CAMBRIDGE, Mass., Aug. 17 /PRNewswire-FirstCall/ -- Biopure Corporation
(Nasdaq: BPUR) announced today its financial results for the third fiscal
quarter ended July 31, 2006. For the quarter, the company reported a net
loss of $6.6 million, or $0.16 per common share, compared with a net loss
of $6.4 million, or $0.26 per common share, for the corresponding period in
2005. Class A common shares outstanding on July 31, 2006 and 2005 were
41,789,370 and 24,359,170, respectively.
Biopure also announced today that it has signed an agreement with
purchasers for a private placement of its common stock and warrants that,
subject to closing, will raise proceeds of approximately $5.0 million after
placement agent fees, assuming no exercise of the warrants. The company
intends to use the net proceeds for general corporate and working capital
purposes. The closing is expected to occur on or about August 23, 2006.
Under the terms of the agreement, Biopure is selling to accredited
investors 7,575,754 shares of its common stock and warrants to acquire an
additional 7,575,754 shares. The price for one share and one warrant is
$0.71, and the exercise price of each warrant is $0.89. The warrants have a
term of five years, become exercisable six months after the closing date,
and are callable by Biopure after the initial exercise date provided that
the weighted average price of Biopure's common stock for ten consecutive
days is over $1.335. Dawson James Securities, Inc. acted as the placement
agent for this transaction. Biopure is obligated to file with the U.S.
Securities and Exchange Commission a resale registration statement relating
to the common stock to be issued in the transaction and the shares of
common stock to be issued upon the exercise of the warrants.
Revenues
Total revenues for the third quarter of 2006 were $396,000, including
$312,000 from sales of Biopure's veterinary product Oxyglobin(R) and
$83,000 from past congressional appropriations administered by the U.S.
Army.* The Army payments reimburse Biopure for certain trauma development
expenses for Hemopure, the company's product for human use. Total revenues
for the same period in 2005 were $483,000, including $125,000 from Army
payments and $358,000 from Oxyglobin sales. The payments from the Army vary
relative to the amount of reimbursable activity of the company.
Cost of revenues was $2.9 million for the third quarter of fiscal 2006,
compared to $3.2 million for the same period in 2005. Cost of revenues
includes costs of both Oxyglobin and Hemopure. Hemopure cost of revenues,
consisting primarily of the allocation of unabsorbed fixed manufacturing
costs, was $2.2 million for the third quarter of fiscal 2006 compared to
$2.5 million for the same period in 2005. The decrease in Hemopure cost of
revenues was largely due to a decrease in inventory write-downs compared to
the third quarter of last year. Oxyglobin cost of revenues was $725,000 for
the third quarter of fiscal 2006 compared to $641,000 for the same period
in 2005.
Expenses
Research and development expenses were $1.8 million for the third
quarter of fiscal 2006, compared to $1.3 million for the corresponding
period in 2005. The increase was primarily due to added employees and
outside regulatory services.
Sales and marketing expenses increased to $197,000 for the third
quarter of fiscal 2006, from $143,000 for the same period in 2005 largely
due to expenses for a sales agent for Hemopure in South Africa. The Company
did not have a distributor in South Africa during 2005.
General and administrative expenses were $2.2 million for the third
quarter of fiscal 2006, compared to $2.4 million for the corresponding
period in 2005. The decrease was primarily due to lower spending on outside
services and decreased salaries expense. These decreases were partially
offset by other compensation expense, including stock-based compensation
recorded under Financial Accounting Standards Board Statement No. 123(R),
which the Company adopted in fiscal 2006, and other incentive compensation.
Financial Condition
Biopure had $7.0 million in cash on hand at July 31, 2006, including
approximately $654,000 in net proceeds raised during the quarter through
the exercise of warrants. As described above, on August 17, 2006 the
company signed an agreement with purchasers for a private placement of its
common stock and warrants that, subject to closing, will raise net proceeds
to Biopure of approximately $5.0 million.
Other Developments
In July 2006, Biopure submitted a marketing authorization application
(MAA) to the United Kingdom's Medicines and Healthcare products Regulatory
Agency (MHRA) seeking authorization to market Hemopure in the U.K. for the
treatment of acutely anemic adult orthopedic surgery patients under 80
years of age.
In Europe and South Africa, the company is conducting pilot clinical
trials of Hemopure in ischemia-related applications:
* A 60-patient Phase 2 trial in patients undergoing multi-vessel coronary
artery bypass graft (CABG) surgery has enrolled 15 patients to date in
Greece and the U.K.;
* A 100-patient Phase 2 trial in patients with peripheral vascular disease
who are undergoing limb amputation below or through the knee has
enrolled seven patients to date in South Africa, and patient screening
has begun in the U.K.;
* A proposed Phase 2 trial in patients with multi-vessel coronary artery
disease who are undergoing percutaneous coronary intervention (PCI) is
pending hospital authorization at the lead trial site in The
Netherlands.
Biopure is also working with cardiology consultants and clinical
investigators to develop protocols for potential Phase 2/3 trials of
Hemopure in heart attack patients.
In South Africa, Biopure is sponsoring a 50-patient single-center Phase
2 safety and feasibility trial of Hemopure, in a hospital setting, for
emergency treatment of unstable trauma patients with significant blood
loss. Enrollment has been slow and intermittent, with 21 patients enrolled
to date.
Hemopure is approved in South Africa for the treatment of adult
surgical patients who are acutely anemic and for the purpose of
eliminating, delaying or reducing the need for allogenic red blood cells in
these patients. Because allogenic red blood cells, when available, cost
less per unit than Hemopure in South Africa, Biopure's sales activities are
currently focused on promoting the use of Hemopure when red blood cells are
not readily available, seeking medical insurer reimbursement of the product
in private hospitals, and seeking government reimbursement to enable usage
of the product in public hospitals.
