WALTHAM, Mass., Aug. 8 /PRNewswire-FirstCall/ -- Repligen Corporation
(Nasdaq: RGEN) today reported results for the first quarter of fiscal year
2007, ended June 30, 2006. Total revenue for the first quarter consisting
primarily of Protein A sales and SecreFlo(R) sales was $3,628,000 compared
to total revenue of $4,239,000 for the first quarter of fiscal 2006, a
decrease of $611,000. Gross profit on product revenue for the first quarter
of fiscal 2007 was $2,371,000 (70%) compared to $3,040,000 (76%) for the
first quarter of fiscal 2006.
Operating expenses for the first quarter of fiscal year 2007 were
$3,749,000 compared to $3,358,000 for the same period in fiscal year 2006.
This increase in operating expenses of $391,000 was primarily the result of
increased personnel and stock option expenses. The company adopted
Statement of Financial Accounting Standards no. 123R as of April 1, 2006.
As a result, the Company is recording compensation expense for stock
options awarded to employees in its Statement of Operations for the first
time. The total expense recorded for the quarter ended June 30, 2006 was
$249,000. There was no expense recorded for the comparable quarter ended
June 30, 2005.
The net income for the first quarter of fiscal year 2007 was $101,000
and basic and diluted earnings were $0.00 per share, compared to a net
income of $2,186,000 and basic and diluted earnings were $0.07 per share
for the same period in fiscal year 2006. The fiscal 2006 results included a
one time gain of $1,169,000 associated with a favorable settlement of the
SecreFlo(R) arbitration in May 2005. Cash and investments as of June 30,
2006 were $22,517,000 compared to $23,408,000 as of March 31, 2006.
"During this quarter we recorded our second highest level of product
sales to date and we remain confident in the long term growth potential of
our core Protein A business," stated Walter C. Herlihy, President and Chief
Executive Officer of Repligen Corporation. "We are committed to building
shareholder value through a prudent business strategy in which the growing
profits from current product sales enable us to develop our intellectual
property and our pipeline of neurology drugs without the financial risks
typically associated with an emerging biotech company."
Update on Product Development Programs
Protein A
- Previously we had announced that we completed the construction of a new
purification suite, which allows us to increase our annual manufacturing
throughput to more than 100kg of Protein A per year. We have now
completed the construction of a new fermentation suite, which will allow
us to decrease our reliance on external fermentation contractors,
enhance the security of our supply, maintain a high level of quality
assurance and potentially increase our ability to control costs. We
anticipate that this facility will be operational by the end of the
second quarter.
Secretin
- Secretin is a gastrointestinal hormone involved in the process of
digestion, which has also been shown to have activity in the central
nervous system. Secretin signals the release of fluids into the ducts
of the pancreas, a result that has been documented in the literature to
improve MRI imaging of the pancreas. In June we announced that we
initiated a clinical trial to evaluate the use of secretin to aid in the
detection of structural abnormalities of the pancreas. Most of the
clinical sites in this study have been initiated and we anticipate the
patients will be enrolled in approximately 6 months. We believe there
may be more than 100,000 potential MRI images of the pancreas in the
U.S. each year that could benefit from the use of secretin.
- Last October we announced the initiation of a follow-on study to our
previously reported Phase 2 study of secretin in schizophrenia to
determine if the preliminary observation that secretin has the potential
to improve certain cognitive deficits in patients with schizophrenia was
reproducible. There was a statistically significant improvement in the
secretin group 24 hours after treatment, however, the difference was not
significantly different between the groups 2 hours after treatment.
Based on these conflicting observations, we have decided not to invest
additional resources into this clinical application.
Uridine
- In February, we announced that we had initiated a Phase 2 clinical trial
of uridine in bipolar disorder. This is a multi-center, dose escalating
study in which 80 patients will receive either an oral formulation of
uridine or a placebo for 6 weeks. We have enrolled approximately 25% of
the patients with 6 open sites and we expect to complete enrollment in
this study by the end of the first quarter of next year.
Intellectual Property
- In January, Repligen and The University of Michigan jointly filed a
complaint against Bristol-Myers Squibb Company (Bristol) in the United
States District Court for the Eastern District of Texas for infringement
of U.S. Patent No. 6,685,941 for the commercial sale of Orencia(R). The
patent entitled "Methods of Treating Autoimmune Disease via CTLA4-Ig,"
covers methods of using CTLA4-Ig to treat rheumatoid arthritis, as well
as other autoimmune diseases. Previously, Bristol filed a motion
seeking to transfer the case from the Eastern District of Texas, which
we opposed. In July, the Court ruled in our favor denying Bristol's
motion to transfer. We anticipate that the judge will hold a scheduling
conference in the next few months.
- Repligen and The Massachusetts Institute of Technology (MIT) previously
filed suit against ImClone Systems, Inc. (ImClone) alleging that
ImClone's production of Erbitux(R) infringes U.S. patent 4,663,281,
which covers certain genetic elements that increase protein
production in a mammalian cell. On July 28, 2006, the United States
District Court for the District of Massachusetts issued a Summary
Judgment ruling in favor of Repligen and MIT and rejected ImClone's
defense of patent exhaustion, thereby eliminating ImClone's patent
exhaustion argument as a potential defense for ImClone at trial. ImClone
has previously reported that it produced approximately $1 billion worth
of Erbitux(R) prior to the expiration of the patent-in-suit in 2004 and
that Bristol, ImClone's commercial partner, has paid ImClone $900
million in up-front and milestone payments as well as a 39% royalty on
the net sales of Erbitux(R) in the United States. In addition, in
March, Repligen and MIT filed a motion against ImClone seeking sanctions
based on conduct that in our view constituted intimidation of a central
witness in the case. In May, the Court heard oral arguments on the
motion. Recently the Court has ordered that an evidentiary hearing take
place on this motion on September 26th.
Quarterly Conference Call
Repligen will host a conference call and webcast on Tuesday August 8th
at 11:00 a.m. EDT, to report first quarter 2007 financial results and to
provide a quarterly update of the Company. This call can be accessed via
Repligen's website at http://www.repligen.com. If you are unable to access the
webcast via the internet, you may also listen to the live broadcast by
calling (800) 706-7749 for domestic calls and (617) 614-3474 for
international calls. Participants must provide the following passcode:
73128522.
About Repligen Corporation
Repligen Corporation is a biopharmaceutical company focused on the
development of novel therapeutics for diseases that affect the central
nervous system. In addition, we currently market two commercial products,
Protein A and SecreFlo(R), which partially fund the advancement of our
development pipeline while supporting our financial stability. Repligen's
corporate headquarters are located at 41 Seyon Street, Building #1, Suite
100, Waltham, MA 02453. Additional information may be requested from
http://www.repligen.com.
SELECTED FINANCIAL DATA
Operating Statement Data:
Three months ended
June 30,
2006 2005
Revenue:
Product revenue $3,364,000 $4,013,000
Other revenue 264,000 226,000
Total revenue 3,628,000 4,239,000
Operating expenses:
Cost of product revenue 993,000 973,000
Research and development 1,215,000 1,190,000
Selling, general and administrative 1,541,000 1,195,000
Total operating expenses 3,749,000 3,358,000
Income (loss) from operations (121,000) 881,000
Interest expense (3,000) -
Investment income 225,000 136,000
Other income - 1,169,000
Net income $101,000 $2,186,000
Earnings Per Share:
Basic and diluted $- $0.07
Weighted average shares outstanding:
Basic 30,357,635 30,094,435
Diluted 30,828,072 30,398,735
June 30, 2006 March 31, 2006
Balance Sheet Data:
Cash and marketable securities * $22,517,000 $23,408,000
Total assets 28,708,000 28,599,000
Stockholders' equity 25,782,000 25,433,000
* does not include restricted cash of $200,000
This press release contains forward-looking statements which are made
pursuant to the safe harbor provisions of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended. The forward-looking statements in this release do not
constitute guarantees of future performance. Investors are cautioned that
statements in this press release which are not strictly historical
statements, including, without limitation, statements regarding current or
future financial performance and position, management's strategy, plans and
objectives for future operations, plans and objectives for product
development, plans and objectives for present and future clinical trials
and results of such trials, plans and objectives for regulatory approval,
litigation, intellectual property, product development, manufacturing plans
and performance such as the anticipated growth in the monoclonal antibody
market and our other target markets and projected growth in product sales,
constitute forward-looking statements. Such forward-looking statements are
subject to a number of risks and uncertainties that could cause actual
results to differ materially from those anticipated, including, without
limitation, risks associated with: the success of current and future
collaborative relationships, the market acceptance of our products, our
ability to compete with larger, better financed pharmaceutical and
biotechnology companies, new approaches to the treatment of our targeted
diseases, our expectation of incurring continued losses, our uncertainty of
product revenues and profits, our ability to generate future revenues, our
ability to raise additional capital to continue our drug development
programs, the success of our clinical trials, our ability to develop and
commercialize products, our ability to obtain required regulatory
approvals, our compliance with all Food and Drug Administration
regulations, our ability to obtain, maintain and protect intellectual
property rights for our products, the risk of litigation regarding our
intellectual property rights, our limited sales and manufacturing
capabilities, our dependence on third-party manufacturers and value added
resellers, our ability to hire and retain skilled personnel, our volatile
stock price, and other risks detailed in Repligen's filings with the
Securities and Exchange Commission. Repligen assumes no obligation to
update any forward-looking information contained in this press release or
with respect to the announcements described herein.
SOURCE Repligen Corporation
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Related links:
http://www.repligen.com
CONTACT:
Walter C. Herlihy, Ph.D., President and Chief
Executive Officer, +1-781-419-1900, or Laura Whitehouse, VP
Market Development, +1-781-419-1812
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