MOUNTAIN VIEW, Calif., April 27 /PRNewswire/ -- The following is being
issued by Aviron:
Aviron (Nasdaq: AVIR) today announced results for the 2000 first quarter,
ended March 31, 2000.
For the first quarter, the company reported a net loss of $29.8 million
(basic net loss of $1.74 per share), compared to a loss of $1.5 million (basic
net loss per share of $0.10 per share) for the first quarter of 1999. The
increase in net loss was due primarily to the inclusion in the first quarter
of 1999 of a non-refundable, up-front license fee of $15.0 million from Wyeth
Lederle Vaccines (Wyeth), a business unit of American Home Products
Corporation (AHP), inclusion in the first quarter of 2000 of a one-time,
non-cash $10.9 million charge related to issuance of a warrant for the
acquisition of in-process research and development, and increases in operating
expenses in preparation for the potential commercialization of FluMist(TM), an
investigational intranasal influenza vaccine.
Revenues in the 2000 first quarter totaled $2.7 million, compared to
$15.5 million for the first quarter of 1999. First quarter 2000 revenues were
comprised principally of expense reimbursement from Wyeth, under the
FluMist(TM) collaboration agreement. Revenues during the first quarter of
1999 were comprised principally of the $15.0 million payment from Wyeth.
Aviron and Wyeth are collaborating on the development and marketing of
FluMist(TM).
Operating expenses in the 2000 first quarter totaled $31.1 million,
compared to $16.7 million for the first quarter of 1999. Research and
development costs rose to $17.6 million in the 2000 first quarter from
$14.0 million in the first quarter of 1999. The increase in research and
development costs was due primarily to increases in development activities,
documentation, validation and other expenses associated with the commercial
scale-up associated with FluMist(TM). These increases were partially offset by
reductions in spending on clinical trials. 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 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 fell
slightly to $2.6 million in the 2000 first quarter from $2.7 million in the
first quarter of 1999, due to a modest decrease in infrastructure and support
activities.
Cash, cash equivalents and investments totaled $53.0 million at
March 31, 2000, compared to $52.3 million at December 31, 1999. Cash needs to
meet operating and capital expenditures during the first quarter of 2000 were
offset by the receipt of net proceeds of $18.0 million from financing
transactions described below.
In December 1999, the Securities and Exchange Commission (SEC) issued
Staff Accounting Bulletin No. 101, Revenue Recognition in Financial Statements
(SAB 101), which includes the SEC staff's view on accounting for
non-refundable up-front fees received in connection with collaboration
agreements. We have determined that a change in accounting policy is
necessary for the $15.0 million up-front license fee received from Wyeth,
recognized as revenue in the first quarter of 1999. However, we are currently
evaluating the period over which the license fee should be recognized as
revenue. We will make this change in our accounting policy in the second
quarter of 2000, which will result in a charge to operations for the
cumulative effect of the change as of January 1, 2000. This amount will be
recorded as deferred revenue and recognized as revenue in future periods.
Prior financial statements will not be restated.
Company events during the first quarter and early second quarter included
several financings and personnel announcements and an update on our timetable
for submission of a Biologics License Application (BLA) for FluMist(TM):
Financing transactions
-- On January 12, we announced that we had received a 12 month commitment
for up to $48.0 million in equity financing from Acqua Wellington North
American Equities Fund, Ltd. (Acqua Wellington). These funds are
available, at Aviron's discretion, at a small discount to the market.
-- On February 3, we announced that we had sold 309,995 shares of our
common stock to Ridgeway Investment, Ltd., for an aggregate price of
$6.0 million, or $19.36 per share. In a separate private transaction,
pursuant to our previously executed collaboration agreement, we sold
103,332 shares of our common stock to AHP for an aggregate price of
$2.0 million, or $19.36 per share.
-- On March 6, we reported that we had sold 253,935 shares of our common
stock to Acqua Wellington for an aggregate price of $8.0 million, or
$31.50 per share and 121,212 shares of our common stock to AHP at a
price of $16.50 per share for total proceeds of $2.0 million, pursuant
to a December 30, 1999 agreement with AHP.
-- On March 8, we announced that we had filed a Registration Statement
with the SEC with respect to a public offering of common stock. On
April 6, we announced that the public offering of 2,000,000 shares had
been priced at $22.50 per share and that the underwriters had fully
exercised their option to purchase 300,000 additional shares
(100,000 from a selling stockholder and 200,000 from the company) to
cover over-allotments. Concurrent with this public offering, AHP
purchased 686,160 shares of our common stock at $21.38 per share, the
price equal to the net proceeds per share to the company in the public
offering. Aggregate net proceeds to the company from both the public
offering and the AHP transaction, after expenses and underwriters'
discounts and commissions, were approximately $60.7 million. The public
offering closed on April 10, 2000.
