IDBE ID Biomedical - Common Shares (MM)

VANCOUVER, Aug. 15 /PRNewswire-FirstCall/ -- ID Biomedical Corporation (TSX: IDB; NASDAQ: IDBE) announced today financial results for the quarter ended June 30, 2005. Amounts, unless specified, are expressed in Canadian dollars. Commenting on the second quarter, Todd Patrick, President of ID Biomedical said, "The Company is on track and progressing toward our goal of filing a Biologics License Application (BLA) with the U.S. Food and Drug Administration for our injectable influenza vaccine by year-end. The filing of the BLA is the key objective for the Company and the level of expenditures for the quarter reflects our support for this project and is in-line with our expectations. Going forward, we expect our expenditures to increase as we begin confirmatory efficacy studies for our injectable influenza vaccine and our other programs continue to advance in clinical development." The Company's second quarter financial report will be available on our web site and at http://www.sedar.com/. Highlights of the Company's progress during the second quarter and a general company update will be discussed on a conference call/web cast to be held Monday, August 15 at 5:00 pm Eastern. The presentation can be accessed by dialing 604-677-8677 or at http://www.newswire.ca/en/webcast/viewEvent.cgi?eventID(equal sign)1204060. A recording of the call will be available until August 29th by dialing 416-640-1917 and entering the code 21133330 followed by the number sign. CONDENSED FINANCIAL RESULTS The Company recorded a net loss of $32.5 million ($0.75 per share) for the three months ended June 30, 2005 compared to a net loss of $10.9 million ($0.26 per share) for the three months ended June 30, 2004. The net loss for the six months ended June 30, 2005 was $60.1 million ($1.40 per share), compared to a net loss of $21.8 million ($0.52 per share) for the same period in 2004. The results from operations include the activities of the acquired vaccine business from Shire beginning September 10, 2004. For the three months ended June 30, 2005, the Company's revenue totaled $13.0 million compared to $2.7 million for the three months ended June 30, 2004. Revenue for the six months ended June 30, 2005 was $25.8 million compared to $4.3 million for the same period in 2004. Product sales revenue in the amount of $7.6 million and $14.5 million was recorded for the three and six months ended June 30, 2005 respectively. There were no product sales for the three and six months ended June 30, 2004. This product sales revenue primarily relates to the sales of the Company's NeisVac-C vaccine to the Canadian government. The Company had no product sales prior to the acquisition of Shire. Research and development contract revenue in the amount of $3.9 million was recorded for the three months ended June 30, 2005 compared to $2.0 million for the three months ended June 30, 2004. Research and development contract revenue for the six months ended June 30, 2005 was $8.3 million compared to $2.9 million for the same period in 2004. Research and development contract revenue includes revenue recognized as a result of the Shire Funding Facility to support the research and development of the non-flu vaccine candidates acquired from Shire. Revenue recognized from the Shire Funding Facility totaled $3.5 million and $7.8 million for the three and six months ended June 30, 2005 respectively. The Company determined that these amounts are appropriate to recognize as research and development contract revenue since the amount and date of repayment of these advances are not known at this time. Other research and development contract revenue totaled $0.4 million and $0.5 million for the three and six months ended June 30, 2005 respectively compared to $2.0 million and $2.9 million for the same periods in 2004. Other research and development contract revenue is a result of agreements executed during 2003 with Dynport Vaccine Company for the development of an antigen for an injectable subunit plague vaccine. Previously deferred licensing revenue in the amount of $0.7 million was recognized for the three months ended June 30, 2005, compared to $0.7 million for the same period in 2004. Deferred licensing revenue recognized for the six months ended June 30, 2004 was $1.4 million compared to $1.4 million for the same period in 2004. Based on the Company's current licensing agreements, amortization of deferred licensing revenue is expected to continue at the present amount through October 2006. The amortization of deferred licensing revenue does not result in additional cash to the Company. Other revenue, consisting primarily of the pandemic readiness fees under an agreement with the Government of Canada and other fees to store and distribute vaccines under an agreement with the Quebec Ministry of Health, totaled $0.7 million and $1.6 million for the three and six months ended June 30, 2005 