CollaGenex Pharmaceuticals Reports Record Second Quarter 2002 Revenues, Up 26% to $11 Million; Loss Narrows to $0.07 per Share.Business Editors/Health & Medical Writers NEWTOWN, Pa.--(BUSINESS WIRE)--July 23, 2002 CollaGenex Pharmaceuticals, Inc. (Nasdaq:CGPI CGPI Corporate Goods Price Index (Japan) CGPI Capital Goods Price Index (New Zealand) ) today announced record total revenues of $11.0 million for the second quarter of 2002, a 26% increase over total revenues in the second quarter of 2001. Net product sales were a record $10.4 million, a 43% increase over net product sales in the second quarter of 2001. The net loss allocable to common stockholders continued to improve in the second quarter of 2002 and was $794,000, or $0.07 per basic and diluted share, compared to a net loss allocable to common stockholders in the second quarter of 2001 of $3.1 million, or $0.29 per basic and diluted share. "We are pleased with our financial performance during the second quarter, despite the continued weak economic environment and increased competitive pressures," said Brian M. Gallagher, PhD, chairman, president and chief executive officer of CollaGenex. "We remain focused on the execution of the fundamental elements of our strategy, which include growing our dental pharmaceutical franchise, building our commercial presence in dermatology dermatology (dûrmətŏl`əjē), branch of medicine concerned with diagnosis and treatment of diseases and disorders of the skin. and exploring additional applications of our IMPACS IMPACS Institute for Media, Policy and Civil Society IMPACS Integrated Manufacturing Planning and Control System IMPACS International Message and Packet Switching Service technology. We are executing our strategy to drive revenue and profitability in 2002 and beyond." "Our financial performance in the second quarter reflects significantly higher sales of Periostat, which increased 25% compared to the corresponding quarter last year, and the addition of the Atrix dental products, which together accounted for a 43% increase in net product sales compared to the second quarter of 2001," said Nancy C. Broadbent, chief financial officer of CollaGenex. "We achieved this significantly higher level of sales without increasing our total expenses, which were approximately $11.4 million in the second quarters of both 2002 and 2001. As a result, the increase in revenues went directly to our bottom line, and our operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. before preferred dividends preferred dividend n. a payment of a corporation's profits to holders of preferred shares of stock. (See: preferred stock) was less than $400,000. We expect this trend to continue as we build our revenue base, continue to manage expenses, and benefit from the operating leverage Operating Leverage A measurement of the degree to which a firm or project relies on fixed rather than variable costs. Notes: The higher the degree of operating leverage, the greater the potential danger from forecasting risk. of our business." "Turning to our balance sheet, at June 30, 2002, we had $5.6 million in cash," said Ms. Broadbent. "We also have a $4.0 million working capital line of credit and a $7.2 million equity credit line, which provide additional liquidity to execute our business plan." Dr. Gallagher concluded, "Despite more difficult market conditions, we had a successful second quarter, reflecting higher revenue, a reduced loss per share and continued progress in developing our pipeline. During the remainder of the year, we intend to drive growth in our dental business through intensified and focused promotional efforts highlighting the superior clinical advantages of our products to dental professionals. We will reduce our investment in direct-to-consumer advertising direct-to-consumer advertising Drug industry The use of mass media–eg, TV, magazines, newspapers, to publicly promote drugs, medical devices or other products which, by law, require a prescription, which targets consumers, with the intent of having a Pt during this period. With these efforts, we continue to be on track to achieve sustainable profitability next quarter." During the quarter, CollaGenex continued to make progress developing a presence in the dermatology market. The Company recently licensed Pandel, a prescription mid-potency topical steroid formulation to treat mild-to-moderate inflammatory disorders of the skin, such as atopic dermatitis Atopic Dermatitis Definition Eczema is a general term used to describe a variety of conditions that cause an itchy, inflamed skin rash. Atopic dermatitis, a form of eczema, is a non-contagious disorder characterized by chronically inflamed skin and and 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 . CollaGenex will market this product to the dermatology community through the strategic redeployment re·de·ploy tr.v. re·de·ployed, re·de·ploy·ing, re·de·ploys 1. To move (military forces) from one combat zone to another. 2. of its current sales force and, in the short term, through the use of a modestly sized dermatology contract sales force. With respect to the Restoraderm technology, several potential products have been formulated and are in stability testing Stability testing can refer to:
