RNS Number:4307H
Cambridge Antibody Tech Group PLC
13 February 2003
03/CAT/07
FOR IMMEDIATE RELEASE
07.00 GMT 02.00 EST Thursday 13 February 2003
For Further Information Contact: Weber Shandwick Square Mile (Europe)
Cambridge Antibody Technology Tel: +44 (0) 20 7067 0700
Tel: +44 (0) 1223 471 471 Kevin Smith
Peter Chambre, Chief Executive Officer Graham Herring
John Aston, Chief Financial Officer
Rowena Gardner, Director of Corporate
Communications
BMC Communications/The Trout Group (USA)
Tel: +1 212 477 9007
Brad Miles, ext. 17 (media)
Brandon Lewis, ext. 15 (investors)
CAMBRIDGE ANTIBODY TECHNOLOGY GROUP PLC
ANNOUNCES FIRST QUARTER RESULTS
Cambridge, UK... Cambridge Antibody Technology Group plc (LSE: CAT; NASDAQ:
CATG) today announces financial results for the first quarter of its 2003
financial year, from 1 October 2002 to 31 December 2002.
Since the time of CAT's preliminary results announcement for the year ending
September 2002 in November there has been significant progress in products under
development, important agreements in the patents and licensing area and, most
recently, the announcement of the proposed merger with Oxford GlycoSciences
(OGS).
On 31 December 2002, Abbott Laboratories announced that it had received US Food
and Drug Administration (FDA) approval to market HumiraTM (adalimumab,
previously known as D2E7) for the treatment of rheumatoid arthritis (RA),
earlier than anticipated. Humira was isolated and optimised by CAT and Abbott as
part of a collaboration and is the first CAT-derived human monoclonal antibody
to receive approval for marketing. It is also the first human monoclonal
antibody approved for reducing the signs and symptoms and inhibiting the
progression of structural damage in adults with moderately to severely active RA
who have had insufficient response to one or more traditional disease modifying
antirheumatic drugs (DMARDs). Abbott owns exclusive worldwide rights to Humira,
including responsibility for clinical development, manufacturing, sales and
marketing. Abbott will book all revenues for Humira, and CAT will receive a
royalty fee based on Humira sales. The European Agency for the Evaluation of
Medicinal Products (EMEA) accepted Abbott's submission for Humira for the
treatment of RA in April 2002, and Abbott anticipates approval in mid-2003.
CAT has been granted regulatory clearance from the FDA to begin clinical trials
of TrabioTM (lerdelimumab, CAT-152; pronounced "trab-beeo") for use in
conjunction with glaucoma surgery in the United States. Study initiation is
expected in the first quarter of 2003. Recruitment continues in the Phase II/III
European and Phase III International trials. Discussions continue with a number
of potential partners, with a view to the partner marketing and selling Trabio.
Patient recruitment in the Phase I/II clinical trial of CAT-192 (metelimumab) as
a potential treatment for diffuse systemic sclerosis (being conducted by CAT's
partner Genzyme) has been completed. 45 Patients in four countries have been
enrolled and data are expected to be available in the fourth quarter of 2003.
In the Phase I/II allergen challenge study of CAT-213 in allergic
conjunctivitis, patient recruitment is on schedule and nearly completed. Data
are expected to be available in the third quarter of 2003.
Human Genome Sciences, Inc. (HGSI), has reported that it has completed patient
enrolment in a Phase I clinical trial to evaluate LymphoStat-BTM for use in the
treatment of systemic lupus erythematosus and plans to have results available in
the first half of 2003.
Following a period of significant activity, CAT has now successfully resolved
all of its principal outstanding patent litigation. In December 2002, CAT
settled all patent disputes with MorphoSys and Crucell. These agreements
demonstrate the strength of CAT's patent position and provide evidence of CAT's
commitment to licensing its patent portfolio. They also give CAT a stake in the
future success of these companies, as well as putting an end to the distraction
caused by litigation. In addition, also in December, CAT entered into a
cross-licensing arrangement with XOMA for antibody-related technologies. In
January 2003, CAT announced an agreement with Dyax Corporation to expand access
and freedom to operate under each other's phage display patents, an agreement
which also included the removal of CAT's obligation to pay royalties to Dyax on
antibody products it develops, except in respect of Humira.
