BIVN Bioenvision (MM)

Bioenvision (NasdaqGM:BIVN) today announced financial results for the first quarter ended September 30, 2006. Highlights of the quarter include: Bioenvision successfully conducted its Evoltra� (clofarabine) marketing launch at SIOP conference in September 2006; Bioenvision entered into a licensing agreement to acquire Evoltra� marketing rights in Japan and Southeast Asia; Bioenvision records $2.9 million of revenue for the quarter; up from $670,000 in the quarter ended September 30, 2005; Bioenvision appoints Vice President, Regulatory Affairs. �We continue to make strong progress in terms of Evoltra� marketing and development activities and in the build out of our infrastructure,� commented David P. Luci, Chief Financial Officer and General Counsel of Bioenvision. �We will now focus our development efforts on expanding Evoltra��s commercial potential,� said Dr. Christopher B. Wood, Bioenvision�s Chairman and Chief Executive Officer. �Our next target in Evoltra development is the filing, before year�s end, for approval with the European Commission to treat elderly patients with AML who are unfit for intensive chemotherapy. Then we plan to position Evoltra� into other hematology indications, such as MDS and chronic leukemia,� Dr. Wood added. For the three months ended September 30, 2006 and 2005, Bioenvision recorded revenues of $2,865,000 and $670,000, respectively. This increase of 328% is due to an increase in product sales of Evoltra� due to marketing approval received in Q4 of 2006 as well as an increase in license and royalty revenue of $590,000. Selling, General and Administrative expenses for the three months ended September 30, 2006 and 2005 were approximately $5,469,000 and $2,887,000, respectively. This increase of 89.4% is due to an increase in sales and marketing costs associated with the marketing launch of Evoltra� in September 2006. The Company also experienced an increase in expenses of approximately $1,403,000 relating to the build-up of a sales and marketing and administrative infrastructure throughout Europe upon approval of Evoltra� in May 2006. The Company also recognized an increase in the non-cash charge of stock-based compensation of $223,000. Research and development costs for the three months ended September 30, 2006 and 2005 were $9,270,000 and $2,431,000, respectively. This increase of 281.3% is due to the Company licensing clofarabine in Japan and Southeast Asia; a territory previously ungranted by clofarabine�s inventor. The increase is also due to the increased development activities and ongoing clinical trials of clofarabine for pediatric and adult leukemias and psoriasis. Excluding the one-time costs associated with our having licensed Evoltra� marketing rights in Japan and Southeast Asia, we would have recorded R&D costs for the three months ended September 30, 2006 and 2005 of $5,317,000 and $2,431,000, respectively (see Non-GAAP reconciliation set forth below). Net loss available to shareholders was $12,211,000, or $0.29 loss per share for the three months ended September 30, 2006, compared with net loss available to shareholders of $4,890,000, or $0.12 loss per share for the three months ended September 30, 2005. Bioenvision had cash and cash equivalents and short-term investments at September 30, 2006 of $35,777,000 compared with $45,015,000 at June 30, 2006. The decrease in the cash position is due to the cash burn associated with our licensing marketing rights to clofarabine in Japan and Southeast Asia as well as ongoing clinical trials for clofarabine and modrenal as well as general administrative costs associated with the marketing launch of Evoltra� and the implementation of a sales force within the EU. Reconciliation of Non-US GAAP Financial Measure Adjusted net loss applicable to common stockholders defined as net loss applicable to common shareholders less one-time expense for the Japanese license agreement recorded for the quarters ended September 30, 2006 and 2005, respectively. Quarter ended September 30, 2006� 2005� Net loss applicable to common stockholders, as reported $(12,210,762) $(4,889,660) � Add: One-time charge for Japanese license agreement 3,953,074� -� � Adjusted net loss applicable to common stockholders $(8,257,688) $(4,889,660) � Basic and diluted net loss per share of common stock, as reported $(0.29) $(0.12) � Adjusted basic and diluted net loss per share of common stock $(0.20) $(0.12) � Weighted-average shares used in computing basic & diluted net loss per share 41,456,942� 40,572,626� Conference Call Conference Call Information: Date: 11/9/06 Time: 12:00PM Eastern Toll free (US & Canada): 866-585-6398 International: 416-849-9626 Web cast: www.bioenvision.com A replay of the call and web cast will be available for 14 days. Replay number (US & Canada): 866-245-6755 Replay number international: 416-915-1035 Replay passcode: 816197 Web cast replay: www.bioenvision.com About Bioenvision Bioenvision's primary focus is the acquisition, development, distribution and marketing of compounds and technologies for the treatment of cancer. Bioenvision has a broad pipeline of products for the treatment of cancer, including: Evoltra�, Modrenal� (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. Bioenvision is also developing anti-infective technologies, including the OLIGON� technology; an advanced biomaterial that has been incorporated into various FDA approved medical devices and Suvus�, an antimicrobial agent currently in clinical development for refractory chronic hepatitis C infection. 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. BIOENVISION, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS � September 30, June 30, � 2006� � 2006� ASSETS (unaudited) � Current assets Cash and cash equivalents $ 4,215,118� $ 3,377,937� Short-term securities 31,562,264� 41,637,106� Accounts receivable, less allowances of $899,000 3,233,091� 2,369,446� Inventories 425,402� 427,514� Other current assets � 1,460,491� � 844,810� Total current assets 40,896,366� 48,656,813� � Property and equipment, net 288,193� 273,632� Intangible assets, net 7,337,322� 7,549,520� Goodwill 1,540,162� 1,540,162� Other assets 897,051� 706,840� Deferred costs � 3,463,197� � 3,523,497� Total assets $ 54,422,291� $ 62,250,464� � LIABILITIES AND STOCKHOLDERS� EQUITY � Current liabilities � Accounts payable $ 3,154,171� $ 1,557,507� Accrued expenses 8,064,329� 6,464,445� Accrued dividends payable 57,328� 56,404� Deferred revenue � 513,662� � 513,662� Total current liabilities 11,789,490� 8,592,018� � Other liabilities 703,074� -� Deferred revenue � 6,942,306� � 7,070,725� Total liabilities 19,434,870� 15,662,743� � Commitments and contingencies � Stockholders� equity Convertible participating preferred stock - $0.001 par value; 20,000,000 shares authorized; 2,250,000 shares issued and outstanding at September 30, 2006 and June 30, 2006 (liquidation preference $6,750,000) 2,250� 2,250� � Common stock - par value $0.001; 70,000,000 shares authorized; 41,458,616 and 41,456,616 shares issued and outstanding at September 30, 2006 and June 30, 2006, respectively 41,459� 41,457� � Additional paid-in capital 134,229,990� 133,604,996� Accumulated deficit (98,778,030) (86,567,268) Receivable from stockholder (300,000) (340,606) Accumulated other comprehensive loss � (208,248) � (153,108) Total stockholders� equity � 34,987,421� � 46,587,721� � Total liabilities and stockholders� equity $ 54,422,291� $ 62,250,464� BIOENVISION, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) � Three months ended September 30, � 2006� � 2005� � Revenue Product sales $ 1,874,494� $ 194,996� Licensing and royalty revenue 990,078� 400,130� Research and development contract revenue � -� � 75,092� � Total revenue 2,864,572� 670,218� � Costs and expenses Cost of products sold, including royalty expense of $361,000 and $201,000 for the three months ended September 30, 2006 and 2005, respectively 422,728� 328,291� � Research and development 9,269,582� 2,430,918� � Selling, general and administrative 5,468,891� 2,887,462� � Depreciation and amortization � 241,700� � 224,283� � Total costs and expenses � 15,402,901� � 5,870,954� � Loss from operations (12,538,329) (5,200,736) � Interest and finance charges (47,684) (66,761) Interest income � 460,319� � 462,905� � Net loss (12,125,694) (4,804,592) � Preferred stock dividend � (85,068) � (85,068) � Loss applicable to common stockholders $ (12,210,762) $ (4,889,660) � Basic and diluted net loss per share applicable to common stockholders $ (0.29) $ (0.12) � Weighted average shares used in computing � 41,456,942� � 40,572,626� basic and diluted net loss per share Bioenvision (NasdaqGM:BIVN) today announced financial results for the first quarter ended September 30, 2006. Highlights of the quarter include: -- Bioenvision successfully conducted