Ligand Pharmaceuticals Announces First Quarter Results
Conference call begins at 4:30 p.m. Eastern time today
SAN DIEGO-- Ligand Pharmaceuticals Incorporated (NASDAQ: LGND) today announced financial results for the first quarter of 2010 and provided an operating forecast and program updates.
"Ligand recorded a number of important achievements in the first quarter, beginning with the closing of the Metabasis acquisition in January, and continuing with milestone payments from Merck and more recently Roche under fully funded research partnerships. We continue to make progress with our internal programs as well, including the presentation of positive Phase I data from our SARM program. Looking forward, we believe our diversified product pipeline, productive partnership collaborations and strong spending discipline hold potential to deliver strong cash flow over the long-term," said John L. Higgins, President and Chief Executive Officer of Ligand Pharmaceuticals.
Total revenues from continuing operations for the three months ended March 31, 2010 were $6.0 million, compared with $9.5 million for the same period in 2009. The decline was primarily due to decreases in collaboration revenues and milestones earned.
Operating costs and expenses from continuing operations in the first quarter of 2010 were $10.4 million, compared with $17.3 million in the first quarter of 2009. Research and development expenses decreased by $3.1 million, primarily due to lower costs associated with clinical trials and lower headcount. General and administrative expenses decreased by $3.8 million, primarily due to reduced legal fees, lower facilities costs and lower headcount.
The net loss in the first quarter of 2010 was $2.8 million, or $0.02 per share, compared with a net loss of $5.1 million, or $0.05 per share, in the comparable 2009 quarter. The loss from continuing operations in the first quarter of 2010 was $3.0 million, or $0.02 per share, compared with a loss from continuing operations of $7.5 million, or $0.07 per share, in the comparable 2009 quarter. Income from discontinued operations in the first quarter of 2010 was $0.2 million, or $0.00 per share, compared with income from discontinued operations of $2.4 million, or $0.02 per share, in the comparable 2009 quarter.
As of March 31, 2010, Ligand had cash, cash equivalents, short-term investments and other current assets of $40.4 million. Cash outflows during the quarter ended March 31, 2010 included approximately $8 million of expected non-recurring payments related to the acquisitions of Neurogen and Metabasis, legal settlement payments and a termination payment related to a collaboration with Bristol-Myers Squibb.
2010 Operating Forecast
Affirming its previous 2010 revenue forecast, Ligand expects 2010 total revenue of approximately $30 million, including approximately $6.0 million of non-cash deferred revenue, consisting of royalty payments from King Pharmaceuticals for sales of AVINZA(R) and from GlaxoSmithKline (GSK) for sales of PROMACTA, revenue from collaboration agreements and potential milestone payments from existing corporate partners. For the remaining three quarters of 2010, the Company anticipates total operating costs will be approximately $25 million, including non-cash expenses of approximately $4 million.
Select Program Highlights and Outlook
The following is a summary of key programs, including status highlights and outlook for 2010.
Promacta - GlaxoSmithKline
-- Revolade has been launched in a number of major markets such as Germany, Sweden and United Kingdom.
SERMs - Pfizer
-- Conbriza launch in Europe is expected in the second half of 2010 -- Viviant's pending NDA is expected to receive an FDA advisory committee following a submission of a complete response by Pfizer -- Aprela NDA submission is expected in the second half of 2010
CXCR2 (SCH 527123) - Merck
-- A Phase IIb chronic obstructive pulmonary disorder (COPD) trial in 500 patients was initiated in January 2010
CDK (SCH727965) - Merck, Phase II studies ongoing:
-- Non-small cell lung cancer (NSCLC) -- Acute myelogenous leukemia (AML) and acute lymphoblastic leukemia (ALL) -- Mantle cell lymphoma (MCL) and B-cell chronic lymphocytic leukemia (B-CLL)
Hepatitis C (RG7348) - Roche
-- A $6.5 million milestone payment was earned for progression into Phase I
-- First-in-human Phase I single ascending dose data for LGD-4033 was presented at the 14th International Congress of Endocrinology in Kyoto, Japan in March -- Preclinical data on molecular pharmacology on LGD-4033 is scheduled to be presented at the 92nd Annual Meeting of the Endocrine Society in San Diego on June 19, 2010 -- Completion and data for Phase Ib multiple ascending dose trial is targeted for the third quarter of 2010
Ligand management will host a conference call today beginning at 4:30 p.m. Eastern time (1:30 p.m. Pacific time) to discuss this announcement and answer questions. To participate via telephone, please dial (877) 407-4019 from the U.S. or (201) 689-8337 from outside the U.S., using the passcode "Ligand." A replay of the call will be available until June 4, 2010 at 5:30 p.m. Eastern time by dialing (877) 660-6853 from the U.S. or (201) 612-7415 from outside the U.S. The account number is 361 and the passcode is 349820. Individual investors can access the Webcast through Ligand's web site at www.ligand.com.
Ligand Analyst Day
Ligand will hold an Analyst Day event on June 24, 2010 in New York City. Ligand will announce full details regarding the event including program agenda by the end of May. Additional event details and webcast information will be posted closer to the event on Ligand's investor Web site at www.ligand.com.
