SOPHIA ANTIPOLIS, FRANCE--(Marketwire - May 13, 2009) -
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NicOx S.A. (NYSE Euronext Paris: COX) today reported financial results for the first three months of 2009 and provided an overview of the pre- commercialization activities for naproxcinod, a Cyclooxygenase-Inhibiting Nitric Oxide-Donating (CINOD) anti-inflammatory agent, in the pre- registration phase for the treatment of the signs and symptoms of osteoarthritis.
Eric Castaldi, Chief Financial Officer of NicOx, declared: “In the first quarter of 2009, we have continued to make good progress towards our two key goals of filing an NDA for naproxcinod with the FDA and transforming NicOx into a self-sustainable biopharmaceutical company. The new analyses of the phase 3 data presented at the annual meetings of the American College of Cardiology and the American Society of Hypertension further highlight naproxcinod’s potential clinical advantages and have been supportive to our on-going partnering discussions.”
Business Overview for the first quarter of 2009
- In the first three months of 2009, NicOx’ primary business focus has transitioned from the clinical development to the pre-commercialization and business development activities for naproxcinod. In parallel, NicOx is continuing to work on the preparation of the New Drug Application (NDA) file for naproxcinod.
- In late March, new analyses of the phase 3 data for naproxcinod were presented at the American College of Cardiology (ACC) Annual Meeting in Orlando, Florida. The presentation focused on blood pressure data for naproxcinod in osteoarthritis patients using antihypertensive therapies and included detailed assessments of the systolic blood pressure (SBP) changes from baseline in the overall population and in certain hypertensive sub- groups.
- During the quarter, NicOx announced the start of clinical development for NCX 6560, a novel, nitric oxide-donating compound which could become an improved treatment for serious cardiovascular diseases. The phase 1 proof- of-principal study is enrolling both healthy male volunteers and those with abnormally raised cholesterol and its initiation represents an important step in the development of NicOx’ product pipeline.
Post-first quarter events 2009
In late April, NicOx announced the purchase of Nitromed’s unlicensed patent estate covering nitric oxide-donating compounds, including a large number of new patents, with potential uses in NicOx’ core areas of inflammatory and cardio-metabolic disorders. Under the terms of the agreement, NicOx has paid Nitromed EUR 2 million at signature and will pay a further EUR 4 million upon NicOx fulfilling certain future business criteria. Following the acquisition, the Company holds by far the most comprehensive intellectual property portfolio in this area.
In early May, new analyses of the phase 3 data for naproxcinod were presented at the American Society of Hypertension (ASH) Annual Scientific Meeting in San Francisco, California, including data on all hypertensive patients which were presented for the first time.
“Turning to our financial position, we expect cash burn to decrease significantly in 2009, following the completion of naproxcinod’s phase 3 program,” continued Eric Castaldi, CFO of NicOx. “Current budgetary estimates suggest our cash resources will finance the activities of the Company until the end of 2010. This projection does not include any possible upfront and milestone payments that could arise from a potential commercialization agreement for naproxcinod. As a result we are looking forward to the remainder of 2009 with confidence.”
Financial summary of the first quarter of 2009:
Revenues were EUR 0.4 million in the first quarter of 2009, compared to EUR 1.4 million for the corresponding period of 2008. Revenues in the first quarter of 2009 were mainly due to research funding from Pfizer Inc.
Operating expenses were EUR 13.7 million in the first quarter of 2009, compared to EUR 17.5 million in the first quarter of 2008. The decline in operating expenses was due to the successful completion of the naproxcinod phase 3 clinical development program.
In the first quarter of 2009, NicOx recorded a total comprehensive loss for the period of EUR 11.2 million. This compares to EUR 13.0 million for the first quarter of 2008. On March 31, 2009, the Company had cash, cash equivalents and financial instruments of EUR 84.6 million, compared to EUR 104.7 million on December 31, 2008.
