<PAGE> 1
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM 10-Q
----------------
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE PERIOD ENDED MARCH 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ____________ TO ____________ .
COMMISSION FILE NO. 0-21905
COULTER PHARMACEUTICAL, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 94-3219075
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
600 GATEWAY BOULEVARD,
SOUTH SAN FRANCISCO, CALIFORNIA 94080
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 650-553-2000
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes [X] No [ ]
Number of shares outstanding of the issuer's Common Stock, par value
$.001 per share, as of April 30, 1999: 16,762,478.
================================================================================
<PAGE> 2
COULTER PHARMACEUTICAL, INC.
INDEX
<TABLE>
<CAPTION>
PAGE NO.
--------
<S> <C> <C>
PART I. FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements and Notes................................... 3
Consolidated Balance Sheets -- March 31, 1999 and December 31, 1998.......... 3
Consolidated Statements of Operations -- for the three months ended March 31,
1999 and 1998 and for the period from inception (February 16, 1995) to
March 31, 1999.............................................................. 4
Consolidated Statements of Cash Flows -- for the three months ended March 31,
1999 and 1998 and for the period from inception (February 16, 1995) to
March 31, 1999.............................................................. 5
Notes to Consolidated Financial Statements.................................... 6
Item 2. Management's Discussion and Analysis of Financial Condition and Results of
Operations.................................................................. 8
Item 3. Quantitative and Qualitative Disclosures about Market Risk.................... 11
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.............................................. 12
SIGNATURES................................................................................ 13
</TABLE>
2
<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS AND NOTES
COULTER PHARMACEUTICAL, INC.
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Share and Per Share Amounts)
<TABLE>
<CAPTION>
ASSETS
MARCH 31, DECEMBER 31,
1999 1998
--------- ---------
(UNAUDITED) (NOTE 1)
<S> <C> <C>
Current assets:
Cash and cash equivalents ....................................... $ 15,456 $ 89,808
Short-term investments .......................................... 109,238 49,970
Prepaid expenses and other current assets ....................... 4,768 3,063
--------- ---------
Total current assets .................................... 129,462 142,841
Property and equipment, net ....................................... 12,791 9,449
Employee loans receivable ......................................... 866 907
Other assets ...................................................... 499 233
--------- ---------
$ 143,618 $ 153,430
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable ................................................ $ 4,507 $ 4,068
Accrued liabilities ............................................. 7,191 6,353
Current portion of equipment financing obligations and debt
facility ..................................................... 1,513 1,157
--------- ---------
Total current liabilities ............................... 13,211 11,578
Non current portion of equipment financing obligations and debt
facility ........................................................ 6,208 6,659
Commitments
Stockholders' equity:
Preferred stock, issuable in series, $.001 par value: 20,000,000
shares authorized; none outstanding at
March 31, 1999 and December 31, 1998 ......................... -- --
Common stock, $.001 par value: 30,000,000 shares authorized;
16,759,229 shares and 16,704,103 shares issued and outstanding
at March 31, 1999 and December 31, 1998, respectively ........ 17 17
Additional paid-in capital ...................................... 182,677 182,390
Accumulated other comprehensive income .......................... (21) (32)
Deferred compensation ........................................... (452) (565)
Deficit accumulated during the development stage ................ (58,022) (46,617)
--------- ---------
Total stockholders' equity .............................. 124,199 135,193
--------- ---------
$ 143,618 $ 153,430
========= =========
</TABLE>
See accompanying notes.
3
<PAGE> 4
COULTER PHARMACEUTICAL, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In Thousands, Except Per Share Data)
<TABLE>
<CAPTION>
THREE MONTHS ENDED FOR THE PERIOD
MARCH 31, FROM INCEPTION
---------------------------- (FEBRUARY 16, 1995)
1999 1998 TO MARCH 31, 1999
--------- --------- -------------------
<S> <C> <C> <C>
Corporate partner revenues .......... $ -- $ -- $ 34,250
Operating expenses:
Research and development ............ $ 9,013 $ 9,017 $ 74,976
Selling, general and administrative . 3,271 2,160 25,629
--------- --------- ---------
Total operating expenses ............ 12,284 11,177 100,605
Interest income and other, net ...... 879 912 8,333
--------- --------- ---------
Net loss ............................ $ (11,405) $ (10,265) $ (58,022)
========= ========= =========
Basic and diluted net loss per
share ............................. $ (0.69) $ (0.77)
========= =========
Shares used in computing basic and
diluted net loss per share ........ 16,590 13,377
========= =========
</TABLE>
See accompanying notes.
