Pharmacopeia Announces Fourth Quarter and Year-End Financial Results for 2007
Thursday February 28, 4:00 pm ET
Company advances DARA in the clinic, adds SARM clinical program and achieves milestones in GSK alliance
PRINCETON, N.J., Feb. 28 /PRNewswire-FirstCall/ -- Pharmacopeia (Nasdaq: PCOP - News) today announced results for the quarter and year ended December 31, 2007, and highlighted several important therapeutic developments and corporate milestones achieved since the completion of the third quarter of 2007.
ADVERTISEMENT
During the fourth quarter of 2007, the company achieved the following milestones:
-- Pharmacopeia announced additional positive results from the company's Phase 1 multiple ascending dose (MAD) study of its lead internal product candidate, PS433540 (DARA). The data demonstrated that PS433540 produced statistically significant, dose dependent increases versus placebo in plasma- renin activity levels, as well as reductions in systolic and diastolic blood pressure. These findings are in addition to previously reported top line results from the MAD trial that showed all doses of PS433540 up to 1,000 mg daily for 4 weeks to be safe and well-tolerated.
This MAD study was designed to evaluate the 14-day safety and tolerability of 50, 100, 250, 500 and 1,000 mg doses of PS433540 in healthy volunteers. Study investigators witnessed a dose dependent increase in plasma-renin activity levels for PS433540, which was more pronounced at Day 15 than at Day 1. This observed increase in plasma-renin activity is indicative of PS433540's ability to block the angiotensin receptor, which is involved in blood pressure control. Furthermore, associated with the increase in plasma-renin activity levels was a decrease in both diastolic and systolic blood pressure for PS433540 of up to 15 mmHg. The company believes that these preliminary results may support the potential use of PS433540 as a new therapeutic option for certain patients affected by hypertension and related disorders.
-- Pharmacopeia announced that it licensed a Phase 1 selective androgen receptor modulator (SARM) program from Bristol-Myers Squibb Company (BMS), including lead and back-up compounds. Pharmacopeia plans to develop the lead compound from this program, PS178990, as a potential novel treatment for muscle wasting associated with end-stage renal disease, cancer- and AIDS- related cachexia and recovery from severe burns and traumatic surgery. The SARM program has a broad portfolio of pending composition of matter patent applications that, if granted, would provide intellectual property coverage to the SARM program through at least 2023. PS178990 has been well characterized both in preclinical studies and in a Phase 1 single ascending dose study. The company plans to conduct several Phase 1 studies in 2008, including the initiation of a multiple ascending dose study of PS178990, to obtain additional safety and tolerability data before entering Phase 2.
In consideration for the SARM program license, Pharmacopeia will apply a portion of its existing medicinal chemistry resources to an unrelated BMS discovery program for up to three years. In addition, the company would pay BMS milestone payments at submission and on approval of a therapeutic product for marketing and a stepped royalty on net sales of therapeutic products, if any, resulting from the SARM program.
-- Pharmacopeia announced that it identified two new lead compounds for advancement in its alliance with GlaxoSmithKline (GSK), through its collaboration with the Center of Excellence for External Drug Discovery. As a result of the identification of these new lead compounds, Pharmacopeia received milestone payments totaling $1 million from GSK. The first of the lead compounds is the initial lead in a program addressing respiratory disease. The other newly identified lead compound is the second from a program in inflammatory pain.
Subsequent to the end of the year:
-- Pharmacopeia announced the completion of recruitment in the company's multi-center Phase 2a clinical study of PS433540. The objective of the Phase 2a randomized, double-blind, placebo-controlled, parallel-group study is to evaluate the efficacy and safety of 200 and 500 mg of PS433540 in subjects with Stage I and Stage II hypertension. The company expects to announce results from this Phase 2a study in the second quarter of 2008.
-- Pharmacopeia announced the nomination of a development compound from its internal CCR1 discovery program. The compound, known as PS031291, is a potent and highly selective antagonist at the CCR1 chemokine receptor, which has been implicated as playing a significant role in multiple inflammatory and autoimmune disease processes. Pharmacopeia believes PS031291 may possess significant potential in the oral treatment of multiple myeloma and various inflammatory diseases including rheumatoid arthritis.
"During 2007, Pharmacopeia's therapeutic pipeline grew and matured more than at any time in the past. Phase 2a DARA results that are expected in the second quarter have the potential to add important value to the program," stated Les Browne, Ph.D., Pharmacopeia's President and Chief Executive Officer. "Also during 2007, our alliances with GlaxoSmithKline, Schering-Plough and Bristol-Myers Squibb each achieved significant milestones. In 2008, we anticipate that successes with internal programs and external alliances will continue to build our therapeutics portfolio."
