Aeterna Zentaris Reports First Quarter 2010 Financial and Operating Results
All amounts are in U.S. dollars
QUEBEC CITY, May 13 /PRNewswire-FirstCall/ - Aeterna Zentaris Inc. (NASDAQ: AEZS, TSX: AEZ) ("the Company"), a late-stage drug development company specialized in oncology and endocrinology, today reported financial and operating results as at and for the three months ended March 31, 2010.
First Quarter 2010 Highlights
- January 25, 2010: Updated results of a Phase 2 study related to the use
of perifosine in the treatment of advanced metastatic colon cancer
showing a statistically significant benefit in survival, including
5 FU-refractory patients.
- January 29, 2010: Publication in the February 2010 issue of the Journal
of Clinical Cancer Research of positive Phase 2 results for perifosine
as a single agent for the treatment of advanced Waldenstrom's
macroglobulinemia.
- February 3, 2010: Special Protocol Assessment ("SPA") granted by the
United States Food and Drug Administration ("FDA") for the Phase 3
trial of perifosine in combination with capecitabine (Xeloda(R)) in
refractory advanced colorectal cancer. The trial is to be conducted by
Keryx Biopharmaceuticals, Inc. ("Keryx") (NASDAQ: KERX), Aeterna
Zentaris' partner and licensee for perifosine in North America.
- March 1, 2010: Disclosure that the Committee for Orphan Medicinal
Products of the European Medicines Agency ("EMA") had issued a positive
opinion for orphan medicinal product designation for perifosine for the
treatment of multiple myeloma.
Subsequent to Quarter-End
- April 5, 2010: Perifosine receives FDA Fast Track Designation for the
Phase 3 X-PECT (Xeloda(R) + Perifosine Evaluation in Colorectal cancer
Treatment) registration trial.
- April 8, 2010: Initiation of a Phase 3 registration trial with
perifosine in refractory advanced colorectal cancer by Keryx.
- April 15, 2010: Positive Scientific Advice from the EMA for the Phase 3
program with perifosine in multiple myeloma. Data from ongoing Phase 3
study, sponsored by Keryx, can be used to register perifosine in
multiple myeloma in Europe.
- April 20, 2010: Presentations of preclinical data on Erk inhibitor,
AEZS-131, and Erk/PI3K dual inhibitor, AEZS-132, as well as preclinical
data from a study sponsored by the National Institutes of Health with
perifosine in oncology at the American Association for Cancer Research
Annual Meeting in Washington, D.C.
- April 20, 2010: Completion of a $15.0 million registered direct
offering with certain institutional investors.
- April, 23, 2010: Company regained compliance with Nasdaq's minimum bid
price listing requirement.
- May 6, 2010: Company receives orphan-drug designation from the FDA for
AEZS-108 in ovarian cancer.
- May 12, 2010: FDA approves the Company's Investigational New Drug (IND)
application for AEZS-108 in LHRH-receptor positive urothelial (bladder)
cancer.
Juergen Engel, Ph.D., Aeterna Zentaris' President and Chief Executive Officer commented, "This has been a very exciting quarter as we made great strides in the development of our lead oncology compound, perifosine, now in Phase 3 registration trials for multiple myeloma and refractory advanced colorectal cancer. Furthermore, the different designations recently granted by the FDA in both indications and the EMA's positive Scientific Advice for multiple myeloma, will accelerate as well as facilitate the future review and marketing authorization processes in North America and Europe."
Dennis Turpin, Senior Vice President and Chief Financial Officer of Aeterna Zentaris added, "With more than $40 million in cash, including proceeds from our recent $15 million registered direct offering and no debt, combined with our expected significantly reduced burn rate, we are in a solid financial position to execute our focused drug development and business strategy."
CONSOLIDATED RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2010
Revenues were $6.4 million for the three-month period ended March 31, 2010, compared to $6.1 million for the same period in 2009. The increase is mainly due to a comparative increase in sales of Cetrotide(R) to certain customers in the first quarter of 2010. This increase was partly offset by lower amortization of upfront license fee payments in 2010 related to our agreement with sanofi-aventis U.S. LLC ("sanofi-aventis"), which was entered into in March 2009, in connection with our now discontinued development program involving cetrorelix for the treatment of Benign Prostatic Hyperplasia ("BPH"), and subsequently terminated.
