UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2000
-----------------------
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 Number 0-19034
-------------
REGENERON PHARMACEUTICALS, INC.
-----------------------------------------
(Exact name of registrant as specified in its charter)
New York 13-3444607
------------------------------------- --------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
777 Old Saw Mill River Road
Tarrytown, New York 10591-6707
------------------------------------- --------------------------------------
(Address of principal executive offices) (Zip code)
(914) 347-7000
--------------
(Registrant's telephone number, including area code)
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
Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of April 30, 2000:
Class of Common Stock Number of Shares
--------------------- ----------------
Class A Stock, $0.001 par value 2,771,745
Common Stock, $0.001 par value 32,284,125
REGENERON PHARMACEUTICALS, INC.
Table of Contents
March 31, 2000
Page Numbers
PART I FINANCIAL INFORMATION
Item 1 Financial Statements
Condensed balance sheets (unaudited) at March 31, 2000 and
December 31, 1999 3
Condensed statements of operations (unaudited) for the three
months ended March 31, 2000 and 1999 4
Condensed statement of stockholders' equity (unaudited) for the
three months ended March 31, 2000 5
Condensed statements of cash flows (unaudited) for the
three months ended March 31, 2000 and 1999 6
Notes to condensed financial statements 7-11
Item 2 Management's Discussion and Analysis of Financial Condition
and Results of Operations 12-22
Item 3 Quantative and Qualitative Disclosure About Market Risk 22
PART II OTHER INFORMATION
Item 5 Other Information 23
Item 6 Exhibits and Reports on Form 8-K 23
SIGNATURE PAGE 24
Exhibit 27 Financial data schedule
2
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
REGENERON PHARMACEUTICALS, INC.
CONDENSED BALANCE SHEETS AT MARCH 31, 2000 AND DECEMBER 31, 1999 (Unaudited)
(In thousands, except share data)
March 31, December 31,
ASSETS 2000 1999
---------------- ----------------
Current assets
Cash and cash equivalents $12,294 $23,697
Marketable securities 44,120 42,463
Receivable due from The Procter & Gamble Company 7,046
Receivable due from Merck & Co., Inc. 49
Receivable due from Amgen-Regeneron Partners 1,256 473
Receivable due from Sumitomo Pharmaceuticals Company, Ltd. 209 151
Prepaid expenses and other current assets 2,866 1,708
Inventory 5,641 4,552
---------------- ----------------
Total current assets 73,481 73,044
Marketable securities 21,479 27,439
Investment in Amgen-Regeneron Partners 56
Property, plant, and equipment, at cost, net of accumulated depreciation
and amortization 36,630 36,298
Other assets 388 218
---------------- ----------------
Total assets $132,034 $136,999
================ ================
LIABILITIES and STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued expenses $6,921 $6,551
Deferred revenue, current portion 4,177 4,686
Due to Merck & Co., Inc. 334
Due to Amgen-Regeneron Partners 300
Capital lease obligations, current portion 1,284 1,380
Note payable, current portion 68 68
---------------- ----------------
Total current liabilities 12,450 13,319
Deferred revenue 11,179 11,130
Capital lease obligations 1,007 1,204
Note payable 1,513 1,527
Other liabilities 290 287
Commitments and contingencies
Stockholders' equity
Preferred stock, $.01 par value; 30,000,000 shares authorized; issued and
outstanding - none
Class A Stock, convertible, $.001 par value; 40,000,000 shares authorized;
2,773,950 shares issued and outstanding in 2000
3,605,133 shares issued and outstanding in 1999 3 4
Common Stock, $.001 par value; 60,000,000 shares authorized;
29,676,406 shares issued and outstanding in 2000
27,817,636 shares issued and outstanding in 1999 30 28
Additional paid-in capital 313,699 310,296
Accumulated deficit (207,621) (200,303)
Accumulated other comprehensive loss (516) (493)
---------------- ----------------
Total stockholders' equity 105,595 109,532
---------------- ----------------
Total liabilities and stockholders' equity $132,034 $136,999
================ ================
The accompanying notes are an integral part of the financial statements.
================================================================================
3
REGENERON PHARMACEUTICALS, INC.
CONDENSED STATEMENTS OF OPERATIONS (Unaudited)
(In thousands, except per share data)
Three months ended March 31,
2000 1999
---------------------- -------------------
Revenues
Contract research and development $9,122 $3,344
Contract manufacturing 1,376 2,115
Investment income 1,226 1,459
---------------------- -------------------
11,724 6,918
---------------------- -------------------
Expenses
Research and development 11,975 11,221
Loss in Amgen-Regeneron Partners 1,271 966
General and administrative 1,755 1,593
Depreciation and amortization 926 725
Contract manufacturing 3,051 1,254
Interest 64 89
---------------------- -------------------
19,042 15,848
---------------------- -------------------
Net loss ($7,318) ($8,930)
====================== ===================
Net loss per share, basic and diluted ($0.23) ($0.29)
====================== ===================
The accompanying notes are an integral part of the financial statements.
================================================================================
4
REGENERON PHARMACEUTICALS, INC.
CONDENSED STATEMENT OF STOCKHOLDERS' EQUITY (Unaudited)
For the three months ended March 31, 2000
(In thousands)
Class A Stock Common Stock Additional
---------------------- ------------------------- Paid-in
Shares Amount Shares Amount Capital
---------- ---------- ---------- ------------ ------------
Balance, December 31, 1999 3,605 $4 27,818 $28 $310,296
Issuance of Common Stock in connection
with exercise of stock options 495 1 2,982
Net issuance of Common Stock to Amgen
in connection with a cashless exercise
of warrants 478
Issuance of Common Stock in connection
with Company 401(k) Savings Plan
contribution 54 421
Conversion of Class A to Common Stock (831) (1) 831 1
Net loss
Change in net unrealized loss
on marketable securities
--------------------------------------------------------------------
Balance, March 31, 2000 2,774 $3 29,676 $30 $313,699
====================================================================
Accumulated
Other Total
Accumulated Comprehensive Stockholders' Comprehensive
Deficit Loss Equity Loss
--------------- ----------------- ---------------- ---------------
Balance, December 31, 1999 ($200,303) ($493) $109,532
Issuance of Common Stock in connection
with exercise of stock options 2,983
Net issuance of Common Stock to Amgen
in connection with a cashless exercise
of warrants
Issuance of Common Stock in connection
with Company 401(k) Savings Plan
contribution 421
Conversion of Class A to Common Stock
Net loss (7,318) (7,318) ($7,318)
Change in net unrealized loss
on marketable securities (23) (23) (23)
----------------------------------------------------------------------------
Balance, March 31, 2000 ($207,621) ($516) $105,595 ($7,341)
============================================================================
The accompanying notes are an integral part of the financial statements.
