HAYWARD, Calif., Nov. 1 /PRNewswire-FirstCall/ -- Aradigm Corporation today announced financial results for the third quarter and nine months ended September 30, 2005.
The company reported contract revenues for the three months ended September 30, 2005 of $719,000 compared to $6.4 million for the same period in 2004. Contract revenues for the nine months ended September 30, 2005 were $9.6 million compared with $20.1 million for the same period in 2004. This decrease for the three and nine months is due to the closing of the restructured license agreement with Novo Nordisk on the AERx Diabetes Management System in January 2005. Revenues for the nine months ended September 30, 2005, were derived from currently partnered AERx development programs. Total operating expenses for the three months ended September 30, 2005 were $8.8 million compared to $14.6 million for the same period in 2004. For the nine months ended September 30, 2005, total operating expenses were $29.1 million compared with $43.6 million for the same period in 2004. The decrease in operating expenses for the three and nine months is tied to the shifting of manufacturing costs associated with the AERx Diabetes Management System with the closing of the restructured license agreement with Novo Nordisk.
The company reported net loss for the three months ended September 30, 2005 of $7.7 million, or $0.11 per share, compared with a net loss of $8.2 million, or $0.13 per share, for the same period in 2004. The net loss for the nine months ended September 30, 2005 was $18.5 million, or $0.26 per share, compared with a net loss of $23.4 million, or $0.37 per share, for the same period in 2004. As we previously communicated, the cash used in operations during the first three quarters of 2005 is higher than previous quarters reflecting an increased spending tied to the commercialization efforts on the Intraject Sumatriptan program.
Capital expenditures for the quarter ended September 30, 2005 were $1.5 million, a majority of which represented scheduled purchases related to Intraject commercial production equipment and validation services.
As of September 30, 2005, cash, cash equivalents and short-term investments totaled approximately $36.7 million.
Recent Highlights
-- In September 2005, the company announced the signing of an intellectual property access agreement with a global pharmaceutical company in the area of smoking cessation. This agreement grants this company access to Aradigm’s strong intellectual property position related to an inhalation system that delivers reducing doses of nicotine, as a liquid or powder aerosol, into the bloodstream via the deep lung. Specific financial terms of the agreement were undisclosed.
-- Last week, the company announced a development and commercialization agreement with United Therapeutics for a liposomal formulation of treprostinil as a treatment of pulmonary arterial hypertension. Treprostinil is an approved and marketed prostacyclin analogue and this partnership will study this formulation for delivery using our AERx System. The agreement contains undisclosed commercial terms including development fees, milestone payments and royalties upon commercialization. The program will be fully funded by United Therapeutics.
“During the quarter, great progress was made in expanding our AERx pipeline with two significant partnerships and executing key tasks to advance our lead program, Intraject Sumatriptan, towards its targeted commercial launch in 2007,” said Dr. Bryan Lawlis, Aradigm’s President and CEO. “These AERx collaborations clearly demonstrate the value of the technology itself, the strong surrounding intellectual property and the value of the unique delivery parameters brought to the compound or drug. With our pipeline expanding and programs progressing in clinical development, and with the advancement of liposomal ciprofloxacin in CF infections, Aradigm is pursuing a path towards becoming a product-oriented company.”
Conference Call
The company will host a conference call and question and answer session today at 4:30 p.m. Eastern Time, 1:30 pm Pacific Time today to discuss these financial results. Dial toll-free 1-877-788-8790 to access the conference call. International callers dial +1-706-679-7281. The event webcast can be found under the investor relations section of the company’s website: www.aradigm.com. The webcast and audio replay of the conference call will be available following the call, and can be accessed on www.aradigm.com or by dialing toll-free 1-800-642-1687. International callers should dial +1-706-645-9291. The replay passcode is 1567451#.
Aradigm develops non-invasive delivery systems to enable patients to comfortably self-administer biopharmaceuticals and small molecules. The company’s advanced AERx(R) pulmonary and Intraject(R) needle-free delivery technologies offer rapid delivery solutions for liquid drug formulations. Current development programs focus on neurological disorders, heart disease, respiratory conditions, smoking cessation, and diabetes. More information about Aradigm can be found at www.aradigm.com.
Except for the historical information contained herein, this news release contains forward-looking statements that involve risk and uncertainties, including clinical results, the timely availability and acceptance of new products, the impact of competitive products and pricing, and the management of growth, as well as the other risks detailed from time to time in Aradigm Corporation’s Securities and Exchange Commission (SEC) Filings, including the company’s Annual Report on Form 10-K, and quarterly reports on Form 10-Q.
NOTE: AERx and Intraject are registered trademarks of Aradigm. Contact: Christopher Keenan Aradigm 510-265-9370 ARADIGM CORPORATION CONDENSED STATEMENTS OF OPERATIONS (In thousands, except per share information) (Unaudited) THREE MONTHS ENDED NINE MONTHS ENDED SEPT 30, SEPT 30, 2005 2004 2005 2004 Contract revenues - From related parties $200 $5,918 $7,911 $19,534 Contract revenues - Other 519 434 1,734 539 Total Contract revenues 719 6,352 9,645 20,073 Operating expenses: Research and development 6,471 11,407 20,858 34,706 General and administrative 2,326 3,217 8,274 8,920 Total operating expenses 8,797 14,624 29,132 43,626 Loss from operations (8,078) (8,272) (19,487) (23,553) Interest income 342 45 980 160 Interest expense 8 (3) (37) (18) Net loss $(7,728) $(8,230) $(18,544) $(23,411) Basic and diluted net loss per share $(0.11) $(0.13) $(0.26) $(0.37) Shares used in computing basic and diluted net loss per share 72,590 63,564 72,484 63,350 ARADIGM CORPORATION CONDENSED BALANCE SHEETS (In thousands) Sept 30, December 31, 2005 2004 (Unaudited) * ASSETS Current assets: Cash, cash equivalents and short-term investments $36,724 $16,763 Receivables 286 99 Current portion of notes receivable from officers and employees 62 67 Other current assets 973 1,602 Total current assets 38,045 18,531 Property and equipment, net 9,192 60,555 Noncurrent portion of notes receivable from officers and employees 162 216 Other assets 550 439 Total assets $47,949 $79,741 LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK AND SHAREHOLDERS’ EQUITY Current liabilities: Accounts payable $1,494 $2,469 Accrued clinical and cost of other studies 289 293 Accrued compensation 3,405 2,984 Deferred revenue 270 7,525 Other accrued liabilities 347 1,138 Total current liabilities 5,805 14,409 Noncurrent portion of deferred revenue -- 3,966 Noncurrent portion of deferred rent 660 1,943 Redeemable convertible preferred stock 23,669 23,669 Shareholders’ equity 17,815 35,754 Total liabilities, redeemable convertible preferred stock and shareholders’ equity $47,949 $79,741
* The balance sheet at December 31, 2004 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements.
Aradigm Corporation
CONTACT: Christopher Keenan of Aradigm Corporation, +1-510-265-9370
Web site: http://www.aradigm.com/
