UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of
report (Date of earliest event reported): August 4, 2009
NEKTAR
THERAPEUTICS
(Exact
Name of Registrant as Specified in Charter)
|
Delaware
|
0-24006
|
94-3134940
|
||
|
(State
or Other Jurisdiction
of
Incorporation)
|
(Commission
File
Number)
|
(IRS
Employer
Identification
No.)
|
201
Industrial Road
San
Carlos, California 94070
(Address
of Principal Executive Offices and Zip Code)
Registrant’s
telephone number, including area code: (650) 631-3100
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
|
¨
|
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
|
|
¨
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|
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¨
|
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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¨
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
2.02
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Results
of Operations and Financial
Condition
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On August
4, 2009, Nektar Therapeutics issued a press release (the “Press Release”)
announcing its financial results for the second quarter ended June 30,
2009. A copy of the Press Release is furnished herewith as
Exhibit 99.1.
On July
30, 2009, the company announced that management would hold a conference call on
August 4, 2009 to review its financial results for the quarter ended June 30,
2009 and provide an update on the company’s business. On this
conference call, management expects to make certain forward-looking statements
regarding certain pre-clinical and clinical development results and progress for
certain of the company’s proprietary drug development programs, the value of the
company’s technology platform, and management’s financial guidance for
2009. These forward-looking statements involve substantial risks and
uncertainties including but not limited to: (i) the company’s
proprietary drug candidates, including NKTR-118, NKTR-102 and NKTR-105, are in
early to mid-stage clinical development and the risk of failure remains high and
can unexpectedly occur at any stage prior to regulatory approval due to lack of
efficacy, safety issues or other factors; (ii) the preliminary Phase 2 results
for NKTR-118 presented by management on the conference call remain subject to
change based on completion of the final data gathering and analysis; (iii) the
timing or success of the commencement or end of clinical trials and commercial
launch of new drugs may be delayed or unsuccessful due to regulatory delays,
clinical trial design, slower than anticipated patient enrollment, drug
manufacturing challenges, changing standards of care, clinical outcomes, or
delay or failure in obtaining regulatory approval in one or more important
markets; (iv) scientific discovery of new medical breakthroughs is an
inherently uncertain process and the future success of the application of the
company’s technology platforms to potential new drug candidates is therefore
very uncertain and unpredictable; (v) clinical trials are long, expensive and
uncertain processes and the risk of failure of any drug candidate that is in
clinical development and prior to regulatory approval remains high and can occur
at any stage due to efficacy, safety or other factors; (vi) management’s
financial projections for the company’s 2009 annual revenue, cash used in
operations and year-end cash position are subject to the significant risk of
unplanned revenue short-falls and unplanned expenses, which could adversely
affect the company’s actual 2009 annual financial results and end of year cash
position; (vii) the company’s patent applications for its proprietary or partner
product candidates may not issue, patents that have issued may not be
enforceable, or intellectual property licenses from third parties may be
required in the future; (viii) the outcome of any existing or future
intellectual property or other litigation related to the company’s proprietary
product candidates; (ix) the market sizes and revenue potential of the company’s
proprietary and partnered product programs are management’s current estimates
only and actual market sizes may differ materially; (x) the overall market size
for the partnered product programs and revenue and profit contribution potential
to the company will depend upon successful sales and marketing efforts by our
partners, competition from competing therapies (if any), government and private
insurance reimbursement, changing standards of care, commercial product profile
and final product pricing; (xi) if the company is unable to establish and
maintain collaboration partnerships on attractive commercial terms or for all
major markets, our business, results of operations and financial condition could
suffer; and (xii) certain other important risks and uncertainties set forth in
the company’s Annual Report on Form 10-K filed with the Securities and Exchange
Commission on March 6, 2009, the company’s most recent Quarterly Report on Form
10-Q for the quarter ended March 31, 2009, and the Quarterly Report on Form 10-Q
for the quarter ended June 30, 2009 expected to be filed by the company on
or about August 5, 2009. Actual results could differ materially from
the forward-looking statements made by management during the conference call and
in the press release attached as Exhibit 99.1 hereto. The company
undertakes no obligation to update forward-looking statements, whether as a
result of new information, future events or otherwise.
