ANN ARBOR, Mich., Sept. 13 /PRNewswire-FirstCall/ -- Aastrom
Biosciences, Inc. (NASDAQ:ASTM) today reported financial results
for the fourth quarter and fiscal year ended June 30, 2006. The
Company also reported several clinical and operational achievements
during the quarter, including: * Completion of the accrual and
treatment phase for all 36 patients enrolled in the U.S. Phase I/II
multi-center long bone fracture clinical trial. * Receipt of a
local German human pharmaceuticals manufacturing license for the
production of the Company's TRC-based cell products for clinical
use in compliance with German law and EU clinical trial directives.
The newly licensed manufacturing facility was established as a
collaboration at the Fraunhofer Institute for Interfacial
Engineering and Biotechnology in Stuttgart, Germany, and will be
used to expand current clinical trials that use TRC-based products
for tissue regeneration. * Execution of the sale of approximately
15.9 million shares of the Company's common stock in a registered
direct placement to a select group of institutional investors at a
price of $1.60 per share for gross proceeds of approximately $25.5
million. In July 2006, the Board of Directors appointed George W.
Dunbar as President, Chief Executive Officer and Director of
Aastrom. Mr. Dunbar brings over 25 years of experience in the
healthcare field to the Company, including 15 years in the role of
Chief Executive Officer at both established and early-stage
healthcare companies in the biotech, pharmaceutical, diagnostic and
device sectors. R. Douglas Armstrong, Ph.D., who stepped down as
CEO after 15 years, will continue as Chairman of the Board for the
remainder of his term. This management team transition supports the
Company's continuing goals of establishing strategic alliances,
moving product candidates through the clinical and regulatory
process, and ultimately bringing its autologous cell products to
the marketplace. The Company is also pleased to announce that
effective September 11, 2006, Elmar R. Burchardt, M.D., Ph.D., was
appointed to the new position of Vice President Medical Affairs. As
previously announced, Dr. Burchardt is responsible for directing
all of Aastrom's clinical programs utilizing the Company's
proprietary TRC technology, including programs for long bone
fractures, critical limb ischemia, spine fusion and osteonecrosis.
He will also lead the development of new indication programs, such
as a program for cardiac tissue regeneration. "Aastrom is focused
on accelerating the development, the manufacturing and the
achievement of regulatory approval of its autologous cell products
for use in regenerative medicine using its platform technology. We
are targeting areas of high unmet medical need where tissue
regeneration may improve the quality of life for many people,"
stated Mr. Dunbar. "Our number one priority is to move our
TRC-based tissue regeneration cell products from research and
clinical programs into the marketplace for multiple indications."
Other significant highlights during fiscal year 2006 include the
following: * Clinical: - Bone Regeneration: * TRCs received an
Orphan Drug Designation from the U.S. Food and Drug Administration
(FDA) for use in the treatment of osteonecrosis of the femoral
head. * Bone regeneration results, evidenced by callus formation or
bone bridging in the first 7 patients at one clinical site were
presented at an orthopedic meeting by Matthew L. Jimenez, M.D.,
Principal Investigator of Aastrom's U.S. Phase I/II multi-center
long bone fracture clinical trial. * Positive bone regeneration
results were reported in 5 patients evaluated for jaw bone
reconstruction in a feasibility clinical trial conducted with the
Teknon Hospital Maxillofacial Clinic in Barcelona, Spain. * An EU
Phase I/II multi-center long bone fracture clinical trial is being
conducted at several centers in Barcelona, Spain, after being
approved by the Spanish Drug Agency (AEMPS). * A U.S. Phase I/II
spine fusion clinical trial is being conducted at William Beaumont
Hospital in Royal Oak, Michigan. - Vascular Regeneration: *
Diabetic patients are being enrolled into a controlled clinical
trial to treat critical limb ischemia at the Heart and Diabetes
Center North Rhine- Westphalia, located in Bad Oeynhausen, Germany.
