WATERTOWN, Mass., July 27 /PRNewswire-FirstCall/ -- V.I. Technologies,
Inc. (Nasdaq: VITX) ("Vitex" or "the Company"), a biotechnology company
dedicated to developing the next generation of anti-infective products, today
announced its financial results for the second quarter ended June 30, 2005.
Vitex closed its merger with Panacos Pharmaceuticals, Inc. ("Panacos") in
March, 2005. For accounting purposes, the transaction is considered a "reverse
merger" under which Panacos is considered the acquirer of Vitex. Accordingly,
2004 results and share counts used for comparison with 2005 reflect Panacos
historical information.
For the second quarter of 2005, Vitex reported a net loss of $8.3 million
or $0.21 per share versus a net loss of $3.7 million or $7.41 per share for
the second quarter of 2004. One time charges of $2.2 million were included in
the net loss in the second quarter of 2005. These charges had no cash impact
in the reported results for the second quarter of 2005 and are largely
associated with the decision to discontinue development of the INACTINE system
for red blood cells.
Revenue from research funding in the second quarter of 2005 was $0.3
million, essentially unchanged from the second quarter of 2004. Research and
development spending in the second quarter of 2005 increased to $4.6 million
from $2.8 million in the second quarter of 2004. The majority of the increase
was attributable to the increased PA-457 expenses associated with the Phase 2a
clinical studies versus the earlier stage Phase 1 trials that were in progress
during Q2, 2004. Also contributing to the year over year increase was spending
associated with preparing for later stage trials of PA-457, and the expanded
investment in pre-clinical programs targeted at developing additional novel
clinical drug candidates to treat HIV.
General and administrative spending in the second quarter of 2005
increased to $2.3 million from $0.7 million in the second quarter of 2004.
Approximately one third of the increase is due to adding the public company
infrastructure of Vitex as a result of the merger. In the second quarter of
2005, the company also recorded a charge for severance expenses of
approximately $0.5 million due in part to the decision to discontinue
investment in the development of the INACTINE system for red blood cells. This
charge had no cash impact in the second quarter of 2005 but will have a cash
impact in Q3, 2005 and Q1, 2006.
In addition, the company recorded a non-cash impairment charge of $1.65
million as a result of the decision to discontinue development of the INACTINE
system. The charge includes tangible and intangible assets associated with the
development of the INACTINE system.
Unrestricted cash and cash equivalents were $15.3 million at June 30,
2005. On April 29, 2005, Vitex closed a rights offering of the Company's
common stock to Vitex shareholders of record as of March 9, 2005. Vitex issued
approximately 1.23 million shares and raised gross proceeds of approximately
$2.5 million. The Company also filed a shelf registration statement on Form S-
3 in the second quarter of 2005 with the Securities and Exchange Commission
(SEC). The registration statement was declared effective in July by the SEC
and allows Vitex, from time to time, to offer and sell up to $50 million in
equity securities.
"During the second quarter, we made strong progress with the development
of PA-457, our oral maturation inhibitor for treatment of HIV currently in
Phase 2 clinical testing," said Dr. Samuel Ackerman, Chairman and CEO of
Vitex. "Following our recent successful Phase 1/2 study, we look forward to
reporting the results of our Phase 2a trial later this quarter. Our team is
now completely focused on developing innovative orally available therapeutics
for HIV and other major viral infections."
PA-457 is the first in a new class of oral HIV therapeutics discovered by
Vitex scientists called maturation inhibitors. By targeting a novel step in
the virus life cycle, maturation inhibitors are designed to have potent
activity against HIV, including strains that are resistant to existing classes
of drugs. Drug resistance is the most pressing problem in HIV therapy and the
leading cause of treatment failure.
Highlights for Q2 2005 include:
* Vitex continued enrolling patients in the Phase 2a trial during the
second quarter and completed enrollment and dosing of subjects in the
study in July, 2005. In this study PA-457 or placebo was administered
once daily for ten days to 32 HIV-infected patients off other therapy
with the objective of determining the magnitude of viral load reduction
following multiple doses of PA-457. The Company is targeting to submit
the data in a late-breaker abstract during August, 2005 for
presentation, if accepted, at the 45th Interscience Conference on
Antimicrobial Agents and Chemotherapy (ICAAC) to be held September 21 -
24 in New Orleans, LA.
