SAN CARLOS, Calif.--(BW HealthWire)--Jan. 22, 1998--Inhale Therapeutic Systems (NASDAQ:INHL - news) today
announced its financial results for the fourth quarter and year ended December 31, 1997.
The Company reported contract research revenues of $4.8 million for the three months ended December 31, 1997, compared
to $2.2 million in the same period of 1996. For the year ended December 31, 1997, contract research revenues were $16.2
million compared to $6.9 million last year. The increase in 1997 is due primarily to the expansion of the Company's existing
collaborative programs as well as the signing of additional collaborative agreements during the year.
For the three months ended December 31, 1997, the Company reported a net loss of $3.0 million or $0.20 per share,
compared to a net loss of $3.3 million or $0.28 per share in 1996. For the year ended December 31, 1997, the Company
reported a net loss of $10.0 million or $0.72 per share, compared to a net loss of $9.9 million or $0.88 per share, in 1996.
The net loss decreased in the three-month period ended December 31, 1997 compared to the corresponding period in 1996
due primarily to increased interest income earned on the Company's higher cash and investment balances. For the year ended
December 31, 1997 the net loss slightly increased compared to the similar period in 1996. This increase in net loss is primarily
a result of the overall expansion of the Company's operating activities, net of increases in interest income.
Twelve-month Summary
During 1997 and early 1998, the Company completed three new partnering agreements to develop products using its
pulmonary delivery system, entered its fifth and sixth drugs into human clinical trials, completed two other clinical trials, was
issued two United States patents, and strengthened its financial position by adding $70.7 million of new equity financing.
Inhale broadened its collaboration base by signing two collaborative product development agreements with Eli Lilly &
Company (Lilly) and one with Centeon, a joint venture of Hoechst AG [NYSE:HOE - news] and Rhone-Poulenc Rorer Inc.
The two Lilly agreements are for an osteoporosis drug and for an undisclosed protein. The Centeon agreement is to develop
pulmonary delivery for alpha-1 protease inhibitor for treating genetic emphysema.
During the year, the Company made clinical progress with several of its programs. Two drugs from Inhale's collaboration with
subsidiaries of Baxter International Inc. [NYSE:BAX - news] entered human clinical testing, one in a Phase II trial, the other in
Phase I. Two initial Phase I trials were completed in 1997 including salmon calcitonin as a potential treatment for osteoporosis,
Paget's disease, hypercalcemia, and other bone diseases and an undisclosed osteoporosis drug. Both trials indicated that the
drugs were absorbed systemically when delivered using Inhale's pulmonary delivery system. Inhale also continued its testing of
pulmonary-delivered insulin with Pfizer in Phase IIb testing with up to 240 patients.
Inhale advanced its intellectual property position with two new United States patents, one covering the pulmonary delivery of
active fragments of parathyroid hormone (PTH), a macromolecule drug being developed to treat osteoporosis; and the other
covering a system and methods for easier processing of fine dispersible powders.
The Company strengthened its balance sheet with two equity offerings. In February Inhale completed the sale of 1.8 million
newly-issued shares of Inhale common stock at the price of $18 per share to four institutional investors raising net proceeds of
$30.4 million. In early November, the Company finalized a public offering that totaled 1.725 million shares of common stock,
all of which were sold by the Company, at a price of $24.875 per share raising net proceeds of approximately $40.3 million.
The completion of the offerings described above as well as the payments received under the Company's collaborative
arrangements brings Inhale's total cash and investment balance to more than $100 million at December 31, 1997, placing the
Company in a strong position financially to move products to market.
Inhale, recently relocated to San Carlos, California, is developing a pulmonary delivery system to enable a wide range of drugs,
including macromolecules, to be delivered by the pulmonary route for systemic and local lung indications. The company
currently has six drugs in clinical trials using its delivery system and has feasibility and development partnerships with several
pharmaceutical, biotechnology, and medical technology companies, including Baxter, Pfizer, Lilly, and Centeon.
On October 27 Inhale and Baxter announced that they were entering discussions to re-negotiate certain terms of their current
collaborative agreement. This was initiated because of an increase in the estimated overall program scope and cost compared
with initial plans. There can be no assurance that the parties will be able to reach agreement or that the collaborative
arrangement with Baxter will be continued.
This release may contain forward-looking statements that reflect management's current views of future events and operations.
These forward-looking statements are based on assumptions, external factors, uncertainties and other risks that are detailed in
Inhale's SEC reports, including its Registration Statement on Form S-3 (No. 333-37195) and its Form 10-K for the year
ending December 31, 1996. Actual results could differ materially from these forward-looking statements.
INHALE THERAPEUTIC SYSTEMS
SELECTED FINANCIAL INFORMATION
(In thousands, except per share information)
Three Months Twelve Months
Ended Ended
December 31, December 31,
(unaudited)
1997 1996 1997 1996
Contract research revenue $ 4,790 $ 2,169 $ 16,249 $ 6,890
Operating costs and expenses:
Research and development 7,005 4,246 23,645 14,376
General and administrative 2,084 1,664 6,328 4,004
Total operating costs and
expenses 9,089 5,910 29,973 18,380
Loss from operations (4,299) (3,741) (13,724) (11,490)
Interest income, net 1,309 472 3,741 1,581
Net loss $ (2,990) $ (3,269) $ (9,983) $ (9,909)
Basic and diluted net
loss per common share $ (0.20) $ (0.28) $ (0.72) $ (0.88)
Shares used in computing
basic and diluted
net loss per common
share 14,922 11,752 13,792 11,207
Balance Sheet Data:
December 31, December 31,
1997 1996
Cash, cash equivalents
and short-term
investments $ 100,173 $ 36,309
Working capital 83,811 31,304
Total assets 119,762 41,492
Equipment financing obligations,
less current portion 5,102 187
Accumulated deficit (37,642) (27,691)
Total shareholders' equity 97,093 35,061 |
