-- Revenues increased 187% in first quarter 2006 compared to the same
period in 2005
-- Cash and equivalents increased 51% from year end 2005 to euro 144.1
million as of March 31, 2006
MARTINSRIED/MUNICH, Germany, May 4 /PRNewswire-FirstCall/ -- Waltham,
Mass. and Princeton, N.J. -- GPC Biotech AG (Frankfurt Stock Exchange: GPC;
TecDAX index; Nasdaq: GPCB) today reported financial results for the first
quarter ended March 31, 2006.
Quarter over quarter results: first quarter 2006 compared to fourth
quarter 2005
Revenues for the first quarter of 2006 increased 90% to euro 5.4
million compared to euro 2.8 million for the previous quarter. Research and
development (R&D) expenses decreased 7% to euro 14.5 million for the first
quarter of 2006 compared to euro 15.6 million for the fourth quarter of
2005. General and administrative (G&A) expenses for the first quarter of
2006 decreased 20% to euro 4.4 million compared to euro 5.5 million for the
previous quarter. The Company's net loss decreased 25% to euro (12.9)
million in the first quarter of 2006, compared to euro (17.2) million for
the previous quarter. Basic and diluted loss per share was euro (0.41) for
the first quarter of 2006 compared to euro (0.57) for the previous quarter.
Comparison to previous year: first quarter 2006 compared to first
quarter 2005
Revenues for the three months ended March 31, 2006 increased 187% to
euro 5.4 million compared to euro 1.9 million for the same period in 2005.
The increase in revenues is due to the co-development and license agreement
for satraplatin for Europe and certain other territories with Pharmion that
was signed in December 2005. R&D expenses increased 30% for the first
quarter of 2006 to euro 14.5 million compared to euro 11.2 million for the
same period in 2005. The increase was mainly due to activities related to
the satraplatin SPARC Phase 3 registrational trial. G&A expenses for the
first quarter of 2006 increased 11% to euro 4.4 million compared to euro
3.9 million for the same quarter in 2005. Net loss for the first quarter of
2006 increased 4% to euro (12.9) million compared to euro (12.4) million
for the first quarter of 2005. Basic and diluted loss per share was euro
(0.41) for the first quarter of 2006 compared to euro (0.42) for the same
period in 2005.
As of March 31, 2006, cash, cash equivalents, marketable securities and
short-term investments totaled euro 144.1 million (December 31, 2005: euro
95.2 million), including euro 1.6 million in restricted cash. Net cash
generated by operating activities was euro 12.8 million, and purchases of
property, equipment and licenses were euro 0.3 million for the first
quarter of 2006.
"Our revenues almost tripled compared to the same quarter in 2005 due
to our co-development and license agreement with Pharmion," said Mirko
Scherer, Ph.D., Senior Vice President and Chief Financial Officer. "This is
the first quarter that the majority of our revenues are a result of our
drug development programs and not from technology collaborations."
"In the first months of 2006, we have continued to build on the good
progress made during 2005," said Bernd R. Seizinger, M.D., Ph.D., Chief
Executive Officer. "Importantly, the interim efficacy analysis for the
satraplatin Phase 3 trial has now been held by the independent Data
Monitoring Board, and the recommendation, as we had expected, was that the
trial continue as planned, based on their finding that both the design and
conduct of the trial remain sound, no new or unexpected toxicities were
observed, and the futility analysis was passed. We thus look forward to
reporting the final progression-free survival results this fall."
Dr. Seizinger continued, "In the meantime, much activity is happening
at GPC Biotech as the SPARC registrational trial completes. We have
initiated new clinical trials with satraplatin in combination with other
anticancer treatments and in a variety of cancer settings. We have also
recently expanded our drug development and commercialization management
teams with the hiring of three senior executives to fill newly-created
positions at the Company. In another step in the planning for our future,
we also were able to complete a private placement of euro 36 million
involving prominent SAP co- founder Dietmar Hopp. The first few months of
2006 have been exciting, and we look forward to continuing our productive
year as we move our programs forward."
