OctoPlus announces 2009 first half-year results
(Thomson Reuters ONE) - OctoPlus N.V. ("OctoPlus" or the "Company") (Euronext: OCTO), thedrug delivery company, announces today its results for the six-monthperiod ended 30 June 2009.Highlights for the first six monthsFinancial results- Increase of 168% in revenues to ? 10.0 million for the firstsix-month period in 2009 from ? 3.7 million in 2008- Revenue growth well on track with previous guidance for the fullyear of ? 19 million- Successful equity raising of ? 6.0 million (gross) with aninternational consortium of investors completed in February 2009- Net loss for the first six-month period significantly decreased to? 1.6 million, as a result of the new service-based strategy, despiterestructuring costs and costs related to the new manufacturingfacility (H1 2008: net loss of ? 6.4 million)Operational results- Collaboration with Biolex Therapeutics for Locteron® progressing asplanned -Significant clinical progress for Locteron with completion ofpatient enrollment in Phase IIb study; key results expected in thefourth quarter- New GMP manufacturing facility opened in June- One-off costs associated with the new manufacturing facility andwith the transition to a fully service-based business have beenhigher than expected, which has had a significant impact on theCompany's operating result- OctoPlus' new CFO Susan Swarte joined the Company in AugustStrategy- Ongoing success for OctoPlus' new service-oriented strategy withtwo additional drug delivery technology evaluation contracts signedin 2009Outlook- OctoPlus reiterates the forecasted 2009 revenues of approximately ?19 millionSimon Sturge, CEO of OctoPlus comments: "We are very pleased with theaccomplishments made in the first six months of 2009. Revenuesincreased significantly as a result of our new service-based strategyand we were able to report two new drug delivery technologyevaluation contracts, the opening of our new manufacturing facilityas well as great progress in the clinical development of Locteron. Wehave been more aggressive in reducing the cost base of the businessthan originally planned in order to be able to be more competitive inwinning new business, and as a consequence restructuring costs in thefirst half of the year have been higher than expected. These one-offcosts, along with final costs related to the new manufacturingfacility, have prevented us from being operationally cash flowpositive in the first six months of 2009."Conference call and webcast presentationOctoPlus will hold a conference call and webcast presentation todayat 10:00 AM CET. This event can also be followed live via OctoPlus'website www.octoplus.nl. If you would like to participate in theconference call, please dial in on telephone number +31 (0) 45 6316901. After the presentation, Simon Sturge, CEO of OctoPlus, SusanSwarte, CFO, and Leo Vissers, Financial Controller, will be availableto answer questions. After the event, the webcast will be availablefor replay on the Company's website.ContactFor further information, please contact: Rianne Roukema, CorporateCommunications: telephone number +31 (71) 524 1071 or send an e-mailto Investor Relations at IR(at)octoplus.nl.About OctoPlusOctoPlus is a product-oriented biopharmaceutical company committed tothe creation of improved pharmaceutical products that are based onOctoPlus' proprietary drug delivery technologies and have fewer sideeffects, improved patient convenience and a better efficacy/safetybalance than existing therapies. Rather than seeking to discovernovel drug candidates through early stage research activities,OctoPlus focuses on the development of long-acting, controlledrelease versions of known protein therapeutics, other drugs, andvaccines on behalf of its clients.The clinically most advanced product incorporating our technology isBiolex Therapeutics' lead product Locteron, a controlled releaseformulation of interferon alpha for the treatment of chronichepatitis C. Locteron is being manufactured for Biolex Therapeuticsby OctoPlus and is currently in Phase IIb clinical studies.In addition, OctoPlus is a leading European provider of advanced drugformulation and clinical scale manufacturing services to thepharmaceutical and biotechnology industries, with a focus ondifficult-to-formulate active pharmaceutical ingredients.OctoPlus is listed on Euronext Amsterdam by NYSE Euronext under thesymbol OCTO. For more information about OctoPlus, please visit ourwebsite www.octoplus.nl.This document may contain certain forward-looking statements relatingto the business, financial performance and results of OctoPlus andthe industry in which it operates. These statements are based onOctoPlus' current plans, estimates and projections, as well as itsexpectations of external conditions and events. In particular thewords "expect", "anticipate", "predict", "estimate", "project","plan", "may", "should", "would", "will", "intend", "believe" andsimilar expressions are intended to identify forward-lookingstatements. We caution investors that a number of important factors,and the inherent risks and uncertainties that such statementsinvolve, could cause actual results or outcomes to differ materiallyfrom those expressed in any forward-looking statements. In the eventof any inconsistency between an English version and a Dutch versionof this document, the English version will prevail over the Dutchversion.Interim Financial Report from the Executive BoardBusiness overviewOctoPlus' consolidated external revenues for the first six-monthperiod increased by 168% from ? 