Cell Genesys Reports Third Quarter Financial Results
Monday October 21, 4:01 pm ET
Ends Quarter With $205.9 Million in Cash
FOSTER CITY, Calif., Oct. 21 /PRNewswire-FirstCall/ -- Cell Genesys, Inc. (Nasdaq: CEGE - News) reported a net loss of $12.7 million, or $0.35 per share, for the quarter ended September 30, 2002. This compares with a net loss of $22.4 million, or $0.64 per share, in the same quarter of 2001. The decrease in net loss is due primarily to the nonrecurring charge of $18 million in the third quarter of 2001 relating to the acquisition of Calydon, Inc. -- an acquisition which added a third product platform, oncolytic virus therapies, to Cell Genesys. Cell Genesys ended the quarter with approximately $205.9 million in cash, cash equivalents and short-term investments.
Revenues for the quarter ended September 30, 2002 were $1.5 million compared with $4.6 million for the comparable period in 2001. The decrease in revenues relates primarily to the timing of amounts recognized under certain collaborations. Year to date revenues of $37.2 million compare favorably to revenues of $14.6 million for the comparable period in 2001 -- an increase which can be primarily attributed to revenue from a license agreement with Transkaryotic Therapies, Inc. for the company's gene activation technology. The company's research and development costs for the quarter were $19.5 million, compared with $12.4 million for the third quarter of 2001, an increase that can be attributed principally to the company's expanding clinical trials and other product development activities in both its GVAX® cancer vaccine and oncolytic virus therapy programs. Capital expenditures for the first nine months of 2002, relating primarily to the construction of manufacturing facilities for Phase III trials and market launch, were approximately $39.7 million.
"Cell Genesys continues to pursue multiple clinical stage programs in parallel, including our lead program, GVAX® prostate cancer vaccine, which is on track to enter Phase III clinical trials by mid-2003," stated Stephen A. Sherwin, M.D., chairman and chief executive officer of Cell Genesys. "Our financial position remains strong, and we are grateful to have the resources we need to advance our key product programs toward late-stage clinical trials."
Third Quarter 2002 and Other Recent Highlights:
Reported updated long term survival data at the CaPCURE Scientific Retreat from the initial multicenter Phase II trial of GVAX® prostate cancer vaccine in patients with hormone refractory prostate cancer metastatic to bone. In the 34-patient study, five of 10 (50 percent) patients receiving the higher of two dose levels of the vaccine remain alive 2.5 years after treatment (median survival = 31 months). Of the 24 patients receiving the lower dose of the vaccine, seven of 22 patients (32 percent) remain alive 2.5 years after treatment (median survival = 22 months), and two were lost to follow-up. These results compare favorably to reported median survival of seven to 11 months for hormone refractory prostate cancer patients with bone metastases treated with chemotherapy. Based on these encouraging data, Cell Genesys expects to initiate a Phase III clinical trial by mid-2003.
Announced that the company reacquired full commercial rights to GVAX® lung cancer vaccines following the termination of its remaining license agreement with the pharmaceutical division of Japan Tobacco (JT). Cell Genesys expects the near-term revenue impact to be minimal and now holds all worldwide commercial rights to its entire portfolio of GVAX® cancer vaccine products.
Announced the issuance of a broad patent that includes specific composition of matter claims pertaining to the company's proprietary oncolytic virus therapies. The patent covers adenovirus-derived oncolytic viruses that are genetically engineered to have at least two different, cell type-specific gene switches referred to as transcriptional regulatory elements (TREs), elements that serve a key role in restricting viral replication to certain, desired cell types.
Announced the promotion of three current members of the executive team to Senior Vice President -- Michael W. Ramsay to senior vice president of manufacturing operations, Robert H. Tidwell to senior vice president of corporate development and Peter K. Working, Ph.D. to senior vice president of research and development.
