>>Nektar Announces Financial Results for the Year and Fourth Quarter 2006
Wednesday February 28, 4:10 pm ET
SAN CARLOS, Calif.--(BUSINESS WIRE)--Nektar Therapeutics (Nasdaq:NKTR - News) today announced its financial results for the year and fourth quarter ended December 31, 2006, which are in line with the company's financial guidance for 2006.
For 2006, Nektar reported total revenue of $217.7 million, compared to $126.3 million in 2005. In 2006, product sales and royalty revenue was $153.6 million compared to $29.4 million in 2005; contract research revenue was $56.3 million compared to $81.6 for 2005. Revenue for 2006 related to Exubera® (insulin human (rDNA origin)) Inhalation Powder was $110.2 million.
As of December 31, 2006, Nektar had cash, cash equivalents, and short- and long-term investments of $467.0 million compared to $490.9 million as of September 30, 2006.
For 2006, Nektar reported a generally accepted accounting principles (GAAP) net loss of $154.8 million or $(1.72) per share compared to a GAAP net loss in 2005 of $185.1 million or $(2.15) per share. For 2006, Nektar reported a non-GAAP net loss of $92.3 million or $(1.03) per share compared to a non-GAAP net loss for 2005 of $111.9 million or $(1.30) per share. The non-GAAP net loss for 2006 excludes $17.3 million of SFAS 123R stock-based compensation charges, a $17.7 million charge for a litigation settlement with the University of Alabama Huntsville, a $5.5 million for impairment of long lived assets, and $21.9 million in severance and restructuring charges. The non-GAAP net loss for 2005 excludes the charge of $65.3 million for non-cash impairment of goodwill and write-off of certain fixed assets related to Nektar's United Kingdom subsidiary and $7.9 million for purchased in-process research and development expense associated with the acquisition of Aerogen, Inc. See the supplemental table attached to this press release entitled "Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures."
"Over the years, Nektar has built a strong diversified business with a rich pipeline of partner and proprietary products developed from leading-edge pulmonary and PEGylation technology," said Howard W. Robin, president and chief executive officer. "I am convinced that tremendous additional shareholder value can be created by leveraging these innovative technology platforms into a strong and differentiated product pipeline for Nektar. In addition, we are excited about the positive response of patients on Exubera, the most important innovation in insulin delivery in the last 80 years. We are confident in the potential of Exubera, and are working closely with Pfizer to make this product a success."
For the three months ended December 31, 2006, Nektar reported total revenue of $69.9 million compared to $32.9 million in the same period in 2005. For the three months ended December 31, 2006, product sales and royalty revenue was $55.6 million compared to $9.1 million in the same period in 2005. Contract research revenue was $12.1 million compared to $18.9 million in the same period in 2005. For the three months ended December 31, 2006, Exubera product sales and royalty revenue was $39.8 million.
The company's GAAP net loss was $38.9 million or $(0.43) per share for the three months ended December 31, 2006, compared to a GAAP net loss of $108.1 million or $(1.23) per share in the same period 2005. The company's non-GAAP net loss was $29.0 million or $(0.32) per share for the three months ended December 31, 2006 compared to a non-GAAP net loss of $34.9 million or $(0.40) per share in the three months ended December 31, 2005. The non-GAAP net loss for the three months ended December 31, 2006 excludes $4.0 million of SFAS 123R stock-based compensation charges and $5.5 million for impairment of long lived assets. The non-GAAP net loss for the three months ended December 31, 2005 excludes the charge of $65.3 million for non-cash impairment of goodwill and the write-off of certain fixed assets related to Nektar's United Kingdom subsidiary and $7.9 million for purchased in-process research and development expense associated with the acquisition of Aerogen, Inc. See the supplemental table attached to this press release entitled, "Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures."
Financial Outlook for 2007
Today Nektar is reiterating its full year 2007 financial performance estimates, provided on November 2, 2006. The company's financial guidance for 2007 is as follows:
-- Total revenue in the range of $210 to $250 million, including
Exubera product and royalty revenue of $110 to $130 million, with
most of the estimated Exubera revenue based on estimated
manufacturing sales of Exubera to Pfizer;
-- GAAP net loss of $110 to $130 million;
-- Non-GAAP net loss of $75 to $95 million. The non-GAAP net loss
estimated range excludes approximately $25 million of estimated
SFAS 123R stock-based compensation charges and $10 million Aerogen
restructuring costs. See the supplemental table attached to this
press release entitled "Reconciliation of Non-GAAP Projected
Financial Guidance for 2007."
