MOUNTAIN VIEW, Calif., Jan. 31 /PRNewswire/ -- Aviron (Nasdaq: AVIR) today
announced results for the fourth quarter and year ended December 31, 2000.
The company reported a net loss of $11.6 million (basic net loss of
$0.50 per share) for the fourth quarter of 2000, compared to a net loss of
$22.6 million (basic net loss of $1.40 per share) for the fourth quarter of
1999. The company reported a net loss of $90.3 million (basic net loss of
$4.36 per share) for fiscal 2000, compared to a net loss of $61.9 million
(basic net loss of $3.90 per share) for fiscal 1999.
Revenues in the fourth quarter of 2000 totaled $22.1 million, compared to
$2.4 million for the fourth quarter of 1999. Revenues for fiscal 2000 were
$32.2 million, as compared to $22.2 million for fiscal 1999. Fourth quarter
and full-year 2000 revenues were comprised principally of expense
reimbursements and a $15.5 million milestone due from Wyeth Lederle Vaccines
(Wyeth), a business unit of American Home Products Corporation (AHP). These
amounts were payable to Aviron under an ongoing global collaboration agreement
between the companies for the development and marketing of FluMist(TM),
Aviron's investigational intranasal influenza vaccine. Fourth quarter
1999 revenues were comprised principally of expense reimbursements from Wyeth.
Fiscal 1999 revenues also included the recognition of a $15.0 million
non-refundable license fee from Wyeth and other revenues from contracts and
research grants.
Aviron implemented Staff Accounting Bulletin No. 101, Revenue Recognition
in Financial Statements (SAB 101) in the fourth quarter of 2000. SAB
101 includes new guidelines from the Securities and Exchange Commission (SEC)
regarding revenue recognition of non-refundable up-front license fees, such as
the $15.0 million up-front payment Aviron received from Wyeth in 1999. In
accordance with SAB 101, this $15.0 million up-front license fee, which was
previously recognized as revenue in full in the first quarter of 1999, has
been deferred and is now being recognized as revenue over the development
period of FluMist(TM). As a result, we recorded a charge for the cumulative
effect of the change of $12.8 million as of January 1, 2000, adjusted
previously reported contract revenues for the first three quarters of 2000 to
reflect revenue of $750,000 per quarter and also recognized $750,000 of
revenue in the fourth quarter of 2000. Fiscal 1999 results will not be
restated.
Operating expenses in the fourth quarter of 2000 totaled $31.0 million,
compared to $24.0 million for the fourth quarter of 1999. Operating expenses
for fiscal 2000 totaled $105.3 million, as compared with $81.4 million for
fiscal 1999.
Research and development costs totaled $26.5 million in the fourth quarter
of 2000, as compared to $20.3 million in the fourth quarter of 1999 and
totaled $80.5 million for fiscal 2000, as compared with $68.2 million in
fiscal 1999. The increase in research and development costs was due primarily
to increases in development activities, clinical trials, and commercial scale-
up expenses associated with FluMist(TM). In addition, we recognized a one-
time, non-cash charge for the acquisition of in-process research and
development in the amount of $10.9 million in the first quarter of 2000 due to
the amendment of our agreement with the University of Michigan to accelerate
the issuance of a warrant to the university.
General, administrative and marketing costs increased to $4.5 million in
the fourth quarter of 2000 from $3.7 million in the fourth quarter of 1999,
and to $13.8 million for fiscal 2000, as compared to $13.2 million for fiscal
1999. The increase was due to growth in infrastructure and other costs to
support preparations for a potential commercial launch of FluMist(TM) in 2001.
In the fourth quarter of 2000, we exchanged approximately $51.7 million
aggregate principal amount of our 5 3/4 percent convertible subordinated notes
for 1,722,673 shares of our common stock in a number of privately negotiated
transactions. As a result, we recorded additional non-cash interest expense
related to the exchanges in the amount of approximately $2.7 million. The
$1.2 million of unamortized debt issue costs related to the notes exchanged
have been charged to additional paid-in capital. As of December 31, 2000,
approximately $48.3 million aggregate principal amount of the notes remained
outstanding.
Cash, cash equivalents, short-term investments and long-term investments
totaled $136.8 million at December 31, 2000, compared to $52.3 million at
December 31, 1999.
During October 2000, we restructured our manufacturing agreement with
Evans Vaccines Ltd. (Evans), a division of PowderJect Pharmaceuticals plc, in
order to gain direct control over FluMist(TM) manufacturing operations. In
conjunction with the restructuring of this agreement, we have recorded
$34.0 million of obligations to Evans. We have valued the aggregate
consideration at approximately $50.2 million, which we recorded as an asset
and will amortize over the remaining term of the agreement, which extends
through June 2006.
Company events during the fourth quarter of 2000 and the early first
quarter of 2001 include the following:
FluMist(TM)
-- On October 31, 2000, we submitted a Biologics License Application (BLA)
to the U.S. Food and Drug Administration (FDA) seeking licensure of
FluMist(TM) to prevent influenza in healthy children and healthy adults
and on December 28, 2000, the FDA accepted the BLA for review. This
acceptance triggered a $15.5 million payment to Aviron from Wyeth.
Operations
-- On October 11, 2000, we announced a restructuring of our contract
manufacturing agreement with Evans, transferring responsibility for
bulk manufacture of FluMist(TM) in the Speke, UK facility to our UK
subsidiary, Aviron UK Ltd.
-- Also on October 11, 2000, we announced that Aviron UK Ltd. had agreed
to acquire the remaining 24 years of a 25-year lease from Celltech
Group plc on approximately eight acres of land in Speke, UK. We intend
to utilize an existing 45,000 square foot structure on the property to
build a new FluMist(TM) manufacturing facility.
