VARIAGENICS Announces Third Quarter 2002 Results
Wednesday November 6, 9:30 am ET
Company to Host Conference Call At 4:30 P.M.
CAMBRIDGE, Mass.--(BUSINESS WIRE)--Nov. 6, 2002--VARIAGENICS, INC. (Nasdaq: VGNX - News), an emerging molecular diagnostics company and a leader in cancer pharmacogenomics, today announced financial results for the third quarter ended September 30, 2002. Management will host a conference call and simultaneous audio webcast to discuss these results today at 4:30 p.m. EDT (details below).
For the third quarter of 2002, revenues were $0.2 million, compared with $0.6 million for the same period in 2001. The third quarter net loss excluding non-cash equity compensation was $5.9 million, or $0.24 per share (basic and diluted). This compares with a net loss excluding non-cash equity compensation of $5.2 million, or $0.22 per share (basic and diluted), for the comparable quarter ended September 30, 2001. The net loss for the third quarter of 2002, including all charges, was $6.5 million or $0.27 per share (basic and diluted) compared with a net loss, including all charges, of $6.6 million, or $0.28 per share (basic and diluted) for the third quarter of 2001.
For the nine months ended September 30, 2002, Variagenics reported revenues of $1.0 million compared with $2.6 million for the same period in 2001. The net loss for the first nine months of 2002 excluding non-cash equity compensation was $20.9 million, or $0.88 per share (basic and diluted). For the comparable nine-month period of 2001, the net loss excluding non-cash equity compensation was $12.1 million, or $0.52 per share (basic and diluted).
The Company ended the third quarter with cash and marketable securities of $60.8 million.
Recent highlights include:
Clinical Programs
Colorectal Cancer Diagnostics Program
In September, the company launched its program to develop molecular diagnostic tests predictive of patients' response to chemotherapy. The first trial will involve genetic analysis of 120 colorectal cancer patients who have experienced severe side effects following treatment with 5-fluorouracil (5-FU) chemotherapy. The goal of the study is to identify and confirm markers of toxicity through a retrospective analysis of polymorphisms in the normal DNA of these patients.
The Company's long-term goal is to develop a suite of molecular diagnostics to guide optimal treatment for colorectal cancer. In addition to this trial, Variagenics intends to conduct retrospective and prospective clinical studies involving 5-FU, irinotecan and oxaliplatin.
Chemotherapy Metabolism Initiative
In mid-July, Variagenics announced the completion of the enrollment phase of a prospective Phase I clinical study, whose objective is to identify the genetic contribution of variation in the CYP3A family of drug metabolizing enzymes. These enzymes account for the clearance of more than 50 percent of all cancer agents, and together with an understanding of genetic variability, could predict efficacy and tolerability of these drugs in patients.
As part of this initiative, Variagenics secured cancer diagnostic rights to a patent application for CYP3A5, a genetic marker that could predict patient response to chemotherapy, from St. Jude Children's Research Hospital in Memphis.
PRINCE Study
In late July, Variagenics announced the initiation of a large, retrospective study aimed at identifying markers that could predict patients' response to pravastatin, a leading cholesterol reducing agent. The study, conducted in collaboration with Brigham & Women's Hospital in Boston, will attempt to identify significant associations between variations in genes relevant to statin activity and the magnitude of reduction for cholesterol and C-reactive protein, which is known to vary widely among patients. Analysis of the nearly 3,000 patient samples will, in the short-term, provide the company with pharmacogenomic proof-of-principle, and longer-term could lead to the development of molecular diagnostic tests.
Outlicensing Agreements
MTHFR
Variagenics recently announced several licensing agreements allowing access to the company's MTHFR (methylenetetrahydrofolate reductase) patent. Under one agreement, Variagenics granted ARUP Laboratories non-exclusive rights to commercialize home brew tests for MTHFR allele testing associated with increased thrombo-embolic disease risk. Variagenics also granted Strida Pharma, Inc. a worldwide license relating to certain Variagenics' MTHFR patent rights. In late October, the Company granted Quest Diagnostics non-exclusive rights to commercialize laboratory-developed tests for MTHFR allele testing associated with increased thrombo-embolic disease risk and other disorders. Variagenics continues to seek non-exclusive licensors to this important marker in fields outside of cancer.
