UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE
SECURITIES EXCHANGE ACT OF 1934
For the month of: May, 2004
Commission File Number: 000-50393
NEUROCHEM INC.
7220 Frederick-Banting, Suite 100
Saint-Laurent, Quebec
H4S 2A1
Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F.
Form 20-F [ ] Form 40-F [X]
Indicate by check mark if the registrant is submitting the Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(1):
Yes [ ] No [X]
Indicate by check mark if the registrant is submitting the Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(7):
Yes [ ] No [X]
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g-3 under the Securities Exchange Act of 1934.
Yes [ ] No [X]
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b):
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.
NEUROCHEM INC.
May 11, 2004
By: /s/ David Skinner
---------------------------------------
David Skinner
Director, Legal Affairs,
General Counsel and Corporate Secretary
NEUROCHEM INC.
275 Armand-Frappier Blvd
[NEUROCHEM LOGO] Laval, Quebec, Canada H7V 4A7
================================================================================
FOLLOWING CHANGE IN YEAR-END
NEUROCHEM REPORTS RESULTS
FOR FIRST QUARTER OF FISCAL YEAR 2004
NEUROCHEM WILL HOST A CONFERENCE CALL TODAY AT 4:30 P.M. EDT
MONTREAL, MAY 11, 2004 - Neurochem Inc. (NASDAQ: NRMX; TSX: NRM) announced today
results for the first quarter, ended March 31, 2004, of its current fiscal year.
For the quarter, the Company reported a net loss of $9,164,000 ($0.31 per
share), compared to $5,609,000 ($0.25 per share) for the same period the
previous year.
The first quarter saw significant progress being made on each of Neurochem's
three clinical programs, as well as important management appointments and,
following the close of the quarter, the move to new headquarters for the Company
that will consolidate operations under one roof and improve overall efficiency.
"We have been moving quickly on all fronts and I am very pleased with our
achievements overall and with the results from our clinical programs," said Dr.
Francesco Bellini, Neurochem's Chairman and CEO. "While we are waiting for the
completion of the on-going Phase II/III clinical trial for Fibrillex(TM), a
large portion of our financial and human resources has been concentrated on the
initiation of the Phase III clinical trials in North America and Europe for
Alzhemed(TM). The two studies are designed to enroll about 950 mild-to-moderate
Alzheimer's Disease patients each. The North American Phase III trial is planned
to start in June 2004, to be followed shortly thereafter by the European Phase
III study in early 2005. These near-term and large drug development activities
will result in an increase in our monthly cash burn-rate and overall expenses,"
he added.
PROGRESS ON PRODUCT CANDIDATES
FIBRILLEX(TM)
For Fibrillex(TM), the Company received its third and fourth unanimous
recommendations from its Data Safety Monitoring Board (DSMB) of independent
medical experts to continue the Phase II/III clinical trial on its orphan drug
candidate Fibrillex(TM), for the treatment of Amyloid A (AA) Amyloidosis, a
serious consequence of chronic inflammatory and infectious diseases. Each
recommendation was made following a review of safety data by the DSMB. Positive
recommendations following earlier reviews were also unanimous. The Phase II/III
clinical trial, designated as Fast Track by the U.S. Food and Drug
Adminisration, is on target and is scheduled to end in January 2005. Assuming
positive
clinical outcomes from the Phase II/III trial, Neurochem expects regulatory
approvals by the end of 2005.
ALZHEMED(TM)
Progress in developing Neurochem's product candidate for Alzheimer's Disease
(AD), Alzhemed(TM), was also very encouraging as the Company reported positive
interim results in Alzheimer's patients after 12 months of treatment and, later,
following the close of the quarter, after 16 months of treatment. Overall, 82%
of the mild AD patients experienced stabilized or improved cognitive function
tests after 16 months of treatment with Alzhemed(TM). Alzhemed(TM) is presently
in a 21-month, open-label Phase II extension study and a North American Phase
III study is planned to begin in June 2004. During the quarter, Neurochem formed
a strategic alliance for the prevention and treatment of AD with the National
Research Council of Canada's Institute for Biological Sciences, and more
specifically with Dr. Harold J. Jennings, a world leader in the development of
innovative conjugated vaccines. To add to its vaccine strategy, Neurochem also
announced an in-licensing agreement with PRAECIS PHARMACEUTICALS INCORPORATED,
related to certain amyloid peptides for use in the development of a novel
synthetic vaccine to prevent and treat AD.