================================================================================
5
REGENERON PHARMACEUTICALS, INC.
CONDENSED STATEMENTS OF CASH FLOWS (Unaudited)
Increase (Decrease) in Cash and Cash Equivalents
(In thousands)
Three months ended March 31,
2000 1999
------------------ ------------------
Cash flows from operating activities
Net loss ($7,318) ($8,930)
------------------ ------------------
Adjustments to reconcile net loss to net cash
used in operating activities
Loss in Amgen-Regeneron Partners 1,271 966
Depreciation and amortization 926 725
Stock issued in consideration for services rendered 90
Changes in assets and liabilities
Increase in amounts due from The Procter & Gamble Company (7,046) (386)
Increase in amounts due from Merck & Co., Inc. (383) (903)
(Increase) decrease in amounts due from Amgen-Regeneron Partners (783) 119
Increase in amounts due from Sumitomo Pharmaceuticals Co., Ltd. (58) (15)
Increase in investment in Amgen-Regeneron Partners (1,627)
(Increase) decrease in prepaid expenses and other assets (1,328) 66
Increase in inventory (700)
Decrease in deferred revenue (460) (1)
Increase (decrease) in accounts payable, accrued expenses,
and other liabilities 919 (158)
------------------ ------------------
Total adjustments (9,269) 503
------------------ ------------------
Net cash used in operating activities (16,587) (8,427)
------------------ ------------------
Cash flows from investing activities
Purchases of marketable securities (5,984) (22,857)
Sales of marketable securities 10,264 33,685
Capital expenditures (1,771) (993)
------------------ ------------------
Net cash provided by investing activities 2,509 9,835
------------------ ------------------
Cash flows from financing activities
Net proceeds from the issuance of stock 2,983 892
Principal payments on note payable (14) (16)
Capital lease payments (294) (264)
------------------ ------------------
Net cash provided by financing activities 2,675 612
------------------ ------------------
Net (decrease) increase in cash and cash equivalents (11,403) 2,020
------------------ ------------------
Cash and cash equivalents at beginning of period 23,697 19,757
------------------ ------------------
Cash and cash equivalents at end of period $12,294 $21,777
================== ==================
The accompanying notes are an integral part of the financial statements.
================================================================================
6
REGENERON PHARMACEUTICALS, INC.
Notes to Condensed Financial Statements
(Dollars in thousands, except per share data)
1. Interim Financial Statements
The interim Condensed Financial Statements of Regeneron Pharmaceuticals,
Inc. (the "Company") have been prepared in accordance with the
instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly,
they do not include all information and disclosures necessary for a
presentation of the Company's financial position, results of operations,
and cash flows in conformity with generally accepted accounting
principles. In the opinion of management, these financial statements
reflect all adjustments, consisting only of normal recurring accruals,
necessary for a fair presentation of the Company's financial position,
results of operations, and cash flows for such periods. The results of
operations for any interim periods are not necessarily indicative of the
results for the full year. The December 31, 1999 Condensed Balance Sheet
data was derived from audited financial statements, but does not include
all disclosures required by generally accepted accounting principles.
These financial statements should be read in conjunction with the
financial statements and notes thereto contained in the Company's Annual
Report on Form 10-K for the year ended December 31, 1999.
2. Statement of Cash Flows
Supplemental disclosure of noncash investing and financing activities:
Included in accounts payable and accrued expenses at March 31, 2000 and
December 31, 1999 were $572 and $697, respectively, of accrued capital
expenditures. Included in accounts payable and accrued expenses at March
31, 1999 and December 31, 1998 were $1,421 and $469, respectively, of
accrued capital expenditures.
Included in accounts payable and accrued expenses at December 31, 1999 and
1998 were $421 and $308, respectively, of accrued Company 401(k) Savings
Plan contribution expense. During January 2000 and 1999, the Company
contributed 54,003 and 37,653 shares, respectively, of Common Stock to the
401(k) Savings Plan in satisfaction of these obligations.
3. Inventories
Inventories consist of raw materials and other direct and indirect costs
associated with the production of brain-derived neurotrophic factor
("BDNF") for Sumitomo Pharmaceuticals Company, Ltd. under a research and
development agreement and the production of an intermediate for a Merck &
Co., Inc. pediatric vaccine under a long-term manufacturing agreement.
Inventories as of March 31, 2000 and December 31, 1999 consist of the
following:
March 31, December 31,
2000 1999
---- ----
Raw materials $ 954 $ 1,042
Work-in-process 430(1) 165(2)
Finished products 4,257 3,345
----- -----
$ 5,641 $ 4,552
======= =======
(1) Net of reserves of $1,160.
(2) Net of reserves of $675.
7
REGENERON PHARMACEUTICALS, INC.
Notes to Condensed Financial Statements
(Dollars in thousands, except per share data)
4. Accounts Payable and Accrued Expenses
Accounts payable and accrued expenses as of March 31, 2000 and December
31, 1999 consist of the following:
March 31, December 31,
-----------------------
2000 1999
---- ----
Accounts payable $2,051 $2,642
Accrued payroll and related costs 2,174 1,977
Accrued clinical trial expense 1,414 1,005
Accrued expenses, other 1,048 643
Deferred compensation 234 284
--- ---
$6,921 $6,551
====== ======
5. Amgen-Regeneron Partners Research Collaboration Agreement
In August 1990, the Company entered into a collaboration with Amgen Inc.
("Amgen") to develop and commercialize BDNF and neurotrophin-3 ("NT-3").
Pursuant to that agreement, the Company and Amgen formed a partnership,
Amgen-Regeneron Partners (the "Partnership"), whereby the revenues earned
and expenses incurred by the Partnership for the research and development
of BDNF and NT-3 are shared equally. The Company accounts for its
investment in the Partnership in accordance with the equity method of
accounting.