In January 2003, CAT and Pharmacia agreed a short extension to the term of their
research collaboration, which was due to expire this month. CAT expects further
discussions on the future of this collaboration to take place later this year.
In January 2003, the Boards of CAT and OGS announced that they have agreed the
terms of a recommended merger to create a leading European biotechnology company
with greatly enhanced scientific, organisational and financial scale and
resources. The merger is subject to a number of conditions, including the
approval of shareholders of both CAT and OGS at meetings to be held on 11 March
2003. Documents relating to this merger, which is expected to complete by the
end of March, were posted to shareholders on 6 February 2003.
CAT is pleased to have welcomed two new Non-Executive Directors, Ake Stavling
and Peter Ringrose, who will add strength and significant expertise to its
Board. Mr Stavling has extensive senior management experience covering finance
and the pharmaceutical industry, and succeeds Jim Foght, who has retired from
CAT's Board of Directors, as chairman of the Audit Committee. Dr Ringrose is an
eminent scientist and has successfully led research and development
organisations at the pinnacle of the pharmaceutical industry.
Financial results
CAT made a loss for the three months ended 31 December 2002 of #10.5 million
(three months ended 31 December 2001: #4.0 million; year ended 30 September
2002: #28.2 million). Net cash outflow before management of liquid resources and
financing for the period was #7.2 million (three months ended 31 December 2001:
#2.8 million; year ended 30 September 2002: #28.3 million). Cash and liquid
resources at 31 December 2002 amounted to #123.7 million (31 December 2001:
#154.6 million; 30 September 2002: #129.8 million).
Revenues in the period were #1.4 million (three months ended 31 December 2001:
#1.9 million; year ended 30 September 2002: #9.5 million). Technical milestone
payments of #0.2 million were received from Pharmacia in December 2002. During
the period, revenues recognised from licence fees were #0.4 million, principally
licence fees released from deferred income brought forward at 30 September 2002.
Revenues of #0.6 million were generated from contract research fees under
ongoing collaborations with HGSI, Merck & Co., Inc.and Wyeth-Ayerst.
Operating costs for the period amounted to #13.2 million (three months ended 31
December 2001: #7.7 million; year ended 30 September 2002: #47.5 million). Since
31 December 2001, research and development expenses have risen in line with the
increased activity on clinical trials. Included in the period is the one-off
cost of the cross-licensing arrangement with Xoma for antibody-related
technologies; part of this was paid in the period and a further part is due in
the current quarter. During the period, the cost of patent litigation, including
patent oppositions and legal costs associated with the settlements, was #0.2
million (three months ended 31 December 2001: #0.2 million; year ended 30
September 2002: #2.3 million).
During the period the Group earned interest on its cash deposits of #1.3 million
(three months ended 31 December 2001: #1.9 million; year ended 30 September
2002: #6.4 million) reflecting the level of cash and liquid resources held in
interest bearing securities and prevailing rates of return, which have declined
in recent periods.
Creditors increased during the period with the receipt of two up front licence
fees from Merck and Chugai.
During the period, the Group established a finance leasing facility under which
equipment with a cost of #0.5 million has been financed. This is repayable over
four years.
CAT received a research and development tax credit during the period of #2.6
million (three months ended 31 December 2001: none; year ended 30 September
2002: #0.9 million).
Purchases of tangible fixed assets for the period were #2.8 million (three
months ended 31 December 2001: #0.9 million; year ended 30 September 2002: #7.9
million). The majority of the expenditure was on the final fit out costs of the
new premises at Granta Park. Purchases of intangible fixed assets represent the
second and final instalment on the Incyte Lifeseq(R) Gold database licence paid
to Incyte in October 2002.
