BioTransplant Reports 2002 First Quarter Results.Business Editors CHARLESTOWN, Mass.--(BUSINESS WIRE)--May 13, 2002 BioTransplant Incorporated (Nasdaq: BTRN) today reported financial results for the quarter ended March 31, 2002. Revenues for the first quarter of 2002 increased to $477,000, compared to $0 in revenues reported for the same quarter in 2001. The increase in revenues was primarily due to $262,000 in product sales of the Eligix(TM) HDM HDM - SPECIAL Cell Separation Systems, which were launched in Europe during the fourth quarter of 2001 by the Company's distribution partner, Gambro BCT BCT Brigade Combat Team BCT Basic Combat Training BCT Best Conventional Pollutant Control Technology (EPA) BCT Business Cards Tomorrow BCT Banque Centrale de Tunisie (Central Bank of Tunisia) . In addition, $215,000 in license and milestone revenue was recognized in the first quarter from a total of $6.0 million in upfront license fees and milestone payments received in connection with the Company's exclusive distribution agreement with Gambro. The upfront fees and milestone payments under the Gambro distribution agreement are being recognized as revenue ratably over the life of the agreement. Research and development expenses for the three months ended March 30, 2002 increased to $4.2 million, from $2.0 million for the three months ended March 30, 2001. General and administrative expenses for the first quarter of 2002 increased to $1.2 million from $0.5 million for the same period a year ago. The increase in both research and development expenses and general and administrative expenses was primarily due to the inclusion of Eligix' operations, which are included in 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. beginning May 15, 2001, the date of the Company's acquisition of Eligix, Inc. For the quarter ended March 31, 2002, the Company reported a net loss of $6.6 million, or $0.31 per share, compared to a net loss of $2.3 million, or $0.20 per share, for the same period in 2001. The Company had cash, cash equivalents and short-term investments of $10.1 million as of March 31, 2002, as compared to $14.7 million as of December 31, 2001. The Company has recently announced a cost reduction program, which comprises a reduction in workforce and spending cuts impacting all segments of the Company. As a result of this program, the Company expects to have sufficient operating capital Noun 1. operating capital - capital available for the operations of a firm (e.g. manufacturing or transportation) as distinct from financial transactions and long-term improvements capital, working capital - assets available for use in the production of further assets to continue operations into 2003. "We continue to see encouraging clinical results from our portfolio of product candidates, and we are committed to advancing the development of these therapeutics," commented Elliot Lebowitz, Ph.D., Chief Executive Officer of BioTransplant. "Recent data suggests that the AlloMune System may help to reduce or eliminate the need for immunosuppressive therapy Immunosuppressive therapy Medical treatment in which the immune system is purposefully thwarted. Such treatment is necessary, for example, to prevent organ rejection in transplant cases. , and our collaborator, Massachusetts General Hospital Massachusetts General Hospital Health care The major teaching hospital for Harvard Medical School, widely regarded as one of the best health care centers in the world , has just initiated an additional trial evaluating this treatment regimen in kidney transplant kidney transplant or renal transplant Replacement of a diseased or damaged kidney with one from a living relative or a legally dead donor. The former's tissue type is more likely to match, reducing the chance of rejection; but removal puts the donor at risk, patients, in addition to ongoing trials in cancer patients. In our other clinical programs, we see increasing support for the use of our Eligix(TM) HDM Cell Separation System, and we expect further results from MedImmune's Phase II trials of our siplizumab monoclonal antibody monoclonal antibody, an antibody that is mass produced in the laboratory from a single clone and that recognizes only one antigen. Monoclonal antibodies are typically made by fusing a normally short-lived, antibody-producing B cell (see immunity) to a fast-growing product in psoriasis psoriasis (sôrī`əsĭs), occasionally acute but usually chronic and recurrent inflammation of the skin. The exact cause is unknown, but the disease appears to be an inherited, possibly autoimmune disorder that causes the patients in the third quarter this year." First Quarter Highlights - Immerge BioTherapeutics BioTransplant's joint venture with Novartis Pharma AG, Immerge BioTherapeutics, is focused on developing therapeutic applications for xenotransplantation. During the quarter, the companies reported progress on the joint venture's discovery efforts. - In the online edition of Science, researchers from the University of Missouri-Columbia and Immerge BioTherapeutics Inc. reported they have successfully cloned the world's first miniature swine with a specific gene that causes hyperacute rejection eliminated. - Immerge researchers announced the identification of miniature swine that failed to produce porcine endogenous retrovirus (PERV) in cultures of human cells. This study appeared in the March 2002 issue of the Journal of Virology. In March 2002, BioTransplant presented significant developments in the use of its proprietary Eligix(TM) Cell Separation Systems at the European Bone Marrow Transplant bone marrow transplant: see bone marrow. Annual Meeting. A number of presentations highlighted the potential of the device in reducing graft-versus-host disease graft-versus-host disease n. A type of incompatibility reaction of transplanted cells against host tissues that possess an antigen not possessed by the donor. Also called graft-versus-host reaction. (GVHD GVHD graft-versus-host-disease. GVHD Graft-versus-host disease, see there ) and purging tumor cells. - AlloMune System BioTransplant's AlloMune System, which will combine siplizumab with the Eligix(TM) Cell Separation System, is under development as a treatment regimen to more aggressively attack cancer or to induce patient's acceptance of a transplanted organ without long-term administration of immunosuppressive drugs immunosuppressive drug, any of a variety of substances used to prevent production of antibodies. They are commonly used to prevent rejection by a recipient's body of an organ transplanted from a donor. . Shortly after the close of the first quarter of 