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
Date of Report: April 14, 1997
MEDIMMUNE, INC.
(Exact name of registrant as specified in its charter)
Commission File Number: 0-19131
Delaware 52-1555759
(State of Incorporation) (I.R.S. Employer
Identification No.)
35 West Watkins Mill Road, Gaithersburg, MD 20878
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (301) 417-0770
No Exhibits are being filed with this report
CytoGam and RespiGam are registered trademarks of the Company.
MEDIMMUNE, INC.
Current Report on Form 8-K
ITEM 5. OTHER EVENTS
Following is the text from the Letter to Shareholders as contained in
MedImmune, Inc.'s 1996 Annual Report which was distributed to
shareholders on April 14, 1997.
1996 was one of the most exciting and productive years in the history
of the Company. RespiGam (Respiratory Syncytial Virus Immune Globulin
Intravenous (Human), RSV-IGIV), a breakthrough product for the
prevention of RSV disease in certain high risk infants, was
successfully launched by the Company's own sales force. CytoGam
(Cytomegalovirus Immune Globulin Intravenous (Human), CMV-IGIV) sales
growth continued to expand to a record level and this, combined with
the launch of RespiGam, clearly established the commercial base of the
Company. Critical advances were also made on the clinical development
front. MEDI-493, a possible second generation RSV product, is now in
the final stages of clinical evaluation. We also initiated clinical
testing this year of the first vaccine ever tested for prevention of
disease caused by human papillomavirus (HPV). HPV causes cervical
cancer and genital warts and our ultimate goal is to develop a
preventative vaccine. Moreover, new research initiatives have resulted
in the development of vaccine candidates for several other medically
important diseases.
The Company's financial position has never been stronger. During 1996,
MedImmune raised $125 million in capital. With our commercial base
established and one of the strongest pipelines in the biotechnology
industry, we believe we now have the infrastructure and capital to
develop these opportunities.
The remainder of this letter is devoted to discussing in more detail
some of the specific accomplishments in 1996. We believe they provide
a firm foundation for continued growth. The Company is now poised to
meet the challenges of the future as it moves toward attaining
profitability and creating value for shareholders.
1.Successfully launched RespiGam for prevention of respiratory
syncytial virus (RSV) disease
On January 18, 1996, the U.S. Food and Drug Administration (FDA)
approved RespiGam for the prevention of serious respiratory syncytial
virus (RSV) disease in certain high risk infants. The product was
launched by MedImmune and our U.S. partner, American Home Products, in
September 1996. The launch has been a success reflecting a critical
medical need met by RespiGam and the skill of the MedImmune sales and
marketing organization. Sales in 1996 totaled $17.3 million.
RSV is the leading cause of pneumonia and bronchiolitis in infants and
small children. It occurs most frequently in the late fall, winter and
early spring. Although the virus affects all children, it is an
especially serious risk for the smallest and most medically fragile
infants such as those with prematurity or a chronic lung disease known
as bronchopulmonary dysplasia (BPD). As a result, approximately 90,000
children are hospitalized and 4,500 die from RSV infections annually.
The use of RespiGam was targeted to these high risk children and it is
the only product shown to be effective in reducing the incidence and
duration of hospitalization in this population.
Following FDA approval, the Company focused on addressing a number of
key issues for the introduction of RespiGam into the marketplace.
First, we began an innovative program called "REACH" (RSV Education and
Counseling Helpline) to provide educational materials to physicians and
parents regarding RSV disease as well as to improve patient compliance.
Prior to the onset of the 1996-1997 RSV season, more than 200 hospitals
had agreed to participate in the REACH program.
Second, we began to address how to assist hospitals with the
complexities of delivering a drug that takes two to four hours to
infuse. Individual hospitals needed to manage their personnel and time
effectively in order to administer RespiGam to multiple patients. We
have worked successfully with hospitals to establish approximately 600
protocols for this purpose and are planning a specific program to
provide hospitals with comprehensive guidelines for administering
successful infusions of RespiGam.
