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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

For the quarterly period ended March 31, 2004

OR

For the transition period from to

Commission file number: 0-26642

MYRIAD GENETICS, INC.

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code: (801) 584-3600

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  x     No  ¨

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes  x    No   ¨

As of April 28, 2004 the registrant had 27,159,828 shares of $0.01 par value common stock outstanding.

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MYRIAD GENETICS, INC.

INDEX TO FORM 10-Q

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MYRIAD GENETICS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

See accompanying notes to condensed consolidated financial statements (Unaudited).

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MYRIAD GENETICS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

See accompanying notes to condensed consolidated financial statements (Unaudited).

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MYRIAD GENETICS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

See accompanying notes to condensed consolidated financial statements (Unaudited).

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MYRIAD GENETICS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The accompanying condensed consolidated financial statements have been prepared by Myriad Genetics, Inc. (the “Company”) in accordance with accounting principles generally accepted in the United States of America for interim financial information and pursuant to the applicable rules and regulations of the Securities and Exchange Commission. The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. In the opinion of management, the accompanying financial statements contain all adjustments (consisting of normal and recurring accruals) necessary to present fairly all financial statements in accordance with accounting principles generally accepted in the United States. The unaudited condensed consolidated financial statements herein should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the fiscal year ended June 30, 2003, included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2003. Operating results for the three and nine month periods ended March 31, 2004 may not necessarily be indicative of the results to be expected for any other interim period or for the full year.

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

In 2003 the Company adopted the 2003 Employee, Director and Consultant Stock Option Plan, which, together with our earlier stock option plan which has been terminated, are accounted for under the recognition and measurement principles of APB Opinion No. 25, Accounting for Stock Issued to Employees, and related Interpretations. No stock-based employee compensation cost is reflected in net loss, as all options granted under these plans have an exercise price equal to the market value of the underlying common stock on the date of grant and no modifications have been made to any of the awards. The following table illustrates the effect on net loss and loss per share if the Company had applied the fair value recognition provisions of FASB Statement No. 123, Accounting for Stock-Based Compensation, to stock-based employee compensation.

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The components of the Company’s comprehensive loss are as follows (in thousands):

Loss per common share is computed based on the weighted-average number of common shares and, as appropriate, dilutive potential common shares outstanding during the period. Stock options and warrants are considered to be potential common shares.

Basic loss per common share is the amount of loss for the period available to each share of common stock outstanding during the reporting period. Diluted loss per share is the amount of loss for the period available to each share of common stock outstanding during the reporting period and to each share that would have been outstanding assuming the issuance of common shares for all dilutive potential common shares outstanding during the period.

In calculating loss per common share the net loss and the weighted average common shares outstanding were the same for both the basic and diluted calculation.

As of March 31, 2004 and 2003, there were antidilutive potential common shares of 5,961,633 and 4,989,937, respectively. Accordingly, these potential common shares were not included in the computation of diluted loss per share for the periods presented, but may be dilutive to future basic and diluted earnings per share.

On July 1, 2002 Prolexys Pharmaceuticals, Inc. (Prolexys), which is 49 percent owned by the Company, contracted with the Company for the performance of certain high throughput sequencing services. For the three and nine months ended March 31, 2004 the Company recorded approximately $148,000 and $1,606,000 respectively, of revenues under this agreement with Prolexys for services performed, which were recorded as related party research revenue in the accompanying condensed consolidated statements of operations. This agreement was terminated effective January 26, 2004.

The Company’s business units have been aggregated into three reportable segments: (i) research, (ii) predictive medicine, and (iii) drug development. The research segment is focused on the discovery of genes related to major common diseases. The predictive medicine segment provides testing to determine predisposition to common diseases. The drug development segment is focused on the development of therapeutic products for the treatment and prevention of major diseases.

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The accounting policies of the segments are the same as those described in the basis of presentation (note 1). The Company evaluates segment performance based on results from operations before interest income and expense and other income and expense.

The Company has been participating in an arbitration proceeding to resolve certain disputes with a third party. On March 31, 2004, the Company settled the claims resulting from this third party dispute. The primary issues under the dispute related to the calculation and payment of marketing and licensing royalties and fees. The settlement resulted in the mutual release of all claims between the Company and the third party, and required the expensing of approximately $1.7 million above amounts accrued in previous quarters. This amount has been included as part of research and development expense in the accompanying condensed consolidated statements of operations for the three and nine months ended March 31, 2004.

