-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KT9z+v2hmJZpsTYq6kTfADa5j7LjMYtmba96TAuFMMipHuYauPWflXFgUvRE7j+J q7MWsvXncPgBhyJcE59bbQ== 0001193125-04-070186.txt : 20040427 0001193125-04-070186.hdr.sgml : 20040427 20040427063821 ACCESSION NUMBER: 0001193125-04-070186 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040427 ITEM INFORMATION: ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20040427 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MAXYGEN INC CENTRAL INDEX KEY: 0001068796 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMMERCIAL PHYSICAL & BIOLOGICAL RESEARCH [8731] IRS NUMBER: 770449487 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-28401 FILM NUMBER: 04755551 BUSINESS ADDRESS: STREET 1: 515 GALVESTON DRIVE CITY: REDWOOD CITY STATE: CA ZIP: 94063 BUSINESS PHONE: 6502985300 MAIL ADDRESS: STREET 1: 515 GALVESTON DRIVE CITY: REDWOOD CITY STATE: CA ZIP: 94063 8-K 1 d8k.htm FORM 8-K Form 8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 


 

FORM 8-K

 


 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

 

Date of Report: April 27, 2004

 

Date of earliest event reported: April 27, 2004

 


 

Maxygen, Inc.

(Exact name of registrant as specified in its charter)

 


 

Delaware

(State of Incorporation)

 

000-28401   77-0449487
(Commission File No.)   (I.R.S. Employer Identification No.)

 

515 GALVESTON DRIVE

REDWOOD CITY, CA 94063

(Address of principal executive offices, including zip code)

 

(650) 298-5300

(Registrant’s telephone number, including area code)

 



Item 7. Financial Statements and Exhibits.

 

(c) Exhibits

 

99.1   Press Release dated April 27, 2004 by Maxygen, Inc.

 

Item 12. Results of Operations and Financial Condition

 

On April 27, 2004, Maxygen announced its financial results for the three months ended March 31, 2004 and certain other information. The press release, which has been attached as Exhibit 99.1, discloses certain financial measures, such as (i) non-GAAP loss applicable to common stockholders (loss applicable to common stockholders calculated according to GAAP adjusted to exclude stock compensation expense, amortization of intangible assets and subsidiary preferred stock accretion) and (ii) cash utilization (non-GAAP loss applicable to common stockholders, excluding depreciation but adjusted to include capital expenditures), each of which may be considered a non-GAAP financial measure. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. As used herein, “GAAP” refers to accounting principles generally accepted in the United States.

 

To supplement Maxygen’s consolidated financial statements presented in accordance with GAAP, Maxygen uses non-GAAP financial measures of cash utilization and non-GAAP loss applicable to common stockholders, which are adjusted from results based on GAAP. These non-GAAP financial measures are provided to enhance the user’s overall understanding of Maxygen’s current financial performance and Maxygen’s prospects for the future. Maxygen has historically reported certain non-GAAP financial measures to investors and believes the inclusion of non-GAAP financial measures provides consistency in its financial reporting. These measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results. The non-GAAP financial measures included in the attached press release have been reconciled to the nearest GAAP measure.

 

The attached press release also contains forward-looking statements relating to Maxygen’s performance during 2004. A more thorough discussion of certain factors that may affect Maxygen’s operating results is included under the captions “Risk Factors That May Affect Results of Operations and Financial Condition” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Maxygen’s Annual Report on Form 10-K for the fiscal year ended December 31, 2003, and Maxygen’s Quarterly Reports on Form 10-Q. Additional information will be included under that caption in Maxygen’s Annual Report on Form 10-Q for the three months ended March 31, 2004, which will be filed with the SEC by May 10, 2004.

 

The information in this report shall not be treated as “filed” for purposes of the Securities Exchange Act of 1934, as amended.


SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

    MAXYGEN, INC.

