Major events since the beginning of 2010: - Arnd Christ appointed Chief Financial Officer of MediGene AG in April 2010 - Veregen(R) launched by Abbott in Germany and Austria; commercialization effort in the USA extended by Nycomed - Additional Veregen(R) marketing partnerships concluded in Israel, Greece & Cyprus, China, and South Korea - Phase II clinical trial of EndoTAG(TM)-1 for the treatment of triple negative breast cancer successfully completed - European rights to Eligard(R) sold to Astellas for EUR 25 million in near-term cash payments plus ongoing royalties - Restructuring and rightsizing of MediGene AG concluded Arnd Christ, CFO of MediGene AG commented: "In the last several months we have taken substantial steps to ensure the strength of our company, including the monetization of our Eligard(R) rights and the restructuring measures we implemented recently. The resulting solid financial profile has put us in an excellent position to assess strategic options to drive both future growth and sustained enhancement of shareholder value". Result of the first nine months of 2010: In the first nine months of 2010, MediGene increased total revenue by 24% to EUR35.3million (9m 2009:EUR28.6 million). Revenue was generated almost entirely from product sales and income from royalties received from the marketed drugs Eligard(R) and Veregen(R). The loss on an EBITDA basis was reduced by 27% to EUR-9.6 million (9m 2009:EUR-13.1 million) in the first nine months of 2010. The net loss also decreased significantly by 48% to EUR-8.2 million compared to last year's reporting period (9m 2009:EUR-15.9 million). The improved operating result is due mainly to increased revenues and reduced research and development expenses. Operating expenses totaled EUR-17.6 million in the first nine months of 2010 (9m 2009:EUR-19.8 million), and include non-recurring restructuring cost of EUR 1.0 million. Cash and cash equivalents on September 30, 2010 totaled EUR10.8 million (December 31, 2009: EUR12.3 million). In the third quarter of 2010, MediGene obtained a EUR5million payment from Astellas from the sale of the sales and marketing rights to Eligard(R). This payment is included in the balance sheet but has yet to be reflected in the P&L. It will be recognized as income upon conclusion of the transfer of Eligard(R) EU rights to Astellas. The average monthly operating cash burn rate amounted to EUR-0.6 million (9M 2009: EUR-1.7 million). In the third quarter of 2010, no further capital was called from the company's Standby Equity Distribution Agreement. In the first nine months of 2010 a total of EUR4.5million was called under this agreement. Forecast 2010: MediGene hereby updates its previous financial and operational forecasts for the current fiscal year. Financial forecast 2010: In 2010 MediGene expects revenue totaling EUR 47 to 49 million, which represents a slight increase from the previous revenue forecast (previous forecast:transfer of Eligard(R) rights in 2010: EUR 55 to 65 million; transfer of rights in 2011: EUR 44 to 48 million). MediGene and Astellas have agreed that the transfer of the Eligard(R) rights for the EU countries will take place on March 1, 2011. Upon transfer, the second tranche of EUR 15 million will become due for payment, and will consequently be recognized affecting net income in the first quarter of 2011. The loss on an EBITDA basis in 2010 is expected to be in the range of EUR -12 to -14 million. MediGene now expects a lower net cash burn from operating activities than it had previously forecast. The forecast for net cash burn from activities in 2010 is now expected to be EUR11to 13 million (previous forecast:EUR 14 to 17 million). In 2011 MediGene expects a significant inflow of cash. Based on the current business plan, MediGene's corporate financing is therefore secured beyond the end of 2011. Eligard(R): MediGene anticipates a continued rise in the Eligard(R) market share in Europe and a subsequent increase in overall sales in 2010. Even after the complete transfer of the Eligard(R) rights to Astellas during 2011, MediGene will benefit from this positive trend. Veregen(R): In February 2010, MediGene's US marketing partner Nycomed increased its sales force for the commercialization of Veregen(R) to more than 40 persons. The launches in Germany and Austria by Abbott represent the initial roll-out of the ointment in Europe. MediGene expects in-market sales for Veregen to total EUR 6 million in 2010, representing significant growth over last year (2009:EUR). Going forward, MediGene intends to conclude further partnership agreements to continue its global licensing strategy. EndoTAG(TM)-1: |
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