Collagen Reports Fiscal Third-Quarter Financial Results; Company reports commencement of two clinical trials.PALO ALTO Palo Alto, city, California Palo Alto (păl`ō ăl`tō), city (1990 pop. 55,900), Santa Clara co., W Calif.; inc. 1894. Although primarily residential, Palo Alto has aerospace, electronics, and advanced research industries. , Calif.--(BW HealthWire)--April 28, 1997--Collagen Corporation (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 : CGEN CGEN Convective Sigmet Generation ) today reported results for the quarter ended March 31, 1997. Collagen collagen (kŏl`əjən), any of a group of proteins found in skin, ligaments, tendons, bone and cartilage, and other connective tissue. Cells called fibroblasts form the various fibers in connective tissue in the body. reported a net loss of $5.5 million, or $0.41 per share, including a non-recurring charge equal to $0.14 per share, net of tax, related to a senior officer's severance costs. The net loss was due primarily to no gains from the sale of shares in Target 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. , Inc. ("Target"), which had been recorded in previous quarters. Collagen Corporation was precluded from offsetting the current quarter losses with sales of its Target holdings by mutual agreement and applicable pooling restrictions with respect to the Target and Boston Scientific The Boston Scientific Corporation (NYSE: BSX) (abbreviated BSC), is a worldwide developer, manufacturer and marketer of medical devices whose products are used in a range of interventional medical specialties, including interventional cardiology, peripheral interventions, merger. Collagen's holdings in Target have now been converted into 1.36 million shares of Boston Scientific stock and pursuant to the merger agreement, Collagen is restricted from selling this stock until the expiration of applicable pooling restrictions, which is expected to occur late in the first quarter of fiscal 1998. As of April 24, Collagen's holdings in Boston Scientific were valued at approximately $58 million, or $6.60 per share of Collagen Corporation stock on a pre-tax basis. The Company reported revenues of $16.5 million for the fiscal third quarter, essentially level with the same period last year. Third quarter sales include an unfavorable foreign exchange rate impact of approximately $400,000 compared with the prior-year period, due to the strengthened U.S. dollar. Selling, general and administrative ("SG&A") expenses for the quarter increased nine percent over the prior-year period, due in part to the acceleration of expenses in preparation for trial in the Company's trade secrets lawsuit against Matrix Pharmaceuticals. As expected, SG&A expenses also increased slightly due to costs related to the exploration and evaluation of strategies for the Aesthetic Technologies(TM) Group, as described in Collagen's January 8, 1997 announcement of its plan to formally separate this group from Collagen Corporation and form a new company. Collagen is continuing to examine potential strategies to enhance stockholder value. Aesthetic Technologies(TM) Group The mission of the Aesthetic Technologies(TM) Group is to bring innovative solutions to market that have aesthetic and reconstructive benefits for patients. For the fiscal third quarter, the group's worldwide product sales from Zyderm(R) and Zyplast(R) collagen implants, Hylaform(R) viscoelastic Adj. 1. viscoelastic - having viscous as well as elastic properties natural philosophy, physics - the science of matter and energy and their interactions; "his favorite subject was physics" gel, the Trilucent(TM) breast implant breast implant, saline- or silicone-filled prosthesis used after mastectomy as a part of the breast reconstruction process or used cosmetically to augment small breasts. , and royalties from Contigen(R) Bard bard, in Wales, term originally used to refer to the order of minstrel-poets who composed and recited the poems that celebrated the feats of Celtic chieftains and warriors. collagen implant were $15.8 million in total, essentially level with the prior-year period. U.S. injectable in·ject·a·ble adj. Capable of being injected. Used of a drug. n. A drug or medicine that can be injected. unit sales unit sales Sales measured in terms of physical units rather than dollars. Unit sales data are often used by financial analysts when evaluating the health of a company. were up 14 percent for the quarter compared with the prior-year period. Fiscal