Third, we have worked closely with healthcare providers to understand
the costs and savings associated with use of RespiGam. During 1996,
most large insurance providers and managed care providers approved
RespiGam for reimbursement. In addition, all Medicaid programs in the
United States approved RespiGam for some level of coverage. Recently,
pharmacoeconomic data have been published demonstrating the cost-
effectiveness of RespiGam. The publication showed a favorable profile
for cost per life year saved by using RespiGam, an important outcome in
pharmacoeconomic analyses. As a result of these efforts, there has
been good acceptance of RespiGam by managed care and insurance
organizations, hospitals, physicians, nurses and parents.
Due to the high demand for RespiGam in its first season on the market,
the Company is currently in a backorder situation. This will remain a
critical issue during the first quarter of 1997, but we believe the
Company should have adequate supply for the 1997-1998 RSV season.
The Company has made substantial progress in seeking marketing approval
for RespiGam outside of the United States. During 1996, MedImmune
filed for marketing approval in Canada and has received notice of
priority evaluation status. In addition, Baxter Healthcare
Corporation, MedImmune's partner outside of North America, is expected
to file for marketing approval in Europe during 1997 following
completion of clinical studies this winter.
2. Achieved record product sales of CytoGam for attenuation of
cytomegalovirus (CMV) disease
This past year, the Company continued to achieve sales growth with
CytoGam to more than $18.4 million. CytoGam is the Company's first
marketed product and its first entry into transplantation medicine.
Following launch of the product by MedImmune's hospital-based sales
force in 1993, product sales have grown at a compound annual rate of
approximately 30% per year. CytoGam is marketed for the attenuation of
primary cytomegalovirus (CMV) disease in kidney transplant recipients.
CytoGam remains an important opportunity for the Company. It has
allowed the Company to establish a strong presence with hospitals and
healthcare providers in transplantation medicine and paves the way for
products in development such as MEDI-500 and MEDI-507.
The use of CytoGam in combination with other anti-viral products is
being reviewed to determine if combined use is better than either
product alone in fighting CMV disease. The Company has filed for
marketing approval and is awaiting regulatory action in Canada, Poland,
Hong Kong and Mexico. During 1997, the Company expects to file for
marketing approval in several other European and Latin American
countries. In addition to the United States, CytoGam is currently
approved in Turkey and the Czech Republic.
3. Commenced a Phase 3 clinical trial of MEDI-493, a second generation
product for RSV disease
In November 1996, the Company commenced a Phase 3 clinical trial with
MEDI-493, MedImmune's second generation product for the prevention of
RSV disease. The double-blind, placebo-controlled clinical trial,
called IMpact-RSV, is evaluating MEDI-493 against placebo in 1,502
infants at 139 medical centers in the United States, Canada and the
United Kingdom.
MEDI-493 is an RSV-specific monoclonal antibody. The principal
potential advantage of MEDI-493 is derived from its increased potency
as compared to RespiGam. This quality may allow the same anti-RSV
effect to be delivered in a significantly smaller volume than with
RespiGam. Consequently, MEDI-493 can be administered more rapidly and
simply by intramuscular injection rather than by intravenous infusion.
If MEDI-493 is successfully developed, this advantage could
significantly reduce cost of drug delivery and enhance convenience for
physicians, nurses and parents, thereby improving compliance.
MEDI-493, though still in development, has advanced past a number of
important hurdles. First, the molecule passed a wide variety of
preclinical studies including the ability to neutralize all RSV strains
tested, even those isolated more than 40 years ago. Second, it was
also shown to be safe and 50 to 100 times more potent than RespiGam in
animal studies. Third, our development group has established a
production process that results in high yields. Lastly, results from
Phase 1 and Phase 2 clinical trials during 1995 and 1996, in both
adults and children, have supported the safety and favorable
pharmacokinetics of MEDI-493.
