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| 8-K - NEKTAR THERAPEUTICS | v191591_8-k.htm |
Exhibit 99.1
News
Release
Nektar
Therapeutics Reports Second Quarter 2010 Financial Results
SAN CARLOS, Calif., July 28,
2010 — Nektar Therapeutics (Nasdaq: NKTR) today reported its financial
results for the second quarter ended June 30, 2010.
Cash,
cash equivalents, and short-term investments at June 30, 2010 were $338.2
million as compared to $362.0 million at March 31, 2010.
Revenue
for the second quarter of 2010 increased to $42.6 million as compared to $13.0
million in the second quarter of 2009. The increase in revenue year
over year is largely the result of the amortization of the $125 million
milestone payment received from AstraZeneca in September 2009 under the new
partnership agreement for NKTR-118.
Total
operating costs and expenses in the second quarter of 2010 declined by 6% to
$40.7 million, compared to $43.5 million in the second quarter
2009.
Research
and development expense increased to $25.6 million in the second quarter 2010 as
compared to $24.0 million for the same quarter in 2009. General and
administrative expense was $10.2 million in the second quarter 2010 as compared
to $9.1 million in the second quarter of 2009.
“The
number of drug candidates advanced by Nektar in just three years highlights the
unique potential of our polymer conjugation technology to create a steady stream
of valuable product opportunities,” said Howard W. Robin, President and Chief
Executive Officer of Nektar. “In the second quarter, we reported compelling
Phase 2 data for our lead oncology compound, NKTR-102, in both ovarian and
breast cancer patients. With a deep pipeline in various stages of development,
ranging from preclinical compounds to candidates preparing for Phase 3, Nektar
is well-positioned for continued success in 2010.”
Net loss
for the second quarter ended June 30, 2010 was $0.5 million or $0.01 per share
as compared to a net loss of $32.1 million or $0.35 per share in the second
quarter of 2009.
Conference
Call to Discuss Second Quarter 2010 Financial Results
A
conference call to review results will be held today, Wednesday, July 28, 2010
at 2 PM Pacific Time. To access the conference call, follow these
instructions:
Dial:
(866) 788-0541 (U.S.); (857) 350-1679 (international)
Passcode:
96449158
An audio
replay will also be available shortly following the call through Thursday,
August
12, 2010 and can be accessed by dialing (888) 286-8010 (U.S.); or (617) 801-6888
(international) with a passcode of 67523786.
In the
event that any non-GAAP financial measure is discussed on the conference call
that is not described in the press release, or explained on the conference call,
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 is a biopharmaceutical company developing novel therapeutics based
on its PEGylation and advanced polymer conjugation technology platforms. Nektar
has a robust R&D pipeline of potentially high-value therapeutics in
oncology, pain and other areas. In the area of pain, Nektar has an exclusive
worldwide license agreement with AstraZeneca for Nektar’s oral NKTR-118
development program to treat opioid-induced constipation and its NKTR-119
development program for the treatment of pain without constipation side
effects. The company has additional pain compounds in preclinical
studies. In oncology, NKTR-102, a novel topoisomerase I-inhibitor, is
being evaluated in Phase 2 clinical studies for the treatment of ovarian, breast
and colorectal cancers. NKTR-105, a novel anti-mitotic agent, is in a Phase 1
clinical study in cancer patients with refractory solid tumors.
Nektar's
technology has enabled nine approved products in the U.S. or Europe through
partnerships with leading biopharmaceutical companies, including UCB's Cimzia(R)
for Crohn's disease and rheumatoid arthritis, 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. Further information about the company
and its drug development programs and capabilities may be found online at http://www.nektar.com.
This
press release contains forward-looking statements that reflect management's
current views regarding the progress and potential of Nektar's pipeline of
proprietary drug candidates, the value and potential of the Nektar's technology
platform, and the value and potential of certain of Nektar's collaborations with
third parties. These forward-looking statements involve numerous risks and
uncertainties, including but not limited to: (i) Nektar'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 even after
initial preclinical and clinical results have been positive; (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)
Nektar's patent applications for its proprietary or partner product candidates
may not issue, patents that have issued may not be enforceable, or additional
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 Nektar's proprietary product candidates or complex commercial agreements; (v)
if Nektar is unable to establish and maintain collaboration partnerships on
attractive commercial terms, our business, results of operations and financial
condition could suffer; and (vi) certain other
important risks and uncertainties set forth in Nektar's Quarterly Report on Form
10-Q for the quarter ended June 30, 2010 to be filed on or about July 28, 2010,
the Current Report on Form 8-K filed today, and the most recent Quarterly
Report on Form 10-Q for the quarter ended March 31, 2010 filed on May 5,
2010. Actual results could differ materially from the forward-looking
statements contained in this press release. Nektar undertakes no
obligation to update forward-looking statements, whether as a result of new
information, future events or otherwise.
Nektar
Investor Inquiries:
Jennifer
Ruddock/Nektar Therapeutics
(650)
631-4954
Susan
Noonan/SA Noonan Communications, LLC
(212)
966-3650
Nektar
Media Inquiries:
Karen
Bergman/BCC Partners
(650)
575-1509
Michelle
Corral/BCC Partners
(415)
794-8662
#
# #
CONDENSED
CONSOLIDATED BALANCE SHEETS
(In
thousands)
(Unaudited)
|
June 30, 2010
|
December 31, 2009 (1)
|
|||||||
|
ASSETS
|
||||||||
|
Current
assets:
|
||||||||
|
Cash
and cash equivalents
|
$ | 23,244 | $ | 49,597 | ||||
|
Short-term
investments
|
314,976 | 346,614 | ||||||
|
Accounts
receivable
|
9,446 | 4,801 | ||||||
|
Inventory
|
9,777 | 6,471 | ||||||
|
Other
current assets
|
6,363 | 6,183 | ||||||
|
Total
current assets
|
$ | 363,806 | $ | 413,666 | ||||
|
Property
and equipment, net
|
88,223 | 78,263 | ||||||
|
Goodwill
|
76,501 | 76,501 | ||||||
|
Other
assets
|
2,108 | 7,088 | ||||||
|
Total assets
|
$ | 530,638 | $ | 575,518 | ||||
|
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||
|
Current
liabilities:
|
||||||||
|
Accounts
payable
|
$ | 4,627 | $ | 3,066 | ||||
|
Accrued
compensation
|
7,908 | 10,052 | ||||||
|
Accrued
expenses
|
10,189 | 4,354 | ||||||
|
Accrued
clinical trial expenses
|
13,349 | 14,167 | ||||||
|
Deferred
revenue, current portion
|
65,342 | 115,563 | ||||||
|
Other
current liabilities
|
6,051 | 5,814 | ||||||
|
Total
current liabilities
|
$ | 107,466 | $ | 153,016 | ||||
|
Convertible
subordinated notes
|
214,955 | 214,955 | ||||||
|
Capital
lease obligations
|
17,887 | 18,800 | ||||||
|
Deferred
revenue
|
71,910 | 76,809 | ||||||
|
Deferred
gain
|
4,589 | 5,027 | ||||||
|
Other
long-term liabilities
|
4,302 | 4,544 | ||||||
|
Total
liabilities
|
$ | 421,109 | $ | 473,151 | ||||
|
Commitments
and contingencies
|
||||||||
|
Stockholders'
equity:
|
||||||||
|
Preferred
stock
|
$ | - | $ | - | ||||
|
Common
stock
|
9 | 9 | ||||||
|
Capital
in excess of par value
|
1,342,195 | 1,327,942 | ||||||
|
Accumulated
other comprehensive income
|
581 | 1,025 | ||||||
|
Accumulated
deficit
|
(1,233,256 | ) | (1,226,609 | ) | ||||
|
Total
stockholders' equity
|
$ | 109,529 | $ | 102,367 | ||||
|
Total
liabilities and stockholders' equity
|
$ | 530,638 | $ | 575,518 | ||||
(1) The
consolidated balance sheet at December 31, 2009 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.
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(In
thousands, except per share information)
(Unaudited)
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
|
June 30,
|
June 30,
|
|||||||||||||||
|
2010
|
2009
|
2010
|
2009
|
|||||||||||||
|
Revenue:
|
||||||||||||||||
|
Product
sales and royalties
|
$ | 11,154 | $ | 10,525 | $ | 14,738 | $ | 16,995 | ||||||||
|
License,
collaboration and other
|
31,409 | 2,463 | 61,062 | 5,704 | ||||||||||||
|
Total
revenue
|
42,563 | 12,988 | 75,800 | 22,699 | ||||||||||||
|
Operating
costs and expenses:
|
||||||||||||||||
|
Cost
of goods sold
|
4,889 | 10,379 | 9,185 | 16,005 | ||||||||||||
|
Research
and development
|
25,600 | 24,002 | 48,886 | 47,365 | ||||||||||||
|
General
and administrative
|
10,207 | 9,087 | 19,220 | 20,107 | ||||||||||||
|
Total
operating costs and expenses
|
40,696 | 43,468 | 77,291 | 83,477 | ||||||||||||
|
Income
(loss) from operations
|
1,867 | (30,480 | ) | (1,491 | ) | (60,778 | ) | |||||||||
|
Non-operating
income (expense):
|
||||||||||||||||
|
Interest
income
|
393 | 950 | 856 | 2,600 | ||||||||||||
|
Interest
expense
|
(2,909 | ) | (2,948 | ) | (5,860 | ) | (6,285 | ) | ||||||||
|
Other
income, net
|
163 | 203 | 187 | 248 | ||||||||||||
|
Total
non-operating expense
|
(2,353 | ) | (1,795 | ) | (4,817 | ) | (3,437 | ) | ||||||||
|
Loss
before provision (benefit) for income taxes
|
(486 | ) | (32,275 | ) | (6,308 | ) | (64,215 | ) | ||||||||
|
Provision
(Benefit) for income taxes
|
31 | (206 | ) | 339 | (339 | ) | ||||||||||
|
Net
loss
|
$ | (517 | ) | $ | (32,069 | ) | $ | (6,647 | ) | $ | (63,876 | ) | ||||
|
Basic
and diluted net loss per share
|
$ | (0.01 | ) | $ | (0.35 | ) | $ | (0.07 | ) | $ | (0.69 | ) | ||||
|
Shares
used in computing basic and diluted net loss per share
|
94,065 | 92,556 | 93,849 | 92,536 | ||||||||||||
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In
thousands)
(Unaudited)
|
Six Months Ended June 30,
|
||||||||
|
2010
|
2009
|
|||||||
|
Cash
flows from operating activities:
|
||||||||
|
Net
loss
|
$ | (6,647 | ) | $ | (63,876 | ) | ||
|
Adjustments
to reconcile net loss to net cash used in operating
activities:
|
||||||||
|
Depreciation
and amortization
|
8,334 | 7,359 | ||||||
|
Stock-based
compensation
|
8,105 | 4,691 | ||||||
|
Deferred
rent
|
542 | - | ||||||
|
Other
non-cash transactions
|
(747 | ) | 56 | |||||
|
Changes
in operating assets and liabilities:
|
||||||||
|
Accounts
receivable
|
(4,645 | ) | 2,362 | |||||
|
Inventory
|
(3,306 | ) | (791 | ) | ||||
|
Other
assets
|
(136 | ) | 1,284 | |||||
|
Accounts
payable
|
2,183 | (5,513 | ) | |||||
|
Accrued
compensation
|
(2,144 | ) | (4,687 | ) | ||||
|
Accrued
expenses
|
1,012 | (1,344 | ) | |||||
|
Accrued
clinical trial expenses
|
(818 | ) | (5,512 | ) | ||||
|
Deferred
revenue
|
(55,120 | ) | (4,111 | ) | ||||
|
Other
liabilities
|
(729 | ) | (995 | ) | ||||
|
Net
cash used in operating activities
|
$ | (54,116 | ) | $ | (71,077 | ) | ||
|
Cash
flows from investing activities:
|
||||||||
|
Purchases
of investments
|
(218,275 | ) | (186,016 | ) | ||||
|
Sales
of investments
|
8,197 | 7,627 | ||||||
|
Maturities
of investments
|
241,256 | 221,948 | ||||||
|
Transaction
costs from Novartis pulmonary asset sale
|
- | (4,440 | ) | |||||
|
Purchases
of property and equipment
|
(8,796 | ) | (7,999 | ) | ||||
|
Net
cash provided by investing activities
|
$ | 22,382 | $ | 31,120 | ||||
|
Cash
flows from financing activities:
|
||||||||
|
Payments
of loan and capital lease obligations
|
(731 | ) | (616 | ) | ||||
|
Proceeds
from issuances of common stock
|
6,148 | 90 | ||||||
|
Net
cash provided by (used in) financing activities
|
$ | 5,417 | $ | (526 | ) | |||
|
Effect
of exchange rates on cash and cash equivalents
|
(36 | ) | (109 | ) | ||||
|
Net
decrease in cash and cash equivalents
|
$ | (26,353 | ) | $ | (40,592 | ) | ||
|
Cash
and cash equivalents at beginning of period
|
49,597 | 155,584 | ||||||
|
Cash
and cash equivalents at end of period
|
$ | 23,244 | $ | 114,992 | ||||