4
<PAGE> 5
COULTER PHARMACEUTICAL, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(Unaudited)
(In Thousands)
<TABLE>
<CAPTION>
THREE MONTHS FOR THE PERIOD
ENDED MARCH 31, FROM INCEPTION
---------------------------- (FEB. 16, 1995)
1999 1998 TO MARCH 31, 1999
--------- --------- -----------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss ............................................. $ (11,405) $ (10,265) $ (58,022)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation and amortization ..................... 380 98 1,403
Amortization of deferred compensation ............. 113 81 2,204
Loss on sale of equipment ......................... 38 -- 38
Changes in operating assets and liabilities:
Prepaid expenses and other current assets ......... (1,705) (222) (4,768)
Employee loans receivable ......................... 41 24 (866)
Other assets ...................................... (266) -- (499)
Accounts payable .................................. 439 (368) 4,507
Accrued liabilities ............................... 838 3,008 7,280
--------- --------- ---------
Net cash used in operating activities ........ (11,527) (7,644) (48,723)
--------- --------- ---------
Cash flows from investing activities:
Purchases of short-term investments .................. (95,108) (32,432) (249,848)
Maturities of short-term investments ................. 32,852 25,984 130,243
Sales of short-term investments ...................... 2,999 5,074 10,342
Purchases of property and equipment .................. (3,765) (408) (14,234)
Proceeds from sale of equipment ...................... 5 -- 5
--------- --------- ---------
Net cash used in investing activities ........ (63,017) (1,782) (123,492)
--------- --------- ---------
Cash flows from financing activities:
Payments of equipment financing obligations and
debt facility ..................................... (95) (175) (1,487)
Borrowings under equipment financing obligations
and debt facility ................................. -- 33 9,120
Proceeds from issuance of convertible preferred
stock, net ........................................ -- -- 28,355
Proceeds from issuance of common stock, net .......... 287 148 151,683
--------- --------- ---------
Net cash provided by financing activities .... 192 6 187,671
--------- --------- ---------
Net increase (decrease) in cash and cash
equivalents .......................................... (74,352) (9,420) 15,456
Cash and cash equivalents at beginning of period ....... 89,808 20,451 --
--------- --------- ---------
Cash and cash equivalents at end of period ............. $ 15,456 $ 11,031 $ 15,456
========= ========= =========
Supplemental Schedule of Cash Flow Information
Interest Paid .......................................... $ 178 $ 85 846
Schedule of non-cash investing and financing activities:
Net exercise of warrants to purchase common stock .... $ -- $ -- $ 965
Acquisition of equipment pursuant to supplemental
lease obligation .................................. $ -- $ -- $ 78
Deferred compensation related to grant of certain
stock options ..................................... $ -- $ 102 $ 2,656
</TABLE>
See accompanying notes.
5
<PAGE> 6
COULTER PHARMACEUTICAL, INC.
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1999
(Unaudited)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The information at March 31, 1999, for the three month periods ended March
31, 1999 and 1998 and for the period from inception (February 16, 1995) to March
31, 1999 is unaudited but includes all adjustments (consisting only of normal
recurring adjustments) which, in the opinion of management, are necessary to
state fairly the financial information set forth therein in accordance with
generally accepted accounting principles. The March 31, 1999 interim results are
not necessarily indicative of results to be expected for the full fiscal year.
These financial statements should be read in conjunction with the audited
financial statements for the fiscal year ended December 31, 1998 included in the
Company's annual report to security holders furnished to the Securities and
Exchange Commission pursuant to Rule 14a-3(b) in connection with the Company's
1999 Annual Meeting of Stockholders.
The consolidated balance sheet at December 31, 1998 has been derived from
audited consolidated financial statements at that date but does not include all
of the information and footnotes required by generally accepted accounting
principles for complete financial statements.
2. INVESTMENTS
Management determines the appropriate classification of debt securities at
the time of purchase and re-evaluates such designation as of each balance sheet
date. The Company's debt securities are classified as available-for-sale and are
carried at estimated fair value in cash equivalents and short-term investments.
