MOUNTAIN VIEW, Calif., April 25 /PRNewswire/ -- Aviron (Nasdaq: AVIR)
today announced results for the first quarter, ended March 31, 2001.
The company reported a net loss of $27.5 million (basic net loss of
$0.96 per share) for the first quarter of 2001, compared to a net loss of
$41.8 million (basic net loss of $2.44 per share) for the first quarter of
2000. The results for the first quarter of 2000 reflect the implementation of
Staff Accounting Bulletin No. 101, Revenue Recognition in Financial Statements
(SAB 101), as of January 1, 2000.
Revenues in the 2001 first quarter totaled $3.2 million, compared to
$3.4 million for the first quarter of 2000. Revenues during the first quarters
of 2000 and 2001 were comprised principally of revenue from Wyeth Lederle
Vaccines (Wyeth), a business unit of American Home Products Corporation (AHP),
related to the clinical development and commercialization of FluMist(TM),
under the terms of our FluMist(TM) collaboration agreement. FluMist(TM) is
Aviron's investigational intranasal influenza vaccine.
Operating expenses in the 2001 first quarter totaled $32.6 million,
compared to $31.1 million for the first quarter of 2000. Research and
development costs increased to $28.1 million in the 2001 first quarter from
$17.6 million in the first quarter of 2000. 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).
The first quarter of 2000 also included a one-time, non-cash charge for the
acquisition of in-process research and development in the amount of
$10.9 million due to the February 2000 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 2001 first quarter from $2.6 million in the 2000
first quarter. The increase was due to significant growth in infrastructure
and other costs to support preparations for a potential commercial launch of
FluMist(TM) in 2001.
During the first quarter of 2001, we exchanged approximately $33.5 million
aggregate principal amount of our 5 3/4 percent convertible notes due in 2005
for approximately 1.1 million shares of our common stock in a number of
privately negotiated transactions. Additional non-cash interest expense
related to these exchanges was approximately $1.6 million. Approximately
$800,000 of unamortized debt issue costs related to the 2005 notes exchanged
have been charged to additional paid-in capital in the first quarter of 2001.
As of March 31, 2001, approximately $14.8 million aggregate principal amount
of the 2005 notes remained outstanding.
Cash, cash equivalents and investments totaled $523.5 million at
March 31, 2001, compared to $136.8 million at December 31, 2000.
Company events during the first quarter included several financings,
commercialization related activities and personnel announcements.
Financing transactions
-- On January 29, we sold 161,060 shares of our common stock to Acqua
Wellington North American Equities Fund, Ltd. (Acqua Wellington) for an
aggregate price of $8.0 million, or $49.67 per share. This financing
was the final transaction under Acqua Wellington's $84.0 million equity
financing commitment.
-- On February 7, we completed a public offering of 4,000,000 shares of
our common stock at $50.00 per share and a concurrent public offering
of $200.0 million of 5 1/4 percent convertible subordinated notes due
in 2008. The 2008 notes are convertible into common stock at any time
after the original issuance through maturity, unless previously
redeemed or repurchased, at a conversion price of $62.50 per share. The
sale of the securities under the concurrent common stock and debt
offerings resulted in net proceeds to the company of approximately
$382.5 million, after the deduction of commissions and offering costs.
Operations
-- On January 8, we announced the receipt of a $10.0 million advance 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 was an advance for payments AHP will owe
Aviron under the companies' global collaboration agreement for
FluMist(TM).
Senior Management
-- On January 8, we announced the election of C. Boyd Clarke, Aviron
president and chief executive officer, as chairman of the board of
directors.
-- On January 24, we announced the promotion of Rayasam S. Prasad to
senior vice president, technical affairs.
Business Outlook
We anticipate our operating expenditures will be between $130 and
$145 million in 2001. This increase from 2000 operating expenses is due
primarily to an increase in the size of our operations in the U.K. and
expenses that we expect to incur as we make preparations for a potential
commercial launch of FluMist(TM) in the U.S. for the 2001-2002 influenza
season. This increase includes amortization expense associated with the
restructuring of our manufacturing agreement with Evans Vaccines Ltd. The
portion of 2001 operating expenses that is depreciation and amortization is
expected to be approximately $17.0 million, compared to $8.1 million for 2000.
Our outlook for operating expenses in 2001 does not include a one-time
non-cash charge associated with the vesting of employee stock options in the
event of a 2001 approval by the FDA for marketing of FluMist(TM).
As part of preparing for a potential FluMist(TM) commercial launch for the
2001-2002 influenza season, we have begun the initial stages of
commercial-scale manufacturing of FluMist(TM). Since the outcome and timing of
the regulatory process will strongly influence the number of doses sold during
the 2001-2002 influenza season, we have not made sales projections for 2001.
