EXHIBIT 99.1
Geron Corporation Reports 2004 Second Quarter Results
MENLO PARK, Calif.--(BUSINESS WIRE)--July 30, 2004--Geron
Corporation (Nasdaq:GERN) today reported financial results for the
three and six months ended June 30, 2004.
For the second quarter of 2004, the company reported a net loss of
$8.9 million or $(0.20) per share compared to $9.3 million or $(0.32)
per share in the second quarter of 2003. Net loss for the first six
months of 2004 was $60.6 million or $(1.41) per share compared to
$17.2 million or $(0.63) per share for the same period in 2003.
Revenues for the second quarter of 2004 were $366,000 compared to
$285,000 for the comparable period in 2003. Revenues for the second
quarter of 2004 included royalty revenues under license agreements
with companies for sales of telomerase detection and measurement kits,
and license fee revenues recognized from license agreements with
multiple companies for nuclear transfer and telomerase technology. The
increase in revenue in 2004 reflected new license agreements for
Geron's telomerase technology signed during the second quarter of
2004.
Operating expenses for the second quarter of 2004 were $9.5
million compared to $8.9 million for the comparable period in 2003.
The increase in operating expenses is the net result of reduced
research related costs and increased accounting and legal expenses
associated with additional regulatory compliance related to the
Sarbanes-Oxley Act, with the Kirin litigation described below, and
with various corporate transactions. The increase in operating
expenses for the six month period of 2004 was attributable to a
non-cash charge of $45.2 million to acquire in-process research
technology, which resulted from the licensing of technology rights
from Merix Bioscience, Inc.
Second Quarter 2004 Highlights:
-- Geron granted rights to XenoTrans Ltd. for nuclear transfer
technology to produce transgenic pigs. XenoTrans' strategy is
to produce genetically modified pigs for the purpose of
generating organs suitable for transplantation into humans.
-- In April 2004, Kirin Brewery Co., Ltd. had filed a lawsuit
against Geron in the U.S. District Court for the Northern
District of California. The lawsuit alleged interference with
contract and interference with Kirin's prospective business
advantage in connection with Geron's recent acquisition of
rights from Merix Bioscience, Inc. for the development of
cancer vaccines. In June 2004, Kirin and Geron resolved the
litigation between them. The settlement did not involve any
payment or transfer of intellectual property rights or any
other conveyance of value by either party to the other and has
no effect on the existing license agreement between Geron and
Merix. The lawsuit has been dismissed.
-- Geron granted to American Type Culture Collection a
non-exclusive license to create and distribute cell lines
immortalized with human telomerase reverse transcriptase
(hTERT), and the hTERT gene itself, to the research-use-only
market.
-- Nature Biotechnology published research results that identify
genes active in human embryonic stem cells (hESCs) and in
hESCs undergoing differentiation. The work was performed under
Geron's prior collaboration with Celera Genomics Group. This
information will facilitate derivation of useful
differentiated cell types for therapy, and may also lead to
the development of novel tools for drug discovery.
-- Geron, CXR Biosciences Ltd. and the Roslin Institute formed a
collaboration to develop and commercialize hESC-derived
hepatocytes for use in in vitro assays of drug metabolism and
toxicity.
-- At the American Society of Clinical Oncology annual meeting,
Johannes Vieweg, M.D., of Duke University Medical Center
presented new positive results from a Phase I/II clinical
trial of Geron's telomerase therapeutic vaccine in metastatic
prostate cancer. The results showed that the vaccinations
induced vigorous immune responses without treatment-related
side effects and the high-dose patient group showed
statistically significant increase in PSA doubling time.
-- In June 2004, Geron announced the termination of the license
and collaboration agreement between Geron and Kyowa Hakko and
the return of the Asian territory development and marketing
rights for telomerase inhibitors that had been granted to
Kyowa Hakko. Geron now holds all worldwide product rights for
telomerase inhibition.
Geron is a biopharmaceutical company focused on developing and
commercializing therapeutic and diagnostic products for cancer based
on its telomerase technology, and cell-based therapeutics using its
human embryonic stem cell technology.
This news release may contain forward-looking statements made
pursuant to the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995. Investors are cautioned that such
forward-looking statements in this press release regarding potential
applications of Geron's technology constitute forward-looking
statements involving risks and uncertainties, including without
limitation, risks inherent in the development and commercialization of
potential products, reliance on collaborators, need for additional
capital, need for regulatory approvals or clearances, and the
maintenance of our intellectual property rights. Actual results may
differ materially from the results anticipated in these
forward-looking statements. Additional information on potential
factors that could affect our results and other risks and
uncertainties are detailed from time to time in Geron's periodic
reports, including the quarterly report on Form 10-Q for the quarter
ended March 31, 2004.
Additional information about the company can be obtained at
http://www.geron.com.
Financial table follows.
GERON CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
2004 2003 2004 2003
(In thousands, ---- ---- ---- ----
except share and
per share amounts)
Revenues from
collaborative
agreements $-- $36 $ -- $ 72
License fees and
royalties 366 249 614 475
------------- ------------ ------------ ------------
Total revenues 366 285 614 547
Operating
expenses:
Research and
development 7,481 7,673 13,199 14,523
Acquired in-
process
research
technology -- -- 45,150 --
General and
administrative 2,053 1,265 3,444 2,721
------------- ------------ ------------ ------------
Total operating
expenses 9,534 8,938 61,793 17,244
------------- ------------ ------------ ------------
Loss from
operations (9,168) (8,653) (61,179) (16,697)
Interest and
other income 385 394 883 670
Debenture
conversion
expense -- (779) -- (779)
Interest and
other expense (162) (250) (332) (414)
------------- ------------ ------------ ------------
Net loss $(8,945) $(9,288) $(60,628) $(17,220)
============= ============ ============ ============
Basic and diluted
net loss per
share $(0.20) $(0.32) $(1.41) $(0.63)
============= ============ ============ ============
Weighted average
shares used in
calculation of
basic and
diluted net loss
per share 45,264,590 29,452,031 42,857,203 27,193,803
============= ============ ============ ============
CONDENSED CONSOLIDATED BALANCE SHEETS
JUNE 30, DECEMBER 31,
(In thousands) 2004 2003
-------------- --------------
(Unaudited) (Note 1)
Current assets:
Cash, restricted cash and cash
equivalents $8,556 $13,353
Marketable securities 85,920 96,427
Interest and other receivables 5,122 1,146
Other current assets 4,236 882
-------------- --------------
Total current assets 103,834 111,808
Property and equipment, net 2,035 1,684
Deposits and other assets 713 804
Intangible assets 2,387 3,819
-------------- --------------
$108,969 $118,115
============== ==============
Current liabilities $9,081 $9,825
Noncurrent liabilities 902 1,966
Stockholders' equity 98,986 106,324
-------------- --------------
$108,969 $118,115
============== ==============
Note 1: Derived from audited financial statements included in Geron's
Annual Report on Form 10-K, filed with the SEC.
CONTACT: Geron Corporation
David L. Greenwood, 650-473-7765