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Enzon Pharmaceuticals, Inc. (ENZN) Reports First Quarter 2012 Results


5/2/2012 8:27:40 AM

PISCATAWAY, NJ--(Marketwire - May 02, 2012) - Enzon Pharmaceuticals, Inc. (NASDAQ: ENZN) today announced its financial results for the first quarter of 2012. Enzon reported a net loss of $1.1 million, or $0.02 diluted loss per share, for the first quarter of 2012 as compared to net income of $0.4 million, or $0.01 diluted earnings per share, for the first quarter of 2011. The results from the first quarter of 2011 included receipt of a $5.0 million milestone payment from the purchaser of the specialty pharmaceutical business resulting from the approval of a supplemental Biologic License Application (sBLA) for the manufacture of SS Oncaspar®.

Summary of Financial Results

Royalty Revenue

Royalty revenue for the three months ended March 31, 2012 was $10.3 million, as compared to $11.8 million for the three months ended March 31, 2011. Royalties on PEGINTRON®, marketed by Merck & Co., Inc., continued to comprise the majority of the Company's royalty revenue, and a reported decline in foreign sales of PEGINTRON was largely accountable for the decrease in royalty revenue.

Research and Development

The Company's pipeline research and development expenses were $6.9 million for the three months ended March 31, 2012, as compared to $10.5 million for the three months ended March 31, 2011. The pipeline consists of the following clinical programs: PEG-SN38 and mRNA antagonists targeting Hypoxia-Inducible Factor-1a (HIF-1a), Survivin and the Androgen Receptor (AR). In addition, the Company has other novel LNA targets in various stages of preclinical research. Clinical expenses for the first quarter of 2012 declined primarily due to a $2.1 million reduction in salaries and benefits expenses as a result of the restructuring implemented during the fourth quarter of 2011. In addition, Enzon completed enrollment in both of the Company's Phase II clinical trials of PEG-SN38, as well as Phase I clinical trials for HIF-1a and Survivin.

General and Administrative

General and administrative expenses decreased approximately 28% to $3.7 million for the three months ended March 31, 2012 from $5.1 million for the three months ended March 31, 2011. The decline in 2012 from 2011 was largely the result of several restructuring programs implemented over the past year, as well as the Company's on-going cost containment efforts.

Cash and Investments

Total cash reserves, which consist of cash, cash equivalents and marketable securities, were $318.7 million as of March 31, 2012, as compared to $323.3 million as of December 31, 2011. The decrease was primarily attributable to $3.75 million of outstanding notes payable repurchased during the first quarter of 2012.

About Enzon

Enzon Pharmaceuticals, Inc. is a biotechnology company dedicated to the research and development of innovative therapeutics for cancer patients with high unmet medical needs. Enzon's drug-development programs utilize two platforms -- Customized PEGylation Linker Technology (Customized Linker Technology®) and third-generation mRNA-targeting agents utilizing the Locked Nucleic Acid (LNA) technology. Enzon currently has four compounds in human clinical development and multiple novel mRNA antagonists in preclinical research. Enzon receives royalty revenues from licensing arrangements with other companies related to sales of products developed using its proprietary Customized Linker Technology. Further information about Enzon and this press release can be found on the Company's website at www.enzon.com.

Forward-Looking Statements

This press release contains, or may contain, forward-looking statements within the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release, other than statements that are purely historical, are forward-looking statements, which can be identified by the use of forward-looking terminology such as the words "believes," "expects," "may," "will," "should," "potential," "anticipates," "plans," or "intends" and similar expressions.

Such forward-looking statements are based upon management's present expectations, objectives, anticipation, plans, hopes, beliefs, intentions or strategies regarding the future and are subject to known and unknown risks and uncertainties that could cause actual results, events or developments to be materially different from those indicated in such forward-looking statements. A more detailed discussion of these and other factors that could affect results is contained in Enzon's filings with the U.S. Securities and Exchange Commission, including Enzon's Annual Report on Form 10-K for the year ended December 31, 2011. These factors should be considered carefully and readers are cautioned not to place undue reliance on such forward-looking statements. No assurance can be given that the future results covered by the forward-looking statements will be achieved. All information in this press release is as of the date of this press release and Enzon does not intend to update this information.