The
information in this report, including the exhibit hereto, is being furnished and
shall not be deemed “filed” for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended, or otherwise subject to the liabilities
of that Section or Sections 11 and 12(a)(2) of the Securities Act of 1933,
as amended. The information contained herein and in the accompanying
exhibit shall not be incorporated by reference into any filing with the
Securities and Exchange Commission made by Nektar Therapeutics, whether
made before or after the date hereof, regardless of any general
incorporation language in such filing.
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Item 9.01
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Financial
Statements and Exhibits
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Exhibit
No.
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Description
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99.1
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Press
release titled “Nektar Therapeutics Reports Second Quarter 2009 Financial
Results” issued on August 4,
2009.
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SIGNATURES
Pursuant
to the requirement of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
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By:
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/s/
Gil M. Labrucherie
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Gil
M. Labrucherie
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||
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General
Counsel and Secretary
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||
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Date:
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August
4, 2009
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Exhibit Index
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Exhibit
No.
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Description
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99.1
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Press
release titled “Nektar Therapeutics Reports Second Quarter 2009 Financial
Results” issued on August 4,
2009.
|
News
Release
Nektar
Therapeutics Reports Second Quarter 2009 Financial Results
SAN CARLOS, Calif., August 4,
2009 — Nektar Therapeutics (Nasdaq: NKTR) today reported its financial
results for the second quarter ended June 30, 2009.
Net loss
for the quarter ended June 30, 2009 was $32.1 million or $0.35 per share,
compared to net loss of $33.4 million or $0.36 per share in the second quarter
of 2008.
Nektar
made improvements to its operating efficiencies as compared to a year
ago. Total operating costs and expenses were down 19% to $43.5
million in the second quarter of 2009 as compared to $53.8 million in the second
quarter of 2008. For the first half of 2009, total operating costs
and expenses were down 28% to $83.5 million as compared to $115.6 million in the
first half of 2008.
“In the
first half of 2009, we made a strong commitment to advancing our clinical
pipeline,” stated Howard W. Robin, President and Chief Executive Officer of
Nektar. “We completed our Phase 2 clinical program for NKTR-118, and we
are poised to report Phase 2 data for NKTR-102 and Phase 1 data for NKTR-105 by
year-end. These achievements underscore the strength of Nektar’s drug
development organization and our successful strategy to focus on developing
proprietary drugs with our advanced polymer conjugate
technology.”
Research
and development expense was $24.2 million in the second quarter of 2009 as
compared to $33.5 million for the same quarter in 2008. For the first
half of 2009, research and development expense was $48.0 million as compared to
$70.9 million for the first half of 2008. Included in the $48.0
million of overall research and development expense in the first half of 2009 is
approximately $27.4 million of investment in Nektar preclinical and clinical
development programs.
Revenue
for the three month period ended June 30, 2009 was $13.0 million compared to
revenue of $20.4 million in the second quarter of 2008. Revenue for
the first half of 2009 was $22.7 million as compared to revenue of $40.4 million
in the first half of 2008. This decrease in revenue is primarily the
result of lower contract research and manufacturing revenues resulting from the
sale of certain of the company’s pulmonary assets to Novartis which occurred on
December 31, 2008.
Cash,
cash equivalents, and short-term investments at June 30, 2009 were $294.3
million.
Conference
Call to Discuss Second Quarter 2009 Financial Results
A
conference call to review results will be held on August 4, 2009 at 2 PM Pacific
Time.
Details
are below:
Howard
Robin, president and chief executive officer, and John Nicholson, chief
financial officer, will host a conference call beginning at 5:00 p.m. Eastern
Time (ET)/2:00 p.m. Pacific Time (PT) on Tuesday, August 4, 2009.
To
access the conference call, follow these instructions:
Dial:
(866) 831-6270 (U.S.); (617) 213-8858 (international)
Passcode:
25099763 (Howard Robin is the host)
An audio
replay will also be available shortly following the call through Wednesday,
August 19, 2009 and can be accessed by dialing (888) 286-8010 (U.S.); or (617)
801-6888 (international) with a passcode of 26851386.
