Acusphere, Inc. Reports Q1 2006 Financial Results and Operating Highlights.WATERTOWN, Mass. -- Acusphere, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : ACUS acus (a´kus) a needle or needle-like process. acus a needle or needle-like process. ) -Results Due in June from First of Two Concurrently Run Phase 3 Clinical Trials- Acusphere, Inc. (NASDAQ: ACUS) today reported financial results for the quarter ended March 31, 2006 and commented on operational progress. During the three months ended March 31, 2006, the Company's primary focus remained on its lead product candidate, AI-700, an ultrasound contrast agent being developed for use in echocardiography Echocardiography Definition Echocardiography is a diagnostic test that uses ultrasound waves to create an image of the heart muscle. Ultrasound waves that rebound or echo off the heart can show the size, shape, and movement of the heart's valves and , with all recognized revenue and the majority of operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. related to the development program for AI-700. Operating Progress During the first quarter of 2006, the Company announced that it completed enrollment and closed one of its two Phase 3 clinical trials phase 3 clinical trial Phase 3 study. See Phase study. for AI-700, the "32" trial. Acusphere expects to make a public announcement about the results from this trial in early June during the annual meeting of the American Society of Echocardiology (ASE (Adaptive Server Enterprise) A relational DBMS from Sybase that runs on Windows NT/2000, Linux and a variety of Unix platforms. ASE is a comprehensive and robust data management product with a long history dating back to the late 1980s. ). The Company continues to enroll patients in its other AI-700 Phase 3 clinical trial, the "33" trial. The Company anticipates completing enrollment in this trial in Q2 2006 and expects to announce results from this trial during Q4 2006. In preparation for announcement of these results and subsequent publication activities, these two Phase 3 clinical trials, previously referred to as the"32" and "33" trials, have been renamed by the investigative team leadership to better reflect the trial design. The trials will be reported under the names RAMP 1 and RAMP 2, respectively. RAMP stands for Real-time Assessment of Myocardial myocardial /myo·car·di·al/ (-kahr´de-al) pertaining to the muscular tissue of the heart. myocardial pertaining to the muscular tissue of the heart (the myocardium). Perfusion perfusion /per·fu·sion/ (-zhun) 1. the act of pouring over or through, especially the passage of a fluid through the vessels of a specific organ. 2. a liquid poured over or through an organ or tissue. with echocardiography. AI-700 has been designed to help detect myocardial perfusion defects using standard, real-time ultrasound real-time ultrasound n. The use of a rapid succession of individual B-mode images to produce a moving video display. techniques. Myocardial perfusion is blood flow in the heart muscle, and is considered a more sensitive marker of coronary heart disease coronary heart disease: see coronary artery disease. coronary heart disease or ischemic heart disease Progressive reduction of blood supply to the heart muscle due to narrowing or blocking of a coronary artery (see atherosclerosis). (CHD CHD coronary heart disease. ChD abbr. Latin Chirurgiae Doctor (Doctor of Surgery) CHD, n.pr See disease, coronary heart. CHD canine hip dysplasia. ) than assessing heart wall motion alone, which today is the typical ultrasound test modality modality /mo·dal·i·ty/ (mo-dal´i-te) 1. a method of application of, or the employment of, any therapeutic agent, especially a physical agent. 2. . Ultrasound with AI-700, by providing both perfusion and wall motion assessment, has the potential to deliver significantly more effective screening for CHD than the current stress echo test and offers substantial potential cost and convenience advantages over nuclear stress testing Determining the durability of a system by pushing it to its limits. Stress testing a network is performed by transmitting excessive numbers of packets or attempting to break in illegally. . Acusphere indicated that qualification of its commercial manufacturing facility is on track with commissioning activities substantially completed, as planned, in the first quarter of 2006. Commissioning is a program which confirms that all process equipment, support systems and utilities are complete and functional. Acusphere is now working to produce development batches of AI-700 in this new facility. In Q1, Acusphere strengthened its management team through the addition of Mona Haynes in the newly created position of Vice President, Marketing and Sales. This addition is an important step in developing the structure and strategy