Improved Financial Performance Continues; Stockholders Approve Sale of Nabi
Biologics to Biotest
BOCA RATON, Fla., Nov. 8 /PRNewswire-FirstCall/ -- Nabi
Biopharmaceuticals (Nasdaq: NABI) today announced its third quarter
financial results. The company recorded a net loss of $15.9 million, or
$0.26 per share, for the quarter ended September 29, 2007, which included
$7.5 million, or $0.12 per share, of expenses for unusual items described
below. This was an improvement of 27% when compared to the net loss of
$21.8 million, or $0.36 per share, for the quarter ended September 30,
2006, which included a loss of $5.5 million, or $0.09 per share, from
discontinued operations. Revenues for the third quarter of 2007 were $20.1
million compared to $19.6 million in 2006. Nabi- HB(R) [Hepatitis B Immune
Globulin (Human)] revenues were $7.4 million during the third quarter of
2007 compared to $6.8 million during the third quarter of 2006.
For the nine months ended September 29, 2007, the company's net loss
from continuing operations was $31.9 million, or $0.52 per share, compared
to $45.4 million, or $0.75 per share, for the nine months ended September
30, 2006. Revenues for the year to date period were $64.7 million compared
to $59.5 million in 2006.
Total cash used in operating activities was $22.8 million during the
first nine months of 2007, a 40% reduction compared to $38.0 million in the
same period of 2006. Excluding discontinued operations, cash used in
operating activities was $16.6 million for the nine months ended September
29, 2007, a 48% reduction compared to $31.9 million for same period in
2006. Cash, cash equivalents and marketable securities were $99.8 million
at the end of the third quarter.
Results of Special Meeting of Shareholders
At the Special Meeting of Stockholders held earlier today, the proposal
to sell the Nabi Biologics strategic business unit and certain Corporate
Shared Services (CSS) group assets to Biotest Pharmaceuticals Corporation,
a wholly- owned subsidiary of Biotest AG, was approved by a majority of the
holders of outstanding shares of our common stock who were entitled to
vote. As a result of this approval, the operational results, assets and
liabilities related to Nabi Biologics and certain CSS assets will be
reflected as discontinued operations beginning in the fourth quarter of
2007. Although the closing of the sale remains subject to other closing
conditions, including the expiration of the waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, which
have yet to be satisfied, we anticipate that the closing will occur by the
end of this year.
"The approval by our stockholders of the sale of Nabi Biologics to
Biotest AG earlier today is a major milestone in our strategic alternatives
process and affirms the steps we are taking to deliver shareholder value.
We have remained on-track in 2007, realizing improved financial performance
in each quarter compared to 2006, and we expect to achieve our cost control
and cash utilization targets for the year," said Dr. Leslie Hudson, interim
president and chief executive officer of Nabi Biopharmaceuticals. "In
addition to this financial progress, we are also extremely pleased with the
positive clinical trial results and continued success of our NicVAX
program. We look forward to continuing the successful clinical development
of NicVAX and moving forward with our ongoing and productive partnership
discussions."
Review of Segment Performance
Nabi Biologics
Nabi Biologics revenues were $20.1 million in the third quarter of
2007, which included $15.9 million and $7.4 million in sales of antibody
and Nabi-HB products, respectively, compared to $19.5 million in the third
quarter of 2006. Current period revenues also reflect a $3.3 million charge
related to an unfavorable court ruling that vacated a portion of the $4.5
million awarded to us on February 9, 2007 in an arbitration relating to a
contract manufacturing agreement with Inhibitex, Inc. We will vigorously
challenge this ruling on appeal. Excluding this charge, segment revenues
increased by $3.9 million, or 20%, from the third quarter of 2006. This
increase was driven by a $3.7 million increase in antibody sales
principally from higher sales of Tetanus and Anti-D antibodies.
Nabi Biologics research and development expenses were $10.7 million for
the third quarter ended September 30, 2007, compared to $5.1 million for
the same period last year. This increase reflects the acceleration of
Nabi's IVIG development program along with costs associated with obtaining
the Biologics Licensing Application for Nabi-HB intravenous. We also
recorded a $2.7 million charge in the current quarter in connection with
the termination of future obligations associated with the development of
ATG-Fresenius. Nabi Biologics had an operating loss of $6.4 million for the
three months ended September 29, 2007 compared to an operating loss of $2.7
million for the comparable prior year period.
