Nanogen Reports 2001 First Quarter Results

Apr 30, 2001, 01:00 ET from Nanogen, Inc.

    SAN DIEGO, April 30 /PRNewswire/ -- Nanogen, Inc. (Nasdaq:   NGEN) today
 announced financial results for the first quarter ended March 31, 2001.
     Nanogen's total revenues for the first quarter ended March 31, 2001 were
 $2.9 million compared to $2.3 million for the same period in 2000.  The
 Company earned the revenue recognized during the quarter ended March 31, 2001
 primarily through sponsored research programs arising from the Company's
 corporate alliances and from contracts or grants with government agencies.
 The revenue recognized during the first quarter ended March 31, 2001 also
 included product revenue related to sales of the NanoChip(TM) Molecular
 Biology Workstation and NanoChip(TM) cartridges.
     Nanogen shipped four NanoChip(TM) Molecular Biology Workstations during
 the quarter ended March 31, 2001.  The four shipments included one sale
 recorded as product revenue, two non-title transfer transactions and one sale
 recorded as sponsored research revenue and funded via a corporate alliance.
 Title transferring transactions normally result in the recording of full
 instrument revenue at the time of the transaction, while non-title
 transferring transactions may spread instrument revenue associated with the
 transaction, if any, over the life of the agreement.
     The sale was to the University Pompeu Fabra, Barcelona, Spain.  The
 University Pompeu Fabra intends to use the NanoChip(TM) Molecular Biology
 Workstation to study the human Y chromosome and mitochondrial DNA single
 nucleotide polymorphism ("SNP") variations among human populations.  The
 University Pompeu Fabra also intends to develop research on the genetic
 epidemiology of various complex diseases.  One of the non-title transferring
 transactions was a shipment to the Scottish National Blood Transfusion Service
 ("SNBTS") under a Development Site Agreement.  SNBTS will use the Workstation
 to develop an assay able to detect bacterial contamination prior to delivering
 blood components.  The second non-title transferring transaction was the
 shipment of an instrument to the Copenhagen University Hospital
 (Rigshospitalet), a hospital associated with the Herlev University Hospital
 (KAS Herlev).  This shipment was made pursuant to an expansion of an existing
 Development Site Agreement.  Rigshospitalet, which conducts clinical research
 on genetic epidemiology of multifactorial diseases, will use the second
 Workstation in connection with the Copenhagen City Heart Study, a
 cardiovascular study of 10,000 individuals from the general population.  The
 additional sale recorded through funded research was to Aventis Research and
 Technologies as part of our collaboration to develop gene expression
 applications on the NanoChip(TM) system.
     The Company's cash, cash equivalents and short-term investment balance at
 March 31, 2001 was $87.3 million.  Total operating expenses for the first
 quarter of 2001 were $10.5 million, as compared to $6.5 million for the same
 period in 2000.  The increase in operating expenses for the first quarter of
 2001 as compared to the same period in 2000 is primarily due to increased
 sales and marketing expenses as the Company expanded its sales and marketing
 organization; as well as an increase in legal expenses related to enhancing
 Nanogen's intellectual property portfolio and fees related to patent
 litigation.  The Company anticipates a continuation of these expenditures at
 this level as the NanoChip(TM) system launch progresses, the patent portfolio
 continues to increase, and litigation continues.  For the quarter ended March
 31, 2001, the Company reported a net loss of $6.3 million or $0.30 per share,
 compared to a net loss of $3.7 million or $0.20 per share for the same period
 in 2000.
     "During the first quarter of 2001, Nanogen completed the hiring and
 training of its sales and support team, an important step in building an
 effective commercial organization," said Howard C. Birndorf, Chairman and
 Chief Executive Officer.  "In addition, we invested considerable efforts in
 our Development Site customers, increasing their comfort and experience with
 the NanoChip(TM) technology.  We now have sites using the system for a broad
 range of genetic-based research, including the fields of oncology, infectious
 diseases, genetic diseases and drug metabolism.  We will continue to support
 these customers as we learn more about how the NanoChip(TM) system can be
 further improved and refined to address our targeted customers and markets.
 We believe that the combination of feedback and publications from our
 Development Site customers and the integration and training of the sales and
 marketing team will begin to be reflected in our sales activity in the second
 half of 2001."
 
