Cell Genesys Reports Fourth Quarter and 2003 Results
Monday January 26, 4:12 pm ET
SOUTH SAN FRANCISCO, Calif., Jan. 26 /PRNewswire-FirstCall/ -- Cell Genesys, Inc. (Nasdaq: CEGE - News) reported a net loss for the quarter ended December 31, 2003 of $17.3 million, or $0.43 per share, and a net loss for the year then ended of $56.6 million, or $1.48 per share. This compares with a net loss of $12.3 million and a net loss of $27.3 million in the same quarter and full year of 2002, respectively. The company's increase in net loss for 2003 is due primarily to continued investment in the company's multiple clinical-stage product development programs and lower revenues compared to 2002 due to the non-recurrence of certain one-time license fees. Cell Genesys ended 2003 with $160.3 million in cash and investments, including restricted cash, compared with $166.9 million at the end of 2002. Additionally, Cell Genesys continued to hold 7.4 million shares of its former subsidiary, Abgenix, Inc., at the end of 2003.
Revenues for the fourth quarter and year ended December 31, 2003 were $1.4 million and $18.1 million, respectively, compared with $2.0 million and $39.1 million in the comparable periods of 2002. The decrease in revenues in 2003 can be attributed primarily to a non-recurring license fee reported in 2002 of $26.0 million associated with a license agreement with Transkaryotic Therapies, Inc. (TKT) for the company's gene activation technology.
Research and development costs were $21.3 million and $85.3 million in the fourth quarter and year ended December 31, 2003, respectively, compared with $21.3 million and $75.1 million for the comparable periods of 2002. The annual increase can be attributed primarily to the company's expanding clinical programs for both its GVAX® cancer vaccines and oncolytic virus therapies.
"We are pleased with our progress during 2003 across our deep pipeline of biological therapies for cancer including our lead product candidate, GVAX® prostate cancer vaccine, which is targeted to enter Phase 3 clinical trials during the second quarter," stated Stephen A. Sherwin, M.D., chairman and chief executive officer of Cell Genesys. "Our financial strength and diversified business assets have enabled us to prepare for our approaching late stage clinical trials by establishing the necessary manufacturing infrastructure in advance of Phase 3 trials and potential market launch."
Fourth Quarter 2003 and Other Recent Highlights:
* Announced at the JP Morgan Healthcare Conference in January that Cell Genesys has conducted a successful clinical End of Phase 2 meeting with the FDA to support the company's plans to initiate the first of two Phase 3 clinical trials of GVAX® prostate cancer vaccine in the second quarter of 2004.
* Reported at the American Society of Hematology (ASH) Annual Meeting in December, interim clinical data from a Phase 2 trial of GVAX® cancer vaccine for acute myelogenous leukemia (AML). The preliminary findings of this trial indicate that vaccine therapy is well tolerated and may reduce residual leukemic cells that persist after chemotherapy as indicated by decreased levels of WT-1, a leukemia-associated genetic marker in the majority of patients tested to date. The WT-1 marker is detectable in over 95 percent of patients with active AML.
* Announced that Dennis L. Winger has joined Cell Genesys' board of directors. Mr. Winger is currently senior vice president and chief financial officer of Applera Corporation and was previously senior vice president of finance and administration and chief financial officer at Chiron Corporation. Mr. Winger brings over 30 years of industry finance experience to the Cell Genesys board, the majority of which has focused on the life sciences industry.
Cell Genesys is focused on the development and commercialization of novel biological therapies for patients with cancer. The company is pursuing three cancer product platforms -- GVAX® cancer vaccines, oncolytic virus therapies and antiangiogenesis therapies. Clinical trials of GVAX® vaccines are under way in prostate cancer, lung cancer, pancreatic cancer, leukemia and myeloma. Clinical programs of oncolytic virus therapies include CG7870 for prostate cancer. Preclinical studies are in progress for additional GVAX® cancer vaccines, oncolytic virus therapies and antiangiogenesis therapies for multiple types of cancer. Cell Genesys' majority-owned subsidiary, Ceregene, Inc., is focused on gene therapies for neurologic disorders. Cell Genesys also continues to hold an equity interest in its former subsidiary, Abgenix, Inc., an antibody products company. Cell Genesys is headquartered in South San Francisco, CA and has manufacturing operations in San Diego, CA, Hayward, CA and Memphis, TN. For additional information, please visit the company's website at www.cellgenesys.com.