Nabi Pharmaceuticals
Nabi Pharmaceuticals posted an operating loss of $2.2 million in the
third quarter of 2007 compared to a loss of $5.3 million in the third
quarter of 2006. Research and development costs were $2.2 million for the
three months ended September 29, 2007, compared to $5.1 million for the
same period last year. This decrease reflects lower spending associated
with our Gram-positive programs, including StaphVAX. NicVAX expenses were
also lower in the current quarter as third quarter 2006 expenses included
the initiation of the NicVAX Phase II proof of concept trial. NicVAX
expenses were partially offset by funding from the National Institute on
Drug Abuse of $0.2 million and $1.1 million in the third quarter of 2007
and 2006, respectively.
Corporate Shared Services (CSS)
CSS costs associated with finance, IT, HR, business development and
administration activities totaled $7.8 million for the three months ending
September 29, 2007, compared to $8.4 million for the third quarter in 2006.
This decrease reflects our ongoing efforts to lower infrastructure costs.
Current period expenses include $1.5 million of legal and other
professional fees related to the anticipated sale of the Biologics business
unit announced on September 11, 2007, while the prior period expenses
included expense related to the review of certain stock compensation
awards.
Recent Accomplishments
-- NicVAX Phase 2b 12-month data presented at the American Heart
Association Scientific Sessions on November 7, 2007 continue the
positive trends and findings previously reported, demonstrating NicVAX
efficacy in supporting statistically significant and continuous
abstinence rates by dose as well as by antibody response. These
positive results are the subject of a recent press release, issued Nov.
7, 2007. They support continued development of this product candidate
and underpin on-going partnership discussions.
-- Shareholder approval for the sale of the Nabi Biologics strategic
business unit to Biotest AG, a significant step toward the successful
completion of our strategic alternatives process.
Upcoming Milestones
Nabi is currently working to achieve the following corporate milestones
in 2007:
-- Successfully close the sale of Nabi Biologics and Corporate Shared
Services to Biotest Pharmaceuticals
-- Continue to advance development partnerships for NicVAX and the Gram-
positive programs
Third Quarter Financial Results Conference Call
The company will host a live webcast at 4:30 p.m. EST 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=1673091 (Due to the length of this URL, it may
be necessary to copy and paste this hyperlink into your browser. Remove the
space if one exists.)
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
866-202-4683 and the international call-in number is 617-213-8846. The
participant passcode is 65486127. An audio replay will be available for
U.S./Canada callers at 888-286-8010 and for international callers at
617-801-6888. The replay passcode is 91953104. An archived version of the
webcast will also be available on the Company's website, http://www.nabi.com. Both
the audio replay and the archived webcast will be available through
November 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 and a
state-of-the-art manufacturing capability. The company operates through 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. In September 2007, Nabi
announced that it had entered into a definitive agreement with Biotest AG
to sell the Nabi Biologics strategic business unit to Biotest
Pharmaceuticals Corporation, including Nabi-HB(R) [Hepatitis B Immune
Globulin (Human)], and other plasma business assets, including Nabi's
state-of-the-art plasma protein production plant, and nine FDA-certified
plasma collection centers across the U.S. The acquisition also will include
certain of Nabi's Corporate Shared Services group assets and the company's
Boca Raton, Florida headquarters and other facilities, as well as the
assumption of certain liabilities, and is expected to close by the end of
the year. 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 cost control and
cash utilization targets, the closing of the sale of Nabi Biologics 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: achieve anticipated cost savings and cash
utilization targets; successfully close the sale of the Nabi Biologics SBU
to Biotest AG; 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 quarters ended June 30, 2007 and March 31, 2007 on Form 10-Q with
the Securities and Exchange Commission.