Highlights for 2006 year to date
-- Independent Data Monitoring Board recommends that GPC Biotech continue
satraplatin Phase 3 trial as planned. Data Monitoring Board reports
design and conduct of trial remain sound and SPARC trial passes
futility analysis
-- Company hires three senior executives to fill newly-created positions
to expand drug development and commercialization management teams
-- Private placement with two investment companies owned by SAP co-founder
Dietmar Hopp and his son, respectively, raising euro 36.2 million
-- New clinical trial opened with satraplatin:
-- Phase 1 trial evaluating satraplatin plus Taxotere(R) (docetaxel) in
patients with advanced solid tumors; trial is evaluating a different
dosing schedule with Taxotere compared to trial started in mid-2005
-- Presentation of new clinical and pre-clinical data on satraplatin,
supportive of the clinical work the Company has underway to explore the
potential of satraplatin in a variety of combination therapies and
cancer settings
-- Granting of orphan drug designation for 1D09C3 by European Commission
for chronic lymphocytic leukemia and multiple myeloma
Conference call scheduled
As previously announced, the Company has scheduled a conference call to
which participants may listen via live webcast, accessible through the GPC
Biotech Web site at http://www.gpc-biotech.com or via telephone. A replay
will be available via the Web site following the live event. The call,
which will be conducted in English, will be held on Thursday, May 4, 2006
at 14:30 CET/8:30 AM EDT. The dial-in numbers for the call are as follows:
European participants: 0049 (0)69 500 71846
U.S. participants: 1-866-770-7146 (toll-free)
GPC Biotech AG is a biopharmaceutical company discovering and
developing new anticancer drugs. The Company's lead product candidate --
satraplatin -- has achieved target enrollment in a Phase 3 registrational
trial as a second-line chemotherapy treatment in hormone-refractory
prostate cancer. The U.S. FDA has granted fast track designation to
satraplatin for this indication, and GPC Biotech has begun the rolling NDA
submission process for this compound. GPC Biotech is also developing a
monoclonal antibody with a novel mechanism-of-action against a variety of
lymphoid tumors, currently in Phase 1 clinical development, and has ongoing
drug development and discovery programs that leverage its expertise in
kinase inhibitors. GPC Biotech AG is headquartered in Martinsried/Munich
(Germany). The Company's wholly owned U.S. subsidiary has sites in Waltham,
Massachusetts and Princeton, New Jersey. For additional information, please
visit the Company's Web site at http://www.gpc-biotech.com.
This press release may contain forward-looking statements. Forward-
looking statements may be, but are not necessarily, identified by words
like "believe", "anticipate", "intend", "expect", "target", "goal",
"estimate", "plan", "assume", "may", "will", "could" and similar
expressions. Forward-looking statements include, but are not limited to,
statements about the progress, timing and completion of research,
development, pre-clinical studies and clinical trials for the Company's
product candidates; the timing and ultimate success in obtaining regulatory
approval in the U.S., Europe or any other jurisdiction for satraplatin or
any other product candidates; the Company's ability to market,
commercialize, achieve market acceptance for and sell the Company's product
candidates; the Company's ability to adequately protect its intellectual
property and operate its business without infringing upon the intellectual
property rights of others; and the Company's estimates regarding
anticipated operating losses, future revenues, capital requirements and
needs for additional financing. Forward-looking statements in this press
release are based on the Company's current expectations and projections
about future events and are subject to risks, uncertainties and
assumptions. In light of these risks, uncertainties and assumptions, the
forward-looking events discussed in this press release might not occur. We
direct you to the Company's Form 20-F for the fiscal year ended December
31, 2005 and other reports filed with the U.S. Securities and Exchange
Commission (SEC) for additional details on the important factors that may
affect the Company's future results, performance and achievements. Except
as required by law, the Company disclaims any intent or obligation to
publicly update or revise these forward-looking statements whether as a
result of new information, future events or otherwise. You are advised,
however, to consult any additional disclosure the Company makes on its
current reports on Form 6-K to the SEC.
Taxotere(R) (docetaxel) is a registered trademark of Aventis Pharma S.A.