to take full advantage of the commercial opportunities for AI-700. Ms. Haynes brings a deep understanding of the process involved in driving new pharmaceutical product adoption through her prior experience in building the marketing functions for two important drugs, Biogen's Avonex(R) and Alkermes' Vivitrol(TM). "Steps towards locking the RAMP 1 database are moving faster than previously expected. We now hope to have these results revealed to us in time for discussion in early June during the annual meeting of the American Society of Echocardiography The American Society of Echocardiography (ASE) is a professional organization of physicians, cardiac sonographers, nurses and scientists involved in echocardiography, the use of ultrasound to image the heart and vascular system. . Although we remain blinded to the RAMP 1 efficacy results, we remain confident in AI-700, as demonstrated by our recent actions, such as adding marketing and sales leadership. We believe that this confidence is also reflected in the actions of our partner, Nycomed, in helping ensure that we have adequate resources to remain on schedule in the qualification of our manufacturing facility," stated Sherri C. Oberg, President and Chief Executive Officer. "Transforming the quality of ultrasound for the diagnosis of coronary heart disease through the addition of perfusion assessment, combined with compelling cost and convenience advantages of ultrasound over nuclear stress, are powerful drivers that have the potential to create tremendous opportunities for our investors." The Company also indicated that recently it successfully completed the reformulation of a hydrophobic hydrophobic /hy·dro·pho·bic/ (-fo´bik) 1. pertaining to hydrophobia (rabies). 2. not readily absorbing water, or being adversely affected by water. 3. agent in dose form for a large pharmaceutical company as part of a previously announced feasibility study The analysis of a problem to determine if it can be solved effectively. The operational (will it work?), economical (costs and benefits) and technical (can it be built?) aspects are part of the study. Results of the study determine whether the solution should be implemented. . The Company's portion of this work was completed within the agreed-upon time requirements and the Company believes that the results of this work meet all of the pre-determined specifications for this study. This new formulation has been delivered to the pharmaceutical company for evaluation. Hydrophobic drugs do not dissolve well in water, and as result, have inconvenient dosing or undesirable safety profiles because of the techniques required to get them to dissolve. Acusphere's Hydrophobic Drug Delivery System (HDDS HDDS Hazards Data Distribution System HDDS High-Density Data System HDDS Hull Design Database System HDDS Hazardous Device Disposal Squad HDDS Hold Deck Deck Switch HDDS Hydro-Dynamic Device Simulator ) technology, utilized in this reformulation, enables improved formulations of hydrophobic drugs. The ability of this technology to improve dissolution of hydrophobic drugs has been demonstrated through numerous laboratory tests and in a Phase 1 study of a leading hydrophobic cancer drug. Financial Results The Company's financial results for the quarter ended March 31, 2006, are summarized in the accompanying table and detailed in Acusphere's Form 10-Q Form 10-Q See 10-Q. to be filed today with the U.S. Securities and Exchange Commission. During the three months ended March 31, 2006, the Company's primary focus remained on its lead product candidate, AI-700, with all recognized revenue and the majority of operating expenses related to AI-700 development. Revenues recognized in Q1 2006 were equal to revenues in Q1 2005. These revenues were derived from the Company's collaboration agreement with Nycomed, the Company's partner for AI-700 in Europe. During Q1, as previously announced, Nycomed amended its agreement with the Company to provide up to $1.85 million in support for qualification of the Company's commercial manufacturing facility for AI-700. No revenue from this amendment was recognized in Q1. Total operating expenses for Q1 2006 increased to $13.4 million from $9.4 million in Q1 2005. This $4.0 million increase resulted primarily from an increase in depreciation expense of $2.0 million, relating primarily to the Company's commercial manufacturing facility, and a $0.5 million increase in stock-based compensation, relating primarily to the Company's adoption in 2006 of FAS 123R using a modified prospective application. The remaining increase in operating expense Operating Expense The essential things that a company must purchase in order to maintain business. Notes: For example, the payment of employees wages are an operating expense. Also known as OPEX. relates primarily to