MISSISSAUGA, ON, April 3 /PRNewswire-FirstCall/ -- Vasogen Inc.
(NASDAQ:VSGN; TSX:VAS), today reported the results of operations
for the three months ended February 29, 2008. All dollar amounts
referenced herein are in Canadian dollars unless otherwise noted.
At February 29, 2008, our cash and cash equivalents totaled $19.9
million, compared with $23.5 million at November 30, 2007. We
incurred a net loss for the three months ended February 29, 2008,
of $5.3 million, or $0.24 per common share, compared with a net
loss of $7.7 million, or $0.47 per common share for the same period
in 2007. A key driver of this decrease was a $1.6 million reduction
in expenses resulting from the repayment of the senior convertible
notes in April 2007, and lower infrastructure and other support
costs driven by lower employee numbers in 2008. For the three
months ended February 29, 2008, research and development expenses
decreased to $2.8 million from $3.0 million for the comparable
period in 2007. During the first quarter of 2008, these costs were
incurred for the initial commercialization of Celacade in Europe
and for preparations for ACCLAIM II, a study designed to evaluate
the Celacade technology for the treatment of patients with NYHA
Class II heart failure. General and administration expenses were
$2.7 million for the three months ended February 29, 2008, compared
to $3.6 million for the same period in 2007 as a result of lower
employee numbers. Highlights - In January, preclinical findings
demonstrating that VP025, the lead candidate from our VP series of
drugs, provides a significant neuroprotective effect in a model of
Parkinson's disease were published in the European Journal of
Neuroscience (Vol 27, pp.294- 300, 2008). - The results from the
phase III ACCLAIM trial of our Celacade System in patients with
chronic heart failure were published in the January 19th issue of
The Lancet (Lancet 2008; 371: 228-36), a world- leading medical
journal. As we previously reported, while the trial did not meet
its primary endpoint, a key finding from the ACCLAIM trial was a
39% reduction in the risk of death or cardiovascular
hospitalizations for a large pre-specified subgroup of patients
with NYHA Class II heart failure who received Celacade therapy,
compared to patients receiving placebo. - On March 14, 2008, we had
a teleconference with the FDA to discuss and clarify the recent
comments from the agency regarding the use of a Bayesian approach
for ACCLAIM II, a clinical trial which is being planned to support
an application for U.S. market approval of the Celacade System for
the treatment of patients with New York Heart Association ("NYHA")
Class II heart failure. The teleconference with the FDA follows our
announcement on March 3rd, stating that the FDA disagrees with the
use of a Bayesian approach for the planned ACCLAIM II study. This
is contrary to the FDA's original communication to us recommending
a Bayesian study design. We have prepared and submitted a written
response to the FDA's comments with respect to the use of a
Bayesian approach in ACCLAIM II. - Grupo Ferrer Internacional, S.A.
("Ferrer"), our European marketing partner, has the right to market
Celacade for the treatment of chronic heart failure in certain
countries of the European Union ("E.U.") and Latin America.
Celacade has already received E.U. regulatory approval as a medical
device under the CE Mark, which enables marketing of Celacade for
the treatment of chronic heart failure in the 27 member countries
of the E.U. Celacade is also the only CE Mark approved product that
specifically targets the destructive chronic inflammation
underlying the development and progression of heart failure. Under
the CE Mark in Europe, Celacade is approved for the treatment of
all NYHA Class II patients and NYHA Class III, & IV heart
failure patients who do not have a history of prior heart attack.