For further information, please contact:
GPC Biotech AG
Fraunhoferstr. 20
82152 Martinsried/Munich, Germany
Martin Braendle
Associate Director, Investor Relations & Corporate Communications
Phone: +49 (0)89 8565-2693
ir@gpc-biotech.com
In the U.S.:
Laurie Doyle
Associate Director, Investor Relations & Corporate Communications
Phone: +1 781 890 9007 X267
usinvestors@gpc-biotech.com
Additional Media Contacts:
In Europe:
Maitland Noonan Russo
Brian Hudspith
Phone: +44 (0)20 7379 5151
bhudspith@maitland.co.uk
In the U.S.:
Noonan Russo
Matt Haines
Phone: +1 212 845 4235
matthew.haines@eurorscg.com
- Financials follow -
Condensed Consolidated Statements of Operations (U.S. GAAP)
Three months ended March 31,
in thousand euros, except share and
per share data 2006 (unaudited) 2005 (unaudited)
Collaborative revenues (a) 5,398 1,880
Total revenues 5,398 1,880
Research and development expenses 14,519 11,196
General and administrative expenses 4,377 3,945
In process research and development - 570
Amortization of intangible assets 72 99
Total operating expenses 18,968 15,810
Operating loss (13,570) (13,930)
Other income (expense), net (674) 776
Interest income 951 776
Interest expense (22) (23)
Net loss before Cumulative effect of
change in accounting principle (13,315) (12,401)
Cumulative effect of change in
accounting principle 433 -
Net loss (12,882) (12,401)
Loss per share before change in
accounting principle (0.43) (0.42)
Cumulative effect of change in
accounting principle 0.02 -
Basic and diluted loss per share, in euro (0.41) (0.42)
Shares used in computing basic and
diluted loss per share 31,317,316 29,187,304
(a) Revenues from related party
Collaborative revenues 1,474 1,824
See accompanying notes to unaudited condensed consolidated financial
statements.
Condensed Consolidated Balance Sheets (U.S. GAAP)
in thousand euro, except share data and per share data
Assets March 31, December 31,
2006 (unaudited) 2005
Current assets
Cash and cash equivalents 79,465 30,559
Marketable securities and short-term
investments 63,074 63,061
Accounts receivable - 31,326
Accounts receivable, related party - 1,436
Prepaid expenses 1,573 1,333
Other current assets 5,009 3,920
Total current assets 149,121 131,635
Property and equipment, net 3,952 4,103
Intangible assets, net 689 1,072
Other assets, non-current 1,252 838
Restricted cash 1,602 1,615
Total assets 156,616 139,263
Liabilities and shareholders' equity
Current liabilities
Accounts payable 348 2,141
Accrued expenses and other current
liabilities 10,281 11,274
Current portion of deferred revenue,
related party 4,512 5,228
Current portion of deferred revenue 15,977 19,548
Total current liabilities 31,118 38,191
Deferred revenues, related party, net of
current portion 488 975
Deferred revenue, net of current portion 12,210 12,053
Convertible bonds 2,454 2,334
Other liabilities, non-current 2,036 2,177
Shareholders' equity
Ordinary shares, euro 1 non-par, notional value;
Shares authorized: 53,780,630 at March 31, 2006
and December 31, 2005
Shares issued and outstanding: 33,089,233
at March 31, 2006 and 30,151,757 at
December 31, 2005 33,089 30,152
Additional paid-in capital 319,646 284,931
Accumulated other comprehensive loss (2,086) (2,093)
Accumulated deficit (242,339) (229,457)
Total shareholders' equity 108,310 83,533
Total liabilities and shareholders' equity 156,616 139,263
See accompanying notes to unaudited condensed consolidated financial
statements.