respectively compared to $0 for the same periods in 2004. Other revenue increased as a result of the Shire acquisition. Cost of product sales for the three and six months ended June 30, 2005 includes the expenses related to the distribution of NeisVac-C, costs related to pandemic readiness fees classified as other revenue, and other revenue related costs. Cost of product sales was $6.9 million and $13.1 million for the three and six months ended June 30, 2005 respectively compared to $0 for the same periods in 2004. Prior to the acquisition of Shire, the Company did not have any cost of products sales. Research and development expenses increased $15.3 million or 188%, to $23.5 million for the three months ended June 30, 2005 compared to the three months ended June 30, 2004. Research and development expenses for the six months ended June 30, 2005 increased 150% to $45.8 million compared to the same periods in 2004. The increase in research and development expenses in 2005, compared to the same periods in 2004, is a result of the clinical development programs acquired from Shire, predominantly the costs being incurred in support of the U.S. licensure of the Company's injectable influenza vaccine. Also impacting research and development expenses is the clinical cost associated with advancing our other lead development programs, and the funding of our early stage development programs. Included in research and development expenses is stock-based compensation expense totaling $1.1 million and $2.2 million for the three and six months ended June 30, 2005 respectively compared to $0.4 million and $1.0 million for the same periods in 2004. Research and development tax credits and grants include amounts received or receivable from Technology Partnerships Canada ("TPC"), National Institutes of Health ("NIH") and provincial government investment tax credits. Research and development tax credits and grants were $2.5 million and $4.0 million for the three and six months ended June 30, 2005 respectively compared to $0.2 million and $0.5 million for the same periods in 2004. There were $0.4 million and $0.7 million in TPC grants recognized for the three and six months ended June 30, 2005 respectively compared to $0 million for the three and six months ended June 30, 2004. NIH grants totaled $1.9 million and $2.8 million for the three and six months ended June 30, 2005. There were no NIH grants during the three and six months ended June 30 2004. Provincial government investment tax credits totaled $0.3 million and $0.6 million for the three and six months ended June 30, 2005 as compared to $0.2 million and $0.5 million for the same periods in 2004. Selling, general and administrative expenses increased $5.9 million, or 216% to $8.7 million for the three months ended June 30, 2005 compared to the three months ended June 30, 2004. Selling, general and administrative expenses for the six months ended June 30, 2005 increased $10.6 million, or 210% to $15.6 million compared to the same period in 2004. This increase is primarily the result of the selling and administrative cost acquired in the Shire acquisition. Also contributing to the increase is cost related to our Sarbanes-Oxley reporting compliance and stock-based compensation. Stock-based compensation expense associated with selling, general and administrative personnel totaled $2.8 million and $4.0 million for the three and six months ended June 30, 2005 respectively compared to $0.5 million and $0.9 million for the same periods in 2004. Depreciation and amortization expense relates to facilities and equipment and medical technology and other assets. Depreciation and amortization expense increased $3.0 million, or 263% to $4.2 million for the three months ended June 30, 2005 compared to the three months ended June 30, 2004. Depreciation and amortization for the six months ended June 30, 2005 increased $5.9 million, or 261% to $8.1 million compared to the same period in 2004. These increases are directly related to the value of the assets acquired in the Shire acquisition. Investment income increased $0.4 million to $0.9 million for the three months ended June 30, 2005 compared to the three months ended June 30, 2004. Investment income for the six months ended June 30, 2005 increased $0.3 million compared to the same period in 2004. The Company recorded a foreign exchange loss of $0.9 million for the three months ended June 30, 2005 as compared to a loss of $2.3 million for the three months ended June 30, 2004. For the six months ended June 30, 2005 the Company recorded a foreign exchange loss of $0.4 million compared to a loss of $2.3 million for the same period in 2004. This foreign exchange loss is a result of the U.S. denominated Shire Funding Facility related to flu advances and the financing transaction used to repurchase the Shire subscription receipts, less gains related to cash and cash equivalents held in U.S. dollars. The