Review of the consolidated financial results for the three months ended March 31, 2009 and 2008
Revenues
NicOx’ revenues totaled EUR 0.4 million for the first three months ended March 31, 2009, compared to EUR 1.4 million for the three months ended March 31, 2008.
In the first quarter of 2009, NicOx only recognized the following amounts in revenues:
- EUR 0.04 million corresponding to the initial payment of EUR 5.0 million from Pfizer, as a technology exclusivity fee, following the March 2006 agreement that granted Pfizer rights to apply NicOx’ proprietary technology in a drug discovery research program covering the field of ophthalmology
- EUR 0.36 million corresponding to the funding of the research collaboration, pursuant to the above referenced agreement signed with Pfizer in March 2006
These amounts initially recorded as prepaid income were deferred over the estimated duration of NicOx’ involvement in the research program provided for under the terms of the agreement with Pfizer. The terms surrounding the duration of NicOx’ involvement in this program are revised periodically, if necessary.
Operating expenses
For the three months ended March 31, 2009, operating expenses amounted to EUR 13.7 million, compared to EUR 17.5 million for the three months ended March 31, 2008, of which 73% was attributable to research and development expenses and 27% attributable to selling and administrative expenses in the first quarter of 2009, compared to 87% and 13% respectively in the first quarter of 2008.
Research and development expenses were EUR 10.0 million during the first quarter of 2009, compared to EUR 15.1 million during the first quarter 2008 (including EUR 0.08 million allocated to cost of sales in 2009 and EUR 0.5 million in 2008). This decrease in research and development expenses results mainly from a reduction in the costs related to the clinical development of naproxcinod. The cost of sales corresponds to the expenses incurred by NicOx in performing research activities under the contract signed with Pfizer. The Company employed 95 people in research and development on March 31, 2009, compared to 92 people at the same date in 2008.
Administrative and selling expenses reached EUR 3.7 million during the first three months ended March 31, 2009 compared to EUR 2.3 million during the same period in 2008. General and administrative expenses were EUR 1.6 million in the first quarter of 2009 compared to EUR 1.5 million in the first quarter of 2008 and include personnel expenses in administrative and financial functions, as well as the remuneration of corporate officers, including stock option, bonus share and warrant attributions. Selling expenses totaled EUR 2.0 million during the three months ended March 31, 2009 compared to EUR 0.8 million during the same period in 2008, and correspond to the market analysis activities for naproxcinod, as well as the business development and communication activities of the Company. This increase in selling expenses results from the activities linked to the commercial launch preparation for naproxcinod. The Company employed 39 people in its selling, general, and administrative departments on March 31, 2009, compared to 35 people on March 31, 2008.
Other income
Other income totaled EUR 1.3 million in the three months ended March 31, 2009, compared to EUR 1.6 million in the same period in 2008. Other income corresponds mainly to the operational subsidies from the research tax credits.
Operating result
The operating loss was EUR 12.0 million during the first quarter of 2009, compared to EUR 14.5 million in the first quarter of 2008. This decrease of the operating loss results from the decrease of development expenses incurred by the Company during the first quarter of 2009 following the completion of the phase 3 clinical development of naproxcinod at the end of 2008.
Other results
Net financial income totaled EUR 0.8 million during the first quarter of 2009 compared to EUR 1.6 million during the three months ended March 31, 2008, and represents mainly the returns on the financial investments of the Company’s cash, cash equivalents and financial instruments.
The income tax expense incurred by NicOx during the first quarter 2009 relates to its subsidiaries and amounted to EUR 0.06 million compared to EUR 0.07 million during the same period in 2008.
Total comprehensive loss for the period
The total comprehensive loss reached EUR 11.2 million during the three months ended March 31, 2009, compared to EUR 13.0 million during the three months ended March 31, 2008. Notwithstanding the increase of selling expenses, the decrease in the total comprehensive loss in the first quarter of 2009 corresponds to the reduction of development expenses due to the completion of the phase 3 clinical development of naproxcinod at the end of 2008.
