SAN CARLOS, Calif., Feb. 24 /PRNewswire-FirstCall/ -- Nektar Therapeutics (Nasdaq: NKTR) today reported its financial results for the fourth quarter and year ended December 31, 2008.
"2008 was a transformational year for Nektar," said Howard W. Robin, President and Chief Executive Officer of Nektar. "Using our unique polymer conjugation chemistry platform, we advanced numerous proprietary drug candidates into clinical and preclinical development. Further, we significantly strengthened our financial position with the sale of pulmonary delivery assets and the buy-back of $100 million of convertible debt at a substantial discount. Nektar is exceptionally well-positioned as we enter 2009."
Fourth Quarter and Year-End 2008 Financial Results
Nektar completed two significant transactions during the fourth quarter of 2008:
- - The company repurchased $100.0 million of its 3.25% convertible subordinated notes for $47.8 million. As a result, the company recognized a gain of $50.1 million in the fourth quarter, net of transaction costs of $1.0 million and accelerated amortization of our deferred financing costs of $1.1 million.
- - Nektar completed the divestiture of certain of its pulmonary delivery assets to Novartis for $115.0 million on December 31, 2008. As a result of the completion of this transaction, the company recognized a gain of $69.6 million in the fourth quarter of 2008.
Cash, cash equivalents, and short-term investments at December 31, 2008 were $379.0 million.
Revenue for the three month period ended December 31, 2008 was $28.4 million compared to revenue of $65.8 million in the fourth quarter of 2007. For the twelve months of 2008, revenue was $90.2 million as compared to $273.0 million in the same period of 2007. This decrease in revenue is primarily the result of lower product manufacturing revenues due to the termination of the company's inhaled insulin collaboration with Pfizer in late 2007.
Research and development expense was $154.4 million in 2008 as compared to $153.6 million for 2007. Included in the $154.4 million of overall research and development spending is approximately $82.0 million of new investments in Nektar preclinical and clinical development programs.
Nektar has also continued to make improvements to its operating efficiencies as compared to a year ago. For the twelve months ended December 31, 2008, the company's general and administrative expense was $51.5 million as compared to $57.3 million for the same period a year ago.
Net income for the quarter ended December 31, 2008 was $76.8 million or $0.83 per share, compared to net income of $39.0 million or $0.42 per share in the fourth quarter of 2007. For the year 2008, the company reported a net loss of $34.3 million or $0.37 per share, compared to a net loss of $32.8 million or $0.36 per share for 2007.
Conference Call to Discuss Fourth Quarter and Year-End 2008 Financial Results
The company also announced that due to scheduling considerations, the conference call to review results will now be held on March 2, 2009 at 2 PM Pacific Time. Details are below:
Howard Robin, president and chief executive officer, and John Nicholson, chief financial officer, will host a conference call beginning at 5:00 p.m. Eastern Time (ET)/2:00 p.m. Pacific Time (PT) on Monday, March 2, 2009.
A live audio-only Webcast of the conference call can be accessed through a link that is posted on the home page and Investor Relations section of the Nektar website: http://www.nektar.com.
To access the conference call, follow these instructions: Dial: 800.561.2718 (U.S.); 617.614.3525 (international) Participant Passcode: 32041145 (Howard Robin is the host)
An audio replay will also be available shortly after the call and will remain so through March 16, 2009.
To access the replay, follow these instructions: Dial: 888-286-8010 (U.S.); 617-801-6888 (international) Participant Passcode: 44161634
Nektar Therapeutics is a biopharmaceutical company developing novel therapeutics based on its PEGylation and advanced polymer conjugate technology platforms. Nektar's technology and drug development expertise have enabled nine approved products for partners, which include leading biopharmaceutical companies. Nektar is also developing a robust pipeline of its own high-value therapeutics that addresses unmet medical needs by leveraging and expanding its technology platforms to improve and enable molecules. For more information on Nektar Therapeutics, please visit http://www.nektar.com.
This press release contains forward-looking statements that reflect the company's current views regarding the potential of the company's pipeline of proprietary drug candidates, the value and potential of the company's technology, and the company's financial position. These forward-looking statements involve numerous risks and uncertainties, including but not limited to: (i) the company's proprietary product candidates and those of its collaboration partners are in various stages of clinical development and the risk of failure is high and can unexpectedly occur at any stage of development prior to regulatory approval for numerous reasons including safety and efficacy findings; (ii) the timing or success of the commencement or end of clinical trials and commercial launch of partnered products may be delayed or unsuccessful due to slower than anticipated patient enrollment, drug manufacturing challenges, changing standards of care, clinical trial design, clinical outcomes, or delay or failure in obtaining regulatory approval in one or more important markets; (iii) the company's patent applications for its proprietary or partner product candidates may not issue, patents that have issued may not be enforceable, or intellectual property licenses from third parties may be required in the future; and (iv) the outcome of any future intellectual property or other litigation related to the company's proprietary product candidates or complex commercial agreements. Other important risks and uncertainties are detailed in the company's reports and other filings with the Securities and Exchange Commission, including its most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K. Actual results could differ materially from the forward-looking statements contained in this press release. The company undertakes no obligation to update forward-looking statements, whether as a result of new information, future events or otherwise.
