All amounts are in U.S. dollars QUEBEC, Nov. 7
/PRNewswire-FirstCall/ -- AEterna Zentaris Inc. (TSX: AEZ; NASDAQ:
AEZS), a global biopharmaceutical company focused on endocrine
therapy and oncology, today reported financial and operating
results for the third quarter ended September 30, 2007. "Over the
past five months, the executive management team completed a
thorough review of our extensive pipeline and business operations
with the goal of identifying our critical success factors and
placing the appropriate clarity and prioritization surrounding our
key value drivers," said David J. Mazzo, Ph.D., AEterna Zentaris'
President and Chief Executive Officer. "By preparing this strategic
roadmap, we have clearly established a solid foundation for the
basis of our strategy and have identified the strategic levers we
believe will ensure long-term, sustained growth. Our experienced
team is highly focused on execution and committed to realizing the
true value of our Company." KEY DEVELOPMENTS FOR THE THIRD QUARTER
ENDED SEPTEMBER 30, 2007 Change at the Board Level - The Board of
Directors nominated Jurgen Ernst as Chairman of the Board of
Directors and David J. Mazzo, Ph.D., the Company's President and
Chief Executive Officer (CEO), to its Board of Directors. Jurgen
Ernst succeeds Eric Dupont, Ph.D., who founded the Company in 1991
and retired from the Board. Appointment of Chief Medical Officer -
The Company completed its executive management team with the
appointment of Paul Blake, M.D., as Senior Vice President and Chief
Medical Officer. Management's Strategic Review - Management
completed a thorough review of its extensive pipeline and business
operations. RESULTS FOR THE THREE-MONTH PERIOD ENDED SEPTEMBER 30,
2007 At September 30, 2007, the Company had consolidated cash and
short-term investments of $47.6 million compared to $61 million as
of December 31, 2006. Consolidated revenues for the three-month
period ended September 30, 2007 were $11.6 million, an increase of
9.4% compared to $10.6 million for the same period in 2006. The
increase in consolidated revenues is mainly attributed to higher
license fees revenues, partly reduced by lower sales of
Cetrotide(R). The increase in license fees revenues is related to a
milestone payment of $1.4 million received from our partner, Ardana
Biosciences, Ltd., for the initiation of a Phase 3 study for the
diagnosis of growth hormone disorders with our Growth Hormone
Secretagogue, AEZS-130. The sales of Cetrotide(R) were lower for
the three-month period ended September 30, 2007 compared to the
same period in 2006, due to a significant first order of the
product related to the launch in Japan in September 2006.
Consolidated R&D costs, net of tax credits and grants
(R&D), were $10.1 million for the three-month period ended
September 30, 2007 compared to $6.2 million for the same period in
2006. The increase in consolidated R&D expense is related to
the additional expenses incurred for the ongoing Phase 3 program
with cetrorelix in BPH, as well as further advancement of targeted,
earlier clinical-stage development programs including AEZS-108.
Consolidated selling, general and administrative (SG&A)
expenses were $6.1 million for the three-month period ended
September 30, 2007 compared to $4.5 million for the same period in
2006. The increase in consolidated SG&A is related to the
restructuring of the management team and the Board as well as the
opening of a new office in Warren, New Jersey. Consolidated loss
from operations increased to $9.6 million for the three-month
period ended September 30, 2007 compared to $5.8 million for the
same period in 2006. The increase in consolidated loss from
operations is attributable to increased R&D and SG&A
expenses, partly offset by increased revenues. Consolidated net
loss from continuing operations for the three-month period ended
September 30, 2007 was $8.7 million compared to $4.7 million for
the same period in 2006. This increase in consolidated net loss
from continuing operations is attributable to a combination of
higher R&D, SG&A expenses and other expenses recorded
during the three-month period ended September 30, 2007.
Consolidated net earnings from discontinued operations for the
three-month period ended September 30, 2006 were $3.1 million and
were completely attributable to the Company's former subsidiary
Atrium Innovations which operations were excluded from
consolidation effective on October 18, 2006. Consolidated net loss
for the three-month period ended September 30, 2007 was $8.7
million or $0.16 per basic and diluted share, compared to $1.6
million or $0.03 per basic and diluted share for the same period in
2006. The consolidated net loss increase for the three-month period
ended September 30, 2007 is attributable to an increased net loss
from continuing operations combined with the completion of the
distribution of Atrium to AEterna Zentaris shareholders on January
2, 2007. RESULTS FOR THE NINE-MONTH PERIOD ENDED SEPTEMBER 30, 2007
Consolidated revenues for the nine-month period ended September 30,
2007 were $33.8 million compared to $28.8 million for the same
period in 2006. The increase in consolidated revenues is mainly
attributed to increased sales of Cetrotide(R), due to the launch in
Japan in September 2006, growth of Impavido (R), as well as
additional license fees revenues. Consolidated R&D costs, net
of tax credits and grants, for the nine-month period ended
September 30, 2007 were $26.3 million, compared to $20.2 million
for the same period in 2006. The increase in consolidated R&D
expense is related to the additional expenses incurred for the
initiation in 2007 of our ongoing Phase 3 program with cetrorelix
in BPH, as well as further advancement of targeted, earlier
clinical-stage development programs including AEZS-108.
