AXYS Pharmaceuticals Announces Fourth Quarter and Year-End 1997 Financial Results.SOUTH SAN FRANCISCO South San Francisco, city (1990 pop. 54,312), San Mateo co., W Calif.; inc. 1908. South San Francisco has several industrial parks; its manufactures include medical supplies and equipment, foods, paint, paper products, consumer goods, and clothing. , Calif.--(BW HealthWire)--Feb. 26, 1998-- AXYS Pharmaceuticals, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :AXPH) today announced financial results for the fourth quarter and year-end December 31, 1997. These financial results represent only Arris ar·ris n. pl. arris or ar·ris·es The sharp edge or ridge formed by two surfaces meeting at an angle, as in a molding. [Alteration of Old French areste, fishbone, spine Pharmaceutical and do not include the impact of the acquisition of Sequana Therapeutics Inc. (Sequana) and the subsequent formation of AXYS Pharmaceuticals in January 1998. Contract revenues for the fourth quarter grew 19.3% to $6.4 million from $5.4 million in the final quarter of 1996. Operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. for the 1997 fourth quarter were $10.2 million compared to $7.7 million for the same period in the prior year. The increased operating expenses for the fourth quarter were primarily in research and development, which grew to $8.2 million from $6.2 million in the same quarter last year. General and administrative expenses grew to $2.0 million in the recent fourth quarter, from $1.5 million in the fourth quarter last year, reflecting increased costs associated with research and development support. The net loss for the fourth quarter of 1997 was $3.2 million, or $0.21 per share, versus a net loss of $1.6 million, or $0.11 per share, for the fourth quarter of 1996. For the year ended December 31, 1997, contract revenues were $24.8 million, a 15.1% increase over the $21.6 million reported at year-end 1996. Operating expenses for 1997 totaled $38.2 million, compared to $30.0 million last year. Of these, research and development expenses accounted for $31.1 million, versus $24.3 million in 1996. These increases primarily reflect higher expenditures associated with two Phase IIa clinical trials of APC-366 and investments in proprietary research programs. For the full-year 1997, the company reported a net loss of $11.0 million, or $0.73 per share, compared to a net loss of $5.9 million, or $0.45 per share, in 1996. The Company's cash and investments were $53.4 million as of December 31, 1997. Giving effect to the acquisition of Sequana, on a pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma combined basis, had the acquisition been in place for the entire calendar year, revenue would have been $44.4 million, an increase of 41.9% over pro forma combined 1996 revenue of $31.3 million. Cash and marketable investments on a pro forma combined basis at December 31, 1997 would have been $101.5 million. John Walker, chairman and chief executive officer of AXYS, stated, "1997 was a significant year in our drive to establish the company as the leading drug discovery company in the biotechnology industry. Our revenue increase, as reflected on a pro forma combined basis, shows the support of many of the world's best pharmaceutical companies for our research capabilities. In addition to the achievements of our collaborative research, AXYS made significant progress in business development, in the clinic and in proprietary research." ...Combined 1997 Highlights Business Development -- Formed collaboration agreement with Bristol-Myers Squibb Bristol-Myers Squibb (NYSE: BMY), colloquially referred to as BMS, is a pharmaceutical corporation, formed by a 1989 merger between pharmaceutical companies Bristol-Myers Company, founded in 1887 by William McLaren Bristol and John Ripley Myers in Clinton, NY (both were to develop protease inhibitors Protease Inhibitors Definition A protease inhibitor is a type of drug that cripples the enzyme protease. An enzyme is a substance that triggers chemical reactions in the body. for the hepatitis C virus
