Compugen Ltd. (NASDAQ:CGEN) today reported its results for the
second quarter ending June 30, 2008. Compugen President and CEO Mr.
Alex Kotzer stated, �During this past quarter, the diversity of our
unique prediction-based discovery efforts continued to be
demonstrated with the disclosure of successful experimental
validation results for novel biomarkers for the early preclinical
detection of drug-induced kidney toxicity, for more than 10 drug
target candidates for cancer antibody therapeutics, for a
therapeutic peptide candidate for immune related diseases and for
three G-Protein coupled receptor (GPCR) ligands.� Mr. Kotzer
continued, �More recently, Compugen announced the successful
completion of in vitro and in vivo validation tests for CGEN-50001,
a drug that has been marketed for many years in Europe for central
nervous system indications such as depression. In these recently
completed studies, the drug, which is neither marketed nor approved
for usage in the US, was shown to significantly increase the effect
of Tamoxifen, a frequently used drug for the treatment of estrogen
receptor (ER) positive breast cancer. The beneficial impact of
administering CGEN-50001 in this completely unrelated and very
major medical condition was initially predicted in silico by our
New Indications Discovery Platform. CGEN-50001 was then selected
for further validation. Following the positive results, we are now
planning a proof of concept human trial for this new usage as well
as evaluating other drugs with potential new usages that have been
predicted by this very powerful platform.� Compugen also announced
today the appointment of Ms. Dikla Czaczkes Axselbard as chief
financial officer, succeeding Ms. Ronit Lerner who resigned from
the Company. Ms. Czaczkes Axselbard served as director of finance
for Compugen from 2002 through 2007, and as acting CFO since
February 2008. Prior to joining Compugen, Ms. Czaczkes Axselbard
was chief financial officer of Packet Technologies Ltd, a mobile
internet security hardware and software startup company and before
that an audit manager at Ernst & Young Israel. She holds an MBA
in finance and a BA in accounting and economics, both from the Tel
Aviv University, and is a certified public accountant in Israel.
Revenues for the second quarter of 2008 were $40,000 and for the
six months ended June 30, 2008, were $321,000. No revenues were
reported for either of the comparable periods of 2007. The net loss
for the most recent quarter was $3.0 million (including a non-cash
expense of $416,000 related to stock based compensation) or $0.10
per share, compared with a net loss of $3.2 million (including a
non-cash expense of $436,000 related to stock based compensation),
or $0.11 per share, for the corresponding quarter of 2007. The net
loss for the first six months of 2008 was $5.5 million (including a
non-cash expense of $743,000 related to stock based compensation),
or $0.19 per share, compared with a net loss of $6.3 million
(including a non-cash expense of $1.2 million related to stock
based compensation), or $0.22 per share, for the same period in
2007. Research and development expenses of $2.4 million for the
second quarter of 2008, compared to $2.3 million for the second
quarter of 2007, remain the Company�s largest expense, representing
approximately 70% of total expenses. These amounts are before the
deduction of governmental and other grants, which totaled $169,000
for the second quarter ended June 30, 2008, compared with $293,000
for the corresponding quarter in 2007. In view of the increase in
the market value of the Company�s holding in Evogene Ltd, this
amount is now shown as a separate line item in the Company�s
consolidated balance sheets and was $4.6 million as of June 30,
2008 compared to $510,000 at year end 2007. Previously, the
Company�s holding in Evogene was included in Other Assets. As of
June 30, 2008, Compugen had $12.6 million in cash, cash
equivalents, deposits and marketable securities, a decrease of $4.6
million from the $17.2 million reported as of December 31, 2007.
Conference Call and Webcast Information Compugen will hold a
conference call to discuss its second quarter results on Tuesday,
July 29, 2008 at 10:00 a.m. EDT. To access the conference call,
please dial 1-866-345-5855 from the US or +972-3-918-0688
internationally. The call will also be available via live webcast
through Compugen�s Website, located at www.cgen.com. A replay of
the conference call will be available approximately two hours after
the completion of the live conference call. To access the replay,
please dial 1-888-326-9310 from the US or +972-3�925-5944. The
replay will be available until 12 noon EDT on August 1, 2008. About
Compugen Compugen�s mission is to be the world leader in the
discovery and licensing of product candidates to the drug and
diagnostic industries under milestone and revenue sharing
agreements. The Company�s increasing inventory of powerful and
proprietary discovery platforms is enabling the predictive
discovery � field after field � of numerous therapeutic and
diagnostic product candidates. These discovery platforms are based
on the Company�s decade-long focus on the predictive understanding
of important biological phenomena at the molecular level.