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Executive Summary

We are a leading biopharmaceutical company focused on the development of novel therapeutic products and the development and marketing of predictive medicine products. We employ a number of proprietary technologies that permit us to identify genes, their related proteins and the biological pathways they form. We use this information to better understand the role proteins play in the onset and progression of human disease.

We believe that the future of medicine lies in the creation of new classes of drugs that prevent disease from occurring or progressing and that treat the underlying cause, not just the symptoms, of disease. By understanding the genetic basis of disease, we believe we will be able to develop drugs that are safer and more efficacious. In addition, we believe that advances in the emerging field of predictive medicine will improve our ability to determine which patients are subject to a greater risk of developing these diseases and who therefore would benefit from these new preventive therapies.

Myriad researchers have made important discoveries in the fields of cancer, Alzheimer’s disease, AIDS, depression, and obesity. These discoveries point to novel disease pathways that may pave the way for the development of new classes of drugs. Flurizan^™, our lead therapeutic candidate for the treatment of prostate cancer, is currently in a large, multi-center Phase 2/3 human clinical trial. We are also conducting a Phase 1 human clinical trial for the evaluation of Flurizan^™ for the treatment of Alzheimer’s disease. The Phase 1 study will evaluate the safety of Flurizan^™ in healthy older volunteers and is being conducted at the Mayo Clinic and the University of California, San Diego. We are also conducting a Phase 2 human clinical study in Europe and Canada to assess the efficacy of Flurizan^™ in patients with mild to moderate Alzheimer’s disease. We intend to independently develop and, subject to regulatory approval, market our therapeutic products, particularly in the area of cancer, viral disease, and Alzheimer’s disease.

We also have developed and commercialized a number of innovative predictive medicine products, including BRACAnalysis^®, which assesses a woman’s risk of developing breast and ovarian cancer, COLARIS^® and COLARIS AP^™, which determine a person’s risk of developing colon cancer, and MELARIS^®, which assesses a person’s risk of developing malignant melanoma, a deadly form of skin cancer. In the United States we market these products using our own 100 person sales force. We have complemented our internal sales and marketing efforts through a marketing collaboration with Laboratory Corporation of America Holdings to sell our products to primary care physicians. Predictive medicine revenues were $11.7 million and $30.2 million for the three and nine months ended March 31, 2004, respectively.

We have devoted substantially all of our resources to undertaking our drug discovery and development programs, operating our predictive medicine business, and continuing our research and development efforts. Our revenues have consisted primarily of sales of predictive medicine products, research payments, upfront fees, and milestone payments. We have yet to attain profitability and, for the three and nine months ended March 31, 2004, we had net losses of $10.7 million and $30.2 million, respectively. As of March 31, 2004 we had an accumulated deficit of $128.8 million.

We expect to incur losses for at least the next several years, primarily due to the expansion of our drug discovery and development efforts, the initiation and continuing conduct of human clinical trials, the launch of new predictive medicine products, the continuation of our internal research and development programs, and expansion of our facilities. Additionally, we expect to incur substantial sales, marketing and other expenses in connection with building our pharmaceutical and predictive medicine businesses. We expect that losses will fluctuate from quarter to quarter and that such fluctuations may be substantial.

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Critical Accounting Policies

Critical accounting policies are those policies which are both important to the portrayal of a company’s financial condition and results and require management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. Our critical accounting policies are as follows:

Revenue Recognition. We apply the provisions of Securities and Exchange Commission (SEC) Staff Accounting Bulletin No. 104, Revenue Recognition (SAB 104) to all our revenue transactions. In applying the principles of SAB 104 to our research and technology licensing agreements we consider the terms and conditions of each agreement separately to arrive at a proportional performance methodology of recognizing revenue. Such methodologies involve recognizing revenue in accordance with the percentage-of-completion method of accounting and following the guidance in Statement of Position 81-1, Accounting for Performance of Construction-Type and Certain Production-Type Contracts, as well as other proportional performance methodologies as considered appropriate. Percent complete is estimated based on costs incurred relative to total estimated contract costs. We make adjustments, if necessary, to the estimates used in the percentage-of-completion method of accounting as work progresses and we gain experience. Our estimates of total contract costs include assumptions, such as estimated research hours to complete, materials costs, and other direct and indirect costs. Revenues related to up-front payments and technology license fees when continuing involvement or research services are required of us are recognized over the period of performance.

