CARLSBAD, Calif., Nov. 14 /PRNewswire/ -- The Immune Response Corporation
(Nasdaq: IMNR) today announced its financial results for the quarter ended
September 30, 2001. The net income for the third quarter of 2001 was
$1.4 million or $.04 per share, compared to a net loss of $5.2 million or a
loss of $.19 per share, reported in the third quarter of 2000. The net income
for the third quarter of 2001 resulted from recognition of the deferred
revenue of approximately $7.7 million associated with the termination of the
development agreement with Agouron Pharmaceuticals, Inc., a Pfizer Inc.
company.
For the nine months ended September 30, 2001, the Company reported a net
loss of $8.8 million, or $.27 per share, compared to a net loss of
$22.0 million, or $.82 per share reported for the nine months ended September
30, 2000. The results for the nine months ended September 30, 2000 reflect
the implementation of the Staff Accounting Bulletin No. 101, "Revenue
Recognition in Financial Statements," (SAB 101), which the SEC issued in
December 1999.
Research related revenue for the quarter ended September 30, 2001 was
$7.8 million compared to $1.1 million for the same quarter in 2000. For the
nine months ended September 30, 2001 and for the same period of 2000, revenues
were $9.9 million and $6.3 million, respectively. The increase in research
revenue in 2001 was primarily related to the timing of revenues recognized,
per the provisions of SAB 101, under our agreement with Pfizer, entered into
in June 1998 and terminated in July 2001.
The Company implemented SAB 101 in the fourth quarter of 2000 by restating
the first, second and third quarters of its 2000 financial statements. The
statement of operations reflects a one-time charge to earnings of
$13.2 million for the cumulative effect of the change in accounting principle
as of January 1, 2000. Deferred revenue recognized, to reflect the
application of the SAB No. 101 restatement adjustments, was $960,000, $968,000
and $968,000 for the first, second and third quarters of 2000, respectively.
Deferred revenue of $968,000 per quarter was recognized in the first and
second quarters of 2001 based on the expected development period, which was
estimated to be through June 2003. Due to the termination of the development
agreement with Pfizer, the remaining deferred revenue of approximately
$7.7 million was recognized as revenue during the third quarter of 2001.
In addition to research related revenue, the Company received non-research
revenue from investment and other income of $833,000 for the nine months ended
September 30, 2001 versus $4.1 million for the same period in 2000. This
decrease in investment and other income in 2001 was due primarily to fewer
sales in 2001 of equity securities acquired by the Company through the
licensing of technology and from the sale of undeveloped property in 2000.
Operating expenses increased to $19.4 million for the nine months ended
September 30, 2001 from $19.2 million in the first nine months of 2000. The
increase in operating expenses was due primarily to spending on the scale-up
of the manufacturing process of REMUNE(R) and higher professional fees in the
nine months ended September 30, 2001.
Cash, cash equivalents and short-term investments were $6.0 million at
September 30, 2001 compared with $28.4 million at the end of 2000. In
November 2001, the Company raised $2.0 million in a private placement of a
secured convertible note and warrant to a director and major stockholder of
the Company.
The Immune Response Corporation is a biopharmaceutical company based in
Carlsbad, California, developing immune-based therapies to induce specific
immune responses for the treatment of HIV, autoimmune diseases and cancer. In
addition, the Company is developing a targeted, non-viral delivery technology
for gene therapy, which is designed to enable the delivery of genes directly
to the liver via intravenous injection.
NOTE: Company information can also be located on the Internet Web Site:
http://www.imnr.com .
This news release contains forward-looking statements. Actual results
could vary materially from those expected due to a variety of risk factors,
including the uncertainty of successful completion of clinical trials, and
those risks set forth from time to time in The Immune Response Corporation's
SEC filings, including but not limited to its report on Form 10-K for the year
ended December 31, 2000 and subsequent Forms 10-Q. The Company undertakes no
obligation to publicly release the result of any revisions to these forward-
looking statements, which may be made to reflect events or circumstances after
the date hereof or to reflect the occurrence of unanticipated events.
The Immune Response Corporation
Condensed Consolidated Statements of Operations
(Amounts in thousands, except share data)
(unaudited)
Three months ended Nine months ended
September 30, September 30,
2001 2000 2001 2000
(Restated) (Restated)
Research revenue $7,787 $1,076 $9,855 $6,316
Expenses:
Research and development 5,006 5,649 15,271 15,841
General and administrative 1,398 1,207 4,173 3,361
6,404 6,856 19,444 19,202
Other income and expense:
Equity in loss of investee (64) -- (123) --
Investment income, net 99 611 949 3,400
Other income, net 1 -- 7 736
Income (loss) before
cumulative effect of
accounting change 1,419 (5,169) (8,756) (8,750)
Cumulative effect of
accounting change -- -- -- (13,212)
Net income (loss) 1,419 (5,169) (8,756) (21,962)
Preferred stock items -- (258) (334) (771)
Net income (loss) applicable
to common stockholders $1,419 $(5,427) $(9,090) $(22,733)
Net income (loss) per share
- basic and diluted $0.04 $(0.19) $(0.27) $(0.82)
Weighted average common
shares outstanding 35,109,497 28,912,001 33,271,295 27,749,763
Weighted average common
and common equivalent
shares outstanding 35,734,789 28,912,001 33,271,295 27,749,763
The Immune Response Corporation
Condensed Consolidated Balance Sheets
(Amounts in thousands)
September 30, December 31,
2001 2000
(unaudited)
Assets
Cash, cash equivalents and short-term
investments $5,965 $28,356
Other current assets 1,355 607
7,320 28,963
Property and equipment, net 8,512 8,554
Licensed technology 3,708 4,238
Investment in MicroGenomics, Inc. 2,877 3,000
Other assets 849 848
Total assets $23,266 $45,603
Liabilities and stockholders' equity
Current liabilities $4,100 $8,409
Long-term liabilities 1,419 7,765
Redeemable, convertible preferred stock -- 9,907
Stockholders' equity 17,747 19,522
Total liabilities and stockholders' equity $23,266 $45,603
SOURCE The Immune Response Corporation
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Related links:
http://www.imnr.com
Company News On-Call:
http://www.prnewswire.com/comp/434675.html
CONTACT:
Howard Sampson, Vice President, Finance,
Chief Financial Officer and Treasurer of The Immune Response
Corporation, +1-760-431-7080
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