MISSISSAUGA, ON, Jan. 16 /PRNewswire-FirstCall/ -- Vasogen Inc.
(NASDAQ:VSGN; TSX:VAS), today reported the results of operations
for the fiscal year ended November 30, 2007. All dollar amounts
referenced herein are in Canadian dollars unless otherwise noted.
At November 30, 2007, our cash and cash equivalents totaled $23.5
million, compared with $30.4 million at November 30, 2006. The
change in our cash position resulted mainly from cash used for
operations partially offset by cash provided by financing
activities. Our net cash used for operations for the three months
ended November 30, 2007, was $4.5 million. The net loss for the
fourth quarter of 2007 was $6.1 million, or $0.27 per common share.
We incurred a net loss for the year ended November 30, 2007 of
$28.8 million, or $1.46 per common share, compared with a net loss
of $66.4 million, or $7.05 per common share for the same period in
2006. The key drivers of our reduced losses in 2007 are lower
research and development expenses as a result of the completion of
our phase III clinical programs in 2006, the corporate costs
associated with supporting these programs, and a reduction in
expenses associated with our senior convertible notes. These
reductions in expenses were partially offset by restructuring
costs. The difference between cash used in operations and our
accounting loss is driven by non-cash items, such as expenses
related to our senior convertible notes and stock options, as well
as unrealized foreign exchange gains and losses. Highlights - The
results from the phase III ACCLAIM trial of our Celacade(TM) System
in patients with chronic heart failure were accepted for
publication in The Lancet, a world-leading medical journal. As
previously reported by Vasogen, while the trial did not meet its
primary endpoint, a key finding from the ACCLAIM trial was a 39%
reduction in the risk of death or cardiovascular hospitalizations
for a large pre-specified subgroup of patients with NYHA Class II
heart failure who received Celacade therapy, compared to patients
receiving placebo. - We entered into a collaboration with Grupo
Ferrer Internacional, S.A., a leading European pharmaceutical and
medical devices company, to commercialize Celacade for the
treatment of chronic heart failure in specified countries of the
European Union and in certain Latin American countries. In December
2007, Ferrer received initial orders for Celacade in Germany. - The
Food and Drug Administration strongly recommended that we conduct a
confirmatory study (ACCLAIM-II) in NYHA Class II heart failure
patients to support a Pre-market Approval filing for Celacade in
the United States. The FDA also recommended that we utilize a
Bayesian statistical approach for designing the confirmatory trial
as it would allow for the borrowing of statistical power from the
ACCLAIM study. This approach has the potential to substantially
reduce the number of patients required for a confirmatory study, as
well as the cost and duration. - James B. Young, MD, Chairman,
Division of Medicine at the Cleveland Clinic Foundation and Medical
Director, Kaufman Center for Heart Failure, was appointed the
Global Principal Investigator and Chairman of the Steering
Committee for ACCLAIM-II. - Chris Waddick, MBA, CMA, was appointed
President, CEO, and a Member of the Board of Directors of our
Company. Mr. Waddick has held a series of progressive senior
management positions at Vasogen over the past twelve years, most
recently as Chief Operating Officer and Chief Financial Officer. As
previously announced, a conference call will be conducted on
January 16, 2008, at 4:30 p.m. Eastern Time. The conference call
may be accessed by calling 416-641-6142 or 1-866-542-4241 ten
minutes prior to the call. An audio web cast of the event will also
be available at http://www.vasogen.com/. A re-broadcast of the
conference call may be accessed by calling 416-695-5800 or
1-800-408-3053, pass code 3248350 followed by the number sign, and
will also be available at http://www.vasogen.com/. About Vasogen:
Vasogen is a biotechnology company engaged in the research and
commercial development of therapies designed to target the
destructive inflammatory process associated with the development
and progression of cardiovascular and neurodegenerative disorders.
The Company's lead product, the Celacade(TM) System, is designed to
activate the immune response to apoptosis - an important
physiological process that regulates inflammation. Celacade has
received European regulatory approval under the CE Mark for chronic
heart failure and is being marketed in the EU by Grupo Ferrer
Internacional, S.A. Celacade is also in late-stage clinical
development for the treatment of chronic heart failure in the
United States. Vasogen is also developing a new class of drugs for
the treatment of certain neuro-inflammatory disorders. VP025 is the
lead candidate from this new class of drugs. Certain statements
contained in this press release, the upcoming conference call and
webcast, or elsewhere in our public documents constitute
"forward-looking statements" within the meaning of the United
States Private Securities Litigation Reform Act of 1995 and/or
"forward-looking information" under the Securities Act (Ontario).
