Calypte Biomedical Corp. (ticker: CALY, exchange: NASDAQ) News Release - 27-Feb-2003
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Calypte Announces Fourth Quarter and Year-End Financial Results; Adds Planned Parenthood Golden Gate to Customer Base
ALAMEDA, Calif., Feb 27, 2003 (BUSINESS WIRE) -- Calypte Biomedical Corporation (OTCBB:CALY), the developer and marketer of the only two FDA-approved HIV-1 antibody tests that can be used on urine samples, as well as an FDA-approved serum HIV-1 antibody Western Blot supplemental test, announces financial results for the fourth quarter and year ended December 31, 2002.
Recent Highlights
During the second half of 2002 and in first part of 2003, Calypte's management team has moved forward with its objective to advance sales growth by increasing product distribution and gaining further acceptance in the marketplace. Recent highlights include:
-- Achieved sequential-quarterly revenue growth of 64% from $493,000 to $809,000 in the fourth quarter. -- As announced today, added Planned Parenthood Golden Gate to the growing list of customers utilizing Calypte's urine HIV-1 tests. As one of the larger Planned Parenthood affiliates, this relationship represents an excellent opportunity to demonstrate the benefits of urine testing to other Planned Parenthood chapters and similar organizations. -- Qualified for distribution in the state of California by PathNet Esoteric Laboratory Institute, which specializes in pathology, cytopathology and amplified esoteric sexually transmitted disease (STD) testing for numerous women's healthcare providers. Calypte and PathNet intend to work together to develop and implement outreach programs to notify PathNet's clients and other healthcare providers about the test availability. -- Received its first and second commercial orders from its Chinese distributor for a total of over 260,000 tests. The first order for 100,000 tests was received in October and shipped in December and the second order for 160,000 tests was received in January 2003, sooner than anticipated, and will be shipped in the next several weeks. -- Executed a Memorandum of Understanding with the Safe Blood for Africa Foundation to market and distribute Calypte's urine-based HIV-1 antibody tests and Serum Western Blot tests in sub-Saharan Africa. The tests are to be used as blood donor pre-screening tools in Safe Blood for Africa Foundation's mission to help prevent the spread of HIV/AIDS throughout 34 countries in sub-Saharan Africa. -- Joined the Community Healthcare Network's (CHN) menu of testing services. CHN, a not-for-profit organization, oversees a network of nine health care centers and three mobile vans, which reach over 60,000 individuals and their families in New York City annually. -- The U.S. Food and Drug Administration (FDA) eliminated the requirement for lot release testing for the Calypte HIV-1 Urine EIA, as the result of a demonstrated multi-year history of successful product manufacture. Elimination of the FDA lot release testing is expected to reduce the production-to-market time by two to eight weeks and decrease associated production costs without sacrificing any product quality. A similar elimination of FDA lot release testing for the Cambridge Biotech HIV-1 Urine Western Blot is also being sought by the company. -- Gained recognition for Calypte's test in a study led by Johns Hopkins University that concluded urine-based HIV screening can be an effective tool for identifying and treating infected persons in high-prevalence inner city communities, and leads to increased voluntary HIV testing versus testing for HIV with blood samples. The test was published in the December 2002 JAIDS Journal of Acquired Immune Deficiency Syndromes. -- Increased government relations expertise by hiring Dr. Richard George, a CDC and HIV veteran, to spearhead global programs to increase awareness of the importance of HIV testing, highlight the benefits of urine-based testing, develop HIV testing programs and secure capital to fund programs with public sector and government-sponsored agencies. -- Appointed Ms. Dian Harrison, CEO of Planned Parenthood Golden Gate Chapter, to the company's Board of Directors effective February 24, 2003. The company intends to utilize Ms. Harrison's experience educating and administering care in reproductive and general health issues.
"During the last quarter of 2002, we believe that our continued progress was evidenced by the increase in sequential revenue and our expanded distribution channels," stated Anthony Cataldo, executive chairman of Calypte. "We believe that in the first half of 2003, Calypte will continue to build its distribution channels and sign on new customers, to provide future growth. As these customers generally need approximately six months to ramp up and provide a normalized revenue, we hope to benefit during the second half of the year."
