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Friday November 6, 6:28 pm Eastern Time
Company Press Release
SOURCE: Celgene Corporation
Celgene Corporation Announces Third Quarter Results
WARREN, N.J., Nov. 6 /PRNewswire/ -- Celgene Corporation (Nasdaq: CELG - news) today announced results for the third quarter ended September 30, 1998. The Company reported a net loss of $8.0 million or $.49 per share compared with $7.2 million or $.58 per share for the third quarter 1997, which included losses equal to $.03 per share related to discontinued operations. Revenue for the third quarter was $1.1 million compared with $284,000 recorded in the same period in 1997. The 1998 third quarter revenue reflected the Company's initial sales of THALOMID(TM) (thalidomide) which began shipping on September 29, 1998.
''We are delighted to record sales of our first pharmaceutical product,'' noted John W. Jackson, Chairman and CEO of Celgene. ''The number of participating pharmacies and physicians under our comprehensive S.T.E.P.S.(TM) program (System for Thalidomide Education and Prescribing Safety) is growing as planned in the fourth quarter. We are receiving interest and demand from key oncology institutions such as The Mayo Clinic, UCSD, University of Arkansas, The Cleveland Clinic, Duke and MD Anderson. Over 2,000 physicians and over 2,000 pharmacists have signed up for our S.T.E.P.S. program. Additionally, key outlets such as Rite Aid, CVS, Walgreens, Caremark and Eckerd Drug have signed on to distribute THALOMID.''
Total revenues for the first nine months of 1998 were slightly over $1.1 million comprising THALOMID sales and $105,000 of research contract income. Revenues for the same period in 1997 were $807,000 and were entirely from research contracts. The net loss for the year to date was $16.7 million or $1.04 per share compared with a loss of $19.0 million or $1.63 per share for the same period in 1997, which included losses from discontinued operations equal to $.O6 per share. Current year results reflect a gain of $7.0 million ($.44 per share) on the sale of Celgene's Chiral Intermediate business to Cambrex Corporation in January 1998.
Research and development costs for the first nine months of 1998 were $14.0 million up 12% over prior year reflecting the expanded efforts in the Company's immunotherapeutic programs, the costs of preclinical and clinical trials related to the development of d-methylphenidate, a chirally pure version of di-methylphenidate (Ritalin(R)), and the costs associated with research on chirally pure agricultural chemicals.
Selling, general and administrative costs of $11.2 million for the year to date were significantly higher than the $5.5 million for the first nine months of 1997. The higher costs reflect the addition of a Medical Affairs Department, a sales and marketing organization, sales force training and product launch expenses all related to the third quarter market introduction of THALOMID.
The Company signed a marketing agreement in early July with Biovail Laboratories Incorporated granting Biovail exclusive Canadian marketing rights for d-methylphenidate being developed by Celgene. Under the terms of the agreement, Biovail purchased $2.5 million of Celgene stock for $12.50 per share, a 25% premium to the then market price. In addition, Celgene is entitled to licensing fees on achieving certain development milestones, and royalties upon commercialization of the product.
On July 16, 1998 Celgene received final clearance from the U.S. Food and Drug Administration to market THALOMID(TM) (thalidomide) for the treatment of erythema nodosum leprosum (ENL), a severe and debilitating condition associated with leprosy. The Company commercially launched the product during the last week of September. Trials are ongoing with THALOMID in cancer, AIDS related disease states, Crohn's and other serious disease states.
Sol J. Barer, Ph.D., President and COO added, ''During the third quarter we also continued to advance our strategic objectives with the addition of new patents for our novel immunomodulatory IMiDs(TM) compounds; the completion of Phase I clinical study for our lead SelCID(TM) TNF alpha and phosphodiesterase IV (PDE4) inhibitor, CDC801; the establishment of an Orphan Drug designation for THALOMID for the treatment of multiple myeloma following the announcement of encouraging new clinical data; the commencement of Phase III pivotal clinical studies for d-methylphenidate; and the securing of two important chiral agrochemical agreements for our Celgro Division.''
Celgene Corporation, headquartered in Warren, NJ is engaged in the development of pharmaceuticals and agrochemicals.
This release contains certain forward-looking statements which involve known and unknown risks, delays, uncertainties and other factors not under the Company's control which may cause actual results, performance or achievements of the Company to be materially different from the results, performance or other expectations implied by these forward-looking statements. These factors include actions by the FDA and other regulatory authorities, and those factors detailed in the Company's filings with the Securities and Exchange Commission such as 10K, 10Q, and 8K reports.
