Curis Reports Third Quarter 2004 Results.CAMBRIDGE, Mass. -- Curis, Inc. (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 :CRIS), a therapeutic drug development company, today reported its financial results for the quarter ended September 30, 2004. For the third quarter of 2004, the Company reported a net loss applicable to common stockholders of $3,906,000 or $0.09 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, as compared to net income of $4,550,000 or $0.11 per diluted share for the prior year period. Revenues for the third quarter of 2004 were $1,486,000 as compared to $9,309,000 in the same period of 2003. The decrease was primarily due to the recognition by the Company in the third quarter of 2003 of $8,555,000 in previously deferred revenue upon the termination of its product development and target research agreements with Micromet. Revenues for the third quarter of 2004 were primarily derived from the Company's ongoing collaborations with Genentech, Inc. (NYSE NYSE See: New York Stock Exchange : DNA DNA: see nucleic acid. DNA or deoxyribonucleic acid One of two types of nucleic acid (the other is RNA); a complex organic compound found in all living cells and many viruses. It is the chemical substance of genes. ) and Wyeth Pharmaceuticals, a division of Wyeth (NYSE: WYE). In addition, during the third quarter of 2004 the Company began to record revenues under a $5,364,000 three-year grant that it received during the quarter from the Spinal Muscular Atrophy Spinal Muscular Atrophy (SMA) is a term applied to a number of different disorders, all having in common a genetic cause and the manifestation of weakness due to loss of the motor neurons of the spinal cord and brainstem. Foundation. 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 third quarter of 2004 were $5,445,000 as compared to $4,784,000 for the third quarter of 2003, an increase of $661,000 or 14%. Within operating expenses, the Company recorded general and administrative expenses of $2,112,000 for the third quarter of 2004 as compared to $1,651,000 for the same period in the prior year, an increase of $461,000 or 28%. The increase principally resulted from expenses associated with technology acquisition evaluation and increases in personnel costs. Research and development expenses for the third quarter of 2004 were $2,947,000 as compared to $2,823,000 for the third quarter of 2003, an increase of $124,000 or 4%. For the nine-month period ended September 30, 2004, the Company reported a net loss applicable to common stockholders of $12,245,000 or $0.30 per diluted share, versus a net loss of $4,959,000 or $0.14 per diluted share for the nine-month period ended September 30, 2003. Revenues for the nine-month period ended September 30, 2004 were $3,462,000 as compared to $10,293,000 for the nine-month period ended September 30, 2003. Operating expenses for the nine-month period ended September 30, 2004 were $15,966,000 as compared to $15,273,000 for the same period in 2003, an increase of $693,000 or 5%. Within operating expenses, the Company recorded general and administrative expenses of $6,266,000 for the first nine months of 2004 as compared to $4,997,000 for the same period in the prior year, an increase of $1,269,000 or 25%. The increase principally resulted from expenses associated with technology acquisition evaluations, increases in personnel costs, and costs associated with a financing that was not completed during the first half of 2004. Research and development expenses for the nine-month period ended September 30, 2004 were $8,585,000 as compared to $9,010,000 for the nine-month period ended September 30, 2003, a decrease of $425,000 or 5%. As of September 30, 2004, cash and investments were $32,541,000, and there were 41,813,512 shares of common stock outstanding. In October 2004, Curis completed a registered direct offering of common stock under which the Company sold an aggregate of 5,476,559 shares of its common stock, together with warrants to purchase 0.10 shares of common stock for each share of common stock purchased, at $3.67 per share. The warrants, to purchase an aggregate of 547,656 additional shares of common stock, expire on October 14, 2009 and are exercisable at $4.59 per share. This sale provided 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 $18,900,000 to Curis. After giving effect to the net proceeds of this offering, Curis expects to have cash and investments in the range of $45,000,0000 and $47,000,000 at December 31, 2004. Daniel Passeri, Curis' President and Chief Executive Officer, said, "We are pleased about the success of our recent registered direct offering. The net proceeds will allow us to continue to advance our key programs. In particular, these proceeds will allow us to exercise our co-development option for the basal cell carcinoma