Advanced Magnetics hopes for June FDA OK

May 24, 2000

Biopharmaceutical company Advanced Magnetics showed a net loss of $1 million for the quarter ended March 31, as it awaits approval of its MR contrast agent, Combidex. That compared to a net loss of $793,858 for the same period a year earlier.

Biopharmaceutical company Advanced Magnetics showed a net loss of $1 million for the quarter ended March 31, as it awaits approval of its MR contrast agent, Combidex. That compared to a net loss of $793,858 for the same period a year earlier. Revenue for the six-month period ended March 31, 2000, was $1.1 million, compared to revenue of $3.2 million for the same period a year earlier.

Advanced Magnetics develops MR contrast agents for the diagnosis of cancer and other diseases. Combidex is designed to aid the diagnosis and staging of lymph node disease. The company is also developing an agent for cardiology and oncology applications.

"This quarter showed progress in conserving our financial resources by cutting our expenses in half in comparison to fiscal 1999," said the company's chairman and CEO, Jerome Goldstein, in a prepared statement.

But industry analyst Robert Bell said Advanced Magnetics' working capital of $19.2 million (as of March 31, 2000) would likely go quickly when the company receives FDA approval of Combidex.

"(The firm is) looking at a burn rate of around $3.5 million to $4 million every three months, and they have yet to take up the marketing," Bell said. "They could run the company for less than a year and a half if their current level of marketing is consistent with the program they must undertake to impact the MR market with their new product."

Advanced Magnetics would have to move from development to marketing, which will require a sales force and other expenses that would use up their reserves more quickly, according to Bell.

"I don't think they can afford to wait a year for FDA approval," he said.