increased costs associated with the validation of the Company's commercial manufacturing facility, partially offset by reduced clinical trial costs resulting from previously announced completion of enrollment in one of its two pivotal Phase 3 clinical trials for AI-700. Q1 net loss, after $0.6 million in dividends on the outstanding preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. , was $14.1 million, or $0.61 per common share. The Company's net cash burn in Q1, the majority of which resulted from operating activities, was approximately $13.3MM, including a $3.3MM reduction in accounts payable and accrued expenses Accrued Expense An accounting expense recognized in the books before it is paid for. It is a liability, usually current. These expenses are typically periodic and documented upon a company's balance sheet due to the high probability of collection. . Previously, the Company estimated aggregate cash burn for 2006 at between $40MM and $50MM, including cash burn from operating activities of up to $40MM, repayment of long-term obligation payments of approximately $8MM, CAPEX purchases of $3MM-$4MM and potential dividends on preferred stock of up to $2.4MM. The Company's Q1 results are consistent with this prior 2006 guidance noting that cash spending for AI-700 clinical trials is expected to decline during 2006 as enrollment in both Phase 3 clinical trials is completed. As of March 31, 2006 the Company's balance sheet reflects $80.9MM in total assets, including $37.8MM in cash and short-term investments. These balances exclude the results of the previously announced equity financing Equity Financing The act of raising money for company activities by selling common or preferred stock to individual or institutional investors. In return for the money paid, shareholders receive ownership interests in the corporation. completed in April 2006, net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). to Acusphere from which were approximately $37.8MM. In that offering, the Company sold 5.8MM shares of common stock together with warrants for an aggregate of 1.7MM additional shares at $6.9675 per share and warrant unit. The exercise price of the warrants is $7.97 per share. As of today, there are approximately 28.8MM shares of the Company's common stock outstanding and approximately 5.2MM common stock equivalents outstanding underlying the Company's outstanding preferred stock. Upcoming Milestones The Company is working to achieve the following milestones: --Results of RAMP 1 in early June during ASE --Completion of enrollment in the RAMP 2 trial in Q2 2006 --Results of RAMP 2 in Q4 2006 --Production of development batches of AI-700 in our commercial manufacturing facility in Q2 2006 --NDA filing for AI-700 in H1 2007 Conference Call Information Acusphere plans to hold a conference call with investors today, Friday, May 12, 2006, commencing at 11:00 a.m. (Eastern Daylight Time). The conference call will include discussion of the Company's operating results, financing results, priorities, and other operational matters and disclosures followed by answers to investor questions. The conference may be heard live via the investor relations Investor relations The process by which the corporation communicates with its investors. section of the Company's website at www.acusphere.com or by dialing 1-800-573-4752, using the confirmation code: 63444643. For participants dialing in from outside the U.S. please call 1-617-224-4324 using the same confirmation code. After the conference call, a replay of the call will be made available for 30 days via the Company's web site and a telephone replay will be available through May 26 by dialing 1-888-286-8010, or internationally 1-617-801-6888, using the confirmation code: 30607960. About Acusphere, Inc. Acusphere (NASDAQ: ACUS) is a specialty pharmaceutical company that develops new drugs and improved formulations of existing drugs using its proprietary microparticle technology. Acusphere's three initial product candidates are designed to address large unmet clinical needs within cardiology cardiology Medical specialty dealing with heart diseases and disorders. It began with the 1749 publication by Jean Baptiste de Sénac of contemporary knowledge of the heart. Diagnostic methods improved in the 19th century, and in 1905 the electrocardiograph was invented. , oncology oncology /on·col·o·gy/ (ong-kol´ah-je) the sum of knowledge regarding tumors; the study of tumors. on·col·o·gy n. and asthma. These product candidates were created using proprietary technology that enables Acusphere to control the porosity porosity /po·ros·i·ty/ (por-os´it-e) the condition of being porous; a pore. po·ros·i·ty n. 1. The state or property of being porous. 