basal cell carcinoma n. A slow-growing, locally invasive, but rarely metastasizing neoplasm of the skin derived from basal cells of the epidermis or hair follicles. Also called basal cell epithelioma. product candidate with our collaborator, Genentech. While we have not made our final decision relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the basal cell carcinoma co-development option, we currently expect that we will exercise this option either in late 2004 or early 2005. In addition, we continue to make good progress in all of our major programs and partnerships. The addition of the sponsored research program with the Spinal Muscular Atrophy Foundation during the past quarter provides another validation See validate. validation - The stage in the software life-cycle at the end of the development process where software is evaluated to ensure that it complies with the requirements. of our technological approach to drug development. We believe that this approach has broad applicability and can be used to identify drug candidates for many other diseases and disorders." Third Quarter 2004 Highlights --The initiation of a $5.4 million three-year grant from the Spinal Muscular Atrophy Foundation to Curis to support research and development efforts to identify a small molecule drug to treat spinal muscular atrophy and other motor neuron motor neuron n. A neuron that conveys impulses from the central nervous system to a muscle, gland, or other effector tissue. Motor neuron disorders. --Several new third party scientific reports linking abnormal expression of the Hedgehog hedgehog, Old World insectivorous mammal of the family Erinaceidae, related to moles and shrews. The spiny hedgehogs are found in Africa and Eurasia, except SE Asia. They have rounded bodies up to 13 in. pathway to various cancers, including breast cancer, prostate cancer prostate cancer, cancer originating in the prostate gland. Prostate cancer is the leading malignancy in men in the United States and is second only to lung cancer as a cause of cancer death in men. , and medulloblastoma, coupled with several reports demonstrating the effectiveness of Hedgehog pathway antagonists antagonists, n muscles that counterbalance agonists during specific movements. opioid Neurology A pain-attenuating peptide that occurs naturally in the brain, which induces analgesia by mimicking endogenous opioids at opioid in blocking the growth of these cancers in preclinical preclinical /pre·clin·i·cal/ (-klin´i-k'l) before a disease becomes clinically recognizable. pre·clin·i·cal adj. 1. tumor tumor: see neoplasm. models. --Additional third party scientific reports demonstrating the importance of the Hedgehog pathway to the promotion of new blood vessel blood vessel n. An elastic tubular channel, such as an artery, a vein, a sinus, or a capillary, through which the blood circulates. blood vessel(s), n the network of muscular tubes that carry blood. growth, including one report that concluded that formation of new blood vessels Blood vessels Tubular channels for blood transport, of which there are three principal types: arteries, capillaries, and veins. Only the larger arteries and veins in the body bear distinct names. contributed to restoration of nerve function in a model of diabetes induced nerve damage. --In July, Curis was issued a new patent, 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: "Neuroprotective methods and reagents" which covers claims for treating stroke and other neurological disorders This is a list of major and frequently observed neurological disorders (e.g. Alzheimer's disease), symptoms (e.g.back pain), signs (e.g. aphasia) and syndromes (e.g. Aicardi syndrome). by activation activation /ac·ti·va·tion/ (ak?ti-va´shun) 1. the act or process of rendering active. 2. the transformation of a proenzyme into an active enzyme by the action of a kinase or another enzyme. 3. of the Hedgehog pathway. The Company will hold a conference call today, October 26, 2004, at 2:00 P.M. EST P.M. also p.m. or p.m. abbr. post meridiem Usage Note: By definition, 12 a.m. to discuss these results, the progress of its therapeutic product development programs, and additional corporate activities. Daniel Passeri, President and Chief Executive Officer of Curis, will host the call. To access the live conference call, please call 800-237-9752 from the 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. or Canada or 617-847-8706 from other locations, shortly before 2:00 P.M. EST. The conference ID number is 24250157. Replay will be available approximately two hours after the completion of the call and through 5:00 P.M. EST, Tuesday, November 9, 2004. To access the replay, please call 888-286-8010 from the United States or Canada or 617-801-6888 from other locations and reference the conference ID number 88526077.
