MARTINSRIED/MUNICH, Germany, March 15 /PRNewswire-FirstCall/ -- U.S. Research and Development Facilities in WALTHAM, Mass. and PRINCETON, N.J., -- GPC Biotech AG today reported financial results for the fourth quarter and fiscal year ended December 31, 2006.
Fiscal year 2006 compared to fiscal year 2005
Revenues increased 143% to euro 22.7 million for the fiscal year ended December 31, 2006, compared to euro 9.3 million for 2005. The increase in revenues is due to development funding received under the co-development and license agreement for satraplatin for Europe and certain other territories with Pharmion that was signed in December 2005. Research and development (R&D) expenses increased 16% to euro 64.7 million for 2006 compared to euro 55.7 million for 2005. This increase was mainly due to expenses related to satraplatin, such as expenses for clinical trials and the accrual of a milestone obligation to Spectrum Pharmaceuticals, Inc. in the amount of USD $6 million, which will become due upon the acceptance for filing of a New Drug Application (NDA) for satraplatin by the U.S. FDA and the acceptance of the Marketing Authorization Application (MAA) in Europe. In 2006, general and administrative (G&A) expenses increased 16% to euro 23.8 million compared to euro 20.6 million for 2005. Net loss for the fiscal year 2006 increased 3% to euro (64.0) million compared to euro (62.2) million for 2005. Basic and diluted loss per share was euro (1.95) for 2006 compared to euro (2.08) for 2005.
As of December 31, 2006, cash, cash equivalents, marketable securities and short-term investments totaled euro 97.1 million (December 31, 2005: euro 95.2 million), including euro 1.5 million in restricted cash. Net cash burn for the fiscal year 2006 was euro 38.5 million with net cash generated of euro 12.5 million in the first quarter of 2006, net cash burn of euro 16.1 million for the second quarter of 2006, net cash burn of euro 14.6 million for the third quarter and of euro 20.3 million for the fourth quarter of 2006. Net cash burn/generated is derived by adding net cash provided by (used in) operating activities and purchases of property, equipment and licenses. The figures used to calculate net cash burn are contained in the Company's consolidated statements of cash flows for the fiscal year ended December 31, 2006.
Quarter over quarter results: fourth quarter 2006 compared to third quarter 2006
Revenues for the fourth quarter of 2006 were euro 5.1 million compared to euro 6.6 million for the previous quarter. R&D expenses were euro 15.6 million for the fourth quarter of 2006 compared to euro 20.1 million for third quarter of 2006. G&A expenses for the second quarter were euro 7.6 million compared to euro 6.1 million for the previous quarter. The Company's net loss decreased to euro (17.2) million in the fourth quarter of 2006 compared to euro (18.7) million for the previous quarter. Basic and diluted loss per share was euro (0.50) for the fourth quarter of 2006 compared to euro (0.57) for the previous quarter.
Comparison to previous year: fourth quarter 2006 compared to fourth quarter 2005
Revenues for the three months ended December 31, 2006 increased 79% to euro 5.1 million compared to euro 2.8 million for the same period in 2005. R&D expenses for the fourth quarter of 2006 were stable at euro 15.6 million compared to euro 15.6 million for the fourth quarter of 2005. G&A expenses for the fourth quarter of 2006 were euro 7.6 million compared to euro 5.5 million for the same quarter in 2005. Net loss for the fourth quarter of 2006 was stable at euro (17.2) million compared to euro (17.2) million for the fourth quarter of 2005. Basic and diluted loss per share was euro (0.50) for the fourth quarter of 2006 compared to euro (0.57) for the same period in 2005.
"Our revenues increased by 143% in 2006 compared to the previous year due to development funding received under our co-development and license agreement with Pharmion. This is the highest annual revenue figure in the history of GPC Biotech," said Mirko Scherer, Ph.D., Senior Vice President and Chief Financial Officer.
"The year 2006 was the most significant year to date in the history of GPC Biotech, highlighted by the positive topline data from the satraplatin Phase 3 registrational trial in second-line hormone-refractory prostate cancer that we announced in the fall. To explore potential additional uses for satraplatin, we initiated a number of clinical trials exploring satraplatin in combination with a variety of anticancer treatments and in various cancer types. We are also moving forward with other anticancer programs in our pipeline. In December 2006, for example, we presented the first clinical data with our second product candidate, 1D09C3, a monoclonal antibody against lymphoid tumors," said Bernd R. Seizinger, M.D., Ph.D., Chief Executive Officer.