Nabi Biopharmaceuticals
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
September 29, December 30,
2007 2006
Assets
Current assets:
Cash and cash equivalents $78,040 $86,227
Marketable securities 21,725 32,500
Trade accounts receivable, net 14,313 20,377
Inventories, net 18,693 19,260
Prepaid expenses and other current assets 5,036 3,459
Assets of discontinued operations 227 13,341
Total current assets 138,034 175,164
Property, plant and equipment, net 83,083 88,329
Intangible assets, net 1,216 1,683
Other, net 1,521 701
Total assets $223,854 $265,877
Liabilities and stockholders' equity
Current liabilities:
Trade accounts payable $7,323 $7,998
Accrued expenses 20,005 16,095
Capital lease obligations, net 67 291
Liabilities of discontinued operations 3,623 20,554
Total current liabilities 31,018 44,938
2.875% convertible senior notes, net 109,441 109,313
Other liabilities 245 238
Total liabilities 140,704 154,489
Commitments and contingencies
Stockholders' equity:
Convertible preferred stock - -
Common stock 6,190 6,149
Capital in excess of par 330,628 327,228
Treasury stock (5,321) (5,321)
Accumulated deficit (248,347) (216,668)
Total stockholders' equity 83,150 111,388
Total liabilities and stockholders' equity $223,854 $265,877
Nabi Biopharmaceuticals
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share amounts)
For the Three Months Ended For the Nine Months Ended
September 29, September 30, September 29, September 30,
2007 2006 2007 2006
Revenues $20,110 $ 19,634 $ 64,731 $59,525
Cost of products
sold 14,694 15,428 41,181 44,310
Gross margin 5,416 4,206 23,550 15,215
Selling, general and
administrative
expense 8,915 10,366 27,503 33,365
Research and
development expense 12,932 10,240 32,035 27,901
Operating loss (16,431) (16,400) (35,988) (46,051)
Interest income 1,444 908 4,443 2,916
Interest expense (923) (937) (2,727) (2,796)
Other income
(expense), net 9 (54) 2,569 329
Loss from continuing
operations before
income taxes (15,901) (16,483) (31,703) (45,602)
Income taxes - 162 (190) 162
Loss from continuing
operations (15,901) (16,321) (31,893) (45,440)
Net income (loss)
from discontinued
operations 27 (5,492) 212 (9,274)
Net loss $ (15,874) $(21,813) $(31,681) $(54,714)
Basic and diluted
(loss) income per
share:
Continuing
operations $(0.26) $(0.27) $(0.52) $(0.75)
Discontinued
operations 0.00 (0.09) 0.00 (0.15)
Basic and diluted
loss per share $(0.26) $(0.36) $(0.52) $(0.90)
Basic and diluted
weighted average
shares outstanding 61,382 61,185 61,256 60,830
Nabi Biopharmaceuticals
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
For the Nine Months Ended
September 29, September 30,
2007 2006
Cash flow from operating activities:
Loss from continuing operations $(31,893) $(45,440)
Adjustments to reconcile loss from
continuing operations to net cash used
in operating activities from continuing
operations:
Depreciation and amortization 6,115 5,593
Provision for slow moving or obsolete
inventory 239 1,082
Non-cash compensation 2,478 5,007
Gain on sale of assets, net (2,557) -
Loss on disposal of fixed assets, net 44 452
Tax benefit on stock options exercised - (162)
Other 149 (328)
Changes in assets and liabilities:
Trade accounts receivable 6,042 8,473
Inventories (313) (2,513)
Prepaid expenses and other current assets (188) (184)
Other assets 28 146
Accounts payable and accrued expenses 3,242 (4,053)
Total adjustments 15,279 13,513
Net cash used in operating activities from
continuing operations (16,614) (31,927)
Net cash used in operating activities from
discontinued operations (6,187) (6,023)
Net cash used in operating activities (22,801) (37,950)
Cash flow from investing activities:
Purchases of marketable securities (29,475) (68,075)
Proceeds from sales of marketable
securities 40,250 40,322
Proceeds from sale of assets, net of
closing costs 1,300 8
Capital expenditures (784) (2,145)
Net cash provided by (used in) investing
activities from continuing operations 11,291 (29,890)
Net cash provided by investing activities
from discontinued operations 2,582 -
Net cash provided by (used in) investing
activities 13,873 (29,890)
Cash flow from financing activities:
Repayments of capital leases (224) (116)
Proceeds from exercise of employee
stock options 673 1,238
Net cash provided by financing activities
from continuing operations 449 1,122
Net cash provided by (used in) financing
activities from discontinued operations 292 (3,024)
Net cash provided by (used in) financing
activities 741 (1,902)
Net decrease in cash and cash equivalents (8,187) (69,742)
Cash and cash equivalents at beginning of
period 86,227 101,762
Cash and cash equivalents at end of period $78,040 $32,020
Nabi Biopharmaceuticals
SUPPLEMENTAL SEGMENT INFORMATION
(Unaudited)
For the Three Months For the Nine Months
Ended Ended
(In thousands) September 29, September 30, September 29, September 30,
2007 2006 2007 2006
Revenues:
Biologics SBU $20,075 $19,484 $64,689 $58,411
Pharmaceuticals
SBU 35 150 42 1,114
Total $20,110 $19,634 $64,731 $59,525
Gross margin (loss):
Biologics SBU $5,381 $4,170 $23,626 $14,776
Pharmaceuticals SBU 35 36 (76) 439
Total $5,416 $4,206 $23,550 $15,215
Operating loss:
Biologics SBU $(6,437) $(2,714) $(2,999) $(2,021)
Pharmaceuticals
SBU (2,160) (5,309) (9,895) (18,775)
Segment operating
loss (8,597) (8,023) (12,894) (20,796)
CSS (7,834) (8,377) (23,094) (25,255)
Total $(16,431) $(16,400) $(35,988) $(46,051)
SOURCE Nabi Biopharmaceuticals
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Related links:
http://www.nabi.com
CONTACT:
Investor Relations of Nabi
Biopharmaceuticals, +1-301-770-3099
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