SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K
REPORT OF FOREIGN ISSUER
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
Date of Report: August 18, 1999
BIORA AB
SE-205 12 Malmo, Sweden
Telephone: (011) 46-40-32-13-33
Indicate by a check mark whether the registrant files or will
file annual reports under cover of Form 20-F or Form 40-F.
|X| Form 20-F |_| Form 40-F
Indicate by check mark whether the registrant by furnishing the
information contained in this Form is also thereby furnishing the
information to the Commission pursuant to Rule 12g3-2(b) under the
Securities Exchange Act of 1934.
|_| Yes |X| No
If "Yes" is marked, indicate below the file number assigned to
the registrant in connection with Rule 12g3-2(b):
Not applicable.
This Form 6-K consists of Biora's half year report, which was
issued on August 18, 1999.
HALF YEAR REPORT
JANUARY 1 - JUNE 30, 1999
BIORA AB (PUBL)
AUGUST 18, 1998
Incl. non-
recurring
revenue
The first six months 1999 1998 1998
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NET SALES, SEK MILLIONS 37.5 22.9 -
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OPERATING LOSS, SEK MILLIONS - 45.4 - 58.2 - 18.81)
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NET LOSS, SEK MILLIONS - 42.2 - 51.8 - 12.41)
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1) FIRST QUARTER OF 1998 INCLUDES NONRECURRING REVENUE FROM
SEIKAGAKU CORP., BIORA'S JAPANESE PARTNER.
O SALES DURING THE SECOND QUARTER OF 1999 INCREASED By
APPROXIMATELY 80 PERCENT TO SEK 20.3 MILLION (COMPARED TO
SEK 11.2 MILLION DURING THE SAME PERIOD IN 1998). THE
INCREASE WAS MAINLY IN THE US MARKET.
O EMDOGAIN WAS APPROVED IN THE UNITED STATES FOR USE In
CONJUNCTION WITH CONVENTIONAL TREATMENT OF
PERIODONTITIS.
O A NEW SUBSIDIARY, BIORA BIOEX AB, WAS FORMED FOCUSINg ON R&D
ON PRODUCTS FOR TREATMENT OF WOUNDS AND INFECTIONS OUTSIDE
THE ORAL CAVITY.
O EXPANDED MARKETING EFFORTS IN JAPAN FROM 1,500 To
4,000 SPECIALISTS.
Biora develops, manufactures and sells products for the treatment of
periodontal disease and for use in oral surgery. Using its proprietary
technology and expertise, Biora aims to become a world leader in
biology-based products for specialized dental therapy. Biora's American
Depository Shares are listed on the Nasdaq National Market in the US and
Biora's ordinary shares are listed on the "O-list" of the Stockholm Stock
Exchange in Sweden.
PRESIDENT AND CEO INVESTOR RELATIONS U.S INVESTOR RELATIONS
TOMAS HAMMARGREN MIKAEL SJOBLOM ELISABETH LAVERS
+46 40 32 13 36 +46 40 32 13 65 +1 203 977 7797
EMDOGAIN APPROVED IN THE US FOR USE IN CONJUNCTION WITH CONVENTIONAL
TREATMENT OF PERIODONTITIS.
The United States Food and Drug Administration (FDA) has approved Emdogain
for use as an adjunct to a minimally invasive surgical technique. This
indicates that Emdogain can be utilized in conjunction with scaling and
root planing procedures for the treatment of periodontal intrabony defects
in aesthetic zones to optimize tissue height. Aesthetic zones include the
teeth and gums which appear when a person smiles. Biora estimates that the
target group in the United States for the new indication is about 60,000
dentists. Approximately 17 million scaling and root planing procedures are
performed annually in the US and Biora estimates that half of those are in
the aesthetic zone
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THE FIRST HALF OF 1999
Biora's sales during the first half of 1999 amounted to SEK 37.5 million,
as compared to SEK 22.9 million during the same period in 1998. During the
second quarter sales increased to SEK 20.3 million compared to SEK 11.2
million during the same period in 1998. The sales increase during the first
six months 1999 was mainly in the US market.
