SOURCE: Agennix AG

Agennix AG

November 23, 2009 02:48 ET

Agennix AG Reports Financial Results for Third Quarter and First Nine Months of 2009

MARTINSRIED/MUNICH, GERMANY and PRINCETON, NJ and HOUSTON, TX--(Marketwire - November 23, 2009) -

Agennix AG (FRANKFURT: AGX) (XETRA: AGX) today announced financial results for the third quarter and first nine months ended September 30, 2009.

Agennix AG was formed by the combination of GPC Biotech AG and Agennix Incorporated. The accounting for the business combination will be based on the acquisition method specified in IFRS 3, Business combinations (revised 2008). Based on that accounting treatment, GPC Biotech AG has been identified as the acquirer and Agennix Incorporated as the acquiree in this transaction. Therefore, the historical financial information of Agennix AG, including the information presented below, is that of GPC Biotech AG. Furthermore, for future financial reports, the comparative historical financial information will be that of GPC Biotech AG for the respective comparative periods.

First nine months of 2009 compared to first nine months of 2008

Revenues decreased 98% to EUR 0.3 million for the nine months ended September 30, 2009, compared to EUR 12.3 million for the same period in 2008. The decrease in revenues is due to the termination of the co-development and license agreement for satraplatin with Celgene Corporation. The termination became effective in September 2008 and resulted in the recognition as revenue of the unamortized portion of the original upfront license fees of EUR 7.2 million and EUR 1.9 million of the aggregate pre-payments for R&D expenses in the third quarter of 2008.

Research and development (R&D) expenses for the nine months ended September 30, 2009, decreased 71% to EUR 3.9 million compared to EUR 13.4 million for the same period in 2008. The decrease in R&D expenses is primarily due to 1) a decrease in clinical trial costs due to reduced clinical trial volumes; 2) staff reductions as a result of the restructuring plans implemented in the first quarter of 2008 and 2009; and 3) a credit to compensation cost totalling EUR (1.5) million as a result of the forfeiture of convertible bonds and stock options.

In the first nine months of 2009, administrative expenses decreased 22% to EUR 8.0 million compared to EUR 10.3 million for the same period in 2008. The decrease in administrative expenses is primarily due to staff reductions and other associated activities as a result of restructuring plans. The total decrease of EUR (2.3) million is net of a credit to compensation cost totaling EUR (1.7) million as a result of the forfeiture of convertible bonds and stock options, as well as an increase of approximately EUR 3.3 million in one-time costs relating to banking fees, legal services, audit and other related services in connection with the merger into Agennix AG, which closed on November 5, 2009.

Net loss for the first nine months of 2009 improved 13% to EUR (10.6) million compared to EUR (12.2) million for the first nine months of 2008.

Basic and diluted loss per share was EUR (0.29) for the first nine months of 2009 compared to EUR (0.33) for the same period in 2008.

Cash position and net cash burn

As previously disclosed, the Company reported that Agennix AG's cash and cash equivalents position (pro forma) at September 30, 2009 was EUR 17.9 million.

As of September 30, 2009 cash, cash equivalents, and available-for-sale investments for GPC Biotech AG totaled EUR 2.9 million (December 31, 2008: EUR 32.0 million), including EUR 0.2 million in restricted cash.

Net cash burn for the first nine months of 2009 was EUR 15.5 million, with net cash burn of EUR 4.9 million in the first quarter, EUR 6.5 million in the second quarter and EUR 4.1 in the third quarter of 2009. The decrease in net cash burn for the third quarter compared to the second quarter was mainly due to payments made in the second quarter totaling EUR 2.7 million for amounts accrued in the first quarter of 2009 relating to the merger. Net cash burn is derived by adding net cash used in operating activities and purchases of property, equipment and intangible assets. The figures used to calculate net cash burn are contained in the Company's interim consolidated cash flow statement for the respective periods.

Comparison to previous year: third quarter 2009 compared to third quarter 2008

Revenues for the three months ended September 30, 2009, decreased 98% to EUR 0.2 million compared to EUR 9.3 million for the same period in 2008. R&D expenses decreased 58% for the three months ended September 30, 2009, to EUR 1.3 million compared to EUR 3.1 million for the same period in 2008. Administrative expenses for the third quarter of 2009 decreased 45% to EUR 1.6 million compared to EUR 2.9 million for the same quarter in 2008. Net loss for the third quarter of 2009 was EUR (2.1) million compared to net income of EUR 3.5 million for the third quarter of 2008. Basic and diluted (loss)/income per share was EUR (0.06) and EUR 0.10 for the third quarter of 2009 and 2008, respectively.