Compugen�s current collaborations include Biosite, Medarex, Inc.,
Merck & Co., Inc., Ortho-Clinical Diagnostics (a Johnson &
Johnson company), Roche, Siemens Healthcare Diagnostics, Inc., and
Teva Pharmaceutical Industries. In 2002, Compugen established an
affiliate, Evogene Ltd. (TASE:EVGN.TA), to utilize the Company�s
in-silico predictive discovery capabilities in the agricultural
biotechnology field. For additional information, please visit
Compugen's corporate Website at www.cgen.com and Evogene�s
corporate Website at www.evogene.com. This press release may
contain "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. These statements
include words such as �may�, �expects�, �anticipates�, �believes�,
and �intends�, and describe opinions about future events. These
forward-looking statements involve known and unknown risks and
uncertainties that may cause the actual results, performance or
achievements of Compugen to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements. Some of these risks are: changes in
relationships with collaborators; the impact of competitive
products and technological changes; risks relating to the
development of new products; and the ability to implement
technological improvements. These and other factors are identified
and more fully explained under the heading "Risk Factors" in
Compugen's annual reports filed with the Securities and Exchange
Commission. COMPUGEN LTD. CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (U.S. dollars in thousands, except for share and
per-share amounts) � � Three Months Ended June 30, � Six Months
Ended June 30, 2008 Unaudited � 2007 Unaudited 2008 Unaudited �
2007 Unaudited � Revenues 40 - 321 - � Cost of revenues - - 7 -
Research and development expenses 2,378 2,324 4,309 4,662 Less:
governmental and other grants (169 ) (293 ) (335 ) (590 ) Research
and development expenses, net 2,209 2,031 3,974 4,072 Sales and
marketing expenses 355 272 663 866 General and administrative
expenses 700 623 1,514 1,176 Total operating expenses (a) 3,264
2,926 6,151 6,114 � Operating loss (3,224 ) (2,926 ) (5,837 )
(6,114 ) Financing income, net 259 227 361 503 Other income 11 5 27
14 Net loss from continuing operations (2,954 ) (2,694 ) (5,449 )
(5,597 ) Loss from discontinued operations (13 ) (464 ) (13 ) (668
) Net loss (2,967 ) (3,158 ) (5,462 ) (6,265 ) Basic and diluted
loss per ordinary share from continuing operations (0.10 ) (0.09 )
(0.19 ) (0.20 ) Basic and diluted loss per ordinary share from
discontinued operations - (0.02 ) - (0.02 ) Basic and diluted net
loss per ordinary share (0.10 ) (0.11 ) (0.19 ) (0.22 ) Weighted
average number of ordinary shares outstanding 28,395,118 28,242,570
28,372,204 28,220,723 � (a) Includes stock based compensation
COMPUGEN LTD. CONDENSED CONSOLIDATED BALANCE SHEETS DATA (U.S.
dollars, in thousands) � � June 30, 2008 Unaudited December 31,
2007 Audited � ASSETS Current assets Cash, cash equivalents, short
term deposits and marketable securities 12,513 15,082 Cash held in
favor of other consortium partners 837 118 Trade receivables 44 40
Receivables and prepaid expenses 634 950 Assets related to
discontinued operation 3 54 Total current assets 14,031 16,244 �
Long-term investments Long term deposits and marketable securities
- 2,080 Investment in Evogene 4,644 510 Other assets 1,769 1,415
Property and equipment, net 1,217 1,417 Total assets 21,661 21,666
� LIABILITIES AND SHAREHOLDERS� EQUITY Current liabilities Accounts
payable and accrued expenses 2,813 2,741 Deferred revenues 100 150
Liabilities related to discontinued operations 16 4 Total current
liabilities 2,929 2,895 � Long-term liabilities Accrued severance
pay 1,912 1,486 Other long-term liabilities 20 - Total long-term
liabilities 1,932 1,486 � Total shareholders� equity 16,800 17,285
Total liabilities and shareholders� equity 21,661 21,666
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