* Operational: - A collaboration agreement was executed for the
development of products for the orthopedics market using
Orthovita's synthetic ceramic matrices and ceramic- collagen
matrices (VITOSS) and Aastrom's TRCs. * Corporate Governance: -
Four senior pharmaceutical and biotech executives were added to the
Board of Directors: * Stephen G. Sudovar, CEO of SGS Associates,
former President and CEO of EluSys Therapeutics, Inc., and former
President of Roche Laboratories, Inc. * Alan L. Rubino, President
and COO of Pharmos Corporation, and former executive at PDI, Inc.,
and Cardinal Health * Nelson M. Sims, former President and CEO of
Novavax, Inc., and former President of Eli Lilly Canada, Inc. *
Robert L. Zerbe, M.D., CEO of QUATRx Pharmaceutical, Inc., and
former executive at Eli Lilly and Company, and Pfizer (formerly
Parke-Davis) * Financial: - Received a two-year Phase II NIH grant
for $740,000 extending Aastrom's adult stem cell technology process
to other tissues - Received a two-year Phase II NIH grant for
$798,000 to support further development of Aastrom's stem cell
manufacturing systems Fiscal Year 2006 Fourth Quarter and Year
Ended June 30, 2006 Results Fiscal Year 2006 Fourth Quarter and
Year Ended June 30, 2006 Results Total revenues for the quarter
ended June 30, 2006, consisting of product sales and grant funding,
were $328,000 compared to $96,000 for the same period in fiscal
year 2005. Total revenues for the twelve months ended June 30, 2006
were $863,000 compared to $909,000 for the same period in fiscal
year 2005. We no longer market our cell manufacturing platform as a
stand-alone product; instead it is predominantly used to
manufacture our proprietary TRC-based cell products for
regenerative medicine. Therefore, until we receive product
registration from a regulatory authority, we do not anticipate
significant product sales revenue. Product sales increased slightly
for the quarter ended June 30, 2006 to $17,000 from $10,000 for the
same period in fiscal year 2005, and decreased for the twelve
months ended June 30, 2006 to $159,000 from $387,000 for the same
period in fiscal year 2005. Grant revenues increased for the
quarter and twelve months ended June 30, 2006 to $311,000 and
$704,000, respectively, from $86,000 and $522,000 for the same
periods in fiscal year 2005. Grant revenues accounted for 82% of
total revenues for the twelve months ended June 30, 2006, compared
to 57% for the same period in fiscal year 2005 and are recorded on
a cost-reimbursement basis. As we continue to pursue grant funding,
grant revenues may vary in any period based on timing of grant
awards, grant-funded activities, level of grant funding and number
of grant awards received. Total costs and expenses for the quarter
and twelve months ended June 30, 2006 increased to $5,129,000 and
$18,596,000, respectively, from $3,701,000 and $13,326,000 for the
same periods in fiscal year 2005. The cost of product sales
decreased for the quarter and twelve months ended June 30, 2006, to
$0 and $11,000, respectively, from $8,000 and $139,000 for the same
periods in fiscal year 2005. As a result of the continued expansion
of our research and development activities, including additional
staffing requirements, to support future regulatory submissions,
on-going and planned tissue regeneration clinical trials in the
U.S. and EU, and the development of facilities for product
manufacturing and distribution processes, research and development
expenses for the quarter and twelve months ended June 30, 2006
increased to $2,739,000 and $9,484,000, respectively, from
$1,948,000 and $7,206,000 for the same periods in fiscal year 2005.
Research and development expenses for the quarter and twelve months
ended June 30, 2006, also include a non-cash charge of $12,000 and
$300,000, respectively, pursuant to a new accounting standard,
which requires us to measure the fair value of all employee
share-based payments and recognize that value as an operating
expense. Selling, general and administrative expenses increased for
the quarter and twelve months ended June 30, 2006 to $2,390,000 and
$9,101,000, respectively, from $1,745,000 and $5,972,000 for the
same periods in fiscal year 2005. This increase reflects additional
staffing requirements, bonuses paid to certain employees, an
accrual for performance bonuses, an accrual under the former CEO's
revised employment agreement, and recruitment expenses relating to
Board of Director members, an EU marketing director and the search
for a new CEO. This increase also reflects additional consulting
and marketing activities and increased legal costs associated with
patent protection. In addition, selling, general and administrative
expenses for the quarter and twelve months ended June 30, 2006,
included a non-cash charge of $231,000 and $734,000, respectively,
related to employee share-based payments. Net loss for the quarter
ended June 30, 2006 was $4,296,000, or $.03 per share, compared to
a net loss of $3,360,000, or $.03 per share for the same period in
fiscal year 2005. Net loss for the twelve months ended June 30,
2006, was $16,475,000, or $.15 per share, compared to $11,811,000
or $.13 per share for the same period in fiscal year 2005. The
increase in net loss is primarily the result of increased costs and
expenses offset on a per share basis by an increase in the weighted
average number of common shares outstanding resulting from sale of
our common shares to investors in fiscal year 2005. At June 30,
2006, the Company had $43.0 million in cash, cash equivalents and
short-term investments as compared to $32.4 million at June 30,
2005. Aastrom Conference Call Information George W. Dunbar,
President and Chief Executive Officer, Gerald D. Brennan, Jr., Vice
President Administrative & Financial Operations and Chief
Financial Officer, and Elmar R. Burchardt, M.D., Ph.D., Vice
President Medical Affairs of Aastrom Biosciences, Inc., will host a
conference call to review and discuss the fourth quarter and fiscal
year 2006 financial results at 11:00 a.m. (EDT) today, September
13, 2006. Interested parties should call toll- free (877) 407-9205,
or from outside the U.S. (201) 689-8054, fifteen minutes before the
start of the call to register and identify themselves as
registrants of the 'Aastrom Conference Call'. Any registered caller
on the toll-free line may ask to be placed in the queue for the
Question & Answer session. The call will be simulcast on the
web at http://www.vcall.com/IC/CEPage.asp?ID=107349. A podcast of
the call may be downloaded from the web at the internet address
above. If you are unable to participate during the live call, the
webcast will be available for replay at
http://www.investorcalendar.com/ for 60 days. Through September 23,
2006, an audio replay of the call will be available by dialing
toll-free (877) 660-6853, or from outside the U.S. (201) 612-7415;
when prompted on the phone line, the Account # is: 286 and the
Conference ID# is: 209872. About Aastrom Biosciences, Inc. Aastrom
Biosciences, Inc. (NASDAQ:ASTM) is developing autologous cell
products for the repair or regeneration of multiple human tissues,
based on its proprietary Tissue Repair Cell (TRC) technology.
