ProMetic Life Sciences Inc. Reports Its Third Quarter 2009 Highlights and Financial Results

MONTREAL, QUEBEC--(Marketwire - November 13, 2009) - ProMetic Life Sciences Inc. (TSX: PLI)

- Net Profit of $0.2 M in Q3 2009 vs. Net Losses of $3.6 M in Q3 2008

- YTD Sales of $9.3 M vs. $6.2 M in 2008, up 50%

- YTD Net Losses reduced to $7.0 M vs. $15.0 M in 2008, down 53%

- Significant YTD reduction of cash used in operations - $2.5 M vs. $14.1 M, down 82%

ProMetic Life Sciences Inc. (TSX: PLI) (“ProMetic”) today reports business highlights and financial results for the third quarter of 2009. All amounts are in Canadian dollars unless otherwise indicated.

“Responding to the ever changing commercial landscape, ProMetic has tailored the burn to support its revenue generating activities, improved efficiencies, reduced research and development expenses, as well as reduced employee numbers in sectors of activity outside its core objectives,” stated Mr. Pierre Laurin, President and Chief Executive Officer of ProMetic. Mr. Laurin further added: “The dramatic reduction in the use of cash in operations compared to the same period last year is a good indicator that the Company is meeting its objectives of maximizing its cash runway to allow for the achievement of its key drivers”.

Improvements across all business segments

Analysing the business segment performance for the quarter and the year to date, each part of the business is showing significant improvement.

 Quarter ended 30 September 2009 Year to date Profit/(Loss)(i) 2009 2008 Change % 2009 2008 Change % Therapeutics (485)(1,049) 53.8 % (1,927) (3,413) 43.5 % Protein Technologies 781 (944) 182.7 % (1,014) (5,021) 79.8 % Corporate (134)(1,645) 92.0 % (4,026) (6,570) 38.7 % Total Profit/(Loss) 163 (3,639) 104.5 % (6,967)(15,003) 53.6 % (i) in thousands of dollars 

Outlook for 2009

Management’s outlook for 2009 remains positive. Despite the fact that revenues from our development contracts have been lower than expected, resulting from amendments to the programs requested by our clients, management has been able to control and modulate the cost base of the business to minimise impact on EBITDA forecasts.

Adoption of P-Capt® Filter

The Advisory Committee on the Safety of Blood, Tissues and Organs (“SaBTO”) held a closed meeting on the 27th of October 2009. It is the Company’s understanding that the adoption of the P-Capt® filter was discussed at that meeting. The committee was expected to make its recommendation on whether or not the filter should be adopted by the UK Blood Service, and at what scale, at that meeting. The minutes have not yet been made public, and neither the Company, nor its marketing partner MacoPharma SA, is aware of the outcome of the meeting. It is expected, based on comments from SaBTO, that the minutes of the meeting will be made public within the next few days.

The P-Capt® filter is the only approved product proven to be effective for the removal of endogenous blood-borne prion infectivity from red blood cell concentrate (“RBC”) prior to transfusion. RBC is passed through the filter under gravity and Pathogen Removal and Diagnostic Technologies Inc.'s (“PRDT”) highly specific affinity adsorbent material captures and removes variant Creutzfeldt-Jakob Disease (“vCJD”) prion protein.

Highlights by business segment

Corporate

- 1,500,000 pounds sterling revenue prepayment against an existing supply contract with Octapharma AG (“Octapharma”), which brings the total prepaid to date to pounds sterling 2,000,000. A further pounds sterling 500,000 is available for drawdown against future milestones presently expected to be achieved in the first half of 2010.

- $2,250,000 additional loans from long-term stakeholders.

- Repayment of final instalments of $12,000,000 debt contracted in 2006.

- ProMetic obtained controlling stake in PRDT by exchanging a declining royalty stream based on future revenues for the American Red Cross’s 51% share of the common stock. This has increased ProMetic’s ownership of common stock in PRDT to 77%.

- Subsequent to the end of the third quarter, ProMetic BioSciences Ltd secured a further interest-free working capital grant from the Isle of Man Department of Trade and Industry (“DTI”), in the sum of 500,000 pounds sterling.

Protein Technologies

- Long-term (5-year) supply agreement with major global pharmaceutical company, securing an initial order of $8.9 M for the supply of a Mimetic LigandTM product. Deliveries to complete this contract are expected between the last quarter of 2009 and the first half of 2010.

- Long-term (5-year) supply agreement with Halozyme to provide a synthetic ligand affinity adsorbent for use in the manufacture of its rHuPH20 product, a recombinant version of human hyaluronidase enzyme.

- In July, the UK SaBTO published their recommendations which included the use of commercially available pooled Fresh Frozen Plasma (“FFP”) that is pathogen-inactivated to further reduce the risk of vCJD transmission. This announcement had a direct and positive impact to ProMetic and Octapharma. OctaplasLG®, a pooled virally-inactivated and prion-reduced plasma product meets the required specifications recommended by SaBTO, i.e., greater than5 logs of prion safety compared to UK-sourced FFP.

- OctaplasLG® was licensed in Germany and is presently undergoing regulatory approval for use in various countries.

