Transgene . (NASDAQ:TRGNY)
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Transgene Announces Fourth Quarter and Fiscal Year 2003 Financial Results
STRASBOURG, France, Feb. 11 /PRNewswire-FirstCall/ -- Transgene (Nasdaq: TRGNY;
Euronext: FR0005175080) today announced results for the fourth quarter and
fiscal year ended December 31, 2003.
Quarterly results
Revenues decreased euro 1 million (US$ 1.3 million) to euro 0.6 million (US$ 0.8
million) in the fourth quarter 2003, compared to euro 1.6 million (US$ 2
million) in the fourth quarter 2002. In 2002, all revenues from the Association
Francaise contre les Myopathies ("AFM") were recorded in the fourth quarter.
Accounting rules did not permit Transgene to record these amounts until after
the AFM Agreement was renewed in December 2002. On a comparable basis, revenues
in the fourth quarter of 2002 were euro 0.6 million (US$ 0.8 million), same as
in 2003.
Research and development costs increased euro 0.2 million (US$ 0.3 million) in
the fourth quarter 2003 compared to the same period of 2002. Clinical trials and
manufacturing costs increased euro 0.6 million (US$ 0.8 million), whereas
research and intellectual property costs decreased euro 0.4 million (US$ 0.5
million).
General & administrative costs increased euro 0.4 million (US$ 0.5 million) in
the fourth quarter of 2003 compared to the same period of 2002, primarily
reflecting higher business development, communication & legal expenses and
mostly-non-recurring accruals.
Due to lower cash-on-hand and interest rates, interest income was euro 0.2
million (US$ 0.3 million) in the last quarter of 2003 compared to euro 0.5
million (US$ 0.6 million) in the last quarter of 2002.
As a result, Transgene reported a net loss for the fourth quarter 2003 of euro
6.5 million (US$ 8.1 million) compared to a net loss of euro 4.7 million (US$
5.9 million) in the fourth quarter 2002.
Fiscal year ended December 31, 2003
For the year ended December 31, 2003, Transgene reported total revenues of euro
2.5 million (US$ 3.2 million) compared to euro 2.2 million (US$ 2.8 million) for
the fiscal year ended December 31, 2002. The increase is primarily attributable
to contracts signed in 2003 with Merck & Co., Inc. (licensing-out) and the
International AIDS Vaccine Initiative (manufacturing of preclinical lots),
partially offset by a decrease of AFM revenues.
Operating expenses were euro 24.4 million (US$ 30.7 million) in 2003 compared to
euro 22.7 million (US$ 28.6 million) in 2002. While a reduction in research and
intellectual property expenses was observed, the increasereflects the expansion
of the 2003 clinical trials program (149 patients enrolled in 2003 compared to
115 in 2002) and higher activity in Transgene's manufacturing plant and related
controls. The balance of the restructuring provision was totally reversed in
2003, of which 0.1 million (US$ 0.1 million) corresponded to an unused portion.
Due to lower cash-on-hand and interest rates, interest income was halved in 2003
(euro 1.1 million or US$ 1.3 million) compared to 2002 (euro 2 million or US$
2.5 million).
Transgene reported a net loss of euro 20.9 million (US$ 26.3 million), or euro
2.08 (US$ 2.62) per share, in 2003, compared to a net loss of euro 18.6 million
(US$ 23.3 million), or euro 1.84 (US$ 2.32) per share, in 2002.
Cash expenditures in2003 amounted to euro 19.6 million (US$ 24.6 million)
compared to euro 17.3 million (US$ 21.8 million) in 2002, reflecting primarily
higher 2003 operating expenditures. Additionally, in comparison to 2002, the
2003 cash expenditures have been negatively impacted by a lower refund of
research & development tax credit (impact of euro 1.3 million or US$ 1.6
million) and lower interest income (impact of euro 0.9 million or US$ 1.1
million). The above negative impacts have been partially offset by lower
restructuring payments in 2003 (impact of euro 1 million or US$ 1.3 million),
additional contracts revenues (impact of euro 0.3 million or euro 0.4 million)
and favorable working capital evolution (impact of euro 0.5 million or US$ 0.6
million).