Consolidated statement of financial position (previously balance sheet)
The indebtedness incurred by NicOx is mainly short-term operating debt. On March 31, 2009 the Company’s current liabilities amounted to EUR 15.2 million, including EUR 11.8 million in accounts payable to suppliers and external collaborators, EUR 1.3 million in accrued compensation for employees, EUR 1.3 million in taxes payable, EUR 0.7 million in deferred revenues due to payments received under collaboration agreements and EUR 0.1 million for other liabilities.
Other current assets were EUR 6.7 million on March 31, 2009, compared to EUR 3.3 million on December 31, 2008. They correspond to the advance payments made to DSM, the active ingredient supplier of naproxcinod, to support the planned production of a pre-launch inventory of naproxcinod. This item will continue to increase until the end of 2009.
The Company’s current and non-current financial instruments and cash and cash equivalents were EUR 84.6 million on March 31, 2009, compared to EUR 104.7 million on December 31, 2008, and EUR 153.7 million on March 31, 2008.
The Company anticipates that its research and development expenses will continue to decrease in 2009, following the completion of the phase 3 clinical program of naproxcinod in 2008. NicOx has the strategic objective of transforming itself into a self-sustainable biopharmaceutical company. Commercial expenses are expected to continue to increase strongly over the coming financial years, as a result of the anticipated launch preparation activities for naproxcinod. Overall, operating expenses are expected to continue to decrease in 2009, compared to 2008.
Notwithstanding the increase of commercial expenses, the Company’s consumption of financial instruments and cash and cash equivalents will continue to decrease significantly in 2009 due to the expected reduction of development expenses, following the completion of the phase 3 clinical program for naproxcinod in 2008. Current budgetary estimates suggest NicOx has sufficient cash to finance the activities of the Company until the end of 2010. This projection does not include any possible upfront and milestone payments that could arise from a potential commercialization agreement for naproxcinod.
NicOx (Bloomberg: COX:FP, Reuters: NCOX.PA) is a product-driven biopharmaceutical company dedicated to the development and future commercialization of investigational drugs for unmet medical needs. NicOx is applying its proprietary nitric oxide-donating technology to develop an internal portfolio of New Chemical Entities (NCEs) in the therapeutic areas of inflammatory and cardio-metabolic disease.
Resources are focused on the development and pre-commercialization activities for naproxcinod, a proprietary NCE and a Cyclooxygenase- Inhibiting Nitric Oxide-Donating (CINOD) anti-inflammatory agent for the treatment of the signs and symptoms of osteoarthritis. Naproxcinod has completed three pivotal phase 3 studies with positive results and the submission of a New Drug Application (NDA) to the US Food and Drug Administration (FDA) is projected for mid-2009.
Beyond naproxcinod, NicOx has a pipeline containing multiple nitric oxide- donating NCEs, which are in development internally and with partners, including Pfizer Inc and Merck & Co., Inc., for the treatment of prevalent and underserved diseases, such as atherosclerosis, hypertension, widespread eye diseases and respiratory diseases.
NicOx S.A. is headquartered in France and is listed on the NYSE Euronext Paris (Compartment B: Mid Caps).
This press release contains certain forward-looking statements. Although the Company believes its expectations are based on reasonable assumptions, these forward-looking statements are subject to numerous risks and uncertainties, which could cause actual results to differ materially from those anticipated in the forward-looking statements.
For a discussion of risks and uncertainties which could cause actual results, financial condition, performance or achievements of NicOx S.A. to differ from those contained in the forward-looking statements, please refer to the Risk Factors (“Facteurs de Risque”) section of the Document de Reference filed with the AMF, which is available on the AMF website (http://www.amf-france.org) or on NicOx S.A.'s website (http://www.nicox.com).