Therapeutics

 - ProMetic was selected by the American Society of Nephrology for multiple presentations regarding PBI-1402 at its 42nd Annual Meeting & Scientific Exposition. These new results presented suggest that: - PBI-1402 offers the potential for a novel therapy by prevention and/or reduction of fibrosis and sclerosis in the kidney and therefore preserving the renal function in patients with chronic kidney disease. - PBI-1402 has protective effects against drug-induced toxicity to the kidney (such as during chemotherapy) again supporting its potential use as a nephroprotective agent. - PBI-1402 offers the potential for a novel therapy of anemia associated with chronic renal failure. - The recent data generated to support the effect of PBI-1402 on nephroprotection and its unique safety profile for potential use in cancer patients constitute significant milestone achievements both for future regulatory filings and partnering activities. - Management has acted to cut the burn-rate of this division such that only costs associated with the regulatory and partnering activities for PBI-1402 and its analogues are incurred. 

Financials Results

The following information should be read in conjunction with the financial statements for the third quarter ending September 30, 2009, as well as the Management’s Discussion and Analysis for the same period.

The results for the quarter show a net profit of $0.2 M compared to a net loss of $3.6 M in the same period in 2008, after taking account of the exceptional gain associated with the PRDT acquisition and the gain on exchange rate. The underlying position remains positive. Revenues for the third quarter 2009 consistent with the same quarter last year at $3.1 M, but costs significantly down.

For the first nine months of 2009, revenues were $9.3 million compared to $6.2 million for the same period last year, while the net losses were reduced by 53%, $7 M in 2009 versus $15 M in 2008.

A decrease of $2.7 M in cash used in operations was recorded during the third quarter 2009, versus the same period in 2008. For the first nine months of 2009, a total decrease of $11.6 M in cash used for operations was recorded, versus the same period in 2008, mainly due to increased sales and the cost cutting measures initiated by ProMetic’s Management team. As already stated, expenditures have been reduced in the non-revenue generating segments of the business.

Balance Sheet and Financing

Throughout 2009, the Company has been successful in securing patient debt, principally from existing shareholders whose interests are aligned with those of the business. In addition, an advance on revenues has been received from Octapharma with whom ProMetic has a long-term supply arrangement, with repayments being made against future sales of product to that customer. Furthermore, working capital grants have been secured from the Isle of Man DTI to assist with the growth of PBL’s business.

Certain of these arrangements have required the up-front payment of interest in the form of shares. Therefore, the funding is partially dilutive, but the level of dilution has been minimal in comparison to the dilution level that would have occurred if an equity investment or other more equity-like instruments had been used to finance the Company.

Clearly, the debt financing has had an impact on the balance sheet, increasing liabilities compared with increasing shareholder equity if the financing had been raised through the sale of common stock.

The Company is aware that during the late part of 2009 and into 2010, efforts must be made to strengthen the balance sheet of the business. It is envisaged that this might be achieved through a combination of revenue growth (sales, milestones and licensing revenues) and, if conditions are right, through the issuance of more equity to help with the reduction of liabilities.

ProMetic’s MD&A and 2009 Third Quarter Financial Statements have been filed on Sedar (www.sedar.com) and are now available on the Company’s web site at www.prometic.com.

Conference Call Details

The Company will be holding a conference call / webcast on Monday, November 16, 2009, at 10:30 (EST).

The numbers to access the conference call are (416) 620-2407 (international) and 1 (800) 215-2393 (toll free). A live audio webcast of the conference call will be available through ProMetic’s website at http://www.prometic.com/en/news-events/events.php.

A replay of the call will be available by telephone for a period of seven days as of Monday, November 16, 2009, at 12:00 (EST). The numbers to access the audio replay are (416) 626-4100 (international) and 1 (800) 558-5253 (toll free) using access code 21442463. The replay of the web cast may be downloaded directly from ProMetic’s web site.

About ProMetic Life Sciences Inc.

ProMetic Life Sciences Inc. (“ProMetic”) (www.prometic.com) is a biopharmaceutical company specialized in the research, development, manufacture and marketing of a variety of commercial applications derived from its proprietary Mimetic Ligand™ technology. This technology is used in large-scale purification of biologics and the elimination of pathogens. ProMetic is also active in therapeutic drug development with the mission to bring to market effective, innovative, lower cost, less toxic products for the treatment of hematology and cancer. Its drug discovery platform is focused on replacing complex, expensive proteins with synthetic “drug-like” protein mimetics. Headquartered in Montreal (Canada), ProMetic has R&D facilities in the U.K., the U.S. and Canada, manufacturing facilities in the U.K. and business development activities in the U.S., Europe, Asia and in the Middle-East.

Forward Looking Statements

This press release contains forward-looking statements about ProMetic’s objectives, strategies and businesses that involve risks and uncertainties. These statements are “forward-looking” because they are based on our current expectations about the markets we operate in and on various estimates and assumptions. Actual events or results may differ materially from those anticipated in these forward-looking statements if known or unknown risks affect our business, or if our estimates or assumptions turn out to be inaccurate. Such risks and assumptions include, but are not limited to, ProMetic’s ability to develop, manufacture, and successfully commercialize value-added pharmaceutical products, the availability of funds and resources to pursue R&D projects, the successful and timely completion of clinical studies, the ability of ProMetic to take advantage of business opportunities in the pharmaceutical industry, uncertainties related to the regulatory process and general changes in economic conditions. You will find a more detailed assessment of the risks that could cause actual events or results to materially differ from our current expectations on page 25 of ProMetic’s Annual Information Form for the year ended December 31, 2008, under the heading “Risk and Uncertainties related to ProMetic’s business”. As a result, we cannot guarantee that any forward-looking statement will materialize. We assume no obligation to update any forward-looking statement even if new information becomes available, as a result of future events or for any other reason, unless required by applicable securities laws and regulations. All amounts are in Canadian dollars unless indicated otherwise.