>>HAYWARD, Calif., Feb. 26 /PRNewswire-FirstCall/ -- Aradigm Corporation (Nasdaq: ARDM - News) today announced financial results for the fourth quarter and year ended December 31, 2002.
Contract revenues for the fourth quarter of 2002 increased to $7.6 million from $6.8 million for the same period in 2001, an increase of 11 percent. Revenues were primarily derived from the collaboration agreements with Novo Nordisk A/S to develop the AERx® Diabetes Management System, and three undisclosed contracts to evaluate the use of AERx technology. The Company reported net loss applicable to common shareholders for the fourth quarter 2002 of $7.1 million, or $0.23 per share, compared with a loss of $20.9 million, or $0.77 per share, for the same period in 2001. Total operating expenses for the fourth quarter 2002 were $14.6 million, compared with $17.0 million for the same period in 2001.
Contract revenues for the year ended December 31, 2002 increased to $29.0 million, compared to $28.9 million for the same period in 2001. For the year ended December 31, 2002, the Company reported net loss applicable to common shareholders of $35.9 million, or $1.19 per share, compared with a loss of $43.1 million, or $1.98 per share, for the same period in 2001. Total expenses for the year ended December 31, 2002 were $65.1 million, compared with $68.2 million for the same period in 2001.
For the quarter and year ended December 31, 2001, the net loss applicable to common shareholders included a deemed dividend of $10.7 million related to the recording of the beneficial conversion feature resulting from the Series A Convertible Preferred Stock financing completed in December 2001. The net loss before the deemed dividend for the fourth quarter of 2001 and for the year ended December 31, 2001 was $10.2 million or $0.37 per share and $32.4 million, or $1.48 per share, respectively.
As of December 31, 2002, cash, cash equivalents and all investments totaled approximately $31.4 million.
Recent Highlights
Financially, as recently announced, Aradigm has entered into agreements with a select group of investors for a $15 million private placement of Common Stock and warrants. A special meeting of shareholders to approve this financing has been scheduled for March 7, 2003, and the Company expects to complete the financing shortly after that meeting and for working capital. The proceeds from this round of financing will be used to further partner-funded development projects and enhance the commercial manufacturing scale-up process.
Earlier this month, the Company also announced that management will execute a cost reduction plan. Designed to more closely align Aradigm's operations with its partnered projects, management expects to pare spending on non-reimbursed and non-core projects by approximately 15 percent, largely by reallocating personnel to partnered projects. This program is expected to reduce Aradigm's monthly unreimbursed burn rate to approximately $2 million per month, or $24 million annually, a 20 percent reduction.
"During the quarter, efforts focused largely on the company's development of commercial-scale manufacturing capabilities," said Richard Thompson, President and CEO of Aradigm. "With the Phase 3 trials of the AERx Diabetes Management System underway, we are on a parallel track to complete manufacturing development in time for the planned regulatory filings."
Said Mr. Thompson: "Now, with a stable AERx technology platform and a growing body of supporting research, we anticipate increasing our product offerings through implementation of a newly devised disease targeting strategy that is expected to yield new partnerships recognizing liquid pulmonary delivery as the preferred approach to traditional delivery methods."
Conference Call
The company will host a conference call and question and answer session at 4:30 pm EST, 1:30 pm PST today to discuss these financial results. Dial 1-866-418-3599 to access the conference call. International callers dial +1-847-619-6341. The event webcast can be found under the investor relations section at: www.aradigm.com. The webcast and audio replay of the conference call will be available for one week following the call, which can be accessed on www.aradigm.com or by dialing toll free 1-877-213-9653. International callers should dial +1-630-652-3041. The replay passcode is 6773027.
Aradigm is working to improve the quality of life for patients by developing aerosol-based drug delivery alternatives to injectable therapeutics. The company's advanced pulmonary delivery technologies provide leading pharmaceutical and biotechnology partners with effective drug delivery solutions. Aradigm's technology uses liquid drug formulations that are similar to the injectable forms, which may minimize the potential for safety concerns when delivered by the pulmonary route. Current development programs focus on diabetes, pain management, and the pulmonary delivery of existing and emerging biotech therapeutics. Based in Hayward, California, Aradigm is currently developing products for diabetes management with Novo Nordisk A/S, the world leader in insulin and diabetes care, and for breakthrough and acute pain management with GlaxoSmithKline, a world leader in oncology therapy and supportive care. In addition, Aradigm has five other partner-funded programs including two gene therapy efforts targeting chronic lung diseases. More information about Aradigm can be found at www.aradigm.com. Investors may also request company information via email by directing inquiries to investor@aradigm.com.
