Altus Pharmaceuticals Reports 2005 Year-End Financial Results.CAMBRIDGE, Mass. -- Altus Pharmaceuticals Inc. (Nasdaq: ALTU), a biopharmaceutical company developing and commercializing oral and injectable in·ject·a·ble adj. Capable of being injected. Used of a drug. n. A drug or medicine that can be injected. protein therapeutics therapeutics Treatment and care to combat disease or alleviate pain or injury. Its tools include drugs, surgery, radiation therapy, mechanical devices, diet, and psychiatry. for patients with gastrointestinal and metabolic disorders Noun 1. metabolic disorder - a disorder or defect of metabolism disorder, upset - a physical condition in which there is a disturbance of normal functioning; "the doctor prescribed some medicine for the disorder"; "everyone gets stomach upsets from time to time" , today reported financial results for the quarter and year ended December 31, 2005. The Company reported a net loss attributable to common stockholders of $38.0 million for the full year ended December 31, 2005, compared to a net loss attributable to common stockholders of $29.5 million for the full year ended December 31, 2004. For the fourth quarter of 2005, the Company reported a net loss attributable to common stockholders of $10.8 million, compared to a net loss attributable to common stockholders of $10.3 million for the same period in 2004. Cash and cash equivalents and short-term investment balances at December 31, 2005 were $30.0 million. Subsequent to December 31, 2005, the Company raised net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). of approximately $110 million in an initial public offering of its common stock that closed on January 31, 2006. "Altus is focused on developing improved and differentiated products for patients with gastrointestinal and metabolic disorders," stated Sheldon Berkle, President and Chief Executive Officer of Altus. "With a very successful IPO (Initial Public Offering) The first time a company offers shares of stock to the public. While not a computer term per se, many founders, employees and insiders of computer companies have found this acronym more exciting than any tech term they ever heard. behind us and the resources to further advance the development of our products, we look forward to initiating Phase III Noun 1. phase III - a large clinical trial of a treatment or drug that in phase I and phase II has been shown to be efficacious with tolerable side effects; after successful conclusion of these clinical trials it will receive formal approval from the FDA , pivotal trials this year on our two lead programs to treat pancreatic insufficiency pancreatic insufficiency A relative or absolute lack of pancreatic enzymes, a finding typical of cystic fibrosis. See Cystic fibrosis. and growth hormone growth hormone or somatotropin (sōmăt'ətrō`pən), glycoprotein hormone released by the anterior pituitary gland that is necessary for normal skeletal growth in humans (see protein). disorders." 2005 Accomplishments include: --Reported positive results from the Company's Phase II study of ALTU-135, an orally-administered enzyme replacement therapy Enzyme replacement therapy is a medical treatment replacing an enzyme in patients in whom that particular enzyme is deficient or absent. Usually this is done by giving the patient an intravenous (IV) infusion containing the enzyme. for the treatment of patients with pancreatic insufficiency. ALTU-135 was well tolerated by patients and the trial achieved its primary efficacy endpoint, a statistically significant improvement in fat absorption. --Advanced the development of ALTU-238, a crystallized crys·tal·lize also crys·tal·ize v. crys·tal·lized also crys·tal·ized, crys·tal·liz·ing also crys·tal·iz·ing, crys·tal·liz·es also crys·tal·iz·es v.tr. 1. formulation of human growth hormone human growth hormone (HGH): see growth hormone. that is designed to be administered once weekly, by filing an IND and subsequently reporting positive results of a Phase I trial and initiating a multi-center Phase II trial in adults with growth hormone deficiency growth hormone deficiency Hypopituitarism Endocrinology A condition which affects 1:4000 children; ♂:♀, 3-4:1 Etiology 70% of GHD is idiopathic and attributed to a prenatal insult, possibly due to hypothalamic dysfunction, given that GHD children . --Achieved pre-clinical proof-of-concept for ALTU-237, an orally-administered crystalline Like a crystal. It implies a uniform structure of molecules in all dimensions. For example, phase change technology, widely used for rewritable optical discs, uses crystalline spots (bits) to reflect the laser beam. Amorphous, non-crystalline bits do not reflect light. formulation of an oxalate-degrading enzyme which is designed for the treatment of primary hyperoxaluria primary hyperoxaluria Oxalosis An AR condition characterized by crystallization in tissues Clinical Calcium oxalate–CO is ↑↑↑ in urine, resulting in CO supersaturation crystalluria, stone formation, and deposition of CO in the renal parenchyma, and enteric enteric /en·ter·ic/ (en-ter´ik) within or pertaining to the small intestine. en·ter·ic adj. 1. Of, relating to, or within the intestine. 