Company Announces Corporate Initiatives to Focus On and Grow the Angioedema Franchise and LFRP

BURLINGTON, Mass.--(BUSINESS WIRE)--February 22, 2012--Dyax Corp. (NASDAQ: DYAX) today announced financial results for the fourth quarter and year ended December 31, 2011. Dyax will host a webcast and conference call at 5:00 p.m. (ET) today to review financial results and updates regarding its two key value drivers - the angioedema franchise and the Licensing and Funded Research Program (LFRP).

“Building on our positive momentum from 2011, Dyax is committed to expanding our reach beyond hereditary angioedema (HAE) into the broader treatment of all forms of bradykinin-mediated angioedema,” stated Gustav Christensen, President and Chief Executive Officer of Dyax. “This represents a major unmet medical need for tens of thousands of patients worldwide and we are developing a suite of products focused on these patients, including a new laboratory test and a next-generation therapeutic product. Furthermore, the LFRP continues to be a strategically important asset for Dyax and holds significant value through its broad pipeline of clinical candidates addressing large therapeutic markets.”

Total revenues for the fourth quarter ended December 31, 2011 were $8.5 million, as compared to $9.3 million for the comparable quarter in 2010. Revenues for the year ended December 31, 2011 were $48.7 million, as compared to $51.4 million for the 2010 year.

Included in the 2011 revenues were $22.9 million of KALBITOR net sales, as compared to $8.8 million for 2010. The 2011 revenues also included $10.5 million associated with the expansion of our collaboration with Sigma-Tau. The agreement with Sigma-Tau was amended twice in 2011, including in the fourth quarter when rights to commercialize KALBITOR in several Asian territories reverted back to Dyax. This resulted in a $3.0 million reduction of revenue in the fourth quarter of 2011, which had previously been recognized in the second quarter of 2011.

The 2010 revenues included $13.8 million of development and license fee revenue associated with Dyax’s agreement with Cubist Pharmaceuticals, and $11.3 million of revenue from the sale of rights to royalties and other payments related to the commercialization of Xyntha^® by our licensee Pfizer, Inc.

Quarterly and annual revenues are expected to continue to fluctuate due to the timing and amount of future milestone payments, the clinical activities of collaborators and licensees, and the timing and completion of contractual commitments.

Cost of product sales for KALBITOR for the fourth quarter of 2011 were $442,000, as compared to $258,000 for the comparable quarter in 2010. For the year ended December 31, 2011, cost of product sales were $1.2 million as compared to $505,000 for the comparable period in 2010. Costs associated with manufacturing KALBITOR drug substance, which were incurred prior to KALBITOR's approval in the United States, were expensed as research and development costs and accordingly, are not included in the cost of product sales during the 2011 and 2010 periods reported.

Research and development expenses for the fourth quarter of 2011 were $8.4 million, as compared to $7.8 million for the comparable quarter in 2010. For the year ended December 31, 2011, research and development expenses increased to $34.7 million, as compared to $31.5 million for the comparable period in 2010. The 2011 research and development expenses primarily relate to key Dyax research and development initiatives, which include the following:

Selling, general and administrative expenses for the fourth quarter of 2011 increased to $10.6 million, as compared to $9.0 million for the comparable quarter in 2010. For the year ended December 31, 2011, selling, general and administrative costs increased to $37.7 million, as compared to $33.6 million for the comparable period in 2010. The higher selling, general and administrative costs in 2011 were primarily due to expanded infrastructure to support KALBITOR commercial efforts.

For the quarter ended December 31, 2011, Dyax reported a net loss of $13.5 million or $0.14 per share, as compared to a net loss of $8.9 million or $0.09 per share for the comparable quarter in 2010. For the year ended December 31, 2011, the net loss was $34.6 million or $0.35 per share, as compared to $24.5 million or $0.26 per share for the comparable period in 2010.

As of December 31, 2011, Dyax had cash, cash equivalents, and investments totaling $57.5 million, exclusive of restricted cash.

