MARTINSRIED/MUNICH, Germany, March 15 /PRNewswire-FirstCall/ -- U.S. Research and Development Facilities in Waltham/Boston Mass. and Princeton N.J. -- GPC Biotech AG today reported financial results for the fourth quarter and fiscal year ended December 31, 2005.
Quarter over quarter results: fourth quarter 2005 compared to third quarter 2005
Revenues for the fourth quarter of 2005 increased 33% to euro 2.8 million compared to euro 2.1 million for the previous quarter. Research and development (R&D) expenses increased 5% to euro 15.6 million for the fourth quarter of 2005 compared to euro 14.8 million for the third quarter of 2005. General and administrative (G&A) expenses for the fourth quarter of 2005 increased 20% to euro 5.5 million compared to euro 4.6 million for the previous quarter. The Company’s net loss increased 4% to euro (17.2) million in the fourth quarter of 2005, compared to euro (16.5) million for the previous quarter. Basic and diluted loss per share was euro (0.57) for the fourth quarter of 2005 compared to euro (0.55) for the previous quarter.
Comparison to previous year: fourth quarter 2005 compared to fourth quarter 2004
Revenues for the three months ended December 31, 2005 decreased 20% to euro 2.8 million compared to euro 3.5 million for the same period in 2004. R&D expenses increased 27% for the fourth quarter of 2005 to euro 15.6 million compared to euro 12.3 million for the same period in 2004. G&A expenses for the fourth quarter of 2005 increased 41% to euro 5.5 million compared to euro 3.9 million for the same quarter in 2004. Net loss for the fourth quarter of 2005 increased 25% to euro (17.2) million compared to euro (13.8) million for the fourth quarter of 2004. Basic and diluted loss per share was euro (0.57) for the fourth quarter of 2005 compared to euro (0.50) for the same period in 2004.
Fiscal year 2005 compared to fiscal year 2004
As anticipated, revenues decreased 26% to euro 9.3 million for the fiscal year ended December 31, 2005, compared to euro 12.6 million for the same period in 2004. As the ongoing collaboration with ALTANA Pharma matures, the expected reduction in revenues under this collaboration led to the reduction in total revenues compared to the previous year. No revenues from the co- development and license agreement with Pharmion were recognized in fiscal year 2005. R&D expenses increased 39% to euro 55.7 million for 2005 compared to euro 40.0 million for 2004. The increase was mainly due to increased drug development activities, including the continued ramp-up of patient enrollment in the satraplatin SPARC Phase 3 registrational trial, as well as increased drug discovery efforts following the acquisition of the assets of Axxima Pharmaceuticals in early 2005. In 2005, G&A expenses amounted to euro 20.6 million. G&A expenses for 2005 include a charge related to the contractual loss on a sublease of euro 3.0 million. Excluding this charge related to the sublease, G&A expenses increased 33% to euro 17.6 million compared to euro 13.2 million for 2004. Net loss increased 56% to euro (62.2) million compared to euro (39.9) million for 2004. Basic and diluted loss per share was euro (2.08) compared to euro (1.60) for 2004.
As of December 31, 2005, cash, cash equivalents, marketable securities and short-term investments totaled euro 95.2 million (December 31, 2004: euro 131.0 million), including euro 1.6 million in restricted cash. The net cash burn was euro 47.3 million for 2005. Net cash burn is derived by adding net cash used in operating activities (euro 42.8 million) and purchases of property, equipment and licenses (euro 4.5 million). The figures used to calculate net cash burn are contained in the Company’s consolidated statements of cash flows for the twelve-month period ended December 31, 2005. Net cash burn was euro 10.8 million for the fourth quarter of 2005, euro 12.9 million for the third quarter of 2005, euro 11.9 million for the second quarter of 2005 and euro 11.6 million for the first quarter of 2005.
