CAMBRIDGE, Mass., Jan. 28 /PRNewswire-FirstCall/ -- Biopure Corporation
(Nasdaq: BPUR) today announced its financial results for the fourth fiscal
quarter and the fiscal year ended October 31, 2007. Included in the net
loss for the fiscal quarter and fiscal year ended October 31, 2007 is a
one-time, non-cash impairment charge of $11.3 million. For the quarter, the
company reported a net loss of $16.7 million, or $1.07 per common share,
compared with a net loss of $6.3 million, or $0.66 per common share, for
the corresponding period in 2006. For the fiscal year, the company reported
a net loss of $36.3 million, or $2.43 per common share, compared with a net
loss of $26.5 million, or $3.35 per common share, for the year 2006. Class
A common shares outstanding on October 31, 2007 and 2006 were 15,593,587
and 9,873,025, respectively.
Revenues
Total revenues for the fourth quarter of 2007 were $793,000, including
$718,000 from sales of the company's veterinary product Oxyglobin(R),
$63,000 from sales of Hemopure(R) in South Africa and $12,000 in research
and development expense reimbursements from the U.S. government. Total
revenues for the same period in 2006 were $431,000, including $288,000 from
Oxyglobin sales, $29,000 from sales of Hemopure(R) and $114,000 from
government reimbursements. Payments from the government reimburse Biopure
for trauma development expenses for Hemopure and vary with the amount of
reimbursable activity of the Company.
Oxyglobin revenues increased during the fourth fiscal quarter of 2007
compared to 2006 largely because of a change in arrangements between the
Company and its European distributor. In 2006 the Company accounted for
European sales on a consignment basis. Now the distributor buys shipments
of product outright. Hemopure sales increased during the fourth fiscal
quarter of 2007 compared to 2006 due to the Company's marketing efforts and
increasing use of the product in South Africa.
For the fiscal year, total revenues were $2.6 million, including $2.1
million from sales of Oxyglobin(R), $143,000 from sales of Hemopure(R) and
$281,000 from government reimbursements. Revenues in 2006 were $1.7
million, including $1.3 million from Oxyglobin sales, $37,000 from Hemopure
sales and $410,000 from government reimbursements. The increase in
Oxyglobin sales is due to a higher average selling price in fiscal 2007
compared to fiscal 2006 and to the change in selling arrangement with the
European distributor.
Cost of product revenues was $2.6 million for the fourth quarter of
fiscal 2007, compared to $2.6 million for the same period in 2006. Cost of
product revenues was $11.7 million for fiscal year 2007 and $12.0 million
for fiscal year 2006. Cost of product revenues includes cost of both
Oxyglobin and Hemopure.
Hemopure cost of revenues, consisting primarily of the allocation of
unabsorbed fixed manufacturing costs, was $1.8 million for the fourth
quarter of fiscal 2007 and $2.1 million for the same period in 2006. This
decrease was largely due to lower depreciation expense related to an
impaired asset discussed below. For the fiscal year, Hemopure cost of
revenues decreased $604,000 in fiscal 2007 compared to 2006 largely because
of an $831,000 greater inventory write-down in 2006 and to lower
depreciation expense in 2007.
Oxyglobin cost of revenues was $840,000 for the fourth quarter of
fiscal 2007 compared to $534,000 for the same period in 2006. For the
fiscal year, Oxyglobin cost of revenues increased to $2.9 million in 2007
compared to $2.7 million in 2006. The increase for the quarter and the
fiscal year is largely due to a greater number of units sold in the United
Kingdom than were sold in 2006.
Expenses
Research and development expenses were $1.6 million for the fourth
quarters of fiscal 2007 and 2006. For the fiscal year, research and
development expenses were $7.0 million in fiscal 2007 compared to $6.7
million in 2006. For the fiscal year, the increase was primarily due to
increases in employee-related expenses and spending on preclinical studies
compared to fiscal 2006. These increases were partially offset by lower
spending on outside services and on regulatory filing fees.
