SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): April 30, 2001
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ADVANCED MAGNETICS, INC.
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(Exact Name of Registrant as Specified in Charter)
Delaware 0-14732 04-2742593
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(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
61 Mooney Street
Cambridge, MA 02138
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(Address of Principal (Zip Code)
Executive Offices)
Registrant's telephone number, including area code: (617) 497-2070
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ITEM 9. REGULATION FD DISCLOSURE
In accordance with general instruction B.2. of Form 8-K, the following
information is furnished and shall not be deemed filed for purposes of Section
18 of the Securities Exchange Act of 1934, as amended. The following information
shall not be deemed to be incorporated by reference by any general statement
incorporating by reference this Form 8-K into any filing under the Securities
Act of 1933, as amended, or any filing under the Securities Exchange Act of
1934, as amended, except to the extent that any such filing specifically
incorporates this information by reference, and will not otherwise be deemed
filed under either Act.
The following is the text of a letter distributed to shareholders of
the Company, dated April 30, 2001:
April 30, 2001
Dear Shareholder:
It is with great pleasure that we report to you that in the second
quarter ended March 31, 2001, your Company achieved profitability, earning
$557,604 or $0.08 per share during the quarter. For the six-month period, the
Company had earnings of $15,434 or $0.00 per share. Revenues in the second
quarter were $1,887,333, a more than 100% increase from the comparable period in
2000. Revenues increased as a result of a licensing agreement executed in the
fourth quarter of fiscal 2000 with Cytogen Corp. For complete comparable
results, please refer to the condensed income statements that are included in
this letter.
It should be noted that last year's figures have been adjusted to
reflect the Company's adoption of SEC Staff Accounting Bulletin No. 101 "Revenue
Recognition in Financial Statements" (SAB 101) in the first quarter of fiscal
2000. SAB 101 provides guidance from the Securities and Exchange Commission on
revenue recognition relating to upfront licensing fees.
In the current quarter, an Investigational New Drug (IND) submission
will be made to the Food and Drug Administration (FDA) for Code 7228 as an
intravenous iron therapeutic. The potential for Code 7228 in the treatment of
anemia is very exciting for the Company. The treatment of iron deficiency anemia
is a large and growing market, especially in kidney dialysis and cancer
patients, and we believe that Code 7228 could be a significant improvement over
currently used therapeutics. We anticipate a Phase II human trial could begin
before the end of the current quarter. The Phase II trial for Code 7228 as an
imaging agent in Magnetic Resonance Angiography began this last quarter and is
continuing. Preliminary imaging results have been very encouraging and we remain
optimistic about the safety profile of this product. The Company continues to
discuss with the FDA the steps that will be required to move Combidex(R) from
"approvable" to "approved". The agency is seeking additional clinical data and
the Company believes it has provided adequate data for approval. A resolution to
this impasse could come this quarter. Similar issues in Europe have delayed
Guerbet in its efforts to gain marketing approval for Sinerem(R) (COMBIDEX) and
additional clinical trials are contemplated in Europe.
The Supplemental New Drug Application (sNDA) for Feridex I.V.(R) submitted last
quarter is actively under review by the FDA at this time. A decision on the sNDA
is expected before the end of the year.
The Company's financial measures continue to be strong, with no debt,
and cash and securities at March 31, 2001 of almost $26 million. The Company has
successfully brought operating expenses into better balance with revenues so
they are now more appropriate to the current scope of Company activities. We
believe that the Company can continue to operate profitably going forward and it
is our intention to do so. The Company's stock buyback plan continues in place.
So far we have only been able to purchase 72,500 shares. Volume, timing and
statutory restrictions on our buyback activities continue to be obstacles in our
efforts, but the Company continues to actively attempt to buy back the full
million-share authorization.
On a personal note, we regret to inform you that Professor Joseph
Lassiter has resigned from the Board of Directors. Professor Lassiter's wise
counsel will be missed. We are pleased that we have been able to replace him
with Mr. Sheldon Bloch, the founder, President and CEO of Compucyte Corp., a
leading developer of laser cytometry diagnostic systems.
We hope to be able to report further positive developments to you in
future communications.