Dr. Seizinger continued: "The year 2007 promises to be another pivotal year for GPC Biotech as we progress through the regulatory process for satraplatin in the U.S. and - in cooperation with our partner Pharmion - in Europe. We expect that the U.S. FDA will reach a decision on our NDA filing for satraplatin during 2007."
Highlights: fourth quarter 2006 and year-to-date 2007 -- Private placement with institutional investors raising gross proceeds of euro 33.6 million (~$43.7 million) -- Rolling submission of an NDA to the U.S. FDA for satraplatin completed -- Final progression-free survival (PFS) results for the satraplatin SPARC Phase 3 registrational trial in second-line chemotherapy for hormone- refractory prostate cancer presented at the ASCO Prostate Cancer Symposium in Orlando, Florida -- Satraplatin Expanded Rapid Access protocol (SPERA) launched in the U.S. -- Preliminary clinical data on anticancer monoclonal antibody 1D09C3 presented at the 48th Annual Meeting of the American Society of Hematology (ASH) in Orlando, Florida Financial outlook 2007
Revenues: The Company expects revenues to remain stable in 2007 compared to 2006.
The primary source of revenue for 2007 is expected to be from the Company's co-development and licensing agreement with Pharmion.
Expenses: For 2007 the Company expects R&D expenses to be slightly higher than 2006.
The Company plans to continue to open more Phase 1 and 2 clinical trials with satraplatin in combination with other drugs and in other cancer types. In addition to the milestones to Spectrum Pharmaceuticals that the Company already accrued for in the third quarter of 2006, GPC Biotech is obligated to pay Spectrum an undisclosed milestone payment should satraplatin be granted marketing approval in the U.S. GPC Biotech is obligated to pay Spectrum a certain percentage of milestone payments GPC Biotech receives under any sublicense agreements, such as the agreement with Pharmion.
Selling, general and administrative expenses are expected to increase significantly during 2007 as the Company prepares for the launch of satraplatin.
Cash burn: For 2007, cash burn is expected to be higher than in 2006, mainly driven by significant outlays in preparation for the commercialization of satraplatin, including the ordering of commercial supplies.
Corporate calendar
Two dates in the corporate calendar have changed. The report on the financial results for the first quarter of 2007 will now be published on May 15, 2007 (previously scheduled for May 8). The Annual Shareholders Meeting will now be held on May 25, 2007 in Munich instead of June 6. All other 2007 financial reporting dates remain the same and are posted on the Company's Web site at www.gpc-biotech.com.
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 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 March 15th at 14:00 CET/9:00 AM ET. The dial-in numbers for the call are as follows:
Participants from Europe: 0049 (0)69 9897 2633 or 0044 (0)20 7365 1832 Participants from the U.S.: 1-718-354-1171 Please dial in 10 minutes before the beginning of the meeting. About GPC Biotech
GPC Biotech AG is a publicly traded biopharmaceutical company focused on discovering, developing and commercializing new anticancer drugs. GPC Biotech's lead product candidate - satraplatin - is an oral platinum-based compound that has shown highly statistically significant results for progression-free survival 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 the rolling NDA submission process for this compound has been completed. Satraplatin was in-licensed from Spectrum Pharmaceuticals, Inc. 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), and its wholly owned U.S. subsidiary has sites in Waltham, Massachusetts and Princeton, New Jersey. For additional information, please visit GPC Biotech's Web site at www.gpc-biotech.com.
This press release contains forward-looking statements, which express the current beliefs and expectations of the management of GPC Biotech AG. Such statements are based on current expectations and are subject to risks and uncertainties, many of which are beyond our control, that could cause future results, performance or achievements to differ significantly from the results, performance or achievements expressed or implied by such forward-looking statements. Actual results could differ materially depending on a number of factors, and we caution investors not to place undue reliance on the forward- looking statements contained in this press release. In particular, additional information relating to the safety, efficacy or tolerability of satraplatin may be discovered upon further analysis of data from the SPARC trial or analysis of additional data from other ongoing clinical trials for satraplatin. Furthermore, even if these results are confirmed upon full analysis of the trial, we cannot guarantee that satraplatin will be approved for marketing in a timely manner, if at all, by regulatory authorities nor that, if marketed, satraplatin will be a successful commercial product. We direct you to GPC Biotech's Annual Report on Form 20-F for the fiscal year ended December 31, 2005 and other reports filed with the U.S. Securities and Exchange Commission for additional details on the important factors that may affect the future results, performance and achievements of GPC Biotech. Forward-looking statements speak only as of the date on which they are made and GPC Biotech does not undertake any obligation to update these forward- looking statements, even if new information becomes available in the future.
