VIMRX Reports Third Quarter Financial Results; Addition of Cell Therapy Business Signals Strong Growth Potential

Business Wire, Nov 17, 1997

WILMINGTON, Del.--(BUSINESS WIRE)--Nov. 17, 1997--VIMRX Pharmaceuticals Inc. (Nasdaq: VMRX), a development-stage company that is commercializing new biotechnologies directly and through majority owned subsidiaries, announced its results for the third quarter ended September 30, 1997.

Operating expenses for the third quarter ending September 30, 1997 were $4.9 million, as compared to $1.7 million for the same period in 1996, due principally to expenses related to the Innovir operations in New York and disbursements by VIMRX Genomics Inc. (related to the agreement with the Columbia Genome Center). The net loss for the third quarter 1997 was $3.2 million, or $0.06 per share, versus a net loss of $0.9 million, or $0.02 per share for the same period in 1996. Weighted average shares outstanding for the three months ended September 30, 1997 were 55.3 million versus 51.3 million for the comparable 1996 period.

Operating expenses for the nine months ending September 30, 1997 were $17.5 million, as compared to $7.2 million for the same nine month period ending 1996. The net loss for the nine months ending September 30, 1997 was $13.0 million, or $0.24 per share, compared to a net loss of $6.8 million, or $0.19 per share, for the same nine month period ending 1996. Weighted average shares outstanding for the nine months ending September 30, 1997 is 54.8 million versus 35.1 for the comparable 1996 period.

Cash and short term investments at September 30, 1997, were $33.6 million versus $46.9 million at December 31, 1996. VIMRX's cash position at the end of the second quarter is equal to about two years of expenses based on current projections.

"We continue to be very pleased with the business and scientific progress made in the past year to build a new company that is better positioned for long term growth and success," said Richard L. Dunning, President and Chief Executive Officer, VIMRX. "In particular, we see enormous potential in our integrated portfolio of genomics-related businesses: VIMRX Genomics with Columbia University for gene discovery, Innovir Laboratories for functional genomics, and the soon to be added cell therapy company with Baxter International for gene delivery."

VIMRX and Baxter Sign Agreement to Build New Cell Therapies Business

VIMRX and Baxter Healthcare Corporation have signed a definitive agreement to form a new cell therapy company that will develop and market innovative treatments for cancer and other life-threatening diseases. VIMRX will have majority ownership of the company, and Baxter will have minority ownership. The assets of Baxter's Immunotherapy Division, a global leader in ex vivo cellular therapies, will be transferred to the new company, including its patented cell selection, expansion and storage technologies.

The lead products included in the new company will be the Isolex(R) 300i and the Isolex(R) 300SA Cell Selection Systems, which are currently marketed in Europe. The Isolex(R) 300SA is under review in the U.S. with the Food and Drug Administration (FDA) and in Japan. The collaborators plan to advance current research and development programs through the aggressive development of cell growth, cell expansion and gene therapy applications and through industry partnerships intended to expand the current cell selection platform technology for other disease areas and potential uses.

The close of the transaction is expected by year end 1997.

VM201 Factor IXai Shows Clinical Promise for Cardiac Surgery and Stroke Prevention

Pre-clinical studies on VM201 (Factor IXai), a novel anticoagulant compound, indicate that the compound selectively prevents blood clots that can lead to stroke during cardiac surgery, while successfully reducing the potential for unwanted bleeding complications. Further, pre-clinical data, for the first time, indicated that VM201 in an animal model of stroke limited blood clotting and cerebral injury in the treatment of stroke without increasing bleeding risk. VM201 may provide a substantial benefit to the patients who are at high risk of bleeding complications during surgery and those patients intolerant to current anticoagulant therapies.

VIMRxyn Advances to Phase II in Topical Application

VIMRX has initiated a Phase II clinical trial to evaluate VIMRxyn(R) (synthetic hypericin) as a topically applied, light-activated therapy for specific skin diseases including psoriasis, cutaneous T-cell lymphoma and warts. The studies will be conducted at the University of Pennsylvania Medical Center, Philadelphia, to evaluate the efficacy and tolerability of topically applied, photo-activated hypericin in persons affected by the targeted skin diseases. Earlier results demonstrated a substantial increase in potency of VIMRxyn(R) to inhibit growth and reproduction responses of malignant T-cells growing in cell culture when hypericin is photo-activated. The data indicate that photo- activated VIMRxyn causes significant anti-growth effects on malignant lymphoid cells isolated from the blood of people living with cutaneous T-cell lymphoma.