FluMist(TM) sales projections for 2002 will depend upon the outcome and
timing of regulatory approval, the labeled indications, the scope of any
expanded recommendations for influenza vaccination by important medical
organizations, the number of doses manufactured, the number of doses released
for sale by the FDA and the ex-manufacture price. Our goal is to generate
sufficient revenue to Aviron from FluMist(TM) sales during 2002 to achieve
profitability.
We intend to record the majority of our manufacturing spending as research
and development expense, rather than capitalize into inventory, until
FluMist(TM) is approved for marketing by the FDA. Thus, a significant portion
of anticipated 2001 operating expense will include manufacturing activities.
If we receive marketing approval for FluMist(TM), initial reported cost of
goods sold may be lower than in future periods when manufacturing expenses
will be charged to cost of goods sold.
We expect capital expenditures to increase substantially as we commence
building additional manufacturing facilities and commercialization systems and
facilities. During 2001, we forecast that capital expenditures will be between
$30.0 and $40.0 million.
In conjunction with this press release, Aviron will host a conference call
that will be broadcast live over the Internet. The conference call will take
place on Thursday, April 26, beginning at 8:30 a.m. EDT. To access the
webcast, visit the Aviron Web site at http://www.aviron.com and log-on to the
audio feed as instructed. If you are unable to participate during the live
webcast, the call will be archived at http://www.aviron.com until
5:00 p.m. EDT on Monday, April 30. The information provided on the conference
call and on the webcast is only accurate at the time of the call, and Aviron
will take no responsibility for providing updated information.
Aviron is a biopharmaceutical company based in Mountain View, California,
focused on the prevention of disease through innovative vaccine technology.
The business outlook and other sections of this press release contain
forward-looking statements. These statements, which reflect management's
current beliefs and expectations, are subject to risks and uncertainties that
may cause actual results to differ materially from those projected in 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 our license applications for our nasal influenza
vaccine, or other vaccines, are incomplete or inadequate to approve the
product for marketing to one or more target populations, and those factors
listed in the business outlook section of the release.
Additional factors that could cause actual results to differ include,
without limitation, the risk that the FDA will determine that our
manufacturing facilities are not adequate, potential difficulties we may have
with our manufacturing process, the risk that we are unable to perform the
complex annual update of the FluMist(TM) formulation for new influenza strains
in a timely manner, our dependence on Wyeth for marketing, promotion, sales
and distribution activities, the risk that medical advisory bodies, doctors
and other health care providers do not recommend FluMist(TM), the risk that
the market does not accept FluMist(TM), and other business risks identified in
our Annual Report on Form 10-K for the fiscal year ended December 31, 2000.
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
March 31,
2001 2000
Revenues:
Contract revenues and grants $3,215 $3,407
Operating Expenses:
Research and development 28,094 17,594
Acquisition of in-process research
and development -- 10,904
General, administrative and marketing 4,473 2,568
Total Operating Expenses 32,567 31,066
Loss From Operations (29,352) (27,659)
Other Income/(Expense), net 1,886 (1,366)
Net Loss, before cumulative effect of
change in accounting principle (27,466) (29,025)
Cumulative effect of change in accounting
principle -- (12,750)
Net Loss, after cumulative effect of change
in accounting principle $(27,466) $(41,775)
Basic and diluted net loss per share:
Loss before cumulative effect of change
in accounting principle $(0.96) $(1.70)
Cumulative effect of change in accounting
principle -- (0.74)
Loss after cumulative effect of change in
accounting principle $(0.96) $(2.44)
Shares used in calculation of basic net
loss per share 28,504 17,095
AVIRON
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
March 31, December 31,
2001 2000
(Unaudited) (Note)
ASSETS
Cash and cash equivalents and short-term
investments $470,353 $132,313
Accounts receivable 6,553 23,288
Inventory 5,492 4,264
Other current assets 4,249 2,691
Total Current Assets 486,647 162,556
Long-term investments 53,163 4,506
Property and equipment, net 30,569 27,707
Intangible assets 47,698 48,046
Debt issuance costs, deposits and other
assets 11,493 5,924
Total Assets $629,570 $248,739
LIABILITIES and STOCKHOLDERS' EQUITY
Current liabilities $31,854 $26,361
Long-term obligations, less current portion 257,426 89,947
Other long-term liabilities 10,628 11,845
Total Liabilities 299,908 128,153
Stockholders' Equity 329,662 120,586
Total Liabilities and
Stockholders' Equity $629,570 $248,739
Note: These amounts have been derived from the audited consolidated
financial statements.
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 Ben Butkus of Fleishman-Hillard, 212-453-2000,
for Aviron
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