CONTACTS: http://www.nicox.com
NicOx: Karl Hanks Director of Investor Relations and Corporate Communication
Tel +33 (0)4 97 24 53 42 - hanks@nicox.com
Media in the United States - FD
Robert Stanislaro - Tel +1 212 850 5657 - robert.stanislaro@fd.com
Irma Gomez-Dib - Tel +1 212 850 5761 - irma.gomez-dib@fd.com
Media in Europe - Citigate Dewe Rogerson
David Dible - Tel +44 (0)207 282 2949 - david.dible@citigatedr.co.uk
Nina Enegren - Tel +44 (0)207 282 1050 - nina.enegren@citigatedr.co.uk
Consolidated statement of Comprehensive Income - march 31, 2009
+-------------------------+--------------------+---------------+ | |End of the reporting| | | |period | | +-------------------------+--------------------+---------------+ | |Unaudited | Unaudited | +-------------------------+--------------------+---------------+ | | | Restated | +-------------------------+--------------------+---------------+ | |March 31, 2009 |March 31, 2008 | +-------------------------+--------------------+---------------+ | |(in thousands of EUR| | | |except for per share| | | |data) | | +-------------------------+--------------------+---------------+ |Revenues |420 | 1,404 | +-------------------------+--------------------+---------------+ |Cost of sales |(79) | (529) | +-------------------------+--------------------+---------------+ |Research and development |(9,932) | (14,632) | |expenses | | | +-------------------------+--------------------+---------------+ |Administrative and |(3,681) | (2,312) | |selling expenses | | | +-------------------------+--------------------+---------------+ |Other income |1,266 | 1,561 | +-------------------------+--------------------+---------------+ |Operating result |(12,006) | (14,508) | +-------------------------+--------------------+---------------+ |Net financial income |823 | 1,617 | +-------------------------+--------------------+---------------+ |Result before income tax |(11,183) | (12,891) | +-------------------------+--------------------+---------------+ |Income tax expense |(60) | (67) | +-------------------------+--------------------+---------------+ |Result for the period |(11,243) | (12,958) | +-------------------------+--------------------+---------------+ |Exchange differences on |(2) | (12) | |translation of foreign | | | |operations | | | +-------------------------+--------------------+---------------+ |Other comprehensive |(2) | (12) | |income (loss) for the | | | |period, net of tax | | | +-------------------------+--------------------+---------------+ |Total comprehensive |(11,245) | (12,970) | |income (loss) for the | | | |period, net of tax | | | +-------------------------+--------------------+---------------+ |Attributable to: | | | +-------------------------+--------------------+---------------+ |Equity holders of the |(11,245) | (12,970) | |Company | | | +-------------------------+--------------------+---------------+ |minority interests |- | - | +-------------------------+--------------------+---------------+ |Earnings per share for |(0.24) | (0.27) | |profit attributable to | | | |equity holders of the | | | |Company | | | +-------------------------+--------------------+---------------+ |Diluted |(0.24) | (0.27) | +-------------------------+--------------------+---------------+
Commentary
IAS 1 R Presentation of Financial Statements
The consolidated financial statements of NicOx S.A. are presented in accordance with IAS 1 Presentation of Financial Statements (revised in 2003). IAS 1 Presentation of Financial Statements has been amended in September 2007 (IAS 1R) and is applicable for financial years beginning on or after 1 January 2009.
The previous version of IAS 1 used the titles “consolidated balance sheet” and “consolidated statement of operations” to refer to two of the financial statements considered to be part of the complete set. The revised standard refers to these statements as the “consolidated statements of financial position” and “consolidated statement of comprehensive income”. NicOx Group has decided to change the titles and use the new terminology suggested by IAS 1R.
This standard also requires an entity to present all owner changes in equity and all non-owner changes either in one statement of comprehensive income or in two separate statements of income and comprehensive income. The previous standard required components of comprehensive income to be presented in the statement of changes in equity. The Group has elected to present all changes in equity in one statement of consolidated comprehensive income.
As of 31 March 2009, the exchange difference on translation of foreign operations is the only component of consolidated comprehensive income or (loss).