CAMBRIDGE ANTIBODY TECHNOLOGY GROUP plc
RESULTS FOR THE THREE MONTHS ENDED 31 DECEMBER 2002
CONSOLIDATED PROFIT AND LOSS ACCOUNT
(unaudited) Convenience Three Three Year
translation months months ended 30
ended 31 ended 31 September
Three months December December 2002
ended 31 2002 2001
December 2002
US $'000 #'000 #'000 #'000
Turnover 2,261 1,405 1,878 9,471
Direct costs (14) (9) (84) (80)
Gross profit 2,247 1,396 1,794 9,391
Research and development expenses (18,081) (11,234) (6,110) (31,307)
Drug Royalty Corporation - - - (7,913)
transaction costs
Other general and (3,232) (2,008) (1,557) (8,321)
administration expenses
General and administration expenses (3,232) (2,008) (1,557) (16,234)
Operating loss (19,066) (11,846) (5,873) (38,150)
Interest receivable (net) 2,102 1,306 1,860 6,386
Loss on ordinary activities before (16,964) (10,540) (4,013) (31,764)
taxation
Taxation loss on ordinary activities - - - 3,557
Loss for the financial period (16,964) (10,540) (4,013) (28,207)
Loss per share - basic and diluted (pence) 29.1p 11.3p 78.7p
Consolidated Statement of Total Recognised Gains and Losses
Convenience Three Three months Year ended
translation months ended 31 30
ended December September
Three 2001 2002
months 31 December
ended 2002
31 December
2002
US $'000 #'000 #'000 #'000
Loss for the financial period (16,964) (10,540) (4,013) (28,207)
Gain (loss) on foreign exchange 412 256 (28) 96
translation
Total recognised losses relating to (16,552) (10,284) (4,041) (28,111)
the period
The losses for all periods arise from continuing operations.
This financial information has been prepared in accordance with UK GAAP. The
dollar translations are solely for the convenience of the reader.
CAMBRIDGE ANTIBODY TECHNOLOGY GROUP plc
Results for the THREE MONTHS ended 31 DECEMBER 2002
Consolidated Balance Sheet
(unaudited) Convenience As at 31 As at 31 As at 30
translation December December September
2002
as at 2001 2002
31 December
2002 #'000
#'000 #'000
US $'000
Fixed assets
Intangible assets 12,346 7,671 8,721 7,933
Tangible fixed assets 22,384 13,907 6,749 12,429
Investments 346 215 215 215
35,076 21,793 15,685 20,577
Current assets
Debtors 8,215 5,104 4,071 6,556
Investment in liquid resources 187,425 116,449 150,773 126,694
Cash at bank and in hand 12,305 7,645 3,847 3,081
207,945 129,198 158,691 136,331
Creditors
Amounts falling due within one year (25,791) (16,024) (12,979) (12,563)
Net current assets 182,154 113,174 145,712 123,768
Total assets less current 217,230 134,967 161,397 144,345
liabilities
Creditors
Amounts falling due after more than (14,161) (8,798) (8,374) (8,580)
one year
Net assets 203,069 126,169 153,023 135,765
Capital and reserves
Called-up share capital 5,851 3,635 3,553 3,621
Share premium account 327,063 203,208 195,795 202,534
Other reserve 21,657 13,456 13,451 13,456
Profit and loss account (151,502) (94,130) (59,776) (83,846)
Shareholders' funds - all equity 203,069 126,169 153,023 135,765
This financial information has been prepared in accordance with UK GAAP. The
dollar translations are solely for the convenience of the reader.