its Evoltra(R) (clofarabine) marketing launch at SIOP conference in September 2006; -- Bioenvision entered into a licensing agreement to acquire Evoltra(R) marketing rights in Japan and Southeast Asia; -- Bioenvision records $2.9 million of revenue for the quarter; up from $670,000 in the quarter ended September 30, 2005; -- Bioenvision appoints Vice President, Regulatory Affairs. "We continue to make strong progress in terms of Evoltra(R) marketing and development activities and in the build out of our infrastructure," commented David P. Luci, Chief Financial Officer and General Counsel of Bioenvision. "We will now focus our development efforts on expanding Evoltra(R)'s commercial potential," said Dr. Christopher B. Wood, Bioenvision's Chairman and Chief Executive Officer. "Our next target in Evoltra development is the filing, before year's end, for approval with the European Commission to treat elderly patients with AML who are unfit for intensive chemotherapy. Then we plan to position Evoltra(R) into other hematology indications, such as MDS and chronic leukemia," Dr. Wood added. For the three months ended September 30, 2006 and 2005, Bioenvision recorded revenues of $2,865,000 and $670,000, respectively. This increase of 328% is due to an increase in product sales of Evoltra(R) due to marketing approval received in Q4 of 2006 as well as an increase in license and royalty revenue of $590,000. Selling, General and Administrative expenses for the three months ended September 30, 2006 and 2005 were approximately $5,469,000 and $2,887,000, respectively. This increase of 89.4% is due to an increase in sales and marketing costs associated with the marketing launch of Evoltra(R) in September 2006. The Company also experienced an increase in expenses of approximately $1,403,000 relating to the build-up of a sales and marketing and administrative infrastructure throughout Europe upon approval of Evoltra(R) in May 2006. The Company also recognized an increase in the non-cash charge of stock-based compensation of $223,000. Research and development costs for the three months ended September 30, 2006 and 2005 were $9,270,000 and $2,431,000, respectively. This increase of 281.3% is due to the Company licensing clofarabine in Japan and Southeast Asia; a territory previously ungranted by clofarabine's inventor. The increase is also due to the increased development activities and ongoing clinical trials of clofarabine for pediatric and adult leukemias and psoriasis. Excluding the one-time costs associated with our having licensed Evoltra(R) marketing rights in Japan and Southeast Asia, we would have recorded R&D costs for the three months ended September 30, 2006 and 2005 of $5,317,000 and $2,431,000, respectively (see Non-GAAP reconciliation set forth below). Net loss available to shareholders was $12,211,000, or $0.29 loss per share for the three months ended September 30, 2006, compared with net loss available to shareholders of $4,890,000, or $0.12 loss per share for the three months ended September 30, 2005. Bioenvision had cash and cash equivalents and short-term investments at September 30, 2006 of $35,777,000 compared with $45,015,000 at June 30, 2006. The decrease in the cash position is due to the cash burn associated with our licensing marketing rights to clofarabine in Japan and Southeast Asia as well as ongoing clinical trials for clofarabine and modrenal as well as general administrative costs associated with the marketing launch of Evoltra(R) and the implementation of a sales force within the EU. Reconciliation of Non-US GAAP Financial Measure Adjusted net loss applicable to common stockholders defined as net loss applicable to common shareholders less one-time expense for the Japanese license agreement recorded for the quarters ended September 30, 2006 and 2005, respectively. -0- *T Quarter ended September 30, 2006 2005 --------------- ------------ Net loss applicable to common stockholders, as reported $(12,210,762) $(4,889,660) Add: One-time charge for Japanese license agreement 3,953,074 - --------------- ------------ Adjusted net loss applicable to common stockholders $(8,257,688) $(4,889,660) =============== ============ Basic and diluted net loss per share of common stock, as reported $(0.29) $(0.12) Adjusted basic and diluted net loss per share of common stock $(0.20) $(0.12) Weighted-average shares used in computing basic & diluted net loss per