Exhibit 99.1
( BW)(CA-SCICLONE)(SCLN) SciClone Reports Third Quarter Results; Sales
of ZADAXIN Increase 26% to $5.4 Million
Business Editors
BIOWIRE2K
SAN MATEO, Calif.--(BUSINESS WIRE)--Oct. 27, 2003--SciClone
Pharmaceuticals, Inc. (NASDAQ:SCLN) today reported results for the
third quarter ended September 30, 2003. Revenues from sales of
ZADAXIN(R), the company's lead immune system enhancer drug, were
$5,421,000 for the third quarter of 2003, a 26% increase over the
$4,298,000 reported for the third quarter 2002. Net loss was
$2,850,000, or $0.07 per share, for the third quarter 2003 compared to
$1,672,000, or $0.05 per share, for the third quarter of 2002. During
the third quarters of 2002 and 2003, the company recognized $224,000
as contract revenue from its European marketing partner, Sigma-Tau.
"We reported important achievements during the third quarter,"
commented Donald R. Sellers, SciClone's President and Chief Executive
Officer. "In September we completed full enrollment of the first of
our two 500 patient U.S. phase 3 trials and raised net proceeds of $45
million through a public offering of common stock. Separately, today
we reported positive 12-week data from our first triple therapy
hepatitis C pilot study also targeting the re-treatment of
non-responders."
Richard A. Waldron, SciClone's Chief Financial Officer, added,
"Our cash position of $66 million at the end of the quarter ensures
more than sufficient funds to complete our two ongoing 500 patient
phase 3 hepatitis C clinical trials for ZADAXIN while continuing to
retain full commercial rights in the U.S. Our current funding also
allows us to develop new delivery technologies for ZADAXIN to enhance
its use and strengthen our proprietary position. The incremental funds
may also provide opportunities to develop other products in our
pipeline as well as examine new product candidates."
For the nine months ended September 30, 2003, revenues from
ZADAXIN sales totaled $26,628,000, a 117% increase over the
$12,294,000 reported for the same period of the prior year. The growth
in sales during the first nine months of 2003 was largely a result of
an unanticipated temporary increase in sales of ZADAXIN to hospitals
in China during the second quarter of 2003. This increase was related
to the use of immune system enhancers in connection with the treatment
of severe acute respiratory syndrome, or SARS. As this SARS epidemic
has been contained, SciClone expects sales in future quarters will be
consistent with sales patterns in the first and third quarter of 2003.
Net loss for the nine months ended September 30, 2003 was $588,000, or
$0.02 per share, versus a net loss of $7,420,000, or $0.22 per share,
during the same period of the prior year.
Cash, cash equivalents, and short-term investments totaled
$66,256,000 at September 30, 2003, compared to $26,372,000 at June 30,
2003 and $24,506,000 at September 30, 2002. The increase from June 30,
2003 was attributable to net proceeds of $45 million from SciClone's
public offering of 6 million shares of common stock in September 2003.
Other recent developments at SciClone include:
-- Today, SciClone reported positive data from a triple therapy
pilot study showing ZADAXIN in combination with pegylated
interferon alpha and ribavirin produced a 12-week early
virologic response (EVR) in 61% of hepatitis C non-responder
patients who had failed to respond to prior therapy of
interferon in combination with ribavirin. By comparison,
separate recent studies show that pegylated interferon alpha
plus ribavirin produce an EVR in approximately 15-21% of
non-responders and a sustained viral response (SVR) in only
approximately 10% of such patients. A patient's EVR is
considered necessary to achieve a sustained response, but
evidence shows that a patient who demonstrates an EVR may or
may not achieve a SVR, and therefore EVR may not be predictive
of a successful outcome, especially for a non-responder. SVR
is the absence of hepatitis C virus measured six months after
ending therapy. These interim results were presented at the
largest meeting of liver specialists in the world, the annual
meeting of the American Association of the Study of Liver
Disease (AASLD). This ongoing triple therapy study plans to
enroll a total of 50 hepatitis C non-responder patients in 5
sites throughout Mexico. None of the patients in this study
have responded to prior therapy of interferon in combination
with ribavirin. During the course of this study, patients will
receive 12 months of triple therapy and will be observed for 6
months after completing therapy to measure sustained response.
-- In October, SciClone and its collaborator were awarded an
$840,000 grant from Initiatives for Proliferation Prevention,
a program offered by the U.S. Department of Energy to support
cooperative scientific developments in the former Soviet
Union. The grant is to further develop SCV-07, SciClone's
proprietary compound that enhances the immune system.
