Transgene . (NASDAQ:TRGNY)
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Transgene Announces Second Quarter and First Half 2004 Financial
Results
STRASBOURG, France, Aug. 4 /PRNewswire-FirstCall/ -- Transgene (Nasdaq: TRGNY;
Nouveau Marche: FR0005175080) today announced financial results for the second
quarter ended June 30, 2004.
Transgene had total revenues of euro 0.4 million (US$ 0.5 million) in the
second quarter of 2004, the same as for the second quarter of 2003. For the
first six months of 2004, revenues were euro 1.0 million (US$ 1.2 million),
compared to euro 1.3 million (US$ 1.6 million) for the same period in 2003. In
the first quarter of 2003, Transgene recorded the upfront payment related to
the license agreement signed with Merck & Co., Inc. After completion of
quality controls, revenues from the EUROVAC manufacturing work performed in the
second quarter 2004 are expected to be recognized in the second half of 2004.
Operating expenses decreased by euro 0.2 million (US$ 0.2 million) to euro 5.7
million (US$ 6.9 million) for the second quarter of 2004 compared to euro 5.9
million (US$ 7.2 million) for the second quarter of 2003. Clinical expenses
were lower due to a decrease in the number of patients recruited in the second
quarter of 2004 compared to the same period in 2003. Patient recruitment is
now complete for most of the on-going Phase II clinical trials. General and
administrative costs also decreased by euro 0.1 million (US$ 0.1 million). For
the first six months of 2004, operating expenses were unchanged at euro 12.0
million (US$ 14.6 million).
Interest and other income was euro 0.1 million (US$ 0.1 million) in the second
quarter 2004 compared to euro 0.3 million (US$ 0.4 million) in the same period
of 2003, due to lower cash and cash equivalent held and lower interest rates.
Transgene recorded a net loss of euro 5.1 million (US$ 6.2 million), or euro
0.51 (US$ 0.62) per share, for the second quarter of 2004 compared to a net
loss of euro 5.2 million (US$ 6.3 million), or euro 0.51 (US$ 0.62) per share
for the same period in 2003. The net loss for the first six months ended June
30, 2004 was euro 10.7 million (US$ 13 million) or euro 1.06 (US$ 1.29) per
share, compared to euro 10.0 million (US$ 12.2 million), or euro 0.99 (US$
1.21) per share for the same period of 2003.
Net cash expenditures were euro 10.2 million (US$ 12.4 million) for the first
six months of 2004, resulting in cash and cash equivalents totaling euro 24.8
million (US$ 30.2 million) at June 30, 2004. Transgene believes that this
amount will be sufficient to meet its cash requirements for working capital and
capital expenditures through mid-2005.
First Half 2004 Highlights
* Transgene released positive interim data in three phase II trials with
the MVA-MUC1-IL2 cancer vaccine candidate in patients with lung, kidney
and prostate cancer.
In lung cancer, the interim results indicate that 12 out of 18 patients
have benefited from the combination of MVA-Muc1-IL2 vaccination with
chemotherapy. In the sub-group of metastatic disease (14 patients with
stage IV), 11 patients (79%) showed clinical benefit (partial and
stable diseases). Results from the ongoing stage 2 of the study are
expected in the coming months.
In the prostate trial, the interim results showed that the vaccination
with MVA-MUC1-IL2 is biologically active and may decelerate the
progression of the disease.
In kidney, enrollment in this 36-patient study proceeded quickly and
has now completed. Nine out of 21 evaluable patients have had stable
disease and continued their treatment with MVA-Muc1-IL2 monotherapy.
Further data will be available in the coming months.
* Transgene released positive data from the phase II trial with the
MVA-HPV-IL2 cancer vaccine candidate in patients with human papilloma
virus (HPV)-related disease, demonstrating dose-related effect and
safety at the highest dose given.
* Transgene manufactured clinical lots of HIV vaccine candidates in the
frame of EUROVAC (European Vaccine Effort against HIV/AIDS), a European
cluster of 21 laboratories, funded since 2000 by the European Union
under the 5th Framework Programme.
* Transgene and Merial Limited announced a collaboration to develop
products for animal health indications using Transgene's vector
platform. Under the terms of the agreement, Transgene will provide
Merial with research and development support regarding vector-based
expression of certain genes selected by Merial.
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 that
has completed Phase I clinical trial. Transgene's proprietary vector
technology platform consists of adenovirus and poxvirus.
This press release contains forward-looking statements, including statements
regarding Transgene's revenues, capital requirements, manufacturing
capabilities 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 assumptions
which are difficult to predict. Accordingly, actual outcomes and results may
differ materially from what is expressed in those forward-looking statements.
Important factors which 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's products are in early stage clinical trials
and the favorable results of some of the trials may not be indicative of
broader results for a large number of humans; 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 most recent fiscal year 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 = $ 1.2179, the noon buying rate of the Federal
Reserve Bank of New York on June 30, 2004.
