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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 July 24, 1997
(Date of earliest event reported)
COLLABORATIVE CLINICAL RESEARCH, INC.
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(Exact name of registrant as specified in its charter)
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<CAPTION>
<S> <C> <C> <C>
Ohio (000-20699) 34-1685364
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(State or other jurisdiction of (Commission File No.) (I.R.S. Employer
incorporation) Identification No.)
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20600 Chagrin Boulevard, Cleveland, Ohio 44122
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (216) 491-9930
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Page 1 of 3 Pages
Exhibit Index Appears on Page 3
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Item 5. Other Events
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On July 24, 1997 Collaborative Clinical Research, Inc., reported financial
results for the three-month and the six-month periods ended June 30, 1997. For
the three-month period ended June 30, 1997, Collaborative reported a net loss of
($486,496) or ($0.08) per share. For the six-month period ended June 30, 1997,
Collaborative reported a net loss of ($904,882) or ($0.14) per share. The
Company's backlog currently stands at $24.6 million, compared $22.5 million at
December 31, 1996 and $20.3 million one year ago.
The Company's press release announcing its results for the three-month and the
six-month periods ended June 30, 1997, including the financial information set
forth therein, is attached as exhibit 99 to this report, and is incorporated
herein by reference.
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.
COLLABORATIVE CLINICAL RESEARCH, INC.
By: /s/ Terry C. Black
----------------------------------------------------
Terry C. Black
Vice President of Finance, Chief Financial
Officer, Treasurer, and Assistant Secretary
Date: July 25, 1997
Page 2 of 3 Pages
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EXHIBIT INDEX
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EXHIBIT NO. DESCRIPTION PAGE
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99 Press Release Issued by the Company
on July 24, 1997.
Page 3 of 3 Pages
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FOR IMMEDIATE RELEASE:
COLLABORATIVE CLINICAL RESEARCH, INC. ANNOUNCES
SECOND QUARTER AND SIX MONTH RESULTS
Cleveland, Ohio, July 24, 1997--Collaborative Clinical Research, Inc.,
(NASDAQ:CCLR) today reported financial results for the second quarter and first
half of 1997.
For the second quarter of 1997, Collaborative reported revenues of
$4,459,000 and a net loss of $(486,000), or $(0.08) per share. These financial
results are down in comparison to revenues of $6,842,000 and net income of
$288,000, or $0.08 per share, for the second quarter of 1996.
For the first six months of 1997, revenues were $9,037,000 and the net
loss was $(905,000), or $(0.14) per share, after recognizing expenses of
$300,000, or approximately $0.05 per share, related to the terminated
negotiations for Collaborative to acquire U-Gene Research BV. These financial
results are down in comparison to revenues of $12,144,000 and net income of
$344,000, or $0.10 per share, for the first six months of 1996.
Backlog currently stands at $24.6 million, compared to backlog of $20.3
million one year ago. The Company's backlog is composed of a number of large
contracts, each with a different term and duration. As is customary, these
contracts are subject to modification and/or possible cancellation. Therefore,
the amount of backlog is not necessarily indicative of the Company's future
quarterly or annual revenues.
Dr. Jeffrey A. Green, President and Chief Executive Officer of
Collaborative, stated, "We are disappointed in reporting a loss. The revenue
decline in both the second quarter and the first half of 1997 compared to the
comparable periods of last year reflects the fact that Collaborative's backlog
remains below our goal. We added a senior level sales person during the second
quarter, and we are looking to add more sales people. Based on current business
levels, we do not anticipate that Collaborative will report a profit in either
the third or the fourth quarters of 1997. In addition to the steps we are taking
to address our backlog and performance issues, we have retained a financial
advisor to assist us with our merger and acquisition activities, and with
strategic joint venture alliances intended to further build our full-service
capabilities."