third quarter Trilucent(TM) implant sales increased slightly over the prior-year period, while year-to-date sales are up over 50 percent compared with the prior-year period. International injectable product sales during the quarter were adversely affected, in part, by the sale of competitive injectable products in Japan, the focus of the European sales force on the launches of Hylaform(R) gel, and competition in Europe from laser and injectable products. Income before taxes and minority interest was approximately $1.4 million for the Aesthetic Technologies(TM) Group. During the quarter, Hylaform(R) viscoelastic gel was launched in Belgium, Greece, the Netherlands and Spain, bringing the number of countries where Hylaform(R) gel is currently available to 13 following the product launch last November. Hylaform(R) gel is an injectable implant developed by Biomatrix, Inc., based on its new hylan biopolymers. Many physicians are finding that Hylaform(R) gel plays a complementary role to Zyderm(R) and Zyplast(R) implants by offering patients immediate benefit for the treatment of their wrinkles wrinkles See bells and whistles. and scars (because no skin test is required) as well as providing a treatment option to those patients who may be sensitive to injectable collagen products. "During the quarter, we completed our search for a Managing Director of International by hiring an experienced professional, Jean-Pierre Capdevielle. Jean-Pierre and his group are geared-up to sell three aesthetic product lines -- the broadest in the Company's 22 year history -- consisting of our Collagen Replacement Therapy(R) products, Hylaform(R) viscoelastic gel, and the Trilucent(TM) breast implant. This was also the first full quarter of Hylaform(R) gel sales in Europe, which met our internal expectations. Physician interest in Hylaform(R) gel remains high and we look forward to introducing Hylaform(R) gel to the Scandinavian marketplace very soon," stated Gary Petersmeyer, president and chief executive officer. "On a separate note, I am very pleased to confirm that we have received orders to ship Contigen(R) implant to C.R. Bard ("Bard") in the fourth quarter ending June 30, 1997. These are the first orders for the product since Collagen Corporation stopped shipping Contigen(R) implant to Bard almost two years ago, in order for Bard to work down its excess inventories. Moreover, I am happy to report that we recently started a feasibility study "A Feasibility Study" is an episode of the original The Outer Limits television show. It first aired on 13 April, 1964, during the first season. It was remade in 1997 as part of the revived The Outer Limits series with a minor title change. being conducted with a polyethylene polyethylene (pŏl'ēĕth`əlēn), widely used plastic. It is a polymer of ethylene, CH2=CH2, having the formula (-CH2-CH2-)n glycol-collagen ("PEG-collagen") formulation, currently called "CP-1," for the treatment of facial wrinkles. This study is being conducted to determine CP-1's potential to lengthen length·en tr. & intr.v. length·ened, length·en·ing, length·ens To make or become longer. length  en·er n. the persistence of wrinkle WrinkleA feature of a new product or security intended to entice a buyer. correction compared to Zyplast(R) collagen implant. We believe this technology is very promising and could possibly double the length of time facial wrinkles and scars maintain correction. CP-1 is being studied pursuant to an investigational device exemption An Investigational Device Exemption (IDE) allows the investigational device to be used in a clinical study in order to collect safety and effectiveness data required to support a Premarket Approval (PMA) application or a Premarket Notification [510(k)] submission to Food and ("IDE (1) (Integrated Development Environment) A set of programs run from a single user interface. For example, programming languages often include a text editor, compiler and debugger, which are all activated and function from a common menu. ") and, should the feasibility study The analysis of a problem to determine if it can be solved effectively. The operational (will it work?), economical (costs and benefits) and technical (can it be built?) aspects are part of the study. Results of the study determine whether the solution should be implemented. demonstrate the desired results, will likely be followed by an expanded clinical study," continued Mr. Petersmeyer. Collagen Technologies Group The Collagen Technologies group has two important missions -- to manage Collagen's internal research and product development programs regarding innovative collagen-based technologies, and to incubate incubate /in·cu·bate/ (in´ku-bat) 1. to subject to or to undergo incubation. 