Selected operating statement data of the Partnership for the three months
ended March 31, 2000 and 1999 is as follows:
Three Months Ended March 31,
----------------------------
2000 1999
---- ----
Total revenues $ 78 $ 116
Total expenses (2,619) (2,048)
------- -------
Net loss ($2,541) ($1,932)
======== ========
6. Comprehensive Loss
Comprehensive loss represents the change in net assets of a business
enterprise during a period from transactions and other events and
circumstances from non-owner sources. Comprehensive loss of the Company
includes net loss adjusted for the change in net unrealized gain or loss
on marketable securities. The net effect of income taxes on comprehensive
loss is immaterial. For the three months ended March 31, 2000 and 1999,
the components of comprehensive loss were:
2000 1999
---- ----
Net loss ($7,318) ($8,930)
Change in net unrealized gain/loss on marketable
securities (23) (151)
---- -----
Total comprehensive loss ($7,341) ($9,081)
======== ========
8
REGENERON PHARMACEUTICALS, INC.
Notes to Condensed Financial Statements
(Dollars in thousands, except per share data)
7. Issuance of Common Stock in a Cashless Exchange
On March 2, 2000, in accordance with the terms of their warrant agreement, as
amended, Amgen exercised 700,000 warrants with an exercise price of $16.00 per
share. As consideration for the exercise price, Amgen tendered 221,958 shares of
the Company's Common Stock which had an aggregate fair market value at the time
of exercise equal to the exercise price of the warrants. The shares of Common
Stock delivered to the Company by Amgen were retired upon receipt.
8. Per Share Data
The Company's basic net loss per share amounts have been computed by dividing
net loss by the weighted average number of Common and Class A shares
outstanding. For the three months ended March 31, 2000 and 1999, the Company
reported net losses; therefore, no common stock equivalents were included in the
computation of diluted net loss per share, since such inclusion would have been
antidilutive. The calculations of basic and diluted net loss per share are as
follows:
Three Months Ended March 31,
----------------------------------------
Shares, in
Net Loss thousands Per Share
(Numerator) (Denominator) Amount
----------- ------------- ------
2000:
Basic and Diluted ($7,318) 31,927 ($0.23)
1999:
Basic and Diluted ($8,930) 31,274 ($0.29)
Options and warrants which have been excluded from the diluted per share amounts
because their effect would have been antidilutive include the following:
Three Months Ended March 31,
-----------------------------------------------
2000 1999
--------------------- ------------------------
Weighted Weighted Weighted Weighted
Average Average Average Average
Number, Exercise Number, Exercise
in thousands Price in thousands Price
------------- -------- ------------- ---------
Options and warrants with exercise
prices below the average fair
market value of the Company's
common stock for the respective
period 7,442 $9.42 2,414 $5.78
Options and warrants with exercise
prices above the average fair
market value of the Company's
common stock for the respective
period 102 $50.14 4,575 $11.55
----- -----
Total 7,544 6,989
===== =====
9
REGENERON PHARMACEUTICALS, INC.
Notes to Condensed Financial Statements
(Dollars in thousands, except per share data)
9. Segment Reporting
For the period ended March 31, 2000, the Company's operations were
principally managed in two business segments; research and development,
and contract manufacturing:
Research and development: Includes all activities related to the discovery
of potential therapeutics for human medical conditions, and the
development and commercialization of these discoveries. Also includes
revenues and expenses related to the development of manufacturing
processes prior to commencing commercial production of a product.
Contract manufacturing: Includes all revenues and expenses related to the
commercial production of products under contract manufacturing
arrangements. The Company produces BDNF for Sumitomo Pharmaceuticals
Company, Ltd. under a research and development agreement and an
intermediate for a Merck & Co., Inc. pediatric vaccine under a long-term
manufacturing agreement.
Prior to 2000, the Company's operations were all conducted under the
research and development business segment. The table below presents
information about reported segments for the three months ended March 31,
2000:
Research & Contract Reconciling
Development Manufacturing Items Total
----------- ------------- ----- -----
Revenues $9,122 $1,376 $1,226(1) $11,724
Loss in Amgen-
Regeneron
Partners 1,271 - - 1,271
Depreciation and
amortization 926 -(2) - 926
Interest expense 22 42 - 64
Net (loss)
income (6,827) (1,717) 1,226 (7,318)
Total assets 15,050 35,837 81,147(3) 132,034
(1) Represents investment income.
(2) Depreciation and amortization related to contract manufacturing is
capitalized into inventory.
(3) Includes cash and cash equivalents, marketable securities, prepaid
expenses and other current assets, and other assets.
10. Impact of the Adoption of Recently Issued Accounting Standards
In December 1999, the staff of the Securities and Exchange Commission
("SEC") issued Staff Accounting Bulletin 101, "Revenue Recognition", ("SAB
101"). SAB 101 requires companies who receive license and milestone
payments, whether refundable or non-refundable, to recognize them ratably
over the period that the related services are rendered.
In the period of adoption, companies will be required to report the
cumulative effect of this change in accounting principle as a separate
component in net income (or loss). Regeneron is required to adopt SAB 101
during the quarter ending June 30, 2000, and is currently evaluating how
to apply SAB 101 and the impact that it will have on the Company's
financial statements. Although the effects of SAB 101 cannot be fully
determined at this time, the Company estimates that, if SAB 101 had been
adopted as of December 31, 1999, the cumulative charge to earnings, and
corresponding increase in deferred revenue which will be recognized in
future periods, would have been less than $5 million.
10
REGENERON PHARMACEUTICALS, INC.
Notes to Condensed Financial Statements
(Dollars in thousands, except per share data)
11. Subsequent Event
On April 4, 2000, the Company completed a public offering of 2.6 million
shares of Common Stock at a price of $29.75 per share for proceeds to the
Company, before expenses, of $73.5 million.
