SAN CARLOS, Calif., May 7, 2008 /PRNewswire-FirstCall via COMTEX News Network/ -- Nektar Therapeutics (Nasdaq: NKTR) announced today the company's financial results for the first quarter ended March 31, 2008.
Cash, cash equivalents, and short-term investments were $412.6 million at March 31, 2008 compared to $482.4 million at December 31, 2007.
Nektar reported a net loss of $40.7 million or $0.44 per share in the first quarter of 2008, compared to a net loss of $25.7 million or $0.28 per share in the first quarter of 2007. The increase in net loss is primarily the result of $4.1 million of expense for maintaining third-party Exubera manufacturing capacity, $5.3 million of expense for our workforce reduction, loss of gross margin associated with Pfizer's termination of the Exubera relationship, as well as significant incremental investment in clinical development programs. Offsetting these expenses are substantial operating efficiencies Nektar has achieved over the last twelve months.
Revenue totaled $20.0 million in the first quarter of 2008 compared to $85.0 million in the first quarter of 2007. This decrease is the result of the termination of Exubera by Pfizer.
"The first quarter was significant for Nektar as it represents the first time that the company has made substantial investment into the clinical development of innovative proprietary drug candidates," said Howard W. Robin, President and Chief Executive Officer. "Today we have moved past inhaled insulin, and our proprietary small molecule PEGylation drug development platform is generating a great deal of industry and scientific interest. We intend to build and advance our impressive pipeline while continuing to exercise financial responsibility."
Mr. Robin will host a conference call today for analysts and investors beginning at 2:00 p.m. Pacific time to discuss the company's performance. This conference call will be available via webcast and can be accessed through a link that is posted on the Investor Relations section of the Nektar website, http://www.nektar.com. The web broadcast of the conference call will be available for replay through March 12, 2008.
To access the conference call, follow these instructions:
Dial: (866) 713-8562 (U.S.); (617) 597-5310 (international)
Passcode: 50572577 (Howard Robin is the host)
Audio replay dial-in and passcode:
Dial: (888) 286-8010 (U.S.) ;(617) 801-6888 (international)
Passcode: 73371402
About Nektar
Nektar Therapeutics is a biopharmaceutical company that develops and enables differentiated therapeutics with its industry-leading PEGylation and pulmonary drug development 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 high-value therapeutics that addresses unmet medical needs by leveraging and expanding its technology platforms to improve known molecules.
This press release contains forward-looking statements that reflect the company's current views regarding the potential, progress, and clinical plans for the company's proprietary and partnered product pipeline, and the value and potential of the company's technology platforms. These forward-looking statements involve risks and uncertainties, including but not limited to: (i) the company's proprietary product candidates and those of its partners are in various stages of clinical development and the risk of failure is high and can occur at any stage prior to regulatory approval; (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) clinical trials are long, expensive and uncertain processes and the risk of failure of any product 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; (iv) 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; and (v) the outcome of any existing or future intellectual property or other litigation related to the company's proprietary product candidates. Other important risks and uncertainties are detailed in the company's reports and other filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K. 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.