abbr. hepatitis C virus HCV 1 Hepatitis C virus, see there 2. Human coronavirus. See Coronavirus. ). -- Formed Parke-Davis collaboration targeting schizophrenia and bipolar disorder bipolar disorder, formerly manic-depressive disorder or manic-depression, severe mental disorder involving manic episodes that are usually accompanied by episodes of depression. . This collaboration, which includes gene identification and bioinformatics, had an announced deal value of $103 million, which includes up-front licensing fees, research funding Research funding is a term generally covering any funding for scientific research, in the areas of both "hard" science and technology and social science. The term often connotes funding obtained through a competitive process, in which potential research projects are evaluated and and milestone payments. -- Formed GlaxoWellcome collaboration in functional screening. -- Formed Genos Biosciences joint venture with Memorial Sloan-Kettering Cancer Center The Memorial Sloan-Kettering Cancer Center (MSKCC) in New York City is a cancer treatment and research institution founded in 1884 as the New York Cancer Hospital. The main campus is located at 1275 York Avenue, between 67th and 68th Streets, with other locations in New in the area of cancer genetics. -- Formed Genecore joint venture with Perkin-Elmer Applied Biosystems. The focus of the joint venture is large scale DNA DNA: see nucleic acid. DNA or deoxyribonucleic acid One of two types of nucleic acid (the other is RNA); a complex organic compound found in all living cells and many viruses. It is the chemical substance of genes. , genomic sequencing and is located in Shanghai, China. Genecore has been awarded a research contract from China's State Science & Technology Commission to sequence human genes involved in liver cancer Liver Cancer Definition Liver cancer is a relatively rare form of cancer but has a high mortality rate. Liver cancers can be classified into two types. . -- Formed collaboration to transfer specialized screening technologies to Abbott Laboratories for use in an undisclosed proprietary research program. -- Amended collaboration agreement with Bayer AG to allow AXYS to reacquire the rights to exploit tryptase inhibitors against two indications: inflammatory bowel disease inflammatory bowel disease n. Abbr. IBD Any of several incurable and debilitating diseases of the gastrointestinal tract characterized by inflammation and obstruction of parts of the intestine. and psoriasis. Clinical Program -- Completed two Phase IIa studies in asthma (APC-366). Statistical significance in preventing the late airway response in an allergen allergen /al·ler·gen/ (al´er-jen) an antigenic substance capable of producing immediate hypersensitivity (allergy).allergen´ic pollen allergen induced challenge was demonstrated in the first of these, while a positive trend in reversing bronchial hyperresponsiveness bronchial hyperresponsiveness Exaggerated bronchial constriction most common in asthma, in response to nonspecific provocation, inhalation of various bronchoconstrictors, but also to physical challenges–eg, exercise, dry or cold air, hypertonic or hypotonic aerosols was demonstrated in the second. -- Selected APC-2059 as a clinical candidate for studies in psoriasis and inflammatory bowel disease. Research -- Received a patent providing broad coverage on the company's method of protease protease /pro·te·ase/ (pro´te-as) endopeptidase. pro·te·ase n. Any of various enzymes, including the proteinases and peptidases, that catalyze the hydrolytic breakdown of proteins. inhibition known as the "Delta Technology". -- Identified a gene responsible for asthma. -- Published structures for Cathepsin K in NATURE STRUCTURAL BIOLOGY and chymase in BIOCHEMISTRY. -- Solved structures for Cathepsin S cathepsin /ca·thep·sin/ (kah-thep´sin) one of a number of enzymes each of which catalyzes the hydrolytic cleavage of specific peptide bonds. , tissue kallikrein and a cytokine receptor complex. -- Synthesized from 10mg to 30mg of more than 150,000 individual combinatorial chemistry compounds. -- Using Delta technology, AXYS developed orally available and efficacious inhibitors of both tryptase and factor Xa targets in our collaborations with Bayer AG and Pharmacia & Upjohn respectively. Walker continued, "During the first two months of 1998, we continued to announce accomplishments including the closing of the Sequana acquisition; the creation of our Advanced Technologies Division to commercialize our capabilities in combinatorial chemistry, pharmacogenomics and our patented Delta Technology; the issuance of patents on two proprietary genes known as TULP tulp [Af.] a form of poisoning caused by moraea and homeria spp. plants. 