Human Genome Sciences, a Rockville company that is developing gene-based therapies for various illnesses, reported a third-quarter net loss of $68.9 million yesterday -- more than five times its loss a year ago -- largely because of one-time expenses related to the conversion of debt to equity.
The company also reported decreased revenue from its collaborative contracts with pharmaceutical companies, saying they brought in $642,000 in the quarter that ended March 31, compared with $1.4 million a year ago. The decrease was related to the expiration of a three-year contract with the former Pharmacia & UpJohn Inc., which was using HGS genomes in its own drug-development efforts, Chief Financial Officer Steven C. Mayer said.
Human Genome's quarterly loss equated to $1.34 a share, compared with a loss of $12.3 million, or 27 cents per share, in the year-ago quarter. Human Genome, however, reported $915.1 million in cash and short-term investments on hand, giving it a substantial war chest with which to keep developing its therapies for venous ulcers and other maladies. The company raised $525 million of that money during the quarter through two offerings of convertible subordinated notes.
The increased loss largely was attributable to one-time expenses of $50.8 million, or 99 cents per share, related to the conversion of two convertible subordinated notes to equity. The costs involve making note-holders whole for the interest they had expected to receive over a three-year period, Mayer said.
Excluding that one-time expense, the company's net loss was $18.1 million, or 35 cents per share.
Shares of Human Genome closed at $62.625, down $1.4375 on the Nasdaq stock market.