11
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
General
Overview. The discussion below contains forward-looking statements that
involve risks and uncertainties relating to the future financial performance of
Regeneron Pharmaceuticals, Inc. and actual events or results may differ
materially. These statements concern, among other things, the possible
therapeutic applications of Regeneron's product candidates and research
programs, the timing and nature of the clinical and research programs now
underway or planned, a variety of items described herein and in the footnotes to
Regeneron's financial statements (including the useful life of assets, the
anticipated length of agreements, and other matters), and the future uses of
capital and financial needs of Regeneron. These statements are made by Regeneron
based on management's current beliefs and judgment. In evaluating such
statements, stockholders and potential investors should specifically consider
the various factors identified under the caption "Factors That May Affect Future
Operating Results" which could cause actual results to differ materially from
those indicated by such forward-looking statements.
Regeneron Pharmaceuticals, Inc. (Regeneron or the Company) is a
biopharmaceutical company that discovers, develops, and intends to commercialize
therapeutic drugs for the treatment of serious medical conditions. Expanding
from our initial focus on degenerative neurologic diseases, we have more
recently broadened our product pipeline to include drug candidates for the
treatment of obesity, rheumatoid arthritis, cancer, allergies, asthma, ischemia,
and other diseases and disorders.
Our ability to discover and develop product candidates for such a wide
variety of serious medical conditions results from the leveraging of several
powerful technology platforms, many of which were developed or enhanced by us.
In contrast to basic genomics approaches, which attempt to identify every gene
in a cell or genome, we use Targeted Genomics(TM) and Functionomics(TM)
(functional cloning) technology platforms that are designed to discover specific
genes of therapeutic interest for a particular disease or cell type. Using these
approaches, we have discovered many new families of growth factors and
receptors, many of which are already protected by issued patents, and which have
led to several product candidates. If the natural protein itself is not a
product candidate, we utilize our Designer Protein Therapeutics(TM) platform to
genetically engineer product candidates with the desired properties. This
technology platform has already produced more than 10 patented proteins, several
of which are in preclinical development.
The sophisticated application of all of these technology platforms,
coupled with our biologic expertise in preclinical models of disease, has
allowed us to discover drug candidates that address a wide variety of important
medical needs. We have three products in ongoing clinical trials and several
product candidates are expected to enter clinical trials over the next one to
two years, including:
o AXOKINE(R) second generation ciliary neurotrophic factor: Acts on the
brain region regulating food intake and energy expenditure. AXOKINE is
being developed for the treatment of obesity and complications of obesity
such as Type II diabetes, and is in clinical trials. We are also
developing a modified form of
12
AXOKINE (pegylated) that in preclinical studies is substantially longer
acting than unmodified AXOKINE. This may allow less frequent and lower
dosing in patients.
o Cytokine Traps: Protein-based antagonists for cytokines such as
interleukin-1 (called IL-1), interleukin-4 (IL-4), interleukin-6 (IL-6)
and a single antagonist that blocks both IL-4 and interleukin-13 (IL-13).
These cytokines are thought to play a major role in diseases such as
rheumatoid arthritis and other inflammatory diseases, asthma, allergic
disorders, and cancer. Cytokine Traps are potential treatments for these
diseases, and at least one Cytokine Trap is expected to enter clinical
trials by 2001.
o VEGF Trap: An antagonist to Vascular Endothelial Growth Factor (called
VEGF), which is required for the growth of blood vessels that are needed
for tumors to grow. In a preclinical model of cancer, the VEGF Trap
blocked the growth of tumors by an anti-angiogenesis mechanism. VEGF Trap
is a potential treatment for cancer and is expected to enter clinical
trials in 2001.
o Angiopoietins: A new family of growth factors, discovered by us, that are
specific for blood vessels and early hemopoietic stem cells. The
Angiopoietins, and engineered forms of these growth factors that can act
as activators and blockers, are in preclinical testing for promoting blood
vessel growth (to provide blood flow in diseased hearts and other tissues
that have lost their original blood supplies), for blocking blood vessel
growth (for the treatment of cancers), for fixing leaky blood vessels
(that cause swelling and edema in many different diseases such as stroke,
diabetic retinopathy, and inflammatory diseases), and for promoting the
growth and mobilization of certain hemopoietic cells such as stem cells
and platelets.
o Brain-derived neurotrophic factor, or BDNF: Promotes survival of the
spinal cord neurons that die in amyotropic lateral sclerosis (or ALS,
commonly known as Lou Gehrig's Disease) in preclinical models. BDNF is in
clinical trials for ALS using two routes of administration; one of these
trials is based on the results of a prior Phase III clinical trial.
o Neurotrophin-3, or NT-3: Acts on the neurons of the intestinal tract, and
is in clinical trial for the treatment of constipating disorders
associated with spinal cord injury and other neurologic diseases.
Discussion of First Quarter 2000 Activities. In the first quarter of 2000,
Regeneron initiated a Phase II dose-ranging trial to study the safety and
efficacy of AXOKINE in obese patients. AXOKINE is being developed for the
treatment of obesity and complications of obesity such as Type II diabetes. The
double-blind, placebo-controlled multicenter clinical trial will be conducted in
approximately 175 severely obese patients who will be treated for 90 days at
doses up to 2 micrograms per kilogram per day administered subcutaneously. The
Phase II study follows a two-week Phase I study, completed in late 1999, in
which mildly to moderately obese subjects treated with AXOKINE lost weight and
had reduced food intake compared to those on placebo. In the Phase I study, some
patients who received higher doses of AXOKINE and who had previously contracted
herpes simplex virus (HSV) experienced "cold sores" related to reactivation of
their HSV infection. Increased cold sores caused by HSV were also
13
reported in previous clinical studies of ciliary neurotrophic factor (also
called CNTF), AXOKINE's parent molecule. In addition, some patients in the study
experienced a reversible and generally asymptomatic increase in pulse rate in a
dose-related fashion. The Phase II study of AXOKINE will be conducted at doses
that were associated with weight loss, generally well tolerated, and not
associated with herpes cold sores in the Phase I study; there will be no
restrictions as to a subject's prior history of herpes cold sores. The Phase II
study is designed to confirm the weight loss observed in the Phase I study in a
trial of longer duration and to determine the lowest effective well-tolerated
dose. The Company also plans to collect additional data in the study about the
relationship of AXOKINE and reactivation of HSV, about the effect of AXOKINE on
pulse rate, and about the possible development of neutralizing antibodies when
AXOKINE is administered for a longer time.