     Highlights for the first quarter, ended March 31, 2001 include:
 
     --  Initiation of testing for the gene expression application of the
         NanoChip(TM) Molecular Biology Workstation at three beta sites
     --  Upgrading of the NanoChip(TM) loader to use a 384 well format as well
         as a 96 well format to further lengthen walk-away capabilities
     --  Progress with Aventis in the development of an electronics-based
         protein kinase screening assay
     --  Award of patent for a novel method of detecting length polymorphisms,
         including short tandem repeats
     --  Formation of a relationship with American Medical Laboratories, Inc.
         to obtain comparison studies of the NanoChip(TM) technology against
         other companies, and to pursue the development of molecular diagnostic
         test protocols
 
     "We are pleased with the Company's progress in its research and
 development programs during the first quarter," added Mr. Birndorf.  "We have
 initiated gene expression beta trials and have made substantial progress in
 kinase screening.  We also continue to work with Hitachi to improve our
 instrumentation, and we have established an important relationship with
 American Medical Laboratories which we expect to benefit us both technically
 and commercially."
 
     Webcast of Conference Call
     Nanogen management will hold a conference call to discuss first quarter
 financial results today at 4:30 p.m. Eastern Time.  A live webcast is
 available at http://www.videonewswire.com/NANOGEN/043001/ and through a link
 that is posted on Nanogen's website at http://www.nanogen.com.  A telephone
 replay of the conference call also will be available for 48 hours at
 800-633-8284 (domestic) or 858-812-6440 (international), reservation
 #18538478.  The webcast will be available on Nanogen's website through May 7,
 2001.
 
     Nanogen markets its NanoChip(TM) Molecular Biology Workstation system to
 scientists and genomics laboratories, setting new standards for SNP scoring.
 In addition, Nanogen is developing a series of electronics-based products to
 help researchers and clinical healthcare providers accelerate their practical
 understanding and use of genomic information.  The products introduced and
 under development are intended to provide quick and accurate analysis of DNA,
 RNA and proteins, and may eventually "bridge" the gap between the research and
 clinical settings.  The Nanogen system is intended for research use only and
 not for use in diagnostic procedures.  For additional information please visit
 Nanogen's web site at www.nanogen.com.
 
     This press release contains forward-looking statements that are subject to
 risks and uncertainties that could cause actual results to differ materially
 from those set forth in the forward-looking statements, including whether the
 Company's NanoChip(TM) system can be successfully commercialized, whether the
 patented inventions can be successfully incorporated into commercial products,
 whether products under development can be successfully developed and
 commercialized, whether results reported by our customers or partners can be
 identically replicated, whether the Company's collaborations will continue to
 be funded, and other risks and uncertainties discussed under the caption
 "Factors That May Affect Results" and elsewhere in the Company's Form 10-K for
 the year ended December 31, 2000 filed with the Securities and Exchange
 Commission.  These forward-looking statements speak only as of the date
 hereof.  The Company disclaims any intent or obligation to update these
 forward-looking statements.  The Company may, at its discretion, issue
 additional announcements regarding sales or placements of its NanoChip(TM)
 Molecular Biology Workstation as it deems appropriate and as required by law.
 
 
                                   NANOGEN, INC.
                            CONSOLIDATED BALANCE SHEETS
                         (in thousands, except share data)
 
                                                     March 31,    December 31,
                                                       2001           2000
                                                    (unaudited)
                           ASSETS
     Current assets:
      Cash and cash equivalents                       $36,427        $55,330
      Short-term investments                           50,886         39,759
      Accounts receivable                               1,277          1,322
      Inventory                                         3,471          2,289
      Other current assets                              2,069          1,689
     Total current assets                              94,130        100,389
 
     Property and equipment, net                        5,368          5,373
     Acquired technology rights                         4,879          5,179
     Restricted cash                                      164            164
     Other assets                                          63             63
     Total assets                                    $104,604       $111,168
 
