Gilead Sciences Announces Second Quarter 2001 Financial Results; Company Announces Viread - VIR-ee-ad - as Trade Name for Tenofovir DF.Business/Technology Editors FOSTER CITY, Calif.--(BUSINESS WIRE)--July 26, 2001 Gilead Sciences Gilead Sciences NASDAQ: GILD is a biopharmaceutical company that discovers, develops and commercializes therapeutics to advance the care of patients suffering from life-threatening diseases. , Inc. (Nasdaq: GILD) announced today its results of operations for the second quarter ended June 30, 2001. For the second quarter, Gilead recorded revenues from net product sales of $41.6 million, royalty revenues of $6.4 million and contract revenues of $2.7 million. Total revenues for the second quarter ended June 30, 2001, were $50.7 million compared to total revenues of $50.1 million for the second quarter of 2000. Revenues for the second quarter of 2000 included net product sales of $38.0 million, royalty revenues of $7.7 million and contract revenues of $4.4 million. The net loss for the second quarter 2001 was $32.4 million, or $0.34 per share. This compares to a net loss in the second quarter 2000 of $4.0 million, or $0.04 per share. Net revenues from product sales were primarily derived from sales of AmBisome(R) (amphotericin B amphotericin B (ăm'fətĕr`ĭsĭn), antibiotic that halts the growth of several disease-causing fungi. Discovered in 1956, it is produced by bacteria of the genus Streptomyces. ) liposome liposome (lī`pəsōm', lĭp`ə–), microscopic, fluid-filled pouch whose walls are made of layers of phospholipids identical to the phospholipids that make up cell membranes. for injection, accounting for 94 percent of product sales for the second quarter of 2001. AmBisome sales for the second quarter of 2001 were $38.9 million, an increase of nine percent compared to the second quarter of 2000. Excluding the impact of the decline in foreign currencies relative to the U.S. dollar, AmBisome sales grew 16 percent for the second quarter of 2001 over the comparable quarter of 2000. In addition, Gilead recorded other product sales of $2.7 million during the second quarter of 2001, compared to $2.1 million in the second quarter of 2000. For the second quarter of 2001, royalty and contract revenues resulting from collaborations with corporate partners totaled $9.1 million. These revenues include contract revenues for research and development projects, royalties on sales of AmBisome in 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. by Gilead's co-promotion partner Fujisawa Healthcare, royalties on sales of Tamiflu(TM) (oseltamivir phosphate oseltamivir phosphate Tamiflu Pharmacologic class: Viral neuroaminidase inhibitor Therapeutic class: Antiviral Pregnancy risk category C Action) by Hoffmann-La Roche and royalties on product sales of Vistide(R) (cidofovir injection) outside the United States by Pharmacia Corporation.Research and development expenses for the second quarter of 2001 were $44.1 million, compared to $27.5 million for the same quarter in 2000. The higher spending during the second quarter of 2001 is attributable to Gilead's expenses associated with the Phase III Noun 1. phase III - a large clinical trial of a treatment or drug that in phase I and phase II has been shown to be efficacious with tolerable side effects; after successful conclusion of these clinical trials it will receive formal approval from the FDA clinical programs for Viread(TM) (tenofovir disoproxil fumarate tenofovir disoproxil fumarate Viread Pharmacologic class: Nucleoside analog reverse transcriptase inhibitor Therapeutic class: Antiretroviral Pregnancy risk category B ) for HIV HIV (Human Immunodeficiency Virus), either of two closely related retroviruses that invade T-helper lymphocytes and are responsible for AIDS. There are two types of HIV: HIV-1 and HIV-2. HIV-1 is responsible for the vast majority of AIDS in the United States. and adefovir dipivoxil adefovir dipivoxilHepsera Pharmacologic class: Nucleotide reverse transcriptase inhibitor Therapeutic class: Antiviral Pregnancy risk category C FDA Boxed Warningfor hepatitis B Hepatitis B DefinitionHepatitis B is a potentially serious form of liver inflammation due to infection by the hepatitis B virus (HBV). It occurs in both rapidly developing (acute) and long-lasting (chronic) forms, and is one of the most common chronic virus (HBV HBV hepatitis B virus. HBV abbr. hepatitis B virus ), including the ongoing expanded access Expanded access refers to the inclusion of patients in a clinical trial for a new therapeutic treatment or chemical entity, where those patients would not satisfy the enrolment criteria for the scientific study in progress. program and drug supply costs for Viread. Selling, general and administrative expenses for the three months ended June 30, 2001 were $29.7 million, compared to $19.6 million for the same quarter of 2000. The additional spending is primarily due to Gilead's increased global marketing efforts associated with the anticipated commercial launch of Viread. Net interest income for the second quarter 2001 was $3.1 million, compared to $2.8 million for the same quarter in 2000. The company also reported equity in the loss of its unconsolidated