Cook 1 cup sugar in a medium-size saucepan 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 1/3 up sides of dish.
Bake 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.
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