Company recorded interest expense and other finance charges of $4.4 million for the three months ended June 30, 2005 compared to $0.01 million for the three months ended June 30, 2004. For the six months ended June 30, 2005 the Company recorded interest expense and other finance charges of $8.3 million compared to $0.02 million for the same period in 2004. The increase in interest expense and other finance charges is a direct result of the flu advances, received under the Shire Funding Facility, and the interest expense and finance charges associated with the loan payable that preceded the repurchase of the Shire subscription receipts financing transaction that closed on January 5, 2005. The Company recorded a loss on disposal of facilities and equipment of $0.3 million for the three and six months ended June 30, 2005 as compared to 0 for the same periods in 2004. This loss reflects the write-off of leasehold improvements of a facility that the Company has available for sub-leasing. Consolidated Balance Sheets (Expressed in Canadian dollars) June 30, 2005 and December 31, 2004 ------------------------------------------------------------------------- June 30, December 31, 2005 2004 (Unaudited) (Audited) Assets Cash and cash equivalents $113,296,553 $105,068,973 Other current assets 45,966,691 44,611,681 ------------------------------------------------------------------------- 159,263,244 149,680,654 Long-term receivable 400,466 468,278 Facilities and equipment 158,746,739 186,110,643 Investment 413,644 413,644 Medical technology and other assets 31,424,582 33,358,944 Deferred charges 925,620 - Goodwill 771,314 771,314 ------------------------------------------------------------------------- $351,945,609 $370,803,477 ------------------------------------------------------------------------- Liabilities and Shareholders' Equity ------------------------------------------------------------------------- Current liabilities $ 96,166,851 $ 95,978,227 Deferred revenue 9,394,998 11,101,339 Long-term debt 138,806,043 37,043,350 Obligation under capital lease 2,724 18,444 Shareholders' equity 107,574,993 226,662,117 ------------------------------------------------------------------------- $351,945,609 $370,803,477 ------------------------------------------------------------------------- Consolidated Statements of Operations (Expressed in Canadian dollars) For the three and six months ended June 30, 2005 and 2004 ------------------------------------------------------------------------- Three months ended June 30 Six months ended June 30 ------------------------------------------------------- 2005 2004 2005 2004 ------------------------------------------------------------------------- (Unaudited) (Unaudited (Unaudited) (Unaudited - Restated) - Restated) Revenue: Product sales $ 7,619,105 $ - $ 14,494,644 $ - Research and development contracts 3,940,111 2,046,601 8,256,479 2,889,768 Licensing 683,089 688,683 1,372,091 1,378,942 Other 746,340 - 1,627,706 - ------------------------------------------------------------------------- 12,988,645 2,735,284 25,750,920 4,268,710 Expenses and other: Cost of product sales 6,904,800 - 13,100,105 - Research and development 23,515,694 8,169,824 45,763,769 18,308,838 Research and development tax credits and grants (2,505,687) (188,057) (4,036,271) (466,604) Selling, general and administrative 8,653,254 2,740,657 15,646,362 5,040,561 Depreciation and amortization 4,203,512 1,158,193 8,096,510 2,245,017 ------------------------------------------------------------------------- $ 40,771,573 $ 11,880,617 $ 78,570,475 $ 25,127,812 ------------------------------------------------------------------------- Loss from operations (27,782,928) (9,145,333) (52,819,555) (20,859,102) Other income (expenses): Investment income 941,001 579,833 1,785,647 1,485,593 Foreign exchange gain (loss) (934,788) (2,330,960) (429,107) (2,342,776) Interest expense and other finance charges (4,422,628) (8,522) (8,298,191) (20,678) Loss on disposal of facilities and equipment (340,104) - (340,104) - Loss on disposal of medical technology and other assets - - - (26,744) ------------------------------------------------------------------------- (4,756,519) (1,759,649) (7,281,755) (904,605) ------------------------------------------------------------------------- Loss before income taxes (32,539,447) (10,904,982) (60,101,310) (21,763,707) Income taxes - - - - ------------------------------------------------------------------------- Loss for the period $(32,539,447) $(10,904,982) $(60,101,310) $(21,763,707) ------------------------------------------------------------------------- Basic and diluted loss per common share $ (0.75) $ (0.26) $ (1.40) $ (0.52) ------------------------------------------------------------------------- Weighted average number of shares outstanding 43,143,951 41,973,984 42,958,878 41,969,262 ------------------------------------------------------------------------- Consolidated