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Research Triangle Park, North
Carolina
November 7, 2001
- Revenues increase 77%
Company initiates project to map the human metabolome
- Company exceeds first call
quarterly consensus earnings per share estimate by one cent
Paradigm Genetics,
Inc. (Nasdaq: PDGM) today reported financial results for the
third quarter ended September 30, 2001. The Company also
announced it has begun mapping the Human Metabolome, a reference
library of stable metabolites identified in human cells,
tissues, fluids and
organs, for use in drug discovery and development processes. The
company expects to have the preliminary version of the map
completed in 12 to 18 months.
For the three months ended September 30, 2001 total revenues
increased 77% to $6.3 million, compared to $3.5 million for the
same period in 2000. For the nine months ended September 30,
2001 total revenues increased 205% to $17.8 million compared to
$5.8 million for the same period in 2000. The increase in
revenue was due to higher throughput from Paradigm's
GeneFunction Factory(TM) relating to the company's commercial
partnerships with Bayer AG and Monsanto Company.
Total operating expenses for the three months ended September
30, 2001 increased 31% to $10.2 million compared to $7.8 million
for the same period in 2000. Total operating expenses for the
nine months ended September 30, 2001 increased 51% to $30.3
million compared to $20.0 million for the same period in 2000.
The increase in operating expenses resulted from the variable
costs associated with higher throughput in the GeneFunction
Factory(TM), the company's expansion of its metabolomic platform
into human health and nutrition, and investments in
informatics-based technologies.
The company reported a third quarter 2001 net loss attributable
to common stockholders of $4.1 million, or $0.15 per common
share. This included non- cash compensation charges of $0.2
million. This was $0.01 per common share better than the
consensus earnings estimate reported by First Call. This
compares to a net loss attributable to common stockholders of
$4.0 million, or $0.16 per common share for the same period in
2000. For the nine months ended September 30, 2001, the company
reported a net loss attributable to common stockholders of $12.4
million, or $0.47 per common share. This included non- cash
compensation charges of $0.8 million. This compares to a net
loss attributable to common stockholders of $25.5 million, or
$1.60 per common share for the same period in 2000.
"We believe that our metabolomics strategy complements genomics
and proteomics approaches to significantly improve and
accelerate the drug discovery and development process, increase
the metabolic engineering capabilities for the ag-sector, and
add value to the nutraceutical industry," said John A. Ryals,
Ph.D., CEO and President. "We have proven that our platform
works in plants and fungi, and during the past year, we've been
adapting it to human cell lines. Our goal is to grow the human
health unit and simultaneously build a reference library of
stable metabolites, which comprise the human metabolome."
On October 22, 2001, the company closed the sale of
approximately 5.1 million shares of common stock resulting in
gross and net proceeds to the company of approximately $28
million, and approximately $26 million respectively. Immediately
following this transaction the company had approximately $52
million in cash, cash equivalents and investments, compared to
approximately $45 million at December 31, 2000.
"The successful sale of common stock to an excellent group of
investors is a further endorsement of our business model. As
well as providing working capital, this additional cash will
allow us to continue developing our internal discovery and
development programs including the launch of our metabolomics
platform into the healthcare and nutrition markets," said Ian
Howes, Chief Financial Officer.
Highlights
- Paradigm exceeded the fifth
consecutive milestone in its commercial partnership with
Monsanto, resulting in an accelerated milestone payment. Also,
Monsanto canceled its option to terminate the agreement
without cause.
- Paradigm discovered and
validated the 250th herbicide target within its partnership
with Bayer AG, and has delivered those in the form of assay
packages. Patent applications on these genes are filed as
these potential herbicide targets are discovered. Paradigm
couples target identification with its detailed understanding
of mode of action to prioritize targets for herbicide
discovery.
- Paradigm completed the
development of a comprehensive DNA array for Magnaporthe
grisea, a devastating fungal pathogen of rice. This array will
allow Paradigm to do the most complete analysis to date of
global gene expression in a filamentous fungus (mold). This
data supports Paradigm's efforts to discover novel targets,
characterize new fungicidal chemistries and develop novel
anti-fungal compounds. In addition, Paradigm's know-how can be
used to develop arrays for researchers.
- Paradigm published details of
the first discovery of the synteny (genetic similarity)
between two filamentous fungi - Magnaporthe grisae, a tropical
rice pathogen, and Neurospora crassa, the classic bread mold.
These results allow Paradigm to speed the identification of
novel pathways and discovery anti-fungal targets for its
product development prospects.
- Paradigm processed more than
one million Arabidopsis thaliana plants through its
GeneFunction Factory(TM), a number that is unprecedented in
plant genomics history. This achievement places Paradigm at
the forefront of gene function research and with that data
Paradigm is able to analyze genes from a very broad collection
of plants, microorganisms
and animals.
Located in Research Triangle
Park, NC, Paradigm Genetics is industrializing the process of
gene function discovery for four major sectors of the global
economy: human health, nutrition, crop production, and
industrial products. The company has designed the GeneFunction
Factory(TM) - an integrated, rapid, industrial-scale laboratory
through which it discovers gene function. Paradigm and its
strategic partners intend to develop novel products using
information developed with the GeneFunction Factory(TM).
Paradigm's GeneFunction Factory(TM) is based on a
state-of-the-art phenomics platform integrated with metabolic
profiling and gene expression profiling technologies. The
backbone of the GeneFunction Factory(TM) is the company's
proprietary FunctionFinder(TM) bioinformatics system, used to
collect, store, analyze, and retrieve information. For more
information, visit
www.paradigmgenetics.com.
Company news release
N3935
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