Strategy of Becoming A Leader in Products and Technologies for the Emerging
High Throughput Screening Market
SUNNYVALE, Calif., Oct. 29 /PRNewswire/ -- LJL BioSystems, Inc. (Nasdaq: LJLB), a leading manufacturer of High Throughput Screening (HTS) products for accelerated drug discovery, today reported financial results for the three months and nine months ended September 30, 1998.
"This quarter was rich with significant milestones, as LJL continues to execute its business strategy of becoming a leader in products and technologies for the emerging High Throughput Screening market," said Lev J. Leytes, LJL's president and CEO. "The highlight of the quarter was the 4th Annual Society of Biomolecular Screening (SBS) Conference and Exhibition, where LJL introduced ACQUEST(TM), which we believe is the world's first commercially available multimode Ultra High Throughput Screening detection system for the high density 1536-well format. In addition, LJL showcased its emerging consumable product lines, an important part of our 'razor/razor blade' strategy, for the first time at SBS. Our podium presentation on LJL's FLARe(TM) technology, for which we recently signed a collaborative agreement with SmithKline Beecham, attracted a large audience. However, the most important achievement during this quarter was growth in new customer leads, purchase orders, including repeat orders for our multimode HTS detection system, ANALYST(TM), and product shipments, contributing to strong revenue growth this quarter."
For the third quarter of 1998, revenues were $1.4 million compared to revenues of $352,000 for the third quarter of 1997. On a sequential basis, revenues increased 34% from revenues of $1.1 million in the second quarter of 1998.
The Company reported a net loss for the quarter of $2.2 million (or $0.21 per share on 10.4 million shares outstanding). In the second quarter of 1998, LJL reported a net loss of $2.0 million (or $0.20 per share on 10.4 million shares outstanding). In the third quarter of 1997, LJL reported a net loss of $1.6 million (or $0.36 per share available to common stockholders) on 4.5 million shares outstanding.
For the nine months ended September 30, 1998, LJL reported revenues of $2.8 million, compared with revenues of $4.9 million for the first nine months of 1997, reflecting the Company's strategic decision to focus on the emerging HTS market and their related exit from clinical OEM product sales and third- party development agreements. The net loss for the first nine months of 1998 was $6.3 million (or $0.73 per share available to common stockholders) on 8.9 million shares outstanding, or $0.64 per share on 9.8 million shares outstanding on a pro forma basis. The net loss for the first nine months of 1997 was $993,000 (or $0.29 per share available to common stockholders) on 4.5 million shares outstanding.
As of September 30, 1998, LJL had $11.4 million in cash, cash equivalents and short-term investments.
New Ultra High Throughput Screening Detection System, ACQUEST, Receives Strong Reception at the Leading Biomolecular Screening Conference.
In September, LJL presented ACQUEST, a 1536-well Ultra High Throughput Screening (UHTS) detection system, at the 4th Annual Society for Biomolecular Screening (SBS) Conference and Exhibition, the leading international conference of its type. ACQUEST received an enthusiastic reception from participants from biotechnology and pharmaceutical companies. Positioned for the high end screening market segment, ACQUEST is designed to give LJL customers the ability to greatly increase the screening throughput up to 200,000 tests per day in certain modes, while significantly reducing their costs per screen. The Company believes that ACQUEST is the first, and so far the only, multimode 1536-well UHTS detection system available for commercial purchase. The first ACQUEST was installed at DuPont Pharmaceuticals Company.
Important Advances in "Razor/Razor Blade" Strategy Implementation, New Consumable Product Lines Are Introduced.
At SBS, LJL launched its proprietary High Efficiency (HE(TM)) microvolume plates that reduce assay volumes while maintaining high assay sensitivity. The Company presented data, showing how HE plates, optimized to match ANALYST's optics, allow approximately 10 times lower consumption of valuable assay materials, leading to much lower screening costs for customers. Also, the Company's first HTS reagents kit for tyrosine kinase, TKX(TM), designed for high throughput and ease of use, was introduced and shipments commenced in July 1998. "The launch of the High Efficiency plates and shipping our first reagent kits are important milestones in implementing of our 'razor/razor blade' strategy of providing customers with not only instrumentation, but also with the consumables, including reagents and plates. We believe that our strategy of being a single focal point supplier of these products (uniquely optimized by LJL's R&D team to work together and deliver increased throughput and lower costs per test) offers a significant value to our customer base. By bringing such integrated solutions to customers, the Company is expecting to increasingly benefit from a flow of continuing consumable revenue as the installed base of LJL's HTS detection systems grows," said Leytes.
SmithKline Gains Early Access to LJL's Novel Technology, FLARe.
During the quarter, the Company signed a collaboration agreement with SmithKline Beecham (SB) under which SB will obtain early access to LJL's novel technology platform, called FLARe. FLARe incorporates proprietary detection methods, instruments and reagents, based on fluorescence lifetime. "Offering a unique set of benefits, FLARe is focused primarily on addressing the emerging drug discovery challenges that we believe cannot be addressed by current technologies," commented Leytes. "We are pleased that a company such as SmithKline Beecham, with one of the most advanced drug discovery programs, has chosen to enter into an early access program with LJL and to collaborate with us in developing this leading edge technology."