Nancy Katz, Calypte's president and chief executive officer, stated, "Calypte has also made important strides operationally. As Calypte already has FDA-approved manufacturing facilities, during a review of production goals for our Rapid HIV-1 Test, which is under development, we determined that we will manufacture the test internally. Thus, we plan to utilize our expertise and strict quality controls, and we expect to increase efficiencies and rate of production. As our decision to manufacture our proposed Rapid HIV-1 Test internally will require us to obtain the necessary funding to purchase equipment and materials as well as time to finalize product design, we have delayed our IDE submission. However, we believe this strategy and these initial capital investments will provide significantly greater long-term return and margins on the Rapid product once developed."
Cataldo continued, "Our long-term goal is to maximize the potential of our core urine-based testing solutions. We have built a foundation with our urine HIV-1 screening and confirmatory tests. Now, one of our highest priorities is to secure the necessary funding to complete our Rapid HIV-1 Urine Test IDE submission and to be able to meet our current manufacturing requirements for our FDA approved products. Upon filing the IDE, we intend to launch the Rapid Test internationally, which is our largest target market. At the same time, we intend to pursue FDA clearance to distribute the Rapid Test product domestically. We can begin clinical trials 30 days after our IDE submission, and from there we would anticipate receiving FDA clearance in 12-18 months, allowing 6-12 months for our trials and a maximum of 6 months for the FDA's review process. We will also simultaneously continue our research and development of tests in the areas of infectious and other diseases."
For the fourth quarter ended December 31, 2002, Calypte recorded revenues of $809,000, compared with $2.3 million in the fourth quarter of 2001. The net loss attributable to common stockholders for the quarter was approximately $6.3 million, or $0.05 per common share, compared with a net loss attributable to common stockholders of $1.2 million, or $0.03 per common share, for the three months ended December 31, 2001. The net loss for the fourth quarter ended December 31, 2002 included $3.6 million in non-cash charges related the grants of common stock and fully vested options and warrants as compensation for services that are included in selling, general and administrative expenses and non-cash interest expense. During the quarter ended December 31, 2001, there was less than $0.1 million in non-cash charges.
For the year-ended December 31, 2002, Calypte reported revenues of $3.7 million, compared with $6.8 million in 2001. The net loss attributable to common stockholders for 2002 was $13.4 million, or $0.17 per common share, compared with a net loss attributable to common stockholders of $9.2 million, or $0.30 per common share, for the year ended December 31, 2001. Calypte's 2002 operations and results were significantly impacted by the second quarter decision that resulted in an almost-complete wind down of its operations due to insufficient cash to fund continuing operations. This decrease also reflects lower revenues, increased non-cash-operating expenses, and an increase in non-cash interest expense related to the financings, offset by extraordinary income related to the extinguishment of debt. The net loss for the year-ended December 31, 2002 included $5.1 million in non-cash charges related to the grants of common stock and fully vested options and warrants as compensation for services that are included in selling, general and administrative expenses and non-cash interest expense. During the year ended December 31, 2001 these non-cash charges were approximately $1.6 million.
Calypte will hold a conference call today at 11:00 a.m. (ET), 8:00 a.m. (PT). Investors can access the call from the investor section of the Calypte web site, www.calypte.com. Investors in the U.S. and Canada interested in participating in the conference call may dial (877) 282-0743 and reference the Calypte Biomedical call. International investors may dial (703) 871-3073. Calypte recommends dialing into the call approximately 10 minutes prior to the scheduled start time. The webcast will be available until March 27, 2003. A telephone replay will be available through March 1, 2003 by calling (888) 266-2081. International callers should dial (703) 925-2533 for the replay. The replay confirmation code is 6411592.
About Calypte Biomedical
Calypte Biomedical Corporation, headquartered in Alameda, California, is a public healthcare company dedicated to the development and commercialization of urine-based diagnostic products and services for Human Immunodeficiency Virus Type 1 (HIV-1), sexually transmitted diseases and other infectious diseases. Calypte's tests include the screening EIA and supplemental Western Blot tests, the only two FDA-approved HIV-1 antibody tests that can be used on urine samples, as well as an FDA-approved serum HIV-1 antibody Western Blot test. The company believes that accurate, non-invasive urine-based testing methods for HIV and other infectious diseases may make important contributions to public health by helping to foster an environment in which testing may be done safely, economically, and painlessly. Calypte markets its products in countries worldwide through international distributors and strategic partners. Refer to current product package inserts for complete information on product performance characteristics.