Allowance for Doubtful Accounts. The preparation of our financial statements requires us to make estimates and assumptions that affect the reported amount of assets at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Trade accounts receivable are comprised of amounts due from sales of our predictive medicine products. We analyze trade accounts receivable and consider historic experience, customer creditworthiness, facts and circumstances specific to outstanding balances, and payment term changes when evaluating the adequacy of the allowance for doubtful accounts. Changes in these factors could result in material adjustments to the expense recognized for bad debts.

Investments in Privately-Held Companies. We review the valuation of our investments in privately-held biotechnology and pharmaceutical companies for possible impairment as changes in facts and circumstances indicate that impairment should be assessed. The amount of impairment, if any, and valuation of these investments are based on our estimates and, in certain circumstances, the completion of independent, third-party appraisals of the investments. Inherent in these estimates and appraisals are assumptions such as the comparability of the investee to similar publicly traded companies, the value of the investee’s underlying research and development efforts, the likelihood that the investee’s current research projects will result in a marketable product, and the investee’s expected future cash flows. Accordingly, the amount recognized by us upon ultimate liquidation of these investments may vary significantly from the estimated fair values at March 31, 2004.

Recent Accounting Pronouncements

In December 2003, the FASB issued a revision to Interpretation No. 46, Consolidation of Variable Interest Entities (FIN46R). FIN46R clarifies the application of ARB No. 51, Consolidated Financial Statements to certain entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without

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additional subordinated financial support. FIN46R requires the consolidation of these entities, known as variable interest entities, by the primary beneficiary of the entity. The primary beneficiary is the entity, if any, that will absorb a majority of the entity’s expected losses, receive a majority of the entity’s expected residual returns, or both.

Among other changes, the revisions of FIN46R (a) clarified some requirements of the original FIN46, which had been issued in January 2003, (b) eased some implementation problems, and (c) added new scope exceptions. FIN46R deferred the effective date of the Interpretation for public companies, to the end of the first reporting period ending after March 15, 2004. The adoption of this interpretation did not have a material effect on our business, results of operations, financial position, or liquidity.

Results of Operations for the Three Months Ended March 31, 2004 and 2003

Predictive medicine revenues for the three months ended March 31, 2004 were $11.7 million compared to $9.3 million for the same three months in 2003, an increase of 26%. Predictive medicine revenue is comprised of sales of predictive medicine products and marketing fees from our predictive medicine product marketing partners. Increased sales and marketing efforts, coupled with recent publications concerning the clinical utility of our products have resulted in wider acceptance of our products by the medical community and increased revenues for the three months ended March 31, 2004. There can be no assurance that predictive medicine revenues will continue to increase at historical rates.

Total research revenues for the three months ended March 31, 2004 were $2.1 million compared to $6.8 million for the same three months in 2003. Related party research revenues included in total research revenues for the three months ended March 31, 2004 and 2003 were $0.1 million and $0.3 million, respectively. Related party research revenue is comprised of certain scientific outsourcing services performed for Prolexys Pharmaceuticals, Inc., which is 49% owned by us. The agreement to provide these scientific outsourcing services was terminated effective January 26, 2004. Research revenues are comprised of research payments received pursuant to collaborative agreements, amortization of upfront fees and milestone payments. This 70% decrease in total research revenue is primarily attributable to the successful completion of our collaboration with DuPont. Research revenue from our research collaboration agreements is generally recognized as related costs are incurred. Consequently, as these programs progress and costs increase or decrease, revenues increase or decrease proportionately.

Predictive medicine cost of revenue for the three months ended March 31, 2004 was $3.7 million compared to $3.4 million for the same three months in 2003. This increase of 10% in predictive medicine cost of revenue is primarily due to the 26% increase in predictive medicine revenues for the three months ended March 31, 2004 compared to the same three months in 2003. This increase was partially offset by technology improvements and efficiency gains in the operation of our predictive medicine business. Our technology and efficiency improvements also contributed to an increase in our gross profit margin, which was 68% for the three months ended March 31, 2004 compared to 64% for the same three months in 2003. There can be no assurance that predictive medicine gross profit margins will continue to increase at historical rates.

Research and development expenses for the three months ended March 31, 2004 were $12.4 million compared to $11.1 million for the same three months in 2003. This increase of 12% was primarily due to increased costs associated with our drug discovery programs and the settlement of claims resulting from a dispute with a third party. The settlement resulted in the mutual release of all claims between the Company and the third party, and required the expensing of approximately $1.7 million above amounts accrued in previous quarters. Other increases in research and development expenses included costs associated with our ongoing clinical trials in prostate cancer and Alzheimer’s disease and other drug discovery and drug development programs, which were partially offset by reduced costs from the completion of our DuPont collaboration. We expect our research and development expenses to continue

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to fluctuate based on changes in our research programs and the progression of our drug development programs.