Of note, in the first quarter of 2006, the Company received an additional euro 67.5 million from an upfront development-related payment of euro 31.3 million from its partner Pharmion in connection with the co-development and license agreement signed in December 2005 and euro 36.2 million through a private placement with two investment companies owned by SAP co-founder Dietmar Hopp and his son, respectively.
“Our financial results for 2005 continue to reflect our expanding efforts to successfully develop our anticancer pipeline, especially satraplatin,” said Mirko Scherer, Ph.D., Senior Vice President and Chief Financial Officer. “We expect revenues to approximately double in 2006 compared to 2005. For 2006 we expect R&D expenses to increase moderately compared to 2005 as regulatory- related expenses increase and we initiate new and expand existing clinical trials. Fortunately, our agreement with Pharmion provides us substantial development-related funding as we move satraplatin forward. This important collaboration, in addition to our recent private placement, puts us in a strong financial position at such an important time for our Company.”
“During 2005, we took critically important steps to build a sustainable future for GPC Biotech,” said Bernd R. Seizinger, M.D., Ph.D., Chief Executive Officer. “We had several key achievements with our lead drug candidate satraplatin, including reaching target accrual in December in our Phase 3 registrational trial -- the SPARC trial -- making this one of the fastest- accruing Phase 3 trials for a chemotherapy drug ever to be conducted in prostate cancer. Also in December, we started the rolling NDA submission with the U.S. FDA. In addition to advancing the registrational trial in prostate cancer, we initiated several additional clinical trials for satraplatin, to broadly explore its anti-cancer activity in various other important tumor types, such as breast cancer and non-small cell lung cancer. The year culminated with the signing of a co-development and license agreement with Pharmion for the commercialization of satraplatin in Europe and certain other territories. Under this agreement, we could receive up to $270 million in total payments based upon the achievement of regulatory and sales milestones, in addition to significant royalties on net sales. We also advanced a second anticancer drug candidate -- the monoclonal antibody 1D09C3 -- into the clinic and acquired substantially all of the assets and hired many of the discovery scientists of another biotechnology company to enhance our own oncology drug discovery engine.”
Dr. Seizinger continued, “The year 2006 promises to be even more important as we expect to see efficacy data from our Phase 3 registrational trial for satraplatin. Provided these data are positive, our goal is to then complete the NDA filing for marketing approval of satraplatin in the U.S. by the end of this year and file through our partner Pharmion in Europe in the first quarter of 2007. We look forward to another successful year as we continue to drive forward satraplatin, as well as our other anticancer programs.”
Highlights since third quarter of 2005 update Satraplatin * Signing of co-development and license agreement with Pharmion for the commercialization of satraplatin in Europe, the Middle East, Australia and New Zealand, involving a payment of $37.1 (euro 31.3) million already received by GPC Biotech and in total payments of up to $270 million based upon the achievement of regulatory and sales milestones plus royalties * Satraplatin Phase 3 registrational trial (SPARC) fully accrued with a total of 950 patients * Start rolling NDA submission for satraplatin -- CMC section submitted to U.S. FDA * Start of Phase 2 trial evaluating satraplatin in patients with metastatic breast cancer * Start of Phase 2 trial evaluating satraplatin plus Taxol(R) in patients with advanced non-small cell lung cancer * Start of Phase 1 trial evaluating satraplatin plus Taxotere(R) in patients with advanced solid tumors; trial is evaluating a different dosing schedule with Taxotere compared to trial started in mid-2005 Additional achievements * Private placement with two investment companies owned by SAP co-founder Dietmar Hopp and his son, respectively, raising euro 36.2 million * Start of additional Phase 1 clinical trial with 1D09C3 anticancer monoclonal antibody * Granting of orphan drug designation for 1D09C3 by European Commission for chronic lymphocytic leukemia and multiple myeloma Company provides update on satraplatin SPARC Phase 3 registrational trial
GPC Biotech also provided an update on the SPARC trial, which is evaluating satraplatin plus prednisone as a second-line chemotherapy treatment for hormone-refractory prostate cancer (HRPC). The Company reported that a total of 950 patients had been enrolled in the trial, with 60% of patients from Europe, 27% from the U.S. and Canada and 13% from South America. The Company also reported that the independent Data Monitoring Board for the SPARC trial has now set a date for the interim efficacy analysis, which will be held in late April. The Company reiterated its expectation that the trial will continue to its completion, with full progression-free survival data available in the second half of 2006.