About
Nektar
Nektar
Therapeutics is a biopharmaceutical company developing novel therapeutics based
on its PEGylation and advanced polymer conjugation technology platforms.
Nektar's technology and drug development expertise have enabled nine approved
products for partners, which include leading biopharmaceutical companies. Nektar
is also developing a robust pipeline of its own potentially high-value
therapeutics to address unmet medical needs by leveraging and expanding its
technology platforms to improve and enable molecules.
The
company recently announced positive Phase 2 results for Oral NKTR-118, its
proprietary novel peripheral opioid antagonist that combines Nektar's advanced
small molecule polymer conjugate technology platform with naloxol, a derivative
of the opioid-antagonist drug, naloxone. Nektar's technology has been shown to
increase oral bioavailability and inhibit penetration across the blood-brain
barrier, an important potential advance for small molecule therapies. The
product is being developed to treat opioid-induced constipation
(OIC).
NKTR-102,
PEGylated irinotecan, is currently in Phase 2 clinical studies in ovarian,
breast and colorectal cancer. NKTR-105, PEGylated docetaxel, is currently in a
Phase 1 study in patients with refractory solid tumors.
Nektar
technology is used in nine approved partnered products in the U.S. or Europe
today, including UCB's Cimzia(R), Roche's PEGASYS(R) for hepatitis C and Amgen's
Neulasta(R) for neutropenia.
Nektar is
headquartered in San Carlos, California, with additional R&D operations in
Huntsville, Alabama and Hyderabad, India.
# #
#
This
press release contains forward-looking statements that reflect management’s
current views regarding the progress and potential of the company's pipeline of
proprietary drug candidates, the value and potential of the company's technology
platform, and the company’s position to enter into new strategic collaborations
with third parties. These forward-looking statements involve numerous
risks and uncertainties, including but not limited to: (i) the company's
proprietary product candidates and those of its collaboration partners are in
various stages of clinical development and the risk of failure is high and can
unexpectedly occur at any stage of development prior to regulatory approval for
numerous reasons including, without limitation, safety and efficacy findings;
(ii) the timing or success of the commencement or end of clinical trials and
commercial launch of partnered products may be delayed or unsuccessful due to
slower than anticipated patient enrollment, drug manufacturing challenges,
changing standards of care, clinical trial design, clinical outcomes, or delay
or failure in obtaining regulatory approval in one or more important markets;
(iii) the company's patent applications for its proprietary or partner product
candidates may not issue, patents that have issued may not be enforceable, or
intellectual property licenses from third parties may be required in the future;
(iv) the outcome of any future intellectual property or other litigation related
to the company's proprietary product candidates or complex commercial
agreements; (v) if the company is unable to establish and maintain collaboration
partnerships on attractive commercial terms, or that cover all major markets,
our business, results of operations and financial condition could suffer; (vi) advances by
competitors, particularly if unanticipated; and (vii) certain other
important risks and uncertainties set forth in the company’s Annual Report on
Form 10-K filed with the Securities and Exchange Commission on March 6, 2009,
the company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2009
filed with the Securities and Exchange Commission on May 8, 2009, and
the company’s most recent Quarterly Report on Form 10-Q to be filed on or about
August 5, 2009. Actual results could differ materially from the
forward-looking statements contained in this press release. The company
undertakes no obligation to update forward-looking statements, whether as a
result of new information, future events or otherwise.