 
             LIABILITIES AND STOCKHOLDERS' EQUITY
 
     Current liabilities:
      Accounts payable                                   $990         $1,223
      Accrued liabilities                               3,642          4,595
      Deferred revenue                                    159            360
      Current portion of capital lease obligations      1,721          2,011
     Total current liabilities                          6,512          8,189
 
     Capital lease obligations, less current portion    1,963          1,565
 
     Stockholders' equity:
      Convertible preferred stock, $.001 par value,
       5,000,000 shares authorized; no shares issued and
       outstanding at March 31, 2001 and
       December 31, 2000                                   --             --
 
      Common stock, $.001 par value, 50,000,000 shares
       authorized; 20,999,812 and 20,913,151 shares issued
       and outstanding at March 31, 2001 and December 31,
       2000, respectively                                  21             21
      Additional paid-in capital                      193,922        193,459
      Accumulated other comprehensive income              826            270
      Deferred compensation                              (336)          (325)
      Notes receivable from officers                   (1,113)        (1,099)
      Accumulated deficit                             (97,191)       (90,912)
     Total stockholders' equity                        96,129        101,414
     Total liability and stockholders' equity        $104,604       $111,168
 
 
                                   NANOGEN, INC.
                       CONSOLIDATED STATEMENTS OF OPERATIONS
                                    (unaudited)
                       (in thousands, except per share data)
 
                                                  Three months ended March 31,
                                                        2001            2000
     Revenues:
      Sales                                              $229            $--
      Sponsored research                                2,346          1,862
      Contract and grant revenue                          364            450
     Total revenues                                     2,939          2,312
 
     Operating expenses:
      Cost of sales                                       170             --
      Research and development                          4,323          4,243
      Selling, general and administrative               6,045          2,281
     Total operating expenses                          10,538          6,524
     Loss from operations                              (7,599)        (4,212)
 
     Interest income, net                               1,326            534
     Loss on foreign currency transactions                 (6)            --
     Net loss                                         $(6,279)       $(3,678)
 
     Net loss per share -
      Basic and diluted                                $(0.30)        $(0.20)
 
     Number of shares used in computing net loss per
      share - basic and diluted                        20,655         18,818
 