Date: April 27, 2004

 

By:

 

/s/ Michael Rabson


       

Michael Rabson

       

Senior Vice President

EX-99.1 2 dex991.htm PRESS RELEASE Press Release

Exhibit 99.1

 

[Letterhead of Maxygen, Inc.]

 

MAXYGEN REPORTS FIRST QUARTER 2004 FINANCIAL RESULTS

AND PROGRESS OF PRODUCT PIPELINE

 

Optimized interferon alpha product candidates delivered to Roche —

 

Redwood City, Calif., April 27, 2004 – Maxygen, Inc. (Nasdaq: MAXY) today reported financial results for the first quarter ended March 31, 2004 and provided an update on the progress of its product pipeline.

 

Financial results

 

For the first quarter of 2004, Maxygen reported a non-GAAP loss applicable to common stockholders of $9.7 million, or $0.28 per share(1), compared to a non-GAAP loss applicable to common stockholders of $2.9 million, or $0.09 per share(1), in the comparable period in 2003. In both cases, these results are exclusive of stock compensation expense, amortization of intangible assets and subsidiary preferred stock accretion. Including such charges, Maxygen reported a loss applicable to common stockholders on a GAAP basis of $10.1 million, or $0.29 per share, for the first quarter of 2004 compared to a loss applicable to common stockholders of $4.3 million, or $0.12 per share, in the first quarter of 2003.

 

Revenue in the first quarter of 2004 was $7.6 million compared to $13.1 million for the same period in 2003. The decrease in revenue is primarily attributable to two one-time non-recurring payments in the first quarter of 2003: a $2 million product development milestone from Pioneer Hi-Bred to Verdia, Inc., a wholly-owned subsidiary of Maxygen; and a $2.5 million payment from Hercules to Codexis, Inc., a majority-owned subsidiary of Maxygen in connection with the termination of the collaboration agreement between Codexis and Hercules. Expenses relating to research and development increased slightly in the first quarter of 2004 to $14.1 million from $14.0 million in the same period in 2003.

 

At March 31, 2004, cash, cash equivalents and marketable securities totaled $191.4 million. This includes $17.4 million held by Maxygen’s subsidiaries Verdia and Codexis.

 

**************

 

Progress of product pipeline

 

“We continue to make strong progress on advancing our product pipeline,” said Russell Howard, Ph.D., Chief Executive Officer of Maxygen. “Specifically, in this quarter we delivered to Roche several promising optimized interferon alpha product candidates for the treatment of hepatitis C virus infection. Our proprietary product candidates, including our next-generation G-CSF and our next-generation interferon beta, also continue to advance internally. Robust preclinical data for these product candidates suggests that Maxygen’s optimized versions may have superior clinical properties relative to currently marketed products. Both of these product candidates are currently moving forward into manufacturing and toward clinical trials. We intend to accomplish this while keeping within our cash utilization target for our core human therapeutics business of less than $35 million in 2004.” (2)

 

Lead interferon alpha product candidates delivered to Roche

 

Maxygen has recently delivered to Roche several optimized lead interferon alpha product candidates selected by Roche for the treatment of hepatitis C virus infection. These product candidates were engineered by Maxygen to have increased antiviral activity and enhanced immunotherapeutic properties compared to currently marketed interferon alpha products, while maintaining the convenience of once-weekly dosing. Roche is now responsible for advancing these product candidates into development.

 

Hepatitis C virus (HCV) is a contagious viral infection that can lead to serious, sometimes fatal, liver disease and causes an estimated 8,000 to 10,000 deaths annually in the United States. The current worldwide market for interferon alpha for hepatitis C (including ribavirin) is approximately $1.6 billion.


Next-generation G-CSF product candidate announced

 

Maxygen also announced that it has developed an optimized version of G-CSF for the treatment of neutropenia. Preclinical results from several animal models suggest that Maxygen’s next-generation G-CSF product candidate may reduce the duration of post-chemotherapy induced neutropenia compared to existing products, while maintaining the convenience of once-weekly dosing.