Conference call scheduled
As previously announced, the Company has scheduled a conference call to which participants may listen via live webcast, accessible through the GPC Biotech Web site at http://www.gpc-biotech.com or via telephone. A replay will be available via the Web site following the live event. The call, which will be conducted in English, will be held on Wednesday, March 15, 2006 at 14:00 CET/8:00 AM EST. The dial-in numbers for the call are as follows:
European participants: 0049 (0)69 500 71846
U.S. participants: 1-800-599-9816 (toll-free)
GPC Biotech AG is a biopharmaceutical company discovering and developing new anticancer drugs. The Company’s lead product candidate -- satraplatin -- has achieved target enrollment in a Phase 3 registrational trial as a second-line chemotherapy treatment in hormone-refractory prostate cancer. The U.S. FDA has granted fast track designation to satraplatin for this indication, and GPC Biotech has begun the rolling NDA submission process for this compound. GPC biotech is also developing a monoclonal antibody with a novel mechanism-of-action against a variety of lymphoid tumors, currently in Phase 1 clinical development, and has ongoing drug development and discovery programs that leverage its expertise in kinase inhibitors. GPC Biotech AG is headquartered in Martinsried/Munich (Germany). The Company’s wholly owned U.S. subsidiary has sites in Waltham, Massachusetts and Princeton, New Jersey. For additional information, please visit the Company’s Web site at http://www.gpc- biotech.com.
This press release may contain forward-looking statements, including statements about the progress, timing and completion of research, development, pre-clinical studies and clinical trials for the Company’s product candidates; the timing and ultimate success in obtaining regulatory approval in the U.S., Europe or any other jurisdiction for satraplatin or any other product candidates; the Company’s ability to market, commercialize, achieve market acceptance for and sell the Company’s product candidates; the Company’s ability to adequately protect its intellectual property and operate its business without infringing upon the intellectual property rights of others; and the Company’s estimates regarding anticipated operating losses, future revenues, capital requirements and needs for additional financing. These forward-looking statements are based on the Company’s current expectations and projections about future events and are subject to risks, uncertainties and assumptions. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this press release might not occur. We direct you to the Company’s Annual Report on Form 20-F, as amended, for the fiscal year ended December 31, 2004 and other reports filed with the U.S. Securities and Exchange Commission (SEC) for additional details on the important factors that may affect the Company’s future results, performance and achievements. Except as required by law, the Company disclaims any intent or obligation to publicly update or revise these forward-looking statements whether as a result of new information, future events or otherwise. You are advised, however, to consult any additional disclosure the Company makes on its current reports on Form 6-K to the SEC.
Taxol(R) (paclitaxel) is a registered trademark of Bristol-Myers Squibb Company.