Selling, general and administrative expenses for the three months ended March 31, 2004 were $8.8 million compared to $7.8 million for the same three months in 2003. Selling, general and administrative expenses consist primarily of salaries, commissions and related personnel costs for sales, marketing, executive, legal, finance, accounting, human resources and business development personnel, allocated facilities expenses and other corporate expenses. This increase of 13% was primarily attributable to general increases in costs to support growth in our predictive medicine business and drug development efforts. We expect our selling, general and administrative expenses will continue to fluctuate depending on the number and scope of new product launches and our drug discovery and drug development efforts.

Results of Operations for the Nine Months Ended March 31, 2004 and 2003

Predictive medicine revenues for the nine months ended March 31, 2004 were $30.2 million compared to $25.3 million for the same nine months in 2003, an increase of 19%. Increased sales and marketing efforts, coupled with recent publications concerning the clinical utility of our products have resulted in wider acceptance of our products by the medical community and increased revenues for the nine months ended March 31, 2004. There can be no assurance that predictive medicine revenues will continue to increase at historical rates.

Total research revenues for the nine months ended March 31, 2004 were $11.4 million compared to $23.3 million for the same nine months in 2003. Related party research revenues included in total research revenues for the nine months ended March 31, 2004 and 2003 were $1.6 million and $1.4 million, respectively. This 51% decrease in total research revenue is primarily attributable to reduced revenue from our collaborations with DuPont and Hitachi, both of which have been successfully completed. Research revenue from our research collaboration agreements is generally recognized as related costs are incurred. Consequently, as these programs progress and costs increase or decrease, revenues increase or decrease proportionately.

Predictive medicine cost of revenue for the nine months ended March 31, 2004 was $9.9 million compared to $9.3 million for the same nine months in 2003. This increase of 7% in predictive medicine cost of revenue is primarily due to the 19% increase in predictive medicine revenues for the nine months ended March 31, 2004 compared to the same nine months in 2003. This increase was partially offset by technology improvements and efficiency gains in the operation of our predictive medicine business. Our technology and efficiency improvements also contributed to an increase in our gross profit margin, which was 67% for the nine months ended March 31, 2004 compared to 63% for the same nine months in 2003. There can be no assurance that predictive medicine gross profit margins will continue to increase at historical rates.

Research and development expenses for the nine months ended March 31, 2004 were $38.7 million compared to $34.2 million for the same nine months in 2003. This increase of 13% was primarily due to increased costs associated with our ongoing clinical trials in prostate cancer and Alzheimer’s disease and other drug discovery and drug development programs, as well as the dispute settlement discussed above. These increased costs were partially offset by reduced costs from the completion of our DuPont and Hitachi collaborations. We expect our research and development expenses to continue to fluctuate based on changes in our research programs and the progression of our drug development programs.

Selling, general and administrative expenses for the nine months ended March 31, 2004 were $24.7 million compared to $24.8 million for the same nine months in 2003. This slight decrease was primarily attributable to a reduction in costs incurred in support of our direct-to-consumer advertising campaign conducted in the prior year which was offset by general increases in our sales and marketing costs to support growth in our predictive medicine business. We expect our selling, general and administrative

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expenses will continue to fluctuate depending on the number and scope of new product launches and our drug discovery and drug development efforts.

Liquidity and Capital Resources

Cash, cash equivalents, and marketable investment securities decreased $31.5 million or 24% from $130.6 million at March 31, 2003 to $99.1 million at March 31, 2004. This decrease in cash, cash equivalents, and marketable investment securities is primarily attributable to capital expenditures for research equipment, leasehold improvements for our new research facilities, increased expenditures for our internal drug development programs and other expenditures incurred in the ordinary course of business. As a result of declining interest rates and decreases in cash, cash equivalents, and marketable investment securities, interest income for the three and nine months ended March 31, 2004 were $0.5 million and $1.6 million, compared to $0.7 million and $2.3 million for the same three and nine months in 2003, respectively.

Net cash used in operating activities was $24.4 million during the nine months ended March 31, 2004 compared to $45.1 million used in operating activities during the same period of the prior fiscal year. Trade receivables increased $2.8 million between June 30, 2003 and March 31, 2004, primarily due to increases in predictive medicine sales during the same period. Other receivables decreased $8.3 million between June 30, 2003 and March 31, 2004, primarily due to payments received under our research collaborations. Accounts payable decreased by $2.5 million between June 30, 2003 and March 31, 2004, primarily as a result of payments for purchases of equipment and lab supplies.

