Exhibit 99.1
FOR IMMEDIATE RELEASE
GENOME THERAPEUTICS REPORTS FINANCIAL RESULTS
- Results for 3-month and 12-month periods ended August 31, 2001 -
- Transition to new 12/31 fiscal reporting schedule;
Third quarter results also announced -
WALTHAM, MASS., NOVEMBER 8, 2001 -- Genome Therapeutics Corp. (Nasdaq: GENE)
today announced financial results for the 3-month and 12-month periods ended
August 31, 2001. In addition, the Company's Board of Directors approved in July
a change in the reporting schedule from an August 31 year end to a December 31
year end. Reflecting this change in fiscal reporting schedule, financial results
for the third quarter ended September 29, 2001 are also noted below. To provide
additional disclosure during this transition, three pages of financial tables
are included at the end of this news release.
For the 3-month period ended August 31, 2001, total revenues were $12,592,000
compared to $6,106,000 in the same period of 2000. Net income for the 3-month
period ended August 31, 2001 was $703,000, or $0.03 per share (basic and
diluted), compared to a net loss of ($1,732,000), or ($.08) per share (basic and
diluted), for the same period in 2000.
For the 12-month period ended August 31, 2001, the Company reported total
revenues of $32,806,000 compared to $26,424,000 during the same 12-month-period
in 2000. Net loss in this 12-month period in 2001 was ($3,969,000), or ($0.18)
per share (basic and diluted), compared to a net loss of ($2,816,000), or
($0.14) per share (basic and diluted), in fiscal 2000. The Company's cash and
cash equivalents, restricted cash and investments totaled approximately $74.0
million at August 31, 2001.
Management noted that results for the 3-month period ended August 31, 2001
reflect confirmation of the identity of a novel gene responsible for high bone
density in the Company's osteoporosis alliance with Wyeth-Ayerst, that resulted
in receipt of $5 million in milestone payments. Moving forward, management
expects to continue to report operating losses as the Company makes additional
investments in internal discovery and product development opportunities.
"Our positive financial results reflect the revenue contributions from a major
achievement in our osteoporosis alliance and the sponsored research from our
established portfolio of product discovery research alliances with
pharmaceutical companies. They also reflect continued progress in
GenomeVision(TM) Services - our commercial genomics service business," said
Steven M. Rauscher, CEO and President. "This foundation allows us to invest in
new product opportunities with potentially higher rewards to shareholders,
namely our anti-infectives drug discovery collaboration with ArQule and the
in-license of products for Genome Therapeutics.
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"The recent acquisition of the Phase III anti-infective Ramoplanin has helped
the Company achieve an important step toward building our product-based
biopharmaceutical business with a clinical candidate pipeline of our own," added
Mr. Rauscher. "In acquiring the rights to Ramoplanin, we are able to capitalize
on the Company's established expertise in infectious disease research and apply
it to a near-term commercial opportunity. To facilitate attaining our goals, we
have made several key hires in the areas of corporate development, marketing and
clinical development."
OTHER HIGHLIGHTS INCLUDE:
o Confirmation of the identity of a novel gene responsible for high bone
density and $5 million milestone payment from Wyeth-Ayerst
o Election of David K. Stone, a partner with AGTC Funds and former Cowen
& Co. analyst, to Board of Directors
o Extension of osteoporosis alliance with Wyeth-Ayerst through the end
of 2002
o Renewal of PathoGenome(TM) Database subscriptions by Bristol-Myers
Squibb and Aventis
o Identification of novel asthma gene in Schering-Plough alliance
o Participation in completion of Human Genome Project draft sequence and
publication in NATURE
TRANSITION TO FISCAL CALENDAR YEAR ENDED DECEMBER 31: REPORTING RESULTS FOR Q3
"In order to facilitate financial modeling and comparisons with other
biotechnology companies by the financial community, the Company has implemented
a change to a December 31 fiscal year so that we will be on similar cycles to
our pharmaceutical alliance partners and companies in our peer group," said Mr.
Rauscher.
For the third quarter of 2001, which ended September 29, 2001, the Company
reported total revenues of $7,378,000 and a net loss of ($4,181,000), or
approximately ($0.18) per share (basic and diluted). In the same period of 2000,
the Company reported revenues of $5,925,000, and a net loss of ($1,322,000), or
approximately ($0.06) per share (basic and diluted).