Please note:
Except for the historical information contained herein, this news release contains forward-looking statements that involve risk and uncertainties, including clinical results, the timely availability and acceptance of new products, the impact of competitive products and pricing, and the management of growth, as well as the other risks detailed from time to time in Aradigm Corporation's Securities and Exchange Commission (SEC) Filings, including the company's Annual Report on Form 10-K as amended, and quarterly reports on Form 10-Q.
CONTACT: Chris Keenan of Aradigm Corporation, +1-510-265-9370; or Joe Dorame of RCG Capital Markets Group, Inc., +1-480-675-0400, for Aradigm Corporation.
ARADIGM CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
(IN $000'S, EXCEPT PER SHARE INFORMATION)
THREE MONTHS ENDED TWELVE MONTHS ENDED
DECEMBER 31, DECEMBER 31,
2002 2001 2002 2001
(UNAUDITED)
CONTRACT REVENUES - FROM RELATED
PARTIES $7,182 $6,578 $26,864 $26,031
CONTRACT REVENUES - OTHER 421 242 2,103 2,885
TOTAL CONTRACT REVENUES 7,603 6,820 28,967 28,916
OPERATING EXPENSES:
RESEARCH AND DEVELOPMENT 12,119 14,488 54,680 58,836
GENERAL AND ADMINISTRATIVE 2,491 2,472 10,394 9,355
TOTAL OPERATING EXPENSES 14,610 16,960 65,074 68,191
LOSS FROM OPERATIONS (7,007) (10,140) (36,107) (39,275)
OTHER INCOME (EXPENSE):
INTEREST INCOME 154 190 818 1,324
OTHER INCOME -- -- -- 6,675
INTEREST EXPENSE AND OTHER (293) (239) (642) (1,081)
TOTAL OTHER INCOME (EXPENSE) (139) (49) 176 6,918
NET LOSS (7,146) (10,189) (35,931) (32,357)
DEEMED DIVIDEND -- (10,722) -- (10,722)
NET LOSS APPLICABLE TO COMMON
SHAREHOLDERS ($7,146) ($20,911) ($35,931) ($43,079)
BASIC AND DILUTED LOSS PER SHARE
APPLICABLE TO COMMON SHAREHOLDERS: $(0.23) $(0.77) $(1.19) $(1.98)
SHARES USED IN COMPUTING BASIC AND
DILUTED LOSS PER SHARE 31,158 27,319 30,261 21,792
ARADIGM CORPORATION
CONDENSED BALANCE SHEETS
(IN $000'S)
DECEMBER 31, DECEMBER 31,
2002 2001
ASSETS
CURRENT ASSETS:
CASH, CASH EQUIVALENTS & SHORT-TERM
INVESTMENTS $29,890 $71,164
RECEIVABLES 282 1,349
OTHER CURRENT ASSETS 1,593 957
TOTAL CURRENT ASSETS 31,765 73,470
PROPERTY AND EQUIPMENT, NET 63,233 57,940
NOTES RECEIVABLE FROM OFFICERS 169 160
LONG-TERM INVESTMENTS 1,553 --
OTHER ASSETS 409 530
TOTAL ASSETS $97,129 $132,100
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
ACCOUNTS PAYABLE $1,951 $5,297
ACCRUED CLINICAL AND COST OF OTHER
STUDIES 291 703
ACCRUED COMPENSATION 2,195 1,761
DEFERRED REVENUE 10,682 11,115
OTHER ACCRUED LIABILITIES 407 2,760
CURRENT PORTION OF CAPITAL LEASE
OBLIGATIONS 1,753 3,526
TOTAL CURRENT LIABILITIES 17,279 25,162
NONCURRENT PORTION OF DEFERRED REVENUE 6,170 2,327
NONCURRENT PORTION OF CAPITAL LEASE
OBLIGATIONS 497 2,427
NONCURRENT PORTION OF DEFERRED RENT 1,108 300
REDEEMABLE CONVERTIBLE PREFERRED STOCK 30,665 30,735
SHAREHOLDERS' EQUITY 41,410 71,149
TOTAL LIABILITIES, REDEEMABLE
CONVERTIBLE PREFERRED
STOCK & SHAREHOLDERS' EQUITY $97,129 $132,100<<
Cheers, Tuck |
