Vertex Pharmaceuticals Reports Third Quarter 2001 Financial Results
CAMBRIDGE, Mass., Oct. 24 /PRNewswire/ -- Vertex Pharmaceuticals Incorporated (Nasdaq: VRTX - news) reported consolidated financial results today for the three and nine months ended September 30, 2001. Results for all periods presented include the acquisition of Aurora Biosciences, completed in July 2001, which was accounted for as a pooling of interests.
For the three months ending September 30, 2001, the Company's net loss, before merger related costs and non-recurring charges and gains, was $13,478,000, or $0.18 per basic and diluted share, compared to a net loss, before merger related costs and non-recurring charges and gains, of $5,849,000, or $0.09 per basic and diluted share, for the same period last year. Total revenues for the third quarter of 2001 were $40,368,000, as compared to $36,850,000 for the third quarter of 2000. Total costs and expenses, before merger related costs and non-recurring charges and gains, for the third quarter of 2001 were $53,846,000 versus total costs and expenses, before merger related costs and non-recurring charges and gains, of $42,699,000 for the third quarter of 2000. As of September 30, 2001, Vertex had approximately $730,327,000 in cash, cash equivalents and available for sale securities.
Vertex's financial results fluctuate from quarter to quarter based on the timing of royalty revenue, collaborative revenue, and external research and development expenses.
``During the third quarter of 2001, Vertex strengthened its senior management team with several key appointments, and we continued to make progress with our drug discovery and development programs,'' said Joshua Boger, Ph.D., Chairman and CEO of Vertex Pharmaceuticals. ``In addition, the completion of Vertex's acquisition of Aurora Biosciences allows us to utilize Aurora's strength in cell biology as we move forward to develop novel drugs that treat areas of large medical needs. With our strong cash position and more than 25 collaborations with pharmaceutical and life science partners, we look forward to the advancement of our pipeline and the addition of new drug candidates into development in the months ahead.''
* Review of Third Quarter 2001 Corporate Events and Pipeline Update
* Corporate and Commercial Milestones
* Vertex completed its acquisition of Aurora Biosciences during the
quarter. The merger unites Aurora's industry-leading assay development,
screening and cell biology capabilities with Vertex's integrated drug
discovery expertise. The combination of Vertex's and Aurora's
technology and expertise is expected to increase the flow of novel drug
candidates into development and accelerate the expansion of our broad
intellectual property estate.
* Vertex strengthened its management team with three key appointments. -- Kenneth Boger was named Senior Vice President and General Counsel of
Vertex. Mr. Boger joined Vertex from the law firm Kirkpatrick &
Lockhart LLP, where he served on the firm's Management Committee.
Mr. Boger has served as one of the Company's external counsel since
1989.
* Michael Wokasch was named President of Vertex's subsidiary, PanVera. Mr. Wokasch joined PanVera from Gala Design, Inc., a biotechnology start-up company that has proprietary technology in the production of pharmaceutical proteins. Prior to Gala Design, Mr. Wokasch served as Vice President, Marketing and Sales, at Promega Corporation where he re-engineered its sales and marketing team and implemented a process for global marketing planning.
* Thierry Hercend, M.D., Ph.D., Vice President of Research for Vertex Pharmaceuticals Europe, was named to the additional position of Program Executive, Kinases. In this position, Dr. Hercend has assumed overall responsibility for Vertex's ongoing progress in its kinase alliance with Novartis.
* Vertex announced the installation of a new supercomputer cluster; one of
the most powerful in the world dedicated to in silico drug design
applications. The new cluster represents a key component of the
technology infrastructure that is expected to accelerate productivity in
Vertex's gene family-based drug discovery research.
* The Company entered into a collaboration with Array BioPharma in
September to discover and develop small molecule drugs directed at two
specific targets in the phosphatase protein family. This collaboration
enables Vertex to explore the applicability of parallel drug design in
the phosphatase gene family, a family of proteins that are believed to
contain numerous specific targets that are suitable for small molecule
drug design.
* The Company also entered into several agreements during the quarter to
access specialized technologies that will enhance and broaden Vertex's
drug discovery activities, such as an agreement with Cellomics for its
ArrayScan HCS System, which provides reliable insight into the efficacy
and toxicity of drug candidates, and an agreement with Consensus
Pharmaceuticals to gain information on protease targets.
Report on Aurora Biosciences
* During the third quarter, Aurora Biosciences entered into an agreement
with Amersham Pharmacia Biotech to commercialize their combined Green
Fluorescent Protein (GFP) technology, which is used to accelerate drug
discovery and development. The commercial agreement will allow both
companies to broaden access to GFP technology by pharmaceutical
companies, biotechnology companies, and academic research institutions.