 

G-CSF (granulocyte-colony stimulating factor), with worldwide sales of over $2 billion, is one of the most commercially successful biotechnology franchises. Despite the commercial success of existing G-CSF products, significant opportunity exists for superior treatments.

 

Neutropenia, a common side effect from chemotherapeutic treatments of many forms of cancer, is a severe decrease in neutrophil cell counts in the blood. Neutropenic patients are susceptible to bacterial infection, which can be life threatening and can potentially lead to a change in chemotherapy regimen that may negatively impact the effectiveness of cancer therapy.

 

Next-generation interferon beta product candidate continues to move forward

 

Maxygen is continuing to advance its next-generation interferon beta for the treatment of multiple sclerosis. Currently, this product candidate is moving forward into manufacturing and toward clinical trials. Maxygen’s next-generation interferon beta is designed to have a less-frequent dosing regimen and increased efficacy through improved pharmacokinetics.

 

Maxygen reported that in mini-pig and non-human primates, Maxygen’s next-generation interferon beta exhibited a significantly longer half-life and improved pharmacodynamic response when compared to currently marketed interferon beta products. Based on existing data illustrating a positive relationship between increased half-life and increased efficacy in interferon alpha products, Maxygen believes that the prolonged half-life and improved pharmacodynamics of its product candidate may lead to increased efficacy in treating MS in humans.

 

Multiple sclerosis (MS) is a chronic autoimmune disease of the central nervous system. There is currently no cure for MS, but drugs can help slow the course of the disease in some patients. An estimated 400,000 Americans have MS. The current worldwide market value of interferon beta for the treatment of MS is approximately $2.4 billion.

 

Optimized interferon gamma advancing in development

 

Maxygen’s fourth core product candidate is an optimized interferon gamma for the treatment of idiopathic pulmonary fibrosis (IPF) and other diseases that is licensed to InterMune, Inc. Based upon preclinical studies in nonhuman primates, Maxygen believes that its next-generation interferon gamma may have superior pharmacokinetic properties to InterMune’s currently marketed, first-generation interferon gamma product. InterMune is now planning on advancing this long-acting version of interferon gamma toward human clinical trials.

 

Idiopathic pulmonary fibrosis is an inflammatory disease that results in severe scarring or “fibrosis” of the lung. The average survival rate of a patient with IPF is four to six years after diagnosis. The estimated value of the U.S. market for IPF is approximately $2.5 billion.

 

About Maxygen

 

Maxygen, Inc., headquartered in Redwood City, California, is focused on creating novel products using its integrated proprietary technologies for human therapeutics and industrial applications. Maxygen’s technologies bring together advances in molecular biology and protein modification to create novel biotechnology products. Maxygen has strategic collaborations with leading companies including Roche, Aventis, and InterMune.


Forward-Looking Statements

 

This news release contains forward-looking statements about our research and business prospects, including those relating to: our ability to develop and/or commercialize any of our potential products; the attributes of any product that we develop; our projected 2004 cash utilization; our future development plans and the development plans of our collaborators; and our ability to maintain existing collaborations. Such statements involve risks and uncertainties that may cause results to differ materially from those set forth in these statements. Among other things these risks and uncertainties include, but are not limited to: changing research and business priorities of Maxygen and/or its collaborators; the inherent uncertainties of biological research; our ability to develop human therapeutic drugs in an increasingly competitive biotechnology industry and the uncertain timing of such development; competitors producing superior products; and our future ability to enter into and/or maintain research and commercialization collaborations. These and other risk factors are more fully discussed in our Form 10-K for the year ended December 31, 2003, including under the caption “Risk Factors,” and in our other periodic SEC reports, all of which are available from Maxygen at www.maxygen.com. Maxygen disclaims any obligation to update or revise any forward-looking statement contained in this release as a result of new information or future events or developments. Maxygen and the Maxygen logo are trademarks of Maxygen, Inc.