CollaGenex is currently in discussions with the FDA FDA abbr. Food and Drug Administration FDA, n.pr See Food and Drug Administration. FDA, n.pr the abbreviation for the Food and Drug Administration. to develop protocols for continuing the development of Periostat for the treatment of acne. The Company anticipates that a paper describing the results of a previously completed clinical trial supporting the efficacy of Periostat to treat acne will be published in a peer-reviewed journal peer-reviewed journal Refereed journal Academia A professional journal that only publishes articles subjected to a rigorous peer validity review process. Cf Throwaway journal. before the end of this year. Periostat is also currently being evaluated for the treatment of rosacea Rosacea Definition Rosacea is a skin disease typically appearing in people during their 30s and 40s. It is marked by redness (erythema) of the face, flushing of the skin, and the presence of hard pimples (papules) or pus-filled pimples (pustules), and in a double-blinded, placebo-controlled clinical trial. Rosacea is a very common inflammatory skin condition with limited therapeutic options. The Company also initiated a double-blinded, placebo-controlled clinical trial to evaluate the potential for Periostat to treat meibomianitis, an inflammatory condition affecting the eye that is characterized by painful, itchy itch·y adj. Having or causing an itching sensation. , dry eyes A condition in which the eyes feel dry or have a burning or stinging sensation due to an insufficient amount of tears. Dry eyes can be caused by the lack of blinking, which often occurs when users stare at a computer screen. . A number of patients who had been taking Periostat to treat adult periodontitis periodontitis Inflammation of soft tissues around the teeth (see tooth). Poor dental hygiene leads to deposition of bacterial plaque on the teeth below the gum line, irritating and eroding nearby tissues. subsequently reported improvements in their acne, rosacea or dry eye syndrome dry eye syndrome Conjunctivitis arida, keratitis sicca, keratoconjunctivitis sicca, xerophthalmia Medtalk Dryness of eyes, often due to ↓ tear secretion Clinical Dry, greasy, thickened and focally denuded cornea, which may progress to keratomalacia, corneal , which led to the Company's decision to formally evaluate Periostat in the treatment of these conditions. CollaGenex also continued to make progress internationally. During the second quarter, Periostat received final approval for marketing in the Netherlands, Portugal and Italy. Periostat will be marketed in Portugal by ISDIN S.A. The Company is actively seeking marketing and distribution partners for Italy and the Netherlands. CollaGenex Pharmaceuticals, Inc. is a specialty pharmaceutical company currently focused on providing innovative medical therapies to the dental and dermatology markets. Currently, the Company's 120-person professional dental pharmaceutical sales force markets Periostat(R), the first and only pharmaceutical to treat periodontal disease Periodontal Disease Definition Periodontal diseases are a group of diseases that affect the tissues that support and anchor the teeth. Left untreated, periodontal disease results in the destruction of the gums, alveolar bone (the part of the jaws where by inhibiting the enzymes that destroy periodontal periodontal /peri·odon·tal/ (per?e-o-don´t'l) 1. pertaining to the periodontal ligament or periodontium. 2. near or around a tooth. per·i·o·don·tal adj. 1. support tissues, Vioxx(R), a Merck & Co. drug that CollaGenex co-promotes for the treatment of acute dental pain, and Atridox(R), Atrisorb(R) and Atrisorb-D(R), Atrix Laboratories Inc.'s products for the treatment of adult periodontitis. Research has shown that the enzyme suppression technology underlying Periostat may also be applicable to other diseases involving inflammation and/or destruction of the body's connective connective - An operator used in logic to combine two logical formulas. See first order logic. tissues, including acne, rosacea, meibomianitis and cancer metastasis metastasis /me·tas·ta·sis/ (me-tas´tah-sis) pl. metas´tases 1. transfer of disease from one organ or part of the body to another not directly connected with it, due either to transfer of pathogenic microorganisms or to , among others. CollaGenex is further developing Periostat, as well as a series of novel, proprietary compounds known as IMPACS (Inhibitors of Multiple Proteases and Cytokines Cytokines Chemicals made by the cells that act on