Exhibit 99.1
Cell Therapeutics, Inc. Making cancer more treatable
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501 Elliott Ave. W. #400 Seattle, WA 98119 | T 206.282.7100 F 206.272.4010 |
Cell Therapeutics, Inc. (CTI) Reports Recent Accomplishments
and 2007 Fourth Quarter and Year End Financial Results
Restructured majority of convertible notes due June 2008
Reduced net operating expenses going forward
Projects Zevalin® net sales revenues of $15 million in 2008
Mar. 13, 2008 Seattle—Cell Therapeutics, Inc. (CTI) (NASDAQ and MTA: CTIC) today reported recent accomplishments and financial results for the quarter and twelve months ended December 31, 2007.
Recent Events
• | Announced completion of Zevalin® (Ibritumomab Tiuxetan) acquisition from Biogen Idec for an upfront payment of $10.1 million and initiated building Zevalin sales, marketing, and medical affairs infrastructure |
• | Raised $14.8 million in aggregate gross proceeds through the issuance of common and preferred stock and warrants; raised $51.7 million in an offering of 9% Senior Convertible Notes due 2012; of which $16.2 million was used to induce the conversion of $21.5 million of outstanding Series A,B,C, and D convertible preferred securities to common stock |
• | Restructured approximately 81 percent of the convertible notes due in June 2008, reducing total due in 2008 from $55.9 million to $10.7 million |
• | Reduced expected net operating expenses by 35%, targeting $77 million in net cash operating expenses in 2008, by focusing resources on reaching $15 million in net Zevalin revenues, pursuing European marketing authorization (MAA) for XYOTAX (paclitaxel poliglumex, CT-2103), preparing for a potential U.S. marketing application (NDA) for pixantrone (BBR 2778) in 2009, and supporting the advancement of brostallicin |
“Now that we have made significant progress on our strategy of simplifying our capital structure, reducing operating expenses, and shifting our resources to near-term opportunities, we believe we are in a much stronger position to increase revenues, execute our late-stage clinical programs, and create value for our shareholders and patients,” said James A. Bianco, M.D., President and CEO of CTI. “With our financial restructuring and strategic realignment completed, we can focus on commercializing Zevalin and developing our late-stage product pipeline.”
www.cticseattle.com
Page 2 of 4 | CTI fourth quarter/year end 2007 financial results |
Financial Results
For the quarter ended December 31, 2007, CTI reported a net loss attributable to common shareholders of $39.1 million ($0.74 per share) compared to a net loss attributable to common shareholders of $35.6 million ($1.00 per share) for the same period in 2006.
For the year ended December 31, 2007, CTI posted a net loss attributable to common shareholders of $148.3 million ($3.27 per share), which includes $24.6 million in acquired in-process research and development expense associated with the acquisitions of Systems Medicine and Zevalin. The acquired in-process research and development charge is primarily a non-cash expense. This compares to a net loss attributable to common shareholders of $135.8 million ($4.84 per share) for the same period in 2006. In 2007, CTI recorded make-whole interest expense of $2.3 million compared to $24.8 million in 2006, which was primarily related to conversions of our 63/4% convertible notes during 2006.
The Company ended the year with cash and cash equivalents, securities available-for-sale and interest receivable of approximately $18.4 million. In January 2008, CTI sold shares to Société Générale, pursuant to the Step-Up Equity Financing Agreement, for gross proceeds of approximately $1.27 million. In March 2008, CTI raised approximately $35.5 million in gross proceeds from the sale of convertible senior notes after taking into consideration $16.2 million paid as a conversion inducement to preferred securities holders, which eliminated $21.5 million of redeemable preferred stock.
About Cell Therapeutics, Inc.
Headquartered in Seattle, CTI is a biopharmaceutical company committed to developing an integrated portfolio of oncology products aimed at making cancer more treatable. For additional information, please visitwww.cticseattle.com.
This press release includes forward-looking statements that involve a number of risks and uncertainties, the outcome of which could materially and/or adversely affect actual future results. Specifically, the risks and uncertainties include statements about future sales of Zevalin, reducing net operating expenses in 2008, and the development of XYOTAX, pixantrone, and brostallicin, which include risks associated with preclinical and clinical developments in the biopharmaceutical industry in general and with XYOTAX, pixantrone, and brostallicin in particular, including, without limitation, the potential failure of these product candidates to prove safe and effective for treatment of non-small cell lung cancer, ovarian cancer, non-Hodgkin’s lymphoma, and sarcoma, determinations by regulatory, patent and administrative governmental authorities, competitive factors, technological developments, costs of developing, producing and selling Zevalin, XYOTAX, pixantrone, and brostallicin, the Company’s ability to continue to raise capital as needed to fund its operations, and the risk factors listed or described from time to time in the Company’s filings with the Securities and Exchange Commission including, without limitation, the Company’s most recent filings on Forms 10-K, 8-K, and 10-Q. Except as may be required by Italian law, CTI does not intent to update or alter its forward-looking statements whether as a result of new information, future events, or otherwise.