affiliate of $1.2 million and $0.7 million for the second quarter ended June 30, 2001 and 2000, respectively. The losses are derived from Gilead's 49 percent interest in Proligo L.L.C., a manufacturing joint venture between Gilead and SKW SKW Schweizerischer Kosmetik- und Waschmittelverband (Swiss union of cosmetics and detergents) SKW Strike Warfare Americas, Inc. Gilead also reported its results of operations for the six months ended June 30, 2001. The company recorded net revenues from product sales of $86.6 million and aggregate contract and royalty revenues of $21.9 million. Accounting for 93 percent of product sales, AmBisome sales for the six months ended June 30, 2001 were $80.8 million, a 15 percent increase over the six months ended June 30, 2000. Excluding the impact of the decline in foreign currencies relative to the U.S. dollar, AmBisome sales grew by 22 percent in the first six months of 2001 over the comparable period of 2000. Net revenues of $108.5 million in the six months ended June 30, 2001 compare to net revenues of $97.8 million in the first six months of 2000. Net revenues for the first six months of 2000 included product sales of $74.3 million and aggregate contract and royalty revenues of $23.5 million. The net loss for the six months ended June 30, 2001, including the cumulative effect of a change in accounting principle related to the company's adoption of Statement of Financial Accounting Standards No. 133, was $54.1 million, or $0.57 per share. This compares to a net loss of $21.0 million, or $0.23 per share for the six months ended June 30, 2000, including the cumulative effect of the adoption of Staff Accounting Bulletin 101 of $13.7 million, or $0.15 per share. Research and development expenses for the six months ended June 30, 2001 and 2000 were $95.2 million and $53.7 million, respectively. The higher spending during the first half of 2001 was attributable in part to the recognition of $10.6 million of a $13 million up-front payment to Cubist Pharmaceuticals related to the European licensing agreement for daptomycin signed in January 2001. In addition, Gilead's expenses associated with the Phase III clinical programs for Viread for HIV and adefovir dipivoxil for HBV increased significantly during the first half of 2001. Selling, general and administrative expenses for the six months ended June 30, 2001 were $51.6 million compared to $37.6 million for 2000. The additional spending is again primarily due to Gilead's increased global marketing efforts associated with the anticipated commercial launch of Viread. Net interest income for the six months ended June 30, 2001 was $6.9 million, compared to $5.2 million for 2000. The company also reported equity in the loss of its unconsolidated affiliate of $1.6 million for each of the six months ended June 30, 2001 and 2000. As of June 30, 2001, the company had cash, cash equivalents and 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 of $456.0 million, compared to $512.9 million at December 31, 2000. Products and Pipeline Highlights "During the second quarter we achieved several significant milestones in our antiviral programs," said John C. Martin, Ph.D., President and Chief Executive Officer, Gilead Sciences. "By rapidly submitting our NDA (Non Disclosure Agreement) An agreement signed between two parties that have to disclose confidential information to each other in order to do business. In general, the NDA states why the information is being divulged and stipulates that it cannot be used for any and MAA MAA abbr. macroaggregated albumin for Viread and meeting the primary efficacy endpoint in our first Phase III study of adefovir dipivoxil for HBV, we made important progress toward commercializing the next wave of Gilead's products. Over the remainder of the year, we are focused on preparing for the launch of Viread in the United States and Europe, and we look forward to announcing results of our second pivotal Phase III study of adefovir dipivoxil." Viread(TM) (tenofovir disoproxil fumarate) for HIV Today, Gilead announced that Viread has been selected as the brand name for tenofovir disoproxil fumarate in the United States and 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 . In May, Gilead submitted a New Drug Application to the U.S. Food and Drug Administration (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. ) for marketing approval of Viread. In June, Gilead was notified by the FDA that the filing has been granted priority review classification; Gilead expects FDA review and action within six months of the submission. Also in May, Gilead submitted a Marketing Authorisation Application (MAA) to the European Agency for the Evaluation of Medicinal Products medicinal product, n a substance administered to humans or animals through injection, application, oral ingestion, inhalation, and so forth, whose purpose is to ultimately restore health or eliminate disease in an individual. seeking approval of Viread. The MAA is being reviewed under the centralized cen·tral·ize v. cen·tral·ized, cen·tral·iz·ing, cen·tral·iz·es v.tr. 1. To draw into or toward a center; consolidate. 