SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
The Liposome Company, Inc.
(Exact name of registrant as specified in its charter)
Delaware 0-14887 22-2370691
(State or other jurisdiction
of incorporation) (Commission file (IRS employer identification
number) number)
One Research Way
Princeton Forrestal Center
Princeton, New Jersey 08540-6619
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (609)452-7060
Former name or former address, if changed since last report: None
Exhibit Index is on Page 3
Item 5. Other Events.
On October 28, 1997, The Liposome Company, Inc. (the
"Company") issued a press release regarding its results of
operations for the fiscal quarter ended September 28, 1997. A
copy of the press release is filed as an exhibit to this report.
Item 7. Exhibits.
Exhibit No. Description
20 Copy of the Company's press release of October 28,
1997 regarding its results of operations for the fiscal
quarter ended September 28, 1997
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused behalf this registration
statement to be signed on its by the undersigned, thereunto duly
authorized.
Date: October 29, 1997
THE LIPOSOME COMPANY, INC.
By:/s/CHARLES A. BAKER
Name: Charles A. Baker
Title: Chairman and Chief
Executive Officer
EXHIBIT INDEX
Exhibit No. Description Sequentially
Numbered Page
20 Copy of the Company's 4
press release dated
October 28, 1997
FOR IMMEDIATE RELEASE
Contact:
The Liposome Company,
Inc.
Brooks Boveroux, Vice
President
(609) 452-7060
Noonan Russo
Communications
(212) 696-4455
Ernie Knewitz (media)
ext. 204
Barbara Lindheim
(investor) ext. 237
THE LIPOSOME COMPANY REPORTS
THIRD QUARTER OPERATING RESULTS
Princeton N.J. -- October 28, 1997 -- The Liposome Company,
Inc. (Nasdaq: LIPO) today reported financial results for the
third quarter ended September 28, 1997. Total revenues for
the quarter were $16,050,000 compared to $14,910,000 for the
third quarter of 1996. Year to date revenues for the nine
month period were $48,558,000 compared to $41,721,000 for the
first nine months of 1996.
At September 28, 1997, the Company had $50,105,000 in cash
and marketable securities.
"The Liposome Company has continued to make progress in
developing its oncology franchise," said Charles A. Baker,
Chairman and Chief Executive Officer. "Worldwide unit
shipments of ABELCET increased by a strong 28 percent over
the comparable prior year quarter. These results were
achieved despite the presence of significant amounts of free
product available from a competitor in the United States
market and the loss of two wholesalers through consolidation
thus potentially reducing the amount of ABELCET in the
distribution pipeline. U.S. revenues, however, were
significantly impacted by the Company's implementation of an
aggressive program in response to a competitor's pricing
reduction earlier in the year. Despite the competition, we
remain the leader in this important market, and we intend to
retain that position."
Mr. Baker continued, "During the quarter the Company had
several other accomplishments. ABELCET was launched in
Canada, where it is the only approved lipid-based
amphotericin B formulation. Furthermore, we are very
encouraged by the new relationship
with Wyeth-Ayerst in France and Italy to market ABELCET. We will
have a far greater presence in those markets through Wyeth-Ayerst
than we could have developed over the short term on our own.
Launches in both countries are expected during the fourth
quarter.
"On other fronts, patient accrual in the two U.S. Phase III
clinical studies of TLC D-99 is continuing on track. The
transition of the management of these studies from Pfizer to The
Liposome Company is proceeding smoothly. Financially, our total
expenses have been held to small increases, and the Company's
balance sheet is solid. Receivables are modest, inventory levels
are declining, and we have both a good cash position and minimal
debt."
Total expenses in the third quarter were $22,253,000 compared to
$20,262,000 in the comparable prior year quarter. Cost of sales
increased to $7,091,000, or 54 percent of product sales,
primarily due to the expensing of certain manufacturing costs as
part of the Company's previously announced program to reduce
inventories to more optimal levels. Gross margins are expected
to improve in the fourth quarter.