The scientific information discussed in this press release related to satraplatin is investigative. Satraplatin has not yet been approved by the FDA in the U.S., the EMEA in Europe or any other regulatory authority and no conclusions can or should be drawn regarding its safety or effectiveness. Only the relevant regulatory authorities can determine whether satraplatin is safe and effective for the use(s) being investigated.
GPC Biotech AG Martin Braendle Director, Investor Relations & Corporate Communications Phone: +49 (0)89 8565-2693 ir@gpc-biotech.com In the U.S.: Laurie Doyle Director, Investor Relations & Corporate Communications Phone: +1 781 890 9007 X267 usinvestors@gpc-biotech.com Additional Media Contacts: In Europe: Maitland Brian Hudspith Phone: +44 (0)20 7379 5151 bhudspith@maitland.co.uk In the U.S.: Noonan Russo David Schull Phone: +1 212 845-4271 david.schull@eurorscg.com Condensed Consolidated Statements of Operations (U.S. GAAP) in thousand euro, except share and per share data 2006 2005 Q4 2006 Q4 2005 Collaborative revenues (a) 22,252 9,341 4,949 2,847 Grant revenues 422 - 142 - Total revenues 22,674 9,341 5,091 2,847 Research and development expenses 64,707 55,684 15,581 15,632 General and administrative expenses 23,834 20,590 7,587 5,475 In-process research and development - 683 - - Amortization of intangible assets 325 417 112 145 Total operating expenses 88,866 77,374 23,280 21,252 Operating loss (66,192) (68,033) (18,189) (18,405) Other income (expense), net (2,316) 2,938 (64) 716 Interest income 4,152 2,963 1,032 501 Interest expense (90) (75) (25) (14) Net loss before cumulative effect of change in accounting principle (64,446) (62,207) (17,246) (17,202) Cumulative effect of change in accounting principle 433 - - - Net loss (64,013) (62,207) (17,246) (17,202) Loss per share before change in accounting principle (1.95) (2.08) (0.50) (0.57) Cumulative effect of change in accounting principle 0.01 - - - Basic and diluted loss per share, in euro (1.94) (2.08) (0.50) (0.57) Shares used in computing basic and diluted loss per share 33,840,480 29,877,348 33,750,609 30,128,448 (a) Revenues from related party Collaborative revenues 7,054 9,095 1,227 2,791 See accompanying notes to unaudited condensed consolidated financial statements. GPC Biotech AG Condensed Consolidated Balance Sheets (U.S. GAAP) in thousand euro, except share data and per share data December 31 Assets 2006 2005 Current assets Cash and cash equivalents 38,336 30,559 Marketable securities and short-term investments 57,186 63,061 Accounts receivable 11 31,326 Accounts receivable, related party 395 1,436 Prepaid expenses 1,299 1,333 Other current assets 2,970 3,920 Total current assets 100,197 131,635 Property and equipment, net 4,259 4,103 Intangible assets, net 405 1,072 Other assets, non-current 1,127 838 Restricted cash 1,531 1,615 Total assets 107,519 139,263 Liabilities and shareholders' equity Current liabilities Accounts payable 2,262 2,141 Accrued expenses and other current liabilities 14,346 11,274 Current portion of deferred revenue, related party 896 5,228 Current portion of deferred revenue 7,240 19,548 Total current liabilities 24,744 38,191 Deferred revenues, related party, net of current portion - 975 Deferred revenue, net of current portion 9,103 12,053 Convertible bonds 3,108 2,334 Other liabilities, non-current 3,389 2,177 Shareholders' equity Ordinary shares, euro 1 non-par, notional value; Shares authorized: 62,695,630 at December 31, 2006 and 53,780,630 at December 31, 2005 Shares issued and outstanding: 33,895,444 at December 31, 2006 and 30,151,757 at December 31, 2005 33,895 30,152 Additional paid-in capital 328,171 284,931 Subscribed shares 334 - Accumulated other comprehensive loss (1,755) (2,093) Accumulated deficit (293,470) (229,457) Total shareholders' equity 67,175 83,533 Total liabilities and shareholders' equity 107,519 139,263 See accompanying notes to unaudited condensed consolidated financial statements. Condensed Consolidated Statements of Cash Flows (U.S. GAAP) December 31, in thousand euro 2006 2005 Cash flows from operating activities Net loss (64,013) (62,207) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation 1,532 3,478 Amortization 325 417 Compensation cost for stock option plans and convertible bonds 6,938 6,665 Loss accrual on sublease