Axys Pharmaceuticals Announces 1999 Third Quarter 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)--Nov. 2, 1999-- Axys Pharmaceuticals, Inc. (Nasdaq:AXPH) today announced consolidated financial results for the third quarter of 1999. The Company reported a net loss of $19.9 million, or $0.66 per share, including one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. charges of $8.1 million for the three months ended September September: see month. 30, 1999. The one-time charges include a restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. of $7.0 million related to the closing of the Company's San Diego San Diego (săn dēā`gō), city (1990 pop. 1,110,549), seat of San Diego co., S Calif., on San Diego Bay; inc. 1850. San Diego includes the unincorporated communities of La Jolla and Spring Valley. Coronado is across the bay. facility and a $1.1 million write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of assets in its inactive in·ac·tive adj. 1. Not active or tending to be active. 2. a. Not functioning or operating; out of use: inactive machinery. b. subsidiary Genos Biosciences. Excluding these one-time charges, the net loss was $11.8 million, or $0.39 per share, as compared to a net loss of $6.7 million, or $0.22 per share, for the same period in 1998. Total revenue for the 1999 third quarter was $9.0 million, compared to $14.3 million for the same period in 1998. The decrease was largely due to the previously announced termination of 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 milestones in certain gene finding and function collaborations primarily performed at the Company's San Diego facility. Consolidated 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 1999 third quarter were $21.2 million, excluding a $7.0 million one-time restructuring charge for the closing of the Company's San Diego operations. This compared to operating expenses of $20.6 million for the same period in 1998. The Company's affiliated businesses, which are independently funded by third parties, contributed $2.6 million to the consolidated operating expenses for 1999 third quarter. As of September 30, 1999, the Company's cash, marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has and receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed totaled $47.4 million. "Operating expenses for our core drug discovery and development efforts decreased in third quarter 1999 as compared to both third quarter 1998 and second quarter 1999, and will continue to decrease as the San Diego operations are being phased out," commented John Walker, Chairman 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. of Axys Pharmaceuticals. "We have implemented several initiatives in 1999 designed to produce a leaner, more focused organization. We have reduced headcount in the core business by approximately 170 positions since the beginning of the year and progressed in developing our proprietary oncology oncology /on·col·o·gy/ (ong-kol´ah-je) the sum of knowledge regarding tumors; the study of tumors. on·col·o·gy n. pipeline, including the recent in-license of an exciting program from Signal Pharmaceuticals, Inc. In addition, we continue to see significant value from our product-based drug discovery collaborations and our affiliated companies Affiliated Companies A situation that occurs when one company owns a minority interest (less than 50%) in another company. Also refers to companies that are related to each other in some way. Notes: An affiliated company is sometimes referred to as a subsidiary. ." Walker went on to say, "As we exit 1999 and look forward to 2000, we are focused on moving product candidates forward as rapidly as possible in both our proprietary and partnered programs." -0-
The Company also highlighted significant events during the third
quarter of 1999:
-- Axys acquired exclusive, worldwide development and marketing
rights to Signal Pharmaceuticals' selective estrogen
receptor-beta modulators (SERM-beta) for the treatment of cancer.
-- Axys Advanced Technologies, the Company's combinatorial chemistry
subsidiary, signed two new customers during third quarter 1999
and continues to provide positive cash flow to fund Axys' drug
discovery efforts, with in excess of $22 million of backlog at
September 30, 1999.
-- Akkadix Corporation completed its acquisition of Global Agro and
is now a minority owned ag-bio subsidiary of the Company.
-- Axys and Memorial Sloan-Kettering agreed to close Genos
Biosciences and will be jointly sharing the intellectual property
developed by Genos Biosciences.
