VASOGEN INC. 
By MISSISSAUGA, ON,
At
We incurred a net loss for the three months ended
For the three months ended
General and administration expenses were
Highlights
- In January, preclinical findings demonstrating that VP025, the lead
candidate from our VP series of drugs, provides a significant
neuroprotective effect in a model of Parkinson's disease were
published in the European Journal of Neuroscience (Vol 27, pp.294-
300, 2008).
- The results from the phase III ACCLAIM trial of our Celacade System
in patients with chronic heart failure were published in the
January 19th issue of The Lancet (Lancet 2008; 371: 228-36), a world-
leading medical journal. As we previously reported, 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.
- On March 14, 2008, we had a teleconference with the FDA to discuss
and clarify the recent comments from the agency regarding the use of
a Bayesian approach for ACCLAIM II, a clinical trial which is being
planned to support an application for U.S. market approval of the
Celacade System for the treatment of patients with New York Heart
Association ("NYHA") Class II heart failure. The teleconference with
the FDA follows our announcement on March 3rd, stating that the FDA
disagrees with the use of a Bayesian approach for the planned ACCLAIM
II study. This is contrary to the FDA's original communication to us
recommending a Bayesian study design. We have prepared and submitted
a written response to the FDA's comments with respect to the use of a
Bayesian approach in ACCLAIM II.
- Grupo Ferrer Internacional, S.A. ("Ferrer"), our European marketing
partner, has the right to market Celacade for the treatment of
chronic heart failure in certain countries of the European Union
("E.U.") and Latin America. Celacade has already received E.U.
regulatory approval as a medical device under the CE Mark, which
enables marketing of Celacade for the treatment of chronic heart
failure in the 27 member countries of the E.U. Celacade is also the
only CE Mark approved product that specifically targets the
destructive chronic inflammation underlying the development and
progression of heart failure. Under the CE Mark in Europe, Celacade
is approved for the treatment of all NYHA Class II patients and NYHA
Class III, & IV heart failure patients who do not have a history of
prior heart attack. We currently expect that the first clinical sites
in Germany will be in a position to offer Celacade therapy to
patients in April 2008.
Due to the fact that we recently provided a detailed update on corporate
activities during our Annual Shareholders' Meeting on
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
Certain statements contained in this press release, or elsewhere in our
public documents constitute "forward-looking statements" within the meaning of
the
The unaudited interim consolidated financial statements, accompanying
notes to the unaudited interim consolidated financial statements, and
Management's Discussion and Analysis for the three months ended
Summary financial tables are provided below.
VASOGEN INC.
(A DEVELOPMENT STAGE COMPANY)
Interim Consolidated Balance Sheets
(In thousands of Canadian dollars)
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February 29, November 30,
2008 2007
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(Unaudited)
Assets
Current assets:
Cash and cash equivalents $ 19,930 $ 23,545
Clinical supplies 1,270 1,363
Tax credits recoverable 738 1,565
Prepaid expenses and deposits 600 787
Change in fair value of forward foreign
exchange contracts - 376
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22,538 27,636
Property and equipment 352 414
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$ 22,890 $ 28,050
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Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $ 1,190 $ 1,175
Accrued liabilities 3,429 3,519
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4,619 4,694
Shareholders' equity
Share capital:
Authorized:
Unlimited common shares, without par value
Issued and outstanding:
22,391,386 common shares
(November 30, 2007 - 22,391,386) 365,670 365,670
Warrants 16,725 16,725
Contributed surplus 22,979 22,744
Deficit (387,103) (381,783)
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18,271 23,356
Future operations
Commitments and contingencies
Subsequent events
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$ 22,890 $ 28,050
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VASOGEN INC.
(A DEVELOPMENT STAGE COMPANY)
Interim Consolidated Statements of Operations, Deficit and Comprehensive
Income
(In thousands of Canadian dollars, except per share amounts)
(Unaudited)
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Period from
December 1,
Three months ended 1987 to
February 29, February 28, February 29,
2008 2007 2008
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Expenses:
Research and development $ 2,778 $ 3,023 $ 241,695
General and administration 2,681 3,588 119,909
Foreign exchange loss (gain) 203 (134) 11,173
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Loss before the undernoted (5,662) (6,477) (372,777)
Interest expense on senior
convertible notes payable - (5) (1,279)
Accretion in carrying value of
senior convertible notes payable - (692) (10,294)
Amortization of deferred financing
costs - (145) (3,057)
Loss on extinguishment of senior
convertible notes payable - (1,284) (6,749)
Investment income 342 352 13,667
Change in fair value of embedded
derivatives - 573 829
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Loss and comprehensive loss for
the period (5,320) (7,678) (379,660)
Deficit, beginning of period:
As originally reported (381,783) (351,374) (1,510)
Impact of change in accounting
for stock-based compensation - - (4,006)
Impact of change in accounting
for financial instruments on
December 1, 2006 - (1,632) (1,632)
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As revised (381,783) (353,006)
Charge for acceleration payments
on equity component of senior
convertible notes payable - - (295)
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Deficit, end of period $ (387,103) $ (360,684) $ (387,103)
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Basic and diluted loss per common
share $ (0.24) $ (0.47) $ -
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VASOGEN INC.
(A DEVELOPMENT STAGE COMPANY)
Interim Consolidated Statements of Cash Flows
(In thousands of Canadian dollars)
(Unaudited)
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Period from
December 1,
Three months ended 1987 to
February 29, February 28, February 29,
2008 2007 2008
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Cash provided by (used in):
Operating activities:
Loss for the period $ (5,320) $ (7,678) $ (379,660)
Items not involving cash:
Amortization 62 126 6,222
Accretion in carrying value of
senior convertible notes payable - 692 10,294
Amortization of deferred
financing costs - 145 3,057
Loss on extinguishment of
senior convertible notes payable - 1,284 6,749
Change in fair value of
embedded derivatives - (573) (829)
Stock-based compensation 235 563 9,814
Common shares issued for services - - 2,485
Unrealized gain on forward
foreign exchange contract - - (376)
Unrealized foreign exchange
loss (gain) 192 (100) 11,735
Other - - (35)
Change in non-cash operating
working capital 1,398 (3,475) 2,349
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(3,433) (9,016) (328,195)
Financing activities:
Shares and warrants issued for cash - - 326,358
Warrants exercised for cash - - 16,941
Options exercised for cash - - 7,669
Share issue costs - 3 (24,646)
Issue (repayment) of senior
convertible notes payable, net - (635) 38,512
Cash released from restriction - 3,036 -
Paid to related parties - - (234)
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- 2,404 364,600
Investing activities:
Purchases of property and equipment - (30) (2,465)
Purchases of acquired technology - - (1,283)
Purchases of marketable securities - - (244,846)
Settlement of forward foreign
exchange contracts - 10 (4,824)
Maturities of marketable securities - - 240,677
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- (20) (12,741)
Foreign exchange gain (loss) on cash
held in foreign currency (182) 280 (3,734)
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Increase (decrease) in cash and cash
equivalents (3,615) (6,352) 19,930
Cash and cash equivalents, beginning
of period 23,545 30,427 -
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Cash and cash equivalents, end of
period $ 19,930 $ 24,075 $ 19,930
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SOURCE Vasogen Inc.