These statements may include, without limitation, plans to advance
the development of Celacade(TM) or VP025, plans to fund our current
activities, statements concerning our partnering activities, health
regulatory submissions, strategy, future operations, future
financial position, future revenues and projected costs. In some
cases, you can identify forward-looking statements by terminology
such as "may", "will", "should", "expects", "plans", "anticipates",
"believes", "estimated", "predicts", "potential", "continue",
"intends", "could", or the negative of such terms or other
comparable terminology. We made a number of assumptions in the
preparation of these forward-looking statements, including
assumptions about the nature, size, and accessibility of the market
for Celacade in the treatment of chronic heart failure,
particularly in Europe, the regulatory approval process leading to
commercialization and the availability of capital on acceptable
terms to pursue the development of Celacade, and the feasibility of
additional trials. You should not place undue reliance on our
forward-looking statements which are subject to a multitude of
risks and uncertainties that could cause actual results, future
circumstances or events to differ materially from those projected.
These risks include, but are not limited to, the outcome of further
ongoing analysis of the ACCLAIM trial results, the requirement or
election to conduct additional clinical trials and the size and
design of any such trials, delays or setbacks in the regulatory
approval process, difficulties in the maintenance of existing
regulatory approvals, securing and maintaining corporate alliances,
the need for additional capital and the effect of capital market
conditions and other factors on capital availability, the potential
dilutive effects of any financing, risks associated with the
outcomes of our preclinical and clinical research and development
programs, the adequacy, timing, and results of our clinical trials,
competition, market acceptance of our products, the availability of
government and insurance reimbursements for our products, the
strength of intellectual property, reliance on partners,
subcontractors, and key personnel, losses due to fluctuations in
the U.S.-Canadian exchange rate, and other risks detailed from time
to time in our public disclosure documents or other filings with
the Canadian and U.S. securities commissions or other securities
regulatory bodies. Additional risks and uncertainties relating to
our Company and our business can be found in the "Risk Factors"
section of our Annual Information Form and Form 20-F for the year
ended November 30, 2006, as well as in our later public filings.
The forward-looking statements are made as of the date hereof, and
we disclaim any intention and have no obligation or responsibility,
except as required by law, to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise. The consolidated financial statements, accompanying
notes to the consolidated financial statements, and Management's
Discussion and Analysis for the year ended November 30, 2007, will
be accessible on Vasogen's web site at http://www.vasogen.com/ and
will be available on SEDAR and EDGAR. Financial statements are
provided below. VASOGEN INC. (A DEVELOPMENT STAGE COMPANY)
Consolidated Balance Sheets (In thousands of Canadian dollars)
November 30, 2007 and 2006
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2007 2006
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Assets Current assets: Cash and cash equivalents $ 23,545 $ 30,427
Restricted cash - 6,403 Clinical supplies 1,363 1,211 Tax credits
recoverable 1,565 1,327 Prepaid expenses and deposits 787 1,384
Change in fair value of forward foreign exchange contracts 376 -
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27,636 40,752 Property and equipment 414 615 Acquired technology -
253 Deferred financing costs - 150
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$ 28,050 $ 41,770
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Liabilities and Shareholders' Equity Current liabilities: Accounts
payable $ 1,175 $ 3,369 Accrued liabilities 3,519 5,067 Current
portion of senior convertible notes payable - 8,754
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4,694 17,190 Shareholders' equity: Share capital: Authorized:
Unlimited common shares, without par value Issued and outstanding:
22,391,386 common shares (2006 - 15,665,134) 365,670 344,217
Warrants 16,725 11,390 Contributed surplus 22,744 20,347 Deficit
(381,783) (351,374)
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23,356 24,580 $ 28,050 $ 41,770
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VASOGEN INC. (A DEVELOPMENT STAGE COMPANY) Consolidated Statements