Condensed Consolidated Balance Sheets
(US GAAP)
(Amounts in thousands) June 30, December 31,
2004 2004 2003
US$ euro euro
(Unaudited) (Audited)
ASSETS
Cash and cash equivalents 30 192 24 790 34 940
Other current assets 2 457 2 017 2 522
32 648 26 807 37 462
Property, plant and
equipment, net 9 301 7 637 8 034
Other assets 391 321 322
42 340 34 765 45 818
LIABILITIES AND SHAREHOLDERS'
EQUITY
Total current liabilities 5 937 4 875 5 301
Total long-term liabilities 7 211 5 921 5 998
Total shareholders' equity 29 192 23 969 34 519
42 340 34 765 45 818
Condensed Consolidated Statements of Operations
US GAAP
(Amounts in thousands
except share and per
share data)
Three months ended June 30, Six month ended June 30,
2004 2004 2003 2004 2004 2003
US$ euro euro US$ euro euro
(Unaudited) (Unaudited)
Revenues
Revenues from
collaborative
and licensing
agreements 529 434 423 1 202 987 1 319
Grants received
for research
and development 0 0 0 0 0 0
Total
revenues 529 434 423 1 202 987 1 319
Operating
expenses
Research and
devel-
opment (5 683) (4 666) (4 725) (12 279) (10 082) (9 899)
General &
administra-
tive (1 236) (1 015) (1 146) (2 290) (1 880) (2 065)
Restructuring 0 0 0 0 0 0
Total opera-
ting
expenses (6 919) (5 681) (5 871) (14 569) (11 962) (11 964)
Loss from
opera-
tions (6 390) (5 247) (5 448) (13 367) (10 975) (10 645)
Interest and
other income,
net 166 136 289 415 341 646
Income tax
benefit (21) (17) 0 (21) (17) 0
Net loss (6 245) (5 128) (5 159) (12 972) (10 651) (9 999)
Loss per
ordinary
share (0.62) (0.51) (0.51) (1.29) (1.06) (0.99)
Weighted
average
number of
shares
outstand-
ing 10 055 760 10 055 760 10 055 760 10 055 760 10 055 760 10 055 760
Loss per
ADS
(American
Depositary
Share) (0.21) (0.17) (0.17) (0.43) (0.35) (0.33)
Weighted
average
number
of ADSs
outstand-
ing 30 167 280 30 167 280 30 167 280 30 167 280 30 167 280 30 167 280
Notes: 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 = $ 1.2179,
the noon buying rate of the Federal Reserve Bank of New York on
June 30, 2004. The 2003 accounts have been restated to SFAS 123
"Accounting for Stock based Compensation."
During the second quarter of 2004, Transgene reviewed revenue recognition from
a certain manufacturing contract and concluded that the euro 0.653 million
revenues reported in the first quarter of 2004 should be reduced by euro 0.100
million, down to euro 0.553 million. As a result of this change, net loss
should be euro 5.523 million, compared to the previously reported euro 5.423
million. Consolidated balance sheet and statement of operations for the
quarter ended March 31, 2004 have been restated accordingly, as shown below:
Condensed Consolidated Balance Sheets
(US GAAP)
(Amounts in thousands ) March 31,
2004 2004
US$ euro
(Unaudited)
ASSETS
Cash and cash equivalents 36 404 29 616
Other current assets 3 059 2 489
Total current assets 39 463 32 105
Property, plant and equipment, net 9 626 7 831
Other assets 256 208
Total assets 49 345 40 144
LIABILITIES AND SHAREHOLDERS' EQUITY
Total current liabilities 6 316 5 138
Total long-term liabilities 7 325 5 959
Total shareholders' equity 35 705 29 047
Total liabilities and shareholders' equity 49 345 40 144
Condensed Consolidated Statements of Operations
US GAAP
(Amounts in thousands
except share and per
share data) Three months ended March 31,
2004 2004 2003
US$ euro euro
(Unaudited)
Revenues
Revenues from collaborative
and licensing agreements 680 553 896
Grants received for research
and development 0 0 0
Total revenues 680 553 896
Operating expenses
Research and development (6 657) (5 416) (5 174)
General & administrative (1 063) (865) (919)
Restructuring 0 0 0
Total operating expenses (7 721) (6 281) (6 093)
Loss from operations (7 041) (5 728) (5 197)
Interest and other
income, net 252 205 357
Income tax benefit 0 0 0
Net loss (6 789) (5 523) (4 840)
Loss per ordinary share (0.68) (0.55) (0.48)
Weighted average number
of shares outstanding 10 055 760 10 055 760 10 055 760
Loss per ADS (American
Depositary Share) (0.23) (0.18) (0.16)
Weighted average number of
ADSs outstanding 30 167 280 30 167 280 30 167 280
Notes: 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 = $ 1.2292, the noon
buying rate of the Federal Reserve Bank of New York on March 31, 2004.
The 2003 accounts have been restated to SFAS 123 "Accounting for Stock
based Compensation."
DATASOURCE: Transgene
CONTACT: Philippe Poncet, Chief Financial Officer of Transgene,
+33-3-88-27-91-21; or Michael Long of Cohn & Wolfe, +1-212-798 9775; or
Estelle Guillot-Tantay, +33-1-53-70-74-93, or Laurence Heilbronn,
+33-1-53-70-74-64, both of Image 7, all for Transgene
Web site: http://www.transgene.fr/