Condensed Consolidated Statements of Cash Flows (U.S. GAAP)
Three months ended March 31,
in thousand euros 2006 (unaudited) 2005 (unaudited)
Cash flows from operating activities
Net loss (12,882) (12,401)
Adjustments to reconcile net loss to
net cash provided by / (used in)
operating activities :
Depreciation 434 662
Amortization 71 50
Compensation cost for stock option
plans and convertible bonds 1,560 1,790
Acquired in-process research and development - 570
Cumulative effect of change in accounting
principle (433) -
Change in accrued interest income on
marketable securities and short-term
investments (82) 371
Bond premium amortization 199 139
(Gain)/loss on disposal of property and
equipment (28) (22)
Changes in operating assets and liabilities:
Accounts receivable, related party 1,436 1,006
Accounts receivable 31,325 -
Other assets, current and non-current (1,425) 767
Accounts payable (1,774) (371)
Deferred revenue, related party (1,203) (1,231)
Deferred revenue (3,414) 444
Other liabilities and accrued expenses (974) 60
Net cash provided by / (used in) operating
activities 12,810 (8,166)
Cash flows from investing activities
Purchases of property, equipment and
licenses (327) (2,554)
Proceeds from the sale of property and
equipment - 27
Proceeds from sale of marketable securities
and short-term investments - (5,001)
Net cash used in investing activities (327) (7,528)
Cash flows from financing activities
Proceeds from issuance of shares in asset
acquisition, net of payments
for costs of transaction 36,080 -
Proceeds from issuance of shares in asset
aquisition, net of payments for costs of
transaction - 10,705
Proceeds from issuance of convertible bonds 140 -
Proceeds from exercise of stock options and
convertible bonds 426 178
Net cash provided by financing activities 36,646 10,883
Effect of exchange rate changes on cash (209) 621
Changes in Restricted cash (14) (149)
Net increase/(decrease) in cash and cash
equivalents 48,906 (4,339)
Cash and cash equivalents at the beginning
of the period 30,559 59,421
Cash and cash equivalents at the end of
the period 79,465 55,082
Supplemental Information:
Cash paid for interest - 40
See accompanying notes to unaudited condensed consolidated financial
statements.
Condensed Consolidated Statements of
Changes in Shareholders' Equity (U.S. GAAP)
Ordinary shares Additional Paid-
in thousand euros, except Shares Amount in Capital
share data
Balance as of December 31, 2004 28,741,194 28,741 266,074
Components of comprehensive loss:
Net loss
Change in unrealized gain on
available-for-sale securities
Accumulated translation
adjustments
Total comprehensive loss
Issuance of shares in equity
offering 1,311,098 1,311 11,538
Exercise of stock options and
convertible bonds 23,360 24 154
Compensation costs, stock
options and convertible bonds 1,790
Balance as of March 31, 2005
(unaudited) 30,075,652 30,076 279,556
Balance as of December 31, 2005 30,151,757 30,152 284,931
Components of comprehensive loss:
Net loss
Change in unrealized gain on
available-for-sale securities
Accumulated translation
adjustments
Total comprehensive loss
Issuance of shares 2,860,000 2,860 33,220
Exercise of stock options and
convertible bonds 77,476 77 368
Cumulative effect of change
in accounting principle (433)
Compensation costs, stock
options and convertible bonds 1,560
Balance as of March 31, 2006
(unaudited) 33,089,233 33,089 319,646
Condensed Consolidated Statements of
Changes in Shareholders' Equity (U.S. GAAP)
Accumulated
Other Total
Comprehensive Accumulated Shareholders'
Loss Deficit Equity
in thousand euros, except
share data
Balance as of December 31, 2004 (2,732) (167,250) 124,833
Components of comprehensive
loss:
Net loss (12,401) (12,401)
Change in unrealized gain on
available-for-sale securities (103) (103)
Accumulated translation
adjustments 724 724
Total comprehensive loss (11,780)
Issuance of shares in equity
offering 12,849
Exercise of stock options and
convertible bonds 178
Compensation costs, stock
options and convertible bonds 1,790
Balance as of March 31, 2005
(unaudited) (2,111) (179,651) 127,870
Balance as of December 31, 2005 (2,093) (229,457) 83,533
Components of comprehensive loss:
Net loss (12,882) (12,882)
Change in unrealized gain on
available-for-sale securities 130 130
Accumulated translation
adjustments (123) (123)
Total comprehensive loss (12,875)
Issuance of shares 36,080
Exercise of stock options and
convertible bonds 445
Cumulative effect of change
in accounting principle (433)
Compensation costs, stock
options and convertible bonds 1,560
Balance as of March 31, 2006
(unaudited) (2,086) (242,339) 108,310
See accompanying notes to unaudited condensed consolidated financial
statements.
GPC Biotech AG
Notes to the Unaudited Condensed Consolidated Financial Statements
1. Basis of Presentation
The accompanying unaudited condensed consolidated financial statements
of GPC Biotech AG (the "Company") have been prepared in accordance with
accounting principles generally accepted in the United States ("U.S.
