SAN DIEGO, March 26 /PRNewswire-FirstCall/ -- Cardium Therapeutics (NYSE Amex: CXM) today reported highlights and financial results for its fourth quarter and fiscal year ended December 31, 2008, and other important recent developments and outlook for 2009.
Recent Developments and 2009 Outlook
Cardium's business is focused on the acquisition and strategic development of product opportunities or businesses having the potential to address significant unmet medical needs, and definable pathways to commercialization, partnering or other monetization. As our product opportunities and businesses are advanced and corresponding valuations established, we intend to consider various corporate development transactions designed to place our product candidates into larger organizations or with partners having existing commercialization, sales and marketing resources, and a need for innovative products. Such transactions could involve the sale, partnering or other monetization of particular product opportunities or businesses. In November 2008, Cardium reported that it was focusing principal near-term efforts on its InnerCool Therapies and Tissue Repair subsidiaries - both of which we believe are nearing completion of their strategic development programs initiated in 2006.
InnerCool Therapies completed its high-performance endovascular-based cooling system, RapidBlue(TM), and the system was cleared by the FDA in late 2008. InnerCool also developed a new class of targeted organ-specific cooling applications, including its UroCool(TM) pelvic cooling catheter system, which is designed to induce localized cooling during surgery for prostate cancer. An application for FDA 510(k) clearance of the UroCool(TM) system was submitted in the first quarter of 2009.
Tissue Repair Company successfully advanced its MATRIX Phase 2b clinical study, which is principally designed to evaluate the ability of Excellarate(TM) to promote rapid closure of previously non-healing diabetic foot ulcers, and to gather additional information regarding safety and clinical use. Enrollment in the MATRIX clinical study is expected to be completed and select top line data announced shortly. In keeping with Cardium's business model, we expect to consider strategic partnering or other transactions designed to further advance these products to commercialization.
InnerCool was acquired by Cardium in 2006. As a result of Cardium's efforts, InnerCool is now uniquely positioned with a portfolio of temperature modulation therapy products and products under development that include endovascular and surface-based systems (for cooling and warming) that are easy to use and address a wide range of care environments, such as emergency vehicles, emergency rooms and intensive care units, and in operating room settings such as in neurology, cardiac and urology surgeries. In addition, through Cardium's investment, InnerCool's product portfolio and pipeline of new and innovative future products are supported by a fully-integrated 29,000 square foot cGMP facility with R&D and manufacturing capabilities. InnerCool is also positioned to benefit from participation in cutting-edge research efforts with the potential to broaden the applicability of patient temperature modulation for advanced therapies.
Consistent with Cardium's business strategy, the Company believes that InnerCool has reached a significant valuation inflection point within Cardium's investment portfolio, and with the appropriate strategic positioning, best-in-class products and a pipeline of innovative product opportunities, Cardium intends to advance InnerCool's therapeutic cooling and warming products into corresponding markets through the strategic sale of the business to a large and diversified medical device company or through various vertical partnering opportunities with established companies having existing sales and marketing organizations but with a continuing need for innovative, high-value content products. The Company believes this strategy is more cost-effective than building InnerCool into a fully integrated manufacturing, sales and marketing organization. Recent highlights and ongoing product development and clinical research activities at InnerCool include the following:
Tissue Repair Company
The Tissue Repair Company (TRC) was also acquired by Cardium in 2006. TRC's product candidate, Excellarate(TM), is a DNA-based topical gel designed to be administered once or twice for the potential treatment of non-healing diabetic foot ulcers. This profile would represent a dramatic change from current treatment approaches, which are often not predictably effective and which typically require multiple clinic visits, or in the case of a protein-based treatment, require daily wound cleanings and product applications over an extended period of time. The Company's Phase 2b MATRIX clinical study was initiated in November 2007 and is principally designed to evaluate the ability of Excellarate to promote rapid closure of previously non-healing diabetic foot ulcers and to gather additional information regarding safety and clinical use. Enrollment in the MATRIX clinical study is expected to be completed and select top line data announced shortly.
Consistent with Cardium's business strategy, the Company believes that with the Company's completion of the Phase 2b MATRIX study, the Tissue Repair Company will have reached a key valuation inflection point within Cardium's investment portfolio and in concert with this, Cardium plans to consider potential development and commercialization partnerships for Excellarate with large pharmaceutical companies and companies focused on wound healing. With continued clinical advancement, Excellarate offers the potential to be commercially available in late 2011 or early 2012.
Cardium also plans to explore additional clinical opportunities utilizing TRC's Gene Activated Matrix(TM) (GAM) technology platform. The Company's GAM technology has potential utility in additional indications in which protein therapeutics have had limited success, including the treatment of other dermal wounds (e.g., pressure ulcers) and with orthopedic products, including those for repair of damaged hard tissue (e.g., bone) and soft tissue (e.g., ligament, tendon and cartilage).
