RNS No 0158w
THERAPEUTIC ANTIBODIES INCORPORATED
31 March 1999
THERAPEUTIC ANTIBODIES ANNOUNCES
1998 YEAR END RESULTS
London, 31 March 1999 - Therapeutic Antibodies Inc announces
1998 sales, contract and licensing revenue more than doubled to
$3.27 million as a result of milestone payments, including $1.5
million from Altana Inc., and sales of our ViperaTAb and EchiTAb
antivenom products.
Investment in research and development for 1998 was relatively
unchanged at $11.36 million as the Company concentrated its
development efforts on products which will contribute toward
achieving near-term profitability.
During the year, the addition of key individuals at management
and board level brought significant sales, marketing and
operations expertise into the Company. There were further
advances in the development of several products following
renewed efforts to focus on the most commercially viable. The
Company continues to investigate new opportunities for
collaboration and strategic partnerships.
The results for the year ended 31 December 1998 will be included
in the Company's annual report on Form 10-K to be filed with the
Securities and Exchange Commission in the United States. Copies
of the Form 10-K may be obtained from the Company's London and
Nashville offices.
In November 1998, Therapeutic Antibodies successfully completed
a placing of Common Stock raising net cash proceeds of #7.5
million ($12.6 million). At the time of the placing, the Company
estimated that the fundraising would provide sufficient funds to
allow it to reach the launch of several of its products and
accordingly bring the Company to the point at which its revenues
could sustain ongoing product development. The subsequent
termination of the Searle contract will, however, result in a
requirement for additional financing in mid-1999 to fund
operations.
The Company is currently pursuing several corporate and
financing strategies including preliminary discussions which may
lead to a merger on a share exchange basis at a value which
approximates to the current market value of Therapeutic
Antibodies. The Board has also entered into discussions with
third parties relating to the sale of additional debt or equity
securities, the disposal of certain non-core investments,
entering into additional product licensing arrangements and
other combinations or collaborations with strategic partners.
Therapeutic Antibodies is actively investigating strategies for
the most cost-effective method of transferring the Company's
domicile to the UK.
1998 HIGHLIGHTS:
- Board restructuring and appointment of new Chairman, Chief
Executive and Director of Global Operations
- CroTAb Product License Application (PLA) and Establishment
License Application (ELA) submitted and accepted for filing by
Food and Drug Administration (FDA)
- Receipt of $1.5 million milestone payment from Altana Inc.
tied to FDA acceptance of CroTAb license applications
- Two CytoTAb Investigational New Drug (IND) applications
submitted to FDA
- TriTAb Phase I/II clinical trials in adults and pediatrics
started
- Successful completion of #11.5 million (US$19.5 million)
refinancing
- Sales and contract revenue rose 85% to $726,960; licensing
revenue rose 129% to $2.53 million
- Investment in R&D relatively unchanged at $11.36 million
Commenting on the results, Chief Executive Andrew Heath said:
'The year has been one of change and hard work and the benefits
are already apparent. With FDA approval and the commercial
launch of CroTAb expected by the third quarter of 1999, a
Product License Application for DigiTAb planned for mid-year and
clinical trials now underway for both TriTAb and CytoTAb, the
current year promises to build on our progress. These
developmental milestones demonstrate the soundness of our
technology and our commitment to developing those products with
near-term commercial potential.
'We are currently investigating opportunities to improve our
financial position and the experience of our management and the
strength of our technology give me confidence that Therapeutic
Antibodies has a promising future ahead.'
FOR FURTHER INFORMATION, PLEASE CONTACT:
Stuart Wallis, Chairman, Therapeutic Antibodies Inc
tel: 0171 553 1483
Andrew Heath, Chief Executive Officer, Therapeutic Antibodies
Inc
tel: 001 615 327 1027
Laura Frost, The Maitland Consultancy
tel: 0171 379 5151
CHIEF EXECUTIVE'S STATEMENT
We are pleased with our progress over the year. A significant
increase in revenue from sales, contracts and licensing was
largely due to a $1.5 million milestone payment in the third
quarter from Altana, related to progress made in the development
of CroTAb. A Product License Application (PLA) and Establishment
License Application (ELA) for CroTAb were submitted and accepted
for filing by the Food and Drug Administration in the first
half.
There were several product developments during the fourth
quarter. An IND was submitted and cleared by the FDA for the use
of CytoTAb in Crohn's disease. In addition, following the
initiation of the TriTAb adult study earlier in the year, the
first patient in the TriTAb pediatric study was enrolled in
December. These studies were commenced under Investigator INDs
and signify the first administration of this product in humans.
The completion in November of the #11.5 million (US$19.5
million) refinancing showed an encouraging level of interest
from institutional investors given the difficult market
conditions at that time.
Following my appointment as chief executive in March and the
appointment of Stuart Wallis as chairman in September, the board
appointed James Christie as Director of Global Operations during
the fourth quarter, further strengthening the Company's
management capability. Together these individuals bring to
Therapeutic Antibodies the level of marketing skills, management
experience and product knowledge needed to take the Company
forward.
REVIEW OF OPERATIONS
CroTAb - A new antivenom product designed to neutralise the
effects of bites from most poisonous snakes native to North
America.
In 1998, Therapeutic Antibodies received a $1.5 million
milestone payment from Altana Inc., upon acceptance of the
CroTAb Product License Application (PLA) and Establishment
License Application (ELA) for review by the FDA.
The Company's production facility in Wales was inspected by the
FDA in the first quarter of 1999 and we anticipate approval and
product launch by the third quarter of this year.
CroTAb, DigiTAb and TriTAb make up the Emergency Medicine
Product line. Under the terms of an agreement with Altana Inc.,
Therapeutic Antibodies will receive up to US$23 million for the
U.S. distribution rights to its Emergency Medicine products.
DigiTAb - A product designed to combat the effects of digoxin
toxicity.
During the year, the Company completed an interim analysis which
we believe is adequate to support a Product License Application
(PLA). The Company plans to submit its PLA for DigiTAb to the
FDA on schedule by mid 1999.
TriTAb - A polyclonal antibody product tailored to offset the
toxic effects of overdoses of tricyclic antidepressants.
During that year, Phase I studies in both adults and pediatrics
were initiated under FDA cleared Investigator INDs and the first
patients were enrolled in the studies. Data from these studies,
which mark the first administration of this product in humans,
is expected to be available in the second quarter of 1999.
We are currently planning the Phase II/III study in overdose
patients to commence this year.
CytoTAb - A polyclonal antibody product, which has been shown to
be safe and effective in neutralising circulating TNF (tumor
necrosis factor). Following a review of CytoTAb, the Company is
now concentrating on the following indications:
- Crohn's Disease & Coronary Artery Bypass Graft
The Company is commencing new pilot studies to determine the
feasibility of using CytoTAb in patients with Crohn's disease
and those patients undergoing the coronary artery bypass graft
(CABG) procedure. Initial trials in these indications will
require relatively few patients and can be conducted rapidly.
In October, INDs for these indications were submitted to the
FDA.
The Crohn's IND was accepted in December by the FDA and we are
currently enrolling patients in the Phase I/II study.
- Cerebral Malaria
The malaria program is being pursued in collaboration with F.H.
Faulding & Co. Limited. Enrolment of 100 patients in the Phase
II study in Bangkok, Thailand was completed by the end of the
year, several months earlier than expected.
Results from this study are expected by mid 1999.
- Graft vs. Host Disease
The evaluation of CytoTAb in patients at risk of graft vs. host
disease as a result of bone marrow transplants was put on hold
in the fourth quarter. Further development will be dependent
upon other CytoTAb programs which may have a greater commercial
potential in the short term.
Searle Agreement - A research agreement signed in 1998 with G.D.
Searle & Co. for the development of an antibody for two of its
products was terminated earlier this year following Searle's
decision to cease development of those products. Nonetheless, in
addition to being an important endorsement of our platform
technology, the alliance demonstrated Therapeutic Antibodies'
ability to work effectively with a major pharmaceutical company.
Other Products - ViperaTAb, an antivenom for poisonous European
snakes, is commercially available in Scandinavia. EchiTAb, an
antivenom for poisonous snakes native to western Africa, is
commercially available in Nigeria.
The Company's production facility in Wales was inspected by the
British Medicines Control Agency (MCA) during the first quarter
of 1999. This is one step in the approval process which will
enable us to extend sales of ViperaTAb in Europe on a named
patient basis.
BACKGROUND ON THERAPEUTIC ANTIBODIES INC
Therapeutic Antibodies is an international biopharmaceutical
company specialising in research, development and production of
highly-purified polyclonal antibodies for treatment of diseases
and other life-threatening conditions for which satisfactory
therapies have generally not previously existed.
The Company is headquartered in Nashville, Tennessee, adjacent
to the Vanderbilt University Medical Center. The Company's
research laboratories are located at the Medical College of St.
Bartholomew's Hospital in London. Therapeutic Antibodies Inc's
products are manufactured at the Company's production facilities
in Australia and the UK for worldwide distribution. The
Company's Common Stock is listed on the London Stock Exchange.
An electronic version of this news release, as well as
additional information about Therapeutic Antibodies Inc, is
available at http://www.tab.co.uk on the Company's home page.
This release, and oral statements made from time to time by
Company representatives concerning the subject matter hereof,
may contain so-called 'forward looking statements'. These
statements can be identified by introductory words such as
'expects', 'plans', 'will', 'estimates', 'forecasts',
'projects', or words of similar meaning, and by the fact that
they do not relate strictly to historical or current facts.
Forward-looking statements frequently are used in discussing the
Company's growth strategy, operating and financial goals, plans
relating to regulatory submissions and approvals and development
programs. Many factors may cause actual results to differ from
the Company's forward-looking statements, including inaccurate
assumptions and a broad variety of risks and uncertainties, some
of which are known and others of which are not. No forward-
looking statement is a guarantee of future results or events,
and one should avoid placing undue reliance on such statements.
THERAPEUTIC ANTIBODIES INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED BALANCE SHEETS
DEC 31 1998 DEC 31 1997
----------- -----------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $7,760,328 $4,915,077
Restricted cash 419,168 -
Short-term investments - 1,997,240
Trade receivables 67,677 594,267
Value added tax receivable 326,849 179,629
Inventories 287,802 489,138
Other current assets 712,370 409,929
---------- ----------
Total current assets 9,574,194 8,585,280
Property and equipment, net 11,074,766 11,456,690
Patent and trademark costs, net 678,306 598,924
Other assets, net 94,236 159,171
---------- ----------
Total assets
$21,421,502 $20,800,065
========== ==========
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued $1,755,098 $1,457,121
expenses
Accrued interest 122,486 146,326
Current portion of notes payable 2,159,428 2,545,701
---------- ----------
Total current liabilities 4,037,012 4,149,148
Notes payable, net of current 4,744,216 6,059,072
portion
Deferred revenue 342,363 559,467
Other liabilities 275,477 274,033
---------- ----------
Total liabilities 9,399,068 11,041,720
========== ==========
Convertible redeemable preferred - -
stock - par value $.01 per share;
1,000,000 shares authorised
STOCKHOLDERS' EQUITY:
Common stock - par value $.001 per
share; 59,000,000 shares
authorised, 52,057,219
issued and outstanding December
31, 1998; 30,000,000 shares
authorised, 23,252,825
issued and outstanding December 52,057 23,253
31, 1997
Additional paid-in capital 87,074,215 68,927,203
Deficit accumulated during the (75,301,311) (59,412,383)
development stage (1984-1998)
Other comprehensive income 197,473 220,272
------------ ------------
Total stockholders' equity 12,022,434 9,758,345
------------ ------------
Total liabilities and $21,421,502 $20,800,065
stockholders' equity
============ ============
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
For the Years Ended December 31
--------------------------------
1998 1997 1996
---------- ---------- ----------
$ $ $
REVENUES:
Sales and 726,960 392,888 600,607
contract revenue
Licensing revenue 2,543,925 1,112,955 143,500
Interest Income 239,362 886,511 607,479
Grant Income 41,488 205,569 118,535
Foreign currency - - 1,733,357
gains
Value-added tax - - -
and insurance
recoveries
Other 80,074 80,008 64,890
---------- ---------- ----------
3,631,809 2,677,931 3,268,368
---------- ---------- ----------
EXPENSES:
Cost of sales and 440,759 110,740 334,989
contract revenue
Research and 11,363,218 11,462,352 9,185,126
development
General and 4,050,667 3,561,541 2,721,889
administrative
Marketing and 547,406 614,598 361,262
distribution
Depreciation and 1,561,951 1,643,922 1,387,916
amortisation
Interest 1,305,549 1,001,959 1,201,335
Foreign currency 240,703 913,119 -
losses
Debt conversion - - 801,597
expense
Other 10,485 217,418 20,371
---------- ---------- ----------
19,520,737 19,525,649 16,014,485
---------- ---------- ----------
Net loss (15,888,928) (16,847,718) (12,746,117)
Preferred stock (32,877) - -
dividends
---------- ---------- ----------
Net loss (15,921,805) (16,847,718) (12,746,117)
applicable to
common
shareholders
Other (22,799) (455,521) 859,202
comprehensive
income (loss),
before and after
tax:
Change in equity
due to foreign
currency
translation
adjustments
---------- ---------- ----------
Total (15,944,604) (17,303,239) (11,886,915)
comprehensive
loss
========== ========== ==========
Basic and diluted (0.59) (0.74) (0.68)
net loss per
share
========== ========== ==========
Weighted average 26,910,291 22,888,226 18,821,524
shares used in
computing basic
and diluted net
loss per share
========== ========== ==========
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
For the Cumulative
Development Stage
from August 10,
1984
(inception)through
to December 31,
1998
------------------
$
REVENUES:
Sales and contract revenue 3,518,077
Licensing revenue 3,900,380
Interest Income 2,162,048
Grant Income 774,007
Foreign currency gains 1,785,984
Value-added tax and insurance 577,170
recoveries
Other 300,888
----------
13,018,554
----------
EXPENSES:
Cost of sales and contract revenue 985,916
Research and development 53,405,675
General and administrative 16,993,834
Marketing and distribution 2,523,959
Depreciation and amortisation 7,073,621
Interest 5,036,131
Foreign currency losses 1,153,822
Debt conversion expense 801,597
Other 345,310
----------
88,319,865
----------
Net loss (75,301,311)
Preferred stock dividends (32,877)
----------
Net loss applicable to common (75,334,188)
shareholders
Other comprehensive income (loss), 197,473
before and after tax:
Change in equity due to foreign
currency translation adjustments
----------
Total comprehensive loss (75,136,715)
==========
Basic and diluted net loss per share (6.78)
==========
Weighted average shares used in 11,114,957
computing basic and diluted net loss
per share
==========
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Years Ended December 31
-------------------------------
1998 1997 1996
$ $ $
CASH FLOW FROM
OPERATING
ACTIVITIES:
Net loss (15,888,928) (16,847,718) (12,746,117)
Adjustments to
reconcile net loss
to net cash used
in operating
activities:
Depreciation and 1,561,951 1,643,922 1,387,916
amortisation
Disposal of 279,328 282,806 532,817
property and
equipment
Foreign currency 240,703 913,119 (1,733,357)
loss (gain)
Warrant expense 292,919 - 46,944
Stock-based 160,129 487,968 62,431
compensation
expense
Debt conversion - - 801,597
expense
Changes in:
Restricted cash (419,168) - -
Trade receivable 355,227 (434,140) (52,373)
Inventories 201,335 (88,971) (7,073)
Other current (301,155) 60,616 (128,813)
assets
Accounts payable 333,821 646,550 (340,411)
and accrued