Unrealized gains and losses are reported as accumulated other comprehensive
income in stockholders' equity. The amortized cost of debt securities in this
category is adjusted for amortization of premiums and accretion of discounts to
maturity. Such amortization is included in interest income. Realized gains and
losses on available-for-sale securities are included in interest income and
expense. The cost of securities sold is based on the specific identification
method. Interest and dividends on securities classified as available-for-sale
are included in interest income. The Company's cash equivalents and short-term
investments as of March 31, 1999 are as follows (in thousands):
<TABLE>
<CAPTION>
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED ESTIMATED
COST GAINS LOSSES FAIR VALUE
--------- ---------- --------- ----------
<S> <C> <C> <C> <C>
Money market funds ......................... $ 10,243 $ -- $ -- $ 10,243
Commercial paper ........................... 35,779 29 (4) 35,804
Corporate bonds ............................ 20,046 2 (39) 20,009
Government bonds ........................... 38,194 2 -- 38,196
Certificate of deposits .................... 20,207 -- (11) 20,196
--------- --------- --------- ---------
Total ............................ 124,469 33 (54) 124,448
Less amounts classified as cash equivalents (15,214) -- 4 (15,210)
--------- --------- --------- ---------
Total short-term investments ............... $ 109,255 $ 33 $ (50) $ 109,238
========= ========= ========= =========
</TABLE>
Realized gains or losses on the sale of available-for-sale securities for
the quarters ended March 31, 1999 and March 31, 1998 were not material.
At March 31, 1999 the contractual maturities of short term investments were
as follows (in thousands):
<TABLE>
<CAPTION>
ESTIMATED FAIR
AMORTIZED COST VALUE
-------------- --------------
<S> <C> <C>
Due in one year or less............... $ 78,868 $ 78,869
Due after one year ................... 30,387 30,369
-------- --------
$109,255 $109,238
======== ========
</TABLE>
6
<PAGE> 7
3. COLLABORATIVE DEVELOPMENT AND COMMERCIALIZATION AGREEMENTS
In December 1998, the Company and SmithKline Beecham Corporation ("SB")
entered into a collaborative agreement for the development and commercialization
of Bexxar, which is in late-stage development for the treatment of non-Hodgkin's
lymphoma. Under the terms of the agreement, Coulter may receive
milestone payments, shared profits and royalties. The agreement also provides
for the sharing of certain costs related to clinical development, manufacturing
development, and sales & marketing costs. The Company and SB will prepare a
joint profit & loss statement to account for the sharing of sales, cost of goods
sold, and costs related to selling, marketing, distribution and certain other
Bexxar-related activities.
The agreement provides for an upfront non-refundable license fee of $34.25
million and the purchase of $7.25 million of the Company's common stock. The
license fee was recognized as corporate partner revenues in fiscal year 1998. In
addition, the agreement provides for a $15.0 million credit line. The Company
may receive additional payments based upon completion of certain milestones.
Future development expenses for Bexxar will generally be shared by both
companies, with the Company retaining responsibility for funding certain
predetermined development costs. In addition, the companies will jointly explore
the potential of other indications for the product. If approved, the Company and
SB will jointly market Bexxar in the United States and share profits and losses
equally. Outside the United States, excluding Japan, the Company has granted SB
exclusive marketing and distribution rights in return for product royalties. SB
may also have access to second generation anti-CD20 compounds.
4. COMPREHENSIVE INCOME
As of January 1, 1998, the Company adopted Statement of Financial
Accounting Standards No. 130, "Reporting Comprehensive Income". For the three
months ended March 31, 1999 and 1998 total comprehensive loss amounted to $11.4
million and $10.3 million, respectively.
7
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion contains, in addition to historical information,
forward-looking statements that involve risks and uncertainties. Actual results
may differ significantly from the results discussed in the forward-looking
statements. Factors that could cause or contribute to such differences include,
but are not limited to, those discussed below and in the Annual Report on Form
10-K for the year ended December 31, 1998, filed on March 29, 1999.
OVERVIEW
Coulter Pharmaceutical is engaged in the development of novel drugs and
therapies for the treatment of people with cancer. The Company currently is
developing cancer therapeutics based upon two drug discovery programs:
therapeutic antibodies and targeted oncologics. Within these broad drug
discovery programs, the Company is currently concentrating on two distinct
platform technologies: therapeutic antibodies based on conjugated antibody
technology and targeted oncologics based on tumor activated peptide pro-drug
technology.