Contacts:
Jennifer
Ruddock
Nektar
Therapeutics
650-631-4954
Susan
Noonan
The SAN
Group
212-966-3650
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NEKTAR
THERAPEUTICS
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
(In
thousands)
|
|
(unaudited)
|
|
June 30, 2009
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December 31, 2008 (1)
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|||||||
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ASSETS
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||||||||
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Current
assets:
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||||||||
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Cash
and cash equivalents
|
$ | 114,992 | $ | 155,584 | ||||
|
Short-term
investments
|
179,311 | 223,410 | ||||||
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Accounts
receivable, net of allowance
|
8,473 | 11,161 | ||||||
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Inventory
|
10,110 | 9,319 | ||||||
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Other
current assets
|
5,317 | 6,746 | ||||||
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Total
current assets
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$ | 318,203 | $ | 406,220 | ||||
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Property
and equipment, net
|
75,024 | 73,578 | ||||||
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Goodwill
|
76,501 | 76,501 | ||||||
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Other
assets
|
3,270 | 4,237 | ||||||
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Total assets
|
$ | 472,998 | $ | 560,536 | ||||
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LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||
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Current
liabilities:
|
||||||||
|
Accounts
payable
|
$ | 4,931 | $ | 13,832 | ||||
|
Accrued
compensation
|
6,883 | 11,570 | ||||||
|
Accrued
clinical trial expenses
|
12,110 | 17,622 | ||||||
|
Accrued
expenses
|
7,201 | 9,923 | ||||||
|
Deferred
revenue, current portion
|
8,770 | 10,010 | ||||||
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Other
current liabilities
|
5,421 | 5,417 | ||||||
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Total
current liabilities
|
$ | 45,316 | $ | 68,374 | ||||
|
Convertible
subordinated notes
|
214,955 | 214,955 | ||||||
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Capital
lease obligations
|
19,616 | 20,347 | ||||||
|
Deferred
revenue
|
52,696 | 55,567 | ||||||
|
Deferred
gain
|
5,463 | 5,901 | ||||||
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Other
long-term liabilities
|
4,354 | 5,238 | ||||||
|
Total
liabilities
|
$ | 342,400 | $ | 370,382 | ||||
|
Commitments
and contingencies
|
||||||||
|
Stockholders'
equity:
|
||||||||
|
Preferred
stock
|
$ | - | $ | - | ||||
|
Common
stock
|
9 | 9 | ||||||
|
Capital
in excess of par value
|
1,317,577 | 1,312,796 | ||||||
|
Accumulated
other comprehensive income
|
978 | 1,439 | ||||||
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Accumulated
deficit
|
(1,187,966 | ) | (1,124,090 | ) | ||||
|
Total
stockholders' equity
|
$ | 130,598 | $ | 190,154 | ||||
|
Total
liabilities and stockholders' equity
|
$ | 472,998 | $ | 560,536 | ||||
(1) The
consolidated balance sheet at December 31, 2008 has been derived from the
audited financial statements at that date but does not include all of the
information and notes required by generally accepted accounting principles in
the United States for complete financial statements.
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NEKTAR
THERAPEUTICS
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
(In
thousands, except per share information)
|
|
(unaudited)
|
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
|
June 30,
|
June 30,
|
|||||||||||||||
|
2009
|
2008
|
2009
|
2008
|
|||||||||||||
|
Revenue:
|
||||||||||||||||
|
Product
sales and royalties
|
$ | 10,525 | $ | 9,010 | $ | 16,995 | $ | 19,381 | ||||||||
