BIOMARIN REPORTS 1999 YEAR-END NET LOSS.
1999 Full Year Results
The net loss was $12,314,000 ($0.55 per share) and $28,072,000 ($0.94 per share) for 1998 and 1999, respectively.
For the years ended December 31, 1998 and 1999, revenues were $1,190,000 and $6,976,000, respectively. The reasons for this increase in revenues were the same as described for the fourth quarter increase in revenues.
Research and development expenses increased from $10,502,000 in 1998 to $27,206,000 in 1999. Increased expenses in support of the Aldurazyme joint venture with Genzyme and the MPS-VI and burn debridement programs were the major factors in the growth of research and development expenses.
Selling, general and administrative expenses increased from $3,532,000 for 1998 to $6,805,000 for 1999. This increase resulted from the consolidation of Glyko, Inc. selling and administrative expenses in 1999 expenses, an increase in staffing in BioMarin administration in 1999 compared to 1998, and an increase in facilities expense charged to administration in 1999. The increase in administrative staff and related expense was necessary to support expanded operations.
BioMarin's equity in the loss of its joint venture with Genzyme increased from $47,000 for 1998 (essentially a quarter) to $1,673,000 for 1999 (a full year) primarily as a result of increased process development and clinical manufacturing expenses.
Interest income increased by $1,147,000 from $685,000 for 1998 to $1,832,000 for 1999 primarily due to increased cash reserves resulting from a convertible note financing in April 1999, the initial public offering, and a concurrent private placement with Genzyme in July 1999. The interest expense accrued on the convertible notes prior to their conversion in the initial public offering totaled $720,000.
Grant W. Denison, Jr., BioMarin's chairman and CEO, stated, "1999 was a year of substantial achievement for BioMarin. We completed an IPO and two related financings which greatly improved our financial condition. We made significant investments in product programs, staff, facilities and technology to build a strong foundation for the future. We also advanced our product programs, with emphasis on Aldurazyme for MPS-I in collaboration with Genzyme."
BioMarin specializes in the discovery, development and commercialization of carbohydrate enzyme therapeutics. Since inception in 1997, BioMarin has applied its proprietary enzyme technology to the development of products in four therapeutic areas: genetic diseases, burn debridement, systemic fungal infections, and inflammation (psoriasis). Glyko, Inc., a BioMarin subsidiary, provides analytical and diagnostic products and services in the technological area of carbohydrate biology.
4th Quarter 1999 Results
Revenues for the fourth quarter of 1999 totaled $2,315,000 compared to revenues of $1,049,000 in the fourth quarter of 1998. Fourth quarter 1999 revenues included $1,889,000 for services provided to the joint venture for Aldurazyme(tm) compared to $696,000 for the same period in 1998 as a consequence of Aldurazyme being in more complex, later stages of development. The joint venture with Genzyme General (Nasdaq: GENZ) for the development and commercialization of Aldurazyme, alronidase for injection, (recombinant human a-L-iduronidase) for the treatment of Mucopolysaccharidosis-I (MPS-I) was formed on September 4, 1998. MPS-I is a chronic, debilitating genetic disease which afflicts children and leads to death before adulthood in a majority of patients. Fourth quarter 1999 revenues also included $387,000 generated by Glyko, Inc. compared to $250,000 for the fourth quarter of 1998. Glyko, Inc., a BioMarin subsidiary engaged in the sale of analytical and diagnostic products and services, was acquired by BioMarin on October 7, 1998. On a full quarter basis, Glyko, Inc. external revenues for products and services for the fourth quarter of 1999 were up 43% in comparison to the fourth quarter of 1998 as a result of revenues from the biochemical reagents business of Oxford GlycoSciences Plc. (LSE: OGS), which was acquired in May 1999. Other revenues decreased from $103,000 in the fourth quarter of 1998 to $39,000 in the fourth quarter of 1999 due to the reduction of grant revenue for Glyko, Inc. programs.
Cost of products and cost of services related to Glyko, Inc. operations were $131,000 in the fourth quarter of 1999 and were $108,000 in the comparable period of 1998. On a full quarter basis, Glyko's total external product and service costs as a percent of the sales of products and services were 34% in the fourth quarter of 1999 and 43% in the fourth quarter of 1998. The improvement was due to a favorable mix, with a greater percentage of higher margin product sales.
Research and development expenses for the fourth quarter of 1999 increased by $2,580,000 from $6,598,000 in the fourth quarter of 1998 to $9,178,000 in the fourth quarter of 1999. This increase was due primarily to increased activities in support of the joint venture for Aldurazyme and in support of the company's enzyme product candidates for MPS-VI and burn debridement.
Selling, general and administrative expenses increased from $760,000 in the fourth quarter of 1998 to $2,046,000 in the fourth quarter of 1999 due to increased BioMarin administrative staff expenses to support expanded operations and expenses associated with the new status as a publicly traded company.
BioMarin's equity in the loss of its joint venture with Genzyme was $650,000 for the fourth quarter 1999 compared to $47,000 for the same period of 1998.
Interest income increased by $440,000 from $216,000 in the fourth quarter of 1998 to $656,000 in the fourth quarter of 1999 due to increased cash reserves resulting from the initial public offering on July 23, 1999, a concurrent investment by Genzyme, and a convertible note financing in April 1999 that converted at the time of the initial public offering.
Net loss of $6,248,000 ($0.24 per share) in the fourth quarter of 1998 increased to $9,038,000 ($0.26 per share) in the comparable period of 1999.
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|Comment:||BIOMARIN REPORTS 1999 YEAR-END NET LOSS.|
|Publication:||Biotech Financial Reports|
|Article Type:||Brief Article|
|Date:||Apr 1, 2000|
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