Cell Genesys will host its quarterly conference call to discuss events that occurred during the fourth quarter and to provide financial guidance for 2004 at 8:30 a.m. PST on Tuesday, January 27, 2004. Investors may listen to the webcast of the conference call live on Cell Genesys' website. A replay of the webcast will be available for at least 48 hours following the call. Alternatively, investors may listen to a replay of the call by dialing 800-475-6701 from locations in the U.S. and 320-365-3844 from outside the U.S. The call-in replay will be available for 48 hours following the call. Please refer to reservation number 718389.
Statements made herein about the company and its subsidiaries, other than statements of historical fact, including statements about the application of the company's financial assets, the company's progress and results and timing of clinical trials, including Phase 3 trials of GVAX® prostate cancer vaccine, and preclinical programs, progress and capabilities of manufacturing facility sites and the nature of product pipelines are forward-looking statements and are subject to a number of uncertainties that could cause actual results to differ materially from the statements made, including risks associated with the success of research and development programs, clinical trials, the regulatory approval process for clinical trials, competitive technologies and products, patents, continuation of corporate partnerships and the need for additional financings. For information about these and other risks which may affect Cell Genesys, please see the company's Annual Report on Form 10-K dated March 31, 2003 as well as Cell Genesys' reports on Forms 10-Q and 8-K and other reports filed from time to time with the Securities and Exchange Commission. The company assumes no obligation to update the forward-looking information in this press release.
Contact: Jennifer Cook Williams, Director, Corporate Communications and Investor Relations of Cell Genesys, +1-650-266-3200.
SELECTED CONSOLIDATED FINANCIAL INFORMATION
CONSOLIDATED STATEMENT OF OPERATIONS DATA
(in thousands Three months ended Year ended
except per December 31, December 31,
share data) 2003 2002 2003 2002
(unaudited) (unaudited) (unaudited) (note 1)
Revenue $1,367 $1,968 $18,128 $39,141
Operating expenses:
Research and
development 21,289 21,285 85,296 75,138
General and
administrative 7,570 9,321 25,980 20,697
Credit for purchased
in-process technology -- -- -- (186)
Total operating
expenses 28,859 30,606 111,276 95,649
Loss from operations (27,492) (28,638) (93,148) (56,508)
Gain on sale of
Abgenix, Inc.
common stock 2,733 2,246 12,638 2,246
Interest and
other income 633 2,711 4,832 9,942
Interest expense (2,238) (94) (5,360) (1,011)
Loss before minority
interest and
income taxes (26,364) (23,775) (81,038) (45,331)
Loss attributed to
minority interest -- -- -- 96
Loss before income
taxes (26,364) (23,775) (81,038) (45,235)
Income tax benefit 9,343 12,225 24,632 18,636
Net loss (17,021) (11,550) (56,406) (26,599)
Deemed dividend to
preferred stockholders 230 702 230 702
Net loss attributed to
common stockholders $(17,251) $(12,252) $(56,636) $(27,301)
Basic and diluted
net loss per
common share $(0.43) $(0.34) $(1.48) $(0.76)
Weighted average
shares of common
stock outstanding
- basic and diluted 39,662 36,454 38,177 35,889
CONSOLIDATED BALANCE SHEET DATA
(in thousands) December 31,
2003 2002
(unaudited) (note 1)
Cash, cash equivalents and short-term
investments, including restricted cash
and investments $160,288 $166,905
Receivable from Transkaryotic Therapies, Inc -- 15,000
Investment in Abgenix, Inc. common stock 91,936 64,076
Other current assets 1,173 1,340
Property and equipment, net 172,102 157,215
Noncurrent deferred tax assets 34,247 13,349
Other assets 756 1,312
Total assets $460,502 $419,197
Deferred revenue $7,877 $5,871
Deferred tax liabilities 34,247 23,147
Other current liabilities 22,218 29,767
Noncurrent income tax liabilities 29,954 17,568
Noncurrent portion of debt financing 94,835 51,703
Noncurrent portion of facility lease obligation 51,799 52,361
Series B preferred stock 2,706 7,632
Stockholders' equity 216,866 231,148
Total liabilities and stockholders' equity $460,502 $419,197
Note 1. Derived from audited financial statements.
Source: Cell Genesys, Inc. |