IMpact-RSV should be completed in May 1997 and results are expected to
be announced during the third quarter. It is impossible to determine or
predict the safety or efficacy of MEDI-493 in humans prior to
completion of a large clinical trial. If results demonstrate safety
and efficacy, we plan to file a biologics license application (BLA)
with the FDA before the end of the year. The Company believes that if
results are successful and if regulatory authorities approve MEDI-493,
it will greatly expand the worldwide market opportunity currently
addressed by RespiGam.
4. Commenced a Phase 2 clinical trial of BTI-322 for transplantation
medicine
A Phase 2 clinical trial has begun to evaluate BTI-322, a monoclonal
antibody, in the treatment of acute graft-versus-host disease (GvHD).
This is a potentially life-threatening complication which occurs in
approximately 50% of bone marrow transplants. BTI-322 is being
evaluated by MedImmune and its collaborator, BioTransplant,
Incorporated, in three transplant areas: treatment of rejection,
prevention of rejection (induction) and treatment of GvHD.
A humanized version of the molecule, MEDI-507, has now been developed
not only for clinical study in the above mentioned indications but also
for potential application in medical settings where specific and long-
lasting inhibition of T cells is desired, such as in autoimmune
diseases.
During 1997, the Company will evaluate pre-clinical and clinical
results of BTI-322, MEDI-507 and another transplantation monoclonal
antibody in development, MEDI-500, to determine which of the products
are most appropriate for further clinical evaluation in transplantation
medicine and autoimmune diseases.
5. Received FDA approval to begin a Phase 1 clinical trial of a
vaccine for human papillomavirus (HPV)
Early in 1997, MedImmune began clinical testing of the first vaccine
intended to prevent human papillomavirus (HPV). This product candidate
may represent one of the most significant opportunities in MedImmune's
pipeline and has already generated a great deal of medical and
scientific interest.
Diseases caused by HPV are major causes of morbidity and mortality
worldwide. HPV causes cervical cancer and genital warts in women.
Cervical cancer accounts for some 500,000 cases worldwide and over
4,800 deaths in the United States annually. In regions where screening
via Pap smears is inadequate, cervical cancer represents the leading
cause of cancer death in women. Annual expenditures for treating the
80,000 cases of cervical cancer in the United States are greater than
$600 million. It is estimated that nearly one million new cases of
genital warts due to HPV will be diagnosed each year in both men and
women in the United States at a cost of $600 to $800 per treatment.
HPV is extremely difficult to grow outside the body and the virus
infects only humans. These factors have impeded vaccine development.
MedImmune's strategy for developing an HPV vaccine relies on a virus-
like particle (VLP) technology for producing a structurally identical,
non-infectious form of the virus in vitro. To evaluate this approach,
MedImmune and its collaborators utilized a dog model (canine oral
papillomavirus), which closely mimics human papillomavirus infection.
MedImmune has worked over the past three years to secure a strong
intellectual property position to protect its HPV vaccine strategy.
This has included establishing collaborations and worldwide exclusive
licensing agreements with Georgetown University, the University of
Rochester and the German Cancer Research Center in Heidelberg.
Based on encouraging results in the model system, during 1996 we
completed the activities necessary to begin clinical trials in humans.
A Phase 1 trial of our first HPV vaccine candidate, HPV-11, commenced
in February 1997. We expect to begin clinical trials of an HPV-18
vaccine candidate late in 1997.
6. Raised $125 million in capital
During 1996, the Company raised $116 million in capital through two
offerings. A public offering of common stock in February provided net
proceeds of approximately $58 million. In July, the Company closed an
offering of 7% convertible subordinated notes due 2003 providing net
proceeds of approximately $58 million, primarily to fund certain
capital expenditures associated with the pilot plant and manufacturing
facility. In addition, the Company received commitments for $13.1
million in state and local loans to finance a portion of the
manufacturing facility in Frederick, Maryland. By year end 1996, the
Company had received $9 million from these loans. As a result,
MedImmune is in the strongest financial position in its history.