CEREBRIL(TM)
After the close of the quarter, Neurochem reported promising Phase II clinical
results and a good safety profile for Cerebril(TM), Neurochem's product
candidate for Hemorrhagic Stroke due to Cerebral Amyloid Angiopathy(HS-CAA).
There were no safety findings of concern in patients treated with Cerebril(TM).
The pharmacokinetic profile of this product candidate has been well
characterized, with Cerebril(TM) being detected in the cerebrospinal fluid (CSF)
of the patients, suggesting its ability to cross the blood-brain-barrier. The
Company is expected to initiate a Phase IIb clinical trial in early 2005
designed to determine whether Cerebril(TM) can prevent recurrence of stroke in
patients suffering from CAA.
ENHANCING THE INFRASTRUCTURE
The Company announced a conditional agreement to purchase the Shire BioChem
facilities located in Laval, Quebec. The transaction is expected to close in
May, 2004. This opportunity allows Neurochem to bring together employees into
one site and to house its growing number of employees within one
state-of-the-art facility. Two important additions to the Company's management
team were also announced during the quarter with the arrival of Ms. Christine
Lennon as Vice President, Business Development, and Ms. Judith Paquin as Vice
President, Human Resources.
CONFERENCE CALL
Neurochem will host a conference call today at 4:30 P.M. EDT. The telephone
number to access the conference call is 1 (800) 291-5032. A replay of the call
will be available until May 18, 2004. The telephone number to access the replay
of the call is 1 (800) 558-5253, code 21195095.
FINANCIAL RESULTS HIGHLIGHTS
The following information should be read in conjunction with the selected
financial information contained herein.
For the three month-period ended March 31, 2004, net loss amounted to $9,164,000
($0.31 per share), compared to $5,609,000 ($0.25 per share) for the same period
last year.
Research and development expenses, before research tax credits and grants,
amounted to $5,577,000 for the current quarter, compared to $4,656,000 for the
same period last year. The increase is mainly due to hiring additional employees
in clinical development. In the three month-period ended March 31, 2004, the
research and development expenses incurred were mainly to support: the on-going
Fibrillex(TM) Phase II/III clinical trials and open-label extension study; the
on-going Alzhemed(TM) Phase II extension study and advancement towards its Phase
III clinical trials; the successful completion of the Cerebril(TM) Phase II
clinical trial which ended in January 2004, as well as on-going drug discovery
programs. As at March 31, 2004, Neurochem had 162 patients in clinical trials.
Research tax credits amounted to $312,000 this quarter, compared to $266,000 for
the comparable quarter last year. Research tax credits represent tax credits
earned under the Quebec Scientific Research and Experimental Development
program. The increase is due to higher eligible expenses during the current
period.
Research grants and other amounted to $119,000 this quarter, compared to
$623,000 for the same quarter last year. In the prior year, research grants
consisted principally of investment contributions under the Technology
Partnerships Canada (TPC) Program received by the Company for the development of
Alzhemed(TM), as well as payments received from the FDA for the development of
Fibrillex(TM), whereas the amount reported for the current period consists only
of grants received from the FDA for Fibrillex(TM) and from the National Sciences
and Engineering Research Council (NSERC).
General and administrative expenses for the quarter totaled $3,965,000, compared
to $1,718,000 for the same quarter last year. The increase is essentially due to
the expansion of the corporate infrastructure necessary to support growth and
the overall activity level increase at the Company, in particular, in the legal,
administrative, marketing, and senior management functions of the Company. More
specifically, year over year, the increase is due in part to higher legal fees
incurred in relation to the Immtech litigation and other corporate matters,
higher Directors' and Officers' insurance costs resulting from our U.S.
financing and NASDAQ listing and increased awareness, educational and medical
conference activities related to AA Amyloidosis, Fibrillex(TM)'s target
indication.
Depreciation and amortization for the current quarter increased to $368,000 from
$321,000 for the comparable quarter last year. The increase reflects the
depreciation and amortization
associated with the acquisition of additional property and equipment, as well as
increases in patent costs, during the past year.
Interest income amounted to $322,000, compared to $161,000 for the comparable
quarter last year. The increase results from higher average cash balances in the
current period, compared to the same period last year and is offset by a larger
portion of the investment portfolio denominated in US dollars, which earned a
lower yield.
Foreign exchange gains amounted to $441,000 for the current quarter, compared to
$67,000 for the same quarter last year. The increase is attributable to higher
average cash and investment balances denominated in US dollars, along with the
weakening of the Canadian dollar versus the US dollar during the period.