-- On April 13, we announced that we had sold 144,185 shares of our common
stock to Acqua Wellington for an aggregate price of $4.0 million, or
$27.74 per share.
Other events
-- In February 2000, we amended our agreement with the University of
Michigan to accelerate the issuance of a warrant to the university. As
a result of this amendment, we granted the university a warrant to
purchase 340,000 shares of our common stock at an exercise price of
$10.00 per share. As noted above, we recorded a one-time (non-cash)
charge of approximately $10.9 million in the first quarter of 2000 in
connection with the issuance of this warrant. Upon the date of the
first commercial sale of FluMist(TM), if 1.25 percent of our common
stock then outstanding exceeds 340,000 shares, we will issue an
additional warrant on the same terms allowing the university to
purchase a number of shares equal to the difference between 340,000 and
1.25 percent.
-- On March 6, we announced that Dennis M. Fenton, Ph.D., Executive Vice
President of Amgen, and Wayne T. Hockmeyer, Ph.D., Chairman and Chief
Executive Officer of MedImmune, Inc. had been appointed to our Board of
Directors. Their appointments increased the size of Aviron's board to
eight.
-- On March 7, we announced that we had completed investigations into
inconsistent test results observed last fall during process validation
exercises and plan to submit our BLA for FluMist(TM) to the U.S. Food
and Drug Administration (FDA) during the fourth quarter of 2000. Our
investigations concluded that the inconsistencies were associated with
certain assays, or tests, and not associated with FluMist(TM) or the
manufacturing process. We also noted that we believe our contract
manufacturer, Celltech Medeva (Medeva), the international marketing arm
of the Celltech Group, plc, has taken the necessary steps to bring
relevant general utility systems into compliance. We have also begun
to implement plans to eliminate our dependence on these utilities.
Those plans involve the use of disposable supplies instead of relying
on the shared utility systems at Medeva.
-- On March 7, we announced that Wyeth, in conjunction with us, had
initiated a Phase 2 bridging study with a refrigerator-stable liquid
formulation of FluMist(TM) in the southern hemisphere. This trial is
intended to demonstrate clinical equivalence between the frozen and
liquid formulations of FluMist(TM). The trial of more than
1,300 children aged one to three years was fully enrolled in less than
two months.
-- On April 14, we announced that Charlene Friedman had been appointed
Vice President and General Counsel.
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, failure to validate the manufacturing
process, facilities or equipment for the company's nasal influenza vaccine,
and the assessment by regulatory agencies that the company's future 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 its Annual Report on Form 10-K
for the year ended December 31, 1999.
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,
2000 1999
Revenues:
Contract revenues and research grants $2,657 $15,531
Operating Expenses:
Research and development 17,594 14,005
Acquisition of in-process
research and development 10,904 --
General, administrative and marketing 2,568 2,682
Total Operating Expenses 31,066 16,687
Loss From Operations (28,409) (1,156)
Other Income/(Expense):
Interest income 722 1,211
Interest expense (2,088) (1,574)
Total Other Income/(Expense), Net (1,366) (363)
Net Loss $(29,775) $(1,519)
Basic net loss per share $(1.74) $(0.10)
Shares used in calculation
of basic net loss per share 17,095 15,703
AVIRON
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
ASSETS
March 31, December 31,
2000 1999
(Unaudited) (Note)
ASSETS
Cash and cash equivalents
and short-term investments $52,989 $52,316
Accounts receivable 1,701 3,241
Inventory 2,082 2,082
Other current assets 1,661 1,009
Total Current Assets 58,433 58,648
Property and equipment, net 24,796 25,635
Debt issuance costs,
deposits and other assets 6,999 7,411
Total Assets $90,228 $91,694
LIABILITIES and STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities 14,756 16,433
Long-term debt 111,935 112,657
Other long-term liabilities 1,769 2,223
Total Liabilities 128,460 131,313
Stockholders' Equity Deficit (38,232) (39,619)
Total Liabilities and Stockholders'
Equity Deficit $90,228 $91,694
Note: These amounts have been derived from audited financial statements.
SOURCE Aviron
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Related links:
http://www.aviron.com
Company News On-Call:
http://www.prnewswire.com/comp/114000.html or fax,
800-758-5804, ext. 114000
CONTACT:
media & investors, John Bluth, 650-919-3716,
or investors, Fred Kurland, 650-919-6666, both of Aviron; or
media, Claudette Hibbert of Fleishman-Hillard, 212-453-2000, for
Aviron
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