PARIS — Appligène Oncor SA reported a slight drop in revenues for 1997 and warned that a restructuring operation under way will have an adverse impact on earnings for this year.
Revenues last year amounted to FFr38.63 million, 0.3 percent less than the 1996 figure of FFr38.76 million.
Strasbourg-based Appligène, which is a supplier of biological substances and equipment to organizations researching the human genome, reported worse-than-expected results for 1996, when its revenues fell by 6.5 percent from FFr41.5 million the year before. It posted a net loss of FFr11.8 million following a loss of FFr1.7 million in 1995.
In 1997, Appligène's performance varied widely from one country to another, with sales soaring by 34 percent in the U.K., rising 3.4 percent in France and slumping by 16 percent in Germany. France accounts for a little under half its revenues, Germany for 30 percent and the U.K. 20 percent. Despite stagnant revenues, the company stepped up its research and development outlays by 24.5 percent to FFr6.2 million, 16 percent of turnover, in 1997 from FFr5 million in 1996.
French Work Force To Be Reduced
Appligène's chief financial officer, Marc Vander Linden, did not disguise the fact that "the company is going through a very difficult period."
He told BioWorld International that, following two management reshuffles in 1997, the French arm of the company is being downsized to bring its structure into line with its lower-than-planned level of activity. Nine of the 51-person work force are being laid off. At the same time, however, the company has strengthened its British and German sales forces.
The company also has great hopes for its new breast cancer diagnostic kit, the Inform Her-2/Neu gene detection system, which received FDA marketing approval at the end of 1997. Appligène will be filing a marketing application with the French Medicines Agency shortly, and expects to obtain its approval before the end of this year.
The product will then be launched in Europe at the end of 1998 or the beginning of 1999. Beyond that, it is to be developed for use in the detection of other cancers.
Appligène was founded in 1985 and was taken over by Gaithersburg, Md.-based Oncor in 1994. Following an initial public offering on France's Nouveau Marché in July 1996, which raised FFr50 million, Oncor was left with an 80.2 percent stake and outside shareholders with 18.6 percent.
In light of recent developments, Oncor is considering various options for ensuring the group's future, such as teaming up with one or more partners or possibly selling out altogether, and is negotiating with a number of interested companies in the U.S. and Europe.
When it obtained its listing on the Nouveau Marché, Appligène Oncor said its turnover would amount to FFr50 million in 1996 and rise to FFr108 million in 1998, and predicted it would make a net profit of FFr5.6 million this year.
Following announcement of the 1996 results, Vander Linden told BioWorld International that the company's core business (the sale of instruments and reagents) would return to profitability towards the end of 1998 and that the company would show a profit in 1999. But given the substantially greater loss he will have to report for 1997, he is no longer prepared to say when the company might show a profit.