QUEBEC CITY, Aug. 11 /PRNewswire-FirstCall/ - AEterna Zentaris Inc. today reported financial and operating results for the second quarter ended June 30, 2006.
“During the second quarter, we made great strides in advancing our products through the pipeline at all stages as exemplified by Cetrotide(R)'s marketing approval in Japan, our successful meeting with the FDA leading to the upcoming filing of an IND to move forward into Phase 3 clinical development of cetrorelix in benign prostatic hyperplasia (BPH), as well as the disclosure of positive clinical results in cancer with perifosine and AN-152. Most recently, we disclosed positive Phase 2 results for ozarelix in prostate cancer which will enable us to pursue further clinical trials in this indication. Additionally, we signed a license and collaboration agreement in Japan with Nippon Kayaku for ozarelix in oncology,” said Gilles Gagnon, AEterna Zentaris’ President and Chief Executive Officer. “We are very pleased with these achievements which are an integral part of the Company’s strategy designed to build a strong and innovative pipeline focused on oncology and endocrinology. We now look forward to continued success as we aggressively advance our lead compounds.”
Key Developments for the Quarter Ended June 30, 2006 - Market approval for Cetrotide(R) (cetrorelix) in Japan for in vitro fertilization - Cetrotide(R) (cetrorelix) will be manufactured and marketed in Japan by AEterna Zentaris’ partners Nippon Kayaku Co., Ltd. and Shionogi & Co., Ltd. with an expected launch in Japan by year-end; - Green light from FDA to file IND to move forward into Phase 3 program with cetrorelix in BPH - The FDA reviewed the safety and efficacy data from an extensive Phase 2 program with cetrorelix for the treatment of benign prostatic hyperplasia (BPH). AEterna Zentaris plans to submit an Investigational New Drug (IND) application to the FDA by year-end for the initiation of a Phase 3 program for cetrorelix in BPH; - Positive interim Phase 2 data of perifosine in advanced renal cell carcinoma - Interim results of a multi-center Phase 2 trial by the Company’s partner, Keryx Biopharmaceuticals, showed a 43% partial response rate; - Positive data from ongoing Phase 1 trial with AN-152 for gynaecological and breast cancers presented at ASCO - Phase 1 results for AEterna Zentaris’ cytotoxic conjugate AN-152 in patients with gynaecological and breast cancers showed that the compound has a good safety profile and no dose-limiting toxicities reached so far in the selected dose levels; - Positive in vivo data on ZEN-019 (oral LHRH antagonist peptidomimetic) presented at ENDO 2006 - ZEN-019 demonstrated in vivo activity by suppressing plasma testosterone levels. In vivo data showed that using ZEN-019 with a single, oral administration (20 mg/kg) in rats, led to efficient and revocable suppression of plasma testosterone levels for up to 12 hours. Furthermore, a repeat of the dosing of ZEN-019 increased the suppression time without accumulation in the plasma. Financial Results for the Quarter Ended June 30, 2006
Consolidated revenues for the quarter ended June 30, 2006 totalled $83.4 million compared to $60.1 million for the same period in 2005.
Consolidated Research and Development expenses, net of tax credits and grants increased to $7.4 million for the quarter ended June 30, 2006 compared to $6.1 million for the same period in 2005.
Consolidated selling, general and administrative expenses totalled $15.5 million for the quarter ended June 30, 2006 compared to $10 million for the same period in 2005.
Consolidated net loss for the quarter ended June 30, 2006 was $1.6 million or $0.03 per basic and diluted share compared to consolidated net earnings of $13.3 million or $0.28 per diluted share for the same period in 2005. Without taking into account a non-cash and non-recurring gain on dilution of investments of $16.4 million recorded last year following the Company’s subsidiary Atrium Biotechnologies’ Initital Public Offering (IPO), AEterna Zentaris would have recorded a consolidated net loss of $3.1 million or $0.07 per basic and diluted share in the second quarter of 2005, compared to the $1.6 million or $0.03 per basic and diluted share consolidated net loss registered for the second quarter 2006. This $1.5 million decrease is mainly attributable to increased net earnings of $1.1 million from Atrium Biotechnologies and to the reduction of the operating loss from AEterna Zentaris’ Biopharmaceutical segment.
Cash, cash equivalents and short-term investments reached $47 million for the quarter ended June 30, 2006 compared to $52.7 million as of December 31, 2005. More than $27 million was dedicated to the Company’s Biopharmaceutical segment as of June 30, 2006.
Dennis Turpin, Vice President and Chief Financial Officer of AEterna Zentaris, commented, “As we continue to successfully implement our strategy, we are pleased to maintain a sound financial position, including the ability to leverage our assets as we continue to execute our plan and aggressively advance our pipeline. We are financially poised to continue our investment in R&D, as well as support our growing business.”
Developments Subsequent to Quarter End - Positive Phase 2 results for ozarelix in prostate cancer - The study achieved its primary end-point of defining a tolerable dosage regimen of ozarelix that would ensure continuous suppression of testosterone at castration level (< 0.5 ng/ml) for a three-month test period. An important secondary efficacy end-point of the study aimed at assessing tumour response as determined by a 50% or greater reduction of serum PSA levels, compared to baseline, was also achieved. - Licence and collaboration agreement with Nippon Kayaku for ozarelix in oncology - AEterna Zentaris granted Nippon Kayaku an exclusive license to develop and market ozarelix for all potential oncological indications in Japan. Conference Call Information
Management will be hosting a conference call for the investment community beginning at 11:00 a.m. Eastern Time today, Friday, August 11, to discuss 2006 second quarter financial and operating results, followed by a question and answer session.
