Avalon Pharmaceuticals Reports Fourth Quarter and Full Year 2007 Results
19 Marzo 2008 - 2:15PM
Business Wire
Avalon Pharmaceuticals, Inc. (Nasdaq:AVRX), a clinical-stage
biopharmaceutical company focused on the discovery and development
of novel cancer therapeutics, today announced financial and
operational results for the fourth quarter and full year of 2007.
For the three months ended December 31, 2007, net loss was $5.1
million, compared with $4.4 million in the fourth quarter of 2006.
For the year ended December 31, 2007, net loss was $21.7 million,
compared with a loss of $17.1 million for 2006. As of December 31,
2007, cash, cash equivalents and marketable securities totaled
$28.5 million. �Avalon continues to execute on our corporate
strategy of building a pipeline of first-in-class drugs for Avalon
and our partners,� stated Kenneth C. Carter, Ph.D., President and
CEO. �Our Phase I and Phase II (a) clinical trials of AVN944
continue to demonstrate a strong safety profile and dose-dependant
biologic activity and pharmacology. Through our proprietary
AvalonRx� technology, we continue to advance our two key internal
pre-clinical programs for inhibitors of the Beta-catenin and
Aurora/Centrosome pathways and expect to nominate a development
candidate for Beta-catenin in 2008. We are making good progress in
our partnerships including our recently announced advancements in
the Novartis collaboration that triggered a research support
payment and our identification of hit compounds that affect the
Hsp90 pathway for our ChemDiv collaboration.� Conference Call &
Webcast Information Avalon will host a conference call on Thursday,
March 20, 2008 at 8:30 a.m. Eastern Time, to discuss Avalon
Pharmaceuticals� financial results as well as the 2008 business
outlook. Live audio of the conference call will be available to
investors, news media and the general public by dialing
1-888-287-5529 (in the U.S.) or 719-457-2088 (internationally), and
providing the participant pass code, 5811984. To access the call by
live webcast, please visit the Investor Relations section of our
website at http://www.Avalonrx.com. An archived version of the
webcast will be available for 30 days. Recent Highlights Patient
enrollment continued in both the AVN944 Phase I clinical trial for
hematological patients and the AVN944 Phase II (a) clinical trial
for pancreatic patients. Presentation of preliminary results from
the AVN944 Phase I trial in adult Acute Myelogenous Leukemia (AML)
patients that showed AVN944 is well tolerated in refractory AML
patients, with drug exposure increasing at higher dose levels and
patients experiencing reductions in blast cell counts. These data
were presented at the American Society of Hematology (ASH) Annual
Meeting. An additional ASH presentation showed the small molecule
compound family in the Company�s Beta-catenin pathway inhibitor
program has potent inhibitory effects on Wnt/Beta-catenin signaling
in Multiple Myeloma (MM) cells. The Beta-catenin pathway is
activated in the majority of MM cells, and is known to play a
critical role in Myeloma cell survival. The Company previously
demonstrated that this compound family potently inhibits colorectal
cancer cell growth. The Company�s drug discovery collaboration with
Novartis progressed to the next stage which triggered an
undisclosed payment to Avalon for research support. In the current
phase of this collaboration, the Company is characterizing
compounds identified from the completed high-throughput screen. The
Company identified hit compounds that affect the Hsp90 pathway
under its collaboration with ChemDiv. Dr. Philip Frost, M.D.,
Ph.D., was appointed to the Company�s board of directors. Dr. Frost
has extensive experience in drug discovery and development over a
very successful career in industry and academia, including leading
positions at Imclone, Wyeth, the University of Texas M.D. Anderson
Cancer Center and the University of California, Irvine. Company
Expectations for 2008 The Company is advancing numerous programs in
its strategy of building a pipeline of first-in-class drugs and is
driving to attain the following goals in 2008. Complete AVN944
Phase II(a) clinical trial (Pancreatic) Initiate AVN944 Phase II(b)
clinical trial (Pancreatic) Complete AVN944 Phase I clinical trial
(Hematological) Name Beta-catenin development candidate and begin
pre-IND enabling work Name Aurora/Centrosome novel target Partner
AVN944 and/or the Beta-catenin program Sign additional discovery
partnership Financial Results Net loss was $5.1 million for the
three months ended December 31, 2007 compared with $4.4 million in
the last three months of 2006. For all of 2007, net loss was $21.7
million, compared with $17.1 million in 2006. Lower revenues and
higher costs in the 2007 periods resulted in the higher losses in
2007. Total costs and expenses from operations were $5.4 million in
the fourth quarter of 2007, an increase of $0.1 million compared
with the $5.3 million reported for the fourth quarter of 2006.
