Operating Loss Continues to Decline; Strategic Business Unit Realignment
Completed; Clinical Update Provided for NicVAX Phase 2b Proof of Concept
Trial
BOCA RATON, Fla., Aug. 1 /PRNewswire-FirstCall/ -- Nabi
Biopharmaceuticals (Nasdaq: NABI) today announced its second quarter
financial results. The company recorded a net loss from continuing
operations of $5.3 million, or $0.09 per share, for the quarter ended June
30, 2007, compared to $13.7 million, or $0.22 per share for the quarter
ended July 1, 2006. Revenues for the second quarter of 2007 were $20.9
million compared to $20.4 million in 2006. Nabi-HB(R) [Hepatitis B Immune
Globulin (Human)] revenues were $8.7 million during the second quarter of
2007 compared to $7.2 million during the second quarter of 2006.
For the six months ended June 30, 2007, the company's net loss from
continuing operations was $16.0 million, or $0.26 per share, compared to
$29.1 million, or $0.48 per share, for the six months ended July 1, 2006.
Revenues for the year to date period were $44.6 million compared to $39.9
million in the first half of 2006.
Total cash used in operating activities was $18.9 million during the
first half of 2007, a 44% reduction compared to $33.7 million in the first
half of 2006. Excluding discontinued operations, cash used in operating
activities was $13.1 million for the first half of 2007, a 53% reduction
compared to $27.7 million for six months ended July 1, 2006. Cash, cash
equivalents and marketable securities were $103.9 million at the end of the
second quarter.
Nabi has completed the formation of two strategic business units (SBUs)
-- Nabi Biologics and Nabi Pharmaceuticals -- to realign and optimize our
businesses and support the strategic alternatives process. In connection
with this realignment, the company also created a Corporate Shared Services
(CSS) group. Given the creation of these two SBUs and the CSS group, Nabi
has revised its segment reporting disclosures. Second quarter operating
results for these segments were:
-- Nabi Biologics revenues were $20.8 million in the second quarter of
2007, which included $11.9 million and $8.7 million in sales of
antibody and Nabi-HB products, respectively. Nabi Biologics operated
as a profitable SBU, with an operating income of $1.1 million for the
three months ended June 30, 2007.
-- The Nabi Pharmaceuticals SBU posted an operating loss of $2.8 million
in the second quarter of 2007 driven by its research and development
costs, which were strategically reduced by 56% from $6.4 million
during the same quarter in 2006.
-- Corporate Shared Services costs totaled $6.7 million for the three
months ended June 30, 2007, a 20% reduction from the second quarter of
2006.
"We are pleased to see the stand-alone performance of the Nabi
Biologics SBU and continue our efforts to strengthen and advance the
Biologics pipeline," said Dr. Leslie Hudson, interim president and chief
executive officer of Nabi Biopharmaceuticals. "We have also taken critical
steps to move Nabi Pharmaceuticals - and its key programs, NicVAX and
StaphVAX - closer to a strategic partnership and to the market. We are very
optimistic about the clinical benefit of NicVAX, as evidenced by our
continuing flow of positive data from our NicVAX Phase 2b trial."
NicVAX Phase 2b Clinical Trial Update
Nabi also announced today initial nine-month findings from its ongoing
trial of NicVAX(R) (Nicotine Conjugate Vaccine), the company's innovative
and proprietary investigational vaccine being developed to treat nicotine
addiction and prevent smoking relapse:
-- Further analysis of the six-month data has enabled Nabi to determine
both the therapeutic threshold at which quitting is first observed as
well as the target upper limit of antibody concentration.
-- In the nine-month data, NicVAX continues to demonstrate efficacy in
support of long-term smoking abstinence - the most effective NicVAX
dose regimen was 400 micrograms delivered in five injections over six
months. A statistically significant difference was seen when this
treated group was compared to placebo over time for the full Intent to
Treat (ITT) population:
-- Fixed 4-Week: NicVAX=24% (n=12/51); Placebo=14% (n=14/100) - p=0.14
-- Fixed 8-Week: NicVAX=20% (n=10/51); Placebo=13% (n=13/100) - p=0.29
-- Fixed 20-Week: NicVAX=20% (n=10/51); Placebo= 4% (n=4/100) -
p=0.0018
-- Fixed 34-Week: NicVAX=18% (n=9/51); Placebo=4% (n=4/100) - p=0.0047
-- To date, NicVAX continues its attractive safety trends with a
favorable adverse events profile comparable between placebo and each
dose group.
