MONTREAL, Aug. 14 /PRNewswire-FirstCall/ - AKELA Pharma Inc., , a drug development company focused on developing therapies for the inhalation, pain and CNS markets, today announced financial results for the second quarter of fiscal 2007 ended June 30, 2007.
Akela’s results of operations for the three and six month period ended June 30, 2007 include the operations of PharmaForm since the date of its acquisition on January 25, 2007. Akela’s consolidated net loss for the second quarter of 2007 was $7.1 million compared to $5.8 million for the segmented Pharma results for the same 2006 period. As of January 1, 2007 our functional and reporting currency is now the US dollar.
“The second quarter and first half of fiscal 2007 were marked by some of the most significant corporate events to ever take place at Akela. We have signed a European Union licensing agreement with Janssen Pharmaceutica NV. for our lead product Fentanyl TAIFUN(R), representing the best possible external validation for our product, platform and technology. We have also continued to deliver strong and statistically significant clinical data from our product development programs such as AKELA’s GHRH which has clinically demonstrated efficacy beyond our expectations. Based on the accomplishments of the first half of 2007, we strongly believe the second half of 2007 will prove to be as successful as the first one. " said Dr Halvor Jaeger, Chief Executive Officer of Akela Pharma Inc.
Other Second Quarter Financial Highlights - Total consolidated revenues for the second quarter of 2007 were $3.4 million, including $0.6 million in co-development fees and other revenue and $2.8 million of contract services. Total consolidated revenues for the first 6 months of 2007 were $4.8 million, including $1.0 million in co-development fees and other revenue and $4.2 million of contract services. - Consolidated net loss for the second quarter of 2007 was $7.1 million or ($0.09) per share. Consolidated net loss year-to-date is $15.2 million or ($0.19) per share. 2007 Second Quarter Operational Highlights - Akela announced the signing of a licensing agreement with Janssen Pharmaceutica NV for its lead product, Fentanyl TAIFUN(R) for the European Union, Eastern Europe, Russia, the Middle East and Africa. A signing fee of $10.8 million was received. - Akela announced the first patient enrollment for the extension arm of its Fentanyl TAIFUN(R) Phase IIb study. - Akela announced the change of its corporate name from LAB International Inc. following the approval of a special resolution at its Annual and Special Shareholders meeting. Financial Results
The year-over-year increase in the net loss was due to a higher rate of spending on research and development activities and selling, general and administrative expenses.
Consolidated SG&A expenses totaled $4.1 million for the second quarter of 2007 and $6.5 million year-to-date compared to $2.3 million and $4.1 million for the same respective 2006 periods.
R&D costs for the second quarter of 2007 were $4.6 million and $9.6 million year-to-date compared to $2.5 million and $4.8 million for the same respective 2006 periods. The year-to-date amount includes $1.6 million of severance expense and early termination charges relating to the exit of leased premises in Finland. The increase in spending is primarily attributable to the costs associated with the advancement and finalization of the Fentanyl TAIFUN(R) Phase II trial program and the development of our product candidates.
The consolidated net loss for the second quarter of 2007 was $7.1 million, or ($0.09) per share and $15.2 million or ($0.19) per share year-to-date, compared with a consolidated net loss for the former Pharma segment of $5.8 million and $11.1 million respectively.
The Company had cash and cash equivalents as of June 30, 2007 of $12.1 million. This does not include an additional $10.8 million received in July 2007 from the signing of a licensing and development agreement with Janssen Pharmaceutica NV for Fentanyl TAIFUN(R). This also compares with $35.3 million as of December 31, 2006.
About Akela Pharma Inc.
Akela Pharma is an integrated drug development company focused on developing therapies for the growing multi-billion dollar inhalation, pain and CNS markets. Its lead product, for the treatment of breakthrough cancer pain, is a fast-acting Fentanyl formulation delivered using the Company’s TAIFUN(R) dry powder inhaler platform. Its pipeline also includes therapeutics for asthma, COPD, growth hormone deficiencies and abuse deterrent formulations for controlled substances.
Akela’s common shares trade on The Toronto Stock Exchange (“TSX”) under the symbol “AKL” with 82.3 million shares outstanding.