share 41,456,942 40,572,626 *T -0- *T Conference Call Conference Call Information: Date: 11/9/06 Time: 12:00PM Eastern Toll free (US & Canada): 866-585-6398 International: 416-849-9626 Web cast: www.bioenvision.com A replay of the call and web cast will be available for 14 days. Replay number (US & Canada): 866-245-6755 Replay number international: 416-915-1035 Replay passcode: 816197 Web cast replay: www.bioenvision.com *T About Bioenvision Bioenvision's primary focus is the acquisition, development, distribution and marketing of compounds and technologies for the treatment of cancer. Bioenvision has a broad pipeline of products for the treatment of cancer, including: Evoltra(R), 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. Bioenvision is also developing anti-infective technologies, including the OLIGON(R) technology; an advanced biomaterial that has been incorporated into various FDA approved medical devices and Suvus(R), an antimicrobial agent currently in clinical development for refractory chronic hepatitis C infection. 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 CONDENSED CONSOLIDATED BALANCE SHEETS September 30, June 30, 2006 2006 ------------- ------------- ASSETS (unaudited) Current assets Cash and cash equivalents $ 4,215,118 $ 3,377,937 Short-term securities 31,562,264 41,637,106 Accounts receivable, less allowances of $899,000 3,233,091 2,369,446 Inventories 425,402 427,514 Other current assets 1,460,491 844,810 ------------- ------------- Total current assets 40,896,366 48,656,813 Property and equipment, net 288,193 273,632 Intangible assets, net 7,337,322 7,549,520 Goodwill 1,540,162 1,540,162 Other assets 897,051 706,840 Deferred costs 3,463,197 3,523,497 ------------- ------------- Total assets $ 54,422,291 $ 62,250,464 ============= ============= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable $ 3,154,171 $ 1,557,507 Accrued expenses 8,064,329 6,464,445 Accrued dividends payable 57,328 56,404 Deferred revenue 513,662 513,662 ------------- ------------- Total current liabilities 11,789,490 8,592,018 Other liabilities 703,074 - Deferred revenue 6,942,306 7,070,725 ------------- ------------- Total liabilities 19,434,870 15,662,743 Commitments and contingencies Stockholders' equity Convertible participating preferred 2,250 2,250 stock - $0.001 par value; 20,000,000 shares authorized; 2,250,000 shares issued and outstanding at September 30, 2006 and June 30, 2006 (liquidation preference $6,750,000) Common stock - par value $0.001; 41,459 41,457 70,000,000 shares authorized; 41,458,616 and 41,456,616 shares issued and outstanding at September 30, 2006 and June 30, 2006, respectively Additional paid-in capital 134,229,990 133,604,996 Accumulated deficit (98,778,030) (86,567,268) Receivable from stockholder (300,000) (340,606) Accumulated other comprehensive loss (208,248) (153,108) ------------- ------------- Total stockholders' equity 34,987,421 46,587,721 ------------- ------------- Total liabilities and stockholders' equity $ 54,422,291 $ 62,250,464 ============= ============= *T -0- *T BIOENVISION, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) Three months ended September 30, 2006 2005 ------------- ------------ Revenue Product sales $ 1,874,494 $ 194,996 Licensing and royalty revenue 990,078 400,130 Research and development contract revenue - 75,092 ------------- ------------ Total revenue 2,864,572 670,218 Costs and expenses Cost of products sold, including royalty 422,728 328,291 expense of $361,000 and $201,000 for the three months ended September 30, 2006 and 2005, respectively Research and development 9,269,582 2,430,918 Selling, general and administrative 5,468,891 2,887,462 Depreciation and amortization 241,700 224,283 ------------- ------------ Total costs and expenses 15,402,901 5,870,954 ------------- ------------ Loss from operations (12,538,329) (5,200,736) Interest and finance charges (47,684) (66,761) Interest income 460,319 462,905 ------------- ------------ Net loss (12,125,694) (4,804,592) Preferred stock dividend (85,068) (85,068) ------------- ------------ Loss applicable to common stockholders $(12,210,762) $(4,889,660) ============= ============ Basic and diluted net loss per share applicable to common stockholders $ (0.29) $ (0.12) ============= ============ Weighted average shares used in computing 41,456,942 40,572,626 ============= ============ basic and diluted net loss per share *T