Recent Accomplishments
April:
-- Executed a definitive agreement to sell Aloprim(TM) (allopurinol
sodium) for Injection to Bioniche Teoranta for $3.7 million; the sale
was completed in May
May:
-- Established "proof of concept" for NicVAX in its Phase 2b clinical
trial, which met its primary endpoint of eight weeks of continuous
smoking abstinence between weeks 19-26
-- Participated in the Phacilitate Vaccine Forum Munich 2007, where
NicVAX principal investigator Dr. Dorothy Hatsukami, Forster Family
Professor in Cancer Prevention and Professor of Psychiatry at the
University of Minnesota Tobacco Use Research Center, discussed NicVAX
Phase 2b data in greater detail
June:
-- Formed the Nabi Biologics SBU and expanded the role of Dr. Raafat
Fahim, Senior Vice President, Research, Technical and Production
Operations to also include Chief Operating Officer and General Manager
of the Biologics SBU
-- Formed the Corporate Shared Services (CSS) group and expanded the role
of Jordan Siegel to Senior Vice President, Finance and Administration,
Chief Financial Officer and Treasurer
July:
-- Formed the Nabi Pharmaceuticals SBU and appointed Dr. Matthew W.
Kalnik Vice President, Business Development and Project Management to
accelerate partnership discussions for Nabi's NicVAX and StaphVAX
programs
-- Reorganized the Nabi employee base to better align with the new
internal structure -- Nabi has eliminated a total of 65 positions and
expects to realize future annualized savings of approximately $6.3
million
-- Completed enrollment in our Anti-D Phase I trial; study completion
expected by end of 2007
Upcoming Milestones
Nabi is currently working toward achieving the following corporate
milestones in 2007:
-- Successfully complete the strategic alternatives process with the
support of Banc of America Securities LLC
-- Continue to work to obtain approval for Nabi-HB(R) Intravenous
[Hepatitis B Immune Globulin (Human) Intravenous] in the U.S.;
leverage expertise of Cato Research Ltd.
-- Advance development partnerships for NicVAX and the Gram-positive
programs
-- Continue to provide data from Nabi's ongoing Phase 2b trial of NicVAX
-- Complete enrollment in the 'proof of concept' clinical trial for
Civacir
-- Resubmit the file for regulatory approval of HEBIG(TM) [Hepatitis B
Immune Globulin (Human) Intravenous] in Europe
-- Continue patient recruitment in the Phase 3 trial of ATG-Fresenius S
(anti-T-lymphocyte globulin) in lung transplant patients
-- Initiate the clinical trial of our intravenous immunoglobulin, IVIG
Review of Operations
Nabi Biologics
Nabi Biologics revenues were $20.8 million in the second quarter of
2007, which primarily included $11.9 million and $8.7 million in sales of
antibody and Nabi-HB products, respectively. This was an increase of $1.0
million from the second quarter of the prior year due to increased end user
demand and sales of Nabi-HB.
Nabi Biologics research and development expenses totaled $6.2 million
during the three months ended June 30, 2007, compared to $2.5 million for
the same period last year, due largely to acceleration of Nabi's Civacir,
Anti-D and IVIG clinical development programs.
Nabi Pharmaceuticals
Nabi Pharmaceuticals research and development costs were $2.8 million
during the three months ended June 30, 2007, compared to $6.4 million for
the same period last year. This is largely the result of decreased spending
associated with StaphVAX and a $0.9 million benefit related to NicVAX from
our grant by the U.S. National Institute on Drug Abuse.
Corporate Shared Services
CSS costs included those associated with finance, IT, HR, business
development, legal, government affairs, investor relations, corporate
governance and executive administration activities and totaled $6.7 million
for the three months ending June 30, 2007, compared to $8.4 million for the
second quarter in 2006. This decrease reflects lower consulting and
personnel-related expenses incurred in the current year quarter as we
reorganized our internal employee base and continue to lower our overall
infrastructure costs.
Second Quarter Financial Results Conference Call
The company will host a live webcast at 4:30 p.m. EDT today to discuss
these results.
The live webcast can be accessed at:
http://phx.corporate-ir.net/phoenix.zhtml?p=irol-
eventDetails&c=100445&eventID=1603855
or via the Nabi Biopharmaceuticals website at http://www.nabi.com.
If you do not have Internet access, the U.S./Canada call-in number is
(800) 638-5439, conference code 14030912, and the international call-in
number is (617) 614-3945, conference code 14030912. An audio replay will be
available for U.S./Canada callers at (888) 286-8010, conference code
74258104, and for international callers at (617) 801-6888, conference code
74258104.
An archived version of the webcast will be available at the same
Internet address through August 8, 2007. The audio replay also will be
available through August 8, 2007. The press release will be available on
the company's website at http://www.nabi.com.
