corporation, GlaxoSmithKline, Beaufour Ipsen, and Zenyaku Kogyo. At the end of the quarter, Corixa had approximately $94.9 million in cash, cash equivalents and investments.
"Our first quarter results reflect our continued execution of new partnerships that could broadly extend the potential reach of our technology," said Dr. Steven Gillis, Ph.D., chairman and chief executive officer of Corixa.
Program Updates and First Quarter Milestones
BEXXAR
In a separate release also issued today (Corixa Announces Results of BEXXAR Discussions with FDA, May 15, 2002) Corixa announced the results of its recent meeting with the FDA regarding potential commercialization of BEXXAR.
In advance of the meeting, Corixa submitted to the FDA as a part of the BEXXAR BLA detailed responses to the clinical issues raised in the Agency's complete review letter dated March 12, 2002. At the meeting, Corixa and GlaxoSmithKline further articulated their belief that BEXXAR merits approval for the treatment of relapsed, refractory non-Hodgkin's lymphoma patients based on the high level of durable responses observed across multiple clinical studies. The companies contended that this level of persistent, independently confirmed, disease-free survival has not been demonstrated in clinical trials of other products. As a result, the companies believe that BEXXAR does address a medical need that cannot be met via administration of previously approved products in this patient population. Following these discussions, the FDA continued to question the clinical benefit of BEXXAR and suggested that such benefit should be shown in additional, prospective clinical studies.
Following the companies' presentation, and given that a second complete review letter has already been issued, the companies and the FDA discussed an appropriate process for resolution of the existing differences in opinion. This approach involves a formal request for dispute resolution under the Food and Drug Administration Modernization Act (FDAMA).
As a result of the discussion with the FDA, Corixa will submit a written request to appeal the FDA's position as articulated in the complete review letter dated March 12, 2002 and will further request a presentation of BEXXAR data to the FDA's scientific advisors, the Oncologic Drugs Advisory Committee (ODAC).
MELACINE
In February 2002, Corixa announced that the ODAC endorsed Corixa's proposed design for a second Phase III clinical trial for its melanoma vaccine, MELACINE®, following the company's presentation to the panel on February 27, 2002 in Bethesda, Maryland.
Corixa presented results from the Southwest Oncology Group trial (SWOG-9035) that demonstrated MELACINE vaccine was effective in prolonging relapse-free survival (p=0.005) and overall survival (p=0.003) compared to observation in patients who expressed HLA A2 and/or HLA C3. The panel agreed that the proposed second Phase III trial, with overall survival as the primary endpoint, in addition to the supportive data from the first Phase III trial (SWOG-9035), would be acceptable for potential approval of MELACINE vaccine.
RC-529
In January 2002 Corixa and Rhein Biotech, N.V announced highly statistically significant preliminary results of a Phase III, randomized, controlled pivotal trial to test the efficacy and safety of Corixa's RC-529 synthetic adjuvant when used in combination with Rhein Biotech's yeast Hansenula polymorpha-based recombinant Hepatitis B antigen (HBsAg), the active ingredient of commercially approved Hepatitis B vaccines (Hepavax-Gene®, AgB®, Biovac B®). Results of the primary efficacy analyses showed that there were significantly more patients seroprotected after two immunizations with Rhein Biotech's Hepatitis B vaccine plus RC-529 than with the Hepatitis B vaccine alone (95.5 percent vs. 82.1 percent, p=0.001). Safety data will not be available until the completion of the study.
Agreements
On January 15, 2002 Corixa Corporation and Beaufour Ipsen Group, a European global pharmaceutical company, announced a license, development and commercialization agreement for Corixa's ANERGIX.MG(TM) technology for the treatment of myasthenia gravis, a chronic autoimmune neuromuscular disease that causes varying degrees of weakness of the skeletal muscles of the body.
On February 27, 2002 Corixa Corporation and Beckman Coulter, Inc. announced a cross-licensing agreement. Under the agreement, Beckman Coulter granted Corixa a sublicense to its proprietary MHC Tetramer technology for use in preclinical research. In return, Beckman Coulter receives licensing fees. Corixa has agreed to purchase Beckman Coulter iTAg(TM) MHC Tetramers to support their clinical trials. Also under the agreement, Corixa granted Beckman Coulter a license to certain patented technology, which Beckman Coulter intends to use in the development of MHC Tetramers for autoimmune disease diagnostics. In return, Corixa will receive royalty payments on any sales of products developed using the licensed technology.
On March 18, 2002 Corixa Corporation and the Advanced Diagnostic and Cellular Systems (ADCS) division of Ortho-Clinical Diagnostics (OCD), a Johnson & Johnson company announced a collaboration to develop molecular diagnostic tests for breast cancer based on several of Corixa's proprietary genes that have originated from Corixa's ongoing discovery program.
