Ligand Reports Results for First Quarter 1998; Clinical and Preclinical Research Continue to Show Efficacy Of Lead Products
PR Newswire - May 15, 1998 09:23
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SAN DIEGO, May 15 /PRNewswire/ -- Ligand Pharmaceuticals Incorporated (Nasdaq: LGND) today reported revenues of $5.1 million in the first quarter ended March 31, 1998, compared with $9.8 million in first quarter 1997. The decreased revenues are primarily due to the November 1997 buyback of Allergan Ligand Retinoid Therapeutics (ALRT), as research expenditures incurred related to ALRT programs are no longer funded by ALRT, eliminating contract revenue recognition. This decrease in revenues was partially offset by increased revenues from a new research and development collaboration with Eli Lilly and Company ("Lilly") which began in November 1997. Revenues were in line with management expectations for the quarter.
Research and development expenses were $14.9 million in the first quarter ended March 31, 1998, compared with $16.6 million for the same period in 1997, a decrease of $1.7 million. Decreased research and development expenses are primarily due to completion of the research portion of the Sankyo collaboration in October 1997, offset by expansion of the Company's clinical and development personnel.
Selling, general and administrative expenses were $2.8 million in the first quarter ended March 31, 1998, compared to $2.3 million in the first quarter 1997. The increase reflects personnel additions and resource expansion in preparation for commercialization activities.
Net loss was $13.5 million in the first quarter of 1998 compared to $10.1 million in the first quarter 1997, an increase of $3.4 million. On a per share basis, net loss for first quarter 1998 was $0.35 per share compared with a net loss of $0.32 per share for the same period in 1997.
In April 1998, upon receipt of regulatory clearance, SmithKline Beecham plc. and Ligand initiated a new collaboration in leptin-obesity research. The goal of this new program is to develop small molecule drugs that modulate the signaling pathway controlled by leptin as a means of discovering orally available drugs for treatment or prevention of obesity. This obesity agreement follows the expansion and extension last year of Ligand's collaboration with SmithKline Beecham Corporation to discover and characterize small molecule drugs to control hematopoesis. As part of the new collaboration, SmithKline Beecham plc. made an upfront equity investment of $5.0 million (274,423 shares at $18.22 per share, a 20 percent premium) in Ligand common stock and also purchased for $1.0 million a warrant to purchase 150,000 shares of Ligand common stock at $20 per share.
As of March 31, 1998 Ligand had cash, cash equivalents, short-term investments and restricted cash of $64.6 million, a decrease of $22.2 million from year-end 1997. Had the new SmithKline Beecham, plc. agreement, warrant and equity purchase closed as of March 31, 1998, Ligand's cash, short-term investments and restricted cash would have been $70.6 million.
"Ligand continues to be well positioned to execute our commercialization strategy this year to achieve profitability in the 1999 timeframe," according to Paul V. Maier, Ligand Senior Vice President and Chief Financial Officer.
During the first quarter of 1998, Ligand made important progress in all of its leading drug candidates. Ligand reported positive final results of pivotal international Phase III trials for Panretin(TM) Gel and plans to file a New Drug Application (NDA) by the end of May are on schedule. Panretin(TM) Capsules also demonstrated positive results in two Phase II trials for Kaposi's sarcoma.
In February 1998, Ligand also announced that Targretin(TM) caused complete regression in 72 percent of established breast cancer tumors in one of the most commonly used rat models of this disease, according to a study published by scientists from Ligand in February's issue of Cancer Research.
Previous research demonstrated that Targretin is equally as effective as tamoxifen at preventing the emergence of breast cancer tumors in this animal model, which was designed to test prevention. This study compared the treatment potential of Targretin and tamoxifen both individually and in combination therapy. The use of tamoxifen alone resulted in complete regression in 33.3 percent of tumors, compared to Targretin's rate of regression in 72 percent of tumors.
In March 1998, American Home Products announced they submitted an Investigational New Drug (IND) application for the compound TSE424, an estrogen receptor partial agonist for osteoporosis developed in its collaboration with Ligand.
This press release may contain certain forward looking statements by Ligand and actual results could differ materially from those described as a result of factors, including, but not limited to, the following. There can be no assurance: (a) that projected revenues will be available in a timely manner; (b) that if a need for additional financing occurs, such financing will be available to the Company when required or that such financing would be available under favorable terms; (c) that any product will be successfully developed, that regulatory approvals will be granted, that patient and physician acceptance of these products will be achieved or that final results of human clinical trials will be consistent with any interim results, or that results will be supportive of regulatory approvals required to market products; (d) that changes in the existing collaborative research relationships will not occur, including their early termination; or (e) that regulatory approvals when required for a transaction will be obtained. Ligand undertakes no obligation to update the statements contained in this press release after the date hereof. Note: If you would prefer to receive Ligand's press releases via e-mail please inform us at investors@ligand.com and request to be placed on our priority e-mail list.
LIGAND PHARMACEUTICALS INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS INFORMATION
(Dollars in Thousands, Except Per Share Data)
(Unaudited)
Three Months Ended
March 31,
1998 1997
Revenues:
Collaborative research and development$4,974 $9,703
Other 92 109
Total revenue 5,066 9,812
Costs and expenses:
Research and development 14,907 16,626
Selling, general and administrative 2,769 2,319
Total operating expenses 17,676 18,945
Loss from operations (12,610) (9,133)
Interest income/(expense) - net (931) (1,006)
Net loss $(13,541) $(10,139)
Basic and diluted loss per share $(.35) $(.32)
Shares used in computing net loss
per share 38,565 31,994
CONSOLIDATED BALANCE SHEETS INFORMATION
(Dollars in Thousands)
March 31, December 31,
1998 1997
Assets (Unaudited)
Current assets:
Cash, cash equivalents and
short term investments $61,782 $ 83,230
Other current assets 2,042 864
Total current assets 63,824 84,094
Restricted short-term investments 2,809 3,057
Property and equipment, net 15,460 14,853
Other assets 7,360 5,419
$89,453 $107,423
Liabilities and Stockholders' Equity
Current liabilities $14,524 $ 21,695
Long-term debt 14,824 14,751
Convertible subordinated debentures 37,296 36,628
Stockholders' equity 22,809 34,349
$89,453 $107,423
SOURCE Ligand Pharmaceuticals Incorporated
/CONTACT: Paul V. Maier, Senior Vice President and Chief Financial
Officer of Ligand, 619-550-7500/
/Company News On-Call: prnewswire.com or fax, 800-758-5804,
ext. 509313/
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