Pharmos Corporation Reports 2001 Results
Sale of Ophthalmic Business Results in Full Year Profit
ISELIN, N.J., March 7 /PRNewswire-FirstCall/ -- Pharmos Corporation (Nasdaq: PARS; Nasdaq Europe: PHRM) today reported financial results for the twelve months ended December 31, 2001. Including a one-time gain of $16 million resulting from the sale of its ophthalmic business to Bausch & Lomb in the fourth quarter, Pharmos reported net income in 2001 of $5,046,000, or $0.09 per share (basic and diluted), compared to a net loss of $7,984,000, or $0.15 per share in 2000. Also during the fourth quarter, Pharmos received a tax credit of approximately $236,000 representing net proceeds from the sale of a portion of its state NOL carry forward under the New Jersey Technology Tax Certificate Program. Cash and cash equivalents, including restricted cash, were approximately $40 million as of December 31, 2001.
Pharmos recorded revenues through the third quarter 2001, but recognized no revenues in the fourth quarter as a result of the sale of the ophthalmic business. This resulted in a decrease of full year revenues to $4,298,000 in 2001, compared to revenues of $5,099,000 in 2000. No such revenues will be recorded in the future. Net research and development expenses increased by 72% to $9,085,000 in 2001 from $5,283,000 in 2000 primarily due to increased employee headcount in connection with the pivotal Phase III trial of dexanabinol and expanded activity in pre-clinical programs studying various dextrocannabinoid compounds.
``Through the successful launch of dexanabinol's pivotal Phase III clinical trial and divestiture of our ophthalmic business, we have raised our profile and positioned Pharmos as an important player in the discovery and development of novel pharmaceuticals for neurological and inflammation-based disorders,'' said Haim Aviv, Ph.D., Pharmos Chairman and CEO.
In January 2001, the Company commenced patient enrollment for its international Phase III trial of dexanabinol for traumatic brain injury (TBI) and showed steady progress in the program throughout the year. No approved drugs are currently available to prevent the cell death and other secondary damage that result from severe trauma to the brain, a market opportunity estimated at approximately $1 billion worldwide. The sale of the ophthalmic business in the fourth quarter, which generated $25 million in initial gross proceeds, increased the Company's financial strength to a level that should enable completion of the current Phase III dexanabinol trial and fund the expansion of the Company's R&D pipeline.
``Our major goals for 2002 are focused in two key areas,'' Dr. Aviv continued. ``First, we are devoting the resources necessary to support the uninterrupted continuation of the Phase III dexanabinol trial by completing the steps necessary to initiate patient enrollment in the US and in additional European countries. Second, we are continuing to expand our pipeline by testing new compounds within our dextrocannabinoid family so that we can advance a second indication, independently or in conjunction with partners, into the clinic.'' Pharmos expects to significantly increase its net research and development expenses to advance these goals, which in combination with the absence of product revenues will result in a loss in 2002. To further build its pipeline, Pharmos is also seeking partnering arrangements, strategic collaborations, in-licensing and other measures that would provide entirely new drug candidates for clinical development.
Gad Riesenfeld, President and COO and Robert Cook, Executive Vice President and CFO, will host a conference call to discuss 2001 results at 11:00 a.m. Eastern Time on March 11, 2002. A live webcast of the conference call will be available in the Investor Relations section of Pharmos' website at pharmoscorp.com and will be archived for a limited time afterwards. |
