BIVN Bioenvision (MM)

Bioenvision (NASDAQ NM:BIVN) today announced financial results for the first quarter ended September 30, 2005. Highlights of the quarter include: -- Patient enrollment completed in a Phase II regulatory trial of clofarabine for treatment of elderly patients with adult AML who are deemed unfit for intensive chemotherapy; -- EMeA provided a final list of outstanding issues regarding pending application for approval of clofarabine in pediatric patients with ALL; -- Revenues decreased 38.2% based on discontinued recordation of revenues from Genzyme Corporation; and -- Revenues, as adjusted for amounts invoiced to Genzyme not recorded as revenues for the quarter, increased 24.9%. "We continue to make progress developing our product portfolio including clofarabine, which is at market in the US and under review for marketing authorization in Europe, and Virostat, which may well play significantly in terms of value drivers for the Company in the future," commented Christopher B. Wood, M.D., chairman and chief executive officer of Bioenvision. "We have submitted a Marketing Authorization Application, the European equivalent of a U.S. New Drug Application, with the European Medicines Evaluation Agency (EMeA) for European approval of clofarabine in relapsed or refractory pediatric acute leukemia." Dr. Wood continued, "We hope to continue the clofarabine development process with a filing for approval with the EMeA in H1C06 in elderly patients with AML who are unfit for intensive chemotherapy. In addition to these approved cancer therapeutics, the Company has completed enrollment of a Phase II clinical trial with Virostat for the treatment of Hepatitis C." For the three months ended September 30, 2005 and 2004, Bioenvision recorded revenues of $670,000 and $1.1 million, respectively. This decrease of 38.2% is due to a decrease in R&D contract revenue of $657,000 offset by an increase in product sales of $195,000 and license and royalty revenue of $47,000. The decrease in R&D contract revenue is due to the Company's exclusion of approximately $685,000 of amounts invoiced to Genzyme Corporation during the quarter but not recorded as revenues. R&D contract revenues during the quarter adjusted for such amounts invoiced for clofarabine R&D reimbursements increased 24.9% as compared with R&D contract revenues recorded for the three-months ended September 30, 2004. SG&A expenses for the three months ended September 30, 2005 and 2004 were approximately $2.9 million and $1.8 million, respectively. This increase of 64.4% is due both to an increase in costs associated with sales and marketing costs due to the expansion of regulatory and investor relations initiatives and an increase in head count in both the New York and Edinburgh offices. Research and development costs for the three months ended September 30, 2005 and 2004 were $2.4 million, compared with $2.1 million, respectively. This increase of 13.7% is due to costs primarily associated with the increased development activities and ongoing clinical trials for clofarabine for pediatric leukemia in Europe, adult AML (Acute Myeloid Leukemia) and Virostat for ongoing, multi-center investigator sponsored Phase II clinical trials being conducted in Egypt and Southern Europe. Net loss available to shareholders was $4.9 million, or $0.12 per share for the three months ended September 30, 2005, compared with net loss available to shareholders of $3.2 million, or $0.11 per share for the three months ended September 30, 2004. Bioenvision had cash and cash equivalents and short-term investments at September 30, 2005 of $60.4 compared with $64.1 million at June 30, 2005. The decrease in the cash position is due to the cash burn associated with clinical trials for clofarabine and virostat as well as general administrative costs. Conference Call Bioenvision management will host a conference call to discuss these results today at 8:00 a.m. EST. To participate in the live call by telephone, please dial 877-825-5811 from the U.S. and Canada or 973-582-2767 from outside the U.S. A telephone replay of the call will be available beginning at 10:00 a.m. EST November 14 until 11:59 p.m. EST November 28th by dialing 877-519-4471 or 973-341-3080 and entering reservation number 6701150. Those interested in listening to the conference call live via the Internet may do so by visiting Bioenvision's web site at www.bioenvision.com. To listen to the live call, please go to the web site 15 minutes prior to its start to register, download, and install the necessary audio software. A replay will be available on the web site for 14 days. About Bioenvision Bioenvision's primary focus is the acquisition, development and distribution of compounds and technologies for the treatment of cancer. Bioenvision has a broad pipeline of products for the treatment of cancer, including: Clofarabine (in co-development with Genzyme Corporation), Modrenal(R) (for which Bioenvision has obtained regulatory approval for marketing in the United Kingdom for the