Biologics and Stem Cells for Cardiovascular Disease and Other Indications
Cardium has also developed additional biologics for potential application in cardiovascular disease and other areas of regenerative medicine. Generx(R) (alferminogene tadenovec, Ad5FGF-4) is designed to leverage the body's natural healing processes in response to repeated ischemic stress (insufficient blood flow and myocardial oxygen supply due to coronary heart disease) - for potential use in treating ischemic conditions such as recurrent angina. Corgentin(TM) (Ad5IGF-1) is designed to enhance myocardial healing in and around the infarct zone when used as an adjunct to existing vascular-directed pharmacologic and interventional therapies - for potential use in treating acute ischemic injury such as that following a heart attack.
A complementary approach to the development of therapeutics for regenerative medicine involves the use of stem cells that can be incorporated into injured tissue like the heart as a means of preventing further damage and promoting healing of the affected organ. In that regard, filings by Cardium related to Ad5IGF-1 also described the potential use of stem cells, such as mesenchymal stem cells or MSCs transfected with an Ad5IGF-1 vector (such as that used in Corgentin(TM)), for addressing coronary syndromes such as heart disease or heart attack.
With regard to stem cell approaches, recently reported studies conducted by independent researchers at the
For the quarter ended December 31, 2008, the Company reported a net loss of $5 million, or $(0.11) per share, which included research and development costs totaling $2 million and selling, general and administrative expenses of $2.6 million. For the year ended December 31, 2008, Cardium reported net operating losses totaling $24.6 million, or a loss of $(0.55) per share compared to $25.3 million, or $(0.64) per share in 2007. Research and development costs in 2008 were $12.3 million compared to $13.1 million for fiscal year 2007, and selling, general and administrative expenses were $11.6 million in 2008 compared to $12.1 million in 2007. The decrease in research and development costs was primarily due to a reduction in the development costs for InnerCool's RapidBlue system as it has moved from development to production, increased expenses in our efforts to advance our Excellarate product candidate in its Phase 2b clinical trial, offset by reductions in the AWARE Phase 3 clinical trial costs. Non-cash charges relating to stock-based compensation, depreciation and amortization for the year ended December 31, 2008 totaled $4.0 million compared to $3.5 million in 2007.
Total revenue for fourth quarter 2008 was $559,000 compared to $683,000 for fourth quarter 2007. Total revenue for the year ended December 31, 2008 was $2,417,000 compared to $1,587,000 for the previous year, representing a 52% year-over-year increase. The increase in 2008 product revenues was in large part a result of an increase in InnerCool sales resulting from the launch of the CoolBlue surface cooling system in late 2007 and the launch of the RapidBlue in late 2008. Cardium ended the year with cash and cash equivalents totaling $1.1 million compared to $7.7 million the previous year.
During 2008, the Company completed three follow-on registered direct investments by institutional and other accredited investors with gross proceeds totaling approximately $11.9 million, and the completion of a secured debt financing resulting in gross proceeds of approximately $6.0 million, before placement agent fees and offering expenses and excluding any future proceeds from the exercise of the warrants issued in the financings. On March 5, 2009, the Company reported closing a credit facility in the amount of $3.5 million, before placement agent fees and other expenses.
The total shares of common stock outstanding at December 31, 2008 were 46.9 million compared to 41.0 million at December 31, 2007.
Cardium also reported that the audit opinion accompanying its consolidated financial statements for the year ended December 31, 2008, which statements were included in its Annual Report on Form 10-K filed with the Securities and Exchange Commission in March 2009, contained a going concern qualification from its independent registered public accounting firm, Marcum & Kliegman LLP. Consistent with its business strategy and as outlined in this press release, Cardium plans to raise additional funds through the strategic sale or monetization of its operating units, entering into strategic licensing agreements, and/or other financing transactions.
This announcement is made in compliance with Section 610(b) of the Company Guide of the NYSE Amex (formerly the American Stock Exchange), which requires listed companies to make a public announcement of the receipt of an audit opinion that contains a going concern qualification. This announcement does not reflect any change or amendment to the consolidated financial statements as filed. More information about the going concern qualification is contained in Cardium's Annual Report on Form 10-K for the year ended December 31, 2008, which is available free of change on Cardium's website at www.cardiumthx.com.
In late December 2008, Cardium received notification from the staff of its current listing exchange indicating that the Company was considered to be noncompliant with certain listing requirements of the NYSE Amex. On January 23, 2009, the Company submitted a proposed plan outlining how it could establish compliance with the requirements of section 1003(a)(iv) by March 23, 2009, and establish compliance with all sections, including section 1003(a)(i), by June 23, 2010. Cardium received notification in late February that its plan had been accepted by the exchange, but remains subject to continuing review by the exchange with respect to the carrying out of its plan and the achievement and maintenance of overall compliance.
Cardium Therapeutics, Inc. and its subsidiaries, InnerCool Therapies, Inc. and the Tissue Repair Company, are medical technology companies primarily focused on the development, manufacture and sale of innovative therapeutic products and devices for cardiovascular, ischemic and related indications.
Cardium's InnerCool Therapies subsidiary is a San Diego-based medical technology company in the emerging field of temperature modulation therapy to rapidly and controllably cool the body in order to reduce cell death and damage following acute ischemic events such as cardiac arrest or stroke, and to potentially lessen or prevent associated injuries such as adverse neurological outcomes. For more information about Cardium's InnerCool subsidiary and patient temperature modulation, including InnerCool's new RapidBlue(TM) System, which recently received FDA clearance, and its CoolBlue(TM) System, please visit www.innercool.com.