For the first nine months of 2001, the Company reported total revenues of
$26,858,000, compared to $19,109,000 during the same period of 2000. Net loss in
the first nine months of 2001 was ($2,150,000), or ($0.10) per share, compared
to a net loss of ($3,439,000), or ($0.16) per share, in the same period of 2000.
The Company's cash, cash equivalents and other investments at the end of the
third quarter of 2001 were approximately $72.5 million.
Management noted that these results reflect a steady growth in our service
business and the achievement of significant scientific and financial milestones.
Costs and expenses also increased, compared to the prior year period, as the
company expanded funding of internal research and development programs and
recruited key personnel to lead the company's product development efforts. The
Company will host an annual meeting of shareholders in the Spring 2002 and
details about the date and location will be included in an annual report and
proxy mailed prior to the meeting.
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SUPPLEMENTARY FINANCIAL INFORMATION
STATEMENTS IN THIS PRESS RELEASE THAT ARE NOT STRICTLY HISTORICAL, INCLUDING
STATEMENTS REGARDING FUTURE REVENUES AND EXPENSES, ARE "FORWARD LOOKING"
STATEMENTS AS DEFINED IN THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. A
NUMBER OF IMPORTANT FACTORS COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM
THOSE PROJECTED OR SUGGESTED IN THE FORWARD LOOKING STATEMENT, INCLUDING, BUT
NOT LIMITED TO, THE ABILITY OF THE COMPANY AND ITS ALLIANCE PARTNERS TO (I)
SUCCESSFULLY DEVELOP PRODUCTS BASED ON THE COMPANY'S GENOMIC INFORMATION, (II)
OBTAIN THE NECESSARY GOVERNMENTAL APPROVALS, (III) EFFECTIVELY COMMERCIALIZE ANY
PRODUCTS DEVELOPED BEFORE ITS COMPETITORS AND (IV) OBTAIN AND ENFORCE
INTELLECTUAL PROPERTY RIGHTS, AS WELL AS THE RISK FACTORS DESCRIBED IN EXHIBIT
99 OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED AUGUST
31, 2000 AND FROM TIME TO TIME IN THE COMPANY'S OTHER REPORTS FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION.
FOR THE YEAR ENDING DECEMBER 31, 2001, GENOME THERAPEUTICS MANAGEMENT EXPECTS:
- Revenues projected to be in the range of $33-37 million
- Total costs and expenses projected to be in the range of $45-50
million, reflecting the increased expense attributable to license fees
and development costs associated with Ramoplanin
Genome Therapeutics (www.genomecorp.com) is focused on the commercialization of
genomics-based pharmaceutical and diagnostic products. The Company's genomics
services business - GenomeVision(TM) Services - includes custom contract
sequencing, SNP discovery and the PathoGenome(TM) Database. The Company's
biopharmaceutical business focuses on the development of novel therapeutics and
diagnostics to solve major medical needs and includes six alliances with
pharmaceutical companies including Schering-Plough, AstraZeneca, Wyeth-Ayerst
and bioMerieux, to develop genomics-based products and a joint venture with
ArQule. Genome Therapeutics' product candidate, Ramoplanin, is in Phase III
clinical trials for the prevention of bloodstream infections caused by
vancomycin- resistant enterococci (VRE).
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FINANCIAL RESULTS FOR PERIODS ENDED AUGUST 31, 2001
GENOME THERAPEUTICS CORP.
STATEMENTS OF OPERATIONS
(unaudited) (in thousands, except share and per share amounts)
Thirteen weeks ended Fifty-two weeks ended
August 31, August 31, August 31, August 31,
2001 2000 2001 2000
---- ---- ---- ----
REVENUE:
Contract research, licenses, milestones and
subscription fees $12,592 $6,106 $ 32,806 $ 26,424
------- ----- -------- ------
COSTS AND EXPENSES:
Research and development 9,676 6,778 32,085 24,821
Selling, general and administrative 2,992 1,807 8,307 5,818
----- ----- ----- -------
Total costs and expenses 12,668 8,585 40,392 30,639
------- ----- -------- ------
Loss from operations (76) (2,479) (7,586) (4,215)
Interest income 995 957 4,422 2,226
Interest expense (216) (210) (805) (827)
---------- ---------- ---------- ----------
NET INCOME (LOSS) $703 $(1,732) $(3,969) $(2,816)
==== ======== ======== ========
Net income (loss) per common share
Basic $0.03 $(0.08) $(0.18) $(0.14)
===== ======= ======= =======
Diluted $0.03 $(0.08) $(0.18) $(0.14)
===== ======= ======= =======
Weighted average number of common shares
outstanding
Basic 22,611,608 21,710,257 22,420,139 20,277,076
========== ========== ========== ==========
Diluted 23,885,705 21,710,257 22,420,139 20,277,076
========== ========== ========== ==========
SELECTED BALANCE SHEET DATA
(in thousands) (unaudited)
AUGUST 31, AUGUST 31,
---------- ----------
2001 2000
---- ----
Cash, cash equivalents, restricted cash and $74,008 $75,884
investments
Total assets 90,008 91,336
Long-term obligations, net of current maturities 2,420 4,543
Shareholders' equity 74,395 74,275
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NEW FISCAL REPORTING SCHEDULE
THIRD QUARTER RESULTS, SEPTEMBER 29, 2001
GENOME THERAPEUTICS CORP.
STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
(unaudited)
Thirteen weeks ended Thirty-nine weeks ended
Sept 29, Sept 23, Sept 29, Sept 23,
2001 2000 2001 2000
---- ---- ---- ----
REVENUE:
Contract research, licenses, milestones and
subscription fees $7,378 $5,925 $26,858 $19,109
------ ----- ------ ------
COSTS AND EXPENSES:
Research and development 9,881 6,505 25,254 19,276
Selling, general and administrative 2,559 1,712 6,384 4,745
----- ----- ----- -----
Total costs and expenses 12,440 8,217 31,638 24,021
----- ----- ----- -----
Loss from operations (5,062) (2,292) (4,780) (4,912)
Interest income 1,055 1,180 3,186 2,100
Interest expense (174) (210) (556) (627)
----- ----- ----- -----
NET LOSS $(4,181) $(1,322) $(2,150) $(3,439)
======== ======== ======== ========
Net Loss per Common Share
Basic $(0.18) $(0.06) $(0.10) $(0.16)
======= ======= ======= =======
Diluted $(0.18) $(0.06) $(0.10) $(0.16)
======= ======= ======= =======
Weighted average number of common shares
outstanding
Basic 22,685,660 22,163,366 22,515,638 21,030,081
========== ========== ========== ==========
Diluted 22,685,660 22,163,366 22,515,638 21,030,081
========== ========== ========== ==========
SELECTED BALANCE SHEET DATA
(in thousands) (unaudited)
September 29, December 31,
2001 2000
---- ----
Cash, cash equivalents, restricted cash and investments $72,525 $73,010
Total assets 87,957 90,251
Long-term obligations, net of current maturities 2,588 3,334
Shareholders' equity 73,653 72,687
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NEW FISCAL REPORTING SCHEDULE
Q1-Q3 RESULTS
GENOME THERAPEUTICS CORP.
STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
(unaudited)
Thirteen weeks ended Thirty-nine
---------------- ---------------- ----------------- weeks ended
March 24, June 23, Sept 29, Sept 29,
2001 2001 2001 2001
---------------- ---------------- ----------------- ----
REVENUE:
Contract research, licenses, milestones and
subscription fees $8,090 $11,390 $7,378 $26,858
------ ------ ----- ------
COSTS AND EXPENSES:
Research and development 7,503 7,870 9,881 25,254
Selling, general and administrative 1,635 2,190 2,559 6,384
----- ----- ----- -----
Total costs and expenses 9,138 10,060 12,440 31,638
----- ----- ----- -----
Income (loss) from operations (1,048) 1,330 (5,062) (4,780)
Interest income 1,144 986 1,055 3,186
Interest expense (169) (212) (174) (556)
----- ----- ----- -----
NET INCOME (LOSS) $(73) $2,104 $(4,181) $(2,150)
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Net income (loss) per common share
Basic $(0.00) $0.09 $(0.18) $(0.10)
======= ===== ======= =======
Diluted $(0.00) $0.09 $(0.18) $(0.10)
======= ===== ======= =======
Weighted average number of common shares
outstanding
Basic 22,409,501 22,451,753 22,685,660 22,515,638
========== ========== ========== ==========
Diluted 22,409,501 23,550,563 22,685,660 22,515,638
========== ========== ========== ==========
SELECTED BALANCE SHEET DATA
(in thousands) (unaudited)
March 24, June 23, September 29,
2001 2001 2001
---- ---- ----
Cash, cash equivalents, restricted cash and $70,377 $76,195 $72,524
investments
Total assets 89,165 91,483 87,957
Long-term obligations, net of current 3,452 2,906 2,588
maturities
Shareholders' equity 73,235 75,634 73,653
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