About Nabi Biopharmaceuticals
Nabi Biopharmaceuticals leverages its experience and knowledge in
powering the immune system to develop and, in certain areas, market
products that target serious medical conditions in the areas of hepatitis
and transplants, gram positive bacterial infections and nicotine addiction.
We are a vertically integrated company with sales of antibodies and other
biologics, including Nabi-HB(R) [Hepatitis B Immune Globulin (Human)], a
pipeline of products in various stages of development, state-of-the-art
manufacturing capability and a cash position that will allow us to advance
our near-term pipeline products. The company has recently announced the
formation of two strategic business units: Nabi Biologics and Nabi
Pharmaceuticals. Nabi Biologics has responsibility for the company's
protein and immunological products and development pipeline, including
Nabi-HB. Nabi Pharmaceuticals is responsible for the NicVAX(R) (Nicotine
Conjugate Vaccine) and StaphVAX(R) (Staphylococcus aureus Polysaccharide
Conjugate Vaccine) development programs. For a complete list of pipeline
products, please go to: http://www.nabi.com/pipeline/index.php. The company
is headquartered in Boca Raton, Florida. For additional information about
Nabi Biopharmaceuticals, please visit our Web site: http://www.nabi.com.
Forward-Looking Statements
Statements in this release that are not strictly historical are
forward- looking statements and include statements about reorganization of
our current business into two new business units, our strategic
alternatives process and clinical trials and studies. You can identify
these forward-looking statements because they involve our expectations,
beliefs, projections, anticipations or other characterizations of future
events or circumstances. These forward- looking statements are not
guarantees of future performance and are subject to risks and uncertainties
that may cause actual results to differ materially from those in the
forward-looking statements as a result of any number of factors. These
factors include, but are not limited to, risks relating to our ability to:
realize anticipated cost savings related to job elimination due to greater
than anticipated severance-related costs or other factors; successfully
partner with third parties to fund, develop, manufacture and/or distribute
our existing and pipeline products, including NicVAX and our Gram- positive
infections products; obtain successful clinical trial results; our ability
to successfully complete our strategic alternatives process; generate
sufficient cash flow from sales of products or from milestone or royalty
payments to fund our development and commercialization activities; attract
and maintain the human and financial resources to commercialize current
products and bring to market products in development; depend upon third
parties to manufacture or fill our products; achieve approval and market
acceptance of our products; expand our sales and marketing capabilities or
enter into and maintain arrangements with third parties to market and sell
our products; effectively and/or profitability use, or utilize the full
capacity of, our vaccine manufacturing facility; manufacture NicVAX or
other products in our own vaccine manufacturing facility; comply with
reporting and payment obligations under government rebate and pricing
programs; raise additional capital on acceptable terms, or at all; and
re-pay our outstanding convertible senior notes when due. Many of these
factors are more fully discussed, as are other factors, in the company's
Annual Report on Form 10-K for the fiscal year ended December 31, 2006 and
our Quarterly Report for the quarter ended March 31, 2007 on Form 10-Q with
the Securities and Exchange Commission.
Nabi Biopharmaceuticals
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
June 30, December 30,
2007 2006
Assets
Current assets:
Cash and cash equivalent $ 68,517 $ 86,227
Marketable securities 35,425 32,500
Trade accounts receivable, net 16,489 20,377
Inventories, net 18,592 19,260
Prepaid expenses and other
current assets 5,483 3,459
Assets of discontinued
operations 338 13,341
Total current assets 144,844 175,164
Property, plant and equipment, net 84,816 88,329
Other assets:
Intangible assets, net 1,247 1,683
Other, net 1,523 701
Total assets $232,430 $265,877
Liabilities and stockholders' equity
Current liabilities:
Trade accounts payable $ 6,751 $ 7,998
Accrued expenses 14,106 16,095
Capital lease obligations, net 155 291
Liabilities of discontinued
operations 4,146 20,554