7. Commenced construction of a $50 million manufacturing facility
In August 1996, the Company began construction of a $50 million
manufacturing facility in Frederick, Maryland. This facility, when
completed, validated and licensed, will be able to produce both
polyclonal and monoclonal antibody products such as CytoGam, RespiGam,
MEDI-493 and MEDI-507. Construction is expected to be completed in
1997, validation will occur in 1998 and we hope to be licensed and
operational during 1999. While this is obviously a significant
financial commitment, the Company believes it will ultimately insure
product supply and reduce the cost of goods as compared to contract
manufacturing.
During early 1997, the Company will also be completing a $6 million
expansion of our Gaithersburg facility to provide additional capacity
for products under clinical evaluation and commercial launch material.
Currently, MEDI-493 launch material is being produced in this facility.
If IMpact-RSV is successful, MedImmune intends to seek FDA licensure of
MEDI-493 in this facility. We will then file an amendment to the
license for transfer of the manufacturing process to Frederick.
We are confident that our commitment to both manufacturing facilities
is essential for the proper and efficient evaluation of product
candidates. It will enhance our ability to control as well as provide
the product capacity, flexibility and speed needed in today's
competitive health care marketplace.
8. Advanced research on several new vaccine candidates
MedImmune has been at the forefront of discovering and testing new Lyme
disease vaccine candidates. In 1996, at the Seventh International
Congress on Lyme Borreliosis in San Francisco, we announced that
decorin binding protein (Dbp) antibodies inhibit growth of many strains
of Borrelia burgdorferi, the spirochete which causes Lyme disease.
These and other results suggest that Dbp could be an improved Lyme
disease vaccine candidate or, alternatively, a supplement to improve
the performance of vaccines currently in development.
MedImmune scientists, in collaboration with researchers from Washington
University in St. Louis and the Karolinska Institute in Stockholm,
Sweden, have made substantial progress in developing a vaccine
candidate to prevent recurrent urinary tract infections (UTIs) caused
by the bacteria, Escherichia coli. Pre-clinical studies are nearing
completion and, if successful, we would expect to move forward with
clinical evaluation.
It has been an exciting and successful year not only on the HPV, Lyme
disease and UTI vaccine programs, but also in our efforts on other
common viral and bacterial infectious diseases including B19 parvovirus
and Streptococcus pneumoniae.
Conclusion
1996 was an exciting year of success beginning with FDA approval of
RespiGam and concluding with a successful launch of the product
resulting in record annual revenues of $41.1 million. As we have
described, there was significant progress toward critical milestones in
all operating areas including sales and marketing, manufacturing,
medical affairs and research and development. These achievements are
the result of the diligent efforts of MedImmune's employees and
collaborators.
Our priorities for 1997 are focused on expanding the commercial base by
seeking to achieve growth in sales of both CytoGam and RespiGam. We
need to solve our product supply shortfall with RespiGam in the short
term and we must complete construction and move toward licensure of the
Frederick manufacturing plant. We are working to increase revenues and
control costs.
1997 will once again be a year of keen interest in clinical studies.
The Company expects to announce the results of a Phase 3 clinical study
of MEDI-493 during the third quarter. If successfully commercialized,
MEDI-493 could be the Company's largest product opportunity to date.
We look forward to the challenges and opportunities of 1997. We thank
our employees and you, our shareholders, for your support.
This announcement may contain, in addition to historical information,
certain forward looking statements that involve risks and
uncertainties. Such statements reflect management's current views and
are based on certain assumptions. Actual results could differ
materially from those currently anticipated as a result of a number of
factors, including risks and uncertainties discussed in the Company's
filings with the U.S. Securities and Exchange Commission. MedImmune
cautions that the safety and effectiveness of MEDI-493 have not been
demonstrated and the outcome of the IMpact-RSV trial cannot be
predicted. Accordingly, there can be no assurance that MEDI-493 will
be licensed for marketing by regulatory authorities.
SIGNATURE
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 thereunto duly authorized.
MEDIMMUNE, INC.
Registrant)
Date: April 14, 1997 David M. Mott
President and Chief Operating Officer
(Principal financial and
accounting officer)