Aastrom's TRC-based products are a unique cell mixture containing
stromal, stem and progenitor cell populations, produced outside the
body from a small amount of bone marrow taken from the patient.
TRC-based products have been used in over 225 patients, and are
currently in clinical trials for bone regeneration (long bone
fractures and spine fusion) and vascular regeneration (critical
limb ischemia) applications. The Company has reported positive
interim clinical trial results for TRCs suggesting both the
clinical safety and the ability of TRCs to induce tissue
regeneration in long bone fractures and jaw bone reconstruction.
Recently, the Company's proprietary TRCs received an Orphan Drug
Designation from the U.S. Food and Drug Administration (FDA) for
use in the treatment of osteonecrosis of the femoral head. In
addition, Aastrom is developing plans for a TRC-based therapy for
cardiac regeneration. For more information, visit Aastrom's website
at http://www.aastrom.com/. CONTACTS: Kris M. Maly Cameron
Associates Investor Relations Department Kevin McGrath Aastrom
Biosciences, Inc. Phone: (212) 245-4577 Phone: (734) 930-5777
Deanne Eagle (Media) Phone: (212) 554-5463 This document contains
forward-looking statements, including without limitation,
statements concerning clinical trial plans and expectations,
intended product development and commercialization objectives, and
potential product applications, which involve certain risks and
uncertainties. The forward-looking statements are also identified
through use of the words "may," "planned," "plans," "anticipate,"
and other words of similar meaning. Actual results may differ
significantly from the expectations contained in the
forward-looking statements. Among the factors that may result in
differences are the inherent uncertainties associated with clinical
trial and product development activities, regulatory approval
requirement, competitive developments, and the availability of
resources and the allocation of resources among different potential
uses. These and other significant factors are discussed in greater
detail in Aastrom's Annual Report on Form 10-K and other filings
with the Securities and Exchange Commission. AASTROM BIOSCIENCES,
INC. CONSOLIDATED STATEMENT OF OPERATIONS DATA: Quarter ended June
30, Year ended June 30, ------------------------
-------------------------- 2005 2006 2005 2006 -----------
----------- ------------ ------------ (Unaudited) REVENUES: Product
sales and rentals $ 10,000 $ 17,000 $ 387,000 $ 159,000 Grants and
other 86,000 311,000 522,000 704,000 ----------- -----------
------------ ------------ Total revenues 96,000 328,000 909,000
863,000 COSTS AND EXPENSES: Cost of product sales and rentals 8,000
-- 139,000 11,000 Cost of product sales and rentals - provision for
excess inventories -- -- 9,000 -- Research and development
1,948,000 2,739,000 7,206,000 9,484,000 Selling, general and
administrative 1,745,000 2,390,000 5,972,000 9,101,000 -----------
----------- ------------ ------------ Total costs and expenses
3,701,000 5,129,000 13,326,000 18,596,000 OTHER INCOME 245,000
505,000 606,000 1,258,000 ----------- ----------- ------------
------------ NET LOSS $(3,360,000) $(4,296,000) $(11,811,000)
$(16,475,000) =========== =========== ============ ============ NET
LOSS PER SHARE (Basic and Diluted) $ (.03) $ (.04) $ (.13) $ (.15)
=========== =========== ============ ============ Weighted average
number of common shares outstanding 102,036,000 117,104,000
93,541,000 106,314,000 =========== =========== ============
============ CONSOLIDATED BALANCE SHEET DATA: June 30, 2006
------------- ASSETS: Cash and cash equivalents $ 9,034,000
Short-term investments 33,963,000 Receivables, net 139,000
Inventories 1,000 Other current assets 528,000 Property, net
1,216,000 ---------- Total assets $ 44,881,000 ==========
LIABILITIES AND SHAREHOLDERS' EQUITY: Current liabilities $
2,539,000 Shareholders' equity 42,342,000 ---------- Total
liabilities and shareholders' equity $ 44,881,000 ==========
http://www.newscom.com/cgi-bin/prnh/20060302/NETH028LOGO
http://photoarchive.ap.org/ DATASOURCE: Aastrom Biosciences, Inc.
CONTACT: Kris M. Maly, Investor Relations Department, Aastrom
Biosciences, Inc., +1-734-930-5777; or Kevin McGrath,
+1-212-245-4577, or Media, Deanne Eagle, +1-212-554-5463, both of
Cameron Associates, for Aastrom Biosciences, Inc. Web site:
http://www.aastrom.com/
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