 

Contact:

Alison Trollope

Investor & Public Relations

Maxygen, Inc.

p. 650-298-5853

f. 650-298-5877


Selected Consolidated Financial Information

Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)

 

    

Three Months Ended

March 31,


 
     2004

    2003

 
     (unaudited)  

Revenues:

                

Collaborative research and development revenue

   $ 7,026     $ 12,312  

Grant revenue

     599       832  
    


 


       7,625       13,144  

Expenses:

                

Research and development

     14,062       14,035  

General and administrative

     3,151       3,054  

Stock compensation expense

     151       731  

Amortization of intangible assets

     —         286  
    


 


Total operating expenses

     17,364       18,106  
    


 


Loss from operations

     (9,739 )     (4,962 )

Interest income and other (expense), net

     592       1,525  

Equity in net loss of joint venture and minority interests

     (701 )     (500 )
    


 


Net loss

   $ (9,848 )   $ (3,937 )
    


 


Net loss

   $ (9,848 )   $ (3,937 )

Subsidiary preferred stock accretion

     (250 )     (319 )
    


 


Loss applicable to common stockholders

   $ (10,098 )   $ (4,256 )
    


 


Basic and diluted loss applicable per common share

   $ (0.29 )   $ (0.12 )

Shares used in computing basic and diluted loss applicable per common share

     34,941       34,193  

Non-GAAP loss applicable to common stockholders excluding stock compensation expense, amortization of intangible assets and subsidiary preferred stock accretion (1)

     (9,697 )     (2,920 )

Non-GAAP basic and diluted loss applicable per common share excluding stock compensation expense, amortization of intangible assets and subsidiary preferred stock accretion (1)

   $ (0.28 )   $ (0.09 )


Condensed Consolidated Balance Sheets

(in thousands)

 

     March 31,
2004


   December 31,
2003


     (unaudited)    (Note 1)

Cash, cash equivalents and marketable securities

   $ 191,389    $ 196,840

Other current assets

     8,566      9,787

Property and equipment, net

     11,445      12,444

Goodwill and other intangibles, net

     12,192      12,192

Other assets

     1,738      1,364
    

  

Total assets

   $ 225,330    $ 232,627
    

  

Current liabilities

   $ 13,362    $ 12,280

Non-current deferred revenue

     406      872

Long-term obligations

     891      41

Minority Interest

     21,460      21,210

Stockholders’ equity

     189,211      198,224
    

  

Total liabilities and stockholders’ equity

   $ 225,330    $ 232,627
    

  

 

Note 1: Derived from consolidated audited financial statements as of December 31, 2003.


1. MAXYGEN, INC. CONSOLIDATED

 

Reconciliation of GAAP, non-GAAP loss applicable to common stockholders, and loss applicable per common share

(in thousands, except per share amounts)

 

    

Three Months Ended

March 31,


 
     2004

    2003

 
     (unaudited)  

Loss applicable to common stockholders

   $ (10,098 )   $ (4,256 )

Stock compensation expense

     151       731  

Amortization of intangible assets

     —         286  

Subsidiary preferred stock accretion

     250       319  
    


 


Non-GAAP loss applicable to common stockholders

   $ (9,697 )   $ (2,920 )
    


 


Shares used in computing basic and diluted loss applicable per common share

     34,941       34,193  

Non-GAAP basic and diluted loss applicable per common share

   $ (0.28 )   $ (0.09 )

 

2. MAXYGEN (HUMAN THERAPEUTICS) CASH UTILIZATION RECONCILIATION

 

Projected cash utilization for our human therapeutics business is equal to Maxygen’s projected consolidated cash utilization excluding the cash utilization of our two industrial subsidiaries — Codexis, Inc. and Verdia, Inc. Projected consolidated cash utilization is equal to projected non-GAAP loss applicable to common stockholders excluding depreciation but adjusted to include capital expenditures. Projected non-GAAP loss applicable to common stockholders is equal to loss applicable to common stockholders excluding (i) stock compensation expense, (ii) amortization of intangible assets and (iii) subsidiary preferred stock accretion.

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