We currently expect that the first clinical sites in Germany will
be in a position to offer Celacade therapy to patients in April
2008. Due to the fact that we recently provided a detailed update
on corporate activities during our Annual Shareholders' Meeting on
March 25, 2008, we will not host a conference call at this time. A
replay of the Annual Shareholders' Meeting presentation is
available at http://www.vasogen.com/. About Vasogen: Vasogen is a
biotechnology company engaged in the research and commercial
development of therapies designed to target the destructive
inflammatory process associated with the development and
progression of cardiovascular and neurodegenerative disorders. The
Company's lead product, the Celacade(TM) System, is designed to
activate the immune response to apoptosis - an important
physiological process that regulates inflammation. Celacade has
received European regulatory approval under the CE Mark for chronic
heart failure and is being marketed in the EU by Grupo Ferrer
Internacional, S.A. Celacade is also in late-stage clinical
development for the treatment of chronic heart failure in the
United States. Vasogen is also developing a new class of drugs for
the treatment of certain neuro-inflammatory disorders. VP025 is the
lead candidate from this new class of drugs. Certain statements
contained in this press release, or elsewhere in our public
documents constitute "forward-looking statements" within the
meaning of the United States Private Securities Litigation Reform
Act of 1995 and/or "forward-looking information" under the
Securities Act (Ontario). These statements may include, without
limitation, plans to advance the development of the Celacade(TM)
System or VP025, plans to fund our current activities, statements
concerning our partnering activities, health regulatory
submissions, strategy, future operations, future financial
position, future revenues and projected costs. In some cases, you
can identify forward-looking statements by terminology such as
"may", "will", "should", "expects", "plans", "anticipates",
"believes", "estimated", "predicts", "potential", "continue",
"intends", "could", or the negative of such terms or other
comparable terminology. We made a number of assumptions in the
preparation of these forward-looking statements, including
assumptions about the nature, size, and accessibility of the market
for Celacade in the treatment of chronic heart failure,
particularly in Europe, the regulatory approval process leading to
commercialization and the availability of capital on acceptable
terms to pursue the development of Celacade, and the feasibility of
additional trials. You should not place undue reliance on our
forward-looking statements which are subject to a multitude of
risks and uncertainties that could cause actual results, future
circumstances or events to differ materially from those projected.
These risks include, but are not limited to, the outcome of further
ongoing analysis of the ACCLAIM trial results, the requirement or
election to conduct additional clinical trials and the size and
design of any such trials, delays or setbacks in the regulatory
approval process, difficulties in the maintenance of existing
regulatory approvals, securing and maintaining corporate alliances,
the need for additional capital and the effect of capital market
conditions and other factors on capital availability, the potential
dilutive effects of any financing, risks associated with the
outcomes of our preclinical and clinical research and development
programs, the adequacy, timing, and results of our clinical trials,
competition, market acceptance of our products, the availability of
government and insurance reimbursements for our products, the
strength of intellectual property, reliance on partners,
subcontractors, and key personnel, losses due to fluctuations in
the U.S.-Canadian exchange rate, and other risks detailed from time
to time in our public disclosure documents or other filings with
the Canadian and U.S. securities commissions or other securities
regulatory bodies. Additional risks and uncertainties relating to
our Company and our business can be found in the "Risk Factors"
section of our Annual Information Form and Form 20-F for the year
ended November 30, 2007, as well as in our later public filings.
The forward-looking statements are made as of the date hereof, and
we disclaim any intention and have no obligation or responsibility,
except as required by law, to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise. The unaudited interim consolidated financial
statements, accompanying notes to the unaudited interim
consolidated financial statements, and Management's Discussion and
Analysis for the three months ended February 29, 2008, will be
accessible on Vasogen's Website at http://www.vasogen.com/ and will
be available on SEDAR and EDGAR. Summary financial tables are
provided below. VASOGEN INC. (A DEVELOPMENT STAGE COMPANY) Interim
Consolidated Balance Sheets (In thousands of Canadian dollars)
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February 29, November 30, 2008 2007
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(Unaudited) Assets Current assets: Cash and cash equivalents $
19,930 $ 23,545 Clinical supplies 1,270 1,363 Tax credits
recoverable 738 1,565 Prepaid expenses and deposits 600 787 Change