Taxotere(R) (docetaxel) is a registered trademark of Aventis Pharma S.A. For further information, please contact: GPC Biotech AG Fraunhoferstr. 20 82152 Martinsried/Munich, Germany Martin Braendle Associate Director, Investor Relations & Corporate Communications Phone: +49 (0)89 8565-2693 ir@gpc-biotech.com In the U.S.: Laurie Doyle Associate Director, Investor Relations & Corporate Communications Phone: +1 781 890 9007 X267 usinvestors@gpc-biotech.com Additional Media Contact: Maitland Noonan Russo Brian Hudspith Phone: +44 (0)20 7379 5151 bhudspith@maitland.co.uk -- Financials follow -- Consolidated Statements of Operations (U.S. GAAP) in thousand euro, except share and per share data 2005 2004 Q4 2005 Q4 2004 Collaborative revenues (a) 9,341 12,649 2,847 3,503 Total revenues 9,341 12,649 2,847 3,503 Research and development expenses 55,684 39,955 15,632 12,300 General and administrative expenses 20,590 13,173 5,475 3,878 In-process research and development 683 - - - Amortization of intangible assets 417 413 145 266 Total operating expenses 77,374 53,541 21,252 16,444 Operating loss (68,033) (40,892) (18,405) (12,941) Other income (expense), net 2,938 (1,554) 716 (1,636) Interest income 2,963 2,618 501 793 Interest expense (75) (99) (14) (26) Net loss (62,207) (39,927) (17,202) (13,810) Basic and diluted net loss per share, in euro (2.08) (1.60) (0.57) (0.50) Shares used in computing basic and diluted loss per share 29,877,348 24,950,638 30,128,448 28,704,436 (a) Revenues from related party Collaborative revenues 9,095 12,588 2,791 3,442 See accompanying notes to consolidated financial statements. Consolidated Balance Sheets (U.S. GAAP) in thousand euro, except share data and per share data December 31, Assets 2005 2004 Current assets Cash and cash equivalents 30,559 59,421 Marketable securities and short-term investments 63,061 69,248 Accounts receivable 31,326 - Accounts receivable, related party 1,436 1,006 Prepaid expenses 1,333 1,170 Other current assets 3,920 4,211 Total current assets 131,635 135,056 Property and equipment, net 4,103 2,615 Intangible assets, net 1,072 1,133 Other assets, non-current 838 768 Restricted cash 1,615 2,321 Total assets 139,263 141,893 Liabilities and shareholders’ equity Current liabilities Accounts payable 2,141 519 Accrued expenses and other current liabilities 11,274 6,910 Current portion of deferred revenue, related party 5,228 4,938 Current portion of deferred revenue 19,548 - Total current liabilities 38,191 12,367 Deferred revenues, related party, net of current portion 975 2,925 Deferred revenue, net of current portion 12,053 - Convertible bonds 2,334 1,768 Other liabilities, non-current 2,177 - Shareholders’ equity Ordinary shares, euro 1 non-par, notional value; Shares authorized: 53,780,630 at December 31, 2005 and 51,655,630 at December 31, 2004 Shares issued and outstanding: 30,151,757 at December 31, 2005 and 28,741,194 at December 31, 2004 30,152 28,741 Additional paid-in capital 284,931 266,074 Accumulated other comprehensive loss (2,093) (2,732) Accumulated deficit (229,457) (167,250) Total shareholders’ equity 83,533 124,833 Total liabilities and shareholders’ equity 139,263 141,893 See accompanying notes to consolidated financial statements. Consolidated Statements of Cash Flows (U.S. GAAP) Years Ended December 31, in thousand euro 2005 2004 Cash flows from operating activities Net loss (62,207) (39,927) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation 3,478 1,568 Amortization 417 413 Compensation cost for stock option plans and convertible bonds 6,665 3,451 Loss accrual on sublease contract 2,988 - Acquired in-process research and development 683 - Change in accrued interest income on marketable securities and short-term investments 478 (556) Bond premium amortization 629 513 (Gain)/loss on disposal of property and equipment (83) 56 (Gain)/loss on marketable securities and short-term investments - 841 Changes in operating assets and liabilities: Accounts receivable, related party (430) (1,006) Accounts receivable (31,325) 754 Other assets, current and non-current 1,550 (1,987) Accounts payable 1,552 (96) Deferred revenue, related party (1,671) (2,241) Deferred revenue 31,602 (165) Other liabilities