SciClone's collaborator, Verta Ltd., a biotechnology company
in St. Petersburg, Russia, will develop an oral formulation
for SCV-07 and conduct phase 2 tuberculosis (TB) clinical
trials in Russia, where the TB mortality rate is among the
highest in Europe. In previous phase 2 clinical trials, SCV-07
formulated as an injectable product showed the capability to
significantly increase the rate at which treated TB patients
become noncontagious, one of the main goals in treating TB.
-- In September, SciClone announced that it completed enrollment
of the first of two 500 patient phase 3 hepatitis C clinical
trials. SciClone expects to complete enrollment of its second
phase 3 hepatitis C clinical trial by the end of the first
quarter of 2004. The trials are designed to evaluate whether
ZADAXIN in combination with pegylated interferon is effective
in treating hepatitis C patients who have failed to respond to
current therapy. SciClone's objective is to have ZADAXIN in
combination with pegylated interferon alpha become the first
FDA approved therapy specifically for the treatment of
non-responders.
-- In September, SciClone sold 6 million shares of common stock
in a public offering for net proceeds of $45 million,
resulting in 44,362,567 shares outstanding at September 30,
2003.
SciClone management will host a live audio webcast and conference
call at 2:30 pm EST (11:30 am PST) today, Monday, October 27, 2003.
The conference call will include forward looking statements. Financial
information to be discussed in the conference call will be posted on
the newsroom section of SciClone's web site at http://www.sciclone.com
prior to the commencement of the conference call. To participate in
the conference call, please log-on at http://www.sciclone.com or call
800-901-5213 (U.S./Canada) or 617-786-2962 (international) and enter
passcode 68221313. A replay will be available for two weeks. To access
the replay, log on to http://www.sciclone.com or dial 888-286-8010
(U.S./Canada) or 617-801-6888 (international) and enter passcode
21942585.
About SciClone
SciClone Pharmaceuticals is a biopharmaceutical company engaged in
the development of therapeutics to treat life-threatening diseases.
SciClone is currently evaluating its lead product ZADAXIN in several
late stage clinical trials, including two phase 3 hepatitis C clinical
trials in the U.S., a recently completed phase 3 hepatitis B clinical
trial in Japan, a phase 2 malignant melanoma clinical trial in Europe,
two phase 2 liver cancer pilot studies in the U.S., and a hepatitis C
triple therapy pilot study in Mexico. Other drug development
candidates include SCV-07, a potentially orally available therapeutic
to treat viral and infectious diseases, and other products to treat
cystic fibrosis. For more information about SciClone, visit
www.sciclone.com.
The information in this press release contains forward-looking
statements including our expectations and beliefs regarding the timing
and completion of enrollment for our second phase 3 hepatitis C
clinical trial, sales of ZADAXIN in future quarters, and the fact that
the experimental or clinical data described may imply certain actual
results in larger patient populations. Words such as "expects,"
"plans," "believe," "may," "will," "anticipated," "intended" and
variations of these words or similar expressions are intended to
identify forward-looking statements. In addition, any statements that
refer to expectations, goals, projections or other characterizations
of future events or circumstances, including any underlying
assumptions, are forward-looking statements. These statements are not
guarantees of future performance and are subject to risks,
uncertainties and assumptions that are difficult to predict.
Therefore, our actual results could differ materially and adversely
from those expressed in any forward-looking statements as a result of
various factors, including the speed with which patients are enrolled
in our second hepatitis C clinical trial, unexpected delays in
preparation for enrollment and enrollment of patients, our ability to
enroll a sufficient number of eligible patients to yield statistically
significant results, maintenance of the sufficiency and eligibility of
enrolled patient population, unexpected adverse results to patients
during our trials and programs, changes in demand for ZADAXIN, the
course of the SARS epidemic, the progress or failure of clinical
trials and the fact that experimental data and clinical results
derived from studies with a limited group of patients may not be
predictive of the results of larger studies, as well as other risks
and uncertainties described in SciClone's filings with the Securities
and Exchange Commission.