The Company's most advanced product candidate, Bexxar(TM) (formerly known
as the "B-1 Therapy"), consists of a monoclonal antibody conjugated with a
radioisotope. The Company intends to seek initial approval of Bexxar for the
treatment of low-grade and transformed low-grade non-Hodgkin's lymphoma in
patients who have relapsed after, or are refractory to, chemotherapy. The
Company intends to seek expedited Biologics License Application review and
marketing approval for Bexxar, while simultaneously pursuing clinical trials to
expand the potential use of Bexxar to other indications. The Company announced
in December 1998, that the United States Food and Drug Administration had
designated Bexxar as a Fast Track Product for which the agency will take
appropriate actions to potentially expedite development and review. Also in
December 1998, the Company announced a joint collaboration agreement with SB
granting SB joint marketing rights in the United States and exclusive commercial
rights internationally, except Japan, in return for a non-refundable license fee
of $34.3 million, potential product royalties, development milestone payments
and other shared development payments.
To date, the Company has devoted substantially all of its resources to
research and development programs, as well as selling, general and
administrative activities needed to support product development and potential
product sales. No revenues have been generated from product sales, and product
revenues resulting from the Company's research and development efforts will not
occur until commercial availability of such product. The Company has a limited
history of operations and has experienced significant operating losses to date.
The Company may continue to incur significant additional operating losses in
future periods and expects cumulative losses to increase substantially if
anticipated product sales do not offset the projected costs associated with
expanded research and development efforts, preclinical studies and clinical
trials and development of manufacturing, marketing and sales capabilities. The
Company expects that losses will fluctuate from quarter to quarter and that such
fluctuations may be substantial. There can be no assurance that the Company will
successfully develop, manufacture and commercialize its products or ever achieve
or sustain product revenues or profitability. As of March 31, 1999, the
Company's accumulated deficit was approximately $58.0 million.
RESULTS OF OPERATIONS
Operating Costs and Expenses
Research and development expenses were $9.0 million for the three-month
periods ended March 31, 1999 and 1998. While the overall expense did not change
significantly year over year, personnel and facilities costs in the first
quarter of 1999 were significantly higher than the same period in 1998 which
included higher levels of certain expenses associated with developing production
capabilities for the monoclonal antibody. The Company expects its research and
development expenses to grow during the remainder of 1999, reflecting
anticipated increased costs related to additions to staffing, preclinical
studies, clinical trials and manufacturing.
Selling, general and administrative expenses were $3.3 million for the quarter
ended March 31, 1999, compared to $2.2 million for the same period in 1998. This
increase was incurred to support the Company's facilities and staffing
expansion, sales and marketing efforts, increased pre-commercialization
activities, increased corporate development activities and related legal and
patent activities. The Company expects its selling, general and administrative
expenses to continue to increase during the remainder of 1999 in continued
support of these activities.
8
<PAGE> 9
Interest Income and Other, Net
Interest income and other, net was $879,000 for the quarter ended March 31,
1999, compared to $912,000 for the same period in 1998. This decrease was due to
expenses related to the unconsolidated joint venture with SB, partially offset
by higher interest income on higher average cash, cash equivalents and
short-term investment balances as a result of the completion of the Company's
public offering of common stock in July 1998 and amounts received from SB in
connection with the joint collaboration agreement. Interest expense is not
material for any period presented.
LIQUIDITY AND CAPITAL RESOURCES
Since its inception through March 31, 1999, the Company has financed its
operations primarily through private placements and public offerings of equity
securities totaling $180.0 million. Cash, cash equivalents and short-term
investments totaled $124.7 million at March 31, 1999.
The negative cash flow from operations results primarily from the Company's
net operating losses and is expected to continue and to accelerate in future
periods. The Company expects to incur substantial and increasing research and
development expenses, including expenses related to additions to personnel,
preclinical studies, clinical trials, manufacturing and commercialization
efforts. The Company may need to raise substantial additional capital to fund
its operations. The Company may seek such additional funding through public or
private equity or debt financings from time to time, as market conditions
permit. There can be no assurance that additional financing will be available on
acceptable terms, if at all. If adequate funds are not available, the Company
may be required to delay, reduce the scope of, or eliminate one or more of its
research and development programs or obtain funds through arrangements with
collaborative partners or others that may require the Company to relinquish
rights to certain of its technologies, product candidates or products that the
Company would otherwise seek to develop or commercialize.
