Headline: Genzyme Tissue Repair Announces A 56 Percent Increase In 1998 Product
Revenue
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U.S. Carticel Revenues Grow 81 Percent
CAMBRIDGE, Mass., Jan. 13 /PRNewswire/ -- Genzyme Tissue Repair
(NASDAQ:GENZL) announced today it generated record product revenues for 1998
totaling $17 million, a 56 percent increase from $11 million in 1997. Total
revenue for the fourth quarter of 1998 was $4.5 million, a 44 percent increase
from $3.1 million in the fourth quarter of 1997. All financial results
reported in this release are unaudited. Audited results will be announced on
March 3, 1999.
Increases in product revenue were led by an 81 percent growth in U.S.
sales of the company's Carticel(TM) autologous cultured chondrocytes, for the
treatment of knee cartilage damage. U.S. Carticel sales were $8.8 million for
1998, up from $4.8 million for 1997. U.S. Carticel sales for the fourth
quarter 1998 were $2.6 million, up 64 percent from $1.6 million in the fourth
quarter of 1997.
Worldwide, Carticel revenues for the fourth quarter 1998 were $3.3
million, up 49 percent from $2.2 million in the fourth quarter of 1997. Total
Carticel revenues for 1998 were $11 million, up 66 percent from $6.6 million
for 1997.
Revenue from Epicel(TM) skin grafts, a skin replacement product for severe
burns, grew to $6 million for 1998, an increase of 39 percent from $4.3
million for 1997. Revenue from Epicel for the fourth quarter 1998 was $1.25
million, up 32 percent from $.9 million in the fourth quarter of 1997.
"During 1998, we succeeded in creating a consensus about the appropriate
use of Carticel in cartilage repair," said Tim Surgenor, president of Genzyme
Tissue Repair. "The strong continued growth in Carticel treatments in the
fourth quarter of 1998 reflects this growing consensus and the emergence of
cartilage repair specialists."
Carticel Performance Indicators
The number of patients treated with Carticel grew to 1,094 in 1998, an
increase of 66 percent from 660 patients treated in 1997. During the fourth
quarter of 1998, 327 patients were treated, an increase of 50 percent from 220
patients treated in the fourth quarter of 1997.
The increase in patients treated with Carticel was led by strong growth in
the U.S. market. In 1998, 855 patients were treated in the U.S., an 80
percent increase from 476 patients treated in 1997. In the fourth quarter of
1998, 255 patients were treated in the U.S., an increase of 67 percent from
153 in the fourth quarter of 1997. The cumulative total number of patients
treated since the inception of Carticel grew
to 2,117.
Other leading indicators of the business -- surgeons trained and insurance
reimbursement approvals -- also increased substantially.
Worldwide, the number of surgeons trained during 1998 rose to 958, an 82
percent increase from 525 surgeons trained in 1997. There was a 145 percent
increase in the number of U.S. surgeons trained as the number rose to 803 in
1998, up from 328 in 1997.
Reimbursement approvals for individual patients in the U.S. grew to 1,078,
up 99 percent from 543 approvals in the U.S. in 1997. The company believes
this growth is due to the large numbers of insurance companies who now have
policy coverage for Carticel and the company's increasing rate of
effectiveness in convincing those insurance companies who do not have policy
coverage to reimburse for Carticel.
Carticel Data
The company believes that increases in product revenues, numbers of
patients identified and treated with Carticel, and the number of surgeons
trained in the Carticel procedure are due in large part to the growing
consensus in the orthopedic community that Carticel is a key element in the
treatment of cartilage damage.
This consensus has been cultivated through the company's sales and
marketing efforts as well as an increasing number of presentations at
scientific meetings and submissions of papers for publication in respected
journals. Examples include the company's sponsorship of a presentation at the
International Cartilage Repair Society symposium in November 1998, where new
data on clinical outcomes of patients treated with Carticel was presented.
Also, data from patients treated with Carticel was published in the October
26, 1998 issue of The Journal of Orthopedic and Sports Physical Therapy. The
study was conducted by Scott Gillogly, M.D. A second study of the cost-
effectiveness of Carticel was conducted by Tom Minas, M.D. and published in
the November 13, 1998 issue of the American Journal of Orthopedics.
The November/December 1998 issue of the American Journal of Sports
Medicine featured an article reviewing the latest data for Carticel and
alternative cartilage repair techniques, authored by Burt Mandelbaum, M.D. and
several other thought leaders in cartilage repair. The article recommends the
use of Carticel as first line treatment of lesions larger than 2 square
centimeters in the athletic patient, and for all patients -- regardless of
lesion size or athletic demand -- who have failed alternative therapies.
