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Tuesday April 27, 4:14 pm Eastern Time
Company Press Release
SOURCE: PathoGenesis Corp.
PathoGenesis Corp. Reports First Quarter 1999 Results
SEATTLE, April 27 /PRNewswire/ -- PathoGenesis Corp. (Nasdaq: PGNS - news) today reported results for the first quarter of 1999.
For the quarter ended March 31, 1999, PathoGenesis reported a net loss of $4.7 million, or 29 cents per basic and diluted share. In the first quarter of 1998, the company had net income of $985,000, or six cents per basic and diluted share.
Revenues for the first quarter of this year were $10.3 million, including sales of $10.1 million from TOBI® (tobramycin solution for inhalation), PathoGenesis' first drug. These results were in line with the expected outcome for the quarter, as announced last month. Net revenues for the same quarter a year ago were $14.7 million, including TOBI sales of $14.5 million.
''We are moving forward with a number of programs to further TOBI's acceptance in the U.S. cystic fibrosis market,'' said Wilbur H. Gantz, chairman and chief executive officer. ''For example, we are making more calls on physicians, thanks in part to seven sales people we hired this past quarter. In addition, we are facilitating physician-to-physician contacts so that doctors who are prescribing TOBI widely can explain their positive experience to their colleagues. We recently distributed slides to physicians that include important data from January's article on TOBI in The New England Journal of Medicine. We also plan to increase our communications with cystic fibrosis patients and their families via case studies, patient newsletters and other media.''
For the first quarter of 1999, PathoGenesis' cost of sales was $2.2 million, versus $2.7 million for the same period a year ago. The company reported $6.5 million in selling, general and administrative expenses for the current quarter, an 18 percent increase from $5.5 million in the year-earlier period. The increase was due in part to a planned expansion of the sales force in the U.S. and preparations for market launch of TOBI in Canada this quarter and in the U.K. upon regulatory approval. First quarter 1999 research and development costs were $6.8 million, compared with $6.6 million in the first quarter of 1998.
In the first quarter of 1999, TOBI was approved for sale by the regulatory authorities in Canada and Argentina. An application for approval of TOBI was filed in Australia, where the PathoGenesis antibiotic has orphan drug status. TOBI is under review in the U.K., which is the lead country for regulatory approval in Europe. In addition, PathoGenesis recently began to enroll patients in a 28-day, open-label, randomized clinical trial of 120 cystic fibrosis patients in the U.K. and Ireland. The trial is not required for regulatory approval but will give physicians additional information on the use of TOBI.
Yesterday, PathoGenesis reported additional results from its Phase II clinical trial of TOBI in patients with bronchiectasis. Important findings included a more than 99.999 percent reduction in density of P. aeruginosa bacteria in the sputum (phlegm) at 14 and 28 days, as well as eradication of P. aeruginosa in the sputum in 32 percent of patients as of two weeks after stopping TOBI therapy. TOBI's ability to reduce or eliminate pseudomonal bacteria in the sputum was correlated with improvement in the patients' general health. More patients on TOBI than on placebo reported shortness of breath, wheezing and non-cardiac chest pain. These are symptoms that can be associated with bronchiectasis.
At March 31, 1999, PathoGenesis had cash and marketable securities of $51.1 million, compared with $67.8 million at the end of the first quarter last year.
Seattle-based PathoGenesis Corp. is a pharmaceutical company that develops drugs to treat chronic infectious diseases -- lung infections, in particular -- where there is a significant need for improved therapy. The company markets TOBI, an inhaled antibiotic, in the U.S. and other countries for management of Pseudomonas aeruginosa infections in patients with cystic fibrosis. In addition, PathoGenesis is developing other drug candidates to treat serious chronic lung infections, including those common in cystic fibrosis, bronchiectasis and tuberculosis patients. PathoGenesis' stock is traded on the Nasdaq National Market under the symbol PGNS. The company's Web site is located at www.pathogenesis.com.
Note: This news release contains ''forward-looking statements'' within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to known and unknown risks, uncertainties or other factors that may cause the company's actual results to be materially different from historical results or any results expressed or implied by such forward-looking statements. Factors that might cause such a difference include, but are not limited to, uncertainties related to the fact that PathoGenesis only began commercial operations in 1998, its dependence on TOBI, the degree of penetration of its markets and frequency of TOBI's use by patients, third party reimbursement and product pricing, seasonal impacts on hospitalizations or exacerbations experienced by cystic fibrosis patients, variability in wholesaler ordering patterns, drug development and clinical trials, competition and alternative therapies, and other factors described in PathoGenesis' filings with the Securities and Exchange Commission, including the company's Form 10-K for 1998 and Exhibit 99.1 to that Form 10-K
PathoGenesis Corp.
Consolidated Statements of Operations
(Dollars in thousands, except per share data)
Three Months Ended
March 31, 1999 March 31, 1998
Revenues:
Sales $10,056 $14,527
Grants and royalties 204 138
10,260 14,665
Operating expenses:
Cost of sales 2,202 2,670
Research and development 6,840 6,575
Selling, general and administrative 6,538 5,533
Total operating expenses 15,580 14,778
Operating loss (5,320) (113)
Other income (expense):
Investment income, net 827 1,132
Interest expense (218) --
Other expense (27) (34)
Net other income 582 1,098
Net income (loss) (4,738) $985
Income (loss) per common share
-- basic and diluted (0.29) $0.06
Weighted average common shares outstanding: *
Basic 16,378,828 16,243,147
Diluted 16,378,828 17,146,495
Balance Sheet Highlights
(in thousands) March 31, 1999 Dec. 31, 1998
Cash, cash equivalents and
investment securities $51,145 $55,008
Total current assets 70,895 79,784
Total assets 104,668 112,766
Total current liabilities 10,443 14,631
Long-term liability 4,826 4,725
Total stockholders' equity 89,400 93,410
* In the first quarter of 1999, net loss per share assuming dilution is
the same as basic net loss per share, since shares issuable for stock
options and warrants would be anti-dilutive.
SOURCE: PathoGenesis Corp.
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