3.7 million in 2008 to ? 10.0 millionin 2009. A significant part of the external service revenues camefrom process development work for and clinical manufacturing ofLocteron, and from other long-term contracts. The Company also signeda significant number of new customer contracts during the period,including two additional drug delivery technology evaluationcontracts with pharmaceutical companies who have engaged OctoPlus todevelop a controlled release formulation of their products, usingOctoPlus' patented drug delivery technologies.FinancingOn 27 February 2009, OctoPlus announced the successful completion ofan equity raising of ? 6.0 million (gross) through a privateplacement of ordinary shares with new and existing institutionalinvestors. As part of this equity raising, the bridge loans providedby Life Sciences Partners and S.R. One amounting to ? 4.5 million(including accumulated interest) were converted into equity undersimilar conditions. Following the equity raising, ABN Amro Bank N.V.reduced OctoPlus' credit facility to ? 1.5 million from July 2009onwards and intends to further reduce the facility to ? 1.0 millionfrom October 2009 onwards.LocteronThe collaboration with Biolex Therapeutics ('Biolex') for Locteron isprogressing as planned. Biolex initiated a Phase IIb clinical studywith Locteron in April and completed patient enrollment for thisstudy in June. OctoPlus continues to perform process development workfor and clinical manufacturing of Locteron. Locteron remains a majorproduct in our revenue forecast through to 2010 and should thisproduct not progress in line with our expectations this will have amajor impact on our business.Expanded manufacturing facilityOctoPlus announced in June the start of pharmaceutical production inits new manufacturing facility in Leiden. With the expansion,OctoPlus' manufacturing capacity more than doubled and the Companycan now produce clinical scale Phase I, II, III and even small-scalecommercial supplies of injectable pharmaceutical products and othercomplex formulations.Financial overviewThe table below outlines the key financial figures of the Company forthe six-month period ended 30 June 2009 and 2008. These financialfigures are unaudited and are in accordance with InternationalFinancial Reporting Standards, as adopted by the European Union. Nowthat OctoPlus no longer invests in its own product development,inter-segment revenues have diminished.Key figures first six months 2009(Unaudited, in Euro x 1,000; exceptper share data) 1H 2009 1H 2008 % changeGross revenues 10,071 5,978 68%Inter-segment revenues (68) (2,240) 97%Consolidated revenues 10,003 3,738 168%Result for the period (1,627) (6,414) 75%Result per share (basic and diluted) (0.06) (0.40) 85%Cash, cash equivalents and bank 1,514 (3,713)overdrafts per end of periodFirst six months ended 30 June 2009Over the first six months of 2009, consolidated revenues showed anincrease of 168% to ? 10,003 (2008: ? 3,738). The Company sold andout-licensed its rights to its lead product Locteron to formerco-development partner Biolex in October 2008. From that dateonwards, OctoPlus is reimbursed for all process development for andclinical manufacturing of Locteron. This resulted in a significantincrease in consolidated external revenues and it diminishedinter-segment revenues.Total operating costs for the first six months of 2009 increased by13% from ? 9,621 in 2008 to ? 10,885 in 2009. Expenditures forclinical development decreased significantly after the sale andout-licensing of OctoPlus' rights to Locteron in October 2008. On theother hand, the Company incurred restructuring charges in the firstsix months of 2009 as a result of the transition from a productdevelopment company to a company that focuses on providingpharmaceutical development services to clients. In addition, theCompany's new manufacturing facility became operational, requiringadditional staff and other costs to operate this facility.Interest costs for the six-month period increased by 40% to ? 745(2008: ? 531) as a result of higher interest charges for financelease contracts.As a result of the above, net loss for the period decreased by 75% to? 1,627 (2008: net loss of ? 6,414).Cash flowThe total cash and cash equivalents balance (net of bank overdrafts)increased significantly from ? -/- 3,713 per 30 June 2008 to ? 1,514per 30 June 2009.The cash and cash equivalent balance between 30 June 2008 and 30 June2009 increased as a result of:- an $11.0 million up-front payment received from Biolex in October2008 for the sale and out-licensing of OctoPlus' rights to Locteron- the ? 6.0 million (gross) received as part of the equity raising inFebruary 2009- the ? 