Genzyme Tissue Repair continues to implement its sales and marketing
strategy to aggressively develop high-volume usage of Carticel by surgeons in
regions where reimbursement for Carticel is easiest to obtain. In addition,
the marketing programs designed to increase patient flow to key surgeons in
these high focus markets continued to expand. The company has seen positive
results from its cooperative advertising program with leading hospitals.
Originally developed in Boston and Chicago, the company now conducts similar
programs in four other U.S. cities.
Upcoming Events
Building on the company's commitment to aggressively support presentations
at scientific meetings and submissions of papers for publication in 1999,
Genzyme Tissue Repair will release Volume 5 of its Cartilage Repair Registry
at the 1999 annual meeting of the American Association of Orthopedic Surgeons
in February. This report will provide the 3 year follow-up data on
approximately 40 patients and the 2 year follow-up data on approximately 220
patients.
The company will release its full financial earnings report for the fourth
quarter on March 3, 1999 and hold a conference call.
Additionally, effective February 15, 1999, Genzyme Tissue Repair will
change its stock symbol to GZTR. This change is being made in response to
shareholder concerns about the similarity of Genzyme Tissue Repair's current
ticker symbol (GENZL) and Genzyme General's ticker symbol (GENZ). The GZTR
stock will continue to trade on Nasdaq.
Genzyme Tissue Repair is a leading developer of biological products for
the treatment of orthopedic injuries such as cartilage damage, and severe
burns. It is a division of Genzyme Corp. and has its own common stock
intended to reflect its value and track its performance.
This press release contains forward-looking statements about expected
Carticel treatment levels, product revenues, reimbursement rates for
individual patients and surgeon training levels, potential future articles
relating to Carticel and plans to release Volume 5 of the Cartilage Repair
Registry. Actual results may differ materially depending on many factors,
including without limitation, revenue fluctuations, actual results of sales
and marketing efforts, actual levels of reimbursement approvals and surgeon
training, the ability of Genzyme Tissue Repair to maintain and cultivate
market consensus regarding the use of Carticel, whether and when additional
publications relating to Carticel are published and the actual timing of the
release of Volume 5 of the registry.
Investors can listen to a playback of a conference call discussing the
Carticel performance indicators by dialing 1-800-633-8284 in the United States
or 1-619-812-6440 elsewhere from 1 p.m. EDT today through 12 midnight EDT
January 20. Refer to reservation number 11462565.
Genzyme's releases are on the World Wide Web at genzyme.com.
They are also available from Genzyme's fax-on-demand service at 1-800-436-1443
in the United States and 1-201-521-1080 elsewhere.
Genzyme Tissue Repair
Carticel Performance Indicators
1995 1996 1997 1997 1997 1997
Total Total Q1 Q2 Q3 Q4
Patients Treated:
US 60 251 76 115 132 153
Europe/ROW 0 52 36 41 40 67
Total Patients
Treated 60 303 112 156 172 220
US Reimbursement
Activity
Third-party Coverage
(millions of lives): 15 53 101
Cum.# Payers w/Policy
Protocol 33 54 67
US Patient Approval 72 301 84 130 147 182
Surgeon Training:
US 206 749 41 90 75 122
Europe/ROW 47 461 56 58 26 57
Total Surgeons
Trained 253 1210 97 148 101 179
Genzyme Tissue Repair
Carticel Performance Indicators
1997 1998 1998 1998 1998 1998 Since
Total Q1 Q2 Q3 Q4 Total Inception
Patients Treated:
US 476 202 189 209 255 855 1642
Europe/ROW 184 46 68 53 72 239 475
Total Patients
Treated 660 248 257 262 327 1094 2117
US Reimbursement
Activity
Third-party
Coverage
(millions of
lives): 101 123 130 136 136 136 136
Cum.# Payers w/
Policy Protocol 67 73 80 86 86 86 86
US Patient
Approval 543 227 259 264 328 1078 1994
Surgeon Training
US 328 224 283 102 194 803 2086
Europe/ROW 197 26 83 1 45 155 860
Total Surgeons
Trained 525 250 366 103 239 958 2946
SOURCE Genzyme Tissue Repair
-0- 01/13/99
/CONTACT: Media: Elizabeth Heller, 617-761-8419 or Investor: Caren
Arnstein, 617-252-7635 both of Genzyme/
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