[GRAPHIC OMITTED]
SALES DURING 1998 AND 1999 PER QUARTER, SEK THOUSANDS
DEVELOPMENT OF SALES FROM BIORA BASED ON ROLLING TWELVE MONTHS, SEK THOUSANDS
[GRAPHIC OMITTED]
There are approximately 4,000 periodontists (specialists in periodontitis)
in the US market. The number of US specialists who have bought Emdogain
increased to approximately 2,000 at the end of the period and about half of
them had bought more than once.
The number of periodontists and general practitioners who purchased the
product in Germany was approximately 6,200 and almost half of those had
bought Emdogain more than once. In Sweden approximately 600 have purchased
Emdogain and of those about 420 have made more than one purchase.
In Japan Biora's products are marketed through the Japanese biotech company
Seikagaku Corporation. According to Seikagaku, sales in Japan continued to
be strong during the period and the number of customers was about 990, of
whom 400 had bought Emdogain more than once. During the third quarter of
1999 Seikagaku will broaden the target group from 1,500 to 4,000 dentists
and specialists.
THE GOAL IS TO MAKE EMDOGAIN A PREFERRED TREATMENT Emdogain has now been
approved and launched in all markets considered to be key markets. Biora's
long-term goal is for Emdogain to be included in the preferred treatment of
periodontitis.
PREFGEL (TM)
Biora's new product, PrefGel, is used to clean root surfaces in connection
with treatment of periodontitis. During 1998, PrefGel was approved for sale
in Europe and the United States, and in January 1999 the US patent was
issued. Application for registration was submitted in Japan during the
first quarter of 1999. PrefGel is primarily intended for use in treatments
involving Biora's main product Emdogain, but can also be used in other
treatments. Because of its neutral pH, PrefGel will not damage the
root surface or surrounding soft tissues.
INTENSIFIED FOCUS ON RESEARCH AND DEVELOPMENT To strengthen Biora's
position, research and development projects are in process to broaden the
number of products and applications. Development work is conducted on two
fronts: documenting new indications for Emdogain, primarily in clinical
studies within the dental field, and developing new products based on
biological principles.
Important areas for new indications are non-surgical treatment of
periodontitis, recession type defects, evulsed teeth, impacted wisdom teeth
and endodontics. To further simplify the use of Emdogain, Biora is
developing a pre-mixed, user friendly product. Documentation for licensing
the product in Europe and the US is expected to be submitted during the
third quarter of 1999.
NEW KNOWLEDGE ABOUT EMDOGAIN AND ITS MECHANISM OF ACTION During the
reporting period Biora presented new knowledge about the mechanism by which
the company's principal product, Emdogain, assists in the generation of new
tissue supporting the tooth, in connection with periodontal surgery. Cell
culture studies conducted by Biora, indicate that the growth of cells from
the gingival margin (epithelial cells) is inhibited while PDL-cells from
the area between the root and the jawbone are favored by growing in the
presence of Emdogain, which is important for successful surgical treatment
of periodontal defects.
STUDIES SHOW THAT EMDOGAIN CAN HAVE AN INFLUENCE ON WOUND HEALING --
NEW SUBSIDIARY ESTABLISHED.
Biora has shown in cell culture studies that Emdogain-covered surfaces
inhibit the growth of certain bacteria, especially some of the pathogens
behind caries (e.g. Streptococcus mutans) or periodontal disease (e.g.
Actinobacillus actinomycetemcomitans). Another bacteria which is believed
to be inhibited is Staphylococcus aureus, which is common in e.g. "hospital
disease".
This implies that wound healing is improved by Emdogain without the need
for local or general antibiotics. This type of modulating effect on
bacteria in combination with the positive influence on growth factors may
open the possibility to use Emdogain for the treatment of wounds and
infections in and outside the oral cavity.
To emphasize Biora's focus on the diseases in the oral cavity but at the
same time develop the potential for other indications a new subsidiary,
Biora BioEx AB, has been founded.
During the first six months of 1999 Biora BioEx has submitted documentation
for three new patents. The company will continue Biora's research in areas
that can generate products for indications outside the oral cavity.
THE YEAR 2000-PROBLEM
The computer systems at the head office in Malmo have been reviewed and
certified by Biora's computer supplier. Year 2000 reviews of Biora's
production equipment, and the computer systems of Biora's subsidiaries and
principal suppliers have also been done. Biora does not expect that the
year 2000 issue will have a material effect on either sales or supplies of
raw material.
