Array BioPharma Reports Financial Results for the Fourth Quarter and Full Year of Fiscal 2006

    BOULDER, Colo., Aug. 7 /PRNewswire-FirstCall/ -- Array BioPharma Inc.
 (Nasdaq:   ARRY) today reported financial results for the fourth quarter and
 full year of fiscal 2006.
     Array reported revenue of $10.1 million for the fourth quarter of
 fiscal 2006, compared to revenue of $12.0 million for the same period in
 fiscal 2005. Investment in research and development for proprietary drug
 discovery was $9.2 million, a $2.6 million increase over the same quarter
 last year, due to additional preclinical and clinical development. Array
 reported a net loss of $12.0 million, or ($0.31) per share, for the fourth
 quarter, compared to a net loss of $6.5 million, or ($0.17) per share, for
 the same quarter in fiscal 2005. The reported net loss for the current
 quarter includes a non-cash charge of $1.3 million, or ($0.03) per share,
 for share-based compensation expenses related to FASB Statement No. 123(R).
 Array ended the fourth quarter of fiscal 2006 with $70.1 million in cash,
 cash equivalents and marketable securities.
     "We are delighted to have initiated a Phase 2 clinical trial with
 AstraZeneca on ARRY-142886, a MEK inhibitor for cancer, in malignant
 melanoma patients," said Robert E. Conway, Chief Executive Officer, Array
 BioPharma. "Our recently announced sale-leaseback transaction will provide
 $32 million in additional funding to expand and advance our exciting
 clinical pipeline of cancer and inflammation drugs."
     Fourth Quarter and Subsequent Accomplishments:
     Advancing Proprietary Research Programs
     *  ARRY-142886 (AZD6244), a novel MEK inhibitor, entered a randomized
        Phase 2 study initiated by AstraZeneca in malignant melanoma.
        AstraZeneca expects to enroll up to 180 patients at approximately
        40 centers worldwide.  Additional Phase 2 studies, in a range of other
        tumors, are scheduled to start over the next two to three months.
 
     *  Completed enrollment of cancer patients in Array's Phase 1b clinical
        trial of ARRY-142886.  We expect to present the results of this trial
        in the Fall of 2006.
 
     *  Continued enrolling cancer patients in a Phase 1 clinical trial for
        ARRY-334543, an oral, selective, reversible, small molecule tyrosine
        kinase inhibitor of both ErbB-2 (Her-2/neu) and EGFR.  We expect to
        present the results of this trial in the Fall of 2006.
 
     *  Continued a Phase 1 clinical trial in healthy volunteers for our lead
        MEK inhibitor for inflammatory disease, ARRY-438162.  ARRY-438162 was
        shown to be a potent, selective, well-tolerated MEK inhibitor and
        demonstrated efficacy in preclinical models of rheumatoid arthritis.
        We expect to present the results of this trial in the Fall of 2006.
 
     *  Completed regulated safety testing on Array's lead orally active,
        small molecule p38 inhibitor and are preparing an IND application to
        be submitted this fall.  The candidate is well tolerated and has
        demonstrated efficacy in preclinical models of both cancer and human
        arthritis.
 
     *  Continued regulated safety assessment testing on Array's lead small
        molecule Kinesin Spindle Protein (KSP) inhibitor and anticipate an IND
        filing in 2006.  The candidate has demonstrated efficacy in preclinical
        models of human cancer.
 
     Growing Partnered Research
     *  Selected the third and final compound for the small molecule
        anti-cancer MEK program with AstraZeneca AB, triggering a $1 million
        milestone payment from AstraZeneca to Array.
 
     *  Achieved a research milestone in our collaboration with Genentech, Inc.
        The milestone resulted from the nomination of a clinical candidate and
        its advancement into regulated safety assessment testing.  Array is
        entitled to additional milestone payments and potential royalties from
        Genentech based upon continued success of the program.
 
     *  Achieved two research milestones in our collaboration with Takeda.
        The milestones resulted from advancing lead compounds into preclinical
        development.
 