Total current liabilities 25,158 44,938
2.875% convertible senior notes,
net 109,397 109,313
Other liabilities 243 238
Total liabilities 134,798 154,489
Commitments and contingencies
Stockholders' equity:
Convertible preferred stock - -
Common stock 6,190 6,149
Capital in excess of par 329,237 327,228
Treasury stock (5,321) (5,321)
Accumulated deficit (232,474) (216,668)
Total stockholders' equity 97,632 111,388
Total liabilities and
stockholders' equity $ 232,430 $ 265,877
Nabi Biopharmaceuticals
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share amounts)
For the Three For the Six
Months Ended Months Ended
June 30, July 1, June 30, July 1,
2007 2006 2007 2006
Revenues $ 20,873 $ 20,374 $ 44,621 $ 39,891
Cost of products sold 11,680 14,366 26,487 28,882
Gross margin 9,193 6,008 18,134 11,009
Selling, general and
administrative expense 8,574 11,143 18,587 22,999
Research and development
expense 9,048 8,883 19,104 17,661
Operating loss (8,429) (14,018) (19,557) (29,651)
Interest income 1,419 945 2,999 2,008
Interest expense (886) (905) (1,803) (1,858)
Other income, net 2,561 317 2,559 382
Loss from continuing
operations before
income taxes (5,335) (13,661) (15,802) (29,119)
Income taxes - - (190) -
Loss from continuing
operations (5,335) (13,661) (15,992) (29,119)
Net income (loss) from
discontinued operations 557 (1,163) 185 (3,782)
Net loss $ (4,778) $ (14,824) $ (15,807) $ (32,901)
Basic and diluted (loss)
income per share:
Continuing operations $ (0.09) $ (0.22) $ (0.26) $ (0.48)
Discontinued operations 0.01 (0.02) 0.00 (0.06)
Basic and diluted loss
per share (0.08) (0.24) (0.26) (0.54)
Basic and diluted
weighted average shares
outstanding 61,280 60,977 61,192 60,653
Nabi Biopharmaceuticals
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
For the Six Months Ended
June 30, July 1,
2007 2006
Cash flow from operating activities:
Loss from continuing operations $ (15,992) $ (29,119)
Adjustments to reconcile loss
from continuing operations to net
cash used in operating activities
from continuing operations:
Depreciation and amortization 4,150 4,464
Provision for slow moving or
obsolete inventory 111 453
Non-cash compensation 1,515 1,789
Gain on sale of assets, net (2,557) -
Disposal of fixed assets, net 40 236
Other 96 (407)
Changes in assets and liabilities:
Trade accounts receivable 3,875 4,277
Inventories (85) (2,097)
Prepaid expenses and other
current assets (634) (100)
Other assets 15 80
Accounts payable and accrued
expenses (3,589) (7,257)
Total adjustments 2,937 1,438
Net cash used in operating activities
from continuing operations (13,055) (27,681)
Net cash used in operating activities
from discontinued operations (5,803) (5,990)
Net cash used in operating activities (18,858) (33,671)
Cash flow from investing activities:
Purchases of marketable securities (28,500) (63,475)
Proceeds from sales of marketable
securities 25,575 29,550
Proceeds from sale of assets,
net of closing costs 1,300 8
Capital expenditures (568) (1,059)
Net cash used in investing activities
from continuing operations (2,193) (34,976)
Net cash provided by investing
activities from discontinued
operations 2,582 -
Net cash provided by (used in) investing
activities 389 (34,976)
Cash flow from financing activities:
Repayments of notes payable and
capital leases (137) (72)
Proceeds from exercise of employee
stock options 604 1,137
Net cash provided by financing activities
from continuing operations 467 1,065
Net cash provided by (used in) financing
activities from discontinued operations 292 (3,059)
Net cash provided by (used in) financing
activities 759 (1,994)
Net decrease in cash and cash equivalents (17,710) (70,641)
Cash and cash equivalents at beginning
of period 86,227 101,762
Cash and cash equivalents at end
of period $ 68,517 $ 31,121
Nabi Biopharmaceuticals
SUPPLEMENTAL SEGMENT INFORMATION
(Unaudited, in thousands)
For the Three For the Six
Months Ended Months Ended
June 30, July 1, June 30, July 1,
2007 2006 2007 2006
Revenues:
Nabi Biologics $ 20,847 $ 19,876 $ 44,614 $ 38,927
Nabi Pharmaceuticals 26 498 7 964
Total $ 20,873 $ 20,374 $ 44,621 $ 39,891
Gross margin (loss):
Nabi Biologics $ 9,192 $ 5,649 $ 18,245 $ 10,606
Nabi Pharmaceuticals 1 359 (111) 403
Total $ 9,193 $ 6,008 $ 18,134 $ 11,009
Operating income (loss):
Nabi Biologics $ 1,086 $ 155 $ 3,438 $ 693
Nabi Pharmaceuticals (2,809) (5,798) (7,735) (13,466)
Segment operating loss (1,723) (5,643) (4,297) (12,773)
CSS (6,706) (8,375) (15,260) (16,878)
Total $ (8,429) $ (14,018) $ (19,557) $ (29,651)
SOURCE Nabi Biopharmaceuticals
back to top