Cell Genesys is focused on the development and commercialization of innovative therapeutic products for cancer based on gene therapy technologies. The company is pursuing three cancer product platforms -- GVAX® cancer vaccines, oncolytic virus therapies and in vivo cancer gene therapies. Clinical trials of GVAX® vaccines are under way in prostate cancer, lung cancer, pancreatic cancer, leukemia and myeloma. Clinical trials of oncolytic virus therapies include CG7060 and CG7870 in prostate cancer. Preclinical stage programs include oncolytic virus therapies and gene therapies for multiple types of cancer. Cell Genesys' majority-owned subsidiary, Ceregene, Inc., is focused on gene therapies for neurologic disorders. Cell Genesys also continues to hold approximately nine million shares of common stock in its former subsidiary, Abgenix, Inc., an antibody products company. Cell Genesys is headquartered in Foster City, CA and has manufacturing operations in San Diego, CA, Hayward, CA and Memphis, TN. For additional information, please visit the company's website at www.cellgenesys.com.
Cell Genesys will host its quarterly conference call to discuss events that occurred during the third quarter of 2002 at 11:30 a.m. EDT on Tuesday, October 22, 2002. Investors may listen to the webcast of the conference call live on Cell Genesys' website. A replay of the webcast will be available for at least 48 hours following the call. Alternatively, investors may listen to a replay of the call by dialing 800-475-6701 from locations in the U.S. and 320-365-3844 from outside the U.S. The call-in replay will be available for 48 hours following the call. Please refer to access number 656456.
Statements made herein about the company and its subsidiaries, other than statements of historical fact, including statements about the application of the company's financial assets, progress reports and plans for clinical trials, the company's progress and results and timing of clinical trials and preclinical programs and the nature of product pipelines are forward-looking statements and are subject to a number of uncertainties that could cause actual results to differ materially from the statements made, including risks associated with the success of research and development programs, clinical trials, the regulatory approval process for clinical trials, competitive technologies and products, patents, continuation of corporate partnerships and the need for additional financings. For information about these and other risks which may affect Cell Genesys, please see the company's Annual Report on Form 10-K dated April 1, 2002 as well as Cell Genesys' reports on Form 10-Q and 8-K and other reports filed from time to time with the Securities and Exchange Commission. The company assumes no obligation to update the forward-looking information in this press release.
SELECTED FINANCIAL INFORMATION
(unaudited)
STATEMENTS OF OPERATIONS
Three months ended Nine months ended
(in thousands except
per share data) Sept. 30, Sept. 30,
2002 2001 2002 2001
Revenue $1,476 $4,635 $37,173 $14,646
Operating expenses:
Research and
development 19,490 12,362 53,853 34,122
General and
administrative 3,370 2,786 11,376 8,302
Purchased
in-process
technology (186) 18,042 (186) 18,042
Total operating
expenses 22,674 33,190 65,043 60,466
Interest and other
income 2,649 2,857 7,231 13,723
Interest expense (72) (96) (917) (222)
Net loss before
minority interest
and income tax (18,621) (25,794) (21,556) (32,319)
Income attributed
to minority
interest -- 68 96 67
Loss before
income tax (18,621) (25,726) (21,460) (32,252)
Benefit for
income tax 5,909 3,342 6,411 4,973
Net loss $(12,712) $(22,384) $(15,049) $(27,279)
Basic and
diluted loss
per common
share $(0.35) $(0.64) $(0.42) $(0.79)
Weighted average
shares of common
stock
outstanding -
basic and diluted 35,830 34,836 35,700 34,478
CONDENSED BALANCE SHEETS
(in thousands)
09/30/2002 12/31/2001
Cash, cash equivalents and
short-term investments $205,933 $258,649
Investment in TKT common stock 15,000 --
Investment in Abgenix common stock 58,112 301,217
Other current assets 2,909 10,603
Property and equipment, net 81,422 43,217
Other assets 1,334 1,624
Total assets $364,710 $615,310
Current liabilities $63,922 $149,690
Long-term obligations 53,962 60,000
Minority interest in equity of subsidiary -- 96
Series B preferred stock 15,565 17,970
Stockholders' equity 231,261 387,554
Total liabilities and stockholders'
equity $364,710 $615,310
CONTACT: Jennifer Cook Williams, Associate Director of Corporate Communications, +1-650-425-4542.
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Source: Cell Genesys, Inc. |