2. material that has undergone incubation. in·cu·bate v. 1. dynamic, growing businesses that address carefully selected clinical challenges. During the third quarter of fiscal 1997, the Collagen Technologies Group spent more than $2.7 million on research and development in the areas of new biomaterials, vascular and general surgery, orthopedics and ophthalmology ophthalmology (ŏf'thălmŏl`əjē), branch of medicine specializing in the anatomy, function and diseases of the eye. Ophthalmologists specialize in the medical and surgical treatment of eye disorders, vision measurements for (excluding aesthetic medicine programs). Losses before income taxes and minority interest for Collagen Technologies was approximately $6.9 million. "I am delighted with the start of a clinical study by Cohesion Corporation (an 81-percent owned Collagen affiliate) with its collagen-based fibrin sealant A Fibrin sealant (also called fibrin glue) is a type of surgical tissue adhesive that is used during surgery to control bleeding. It is derived from human and animal blood products like fibrin. It is a blood fraction. . Cohesion's product is being studied for use in stopping or controlling bleeding at donor graft sites in patients undergoing elective surgery elective surgery Surgery Any operation that can be performed with advanced planning–eg, cholecystectomy, hernia repair, colonic resection, coronary artery bypass and burn patients requiring skin grafting Skin Grafting Definition Skin grafting is a surgical procedure by which skin or skin substitute is placed over a burn or non-healing wound to permanently replace damaged or missing skin or provide a temporary wound covering. . While progress is being made on many fronts within Collagen Technologies, this is the second of our affiliate investments in the last nine months (the other being Prograft Medical), to have a product in clinical studies," stated David Foster  This article or section resembles a .Please help [ improve this article] by removing excessive trivia, irrelevant praise and criticism, lists and collections of links that are of . , senior vice president and general manager of the Collagen Technologies Group. During the quarter, the Board of Directors of CollOptics, Inc., a 47-percent owned affiliate of Collagen Corporation, decided to put development efforts on hold until a suitable corporate partner can be identified to sponsor product development and marketing efforts. Collagen Corporation is a technology-based company that develops, manufactures and markets biomedical bi·o·med·i·cal adj. 1. Of or relating to biomedicine. 2. Of, relating to, or involving biological, medical, and physical sciences. devices for the treatment of defective, diseased dis·eased adj. 1. Affected with disease. 2. Unsound or disordered. , traumatized or aging human tissues. Except for the historical information contained herein, the matters discussed in this press release are 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. , the accuracy of which is necessarily subject to risks and uncertainties. The clinical efficacy of and market demand for new products and future operating results and expenses, among other matters discussed in this release, may differ significantly from the discussion of such matters in the forward-looking statements. Such differences may be based upon factors within Collagen Corporation's control, such as strategic planning Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy, including its capital and people. decisions by management and reallocation Noun 1. reallocation - a share that has been allocated again allocation, allotment - a share set aside for a specific purpose 2. reallocation of internal resources, or on factors outside of Collagen Corporation's control, such as scientific advances by third parties, introductions of competitive products and delays by regulatory authorities Noun 1. regulatory authority - a governmental agency that regulates businesses in the public interest regulatory agency administrative body, administrative unit - a unit with administrative responsibilities , as well as those factors set forth under the heading "Factors That May Affect Future Results of Operations" in Collagen's Form 10-Q Form 10-Q See 10-Q. for the fiscal quarter ended December 31, 1996. Collagen Corporation's press releases can be accessed on the Internet at http://www.businesswire.com/cnn/cgen.htm (Consolidated Balance Sheet consolidated balance sheet A balance sheet in which assets and liabilities of a parent company and its controlled subsidiaries are combined, thereby presenting balance sheet items for the parent and its subsidiaries as if they were a single firm. and Statements of Operations Information to Follow) -0-
