BASEL, Switzerland and BRIDGEWATER N.J., Nov. 15, 2006 (PRIMEZONE) -- Speedel (SWX:SPPN) today announced financial results for the nine months ending September 30, 2006.
Financial Highlights
-- At September 30, 2006 liquid assets on hand were CHF 145.1 million
-- Cash-burn was CHF 17.8 million for the third quarter and CHF 51.1
million for the first nine months
-- Cash-burn for full year 2006 is now expected to be
CHF 70-75 million compared to previous guidance of about CHF 80
million
Konrad P. Wirz, Chief Financial Officer, commented: "We are revising our estimated full year 2006 cash-burn from about CHF 80 million to CHF 70-75 million, principally due to slower than expected recruitment in our Phase III clinical trial for SPP301 in diabetic kidney disease. As we previously disclosed, during the third quarter the company received CHF 13.9 million as a result of the early conversion of the convertible loan. With liquid assets of CHF 145.1 million we have sufficient funds to finance our current pipeline through Q1 2008."
Financial Key Data (a) (CHF million)
Q3 Q3 9m 9m
2006 2005 Change 2006 2005 Change
-----------------------------------------------
Revenues 0.0 0.0 -- 0.0 0.0 --
Research & Development (14.2) (12.2) +2.0 (45.2) (41.6) +3.6
General & Administration (2.1) (2.6) -0.5 (7.9) (8.0) -0.1
Total operating
expenses (16.3) (14.8) +1.5 (53.1) (49.6) +3.5
Operating loss (16.3) (14.8) +1.5 (53.1) (49.6) +3.5
Finance costs, net 0.1 (0.6) -0.7 (7.0) (1.0) +6.0
Taxes 0.0 0.1 +0.1 0.7 0.7 --
Loss for the period (16.1) (15.3) +0.8 (59.5) (49.9) +9.6
Basic & diluted loss
per share/CHF (b) (2.24) (2.45) -0.21 (8.84) (9.04) -0.20
Cash-burn (c) 17.8 13.4 +4.4 51.1 45.6 +5.5
Sep 30 Dec 31 Change
06 05
Liquid assets (d) 145.1 101.1 +44.0
Footnotes (a)-(d) can be found on last page of this press release.
Consolidation is based on IFRS, but these results for the period are unaudited. Complete financial statements and notes for the nine months ending September 30, 2006 can be accessed at http://www.speedel.com/section/6/subsections/3
SPP301 Phase III trial update
We have now recruited 52% of patients for the SPP301 Phase III trial in diabetic kidney disease. We expect to achieve between 55-60% of patient recruitment by year end 2006 compared to our previous guidance of 75%. A number of measures have been undertaken to improve the recruitment rate, by increasing the number of sites and expanding the number of countries. We still plan to recruit over 2,000 patients and anticipate completing recruitment around mid 2007. Since the Phase III trial is event-driven it is difficult to be precise about the completion date. Currently we estimate a delay of about one to two quarters of a year to our original plans, and we still expect to complete the Phase lll trial by the end of 2009.
Research & Development Expenses
R&D expenses increased by CHF 2.0 million for the third quarter and by CHF 3.6 million for the first nine months compared to the corresponding periods in 2005. This difference is due to two main factors which partially offset each other: during the first quarter of 2005 there was a CHF 4.0 million licence fee payment to a licensor upon reaching a development milestone, whereas during the first nine months of 2006 there was an increase in ongoing R&D costs, mainly for the development programme of SPP301 which only entered Phase III in the second half of 2005.
General & Administration Expenses
G&A expenses decreased by CHF 0.5 million for the third quarter and by CHF 0.1 million for the first nine months compared to the corresponding periods in 2005. Two factors have offset each other: the one-off costs for the listing of the company's shares on the SWX Swiss Exchange in September 2005, and the increased non-cash expensing of new share options in 2006.
Finance Costs, net
Net finance costs decreased by CHF 0.7 million for the third quarter and increased by CHF 6.0 million for the first nine months compared to the corresponding periods in 2005. This increase was largely due to the early conversion of CHF 63.6 million of the CHF 70 million convertible loan, which has resulted in bringing forward the non-cash amortisation charge as the loan has a maturity date of July 31, 2007. Meanwhile financial income has improved due to the increased funds available for investment and this is reflected in the results for the third quarter.
Balance Sheet
As of September 30, 2006, liquid assets on hand were CHF 145.1 million compared to CHF 101.1 million at December 31, 2005. This reflects the public offering of 500,000 existing treasury shares during March 2006 which raised net proceeds of CHF 78.7 million.
As previously disclosed at the company's half-year results, holders of over 90% of the company's outstanding CHF 70 million of loan notes have converted them into Speedel shares during the second and third quarters of 2006. CHF 63.6 million of the loan was converted into 636,200 shares, resulting in a cash inflow to Speedel of CHF 2.0 million in the second quarter and CHF 13.9 million in the third quarter. CHF 6.4 million of the loan remains unconverted as per the terms of the loan agreement.
Outlook
The company reiterates its previous guidance that it has sufficient funds to finance its current pipeline through Q1 2008.
Share Capital
On September 30, 2006, Speedel Holding Ltd had issued capital of 7,651,085 registered voting shares with a nominal value of CHF 2 per share which are listed on the SWX Swiss Exchange under the symbol SPPN. In addition the company had outstanding conditional capital of 669,510 registered voting shares with a nominal value of CHF 2 per share. These cover the company's share option plan and the remaining element of the convertible loan. The conditional capital also includes those shares not issued to Abbott Laboratories when it did not exercise its license-back option for SPP200 in August 2006 due to strategic portfolio considerations. Since the expiry of the lock ups for board and management members related to the March public offering, and together with the increase in issued capital for the early conversion of the loan, Speedel's free float on the SWX Swiss Exchange has increased from about 35% to about 40%.
