VaxGen Announces Fourth-Quarter and Full-Year Financial Results
Results to be Reviewed on Conference Call and Webcast Today
BRISBANE, Calif., Feb. 12 -- VaxGen, Inc. (Nasdaq: VXGN) today announced financial results for the fourth quarter and the full year ended December 31, 2001.
(Photo: http://www.newscom.com/cgi-bin/prnh/19991112/VAXGENLOGO )
For the fourth quarter ended December 31, 2001, VaxGen reported a net loss of $6.4 million, or 45 cents per share, before non-cash charges attributable to a redeemable convertible preferred stock financing that closed in May 2001. Including non-cash charges associated with the 2001 financing, the net loss applicable to common stockholders for the most recent quarter was $7.1 million, or 50 cents per share. These figures compare to a net loss of $15.4 million, or $1.11 per share, in the fourth quarter ended December 31, 2000, which included $9.3 million, or 67 cents per share, from a non-cash compensation expense. VaxGen posted revenue of $474,000 for the most recent quarter, compared with $75,000 in the year-ago quarter.
For the full year ended December 31, 2001, VaxGen reported a net loss of $24.4 million, or $1.72 per share, before non-cash charges attributable to the 2001 financing. Including non-cash charges associated with the financing, the net loss applicable to common stockholders for the year was $26.9 million, or $1.90 per share. These figures compare to a net loss of $31.8 million, or $2.33 per share, for the year ended December 31, 2000. Revenue for the full year totaled $895,000, compared with $275,000 in 2000.
Use of Cash
As of December 31, 2001, VaxGen had $48.4 million in cash, cash equivalents and investment securities, compared with $53.1 million at the end of the quarter ended September 30, 2001. VaxGen spent a net of $21.7 million in 2001, $2.3 million less than it had originally projected for the year. The company expects to have net spending of approximately $28 million in 2002.
"We expect our expenses to increase somewhat in 2002 as we hire additional personnel required to prepare a regulatory submission to the Food and Drug Administration if our vaccine, AIDSVAX, proves effective about a year from now," said Lance K. Gordon, Ph.D., VaxGen's chief executive officer. "We have already added three senior and very experienced people this year to oversee manufacturing, regulatory affairs and quality assurance and control, so we are well on our way to building the team necessary to prepare for success."
Highlights for VaxGen in the year 2001 and 2002 to date include:
-- The presentation and publication of scientific results that suggest that AIDSVAX induces antibodies that bind to a wider variety of HIV subtypes than originally expected. VaxGen also presented data showing that sera from people immunized with AIDSVAX reacted with a variety of primary isolates in a new assay developed at VaxGen that appears to be more sensitive than the conventional primary isolate neutralization assay. Primary isolates are the type of HIV found in nature and are considered the most difficult to neutralize;
-- The hiring in September 2001 of Dr. Gordon as chief executive officer. Dr. Gordon has nearly 25 years of experience in the vaccine industry and founded two publicly traded vaccine companies before joining VaxGen;
-- The hiring last week of James Panek as senior vice president of Manufacturing Operations. Panek is the former senior vice president of Product Operations at Genentech Inc., where he led the development of the world's largest biotechnology manufacturing facility;
-- The hiring in January 2002 of Carmen M. Betancourt as vice president of Regulatory Affairs and Quality Systems, and Mark R. Busch, Ph.D., as senior director of Quality Assurance; and
-- The successful conclusion in 2001 of two safety reviews by the independent organization that oversees VaxGen's two Phase III trials. AIDSVAX continues to appear safe following approximately 30,000 injections of the vaccine.
VaxGen will hold a conference call and webcast today at noon, EST, to discuss its results and respond to questions. Participants are asked to dial in to the live call five minutes before the start of the presentation. The following information will provide access to the webcast, conference call and replay, which will be available for 24 hours after the live call.
Live Call: Domestic: (877) 888-4210
International: (416) 695-5259
No passcode required
Replay: Domestic: (877) 296-3928
International: (416) 695-5796
The webcast can be found by clicking on "Fourth Quarter Conference Call and Webcast" under "Company Presentations" in the Investor Relations section of VaxGen's web site at www.vaxgen.com/invest. This will bring up a window from Vcall.com. Then click on the "Real Audio" button to view the accompanying slide presentation.
The webcast can also be accessed through Vcall's web site at http://www.vcall.com/EventPage.asp?ID=80737, and will be archived for 30 days.
VaxGen is the only company with preventive HIV vaccines in Phase III trials, the final stage before regulatory approval can be sought. VaxGen's two Phase III trials -- one in North America and Europe and another in Thailand -- are meant to determine how well its vaccine, AIDSVAX, prevents HIV infection in humans. At the end of 2002, when the last of the 5,400 volunteers in the North American/European trial are expected to finish the study, VaxGen will begin its analysis of the data. VaxGen expects to complete its data analysis and announce the results of the trial in the first quarter of 2003. VaxGen expects to announce results from the Thai trial in the fourth quarter of 2003. VaxGen is located in Brisbane, Calif. For more information, please visit the company's web site at www.vaxgen.com.
NOTE: AIDSVAX(R) is a registered trademark of VaxGen.
This news release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to known and unknown risks, uncertainties or other factors that may cause VaxGen's actual results to be materially different from historical results, expressed or implied by such forward-looking statements. Factors that might cause such a difference include, but are not limited to, uncertainties related to the progress, costs and results of the Company's Phase III clinical trials, the progress of other internal research and development projects, the Company's ability to demonstrate efficacy of AIDSVAX in clinical trials, the Company's ability to obtain regulatory approval to market AIDSVAX and the Company's ability to secure commercial-scale manufacturing for AIDSVAX. Reference should be made to VaxGen's Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 30, 2001, under the headings "Factors Affecting Future Results" and "Business" and to VaxGen's Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission on August 14, 2001, under the heading "Risk Factors," for a more detailed description of such factors. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date of this release. VaxGen undertakes no obligation to update publicly any forward-looking statements to reflect new information, events, or circumstances after the date of this release or to reflect the occurrence of anticipated events.
Condensed Statements of Operations (unaudited)
(In thousands, except for per share data)
Ended Ended Year Ended Year Ended
Dec. 31, Dec. 31, Dec. 31, Dec. 31,
2001 2000 2001 2000
Contract revenue $474 $75 $895 $275
development (3,988) (4,256) (16,701) (18,513)
administrative (3,613) (12,082) (11,823) (17,465)
Loss from operations (7,127) (16,263) (27,629) (35,703)
Other income, net 729 903 3,255 3,900
Net loss (6,398) (15,360) (24,374) (31,803)
preferred stock (751) -- (2,484) --
Net loss applicable
shareholders $(7,149) $(15,360) $(26,858) $(31,803)
Net loss per share,
basic and diluted $(0.45) $(1.11) $(1.72) $(2.33)
Net loss per share
basic and diluted $(0.50) $(1.11) $(1.90) $(2.33)
shares used in
loss per share 14,226 13,833 14,145 13,636
Condensed Balance Sheets (unaudited)
Dec. 31, Dec. 31,
Cash and investment securities $48,410 $48,524
Property and equipment, net 2,987 3,202
Other assets 1,975 5,071
Total Assets $53,372 $56,797
Liabilities and Stockholders' Equity:
Current liabilities $4,944 $5,358
Other liabilities 22 367
Redeemable convertible preferred stock 15,845 --
Stockholders' equity 32,561 51,072
Total Liabilities and Stockholders' Equity $53,372 $56,797