Monday December 18, 7:00 am Eastern Time
Press Release
SOURCE: OSI Pharmaceuticals, Inc.
OSI Pharmaceuticals Reports 2000 Financial Results
UNIONDALE, N.Y., Dec. 18 /PRNewswire/ -- OSI Pharmaceuticals, Inc. (Nasdaq: OSIP - news) today announced
financial results for the fiscal year ended September 30, 2000. Revenues for the year increased 26% to $28.7 million,
compared to $22.7 million in the prior year. The Company reported a net loss of $16.3 million (or ($0.67) per share) for fiscal
2000, compared with $9.8 million (or ($0.46) per share) in the prior year. OSI significantly improved its cash reserves during
the fiscal year. The Company raised over $56 million in gross proceeds in February 2000 through a private sale of equity. In
addition, and subsequent to the fiscal year end, OSI completed a public offering of its common stock at $70 per share with
gross proceeds, including the exercise of an over-allotment option, totaling $431 million. Current cash and short term
investments total approximately $485 million.
``2000 has proven to be a watershed year for OSI. The Company now has the financial resources to build upon the strong
drug discovery base we have established through funded R&D partnerships, by investing in our own pipeline of high quality
drug candidates and advancing them through clinical development,'' stated Colin Goddard, Ph.D., Chairman and Chief
Executive Officer of OSI. ``The accomplishments this year demonstrate the Company's continued commitment to building
long-term shareholder value by creating a leading biopharmaceutical company focused on the development of innovative,
small-molecule drug candidates which have the potential to impact healthcare worldwide.''
The increase in revenues in fiscal 2000 was principally due to increased funding for the Pfizer Inc/Anaderm Research
Corporation program for the discovery and development of cosmeceuticals, and the commencement of the Tanabe Seiyaku
Co. Ltd. agreement for diabetes drug discovery announced in October 1999. Research and development expenses increased
59% to $39.6 million, as compared to $25 million for 1999 and reflects the Company's increased investments in proprietary
drug discovery and development efforts, as well as expansion under the collaborative agreements. Selling, general and
administrative expenses increased approximately $2.3 million, or 26% as a result of increased business development costs
associated with OSI-774 and other corporate development activities.
Corporate Highlights for 2000
In September 2000, the Company filed a registration statement related to a public offering of its common stock. Subsequent to
its fiscal year, the Company completed the public offering of its common stock at $70 per share with gross proceeds totaling
$431 million. This total included the full exercise by the underwriters of their over-allotment option. The underwriting group
consisted of Robertson Stephens, Inc. and Lehman Brothers Inc., as joint book-running managers, and Prudential Vector
Healthcare Group a unit of Prudential Securities, Lazard Freres & Co. LLC, and Adams, Harkness & Hill, Inc. The financing
followed an earlier private placement in February 2000, in which the Company raised gross proceeds of over $56 million.
In June 2000, OSI announced that Pfizer, in order to meet U.S. Federal Trade Commission requirements for its merger with
Warner-Lambert, granted full development and marketing rights to OSI for the Company's lead anti-cancer drug candidate
OSI-774. OSI-774 is a potent, selective and orally active inhibitor of the Epidermal Growth Factor Receptor (EGFR) tyrosine
kinase, an oncogene that is associated with the aberrant growth characteristics of certain cancer cells. OSI recently reported
updated findings from two ongoing Phase II single agent open label clinical studies for OSI-774 at the European Organization
for the Research and Treatment of Cancer (EORTC) Symposium in Amsterdam. Data showed that 48% of 56 patients with
advanced, refractory non-small cell lung cancer and 42% of 78 evaluable patients with advanced head and neck cancer had
either a partial response or evidence of disease stabilization after 3 months of daily oral dosing with OSI-774. OSI-774 has
now been administered to over 300 patients.
In December 1999, OSI announced that Pfizer opened an IND for Phase I clinical trials in the United States to evaluate
CP-609,754, an anti-cancer agent which inhibits a key mediator of the functioning of the ras oncogene. In addition, drug
candidates in cancer, cosmeceuticals (with Pfizer), and cholesterol lowering and asthma (with Aventis) moved into advanced
preclinical development.
In November 1999, the Company announced the divestiture of its diagnostics business to Bayer Corporation in order to focus
on its drug discovery and development programs. OSI received approximately $9.2 million from Bayer, with additional
contingent payments of $1.25 million due in 2001. In October 1999, the Company commenced its partner funded discovery
program for diabetes with Tanabe Seiyaku. Tanabe has outsourced much of the drug discovery process to OSI and has
committed $20 million in funding. OSI received a $3.5 million technology access fee from Tanabe in September 1999.
During the fiscal year, the Company granted additional licenses to its broad-based gene transcription drug discovery patent
estate to Merck & Co., Inc. (NYSE: MRK - news), American Home Products (NYSE: AHP - news), and R.W. Johnson
Pharmaceutical Research Institute, a Johnson & Johnson (NYSE: JNJ - news) company. The Company also completed its
strategy of obtaining freedom to operate the G-protein coupled receptors (GCPR) drug discovery technology, originally
acquired from Cadus Pharmaceutical Corporation in July 1999, by signing a non-exclusive licensing agreement with Cadus in
February 2000 involving Cadus' yeast GPCR patent estate and obtaining licenses to additional GPCR and assay technologies
from American Home Products and Merck.
Several key organizational appointments were made during the fiscal year. Dr. Colin Goddard was elected Chairman of the
Board of OSI. Dr. Nicholas G. Bacopoulos joined OSI as President and Head of Research and Development and is
responsible for all of OSI's drug discovery and development activities. Dr. Bacopoulos formerly served as President and CEO
of Pfizer's Anaderm Research Corporation. Dr. Viren Mehta, founder and managing member of the investment advisory group
Mehta Partners, LLC, and Sir Mark Richmond, senior fellow at University College, London and former Head of Research and
Special Assignments, Research Directorate at Glaxo Research & Development Ltd., were elected to OSI's Board of
Directors.
OSI Pharmaceuticals is a leading biopharmaceutical company with a substantial portfolio of product opportunities for
commercialization with the pharmaceutical industry. OSI's research programs are focused in the areas of cancer therapeutics,
respiratory diseases, diabetes, and cosmeceuticals. OSI utilizes a comprehensive drug discovery and development capability to
facilitate the rapid and cost-effective discovery and development of novel, small molecule compounds against more than 40
gene targets.
Additional information on OSI Pharmaceuticals is available on the World Wide Web at: osip.com.
This news release contains forward-looking statements. These statements are subject to known and unknown risks and
uncertainties that may cause actual future experience and results to differ materially from the statements made. Factors that
might cause such a difference include, among others, uncertainties related to the identification of lead compounds, the successful
pre-clinical development thereof, the completion of clinical trials, the FDA review process and other governmental regulation,
pharmaceutical collaborators' ability to successfully develop and commercialize drug candidates, competition from other
pharmaceutical companies, product pricing and third part reimbursement, and other factors described in OSI Pharmaceuticals'
filings with the Securities and Exchange Commission. (snip) |