"We remain dedicated to rebuilding our upward momentum," Dr. Green
concluded. "Our network based access model is increasingly being validated
across the industry and we are working to address quality and performance issues
within our Network. DataTRAKSM will assist in this effort by bringing a new
level of near-real time quality assessment to clinical research. The DataTRAK
Process offers the potential of a true competitive advantage in this industry
and is being recognized by Sponsors as possessing the capability to accelerate
drug development timelines. The roll out of DataTRAK is continuing and will
require ongoing financial support. In the second quarter, our dedication to
DataTRAK included the investment of one million dollars as well as expenses
incurred of approximately $0.02 per share. The first revenue trial utilizing
DataTRAK is expected to begin in September with a major pharmaceutical company."
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Collaborative Clinical Research, Inc., manages a network
comprised of over 540 affiliated multitherapeutic clinical research sites
providing access to over 3,700 principal investigators in the United States,
Canada and the United Kingdom. In addition, through the GFI and Walker
acquisitions, the Company operates five research facilities, conducts Phase I
through Phase IV clinical research and provides clinical reference laboratory
and Institutional Review Board services. DataTRAK is the product of a joint
venture between Collaborative and IBM Global Services, to develop and market an
electronic data collection and project management system for use in clinical
trials.
Except for the historical financial information contained in this press release,
the statements made in this release are forward-looking statements. Factors that
may cause actual results to differ materially from those in the forward-looking
statements include the degree of the Company's success in obtaining new
contracts, the size and duration of clinical trials in which the Company and
members of its network of affiliate sites participate and the timing of sponsor
decisions to conduct new clinical trials or cancel or delay ongoing trials. In
addition, the Company's success depends on the various strategic initiatives
that it has undertaken, all of which are based on assumptions made by the
Company concerning trends in the clinical research market and the health care
industry.
CONTACT: Philip A. Stark
Vice President, Corporate Development
Collaborative Clinical Research, Inc.
216/491-9930
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COLLABORATIVE CLINICAL RESEARCH, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET DATA
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June 30, 1997 December 31, 1996
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Cash and investments $34,452,052 $34,683,196
Accounts receivable, net 5,805,192 8,420,539
Goodwill, net 7,923,982 8,131,875
Other 3,827,825 2,450,983
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Total assets $52,009,051 $53,686,593
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Accounts payable and other current liabilities $ 3,188,902 $ 4,138,805
Shareholders' equity 48,820,149 49,547,788
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Total liabilities and shareholders' equity $52,009,051 $53,686,593
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COLLABORATIVE CLINICAL RESEARCH, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
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For the Three Months Ended June 30,
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1997 1996
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Revenue $ 4,458,869 $ 6,842,221
Direct costs 3,218,481 4,830,545
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Gross profit 1,240,388 2,011,676
Selling, general and administrative expenses 2,112,284 1,520,903
Depreciation and amortization 242,212 143,755
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Income (loss) from operations (1,114,108) 347,018
Other income (expense):
Interest income 522,167 86,624
Interest expense ---- (57,349)
Income (loss) from joint venture 6,449 7,219
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Income (loss) before tax provision (benefit) (585,492) 383,512
Tax provision (benefit) (98,996) 95,800
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Net income (loss) ($ 486,496) $ 287,712
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Net income (loss) per share ($ 0.08) $ 0.08
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Weighted average common shares outstanding 6,384,362 3,770,558
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COLLABORATIVE CLINICAL RESEARCH, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
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For the Six Months Ended June 30,
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1997 1996
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<S> <C> <C>
Revenue $ 9,037,153 $ 12,144,437
Direct costs 6,389,288 8,843,152
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Gross profit 2,647,865 3,301,285
Selling, general and administrative expenses 4,125,486 2,613,516
Depreciation and amortization 468,405 243,193
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Income (loss) from operations (1,946,026) 444,576
Other income (expense):
Interest income 989,936 104,517
Interest expense -- (93,616)
Income (loss) from joint venture (47,788) 2,700
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Income (loss) before tax provision (benefit) (1,003,878) 458,177
Tax provision (benefit) (98,996) 114,500
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Net income (loss) ($ 904,882) $ 343,677
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Net income (loss) per share ($ 0.14) $ 0.10
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Weighted average common shares outstanding 6,363,466 3,433,942
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