other cells to stimulate or inhibit their function. Cytokines that stimulate growth are called "growth factors. ), to address these applications. In addition CollaGenex has licensed the Restoraderm(TM) technology, a unique, proprietary dermal dermal /der·mal/ (der´mal) pertaining to the dermis or to the skin. der·mal or der·mic adj. Of or relating to the skin or dermis. drug delivery system, in order to develop a range of topical dermatological dermatological, dermatologic pertaining to dermatology; of or affecting the skin. products with enhanced pharmacologic and cosmetic properties. To receive additional information on the Company, please visit our Web site at www.collagenex.com, which is not a part of this press release. Periostat(R), Metastat(R), IMPACS(TM) and Restoraderm(TM) are United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. trademarks of CollaGenex Pharmaceuticals, Inc. Periostat(R) is a European Community European Community: see European Union. European Community (EC) Organization formed in 1967 with the merger of the European Economic Community, European Coal and Steel Community, and European Atomic Energy Community. trademark of CollaGenex Pharmaceuticals, Inc. Periostat(R), IMPACS(R) and Restoraderm(R) are United Kingdom trademarks of the Company's wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. , CollaGenex International Limited. CollaGenex(R) is a European Community and United Kingdom trademark of CollaGenex International Limited. Pandel(R) is a trademark of Taisho Pharmaceuticals. VIOXX(R)is a trademark of Merck & Co., Inc. Atridox(R), Atrisorb(R) and Atrisorb-D(R) are trademarks of Atrix Laboratories, Inc. Financial Tables Follow
Summary Financial Data
(Unaudited)
(In thousands, except share amounts)
Three Months Ended June 30,
----------------------------
2002 2001
---- ----
Statement of Operations Data
Revenues:
Product sales $ 10,377 $ 7,267
Contract revenues 555 1,024
License revenues 35 420
------------ ------------
10,967 8,711
Operating Expenses:
Cost of product sales 1,598 1,516
Research and development 870 874
Selling, general and administrative 8,899 9,070
------------ ------------
Total operating expenses 11,367 11,460
Other Income (expense):
Interest income 15 74
Interest expense (1) (2)
Other income (expense) 1 (4)
------------ ------------
Net loss (385) (2,681)
Preferred stock dividend 409 420
------------ ------------
Net loss allocable to common
stockholders $ (794) $ (3,101)
============ ============
Basic and diluted net loss per share
allocable to common stockholders
$ (0.07) $ (0.29)
============ ============
Shares used in computing basic and
diluted net loss per share allocable
to common stockholders
11,163,585 10,550,638
Six Months Ended June 30,
----------------------------
2002 2001
---- ----
Statement of Operations Data
Revenues:
Product sales $ 20,258 $ 13,381
Contract revenues 1,347 1,899
License revenues 122 456
------------ ------------
21,727 15,736
Operating Expenses:
Cost of product sales 3,178 2,882
Research and development 1,699 1,818
Selling, general and administrative 17,827 16,547
------------ ------------
Total operating expenses 22,704 21,247
Other Income (expense):
Interest income 37 136
Interest expense (2) (5)
Other income -- 8
------------ ------------
Net loss (942) (5,372)
------------
Preferred stock dividend 829 840
------------
Net loss allocable to common
stockholders $ (1,771) $ (6,212)
============ ============
Basic and diluted net loss per share
allocable to common stockholders
$ (0.16) $ (0.62)
============ ============
Shares used in computing basic and
diluted net loss per share allocable
to common stockholders
11,122,041 9,946,992
Selected Balance Sheet Data: June 30, 2002 December 31, 2001
--------------------------- ------------- -----------------
Cash, cash equivalents and
short-term investments $ 5,605 $ 6,171
Total current assets 13,354 13,251
Total assets 16,244 14,698
Total current liabilities 8,477 6,957
Long-term debt - -
Total liabilities 9,014 7,571
Total stockholders' equity 7,230 7,127
This press release contains forward-looking statements within the meaning of Section 21E of the Securities and Exchange Act of 1934, as amended. Investors are cautioned that forward-looking statements involve risks and uncertainties that may affect the company's business and prospects. The company's business of selling, marketing and developing pharmaceutical products is subject to a number of significant risks, including marketing plans; risks inherent in research and development activities; risks associated with conducting business in a highly regulated environment and uncertainty relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc clinical trials of products under development, all as discussed in the company's periodic filings with the U.S. Securities and Exchange Commission. |
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