2. and size of nanoparticles and microparticles in a versatile manner that allows particles to be customized to address the delivery needs of a variety of drugs. Acusphere's lead product candidate, AI-700, is a cardiovascular drug in Phase 3 clinical development. AI-700 is designed to enable ultrasound to compete more effectively with nuclear stress testing, the leading procedure for detecting coronary heart disease. An estimated 11.9 million procedures are done each year in the U.S. to detect coronary heart disease, the leading cause of death in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . For more information about Acusphere visit the Company's web site at www.acusphere.com. "Acusphere" is a trademark of Acusphere, Inc. Forward-looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. The above press release contains forward-looking statements which are made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of Section 21E of the Securities Exchange Act of 1934, including statements regarding the successful completion of clinical trials, upcoming milestone timing and content, capital requirements Capital requirements Financing required for the operation of a business, composed of long-term and working capital plus fixed assets. , commercial prospects for the Company's product candidates and feasibility study results. All such forward-looking statements are made pursuant to the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934. The Company's actual results may differ materially from those anticipated in these forward-looking statements based upon a number of factors, including anticipated operating losses operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. and existing capital obligations, uncertainties associated with research, development, testing and related regulatory approvals, including uncertainties regarding the ultimate outcome of Acusphere's Phase 3 clinical trials for AI-700 and uncertainties regarding the number of patients required to complete the Phase 3 clinical trials, unproven unproven Dubious, nonscientific, not proven, quack, questionable, unscientific adjective Relating to that which has not been validated by reproducible experiments or other scientific methods for determining effect or efficacy markets, future capital needs and uncertainty of additional financing, lack of sales and marketing experience, uncertainties associated with intellectual property, uncertainties regarding the cost, timing and ultimate success of the qualification of the Company's commercial manufacturing facility in accordance with applicable regulatory requirements Regulatory requirements are part of the process of drug discovery and drug development. Regulatory requirements describe what is necessary for a new drug to be approved for marketing in any particular country. ,, complex manufacturing, high quality requirements, lack of commercial manufacturing experience, dependence on third-party manufacturers, suppliers and collaborators, competition, loss of key personnel, uncertainties associated with market acceptance and adequacy of reimbursement Reimbursement Payment made to someone for out-of-pocket expenses has incurred. , technological change and government regulation, and other risks and challenges detailed in the Company's filings with the U.S. Securities and Exchange Commission, including the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2006. Readers are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date of this press release. The Company undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances that occur after the date of this press release or to reflect the occurrence of unanticipated events.
ACUSPHERE, INC.
FINANCIAL HIGHLIGHTS
-- In Thousands (except per share data) --
CONDENSED CONSOLIDATED OPERATING RESULTS
(Unaudited)
Three Months
Ended
-----------------
March March
31, 31,
2006 2005
Collaboration revenue $857 $857
Operating expenses:
Research and development 10,873 7,678
General and administrative 2,554 1,747
-----------------
Total operating expenses 13,427 9,425
Interest and other income (expense) (4) 161
Change in valuation of derivative (879) 434
-----------------
Net loss ($13,453)($7,973)
Dividends on preferred stock (601) -
-----------------
Net loss available to common stockholders ($14,054)($7,973)
Net loss per common share - basic and diluted ($0.61) ($0.45)
Weighted-average shares outstanding - basic and
diluted 22,888 17,813
CONDENSED CONSOLIDATED BALANCE SHEET INFORMATION
(Unaudited)
----------------
March December
31, 31,
2006 2005
----------------
Cash and short-term investments $37,847 $51,112
Current assets 39,264 52,254
Total assets 80,903 95,839
Current portion of deferred revenue 3,569 3,429
Other current liabilities 16,407 17,814
Long-term liabilities 16,774 17,179
Stockholders' equity 44,153 57,417
|
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion