CABG Medical Announces Device and Clinical Trial Modifications and Second Quarter 2005 Results
04 August 2005 - 11:02PM
PR Newswire (US)
MINNEAPOLIS, Aug. 4 /PRNewswire-FirstCall/ -- CABG Medical, Inc.
(NASDAQ:CABG), the developer of an innovative drug-eluting graft
(DEG) for coronary artery bypass surgery, today reported results
for the second quarter of fiscal 2005. Net loss for the second
quarter of 2005 was $1.3 million, or $0.07 per share, compared to a
net loss of $0.7 million, or $0.07 per share, for the second
quarter of 2004. For the six months ended June 2005, the Company
had a net loss of $6.9 million, or $0.39 per share, compared to a
net loss of $1.4 million or $0.14 per share for the first six
months of 2004. The 2005 year-to-date net loss included research
and development expense of $6,387,000 of which $4,363,000 was
related to the Company's March 22, 2005 paclitaxel license
agreement with Angiotech Pharmaceuticals, Inc. (NASDAQ:ANPI). The
license agreement expense included a non-cash charge of $4,335,000
related to the issuance of equity securities to Angiotech. The
Company was required to expense the license agreement equity
consideration due to the development stage of the Company's
operations and its DEG. Excluding these costs, the proforma loss
for the six months ended June 30, 2005 would have been $2.6
million, or $0.14 per share. (Logo:
http://www.newscom.com/cgi-bin/prnh/20050114/CGF013LOGO ) The
Company also announced that the grafts implanted in the first two
Australian patients have become occluded and are no longer
functional. The patients are in good health without symptoms and
the surgical team has indicated their intent to continue with the
human clinical trials once device and clinical trial modifications
are complete. We have analyzed the clinical results to date with
our surgeon collaborators and have identified improvements related
to manufacturing, our procedure and the post operation
anti-coagulation regimen that will be implemented in our ongoing
clinical trials which we estimate will begin in September or
October as our devices become available. First, we have developed a
new proprietary coating process to spray our heparin coating on the
vessel connector. The spray heparin allows for a more uniform and
consistent application of the coating, which has demonstrated
superior in vitro bench testing results and in vivo preclinical
(animal) results. Second, we have reviewed our animal work and feel
that a simple improvement in the surgical procedure is necessary
and will be incorporated into our human cases. Lastly, at the
suggestion of our clinical study surgeons, we have implemented a
change in the anti-coagulation regimen to include chronic
administration of warfarin. The anti-coagulation change was made
based on the review of our first cases, discussions with our
clinical investigators and our scientific advisory board. Warfarin
is a commonly used anti-coagulant in cardiac surgery. Additionally,
the most recent results from the Company's human clinical trial
have been accepted for presentation at the fourth annual Pioneering
Techniques in Cardiac Surgery Congress, in Leipzig, Germany on
December 1 - 2, 2005. In connection with the congress CABG Medical
will be announcing a summary of the human clinical results that
will be presented by Dr. Trevor Fayers, The Prince Charles
Hospital, Brisbane, Australia. Additional information on the
Congress can be obtained at
http://promedicacme.com/conf_leipzig2005.htm . Conference Call
Today CABG Medical management will host a conference call and web
cast today, August 4, 2005 at 4:30 p.m. Eastern Daylight Time (3:30
p.m. Central Daylight Time) to discuss its second quarter financial
results, outlook for the remainder of 2005 and current clinical
developments. The dial in number for the conference call is
1-800-479-9001. A live webcast of the call can be accessed at
http://www.cabgmedical.com/ by clicking on the "Investor Relations"
icon. The webcast will be available on the company's website until
August 31, 2005. About CABG Medical CABG Medical, Inc. is a medical
technology company developing technologies and therapies to improve
the treatment of coronary heart disease by advancing conventional
bypass surgery. We have designed our first product, the Holly
Graft(TM) System, by leveraging our understanding of flow dynamics,
material sciences and drug combinations to create a drug-eluting
graft system. Safe Harbor Certain statements in this release that
are not historical facts, including, without limitation, those
relating to our expectation regarding the commencement of clinical
trials in 2005 in Australia and Europe, our belief in the
paclitaxel franchise as a drug combination capable of preventing
restenosis following the surgical implantation of devices such as
the Holly Graft(TM) System, our clinical and regulatory efforts,
and our anticipation that we will be able to present in 2005 the
first follow-up results from such clinical trials, are
forward-looking statements that involve risks and uncertainties.