GAAP"), except that they do not include all of the information and
footnotes required by U.S. GAAP for complete financial statements. In the
opinion of management, all adjustments (consisting of normal recurring
adjustments) considered necessary for a fair presentation have been
included. Operating results for the three-month period ended March 31, 2006
are not necessarily indicative of results to be expected for the full year
ending December 31, 2006. The balance sheet at December 31, 2005 has been
derived from the audited consolidated financial statements at that date,
but does not include all of the information required by U.S. GAAP for
complete financial statements. For further information, refer to the
consolidated financial statements and footnotes thereto for the year ended
December 31, 2005.
Certain prior period amounts in the statement of operations and
statement of cash flows have been reclassified to conform to current period
presentation. The Company has reclassified investments in money market
funds from marketable securities and short-term investments to cash and
cash equivalents in prior periods. Accordingly, the Company has revised the
classification to exclude euro 31.4 million from marketable securities and
short-term investments at March 31, 2005 and to include such amount under
cash and cash equivalents. In addition, the Company has reclassified the
purchase and sale of these investments in money market funds and their
foreign currency effects in its consolidated statements of cash flows,
which decreased cash used in investing activities by euro 30.4 million and
decreased cash used in operations by euro 0.9 million for the three months
ended March 31, 2005. The reclassifications had no impact on the Company's
results of operations or its overall financial position.
2. Share-based Compensation
Prior to January 1, 2006 the Company accounted for stock options and
convertible bonds under the expense provisions of SFAS No. 123, "Accounting
for Stock-Based Compensation" ("SFAS 123"). As of January 1, 2006, the
Company adopted SFAS No. 123 (Revised 2004) "Share-Based Payment" ("SFAS
123R") using the modified-prospective-transition method. Under that
transition method, compensation cost recognized in 2006 includes: (a)
compensation costs for all share-based payments granted prior to, but not
yet vested as of January 1, 2006, based on the grant date fair value
estimated in accordance with the original provisions of SFAS 123, and (b)
compensation cost for all share-based payments granted subsequent to
January 1, 2006, based on the grant-date fair value estimated in accordance
with the provisions of SFAS 123R. Results for prior periods have not been
restated.
Prior to the adoption of SFAS 123R, the Company recorded all
forfeitures of share-based compensation in the statements of operations as
they occurred. Upon adoption of SFAS 123R, the Company estimated the
forfeitures of unvested share-based compensation at January 1, 2006, and
recorded a cumulative effect of change in accounting principle in the
statement of operations in the amount of euro 433,000.
The Company has three share-based compensation plans: stock option
plan, convertible bond plan and stock appreciation rights (SARs). These
plans have been described in the footnotes to the consolidated financial
statements for the year ended December 31, 2005. Compensation costs charged
to research and development and general and administrative expense for the
three-month period ended March 31, 2006 and 2005 were euro 1,560,000 and
euro 1,790,000, respectively. As SFAS 123R has been adopted using the
modified-prospective- transition method, stock-based compensation costs for
the three-month period ended March 31, 2005 has not been adjusted for the
effects of adopting SFAS 123R as of the beginning of that period.
The fair value of instruments issued under the share-based compensation
plans was calculated using an option pricing model. The following table
summarizes the assumptions used in calculating the fair value in the three-
month period ended March 31, 2006 and 2005:
Period granted 2006 2005
Risk-free rate 2.90% 2.90%
Dividend yield 0.0% 0.0%
Volatility 60.36% 77.81%
Option grant valuation method Multiple option Single option
Estimated life Vesting period plus 4 years
1.04 years
Under SFAS 123R, SARs will continue to be accounted for as liability
awards, however the timing of the recognition of the award expense is
different than before the adoption. The ultimate compensation cost for
SARs, if any, is the same after the adoption of SFAS 123R as before the
adoption.
As a result of adopting SFAS 123R on January 1, 2006, the Company's
loss before income taxes and net loss for the three-months ended March 31,
2006, are euro 496,000 lower than if it had continued to account for
share-based compensation under SFAS 123. Basic and diluted loss per share
for the three- months ended March 31, 2006 would have been euro (0.43) if
the company had not adopted SFAS 123R, compared to reported basic and
diluted loss per share of euro (0.41).