* In addition, Aurora entered into a two-year collaboration and license
agreement with Hyseq, Inc. to leverage Aurora's unique drug discovery
tools and Hyseq's gene database to develop small molecule drug
candidates and therapeutic protein candidates.
Pipeline Progress Update
HIV Protease Program: Agenerase and GW433908 (VX-175)
* GW433908 (VX-175), also known as 908, is a prodrug of the HIV protease
inhibitor amprenavir. Vertex's partner, GlaxoSmithKline (GSK), is
currently conducting three Phase III clinical trials of GW433908 and
intends to file a New Drug Application (NDA) for GW433908 in 2002.
Phase II data show the drug is well-tolerated, and has potent
antiviral activity.
* Agenerase(R) (amprenavir) is an HIV protease inhibitor discovered by
Vertex and licensed for development and commercialization to GSK. The
drug is approved in more than 35 countries worldwide, including recent
approvals in Nigeria, Slovenia, Lithuania and South Africa.
P38 MAP Kinase Program: VX-745, VX-702, VX-850
* Vertex has accelerated the development of its second generation oral p38
MAP kinase inhibitors, VX-702 and VX-850. The Company expects to
initiate clinical studies with one or both of these second generation
compounds in the first half of 2002.
* During the third quarter, Vertex conducted a preliminary analysis of
Phase II clinical data of its lead orally active p38 MAP kinase
inhibitor VX-745 in the treatment of rheumatoid arthritis. In this
analysis, Vertex obtained "proof of principle" correlating inhibition of
p38 MAP kinase with a significant anti-inflammatory effect. Vertex also
found that the drug was well-tolerated. Concurrently, Vertex obtained
adverse CNS effect findings within nonclinical tests of VX-745. To
date, no CNS side effects associated with VX-745 have been observed in
human clinical trials. Based on the nonclinical findings, the Company
made a commercial decision to re-allocate its development resources in
its small molecule p38 MAP kinase inhibitor program targeting
inflammatory disease to its second generation compounds, VX-702 and VX-
850.
ICE Program: Pralnacasan/VX-740
* The Phase II clinical trial of pralnacasan (VX-740) in patients with
rheumatoid arthritis is fully enrolled, and is on track for completion
in the first half of 2002. The trial is being conducted by Vertex's
partner, Aventis Pharmaceuticals. Pralnacasan is an inhibitor of IL-1
beta converting enzyme (ICE).
Kinase Program:
* Vertex's collaboration with Novartis to discover, develop and
commercialize small molecule drugs directed at targets in the kinase
protein family is progressing on schedule and the kinase team is fully
staffed. The Company expects to select this year one or two kinase
inhibitors to move into preclinical development. These inhibitors are
expected to be the first of many novel inhibitors Vertex expects to
generate through this collaboration in the next several years.
Year 2001 Financial Outlook
This section contains forward-looking guidance about the financial outlook for the consolidated company, which includes Vertex Pharmaceuticals, Aurora Biosciences and PanVera. Full year 2001 guidance reflects the effect of the 2001 change in accounting principle on revenue recognition (See Note 3 to the financial tables).
* Net loss: Vertex expects that the 2001 net loss, before merger related
costs and non-recurring charges and gains, will be in the range of $40
to $45 million. The Company expects merger related expenses of $21.5 to
$23.5 million for the full year of 2001.
* Total Revenue: Vertex anticipates that total revenue will be in the
range of $160 to $168 million. Vertex collaborative and other research
and development revenue will continue to fluctuate based on levels of
research and development support as well as potential revenue from
milestone payments and possible new alliances.
* Total Costs and Expenses: For the full year of 2001, Vertex anticipates
that total costs and expenses will be in the range of $204 to $212
million, before merger related costs and non-recurring charges and
gains, and including other income, net. The Company expects to continue
to make significant investments in its research organization and in its
industry-leading product pipeline.
* Shares outstanding: Vertex's assumptions for weighted average number of
shares outstanding are approximately 75 million for year-end 2001.
* Cash, cash equivalents and available for sale securities: Vertex
expects to have in the range of $685-$695 million in cash, cash
equivalents and available for sale securities at the end of 2001.
* Subsequent event: Vertex retired $30 million in principal amount of
debt and will record a non-cash extraordinary gain of $10.3 million in
the fourth-quarter of 2001. From time-to-time, the Company may continue
to retire debt. |