Such statements are based upon the current beliefs and expectations
of our management. Actual results may vary materially from those
contained in such forward-looking statements based on a number of
factors including, without limitation, our need to obtain
regulatory approval in each relevant jurisdiction prior to the
initiation of any clinical trials or human cases in such
jurisdiction, the selection of clinical sites, the completion of
such trials and cases, and other factors disclosed from time to
time in our filings with the U.S. Securities and Exchange
Commission. The complete occlusion in the Company's first two graft
implants will result in delays in getting regulatory approvals for
clinical testing in the United States and other countries, and may
impact the Company in other ways not yet capable of assessment. It
will be of critical importance to the Company that the new coating
procedure and drug regimens effectively prevent occlusion in future
graft implants. Investors should take such risks into account when
making investment decisions. Shareholders and other readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date on which they are made.
We undertake no obligation to update any forward-looking
statements. CABG Medical, Inc. Statements of Operations (unaudited)
Three Months Ended June 30, Six Months Ended June 30, 2004 2005
2004 2005 (In thousands, except share and per share data) Revenue
$- $- $- $- Expenses: Research and development 473 1,063 992 6,387
Marketing, general and administrative 236 474 401 1,012 Total 709
1,537 1,393 7,399 Interest income 7 277 12 483 Net loss $(702)
$(1,260) $(1,381) $(6,916) Basic and diluted net loss per share
$(0.07) $(0.07) $(0.14) $(0.39) Weighted average shares outstanding
- basic and diluted 9,846,052 19,082,764 9,601,077 17,942,362 CABG
Medical, Inc. Balance Sheets (unaudited) December 31, June 30, 2004
2005 (In thousands) Assets Current assets: Cash and short term
investments $28,936 $31,393 Other current assets 291 165 Total
current assets 29,227 31,558 Long-term investments - 4,000 Property
and equipment, net 199 314 Total assets $29,426 $35,872 Liabilities
& Stockholders' Equity Current liabilities: Accounts payable
$841 $477 Accrued liabilities 19 29 Total current liabilities 860
506 Total stockholders' equity 28,566 35,366 Total liabilities and
stockholders' equity $29,426 $35,872 CABG Medical, Inc. Statements
of Operations Reconciliation of GAAP Results from Operations to
Proforma Results from Operations (unaudited) Six Months Ended June
30, Proforma Adjustment Proforma 2004 2005 (1) 2005 (In thousands,
except share and per share amounts) Revenue $- $- $- Expenses:
Research and development 992 6,387 (4,363) 2,024 Marketing, general
and administrative 401 1,012 1,012 Total expenses 1,393 7,399
(4,363) 3,036 Interest income 12 483 483 Net loss $(1,381) $(6,916)
(4,363) $(2,553) Basic and diluted net loss per share $(0.14)
$(0.39) $(0.14) Weighted average shares outstanding - basic and
diluted 9,601,077 17,942,362 17,942,362 (1) Proforma adjustment is
provided to illustrate the impact of the issuance of equity
securities to Angiotech in exchange for an exclusive license to
certain drug eluting technologies. The proforma adjustment is
comprised of a $4,335,000 non-cash charge related to the fair value
of the equity securities issued to Angiotech and $28,000 in related
legal expenses.
http://www.newscom.com/cgi-bin/prnh/20050114/CGF013LOGO
http://photoarchive.ap.org/ DATASOURCE: CABG Medical, Inc. CONTACT:
Manny Villafana, Chairman & CEO, or John L. Babitt, President,
COO & CFO, both of CABG Medical, Inc., +1-763-258-8005, or FAX,
+1-763-258-8008 Web site: http://www.cabgmedical.com/
http://promedicacme.com/conf_leipzig2005.htm
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