FOURTH QUARTER & YEAR END 2007 FINANCIAL RESULTS
At December 31, 2007, Pharmacopeia had cash, cash equivalents and marketable securities of $71.3 million, exceeding the company's year-end guidance of between $65 million and $70 million. Net cash used in operating activities for the year ended December 31, 2007 was $11.1 million, which included the receipt of an aggregate $20.0 million in up-front payments in connection with Pharmacopeia's alliances with Wyeth and Organon and $5.0 million in additional research funding in connection with Pharmacopeia's alliance with GSK. Absent the receipt of $25.0 million from these collaborators, Pharmacopeia's net cash used in operating activities in 2007 would have been approximately $36.1 million.
Pharmacopeia reported a net loss of $19.3 million, or ($0.65) per share, for the quarter ended December 31, 2007. The company recorded a net loss of $8.2 million, or ($0.41) per share, for the same quarter in 2006. For the year ended December 31, 2007, Pharmacopeia recorded a net loss of $47.9 million, or ($1.79) per share. Pharmacopeia recorded a net loss of $27.8 million, or ($1.69) per share for the 2006 year.
Additional financial highlights for the quarter and year ended December 31, 2007 were as follows.
Pharmacopeia's net revenue was $5.0 million for the quarter ended December 31, 2007, compared to $3.3 million for the quarter ended December 31, 2006, an increase of 53%. The increase in net revenue for the three months ended December 31, 2007 was primarily due to increased research revenue from the company's alliances with Wyeth, Organon, GSK and BMS. For the year ended December 31, 2007, net revenue was $21.4 million, compared to $16.9 million for the full year in 2006, an increase of 26%. The increase in net revenue for the year ended December 31, 2007 was largely due to increased research revenue from the company's alliances with Wyeth, GSK, Cephalon, and BMS.
Collaborative research and development expense increased 86% to $7.0 million in the three months ended December 31, 2007, compared to $3.8 million in the three months ended December 31, 2006. This increase was due to increased resources allocated to Pharmacopeia's alliance with GSK, coupled with resources expended on the company's JAK3 program. The expense for the JAK3 program has been primarily classified as collaborative research and development expense since the company partnered the program with Wyeth in December 2006. Prior to 2007, resources expended on the company's JAK3 program were classified as proprietary research and development expense. For the year ended December 31, 2007, collaborative research and development expense increased 75% to $23.7 million, compared to $13.6 million for the same period in 2006. This increase was due to increased resources allocated to Pharmacopeia's alliances with Cephalon, GSK and Wyeth.
The company incurred proprietary research and development expense of $17.3 million in the quarter ended December 31, 2007, compared to $6.0 million in the same period in 2006, an increase of 190%. For the year ended December 31, 2007, proprietary research and development expense increased to $39.3 million, compared to $23.5 million for the same period in 2006, an increase of 67%. The increase in the quarter and year ended December 31, 2007 was largely due to the company's licensing of the SARM program from BMS, for which the company recorded a non-cash charge of $9.2 million. Exclusive of this charge, proprietary research and development expense increased 36% and 28% in the quarter and year ended December 31, 2007, respectively. These increases were primarily due to costs related to clinical development studies for the DARA program and resources expended on the CCR1 program.
General and administrative expense was $3.0 million for the quarter ended December 31, 2007, compared to $2.8 million for the same period in 2006, an increase of 4%. General and administrative expense was $11.0 million for the year ended December 31, 2007, compared to $9.8 million for the same period in 2006, an increase of 12%. The increase in general and administrative expense was due to increased consulting, recruiting and legal costs.
2008 GOALS
In 2008, Pharmacopeia will continue to work diligently to achieve its goal of increasing shareholder value by executing a strategy that focuses on progressing the company's clinical programs and continues to leverage its drug discovery capabilities. In 2008 consistent with this strategy Pharmacopeia plans to:
-- Progress the DARA program, including the completion of a second Phase 2
clinical trial for PS433540 in hypertensive patients;
-- Progress the SARM program, including the initiation of a Phase 1
multiple ascending dose study for PS178990;
-- Advance the CCR1 development program toward filing an Investigational
New Drug application;
-- Advance Pharmacopeia's collaborative alliances; and
-- End the year with cash, cash equivalents and marketable securities in
excess of $55 million.
Further details regarding Pharmacopeia's fourth quarter and year-end results will be presented in a conference call today, February 28, 2008 at 5:00 p.m. Eastern Time. Dr. Les Browne, President and Chief Executive Officer and Mr. Brian M. Posner, Executive Vice President and Chief Financial Officer will host the call. Forward-looking and material information may be discussed on this conference call.
Date: February 28, 2008
Time: 5:00 p.m. EST
U.S./Canadian Participants: (877) 627-6590
International Participants: (719) 325-4938
Confirmation Code: 2681841
Name of Conference: Pharmacopeia's Fourth Quarter and Full Year 2007 Financial
Results
Webcast information can be accessed by visiting pharmacopeia.com
A replay of the conference call, can be accessed by dialing toll-free (888) 203-1112 in the U.S. or (719) 457-0820 outside the U.S. The access code for the replay is 2681841. Replay of the webcast will also be accessible on Pharmacopeia's website on the "Investors" page at pharmacopeia.com. The replays will be available for two weeks. |
