Company discloses key 2014 corporate
objectives
Compugen Ltd. (NASDAQ: CGEN) today reported financial results
for the fourth quarter and year ended December 31, 2013 and
disclosed key corporate objectives for 2014.
Anat Cohen-Dayag, PhD, President and CEO of Compugen, stated,
“This past year was very important for Compugen with respect to
demonstrating our competitive advantages in predictive drug
discovery. During 2013, among other achievements, we began to
license product candidates from our first focused discovery program
for immune checkpoints, to advance additional immune checkpoint
candidates in our Pipeline Program, and to harness the power of our
predictive infrastructure to initiate a second focused discovery
program of targets for antibody drug conjugate (ADC) cancer
therapy, for which we announced initial target candidate
discoveries before year-end. During the year, we also began to
receive greater recognition within the industry for both our
Pipeline Program candidates and discovery capabilities.”
Dr. Cohen-Dayag continued, “With a significantly increased
R&D budget for 2014, we look forward to further achievements in
our areas of focus, with a primary emphasis on immune checkpoint
related product opportunities. This emphasis includes advancing
multiple candidates towards additional future early stage
collaborations and expanding our internal research and development
activities for future human clinical trials in the field of cancer
immunotherapy.”
With respect to calendar 2014, included in our corporate
objectives are the following:
- achieve work plan goals and milestones
for existing collaborations
- enter into one or more additional
Pipeline Program collaborations
- aggressively advance in parallel
additional target research and therapeutic antibody discovery
programs for multiple immune checkpoints for cancer immunotherapy,
including one or more to be taken towards future clinical trials in
oncology by the company
- establish a biomarker discovery program
for selected checkpoint candidates
- achieve experimental validation for our
recently discovered ADC target candidates
- utilize the Company's predictive
discovery infrastructure to further enhance the intellectual
property position of selected product candidates
Revenues for the fourth quarter of 2013 and the year ended
December 31, 2013 were $1.8 million and $3.5 million, respectively,
compared with $134,000 and $242,000 for the comparable periods in
2012. Revenues reported for the most recent periods consisted
primarily of the portions of the non-refundable $10 million upfront
payment received under the August 2013 collaboration and license
agreement with Bayer Pharma AG (“Bayer Agreement”), that were
recognizable during such periods in accordance with U.S. GAAP
revenue recognition accounting.
Cost of revenues for the fourth quarter of 2013 and year ended
December 31, 2013 were $810,000 and $2.5 million respectively,
compared with $168,000 and $201,000 for the comparable periods in
2012. These increases reflect, in large part, research and
development expenses and certain payments that occurred in the
third quarter of 2013, in both cases attributed to the Bayer
Agreement.
Research and development expenses, net, for the fourth quarter
of 2013 and the year ended December 31, 2013 were $3.3 million and
$12.3 million, respectively, compared with $2.6 million and $9.4
million for the comparable periods in 2012, and remained the
Company’s largest expense. The growth in research and development
expenses, net, for the fourth quarter and full year, reflects
increasing levels of activities in support of the Company’s
Pipeline Program, including a substantial increase in activities
relating to the research and development of monoclonal antibody
therapeutic candidates at Compugen's wholly-owned U.S.
subsidiary.
Compugen’s net loss for calendar 2013 was $14.1 million (after
reflecting non-cash stock-based compensation of $3.5 million), or
$0.36 per basic and diluted share, compared with a net loss of
$13.6 million (after reflecting non-cash stock-based compensation
of $2.5 million), or $0.38 per basic and diluted share, for 2012.
The increase in net loss for calendar 2013, compared with the same
period in 2012, resulted from increased corporate activities
primarily relating to research and development, partially offset by
an increase in revenues.
As of December 31, 2013 and 2012, the liability related to the
"Research and development funding arrangements and others" amounted
to $13.2 million and $7.9 million, respectively, resulting from the
accounting for the Baize research and development funding
arrangements signed in December 2011 and December 2010, as amended.
The liability balances are primarily related to the estimated fair
values of the embedded derivative instruments resulting from the
right of the investor, under the amended agreement, to waive its
right to receive potential future payments in exchange for Compugen
ordinary shares.
As of December 31, 2013, available resources totaled $51.3
million (consisting of cash related accounts totaling $46.8 million
and $4.5 million market value of Evogene shares owned by the
Company at such time) compared with $24.8 million (consisting of
cash related accounts totaling $19.6 million and $5.2 million
market value of Evogene shares) at December 31, 2012, representing
a net increase of $26.5 million for calendar year 2013. Compugen
has budgeted for calendar 2014 total cash uses of approximately $24
million. Compugen does not include in its budget any cash
anticipated to be received during the year from revenues, financing
activities or other sources. For calendar year 2013, such cash
actually received totaled approximately $42 million.
Conference Call and Webcast Information
Compugen will hold a conference call to discuss its fourth
quarter and yearend results today, February 11, 2014 at 10:00 a.m.
EST. To access the conference call, please dial 1-888-668-9141 from
the US or +972-3-918-0609 internationally. The call will also be
available via live webcast through Compugen’s website, located at
the following link.