Our investing activities provided cash of $9.1 million in the nine months ended March 31, 2004 and provided cash of $6.0 million in the nine months ended March 31, 2003. Investing activities were comprised primarily of changes to marketable investment securities and capital expenditures for research equipment.

We believe that with our existing capital resources, we will have adequate funds to maintain our current and planned operations for at least the next two years, although no assurance can be given that changes will not occur that would consume available capital resources before such time. Our future capital requirements, cash flows, and results of operations could be affected by and will depend on many factors, including:

On November 9, 2001, we filed a shelf registration statement on Form S-3 (Registration No. 333-73124) with the Securities and Exchange Commission for the sale of up to $250 million of various types of securities. We currently have approximately $193 million of these securities available for sale at our discretion upon filing of a prospectus supplement with the SEC. Because of our significant long-term

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capital requirements, we intend to raise funds when conditions are favorable, even if we do not have an immediate need for additional capital at such time.

Effects of Inflation

We do not believe that inflation has had a material impact on our business, sales, or operating results during the periods presented.

We maintain an investment portfolio in accordance with our Investment Policy. The primary objectives of our Investment Policy are to preserve principal, maintain proper liquidity to meet operating needs and maximize yields. Our Investment Policy specifies credit quality standards for our investments and limits the amount of credit exposure to any single issue, issuer or type of investment.

Our investments consist of securities of various types and maturities of three years or less, with a maximum average maturity of 12 months. These securities are classified as available-for-sale, which are recorded on the balance sheet at fair market value with unrealized gains or losses reported as part of accumulated other comprehensive income. Gains and losses on investment security transactions are reported on the specific-identification method. Dividend and interest income are recognized when earned. A decline in the market value of any marketable investment security below cost that is deemed other than temporary results in a charge to earnings and establishes a new cost basis for the security.

The securities held in our investment portfolio are subject to interest rate risk. Changes in interest rates affect the fair market value of the marketable investment securities. After a review of our marketable securities as of March 31, 2004, we have determined that in the event of a hypothetical ten percent increase in interest rates, the resulting decrease in fair market value of our marketable investment securities would be insignificant to the consolidated financial statements as a whole.

In designing and evaluating our disclosure controls and procedures, our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our management necessarily is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Certain Factors That May Affect Future Results of Operations

The Securities and Exchange Commission encourages companies to disclose forward-looking information so that investors can better understand a company’s future prospects and make informed investment

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decisions. This Quarterly Report contains such “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.

Words such as “may,” “anticipate,” “estimate,” “expects,” “projects,” “intends,” “plans,” “believes” and words and terms of similar substance used in connection with any discussion of future operating or financial performance, identify forward-looking statements. All forward-looking statements are management’s present expectations of future events and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties include, among other things: our inability to further identify, develop and achieve commercial success for new products and technologies; our ability to discover drugs that are safer and more efficacious; our ability to develop predictive medicine products that help determine which patients are subject to greater risk of developing diseases and who would therefore benefit from new preventive therapies; the possibility of delays in the research and development necessary to select drug development candidates and delays in clinical trials; the risk that clinical trials may not result in marketable products; the risk that we may be unable to successfully finance and secure regulatory approval of and market our drug candidates; our dependence upon pharmaceutical and biotechnology collaborations; the levels and timing of payments under our collaborative agreements; uncertainties about our ability to obtain new corporate collaborations and acquire new technologies on satisfactory terms, if at all; the development of competing products and services; our ability to protect our proprietary technologies; patent-infringement claims; risks of new, changing and competitive technologies and regulations in the United States and internationally; and other factors discussed under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended June 30, 2003, which has been filed with the Securities and Exchange Commission.

In light of these assumptions, risks and uncertainties, the results and events discussed in the forward-looking statements contained in this Quarterly Report or in any document incorporated by reference might not occur. Stockholders are cautioned not to place undue reliance on the forward-looking statements, which speak only of the date of this Quarterly Report. We are not under any obligation, and we expressly disclaim any obligation, to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise. All subsequent forward-looking statements attributable to the Company or to any person acting on its behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section.

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PART II—Other Information

Neither the Company nor any of its subsidiaries is a party to any material legal proceedings.

None.

None.

None.

None.

(a) Exhibits

On February 3, 2004, we furnished a Current Report on Form 8-K to disclose that we had publicly disseminated a press release announcing our financial results for the three and six months ended December 31, 2003.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

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