2. hyperoxaluria, as well as to prevent the recurrence recurrence /re·cur·rence/ (-ker´ens) the return of symptoms after a remission.recur´rent re·cur·rence n. 1. of kidney stones Kidney Stones Definition Kidney stones are solid accumulations of material that form in the tubal system of the kidney. Kidney stones cause problems when they block the flow of urine through or out of the kidney. in individuals with a risk or history of recurrent kidney stones. --Strengthened the Company's senior management team with the additions of Sheldon Berkle as President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. ; Alan Kimura, MD, PhD as Vice President, Clinical Development and Medical Affairs; and Gerhard Klement as Vice President, Manufacturing and Technical Operations. Full Year Results The Company reported a net loss attributable to common stockholders of $38.0 million or $22.13 per share for the full year ended December 31, 2005, compared to a net loss attributable to common stockholders of $29.5 million or $17.33 per share for the full year ended December 31, 2004. Total revenues were $8.3 million for 2005 compared to $4.2 million in 2004. Revenues consist primarily of amounts earned under collaborative research and development agreements relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc ALTU-135. Research and development expenses totaled $26.7 million for 2005 compared to $19.1 million in 2004. The increase in 2005 R&D expenses was primarily attributable to an increase in development costs relating to ALTU-135 and ALTU-238. During 2005, the Company completed a Phase II clinical trial Noun 1. phase II clinical trial - a clinical trial on more persons than in phase I; intended to evaluate the efficacy of a treatment for the condition it is intended to treat; possible side effects are monitored phase II for ALTU-135 and for ALTU-238, filed an IND, completed a Phase I clinical trial Noun 1. phase I clinical trial - a clinical trial on a few persons to determine the safety of a new drug or invasive medical device; for drugs, dosage or toxicity limits should be obtained phase I and initiated a Phase II clinical trial. General and administrative expenses were $8.6 million for 2005 compared to $6.3 million in 2005. The increase in 2005 G&A expenses was primarily attributable to an increase in recruiting, consulting, and marketing fees, as well as increased salaries and professional fees related to the Company's accounting, human resource and information technology functions. The Company also had increased non-cash compensation expense related to the issuance of employee stock options. The Company expects G&A expenses to increase considerably in the future due to increased payroll, expanded infrastructure, and increased consulting, legal, accounting and investor relations Investor relations The process by which the corporation communicates with its investors. expenses associated with the operations of a public company. Fourth Quarter Results For the fourth quarter of 2005, the Company reported a net loss attributable to common stockholders of $10.8 million or $5.88 per share, compared to a net loss attributable to common stockholders of $10.3 million or $5.98 per share in the fourth quarter of 2004. Total revenues were $1.6 million in the fourth quarter of 2005 compared to $1.2 million in the fourth quarter of 2004. Revenues consisted primarily of amounts earned under collaborative research and development agreements relating to ALTU-135. Research and development expenses totaled $7.0 million in the fourth quarter of 2005 compared to $7.1 million in the fourth quarter of 2004. Fourth quarter 2005 R&D expenses were primarily related to planning activities with respect to a Phase III clinical trial Noun 1. phase III clinical trial - a large clinical trial of a treatment or drug that in phase I and phase II has been shown to be efficacious with tolerable side effects; after successful conclusion of these clinical trials it will receive formal approval from the for ALTU-135 and an ongoing Phase II clinical trial for ALTU-238. Fourth quarter 2004 R&D expenses were primarily related to the Phase II clinical trial for ALTU-135 in process during the entire quarter and preparing ALTU-238 for an IND. General and administrative expenses were $2.6 million in the fourth quarter of 2005 compared to $1.7 million in the fourth quarter of 2004. The increase in 2005 G&A expenses was primarily attributable to an increase in salaries and professional fees related to the Company's accounting, human resource and information technology functions. The Company also had increased non-cash compensation expense related to the issuance of employee stock options. 