3.7 million received as part of a sale-and-lease-back of partof the equipment used in the Company's new manufacturing facility inthe second part of 2008.The cash and cash equivalent balance between 30 June 2008 and 30 June2009 decreased as a result of- significant cash outflows in the third quarter of 2008 when theCompany still paid for its own product development (mainly Locteron)- investments in the Company's new manufacturing facility- restructuring payments in the first half of 2009.In the first six months of 2009, a total of ? 1,958 of cash was usedfor OctoPlus' operating activities (first six months of 2008: ? 5,554cash outflow). This cash outflow mainly related to the negativeoperating result for the six-month period. The Company showed a cashoutflow from investing activities for the first six months of 2009 of? 1,039 (2008: ? 4,045 cash outflow). A very significant part of thiscash outflow in both years related to investments in the Company'snew manufacturing facility. In the first six months of 2009, a totalof ? 5,393 of cash was generated through OctoPlus' financingactivities (first six months of 2008: ? 3,371 cash inflow). The 2009cash inflow mainly related to the funds received from the February2009 equity raising and the 2008 cash inflow mainly related to a ?3,481 bridge loans provided by Life Sciences Partners and S.R. One.The bridge loans increased to ? 4.5 million (including accumulatedinterest) in the beginning of 2009 and were converted into equity aspart of the February 2009 equity raising.Outlook second half-year 2009OctoPlus reiterates its prior full year guidance for revenues of ? 19million. The larger part of expenditures for restructuring andinvestments in the validation of the new manufacturing facility havebeen made and no similar activities are planned for the rest of theyear. Although the economic downturn has a significant impact on ourclients and may influence our ability to gain new business, theCompany aims to continue to grow the service business during the restof the year by increasing the amount of manufacturing work in the newfacility, and by pursuing additional drug delivery technologyevaluation contracts.Related party transactionsA number of existing shareholders and the Company's CEO Simon Sturgeparticipated in the February 2009 equity raising. After the equityraising was completed, OctoPlus' major shareholders comprised of:- Life Sciences Partners: 17.2%- S.R. One: 16.9%- Signet Healthcare Partners: 16.6%- Sodoro B.V., the personal holding company of Joost Holthuis, ChiefScientific Officer of OctoPlus: 10.2%- Innoven Partenaires: 9.3%- Fagus: 7.2%- SurModics: 4.9%The Company's CEO Simon Sturge participated in the financing andpurchased 133,333 shares (0.4%).In the Annual General Meeting of Shareholders on 23 April 2009, Mr.James Gale, Managing Partner at Signet Healthcare, was appointed tothe Board of Supervisory Directors. Due to his position withinSignet, Mr. Gale is not independent within the meaning of the DutchCorporate Governance Code.As per 1 April 2009, Mr. Hans Pauli, who was Chief Financial Officerand member of the Executive Board, left the Company.In May and June 2009, Mr. Joost Holthuis, Chief Scientific Officer,decreased his number of OctoPlus shares from 3.092.400 to 3.009.239,thereby decreasing his share in the Company to 10.0%.Auditor's involvementThe contents of this Interim Financial Report from the ExecutiveBoard and the Condensed Consolidated Interim Financial Statementshave not been audited or reviewed by an external auditor.Risks and uncertaintiesPages 23 to 25 of the Annual Report 2008 include an extensiveoverview of the Company's general business risks and specificindustry risks, specifically the risks associated with Locteron'sdevelopment success, intense competition, rapid technological change,significant product liability exposure, availability of fruitfulcollaborative relationships, enforceability of intellectual propertyrights, sustainable profitability, possible dilution of shareholders'ownership interest and the availability of additional capital.Responsibility statementAs required by section 5:25d of the Dutch Act on FinancialSupervision, each member of the Executive Board hereby confirms thatto the best of their knowledge:- the Condensed Consolidated Interim Financial Statements of theCompany for the first six-months of 2009 give a true and fair view ofthe assets, liabilities, financial position and result of the Companyand its consolidated activities;- the Interim Financial Report from the Executive Board for thefirst six months of 2009 gives a true and fair view of the Company'sposition and of the development and performance of the businessduring the first six months of 2009, and gives a fair description ofthe outlook for the rest of the year.Leiden, 6 August 2009Simon Sturge, Chief Executive OfficerGerben Moolhuizen, Chief Business OfficerJoost Holthuis, Chief Scientific Officerhttp://hugin.info/137076/R/1332957/315793.pdfThis announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.
Datum: 06.08.2009 - 07:30 Uhr
Sprache: Deutsch
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