                                                                            
                                                                            
                Enzon Pharmaceuticals, Inc. and Subsidiaries                
      Condensed Consolidated Statements of Comprehensive (Loss) Income      
            (Unaudited; In thousands, except per share amounts)             
                                                                            
                                                      Three months ended    
                                                           March 31,        
                                                   ------------------------ 
                                                       2012         2011    
                                                   -----------  ----------- 
Revenues:                                                                   
  Royalties                                        $    10,321  $    11,762 
  Sale of in-process research and development                -        5,000 
  Contract research and development                        103        1,094 
  Miscellaneous income                                     177          166 
                                                   -----------  ----------- 
    Total Revenues                                      10,601       18,022 
                                                                            
Operating Expenses:                                                         
  Research and development - pipeline                    6,914       10,548 
  Research and development - specialty and                                  
   contracted services                                      85          647 
  General and administrative                             3,675        5,086 
  General and administrative - contracted services           -           58 
  Restructuring charges                                    (37)         359 
                                                   -----------  ----------- 
    Total Operating Expenses                            10,637       16,698 
                                                                            
                                                   -----------  ----------- 
      Operating (Loss) Income                              (36)       1,324 
                                                                            
Other Income (Expense):                                                     
  Investment income, net                                   478          459 
  Interest expense                                      (1,417)      (1,480)
  Other, net                                               (96)         128 
                                                   -----------  ----------- 
    Total Other Expense                                 (1,035)        (893)
                                                                            
                                                   -----------  ----------- 
Loss before income tax expense                          (1,071)         431 
Income tax expense                                           -            - 
                                                   -----------  ----------- 
                                                                            
      Net (Loss) Income                            $    (1,071) $       431 
                                                   ===========  =========== 
                                                                            
(Loss) earnings per common share - basic and                                
 diluted                                           $     (0.02) $      0.01 
                                                   ===========  =========== 
                                                                            
Weighted-average shares - basic                         48,293       58,002 
                                                   ===========  =========== 
                                                                            
Weighted-average shares - diluted                       48,293       58,736 
                                                   ===========  =========== 
                                                                            
Other Comprehensive Income (Loss):                                          
  Available-for-sale marketable securities:                                 
    Unrealized holding gains (losses) arising                               
     during period                                 $       537  $      (125)
    Reclassification adjustment for realized                                
     losses (gains) on sales included in net                                
     (loss) income                                          35          (22)
                                                   -----------  ----------- 
      Total Other Comprehensive Income (Loss)              572         (147)
                                                   -----------  ----------- 
                                                                            
      Comprehensive (Loss) Income                  $      (499) $       284 
                                                   ===========  =========== 
                                                                            
                                                                            
                                                                            
                                                                            
                Enzon Pharmaceuticals, Inc. and Subsidiaries                
                    Condensed Consolidated Balance Sheets                   
                          (Unaudited; In thousands)                         
                                                                            
                                                     March 31,  December 31,
                                                       2012         2011    
                                                   ------------ ------------
Assets                                                                      
Current assets:                                                             
  Cash and cash equivalents                        $     46,214 $    104,324
  Marketable securities                                  78,480       58,188
  Other current assets                                    2,456        2,749
                                                   ------------ ------------
    Total current assets                                127,150      165,261
                                                                            
Property and equipment, net                              15,506       16,802
Marketable securities                                   194,038      160,779
Other assets                                                252          367
                                                   ------------ ------------
                                                                            
      Total Assets                                 $    336,946 $    343,209
                                                   ============ ============
                                                                            
Liabilities and Stockholders' Equity                                        
Current liabilities:                                                        
  Accounts payable                                 $      1,898 $      1,572
  Accrued expenses and other current liabilities         11,072       13,692
                                                   ------------ ------------
    Total current liabilities                            12,970       15,264
Notes payable                                           125,749      129,499
Other liabilities                                         1,081        1,265
                                                   ------------ ------------
      Total Liabilities                            $    139,800 $    146,028
                                                                            
      Total Stockholders' Equity                   $    197,146 $    197,181
                                                   ------------ ------------
                                                                            
      Total Liabilities and Stockholders' Equity   $    336,946 $    343,209
                                                   ============ ============

Investor Contact:
Andrea Rabney
Argot Partners
212.600.1902
Email Contact

Media Contact:
Meghan Feeks
Argot Partners
212.600.1902
Email Contact


Read at BioSpace.com

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