Research and development ("R&D") costs, net of tax credits and grants, were $5.7 million for the three-month period ended March 31, 2010, compared to $11.4 million for the same period in 2009. The comparative decrease in net R&D costs is almost entirely attributable to the winding down and termination of development activities related to cetrorelix in BPH, despite the presence in the first quarter of 2010 of residual expenditures associated with certain remaining contractual obligations.
Selling, general and administrative ("SG&A") expenses were $2.8 million for the three-month period ended March 31, 2010, compared to $3.6 million for the same period in 2009. This decrease is primarily related to lower comparative salary and benefit costs, lower legal expenses and other cost-saving measures.
Net loss was $5.9 million, or $0.09 per basic and diluted share, for the three-month period ended March 31, 2010, compared to $12.4 million, or $0.23 per basic and diluted share, for the same period in 2009. This decrease is mainly related to lower comparative net R&D costs, lower SG&A expenses and higher foreign exchange gains, partly offset by lower comparative license fee revenues and lower sales and royalty margins.
Cash and cash equivalents were $26.9 million as at March 31, 2010. This amount excludes an estimated $13.7 million of net proceeds received in connection with the registered direct offering completed on April 20, 2010.
CONFERENCE CALL
Management will be hosting a conference call for the investment community beginning at 2:30 p.m. Eastern Time today, Thursday, May 13, 2010, to discuss first quarter 2010 results. Individuals interested in participating in the live conference call by telephone may dial in Canada, 514-807-9895 or 647-427-7450, outside Canada, 888-231-8191, or may listen through the Internet at www.aezsinc.com. A replay will be available on the Company's website for 30 days following the live event.
About Aeterna Zentaris Inc.
Aeterna Zentaris Inc. is a late-stage drug development company specialized in oncology and endocrine therapy. News releases and additional information are available at www.aezsinc.com.
Forward-Looking Statements
This press release contains forward-looking statements made pursuant to the safe harbour provisions of the U.S. Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which could cause the Company's actual results to differ materially from those in the forward-looking statements. Such risks and uncertainties include, among others, the availability of funds and resources to pursue R&D projects, the successful and timely completion of clinical studies, the ability of the Company to take advantage of business opportunities in the pharmaceutical industry, uncertainties related to the regulatory process and general changes in economic conditions. Investors should consult the Company's quarterly and annual filings with the Canadian and U.S. securities commissions for additional information on risks and uncertainties relating to the forward-looking statements. Investors are cautioned not to rely on these forward-looking statements. The Company does not undertake to update these forward-looking statements. We disclaim any obligation to update any such factors or to publicly announce the result of any revisions to any of the forward-looking statements contained herein to reflect future results, events or developments except if we are required by a governmental authority or applicable law.
Attachment: Financial summary
Interim Consolidated Statements of Operations
(in thousands, except share and per share data)
(unaudited)
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Three months
ended March 31,
2010 2009
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$ $
Revenues
Sales and royalties 5,716 4,971
License fees and other 706 1,140
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6,422 6,111
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Operating expenses
Cost of sales, excluding depreciation and
amortization 4,617 3,694
Research and development costs, net of tax
credits and grants 5,701 11,437
Selling, general and administrative expenses 2,792 3,554
Depreciation and amortization
Property, plant and equipment 263 311
Intangible assets 389 557
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13,762 19,553
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Loss from operations (7,340) (13,442)
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Other income
Interest income 58 154
Foreign exchange gain 1,402 900
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1,460 1,054
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Net loss for the period (5,880) (12,388)
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Net loss per share
Basic and diluted (0.09) (0.23)
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Weighted average number of shares
Basic and diluted 63,089,954 53,187,470
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Interim Consolidated Balance Sheet Information
(in thousands)
(unaudited)
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As at As at
March 31, December 31,
2010 2009
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$ $
Cash and cash equivalents 26,947 38,100
Accounts receivable and other current assets 10,383 10,913
Restricted cash 833 878
Property, plant and equipment 3,885 4,358
Other long-term assets 29,924 32,013
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Total assets 71,972 86,262
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Accounts payable and other current liabilities 14,777 19,211
Current portion of long-term payable 59 57
Long-term payable 118 143
Non-financial long-term liabilities* 53,848 57,625
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Total liabilities 68,802 77,036
Shareholders' equity 3,170 9,226
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Total liabilities and shareholders' equity 71,972 86,262
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* Comprised mainly of deferred revenues and employee future benefits.
SOURCE AETERNA ZENTARIS INC.
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