CAMBRIDGE ANTIBODY TECHNOLOGY GROUP plc
Results for the THREE MONTHS ended 31 DECEMBER 2002
Consolidated Cash Flow Statement
(unaudited) Convenience Three months Three Year ended
translation ended 31 months 30
December ended 31 September
Three 2002 December 2002
months 2001
ended
31 December
2002
US $'000 #'000 #'000 #'000
Net cash outflow from operations (8,713) (5,414) (4,297) (26,808)
Returns on investments and servicing
of finance
Interest received 1,687 1,048 2,393 7,558
Taxation 4,244 2,637 - 920
Capital expenditure and financial
investment
Purchase of intangible assets (4,303) (2,673) - (2,067)
Purchase of tangible fixed assets (4,548) (2,826) (911) (7,894)
Sale of tangible fixed assets - - - -
(8,851) (5,499) (911) (9,961)
Net cash outflow before management (11,633) (7,228) (2,815) (28,291)
of liquid resources and financing
Management of liquid resources 16,489 10,245 5,455 29,534
Financing
Issue of ordinary share capital 1,107 688 785 1,448
Proceeds from new finance lease 811 504 - -
commitment
Capital elements of finance lease (58) (36) - -
rental payments
1,860 1,156 785 1,448
Increase in cash 6,716 4,173 3,425 2,691
This financial information has been prepared in accordance with UK GAAP. The
dollar translations are solely for the convenience of the reader.
Notes to the financial information
Accounting policies
This financial information has been prepared in accordance with the policies set
out in the statutory financial statements for the year ended 30 September 2002.
Convenience translation
The consolidated financial statements are presented in pounds sterling. The
consolidated financial statements as of and for the period ended 31 December
2002 are also presented in United States Dollars as a convenience translation.
The Dollar amounts are presented solely for the convenience of the reader and
have been calculated using an exchange rate of #1:US$1.6095, the noon buying
rate as of 31 December 2002. No representation is made that the amounts could
have been or could be converted into United States Dollars at this or any other
rates.
Drug Royalty Corporation transaction costs
General and administration expenses include #7.9 million of costs incurred in
the year ended 30 September 2002 relating to the two transactions entered into
with Drug Royalty Corporation Inc. of Canada (DRC) during the year. In January
2002, CAT announced a recommended offer for the whole of DRC. A competing offer
was made by Inwest Investments Ltd of Canada which was accepted in April 2002.
Under an agreement with DRC, the Group received a payment of #1.5 million in
1994 in return for rights to a percentage of revenues (and certain other
payments) received by the Group over a period terminating in 2009. The #1.5
million was deferred and recognised over the period for which the rights were
purchased. On 2 May 2002, CAT bought out this royalty obligation to DRC for #6.1
million (C$14 million) with the issue of 463,818 CAT shares to DRC. The
remaining balance of #0.6 million of deferred income was then released. The
professional fees incurred in the Group's bid and royalty buy-back were #1.8
million.
Loss per share
The loss per ordinary share and diluted loss per share are equal because share
options are only included in the calculation of diluted earnings per share if
their issue would decrease the net profit per share or increase the net loss per
share. The calculation is based on the following: for the three months ended 31
December 2002, the three months ended 31 December 2001 and the year ended 30
September 2002 respectively. Losses of #10,540,000, #4,013,000, and #28,207,000.
Weighted average number of shares in issue of 36,260,545, 35,481,104 and
35,828,446. The Company has ordinary shares in issue of 36,352,686 and a total
of 1,771,555 ordinary shares under option as of 31 December 2002.