Company Profile
LJL is focused on providing high value-added HTS solutions that enable pharmaceutical and biotechnology companies worldwide to implement internal accelerated drug discovery programs. Executing a "razor/razor blade" business strategy, LJL's proprietary technologies are commercialized in two product catagories, uniquely optimized to work together:
* HTS and ultra-HTS detection systems and
* associated consumables, including fluorescence-based assays and plates.
As the installed base of its detection systems grows, LJL is expecting to increasingly benefit from a flow of continuing consumable revenue from such system installations.
The Company's HTS products started shipping in May of 1998 and are currently installed at industry leading companies, including Bristol-Myers Squibb, Eli Lilly and Company, Tularik, Inc., Millennium Pharmaceuticals, Inc., DuPont Pharmaceuticals Company, Amgen, Inc., Monsanto Company, and R.W. Johnson Pharmaceutical Research Institute. In addition, the Company has a collaboration agreement with SmithKline Beecham (SB) under which SB will obtain early access to LJL's novel technology platform, called FLARe, currently under development at LJL. Focused primarily on solving drug discovery problems that the Company believes cannot be solved otherwise, FLARe incorporates proprietary detection methods, instruments and reagents, based on fluorescence lifetime.
Headquartered in Sunnyvale, Calif., LJL has subsidiary operations in Europe. LJL is ISO-9001 certified. The Company's stock is traded on the Nasdaq National Market System under the symbol LJLB. Additional information on LJL's technology and products can be found at http://www.ljlbio.com.
Forward-Looking Statements
Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements that involve certain risks and uncertainties that could cause actual results to differ materially, including such factors among others as the impact of competitive products and pricing, the timely development and market acceptance of new products, market conditions and enforcement of intellectual property rights, the mix between domestic and international sales, and the risk factors listed in the Company's most recent Report on Form 10-Q and its Registration Statement on Form S-1 dated March 13, 1998 (see, in particular, Risk Factors, Management's Discussion and Analysis of Financial Condition and Results of Operations, and Special Note Regarding Forward-Looking Statements). The Company disclaims any intent or obligation to update these forward-looking statements. As a result of these and other factors, the Company expects to experience significant fluctuations in operating results, and there can be no assurance that the Company will become or remain consistently profitable in the future.
LJL BIOSYSTEMS, INC.
CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
(unaudited)
Three Months Ended Nine Months Ended
30-Sep-98 30-Sep-97 30-Sep-98 30-Sep-97
Revenues:
Product sales $1,425,000 $346,000 2,809,000 4,233,000
Development agreements - 6,000 - 642,000
Total revenues 1,425,000 352,000 2,809,000 4,875,000
Costs and operating expenses:
Product sales 776,000 230,000 1,806,000 2,035,000
Research and
development 1,426,000 942,000 4,208,000 2,426,000
Selling, general and
administrative 1,623,000 647,000 3,541,000 1,541,000
Total costs and
operating expenses 3,825,000 1,819,000 9,555,000 6,002,000
Loss from operations (2,400,000) (1,467,000) (6,746,000) (1,127,000)
Interest income, net 207,000 97,000 488,000 146,000
Loss before income taxes(2,193,000) (1,370,000) (6,258,000) (981,000)
Provision for income taxes - - - 12,000
Net loss (2,193,000) (1,370,000) (6,258,000) (993,000)
Preferred stock accretion - (249,000) (254,000) (317,000)
Net loss available to common
stockholders ($2,193,000) ($1,619,000)($6,512,000) ($1,310,000)
Net loss per share available to
common stockholders:
Basic $(0.21) $(0.36) $(0.73) $(0.29)
Diluted $(0.21) $(0.36) $(0.73) $(0.29)
Pro forma (A) $(0.64)
Shares used in computation of net loss
per share available to common
stockholders:
Basic 10,420,246 4,500,500 8,866,504 4,500,500
Diluted 10,420,246 4,500,500 8,866,504 4,500,500
Pro forma (A) 9,818,825
(A) Shares used in computation of pro forma net loss per share for the nine months ended September 30, 1998 are adjusted to reflect the
conversion of the Company's Preferred Stock (that was issued in June 1997)
into Common Stock, as of January 1, 1998.
LJL BIOSYSTEMS, INC.
CONSOLIDATED CONDENSED BALANCE SHEET
(unaudited)
September 30, December 31,
ASSETS 1998 1997
Current assets:
Cash and cash equivalents $1,431,000 $5,525,000
Short-term investments 9,966,000 -
Accounts receivable 756,000 59,000
Inventories 1,373,000 283,000
Other current assets 352,000 484,000
Total current assets 13,878,000 6,351,000
Property and equipment, net 729,000 442,000
Other assets 190,000 -
Total assets $14,797,000 $6,793,000
LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT)
Accounts payable and accrued expenses $1,873,000 $1,041,000
Customer deposits 29,000 153,000
Debt 557,000 86,000
Total liabilities 2,459,000 1,280,000
Preferred stock - 9,308,000
Stockholders' equity (deficit) 12,338,000 (3,795,000)
Total liabilities and
stockholders' equity (deficit) $14,797,000 $6,793,000
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