CURIS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three months ended Nine months ended
September 30, September 30,
2004 2003 2004 2003
------------ ----------- ------------- ------------
Revenues $1,486,226 $9,308,838 $3,462,100 $10,293,138
------------ ----------- ------------- ------------
Operating expenses:
Research and
development 2,946,962 2,822,855 8,584,658 9,009,957
General and
administrative 2,111,520 1,650,647 6,265,967 4,996,517
Stock-based
compensation 368,060 291,241 1,058,678 1,210,435
Amortization of
intangible
assets 18,768 18,769 56,304 56,311
------------ ----------- ------------- ------------
Total
operating
expenses $5,445,310 $4,783,512 $15,965,607 $15,273,220
------------ ----------- ------------- ------------
Net income (loss)
from operations $(3,959,084) $4,525,326 $(12,503,507) $(4,980,082)
------------ ----------- ------------- ------------
Other income, net 53,384 24,590 258,622 292,402
------------ ----------- ------------- ------------
Net income (loss) (3,905,700) 4,549,916 (12,244,885) (4,687,680)
Accretion of
preferred stock
dividend - - - (271,306)
------------ ----------- ------------- ------------
Net income (loss)
applicable to
common
stockholders $(3,905,700) $4,549,916 $(12,244,885) $(4,958,986)
============ =========== ============= ============
Basic net income
(loss) per common
share $(0.09) $0.12 $(0.30) $(0.14)
============ =========== ============= ============
Weighted average
common shares for
basic net income
(loss)
computation 41,620,123 38,282,799 41,398,656 34,529,106
============ =========== ============= ============
Diluted net income
(loss) per common
share $(0.09) $0.11 $(0.30) $(0.14)
============ =========== ============= ============
Weighted average
common shares for
diluted net
income (loss)
computation 41,620,123 42,031,957 41,398,656 34,529,106
============ =========== ============= ============
CURIS, INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
September 30, December 31,
2004 2003
------------ ------------
ASSETS
Cash, cash equivalents, marketable
securities and long-term investments $32,541,246 $37,537,993
Cash equivalents - restricted 193,166 190,661
Accounts receivable 2,581,341 4,184,973
Property and equipment, net 2,710,459 2,500,703
Intangible assets, net 9,102,890 9,159,193
Other assets 2,396,990 2,162,967
------------ ------------
Total assets $49,526,092 $55,736,490
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable and accrued expenses $3,335,649 $2,884,643
Capital lease and debt obligations 594,354 322,884
Convertible debt 5,615,688 5,333,733
Deferred revenue 9,065,663 8,330,017
------------ ------------
Total liabilities 18,611,354 16,871,277
Total stockholders' equity 30,914,738 38,865,213
------------ ------------
Total liabilities and stockholders' equity $49,526,092 $55,736,490
============ ============
About Curis, Inc. Curis, Inc. is a therapeutic drug development company. Curis' technology focus is on regulatory pathways that control repair and regeneration Regeneration (biology) The process by which an animal restores a lost part of its body. Broadly defined, the term can include wound healing, tissue repair, and many kinds of restorative activities. . Curis' product development program involves using proteins, small molecules and other approaches to modulate To insert a data signal into a carrier wave or direct current. See modulation. these pathways. Curis has successfully used this technology and product development strategy to produce several promising product candidates in the fields of kidney disease Kidney Disease Definition Kidney disease is a general term for any damage that reduces the functioning of the kidney. Kidney disease is also called renal disease. , neurological disorders, cancer, and hair growth regulation. Curis is based in Cambridge, Massachusetts This article is about the city of Cambridge in Massachusetts. For the English university town, see Cambridge, England. For other places, see Cambridge (disambiguation). Cambridge, Massachusetts is a city in the Greater Boston area of Massachusetts, United States. . For more information, please visit the Curis web site at www.curis.com. 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. 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, including statements concerning Curis' expectations concerning the applicability and promise of the Company's technological approach to drug development and expectations regarding the future amount of Curis' cash and investments. Forward looking statements used in this press release may contain the words "believes", "expects", "anticipates", "plans", "seeks", "estimates" or similar expressions. These forward looking statements are not guarantees of future performance and involve risks, uncertainties, assumptions and other factors that may cause Curis' actual results to be materially different from those indicated by such forward-looking statements. Actual results can be affected by a number of important factors including, among other things: adverse results in Curis' and its strategic collaborators' product development programs; difficulties or delays in obtaining or maintaining required regulatory approvals; Curis' ability to obtain or maintain the patent and other proprietary intellectual property protection necessary for the development and commercialization of products based on its technologies; changes in or Curis' inability to execute its business plan; the risk that Curis does not obtain the additional funding required to conduct research and development of its product candidates and execute on its business plan; unplanned cash requirements and expenditures; risks relating to Curis' ability to enter into and maintain important strategic collaborations, including its ability to maintain its current collaboration agreements with Genentech, Ortho Biotech bi·o·tech n. Informal Biotechnology. biotech Noun short for biotechnology Noun 1. and Wyeth; the risk that competitors will discover and develop signaling pathway-based 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. faster and more successfully than Curis and its collaborators are able to; and other risk factors identified in Curis' Quarterly Report on Form 10-Q Form 10-Q See 10-Q. and other reports periodically filed with the Securities and Exchange Commission. In addition, any forward-looking statements represent the Company's views only as of today and should not be relied upon as representing its views as of any subsequent date. Curis disclaims any intention or obligation to update any of the forward-looking statements after the date of this press release whether as a result of new information, future events or otherwise. |
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