Our Pipeline
A key to our long-term success
resides in our ability to continue to fund our broad-based,
deep and innovative pipeline of follow-on products in all
three disease areas. We believe Tarceva will prove to be
just the first compound in our oncology arsenal. Two other
drug candidates, OSI-930 and OSI-906, are already in various
stages of development. OSI-930 is designed to target both
cancer-cell proliferation and blood-vessel growth (angiogenesis)
in selected tumors. OSI-906 is a selective inhibitor of the
IGF-1R receptor – widely recognized as a key target
of growth regulation in cancer cells, but one that has proven
to be difficult to address despite repeated efforts throughout
the pharmaceutical industry.
In the eye-disease arena, OSI is studying the use of Macugen
and other anti-VEGF agents in combination with a novel anti-platelet
derived growth factor aptamer. We are also developing controlled-release
formulations of Macugen that could allow for only twice yearly
intra-ocular injections in the future.
Meanwhile, our emerging diabetes clinical pipeline – one
that reflects our historical target-based discovery efforts
in this area – has us well-positioned to provide prospective
partners with a pipeline of innovative and competitive diabetic
drug candidates. In addition to PSN9301, our DP-IV inhibitor
in Phase II trials, we have advanced our glycogen phosphorylase
inhibitor, PSN357, to Phase IIa trials and recently began
clinical trials on PSN010,
our glucokinase activator.
Financials & Corporate
Governance
2005 and the approval of Tarceva
marked the start of our commitment to deliver profitability
within 2-3 years of Tarceva launch. In 2005, we recorded
revenues of $174 million, up from $44 million in 2004 and
a clear indicator of our progress in this regard. With the
addition of Macugen revenues following the Eyetech deal we
have established the necessary scale to our business which
we believe favors long-term success. We are committed to
managing our R&D and SG&A spend in a tightly controlled
manner until our revenue growth delivers solid profitability
and adds real financial strength to our existing R&D
prowess.
In December 2005, we strengthened the cash position on our
balance sheet by issuing $115 million aggregate principal
of 2% Convertible Senior Subordinated Notes due 2025. The
sale of the notes generated net proceeds of approximately
$111 million, allowing us to complete 2005 with more than
approximately $180 million in cash and short-term investments.
In taking a long-term view of growing a successful business
we recognize that our shareholders deserve an appropriate
means to voice opinions on sizeable strategic initiatives,
and we have taken some constructive governance steps to ensure
this in the future.
In closing, we want to particularly thank our shareholders
for being our long-term partners on the road to success.
We would also like to thank our employees and recognize their
tremendous commitment to our patients. And to the patients
themselves and their families, who by their participation
in clinical trials show their belief in our novel therapies
for cancers,
eye diseases, and diabetes and obesity, we pledge to work
every day to continue shaping medicine and changing lives.
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Colin Goddard, Ph.D.
Chief Executive Officer |
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Robert A. Ingram
Chairman of the Board |
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