Quarter over quarter results: third quarter 2009 compared to second quarter 2009

Revenues increased 100% to EUR 0.2 million for the third quarter of 2009 compared to EUR 0.1 for the previous quarter. R&D expenses decreased 7% to EUR 1.3 million for the third quarter of 2009 compared to EUR 1.4 million in the second quarter of 2009. Administrative expenses for the third quarter of 2009 decreased 33% to EUR 1.6 million compared to EUR 2.4 million for the previous quarter. The Company's net loss was EUR (2.1) million in the third quarter of 2009, compared to a net loss of EUR (4.2) million for the previous quarter. Basic and diluted loss per share was EUR (0.06) for the third quarter of 2009 compared to a loss per share of EUR (0.11) for the previous quarter.

Torsten Hombeck, Ph.D., Chief Financial Officer, said: "We are very excited that the merger has closed and we are now operating as a single company, working together as one team to develop our product candidates to treat cancer. With the merger successfully completed, we are focused on pursuing partnerships for our drug development programs, particularly talactoferrin, as well as considering different possible near-term financing options in order to ensure that we have sufficient funding to advance these programs."

Financial guidance

The Company updated its guidance for the full year 2009 and 2010 as follows:

Revenues: The Company does not expect to generate substantial cash revenues for the remainder of 2009 nor for 2010. This assumption does not consider cash revenue from potential partnership(s) for the Company's product candidates due to the uncertainty of the completion and timing of such events.

R&D expenses: For the remainder of 2009 and for 2010, the Company expects R&D expenses to significantly increase compared to 2008 due to an expected steady increase in clinical trial-related costs as the Company's Phase 3 trials with talactoferrin progress.

Administrative expenses: Excluding one-time expenses associated with the merger, the Company believes that administrative expenses for the remainder of 2009 and for 2010 will increase slightly compared to 2008, primarily due to the slight increase in G&A headcount as a result of the merger.

Cash position: The Company believes it will have sufficient cash to fund operations into the second quarter of 2010.

Conference call scheduled

The Company has scheduled a conference call to which participants may listen via live webcast, accessible through the Agennix Web site at www.agennix.com or via telephone. A replay will be available on the Web site following the live event. The call, which will be conducted in English, will be held on November 23rd at 15:00 CET/9:00 AM ET. The dial-in numbers for the call are as follows:

Participants in Europe:    0049 69 667775756
                           0044 20 3003 2666
Participants in the U.S.:  1-646-843-4608

Please dial in 10 minutes before the beginning of the call.

About Agennix

Agennix AG is a publicly traded biopharmaceutical company focused on developing novel anti-cancer therapies. The Company was formed by the combination of GPC Biotech AG and Agennix Incorporated. The Company's most advanced program is talactoferrin, an oral targeted therapy that is in Phase 3 clinical trials in non-small cell lung cancer. Other clinical development programs include RGB-286638, a multi-targeted kinase inhibitor in Phase 1 testing; the oral platinum-based compound satraplatin; and a topical gel form of talactoferrin for wound healing. Agennix is a transatlantic company with sites in Munich, Germany; Princeton, New Jersey and Houston, Texas. For additional information, please visit the Agennix Web site at www.agennix.com.

This press release contains forward-looking statements, which express the current beliefs and expectations of the management of Agennix AG, including statements about the Company's future cash position. Such statements are based on current expectations and are subject to risks and uncertainties, many of which are beyond our control, that could cause future results, performance or achievements to differ significantly from the results, performance or achievements expressed or implied by such forward-looking statements. Actual results could differ materially depending on a number of factors, and we caution investors not to place undue reliance on the forward-looking statements contained in this press release. Forward-looking statements speak only as of the date on which they are made and Agennix undertakes no obligation to update these forward-looking statements, even if new information becomes available in the future.

- Financials follow -

For the full interim management report and interim condensed consolidated financial statements and accompanying notes for the third quarter and first nine months of 2009, please visit the Investor Relations section of the Agennix website at http://www.agennix.com/index.php?option=com_content&view=article&id=14&Itemid=33&lang=en.