2006 Financial Guidance Based on current operating plans, expected timing and cost of clinical trials and other product development programs, Altus expects its net cash used in operating activities to be between $55 million and $65 million in 2006. About Altus Pharmaceuticals Altus Pharmaceuticals is a company focused on the development and commercialization of oral and injectable protein therapeutics for patients with gastrointestinal and metabolic disorders. The Company's website is http://www.altus.com. Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Statement Certain statements in this news release concerning Altus' business are considered "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. These statements include, but are not limited to: the timing and progress of initiation of pivotal clinical trials of the Company's lead product candidates, and the anticipated use of cash by the Company in 2006. Any or all of the forward-looking statements in this press release may turn out to be wrong. They can be affected by inaccurate assumptions Altus might make or by known or unknown risks and uncertainties, including, but not limited to uncertainties as to the future success of ongoing and planned clinical trials; and the unproven unproven Dubious, nonscientific, not proven, quack, questionable, unscientific adjective Relating to that which has not been validated by reproducible experiments or other scientific methods for determining effect or efficacy safety and efficacy of products under development. Consequently, no forward-looking statement can be guaranteed, and actual results may vary materially. Additional information concerning factors that could cause actual results to materially differ from those in the forward-looking statements is contained in Altus' reports to the Securities and Exchange Commission. However, Altus undertakes no obligation to publicly update forward-looking statements, whether because of new information, future events or otherwise.
ALTUS PHARMACEUTICALS INC. (ALTU)
Consolidated Statements of Operations
(Unaudited, in thousands, except per share amounts)
Three Months Ended Year Ended
December 31, December 31,
-------------------- -------------------
2005 2004 2005 2004
---------- --------- --------- ---------
Total revenue 1,561 1,154 8,288 4,230
---------- --------- --------- ---------
Costs and expenses:
Cost of product sales - - - 87
Research and development 6,950 7,100 26,742 19,095
General, sales, and
administrative 2,608 1,697 8,611 6,320
---------- --------- --------- ---------
Total costs and expenses 9,558 8,797 35,353 25,502
---------- --------- --------- ---------
Loss from operations (7,997) (7,643) (27,065) (21,272)
---------- --------- --------- ---------
Other income (expense):
Interest income 317 241 1,018 646
Interest expense (208) (118) (825) (469)
Foreign currency (loss) gain (127) - (252) 138
---------- --------- --------- ---------
Total other income
(expense) --net (18) 123 (59) 315
---------- --------- --------- ---------
Net loss (8,015) (7,520) (27,124) (20,957)
Preferred stock dividends and
accretion (2,739) (2,743) (10,908) (8,588)
---------- --------- --------- ---------
Net loss attributable to
common stockholders (10,754) (10,263) (38,032) (29,545)
========== ========= ========= =========
Net loss attributable to
common stockholders per share
- basic and diluted $ (5.88) $ (5.98) $ (22.13) $ (17.33)
========== ========= ========= =========
Weighted average shares
outstanding - basic and
diluted 1,829 1,717 1,719 1,704
========== ========= ========= =========
Condensed Consolidated Balance Sheets
(Unaudited, in thousands, except per share amounts)
December 31, December 31,
2005 2004
------------ ------------
Cash and cash equivalents and short-term
investments $ 30,061 $ 52,638
Prepaid expenses and other current assets 2,406 954
Property and equipment, net 6,763 7,586
Other assets, net 1,354 1,646
------------ ------------
Total assets $ 40,584 $ 62,824
============ ============
Current liabilities 18,218 11,980
Noncurrent liabilities 7,940 10,491
Redeemable preferred stock 119,373 108,465
Total stockholders' (deficit) (104,947) (68,112)
------------ ------------
Total liabilities, redeemable preferred stock
and stockholders' deficit $ 40,584 $ 62,824
============ ============
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