Net cash used in operations was $11.5 million for the three months ended
March 31, 1999, compared to $7.6 million for the same period in 1998. This $3.9
million increase is primarily the result of the increased net loss for the 1999
period and an increase in other current assets which relates to receivables from
activities under the SB collaboration agreement. Net cash used in investing
activities was $63.0 million for the three months ended March 31, 1999 compared
to $1.8 million for the same period in 1998. This increase primarily resulted
from the purchase of $95.1 million of short-term investments offset by an
increase in maturities. Property and equipment purchases of $3.8 million in the
three months ended March 31, 1999 were in support of the Company's facilities
expansion and staffing growth. Net cash provided by financing activities
increased to $192,000 for the three months ended March 31, 1999 from $6,000 for
the same period in 1998 primarily resulting from higher proceeds from issuance
of common stock and lower payments on financing obligations .
The Company expects that its existing capital resources, including the net
proceeds of its public offerings and interest thereon, will be adequate to
satisfy the requirements of its current and planned operations through 2000. The
Company has entered into a long-term lease obligation for office and laboratory
space that will require material commitments for capital expenditures. The
Company's future capital requirements will depend on a number of factors,
including: the scope and results of preclinical studies and clinical trials;
continued progress of the Company's research and development of potential
products; the cost, timing and outcome of regulatory approvals; the expenses of
establishing a sales and marketing force; the timing and cost of establishment
or procurement of requisite production, radiolabeling and other capacities; the
cost involved in preparing, filing, prosecuting, maintaining, defending and
enforcing patent claims; the need to acquire licenses to new technology; the
status of competitive products; the availability of other financing and the
ability to achieve profitability.
9
<PAGE> 10
YEAR 2000 READINESS
The Company uses and relies on a wide variety of information technologies,
computer systems and scientific equipment containing computer related
components. Some of the Company's older computer software programs and equipment
use two digit fields rather than four digit fields to define the applicable year
(i.e., "98" in the computer code refers to the year "1998"). As a result,
time-sensitive functions of those software programs and equipment may
misinterpret dates after January 1, 2000, to refer to the twentieth century
rather than the twenty-first century (i.e., "02" could be interpreted as "1902"
rather than "2002"). This could cause system or equipment shutdowns, failures or
miscalculations resulting in inaccuracies in computer output or disruptions of
operations, including, among other things, inaccurate processing of financial
information and/or temporary inability to process transactions or engage in
other normal business activities.
The Company has developed a strategy to address the potential exposures
related to the impact on its computer systems for the Year 2000 and beyond. An
inventory of key financial, informational and operational systems is being
completed. Detailed plans for implementation and testing of any necessary
modifications to these key computer systems and equipment to ensure they are
Year 2000 compliant are being developed by a cross functional team to address
computer system and equipment problems as required by December 31, 1999. The
Company believes that with these plans and completed modifications, the Year
2000 issue will not pose significant operational problems for its computer
systems and equipment. However, if such modifications and conversions are not
made, or are not completed in a timely fashion, the Year 2000 issue could have a
material impact on the operations of the Company, the precise degree of which
cannot be known at this time. The Company currently has no contingency plans to
deal with major Year 2000 failures, though such plans, if necessary, will be
developed by September 1, 1999. The Company does not expect the resources
required to be devoted to Year 2000 compliance to cause significant delay in
other projects. The Company is currently considering the need for external
verification of its Year 2000 readiness and that of its partners.
In addition to risks associated with the Company's own computer systems and
equipment, the Company has relationships with, and is to varying degrees
dependent upon, a large number of third parties that provide information, goods
and services to the Company. These include financial institutions, suppliers,
vendors, research partners and governmental entities. If a significant number of
these third parties experience failures in their computer systems or equipment
due to Year 2000 non-compliance, it could affect the Company's ability to
process transactions, develop, manufacture and distribute products, or engage in
similar normal business activities. While some of these risks are outside the
control of the Company, the Company has instituted programs, including internal
records review and use of external questionnaires, to identify key third
parties, assess their level of Year 2000 compliance, update contracts and
address any non-compliance issues.