expenses
Accrued interest 86,749 (777) (37,512)
Deferred revenue (218,581) (84,063) 313,670
Other 32,877 - (234,301)
------------ ------------ ------------
Net cash used in (13,282,793) (13,420,688) (12,134,582)
operating
activities
------------ ------------ ------------
CASH FLOWS FROM
INVESTING
ACTIVITIES:
Purchase of (1,385,027) (1,257,448) (3,293,214)
property and
equipment
Patent and (99,657) (109,709) (198,502)
trademark costs,
net
Purchase of short- - (11,931,028) (2,002,266)
term investments
Maturity of short- 2,094,509 11,838,785 -
term investments
Other - - -
------------ ------------ ------------
Net cash provided 609,825 (1,459,400) (5,493,982)
by (used in)
investing
activities
------------ ------------ ------------
CASH FLOWS FROM
FINANCING
ACTIVITIES:
Proceeds from 4,641,239 17,605 2,518,239
notes payable
Payments on notes (3,346,423) (1,299,211) (1,969,138)
payable
Proceeds from line - 61,897 123,371
of credit
Payments on line (43,836) (118,505) (1,018,738)
of credit
Proceeds from - - 5,432,500
convertible debt,
net
Payments on - - (4,320,325)
convertible debt
Proceeds from 14,707,529 1,358,086 32,326,264
issuance of stock
net
Proceeds from - - -
issuance of
warrants
Other (1,869) 39,184 (5,628)
------------ ------------ ------------
Net cash provided 15,956,640 59,056 33,086,545
by financing
activities
------------ ------------ ------------
Effect of exchange (438,421) (766,427) 1,647,473
rate changes on
cash and cash
equivalents
------------ ------------ ------------
Net (decrease) 2,845,251 (15,587,459) 17,105,454
increase in cash
and cash
equivalents
Cash and cash 4,915,077 20,502,536 3,397,082
equivalents,
beginning of
period
------------ ------------ ------------
Cash and cash 7,760,328 4,915,077 20,502,536
equivalents, end
of period
============ ============ ============
SUPPLEMENTAL CASH
FLOW DISCLOSURES:
Cash payments for 929,106 1,017,000 1,142,738
interest (net of
amount
capitalised)
============ ============ ============
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Cumulative
Development Stage
From August 10, 1984
(Inception) Through
December 31, 1998
---------------------
$
CASH FLOW FROM OPERATING ACTIVITIES:
Net loss (75,301,311)
Adjustments to reconcile net loss to
net cash used in operating
activities:
Depreciation and amortisation 7,073,621
Disposal of property and equipment 1,206,566
Foreign currency loss (gain) (632,162)
Warrant expense 486,913
Stock-based compensation expense 710,528
Debt conversion expense 801,597
Changes in:
Restricted cash (419,168)
Trade receivable (154,005)
Inventories (173,629)
Other current assets (709,262)
Accounts payable and accrued 1,887,203
expenses
Accrued interest 862,974
Deferred revenue 11,026
Other (10,612)
------------
Net cash used in operating (64,359,721)
activities
------------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Purchase of property and equipment (15,273,350)
Patent and trademark costs, net (760,654)
Purchase of short-term investments (13,933,294)
Maturity of short-term investments 13,933,294
Other 69,750
------------
Net cash provided by (used in) (15,964,254)
investing activities
------------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Proceeds from notes payable 20,450,244
Payments on notes payable (9,523,894)
Proceeds from line of credit 3,371,278
Payments on line of credit (3,371,278)
Proceeds from convertible debt, net 9,655,000
Payments on convertible debt (4,320,325)
Proceeds from issuance of stock, net 71,719,109
Proceeds from issuance of warrants 65,000
Other (149,467)
------------
Net cash provided by financing 87,895,667
activities
------------
Effect of exchange rate changes on 188,636
cash and cash equivalents
------------
Net (decrease) increase in cash and 7,760,328
cash equivalents
Cash and cash equivalents, beginning -
of period
------------
Cash and cash equivalents, end of 7,760,328
period
============
SUPPLEMENTAL CASH FLOW DISCLOSURES:
Cash payments for interest (net of 1,612,778
amount capitalised)
============
END
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