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Rigel Reports Fourth Quarter and Year 2000 Financial Results

South San Francisco, CA - February 07, 2001

South San Francisco, CA, February 7, 2001 Rigel Pharmaceuticals, Inc. (Nasdaq: RIGL) today reported financial results for the fourth quarter and year ended December 31, 2000. For the fourth quarter of 2000, Rigel reported a net loss of $5.8 million, or $0.36 per common share, compared to $4.4 million, or $1.49 per common share, in the fourth quarter of 1999. For the year ended December 31, 2000, Rigel reported a net loss to common shareholders of $35.5 million, or $4.89 per common share, compared to a net loss of $12.4 million, or $4.39 per common share, in 1999. The 2000 net loss to common shareholders included a non-cash, non-recurring deemed dividend to Series E preferred stockholders of $10.1 million. Without this non-cash charge, and including all shares of preferred stock that converted to common stock upon the closing of our IPO, Rigels net loss for the year ended December 31, 2000 would have been $25.4 million, or $0.86 per share.

The company reported cash, cash equivalents, and short-term investments of $53.0 million at December 31, 2000, compared with $5.8 million at December 31, 1999. The increase in cash balances was due primarily to the successful completion of two private placements and Rigels initial public offering during 2000, which in the aggregate provided approximately $60.6 million in net proceeds to the company.

Rigel reported revenues from research collaborations of $3.2 million in the fourth quarter of 2000 and $13.2 million for the year, compared to revenues of $3.1 million in the fourth quarter of 1999, and $9.0 million for the year ended December 31, 1999. Total costs and expenses were $9.1 million in the fourth quarter of 2000, compared with $7.4 million for the comparable 1999 period. For the years ended December 31, 2000 and 1999, Rigel reported costs and expenses of $38.7 million and $21.1 million, respectively. The costs and expenses in 2000 include non-cash stock compensation expenses of $10.2 million.

"During 2000, Rigel made tremendous progress on both the scientific and operational sides of our business," said James M. Gower, president and chief executive officer. "We continued to rapidly build a broad portfolio of product development programs designed to generate small molecule therapeutics that we intend to license, following initial demonstration of efficacy in humans, to pharmaceutical and biotechnology companies that are facing increasing pressure to fill their product pipelines. In fact, we plan to enter the clinic with our first drug candidate in 2002. "

"On the business side, we completed our IPO and two private placements, the proceeds from which will help support Rigel's growth as we continue to build our portfolio with partners and on our own," Mr. Gower said. Accordingly, we intend to augment our internal resources and infrastructure to support preclinical and early-stage clinical work on the programs that Rigel will develop through Phase II trials. We believe that this portfolio strategy not only enables the simultaneous development of multiple potential revenue-generating programs, but also reduces the substantial costs and risks of failure historically associated with Phase III trials."

In line with this strategy, Rigel anticipates that costs and expenses during 2001 will be approximately $45-$50 million, which we expect to support approximately 50 new positions in addition to the 110 on staff at year end 2000. These new employees are expected to be primarily focused on research and preclinical development of Rigel's unpartnered, proprietary programs. Rigel estimates revenues of $20-$25 million in 2001, based on existing collaborations and current expectations for commencement of new research and development collaborations.

Rigel uses post-genomics combinatorial biology technology to discover novel drug targets. Post-genomics combinatorial biology technology is designed to identify molecules which play an important role in regulating a human cells response to disease by testing a very large number of proteins in a very large number of cells to determine which proteins will change the cells response to the disease. Rigel currently has programs in asthma/allergy, autoimmunity, transplant rejection, rheumatoid arthritis, inflammatory bowel disease, cancerous tumor growth and hepatitis C. In addition to its proprietary programs, Rigel has research and product development collaborations with Pfizer Inc., Cell Genesys, Inc., Janssen Pharmaceutica N.V. and Novartis Pharma A.G. Rigel is based in South San Francisco, California.

Statements included in this press release that are not historical in nature are "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Words such as "believes," "anticipates," "plans," "expects," "will," "intends" and similar expressions are intended to identify forward-looking statements. We caution readers that forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those indicated in the forward-looking statements, including, among others, the risks identified in Rigel's Registration Statement on Form S-1, No. 333-45864, as amended. The information in this press release is current as of its release date. Rigel does not intend to update the forward-looking information contained in this press release.