2. licensing procedure, which, if approved, will provide marketing authorization in all 15 member states of the 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. . The French authorities are the rapporteur rap·por·teur n. One who is designated to give a report, as at a meeting. [Middle English raportour, judge, from Old French raporteur, from raporter, to bring back , and the Spanish authorities are the co-rapporteur for the procedure. In June, Gilead presented in vitro in vitro /in vi·tro/ (in ve´tro) [L.] within a glass; observable in a test tube; in an artificial environment. in vi·tro adj. In an artificial environment outside a living organism. data further characterizing the resistance profile of Viread. These data were presented at the 5th International Workshop on HIV Drug Resistance HIV drug resistance Antiretroviral drug resistance AIDS The resistance of a strain of HIV to an agent–eg, a reverse transcriptase inhibitor, which occurs in 5%-20% of those newly infected with HIV and Treatment Strategies in Scottsdale, Arizona Scottsdale (O'odham Vaṣai S-vaṣonĭ) is a city in Maricopa County, Arizona, United States, adjacent to Phoenix. Scottsdale has become internationally recognized as a premier and posh tourist destination, while maintaining its own identity and culture as " . In this study, the resistance profile of tenofovir was evaluated using phenotypic phe·no·type n. 1. a. The observable physical or biochemical characteristics of an organism, as determined by both genetic makeup and environmental influences. b. analyses of nearly 5,000 clinically-derived HIV samples from predominantly treatment-experienced patients, which were provided and analyzed by Tibotec-Virco. Results of this study indicate that over 88 percent of the samples were fully susceptible to Viread and were within the normal three-fold range. In two additional presentations, Gilead researchers presented data describing the unique structural and enzymological features of tenofovir that may help to explain the compound's favorable resistance profile. Adefovir Dipivoxil for Hepatitis B Virus In June, Gilead unblinded 48-week data from Study 437, a randomized ran·dom·ize tr.v. ran·dom·ized, ran·dom·iz·ing, ran·dom·iz·es To make random in arrangement, especially in order to control the variables in an experiment. , double-blind, placebo-controlled Phase III trial designed to evaluate the safety and efficacy of adefovir dipivoxil given once daily, compared to placebo in 515 patients with chronic HBV infection. Results from this intent-to-treat analysis met the study's primary endpoint of improvement in liver histology histology (hĭstŏl`əjē), study of the groups of specialized cells called tissues that are found in most multicellular plants and animals. at week 48 compared to baseline. A number of secondary endpoints were met as well, including a higher rate of seroconversion seroconversion /se·ro·con·ver·sion/ (-con-ver´zhun) the change of a seronegative test from negative to positive, indicating the development of antibodies in response to immunization or infection. , a greater reduction in ALT levels and a larger decrease in circulating HBV 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. in the treatment arm as compared to placebo. Through the first 48 weeks of Study 437, the discontinuation dis·con·tin·u·a·tion n. A cessation; a discontinuance. Noun 1. discontinuation - the act of discontinuing or breaking off; an interruption (temporary or permanent) discontinuance rate, incidence of grade 3 and 4 laboratory abnormalities and clinical adverse events were similar between the treatment and placebo arms. Also in June, Gilead initiated Phase I trials of adefovir dipivoxil for the treatment of chronic HBV infection in China. The adefovir dipivoxil clinical program design in China will include three separate Phase I trials that will be conducted in sequential order. After the completion of Phase I studies, a final report reviewing the safety and pharmacokinetic (PK) profile of the drug will be submitted to the People's Republic People's Republic n. A political organization founded and controlled by a national Communist party. of China State Drug Administration (SDA SDA abbr. specific dynamic action Serotonin dopamine antagonist (SDA) The newer second-generation antipsychotic drugs, also called atypical antipsychotics. ). The Class 1 designation of adefovir dipivoxil allows for an expedited review of these data. After the SDA's review and subject to its approval, Gilead anticipates initiating a Phase II/III study of adefovir dipivoxil in China. Cidecin(R) (daptomycin for injection) for Gram-Positive Bacterial Infections Cubist Pharmaceuticals, Inc. announced earlier this month it completed enrollment of Study 9801, the second of its pivotal Phase III trials examining the efficacy and safety of investigational drug Cidecin for the treatment of complicated skin and soft tissue infection (cSST) in the United States. Preliminary results from Study 9801 are expected to be announced To be announced (TBA) A contract for the purchase or sale of an MBS to be delivered at an agreed-upon future date but does not include a specified pool number and number of pools or precise amount to be delivered. at the 39th