SCICLONE PHARMACEUTICALS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Three Months Three Months Nine Months Nine Months
Ended Ended Ended Ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
2003 2002 2003 2002
------------ ------------ ------------ ------------
Product sales $5,421,000 $4,298,000 $26,628,000 $12,294,000
Contract revenue 224,000 224,000 672,000 448,000
------------ ------------ ------------ ------------
Total revenue 5,645,000 4,522,000 27,300,000 12,742,000
Cost of product
sales 935,000 918,000 4,882,000 2,525,000
------------ ------------ ------------ ------------
Gross margin 4,710,000 3,604,000 22,418,000 10,217,000
Operating
expenses:
Research and
development 4,585,000 2,110,000 12,676,000 8,407,000
Sales and
marketing 1,892,000 2,217,000 7,146,000 6,291,000
General and
administrative 998,000 960,000 3,045,000 2,907,000
------------ ------------ ------------ ------------
Total operating
expenses 7,475,000 5,287,000 22,867,000 17,605,000
------------ ------------ ------------ ------------
Loss from
operations (2,765,000) (1,683,000) (449,000) (7,388,000)
Interest and
investment income 47,000 100,000 143,000 252,000
Interest and
investment expense (90,000) (91,000) (271,000) (271,000)
Other income
(expense), net (42,000) 2,000 (11,000) (13,000)
------------ ------------ ------------ ------------
Net loss $(2,850,000) $(1,672,000) $(588,000) $(7,420,000)
============ ============ ============ ============
Basic and diluted
net loss per share ($0.07) $(0.05) ($0.02) $(0.22)
============ ============ ============ ============
Weighted average shares used in
computing:
Basic and
diluted net
loss per
share 38,768,350 36,869,133 37,925,757 34,365,118
============ ============ ============ ============
SCICLONE PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS
September 30, December 31,
2003 2002
------------- -------------
(unaudited) (unaudited)
Current assets:
Cash and cash equivalents $65,269,000 $20,233,000
Restricted short-term investments 685,000 685,000
Other short-term investments 302,000 232,000
Accounts receivable, net of allowances
of $638,000 in 2003 and 2002 11,776,000 9,276,000
Inventories 4,156,000 3,431,000
Prepaid expenses and other current
assets 2,771,000 2,297,000
------------- -------------
Total current assets 84,959,000 36,154,000
Property and equipment, net 95,000 111,000
Intangible assets, net 630,000 682,000
Other assets 138,000 164,000
------------- -------------
Total assets $85,822,000 $37,111,000
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $3,670,000 $3,150,000
Accrued compensation and employee
benefits 1,008,000 1,089,000
Accrued clinical trials expense 680,000 966,000
Accrued professional fees 553,000 679,000
Deferred revenue 895,000 895,000
Other accrued expenses 283,000 259,000
------------- -------------
Total current liabilities 7,089,000 7,038,000
Deferred revenue 448,000 1,119,000
Convertible notes payable 5,600,000 5,600,000
Commitments and contingencies
Stockholders' equity:
Preferred stock; $0.001 par value;
10,000,000 shares authorized; no
shares outstanding in 2003 and
2002, respectively - - - - - -
Common stock; $0.001 par value (no par
value in 2002); 75,000,000
shares authorized; 44,362,567 and
36,904,916 shares issued and
outstanding in 2003 and 2002,
respectively 44,000 156,290,000
Additional paid-in capital 206,106,000 - - -
Accumulated other comprehensive income 138,000 79,000
Accumulated deficit (133,603,000) (133,015,000)
------------- -------------
Total stockholders' equity 72,685,000 23,354,000
------------- -------------
Total liabilities and stockholders' equity $85,822,000 $37,111,000
============= =============
SCICLONE PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine months ended
September 30,
2003 2002
------------ ------------
(unaudited) (unaudited)
Operating activities:
Net loss $(588,000) $(7,420,000)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization 134,000 421,000
Changes in operating assets and
liabilities:
Accounts receivable, net (2,500,000) (217,000)
Inventories (725,000) 733,000
Prepared expenses and other current
assets (468,000) 436,000
Accounts payable and other accrued
expenses 544,000 998,000
Accrued compensation and employee
benefits (81,000) (119,000)
Accrued clinical trials expense (286,000) 475,000
Accrued professional fees (126,000) 12,000
Deferred revenue (671,000) 2,237,000
------------ ------------
Net cash used in operating activities (4,767,000) (2,444,000)
------------ ------------
Investing activities:
Purchase of property and equipment (46,000) (49,000)
Payment on purchase of marketable
securities (11,000) (23,000)
------------ ------------
Net cash used in operating activities (57,000) (72,000)
------------ ------------
Financing activities:
Proceeds from issuance of common stock net
of financing costs 49,860,000 10,526,000
------------ ------------
Net cash provided by financing activities 49,860,000 10,526,000
------------ ------------
Net increase in cash and cash equivalents 45,036,000 8,010,000
Cash and cash equivalents, beginning of
period 20,233,000 15,518,000
------------ ------------
Cash and cash equivalents, end of period $65,269,000 $23,528,000
============ ============
CONTACT: SciClone Pharmaceuticals, Inc.
Richard A. Waldron, CFO, 650-358-3437