This news release contains certain forward-looking statements that reflect the current views and/or expectations of AKELA Pharma Inc. with respect to its performance, business and future events. Such statements are subject to a number of risks, uncertainties and assumptions. Actual results and events may vary significantly.
AKELA PHARMA, INC. (formerly LAB International Inc.) Consolidated Balance Sheets (Unaudited) June 30, 2007, with comparative figures as at December 31, 2006 (in thousands of US dollars) ------------------------------------------------------------------------ ------------------------------------------------------------------------ June 30, December 31, 2007 2006 ------------------------------------------------------------------------ Assets Current assets: Cash and cash equivalents $ 12,120 $ 35,304 Accounts receivable 13,689 1,347 Prepaid expenses 776 712 ---------------------------------------------------------------------- 26,585 37,363 Restricted cash 600 - Property and equipment 3,568 397 Intangible assets 14,874 8,015 Goodwill 2,280 - Deferred corporate transaction costs 2,231 828 ------------------------------------------------------------------------ $ 50,138 $ 46,603 ------------------------------------------------------------------------ ------------------------------------------------------------------------ Liabilities and Shareholders’ Equity Current liabilities: Accounts payable and accrued liabilities $ 6,611 $ 4,886 Deferred revenue 1,477 1,606 Current portion of long-term debt 323 1,456 ---------------------------------------------------------------------- 8,411 7,948 Deferred revenue 10,966 - Long-term debt 6,307 4,248 Future income taxes 1,153 1,204 Shareholders’ equity: Share capital 54,189 49,758 Warrants 364 366 Additional paid-in capital 6,780 6,281 Accumulated other comprehensive income 3,458 3,458 Deficit (41,490) (26,660) ---------------------------------------------------------------------- 23,301 33,203 Commitments and contingencies (note 13) ------------------------------------------------------------------------ $ 50,138 $ 46,603 ------------------------------------------------------------------------ ------------------------------------------------------------------------ See accompanying notes to unaudited consolidated financial statements. AKELA PHARMA, INC. (formerly LAB International Inc.) Consolidated Statements of Comprehensive Earnings (Unaudited) June 30, 2007, with comparative figures as at December 31, 2006 (in thousands of US dollars) Three-months Six-months ended June 30, ended June 30, ------------------------ ---------------------- 2007 2006 2007 2006 ------------------------------------------------------------------------ Revenues $ 3,409 $ 10,639 $ 4,783 $ 20,347 Expenses: Direct costs 1,448 6,354 2,241 12,094 Selling, general and administrative 4,102 4,484 6,538 8,127 Research and development 4,331 2,506 9,374 4,842 Stock-based compensation 379 204 497 399 Amortization of property and equipment 245 756 409 1,442 Amortization of intangible assets 700 364 1,234 705 Interest on long-term debt and loss on settlement of convertible debenture 50 836 97 1,455 Foreign exchange (1,248) 19 (835) 343 ------------------------------------------------------------------------ 10,007 15,523 19,555 29,407 ------------------------------------------------------------------------ Loss before income taxes (6,598) (4,884) (14,772) (9,060) Recovery of (provision for) income taxes: Current (119) (733) (138) (1,062) Future (6) 810 80 951 ---------------------------------------------------------------------- (125) 77 (58) (111) ------------------------------------------------------------------------ Net loss $ (6,723) $ (4,807) $ (14,830) $ (9,171) ------------------------------------------------------------------------ ------------------------------------------------------------------------ Basic and diluted net loss per share $ (0.08) $ (0.07) $ (0.18) $ (0.13) ------------------------------------------------------------------------ ------------------------------------------------------------------------ Basic and diluted weighted average number of shares outstanding 82,340,563 72,085,027 81,721,540 70,535,677 ------------------------------------------------------------------------ ------------------------------------------------------------------------ See accompanying notes to unaudited consolidated financial statements.
AKELA PHARMA INC.
CONTACT: Frederic Dumais, Vice-President, Investor Relations, (514)315-3330 ext. 106, Fax: (514) 315-3325; Tina Posterli, (U.S. Media), (917)322-2565, tposterli@rxir.com; www.akelapharma.com
