EntreMed cuts 4Q loss to 7 cents per share

Costs, debt are lowered

rights sale bolsters coffers

March 05, 2003|By Julie Bell | Julie Bell,SUN STAFF

EntreMed Inc. said yesterday that its fourth-quarter loss narrowed sharply to $1.5 million, a reflection that it had cut costs, reduced debt and sold rights to a line of drugs.

The Rockville drug developer said the loss amounted to 7 cents per share. That compares with a loss of $24 million, or $1.29 per share, in the fourth quarter a year ago. Revenue was $461,821, up from $129,478.

Thomson Financial First Call said analysts had expected EntreMed to lose 21 cents per share.

"They've done a very good job" of cutting costs, said Marc Heilweil, president of portfolio management firm Spectrum Advisory Services Inc. The Atlanta firm recently bought about 5,000 EntreMed shares on behalf of clients to bring its total holdings of the stock to 63,800 shares.

"In my view," Heilweil said, "the company's science and technology is clearly worth more than what it's trading at now."

EntreMed cut 60 jobs, or more than half its staff, last year and narrowed its focus to save money. But it still was on the brink of running out of cash on New Year's Eve when it sold rights to certain of its thalidomide-related drugs to Celgene Corp. for about $27 million.

EntreMed recorded a $2.9 million gain on the deal in the fourth quarter, after transaction expenses were deducted. The company also has satisfied about $8.1 million in debt over the past 90 days, President Neil Campbell told investors in a conference call. The company satisfied the debt by making partial cash payments and issuing stock and warrants.

"EntreMed took decisive action in the fourth quarter to implement the company's transition to focus on our small-molecule programs," Campbell said, referring to development of drugs that are cheaper to make and less complicated to administer than complex protein drugs the company is de-emphasizing. "We believe that EntreMed now has cash and cash equivalents to carry it into 2004."

EntreMed said it had $24.1 million in cash and cash equivalents at the end of 2002.

For the year, EntreMed lost $39 million, or $1.78 a share, on revenue of $1.2 million. That compares with a loss of $43.3 million, or $2.39 a share, on revenue of $1.9 million in 2001.

Shares of EntreMed were unchanged yesterday at $1.01 on the Nasdaq stock market.

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