Press Releases
FLAMEL TECHNOLOGIES S.A. REPORTS THIRD QUARTER 1997 RESULTS
LYON, FRANCE, October 28, 1997 -- Flamel Technologies S.A. (NASDAQ: FLML) today announced financial results for the third quarter ended September 30, 1997.
For the quarter ended September 30, 1997, the Company had a net loss of $2.9 million, or $0.27 per share, on revenues of $1.2 million, compared with a loss of $1.4 million, or $0.14 per share, on revenues of $0.7 million in the comparable quarter of 1996. Flamel said that third quarter 1997 revenues included $0.9 million in revenues from sales of Cimetidine formulations to SmithKline Beecham Laboratoires Pharmaceutiques in accordance with the subcontracting agreement signed as part of the purchase by the Company of SmithKline’s Pessac manufacturing plant effective January 1, 1997.
In the first nine months of 1997, Flamel had a net loss of $6.9 million, or $0.66 per share, on revenues of $4.7 million, compared to a net loss of $5.3 million, or $0.66 per share, on revenues of $3.7 million in the comparable nine months in 1996. The Company noted that its nine-month 1997 revenue figure included $2.8 million from sales of Cimetidine formulations to SmithKline, while the revenues for 1996 included a non(recurring licensing fee payment of $1.5 million received from G.D. Searle & Co. in the first quarter of 1996.
Commented Dr. Gérard Soula, president and chief executive officer of Flamel Technologies S.A.: "During the third quarter of 1997, Flamel continued to make progress in its development of advanced polymer technologies for unique drug delivery and biomaterial applications. Most notably, we concentrated on our Phase III clinical trial of Viropump, Flamel’s twice-daily, controlled-release aciclovir for the treatment of acute genital herpes. Our R&D effort also concentrated on our Medusaâ protein and peptide delivery system, specifically the preclinical development of our BasulinTM long-acting parenteral insulin formulation for the treatment of diabetes.
"In addition, in late October, the Company announced initial clinical results on its Asacard controlled-release cardiovascular aspirin," continued Dr. Soula. "The results indicated that Asacard causes less endoscopic damage than conventional aspirin. We are encouraged to conduct a larger clinical trial, in collaboration with G.D. Searle & Co., to confirm this safety improvement. If confirmed, physicians prescribing aspirin for the prevention of myocardial infarction and stroke may not need to choose between proven efficacy (high doses) and gastric safety (low doses)."
For the quarter ended September 30, 1997, total operational costs were $4.6 million, up from the $2.7 million reported for in the comparable quarter of 1996. Flamel said the increase principally reflects changes in R&D costs and, to a lesser extent, the cost of operating the Pessac manufacturing plant and the manufacture of the Cimetidine products for SmithKline in 1997. R&D costs of $3.1 million, above the $1.7 million for the comparable quarter in 1996, were higher due to the higher level of spending on clinical trials and the increase in the number of R&D staff between the two periods. Sales, General and Administrative costs were $0.7 million for the third quarter of 1997, approximately the same as in the comparable quarter of 1996.
Total operational costs for the nine months ended September 30, 1997 were $12.7 million, up from $9.9 million in the comparable nine months of 1996. This increase reflects principally a substantial increase in R&D costs, an increase in the cost of goods arising from the operation of the Company’s manufacturing facility in Pessac, and a reduction of stock compensation expenses.
On September 30, 1997, the Company had $13.5 million in cash, cash equivalents and short(term investments.
Flamel Technologies is engaged in the development of advanced polymer technologies for unique drug delivery and biomaterial applications. The Company is building on its principal technology platforms — through programs including MicropumpTM and Medusa® in drug-delivery, ColCys in biomaterial-based medical devices, and new materials for ophthalmic lens products -- to meet important unmet medical needs and develop other commercially valuable products. In June 1996, Flamel completed its initial public offering in the U.S.
NOTE: This press release contains statements which constitute forward(looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties, including but not limited to the risk associated with the Company’s limited history of operations and historic and future losses, and the risk that products in the development stage may not achieve scientific objectives of milestones or meet stringent regulatory requirements, uncertainties regarding market acceptance of products in development, the impact of competitive products and pricing, reliance on outside parties and the risk associated with key strategic alliances, and other risks detailed in the Company’s filings with the Securities and Exchange Commission.
FLAMEL TECHNOLOGIES
S.A.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(Amounts in thousands of dollars, except per
share data)
|
Three months ended |
Nine months ended | |||
|
1996 |
1997 |
1996 |
1997 | |
|
Revenue: |
||||
|
License and research revenue |
$ 547 |
$ 251 |
$ 3,127 |
$1,173 |
|
Product sales |
106 |
870 |
427 |
2,826 |
|
Laboratory analysis services |
37 |
122 |
156 |
259 |
|
Other revenues |
2 |
0 |
7 |
445 |
|
Total revenues |
692 |
1,243 |
3,717 |
4,703 |
|
Cost and expenses: |
||||
|
Cost of goods sold |
(268) |
(758) |
(500) |
(2,487) |
|
Cost of laboratory analysis services |
(35) |
(46) |
(100) |
(154) |
|
Research and development |
(1,673) |
(3,075) |
(5,743) |
(7,659) |
|
Selling, general and administrative |
(678) |
(702) |
(1,903) |
(2,218) |
|
Stock compensation expense |
(54) |
(49) |
(1,697) |
(147) |
|
Total cost and expenses |
(2,708) |
(4,630) |
(9,943) |
(12,665) |
|
Loss from operations |
(2,016) |
(3,387) |
(6,226) |
(7,962) |
|
Interest income (expense), net |
290 |
201 |
280 |
426 |
|
Foreign exchange gain (loss) |
- |
- |
76 |
28 |
|
Loss before income taxes |
(1,726) |
(3,186) |
(5,87) |
(7,508) |
|
Income tax benefit |
340 |
250 |
573 |
652 |
|
Net loss |
$(1,386) |
$(2,936) |
$(5,297) |
$(6,856) |
|
Net loss per ordinary share |
$ (0.14) |
$ (0.27) |
$ (0.66) |
$ (0.66) |
|
Weighted average number of ordinary and ordinary equivalent shares outstanding |
9,857 |
10,806 |
7,977 |
10,464 |