At December 31, 2003, Transgene had euro 34.9 million (US$ 44 million) in cash
and cash equivalents. Transgene believes that this amount will be sufficient to
meet its cash requirements for working capital and capital expenditures through
mid-2005.
"We are encouraged by the substantial progress made in our clinical programs in
2003. We are entering an exciting period in the cancer vaccine and immunotherapy
fields and are looking forward to further development of our product candidates
in 2004," stated Jean-Francois Carmier, chief executive officer of Transgene.
2003 highlights:
In 2003, Transgene's four cancer product candidates (MVA-Muc1-IL2 and
MVA-HPV-IL2 in Phase II, Ad-IFNy and Ad-IL2 in Phase I/II) generated clinical
data supporting further specific development. Transgene pursued the development
of MVA-HPV-IL2 and Ad-IFNy in monotherapy settings for early stage diseases, and
MVA-Muc1-IL2 and Ad-IL2 in combination with chemotherapy for advanced cancers.
Additional positive Phase II interim data of MVA-Muc1-IL2 cancer vaccine were
released on February 9th, 2004.
Transgene presented positive Phase I/II data on its Ad-IFNy product candidate in
cutaneous lymphoma at the American Society of Gene Therapy Annual Meeting and
announced that Ad-IFNy received orphan drug designation in Europe.
In June 2003, the AFM and Transgene released results of the Phase I gene therapy
trial on Duchenne and Becker muscular dystrophies at the American Society of
Gene Therapy Annual Meeting.
In September 2003, Transgene announced the decision to commence clinical
development of its anti-cancer product candidate MVA-FCU1, a virus-directed
enzyme-prodrug therapy which is designed to cause the production of a
chemotherapeutic drug locally, within the tumor.
Transgene, based in Strasbourg, France, is a biopharmaceutical company dedicated
to the discovery and development of therapeutic vaccines, immunotherapy
products, and delivery technologies for the treatment of diseases for which
there is no cure or adequate treatment at present, with a focus on the treatment
of cancer. Transgene has five products in clinical development, two of which
are in Phase II clinical trials, two in Phase I/II and one which has completed
Phase I clinical trial. Transgene's proprietary vector technology platform
consists of adenovirus, poxvirus and non-viral vectors.
This press release contains forward-looking statements, including statements
regarding Transgene's revenues, capital requirements and prospects. Statements
that are not historical facts are based on Transgene's current expectations,
beliefs, estimates, forecasts and assumptions. The statements contained in this
release are not guarantees of future performance and involve certain risks,
uncertainties and assumptionswhich are difficult to predict. Accordingly,
actual outcomes and results may differ materially from what is expressed in
those forward-looking statements. Important factors that may affect Transgene's
future operating results include the following: Transgene has a history of
operating losses; it may not have sufficient resources or may fail to obtain the
capital necessary to complete the research and commercialization of any of its
product candidates; Transgene may be unable to conduct its clinical trials as
quickly as it has predicted; Transgene's clinical trials may not produce results
sufficient to justify further product development; Transgene's product
candidates may not demonstrate therapeutic efficacy; Transgene may be unable to
obtain regulatory approval for its product candidates; Transgene's patent and
proprietary rights may not provide it with any benefit and the patents of others
may prevent it from commercializing its products; proceedings to obtain patents
and litigation of third party infringement claims are expensive and could limit
its patent and proprietary rights; competitors may develop technologies or
products superior to Transgene's technologies or products; and other important
factors described in Transgene's Annual Report on Form 20-F for the year ended
December 31, 2002 filed with the U.S. Securities and Exchange Commission,
including those factors described in the section entitled "Risk Factors."
Note: The official financial information of Transgene is stated in Euros. The
financial information expressed in US$ is translated solely for the convenience
of the reader at euro 1.00 = $ 1.2597, the noon buying rate of the Federal
Reserve Bank of New York on December 31, 2003.