Research and development expenses of $6,627,000 declined from the
comparable 1996 quarter spending of $8,955,000. The decline was
primarily attributable to the absence of pre-production costs at
the Company's Indianapolis manufacturing facility that were
incurred during the 1996 quarter. Selling and administrative
expenses of $8,366,000 were $1,461,000 above the comparable 1996
quarter as a result of remaining expenses related to litigation
that has now been settled, and greater selling expenses,
particularly for the increased size of the U.S. sales force.
Net loss for the quarter was $6,203,000, or $.17 per share,
compared to a loss of $5,354,000, or $.16 per share, in the
comparable 1996 quarter. The year to date net loss applicable to
common stock was $19,222,000, or $.52 per share, including
$3,900,000 of charges related to a corporate restructuring and
other one-time items incurred during the second quarter. The net
loss for the 1996 nine month period was $15,808,000, or $.49 per
share.
Inventories of $13,732,000 have declined substantially from the
second quarter level. The Company had planned increases in
inventories during the first half of 1997 as part of the
transition of its commercial manufacturing from Princeton to
Indianapolis. In addition, the Company experienced high
production yields at both facilities. The Indianapolis facility
has received FDA approval and all manufacturing has been
transferred to Indianapolis. Further inventory reductions are
expected to be achieved by year end.
The Liposome Company is a broad-based biopharmaceutical company
developing and marketing products based on its knowledge of lipid
technology. ABELCET (Amphotericin B Lipid Complex Injection) is
marketed in the U.S. and other countries for the treatment of
severe systemic fungal infections. TLC D-99 and other products
are being developed to treat various cancers. Research is being
conducted on new cancer therapies and biologically active lipids
that may have therapeutic applications.
Except for historical information, this press
release contains forward-looking statements
that involve risks and uncertainties,
including but not limited to statements
regarding the ability of ABELCETr to retain
its leading position in the U.S. market, the
timing of launches of ABELCETr in France and
Italy, the expected improvement in product
gross margins, and the further reduction of
inventories. While these statements reflect
the Company's best current judgment, they are
subject to risks and uncertainties that could
cause actual results to vary, including the
risk factors identified in the Registration
Statement on Form S-3 dated September 30,
1997 and from time to time in the Company's
other SEC filings.
This release is also available at http://www.lipo.com
THE LIPOSOME COMPANY, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands Except Per Share Figures)
(Unaudited)
Three Months Ended Nine Months Ended
9/28/97 9/29/96 9/28/97 9/29/96
Product sales $ 13,115 $ 13,799 $ 42,740 $ 36,369
Research and
development revenues 531 610 2,331 2,502
Interest, investment
and other income 2,404 501 3,487 2,850
Total revenues 16,050 14,910 48,558 41,721
Cost of goods sold 7,091 4,347 15,621 11,611
Research and
development expense 6,627 8,955 21,470 24,190
Selling, general and
administrative expense 8,366 6,905 30,141 20,318
Interest expense 169 55 548 175
Total expenses 22,253 20,262 67,780 56,294
Net loss (6,203) (5,352) (19,222) (14,573)
Preferred Stock
dividends -- 2 -- 1,235
Net loss applicable
to Common Stock $ (6,203) $ (5,354) $(19,222) $(15,808)
Net loss per share
applicable to
Common Stock $ (0.17) $ (0.16) $ (0.52) $ (0. 49)
Weighted average
number of common
shares outstanding 37,455 33,671 36,850 32,452
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands)
(Unaudited)
September 28, 1997 December 29, 1996
Cash and short-term investments $ 35,175 $ 30,110
Accounts receivable 5,255 7,884
Inventories 13,732 9,904
Other current assets 796 882
Long-term investments 3,000 10,140
Property, plant and equipment, net 26,153 28,292
Restricted cash 11,930 6,930
Other assets, net 371 413
Total assets $ 96,412 $ 94,555
Current liabilities $ 10,581 $ 12,139
Other liabilities 5,694 7,555
Stockholders' equity 80,137 74,861
Total liabilities and
stockholders' equity $96,412 $ 94,555