in fair value of forward foreign exchange contracts - 376
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22,538 27,636 Property and equipment 352 414
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$ 22,890 $ 28,050
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Liabilities and Shareholders' Equity Current liabilities: Accounts
payable $ 1,190 $ 1,175 Accrued liabilities 3,429 3,519
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4,619 4,694 Shareholders' equity Share capital: Authorized:
Unlimited common shares, without par value Issued and outstanding:
22,391,386 common shares (November 30, 2007 - 22,391,386) 365,670
365,670 Warrants 16,725 16,725 Contributed surplus 22,979 22,744
Deficit (387,103) (381,783)
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18,271 23,356 Future operations Commitments and contingencies
Subsequent events
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$ 22,890 $ 28,050
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VASOGEN INC. (A DEVELOPMENT STAGE COMPANY) Interim Consolidated
Statements of Operations, Deficit and Comprehensive Income (In
thousands of Canadian dollars, except per share amounts)
(Unaudited)
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Period from December 1, Three months ended 1987 to February 29,
February 28, February 29, 2008 2007 2008
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Expenses: Research and development $ 2,778 $ 3,023 $ 241,695
General and administration 2,681 3,588 119,909 Foreign exchange
loss (gain) 203 (134) 11,173
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Loss before the undernoted (5,662) (6,477) (372,777) Interest
expense on senior convertible notes payable - (5) (1,279) Accretion
in carrying value of senior convertible notes payable - (692)
(10,294) Amortization of deferred financing costs - (145) (3,057)
Loss on extinguishment of senior convertible notes payable -
(1,284) (6,749) Investment income 342 352 13,667 Change in fair
value of embedded derivatives - 573 829
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Loss and comprehensive loss for the period (5,320) (7,678)
(379,660) Deficit, beginning of period: As originally reported
(381,783) (351,374) (1,510) Impact of change in accounting for
stock-based compensation - - (4,006) Impact of change in accounting
for financial instruments on December 1, 2006 - (1,632) (1,632)
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revised (381,783) (353,006) Charge for acceleration payments on
equity component of senior convertible notes payable - - (295)
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Deficit, end of period $ (387,103) $ (360,684) $ (387,103)
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Basic and diluted loss per common share $ (0.24) $ (0.47) $ -
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VASOGEN INC. (A DEVELOPMENT STAGE COMPANY) Interim Consolidated
Statements of Cash Flows (In thousands of Canadian dollars)
(Unaudited)
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Period from December 1, Three months ended 1987 to February 29,
February 28, February 29, 2008 2007 2008
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Cash provided by (used in): Operating activities: Loss for the
period $ (5,320) $ (7,678) $ (379,660) Items not involving cash:
Amortization 62 126 6,222 Accretion in carrying value of senior
convertible notes payable - 692 10,294 Amortization of deferred
financing costs - 145 3,057 Loss on extinguishment of senior
convertible notes payable - 1,284 6,749 Change in fair value of
embedded derivatives - (573) (829) Stock-based compensation 235 563
9,814 Common shares issued for services - - 2,485 Unrealized gain
on forward foreign exchange contract - - (376) Unrealized foreign
exchange loss (gain) 192 (100) 11,735 Other - - (35) Change in
non-cash operating working capital 1,398 (3,475) 2,349
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(3,433) (9,016) (328,195) Financing activities: Shares and warrants
issued for cash - - 326,358 Warrants exercised for cash - - 16,941
Options exercised for cash - - 7,669 Share issue costs - 3 (24,646)
Issue (repayment) of senior convertible notes payable, net - (635)
38,512 Cash released from restriction - 3,036 - Paid to related
parties - - (234)
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- 2,404 364,600 Investing activities: Purchases of property and
equipment - (30) (2,465) Purchases of acquired technology - -
(1,283) Purchases of marketable securities - - (244,846) Settlement
of forward foreign exchange contracts - 10 (4,824) Maturities of
marketable securities - - 240,677
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- (20) (12,741) Foreign exchange gain (loss) on cash held in
foreign currency (182) 280 (3,734)
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Increase (decrease) in cash and cash equivalents (3,615) (6,352)
19,930 Cash and cash equivalents, beginning of period 23,545 30,427
-
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Cash and cash equivalents, end of period $ 19,930 $ 24,075 $ 19,930
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DATASOURCE: Vasogen Inc. CONTACT: Glenn Neumann, Investor
Relations, 2505 Meadowvale Blvd, Mississauga, ON, Canada, L5N 5S2,
tel: (905) 817-2004, fax: (905) 569-9231, http://www.vasogen.com/,
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