Regeneron signed an agreement with Emisphere Technologies, Inc. during the
first quarter of 2000 to establish a research and development collaboration to
utilize Emisphere's oral drug delivery technology for AXOKINE. In preliminary
preclinical pharmacokinetic studies, the Emisphere technology was able to
achieve measurable blood levels of AXOKINE. Under the terms of the agreement,
Regeneron will support research at Emisphere and under certain conditions will
make additional payments, including license and milestone payments. Regeneron
will receive exclusive worldwide commercialization rights to oral products that
result from the collaboration and pay Emisphere a royalty on sales of any such
products.
No assurance can be made regarding the timing or final result of the Phase
II study or the timing or result of any further clinical trial of AXOKINE.
Previous clinical studies of AXOKINE and CNTF, in addition to weight loss,
resulted in the creation of neutralizing antibodies and adverse events (side
effects) in patients, including cough, nausea, malaise, and increased herpes
simplex cold sores. While certain aspects of the development of AXOKINE have
focused on attempting to avoid or minimize antibody production or adverse
events, no assurance may be given that these problems will be avoided or
minimized or that they will not lead to the failure, delay, or additional
difficulty in conducting AXOKINE clinical trials. We discuss the risks
associated with antibody development and adverse side effects in the section of
this report titled "Factors That May Affect Future Operating Results."
During the first quarter of 2000, Regeneron and The Procter & Gamble
Company continued to collaborate in research and development in the fields of
angiogenesis, cancer, bone growth and related areas, muscle injury and atrophy,
and small molecule (orally active) drugs. The majority of Regeneron's scientific
resources are devoted to its collaborative activities with Procter & Gamble.
Regeneron continues to develop, independent of any corporate
collaboration, its proprietary Cytokine Traps for the potential treatment of
rheumatoid arthritis and other inflammatory diseases, asthma, and allergic
disorders.
In the first quarter of 2000, Regeneron entered into a collaboration under
a binding memorandum of understanding with Medarex, Inc. to discover, develop
and commercialize human antibodies as therapeutics. Regeneron will contribute
our expertise in discovering and characterizing proteins as drug discovery
targets, and Medarex will contribute its HuMAb-Mouse(TM) technology to create
fully human antibody products for those targets. The companies have selected
more than twenty initial targets, including growth factors, cytokines, and
receptors, and plan to add additional targets in the future. Regeneron and
Medarex intend to prioritize targets based upon a variety of
14
criteria, including target validation, reagent availability, market opportunity,
competitive factors, intellectual property position, and the expected
feasibility of obtaining antibodies that have the desired properties. The
HuMAb-Mouse is a transgenic mouse whose genes for creating mouse antibodies have
been inactivated and replaced by human antibody genes. This makes it possible to
rapidly create and develop fully human antibodies as drug candidates. Regeneron
and Medarex agreed to share preclinical and clinical responsibilities and intend
to jointly market any drugs that result from this collaboration.
During the first quarter of 2000, Amgen-Regeneron Partners, the
partnership equally owned by Regeneron and Amgen Inc., continued to develop BDNF
and NT-3. BDNF is currently being developed by Amgen-Regeneron Partners for
potential use in treating ALS through two routes of administration: intrathecal
(infusion into the spinal fluid through an implanted pump, supplied by
Medtronic, Inc.) and subcutaneous (injection under the skin). In the fourth
quarter of 1998, Amgen, on behalf of the partnership began an intrathecal study
in more than 200 patients with ALS. Subcutaneous studies conducted by Regeneron
on behalf of the partnership began in the first quarter of 1998. The
subcutaneous studies are based on an analysis of the Amgen-Regeneron Partners
Phase III trial of BDNF for ALS that was completed in 1996. That trial failed to
achieve its predetermined end points, but subsequent analyses indicated that a
retrospectively-defined subset of ALS patients in the trial may have received a
survival benefit from BDNF treatment. A multi-center study of more than 300 ALS
patients who will receive BDNF subcutaneously began in August 1999 and is fully
enrolled.
Regeneron and Sumitomo Pharmaceuticals Co., Ltd. are collaborating in the
development of BDNF in Japan, initially for the treatment of ALS. In March 1998,
Sumitomo Pharmaceuticals commenced a Phase I safety assessment of BDNF delivered
subcutaneously to normal volunteers and signed a license agreement for the
development of BDNF in Japan. Pursuant to the license agreement, Sumitomo
Pharmaceuticals made research progress payments to Regeneron of $5.0 million
(reduced by $0.5 million of Japanese withholding tax) in August 1998 and $3.0
million (reduced by $0.3 million of Japanese withholding tax) in April 2000, and
will be required to make additional payments upon the achievement of specified
milestones. Sumitomo Pharmaceuticals will also pay a royalty on sales of BDNF in
Japan.
Amgen-Regeneron Partners' clinical development of NT-3 is currently
focused on constipating conditions. In 1998, Regeneron, on behalf of
Amgen-Regeneron Partners, completed a small clinical study that included healthy
volunteers and patients suffering from severe idiopathic constipation, and began
additional small studies that are continuing in 2000 in patients who suffer from
constipation associated with conditions such as spinal cord injury and the use
of narcotic analgesics. In February 2000, Regeneron initiated a double-blind,
placebo-controlled Phase II study in more than 100 patients with functional
constipation.
No assurance can be given that extended administration of BDNF or NT-3
will be safe or effective. The treatment of ALS has been shown, in a number of
clinical settings using a variety of treatment modalities (including
Amgen-Regeneron Partners' earlier clinical studies), to present significant
difficulties. The design of an ALS clinical study presents special difficulties
and risks, as do the facts that ALS is a progressive disease that afflicts
individual patients differently and other ALS treatments are approved or have
been or are currently being tested, creating the possibility that patients in
any BDNF study may also receive other therapeutics during all or part of the
BDNF trial. The treatment of constipating conditions may present additional
clinical trial risks in light of the complex and not wholly understood
mechanisms of action that lead to the conditions,
15
the concurrent use of other drugs to treat the underlying illnesses as well as
the gastrointestinal condition, the potential difficulty of designing and
achieving significant clinical end points, and other factors. No assurance can
be given that these or any other studies of BDNF or NT-3 will be successful or
that BDNF or NT-3 will be commercialized.
