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[CELTRIX LOGO AND LETTERHEAD]
NEWS RELEASE
CONTACT: Mary Anne Ribi
Vice President and Chief Financial Officer
(408) 988-2500
CELTRIX REPORTS FISCAL YEAR-END
FINANCIAL RESULTS
Significant Achievements in Clinical Development and Manufacturing
SANTA CLARA, CA -- May 14, 1997 -- For the fiscal year ended March 31,
1997, Celtrix Pharmaceuticals, Inc. (Nasdaq: CTRX) reported revenues of $658,000
and a net loss of $12,696,000, or $0.83 per share. Operating expenses increased
6 percent to $13,818,000, due primarily to costs associated with human clinical
studies and the manufacture of SomatoKine(R), the company's novel IGF-BP3
therapeutic composition.
In comparison, revenues for the fiscal year ended March 31, 1996, were
$1,750,000, due primarily to the sale of the company's Vitrogen(R) 100 Collagen
business, receipts from an Orphan Drug Grant, and reimbursement from Genzyme
Corporation for development work on TGF-beta-2. Operating expenses were
$13,084,000 for the fiscal year ended March 31, 1996, and the net loss was
$7,246,000, or $0.51 per share, which included a $3,463,000 gain on investment
from the sale of Metra Biosystems securities held by Celtrix since 1990.
At March 31, 1997, Celtrix had $5,788,000 in cash and investment
balances. In April 1997, Celtrix raised an additional $13,950,000 in gross
proceeds from a private equity placement. Along with year-end cash and
investments, proceeds from this financing should be sufficient to fund Celtrix's
operations through mid-1998.
Clinical and Manufacturing Progress
"Fiscal 1997 was a year of achievements for Celtrix in clinical
development and product manufacturing," said Andreas Sommer, Ph.D., Celtrix's
president and chief executive officer. "We conducted three Phase I human
clinical studies of SomatoKine demonstrating significant safety and initial
efficacy. Based on these results, we initiated Phase II feasibility studies for
the treatment of hip fracture surgery, and by mid-1997, we expect to begin Phase
II feasibility studies for the treatment of severe burns. Clinical findings from
the hip fracture study will guide expansion into a full Phase II clinical study
planned for later this fiscal year. These findings also will guide the possible
initiation of clinical studies to treat severe osteoporosis."
"In other company activities, we scaled up our manufacturing process during
the fiscal year, building sufficient SomatoKine inventory to accommodate Phase
II clinical feasibility studies," Dr. Sommer said. "In addition, Celtrix
received three additional U.S. patents, further protecting our technology and
product applications."
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"Celtrix Reports Fiscal Year-End Financial Results"
Page 2
Celtrix is a biopharmaceutical company developing novel therapeutics
for the treatment of seriously debilitating, degenerative conditions primarily
associated with severe trauma, chronic diseases or aging. The company's focus is
on SomatoKine, a novel IGF-BP3 complex, for use in regenerating lost muscle,
bone and other tissues essential for the patient's health and quality of life.
Initial product development programs target acute traumatic injury, such as hip
fracture surgery in the elderly, and severe burns. Other potential indications
include severe osteoporosis and protein wasting diseases associated with cancer,
AIDS and other life-threatening conditions. Through strategic alliances with
Celtrix, The Green Cross Corporation is developing SomatoKine for the treatment
of osteoporosis in Japan, and Genzyme Corporation is developing TGF-beta-2 as
part of a comprehensive approach to tissue repair and the treatment of systemic
disease.
This news release contains certain forward-looking statements within
the meaning of Section 21E of the Securities Exchange Act of 1934, as amended.
Actual results may differ materially from the statements made, as a result of
various factors, including risks associated with future company research,
clinical study results, the regulatory approval process, competitive products
and other factors which are listed from time to time in Celtrix's Securities and
Exchange Commission (SEC) filings. These forward-looking statements represent
Celtrix's judgment as of the date of this news release.
- FINANCIAL CHARTS FOLLOW -
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CELTRIX PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
March 31, March 31,
1997 1996
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ASSETS
Current assets:
Cash, cash equivalents and short-term investments $5,268 (1) $17,593
Restricted cash 520 50
Receivables and other current assets 197 195
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Total current assets 5,985 17,838
Property and equipment, net 8,423 10,013
Intangible and other assets, net 2,548 2,294
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$16,956 $30,145
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 1,380 $ 1,301
Current portion of long-term obligations 328 633
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Total current liabilities 1,708 1,934
Deferred rent 1,038 1,187
Long-term obligations - 238
Stockholders' equity 14,210 26,786
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$16,956 $30,145
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(1) The Company completed a private placement of 5.7 million shares of
common stock at $2.438 per share in April 1997. The net proceeds to
the Company were $13.3 million. The following unaudited pro forma
financial data gives effect as of March 31, 1997 to this financing:
Cash, cash equivalents, restricted cash, and short-term investment $19,088
Stockholders' equity $27,510
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CELTRIX PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
Three Months Ended Year Ended
March 31, March 31,
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1997 1996 1997 1996
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Revenues:
Product sales $ 11 $ 11 $ 31 $ 99
Other revenues 539 722 627 1,651
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550 733 658 1,750
Costs and expenses:
Cost of sales 1 2 5 31
Research and development 3,011 2,935 11,999 10,990
General and administrative 506 455 1,814 2,063
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3,518 3,392 13,818 13,084
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Operating loss (2,968) (2,659) (13,160) (11,334)
Interest income, net 65 178 464 625
Gain on investment - 1,144 - 3,463
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Net loss $ (2,903) $ (1,337) $(12,696) $ (7,246)
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Net loss per share $ (0.19) $ (0.09) $ (0.83) $ (0.51)
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Shares used in computing net loss per share 15,263 15,214 15,238 14,161
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