1 and TULP2; and the publication of our Delta Technology in NATURE and our TULP1 paper in NATURE GENETICS. "Moving forward in 1998 and beyond, our primary goal is to capture the full value of both our technology developments and drug discoveries. Consistent with that, we seek to form new and broader collaborations in therapeutic areas such as inflammation, metabolic disorders and oncology, and to establish positions in new markets that will help monetize the Sequana acquisition. Additionally, we look to advance our clinical programs and to reduce our burn rate from its current level," Walker concluded. AXYS Pharmaceuticals is a leader in the integration of drug discovery technologies from gene identification through clinical development and is focused on the discovery of small molecule therapeutics. The company has research collaborations with world-class pharmaceutical companies, covering a broad range of therapeutic areas, including respiratory, cardiovascular, metabolic, and infectious disease Infectious disease A pathological condition spread among biological species. Infectious diseases, although varied in their effects, are always associated with viruses, bacteria, fungi, protozoa, multicellular parasites and aberrant proteins known as prions. , as well as oncology and central nervous system disorders Nervous system disorders A satisfactory classification of diseases of the nervous system should include not only the type of reaction (congenital malformation, infection, trauma, neoplasm, vascular diseases, and degenerative, metabolic, toxic, or deficiency . Except for the historical information contained herein, this press release contains forward-looking statements that involve risks and uncertainties that could cause the Company's actual results to differ materially from those discussed here, including the risk that issued patents may not provide adequate protection, the Company's early stage of development, the risk of the Company's reliance on the efforts of its collaborative partners, competition, and general economic conditions that may affect the Company's actual results and developments. Additional factors that could cause or contribute to such differences include, but are not limited to, those discussed in the sections entitled "Business Risks" in the Company's SEC Reports, including the report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the fiscal year ended December 31, 1996 and the Company's Report on Form 10-Q Form 10-Q See 10-Q. for the quarter ended September 30, 1997, as well as those discussed in the section entitled "Risk Factors" in the Company's Registration Statement on Form S-4 filed with the SEC on November 26, 1997. -0-
AXYS PHARMACEUTICALS, INC.
These financial results represent only Arris Pharmaceutical
and do not include the impact of the acquisition of
Sequana Therapeutics Inc.
Consolidated Statements of Operations
Three months ended Year ended
December 31, December 31,
1997 1996 1997 1996
------------------ -----------------
(unaudited)
(in thousands, except per share amounts)
Contract revenues $ 6,401 $ 5,365 $ 24,814 $ 21,560
Operating expenses:
Research and development 8,209 6,193 31,050 24,319
General and administrative 2,021 1,530 7,153 5,409
Acquired in-process
research and development -- -- -- 230
-------- -------- -------- --------
Total operating expenses 10,230 7,723 38,203 29,958
-------- -------- -------- --------
Operating loss (3,829) (2,358) (13,389) (8,398)
Interest income, net 616 758 2,422 2,470
-------- -------- -------- --------
Net loss $ (3,213) $ (1,600) $(10,967) $ (5,928)
======== ======== ======== ========
Net loss per share $ (0.21) $ (0.11) $ (0.73) $ (0.45)
======== ======== ======== ========
Shares used in computing
net loss per share 15,167 14,297 15,025 13,177
Consolidated Balance Sheet Data
December 31, December 31,
1997 1996
-----------------------------
(in thousands)
Cash, cash equivalents and marketable
investments $ 53,408 $ 66,720
Total assets 73,584 80,832
Accumulated deficit (73,771) (62,804)
Total stockholders' equity 43,890 52,900
CONTACT: AXYS Pharmaceuticals, Inc. John Walker, Chairman/CEO or Shari Annes (IR), 650/829-1000 Internet: http://www.axyspharm.com |
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