GPC Biotech AG (predecessor to Agennix AG)
Interim consolidated statement of operations



                        Three months ended          Nine months  ended
                           September 30,               September 30,
                        2009          2008          2009          2008
                    (unaudited)   (unaudited)   (unaudited)   (unaudited)
                      EUR 000       EUR 000       EUR 000       EUR 000

Revenue                      171         9,336           274        12,341


Research and
 development
 expenses                 (1,332)       (3,128)       (3,862)      (13,410)
Administrative
 expenses                 (1,623)       (2,913)       (7,983)      (10,301)
Amortization of
 intangible assets           (41)          (50)         (129)         (164)
Impairment of
 intangible assets             -             -          (407)       (2,306)
Other income               1,007           610         2,348         1,845
Other expenses              (739)         (702)       (1,853)       (1,482)
Finance income               437           407         1,189         1,486
Finance costs                (21)          (35)         (185)         (251)
                    ------------  ------------  ------------  ------------

Net (loss) income
 before tax               (2,141)        3,525       (10,608)      (12,242)
Income taxes                   -             -             -             -
                    ------------  ------------  ------------  ------------
Net (loss) income
 for the period           (2,141)        3,525       (10,608)      (12,242)
                    ============  ============  ============  ============


Basic and diluted
 (loss) income per
 share                (EUR  0.06)    EUR  0.10    (EUR  0.29)   (EUR  0.33)
Average number of
 shares used in
 computing basic
 and diluted (loss)
 income per share     36,836,853    36,836,853    36,836,853    36,836,853


See accompanying notes to unaudited interim condensed consolidated
financial statements




GPC Biotech AG (predecessor to Agennix AG)
Interim consolidated statements of financial position
as of September 30, 2009

                                                September 30,  December 31,
                                                   2009           2008
                                                (unaudited)
                                                  EUR 000        EUR 000
Assets
Non-current assets
Note receivable                                       13,479             -
Conversion component of note receivable                1,594             -
Property and equipment                                   322           524
Intangible assets                                      3,060         3,584
Other financial assets                                   429           146
                                                ------------  ------------
Total non-current assets                              18,884         4,254

Current assets
Trade receivables                                        222             6
Prepayments                                              388           432
Other current assets                                   1,407         2,209
Available-for-sale investments                            38           136
Cash and cash equivalents                              2,708        31,686
                                                ------------  ------------
Total current assets                                   4,763        34,469

Total Assets                                          23,647        38,723
                                                ============  ============

Equity and Liabilities
Equity attributable to the equity holders
Issued capital                                        36,837        36,837
Share premium                                        366,464       369,654
Other reserves                                        (3,782)       (3,918)
Retained loss                                       (389,557)     (378,949)
                                                ------------  ------------
Total equity                                           9,962        23,624

Non-current liabilities
Convertible bonds                                        206         1,705
Deferred revenue, net of current portion               7,380         7,380
                                                ------------  ------------
Total non-current liabilities                          7,586         9,085

Current liabilities
Trade payables                                           240         1,221
Accruals and other current liabilities                 2,799         4,750
Short term loan payable                                3,017             -
Deferred revenue, current portion                         43            43
                                                ------------  ------------
Total current liabilities                              6,099         6,014
                                                ------------  ------------
Total liabilities                                     13,685        15,099
Total equity and liabilities                          23,647        38,723
                                                ============  ============

See accompanying notes to unaudited interim condensed consolidated
financial statements




GPC Biotech AG
Selected Financial Data
From Interim Consolidated Cash Flow Statement



                                                 Nine months ended June 30
                                                   2009           2008
                                                (unaudited)    (unaudited)
                                                  EUR 000        EUR 000

                                                ------------  ------------
Net cash used in operating activities                (15,468)      (24,804)
                                                ------------  ------------

Net cash (used in) provided by investing
 activities                                          (14,946)       15,013
                                                ------------  ------------

                                                ------------  ------------
Net cash provided by (used in) financing
 activities                                            1,288        (1,455)
                                                ------------  ------------

Effect of exchange rate changes on cash and
 cash equivalents                                        148          (254)
Changes in restricted cash                                 -           (32)
                                                ------------  ------------

Net decrease in cash and cash equivalents            (28,978)      (11,532)
Cash and cash equivalents at beginning of
 period                                               31,686        49,681
                                                ------------  ------------
Cash and cash equivalents at end of period             2,708        38,149
                                                ============  ============

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