Jennifer Ruddock, 650-631-4954 Nektar Therapeutics Susan Noonan, 212-966-3650 SAN Group NEKTAR THERAPEUTICS CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share information) (unaudited) Three-Months Ended Twelve-Months Ended December 31, December 31, 2008 2007 2008 2007 Revenue: Product sales and royalties $12,400 $26,702 $41,255 $180,755 Collaboration and other 15,952 39,071 48,930 92,272 Total revenue 28,352 65,773 90,185 273,027 Operating costs and expenses: Cost of goods sold 10,196 17,387 28,216 137,696 Other cost of revenue - 6,661 6,821 9,821 Research and development 45,279 39,310 154,417 153,575 General and administrative 13,835 14,233 51,497 57,282 Impairment of long lived assets 1,458 28,396 1,458 28,396 Gain on sale of pulmonary assets (69,572) - (69,572) - Gain on termination of collaborative agreements, net - (79,178) - (79,178) Litigation settlement - 1,583 - 1,583 Total operating costs and expenses 1,196 28,392 172,837 309,175 Income (Loss) from operations 27,156 37,381 (82,652) (36,148) Non-operating income (expense): Interest income 1,917 5,757 12,495 22,201 Interest expense (3,357) (4,230) (15,192) (18,638) Other income (expense), net (425) 944 58 1,133 Gain on extinguishment of debt 50,149 - 50,149 - Total non-operating income 48,284 2,471 47,510 4,696 Income (Loss) before provision for income taxes 75,440 39,852 (35,142) (31,452) Provision (benefit) for income taxes (1,342) 809 (806) 1,309 Net income (loss) $76,782 $39,043 $(34,336) $(32,761) Basic and diluted net earnings (loss) per share $0.83 $0.42 $(0.37) $(0.36) Shares used in computing basic and diluted net earnings (loss) per share (1) 92,473 92,211 92,407 91,876 Notes to Consolidated Statements of Operations (1) For the three-months ended December 31, 2008, there were approximately 81 dilutive shares which did not change earnings per share. NEKTAR THERAPEUTICS CONSOLIDATED BALANCE SHEETS (In thousands) (unaudited) December 31, December 31, ASSETS 2008 2007 (1) Current assets: Cash and cash equivalents $155,584 $76,293 Short-term investments 223,410 406,060 Accounts receivable, net of allowance 11,161 21,637 Inventory 9,319 12,187 Other current assets 6,746 7,106 Total current assets 406,220 523,283 Property and equipment, net 73,578 114,420 Goodwill 76,501 78,431 Other assets 4,237 8,969 Total assets $560,536 $725,103 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $13,832 $3,589 Accrued compensation 11,570 14,680 Accrued clinical trial expenses 17,622 2,895 Accrued expenses to contract manufacturers - 40,444 Accrued expenses 9,923 9,551 Deferred revenue, current portion 10,010 19,620 Other current liabilities 5,417 7,313 Total current liabilities 68,374 98,092 Convertible subordinated notes 214,955 315,000 Capital lease obligations 20,347 21,632 Deferred revenue 55,567 61,349 Deferred gain 5,901 8,680 Other long-term liabilities 5,238 5,911 Total liabilities 370,382 510,664 Commitments and contingencies Stockholders' equity: Preferred stock - - Common stock 9 9 Capital in excess of par value 1,312,796 1,302,541 Accumulated other comprehensive income 1,439 1,643 Accumulated deficit (1,124,090) (1,089,754) Total stockholders' equity 190,154 214,439 Total liabilities and stockholders' equity $560,536 $725,103 (1) The consolidated balance sheet at December 31, 2007 has been derived from the audited financial statements at that date but does not include all of the information and notes required by generally accepted accounting principles in the United States for complete financial statements. Certain 2007 amounts have been reclassified between line items to conform with the 2008 presentation. NEKTAR THERAPEUTICS CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (unaudited) Twelve-Months Ended December 31, 2008 2007 Cash flows provided by (used in) operating activities: Net loss $(34,336) $(32,761) Adjustments to reconcile net loss to net cash provided by (used in)operating activities: Gain on sale of pulmonary assets (69,572) - Gain on extinguishment of debt (50,149) - Depreciation and amortization 22,489 29,028 Stock-based compensation 9,871 14,779 Impairment of long lived assets 1,458 28,396 Other non-cash transactions 1,251 109 Changes in assets and liabilities: Decrease (increase) in trade accounts receivable 10,476 24,318 Decrease (increase) in inventories 2,868 1,503 Decrease (increase) in other assets 1,166 7,443 Increase (decrease) in accounts payable 6,181 (3,147) Increase (decrease) in accrued compensation (3,382) 986 Increase (decrease) in accrued clinical trial expenses 14,727 907 Increase (decrease) in accrued expenses to contract manufacturers (40,444) 40,444 Increase (decrease) in accrued expenses (1,332) (5,200) Increase (decrease) in deferred revenue (15,392) 40,863 Increase (decrease) in other liabilities (1,662) (1,366) Net cash provided by (used in) operating activities (145,782) 146,302 Cash flows from investing activities: Proceeds from sale of pulmonary assets, net of transactions cost 114,831 - Investment in Pearl Therapeutics (4,236) - Purchases of property and equipment (18,855) (32,796) Maturities of investments 587,832 591,202 Sales of investments 70,396 2,057 Purchases of investments (475,316) (593,118) Net cash provided by (used in) investing activities 274,652 (32,655) Cash flows from financing activities: Issuance of common stock, net of issuance costs 384 3,780 Payments of loan and capital lease obligations (2,368) (2,895) Repayments of convertible subordinated notes (47,757) (102,653) Net cash used in financing activities (49,741) (101,768) Effect of exchange rates on cash and cash equivalents 162 654 Net increase in cash and cash equivalents $79,291 $12,533 Cash and cash equivalents at beginning of year 76,293 63,760 Cash and cash equivalents at end of year $155,584 $76,293
|SOURCE Nektar Therapeutics|
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