Cardium also has two biologic candidates in clinical development. Cardium's Tissue Repair Company subsidiary (TRC) is focused on the development of growth factor therapeutics for the treatment of severe chronic diabetic wounds. TRC's lead product candidate, Excellarate(TM), is a DNA-activated collagen gel for topical treatment formulated with an adenovector delivery carrier encoding human platelet-derived growth factor-BB (PDGF-BB). Excellarate(TM) is initially being developed to be administered once or twice for the potential treatment of non-healing diabetic foot ulcers. Other potential applications for TRC's Gene Activated Matrix(TM) (GAM) technology include therapeutic angiogenesis (cardiovascular ischemia, peripheral arterial disease) and orthopedic products, including hard tissue (bone) and soft tissue (ligament, tendon, cartilage) repair. For more information about Cardium's Tissue Repair Company subsidiary, please visit www.t-r-co.com.
Cardium's Generx(R) product candidate (alferminogene tadenovec, Ad5FGF-4) is a DNA-based growth factor therapeutic designed for potential application by interventional cardiologists as a one-time treatment to promote and stimulate the growth of collateral circulation in the hearts of patients with ischemic conditions such as recurrent angina. For more information about Cardium Therapeutics and its businesses, products and therapeutic candidates, please visit www.cardiumthx.com or view its most recent Annual Report at http://www.cardiumthx.com/flash/pdf/CardiumAR07_Book_FINAL.pdf.
Except for statements of historical fact, the matters discussed in this press release are forward looking and reflect numerous assumptions and involve a variety of risks and uncertainties, many of which are beyond our control and may cause actual results to differ materially from stated expectations. For example, there can be no assurance that results or trends observed in pre-clinical studies will be reproduced in subsequent studies, that human clinical trials can be conducted and completed in an efficient and successful manner, that partnering, asset monetization or other strategic development opportunities can be successfully achieved and that such opportunities will effectively and efficiently advance commercialization of our products, that we can raise sufficient capital from partnering, monetization or other fundraising transactions to maintain our stock exchange listing or adequately fund ongoing operations, that product modifications or launches will be successful or that the resulting products will be favorably received in the marketplace, that results or trends observed in one clinical study will be reproduced in subsequent studies, that our products or product candidates will prove to be sufficiently safe and effective, that necessary regulatory approvals will be obtained, or that our products or product candidates will not be unfavorably compared to competitive products that may be regarded as safer, more effective, easier to use or less expensive. Actual results may also differ substantially from those described in or contemplated by this press release due to risks and uncertainties that exist in our operations and business environment, including, without limitation, risks and uncertainties that are inherent in the development of complex biologics and therapeutic hypothermia devices and in the conduct of human clinical trials, including the timing, costs and outcomes of such trials, our ability to obtain necessary funding, regulatory approvals and expected qualifications, our dependence upon proprietary technology, our history of operating losses and accumulated deficits, our reliance on collaborative relationships and critical personnel, and current and future competition, as well as other risks described from time to time in filings we make with the Securities and Exchange Commission. We undertake no obligation to release publicly the results of any revisions to these forward-looking statements to reflect events or circumstances arising after the date hereof.
Selected Consolidated Operational Results Annual Financial Data Three Months Ended Twelve Months Ended December 31, December 31, Statements of Operations Data: 2008 2007 2008 2007 Total Revenues $559,121 $683,386 $2,417,385 $1,586,519 Cost of goods sold (232,381) (524,659) (1,431,574) (1,348,335) Gross profit (loss) 326,740 158,727 985,811 238,184 Research and development 2,025,769 3,216,762 12,315,652 13,117,849 Selling, general and administrative 2,631,901 3,778,059 11,600,115 12,134,557 Amortization - Intangibles 197,414 197,414 789,656 789,656 Loss from operations (4,528,344) (7,033,508) (23,719,612) (25,803,878) Interest (expense) income, net (549,609) 20,737 (878,446) 482,108 Net loss (5,077,953) (7,012,771) (24,598,058) (25,321,770) Net loss per common share - basic and diluted $(0.11) $(0.16) $(0.55) $(0.64) Weighted average shares outstanding - basic and diluted 46,930,439 40,950,074 44,978,169 39,311,359 December 31, Selected Consolidated Balance Sheet Data 2008 2007 Cash and cash equivalents $1,102,894 $7,722,816 Accounts receivable, net 296,116 565,613 Inventory 2,000,385 1,037,164 Prepaid expenses and other current assets 642,246 522,067 Property and equipment, net 1,706,065 1,650,632 Patented technology and intangibles, net 3,976,674 4,766,330 Other long-term assets 572,541 661,067 Total assets 10,296,921 16,925,689 Total current liabilities 10,856,362 5,255,392 Long-term liabilities 195,315 3,241,992 Stockholder's (deficit) equity (754,756) 8,428,305 Total liabilities and stockholder's (deficit) equity 10,296,921 16,925,689
|SOURCE Cardium Therapeutics|
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