To participate in the live conference call by telephone, please dial 800-257-3401. Individuals interested in listening to the conference call on the Internet may do so by visiting www.aeternazentaris.com. A replay will be available on the Company’s Web site for 30 days.
About AEterna Zentaris Inc.
AEterna Zentaris Inc. is a growing global biopharmaceutical company focused on oncology and endocrine therapy with proven expertise in drug discovery, development and commercialization.
AEterna Zentaris also owns 48.26% of the equity of Atrium Biotechnologies Inc. and 64.69% of its voting rights. Atrium is a developer, manufacturer and marketer of science-based products for the cosmetics, pharmaceutical, chemical and nutritional industries.
News releases and additional information are available at www.aeternazentaris.com.
Forward-Looking Statements
This press release contains forward-looking statements made pursuant to the safe harbor provisions of the U.S. Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which could cause the Company’s actual results to differ materially from those in the forward-looking statements. Such risks and uncertainties include, among others, the availability of funds and resources to pursue R&D projects, the successful and timely completion of clinical studies, the ability of the Company to take advantage of business opportunities in the pharmaceutical industry, uncertainties related to the regulatory process and general changes in economic conditions. Investors should consult the Company’s quarterly and annual filings with the Canadian and U.S. securities commissions for additional information on risks and uncertainties relating to the forward-looking statements. Investors are cautioned not to rely on these forward-looking statements. The Company does not undertake to update these forward-looking statements.
Attachment: Financial summary (In thousands of US dollars, except share and per share data) Quarters ended Six months ended CONSOLIDATED RESULTS June 30, June 30, Unaudited 2006 2005 2006 2005 ------------------------------------------------------------------------- ------------------------------------------------------------------------- $ $ $ $ Revenues 83,390 60,144 167,867 122,009 ------------------------------------------------------------------------- Operating expenses Cost of sales 52,619 38,564 109,815 75,727 Selling, general and administrative 15,517 10,014 29,084 19,949 R&D costs, net of tax credits and grants 7,380 6,099 14,281 12,545 Depreciation and amortization 2,478 2,011 4,859 3,829 ------------------------------------------------------------------------- 77,994 56,689 158,039 112,050 ------------------------------------------------------------------------- Earnings from operations 5,396 3,456 9,828 9,959 Interest income 455 426 875 732 Interest expense (2,004) (2,668) (5,227) (4,826) Foreign exchange gain (loss) (295) (155) (83) 53 ------------------------------------------------------------------------- Earnings before the following items 3,552 1,059 5,393 5,918 Current income taxes (2,395) (2,131) (4,391) (4,252) Future income taxes 630 (65) 1,819 (1,162) Gain (loss) on dilution of investments (81) 16,393 (135) 16,393 Non-controlling interest (3,268) (1,980) (6,828) (3,503) ------------------------------------------------------------------------- Net earnings (loss) for the period (1,562) 13,276 (4,142) 13,394 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Net earnings (loss) per share Basic (0.03) 0.29 (0.08) 0.29 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Diluted (0.03) 0.28 (0.08) 0.28 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Weighted average number of shares Basic 52,682,969 46,139,814 52,098,592 46,139,814 Diluted 53,261,928 46,448,125 52,651,808 46,506,728 Issued and outstanding shares 53,160,970 Biopharmaceutical Segment - Selected Financial Information (In thousands of US dollars) Quarters ended Six months ended Unaudited June 30, June 30, 2006 2005 2006 2005 ------------------------------------------------------------------------- ------------------------------------------------------------------------- $ $ $ $ Revenues Sales and royalties 5,228 5,381 11,803 12,279 License fees 4,155 4,779 6,328 11,628 ------------------------------------------------------------------------- 9,383 10,160 18,131 23,907 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Cost of sales 1,404 1,835 4,045 4,169 Selling and administrative 4,515 3,907 8,360 7,285 R&D expense, net of tax credits and grants 7,262 6,081 14,066 12,431 Depreciation and amortization 1,653 1,708 3,216 3,258 ------------------------------------------------------------------------- 14,834 13,531 29,687 27,143 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Loss from operations (5,451) (3,371) (11,556) (3,236) ------------------------------------------------------------------------- ------------------------------------------------------------------------- Cash flows generated (used) by operating activities (3,518) 1,076 (7,042) 247 ------------------------------------------------------------------------- ------------------------------------------------------------------------- CONSOLIDATED BALANCE SHEET As at As at June December 30, 31, Unaudited 2006 2005 ------------------------------------------------------------------------- ------------------------------------------------------------------------- $ $ Cash and short-term investments 47,041 52,705 Other current assets 111,178 110,971 ------------------------- 158,219 163,676 Long-term assets 277,404 263,835 ------------------------- Total assets 435,623 427,511 ------------------------- ------------------------- Current liabilities 62,378 64,174 Long-term debt 100,706 135,743 Other long-term liabilities 54,423 53,532 Non-controlling interest 74,760 64,531 ------------------------- 292,267 317,980 Shareholders’ equity 143,356 109,531 ------------------------- Total liabilities and shareholders’ equity 435,623 427,511 ------------------------- -------------------------
AETERNA ZENTARIS INC. (FORMERLY/ANCIENNEMENT - LES LABORATOIRES AETERNA LABORATORIES INC.)
CONTACT: Media Relations: Paul Burroughs, (418) 652-8525 ext. 406,paul.burroughs@aeternazentaris.com; Investor Relations: Jenene Thomas,(418) 655-6420, (908) 996-3154, jenene.thomas@aeternazentaris.com
