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Alexion Pharmaceuticals
(NASDAQ: ALXN)
25 Science Park Suite 360, New Haven 06511
203-776-1790 www.alxn.com
President and CEO: Leonard Bell, M.D.
Revenues (FYE July 31, 1999): $18.8 million
Net loss (FYE July 31, 1999): $6.4 million
Market capitalization: $694 million
Employees: 90
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Business New Haven
2/7/2000
By: Kristine Hansen
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Most students continue in their college studies with dreams of doing grand things: becoming President, owning a business, curing incurable diseases. And a few of those graduates succeed in their quests.
Young scientists, doctors and entrepreneurs set their course by creating a new company to pursue their ideals, and ideas. Alexion Pharmaceuticals is one of those companies.
Initially formed in 1992 by founder Leonard Bell and co-founders Stephen Squinto and Joseph Madri, Alexion's mission was to develop complement inhibitors, a class of anti-inflammatory compounds. Research concentrated on cell therapy for vascular diseases. The results of such investigations have led to the company's current C5 inhibitors 5G1.1, targeting rheumatoid arthritis, nephritis, systemic lupus and psoriasis, and 5G1.1-SC for cardiopulmonary bypass surgery, myocardial infarction and angioplasty. Both inhibitors are in clinical studies.
Besides these two development programs (the C5 inhibitors) for anti-inflammatory therapies for autoimmune and cardiovascular disease, the company is also developing Apogen T-Cell Therapies (MP4) for multiple sclerosis.
In another development program Alexion is concentrating on the study of non-human cells, tissues and organs that can be transplanted to humans. These UniGraft transplants are targeted to Parkinson's disease and spinal-cord injury.
To fund its endeavors, the company relies on long-term financing and alliances with partners. In November Alexion completed a follow-on offering of three million common shares at $14 per share. Proceeds for the offering are earmarked for funding Alexion research programs and also for 5G1.1 manufacturing development.
Through a January 1999 research agreement with Proctor & Gamble Pharmaceuticals, Alexion and P&G will collaborate on the development and commercialization of the 5G1.1-SC for treatment of angina, heart attack, angiosplasty and other cardiovascular indications. Terms of the agreement include Alexion's possible receipt of up to $95 million for licensing fees, research support and milestone payments. The company will also receive royalties from sale of commercialized products resulting from the collaboration.
Recently Alexion announced the signing of a contract manufacturing agreement with Genzyme Transgenics Corp. The agreement calls for Alexion's collaboration with Genzyme in the development of a manufacturing plan for an Alexion recombinant protein.
For the company's year ended July 31, 1999, contract research revenues increased to $18.8 million, compared to $5.0 million the year before, mainly on the strength of the Proctor and Gamble agreement. At $23.7 million, research and development expenses were almost double the prior year's due to costs related to Phase I and II clinical trials, manufacturing costs for 5G1.1 and 5G1.1-SC and increased research for the company's other candidates.
Alexion incurred a net loss for the year of $6.4 million (57 cents per diluted share), compared to a net loss of $7.9 million (87 cents per diluted share) for 1998.
For the quarter ended October 31, 1999, revenues were $6.3 million with a net loss of $5.2 million (46 cents per diluted share). The company's total assets are approximately $65 million after consideration of the November follow-on offering.
Currently the company's 5G1.1-SC product candidates are in a Phase IIb trial for cardiopulmonary bypass efficacy, and are also involved in two trials for Phase II myocardial infarction efficacy. The company's 5G1.1 product candidate is in Phase II trials for rheumatoid arthritis and membranous nephritis treatment.
In addition, the company's MP4 is in pre-clinical studies for multiple sclerosis. The company also has xenograft candidates and had announced along with Yale University School of Medicine positive results with the transplantation of modified pig sells into primates, which then regenerated the myelin sheath surrounding injured spinal cords.
Last month the company announced a filing with the Food & Drug Administration for an Investigational New Drug Application for Phase Ib clinical trial for use of its 5G1.1 anti-inflammatory inhibitor drug for psoriasis patients.
Alexion's stock has traded at a 52-week low of 8.37 and high of 50.12. Since December, the stock has risen substantially to an average trading price in the mid-40s range, compared to the 10-to-20 range common through most of 1999. Analysts agree on a buy or strong buy recommendation, with consensus estimates on earnings per share at -$0.29 (loss) for the quarter ended April 2000, and -$1.12 (loss) for the fiscal year ending this July.
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