The total cost of the Year 2000 systems assessments and conversions is
funded through operating cash flows, and the Company is expensing these costs.
The financial impact of making the required systems changes and ensuring that
key third-parties are Year 2000 compliant is not known precisely at this time,
but it is currently expected to be less than $1.0 million. The cost incurred to
date is less than $75,000. The actual financial impact could, however, exceed
this estimate. These costs are not expected to be material to the Company's
financial position, results of operations or cash flows.
BUSINESS RISKS
Except for the historical information contained herein, the matters
discussed in this filing are forward-looking statements that involve risks and
uncertainties, including uncertainties related to product development,
uncertainties related to the need for regulatory and other government approvals,
dependence on proprietary technology, uncertainty of market acceptance of Bexxar
or the Company's other product candidates and other risks, including those
detailed in the Company's other filings with the Securities and Exchange
Commission. In particular, see "Risk Factors," referenced in the Company's
Annual Report on Form 10-K for the year ended December 31, 1998, filed on March
29, 1999.
10
<PAGE> 11
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
In the normal course of business, the financial position of the Company is
routinely subjected to a variety of risks, including market risk associated with
interest rate movements and currency rate movements on non-United States dollar
denominated assets and liabilities. The Company regularly assesses these risks
and has established policies and business practices to protect against the
adverse effects of these and other potential exposures. As a result, the Company
does not anticipate material losses in these areas.
Interest Rates -- The Company's interest income is sensitive to changes in
the general level of interest rates, primarily United States interest rates. In
this regard, changes in United States interest rates affect the interest earned
on the Company's cash equivalents and short-term investments. Based on the
Company's overall interest rate exposure at March 31, 1999, a near-term change
in interest rates, based on historical movements, would not materially affect
the fair value of interest rate sensitive instruments.
Foreign Currency Exchange Rates -- The Company has certain liabilities
which are denominated in several European currencies. As a result, the Company's
financial results could be significantly affected by factors such as changes in
foreign currency exchange rates or economic conditions in the foreign markets in
which the Company's suppliers are located. To mitigate this risk, the Company
may enter into foreign currency forward contracts as is deemed necessary by
management. Based on the Company's overall currency rate exposure at March 31,
1999, a near-term change in currency rates, based on historical currency rate
movements, would not materially affect the value of foreign currency sensitive
liabilities.
The Company invests cash which is not currently being used for operational
purposes in accordance with its investment policy. This policy allows for the
purchase of low risk securities issued by the government agencies and very
highly rated banks and corporations subject to certain concentration limits. The
maturities of these securities are maintained at less than two years. The
following table presents the amounts and related weighted average interest rates
by year of maturity for the Company's investment portfolio and long term debt
obligations at March 31, 1999.
<TABLE>
<CAPTION>
1999 2000 2001 2002 2003 THEREAFTER TOTAL
----------- ------- --------- -------- --------- ----------- --------
(Dollars In Thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
Cash Equivalent Investments:
Fixed Rate.................. $15,456 -- -- -- -- -- $15,456
Average Interest Rate....... 4.6% -- -- -- -- -- --
Short Term Investments:
Fixed Rate.................. 69,110 29,505 10,623 -- -- -- 109,238
Average Interest Rate....... 5.0% 5.2% 5.6% -- -- -- --
Long-term debt, including
current portion:
Variable Rate............... 119 714 714 714 2,739 -- 5,000
Average Interest Rate....... 8.75% 8.75% 8.75% 8.75% 8.75% -- --
</TABLE>
11
<PAGE> 12
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
<S> <C>
27.1 Financial data Schedule
</TABLE>
(b) Reports on Form 8-K
There were no reports on Form 8-K during the quarter ended March 31, 1999.
12
<PAGE> 13
SIGNATURES
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.
COULTER PHARMACEUTICAL, INC.
Date: May 13, 1999 /s/ MICHAEL F. BIGHAM
-----------------------------------------------
Michael F. Bigham
President and Chief Executive Officer
Date: May 13, 1999 /s/ WILLIAM G. HARRIS
-----------------------------------------------
William G. Harris
Vice President and Chief Financial Officer
13
<PAGE> 14
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
<S> <C>
27.1 Financial data Schedule
</TABLE>
14
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 15,456
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0
0
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</TABLE>