of Operations, Deficit and Comprehensive Income (In thousands of
Canadian dollars, except per share amounts)
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Period from December 1, 1987 to Years ended November 30, November
30, 2007 2006 2005 2007
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Expenses: Research and development $ 12,039 $ 32,732 $ 71,421 $
238,917 General and administration 14,259 19,251 22,126 117,228
Foreign exchange loss (gain) 1,977 104 (719) 10,970
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Loss before the undernoted (28,275) (52,087) (92,828) (367,115)
Interest expense on senior convertible notes payable (5) (930)
(344) (1,279) Accretion in carrying value of senior convertible
notes payable (728) (7,824) (1,742) (10,294) Amortization of
deferred financing costs (154) (2,495) (408) (3,057) Loss on
extinguishment of senior convertible notes payable (1,754) (4,995)
- (6,749) Investment income 1,310 1,971 2,274 13,325 Change in fair
value of embedded derivatives 829 - - 829
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Loss and comprehensive loss for the period (28,777) (66,360)
(93,048) (374,340) Deficit, beginning of period: As originally
reported (351,374) (284,719) (187,665) (1,510) Impact of change in
accounting for stock- based compensation - - (4,006) (4,006) Impact
of change in accounting for financial instruments on December 1,
2006 (1,632) - - (1,632)
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revised (353,006) (284,719) (191,671) Charge for acceleration
payments on equity component of senior convertible notes payable -
(295) - (295)
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Deficit, end of period $(381,783) $(351,374) $(284,719) $(381,783)
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Basic and diluted loss per common share $ (1.46) $ (7.05) $ (11.65)
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VASOGEN INC. (A DEVELOPMENT STAGE COMPANY) Consolidated Statements
of Cash Flows (In thousands of Canadian dollars)
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Period from December 1, 1987 to Years ended November 30, November
30, 2007 2006 2005 2007
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Cash provided by (used in): Operating activities: Loss for the
period $ (28,777) $ (66,360) $ (93,048) $(378,346) Items not
involving cash: Amortization 503 782 589 6,160 Accretion in
carrying value of senior convertible notes payable 728 7,824 1,742
10,294 Amortization of deferred financing costs 154 2,495 408 3,057
Loss on extinguishment of senior convertible notes payable 1,754
4,995 - 6,749 Change in fair value of embedded derivatives (829) -
- (829) Stock-based compensation 1,995 3,083 3,615 13,585 Common
shares issued for services - 36 - 2,485 Unrealized gain on forward
foreign exchange contract (376) - - (376) Unrealized foreign
exchange loss (gain) 2,566 (65) (542) 11,543 Other - - - (35)
Change in non-cash operating working capital (3,535) (17,158)
12,634 951
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(25,817) (64,368) (74,602) (324,762) Financing activities: Shares
and warrants issued for cash 17,345 23,106 52,502 326,358 Warrants
exercised for cash - - - 16,941 Options exercised for cash - - 627
7,669 Share issue costs (1,440) (2,221) (3,720) (24,646) Issue
(repayment) of senior convertible notes payable, net (924) (3,976)
42,790 38,512 Cash released from (placed under) restriction 6,403
5,298 (11,701) - Paid to related parties - - - (234)
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21,384 22,207 80,498 364,600 Investing activities: Purchases of
property and equipment (49) (23) (490) (2,465) Purchases of
acquired technology - - - (1,283) Purchases of marketable
securities - (80) (22,999) (244,846) Settlement of forward exchange
contracts 10 (102) (4,732) (4,824) Maturities of marketable
securities - 23,079 67,651 240,677
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(39) 22,874 39,430 (12,741) Foreign exchange loss on cash held in
foreign currency (2,410) (807) (141) (3,552)
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Increase (decrease) in cash and cash equivalents (6,882) (20,094)
45,185 23,545 Cash and cash equivalents, beginning of period 30,427
50,521 5,336 -
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Cash and cash equivalents, end of period $ 23,545 $ 30,427 $ 50,521
$ 23,545
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DATASOURCE: Vasogen Inc. CONTACT: Glenn Neumann, Investor
Relations, 2505 Meadowvale Blvd., Mississauga, ON, Canada, L5N 5S2,
tel: (905) 817-2004, fax: (905) 569-9231, http://www.vasogen.com/,
Copyright