A minority of all research and development programs ultimately result in
commercially successful drugs; it is not possible to predict whether any program
will succeed until it actually produces a drug that is commercially marketed for
a significant period of time. In addition, in each of the areas of Regeneron's
independent and collaborative activities, other companies and entities are
actively pursuing competitive paths toward similar objectives. The results of
the Company's and its collaborators' past activities in connection with the
research and development of AXOKINE, Cytokine Traps, Angiopoietins, cancer,
abnormal bone growth, muscle atrophy, small molecules, BDNF, NT-3, and other
programs or areas of research or development do not necessarily predict the
results or success of current or future activities including, but not limited
to, any additional preclinical or clinical studies. Regeneron cannot predict
whether, when, or under what conditions any of its research or product
candidates, including without limitation AXOKINE, BDNF, or NT-3, will be shown
to be safe or effective to treat any human condition or be approved for
marketing by any regulatory agency. The delay or failure of current or future
studies to demonstrate the safety or efficacy of its product candidates to treat
human conditions or to be approved for marketing could have a material adverse
impact on Regeneron.
Regeneron has not received any revenues from the commercial sale of
products and may never receive such revenues. Before such revenues can be
realized, Regeneron (or its collaborators) must overcome a number of hurdles
which include successfully completing its research and development efforts and
obtaining regulatory approval from the FDA or regulatory authorities in other
countries. The Company is attempting to develop drugs for human therapeutic use
and no assurance can be made that any of the Company's research and development
activities will be successful or that any of the Company's current or future
potential product candidates will be commercialized. In addition, the
biotechnology and pharmaceutical industries are rapidly evolving and highly
competitive, and new developments may render Regeneron's products and
technologies noncompetitive or obsolete.
From inception on January 8, 1988 through March 31, 2000, Regeneron had a
cumulative loss of $207.6 million. In the absence of revenues from commercial
product sales or other sources (the amount, timing, nature, or source of which
cannot be predicted), Regeneron's losses will continue as it conducts its
research and development activities. The Company's activities may expand over
time and may require additional resources, and the Company's operating losses
may be substantial over at least the next several years. Regeneron's losses may
fluctuate from quarter to quarter and will depend, among other factors, on the
timing of certain expenses and on the progress of its research and development
efforts.
Results of Operations
Three months ended March 31, 2000 and 1999. The Company's total revenue
increased to $11.7 million for the first quarter of 2000 from $6.9 million for
the same period in 1999. Contract research and development revenue increased to
$9.1 million for the first quarter of 2000 from $3.3 million for the same period
in 1999, as revenue from
16
Procter & Gamble increased to $7.1 million for the first quarter of 2000 from
$2.9 million for the same period in 1999. Effective in the third quarter of
1999, research support under the Company's collaboration agreement with Procter
& Gamble increased from $1.1 million per quarter to $7.0 million per quarter.
However, Procter & Gamble payments related to AXOKINE research stopped in the
third quarter of 1999 after Procter & Gamble returned the product rights to
AXOKINE to the Company. Revenue from Amgen-Regeneron Partners increased to $1.9
million in the first quarter of 2000 from $0.4 million for the same period in
1999 due to increased clinical trial activity on BDNF and NT-3. Contract
manufacturing revenue, related primarily to a long-term manufacturing agreement
with Merck & Co., Inc. to manufacture a vaccine intermediate, decreased to $1.4
million in the first quarter of 2000 from $2.1 million for the same period in
1999. In the first quarter of 1999, Merck revenue was primarily reimbursement
for expenses related to preparing for commercial production, which began in the
fourth quarter of 1999. In the first quarter of 2000, Merck revenue was
primarily payments related to commercial production. The Company's investment
income decreased to $1.2 million in the first quarter of 2000 from $1.5 million
for the same period in 1999 due primarily to lower levels of interest-bearing
investments as the Company funds its operations.
The Company's total operating expenses increased to $19.0 million in the
first quarter of 2000 from $15.8 million for the same period in 1999. Research
and development expenses increased to $12.0 million in the first quarter of 2000
from $11.2 million for the same period in 1999, primarily as a result of higher
staffing and increased activity in the Company's preclinical and clinical
research programs. The loss in Amgen-Regeneron Partners increased to $1.3
million in the first quarter of 2000 from $1.0 million for the same period in
1999 due to the partnership's increased clinical trial activity on BDNF and
NT-3. Research and development expenses (including loss in Amgen-Regeneron
Partners) were approximately 70% of total operating expenses in the first
quarter of 2000, compared to 77% for the same period in 1999.
General and administrative expenses increased to $1.8 million in the first
quarter of 2000 from $1.6 million for the same period of 1999, due primarily to
an increase in patent expenses related to foreign filings and higher
administrative staffing. Depreciation and amortization expense increased to $0.9
million in the first quarter of 2000 from $0.7 million in the first quarter of
1999, resulting from improvements made to the Company's leased facilities in
Tarrytown, New York, as well as purchases of new research equipment. Contract
manufacturing expenses increased to $3.1 million in the first quarter of 2000
from $1.3 million for the same period in 1999 due to costs associated with
initiating commercial production at the Company's Rensselaer, New York facility
of both vaccine intermediate for Merck and BDNF for clinical use by Sumitomo
Pharmaceuticals. Interest expense was $0.1 million for the first quarter of both
2000 and 1999.
The Company's net loss for the first quarter of 2000 was $7.3 million, or
$0.23 per share (basic and diluted), compared to a net loss of $8.9 million, or
$0.29 per share (basic and diluted), for the same period in 1999.
Liquidity and Capital Resources
Since its inception in 1988, the Company has financed its operations
primarily through private placements and public offerings of its equity
securities, revenue earned
17
under the agreements between the Company and Amgen, Sumitomo Chemical Company,
Ltd., Sumitomo Pharmaceuticals, Merck, and Procter & Gamble, and investment
income.
In May 1997, Regeneron and Procter & Gamble entered into the P&G
Agreement. Procter & Gamble agreed over the first five years of the P&G
Agreement to purchase up to $60.0 million in Regeneron equity (of which $42.9
million was purchased in June 1997) and provide up to $94.7 million in support
of Regeneron's research efforts related to the collaboration (of which $24.0
million was received through March 31, 2000). During the second five years of
the P&G Agreement, the companies will share all research costs equally. Clinical
testing and commercialization expenses for jointly developed products will
generally be shared equally throughout the ten years of the collaboration. The
companies expect jointly to develop and market worldwide any products resulting
from the collaboration and share equally in profits. Either company may
terminate the P&G Agreement at the end of five years with at least one year
prior notice or earlier if a defined event of default occurs. Beginning in the
third quarter of 1999, research support from Procter & Gamble increased from
$1.1 million per quarter to at least $6.3 million per quarter through June 2002.