Sales and marketing expenses increased to $290,000 for the fourth
quarter of fiscal 2007, from $147,000 for the same period in 2006, mainly
due to increased spending for sales activities in South Africa. For the
2007 fiscal year, sales and marketing expense increased to $1.4 million
compared to $671,000 in fiscal 2006, due to planning activities for
Hemopure in the U.K. and increased spending in South Africa.
General and administrative expenses were $1.8 million for the fourth
quarter of fiscal 2007 compared to $2.5 million for the corresponding
period in 2006 due to lower consulting and legal expenses. For the 2007
fiscal year, general and administrative expenses were $8.2 million for
fiscal 2007 compared to $9.3 in fiscal 2006 primarily due to lower
consulting, legal and severance expenses and insurance premiums in 2007.
The company recorded a one-time, non-cash impairment charge of $11.3
million in the fourth quarter of fiscal 2007 for an asset consisting of
engineering and design of a large-scale manufacturing facility. The
adjustment was recorded during the audit of the 2007 financial statements.
The company determined this asset was impaired pursuant to the applicable
accounting rules, primarily due to continued delays in plans to construct
the facility, significant clinical and US regulatory delays and a
modification in clinical development strategy. However, if Hemopure is
approved for an indication with broad application in a major market, the
company believes that at some point in the future it would ultimately
exceed its existing plant capacity and require the construction of the
designed facility.
Financial Condition
At October 31, 2007, Biopure had $1.9 million in cash on hand. On
November 16, 2007, the company completed a public offering of common stock
and warrants that raised net proceeds to Biopure of approximately $14.9
million.
Recent Developments
Pending Market Authorization Application
In July 2006, the Company submitted a marketing authorization
application to the United Kingdom's Medicines and Healthcare products
Regulatory Agency (MHRA) to market Hemopure in the United Kingdom. In
December 2006, the U.K. commission that reviews such applications rendered
a provisional opinion letter containing comments and questions on the
application. Biopure met with the MHRA during 2007 and responded in full to
its letter in early November. The time period for the MHRA's final decision
is not prescribed by law or regulation and can vary. A time period of four
to six months is typical. If a marketing authorization is granted in the
U.K., Biopure would have the option to seek registration of Hemopure for
the same indication in other states in the European Economic Area through a
mutual recognition procedure.
Clinical Program
Cardiopulmonary Bypass Surgery Trial. This trial, begun in 2006, is a
Phase 2 clinical trial in patients undergoing multi-vessel coronary artery
bypass graft (CABG) surgery. The objective of this trial is to assess the
safety and feasibility of Hemopure in reducing heart damage, as measured by
cardiac enzyme elevation, and enhancing tissue preservation during CABG
surgery. Secondary endpoints include measurements of major adverse cardiac
events, kidney function, transfusion requirements, cognitive impairment and
length of hospital stay. The trial has enrolled 52 patients, of a total of
60 provided for in the protocol.
Cardiac Procedures -- PCI Trials. Our first pilot ischemia trial was
designed to assess the product's safety in patients with single-vessel
coronary artery disease who were undergoing angioplasty and stenting
procedures, or percutaneous coronary intervention (PCI). This Phase 2
trial, completed in 2005, enrolled a total of 45 evaluable patients at five
hospitals in Germany, Belgium and The Netherlands.
A second PCI trial, a study in patients with multi-vessel coronary
artery disease who are undergoing PCI, was designed to capture additional
safety and preliminary efficacy data to support subsequent trials in
patients experiencing a heart attack. The hypothesis the trial was intended
to test is that Hemopure may improve oxygenation and heart function during
times of coronary artery blockage. This proof of concept trial enrolled
five patients, all at the Erasmus Medical Center in Rotterdam, The
Netherlands. The protocol had allowed for an enrollment of up to ten
subjects. However, the investigator stopped enrollment at the end of 2007,
after concluding that the results from five patients were sufficient to
show a trend towards proving the principle being tested.