Under the terms of the agreement, Corixa will grant Ortho-Clinical Diagnostics exclusive worldwide rights to use its breast cancer genes in nucleic acid diagnostics applications. In return, Ortho-Clinical Diagnostics/ADCS will provide Corixa with research funding, milestone payments and royalties based on future product sales.
Conference Call Information
Wednesday, May 15, 2002, 8:30 a.m. ET/5:30 a.m. PT
Access Via the Web:
Participants can sign up in the Investors section of Corixa's web site:
corixa.com.
Access Via the Phone:
Participants can access the conference call by dialing 800/406-5356 (international use 913/981-5572), code 690321.
If you are unable to participate in Wednesday's conference call, you can access a recorded rebroadcast by going to the Investors section of Corixa's web site (www.corixa.com) or by dialing 888/203-1112, (international use 719/457-0820) and enter code 690321. The call will be rebroadcast until 11:00 pm ET, May 17, 2002.
About Corixa
Corixa is a developer of immunotherapeutics with a commitment to treating and preventing autoimmune diseases, cancer and infectious diseases by understanding and directing the immune system. Corixa is focused on immunotherapeutic products and has a broad technology platform enabling both fully integrated vaccine design and the use of its separate, proprietary product components on a standalone basis. Corixa currently has 18 programs in clinical development and 22 programs in preclinical development.
The company partners with numerous developers and marketers of pharmaceuticals, targeting products that are Powered by Corixa(TM) technology with the goal of making its potential products available to patients around the world. Corixa was founded in 1994 and is headquartered in Seattle, with additional operations in Hamilton, Mont., and South San Francisco. For more information, please visit Corixa's Web site at corixa.com or call the company's investor relations information line at 877/4CORIXA (426-7492) or 877/426-7492.
Corixa Forward Looking Statements
Except for the historical information presented, certain matters discussed in this press release are forward-looking statements. Forward-looking statements are based on the opinions and estimates of management at the time the statements are made. They are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. Factors that could affect Corixa's actual results include, but are not limited to the risk that we do not realize the expected benefits of our new partnerships, the risk that the FDA does not approve BEXXAR for commercialization in a timely fashion, if at all, the risk that we are unable to successfully commercialize BEXXAR or our other product candidates, and the "Important Factors That May Affect Our Business, Our Results of Operations and Our Stock Price," described in Corixa's Annual Report on Form 10-K for the year ended Dec. 31, 2001, copies of which are available from Corixa's investor relations department. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release.
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Corixa Corporation
Consolidated Statement of Operations
(In thousands except per share data)
Three months ended March 31,
--------------------------------
2002 2001
--------------------------------
Revenue:
Collaborative agreements..... $ 15,005 $ 12,596
Government grants............ 561 905
--------------------------------
Total revenue.............. 15,566 13,501
Operating expenses:
Research and development..... 24,685 38,796
Sales, general and
administrative.............. 6,983 6,923
Intangible amortization...... 495 14,437
Goodwill impairment.......... 161,060 -
--------------------------------
Total operating expenses... 193,223 60,156
Loss from operations........... (177,657) (46,655)
Interest income................ 1,195 3,078
Interest expense............... (550) (707)
Other income................... 322 2,312
--------------------------------
Net loss....................... (176,690) (41,972)
Preferred stock dividend....... (226) (625)
--------------------------------
Net loss applicable to
common stockholders........... $ (176,916) $ (42,597)
================================
Basic and diluted net loss
per common share.............. $ (4.25) $ (1.05)
================================
Shares used in computation of
basic and diluted net loss
per common share.............. 41,596 40,599
================================
March 31, December 31,
2002 2001
--------------------------------
Balance Sheet Data:
Cash, cash equivalents and
securities available-for-sale. $ 94,870 $ 121,064
Working capital................ 45,650 53,946
Total assets................... 182,240 367,382
Long-term obligations less
current portion............... 29,065 27,657
Accumulated deficit............ (1,079,932) (903,242)
Total stockholders' equity..... 105,028 281,765
Three months ended March 31,
--------------------------------
2002 2001
--------------------------------
Reconciliation of net loss to net loss excluding
acquisition related charges:
Net loss applicable to
common stockholders........... $ (176,916) $ (42,597)
Intangible amortization...... 495 14,437
Goodwill impairment.......... 161,060 -
Deferred compensation
amortization................ 1,081 6,722
Other charges................ - 2,355
--------------------------------
Net loss excluding acquisition
related charges............... $ (14,280) $ (19,083)
================================
Basic and diluted net loss per
share excluding acquisition
related charges............... $ (0.34) $ (0.47)
================================
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Contact:
Corixa Corp.
Jim DeNike, 206/754-5931
denike@corixa.com
or
Waggener Edstrom Bioscience
Colleen Beauregard, 503/443-7000
colleenb@wagged.com |