Infectious Disease Infectious disease A pathological condition spread among biological species. Infectious diseases, although varied in their effects, are always associated with viruses, bacteria, fungi, protozoa, multicellular parasites and aberrant proteins known as prions. Society of America meeting in San Francisco San Francisco (săn frănsĭs`kō), city (1990 pop. 723,959), coextensive with San Francisco co., W Calif., on the tip of a peninsula between the Pacific Ocean and San Francisco Bay, which are connected by the strait known as the Golden in October. Further results from the first Phase III study, 9901, will be presented at the 41st Interscience Conference on Antimicrobial Agents and Chemotherapy Antimicrobial Agents and Chemotherapy (print-ISSN 0066-4804, CODEN AMACCQ; canceled ISSN 0074-9923, canceled CODEN AACHAX) is an academic journal published by the American Society for Microbiology. 2001 in Chicago this September. Cubist anticipates filing for regulatory approval of Cidecin in the United States mid-2002, and Gilead expects to follow with a filing in Europe. Gilead holds the exclusive rights to commercialize and market Cidecin in Europe. Conference Call Gilead will host a conference call today, July 26, 2001, at 4:30 p.m. ET. The dial-in number for the call is 888-849-9214 domestic; 212-676-5013 international. The replay of this call will be available from 7:00 p.m. July 26, 2001, until 7:00 p.m. on July 29, 2001. The dial-in number for the replay is 800-633-8284 domestic, 858-812-6440 international; the password is 19302054. Gilead also will be webcasting the conference call; this feature will be available on our website at www.gilead.com. The information provided on the teleconference and on the webcast is only accurate at the time of the call, and Gilead will take no responsibility for providing updated information. About Gilead Gilead Sciences, Inc., headquartered in Foster City, CA, is an independent biopharmaceutical company that seeks to provide accelerated solutions for patients and the people who care for them. Gilead discovers, develops, manufactures and commercializes proprietary therapeutics for challenging infectious diseases infectious diseases: see communicable diseases. (viral, fungal and bacterial infections) and cancer. Gilead maintains research, development or manufacturing facilities in Foster City, CA; Boulder, CO; San Dimas, CA; Cambridge, UK, and Dublin, Ireland, and sales and marketing organizations in the United States, Europe and Australia. Forward-looking Statements Statements included in this press release that are not historical in nature are "forward-looking statements" 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. These statements include those regarding Gilead's future financial results, including: revenues, research and development expenses, selling, general and administrative expenses, the efficacy of any marketed or pipeline development products, the ability to file for or obtain marketing approval for Gilead's pipeline development products, or the competitive positioning of its marketed or pipeline development products. Gilead cautions readers that forward-looking statements are subject to certain risks and uncertainties, which could cause actual results to differ materially. These risks and uncertainties include those that can cause fluctuations in our financial results, such as our ability and the ability of our partners to successfully market our products and maintain revenue growth; our ability to control the timing and amount of spending in our research and clinical programs; fluctuations in foreign currency against the U.S. dollar; our ability to achieve and the timing of milestones, as well as risk and uncertainties that affect our future prospects such as the risk that we may not continue to observe the safety, tolerability and efficacy data for our products and product candidates that we are observing today; other risks relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the regulatory approval of our products and product candidates; and other risks identified from time to time in the company's reports filed with the U.S. Securities and Exchange Commission. The company directs readers to its 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. , for the year ended December 31, 2000, filed in March 2001, and its 2001 Quarterly Report on Form 10-Q Form 10-Q See 10-Q. filed in May 2001 with the SEC. Gilead claims the protection of the Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. contained in the Private Securities Litigation Reform Act of 1995 for forward-looking statements. All forward-looking statements are based on information currently available to Gilead, and Gilead assumes no obligation to update any such forward-looking statements. Note to Editors: Viread is a trademark of Gilead Sciences, Inc. For more information on Gilead Sciences, please visit www.gilead.com or call the Gilead Corporate Communications Corporate communications is the process of facilitating information and knowledge exchanges with internal and key external groups and individuals that have a direct relationship with an enterprise. Department at 1-800-GILEAD-5 (1-800-445-3235).