Prior to the initiation of sales in South Africa, over 350 patients
were treated with Hemopure previously supplied without charge as part of a
post-approval medical education program. The information Biopure has gained
about how doctors perceive and use the product has contributed to the
company's planning for larger markets and development of other potential
indications. Anecdotal evidence in these cases of the product's ability to
deliver oxygen to ischemic tissue has contributed to the company's current
focus on cardiac and peripheral limb ischemia, described above.
In the U.S., the Navy's proposed "RESUS" Phase 2/3 trial of Hemopure
for out-of-hospital treatment of trauma patients in hemorrhagic shock,
currently on clinical hold at the Food and Drug Administration (FDA), was
scheduled to be discussed at a meeting of the FDA Blood Products Advisory
Committee on July 14, 2006. The FDA cancelled that meeting, and the company
expects it to be rescheduled.
FY2006 Fourth Quarter and Year-End Financial Results
Biopure expects to issue a press release announcing its financial
results for the fourth fiscal quarter and fiscal year ending October 31,
2006, on Thursday, December 14, 2006.
Biopure Corporation
Biopure Corporation develops, manufactures and markets pharmaceuticals,
called oxygen therapeutics, that are intravenously administered to deliver
oxygen to the body's tissues. Hemopure(R) [hemoglobin glutamer -- 250
(bovine)], or HBOC-201, is approved for sale in South Africa for the
treatment of surgical patients who are acutely anemic. Biopure has applied
in the United Kingdom for regulatory approval of a proposed orthopedic
surgical anemia indication. The company is developing Hemopure for a
potential indication in cardiovascular ischemia, in addition to supporting
the U.S. Naval Medical Research Center's government-funded efforts to
develop a potential out-of-hospital trauma indication. The company's
veterinary product Oxyglobin(R) [hemoglobin glutamer -- 200 (bovine)], or
HBOC-301, the only oxygen therapeutic approved by the U.S. Food and Drug
Administration and the European Commission, is indicated for the treatment
of anemia in dogs. To date, Biopure has sold approximately 177,000 units of
Oxyglobin, which have been used to treat an estimated 90,000 animals.
The content of this press release does not necessarily reflect the
position or the policy of the U.S. Government or the Department of Defense,
and no official endorsement should be inferred.
Statements in this press release that are not strictly historical are
forward-looking statements, including any that might imply that the Navy's
proposed RESUS clinical trial will be allowed to proceed, that clinical
trials of Hemopure will have expected outcomes, that Hemopure will receive
marketing approval in Europe or the U.S. or that Biopure will realize
significant sales revenues. Closing of the financing described above is
subject to customary conditions, many of which are outside Biopure's
control. If all conditions are not satisfied or waived, Biopure may not
receive any money. Actual results and their timing may differ materially
from those projected in these forward-looking statements due to risks and
uncertainties. These risks include, without limitation, uncertainties
regarding the company's financial position, unexpected costs and expenses,
delays and determinations by regulatory authorities, unanticipated problems
with the product's commercial use, whether or not product related, and with
product distributors, sales agents or other third parties, and delays in
clinical trials. The company undertakes no obligation to release publicly
the results of any revisions to these forward-looking statements to reflect
events or circumstances arising after the date hereof. A full discussion of
the company's operations and financial condition can be found in the
company's filings with the U.S. Securities and Exchange Commission,
including under the heading "Risk Factors" in the Form 10-Q filed on June
9, 2006, which can be accessed in the EDGAR database at the SEC Web site,
http://www.sec.gov.
* From Grant DAMD17-02-1-0697. The U.S. Army Medical Research
Acquisition Activity, 820 Chandler Street, Fort Detrick MD 21702-5014, is
the awarding and administering acquisition office.
BIOPURE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
Three Months Ended Nine Months Ended
July 31 July 31
2006 2005 2006 2005
Total revenues $396 $483 $1,284 $1,782
Cost of revenues 2,939 3,166 9,351 9,139
Gross loss (2,543) (2,683) (8,067) (7,357)
Operating expenses:
Research and
development 1,772 1,268 5,112 4,178
Sales and marketing 197 143 524 373
General and
administrative 2,239 2,412 6,826 8,896
Total operating expenses 4,208 3,823 12,462 13,447
Loss from operations (6,751) (6,506) (20,529) (20,804)
Other income, net 127 128 356 312
Net loss $(6,624) $(6,378) $(20,173) $(20,492)
Basic and diluted net
loss per common share $(0.16) $(0.26) $(0.55) $(0.94)
Weighted-average common
shares outstanding 41,616 24,359 36,695 21,716
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
July 31, 2006 October 31, 2005
Assets
Total current assets $11,284 $15,575
Net property and equipment 23,326 26,000
Other assets 819 860
Total assets $35,429 $42,435
Liabilities and stockholders' equity
Total current liabilities $4,547 $4,052
Deferred revenue, net of current portion 1,079 987
Restructuring costs, net of current portion 89 221
Other long term liabilities 41 41
Total liabilities 5,756 5,301
Total stockholders' equity 29,673 37,134
Total liabilities and stockholders' equity $35,429 $42,435
Contact: Douglas Sayles Herb Lanzet (Investors)
Biopure Corporation H.L. Lanzet Inc.
(617) 234-6826 (212) 888-4570
IR@biopure.com lanzet@aol.com
SOURCE Biopure Corporation
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Related links:
http://www.biopure.com
http://www.prnewswire.com/comp/131224.html /
CONTACT:
Douglas Sayles of Biopure Corporation,
+1-617-234-6826, IR@biopure.co; or Investors: Herb Lanzet of H.L.
Lanzet Inc., +1-212-888-4570, lanzet@aol.com
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