|
Collaboration
and other
|
2,463 | 11,391 | 5,704 | 21,012 | ||||||||||||
|
Total
revenue
|
12,988 | 20,401 | 22,699 | 40,393 | ||||||||||||
|
Operating
costs and expenses:
|
||||||||||||||||
|
Cost
of goods sold
|
10,231 | 5,444 | 15,330 | 12,671 | ||||||||||||
|
Other
cost of revenue
|
- | 1,487 | - | 6,821 | ||||||||||||
|
Research
and development
|
24,150 | 33,500 | 48,040 | 70,873 | ||||||||||||
|
General
and administrative
|
9,087 | 13,328 | 20,107 | 25,275 | ||||||||||||
|
Total
operating costs and expenses
|
43,468 | 53,759 | 83,477 | 115,640 | ||||||||||||
|
Loss
from operations
|
(30,480 | ) | (33,358 | ) | (60,778 | ) | (75,247 | ) | ||||||||
|
Non-operating
income (expense):
|
||||||||||||||||
|
Interest
income
|
950 | 3,190 | 2,600 | 8,203 | ||||||||||||
|
Interest
expense
|
(2,948 | ) | (3,929 | ) | (6,285 | ) | (7,847 | ) | ||||||||
|
Other
income, net
|
203 | 769 | 248 | 1,071 | ||||||||||||
|
Total
non-operating income (expense)
|
(1,795 | ) | 30 | (3,437 | ) | 1,427 | ||||||||||
|
Loss
before provision for income taxes
|
(32,275 | ) | (33,328 | ) | (64,215 | ) | (73,820 | ) | ||||||||
|
(Benefit)
provision for income taxes
|
(206 | ) | 47 | (339 | ) | 260 | ||||||||||
|
Net
loss
|
$ | (32,069 | ) | $ | (33,375 | ) | $ | (63,876 | ) | $ | (74,080 | ) | ||||
|
Basic
and diluted net loss per share
|
$ | (0.35 | ) | $ | (0.36 | ) | $ | (0.69 | ) | $ | (0.80 | ) | ||||
|
Shares
used in computing basic and diluted net loss per share
|
92,556 | 92,400 | 92,536 | 92,365 | ||||||||||||
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NEKTAR
THERAPEUTICS
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(In
thousands)
|
|
(unaudited)
|
|
Six Months Ended June 30,
|
||||||||
|
2009
|
2008
|
|||||||
|
Cash
flows from operating activities:
|
||||||||
|
Net
loss
|
$ | (63,876 | ) | $ | (74,080 | ) | ||
|
Adjustments
to reconcile net loss to net cash used in operating
activities:
|
||||||||
|
Depreciation
and amortization
|
7,359 | 11,820 | ||||||
|
Stock-based
compensation
|
4,691 | 3,863 | ||||||
|
Other
non-cash transactions
|
56 | (309 | ) | |||||
|
Changes
in assets and liabilities:
|
||||||||
|
Decrease
(increase) in trade accounts receivable
|
2,362 | 9,570 | ||||||
|
Decrease
(increase) in inventory
|
(791 | ) | 2,021 | |||||
|
Decrease
(increase) in other assets
|
1,284 | (6,026 | ) | |||||
|
Increase
(decrease) in accounts payable
|
(5,513 | ) | (1,727 | ) | ||||
|
Increase
(decrease) in accrued compensation
|
(4,687 | ) | (3,676 | ) | ||||
|
Increase
(decrease) in accrued clinical trial expenses
|
(5,512 | ) | 10,160 | |||||
|
Increase
(decrease) in accrued expenses
|
(1,344 | ) | (1,061 | ) | ||||
|
Increase
(decrease) in accrued expenses to contract manufacturers
|
- | (40,444 | ) | |||||
|
Increase
(decrease) in deferred revenue
|
(4,111 | ) | (5,321 | ) | ||||
|
Increase
(decrease) in other liabilities
|
(995 | ) | (1,215 | ) | ||||
|
Net
cash used in operating activities
|
$ | (71,077 | ) | $ | (96,425 | ) | ||
|
Cash
flows from investing activities:
|
||||||||
|
Purchases
of investments
|
(186,016 | ) | (334,685 | ) | ||||
|
Sales
of investments
|
7,627 | 28,590 | ||||||
|
Maturities
of investments
|
221,948 | 369,337 | ||||||
|
Transaction
costs from Novartis pulmonary asset sale
|
(4,440 | ) | - | |||||
|
Purchases
of property and equipment
|
(7,999 | ) | (10,349 | ) | ||||
|
Net
cash provided by investing activities
|
$ | 31,120 | $ | 52,893 | ||||
|
Cash
flows from financing activities:
|
||||||||
|
Payments
of loan and capital lease obligations
|
(616 | ) | (1,151 | ) | ||||
|
Proceeds
from issuances of common stock
|
90 | 383 | ||||||
|
Net
cash used in financing activities
|
$ | (526 | ) | $ | (768 | ) | ||
|
Effect
of exchange rates on cash and cash equivalents
|
(109 | ) | (164 | ) | ||||
|
Net
decrease in cash and cash equivalents
|
$ | (40,592 | ) | $ | (44,464 | ) | ||
|
Cash
and cash equivalents at beginning of period
|
155,584 | 76,293 | ||||||
|
Cash
and cash equivalents at end of period
|
$ | 114,992 | $ | 31,829 | ||||