Highlights of the Past Year
-- New President and CEO Howard W. Robin joined Nektar on January 15,
2007, bringing more than 25 years of successful biopharmaceutical
experience managing clinical development and commercial
operations.
-- Exubera was approved in the U.S., EU, Mexico, and Brazil with
launches in the U.S., U.K., Germany, and Ireland. Pfizer commenced
a phased launch in the U.S. focusing on the education of
endocrinologists and most recently primary care physicians,
diabetes educators, and pharmacists.
-- Nektar made advances in its proprietary product development
programs, where the company is applying its pulmonary and
PEGylation platform technology to develop new and improved
medicines from existing molecules. Progress included:
-- Phase 2 trials were conducted for the inhaled antibiotics
(amikacin) product candidate;
-- The Amphotericin B Inhalation Powder (ABIP) product candidate
was granted orphan drug designation in the U.S. and EU; and
fast-track designation in the U.S.; and
-- A human proof-of-concept trial was completed for a pain-related
product candidate under development with the company's
PEGylation technology.
-- Product candidates were also advanced in the company's partner
pipeline, where leading pharmaceutical and biotechnology companies
have created unique products using Nektar pulmonary or PEGylation
technology. Progress included:
-- UCB's Cimzia for Crohn's disease was filed for regulatory
approval in the U.S. and EU;
-- Affymax, Inc., initiated and completed a Phase 2 clinical trial
of Hematide(TM) to treat anemia in cancer patients; and
-- Zelos Therapeutics' inhaled parathyroid hormone-analogue for
osteoporosis entered Phase 1 trials.
About Nektar Pulmonary Technology
The company's Pulmonary Technology uses innovative molecular formulations and novel inhalers designed for ease-of-use to improve or enable administration of medicines to and through the lungs for both lung diseases and systemic conditions. Nektar has two proprietary pulmonary anti-infective products currently in clinical development and four additional pulmonary products in the clinic with various partners. Exubera, which has been approved in the U.S., EU, Brazil and Mexico, is the first approved product using Nektar Pulmonary Technology and is the result of a developmental collaboration between Pfizer Inc and Nektar.
About Nektar PEGylation Technology
The company's PEGylation Technology has the potential to minimize the invasiveness and improve the safety and efficacy of therapeutic agents by increasing drug circulation time in the bloodstream, decreasing immunogenicity and dosing frequency, increasing bioavailability and improving drug solubility and stability. It is based on the use of non-toxic polyethylene glycol (PEG) polymers, which can be attached to most major drug classes, including proteins, peptides, antibody fragments, small molecules, and other drugs and is used in eight approved products in the U.S. and/or Europe today. Two other products using Nektar PEGylation have been filed for approval by Nektar partners in both the U.S. and the EU, including UCB's Cimzia(TM) for Crohn's Disease.
Conference Call Information
Mr. Howard W. Robin, president and chief executive officer, will host a conference call today for analysts and investors beginning at 2:00 p.m. Pacific Time, to discuss further the company's performance.
Investors can access a live audio-only webcast through a link that is posted on the Investor Relations section of Nektar's website at nektar.com. The web broadcast of the conference call will be available for replay through March 14, 2007.
Analysts and investors can also access the conference call live via telephone by dialing 800-640-9765 (U.S.); 1-847-413-4837 (international). The passcode is 17025300 and the host is Mr. Howard Robin. An audio replay will be available shortly following the call through March 14, 2007 and can be accessed by dialing 877-213-9653 (U.S.); or 1-630-652-3041 (international) with a passcode of 17025300. In the event that any non-GAAP financial measure is discussed on the conference call that is not described in the press release, related information will be made available on the Investor Relations page at the Nektar website as soon as practical after the conclusion of the conference call.<<
snip
This is in line wrt EPS, but a bit of beat on revenues. Guidance appears to be a bit higher than consensus, as well. The stock is recovering somewhat after hours. Given all the negativity of late -- in part the fact that Pfizer's upgrading of their sales effort to a half court press hasn't resulted in an exponential and immediate rise in scrips -- upgrades are probably unlikely, but we may at least get some estimate revisions. Sure hope we bottomed today. Not too upset by Chess' compensation. He id have to do more than he bargained for for a while.
Cheers, Tuck |