Stock-based compensation
As of January 1, 2004, the Company implemented the new accounting policy
requiring the use of the fair value based method for recording stock options.
One of the transitional options available to the Company was to retroactively
apply the fair value based method to all employee stock options granted on or
after July 1, 2002 without restatement of prior periods. As a result, $2,162,000
was recorded as an adjustment to the opening deficit and additional paid-in
capital at January 1, 2004. In the current quarter, an amount of $424,000 was
expensed as a result of the new policy. See notes 2 and 4 of our interim
Consolidated Financial Statements.
LIQUIDITY AND CAPITAL RESOURCES
As at March 31, 2004, the Company had cash, cash equivalents and marketable
securities of $68,367,000 compared to $77,594,000 at December 31, 2003. The
decrease is due to funds used in operations and in investing activities, net of
proceeds received from the issue of additional share capital during the period
pursuant to the exercise of employee stock options.
As at April 30, 2004, the Company had 30,056,906 common shares outstanding,
2,491,747 options granted under the employee stock option plan and 4,000,000
warrants.
NEUROCHEM INC.
SELECTED UNAUDITED FINANCIAL HIGHLIGHTS ($'000CDN, EXCEPT PER SHARE DATA)
THREE-MONTH PERIOD ENDED
MARCH 31
-------------------------
CONSOLIDATED STATEMENTS OF OPERATIONS 2004 2003
- ------------------------------------- ---------- ----------
$ $
Expenses:
Research and development 5,577 4,656
Research tax credits & grants (431) (889)
General and administrative 3,965 1,718
Stock based compensation 424 -
Depreciation and amortization 368 321
Interest and bank charges 24 31
---------- ----------
9,927 5,837
Interest income 322 161
Foreign exchange gain 441 67
---------- ----------
Net loss (9,164) (5,609)
========== ==========
Net loss per share:
Basic (0.31) (0.25)
Diluted (0.31) (0.25)
========== ==========
Weighted average number of common
shares outstanding:
Basic 29,863,793 22,296,061
Diluted 34,817,965 25,551,169
========== ==========
AT AT
MARCH 31 DEC 31
CONSOLIDATED BALANCE SHEETS 2004 2003
- --------------------------- -------- -------
$ $
Cash, cash equivalents and marketable securities 68,367 77,594
Other current assets 5,349 4,503
------ ------
Total current assets 73,716 82,097
Long-term investment 4,421 4,421
Capital assets 7,816 7,481
Other long term assets 226 226
------ ------
Total assets 86,179 94,225
====== ======
Current liabilities 6,525 6,244
Obligations under capital leases 305 416
Shareholders' equity 79,349 87,565
------ ------
Total liabilities and shareholders' equity 86,179 94,225
====== ======
ABOUT NEUROCHEM
Neurochem is focused on the development and commercialization of innovative
therapeutics for neurological disorders. The Company's pipeline of proprietary,
disease-modifying, oral products addresses critical, unmet medical needs.
Fibrillex(TM), designated as an orphan drug and as a Fast Track Product
candidate, is in a Phase II/III clinical trial for the treatment of Amyloid A
Amyloidosis. Alzhemed(TM) and Cerebril(TM), for the treatment of Alzheimer's
Disease and for the prevention of Hemorrhagic Stroke caused by Cerebral Amyloid
Angiopathy, respectively, have both completed a Phase II clinical trial. For
additional information on Neurochem, please visit our website at:
(www.neurochem.com).
Certain statements contained in this news release, other than statements of fact
that are independently verifiable at the date hereof, may constitute
forward-looking statements. Such statements, based as they are on the current
expectations of management, inherently involve numerous risks and uncertainties,
known and unknown, many of which are beyond Neurochem's control. Such risks
include but are not limited to: the impact of general economic conditions,
general conditions in the pharmaceutical industry, changes in the regulatory
environment in the jurisdictions in which Neurochem does business, stock market
volatility, fluctuations in costs, and changes to the competitive environment
due to consolidation as well as other risks included in public filings of
Neurochem. Consequently, actual future results may differ materially from the
anticipated results expressed in the forward-looking statements. The reader
should not place undue reliance on the forward-looking statements included in
this news release. These statements speak only as of the date made and Neurochem
is under no obligation and disavows any intention to update or revise such
statements as a result of any event, circumstances or otherwise.
FOR FURTHER INFORMATION, PLEASE CONTACT:
Lise Hebert, Ph.D.
Vice President, Corporate Communications
lhebert@neurochem.com
Tel: (450) 680-4500
Fax: (450) 680-4501