* The Company continued preparations to initiate a Phase 2b study at
multiple clinical sites in the U.S. In this study, PA-457 will be
administered to HIV-infected patients in combination with other approved
HIV drugs to determine its effect on viral load and its safety. Based
on our internal data and prior data in the scientific literature which
suggested limited potential for significant drug interactions between
PA-457 and approved HIV drugs, the Company proposed that drug
interaction analysis also be incorporated into the Phase 2b study rather
than designing separate clinical trials to assess potential drug
interactions. However, in a recent communication, FDA suggested that
two separate drug interaction studies be conducted prior to the Phase 2b
trial, to study the possible effects of co-administration of PA-457 with
ritonavir or atazanavir. The Company plans to perform the two clinical
studies recommended by FDA, which are of relatively short duration and
are projected to result in the initiation of the Phase 2b study in the
first half of 2006 rather than our prior estimate of Q4, 2005.
* Vitex announced that it will discontinue direct investment in the
development of the INACTINE system while undertaking efforts to license
the technology and intellectual property to potential partners.
* Based on the decision to focus future efforts on the development and
commercialization of innovative antiviral therapeutics based on the
therapeutic platform acquired earlier this year with the merger with
Panacos Pharmaceuticals, the Company announced, that subject to
shareholder approval, it will change the corporate name to Panacos
Pharmaceuticals.
* Vitex was added to the new Russell Microcap(TM) Index. Russell indexes
are widely used by investment managers and institutional investors for
index funds and as benchmarks for both passive and active investment
strategies.
Vitex will hold a conference call today to discuss the second quarter
results at 9:00 AM (EDT). The conference call may be accessed by dialing 800-
905-0392 (domestic) or 785-832-2422 (international). A replay of the
conference call will be available for 48 hours and may be accessed by dialing
888-562-2849 (domestic) or 402-220-7359 (international).
About Vitex
Vitex is developing the next generation of anti-infective products through
discovery and development of small molecule oral drugs for the treatment of
HIV and other major human viral diseases. Vitex's proprietary discovery
technologies and lead therapeutic candidate PA-457 focus on novel targets in
the virus life cycle, including virus maturation and virus fusion. For more
information on Vitex, please visit our web site at:
http://www.vitechnologies.com.
Except for the historical information contained herein, the matters
discussed are forward-looking statements made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. These
statements involve risks and uncertainties, such as the progress of clinical
development of PA-457 and the timing of results of clinical trials, the
execution of the Company's financing plans, the timely availability of new
products, market acceptance of the Company's products, the impacts of
competitive products and pricing, government regulation of the Company's
products, the Company's ability to complete product development collaborations
and other strategic transactions and other risks and uncertainties set forth
in the Company's filings with the Securities and Exchange Commission. These
risks and uncertainties could cause actual results to differ materially from
any forward-looking statements made herein.
CONTACT:
Samuel K. Ackerman, MD
Chairman & CEO
617-926-1551
sackerman@vitechnologies.com
V.I. TECHNOLOGIES, INC.
CONDENSED STATEMENTS OF OPERATIONS
(in thousands, except for per share data)
(unaudited)
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
2005 2004 2005 2004
Revenues:
Research funding $281 $271 $733 $494
Operating expenses:
Research and development costs 4,622 2,767 8,912 4,266
General and administrative
expenses 2,347 643 3,717 1,045
In-process research and
development - - 19,417 -
Impairment charge 1,650 - 13,773 -
Total operating expenses 8,619 3,410 45,819 5,311
Loss from operations (8,338) (3,139) (45,086) (4,817)
Interest (income) expense, net (95) (15) (122) 103
Other (income) expense, net 7 - (15) -
Net loss (8,250) (3,124) (44,949) (4,920)
Accretion of preferred stock
dividends - 542 - 782
Net loss available to common
stockholders ($8,250) ($3,666) ($44,949) ($5,702)
Basic and diluted net loss per share $(0.21) $(7.41) $(1.83) $(12.21)
Weighted average shares used in
calculation of basic and diluted
net loss per share 38,966 495 24,576 467
V.I. TECHNOLOGIES, INC.
CONDENSED BALANCE SHEETS
(in thousands)
(unaudited)
June 30, December 31,
2005 2004
Cash $15,323 $4,879
Restricted cash 250 125
Other current assets 811 342
Property and equipment, net 2,561 310
Other assets 636 675
Total assets $19,581 $6,331
Accounts payable and accrued expenses $5,727 $2,614
Deferred rent 114 81
Term debt obligations 916 164
Redeemable preferred stock - 29,918
Stockholders' equity 12,824 (26,446)
Total liabilities,
redeemable preferred
stock and stockholders'
equity $19,581 $6,331
SOURCE V.I. Technologies, Inc.
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Related links:
http://www.vitechnologies.com
CONTACT:
Samuel K. Ackerman, MD, Chairman & CEO of
V.I. Technologies, Inc., +1-617-926-1551,
sackerman@vitechnologies.com
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