Wound Healing. In 2006, patient enrollment also began in a Phase 2
clinical trial to assess the safety and feasibility of Hemopure in
increasing the incidence of complete wound healing and reducing the need
for subsequent amputations in patients with severe vascular disease who are
undergoing limb amputation. The rationale for this pilot trial was that the
product might promote wound healing by transporting oxygen through
partially blocked arteries to oxygen-deprived tissues. Because of slow
enrollment, the trial was stopped at the end of 2007 after enrolling 16 of
the proposed 100 patients. The slow enrollment in the trial was largely due
to a trial design that did not adequately take into account the different
clinical practices across both institutions and countries.
Trauma Trial. At the Johannesburg Hospital Trauma Unit in South Africa,
a company-sponsored, 50-patient Phase 2 safety trial of Hemopure in the
hospital emergency room setting remains ongoing. The patients in this trial
are unstable trauma patients who have significant blood loss and low blood
pressure. In December 2006, an independent data safety and monitoring board
reviewed the data from the first 21 patients in this trial, and recommended
that the trial continue without modification. The trial has enrolled 32 of
50 planned patients.
U.S. Navy Sponsored Research. During the fourth quarter, the U.S. Navy
agreed to buy Hemopure and seven different modifications of Hemopure for
preclinical testing. Biopure formulated and manufactured the modified
versions of Hemopure to test hypotheses concerning changes in formulation
in relation to physiological effects. That testing is now ongoing in eight
institutions under grants from the Navy aggregating $1.7 million and at
Navy facilities with Navy preclinical investigators. Based on information
to date, all of which is interim, we do not anticipate that these
modifications will supplant Hemopure. Proceeds to the Company from the
product sales are expected to be $1.6 million.
Compassionate Use Cases
Hemopure has been administered to 21 patients since January 2007 in the
U.S. on a "compassionate use" basis for the treatment of life-threatening
anemia when blood transfusion was not an option. The FDA granted a single
patient IND in each of these emergency situations and also approved
treatment for an additional 15 patients where the product was not
administered. Prior to these cases, there had been no compassionate use of
the product since 2000.
Abstracts Accepted
Four abstracts by Biopure and collaborating scientists were accepted
for presentation at the American Society for Clinical Pharmacology and
Therapeutics annual meeting to be held April 2-5, 2008. These abstracts
address the basis for adverse event outcomes and other key findings in
previous surgical studies of Hemopure. They also address the safety and
efficacy of both Hemopure and Hemoglobin-based oxygen carriers (HBOCs) in
general.
Chief Financial Officer
The company has engaged David A. Butler on a consulting basis as
interim CFO. Mr. Butler most recently served as Vice President, Finance and
Administration at the Millard Group, Inc., a services and consulting
company. Francis H. Murphy, formerly CFO, has retired but continues to
serve as a consultant to the company.
Nasdaq
On December 14, 2007 Biopure received notice from the Nasdaq Stock
Market that the closing bid price of its common stock had fallen and
remained below $1.00 for 30 consecutive business days. Consequently, the
company is out of compliance with Nasdaq's $1.00 minimum bid price
requirement for continued listing set forth in Marketplace Rule 4310(c)(4).
This notification has no effect on the listing of the Common Stock at this
time.
Biopure Corporation
Biopure Corporation develops, manufactures and markets pharmaceuticals,
called oxygen therapeutics, that are intravenously administered to deliver
oxygen to the body's tissues. Hemopure(R) [hemoglobin glutamer - 250
(bovine)], or HBOC-201, is approved for sale in South Africa for the
treatment of surgical patients who are acutely anemic. Biopure has applied
in the United Kingdom for regulatory approval of a proposed orthopedic
surgical anemia indication. The company is developing Hemopure for other
indications and is supporting the U.S. Navy's government-funded efforts to
develop a potential out-of-hospital trauma indication. Biopure's veterinary
product Oxyglobin(R) [hemoglobin glutamer - 200 bovine)], or HBOC-301, the
only oxygen therapeutic approved for marketing by both the U.S. Food and
Drug Administration and the European Commission, is indicated for the
treatment of anemia in dogs. Biopure has sold approximately 190,000 units
of Oxyglobin.