In connection with Regeneron's agreement to collaborate with Sumitomo
Pharmaceuticals in the research and development of BDNF in Japan, Sumitomo
Pharmaceuticals paid the Company $25.0 million through December 1997. The
Company also received research progress payments from Sumitomo Pharmaceuticals
of $5.0 million (reduced by $0.5 million of Japanese withholding tax) in August
1998 and $3.0 million (reduced by $0.3 million of Japanese withholding tax) in
April 2000. In addition, Sumitomo Pharmaceuticals has paid the Company $27.6
million through March 31, 2000 in connection with supplying BDNF for preclinical
and clinical use. Regeneron did not supply any BDNF to Sumitomo Pharmaceuticals
in 1999. During the fourth quarter of 1999, Regeneron commenced production of
BDNF and began capitalizing manufacturing costs into inventory. The Company
expects to resume supplying BDNF to Sumitomo Pharmaceuticals for clinical use in
2000.
The Company's activities relating to BDNF and NT-3, as agreed upon by
Amgen and Regeneron, are being reimbursed by Amgen-Regeneron Partners, and the
Company recognizes such reimbursement as revenue. The funding of Amgen-Regeneron
Partners is through capital contributions from Amgen and Regeneron, who must
make equal payments in order to maintain equal ownership and equal sharing of
any profits or losses from the partnership. The Company has made capital
contributions totaling $52.7 million to Amgen-Regeneron Partners from the
partnership's inception in June 1993 through March 31, 2000. These contributions
could increase or decrease, depending upon (among other things) the nature and
cost of BDNF and NT-3 studies that Amgen-Regeneron Partners may conduct and the
outcomes of those studies.
From its inception in January 1988 through March 31, 2000, the Company
invested approximately $68.3 million in property, plant, and equipment. This
includes $17.3 million to acquire and renovate the Rensselaer facility and an
additional $14.1 million to complete construction at the facility pursuant to
the Merck manufacturing agreement. In connection with the purchase and initial
renovation of the Rensselaer facility, the Company obtained financing of $2.0
million from the New York State Urban Development Corporation, of which $1.6
million is outstanding. Under the terms of this UDC financing, the Company is
not permitted to declare or pay dividends on its equity securities.
18
The Company expects that expenses related to the filing, prosecution,
defense, and enforcement of patent and other intellectual property claims will
continue to be substantial as a result of patent filings and prosecutions in the
United States and foreign countries. The Company is currently involved in
interference proceedings in the Patent and Trademark Office between Regeneron's
patent applications and patents relating to CNTF issued to Synergen, Inc. Amgen
acquired all outstanding shares of Synergen in 1994. In March 1998, the Company
and Amgen entered into a covenant not to sue each other which, among other
things, provided a simple mechanism for resolving their patent interference and
related patent proceedings relating to CNTF and AXOKINE without protracted
litigation. The Company also granted Amgen a license to use CNTF and second
generation CNTFs other than AXOKINE to treat retinal degenerative conditions.
Regeneron will not pay royalties or make other payments to the other party in
consideration of this agreement.
As of March 31, 2000, the Company had no established banking arrangements
through which it could obtain short-term financing or a line of credit.
Additional funds may be raised through, among other things, the issuance of
additional securities, other financing arrangements, and future collaboration
agreements. No assurance can be given that additional financing will be
available or, if available, that it will be available on acceptable terms. In
addition, the Company estimates that through mid-2002 it could receive
additional payments from Procter & Gamble in the form of research funding and
equity purchases of as much as $90 million or more.
At March 31, 2000, the Company had $77.9 million in cash, cash
equivalents, and marketable securities. On April 4, 2000, Regeneron completed a
public offering of 2.6 million shares of Common Stock at a price of $29.75 per
share for proceeds to the Company, before expenses, of $73.5 million. The
Company expects to incur substantial funding requirements for, among other
things, research and development activities (including preclinical and clinical
testing), validation of manufacturing facilities, and the acquisition of
equipment. The Company expects to incur ongoing funding requirements for capital
contributions to Amgen-Regeneron Partners to support the continued development
and clinical trials of BDNF and NT-3. Through 2000, the Company expects further
increases in the level of quarterly research and development expenses as the
Company continues to add staff and increases its clinical activity. The amount
needed to fund operations will also depend on other factors, including the
status of competitive products, the success of the Company's research and
development programs, the status of patents and other intellectual property
rights developments, and the continuation, extent, and success of any
collaborative research programs (including those with Amgen and Procter &
Gamble). The Company believes that under its current strategy its existing
capital resources will enable it to meet operating needs for several years. No
assurance can be given that there will be no change in projected revenues or
expenses that would lead to the Company's capital being consumed significantly
before such time.
Impact of the Adoption of Recently Issued Accounting Standards
In December 1999, the staff of the Securities and Exchange Commission
("SEC") issued Staff Accounting Bulletin 101, "Revenue Recognition",
("SAB 101"). SAB 101 requires companies who receive license and milestone
payments, whether refundable or non-refundable, to recognize them ratably over
the period that the related services are rendered.
19
In the period of adoption, companies will be required to report the
cumulative effect of this change in accounting principle as a separate component
in net income (or loss). Regeneron is required to adopt SAB 101 during the
quarter ending June 30, 2000, and is currently evaluating how to apply SAB 101
and the impact that it will have on the Company's financial statements. Although
the effects of SAB 101 cannot be fully determined at this time, the Company
estimates that, if SAB 101 had been adopted as of December 31, 1999, the
cumulative charge to earnings, and corresponding increase in deferred revenue
which will be recognized in future periods, would have been less than $5
million.
