Guilford says losses more than doubled

Pharmaceuticals company ended 1998 $29 million in the red

February 17, 1999|By Mark Guidera | Mark Guidera,SUN STAFF

Guilford Pharmaceuticals Inc. reported yesterday that its net loss more than doubled last year.

Guilford's president, Dr. Craig Smith, said he expects three experimental drugs to move into human clinical trials this year.

For the year that ended Dec. 31, the Baltimore-based bio-pharmaceutical concern said it had a $29.7 million net loss, or $1.52 per share, compared with a net loss of $11.4 million, or 65 cents per share, in 1997.

The company said the larger loss resulted in part from a one-time $15 million payment from California-based Amgen Inc. for a licensing agreement that was included in the 1997 results. Under that deal, Amgen obtained rights to develop and market a group of experimental drug compounds called neuroimmunophilin ligands, which have shown promise in nerve regeneration.

Guilford said higher research and development costs last year -- $37.7 million compared with $30.3 million in 1997 -- also contributed to the larger loss.

The company reported that royalty revenue from sales of Gliadel, a brain tumor treatment, rose 69 percent to $2.7 million in 1998, up from $1.6 million in 1997.

Collegeville, Pa.-based Rhone-Poulenc Rorer Inc. licensed the rights to market Gliadel, a chemotherapy-loaded wafer that has been approved in the United States, Canada and eight other countries for use in slowing tumor recurrence after surgery for an aggressive form of brain cancer. Gliadel is Guilford's only approved drug product.

Smith, who is also Guilford's chief executive officer, said higher royalties resulted from stronger Gliadel sales by Rohne-Poulenc to hospitals. Rhone-Poulenc reported Gliadel sales of $17.8 million last year, up from $11 million in 1997.

While royalty revenue from Gliadel rose, sales of the wafers to Rhone-Poulenc declined last year to $3.9 million from $5.7 million in 1997, Guilford reported. Guilford said the decline resulted from Rhone-Poulenc's stocking up on the product in 1997.

The company also booked $4.9 million in revenue last year for research conducted under its agreement with Amgen. In 1997, Guilford recorded $1.5 million in research payments.

Smith told analysts and investors during a telephone conferance call yesterday that "1999 could be an excellent year for us."

Among the developments the company expects this year, said Smith, are the launch by Amgen of human tests in the United States of its lead nerve regeneration drug developed from neuroimmunophilins. The drug will be tried on patients suffering from Parkinson's disease. If Amgen files for Food and Drug Administration approval to use the drug on patients as an investigational therapy, it would trigger a $5 million payment to Guilford.

Smith also said the company expects to begin human trials this year on an injectable form of the potent agent paclitaxel as a treatment for ovarian cancer and on an experimental neuro-protective drug for treating stroke.

Guilford shares closed yesterday at $13.1875, up 6.25 cents.

Pub Date: 2/17/99

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