3. Commitments and Contingencies
The Company has several contingent commitments regarding payments
pending on meeting milestones relating to research activities. In this
quarter the Company initiated a cash bonus plan to retain the Company's
employees until satraplatin gains marketing approval in the U.S. and in
Europe. As of March 31, 2006 there were no recorded liabilities and
expenses recognized with respect to this bonus plan or other research
milestones as the milestones have not been met.
The Company may be party to certain legal proceedings and claims which
arise during the ordinary course of business. In the opinion of management,
the ultimate outcome of these matters will not have material adverse
effects on the Company's financial position, results of operations or cash
flows.
4. Loss per Share
Basic loss per common share is computed using the weighted average
number of common shares outstanding during the period. Diluted net loss per
common share is computed using the weighted average number of common and
dilutive common equivalent shares from stock options and convertible debt
using the treasury stock method. For all periods presented, diluted net
loss per share is the same as basic net loss per share, as the inclusion of
weighted average shares of common stock issuable upon the exercise of stock
options and convertible debt would be antidilutive.
5. Comprehensive Loss
Comprehensive loss was euro 12.9 million and euro 11.8 million for the
three months ended March 31, 2006 and 2005, respectively. Comprehensive
loss is composed of net loss, unrealized gains and losses on marketable
securities and short-term investments and cumulative foreign currency
translation adjustments. Accumulated other comprehensive loss at March 31,
2006 and 2005 reflected euro 0.1 million of unrealized losses and euro 0.4
million of unrealized gains on marketable securities and short-term
investments, and euro 2.0 million and euro 2.5 million of cumulative
foreign currency translation loss adjustments, respectively.
6. Shareholders' Equity
On February 23, 2006, the Company issued 2,860,000 new ordinary shares
at euro 12.67 per share for a total amount of euro 36.2 million through a
private placement. The transaction was recorded in shareholders' equity net
of costs of transaction of euro 0.1 million.
During the three months ended March 31, 2006, employees and convertible
bondholders of the Company exercised some of their fully vested options and
convertible bonds, receiving 77,476 new ordinary shares of the Company.
7. Additional Disclosures
The following disclosures are provided to comply with disclosure
requirements of the Exchange Rules of the Frankfurt Stock Exchange.
Number of Employees
As of March 31, 2006 and 2005, the number of employees totalled 224 and
211, respectively.
Shareholdings of Management
As of March 31, 2006, the members of the Management Board and
Supervisory Board held shares, options, convertible bonds and stock
appreciation rights in the amounts set forth in the table below:
Number of Number of Number of Number of
Shares Options Convertible Stock
Bonds Appreciation
Rights
Management Board
Bernd R. Seizinger, M.D.,
Ph.D. - 1,249,280 770,000 -
Elmar Maier, Ph.D. 170,000 289,000 291,000 -
Sebastian Meier-Ewert,
Ph.D. 229,405 299,000 330,500 -
Mirko Scherer, Ph. D. 24,000 359,000 301,000 -
Supervisory Board
Jurgen Drews, M.D.
(Chairman) 28,800 10,000 25,000 40,000
Michael Lytton
(Vice Chairman) 7,500 10,000 31,500 30,000
Metin Colpan, Ph.D. 19,400 10,000 10,000 22,500
Prabhavathi Fernandes,
Ph.D. - - 10,000 25,000
James Frates 1,000 - - 30,000
Peter Preuss 87,500 - 22,500 25,000
SOURCE GPC Biotech AG
 back to top
Related links:
http://www.gpc-biotech.com/
CONTACT:
Martin Braendle, Associate Director, Investor
Relations & Corporate Communications, +49 (0)89 8565-2693,
ir@gpc-biotech.com, or Laurie Doyle, Associate Director, Investor
Relations & Corporate Communications, +1- 781-890-9007 ext. 267,
usinvestors@gpc-biotech.com, both of GPC Biotech AG; or In the
U.S.: Matt Haines of Euro RSCG Life NRP, +1-212-845-4235,
matthew.haines@eurorscg.com; or In Europe: Brian Hudspith of
Maitland Noonan Russo, +44 (0)20 7379 5151,
bhudspith@maitland.co.uk
|
