Vical Reports 2006 Financial Results
Tuesday February 20, 6:30 am ET
SAN DIEGO, Feb. 20 /PRNewswire-FirstCall/ -- Vical Incorporated (Nasdaq: VICL - News) today reported financial results for the year ended December 31, 2006. Revenues for 2006 were $14.7 million compared with $12.0 million for 2005. The increase in revenues was driven primarily by contract manufacturing shipments of bulk DNA for the National Institutes of Health (NIH) in support of planned Phase 2 HIV vaccine studies, partially offset by decreased licensing revenues in 2006 compared with 2005. The reported net loss for 2006 was $23.1 million or $0.74 per share, compared with $24.4 million or $0.99 per share for 2005. The net loss for 2006 was in line with the low end of the company's projected net loss range for 2006.
Vical completed three registered direct offerings in the second half of 2006, placing approximately 9.5 million shares of its common stock with institutional investors for estimated net proceeds of approximately $47 million.
* In the first transaction, in August 2006, the company placed
approximately 2.1 million shares with Capital Group International for
net proceeds of approximately $9.7 million. Capital Group is a global
investment manager with approximately $900 billion of assets in the
American Funds family of mutual funds through its Capital Research and
Management division, and approximately $300 billion of institutional
investments under management through its Capital International
division. The firm has a track record of long-term investment driven
by bottom-up fundamental research.
* In the second transaction, in October 2006, the company placed
2.5 million shares with a pair of institutional investors for net
proceeds of approximately $12.4 million. The size of the investment
and the quality of the investors were significant factors in the
decision to proceed.
* In the third transaction, also in October 2006, the company placed
approximately 5 million shares with Temasek Holdings of Singapore, for
net proceeds of $24.9 million dollars, making Temasek Vical's largest
shareholder. Temasek is a private investment firm managing a
diversified $80 billion dollar portfolio for only one client -- the
government of Singapore. Since Temasek was incorporated in 1974, it
has generated total returns for its client of 18% compounded annually.
As a result of the offerings, Vical had cash and investments of approximately $100 million at year-end 2006. Vical's net cash burn in 2006, excluding equity investments, was approximately $21 million.
2007 Outlook
The company is projecting a net loss for 2007 of between $32 million and $35 million and a net cash burn, excluding equity investments, of $27 million to $30 million. The increase in projected net loss reflects:
* Increasing activity in the company's Phase 3 trial of its
Allovectin-7® cancer immunotherapeutic as first-line therapy in
chemotherapy-naive patients with recurrent Stage III or IV metastatic
melanoma, which is being funded through cash payments and equity
investments by AnGes MG, Inc., under a collaborative agreement;
* Increasing enrollments in the company's Phase 2 trial of its candidate
DNA vaccine against cytomegalovirus (CMV) in donors and patients
undergoing stem cell transplants; and
* Initiation of a Phase 1 trial with the company's avian influenza
vaccine candidate to evaluate safety and immunogenicity in healthy
volunteers.
Additional expectations for 2007 include:
* Preliminary evaluation of efficacy by the company's licensee, AnGes MG,
Inc., in the Japanese Phase 3 angiogenesis trial involving DNA-based
delivery of Hepatocyte Growth Factor (HGF), an angiogenic growth
factor, in patients with advanced peripheral arterial disease.
Although enrollment and treatment in the trial are ongoing, if the
results are sufficiently positive, AnGes hopes that it might be able to
file for marketing approval in Japan based on data from patients
already enrolled.
* Conditional approval of a DNA vaccine to prevent recurrence of
melanoma in dogs for the company's licensee, Merial Ltd., a joint
venture of Merck & Co., Inc., and Sanofi Aventis Group;
* Initiation of a Phase 3 trial by the company's licensee, Sanofi Aventis
Group, for the gene-based delivery of Fibroblast Growth Factor 1
(FGF-1), an angiogenic growth factor, intended to promote the growth of
blood vessels in patients with reduced blood flow to the limbs; and
* Release of data from DNA vaccine clinical trials conducted by the NIH
for HIV and Severe Acute Respiratory Syndrome (SARS).
Conference Call
Vical will conduct a conference call and webcast to discuss the financial results and program updates with invited analysts and institutional investors today, February 20, at noon Eastern Time. The call and webcast are open on a listen-only basis to any interested parties. To listen to the conference call, dial (888) 224-3260, or (913) 905-1086 for international participants. A replay of the call will be available for 48 hours beginning about two hours after the call. To listen to the replay, dial (888) 203-1112, or (719) 457-0820 for international participants, and enter conference identification number 7937554. The call also will be available live and archived through the events page at www.vical.com. For further information, contact Vical's Investor Relations department by phone at (858) 646-1127 or by e-mail at info@vical.com.
About Vical
Vical researches and develops biopharmaceutical products based on its patented DNA delivery technologies for the prevention and treatment of serious or life-threatening diseases. Potential applications of the company's DNA delivery technology include DNA vaccines for infectious diseases or cancer, in which the expressed protein is an immunogen; cancer immunotherapeutics, in which the expressed protein is an immune system stimulant; and cardiovascular therapies, in which the expressed protein is an angiogenic growth factor. The company is developing certain infectious disease vaccines and cancer therapeutics internally. In addition, the company collaborates with major pharmaceutical companies and biotechnology companies that give it access to complementary technologies or greater resources. These strategic partnerships provide the company with mutually beneficial opportunities to expand its product pipeline and address significant unmet medical needs. Additional information on Vical is available at www.vical.com. |