2002, BioTransplant announced the initiation of two clinical trials funded by the Immune Transplant Network (ITN ITN n abbr (Brit) (= Independent Television News) → chaîne de télévision commerciale ITN (Brit) n abbr (TV) (= Independent Television News) → ). One trial will evaluate the AlloMune System in patients with kidney failure kidney failure or renal failure Partial or complete loss of kidney function. Acute failure causes reduced urine output and blood chemical imbalance, including uremia. Most patients recover within six weeks. that have a blood cell cancer and one study will evaluate the AlloMune System in patients that do not have cancer. - Immerge BioTherapeutics BioTransplant's joint venture with Novartis Pharma AG, Immerge BioTherapeutics, is focused on developing therapeutic applications for xenotransplantation. During the quarter, the companies reported progress on the joint venture's discovery efforts. - In the online edition of Science, researchers from the University of Missouri-Columbia and Immerge BioTherapeutics Inc. reported they have successfully cloned the world's first miniature swine with a specific gene that causes hyperacute rejection eliminated. - Immerge researchers announced the identification of miniature swine that failed to produce porcine endogenous retrovirus (PERV) in cultures of human cells. This study appeared in the March 2002 issue of the Journal of Virology. About BioTransplant BioTransplant Incorporated, headquartered in Charlestown, Massachusetts Charlestown is a part of the city of Boston, Massachusetts located on a peninsula north of Boston proper. , is developing a portfolio of products for application in a range of medical conditions See carpal tunnel syndrome, computer vision syndrome, dry eyes and deep vein thrombosis. , including treatment of cancer and autoimmune diseases Autoimmune diseases A group of diseases, like rheumatoid arthritis and systemic lupus erythematosus, in which immune cells turn on the body, attacking various tissues and organs. Mentioned in: Complement Deficiencies, Premature Menopause , organ and tissue transplantation, for which current therapies are inadequate. Siplizumab (MEDI-507), a lead product we exclusively licensed to MedImmune, is in Phase II clinical trials 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 the treatment of psoriasis. In addition, the Company is developing the AlloMune System, which is designed to treat a variety of hematologic malignancies hematologic malignancy Hematologic cancer Hematology Any CA of blood-forming tissues, BM, or lymph nodes–eg, leukemia and lymphoma , and its distribution partner Gambro BCT markets the Eligix family of cell separation products in Europe for use in bone marrow, stem cell stem cell In living organisms, an undifferentiated cell that can produce other cells that eventually make up specialized tissues and organs. There are two major types of stem cells, embryonic and adult. and donor leukocyte leukocyte (l  `kəsīt'): see blood. leukocyte or white blood cell or white corpuscle transplants. Conference Call BioTransplant management will be holding a conference call at 10:00 a.m. Eastern Time today to discuss these results. Investors may access the call at the company's website at www.biotransplant.com. This call will not be archived or available for replay. This news 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. about BioTransplant that involve risks and uncertainties, including statements about our expectations with respect to our ability to fund operations into 2003. Such statements reflect management's current views and are based on certain assumptions. Actual results could differ materially from those currently anticipated as a result of a number of factors. Important factors that could cause future results to differ materially from such forward-looking statements include, but are not limited to: BioTransplant's ability to secure the additional funding required for its operations and research and development programs; BioTransplant's and its third party collaborators' ability to successfully discover, develop and commercialize its products, obtain and maintain required regulatory approvals in a timely fashion, and overcome other difficulties inherent in developing and commercializing therapeutics, therapeutic devices and therapeutic regimens; market acceptance and penetration of BioTransplant's Eligix(TM) HDM Cell Separation Systems in the European Union European Union (EU), name given since the ratification (Nov., 1993) of the Treaty of European Union, or Maastricht Treaty, to the European Community ; BioTransplant's ability to obtain and enforce the patent protection required for its products; and BioTransplant's ability to maintain collaborations and distribution arrangements with third parties. For a detailed discussion of these and other factors, see the section entitled "Business - Factors Which May Affect Results" in BioTransplant's current annual 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. , as filed with the Securities and Exchange Commission. Such forward-looking statements speak only as of the date of this news release. BioTransplant does not intend to update any of these forward-looking statements to reflect events or circumstances that occur after the date hereof.
BIOTRANSPLANT INCORPORATED AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Amounts)
(Unaudited)
Three Months Ended
March 31,
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2002 2001
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Revenues $ 477 $ --
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Expenses:
Cost of revenues 158 --
Research and development 4,199 1,985
General and administrative 1,171 482
Amortization of intangibles 393 --
Stock-based compensation 1,156 --
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Total operating expenses 7,077 2,467
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Interest income 34 170
Interest expense (52) (14)
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Net Loss ($ 6,618) ($ 2,311)
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Basic net loss
per common share ($ 0.31) ($ 0.20)
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Shares used in computing basic
net loss per common share 21,293 11,796
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SELECTED BALANCE SHEET INFORMATION
March 31, December 31,
2002 2001
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Cash, cash equivalents and investments $10,095 $14,657
Total assets 44,144 49,739
Stockholders' equity 33,573 38,879
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