All amounts are in U.S. dollars (except for share and per
share data and where otherwise noted).
QUEBEC CITY, May 18
/PRNewswire-FirstCall/ - Aeterna Zentaris Inc. (NASDAQ: AEZS)
(TSX: AEZ) (the "Company"), a late-stage drug development
company specialized in oncology and endocrine therapy, today
reported financial and operating results as at and for the first
quarter ended March 31,
2011.
First Quarter 2011 Highlights
- Agreement signed with Yakult Honsha Co. Ltd. ("Yakult") for the
development, manufacture and commercialization of perifosine, in
Japan. The Company received an
initial upfront payment of €6 million (approximately
$8.4 million) and is also entitled to
receive up to a total of €44 million (approximately
$62.5 million) upon achieving certain
pre-established milestones, including clinical and regulatory
events in Japan, as well as
double-digit royalties on future net sales of perifosine in
Japan. The Company has also agreed
to supply perifosine, on a cost-plus-basis, to Yakult.
- Receipt of net sales royalty milestone payment of $2.5 million from Cowen Healthcare Royalty
Partners, L.P. ("Cowen") payable pursuant to the sale, in
December 2008, to Cowen, of the
Company's rights to royalties on future net sales of
Cetrotide®.
- $1.5 million grant, payable over
a three-year period as partial reimbursement of qualifying
expenditures, awarded to the Company by the German Ministry of
Education and Research to develop, up to the clinical stage,
cytotoxic conjugates of the proprietary cytotoxic compound
disorazol Z and peptides targeting G-protein coupled receptors,
including the luteinizing hormone-releasing hormone receptors. The
compounds being developed will combine the targeting principle
successfully employed in Phase 2 with AEZS-108.
- At-the-Market ("ATM") sales agreement signed to sell common
shares through ATM issuances on the NASDAQ for aggregate gross
proceeds not to exceed $19.8 million. During the three-month period
ended March 31, 2011, the Company
issued approximately 2.7 million common shares under the ATM sales
agreement for aggregate gross proceeds of approximately
$5.1 million.
- Appointment of Michael Meyers,
MPH, to the Company's Board of Directors. Mr. Meyers is a
co-founding member, Chief Executive Officer and Chief Investment
Officer of Arcoda Capital Management LP, managing the Arcoda Global
Healthcare Funds, which are long-short funds investing primarily in
publicly traded equity securities of healthcare companies across a
range of healthcare sub-sectors.
Subsequent to Quarter-End
- Two posters on perifosine presented at the annual meeting of
the American Association for Cancer Research ("AACR"). Perifosine
demonstrated antitumor activity in several gastric cancer cell
lines and enhanced the antitumor activity of 5-FU in parts of the
cell lines - including 5-FU resistant cell lines. Results also
showed the synergistic effects of perifosine with cytotoxic drugs,
including bortezomib and 5-FU.
- One poster presented on the Company's highly selective Erk 1/2
inhibitor anticancer compound, AEZS-131, at the AACR meeting.
AEZS-131 which targets the Raf-Mek-Erk pathway, demonstrated
proof-of-concept in vivo after oral administration,
underlining the potential of this approach in patients that are
refractory to current treatment regimens.
- In April 2011, the Company issued
a total of approximately 7.3 million common shares for aggregate
gross proceeds of approximately $14.7
million, which represented the remaining aggregate gross
proceeds available in connection with the ATM sales agreement.
Juergen Engel, Ph.D., Aeterna
Zentaris President and Chief Executive Officer, commented, "The
quarter was marked mainly by the agreement with Yakult for our lead
anticancer compound, perifosine, for the Japanese market. We are
very proud of this accomplishment which is further proof of the
confidence in the potential of this novel compound. We will now
focus on pursuing the development of our main value drivers with
the completion of the Phase 3 trial with perifosine in refractory
advanced colorectal cancer by year-end and the progression of the
Phase 3 trial in multiple myeloma, as well as the initiation of a
pivotal trial with AEZS-108 in endometrial cancer".
Dennis Turpin, CA, SVP, Chief Financial Officer of Aeterna
Zentaris stated, "With our quarter-end cash position and short-term
investment, together totalling $41.1 million, as well as the $14.7 million gross proceeds from our
completed ATM received in April, we are in a solid financial
position to pursue our focused strategy".
CONSOLIDATED RESULTS AS AT AND FOR THE FIRST QUARTER ENDED
MARCH 31, 2011
The Company's unaudited interim consolidated financial
statements as at and for the three months ended March 31, 2011 represent the Company's first
filing in accordance with International Financial Reporting
Standards ("IFRS"). Comparative unaudited consolidated financial
statements for 2010 have been adjusted to reflect the Company's
adoption of IFRS on a retrospective basis, effective on
January 1, 2010.
Revenues were $7.4 million
for the three-month period ended March 31, 2011, as compared to $6.4 million for the same period in 2010.
This increase is largely related to comparative higher-than-normal
deliveries of Cetrotide® to certain customers, as well
as to the comparative strengthening of the euro against the US
dollar. The increase was partly offset by a slight decrease in
license fee and other revenues.
R&D costs, net of tax credits and grants, amounted to
$5.5 million for the three-month
period ended March 31, 2011,
compared to $6.1 million for the
same period in 2010.
Selling, general and administrative expenses were
$3.2 million for the three-month
period ended March 31, 2011, as
compared to $3.1 million for the
same period in 2010.
Net finance income (costs), comprised predominantly of
net foreign exchange gains and losses, the change in fair value of
the Company's warrant liability and the unrealized gain on the
Company's short-term investment, for the three-month period ended
March 31, 2011 totalled
($1.9 million), as compared to
$1.7 million for the same period
in 2010. This significant increase in finance costs during the
first quarter of 2011 is due to higher foreign exchange losses,
which in turn resulted primarily from the weakening of the US
dollar against the euro during the first quarter of 2011.
Additionally, net finance costs increased during the first
quarter of 2011 due to the change in fair value of the Company's
warrant liability since December 31,
2010. That change results from the periodic "mark-to-market"
revaluation of currently outstanding share purchase warrants.
Net loss for the three-month period ended March 31, 2011 was $10.1 million, or $0.12 per basic and diluted share, compared to
$5.7 million, or $0.09 per basic and diluted share, for the same
period in 2010. This increase is mainly related to higher net
finance costs and higher income tax expense.
Cash and cash equivalents and short-term investment
totalled $41.1 million as at
March 31, 2011.
CONFERENCE CALL
Management will be hosting a conference call for the investment
community beginning at 2 p.m. (Eastern
Time) today, Wednesday, May 18,
2011, to discuss the 2011 first quarter results. Individuals
interested in participating in the live conference call by
telephone may dial, in Canada
514-807-8791 or 416-644-3424, outside Canada, 877-974-0446. They may also listen
through the Internet at www.aezsinc.com in the "newsroom" section.
A replay will be available on the Company's website for 30 days
following the live event.
About Aeterna Zentaris Inc.
Aeterna Zentaris is a late-stage oncology drug development
company currently investigating potential treatments for various
cancers including colorectal, ovarian, endometrial cancer and
multiple myeloma. The Company's innovative approach of
"personalized medicine" means tailoring treatments to a patient's
specific condition and to unmet medical needs. Aeterna Zentaris'
deep pipeline is drawn from its proprietary discovery unit
providing the Company with constant and long-term access to
state-of-the-art therapeutic options. For more information please
visit 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 that 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
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, unless
required to do so by a governmental authority or by applicable
law.
Interim
Consolidated Statements of Comprehensive Loss
Information |
|
|
Three months
ended
March 31, |
(in thousands, except for share and per share
data)
(unaudited) |
2011 |
2010 |
|
$ |
$ |
Revenues |
|
|
Sales and royalties |
7,092 |
5,716 |
License fees and other |
297 |
706 |
|
7,389 |
6,422 |
|
|
|
Operating expenses |
|
|
Cost of sales |
6,023 |
4,617 |
Research and development costs, net of tax credits
and grants |
5,498 |
6,145 |
Selling, general and administrative expenses |
3,159 |
3,057 |
|
14,680 |
13,819 |
|
|
|
Loss from operations |
(7,291) |
(7,397) |
|
|
|
Finance income |
824 |
1,654 |
Finance costs |
(2,749) |
(2) |
Net finance income (costs) |
(1,925) |
1,652 |
|
|
|
Loss before income taxes |
(9,216) |
(5,745) |
Income tax expense |
(841) |
- |
|
|
|
Net loss |
(10,057) |
(5,745) |
|
|
|
Other comprehensive (loss) income: |
|
|
Foreign currency translation adjustments |
(1,339) |
742 |
|
|
|
Comprehensive loss |
(11,396) |
(5,003) |
|
|
|
Net loss per share |
|
|
Basic and diluted |
(0.12) |
(0.09) |
Weighted average number of shares
outstanding |
|
|
Basic and diluted |
83,842,054 |
63,089,954 |
|
|
Interim
Consolidated Statements of Financial Position
Information |
|
(in thousands)
(unaudited) |
As at
March 31,
2011 |
As at
December 31,
2010 |
|
$ |
$ |
|
|
|
Cash and cash equivalents |
38,317 |
31,998 |
Short-term investment |
2,770 |
1,934 |
Trade and other receivables and other current
assets |
9,256 |
9,877 |
Restricted cash |
881 |
827 |
Property, plant and equipment |
3,276 |
3,096 |
Other non-current assets |
14,493 |
13,716 |
Total assets |
68,993 |
61,448 |
|
|
|
Payables and other current liabilities |
15,941 |
13,350 |
Long-term payable (current and non-current
portions) |
124 |
150 |
Warrant liability (current and non-current
portions) |
15,837 |
14,367 |
Non-financial non-current liabilities* |
60,618 |
51,156 |
Total liabilities |
92,520 |
79,023 |
Shareholders' deficiency |
(23,527) |
(17,575) |
Total liabilities and shareholders'
deficiency |
68,993 |
61,448 |
* Comprised mainly of deferred revenues, employee future
benefits and provision.
SOURCE AETERNA ZENTARIS INC.