NET SALES
The Group's net sales during the period increased to SEK 37.5 million
(1998: SEK 22.9 million).
PROFIT/LOSS
Gross profit amounted to SEK 28.9 million (1998: SEK 18.0 million).
The improvement can be explained by the increase in sales.
The operating loss amounted to SEK 45.4 million (1998: loss SEK 18.8
million). Operating profit during the same period last year includes
nonrecurring revenue from Biora's Japanese partner in an amount of SEK 39.4
million. (Operating loss for the first half of 1998 excluding the
nonrecurring revenue was SEK 58.2 million). Net financial items were SEK
3.2 million (1998: SEK 6.4 million). The decrease is explained by decreased
interest bearing assets and lower market interest rates.
Net loss after tax during the period amounted to SEK 42.2 million (1998:
loss SEK 12.4 million), corresponding to a loss per share of SEK 1.99
(1998: loss SEK 0.59) based on the average number of shares outstanding.
(Net loss after tax during first half of 1998 excluding nonrecurring
revenue was SEK 51.8 million).
INVESTMENTS
Capital expenditures during the period totaled SEK 2.1 million (1998: SEK
3.9 million).
FINANCIAL POSITION
Net change in cash and cash equivalents during the period was negative, in
an amount of SEK 41.5 million (1998 neg. SEK 52.4 million). At the end of
the report period (figures for December 31, 1998, for comparison, are given
below in parentheses) the Group's liquid funds amounted to SEK 145.5
million (SEK 187 million), the equity/assets ratio was 85.3 % (86.6 %) and
the Group equity amounted to SEK 172.8 million (SEK 214.0 million).
EMPLOYEES
As of June 30, 1999, Biora had 89 employees, which is an increase of four
people since year-end 1998.
PARENT COMPANY
Net sales for the period amounted to SEK 26.5 million (1998: SEK 16.7
million) and its loss after financial items and tax was SEK 37.4 million
(1998: profit of SEK 9.1 million). The six month result for 1998 includes
the nonrecurring revenue of SEK 39.4 million received from the Japanese
distributor. (Loss after financial items excluding nonrecurring revenue was
SEK 30.3 million).
Investments in fixed assets and patents were SEK 1.0 million (1998: SEK 2.3
million). Net change in cash and cash equivalents during the period was
negative, in an amount of SEK 45.3 million (1998: neg. SEK 50.7 million).
At the end of the reporting period (figures for December 31, 1998 are given
below in parentheses) the parent company's liquid assets amounted to SEK
136.2 million, (SEK 181.5 million), equity/assets ratio was 90.2 % (91.4 %)
and share holders equity to SEK 187.4 million (SEK 223.2 million)
COMING FINANCIAL INFORMATION
Biora will publish financial information for 1999 on the following dates:
Interim report for the third quarter November 3 (NEW DATE!)
Year end report February 2000
Annual report April 2000
Malmo, August 18, 1999
TOMAS HAMMARGREN, PRESIDENT AND CEO
BIORA DEVELOPS, MANUFACTURES AND SELLS PRODUCTS FOR THE TREATMENT OF
PERIODONTAL DISEASE AND FOR USE IN ORAL SURGERY. USING ITS PROPRIETARY
TECHNOLOGY AND EXPERTISE, BIORA AIMS TO BECOME A WORLD LEADER IN
BIOLOGY-BASED PRODUCTS FOR SPECIALIZED DENTAL THERAPY. BIORA'S AMERICAN
DEPOSITORY SHARES ARE LISTED ON THE NASDAQ NATIONAL MARKET IN THE US AND
BIORA'S ORDINARY SHARES ARE LISTED ON THE "O-LIST" OF THE STOCKHOLM STOCK
EXCHANGE IN SWEDEN.