Dyax also announced that it has implemented a strategic alignment of its resources to focus on and grow the angioedema franchise and LFRP. This investment includes the expansion of the KALBITOR franchise, as well as other high value opportunities in the bradykinin-mediated angioedema space. These opportunities include:

In aligning its corporate initiatives around the angioedema franchise and LFRP, Dyax plans to out-license early stage preclinical programs that do not fall within either of these areas. In addition, Dyax is redirecting resources supporting these non-core areas and has implemented a workforce reduction of 27 employees.

This guidance excludes potential revenue and cash flow from new licenses or collaborations and ex-U.S. KALBITOR sales.

Webcast and Conference Call
Date:				Wednesday, February 22, 2012
Time:				5:00 p.m. ET
Telephone Access:				Domestic callers, dial 877-674-2415; reference the Dyax conference call
				International callers, dial 708-290-1364
				No passcode required.
Online Access:				Go to the Investor Relations section of the Dyax website (www.dyax.com) and follow instructions for accessing the live webcast. Participants may register in advance.

A replay of the conference call will be available through March 22, 2012 and may be accessed by dialing 855-859-2056. International callers should dial 404-537-3406. The replay passcode for all callers is 48011519. The webcast will be archived on the Dyax website for an indefinite period of time.

KALBITOR is a plasma kallikrein inhibitor indicated for the treatment of acute attacks of hereditary angioedema (HAE) in patients 16 years of age and older. KALBITOR, which was discovered and developed by Dyax, is the first subcutaneous treatment available in the U.S. for treating acute HAE attacks.

Anaphylaxis has been reported after administration of KALBITOR. Because of the risk of anaphylaxis, KALBITOR should only be administered by a healthcare professional with appropriate medical support to manage anaphylaxis and hereditary angioedema. Healthcare professionals should be aware of the similarity of symptoms between hypersensitivity reactions and hereditary angioedema and patients should be monitored closely. KALBITOR should not be administered to patients with known clinical hypersensitivity to KALBITOR.

For more information about KALBITOR, including full prescribing information, visit www.KALBITOR.com.

Hereditary angioedema (HAE) is a rare acute inflammatory condition characterized by episodes of severe, often painful swelling affecting the extremities, gastrointestinal tract, genitalia, and larynx. HAE is caused by low or dysfunctional levels of C1 esterase inhibitor (C1-INH), a naturally occurring molecule that inhibits plasma kallikrein, a key mediator of inflammation, and other serine proteases in the blood. HAE is estimated to affect 1 in 10,000 to 1 in 50,000 individuals. Learn more at www.HAEHope.com.

Dyax is a fully integrated biopharmaceutical company focused on the development and commercialization of novel biotherapeutics for unmet medical needs. Dyax’s lead product, ecallantide, has been approved under the brand name KALBITOR^® in the United States for the treatment of acute attacks of hereditary angioedema (HAE) in patients 16 years of age and older.

Dyax is commercializing KALBITOR in the United States independently, and establishing strategic collaborations to develop and commercialize ecallantide for the treatment of HAE in key regions worldwide. Currently, Dyax has agreements for regions including Europe, Japan, Russia, the Middle East, Israel, North Africa, Australia, New Zealand, Latin America (excluding Mexico) and the Caribbean. Dyax is also exploring other potential indications for ecallantide, either alone or through collaborations, including ACE inhibitor-induced angioedema.

Ecallantide and other compounds in Dyax’s pipeline were identified using its patented phage display technology, which rapidly selects compounds that bind with high affinity and specificity to therapeutic targets. Dyax leverages this technology broadly through the Licensing and Funded Research Program (LFRP), which has approximately 70 revenue generating licenses and collaborations for therapeutic discovery, as well as for affinity separations, diagnostic imaging, and research reagents. The success of the Company’s LFRP portfolio is illustrated by the program’s advanced licensee pipeline that includes 18 candidates in clinical development. Of those candidates, four are in Phase 3 clinical trials, four are in Phase 2 and ten are in Phase 1.

Dyax is headquartered in Burlington, Massachusetts. For online information about Dyax Corp., please visit www.dyax.com.

