>>Kosan Announces First Quarter 2007 Financial Results; Plans to Introduce Superior Tanespimycin Formulation in 'Time' Registration Program
Wednesday May 9, 4:00 pm ET
New, Enhanced Formulation of Tanespimycin has Stronger Intellectual Property Profile and Improved Properties
HAYWARD, Calif., May 9 /PRNewswire-FirstCall/ -- Kosan Biosciences Incorporated (Nasdaq: KOSN - News) today reported financial results for the quarter ended March 31, 2007.
Net income was $2.7 million or $0.07 per share, compared to a net loss of $10.6 million or $(0.36) per share in the same period last year. The quarterly net income was primarily a result of $10.7 million in revenues recognized in connection with the Company's worldwide motilin agonist license agreement with Pfizer Inc., representing the remaining balance of the $12.5 million up-front fee received in December 2006.
Revenues were $12.9 million for the quarter ended March 31, 2007, compared to $3.0 million in the same period in 2006. Revenues consisted of amortization of the up-front fee received as part of the license agreement with Pfizer and contract revenue for development activities under the Roche-Kosan global development and commercialization agreement for epothilones.
Total operating expenses were $11.1 million, including non-cash stock- based compensation expense of $1.1 million, for the quarter ended March 31, 2007, compared to $13.9 million for the same period last year. Research and development expenses were $9.0 million for the quarter ended March 31, 2007, compared to $11.4 million in the same period in 2006. The decrease for the first quarter compared to the same period in the prior year is primarily due to one-time organization related expenses and higher manufacturing expenses for clinical materials in the first quarter of last year, partially offset by increased clinical development and non-cash stock-based compensation expenses and decreased expenses for early stage projects in the first quarter of this year.
General and administrative expenses were $2.1 million for the quarter ended March 31, 2007, compared to $2.6 million in the same period in 2006. The decrease for the first quarter compared to the same period in the prior year was primarily due to one-time organization related expenses in the first quarter of last year, partially offset by an increase in non-cash stock-based compensation expense.
At March 31, 2007, cash, restricted cash and marketable securities totaled $99.1 million, compared to $64.1 million at December 31, 2006. In February 2007, the Company sold 7,000,000 shares of common stock in a registered direct offering. Net proceeds from the offering were approximately $42.3 million after placement agent fees and other offering expenses.
"Kosan had a strong first quarter," said Robert G. Johnson, Jr., M.D., Ph.D., Kosan's President and Chief Executive Officer. "We strengthened our financial condition with a successful financing. We plan to pursue a robust and broad-based clinical program for our Hsp90 inhibitors: tanespimycin, which is moving into registration studies in multiple myeloma, and alvespimycin, which is moving into Phase 2; implement a robust Phase 2 clinical program for KOS-1584; and advance promising preclinical programs, such as our nuclear export inhibitor program, toward clinical development. We believe that we are well-positioned to maintain and build on our leadership in the Hsp90 inhibitor area and we are pleased with our progress and optimistic about our future."
Introduction of Superior Formulation in Tanespimycin in Myeloma Evaluation (TIME) Program
Kosan's TIME registration program for tanespimycin in multiple myeloma is close to initiation. The company plans to introduce an improved injectable suspension formulation of tanespimycin that will replace the current Cremophor-based formulation. The tanespimycin injectable suspension has several important advantages that Kosan believes will result in a drug candidate with enhanced therapeutic and commercial potential. These advantages include:
-- Potential for more robust and longer patent protection;
-- Elimination of the need for pre-treatment with steroids and
antihistamines to prevent hypersensitivity reactions associated with
Cremophor;
-- Smaller volume of infusion resulting in greater ease of preparation and
administration, the potential for reduced administration time, greater
convenience and comfort for the patient; and
-- Greater solubility and stability, allowing for more cost-effective
shipping and more convenient storage.
The planned change to the new formulation will affect the schedule for initiating the TIME program in order to accommodate communication with clinical sites and protocol amendments, which are already underway. Kosan anticipates initiation of the Phase 2/3 TIME-2 trial in patients with relapsed-refractory disease in the third quarter and that the larger Phase 3 TIME-1 trial in patients with first-relapse disease will follow by one or two quarters.
"We are excited about our improved tanespimycin formulation and its potential to be a better, safer, more convenient and more commercially valuable cancer therapeutic," said Dr. Johnson. "We believe that the benefits of introducing a greatly enhanced product are far greater than the small delay in beginning the TIME program, and that this plan represents our best way forward. We look forward to initiating our TIME registration program in multiple myeloma and our later-stage breast cancer trials of alvespimycin, both of which will be major achievements for our company that will reaffirm our leadership in the Hsp90 inhibitor area, and to initiating a robust Phase 2 program with our epothilone KOS-1584."
Conference Call and Webcast Today
Kosan will hold a conference call to discuss the Company's first quarter 2007 financial results today at 1:30 p.m. Pacific / 4:30 p.m. Eastern. To access the live call, please dial 866.383.7998 (US) or 617.597.5329 (international), access code 56712507. Interested parties may listen to the webcast live at kosan.com by clicking on the "Webcasts" tab under the heading "Investors/Press." The webcast is also being distributed over Thomson's Investor Distribution Network to both institutional and individual investors. Individual investors can listen to the call through Thomson's individual investor center at earnings.com or by visiting any of the investor sites in Thomson's Individual Investor Network. Institutional investors can access the call via Thomson's password-protected event management site, StreetEvents, at streetevents.com. A telephonic replay will be available through May 16, 2007 by dialing 888.286.8010, access code: 93591383. International callers can dial 617.801.6888, access code: 93591383.<<
snip
I'm all for the slight delay if the new formulation helps; this seems like good news to me.
Cheers, Tuck |