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www.cticseattle.com
Page 3 of 4 | CTI fourth quarter/year end 2007 financial results |
Media Contact:
Dan Eramian
T: 206.272.4343
C: 206.854.1200
Susan Callahan
T: 206.272.4472
F: 206.272.4434
E: media@ctiseattle.com
www.cticseattle.com/media.htm
Investors Contact:
Leah Grant
T: 206.282.7100
F: 206.272.4434
E: invest@ctiseattle.com
www.cticseattle.com/investors.htm
www.cticseattle.com
Page 4 of 4 | Cell Therapeutics, Inc. |
Consolidated Statements of Operations
(In thousands, except for per share amounts)
(unaudited)
Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||
2007 | 2006 | 2007 | 2006 | |||||||||||||
Revenues: | ||||||||||||||||
Product sales | 47 | — | 47 | — | ||||||||||||
License and contract revenue | 20 | 20 | 80 | 80 | ||||||||||||
Total revenues | 67 | 20 | 127 | 80 | ||||||||||||
Operating expenses: | ||||||||||||||||
Cost of product sold | 49 | — | 49 | — | ||||||||||||
Research and development | 21,651 | 16,623 | 72,019 | 61,994 | ||||||||||||
Selling, general and administrative | 10,923 | 8,075 | 35,517 | 35,894 | ||||||||||||
Acquired in-process research and development | 3,272 | — | 24,615 | — | ||||||||||||
Amortization of purchased intangibles | 275 | 204 | 913 | 792 | ||||||||||||
Total operating expenses | 36,170 | 24,902 | 133,113 | 98,680 | ||||||||||||
Loss from operations | (36,103 | ) | (24,882 | ) | (132,986 | ) | (98,600 | ) | ||||||||
Other income (expense): | ||||||||||||||||
Investment and other income | 363 | 1,023 | 2,430 | 2,866 | ||||||||||||
Interest expense | (2,460 | ) | (2,941 | ) | (12,517 | ) | (19,829 | ) | ||||||||
Foreign exchange gain | 1,515 | 880 | 4,657 | 1,877 | ||||||||||||
Make-whole interest expense | — | — | (2,310 | ) | (24,753 | ) | ||||||||||
Gain on derivative liabilities | 54 | 820 | 3,672 | 6,024 | ||||||||||||
Gain (loss) on exchange of convertible notes | (972 | ) | — | (972 | ) | 7,978 | ||||||||||
Settlement expense | — | (10,499 | ) | (160 | ) | (11,382 | ) | |||||||||
Net loss before minority interest | (37,603 | ) | (35,599 | ) | (138,186 | ) | (135,819 | ) | ||||||||
Minority interest in net loss of subsidiary | 42 | — | 78 | — | ||||||||||||
Net loss | (37,561 | ) | (35,599 | ) | (138,108 | ) | (135,819 | ) | ||||||||
Preferred stock beneficial conversion feature | (1,248 | ) | — | (9,549 | ) | — | ||||||||||
Preferred stock dividends | (253 | ) | — | (648 | ) | — | ||||||||||
Net loss attributable to common shareholders | $ | (39,062 | ) | $ | (35,599 | ) | $ | (148,305 | ) | $ | (135,819 | ) | ||||
Basic and diluted net loss per common share | $ | (0.74 | ) | $ | (1.00 | ) | $ | (3.27 | ) | $ | (4.84 | ) | ||||
Shares used in calculation of basic and diluted net loss per common share (1) | 52,469 | 35,601 | 45,292 | 28,070 | ||||||||||||
(amounts in thousands) | ||||||||
December 31, | ||||||||
2007 | 2006 | |||||||
(unaudited) | ||||||||
Balance Sheet Data: | ||||||||
Cash and cash equivalents, securities available-for-sale and interest receivable | $ | 18,392 | $ | 54,407 | ||||
Working capital | (30,909 | ) | 30,166 | |||||
Total assets | 73,513 | 101,821 | ||||||
Convertible debt | 137,396 | 166,178 | ||||||
Accumulated deficit | (1,109,413 | ) | (961,108 | ) | ||||
Shareholders’ deficit | (134,125 | ) | (101,604 | ) |
(1) | Amounts reflect a one-for-four reverse stock split of our common stock effective April 15, 2007. |