GILEAD SCIENCES, INC
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
Three months ended Six months ended
June 30, June 30,
-------------------- -------------------
2001 2000 2001 2000
--------- -------- --------- ---------
(unaudited) (unaudited)
Revenues:
Product sales, net $ 41,565 $ 37,994 $ 86,629 $ 74,334
Royalty revenue, net 6,376 7,680 12,558 15,722
Contract revenue 1,123 4,305 7,560 5,145
Contract revenue - SAB 101 1,623 150 1,776 2,640
---------- -------- ---------- --------
Net revenues 50,687 50,129 108,523 97,841
Cost of goods sold 10,797 8,684 21,378 16,631
---------- -------- ---------- --------
Gross profit 39,890 41,445 87,145 81,210
Operating expenses:
Research and development 44,078 27,460 95,224 53,706
Selling, general and
administrative 29,707 19,620 51,618 37,590
---------- -------- ---------- --------
Total operating expenses 73,785 47,080 146,842 91,296
---------- -------- ---------- --------
Loss from operations (33,895) (5,635) (59,697) (10,086)
Interest income 6,507 4,360 13,890 8,305
Interest expense (3,436) (1,518) (6,969) (3,055)
---------- -------- ---------- --------
Loss before provision for
income taxes, equity in
loss of unconsolidated
affiliate and cumulative
effect of change in
accounting principle (30,824) (2,793) (52,776) (4,836)
Provision for
income taxes 323 525 793 832
Equity in loss of
unconsolidated affiliate 1,240 718 1,630 1,639
---------- -------- ---------- --------
Loss before cumulative
effect of change in
accounting principle (32,387) (4,036) (55,199) (7,307)
Cumulative effect of
change in accounting
principle (note 1) - - 1,089 (13,670)
---------- -------- ---------- --------
Net loss $ (32,387) $ (4,036) $(54,110) $(20,977)
========== ======== ========= ========
Basic and diluted amounts
per common share: (note 2)
Loss before cumulative
effect of change in
accounting principle $ (0.34) $ (0.04) $ (0.58) $ (0.08)
Cumulative effect of
change in accounting
principle - - 0.01 (0.15)
---------- --------- --------- ---------
Net loss $ (0.34) $ (0.04) $ (0.57) $ (0.23)
========== ========= ========= =========
Common shares used in
the calculation of
basic and diluted
amounts per share 94,779 89,182 94,576 88,931
========== ========= ========= ========
Notes:
(1) Gilead adopted Statement of Financial Accounting Standards No. 133
(SFAS 133) Accounting for Derivative Instruments and Hedging
Activities effective January 1, 2001 and also the SEC's Staff
Accounting Bulletin No. 101 (SAB 101) Revenue Recognition in
Financial Statements effective January 1, 2000. These changes were
accounted for as the cumulative effect of a change in accounting
principle.
(2) The net loss per share and number of shares used in the per share
calculation for all periods presented reflect the two-for-one
stock split effective February 22, 2001.
(3) Certain prior period amounts have been reclassified to conform
to the current presentation.
GILEAD SCIENCES, INC
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
June 30, December 31,
2001 2000
------------- -------------
(unaudited) (note 1)
Assets
Cash, cash equivalents and
marketable securities $ 456,022 $ 512,878
Other current assets 90,169 80,920
------------- -------------
Total current assets 546,191 593,798
Property, plant and equipment, net 60,141 55,174
Other noncurrent assets 30,330 29,127
------------- -------------
$ 636,662 $ 678,099
============= =============
Liabilities and stockholders' equity
Current liabilities $ 56,690 $ 58,238
Long-term obligations 265,557 268,737
Stockholders' equity 314,415 351,124
------------- -------------
$ 636,662 $ 678,099
============= =============
Notes:
(1) Derived from audited financial statements at that date.
|
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion