Increased loss result of previously announced one-time charges
LANGLEY, BC, July 27 /PRNewswire-FirstCall/ -- AnorMED (TSX:AOM,
AMEX:AOM) today released its financial results for Q1 Fiscal 2007
ended June 30, 2006 and provided an update on upcoming milestones
based on the new strategic direction recently outlined by the
Board. The new strategy is designed to transform the Company from a
research focus into a successful, fully-integrated
biopharmaceutical company built around the timely development and
commercialization of MOZOBIL(TM) in order to maximize shareholder
value in both the near-term and long-term. Key Developments for the
First Quarter - Elected a new Board of Directors and adopted a new
strategic plan - We re-evaluated our European development and
commercialization plan and decided to pursue a full Marketing
Authorization Approval in Europe (E.U.) for MOZOBIL in stem cell
transplant. This will require a small development team for the E.U.
to allow the Company to initiate additional Phase II clinical
studies for MOZOBIL in the five major E.U. markets. Decision-making
about partnering arrangements for the E.U. was deferred until after
top-line data is available in 2007. In addition, development
spending was reallocated and new priorities for each development
program were re-established. - Completed 100% patient enrollment in
the Phase III trial for MOZOBIL in stem cell transplant in multiple
myeloma - On July 10, 2006 AnorMED announced that enrollment has
been completed for its Phase III multiple myeloma (MM) trial, one
of two pivotal Phase III trials being conducted with MOZOBIL for
stem cell transplant. "We are pleased with the performance of
management in implementing the Board's new strategic direction and
we expect that we will continue to meet or exceed our stated
corporate goals for the fiscal year," said Kenneth Galbraith,
AnorMED's Chairman and Acting Chief Executive Officer. "One-time
costs related to our Special Meeting of Shareholders held during
the quarter substantially increased our loss this quarter."
Upcoming Key Events/Milestones In implementing its new strategy the
Company expects the following key events and milestones to occur
over the next 12 months with the corresponding calendar quarter
indicated where appropriate: - Complete 100% patient enrollment in
the Phase III trial for MOZOBIL for non-Hodgkin's lymphoma (NHL) by
Q4 2006 - Initiate additional Phase II studies for MOZOBIL in
transplant indications in the U.S. by Q1 2007 and the E.U. by Q2
2007 - Announce top-line data for both Phase III trials for MOZOBIL
by Q2 2007 - Present additional Phase II data and host a Continuing
Medical Education symposium (CME) on MOZOBIL at the American
Society of Hematology (ASH) meeting scheduled to be held in
Orlando, Florida from December 9 to 13, 2006 - Initiate two pilot
studies for new MOZOBIL indications by Q1 2007 - Establish initial
Company development team in the E.U. for MOZOBIL by Q1 2007 -
Present AMD070 safety and activity data at the Conference on
Retroviruses and Opportunistic Infections scheduled to be held in
Los Angeles, California from February 25 to 28, 2007 - Report
progress towards selection of a lead CCR5 HIV inhibitor candidate
by Q4 2006 - Recruit a CEO and additional senior management during
2006 and 2007 to support development and commercialization of
MOZOBIL MOZOBIL Development MOZOBIL development continues to
progress on schedule with two Phase III trials ongoing at up to 45
transplant centers in the U.S, Canada and E.U. AnorMED announced
July 10, 2006 that the MM trial had completed its enrollment target
of 300 patients. As of July 26, 2006, 247 of the required 300
patients (or 82%) had been enrolled in the Phase III study of
patients with NHL. This study is progressing on schedule and we
still expect to complete the full enrollment of the NHL study in
2006 and announce top-line data for both trials by the second
calendar quarter of 2007. Plans are also underway to initiate a
series of additional Company-sponsored clinical studies in the U.S.
and E.U. involving MOZOBIL commencing in the first calendar quarter
of 2007. These studies will give physicians more experience using
MOZOBIL in transplant. In addition, trials are being planned to
investigate potential additional applications for MOZOBIL to
improve the effectiveness of chemotherapy for leukemia patients.
Additional development work for MOZOBIL including work on the
chemistry, manufacturing and controls section and the nonclinical
section of the New Drug Application (NDA) continues in preparation
for our NDA filing in 2007. MOZOBIL Commercial Strategy The Company
believes that the optimal global commercial strategy for MOZOBIL is
a combination of direct marketing by AnorMED sales forces and the
use of local distributors and regional partners. We will continue
to evaluate partnering options for MOZOBIL but will likely not
complete any arrangements until after top-line data from the two
Phase III trials is available. In the near-term, the commercial
strategy will involve U.S. based key market research activities
which will be implemented over the next 12 months including: the
completion of retrospective Health Economic chart reviews for
MOZOBIL, a scheduled ASH CME symposium and a planned CME symposium
at the upcoming Tandem Transplant meeting. In the E.U. key
precommercial activities include the completion of a qualitative
market research project and the execution of the E.U. publication
plan including a symposium at the European Bone Marrow Transplant
Meeting. AMD070 Development The ongoing proof-of-principle clinical
study of AMD070 in HIV patients (XACT) is continuing to accrue
patients at one site in the U.S. and one site in the U.K. In
addition, in Q1 of Fiscal 2007, we initiated a Phase I clinical
study for AMD070 called XIST, which is a drug interaction study in
healthy volunteers. We plan to submit additional efficacy and
safety data on the initial cohorts on XACT for presentation at the
Conference on Retroviruses and Opportunistic Infections scheduled
to be held in Los Angeles, California from February 25 to 28, 2007.
Other Updates Executive searches for a new President and Chief
Executive Officer and a Vice President of Regulatory Affairs are
currently ongoing. A U.S. based recruiter has been retained to
recruit for these positions and the Board and management hope to
have candidates in place during this fiscal year. On February 2,
2006, we announced the adoption of our Shareholder Rights Plan
effective February 2, 2006 and expiring on February 2, 2016. The
Rights Plan is required to be confirmed at a meeting of our
shareholders to be held no later than July 31, 2006 or it will
expire. Our newly elected Board has decided not to put the rights
plan to a vote of shareholders; accordingly, it will lapse on July
31, 2006. Financial Strategy As of June 30, 2006, the Company had
cash resources of approximately $47 million. A variety of
alternatives to access additional capital are currently being
investigated. Discussions are ongoing surrounding the monetization
of non-core assets, partnering of non-MOZOBIL assets and partnering
of MOZOBIL outside of the U.S. and the E.U. Further funding to
improve financial longevity and increase flexibility in future
spending may also include raising additional equity capital. In the
event that sufficient capital is unavailable from these sources on
a timely basis, the Company could take steps to reduce its burn
rate by reducing or deferring spending on non-MOZOBIL programs or
delaying the expansion of additional MOZOBIL studies prior to
top-line data becoming available. Financial Results for the First
Quarter Ended June 30, 2006 The Company reported a net loss of
$18,112,000 (or $0.44 per common share) for the fiscal quarter
ended June 30, 2006 as compared to a net loss of $12,784,000 (or
$0.32 per common share) in the immediately prior quarter, the
fourth quarter of Fiscal 2006 and a net loss of $8,025,000 (or
$0.25 per common share) for the same quarter in the previous fiscal
year, Fiscal 2006. The increased loss was due in part to the
increased contract expenditures and additional personnel costs
related to the Phase III trials for MOZOBIL of approximately
$500,000 over the prior quarter. The remainder of the variance was
the result of recognizing a significant portion of the costs
associated with the Special Meeting of Shareholders held during the
quarter. "The first fiscal quarter included the majority of the
expenses of the Special Meeting of Shareholders. These expenses,
totalling $6.1 million, of which $4.8 million was expensed this
quarter, were as expected from our guidance last quarter. In
addition, non-cash stock based compensation expense for the quarter
included an additional $496,000 related to accelerated vesting of
options due to the change in control at the meeting. We do not
expect these to be recurring costs," said Bill Adams, AnorMED's
Chief Financial Officer. "Now that this meeting is behind us, going
forward we can focus on our strategic objectives and we will
continue to evaluate options for strengthening our balance sheet
where appropriate." As at June 30, 2006, the Company had total cash
resources of approximately $47 million. Capital expenditures for
the quarter totalled approximately $614,000 relating mainly to the
recently completed facility expansion to accommodate the growth in
our staff. We expect to receive additional milestone payments of
U.S. $6 million from Shire in Fiscal 2007 based on the receipt of
additional approvals of FOSRENOL(TM) in the E.U. Included in
general and administrative expenses for the first fiscal quarter
are approximately $2.0 million in legal and associated costs
resulting from the Special Meeting of Shareholders held on April
21, 2006. A further amount of $1.3 million was charged to expense
last quarter, the fourth fiscal quarter of 2006, related to the
meeting. Also, a charge of $2.8 million was recorded in the first
fiscal quarter of 2007 relating to severance payments and potential
retention payments to senior management as a result of change of
control provisions in severance agreements. Finally, stock-based
compensation expense for the quarter included an additional
$496,000 related to accelerated vesting of options due to the
change in control and termination of employees during the quarter.
An additional $1.3 million in potential retention payments and
$392,000 in non-cash stock based compensation expense as a result
of the change in control are expected to be expensed over the next
two quarters. AnorMED Inc. - Financial Highlights First Quarter
Report - 2007 CONSOLIDATED BALANCE SHEETS (In thousands of Canadian
dollars, As at As at except share numbers) June 30 March 31
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2006 2006
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(unaudited) (audited) ASSETS Current assets Cash and cash
equivalents $ 41,369 $ 56,758 Short-term investments 6,197 5,492
Accounts receivable 400 504 Prepaid expenses 1,114 1,353 Current
portion of security deposit 100 100 ------------ ------------
49,180 64,207 Long-term investment 264 282 Property and equipment,
net 4,073 3,679 ------------ ------------ $ 53,517 $ 68,168
------------ ------------ ------------ ------------ LIABILITIES AND
SHAREHOLDERS' EQUITY Current liabilities Accounts payable and
accrued liabilities $ 9,994 $ 9,034 Long-term severance liabilities
842 - ------------ ------------ 10,836 9,034 Shareholders' equity
Share capital Issued and outstanding: Common shares - 41,606,455
188,857 187,683 (March 31, 2006 - 41,229,405) Additional paid-in
capital 3,394 2,891 Accumulated deficit (149,552) (131,440)
Accumulated other comprehensive loss (18) - ------------
------------ 42,681 59,134 ------------ ------------ $ 53,517 $
68,168 ------------ ------------ ------------ ------------
CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands of Canadian
dollars, For the three months ended except per share amounts) June
30
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2006 2005
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(unaudited) (audited) Revenue Licensing $ 4 $ 25 Expenses Research
and development 10,468 6,813 General and administrative 7,968 1,733
Amortization 218 208 ------------ ------------ 18,654 8,754
------------ ------------ Other income (expense) Interest and other
income 582 414 Foreign exchange gain (loss) (44) 290 ------------
------------ 538 704 ------------ ------------ Net loss $ (18,112)
$ (8,025) ------------ ------------ ------------ ------------ Loss
per common share $ (0.44) $ (0.25) Diluted loss per common share $
(0.44) $ (0.25) CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS'
EQUITY (In thousands of Canadian dollars, Common Shares except
share numbers) ----------------------- Accumulated (unaudited)
Number Amount deficit
-------------------------------------------------------------------------
Balance at March 31, 2006 41,229,405 $ 187,683 $ (131,440) Issued
for cash 3,750 23 - Issued on exercise of options 373,300 1,151 -
Stock-based compensation - - - Unrealized loss on
available-for-sale securities - - - Net loss - - (18,112)
Comprehensive loss for the period - - -
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Balance at June 30, 2006 41,606,455 $ 188,857 $ (149,552)
-----------------------------------------
----------------------------------------- Common Shares
----------------------- Accumulated Number Amount deficit
-------------------------------------------------------------------------
Balance at March 31, 2005 31,829,493 $ 153,786 $ (89,973) Issued
for cash 14,800 51 - Issued on exercise of options 1,399 7 -
Stock-based compensation - - - Net loss - - (8,025)
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Balance at June 30, 2005 31,845,692 $ 153,844 $ (97,998)
-----------------------------------------
----------------------------------------- CONSOLIDATED STATEMENTS
OF CHANGES IN SHAREHOLDERS' EQUITY Accu- mulated (In thousands of
Addit- other Total Canadian dollars, ional compre- Compre- share-
except share numbers) paid-in hensive hensive holders' (unaudited)
capital loss loss equity
-------------------------------------------------------------------------
Balance at March 31, 2006 $ 2,891 $ - $ - $ 59,134 Issued for cash
- - - 23 Issued on exercise of options (132) - - 1,019 Stock-based
compensation 635 - - 635 Unrealized loss on available-for-sale
securities - (18) (18) (18) Net loss - - (18,112) (18,112)
---------- Comprehensive loss for the period - - $(18,130) -
----------
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Balance at June 30, 2006 $ 3,394 $ (18) - $ 42,681
-------------------------------------------
------------------------------------------- Accu- mulated Addit-
other Total ional compre- Compre- share- paid-in hensive hensive
holders' capital loss loss equity
-------------------------------------------------------------------------
Balance at March 31, 2005 $ 1,698 $ - $ - $ 65,511 Issued for cash
- - - 51 Issued on exercise of options (3) - - 4 Stock-based
compensation 333 - - 333 Net loss - - - (8,025)
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Balance at June 30, 2005 $ 2,028 $ - - $ 57,874
-------------------------------------------
------------------------------------------- CONSOLIDATED STATEMENTS
OF CASH FLOWS For the three months ended (In thousands of Canadian
dollars) June 30
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2006 2005
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(unaudited) (audited) Cash provided by (used in): Operations: Net
loss $ (18,112) $ (8,025) Items not involving cash Amortization 218
208 Loss on disposal of property and equipment 2 11 Unrealized
foreign exchange gain on long-term investment - (4) Compensatory
stock options 635 333 Adjustment to reconcile net income to net
cash provided by operating activities Accounts receivable 104 171
Prepaid expenses 239 80 Accounts payable and accrued liabilities
960 (359) Long-term severance liabilities 842 - ------------
------------ (15,112) (7,585) ------------ ------------
Investments: Net purchase of short-term investments (705) (8,130)
Proceeds on disposal of property and equipment - 16 Purchase of
property and equipment (614) (236) ------------ ------------
(1,319) (8,350) ------------ ------------ Financing: Issuance of
shares, net of share issue costs 1,042 55 ------------ ------------
Decrease in cash and cash equivalents (15,389) (15,880) Cash and
cash equivalents, beginning of the period 56,758 57,834
------------ ------------ Cash and cash equivalents, end of the
period $ 41,369 $ 41,954 ------------ ------------ ------------
------------ About MOZOBIL MOZOBIL is a stem cell mobilizer used in
stem cell transplants, a procedure used to restore the immune
system of cancer patients who have had treatments that previously
destroyed their immune cells. MOZOBIL works by triggering the rapid
movement of stem cells out of the bone marrow and into circulating
blood. Once in the circulating blood, the stem cells can be
collected for use in a stem cell transplant. In Phase II studies,
MOZOBIL consistently demonstrated the ability to help cancer
patients collect more of their own stem cells, resulting in an
increase in the potential for these patients to be able to undergo
a stem cell transplant. MOZOBIL is currently the subject of two
Phase III clinical studies at 45 major centres in the U.S., Canada
and the E.U. involving 600 cancer patients with either
non-Hodgkin's lymphoma or multiple myeloma and who are undergoing
autologous stem cell transplantation as a part of their treatment.
Both Phase III studies are randomized, double-blind,
placebo-controlled, comparative trials of MOZOBIL plus G-CSF versus
placebo plus G-CSF, the current standard drug used to stimulate
additional stem cells within bone marrow. The Company has completed
enrollment in the MM Phase III trial and expects to complete
enrollment in the NHL Phase III trial by the end of 2006 and
announce top-line results from both studies by the second calendar
quarter of 2007. If successful, the results of these clinical
studies would be the basis for filings in the United States,
Canada, the E.U. and other countries seeking approval to market
MOZOBIL for these indications. About AnorMED Inc. AnorMED is a
chemistry-based biopharmaceutical company focused on the discovery,
development and commercialization of new therapeutic products in
the areas of hematology, oncology and HIV, based on the Company's
research into chemokine receptors. AnorMED's corporate strategy is
designed to transform the Company from a research focus into a
successful, fully-integrated biopharmaceutical company built around
the timely development and commercialization of MOZOBIL in order to
maximize shareholder value in both the near-term and long-term. The
Company's product pipeline includes MOZOBIL, currently in Phase III
studies in cancer patients undergoing stem cell transplants;
AMD070, currently in proof-of-principle Phase I/II studies in HIV
patients; and several novel classes of compounds in preclinical
development that target specific chemokine receptors known to be
involved in a variety of diseases. Additional information on
AnorMED Inc. is available on the Company's website
http://www.anormed.com/. This press release contains
forward-looking statements within the meaning of the Private
Securities Litigation Act of 1995 or forward-looking information
within the meaning of applicable securities laws in Canada.
