Arena Pharmaceuticals Announces Increased Revenues for 2001 Third Quarter and Nine Months Results
SAN DIEGO, Oct. 18 /PRNewswire/ -- Arena Pharmaceuticals, Inc. (Nasdaq: ARNA) today reported revenues of $3.5 million for the quarter ended September 30, 2001, a 50% increase over third quarter 2000 revenues, and $12.2 million for the nine months ended September 30, 2001, a 238% increase over the nine months ended September 30, 2000. Increased revenues in the third quarter and the first nine months of 2001 were primarily attributable to collaborations, which included research funding, milestone payments and technology access and development fees. The Company reported a net loss for the third quarter and first nine months of 2001 of $2.0 million, or $.07 per share, and $4.1 million, or $.17 per share, after non-cash accounting and amortization charges of $1.5 million and $4.3 million, respectively. This compares with prior year losses for the third quarter and first nine months, before any preferred stock charges, of $1.4 million, or $.07 per share and $7.4 million, or $.47 per share, on a pro forma basis, respectively.
Research and development expenses increased to $6.2 million in the third quarter of 2001 as compared to $3.5 million in the third quarter of 2000. For the nine months ended September 30, 2001, research and development expenses increased by $6.9 million to $15.4 million from $8.5 million for the nine months ended September 30, 2000.
Cash and cash equivalents totaled $239.5 million at September 30, 2001 and reflect the net proceeds from the Company's secondary offering, including the exercise of the over-allotment option, totaling $123.0 million that was completed in June 2001.
"Arena initiated Project Genesis as a defined internal research focus earlier this year. We believe that we have made significant progress toward our Project Genesis goals of acquisition, mapping, and completion of medicinal discovery at all G protein-coupled receptor targets. We believe that this significant scientific undertaking is important for Arena's long term success and growth," said Jack Lief, President and CEO. "We expect that the information that we are developing from Project Genesis will significantly help to both enhance the value of our proprietary CART Technology deals and to provide Arena with the ability to select interesting targets for our own internal drug development. We believe Arena's year to date performance is on track to achieve both its revenues and earnings guidance as well as the discovery of many new and exciting drug leads."
Arena's CART and Melanophore technologies allow for the direct identification of modulators of G protein-coupled receptors ("GPCRs") in a ligand-independent manner, making the technologies particularly useful with respect to the estimated 800 therapeutically relevant GPCRs within the human genome. Such ligand-independent screening is made possible by proprietary genetic alteration of these receptors. Arena has initiated "Project Genesis," an internal program aimed at obtaining all of the human GPCRs, identifying the location of these receptors within the human body for purposes of understanding the function of such receptors, and screening each GPCR to identify receptor modulators that form the basis of drug candidates. Arena expects to use its CART Technology, in conjunction with its Melanophore Technology, which Arena believes provides a unique screening technique that eliminates the need for radioactive or fluorescent screening to complete Project Genesis within the next three to five years.
Certain statements in this press release are forward-looking statements that involve a number of risks and uncertainties. Such forward-looking statements include statements about Arena's expected revenues, earnings and financial results, Arena's ability to obtain drug targets for its own internal drug development and statements that are not historical facts, including statements which are preceded by, followed by, or that include the words "intends," "will," "plans," "expects," "anticipates," "estimates," "aim" and "believes" or similar words. For such statements, Arena claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Actual events or results may differ materially from Arena's expectations and reported results should not be considered as an indication of future performance. Important factors that could cause actual events or results to differ materially from those stated or implied by Arena's forward-looking statements include, but are not limited to, the following: the ability to complete Project Genesis, if at all, within a reasonable time period; future quarterly or annual financial results; the timing, success and cost of preclinical research, out-licensing endeavors and clinical studies, and receipt of additional milestone payments, if any, from collaborators. Additional risk factors that could cause actual events or results to differ materially from those in Arena's forward-looking statements are disclosed in Arena's SEC reports, including, but not limited to, Arena's registration statement filed on June 21, 2001 on Form S-1, as amended, most recent quarterly report on Form 10-Q, and most recent annual report on Form 10-K. These forward-looking statements represent Arena's judgment as of the date of this release. Arena disclaims, however, any intent or obligation to update these forward-looking statements.
Arena Pharmaceuticals, Inc. Condensed Consolidated Statements of Operations
Three months ended Nine months ended September 30, September 30, 2001 2000 2001 2000 (unaudited) (unaudited) (unaudited) (unaudited) Revenues Total revenues $3,472,338 $2,314,126 $12,194,928 $3,603,397 Expenses Research and development 6,230,959 3,465,360 15,375,823 8,546,347 General and administrative 1,462,779 800,383 3,820,335 1,719,883 Amortization of non-cash deferred compensation 1,071,653 1,123,358 3,413,050 2,952,402 Amortization of acquired technology and other purchased intangibles 384,249 -- 896,581 -- Total expenses 9,149,640 5,389,101 23,505,789 13,218,632 Interest and other income, net 3,657,748 1,656,381 7,230,621 2,188,359 Net loss (2,019,554) (1,418,594) (4,080,240) (7,426,876) Non-cash preferred stock charge -- -- -- (22,391,068) Net loss applicable to common stockholders $(2,019,554) $(1,418,594) $(4,080,240) $(29,817,944) Net loss per share, basic and diluted $(0.07) $(0.09) $(0.17) $(4.91) Shares used in calculating net loss per share, basic and diluted 27,236,326 15,706,593 24,194,049 6,069,278 Pro forma net loss per share $(0.07) $(1.89) Shares used in calculating pro forma net loss per share 19,571,378 15,801,764
|Note:||The loss per share on a pro forma basis assumes the conversion of|
|the redeemable preferred stock into common stock as of the date of|
|issuance. The redeemable preferred stock converted into common|
|stock at the closing of the Company's initial public offering on a|
Condensed Consolidated Balance Sheet Data: September 30, December 31, 2001 2000 (unaudited) Assets Cash and cash equivalents $239,546,307 $144,413,176 Other current assets 5,899,799 3,801,268 Property and equipment, net 14,436,105 4,265,260 Acquired technology, investments and other assets 19,696,873 232,225 Total assets $279,579,084 $152,711,929 Liabilities and Stockholders' Equity Liabilities $8,257,855 $3,927,604 Stockholders' equity 271,321,229 148,784,325 Total liabilities and stockholders' equity $279,579,084 $152,711,929
"Arena Pharmaceuticals" is a registered U.S. trademark of the company. "Arena" and "CART" are trademarks of the company. Arena's headquarters are located at 6166 Nancy Ridge Drive, San Diego, CA 92121. Arena's telephone number is (858) 453-7200. On the Internet, please refer to Arena's website: http://www.arenapharm.com or BRL Screening's website: http://www.brlscreening.com for further information regarding CART Technology and the Melanophore Technology.
For further information, contact:
Jack Lief, President & CEO: Extension 223
Joseph Mooney, CFO: Extension 508
SOURCE Arena Pharmaceuticals, Inc.
CONTACT: Jack Lief, President & CEO, Extension 223, or Joseph Mooney, CFO, Extension 508, both of Arena Pharmaceuticals, Inc./