Sprinkle 1 cup sugar in a medium-sized heavy saucepan; place over medium heat, and cook, stirring constantly, 5 minutes or until sugar melts and turns a light golden brown. Quickly pour hot caramelized sugar into a 2-quart flan dish. Using oven mitts, tilt dish to evenly coat bottom and sides. Let stand 5 minutes (sugar will harden).
Whisk together egg yolks, and next 5 ingredients in a large bowl.
Process egg whites, cream cheese, and remaining 1/2 cup sugar in blender until smooth. Stir egg white mixture into egg yolk mixture. Pour mixture through a wire-mesh strainer into a large bowl; pour custard over caramelized sugar.
Place dish in a large shallow pan. Add hot water to pan to a depth of one-thrid up sides of dish.
Bake at 350º for 1 hour and 45 minutes. Remove dish from water bath; cool completely on a wire rack. Cover and chill at least 3 hours.
Run a knife around edge of flan to loosen; invert onto a serving plate.