Clinical
-- On October 25, 2000, we announced the initiation of a Phase 2 clinical
trial of an investigational vaccine against Epstein-Barr virus (EBV)
infection, a cause of infectious mononucleosis, being developed under
our license with SmithKline Beecham Biologicals (SBB). The initiation
of this trial triggered a $1.5 million payment from SBB to Aviron.
Pursuant to an agreement with ARCH Development, we paid 25 percent of
this milestone to ARCH Development.
Financing Transactions
-- In five separate private equity financing transactions from
October 3, 2000 through January 26, 2001, we sold a total of
773,367 shares of our common stock to Acqua Wellington North American
Equities Fund, Ltd. (Acqua Wellington) at an average price of
$51.72 per share for aggregate proceeds of $40.0 million ($32.0 million
in the fourth quarter of 2000 and $8.0 million in January 2001). The
financing
transaction completed in January 2001 was the final transaction under
an $84 million commitment Acqua Wellington made to Aviron.
-- On October 12, 2000, we sold 450,000 shares of our common stock in a
private equity transaction to Biotech Target S.A. for total proceeds of
$21.6 million, or $48.00 per share.
-- On January 8, 2001, we announced a $10.0 million advance payment to
Aviron from AHP to support commercial manufacturing and inventory
build-up of FluMist(TM) for a potential product launch during the
2001-2002 influenza season. This payment is an advance for payments AHP
owes Aviron under the companies' global collaboration agreement for
FluMist(TM).
-- On January 12, 2001, we announced the commencement of public offerings
of 3,000,000 shares of common stock and $150.0 million aggregate
principal amount of convertible subordinated notes, in each case
subject to customary underwriters overallotment options.
Senior Leadership
-- On January 8, 2001, we announced that president and chief executive
officer C. Boyd Clarke was elected chairman of the board of directors.
He succeeds J. Leighton Read, M.D., Aviron's founder, who remains on
Aviron's board of directors.
-- On January 24, 2001, we announced the promotion of Rayasam S. Prasad to
senior vice president, technical affairs.
Aviron is a biopharmaceutical company based in Mountain View, California,
focused on the prevention of disease through innovative vaccine technology.
Actual results may differ materially from the forward-looking statements
contained in this release. Factors that could cause actual results to differ
include, but are not limited to, the assessment by regulatory agencies that
the company's license applications for its nasal influenza vaccine are
incomplete or inadequate to approve the product for marketing to one or more
target populations. Additional information concerning factors that could cause
such a difference is contained in Aviron's SEC filings, including, without
limitation, the company's Form 10-K, Forms 10-Q and Forms 8-K, which identify
specific factors that may cause actual results or events to differ materially
from those described in the forward looking statements.
To receive an index and copies of recent press releases, call Aviron's
News-On-Call toll-free fax service, 800-758-5804, extension 114000. Additional
information about the company can be located at http://www.aviron.com .
AVIRON
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except per share data)
Three Months Ended Year Ended
December 31, December 31,
2000 1999 2000 1999
Revenues:
Contract revenues and
grants $22,089 $2,394 $32,242 $22,232
Operating Expenses:
Research and development 26,485 20,252 80,521 68,212
Acquisition of in-process
research and development -- -- 10,904 --
General, administrative
and marketing 4,525 3,724 13,849 13,159
Total Operating Expenses 31,010 23,976 105,274 81,371
Loss From Operations (8,921) (21,582) (73,032) (59,139)
Other Income/(Expense):
Interest income 2,190 556 6,541 3,633
Interest expense (4,843) (1,587) (11,020) (6,364)
Total Other Income/
(Expense), net (2,653) (1,031) (4,479) (2,731)
Net Loss, before cumulative
effect of change in
accounting principle (11,574) (22,613) (77,511) (61,870)
Cumulative effect of change
in accounting principle -- -- (12,750) --
Net Loss, after cumulative
effect of change in
accounting principle $(11,574) $(22,613) $(90,261) $(61,870)
Basic and diluted net
loss per share:
Loss before cumulative
effect of change in
accounting principle $(0.50) $(1.40) $(3.74) $(3.90)
Cumulative effect of
change in accounting
principle -- -- $(0.62) --
Loss after cumulative
effect of change in
accounting principle $(0.50) $(1.40) $(4.36) $(3.90)
Shares used in calculation
of basic net loss per share 23,100 16,126 20,715 15,848
AVIRON
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
December 31, December 31,
2000 1999
ASSETS
Cash and cash equivalents
and short-term investments $132,313 $52,316
Accounts receivable 23,288 3,241
Inventory 4,264 2,082
Other current assets 2,691 1,009
Total Current Assets 162,556 58,648
Long-term investments 4,506 --
Property and equipment, net 27,707 25,635
Intangible assets 48,693 --
Debt issuance costs, deposits
and other assets 5,277 7,411
Total Assets $248,739 $91,694
LIABILITIES and STOCKHOLDERS'
EQUITY (DEFICIT)
Current liabilities $26,361 $16,433
Obligations to Evans, less current
portion 31,531 --
Long-term debt, less current portion 58,416 112,657
Other long-term liabilities 11,845 2,223
Total Liabilities 128,153 131,313
Stockholders' Equity (Deficit) 120,586 (39,619)
Total Liabilities and
Stockholders' Equity (Deficit) $248,739 $91,694
SOURCE Aviron
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http://www.aviron.com
Company News On-Call:
http://www.prnewswire.com/comp/114000.html or fax,
800-758-5804, ext. 114000
CONTACT:
investors, Fred Kurland, 650-919-6666, or
media, John Bluth, 650-919-3716, or Asha Jennings, 650-919-1429,
all of Aviron; or Camela Stuby of Fleishman-Hillard,
212-453-2000, for Aviron
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