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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, 2005
NEKTAR THERAPEUTICS
(Exact name of Registrant as specified in its charter)
Delaware 0-24006 94-3134940
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
150 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)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] 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 Results of Operations and Financial Condition.
On August 4, 2005, Nektar Therapeutics issued a press release (the "Press
Release") announcing results for the three-month and six-month periods ended
June 30, 2005. A copy of the Press Release is attached as Exhibit 99.1 to this
Current Report and is incorporated herein by reference.
The information in this report, including the exhibit hereto, 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.
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.
By: /s/ AJIT S. GILL
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Ajit S. Gill
Chief Executive Officer,
President and Director
Date: August 4, 2005
By: /s/ AJAY BANSAL
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Ajay Bansal
Chief Financial Officer and Vice
President, Finance and Administration
Date: August 4, 2005
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
99.1 Earnings Press Release of Nektar Therapeutics dated August 4, 2005.
Exhibit 99.1
Nektar Announces Second Quarter 2005 Results
SAN CARLOS, Calif.--(BUSINESS WIRE)--Aug. 4, 2005--Nektar
Therapeutics (Nasdaq:NKTR) announced today its financial results for
the second quarter ended June 30, 2005.
The company reported revenue of $28.6 million for the three months
ended June 30, 2005, compared to $28.5 million for the three months
ended June 30, 2004. In the second quarter of 2005, product and
royalty revenue was $5.5 million compared to $6.4 million in 2004, and
contract research revenue totaled $19.6 million compared to $22.1
million in the second quarter of 2004. Nektar also reported that in
the second quarter of 2005 the company received $3.5 million from
Pfizer for Exubera(R) (inhaled insulin) commercialization readiness
for reimbursement of certain agreed upon operating costs related to
the Exubera drug powder manufacturing facility in preparation for
commercial production.
Nektar reported a net loss of $26.9 million or $(0.32) per share
for the three months ended June 20, 2005 compared to a net loss of
$22.2 million or $(0.27) per share for the three months ended June 30,
2004.
For the six months ended June 30, 2005, Nektar reported total
revenue of $57.0 million compared to $54.4 million for the six months
ended June 30, 2004. For the six months ended June 30, 2005, product
and royalty revenue was $11.9 million compared to $10.7 million for
the six months ended June 30, 2004, and contract research revenue
totaled $39.1 million compared to $43.6 million for the six months
ended June 30, 2004. Exubera commercialization readiness revenue
totaled $6.1 million for the first six months of 2005.
For the six months ended June 30, 2005, Nektar reported a net loss
of $53.1 million or $(0.63) per share compared to a net loss for the
six months ended June 30, 2004 of $62.2 million or $(0.85) per share.
As of June 30, 2005, the company reported cash, cash equivalents
and short-term investments of approximately $378.5 million compared to
$401.3 million as of March 31, 2005.
Summary of Progress
FDA Sets Exubera Advisory Committee Date
"We were pleased to note that the Food and Drug Administration
(FDA) has set the date of September 8, 2005 for the Endocrinologic and
Metabolic Drugs Advisory Committee meeting to discuss the New Drug
Application for Exubera. This is another significant announcement for
this important product," said Ajit S. Gill, president and CEO of
Nektar.
Nektar developed the inhalers and the powdered insulin formulation
for the Exubera product, a joint-development program between Pfizer
Inc. and the sanofi-aventis Group.
Encouraging Exubera Data Presented During Second Quarter
Results from three two-year studies presented in June 2005 at the
65th Annual Scientific Sessions of the American Diabetes Association
showed that Exubera, an inhaleable, short-acting, dry powder insulin,
provided effective, sustained glycemic control and was well tolerated
over two years in adults with type 2 diabetes. A fourth study showed
that three months of Exubera therapy was well tolerated and as
effective as subcutaneous (injectable) short-acting insulin in
achieving tight glycemic control in adults with type 1 diabetes.
Progress with Selected Partnered Products
-- On July 26, 2005, UCB Pharma announced the preliminary results
of two pivotal Phase III trials for Cimzia(TM), formerly
CDP870, in the treatment of Crohn's disease. The trials
compared Cimzia to placebo in 1,330 patients over a period of
26 weeks and data demonstrated that Cimzia was well-tolerated
and met primary endpoints. Cimzia uses Nektar PEGylation
Technology.
-- UCB Pharma also announced that CDP791 successfully completed
Phase I. Phase II trials for non-small cell lung cancer will
start in the next few weeks. Another product, CDP484 is on
hold after Phase I studies failed to meet the criteria to
proceed. Both of these products use Nektar PEGylation
Technology.
-- On June 6, 2005, Roche announced new data from a year-long
Phase II study that show that Roche's CERA (Continuous
Erythropoietin Receptor Activator) to treat renal anemia,
provided sustained and stable control of hemoglobin levels
with dosing intervals up to four weeks in dialysis patients
who suffer from anemia.(1) CERA uses Nektar PEGylation
Technology.
Conference Call
Ajit S. Gill will host a conference call for analysts and
investors today beginning at 2:00 p.m. Pacific Time, to discuss
further the company's performance.
Investors can access a live audio-only webcast through a link that
is posted on the Investor Relations section of Nektar's website at
http://www.nektar.com. The web broadcast of the conference call will
be available for replay through August 18, 2005.
Analysts and investors can also access the conference call live
via telephone by dialing (877) 691-2551 (U.S.); (630) 691-2747
(International). The passcode is 12290907 and the host is Mr. Ajit
Gill. An audio replay will be available shortly following the call
through August 18, 2005 and can be accessed by dialing (877) 213-9653
(U.S.); or (630) 652-3041 (International) with a passcode of 12290907.