This press release contains forward-looking statements, including statements regarding the prospects for the LFRP portfolio, increases in the KALBITOR patient base and treatment rates, revenues for 2012, and cash flow break-even in 2013. Statements that are not historical facts are based on Dyax’s current expectations, beliefs, assumptions, estimates, forecasts and projections about the industry and markets in which Dyax and its licensees compete. The statements contained in this release are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed in such forward-looking statements because of uncertainties involved in any future projections, as well as uncertainties associated with various activities and aspects of Dyax’s business, including risks and uncertainties associated with the following: competition from now and existing treatments for HAE; uncertainty whether KALBITOR will gain broad market acceptance; uncertainties regarding treatment rates for patients on KALBITOR; Dyax’s dependence on the expertise, effort, priorities and contractual obligations of third parties in the manufacture of KALBITOR worldwide and in the marketing, sales and distribution of KALBITOR outside of the United States; Dyax’s dependence on licensees and collaborators for development, clinical trials, manufacturing, sales and distribution of products; the uncertainty of negotiations with potential partners and collaborators; uncertainty as to whether one or more of Dyax’s licensees’ new product candidates will be commercialized and generate royalties; changing requirements and costs associated with Dyax's planned research and development activities; the uncertainty of patent and intellectual property protection; Dyax’s dependence on key management and key suppliers; the impact of future alliances or transactions involving Dyax or others; and other risk factors described or referred to Item 1A, “Risk Factors” in Dyax’s most recent Annual Report on Form 10-K and other periodic reports filed with the Securities and Exchange Commission. Dyax cautions investors not to place undue reliance on the forward-looking statements contained in this release. These statements speak only as of the date of this release, and Dyax undertakes no obligations to update or revise these statements, except as may be required by law.

DYAX CORP.
SELECTED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

		Three Months Ended December 31,						Twelve Months Ended December 31,
		2011			2010			2011			2010
		(In thousands, except share and per share data)
Revenues:
	Product sales, net	$	6,996		$	3,039		$	22,884		$	8,835
	Development and license fee revenues	$	1,520		$	6,219		$	25,853		$	42,564
Total revenues, net		$	8,516		$	9,258		$	48,737		$	51,399

Costs and expenses:
	Cost of product sales		442			258			1,223			505
	Research and development expenses		8,438			7,779			34,676			31,522
	Selling, general and administrative expenses		10,620			8,964			37,740			33,583

Total costs and expenses			19,500			17,001			73,639			65,610

Loss from operations			(10,984	)		(7,743	)		(24,902	)		(14,211	)

Other income (expense):
	Interest and other income		28			1,508			554			1,645
	Interest and other expense		(2,579	)		(2,707	)		(10,251	)		(11,937	)
	Total other expense		(2,551	)		(1,199	)		(9,697	)		(10,292	)

Net loss		$	(13,535	)	$	(8,942	)	$	(34,599	)	$	(24,503	)

Basic and diluted net loss per share		$	(0.14	)	$	(0.09	)	$	(0.35	)	$	(0.26	)

Shares used in computing basic and diluted net loss per share			98,764,384			98,507,264			98,731,289			93,267,850



SELECTED CONSOLIDATED CONDENSED BALANCE SHEET INFORMATION
(Unaudited)

		December 31, 2011			December 31, 2010
		(In thousands)
	Assets

	Cash, cash equivalents and short-term investments	$	57,504		$	77,384
	Accounts receivable, net		6,092			5,315
	Inventory		7,022			1,696
	Other current assets		4,968			3,248
	Restricted cash		1,266			922

	Total current assets		76,852			88,565

	Fixed assets and other non-current assets		5,423			2,600
	Restricted cash		1,100			1,266

	Total assets	$	83,375		$	92,431

	Liabilities and Stockholders' Equity (Deficit)

	Accounts payable and other current liabilities	$	17,128		$	11,958
	Deferred revenue		15,902			21,336
	Note payable and other long-term debt		75,372			56,474
	Other long-term liabilities		2,372			30

	Total liabilities		110,774			89,798

	Common stock and additional paid-in capital		449,515			444,911
	Accumulated deficit and other comprehensive income		(476,914	)		(442,278	)

	Total stockholders' equity (deficit)		(27,399	)		2,633

	Total liabilities and stockholders' equity (deficit)	$	83,375		$	92,431

CONTACT:
Dyax Corp.
George Migausky, 617-250-5733
Executive Vice President and Chief Financial Officer
gmigausky@dyax.com