THIS REPORT MAY CONTAIN CERTAIN FORWARD-LOOKING STATEMENTS THAT RELATE TO
THE FUTURE EVENTS OR FUTURE BUSINESS AND FINANCIAL PERFORMANCE. SUCH
STATEMENTS CAN ONLY BE PREDICTIONS AND THE ACTUAL EVENTS OR RESULTS MAY
DIFFER FROM THOSE DISCUSSED. THE COMPANY CAUTIONS THAT THESE STATEMENTS ARE
SUBJECT TO IMPORTANT FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER
MATERIALLY FROM THOSE EXPRESSED OR IMPLIED IN SUCH FORWARD LOOKING
STATEMENTS AND ARE MORE FULLY DISCUSSED IN PERIODIC REPORTS FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION.
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENTS OF
OPERATIONS
1999 1999 1998 1999 1998 1998
(Swedish GAAP, unaudited) Jan-Jun APR-JUN Apr-Jun JAN-JUN Jan-Jun Jan-Dec
(TUSD)1) (TSEK) (TSEK) (TSEK) (TSEK) (TSEK)
<S> <C> <C> <C> <C> <C> <C>
Net sales 4 542 20 258 11 195 37 492 22 929 50 119
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Costs of goods sold 2) -1 040 -4 511 -3 038 -8 585 -4 923 -10 864
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GROSS PROFIT 3 502 15 747 8 157 28 907 18 006 39 255
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Selling expenses -5 361 -23 543 -21 138 -44 253 -42 562 -89 622
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Administrative expenses -1 052 -4 544 -5 541 -8 682 -12 358 -22 133
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Research and development -2 456 -9 998 -9 012 -20 278 -20 733 -39 980
costs 2)
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Other operating income and -136 -335 760 -1 125 38 843 40 952
expenses 3)
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LOSS FROM OPERATIONS -5 503 -22 673 -26 774 -45 431 -18 804 -71 528
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Financial net 392 1 298 2 696 3 233 6 389 11 572
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LOSS AFTER FINANCIAL ITEMS -5 112 -21 375 -24 078 -42 198 -12 415 -59 956
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Income tax -4 - -632 -32 2 -42
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Minority interest - - 81 - - -
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LOSS FOR THE PERIOD -5 116 -21 375 -24 629 -42 230 -12 413 -59 998
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</TABLE>
<TABLE>
<CAPTION>
CONSOLIDATED BALANCE
SHEETS
Jun 30, JUN 30, Jun 30, Dec 31,
(Swedish GAAP, unaudited) 1999 1999 1998 1998
(TUSD)1) (TSEK) (TSEK) (TSEK)
<S> <C> <C> <C> <C>
Intangible long term assets 2 652 21 892 26 890 25 337
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Tangible long term assets 1 386 11 439 12 741 12 269
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Financial long term assets 306 2 528 2 553 2 571
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TOTAL LONG TERM ASSETS 4 344 35 859 42 184 40 177
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Inventories 494 4 079 2 941 4 174
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Current receivables 2 062 17 025 16 032 15 787
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Bank deposits 12 114 100 000 203 850 148 050
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Cash and bank 5 512 45 499 30 038 38 998
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TOTAL CURRENT ASSETS 20 182 166 603 252 861 207 009
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TOTAL ASSETS 24 526 202 462 295 045 247 186
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Shareholders' equity 20 930 172 774 265 212 213 970
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Provisions 54 442 230 397
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Long term liabilities 4) 19 155 170 155
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Current liabilities 4) 3 524 29 091 29 433 32 664
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TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES 24 526 202 462 295 045 247 186
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1) Average exchange rate Jan-Jun , 1999, USD 1 = SEK 8,255
2) 2.5% royalty to Astra on sales of Emdogain has been reclassified from
research and development costs to costs of goods sold. The comparative
figures have been adjusted accordingly.
3) In the first quarter 1998 a nonrecurring revenue from Seikagaku
Corporation of 39,4 MSEK is included in other operating income and
royalty expense to Astra of 1,0 MSEK on this revenue is included in
other operating expenses.
4) Biora did not have any interest bearing liabilities either on June 30,
1999, June 30, 1998, or December 31, 1998.