About Ligand Pharmaceuticals
Ligand discovers and develops new drugs that address critical unmet medical needs of patients for a broad spectrum of diseases including hepatitis, muscle wasting, Alzheimer's, inflammatory diseases, anemia, COPD, asthma, rheumatoid arthritis and osteoporosis. Ligand's proprietary drug discovery and development programs are based on advanced cell-based assays, gene-expression tools, ultra-high throughput screening and one of the world's largest combinatorial chemical libraries. Ligand has strategic alliances with major pharmaceutical and biotechnology companies, including GlaxoSmithKline, Merck, Pfizer, Roche, Bristol-Myers Squibb, and Cephalon and more than 30 programs are in various stages of development by its partners.
This news release contains certain forward-looking statements by Ligand that involve risks and uncertainties and reflect Ligand's judgment as of the date of this release. Actual events or results may differ from Ligand's expectations. For example, we may not receive expected royalties on AVINZA(R) from King Pharmaceuticals, PROMACTA(R) from GSK or any other partnered products or from research and development milestones, and we may not be able to timely or successfully advance any product(s) in Ligand's pipeline. In addition, there can be no assurance that Ligand will achieve its guidance for 2010, that Ligand will deliver strong cash flow over the long-term, that Ligand's 2010 revenues will be driven by royalty payments related to AVINZA and PROMACTA sales, that results of any clinical study will be timely, favorable or confirmed by later studies, that products under development by Ligand or its partners will receive regulatory approval in 2010 or later, or that there will be a market for such product(s) if successfully developed and approved. Also, Ligand may experience delays in the commencement, enrollment, completion or analysis of clinical testing for its product candidates, or significant issues regarding the adequacy of its clinical trial designs or the execution of its clinical trials, which could result in increased costs and delays or limit Ligand's ability to obtain regulatory approval. Further, unexpected adverse side effects or inadequate therapeutic efficacy of Ligand's product(s) could delay or prevent regulatory approval or commercialization. Ligand may also have indemnification obligations to King Pharmaceuticals or Eisai in connection with the sales of the AVINZA and oncology product lines. In addition, Ligand may not be able to successfully implement its strategic growth plan or continue the development of its proprietary programs. The failure to meet expectations with respect to any of the foregoing matters may reduce Ligand's stock price. Additional information concerning these and other risk factors affecting Ligand's business can be found in prior press releases available via www.ligand.com as well as in Ligand's public periodic filings with the Securities and Exchange Commission at www.sec.gov. Ligand disclaims any intent or obligation to update these forward-looking statements beyond the date of this release. This caution is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.
LIGAND PHARMACEUTICALS INCORPORATED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (in thousands, except share data) Three Months Ended March 31, 2010 2009 Revenues: Royalties 1,962 2,730 Collaborative research and development and 3,996 6,740 other revenues 5,958 9,470 Operating costs and expenses: Research and development 7,362 10,462 General and administrative 3,048 6,817 Total operating costs and expenses 10,410 17,279 Amortization of deferred gain on sale (426 ) (491 ) leaseback Loss from operations (4,026 ) (7,318 ) Other income (expense), net 1,311 (164 ) Income tax expense (274 ) -- Loss from continuing operations (2,989 ) (7,482 ) Discontinued operations, net of taxes 239 2,366 Net income (loss) (2,750 ) (5,116 ) Basic and diluted per share amounts: Loss from continuing operations $ (0.02 ) $ (0.07 ) Discontinued operations 0.00 0.02 Net income (loss) $ (0.02 ) $ (0.05 ) Weighted average number of common shares 117,457,241 113,118,073
LIGAND PHARMACEUTICALS INCORPORATED CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) March 31, 2010 December 31, 2009 Assets (unaudited) Current assets: Cash, cash equivalents and short-term $ 39,056 $ 53,232 investments Accounts receivable, net 298 618 Other current assets 1,317 4,534 Current portion of co-promote termination 9,716 9,782 asset Total current assets 50,387 68,166 Restricted cash and investments 1,341 1,462 Property and equipment, net 7,772 8,522 Goodwill and other identifiable intangible 14,458 2,515 assets Long-term portion of co-promote termination 29,057 30,993 asset Other assets 30,605 30,149 133,620 141,807 Liabilities and Stockholders' Equity Accounts payable and accrued liabilities 25,693 35,699 Current portion of deferred gain 1,702 1,702 Current portion of co-promote termination 9,716 9,782 liability Current portion of deferred revenue 4,323 4,989 Total current liabilities 41,434 52,172 Long-term portion of co-promote termination 29,057 30,993 liability Long-term portion of deferred revenue 2,546 3,495 Long-term portion of deferred gain 1,277 1,702 Other long-term liabilities 48,817 41,357 Total liabilities 123,131 129,719 Common stock subject to conditional 8,344 8,344 redemption Stockholders' equity 2,145 3,744 $ 133,620 $ 141,807
Source: Ligand Pharmaceuticals Incorporated
Released May 5, 2010