COLLAGEN CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share amounts)
Three Months Ended Nine Months Ended
March 31, March 31,
1997 1996 1997 1996
------- ------ ------- ------
Revenues:
Product Sales $ 16,527 $ 16,587 $ 52,369 $ 50,410
Other --- --- --- 2,000
------ ------ ------ ------
16,527 16,587 52,369 52,410
------ ------ ------ ------
Costs and expenses:
Cost of sales 4,461 5,207 14,927 14,278
Selling, general and
administrative 10,963 10,051 30,291 28,820
Officer severance cost 2,006 --- 2,006 ---
Research and development 4,558 3,424 13,244 8,928
Acquired in-process research
and development --- --- --- 14,800
------ ------ ------ ------
21,988 18,682 60,468 66,826
------ ------ ------ ------
Loss from operations (5,461) (2,095) (8,099) (14,416)
Other income (expense):
Net gain on investments,
principally Target
Therapeutics, Inc. --- 36,285 9,222 67,672
Equity in losses of
affiliates, net (133) (690) (730) (783)
Interest income 238 291 897 742
Interest expense (120) (35) (351) (87)
------ ------ ------ ------
Income (loss) before income
taxes and minority interest (5,476) 33,756 939 53,128
Provision (benefit) for
income taxes (1,726) 14,356 1,674 32,809
Minority interest (189) --- (491) ---
------- ------- ------ ------
Net income (loss) $ (3,561) $ 19,400 $ (244) $ 20,319
======== ======= ======= ========
Net income (loss) per
share $ (.41) $ 2.14 $ (.03) $ 2.24
======== ======== ======== ========
Shares used in calculating
per share information 8,764 9,084 8,951 9,086
========= ======== ======== ========
COLLAGEN CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands, except share and per share amounts)
March 31, June 30,
1997 1996 (a)
-------- ---------
ASSETS
Current assets:
Cash and cash equivalents $ 12,529 $ 21,676
Short-term investments 5,984 3,691
Accounts receivable, net 8,912 9,508
Inventories, net 13,840 9,563
Other current assets, net 9,957 11,496
-------- --------
Total current assets 51,222 55,934
Property and equipment, net 15,922 15,147
Intangible assets and goodwill, net 13,126 14,824
Investment in Target
Therapeutics, Inc.(b) 83,890 65,841
Other investments & assets, net 14,284 11,261
------- -------
$178,444 $163,007
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 2,753 $ 3,824
Other accrued liabilities 12,858 11,869
Income taxes payable 2,990 7,588
Notes payable 5,068 5,079
------ ------
Total current liabilities 23,669 28,360
Long-term liabilities:
Deferred income taxes 37,037 27,674
Other long-term liabilities 3,854 3,444
Minority interest 141 528
------ ------
Total long-term liabilities 41,032 31,646
Commitments and contingencies --- ---
Stockholders' equity:
Preferred stock, $.01 par value,
authorized: 5,000,000 shares;
none issued and outstanding --- ---
Common stock, $.01 par value,
authorized: 28,950,000 shares,
issued: 10,735,975 shares at March
31, 1997 (10,575,614 shares at
June 30, 1996), outstanding:
8,788,075 shares at March 31, 1997
(8,775,614 shares at June 30, 1996) 108 106
Additional paid-in capital 66,576 64,844
Retained earnings 41,265 42,378
Cumulative translation adjustment (1,546) (656)
Unrealized gain on available-for-sale
investments 48,106 34,549
Treasury stock, at cost, 1,947,900
shares at March 31, 1997
(1,800,000 shares at June 30, 1996) (40,766) (38,220)
-------- --------
Total stockholders' equity 113,743 103,001
-------- --------
$178,444 $163,007
======== ========
(a) Amounts derived from audited financial statements at the date
indicated.
(b) Converted to 1.36 million shares of Boston Scientific
Corporation on April 8, 1997.
CONTACT: Collagen Corporation Norman Halleen, 415/856-0200 or Edelman Public Relations public relations, activities and policies used to create public interest in a person, idea, product, institution, or business establishment. By its nature, public relations is devoted to serving particular interests by presenting them to the public in the most Jon Greer, 415/433-5381 |
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