ISELIN, N.J., July 30, 2012 /PRNewswire/ -- Pharmos Corporation (OTCQB: PARS) today reported financial results for the second quarter and six-month period ended June 30, 2012. These results are included in the Company's Quarterly Report on Form 10-Q which has been filed with the SEC.
In May the Company issued a press release announcing the successful completion of a proof-of concept trial of levotofisopam for the treatment of gout. The trial was open label and 100% of the subjects were responders bringing their serum acid levels below 6mg/dL and 54% achieved serum uric acid levels below 4mg/dL. The Company has very limited financial resources and therefore needs to secure a partnership or raise additional capital to further develop levotofisopam.
Liquidity and Cash position
The Company's condensed consolidated financial statements have been prepared assuming it will continue as a going concern. At June 30, 2012, the Company had approximately $0.5 million in cash and cash equivalents. Management believes that the current cash and cash equivalents will be sufficient to support their currently planned continuing operations through October 2012. Currently the Company spends approximately $100,000 a month on continuing operating expenses. The Company has a debenture of $1 million due to be repaid on November 1, 2012 which the Company will be unable to satisfy unless it achieves a collaboration with a pharmaceutical partner or raises additional capital to advance its lead compounds, levotofisopam, for the treatment of Gout, and dextofisopam, for the treatment of IBS.
Second Quarter Ended June 30, 2012
The Company recorded a net loss of $0.4 million, or ($0.01) per share, for the second quarter 2012 compared to a net loss of $0.5 million, or ($0.01) per share, in the second quarter 2011.
Research & development expenses for the second quarter decreased by $99,613, or 46%, from $214,470 in 2011 to $114,857 in 2012. The primary areas include a $34,000 reduction in clinical study fees and a $66,000 reduction in consultant and professional fees. Clinical study fees decreased as the Gout trial concluded in April 2012 and fees were incurred on 13 completed patients. In 2011 clinical study fees were higher due to costs related to conducting a non-human primate toxicology study. Consulting and professional fees have decreased as the Company filed the IND for the Gout trial in 2011 while in 2012 there were normal expenses in this area.
General and administrative expenses for the second quarter of 2012 decreased by $21,664, or 8%, from $259,415 in 2011 to $237,751 in 2012. The primary reductions were a $7,000 reduction in salaries and benefits and a $15,000 reduction in various other areas. The decrease in payroll costs in 2012 reflects lower stock compensation. There was also a reduction of various facility related expenses as the Company continued to reduce and manage overhead.
Six-months Ended June 30, 2012
For the six months ended June 30, 2012, Pharmos recorded a net loss of $1.0 million, or ($0.02) per share compared to a net loss of $1.1 million, or ($0.02) per share for the six months ended June 30, 2011.
Research & development expenses for the first half of 2012 decreased by $90,733, or 18%, from $496,254 in 2011 to $405,521 in 2012. The primary areas include an $115,000 increase in clinical study fees which were offset by a $204,000 reduction in consultant and professional fees and a $2,000 reduction in various other areas. Clinical study fees increased as the Gout trial commenced in January 2012 and fees were incurred on 13 completed patients. Consulting and professional fees have decreased as the Company filed the IND for the Gout trial in 2011 while in 2012 there were normal expenses in this area.
General and administrative expenses for the first half of 2012 decreased by $55,952, or 10%, from $553,760 in 2011 to $497,808 in 2012. The primary reductions were a $15,000 reduction in consultant and professional fees, a $13,000 reduction in salaries and benefits and a $28,000 reduction in various other areas. Professional fees have decreased as there were reduced legal fees incurred. The decrease in payroll costs in 2012 reflects lower stock compensation. There was also a reduction of various facility related expenses as the Company continued to reduce and manage overhead.
About Pharmos Corporation
Pharmos discovers and develops novel therapeutics to treat a range of metabolic and nervous system disorders, including gout, disorders of the brain-gut axis (e.g., Irritable Bowel Syndrome), pain/inflammation, and autoimmune disorders. The Company's lead products are the two enantiomers of tofisopam. S-tofisopam (levotofisopam) is being investigated for the treatment of gout. R-tofisopam (dextofisopam) has been developed through Phase 2b for the treatment of IBS. There is a large unmet need for therapeutic alternatives for the treatment of IBS, a chronic and often debilitating condition affecting roughly 10-15% of U.S. adults, primarily women. Pharmos is seeking partnerships to further develop dextofisopam for IBS and to advance the development of levotofisopam for gout. The Company also has a proprietary technology platform centering on discovery and development of synthetic cannabinoid compounds, with a focus on CB2 receptor-selective agonists. Various CB2-selective compounds from Pharmos' pipeline have successfully completed preclinical studies targeting pain, multiple sclerosis, rheumatoid arthritis, inflammatory bowel disease, and other disorders. These compounds are available for licensing/partnering.
Safe Harbor Statement
Statements made in this press release related to the business outlook and future financial performance of Pharmos, to the prospective market penetration of its drug products, to the development and commercialization of its pipeline products and to its expectations in connection with any future event, condition, performance or other matter, are forward-looking and are made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties that may cause results to differ materially from those set forth in these statements. Additional economic, competitive, governmental, technological, marketing and other factors identified in Pharmos' filings with the Securities and Exchange Commission could affect such results.