Statements in this press release that are not historical facts are forward-looking statements within the meaning of the Securities Act of 1933, as amended. Those statements include statements regarding the intent, belief or current expectations of the Company and its management. Such statements reflect management's current views, are based on certain assumptions and involve risks and uncertainties. Actual results, events, or performance may differ materially from the above forward-looking statements due to a number of important factors, and will be dependent upon a variety of factors, including, but not limited to, our ability to obtain additional financing and access funds from our existing financing arrangements that will allow us to continue our current and future operations and whether demand for our product and testing service in domestic and international markets will continue and expand. The Company undertakes no obligation to publicly update these forward-looking statements to reflect events or circumstances that occur after the date hereof or to reflect any change in the Company's expectations with regard to these forward-looking statements or the occurrence of unanticipated events. Factors that may impact the Company's success are more fully disclosed in the Company's most recent public filings with the U.S. Securities and Exchange Commission ("SEC"), including its annual report on Form 10-K/A (No.3) for the year ended December 31, 2001 and its subsequent filings with the SEC.
CALYPTE BIOMEDICAL CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
Unaudited
Three Months Ended Year Ended
December 31, December 31,
----------------- -------------------
2002 2001 2002 2001
-------- -------- --------- ---------
Revenues:
Product sales $809 $2,347 $3,670 $6,826
-------- -------- --------- ---------
Cost of product sales 1,592 1,768 6,162 6,986
-------- -------- --------- ---------
Gross Margin (Loss) on
product sales (783) 579 (2,492) (160)
Other operating expenses:
Research and development
costs 289 344 929 1,546
Selling, general and
administrative costs 4,139 1,397 9,006 6,740
-------- -------- --------- ---------
Total other operating
expenses 4,428 1,741 9,935 8,286
-------- -------- --------- ---------
Loss from operations (5,211) (1,162) (12,427) (8,446)
Interest income - 1 3 9
Interest expense (114) (16) (331) (55)
Non-cash interest expense (880) - (1,875) (1,318)
Other income (expense) (17) 15 16 539
-------- -------- --------- ---------
Loss before income
taxes (6,222) (1,162) (14,614) (9,271)
Income taxes - - (2) (2)
-------- -------- --------- ---------
Net loss before
extraordinary item (6,222) (1,162) (14,616) (9,273)
Extraordinary gain on
extinguishment of debt, net of
income taxes - - 1,319 -
Extraordinary gain on
repurchase of beneficial
conversion feature, net of
income taxes - - - 145
-------- -------- --------- ---------
Net loss (6,222) (1,162) (13,297) (9,128)
Less dividends on mandatorily
redeemable Series A preferred
stock (30) (30) (120) (120)
-------- -------- --------- ---------
Net loss attributable to common
stockholders $(6,252) $(1,192) $(13,417) $(9,248)
======== ======== ========= =========
Net loss per share attributable
to common stockholders (basic
and diluted) $(0.05) $(0.03) $(0.17) $(0.30)
======== ======== ========= =========
Weighted average shares used to
compute net loss per share
attributable to common
stockholders (basic and
diluted) 121,613 35,527 77,737 30,928
======== ======== ========= =========
CALYPTE BIOMEDICAL CORPORATION AND SUBSIDIARY
CONSOLIDATED BALANCE SHEET DATA
(in thousands)
Unaudited
December 31, December 31,
2002 2001
------------ -------------
Cash and cash equivalents $147 $287
Working capital (3,887) (4,289)
Total Assets 3,297 4,262
Current notes payable, net of
discount 519 411
Long-term portion of capital
lease obligations 13 22
Non-current convertible notes and
debentures, net of discount of $2,638 at
December 31, 2002 1,662 -
Mandatorily redeemable Series A
preferred stock 2,576 2,456
Total stockholders' equity (7,494) (5,500)
CONTACT: Calypte Biomedical Corporation
Richard Brounstein, 510/749-5156 (CFO, Company Contact)
rbrounstein@calypte.com
www.calypte.com
or
Lippert/Heilshorn & Associates
Brendan Lahiff/Kirsten Chapman, 415/433-3777 (IR Contact)
brendan@lhai-sf.com
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