     Strengthening Financial Position
     *  Completed a series of agreements with our existing landlords for our
        Boulder and Longmont, Colorado facilities and with BioMed Realty Trust,
        Inc., under which we assigned options to purchase our facilities to
        BioMed.  BioMed will purchase the Boulder and Longmont facilities and
        then lease those facilities to Array through 2016.  The Boulder
        transaction was complete in July and the Longmont transaction is
        expected to close during the third quarter of calendar 2006.  Upon
        completing both transactions, Array will receive a total of
        approximately $32 million in net additional cash from the assignment
        of options.
     Revenue for the fiscal year ended June 30, 2006, was $45.0 million,
 compared to revenue of $45.5 million for fiscal year 2005. The net loss for
 the fiscal year ended June 30, 2006, was $39.6 million, or ($1.02) per
 share, compared to a net loss $23.2 million, or ($0.68) per share, reported
 in fiscal year 2005. The reported net loss for the fiscal year ended June
 30, 2006 includes a non-cash charge of $6.2 million, or ($0.16) per share,
 for share-based compensation expenses related to FASB Statement No. 123(R).
     Array will hold a conference call on Tuesday, August 8, 2006, at 9:00
 a.m. eastern time to discuss these results. Robert E. Conway, Chief
 Executive Officer, and Michael Carruthers, Chief Financial Officer, will
 lead the call.
     Conference Call Information
     Date:       Tuesday, August 8, 2006
     Time:       9:00 a.m. eastern time
     Toll-Free:  (800) 474-8920
     Toll:       (719) 457-2727
     Pass Code:  4349418
     Web Cast:   www.arraybiopharma.com
     A replay of the call will be available as a webcast on
 www.arraybiopharma.com and by phone for one week by dialing toll-free (888)
 203-1112 or (719) 457-0820. The access code is 4349418.
     About Array BioPharma:
     Array BioPharma Inc. is a biopharmaceutical company focused on the
 discovery, development and commercialization of targeted small molecule
 drugs to treat life threatening and debilitating diseases. Our proprietary
 drug development pipeline is focused on the treatment of cancer and
 inflammatory disease and includes clinical candidates that are designed to
 regulate therapeutically important targets. In addition, leading
 pharmaceutical and biotechnology companies collaborate with Array to
 discover and develop drug candidates across a broad range of therapeutic
 areas. For more information on Array, please go to www.arraybiopharma.com.
     Forward-Looking Statement:
     This press release contains forward-looking statements within the
 meaning of the Private Securities Litigation Reform Act of 1995 that
 involve significant risks and uncertainties, including those discussed in
 our annual report filed on form 10-K for the year ended June 30, 2005, and
 in other reports filed by Array with the Securities and Exchange
 Commission. Because these statements reflect our current expectations
 concerning future events, our actual results could differ materially from
 those anticipated in these forward-looking statements as a result of many
 factors. These factors include, but are not limited to, our ability to
 achieve and maintain profitability, the extent to which the pharmaceutical
 and biotechnology industries are willing to in-license drug candidates for
 their product pipelines and to collaborate with and fund third parties for
 their drug discovery activities, our ability to out-license our proprietary
 candidates on favorable terms, our ability to continue to fund and
 successfully progress internal research efforts and to create effective,
 commercially viable drugs, risks associated with our dependence on our
 collaborators for the clinical development and commercialization of our
 out-licensed drug candidates, the ability of our collaborators and of Array
 to meet drug objectives, including clinical trials, tied to milestones and
 royalties, and our ability to attract and retain experienced scientists and
 management. We are providing this information as of August 7, 2006. We
 undertake no duty to update any forward- looking statements to reflect the
 occurrence of events or circumstances after the date of such statements or
 of anticipated or unanticipated events that alter any assumptions
 underlying such statements.
                              Array BioPharma Inc.
                       Condensed Statements of Operations
                    (in thousands, except per share amounts)
                                  (Unaudited)
 
                                 Three Months Ended       Fiscal Years Ended
                                      June 30,                 June 30,
                                  2006        2005         2006         2005
 
     Revenue:
       Collaboration revenue     $9,527      $8,531      $37,738      $34,343
       License and milestone
        revenue                     598       3,513        7,265       11,162
         Total revenue           10,125      12,044       45,003       45,505
 
     Operating expenses *
       Cost of revenue (1)        9,647      10,218       39,611       38,048
       Research and development
        for proprietary
        drug discovery (2)        9,231       6,601       33,382       22,871
       Selling, general and
        administrative
        expenses (3)              3,841       2,380       13,789        9,372
         Total operating
          expenses               22,719      19,199       86,782       70,291
 
     Loss from operations       (12,594)     (7,155)     (41,779)     (24,786)
 
     Interest expense              (209)         --         (670)          --
 
     Interest income                760         638        2,835        1,542
 
     Net loss                  $(12,043)    $(6,517)    $(39,614)    $(23,244)
 
     Basic and diluted
      net loss per share         $(0.31)     $(0.17)      $(1.02)      $(0.68)
     Number of shares used to
      compute per share data     39,073      38,390       38,759       34,043
 
     *Includes stock-based
      compensation expense
       (1) Cost of revenue         $462         $--       $2,089         $113
       (2) Research and
           development for
           proprietary
           drug discovery           321          --        1,341           --
       (3) Selling, general
           and administrative
           expenses                 517          --        2,727           38
           Total                 $1,300         $--       $6,157         $151
 
 
 
                           Summary Balance Sheet Data
                                 (in thousands)
 
                                June 30,    June 30,
                                  2006        2005
 
     Cash, cash equivalents and
      marketable securities     $70,100     $92,706
     Property, plant and
      equipment, gross           66,139      61,517
     Working capital             56,008      80,435
     Total assets               102,173     127,952
     Long-term debt              14,150      10,000
     Stockholders' equity        68,641      99,415
 
 

SOURCE Array BioPharma Inc.

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