Reconciliation of operating loss to operating cash outflow
US $'000 #'000 #'000 #'000
Operating loss (19,066) (11,846) (5,873) (38,150)
Depreciation charge 1,168 726 698 2,617
Amortisation of intangible fixed 422 262 94 882
assets
Shares issued to buy out DRC royalty - - - 6,149
agreement
Loss on disposal of fixed assets 11 7 - -
Increase/(Decrease) in debtors (1,490) (926) 342 (158)
Increase in creditors 10,242 6,363 441 1,852
(8,713) (5,414) (4,297) (26,808)
Analysis and reconciliation of net funds
1 October Cash flow Exchange 31
movement
2002 December
2002
#'000 #'000 #'000 #'000
Cash at bank and in hand 3,081 4,579 (15) 7,645
Overdrafts - (406) (406)
4,173
Finance leases (468) (468)
(468)
Liquid resources 126,694 (10,245) 116,449
Net funds 129,775 (6,540) (15) 123,220
Three months Year ended
ended 31 30
December September
2002 2002
#'000 #'000
Increase in cash in the period 4,173 2,691
Cash inflow from increase in lease financing (468) -
Decrease in liquid resources (10,245) (29,534)
Change in net funds resulting from cash flows (6,540) (26,843)
Exchange movement (15) (32)
Movement in net funds in period (6,555) (26,875)
Net funds at 1 October 2002 129,775 156,650
Net funds at 31 December 2002 123,220 129,775
Reconciliation of movements in group shareholders' funds
Three months Year ended
ended 31 30
December September
2002 2002
#'000 #'000
Loss for the financial period (10,540) (28,207)
Other recognised gains and losses relating to the period 256 325
(10,284) (27,882)
New shares issued 688 7,597
Net decrease (9,596) (20,285)
Opening shareholders' funds 135,765 156,050
Closing shareholders' funds 126,169 135,765
Financial Statements
The preceding information, comprising the Consolidated Profit and Loss Account,
Consolidated Statement of Total Recognised Gains and Losses, Consolidated
Balance Street, Consolidated Cash Flow Statement and associated notes, does not
constitute the Company's statutory financial statements for the year ended 30
September 2002 within the meaning of section 240 of the Companies Act 1985, but
is derived from those financial statements. Results for the three months periods
ended 31 December 2002 and 31 December 2001 have not been audited. The results
for the year ended 30 September 2002 have been extracted from the statutory
financial statements which have been filed with the Registrar of Companies and
upon which the auditors reported without qualification.
The annual report and financial statements for the year ended 30 September 2002
are available from our registered office:
The Company Secretary
Cambridge Antibody Technology Group plc
Milstein Building
Granta Park
Cambridge
CB1 6GH, UK
Tel: +44 (0) 1223 471 471
-ENDS-
Notes to Editors:
Cambridge Antibody Technology (CAT)
CAT is a UK-based biotechnology company using its proprietary technologies and
capabilities in human monoclonal antibodies for drug discovery and drug
development. Based near Cambridge, England, CAT currently employs around 290
people.
CAT is a leader in the discovery and development of human therapeutic antibodies
and has an advanced proprietary platform technology for rapidly isolating human
monoclonal antibodies using phage display systems. CAT has extensive phage
antibody libraries, currently incorporating more than 100 billion distinct
antibodies. These libraries form the basis for the Company's strategy to develop
a portfolio of antibody-based drugs.
HumiraTM, the leading CAT-derived antibody, isolated and optimised in
collaboration with Abbott, has been approved by the US Food and Drug
Administration for marketing in the US as a treatment for rheumatoid arthritis.
Six further CAT-derived human therapeutic antibodies are at various stages of
clinical trials.
CAT has alliances with a large number of pharmaceutical and biotechnology
companies to discover, develop and commercialise human monoclonal antibody-based
products. CAT has also licensed its proprietary human phage antibody libraries
to several companies for target validation and drug discovery. CAT's
collaborators include: Abbott, Amgen, Amrad, Chugai, Elan, Genzyme, Human Genome
Sciences, Merck & Co, Pharmacia and Wyeth Research.
CAT is listed on the London Stock Exchange and on NASDAQ since June 2001. CAT
raised #41m in its IPO in March 1997 and #93m in a secondary offering in March
2000.
Application of the Safe Harbor of the US Private Securities Litigation Reform
Act of 1995: This press release contains statements about CAT that are forward
looking statements. All statements other than statements of historical facts
included in this press release may be forward looking statements within the
meaning of Section 21E of the US Securities Exchange Act of 1934.
These forward looking statements are based on numerous assumptions regarding
CAT's present and future business strategies and the environment in which CAT
will operate in the future. Certain factors that could cause CAT's actual
results, performance or achievements to differ materially from those in the
forward looking statements include: market conditions, CAT's ability to enter
into and maintain collaborative arrangements, success of product candidates in
clinical trials, regulatory developments and competition.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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