Guilford's loss widens in 4Q, from 46 cents to 50 cents a share

Failure to win FDA OK on drug continues to hurt

February 14, 2003|By Julie Bell | Julie Bell,SUN STAFF

Guilford Pharmaceuticals Inc. said yesterday that its fourth-quarter loss widened to $15.1 million as sales of its Gliadel brain-cancer treatment fell.

The Baltimore company said the loss, equivalent to 50 cents per share, expanded from $13.8 million, or 46 cents per share, in the 2001 quarter. Revenue plummeted to $1.6 million from $6.8 million after buyers, who had overstocked Gliadel earlier in the year, let inventories fall back in line with demand.

Analysts had expected even worse results, predicting a loss of 59 cents a share, according to the average estimate of five analysts surveyed by Thomson Financial/First Call.

Gliadel sales spiked early last year in anticipation that the Food and Drug Administration would approve wider use of it. The FDA instead rejected Guilford's application to market Gliadel for implantation during a patient's first brain-cancer surgery.

The product, a dissolvable wafer packed with a chemotherapy drug, is implanted in the cavity left after a surgeon removes a tumor. It currently is approved for use only in second surgeries necessitated when a particularly aggressive kind of tumor, known as malignant glioma, has grown back.

But Guilford has since submitted additional data to the FDA showing that Gliadel appears to give patients an increased chance of survival that persists three to four years after it is implanted during an initial surgery. Now, Guilford is hoping the agency will approve Gliadel's expanded use this spring.

"Based on our discussions with FDA, we're optimistic about the prospects for an approval of our original ... application in the near term," Guilford Chief Executive Officer Craig R. Smith said yesterday during a conference call with analysts.

Legg Mason Wood Walker analyst Stefan D. Loren has two models of projected revenue for Guilford. One, which assumes Gliadel will win expanded marketing in April, projects sales this year of almost $20 million. The other, which assumes the FDA will again reject the application, estimates sales of $13.5 million.

Brian D. Rye, an analyst with Raymond James & Associates, said he remains guardedly optimistic that approval will come. But, he said, "My only caveat is that I was optimistic at this time last year."

Guilford also said it had started a Phase II test of its Aquavan anesthetic in colonoscopy patients.

Guilford shares fell 7 cents to close at $3.07.

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