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Sangamo BioSciences Inc. Reports Operating Results (10-Q)

August 03, 2009 | About:
10qk

Sangamo BioSciences Inc. (SGMO) filed Quarterly Report for the period ended 2009-06-30.

Sangamo BioSciences Inc. is a leader in the development of noveltranscription factors for the regulation of gene expression. Transcriptionfactors are proteins that turn genes on or off by recognizing specific DNAsequences. The Universal Gene Recognition technology platform enables theengineering of a class of transcription factors known as zinc finger DNA binding proteins. Sangamo BioSciences Inc. has a market cap of $234.24 million; its shares were traded at around $5.7 with and P/S ratio of 14.47. Sangamo BioSciences Inc. had an annual average earning growth of 5.9% over the past 5 years.

Highlight of Business Operations:

Revenues from our corporate collaboration and strategic partnering agreements were $4.2 million for the three months ended June 30, 2009, compared to $2.4 million in the corresponding period in 2008. The increase in collaboration agreement revenues was primarily attributable to increased revenues of $1.0 million in connection with our laboratory research reagents license agreement with Sigma-Aldrich Corporation (“Sigma”), increased revenues of $483,000 in connection with our research license and commercial option agreement with Dow AgroSciences LLC (“DAS”), and increased revenues of $366,000 in connection with our research and license agreement with Genentech. Research grant revenues were $513,000 for the three months ended June 30, 2009, compared to $464,000 in the corresponding period in 2008. The increase in research grant revenues was primarily due to increased revenues of $125,000 related to our grant from the Juvenile Diabetes Research Foundation (“JDRF”), partially offset by decreased revenues of $59,000 in connection with our grant from the Defense Advanced Research Projects Agency (“DARPA”).

increased revenues of $250,000 in connection with our agreement with Open Monoclonal Technology, and increased revenues of $228,000 in connection with our research and license agreement with Genentech. Research grant revenues were $513,000 for the six months ended June 30, 2009, compared to $1.1 million in the corresponding period in 2008. The decrease in research grant revenues was primarily due to decreased revenues of $282,000 related to our grant from the Michael J. Fox Foundation, decreased revenues of $250,000 related to our grant from JDRF, and decreased revenues of $113,000 in connection with our grant from DARPA.

Research and development expenses were $6.9 million for the three months ended June 30, 2009, compared to $8.3 million in the corresponding period in 2008. The decrease in research and development expenses was primarily attributable to decreased pre-clinical and manufacturing expenses of $1.5 million, primarily associated with our HIV / AIDS and glioblastoma multiforme programs, and decreased expenses related to consulting of $262,000 and lab supplies of $184,000. This decrease was partially offset by increased clinical trials expenses of $454,000, primarily associated with our Phase 2 ALS study.

Research and development expenses were $14.1 million for the six months ended June 30, 2009, compared to $16.9 million in the corresponding period in 2008. The decrease in research and development expenses was primarily attributable to decreased pre-clinical and manufacturing expenses of $1.9 million, primarily associated with our HIV / AIDS and glioblastoma multiforme programs, and decreased expenses related to consulting of $507,000, lab supplies of $368,000 and stock-based compensation of $111,000. This decrease was partially offset by increased clinical trials expenses of $377,000, primarily associated with our Phase 2 ALS study.

During the six months ended June 30, 2009, the net cash used in operating activities was $13.2 million. Net cash used in operating activities related to our net loss of $11.3 million and changes in operating assets and liabilities of $4.5 million. The changes in operating assets and liabilities were primarily comprised of decreases in deferred revenues of $4.0 million and decreases in accounts payable and accrued liabilities of $1.3 million, partially offset by increases in accrued compensation and employee benefits of $595,000 and decreases in accounts receivable of $487,000. This was partially offset by net non-cash charges of $2.7 million. Non-cash charges were primarily comprised of $3.0 million related to stock-based compensation and $291,000 in depreciation and amortization, partially offset by foreign currency remeasurement gains of $493,000. During the six months ended June 30, 2008, net cash used in operating activities of $18.2 million related to our net loss of $15.4 million and changes in operating assets and liabilities of $5.2 million. The changes in operating assets and liabilities were primarily comprised of increases in accounts receivable of $8.8 million, decreases in accounts payable and accrued liabilities of $927,000, decreases in accrued compensation and employee benefits of $358,000, partially offset by increases in deferred revenues of $4.8 million. This was partially offset by net non-cash charges of $2.5 million. Non-cash charges were primarily comprised of $3.0 million related to stock-based compensation and depreciation and amortization of $244,000, partially offset by amortization of premium / discount on marketable securities of $776,000.

During the six months ended June 30, 2009, net cash provided by investing activities was $7.8 million and was primarily comprised of maturities of marketable securities of $36.5 million, partially offset by purchases of marketable securities of $28.7 million. During the six months ended June 30, 2008, net cash provided by investing activities was $13.5 million and was primarily comprised of maturities of marketable securities of $51.1 million and proceeds from sales of investments of $4.0 million, partially offset by purchases of marketable securities of $41.0 million.

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