                     MAKE YOUR OPINION COUNT -  Click Here
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SOURCE Nanogen, Inc.
    SAN DIEGO, April 30 /PRNewswire/ -- Nanogen, Inc. (Nasdaq:   NGEN) today
 announced financial results for the first quarter ended March 31, 2001.
     Nanogen's total revenues for the first quarter ended March 31, 2001 were
 $2.9 million compared to $2.3 million for the same period in 2000.  The
 Company earned the revenue recognized during the quarter ended March 31, 2001
 primarily through sponsored research programs arising from the Company's
 corporate alliances and from contracts or grants with government agencies.
 The revenue recognized during the first quarter ended March 31, 2001 also
 included product revenue related to sales of the NanoChip(TM) Molecular
 Biology Workstation and NanoChip(TM) cartridges.
     Nanogen shipped four NanoChip(TM) Molecular Biology Workstations during
 the quarter ended March 31, 2001.  The four shipments included one sale
 recorded as product revenue, two non-title transfer transactions and one sale
 recorded as sponsored research revenue and funded via a corporate alliance.
 Title transferring transactions normally result in the recording of full
 instrument revenue at the time of the transaction, while non-title
 transferring transactions may spread instrument revenue associated with the
 transaction, if any, over the life of the agreement.
     The sale was to the University Pompeu Fabra, Barcelona, Spain.  The
 University Pompeu Fabra intends to use the NanoChip(TM) Molecular Biology
 Workstation to study the human Y chromosome and mitochondrial DNA single
 nucleotide polymorphism ("SNP") variations among human populations.  The
 University Pompeu Fabra also intends to develop research on the genetic
 epidemiology of various complex diseases.  One of the non-title transferring
 transactions was a shipment to the Scottish National Blood Transfusion Service
 ("SNBTS") under a Development Site Agreement.  SNBTS will use the Workstation
 to develop an assay able to detect bacterial contamination prior to delivering
 blood components.  The second non-title transferring transaction was the
 shipment of an instrument to the Copenhagen University Hospital
 (Rigshospitalet), a hospital associated with the Herlev University Hospital
 (KAS Herlev).  This shipment was made pursuant to an expansion of an existing
 Development Site Agreement.  Rigshospitalet, which conducts clinical research
 on genetic epidemiology of multifactorial diseases, will use the second
 Workstation in connection with the Copenhagen City Heart Study, a
 cardiovascular study of 10,000 individuals from the general population.  The
 additional sale recorded through funded research was to Aventis Research and
 Technologies as part of our collaboration to develop gene expression
 applications on the NanoChip(TM) system.
     The Company's cash, cash equivalents and short-term investment balance at
 March 31, 2001 was $87.3 million.  Total operating expenses for the first
 quarter of 2001 were $10.5 million, as compared to $6.5 million for the same
 period in 2000.  The increase in operating expenses for the first quarter of
 2001 as compared to the same period in 2000 is primarily due to increased
 sales and marketing expenses as the Company expanded its sales and marketing
 organization; as well as an increase in legal expenses related to enhancing
 Nanogen's intellectual property portfolio and fees related to patent
 litigation.  The Company anticipates a continuation of these expenditures at
 this level as the NanoChip(TM) system launch progresses, the patent portfolio
 continues to increase, and litigation continues.  For the quarter ended March
 31, 2001, the Company reported a net loss of $6.3 million or $0.30 per share,
 compared to a net loss of $3.7 million or $0.20 per share for the same period
 in 2000.
     "During the first quarter of 2001, Nanogen completed the hiring and
 training of its sales and support team, an important step in building an
 effective commercial organization," said Howard C. Birndorf, Chairman and
 Chief Executive Officer.  "In addition, we invested considerable efforts in
 our Development Site customers, increasing their comfort and experience with
 the NanoChip(TM) technology.  We now have sites using the system for a broad
 range of genetic-based research, including the fields of oncology, infectious
 diseases, genetic diseases and drug metabolism.  We will continue to support
 these customers as we learn more about how the NanoChip(TM) system can be
 further improved and refined to address our targeted customers and markets.
 We believe that the combination of feedback and publications from our
 Development Site customers and the integration and training of the sales and
 marketing team will begin to be reflected in our sales activity in the second
 half of 2001."
 
     Highlights for the first quarter, ended March 31, 2001 include:
 
     --  Initiation of testing for the gene expression application of the
         NanoChip(TM) Molecular Biology Workstation at three beta sites
     --  Upgrading of the NanoChip(TM) loader to use a 384 well format as well
         as a 96 well format to further lengthen walk-away capabilities
     --  Progress with Aventis in the development of an electronics-based
         protein kinase screening assay
     --  Award of patent for a novel method of detecting length polymorphisms,
         including short tandem repeats
     --  Formation of a relationship with American Medical Laboratories, Inc.
         to obtain comparison studies of the NanoChip(TM) technology against
         other companies, and to pursue the development of molecular diagnostic
         test protocols
 
     "We are pleased with the Company's progress in its research and
 development programs during the first quarter," added Mr. Birndorf.  "We have
 initiated gene expression beta trials and have made substantial progress in
 kinase screening.  We also continue to work with Hitachi to improve our
 instrumentation, and we have established an important relationship with
 American Medical Laboratories which we expect to benefit us both technically
 and commercially."
 
     Webcast of Conference Call
     Nanogen management will hold a conference call to discuss first quarter
 financial results today at 4:30 p.m. Eastern Time.  A live webcast is
 available at http://www.videonewswire.com/NANOGEN/043001/ and through a link
 that is posted on Nanogen's website at http://www.nanogen.com.  A telephone
 replay of the conference call also will be available for 48 hours at
 800-633-8284 (domestic) or 858-812-6440 (international), reservation
 #18538478.  The webcast will be available on Nanogen's website through May 7,
 2001.
 
     Nanogen markets its NanoChip(TM) Molecular Biology Workstation system to
 scientists and genomics laboratories, setting new standards for SNP scoring.
 In addition, Nanogen is developing a series of electronics-based products to
 help researchers and clinical healthcare providers accelerate their practical
 understanding and use of genomic information.  The products introduced and
 under development are intended to provide quick and accurate analysis of DNA,
 RNA and proteins, and may eventually "bridge" the gap between the research and
 clinical settings.  The Nanogen system is intended for research use only and
 not for use in diagnostic procedures.  For additional information please visit
 Nanogen's web site at www.nanogen.com.
 
