MOUNTAIN VIEW, Calif., Aug. 2 /PRNewswire/ -- Aviron (Nasdaq: AVIR) today
announced results for the 2001 second quarter and first half of fiscal 2001,
ended June 30, 2001.
The company reported a net loss of $30.6 million (basic net loss of
$1.00 per share) for the second quarter of 2001, compared to a net loss of
$18.1 million (basic net loss of $0.86 per share) for the second quarter of
2000. For the first half of 2001, the company reported a net loss of
$58.1 million (basic net loss of $1.96 per share) compared to a net loss of
$59.9 million (basic net loss of $3.14 per share) for the first half of 2000.
The results for the second quarter and first half of 2000 were restated to
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 second quarter totaled $4.7 million, compared to
$3.1 million for the second quarter of 2000 and $7.9 million for the first
half of 2001, compared to $6.5 million for the first half of 2000. Revenues
during the second quarters and first halves of 2001 and 2000 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 second quarter totaled $36.8 million,
compared to $20.8 million for the 2000 second quarter, and $69.4 million for
the first half of 2001, as compared with $51.9 million for the first half of
2000.
Research and development costs increased to $31.9 million in the
2001 second quarter from $17.5 million in the 2000 second quarter and totaled
$60.0 million for the first half of 2001, as compared with $35.1 million in
the first half of 2000. The increase in research and development costs for
the second quarter and first half was due primarily to increases in
development activities, clinical trials, and commercial scale-up expenses
associated with FluMist(TM).
General, administrative and marketing costs increased to $4.9 million in
the 2001 second quarter from $3.4 million in the 2000 second quarter, and
$9.3 million for the first half of 2001, as compared to $5.9 million for the
first half of 2000. The increase was due to growth in infrastructure and
other costs to support preparations for a potential commercial launch of
FluMist(TM).
Cash, cash equivalents, short-term investments and long-term investments
totaled $493.7 million at June 30, 2001, compared to $136.8 million at
December 31, 2000.
Company events during the second quarter and early third quarter of 2001
include:
Regulatory Activities
-- On July 27, the U.S. Food and Drug Administration's (FDA) Vaccines and
Related Biological Products Advisory Committee (VRBPAC) recommended that there
are adequate data to support the efficacy of FluMist(TM) for the prevention of
influenza in healthy children and healthy adults ages 1 - 64. The committee
also recommended that the data analysis completed to date is not sufficient to
support the safety of the vaccine at this time. The Biologics License
Application for FluMist(TM) is currently under review by the FDA, which will
ultimately decide whether to approve the license application. Given the
committee's recommendation, we do not currently expect to begin
commercialization of FluMist(TM) for the 2001-2002 influenza season.
Financial Activities
-- On June 18, we issued a notice to call for redemption the remaining
$14.7 million of our outstanding 5 3/4 percent Convertible Subordinated
Notes due 2005 for redemption on July 18, 2001. Bondholders chose to
convert the entire amount of the outstanding notes into shares of our
common stock prior to the date set for redemption, with the majority of
the notes being converted in July 2001. These notes converted into
approximately 478,000 shares of our common stock.
-- During June 2001, we initiated activities for the early payoff of asset
backed loans, with interest rates ranging from 11.63 percent to
13.76 percent. In June, we prepaid loan balances totaling
approximately $7.2 million and in July we prepaid additional loan
balances totaling $6.5 million. These early loan payoffs resulted in
the recognition in June 2001 of additional expense of approximately
$640,000 related to the fees and costs of termination of these loans.
Board of Directors
-- On May 21, we announced that former U.S. Secretary of Commerce
Barbara Hackman Franklin had been elected to Aviron's board of
directors.
Business Outlook
We continue to 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
United Kingdom and expenses that we expect to incur as we build infrastructure
in support of potential commercialization of FluMist(TM) in the U.S. This
increase includes amortization expense associated with our manufacturing
activities in the United Kingdom. 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 for
approximately 438,000 shares of stock in the event of a 2001 licensure of
FluMist(TM) by the FDA. In the event FluMist(TM) is not licensed in 2001,
these options will expire.
Our goal has been to generate sufficient revenue to Aviron from
FluMist(TM) sales during 2002 to achieve profitability. Following a complete
response letter, currently anticipated at the end of August, and further
discussions with the FDA, we will provide an update on our goal for 2002. Any
and all FluMist(TM) sales projections for 2002 will depend upon the outcome
and timing of the regulatory process, 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 price paid to Aviron.
We expect capital expenditures to increase substantially as we commence
building additional manufacturing facilities and commercialization systems.
During 2001, we forecast that capital expenditures will be between
$20.0 and $30.0 million, which is a reduction of $10.0 million from previous
guidance.
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 Friday, August 3, 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. The call will be archived starting at 11:00 a.m. EDT on
August 3 until 5:00 p.m. EDT on August 7 at http://www.aviron.com. 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 press 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 this press 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, as amended, for the fiscal year ended
December 31, 2000 and other quarterly filings.
Additional information about the company, including recent press releases,
can be located at http://www.aviron.com.
AVIRON
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share data)
Three Months Six Months
Ended June 30, Ended June 30,
2001 2000 2001 2000
Revenues:
Contract revenues
and grants $4,714 $3,128 $7,929 $6,535
Operating Expenses:
Research and
development 31,924 17,476 60,018 35,070
Acquisition of
in process
research and
development -- -- -- 10,904
General,
administrative
and marketing 4,859 3,369 9,332 5,937
Total Operating
Expenses 36,783 20,845 69,350 51,911
Loss From
Operations (32,069) (17,717) (61,421) (45,376)
Other Income/
(Expense), net 1,466 (408) 3,352 (1,775)
Net Loss, before
cumulative
effect of
change in
accounting
principle (30,603) (18,125) (58,069) (47,151)
Cumulative effect
of change in
accounting
principle -- -- -- (12,750)
Net Loss $(30,603) $(18,125) $(58,069) $(59,901)
Basic and diluted
net loss
per share:
Net Loss, before
cumulative
effect of
change in
accounting
principle $(1.00) $(0.86) $(1.96) $(2.47)
Cumulative effect
of change in
accounting
principle -- -- -- (0.67)
Net Loss $(1.00) $(0.86) $(1.96) $(3.14)
Shares used in
calculation
of basic
net loss
per share 30,607 21,039 29,555 19,067
AVIRON
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
June 30, December 31,
2001 2000
(Unaudited) (Note)
ASSETS
Cash and cash equivalents
and short-term investments $417,911 $132,313
Accounts receivable 4,200 23,288
Inventory 5,656 4,264
Other current assets 5,102 2,691
Total Current Assets 432,869 162,556
Long-term investments 75,833 4,506
Property and equipment, net 32,279 27,707
Intangible assets 45,491 48,046
Debt issuance costs, deposits
and other assets 11,314 5,924
Total Assets $597,786 $248,739
LIABILITIES and STOCKHOLDERS' EQUITY
Current liabilities $40,391 $26,361
Long-term obligations,
less current portion 246,257 89,947
Other long-term liabilities 9,979 11,845
Total Liabilities 296,627 128,153
Stockholders' Equity 301,159 120,586
Total Liabilities and
Stockholders' Equity $597,786 $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:
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CONTACT:
Media and Investors, John Bluth,
+1-650-919-3716, or Asha Jennings, +1-650-919-1429, both of
Aviron; or Media, Ben Butkus of Fleishman-Hillard,
+1-212-453-2000, for Aviron; or Investors, Fred Kurland of
Aviron, +1-650-919-6666
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