During the quarter, Variagenics granted Renegade Therapeutics a worldwide license to Variagenics' RNA targeting patent (PCT/US00/05271). The terms include up-front fees, milestone payments and royalties on sales of any compounds developed using the licensed technology.
About Variagenics
VARIAGENICS, INC. develops molecular diagnostic tests by identifying genetic markers associated with response to cancer therapies, with the goal of optimizing patient care. The Company analyzes genetic variation, including single nucleotide polymorphisms (SNPs), haplotypes, loss of heterozygosity, and expression levels in normal and tumor cells. VARIAGENICS is developing molecular diagnostic tests through both biopharmaceutical collaborations and its own internal research programs.
Conference Call Information
Variagenics' President and Chief Business Officer, Jay Mohr, and Chief Operating and Financial Officer, Rick Shea, will host a conference call and simultaneous audio webcast today at 4:30 p.m. EDT to discuss the financial results and events of the third quarter. The conference call can be accessed by dialing 1-888-482-0024, passcode 537893. The webcast can be heard by logging onto the Company's website at www.variagenics.com under the Investor Relations section. The call will be replayed for five days, by dialing 1-888-286-8010, passcode 64028.
For more information, please visit the Company's website at www.variagenics.com.
This press release may contain forward-looking statements, including statements regarding the effect of molecular diagnostics on therapeutic outcomes and the delivery of healthcare, the role that the Company will play in the field of pharmacogenomics, and the Company's plans and goals with respect to its clinical programs. Such statements are based on management's current expectations and are subject to certain factors, risks and uncertainties that may cause actual results, events and performance to differ materially from those referred to or implied in such statements. Certain of these factors, risks and uncertainties are identified in VARIAGENICS' Annual Report on Form 10-K for the fiscal year ended December 31, 2001. The Company does not intend to update any of the forward-looking statements after the date of this release to conform these statements to actual results or to changes in our expectations, except as may be required by law.
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Statements of Operations
(in thousands, except per share amounts)
(unaudited)
Three months ended Nine months ended
September 30, September 30,
2002 2001 2002 2001
Revenue:
Collaboration and other $178 $574 $592 $2,381
Product sales -- -- 450 210
Total revenue 178 574 1,042 2,591
Costs and expenses:
Cost of product sales -- -- 236 186
Research and development 4,450 4,519 14,612 11,477
General and administrative 1,818 2,312 6,064 6,626
Non-cash equity
compensation 682 1,403 5,303 3,843
Restructure and
related charges -- -- 1,974 --
Loss from operations (6,772) (7,660) (27,147) (19,541)
Other income (expense):
Interest income 326 1,114 1,206 3,803
Interest expense (87) (78) (259) (156)
Net loss $(6,533) $(6,624) $(26,200) $(15,894)
Net loss per share
(basic and diluted) $(0.27) $(0.28) $(1.11) $(0.68)
Weighted average common
shares outstanding
(basic and diluted) 24,076 23,346 23,688 23,272
Net loss excluding non-cash
equity compensation $(5,851) $(5,221) $(20,897) $(12,051)
Net loss per share
(basic and diluted)
excluding non-cash
equity compensation $(0.24) $(0.22) $(0.88) $(0.52)
Balance Sheet Data
(in thousands)
(unaudited)
Sept. 30, Dec. 31,
2002 2001
Cash, cash equivalents and short-term
marketable securities $55,698 $72,918
Working capital 52,456 69,709
Total cash and marketable securities 60,783 80,029
Total assets 69,630 90,932
Stockholders' equity 62,583 82,983
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Contact:
VARIAGENICS, INC.
Lilian Stern
Investor Relations
212/362-1200
lilian@sternir.com
or
Rick Shea
Chief Financial Officer
and Chief Operating Officer
617/588-5354
rshea@variagenics.com |