CONSOLIDATED STATEMENT OF FINANCIAL POSITION - MARCH 31, 2009
+-------------------------+--------------------+------------------+ | | Unaudited | | +-------------------------+--------------------+------------------+ | | March 31, 2009 |December 31, 2008 | +-------------------------+--------------------+------------------+ | |(in thousands of EUR) | +-------------------------+--------------------+------------------+ |ASSETS | | | +-------------------------+--------------------+------------------+ |Non current assets | | | +-------------------------+--------------------+------------------+ |Property, plant, & | 3,264 | 3,429 | |equipment | | | +-------------------------+--------------------+------------------+ |Intangible assets | 869 | 835 | +-------------------------+--------------------+------------------+ |Non-current financial | - | 4,858 | |instruments | | | +-------------------------+--------------------+------------------+ |Government subsidies | 1,370 | - | |receivable | | | +-------------------------+--------------------+------------------+ |Other financial assets | 208 | 201 | +-------------------------+--------------------+------------------+ |Deferred income tax | 24 | 21 | |assets | | | +-------------------------+--------------------+------------------+ |Total non-current assets | 5,735 | 9,344 | +-------------------------+--------------------+------------------+ |Current assets | | | +-------------------------+--------------------+------------------+ |Financial assets | 573 | 396 | +-------------------------+--------------------+------------------+ |Trade receivables | - | 6 | +-------------------------+--------------------+------------------+ |Government subsidies | 8,875 | 9,004 | |receivable | | | +-------------------------+--------------------+------------------+ |Other current assets | 6,676 | 3,310 | +-------------------------+--------------------+------------------+ |Prepaid expenses | 1,116 | 1,716 | +-------------------------+--------------------+------------------+ |Current financial | 9,986 | 9,912 | |instruments | | | +-------------------------+--------------------+------------------+ |Cash and cash equivalents| 74,617 | 89,931 | +-------------------------+--------------------+------------------+ |Total current assets | 101,843 | 114,275 | +-------------------------+--------------------+------------------+ |TOTAL ASSETS | 107,578 | 123,619 | +-------------------------+--------------------+------------------+ |EQUITY AND LIABILITIES | | | +-------------------------+--------------------+------------------+ |Capital and Reserves | | | |attributable to equity | | | |holders of the Company | | | +-------------------------+--------------------+------------------+ |Ordinary shares | 9,512 | 9,498 | +-------------------------+--------------------+------------------+ |Other reserves | 82,554 | 92,571 | +-------------------------+--------------------+------------------+ |Minority interests | - | - | +-------------------------+--------------------+------------------+ |Total Equity | 92,066 | 102,069 | +-------------------------+--------------------+------------------+ |Non-current liabilities | | | +-------------------------+--------------------+------------------+ |Provisions for other | 220 | 175 | |liabilities and charges | | | +-------------------------+--------------------+------------------+ |Deferred income tax | 129 | 127 | |liabilities | | | +-------------------------+--------------------+------------------+ |Finance lease | 11 | 13 | +-------------------------+--------------------+------------------+ |Total non-current | 360 | 315 | |liabilities | | | +-------------------------+--------------------+------------------+ |Current liabilities | | | +-------------------------+--------------------+------------------+ |Finance lease | 7 | 6 | +-------------------------+--------------------+------------------+ |Trade payables | 11,783 | 16,232 | +-------------------------+--------------------+------------------+ |Deferred revenue | 699 | 1,119 | +-------------------------+--------------------+------------------+ |Current income tax | 34 | - | |payable | | | +-------------------------+--------------------+------------------+ |Social security and other| 2,552 | 3,568 | |taxes | | | +-------------------------+--------------------+------------------+ |Other liabilities | 77 | 310 | +-------------------------+--------------------+------------------+ |Total current liabilities| 15,152 | 21,235 | +-------------------------+--------------------+------------------+ |TOTAL EQUITY AND | 107,578 | 123,619 | |LIABILITIES | | | +-------------------------+--------------------+------------------+
This information is provided by HUGIN