</TABLE>
<TABLE>
<CAPTION>
STATEMENTS OF CASH FLOWS
CONSOLIDATED (TSEK) 1999 1998 1999 1998 1998
(Swedish GAAP, unaudited) APR-JUN Apr-Jun JAN-JUN Jan-Jun Jan-Dec
<S> <C> <C> <C> <C> <C>
Loss for the period -21 375 -24 629 -42 230 -12 413 -59 998
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Depreciation and amortization 1 401 1 279 2 687 2 403 5 156
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Change in capitalized research and 1 776 731 3 552 1 462 2 924
development costs
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Prepaid nonrecurring revenue - - - -39 375 -39 375
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Other adjustments to reconcile net 39 561 77 27 241
loss to net cash
flows from operating activites
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Change in assets and liabilities 2 330 -5 050 -3 305 -649 -2 821
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NET CASH USED IN OPERATING ACTIVITIES -15 829 -27 108 -39 219 -48 545 -93 873
- ------------------------------------------------------------------------------------------
Capital expenditures (tangible assets -946 -1 772 -2 079 -3 917 -5 842
and patents)
- ------------------------------------------------------------------------------------------
Other investing activities - - 31 - -
- ------------------------------------------------------------------------------------------
NET CASH USED IN INVESTING ACTIVITIES -946 -1 772 -2 048 -3 917 -5 842
- ------------------------------------------------------------------------------------------
NET CASH USED IN / FROM FINANCING - -35 - 56 111
ACTIVITIES
- ------------------------------------------------------------------------------------------
Effect of exchange rate changes on -44 32 -282 -16 342
cash and cash
equivalents
- ------------------------------------------------------------------------------------------
NET CHANGE IN CASH AND CASH -16 819 -28 883 -41 549 -52 422 -99 262
EQUIVALENTS
- ------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
KEY RATIOS
1999 1998 1997 1996 1995
(Swedish GAAP, unaudited) JAN - JUN 1) 2)
<S> <C> <C> <C> <C> <C>
Net sales (TSEK) 37 492 50 119 16 499 4 561 936
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R & D costs (TSEK) 3) 20 278 39 980 21 207 10 884 9 347
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Return on capital employed, % 4) -43,6 -40,0 -53,2 -266,2 -46,1
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Return on equity,% 5) -43,7 -40,0 -58,1 neg -128,8
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Equity / assets ratio, % 6) 85,3 86,6 81,9 -34,2 28,8
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Net debt / equity ratio, % 7) -84,2 -87,4 -103,0 -84,3 163,3
- ------------------------------------------------------------------------------------------
Total equity (TSEK) 172 774 213 970 277 935 -18 437 7 986
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Average number of shares 21 204 21 204 20 571 14 207 10 819
outstanding, (000s) 8)
- ------------------------------------------------------------------------------------------
Equity per share, SEK 8) 8,15 10,09 13,51 -1,30 0,74
- ------------------------------------------------------------------------------------------
Loss per share, SEK 8) -3,98 -2,83 -3,66 -2,61 -1,01
- ------------------------------------------------------------------------------------------
1) Return on capital employed, return on equity and loss per share have
been calculated by multiplying the six month operating loss and net loss
respectively by 2 to obtain comparability to the other presented twelve
months key ratios.
2) Return on capital employed and return on equity have been adjusted for
the effect of the nonrecurring revenue from Seikagaku.
3) R&D-costs are shown gross, including capitalized costs. During 1999, as
well as during 1998, no costs have been capitalized under the caption
Capitalized R&D costs, so the net and gross costs were equal, 20,278.
(2.5% royalty to Astra on sales of Emdogain has been reclassified to
costs of goods sold.)
4) Operating loss plus financial income divided by average total assets
(total assets less non-interest-bearing operating liabilities including
deferred taxes).
5) Net loss divided by average equity.
6) Shareholders' equity divided by total assets.
7) Interest-bearing liabilities less cash and bank deposits divided by
shareholders' equity.
8) The number of ordinary shares outstanding used in determination of loss
and equity per ordinary share is calculated on a proforma basis by
giving effect to a 25:1 share split and the 3:1 bonus issue completed by
the Company during 1996. The dilution effects of outstanding convertible
loans and options have not been considered when calculating equity and
loss per share for the years 1995-1999 as this would reduce the loss per
share.
</TABLE>
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
BIORA AB
Dated:August 18, 1999 By: /s/ Anders Agering
-------------------------------
Anders Agering
Chief Financial Officer