Sincerely,
Jerome Goldstein
Chairman and CEO
THIS DOCUMENT CONTAINS FORWARD-LOOKING STATEMENTS. ANY STATEMENTS CONTAINED IN
THIS LETTER THAT DO NOT DESCRIBE HISTORICAL FACTS ARE FORWARD-LOOKING STATEMENTS
THAT INVOLVE RISKS AND UNCERTAINTIES. THE FACTORS THAT COULD CAUSE ACTUAL
RESULTS TO DIFFER MATERIALLY FROM CURRENT EXPECTATIONS INCLUDE THE FOLLOWING:
THE TIMING OF THE COMPANY'S RECOGNITION OF DEFERRED REVENUE, WHICH IS AFFECTED
BY ITS PERFORMANCE OF ITS OBLIGATIONS UNDER ITS LICENSE AGREEMENTS;
UNCERTAINTIES REGARDING ACHIEVEMENT OF RECURRING PROFITABILITY, INCLUDING
INCREASING RECURRING PRODUCT REVENUES; DELAYS IN THE PREPARATION AND SUBMISSION
OF THE IND FOR CODE 7228; RESULTS OF CLINICAL TRIALS FOR CODE 7228 AS AN IRON
THERAPEUTIC AND FOR MAGNETIC RESONANCE ANGIOGRAPHY; TIMING AND RESULTS OF FDA
AND FOREIGN REGULATORY ACTIONS ON FILINGS FOR COMBIDEX, FERIDEX I.V.(R) AND
OTHER PRODUCTS; CONTINUATION OF COST REDUCTIONS RELATIVE TO REVENUE; AND OTHER
RISKS IDENTIFIED IN ADVANCED MAGNETICS, INC.'S SECURITIES AND EXCHANGE
COMMISSION FILINGS. THE COMPANY CAUTIONS READERS NOT TO PLACE UNDUE RELIANCE ON
ANY FORWARD-LOOKING STATEMENTS, WHICH SPEAK ONLY AS OF THE DATE THEY ARE MADE.
ADVANCED MAGNETICS DISCLAIMS ANY OBLIGATION TO PUBLICLY UPDATE OR REVISE ANY
SUCH STATEMENTS TO REFLECT ANY CHANGE IN EXPECTATIONS OR IN EVENTS, CONDITIONS
OR CIRCUMSTANCES ON WHICH ANY SUCH STATEMENTS MAY BE BASED, OR THAT MAY AFFECT
THE LIKELIHOOD THAT ACTUAL RESULTS WILL DIFFER FROM THOSE SET FORTH IN THE
FORWARD-LOOKING STATEMENTS.
ADVANCED MAGNETICS, INC.
CONDENSED INCOME STATEMENT FOR THE THREE-MONTH
AND SIX-MONTH PERIODS ENDED MARCH 31, 2001
(unaudited)
THREE MONTHS SIX MONTHS
ENDED MARCH 31, ENDED MARCH 31,
2001 2000 2001 2000
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Revenues $ 1,887,333 $ 869,020 $2,549,952 $1,463,000
Costs and expenses 1,329,729 1,727,659 2,534,518 3,569,385
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Income (loss) before cumulative
effect of accounting change 557,604 (858,639) 15,434 (2,106,385)
Cumulative effect of accounting
change --- --- --- (7,457,717)
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Net income (loss) $ 557,604 $ (858,639) $ 15,434 $(9,564,102)
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Basic and diluted income (loss)
per share $ 0.08 $ (0.13) $ 0.00 $ (1.42)
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Weighted average number of common
shares 6,725,657 6,752,027 6,746,346 6,752,027
Weighted average number of common
and common equivalent shares 6,725,657 6,752,027 6,746,346 6,752,027
BALANCE SHEET DATA
3/31/01 9/30/00
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Working capital $ 21,760,637 $ 25,706,905
Total assets $ 30,763,107 $ 35,667,591
Shareholders' equity $ 12,112,636 $ 14,305,633
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ADVANCED MAGNETICS, INC.
April 30, 2001 By /s/ Jerome Goldstein
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Jerome Goldstein
Chairman of the Board of Directors,
Chief Executive Officer and Treasurer