A replay of the conference call will be available approximately
two hours after the completion of the live conference call. To
access the replay, please dial 1-888-782-4291 from the US or
+972-3-925-5918 internationally. The replay will be available
through February 14, 2014.
About CompugenCompugen is a leading drug discovery
company focused on therapeutic proteins and monoclonal antibodies
to address important unmet needs in the fields of immunology and
oncology. The Company utilizes a broad and continuously growing
integrated infrastructure of proprietary scientific understandings
and predictive platforms, algorithms, machine learning systems and
other computational biology capabilities for the in silico (by
computer) prediction and selection of product candidates, which are
then advanced in its Pipeline Program. The Company's business model
includes collaborations covering the further development and
commercialization of product candidates at various stages from its
Pipeline Program and various forms of research and discovery
agreements, in both cases providing Compugen with potential
milestone payments and royalties on product sales or other forms of
revenue sharing. Compugen’s wholly-owned U.S. subsidiary located in
South San Francisco is developing oncology and immunology
monoclonal antibody therapeutic candidates against its drug
targets. For additional information, please visit Compugen's
corporate website at www.cgen.com.
This press release contains “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of
1995, including statements related to the key objectives for 2014,
the increased R&D budget for 2014, and expected achievements
related thereto, and anticipated total cash uses for 2014.
Forward-looking statements can be identified by the use of
terminology such as “will,” “may,” “expects,” “anticipates,”
“believes,” and “intends,” and describe opinions about future
events. These forward-looking statements involve known and unknown
risks and uncertainties that may cause the actual results,
performance or achievements of Compugen to be materially different
from any future results, performance or achievements expressed or
implied by such forward-looking statements. Some of these risks
are: changes in relationships with collaborators; the inability to
reach mutually agreeable terms and conditions with respect to
potential new collaborations, the impact of competitive products
and technological changes; risks relating to the development of new
products; and the ability to implement technological improvements.
These and other factors are discussed in the "Risk Factors" section
of Compugen’s most recent Annual Report on Form 20-F as filed with
the Securities and Exchange Commission as well as other documents
that may be subsequently filed by Compugen from time to time with
the Securities and Exchange Commission. In addition, any
forward-looking statements represent Compugen’s views only as of
the date of this release and should not be relied upon as
representing its views as of any subsequent date. Compugen does not
assume any obligation to update any forward-looking statements
unless required by law.
COMPUGEN LTD. CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
(U.S. dollars in thousands, except for
share and per-share amounts)
Three Months EndedDecember 31,
Year EndedDecember 31,
2013
2012
2013
2012
Revenues 1,775 134 3,549 242 Cost of revenues
810
168
2,509
201
Gross profit 965
(34 )
1,040 41
Operating expenses Research and development expenses,
net 3,257 2,608 12,275 9,442 Marketing and business development
expenses 195 186 962 684 General and administrative expenses
1,471 1,013
4,846 3,457 Total
operating expenses 4,923
3,807 18,083
13,583 Operating loss
(3,958 ) (3,841 ) (17,043
) (13,542 ) Financing income (loss), net
1,375 (1,532 )
3,460 (86 ) Net
loss before taxes (2,583 ) (5,373 )
(13,583 ) (13,628 ) Taxes on income
(345 ) -
(500 ) - Net
loss (2,928 )
(5,373 )
(14,083 )
(13,628 ) Basic net
loss per ordinary share (0.07 ) (0.15 ) (0.36 ) (0.38 ) Weighted
average number of Ordinary shares used in computing basic net loss
per share 40,802,976 36,125,109 38,869,438 35,844,496 Diluted net
loss per ordinary share (0.09 ) (0.15 ) (0.36 ) (0.38 ) Weighted
average number of Ordinary shares used in computing diluted net
loss per share 42,738,997 36,125,109 38,869,438 36,249,262
COMPUGEN LTD. CONDENSED CONSOLIDATED
BALANCE SHEETS DATA
(U.S. dollars, in
thousands)
December 31,2013
December 31,2012
ASSETS Current assets Cash, cash equivalents and
short-term bank deposits 46,766 19,589 Investment in Evogene 4,565
5,196 Other accounts receivable and prepaid expenses
1,885 786 Total current assets
53,216 25,571 Non-current
investments Severance pay fund
2,129
1,728 Total non-current investments
2,129 1,728 Non-current prepaid
expenses 158 360 Property
and equipment, net 1,208 1,250
Total assets 56,711 28,909
LIABILITIES AND SHAREHOLDERS’ EQUITY Current
liabilities Other accounts payable, accrued expenses and trade
payables 2,421 1,384 Deferred revenue
5,318
- Total current liabilities 7,739
1,384 Non-current liabilities Research
and development funding arrangements and others 13,189 7,872
Deferred revenue 1,454 - Accrued severance pay
2,441
1,981 Total non-current liabilities
17,084 9,853 Total
shareholders’ equity 31,888 17,672
Total liabilities and shareholders’ equity
56,711 28,909
Compugen Ltd.Tsipi Haitovsky, Global Media
Liaison+972-52-598-9892tsipih@netvision.net.il
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