>>Progenics Pharmaceuticals Reports Second Quarter 2008 Results
Friday August 8, 7:00 am ET
TARRYTOWN, N.Y.--(BUSINESS WIRE)--Progenics Pharmaceuticals, Inc. (Nasdaq: PGNX - News) today announced its results of operations for the second quarter and first half of 2008.
Revenues for the second quarter ended June 30, 2008 totaled $28.6 million compared to $25.5 million for the same quarter in 2007. For the first half of 2008, Progenics reported revenues of $43.3 million compared to $43.1 million for the comparable period in 2007. Revenues primarily reflect reimbursement by the Company’s collaborator, Wyeth, for development work performed by the Company under its methylnaltrexone collaboration ($9.0 million and $9.0 million for the three months ended June 30, 2008 and 2007, respectively, and $17.8 million and $19.5 million for the six months ended June 30, 2008 and 2007, respectively), and recognition of a portion of the $60.0 million upfront payment received from Wyeth in December 2005 ($2.8 million and $4.9 million for the three months ended June 30, 2008 and 2007, respectively, and $6.0 million and $9.9 million for the six months ended June 30, 2008 and 2007, respectively).
In the second quarter of 2008, Progenics earned a $15.0 million milestone payment for U.S. Food and Drug Administration (FDA) approval of subcutaneous RELISTOR™. In May 2007, the Company had earned $9.0 million in milestone payments related to the acceptance for review of applications submitted for marketing approval of a subcutaneous formulation of RELISTOR in the U.S. and European Union (E.U.).
Progenics also earned $321,000 of royalties based on net sales of RELISTOR which commenced June 2008. Of this amount, $42,000 was recognized as royalty income and $279,000 was deferred and will be recognized as royalty income through 2009.
Progenics also earned revenue from the Company’s government grants and contract related to its proprietary programs in virology and oncology ($1.7 million for the three months ended June 30, 2008 compared to $2.5 million in the second quarter of 2007). For the six months ended June 30, 2008, government grants and contract totaled $4.3 million compared to $4.6 million in the comparable period in 2007.
Expenses for the second quarter of 2008 were $32.5 million, compared to $29.6 million for the second quarter of 2007. For the six months ended June 30, 2008, expenses totaled $64.7 million, compared to $59.5 million for the same period of 2007. Research and development expenses, including license fees – research and development and royalty expense, increased $1.7 million in the second quarter of 2008 compared to the second quarter of 2007, and increased $2.4 million in the first half of 2008 compared to the first half of 2007. The increases in these expenses resulted primarily from an increase in clinical trials activity related to the Company’s proprietary development programs in virology and oncology, and an increase in headcount. General and administrative expenses also increased for the three months and six months ended June 30, 2008, due primarily to an increase in headcount.
The second quarter net loss was $2.4 million, approximately the same as in the second quarter of 2007. Net loss per share was ($0.08) basic and diluted, compared to a net loss per share of ($0.09), basic and diluted, for the same period of 2007. The net loss for the first half of 2008 was $17.9 million, compared to a $12.8 million net loss for the same period in 2007. Net loss per share for the first half of 2008 was ($0.61), basic and diluted, compared to a net loss per share of ($0.48), basic and diluted, for the same period of 2007.
Progenics ended the second quarter with cash, cash equivalents and marketable securities of $150.6 million compared to $170.4 million at December 31, 2007.
“We are especially pleased to report that for the first time in our Company’s history we earned royalties of $321,000 on June 2008 sales of our first commercial product, RELISTOR,” said Paul J. Maddon, M.D., Ph.D., Founder, Chief Executive Officer and Chief Science Officer, Progenics Pharmaceuticals, Inc. “The 15% royalty on this quarter’s RELISTOR sales represents the lowest tier of royalties payable to us under our collaboration agreement with Wyeth. Royalty rates can range up to 30% of U.S. and 25% of foreign net sales at the highest sales levels. Royalty rates will increase on incremental sales as net sales in a calendar year exceed specified levels.”
Oral RELISTOR
Oral RELISTOR is an investigational drug being developed for the treatment of opioid-induced constipation (OIC). Two proprietary oral formulations of RELISTOR were tested in separate four-week, double-blind, randomized, placebo-controlled phase 2 trials each consisting of approximately 120 patients with chronic, non-malignant pain who were receiving opioids for pain management.
In comparing the activity and tolerability of these oral formulations of RELISTOR, both were generally well tolerated; however, one formulation was identified as having a more favorable clinical profile, while the other did not demonstrate sufficient clinical activity to warrant its continued study.
As previously announced on May 22, 2008, the formulation with the more favorable clinical profile demonstrated statistically significant results after once daily dosing, as assessed by the occurrence of spontaneous bowel movements and other efficacy measures. Further improvement upon this oral formulation through clinical optimization studies will begin in the coming months, with next steps in the development plan for oral RELISTOR to be decided in early 2009.
Developments / Highlights for the Second Quarter of 2008
On April 24th, Wyeth and Progenics received FDA approval of RELISTOR (methylnaltrexone bromide) subcutaneous injection for the treatment of opioid-induced constipation in patients with advanced illness who are receiving palliative care, when response to laxative therapy has not been sufficient. On the same day, the Companies also announced they received a Positive Opinion for RELISTOR (methylnaltrexone bromide) subcutaneous injection from the Committee for Medicinal Products for Human Use (CHMP), the scientific committee of the European Medicines Agency (EMEA). On July 3rd, Wyeth and Progenics announced receipt of marketing approval for RELISTOR (methylnaltrexone bromide) subcutaneous injection from the European Commission. RELISTOR was approved in the 27 E.U. member states as well as Iceland, Norway and Liechtenstein for the treatment of OIC in advanced illness patients who are receiving palliative care when response to usual laxative therapy has not been sufficient. RELISTOR is the first approved treatment for OIC in the E.U.
FDA approval of RELISTOR for subcutaneous use triggered a $15.0 million milestone payment from Wyeth to Progenics. Progenics’ Board of Directors approved a share repurchase program to acquire up to $15.0 million of its outstanding common shares, funding for which will come from the milestone payment. As of second quarter end, the Company had not repurchased any shares.
As previously announced, a Progenics phase 3 study examining the use of an intravenous formulation of RELISTOR for post-operative ileus (POI) in segmental colectomy surgery did not meet its primary or secondary end points, confirming earlier findings from a similar study conducted by Wyeth. Progenics and Wyeth are analyzing the results of both studies to determine whether and how to continue development of this formulation of RELISTOR for this indication.
The May 29th edition of the New England Journal of Medicine published results from a pivotal phase 3 trial of RELISTOR (methylnaltrexone bromide) subcutaneous injection. The phase 3 study demonstrated the efficacy of RELISTOR for use in advanced-illness patients with opioid-induced constipation. RELISTOR is now approved for marketing worldwide in over 30 countries.<<
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With the launch occurring in June, analysts clearly did not have a clue as to modeling revenues. Estimates ranged from 15 to 35 million, with the middle being 29.5. That PGNX only missed revenues by one million is meaningless, and it hit earnings expectations. But the stock has sold off a bit on the news. Buying op, methinks.
Cheers, Tuck |
