Semi-annual report 1 january – 30 june 1999
SEMI-ANNUAL REPORT
1 JANUARY – 30 JUNE 1999
*In the collaboration project with Bristol-Myers Squibb additional animal
trials show continuous promising properties for the compounds in development.
The objective is to select a compound for entry into clinical trials later
this year.
*The Merck project boasts several ongoing animal studies in various disease
models, using selective compounds.
*Recent clinical findings and new animal trials strengthen Karo Bio’s project
aiming at treatment of type 2 diabetes.
*A proof of principle study regarding treatment of skin atrophy with thyroid
hormone analogs supports the concept. Planning of a clinical phase I/II study
is ongoing.
*Net sales for the period amounted to SEK 30.6 million (30.6)
*Net loss after financial items for the period amounted to SEK -21.1 million
(-9.2).
*Liquid funds and short-term investments as of 30 June amounted to SEK 192.3
million, compared with SEK 209.1 million as of 31 December 1998.
KARO BIO AB
Novum, Hälsovägen 7, 141 57 Huddinge, Sweden
Telephone: +46 (0)8-608 60 00; Fax: +46 (0) 8-774 82 61; E-mail:
info@karobio.se; website: https://www.karobio.se/
OPERATIONS
Karo Bio is a drug discovery company working with the development of receptor
and tissue-selective drugs for the treatment of widespread diseases that are
responsive to nuclear receptors. Operations are conducted in collaboration
with international pharmaceutical companies and leading academic institutions
in Sweden and other countries.
The company is engaged in four different research programs:
* Estrogen receptors (ER):
Within the field of women’s health care, e.g., menopausal symptoms,
osteoporosis, cardiovascular disease and cancer.
* Thyroid hormone receptors (THR):
Cardiac arrhythmia, metabolic disorders, glaucoma and skin disorders.
* Glucocorticoid receptors (GR):
Type 2 diabetes and inflammatory diseases.
* Orphan receptors:
Discovery and characterization of new nuclear receptors as targets for
development of new pharmaceuticals.
COLLABORATIVE PROJECTS
Bristol Myers Squibb – Metabolic disorders (THR)
Additional animal trials show continuous promising properties for the
compounds in development which lower cholesterol, triglycerides and increase
metabolic rate leading to weight loss at doses not having adverse cardiac
effects. One of the main objectives is to select a compound for entry into
clinical trials later this year.
Merck & Co. – Estrogen Receptor (ER)
The Merck collaboration is broad, generating compounds and biological
information related to estrogen receptor subtypes. The project boasts several
ongoing animal studies in various disease models, using selective compounds.
INTERNAL PROJECTS
Cardiac Arrhythmia – THR
Karo Bio has decided to seek a partner for the further development of the
pharmaceutical compound KB 130 015 and concentrate in house development to a
new generation of compounds. Evaluation of such compounds is on-going with
focus on atrial fibrillation, which may constitute the major clinical
application.
Skin disorders – THR
The clinical findings in the proof of principle study regarding skin atrophy
support the concept of treatment with thyroid hormone analogs. Planning of a
phase I/II study is in progress.
Glaucoma – THR
Positive animal studies were concluded during spring and are now being
followed up by development of a suitable product that can be administered as
eye drops.
Type 2 Diabetes – GR
Several compound classes are now available and new animal data further
supports the feasibility of treating type 2 diabetes using Karo Bio’s novel
concept. The project is aimed at reducing the hepatic glucos production by
antagonizing the glucocorticoid receptor in the liver. Recent clinical
findings strengthen the method.
Other research and development
Characterization of different orphan receptors and evaluation of additional
clinical indications are in progress, aimed at starting new research programs.
Additional orphan receptors have been identified and cloning is ongoing.
The Company’s collaborative partnerships with Karolinska Institutet and other
academic institutions, the objective of which is to further survey the
function of both estrogen receptors in various tissues, have yielded
interesting results that has lead to new patent applications.
Additional key competencies have been recruited during the year. The total
number of employees as of 30 June was 80, compared with 74 at year-end 1998
and 68 as of 30 June 1998. Of the Company’s employees, 72 are engaged in
research.
INCOME AND PROFIT/LOSS
Net sales for the Group and the Parent Company during the period amounted to
SEK 30.6 (30.6) million. Group costs increased according to plan to SEK 56.2
(44.6) million following the increases in personnel since the first quarter of
1998, new academic research projects and pre-clinical studies. The new
employees are engaged primarily with internal projects.
Net results for the Group amounted to SEK – 21.1 (-9.7) million. The Parent
Company’s net result was SEK – 18.5 (-7.4) million. The difference between the
Group and parent Company is made up of depreciation of goodwill in the amount
of SEK 2.6 (2.6) million.
Earnings per share for the period were SEK – 2:30 (-1:14), calculated upon the
average number of shares. Owing to the negative results and losses carried
forward of SEK 419 million for the Group, the period’s results were not
subject to tax.
LIQUIDITY AND SHAREHOLDERS’ EQUITY
Liquid funds for the Group, including short-term investments, amounted to SEK
192.3 million as of 30 June 1999 (209.1 as of 31 December 1998). The Group has
no interest-bearing loans. Shareholders’ equity as of 30 June 1999 was SEK
223.2 million (SEK 244.3 million as of 31 December 1998).
The remaining 164,224 Series C shares were converted in February to Series B
pursuant to the agreement with the former owners of Serra Pharmaceuticals Inc.
(Karo Bio Inc.). The Company’s share capital of SEK 45,885,860 was thereafter
divided among 9,177,172 Series B shares. Since all shares were in Series B,
the Annual General Meeting on 22 April decided to amend the articles of
association and thereby convert all B-shares to Shares.
INVESTMENTS
The Group and Parent Company’s investments in equipment during the period
amounted to SEK 2.1 (7.2) million. The investments were primarily in IT
equipment for crystallography and a consequence of the expansion.
SCHEDULED RELEASES OF FINANCIAL INFORMATION
Interim Report, January-September 18 October 1999
Release of unaudited figures for 1999 9 February 2000
The Company’s auditor has not reviewed this report.
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The following files are available for download:
https://www.bit.se/bitonline/1999/07/12/19990712BIT00110/bit0001.doc
https://www.bit.se/bitonline/1999/07/12/19990712BIT00110/bit0002.pdf
https://www.bit.se/bitonline/1999/07/12/19990712BIT00110/bit0003.xls Consol Income Statement