Consolidated SG&A expenses for the nine-month period ended
September 30, 2007, were $15.8 million compared to $12.9 million
for the same period in 2006. The increase in consolidated SG&A
expenses is due to additional expenses related to the restructuring
of the management team and the Board, as well as the opening of a
new office in Warren, New Jersey. Consolidated loss from operations
for the nine-month period ended September 30, 2007 was $23 million
compared to $17.3 million for the same period in 2006. The increase
in consolidated loss from operations is attributable to increased
R&D and SG&A expenses, partly offset by increased revenues.
Consolidated net loss from continuing operations for the nine-month
period ended September 30, 2007 was $18.7 million compared to $15
million for the same period in 2006. This is attributable to higher
R&D and SG&A expenses, partly offset by increased revenues
from Cetrotide(R) and Impavido(R), lower other expenses and higher
income tax recovery. Consolidated net earnings from discontinued
operations for the nine-month period ended September 30, 2006 were
$9.3 million and were completely attributable to the Company's
former subsidiary, Atrium Innovations, which operations were
excluded from consolidation effective on October 18, 2006.
Consolidated net loss for the nine-month period ended September 30,
2007, was $18.7 million or $0.35 per basic and diluted share,
compared to $5.7 million or $0.11 per basic and diluted share for
the same period in 2006. This increase in consolidated net loss is
attributable to an increased net loss from continuing operations
combined with the completion of the distribution of Atrium to
AEterna Zentaris shareholders on January 2, 2007. CONFERENCE CALL
Management will be hosting a conference call for the investment
community beginning at 10:00 a.m. Eastern Time today, Wednesday,
November 7, 2007, to discuss results for the three-month period
ended September 30, 2007. To participate in the live conference
call by telephone, please dial 416-644-3425, 514-807-8791 or
800-595-8550. Individuals interested in listening to the conference
call on the Internet may do so by visiting
http://www.aeternazentaris.com/. A replay will be available on the
Company's Web site for 30 days. About AEterna Zentaris Inc. AEterna
Zentaris Inc. is global biopharmaceutical company focused on
endocrine therapy and oncology with proven expertise in drug
discovery, development and commercialization. News releases and
additional information are available at
http://www.aeternazentaris.com/. Forward-Looking Statements This
press release contains forward-looking statements made pursuant to
the safe harbor 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 requested by a governmental authority or applicable law.
Attachment: Financial summary (In thousands of US dollars, except
share and per share data) Three months ended Nine months ended
CONSOLIDATED RESULTS September 30, September 30, Unaudited 2007
2006 2007 2006
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$ $ $ $ Revenues Sales and royalties 7,919 8,419 24,333 20,222
License fees 3,674 2,211 9,438 8,539
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11,593 10,630 33,771 28,761
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Operating expenses Cost of sales 3,433 3,992 10,092 8,038 Research
and development (R&D) costs, net of tax credits and grants
10,096 6,181 26,295 20,247 Selling, general and administrative
(SG&A) 6,055 4,540 15,823 12,900 Depreciation and amortization
(D&A) 1,596 1,673 4,551 4,889
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21,180 16,386 56,761 46,074
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Loss from operations (9,587) (5,756) (22,990) (17,313) Other
revenues (expenses) (187) 184 (16) (653) Income tax recovery 1,070
903 4,346 2,966
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Net loss from continuing operations (8,704) (4,669) (18,660)
(15,000) Net earnings from discontinued operations - 3,100 - 9,289
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Net loss for the period (8,704) (1,569) (18,660) (5,711)
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Net loss per share from continuing operations Basic and diluted
(0.16) (0.09) (0.35) (0.29) Net loss per share Basic and diluted
(0.16) (0.03) (0.35) (0.11) Weighted average number of shares Basic
and diluted 53,184,803 52,692,065 53,181,248 51,900,754 (In
thousands of US dollars) September December CONSOLIDATED BALANCE
SHEETS 30, 31, Unaudited 2007 2006
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$ $ Cash and short-term investments 47,646 61,019 Other current
assets 19,366 40,704 ---------------------- 67,012 101,723
Long-term assets 66,611 121,768 ---------------------- Total assets
133,623 223,491 ---------------------- ----------------------
Current liabilities 18,640 16,310 Deferred revenues 4,476 8,468
Long-term debt - 704 Other long-term liabilities 9,825 19,130
---------------------- 32,941 44,612 Shareholders' equity 100,682
178,879 ---------------------- Total liabilities and shareholders'
equity 133,623 223,491 ----------------------
---------------------- DATASOURCE: AETERNA ZENTARIS INC. CONTACT:
Jenene Thomas, Senior Director, Investor Relations & Corporate
Communications, (908) 938-1475, ; Paul Burroughs, Media Relations,
(418) 652-8525 ext. 406, Cell.: (418) 575-8982,
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