Tim Warner, 650-283-4915
twarner@nektar.com
Stephan Herrera, 415-488-7699
sherrera@nektar.com
Jennifer Ruddock, 650-631-4954
jruddock@nektar.com
NEKTAR THERAPEUTICS
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share information)
(unaudited)
Three-Months Ended March 31,
2008 2007
Revenue:
Product sales and royalties $10,371 $73,019
Contract research 9,621 11,997
Total revenue 19,992 85,016
Operating costs and expenses:
Cost of goods sold 7,227 56,522
Cost of idle Exubera manufacturing
capacity 5,334 -
Research and development 37,373 37,492
General and administrative 11,711 16,735
Amortization of other intangible
assets 236 236
Total operating costs and expenses 61,881 110,985
Income (Loss) from operations (41,889) (25,969)
Non-Operating income (expense):
Interest income 5,013 5,473
Interest expense (3,918) (4,933)
Other Income 302 6
Total non-operating income 1,397 546
Income (Loss) before provision for
income taxes (40,492) (25,423)
Provision for income taxes 213 250
Net income (loss) $(40,705) $(25,673)
Basic and diluted net earnings (loss)
per share $(0.44) $(0.28)
Shares used in computing basic and
diluted net earnings (loss) per
share (3) 92,330 91,454
NEKTAR THERAPEUTICS
CONSOLIDATED BALANCE SHEETS
(In thousands)
(unaudited)
ASSETS March 31, December 31,
2008 2007(1)
Current assets:
Cash and cash equivalents $36,676 $76,293
Short-term investments 375,954 406,060
Accounts receivable, net of
allowance 14,040 21,637
Inventory 11,027 12,187
Other current assets 5,826 7,106
Total current assets 443,523 523,283
Property and equipment, net 114,381 114,420
Goodwill 78,431 78,431
Other intangible assets, net 2,444 2,680
Other assets 5,057 6,289
Total assets $643,836 $725,103
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $1,556 $3,589
Accrued compensation 10,884 14,680
Accrued expenses to contract
manufacturers 8,450 40,444
Accrued expenses 12,409 12,446
Interest payable 85 2,638
Capital lease obligations, current
portion 2,259 2,335
Deferred revenue, current portion 19,657 19,620
Other current liabilities 2,345 2,340
Total current liabilities 57,645 98,092
Convertible subordinated notes 315,000 315,000
Capital lease obligations 21,330 21,632
Deferred revenue 60,112 61,349
Other long-term liabilities 13,990 14,591
Total liabilites 468,077 510,664
Commitments and contingencies
Stockholders' equity:
Preferred stock - -
Common stock 9 9
Capital in excess of par value 1,303,996 1,302,541
Accumulated other comprehensive
income 2,213 1,643
Accumulated deficit (1,130,459) (1,089,754)
Total stockholders' equity 175,759 214,439
Total liabilities and
stockholders' equity $643,836 $725,103
(1) The consolidated balance sheet at December 31, 2007 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.
NEKTAR THERAPEUTICS
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, except per share information)
(unaudited)
Three-Months Ended March 31,
2008 2007
Cash flows provided by (used in)
operating activities:
Net loss $(40,705) $(25,673)
Adjustments to reconcile net loss to
net cash used in operating
activities:
Depreciation and amortization 5,917 7,571
Stock-based compensation 1,084 6,861
Amortization of gain related to sale
of building (219) (219)
Loss on sale or disposal of assets 107 304
Changes in assets and liabilities:
Decrease (increase) in trade accounts
receivable 7,597 (17,599)
Decrease (increase) in inventories 1,160 (2,114)
Decrease (increase) in other assets 2,044 3,227
Increase (decrease) in accounts
payable (2,033) (3,547)
Increase (decrease) in accrued
compensation (3,932) (1,635)
Increase (decrease) in accrued
expenses to contract manufacturers (31,994) -
Increase (decrease) in accrued
expenses (37) (2,604)
Increase (decrease) in interest
payable (2,553) (2,684)
Increase (decrease) in deferred
revenue (1,200) 8,801
Increase (decrease) in other
liabilities (208) 314
Net cash used in operating activities (64,972) (28,997)
Cash flows from investing activities:
Purchases of property and equipment (5,281) (5,556)
Purchases of investments (156,092) (79,411)
Maturities of investments 186,758 167,696
Net cash provided by investing
activities 25,385 82,729
Cash flows used in financing
activities:
Issuance of common stock 371 2,134
Payments of loan and capital lease
obligations (411) (400)
Repayments of convertible
subordinated notes - (36,026)
Net cash provided by (used in)
financing activities (40) (34,292)
Effect of exchange rates on cash and
cash equivalents 10 (60)
Net increase (decrease) in cash and
cash equivalents $(39,617) $19,380
Cash and cash equivalents at
beginning of period $76,293 $63,760
Cash and cash equivalents at end of
period $36,676 $83,140
SOURCE Nektar Therapeutics
http://www.nektar.com
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