Factors That May Affect Future Operating Results
Regeneron cautions stockholders and potential investors that the following
important factors, among others, in some cases have affected, and in the future
could affect, Regeneron's actual results and could cause Regeneron's actual
results to differ materially from those expressed in any forward-looking
statements made by, or on behalf of, Regeneron. The statements under this
caption are intended to serve as cautionary statements within the meaning of the
Private Securities Litigation Reform Act of 1995. The following information is
not intended to limit in any way the characterization of other statements or
information under other captions as cautionary statements for such purpose:
o Delay, difficulty, or failure of the Company's research and development
programs to produce product candidates that are scientifically or
commercially appropriate for further development by the Company or others.
o Cancellation or termination of material collaborative or licensing
agreements (including in particular, but not limited to, those with
Procter & Gamble and Amgen) and the resulting loss of research or other
funding could have a material adverse effect on the Company and its
operations. A change of control of one or more of the Company's material
collaborators or licensees could also have a material adverse effect on
the Company.
o Delay, difficulty, or failure of a clinical trial of any of the Company's
product candidates. A clinical trial can fail or be delayed as a result of
many causes, including, among others, failure of the product candidate to
demonstrate safety or efficacy, the development of serious or
life-threatening adverse events (side effects) caused by or connected with
exposure to the product candidate, and the failure of clinical
investigators, trial monitors and other consultants, or trial subjects to
comply with the trial plan or protocol.
o In addition to the safety, efficacy, manufacturing, and regulatory hurdles
faced by Regeneron's drug candidates, the administration of recombinant
proteins frequently causes an immune response, resulting in the creation
of antibodies against the therapeutic protein. The antibodies can have no
effect or can totally neutralize the effectiveness of the protein, or
require that higher doses be used to obtain a therapeutic effect. In some
cases, the antibody can cross-react with the patient's own proteins,
resulting in an "auto-immune type" disease. Whether antibodies will be
created can often not be predicted from preclinical experiments and their
appearance is often delayed, so that there can be no assurance that
neutralizing antibodies will not be created at a later date -- in some
cases even after pivotal clinical trials have been successfully completed.
Patients who have
20
been treated with AXOKINE, BDNF, and NT-3 have developed antibodies,
though we have no information that indicates that these antibodies are
neutralizing antibodies.
o Delay, difficulty, or failure in obtaining regulatory approval (including
approval of its facilities for production) for the Company's products,
including delays or difficulties in development because of insufficient
proof of safety or efficacy.
o Increased and irregular costs of development, manufacture, regulatory
approval, sales, and marketing associated with the introduction of
products in the late stage of development.
o Competitive or market factors that may cause use of the Company's products
to be limited or otherwise fail to achieve broad acceptance.
o The ability to obtain, maintain, and prosecute intellectual property
rights and the cost of acquiring in-process technology and other
intellectual property rights, either by license, collaboration, or
purchase of another entity.
o Difficulties or high costs of obtaining adequate financing to meet the
Company's obligations under its collaboration and licensing agreements or
to fund 50 percent of the cost of developing product candidates in order
to retain 50 percent of the commercialization rights.
o Amount and rate of growth of Regeneron's general and administrative
expenses, and the impact of unusual charges resulting from Regeneron's
ongoing evaluation of its business strategies and organizational
structure.
o Failure of corporate partners to develop or commercialize successfully the
Company's products or to retain and expand the markets served by the
commercial collaborations; conflicts of interest, priorities, and
commercial strategies which may arise between Regeneron and its corporate
partners.
o Delays or difficulties in developing and acquiring production technology
and technical and managerial personnel to manufacture novel biotechnology
product in commercial quantities at reasonable costs and in compliance
with applicable quality assurance and environmental regulations and
governmental permitting requirements.
o Difficulties in obtaining key raw materials and supplies for the
manufacture of the Company's product candidates.
o The costs and other effects of legal and administrative cases and
proceedings (whether civil, such as product- or employment-related, or
environmental, or criminal); settlements and investigations; developments
or assertions by or against Regeneron relating to intellectual property
rights and licenses; the issuance and use of patents and proprietary
technology by Regeneron and its competitors, including the possible
negative effect on the Company's ability to develop, manufacture, and sell
its products in circumstances where it is unable to obtain licenses to
patents which may be required for such products.
21
o Underutilization of the Company's existing or new manufacturing facilities
or of any facility expansions, resulting in inefficiencies and higher
costs; start-up costs, inefficiencies, delays, and increased depreciation
costs in connection with the start of production in new plants and
expansions.
o Health care reform, including reductions or changes in reimbursement
available for prescription medications or other reforms.
o The ability to attract and retain key personnel.
As Regeneron's scientific efforts lead to potentially promising new
directions, both outside of recombinant protein therapies and into conditions or
diseases outside of Regeneron's current areas of experience and expertise, the
Company will require additional internal expertise or external collaborations in
areas in which it currently does not have substantial resources and personnel.
Item 3. Quantitative and Qualitative Disclosure About Market Risk.
The Company's earnings and cash flows are subject to fluctuations due to
changes in interest rates primarily from its investment of available cash
balances in investment grade corporate and U.S. government securities. The
Company does not believe it is materially exposed to changes in interest rates.
Under its current policies the Company does not use interest rate derivative
instruments to manage exposure to interest rate changes.
22
PART II. OTHER INFORMATION
ITEM 5. OTHER INFORMATION
William G. Roberts, M.D., who has been Vice President, Regulation
Development since May 1999 is the son-in-law of P. Roy Vagelos, M.D., who has
been Chairman of the Board of Directors of the Company since January 1995.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
27 Financial Data Schedule
(b) Reports
On March 29, 2000, the Company filed a report on Form 8-K regarding the
fact that the Company issued a press release entitled "Regeneron Initiates
Phase II Obesity Clinical Trial", a copy of which was included as an
exhibit to that filing.
23
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.
Regeneron Pharmaceuticals, Inc.
Date: May 12, 2000 By: /s/ Murray A. Goldberg
------------------------------------
Murray A. Goldberg
Vice President, Finance & Administration,
Chief Financial Officer, Treasurer and
Assistant Secretary
24
5
1,000
3-MOS
DEC-31-2000
JAN-01-2000
MAR-31-2000
12,294
65,599
8,560
0
5,641
73,481
68,309
31,679
132,034
12,450
0
0
0
30
105,565
132,034
0
11,724
0
0
19,042
0
0
(7,318)
0
(7,318)
0
0
0
(7,318)
(0.23)
(0.23)