In the event that any non-GAAP financial measure is discussed on the
conference call that is not described in the press release, related
information will be made available on the Investor Relations page at
the Nektar website as soon as practical after the conclusion of the
conference call.
About Nektar
Nektar Therapeutics enables high-value, differentiated
therapeutics with its industry-leading drug delivery technologies,
expertise and manufacturing capabilities. The world's top
biotechnology and pharmaceutical companies are developing new and
better therapeutics using Nektar's advanced technologies and know-how.
Nektar also develops its own products by applying its drug delivery
technologies and its expertise to existing medicines to enhance
performance, such as improving efficacy, safety and compliance.
This release contains forward-looking information about a product
candidate which is under review by the United States Food and Drug
Administration and the European Medicines Evaluation Agency that
involves substantial risks and uncertainties. Such risks and
uncertainties include, among other things, whether and when such
regulatory authorities will approve the product candidate, their
decisions regarding labeling and other matters that could affect its
commercial potential as well as competitive developments.
This release contains forward-looking statements that reflect
management's current views as to Nektar's business strategy, product
and technology development plans and funding, collaborative
arrangements, clinical trials, developments in connection with the
regulatory approval process for Exubera, including an upcoming meeting
of an FDA Advisory Committee, meetings with the FDA's advisory
committee and other future events and operations. These
forward-looking statements involve uncertainties and other risks that
are detailed in Nektar's reports and other filings with the SEC,
including its Annual Report on Form 10-K, as amended, for the year
ended December 2004 and its Quarterly Report on 10-Q for the quarter
ended March 31, 2005. Actual results could differ materially from
these forward-looking statements.
(1) Locatellis, Francesco et al. Subcutaneous CERA (Continuous
Erythropoietin Receptor Activator) Maintains Hemoglobin Concentrations
With Dosing Intervals Up to 4 Weeks In Dialysis Patients. ERA-EDTA
2005.
NEKTAR THERAPEUTICS
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
( In thousands, except per share information)
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ------------------
2005 2004 2005 2004
-------- -------- -------- --------
(unaudited) (unaudited)
Revenue:
Contract research
revenue $ 19,552 $ 22,102 $ 39,081 $ 43,611
Product sales and
royalty revenue 5,470 6,425 11,862 10,747
Exubera(R)
commercialization
readiness revenue 3,528 - 6,101 -
-------- -------- -------- --------
Total revenue 28,550 28,527 57,044 54,358
Operating costs and
expenses:
Cost of goods sold 5,433 6,733 10,688 9,269
Exubera(R)
commercialization
readiness costs 2,666 - 4,960 -
Research and
development 35,785 33,650 70,730 64,942
General and
administrative 10,135 8,072 19,245 14,900
Amortization of other
intangible assets 981 981 1,963 1,962
-------- -------- -------- --------
Total operating costs and
expenses 55,000 49,436 107,586 91,073
-------- -------- -------- --------
Loss from operations (26,450) (20,909) (50,542) (36,715)
Gain/(loss) on
extinguishment of debt - - - (9,258)
Other income/
(expense), net (118) 124 (1,403) 431
Interest income 2,512 1,608 4,784 2,854
Interest expense (2,856) (2,987) (5,916) (19,344)
-------- -------- -------- --------
Net loss before provision
for income taxes (26,912) (22,164) (53,077) (62,032)
Provision for income
taxes - - - 132
-------- -------- -------- --------
Net loss $(26,912) $(22,164) $(53,077) $(62,164)
======== ======== ======== ========
Basic and diluted net
loss per common share $ (0.32) $ (0.27) $ (0.63) $ (0.85)
======== ======== ======== ========
Shares used in computing
basic and diluted net loss
per common share 85,040 83,501 84,875 72,858
======== ======== ======== ========
NEKTAR THERAPEUTICS
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
June 30, December 31,
2005 2004
(unaudited) (2)
----------- -----------
ASSETS
Current assets:
Cash, cash equivalents and short-term
investments $ 378,507 $ 418,740
Inventory 12,781 10,691
Other current assets 19,994 25,108
---------- ----------
Total current assets 411,282 454,539
Property and equipment, net 146,371 151,247
Goodwill 129,986 130,120
Other intangible assets 4,202 6,456
Deposits and other assets 2,214 2,559
---------- ----------
$ 694,055 $ 744,921
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 26,372 $ 24,231
Capital lease obligations - current 408 1,532
Deferred revenue 27,764 29,890
---------- ----------
Total current liabilities 54,544 55,653
Convertible subordinated debentures 173,949 173,949
Accrued rent 2,087 2,117
Capital lease obligations - noncurrent 20,536 23,568
Other long-term liabilities 21,615 22,292
Stockholders' equity:
Preferred stock at par - -
Common stock at par 9 8
Capital in excess of par 1,196,277 1,187,575
Deferred compensation (3,897) (2,764)
Accumulated other comprehensive gain/(loss) (867) (356)
Accumulated deficit (770,198) (717,121)
---------- ----------
Total stockholders' equity 421,324 467,342
---------- ----------
$ 694,055 $ 744,921
========== ==========
(2) The balance sheet at December 31, 2004 has been derived from the
audited financial statements at that date but does not include all of
the information and footnotes required by accounting principles
generally accepted in the United States for complete financial
statements.
CONTACT: Nektar Therapeutics
Joyce Strand, 650-631-3138
Jennifer Ruddock, 650-631-4954