Statements in this release that are not strictly historical are
forward- looking statements, including those statements implying that any
clinical trial will be carried out to completion or that study results will
be as desired, and any statements that might imply that Hemopure may
receive marketing approval in the United Kingdom or any other jurisdictions
or for additional indications. Actual results and their timing may differ
materially from those projected in these forward- looking statements due to
risks and uncertainties. These risks include, without limitation,
uncertainties regarding the company's financial position, including its
limited cash resources and need to raise additional capital to pursue its
business, unexpected costs and expenses, delays and adverse determinations
by regulatory authorities, unanticipated problems with the product's
commercial use, whether or not product related, and with product
distributors, sales agents or other third parties, delays in clinical
trials, and the other factors identified under the heading "Risk Factors"
in the company's quarterly report on Form 10- Q filed on September 14,
2007, which can be accessed in the EDGAR database at the U.S. Securities
and Exchange Commission's (SEC) website, http://www.sec.gov, as can the
annual report on Form 10-K to be filed on January 29, 2008, with updated
risk factors. The company undertakes no obligation to release publicly the
results of any revisions to these forward- looking statements to reflect
events or circumstances arising after the date hereof. A full discussion of
the company's operations and financial condition can be found in the
company's filings with the SEC.
The content of this release does not necessarily reflect the position
or the policy of the U.S. Government or the Department of Defense, and no
official endorsement should be inferred.
BIOPURE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
Three Months Ended Twelve Months Ended
October 31 October 31
2007 2006 2007 2006
Total revenues $793 $431 $2,556 $1,715
Cost of product revenues 2,628 2,643 11,654 11,994
Gross loss (1,835) (2,212) (9,098) (10,279)
Operating expenses:
Research and development 1,575 1,550 6,972 6,662
Impairment charge -
engineering and design
asset 11,277 ----- 11,277 -----
Sales and marketing 290 147 1,389 671
General and administrative 1,823 2,489 8,188 9,315
Total operating expenses 14,965 4,186 27,826 16,648
Loss from operations (16,800) (6,398) (36,924) (26,927)
Other income, net 114 117 642 473
Net loss $(16,686) $(6,281) $(36,282) $(26,454)
Basic and diluted net
loss per common share $(1.07) $(0.66) $(2.43) $(3.35)
Weighted-average common
shares outstanding 15,593 9,511 14,920 7,886
The net loss per common share for the three and twelve month period
ended October 31, 2006 has been adjusted to reflect the one-for-five
reverse split that took effect on October 2, 2007.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
October 31, 2007 October 31, 2006
Assets
Total current assets $5,253 $10,621
Net property and equipment 8,398 22,406
Other assets 599 805
Total assets $14,250 $33,832
Liabilities and stockholders' equity
Total current liabilities $3,368 $4,216
Deferred revenue, net of current
portion 1,177 987
Restructuring costs, net of current
portion - 46
Other long term liabilities 41 41
Total liabilities 4,586 5,290
Total stockholders' equity 9,664 28,542
Total liabilities and stockholders'
equity $14,250 $33,832
Contact: Tiana Gorham Herb Lanzet (Investors)
Biopure Corporation H.L. Lanzet Inc.
(617) 234-6826 (212) 888-4570
IR@biopure.com lanzet@aol.com
SOURCE Biopure Corporation
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Related links:
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http://www.prnewswire.com/comp/131224.html /
CONTACT:
Tiana Gorham of Biopure Corporation,
+1-617-234-6826, IR@biopure.com, or Herb Lanzet (Investors) of
H.L. Lanzet Inc., +1-212-888-4570, lanzet@aol.com, for Biopure
Corporation
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