Statements of Cash Flows (Expressed in Canadian dollars) For the three and six months ended June 30, 2005 and 2004 ------------------------------------------------------------------------- Three months ended June 30 Six months ended June 30 ------------------------------------------------------- 2005 2004 2005 2004 ------------------------------------------------------------------------- (Unaudited) (Unaudited (Unaudited) (Unaudited - Restated) - Restated) Cash provided by (used in) operations: Loss for the period $(32,539,447) $(10,904,982) $(60,101,310) $(21,763,707) Items not affecting cash 14,943,802 2,076,993 23,472,247 4,196,031 Net changes in non-cash working capital balances (15,231,829) (2,432,987) (9,515,593) (5,033,589) ------------------------------------------------------------------------- Cash used in operating activities (32,827,474) (11,260,976) (46,144,656) (22,601,265) Cash provided by (used in) investment activities (17,091,628) 2,806,897 20,929,464 3,930,049 Cash provided by financing activities 13,065,971 12,884 33,442,772 156,210 ------------------------------------------------------------------------- Increase (decrease) in cash and cash equivalents (36,853,131) (8,441,195) 8,227,580 (18,515,006) Cash and cash equivalents, beginning of period 150,149,684 139,013,838 105,068,973 149,087,649 ------------------------------------------------------------------------- Cash and cash equivalents, end of period $113,296,553 $130,572,643 $113,296,553 $130,572,643 ------------------------------------------------------------------------- ------------------------------------------------------------------------- About ID Biomedical ID Biomedical is an integrated biotechnology company dedicated to the development of innovative vaccine products. It operates in research, development, manufacturing, sales and marketing from its facilities in Canada and in the United States. ID Biomedical is dedicated to becoming a premier vaccine company with significant marketed products worldwide and an extensive pipeline in both clinical and preclinical development. ID Biomedical has a leading position in the Canadian influenza vaccine market. It received a ten-year mandate from the Government of Canada in 2001 to assure a state of readiness in the case of an influenza pandemic and provide influenza vaccine for all Canadians in such an event. It also currently supplies approximately 75% of the Canadian government's influenza vaccine purchases. For further information on ID Biomedical, please visit the Company's website at http://www.idbiomedical.com/. (x) NeisVac-C is a trademark of Baxter International Inc. and is used under license. The information in this news release contains so-called "forward-looking" statements. These include statements regarding ID Biomedical's expectations and plans relating to the integration of the vaccine business acquired from Shire, statements about ID Biomedical's expectations, beliefs, intentions or strategies for the future, which may be indicated by words or phrases such as "anticipate", "expect", "intend", "plan", "will", "we believe", "ID Biomedical believes", "management believes", and similar language. All forward-looking statements are based on ID Biomedical's current expectations and are subject to risks and uncertainties and to assumptions made. Important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements include: (i) the company's ability to successfully integrate the Shire vaccine business; (ii) the company's ability to successfully complete preclinical and clinical development of its products; (iii) the company's ability to manufacture its products; (iv) the seasonality of the flu-vaccine business and related fluctuations in the company's revenues from quarter to quarter; (v) decisions, and the timing of decisions, made by the health regulatory agencies regarding approval of its products for human testing; (vi) the company's ability to enter into distribution agreements for its products, and to complete and maintain corporate alliances relating to the development and commercialization of its technology and products; (vii) market acceptance of its technologies and products; and (viii) the competitive environment and impact of technological change and other risks detailed in the company's filings with the Securities and Exchange Commission. ID Biomedical bases its forward-looking statements on information currently available to it, and assumes no obligation to update them. For further information, please contact: Investor Relations/Media: Dean Linden Michele Roy (604) 431-9314 (450) 978-6313 DATASOURCE: ID Biomedical Corporation CONTACT: Investor Relations, Media: Dean Linden, (604) 431-9314, ; Michele Roy, (450) 978-6313, ; To request a free copy of this organization's annual report, please go to http://www.newswire.ca/ and click on reports@cnw.

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