Condensed Consolidated Balance Sheets
(US GAAP)
(Amounts in thousands ) December 31, December 31,
2003 2003 2002
US$ euro euro
(Unaudited) (Audited)
ASSETS
Cash and cash equivalents 44,014 34,940 54,491
Other current assets 2,985 2,370 3,207
Total current assets 46,999 37,310 57,698
Property, plant and equipment, net 10,120 8,034 8,666
Other assets 406 322 516
Total assets 57,525 45,666 66,880
LIABILITIES AND SHAREHOLDERS' EQUITY
Total current liabilities 6,448 5,119 5,277
Total long-term liabilities 7,593 6,028 6,396
Total shareholders'equity 43,484 34,519 55,207
Total liabilities and
shareholders' equity 57,525 45,666 66,880
Condensed Consolidated Statements of Operations
US GAAP
(Amounts in thousands except share
and per share data) Three months ended
December 31,
2003 2003 2002
US$ euro euro
(Unaudited)
Revenues
Revenues from collaborative and
licensing agreements 736 584 1,763
Grants received for research and
development 53 42 (168)
Total revenues 789 626 1,595
Operating expenses
Research and development (7,383) (5,861) (5,719)
General & administrative (1,789) (1,420) (1,007)
Restructuring 4 3 46
Total operating expenses (9,168) (7,278) (6,680)
Loss from operations (8,380) (6,652) (5,085)
Interest and other income, net 244 194 454
Income tax benefit 0 0 (39)
Net loss (8,135) (6,458) (4,670)
Loss per ordinary share (0.81) (0.64) (0.46)
Weighted average number of shares
outstanding 10,055,760 10,055,760 10,055,760
Loss per ADS
(American Depositary Share)(0.27) (0.21) (0.15)
Weighted average number of ADSs
outstanding 30,167,280 30,167,280 30,167,280
US GAAP
(Amounts in thousands except share
and per share data) Twelve months ended
December 31,
2003 2003 2002
US$ euro euro
(Unaudited) (Audited)
Revenues
Revenues from collaborative and
licensing agreements 3,098 2,459 2,197
Grants received for research and
development 53 42 9
Total revenues 3,151 2,501 2,206
Operating expenses
Research and development (25,518) (20,257) (19,149)
General & administrative (5,384) (4,274) (3,616)
Restructuring 118 94 46
Total operating expenses (30,783) (24,437) (22,719)
Loss from operations (27,633) (21,936) (20,513)
Interest and other income, net 1,337 1,061 2,012
Income tax benefit 0 0 (39)
Net loss (26,296) (20,875) (18,540)
Loss per ordinary share (2.62) (2.08) (1.84)
Weighted average number of shares
outstanding 10,055,760 10,055,760 10,055,760
Loss per ADS
(American Depositary Share) (0.87) (0.69) (0.61)
Weighted average number of ADSs
outstanding 30,167,280 30,167,280 30,167,280
Notes:
The December 31, 2003 and December 31, 2002 balance sheets and profit & loss
statements have been restated to reflect the retroactive adoptionof the fair
value recognition provisions of SFAS 123, Accounting for Stock Based
Compensation.
For comparability between 2003 and 2002 an expense of euro 0.137 million (US$
0.173 million) in the fourth quarter of 2002 has been reclassified from
"Interest & Other Income" to "General and Administrative expenses."
The official financial information of Transgene is stated in Euros. The
financial information expressed in US$ is translated solely for the convenience
of the reader at euro 1.00 = $ 1.2597,the noon buying rate of the Federal
Reserve Bank of New York on December 31, 2003.
DATASOURCE: Transgene
CONTACT: Philippe Poncet, Chief Financial Officer of Transgene,
+33-3-88-27-91-02; or Julio Cantre of Cohn & Wolfe, +1-212-798-9779; or
Estelle Guillot-Tantay, +33-1-53-70-74-93, or Laurence Heilbronn,
+33-1-53-70-74-64, both of Image7, all for Transgene