and accrued expenses 2,887 566 Net cash used in operating activities (42,787) (37,816) Cash flows from investing activities Purchases of property, equipment and licenses (4,549) (1,071) Proceeds from the sale of property and equipment 187 - Proceeds from sale of marketable securities and short-term investments 35,803 4,289 Purchases of marketable securities and short-term investments (31,408) (20,267) Net cash (used in) provided by investing activities 33 (17,049) Cash flows from financing activities Proceeds from issuance of shares in asset acquisition, net of payments for costs of transaction 10,412 - Proceeds from equity offering, net of payments for costs of transaction - 77,976 Proceeds from issuance of convertible bonds 580 935 Repayment of convertible bonds (8) (4) Proceeds from exercise of stock options and convertible bonds 517 2,038 Principal payments under capital lease obligations - (634) Principal payments of loans - (639) Net cash provided by financing activities 11,501 79,672 Effect of exchange rate changes on cash 1,393 (314) Changes in Restricted cash 998 (19) Net increase/(decrease) in cash and cash equivalents (28,862) 24,474 Cash and cash equivalents at the beginning of the year 59,421 34,947 Cash and cash equivalents at the end of the year 30,559 59,421 Supplemental Information: Cash paid for interest 107 63 Non-cash investing and financing activities: Net assets acquired in exchange for shares in connection with asset acquisition 2,667 - See accompanying notes to consolidated financial statements. Consolidated Statements of Changes in Shareholders’ Equity (U.S. GAAP) Ordinary shares Additional in thousand euro, Paid- Subscribed except share data Shares Amount in Capital Shares Balance as of December 31, 2003 20,754,075 20,754 190,335 215 Components of comprehensive loss: Net loss Change in unrealized gain on available-for-sale securities Accumulated translation adjustments Total comprehensive loss Issuance of shares in equity offering 7,160,000 7,160 70,816 Exercise of stock options and convertible bonds 827,119 827 1,472 (215) Compensation costs for stock options and convertible bonds 3,451 Balance as of December 31, 2004 28,741,194 28,741 266,074 - Components of comprehensive loss: Net loss Change in unrealized gain on available-for-sale securities Accumulated translation adjustments Total comprehensive loss Issuance of shares in asset acquisition 1,311,098 1,311 11,768 Exercise of stock options and convertible bonds 99,465 100 424 Compensation costs for stock options and convertible bonds 6,665 Balance as of December 31, 2005 30,151,757 30,152 284,931 - See accompanying notes to consolidated financial statements. Consolidated Statements of Changes in Shareholders’ Equity (U.S. GAAP) Accumulated Other Total in thousand euro, except Comprehensive Accumulated Shareholders’ share data Loss Deficit Equity Balance as of December 31, 2003 (2,102) (127,323) 81,879 Components of comprehensive loss: Net loss (39,927) (39,927) Change in unrealized gain on available-for-sale securities (154) (154) Accumulated translation adjustments (476) (476) Total comprehensive loss (40,557) Issuance of shares in equity offering 77,976 Exercise of stock options and convertible bonds 2,084 Compensation costs for stock options and convertible bonds 3,451 Balance as of December 31, 2004 (2,732) (167,250) 124,833 Components of comprehensive loss: Net loss (62,207) (62,207) Change in unrealized gain on available-for-sale securities (684) (684) Accumulated translation adjustments 1,323 1,323 Total comprehensive loss (61,568) Issuance of shares in asset acquisition 13,079 Exercise of stock options and convertible bonds 524 Compensation costs for stock options and convertible bonds 6,665 Balance as of December 31, 2005 (2,093) (229,457) 83,533
GPC Biotech AG
CONTACT: Martin Braendle, Associate Director, Investor Relations &Corporate Communications, +49 (0)89 8565-2693, ir@gpc-biotech.com, orLaurie Doyle, Associate Director, Investor Relations & CorporateCommunications, +1-781-890-9007 ext. 267, usinvestors@gpc-biotech.com, bothof GPC Biotech AG; or Brian Hudspith of Maitland Noonan Russo, +44 (0)207379 5151, bhudspith@maitland.co.uk
Web site: http://www.gpc-biotech.com//