Celgene Corporation
Condensed Statement of Operations
(Unaudited)
Nine Month Period Ended September 30,
1998 1997
Revenues:
Product Sales $1,030,838 $ --
Research contracts 105,000 807,068
Total revenues 1,135,838 807,068
Expenses:
Cost of Goods Sold 59,270 --
Research and development 13,968,657 12,419,691
Selling, general and
administrative 11,207,326 5,533,113
25,235,253 17,962,804
Operating Loss (24,099,415) (17,146,736)
Interest Income 497,100 441,436
Interest Expense 45,192 104,866
Loss from Continuing
Operations (23,647,507) (16,809,166)
Discontinued Operations:
Loss from Operations (59,837) (746,075)
Gain on Sale of
Chiral Assets 7,014,830 --
Net Income (Loss) (16,692,514) (17,555,241)
Accretion of premium payable
on Preferred stock 24,648 474,317
Deemed Dividend on
preferred shares -- 953,077
Net Income (Loss) applicable
to common Shareholders $(16,717,162) $(18,982,836)
Earnings (Loss) per share of Common Stock
Basic and Diluted per share:
Loss from Continuing Operations$(1.47) $(1.44)
Discontinued Operations:
Loss from Operations $(0.00) $(0.06)
Gain on Sale of Chiral Assets $0.44 $ --
Net Income (Loss) applicable to
common shareholders per basic
share at common stock $(1.04) $(1.63)
Weighted average number
of shares of common stock
outstanding 16,062,000 11,647,000
Celgene Corporation
Condensed Statement of Operations
(Unaudited)
Three Month Period Ended September 30,
1998 1997
Revenues:
Product Sales $1,030,838 $--
Research contracts 25,000 283,986
Total revenues 1,055,838 283,986
Expenses:
Cost Of Goods Sold 59,270 --
Research and development 5,238,106 3,899,085
Selling, general and
administrative 3,876,150 2,165,978
9,173,526 6,065,063
Operating Loss (8,117,688) (5,781,077)
Interest Income 136,262 99,034
Interest Expense 39,086 10,377
Loss from Continuing
Operations (8,020,512) (5,692,420)
Discontinued Operations:
Loss from Operations -- (406,490)
Net Income (Loss) (8,020,512) (6,098,910)
Accretion of premium payable
on preferred stock -- 158,675
Deemed Dividend on preferred shares-- 893,510
Net Income (Loss) applicable
to common shareholders $(8,020,512) $(7,151,095)
Earnings (Loss) per share of Common Stock
Basic and Diluted per share:
Loss from Continuing operations$(0.49) $(0.46)
Discontinued Operations:
Loss from Operations $ -- $(0.03)
Net Income (Loss) applicable
to common shareholders per
basic share of common stock $(0.49) $(0.58)
Weighted average number
of shares of common stock
outstanding 16,399,000 12,362,000
Celgene Corporation
Condensed Balance Sheet
(Unaudited)
September 30 December 31
1998 1997
Assets
Cash, Cash Equivalents and
Marketable Securities $12,298,173 $13,583,445
Receivables 1,042,321 1,430,384
Inventory 317,437 --
Other Assets 223,618 353,266
Assets Held for Disposal -- 485,170
Current Assets 13,881,549 15,852,265
Plant & Equipment, Net 2,355,553 2,286,024
Other 79,167 79,167
Total Assets $16,316,269 $18,217,456
Liabilities & Equity
Accounts Payable $1,975,067 $842,262
Accrued Expenses 2,080,458 1,248,762
Capitalized Lease Obligations 225,372 210,499
Other Current Liabilities 159,710 140,171
Current Liabilities 4,440,606 2,441,694
Capitalized Lease Obligation
- Net of Current Portion 266,376 350,670
Long Term Debt 8,312,500 --
Total Liabilities 13,019,482 2,792,364
Preferred Stock -- 4,029,455
Common Stock 164,131 164,279
Paid in Capital 139,370,358 130,838,433
Retained Deficit (136,237,703) (119,520,540)
Treasury Stock and
Other Equity -- (76,535)
Total Stockholders' Equity 3,296,786 15,425,092
$16,316,269 $18,217,456
Working Capital $9,440,943 $13,410,571
SOURCE: Celgene Corporation
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