-- In September, Kathleen Stafford, formerly of Amgen, Inc., CV
Therapeutics and Onyx Pharmaceuticals joined Axys as senior vice
president and chief financial officer
-0- Axys Pharmaceuticals is a drug discovery and development company with a proprietary focus in oncology. Axys is building shareholder value through (1) a broad and diversified diversified (di·verˑ·s pipeline of research and development programs partnered with world-class pharmaceutical companies; (2) expansion of a non-partnered research and development franchise in oncology; and (3) the spin out of affiliated businesses that leverage the company's technologies in order to provide capital for Axys' drug discovery and development programs. Axys' technology-leveraging businesses are: Axys Advanced Technologies, a combinatorial chemistry Combinatorial chemistry involves the rapid synthesis or the computer simulation of a large number of different but structurally related molecules. Introduction Synthesis of molecules in a combinatorial fashion can quickly lead to large numbers of molecules. oriented o·ri·ent n. 1. Orient The countries of Asia, especially of eastern Asia. 2. a. The luster characteristic of a pearl of high quality. b. A pearl having exceptional luster. 3. business; PPGx, a majority owned pharmacogenomics Pharmacogenomics is the branch of pharmacology which deals with the influence of genetic variation on drug response in patients by correlating gene expression or single-nucleotide polymorphisms with a drug's efficacy or toxicity. company, and Akkadix, an agricultural biotechnology company. Except for the historical information contained herein, this press release contains 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. that involve risks and uncertainties which could cause Axys' actual results to differ materially from those discussed here, including the reliance on the efforts of collaborative partners, the risk that this or other Axys collaborations will not be successful, the risk that clinical trials will not proceed as anticipated or may not be successful, the risks inherent in early stage development, the risk that Axys will not be successful in entering into new collaborations, competition and marketing risk, the risk of unexpected difficulties and delays in the development of new technologies and in expanding its manufacturing capabilities, and general economic conditions that may affect Axys' 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 en·ti·tle tr.v. en·ti·tled, en·ti·tling, en·ti·tles 1. To give a name or title to. 2. To furnish with a right or claim to something: "What Factors Could Cause Our Results to Differ Significantly from Those You Might Expect?" and "Additional Risk Factors" in the Axys' SEC Reports, including Axys' 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, 1998. For more information on Axys Pharmaceuticals, Inc., please visit the company's website at http://www.axyspharm.com. -0-
AXYS PHARMACEUTICALS, INC.
Consolidated Statements of Operations
(unaudited)
Three months Nine months
ended Sept. 30 ended Sept. 30
1999 1998(a) 1999 1998(a)
(in thousands, except per share amounts)
Revenues
Collaboration
and licensing
revenues $ 5,493 $ 9,761 $ 20,289 $ 26,411
Product and
service revenues 3,487 4,513 8,822 5,394
--------- --------- --------- ---------
Total revenues 8,980 14,274 29,111 31,805
Operating expenses:
Cost of products
sold 1,394 391 2,844 778
Research and
development 14,706 15,710 47,371 44,697
General and
administrative 5,076 4,480 12,829 11,602
Restructuring charge 7,008 -- 7,008 --
Acquired in process
research &
development -- -- -- 124,888
--------- --------- --------- ---------
Total operating
expenses 28,184 20,581 70,052 181,965
--------- --------- --------- ---------
Operating loss (19,204) (6,307) (40,941) (150,160)
Interest income
(expense), net (57) 410 606 1,972
Equity interest
in loss of
joint venture (6) (788) (836) (1,690)
Minority interest 612 -- 1,522 --
Other income/
expense, net (1,285) -- (1,253) --
--------- --------- --------- ---------
Net loss $ (19,940) $ (6,685) $ (40,902) $(149,878)
--------- --------- --------- ---------
Basic and diluted
net loss per share $ (0.66) $ (0.22) $ (1.35) $ (5.06)
--------- --------- --------- ---------
Shares used in
computing basic
and diluted net
loss per share 30,414 30,095 30,364 29,625
--------- --------- --------- ---------
Consolidated Balance Sheet Data
(in thousands)
September 30, December 31,
1999 1998
(unaudited)
Cash & marketable investments $ 43,217 $ 72,717
Accounts receivable 4,170 2,140
Total assets 73,767 107,262
Accumulated deficit (270,797) (229,895)
Total stockholders' equity 20,381 60,512
(a) Cost of products sold have been reclassified to conform to the
1999 presentation.
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