Forward-looking statements or information include, but are not
limited to, statements about: our expectations with respect to
enrollment for, completion of, and reporting on our various
clinical trials; our expectations for the timing and grant of
regulatory approvals; our plans to commence building commercial
infrastructure for MOZOBIL; our intentions relating to the future
of the CCR5 research program; our plans for an E.U. development
organization; our expectations with respect to increasing our
workforce and completing executive searches; favorable top-line
data results, plans relating to additional clinical trials; plans
related to additional applications of MOZOBIL; and, the
availability of further financing and our plans in the event
sufficient capital is not available from alternative sources of
funding. The words "anticipates", "believes", "budgets", "could",
"estimates", "expects", "forecasts", "intends", "may", "might",
"plans", "projects", "schedule", "should", "will", "would" and
similar expressions are intended to identify forward-looking
statements or information, although not all forward-looking
statements or information contain these identifying words. Readers
are cautioned that the plans, intentions or expectations disclosed
in any forward-looking statements or information may not be
achieved and that they should not place undue reliance on any
forward-looking statements or information. Actual results or events
could differ materially from the plans, intentions and expectations
expressed or implied in any forward-looking statements or
information as a result of numerous risks, uncertainties and other
factors, including those relating to: our early stage of
development, particularly the inherent risks and uncertainties
associated with (i) developing new drug candidates generally, and
specifically, drug candidates that interact with chemokine
receptors, (ii) demonstrating the safety and efficacy of these drug
candidates in clinical studies in humans, and (iii) obtaining
regulatory approval to commercialize these drug candidates; our
drug candidates require time-consuming and costly preclinical and
clinical testing and regulatory approvals prior to
commercialization; clinical studies and regulatory approvals of our
drug candidates are subject to delays, and may not be completed or
granted on expected timetables, if at all, and such delays may
increase our costs; our ability to raise substantial additional
financing required to fund further research and development,
conduct planned preclinical and clinical studies, and obtain
regulatory approvals; development or commercialization of similar
products by our competitors, many of which are more established and
have greater financial resources than we do; our limited
manufacturing, sales, marketing and distribution experience; our
ability to obtain raw materials and manufacture products in
commercial quantities at acceptable costs; and, our ability to
successfully attract and retain skilled and experienced personnel.
Other risks, uncertainties and factors that our management believes
could cause actual results or events to differ materially from the
forward-looking statements or information are discussed in our
filings with the Securities and Exchange Commission and the
securities regulatory authorities in Canada. Although we have
attempted to identify important risks, uncertainties and other
factors that could cause actual results or events to differ
materially from those expressed or implied in the forward-looking
statements or information, there may be other factors that cause
actual results or events to differ from those expressed or implied
in the forward-looking statements or information. We undertake no
obligation to revise or update any forward-looking statements or
information as a result of new information, future events or
otherwise after the date hereof, except as may be required by law.
Teleconference Call Notification: July 27, 2006 4:30 pm/EDT (1:30
pm/PDT)
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On Thursday, July 27, 2006, AnorMED Inc. will host a teleconference
call at 4:30 pm/EDT (1:30 pm/PDT). To participate in the
teleconference please dial, 1-800-733-8619 in Canada and the U.S.
or 1-212-231-6036 Internationally before 4:30 pm/EDT. This call
will be taped, available one hour after the teleconference, and on
replay until Aug 26, 2006. To hear a complete replay, please call
1-800-558-5253. The reservation number required for access is
21299653. This call will also be webcast from AnorMED's website at
http://www.anormed.com/. CONTACT: Company Contact: W.J. (Bill)
Adams, Chief Financial Officer, Tel: (604) 530-1057, or Kim Nelson,
Manager, Investor Relations, Tel: (604) 532-4654, ; Media Contact:
Karen Cook-Boas, (604) 739-7500, DATASOURCE: AnorMED Inc. CONTACT:
Company Contact: W.J. (Bill) Adams, Chief Financial Officer, Tel:
(604) 530-1057, or Kim Nelson, Manager, Investor Relations, Tel:
(604) 532-4654, ; Media Contact: Karen Cook-Boas, (604) 739-7500,
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