CytoTherapeutics Reports Second Quarter Results

LINCOLN, R.I. -- (BW HealthWire) -- Aug.16, 1999 -- CytoTherapeutics, Inc. (NASDAQ:CTII) today reported a net loss for its second quarter ended June 30, 1999, of $1,840,000, or $0.10 per share, compared to a net loss of $4,048,000, or $0.22 per share, in the second quarter of 1998. Revenues from collaborative arrangements for the second quarter of 1999 totaled $2,521,000, compared to $1,907,000 in the corresponding quarter of 1998. The increase in revenues of $614,000, or 32%, resulted from increased funding for the quarter from AstraZeneca Group plc related to research and development of the encapsulated cell program for chronic pain. However, on June 24, 1999, AstraZeneca terminated its collaboration agreement with the Company. As a result of termination of the AstraZeneca agreement, the Company expects to incur substantial wind down costs in the second half of 1999. The results for the first six months will not be indicative of results for the balance of the year.

The net loss for the first six months of 1999 was $3,773,000, or $0.20 per share, compared with a net loss of $7,567,000, or $0.42 per share, for the same period in 1998. Revenues from collaborative arrangements for the six months ended June 30, 1999 and 1998 were $5,022,000, and $3,750,000, respectively, substantially all of which were obtained from the terminated Astra relationship. Cash, cash equivalents and marketable securities totaled $11,788,000 on a consolidated basis at June 30, 1999.

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CytoTherapeutics, Inc. is a biotechnology company focused on the discovery, development and commercialization of cell-based therapies. For additional information, visit the Company's Internet web site at http://www.cyto.com.

Statements in this press release other than statements of historical facts constitute forward looking comments regarding, among other things, future business operations and results. The company's actual results may vary materially from those forward looking statements due to risks and uncertainties to which the company is subject, such as failure to achieve required product development, delays in obtaining, or failure to satisfy conditions imposed for, regulatory approval, the need to raise additional capital, regulatory requirements, risks of third-party intellectual property, adverse clinical developments, and other risks, which are described in Exhibit 99 to the company's Annual Report on Form 10-K entitled "Cautionary Factors Relevant to Forward Looking Statements."


CytoTherapeutics, Inc.
Selected Consolidated Financial Information (unaudited)
Condensed Consolidated          Three Months Ended   Six Months Ended
Statements of Operations       June, 30, June 30,   June, 30, June 30,
                                    1999   1998       1999      1998
Revenue from collaborative
 arrangements              $2,520,672 $1,906,588 $5,021,707 $3,749,563
Operating expenses:
  Research and development  3,280,826  4,917,357  6,847,383  9,417,019
  General and 
   administrative           1,172,856  1,264,249  2,168,315  2,411,255
                            4,453,682  6,181,606  9,015,698 11,828,274
                                            
Operating loss             (1,933,010)(4,275,018)(3,993,991)(8,078,711)
Other income, net             92,991     226,645    221,277    511,801
Net loss                ($1,840,019)($4,048,373)($3,772,714)($7,566,910)
Basic and diluted net
 loss per share               ($0.10)    ($0.22)    ($0.20)   ($0.42)
Shares used in computing
 basic and diluted net 
 loss per share           18,514,236 18,199,870  18,483,437 18,192,212

Condensed Consolidated Balance Sheets
                                           June 30,      December 31,
                                             1999             1998
Cash, cash equivalents and marketable
 securities                               $11,788,284     $17,385,727
Prepaids and other current assets             724,363       1,048,283
Property, plant and equipment, net          7,588,565       8,356,009
Other assets                                6,070,157       6,075,663
Total assets                              $26,171,369     $32,865,682
Total current liabilities                  $2,867,334      $5,547,824
Long-term obligations and other
 long-term liabilities                      3,464,426       3,984,340
Redeemable common stock                     5,248,610       5,248,610
Common stock to be issued                     187,500         187,500
Total stockholders' equity                 14,403,499      17,897,408
Total liabilities and stockholders'
 equity                                   $26,171,369     $32,865,682

     
     CONTACT: CytoTherapeutics, Inc.      CytoTherapeutics, Inc.
              Richard M. Rose, M.D.       Elizabeth A. Razee
              (401) 288-1000              (401) 288-1000