treatment of post-menopausal breast cancer following relapse to initial hormone therapy), and other products in clinical trials. Bioenvision is also developing anti-infective technologies, including Virostat for hepatitis-C and the OLIGON technology; an advanced biomaterial that has been incorporated into various FDA approved medical devices. For more information on Bioenvision please visit our web site at www.bioenvision.com. Certain statements contained herein are "forward-looking" statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because these statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Specifically, factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to: risks associated with preclinical and clinical developments in the biopharmaceutical industry in general and in Bioenvision's compounds under development in particular; the potential failure of Bioenvision's compounds under development to prove safe and effective for treatment of disease; uncertainties inherent in the early stage of Bioenvision's compounds under development; failure to successfully implement or complete clinical trials; failure to receive marketing clearance from regulatory agencies for our compounds under development; acquisitions, divestitures, mergers, licenses or strategic initiatives that change Bioenvision's business, structure or projections; the development of competing products; uncertainties related to Bioenvision's dependence on third parties and partners; and those risks described in Bioenvision's filings with the SEC. Bioenvision disclaims any obligation to update these forward-looking statements. -0- *T Bioenvision, Inc. and Subsidiaries CONSOLIDATED BALANCE SHEETS (unaudited) September 30, June 30, 2005 2005 ------------ ----------- ASSETS Current assets Cash and cash equivalents $ 12,208,760 $ 31,407,533 Restricted cash 290,000 290,000 Short-term securities 48,209,088 32,746,948 Accounts receivable, less allowances of $869,220 and $869,220, respectively 1,403,542 1,785,779 Inventory 361,741 277,908 Other current assets 781,060 342,628 ------------ ------------ Total current assets 63,254,191 66,850,796 Property and equipment, net 290,068 279,778 Intangible assets, net 8,155,836 8,252,936 Goodwill 1,540,162 1,540,162 Security deposits 208,475 209,665 Deferred costs 3,599,006 3,656,798 ------------ ------------ Total assets $ 77,047,738 $ 80,790,135 ============ ============ LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable $ 1,755,461 $ 1,602,267 Accrued expenses 5,266,932 4,581,444 Accrued dividends payable 57,329 56,404 Deferred revenue 498,607 498,607 ------------ ------------ Total current liabilities 7,578,329 6,738,722 Deferred revenue 7,312,945 7,437,598 ------------ ------------ Total liabilities 14,891,274 14,176,320 Commitments and contingencies - - Stockholders' equity Convertible preferred stock - $0.001 par value; 20,000,000 shares authorized; 2,250,000 shares issued and outstanding on each of September 30, 2005 and June 30, 2005 (liquidation preference $6,750,000) 2,250 2,250 Common stock - par value $0.001; 70,000,000 shares authorized; 40,760,763 and 40,448,948 shares issued and outstanding at September 30, 2005 and June 30, 2005, respectively 40,761 40,559 Additional paid-in capital 129,282,618 128,946,717 Deferred compensation - (145,646) Accumulated deficit (67,220,665) (62,331,005) Accumulated other comprehensive income 51,500 100,940 ------------ ------------ Stockholders' equity 62,156,464 66,613,815 ------------ ------------ Total liabilities and stockholders' equity $ 77,047,738 $ 80,790,135 ============ ============ Bioenvision, Inc. and Subsidiaries CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) Three months ended September 30, 2005 2004 ----------- ----------- (Restated) Revenue Licensing and royalty revenue $ 400,130 $ 363,182 Product sales 194,996 - Research and development contract revenue 75,092 722,146 ----------- ----------- Total revenue 670,218 1,085,328 Costs and expenses Cost of products sold (including royalty expense of $201,000 for the three months ending September 30, 2005) 328,291 - Research and development 2,430,918 2,138,897 Selling, general and administrative (including stock based compensation expense of $482,000 and $391,000 for the three months ending September 30, 2005 and 2004, respectively) 2,887,462 1,756,713 Depreciation and amortization 224,283 339,706 ----------- ----------- Total costs and expenses 5,870,954 4,235,316 ----------- ----------- Loss from operations (5,200,736) (3,149,988) Interest and finance charges (66,761) - Interest income 462,905 55,437 ----------- ----------- Net loss (4,804,592) (3,094,551) Cumulative preferred stock dividend (85,068) (126,341) ----------- ----------- Net loss available to common stockholders $(4,889,660)$(3,220,892) =========== =========== Basic and diluted net loss per share of common stock $(0.12) $(0.11) ======= ======= Weighted average shares used in computing basic and diluted net loss per share 40,572,626 28,516,450 =========== =========== *T