News flow
-- On August 16 the top-line results of the Phase II trial with SPP200
were announced and showed promising safety and efficacy in 127
patients undergoing chronic haemodialysis for end-stage renal
disease. Speedel retained all development and commercialisation
rights to SPP200 after Abbott Laboratories decided not to exercise
its license-back option due to strategic portfolio considerations.
-- On September 4 at the World Congress of Cardiology, the first
pooled data analysis of SPP100 (aliskiren, Tekturna(1)) was
presented which confirmed its efficacy and safety in over 7,000
hypertensive patients.
-- On September 28 it was announced that the European Medicines Agency
(EMEA) had accepted for review Novartis' submission for SPP100
(aliskiren, Tekturna) as a treatment for hypertension both as
monotherapy and in co-administration with other anti-hypertensives.
-- On October 31 Speedel announced the start of a Phase IIa trial with
SPP635, its next generation renin inhibitor, for the treatment of
hypertension.
-- On November 17 at the American Society of Nephrology meeting in San
Diego, the data will be presented from the Phase II trial of SPP200
for the reduction of vascular graft occlusion in patients
undergoing chronic haemodialysis for end-stage renal disease.
Web Cast and Conference Call
At 17:00 CET /16:00 London/ 11:00 EST today November 15, 2006, the company will host a web cast which can be accessed at http://www.speedel.com/section/6/subsections/7. In addition participants may join a teleconference facility using the following telephone numbers:
Switzerland: +41 (0) 61 5800 002 UK: +44 (0) 845 146 2035 USA: +1 866 224 3295 Passcode for all: 9888294
Slides for the web cast will be downloadable from 10:00 CET today and the web cast will be accessible on the company's website until December 15, 2006.
Calendar 2006/7
R&D Day November 29 Full Year 2006 Results March 23 Annual Report Published April 12 Q1 Results May 04 AGM May 10 Q2 Results August 15 Q3 Results November 14
About Speedel
Speedel is a public biopharmaceutical company that seeks to create value for patients, partners and investors by developing innovative therapies for cardiovascular and metabolic diseases. Speedel is a world leader in renin inhibition, a promising new approach with significant potential for treating cardiovascular diseases. Our lead compound SPP100 (aliskiren, Tekturna)(2), the first-in-class renin inhibitor, is partnered with Novartis for Phase III development and commercialisation in hypertension; SPP100 was filed with the FDA in the US in Q12006 and with the EMEA in the EU in Q32006. Our pipeline covers three different modes of action, and in addition to SPP100, includes SPP301 in Phase III, SPP200 in Phase II, SPP635 in Phase II, and several pre-clinical projects.
Speedel develops novel product candidates through focused innovation and smart drug development from lead identification to the end of Phase II. We either partner with big pharma for Phase III and commercialisation in primary-care indications, or we may ourselves complete Phase III development in specialist indications. Candidate compounds for development and the company's intellectual property come from our late-stage research unit Speedel Experimenta and from in-licensing. Our team of approximately 70 employees, including over 30 experienced pharmaceutical scientists, is located at our headquarters and laboratories in Basel, Switzerland and at offices in New Jersey, USA and Tokyo, Japan.
In March 2006 the company raised gross proceeds of CHF 83.95 million (approximately EUR 53m or US$64m) through the public offering of 500,000 treasury shares. As a private company, we have previously raised gross proceeds of CHF 239 million (approximately EUR 154 million or US$183 million) from private placements of equity securities and two convertible loans and we have had total revenues, principally from milestone payments, of CHF 57.7 million (approximately EUR 37 million or US$44 million). The company's shares were listed on the SWX Swiss Exchange under the symbol SPPN on September 08, 2005.
Forward looking statements
This press release includes forward-looking statements that involve substantial risks and uncertainties. These forward-looking statements are based on our current expectations and projections about future events. All statements, other than statements of historical facts, regarding our strategy, future operations, future financial position, future revenues, projected costs, prospects, plans and objectives of management are forward-looking statements. The words "may", "expects" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We or our partners may not actually achieve the plans, intentions or expectations described in these forward-looking statements and you should not place undue reliance on them. There can be no assurance that actual results of our research and development activities and our results of operations will not differ materially from these expectations. Factors that could cause actual results to differ from expectations include, among others: our or our partners' ability to develop safe and efficacious products; our or our partners' ability to achieve positive results in clinical trials; our or our partners' ability to obtain marketing approval and market acceptance for our product candidates; our ability to enter into future collaboration and licensing agreements; the impact of competition and technological change; existing and future regulations affecting our business; changes in governmental oversight of pharmaceutical product development; the future scope of our patent coverage or that of third parties; the effects of any future litigation; general economic and business conditions, both internationally and within our industry, including exchange rate variations; and our future financing plans.
Footnotes
(1) Tekturna (SPP100, aliskiren) is a Novartis trade name (2) Tekturna (SPP100, aliskiren) is a Novartis trade name
End Notes to Financial Key Data
(a) Numbers may not add up due to rounding
(b) Earnings per share are calculated on the weighted average of
registered shares outstanding for the periods:
Q3 2006 = 7,200,681; Q3 2005 = 6,270,305; 9m 2006 = 6,725,730;
9m 2005 = 5,523,603
(c) Cash-burn is defined as the difference in liquid assets between
the beginning and end of the period, minus any cash inflow during
the period
(d) Includes cash and cash equivalents and financial assets at fair
value through profit and loss