     This press release contains forward-looking statements that are subject to
 risks and uncertainties that could cause actual results to differ materially
 from those set forth in the forward-looking statements, including whether the
 Company's NanoChip(TM) system can be successfully commercialized, whether the
 patented inventions can be successfully incorporated into commercial products,
 whether products under development can be successfully developed and
 commercialized, whether results reported by our customers or partners can be
 identically replicated, whether the Company's collaborations will continue to
 be funded, and other risks and uncertainties discussed under the caption
 "Factors That May Affect Results" and elsewhere in the Company's Form 10-K for
 the year ended December 31, 2000 filed with the Securities and Exchange
 Commission.  These forward-looking statements speak only as of the date
 hereof.  The Company disclaims any intent or obligation to update these
 forward-looking statements.  The Company may, at its discretion, issue
 additional announcements regarding sales or placements of its NanoChip(TM)
 Molecular Biology Workstation as it deems appropriate and as required by law.
 
 
                                   NANOGEN, INC.
                            CONSOLIDATED BALANCE SHEETS
                         (in thousands, except share data)
 
                                                     March 31,    December 31,
                                                       2001           2000
                                                    (unaudited)
                           ASSETS
     Current assets:
      Cash and cash equivalents                       $36,427        $55,330
      Short-term investments                           50,886         39,759
      Accounts receivable                               1,277          1,322
      Inventory                                         3,471          2,289
      Other current assets                              2,069          1,689
     Total current assets                              94,130        100,389
 
     Property and equipment, net                        5,368          5,373
     Acquired technology rights                         4,879          5,179
     Restricted cash                                      164            164
     Other assets                                          63             63
     Total assets                                    $104,604       $111,168
 
 
             LIABILITIES AND STOCKHOLDERS' EQUITY
 
     Current liabilities:
      Accounts payable                                   $990         $1,223
      Accrued liabilities                               3,642          4,595
      Deferred revenue                                    159            360
      Current portion of capital lease obligations      1,721          2,011
     Total current liabilities                          6,512          8,189
 
     Capital lease obligations, less current portion    1,963          1,565
 
     Stockholders' equity:
      Convertible preferred stock, $.001 par value,
       5,000,000 shares authorized; no shares issued and
       outstanding at March 31, 2001 and
       December 31, 2000                                   --             --
 
      Common stock, $.001 par value, 50,000,000 shares
       authorized; 20,999,812 and 20,913,151 shares issued
       and outstanding at March 31, 2001 and December 31,
       2000, respectively                                  21             21
      Additional paid-in capital                      193,922        193,459
      Accumulated other comprehensive income              826            270
      Deferred compensation                              (336)          (325)
      Notes receivable from officers                   (1,113)        (1,099)
      Accumulated deficit                             (97,191)       (90,912)
     Total stockholders' equity                        96,129        101,414
     Total liability and stockholders' equity        $104,604       $111,168
 
 
                                   NANOGEN, INC.
                       CONSOLIDATED STATEMENTS OF OPERATIONS
                                    (unaudited)
                       (in thousands, except per share data)
 
                                                  Three months ended March 31,
                                                        2001            2000
     Revenues:
      Sales                                              $229            $--
      Sponsored research                                2,346          1,862
      Contract and grant revenue                          364            450
     Total revenues                                     2,939          2,312
 
     Operating expenses:
      Cost of sales                                       170             --
      Research and development                          4,323          4,243
      Selling, general and administrative               6,045          2,281
     Total operating expenses                          10,538          6,524
     Loss from operations                              (7,599)        (4,212)
 
     Interest income, net                               1,326            534
     Loss on foreign currency transactions                 (6)            --
     Net loss                                         $(6,279)       $(3,678)
 
     Net loss per share -
      Basic and diluted                                $(0.30)        $(0.20)
 
     Number of shares used in computing net loss per
      share - basic and diluted                        20,655         18,818
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X01386573
 
 SOURCE  Nanogen, Inc.