Tuesday October 28 6:18 PM EST
Company Press Release
The Liposome Company Reports Third Quarter Operating Results
PRINCETON, N.J., Oct. 28 /PRNewswire/ -- The Liposome Company, Inc. (Nasdaq:LIPO) today reported financial results for the third quarter ended
September 28, 1997. Total revenues for the quarter were $16,050,000 compared to $14,910,000 for the third quarter of 1996. Year to date revenues for the nine
month period were $48,558,000 compared to $41,721,000 for the first nine months of 1996.
At September 28, 1997, the Company had $50,105,000 in cash and marketable securities.
''The Liposome Company has continued to make progress in developing its oncology franchise,'' said Charles A. Baker, Chairman and Chief Executive Officer.
''Worldwide unit shipments of ABELCET(R) increased by a strong 28 percent over the comparable prior year quarter. These results were achieved despite the
presence of significant amounts of free product available from a competitor in the United States market and the loss of two wholesalers through consolidation thus
potentially reducing the amount of ABELCET(R) in the distribution pipeline. U.S. revenues, however, were significantly impacted by the Company's implementation
of an aggressive program in response to a competitor's pricing reduction earlier in the year. Despite the competition, we remain the leader in this important market,
and we intend to retain that position.''
Mr. Baker continued, ''During the quarter the Company had several other accomplishments. ABELCET(R) was launched in Canada, where it is the only approved
lipid-based amphotericin B formulation. Furthermore, we were very encouraged by the new relationship with Wyeth-Ayerst in France and Italy to market
ABELCET(R). We will have a far greater presence in those markets through Wyeth-Ayerst than we could have developed over the short term on their own.
Launches in both countries are expected during the fourth quarter.
''On other fronts, patient accrual in the two U.S. phase III clinical studies of TLC D-99 is continuing on track. The transition of the management of these studies
from Pfizer to The Liposome Company is proceeding smoothly. Financially, our total expenses have been held to small increases, and the Company's balance sheet
is solid. Receivables are modest, inventory levels are declining, and we have both a good cash position and minimal debt.''
Total expenses in the third quarter were $22,253,000 compared to $20,262,000 in the comparable prior year quarter. Cost of sales increased to $7,091,000, or
54 percent of product sales, primarily due to the expensing of certain manufacturing costs as part of the Company's previously announced program to reduce
inventories to more optimal levels. Gross margins are expected to improve in the fourth quarter.
Research and development expenses of $6,627,000 declined from the comparable 1996 quarter spending of $8,955,000. The decline was primarily attributable to
the absence of pre-production costs at the Company's Indianapolis manufacturing facility that were incurred during the 1996 quarter. Selling and administrative
expenses of $8,366,000 were $1,461,000 above the comparable 1996 quarter as a result of remaining expenses related to litigation that has how been settled, and
greater selling expenses, particularly for the increased size of the U.S. sales force.
Net loss for the quarter was $6,203,000, or $.17 per share, compared to a loss of $5,354,000, or $.16 per share, in the comparable 1996 quarter. The year to
date net loss applicable to common stock was $19,222,000, or $.52 per share, including $3,900,000 of charges related to a corporate restructuring and other
one-time items incurred during the second quarter. The net loss for the 1996 nine month period was $15,808,000, or $.49 per share.
Inventories of $13,732,000 have declined substantially from the second quarter level. The Company had planned increases in inventories during the first half of 1997
as part of the transition of its commercial manufacturing from Princeton to Indianapolis. In addition, the Company experienced high production yields at both
facilities. The Indianapolis facility has received FDA approval and all manufacturing has been transferred to Indianapolis. Further inventory reductions are expected
to be achieved by year end.
The Liposome Company is a broad-based biopharmaceutical company developing and marketing products based on its knowledge of lipid technology.
ABELCET(R) (Amphotericin B Lipid Complex Injection) is marketed in the U.S. and other countries for the treatment of severe systemic fungal infections. TLC
D-99 and other products are being developed to treat various cancers. Research is being conducted on new cancer therapies and biologically active lipids that may
have therapeutic applications.
Except for historical information, this press release contains forward- looking statements that involve risks and uncertainties, including but not limited to statements
regarding the ability of ABELCET(R) to retain its leading position in the U.S. market, the timing of launches of ABELCET(R) in France and Italy, the expected
improvement in product gross margins, and the further reduction of inventories. While those statements reflect the Company's best current judgment, they are subject
to risks and uncertainties that could cause actual results to vary, including the risk factors identified in the Registration Statement on Form S-3 dated September 30,
1997 and from time to time in the Company's other SEC filings.
This release is also available at lipo.com
THE LIPOSOME COMPANY, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(In Thousands Except Per Share Figures)
(Unaudited)
Three Months Ended Nine Months Ended
9/28/97 9/29/96 9/28/97 9/29/96
Product sales $13,115 $13,799 $42,740 $36,369
Research and development revenues 531 610 2,331 2,502
Interest, investment and
other income 2,404 501 3,487 2,850
Total revenues 16,050 14,910 48,558 41,721
Cost of goods sold 7,091 4,347 15,621 11,611
Research and development expense 6,627 8,955 21,470 24,190
Selling, general and
administrative expense 8,366 6,905 30,141 20,318
Interest expense 169 55 548 175
Total expenses 22,253 20,262 67,780 56,294
Net loss (6,203) (5,352) (19,222) (14,573)
Preferred Stock dividends -- 2 -- 1,235
Net loss applicable to
Common Stock $(6,203) $(5,354) $(19,222) $(15,808)
Net loss per share applicable to
Common Stock $(0.17) $(0.16) $(0.52) $(0.49)
Weighted average number of common
shares outstanding 37,455 33,671 36,850 32,452
THE LIPOSOME COMPANY, INC.
Condensed Consolidated Balance Sheets
(In Thousands)
(Unaudited)
September 28, 1997 December 29, 1996
Cash and short-term investments $35,175 $30,110
Accounts receivable 5,255 7,884
Inventories 13,732 9,904
Other current assets 796 882
Long-term investments 3,000 10,140
Property, plant and equipment, net 26,153 28,292
Restricted cash 11,930 6,930
Other assets, net 371 413
Total assets $96,412 $94,555
Current liabilities $10,581 $12,139
Other liabilities 5,694 7,555
Stockholders' equity 80,137 74,861
Total liabilities and stockholders'
equity 96,412 94,555 |