contract 2,161 2,988 Acquired in-process research and development - 683 Cumulative effect of change in accounting principle (433) - Change in accrued interest income on marketable securities and short-term investments 293 478 Bond premium amortization 562 629 Other-than-temporary impairment on marketable securities 390 - Gain on disposal of property and equipment (24) (83) Changes in operating assets and liabilities: Accounts receivable, related party 1,041 (430) Accounts receivable 31,313 (31,325) Other assets, current and non-current 548 1,550 Accounts payable 271 1,552 Deferred revenue, related party (5,307) (1,671) Deferred revenue (15,259) 31,602 Other liabilities and accrued expenses 3,040 2,887 Net cash used in operating activities (36,622) (42,787) Cash flows from investing activities Purchases of property, equipment and licenses (1,878) (4,549) Proceeds from the sale of property and equipment 45 187 Proceeds from the sale or maturity of marketable securities and short-term investments 20,445 35,803 Purchases of marketable securities and short-term investments (19,906) (31,408) Net cash provided by investing activities 3,706 33 Cash flows from financing activities Proceeds from issuance of shares, net of payments for cost of transaction 36,080 - Proceeds from issuance of shares in asset acquisition, net of payments for costs of transaction - 10,412 Proceeds from issuance of convertible bonds 970 580 Payments for cancellation of convertible bonds - (8) Proceeds from exercise of stock options and convertible bonds 4,209 517 Cash received for subscribed shares 334 - Net cash provided by financing activities 41,593 11,501 Effect of exchange rate changes on cash (835) 1,393 Changes in restricted cash (65) 998 Net increase/(decrease) in cash and cash equivalents 7,777 (28,862) Cash and cash equivalents at the beginning of the period 30,559 59,421 Cash and cash equivalents at the end of the period 38,336 30,559 Supplemental Information: Cash paid for interest 94 107 Non-cash investing and financing activities: Net assets acquired in exchange for shares in connection with asset acquisition - 2,667 See accompanying notes to unaudited condensed consolidated financial statements. Condensed 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, 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, stock options and convertible bonds 6,665 Balance as of December 31, 2005 30,151,757 30,152 284,931 - Balance as of December 31, 2005 30,151,757 30,152 284,931 - Components of comprehensive loss: Net loss Change in unrealized gain on available-for-sale securities Accumulated translation adjustments Total comprehensive loss Cumulative effect of change in accounting principle (433) Issuance of shares 2,860,000 2,860 33,220 Exercise of stock options and convertible bonds 883,687 883 3,515 334 Compensation costs, stock options and convertible bonds 6,938 Balance as of December 31, 2006 33,895,444 33,895 328,171 334 See accompanying notes to unaudited condensed consolidated financial statements. Condensed 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, 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, stock options and convertible bonds 6,665 Balance as of December 31, 2005 (2,093) (229,457) 83,533 Balance as of December 31, 2005 (2,093) (229,457) 83,533 Components of comprehensive loss: Net loss (64,013) (64,013) Change in unrealized gain on available-for-sale securities 615 615 Accumulated translation adjustments (277) (277) Total comprehensive loss (63,675) Cumulative effect of change in accounting principle (433) Issuance of shares 36,080 Exercise of stock options and convertible bonds 4,732 Compensation costs, stock options and convertible bonds 6,938 Balance as of December 31, 2006 (1,755) (293,470) 67,175 See accompanying notes to unaudited condensed consolidated financial statements.
GPC Biotech AGCONTACT: Martin Braendle, Director, Investor Relations & CorporateCommunications, +49 (0)89 8565-2693, ir@gpc-biotech.com, or Laurie Doyle,Director, Investor Relations & Corporate Communications, +1-781-890-9007ext. 267, usinvestors@gpc-biotech.com, both of GPC Biotech AG; or In theU.S.: David Schull of Noonan Russo, +1-212-845-4271,david.schull@eurorscg.com; or In Europe: Brian Hudspith of Maitland, +44(0)20 7379 5151, bhudspith@maitland.co.uk
Web site: http://www.gpc-biotech.com//