Total costs and expenses were $23.6 million for 2007, compared with
$20.9 million in 2006. The increases in 2007 were principally due
to clinical trial costs related to AVN944. No revenues were
reported for the fourth quarter of 2007, compared with $0.7 million
in the fourth quarter of 2006. Revenues for the full year of 2007
were $0.8 million, compared with $2.7 million in 2006. Revenues in
2007 were from the collaboration with Novartis Institutes for
Biomedical Research. Revenues in 2006 were from collaborations with
Novartis Institutes for Biomedical Research, MedImmune and the
University of Louisville. As of December 31, 2007, the Company had
$28.5 million in cash, cash equivalents and marketable securities.
Of that amount, $5.3 million was held in a restricted account to
serve as collateral for long-term debt. Cash burn, defined as net
cash used for all activities excluding cash raised in equity
financings, was $4.9 million in the fourth quarter of 2007 and
$20.3 million for all of 2007. About Avalon Pharmaceuticals Avalon
is a biopharmaceutical company focused on the discovery,
development and commercialization of first-in-class cancer
therapeutics. Avalon�s lead product candidate, AVN944,�an IMPDH
inhibitor, is in Phase II clinical development. Avalon also has
preclinical programs to develop inhibitors of the Beta-catenin and
Aurora/Centrosome pathways,�discovery programs�for�inhibitors
of�the Survivin�and Myc�pathways and partnerships with Merck,
MedImmune, ChemDiv, Medarex, and Novartis. AvalonRx� is the
company�s proprietary platform�which is based
on�large-scale�biomarker identification and monitoring, used to
discover and develop therapeutics for pathways that have
historically been characterized as �undruggable.� Avalon is
headquartered in Germantown, MD. Forward Looking Statements This
announcement contains, in addition to historical information,
certain forward-looking statements that involve risks and
uncertainties, in particular, related to our expectations for 2008,
progress in our drug discovery programs and our collaborations, and
clinical progress in the development of AVN944. Such statements
reflect the current views of Avalon management and are based on
certain assumptions. Actual results could differ materially from
those currently anticipated as a result of a number of factors,
risks and uncertainties including the risk that the discovery
programs and collaborations may not be successful and that AVN944
will not progress successfully in its clinical trials, we may not
be successful in partnering any of our internal programs or in
signing new discovery partnerships, and other risks described in
our SEC filings. There can be no assurance that our development
efforts will succeed, that AVN944 will receive required regulatory
clearance or, even if such regulatory clearance is received, that
any subsequent products will ultimately achieve commercial success.
The information in this Release should be read in conjunction with
the Risk Factors set forth in our 2006 Annual Report on Form 10-K
and updates contained in subsequent filings we make with the SEC.
AVALON PHARMACEUTICALS, INC. STATEMENTS OF OPERATIONS (in thousands
except for per share amounts) � � � � � Three Months Ended Twelve
Months Ended December 31, December 31, (unaudited) (unaudited) �
2007 2006 2007 2006 � � Revenues $ - $ 653 $ 809 $ 2,724 � Costs
and expenses: Research and development 3,613 3,360 15,322 13,269
General and administrative � 1,772 � � 1,927 � � 8,240 � � 7,661 �
Total costs and expenses � 5,385 � � 5,287 � � 23,562 � � 20,930 �
Loss from operations (5,385 ) (4,634 ) (22,753 ) (18,206 ) � Total
other income � 271 � � 243 � � 1,080 � � 1,104 � Net loss $ (5,114
) $ (4,391 ) $ (21,673 ) $ (17,102 ) � Net loss attributed to
common stockholders per common share - basic and diluted $ (0.30 )
$ (0.43 ) $ (1.42 ) $ (1.74 ) � Weighted average number of common
shares - basic and diluted 17,026,390 10,129,223 15,298,590
9,841,235 AVALON PHARMACEUTICALS, INC. BALANCE SHEET INFORMATION
(in thousands) � � � As of December 31, (unaudited) � ASSETS 2007
2006 Cash, cash equivalents and marketable securities $ 23,250 $
14,458 Restricted cash and securities 5,275 5,972 Property and
equipment, net 7,325 8,923 Other assets, net 1,455 2,038 Total
assets $ 37,305 $ 31,391 � LIABILITIES AND STOCKHOLDERS� EQUITY
Current liabilities $ 4,685 $ 5,641 Long-term liabilities 6,446
7,876 Total stockholders� equity 26,174 17,874 Total liabilities
and stockholders� equity $ 37,305 $ 31,391
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