MONTVALE, N.J., May 14 /PRNewswire-FirstCall/ -- Memory Pharmaceuticals Corp. today reported its financial results for the first quarter ended March 31, 2008.
"We had a productive start to 2008, reporting significant progress with our collaborations and refocusing our operations to advance four high-value programs," said Vaughn M. Kailian, President and Chief Executive Officer. "Roche's recent decision to license R3487/MEM 3454 highlights the potential of the compound, provides a development path forward for our lead nicotinic alpha-7 receptor agonist, strengthens our financial profile and certainly validates our expertise in CNS drug development. We remain on track to achieve the following 2008 goals for each of our four major development programs: completing and announcing top-line results for our Phase 2a trial of R3487/MEM 3454 in cognitive impairment in schizophrenia and our Phase 1 program for R4996/MEM 63908, initiating a Phase 2a trial for MEM 1414, and advancing our 5-HT6 antagonist program into the clinic."
Financial Results
For the quarter ended March 31, 2008, the Company reported a net loss of $13.4 million, or $0.18 per share, compared to a net loss of $8.9 million, or $0.13 per share, for the same period in 2007.
For the quarter ended March 31, 2008, the Company reported revenue of $0.8 million, compared to revenue of $2.7 million for the same period in 2007. The decrease in revenue is a result of the conclusion of the research and development funding portion of the Company's collaboration with Amgen related to the development of PDE10 inhibitors.
Research and development expenses for the quarter ended March 31, 2008 were $11.0 million compared to $9.9 million for the same period in 2007. The change included $3.1 million in increased costs related to the development of R3487/MEM 3454 and R4996/MEM 63908, and a $0.9 million increase related to manufacturing and preclinical costs associated with the 5-HT6 antagonist program, offset by a $3.4 million decrease in costs associated with the clinical development of MEM 1003.
General and administrative expenses for the quarter ended March 31, 2008 were $2.9 million, compared to $2.3 million for the same period in 2007. The change included an increase of $0.2 million in personnel and personnel-related costs, a $0.2 million increase in legal fees, and a $0.2 million increase in outside services.
At March 31, 2008, the Company had cash, cash equivalents and marketable securities of approximately $27.5 million, compared to $38.2 million at the end of 2007. The Company continues to expect that its existing cash, cash equivalents, and marketable securities, together with payments expected to be made under its collaboration agreements, should be sufficient to fund operating expenses, scheduled debt obligations and capital equipment requirements into the first half of 2009.
First Quarter Highlights and Recent Developments
-- Roche Opt-in for R3487/MEM 3454. In May, Roche exercised its option to
license R3487/MEM 3454, Memory Pharmaceuticals' lead nicotinic alpha-7
receptor agonist, for further development and commercialization in
psychiatric and neurological disorders. The option exercise triggers a
$6.0 million milestone payment and entitles Memory Pharmaceuticals to
future payments upon the achievement of additional milestones and
royalties on product sales, including a $17.0 million milestone payment
upon the completion of the ongoing Phase 2a study in cognitive
impairment associated with schizophrenia. In addition, Memory
Pharmaceuticals retains an option to co-promote R3487/MEM 3454 in the
United States.
-- Expanded Development Program for R3487/MEM 3454 in Schizophrenia. In
February, Memory Pharmaceuticals announced that it plans to conduct a
clinical study of R3487/MEM 3454 on two biomarkers of schizophrenia,
P50 sensory gating and mismatch negativity, in patients with
schizophrenia. External costs of the biomarker study, and additional
formulation and manufacturing activities for R3487/MEM 3454, will be
funded by Roche. The Company expects to begin the study this summer,
with data available by early 2009.
-- Expanded PDE10 Collaboration with Amgen. In March, the Company
extended the preclinical research portion of its collaboration with
Amgen focused on the development of PDE10 inhibitors for certain
neurological and psychiatric disorders. Memory Pharmaceuticals agreed
to commit and fund certain preclinical research resources and provide
increased access to its screening technologies to the collaboration for
an additional twelve months. In exchange, Memory Pharmaceuticals will
receive increased milestone payments upon the achievement of certain
predefined development events for the program. The parties also
expanded the scope of compounds eligible for higher tier royalties
under the agreement.
-- Refocused Operations. In March, Memory Pharmaceuticals realigned its
operations and reallocated its resources to refocus its near-term and
mid-term efforts on four major development and clinical programs. The
Company reduced its workforce and research discovery efforts and
shifted its resources toward development activities with two partnered
programs, its nicotinic alpha-7 receptor agonist collaboration with
Roche and the PDE10 collaboration with Amgen, and two proprietary
programs, its PDE4 inhibitor and 5-HT6 antagonist programs. The
Company expects the savings from these initiatives to be in the range
of $2-3 million on an annualized basis.
-- Receipt of Nasdaq Notification. On April 2, 2008, the Company received
written notification from Nasdaq that, as of December 31, 2007, the
Company was not in compliance with the minimum $10.0 million
stockholders' equity requirement for continued listing under
Marketplace Rule 4450(a)(3). As required by Nasdaq, the Company has
submitted a plan to achieve and sustain compliance with all of The
Nasdaq Global Market listing requirements and the time frame required
to complete that plan.
Conference Call and Webcast Information
Memory Pharmaceuticals will hold a conference call on May 14, 2008, at 9:00 a.m. EDT to discuss the Company's first quarter 2008 financial results. The conference call will also be broadcast live from the "Investors" section of the Company's website. Memory Pharmaceuticals' senior management will host the conference call. Investors and other interested parties may access the call as follows:
Date: Wednesday, May 14, 2008
Time: 9:00 a.m. EDT
Telephone (U.S.): 866.356.4441
Telephone (international): 617.597.5396
Participant Passcode: 80809977
Webcast: http://www.memorypharma.com/ under the
"Investors" section
An audio replay of the conference call will be available from 11:00 a.m. EDT on Wednesday, May 14, 2008, until Wednesday, May 21, 2008. To access the replay, please dial 888.286.8010 (U.S.) or 617.801.6888 (international) and enter passcode number 14991737. An audio replay of the conference call will also be available under the "Investors" section of the Company's website during the same period.
About the Company
Memory Pharmaceuticals Corp., a biopharmaceutical company, is focused on developing innovative drugs for the treatment of debilitating CNS disorders, many of which exhibit significant impairment of memory and other cognitive functions, including Alzheimer's disease and schizophrenia. For additional information, please visit our website at http://www.memorypharma.com/.
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties. All statements, other than statements of historical facts, regarding management's expectations, beliefs, goals, plans or Memory Pharmaceuticals' prospects, future financial position, future revenues and projected costs should be considered forward-looking. Readers are cautioned that actual results may differ materially from projections or estimates due to a variety of important factors, including the outcome of clinical trials of Memory Pharmaceuticals' drug candidates and whether they demonstrate these candidates' safety and effectiveness; the risks and uncertainties associated with: obtaining additional financing to support Memory Pharmaceuticals' R&D and clinical activities and operations; obtaining regulatory approvals to conduct clinical trials and to commercialize Memory Pharmaceuticals' drug candidates; Memory Pharmaceuticals' ability to enter into and maintain collaborations with third parties for its drug development programs; Memory Pharmaceuticals' dependence on its collaborations and its license relationships; achieving milestones under Memory Pharmaceuticals' collaborations; Memory Pharmaceuticals' dependence on preclinical and clinical investigators, preclinical and clinical research organizations, manufacturers and consultants; protecting the intellectual property developed by or licensed to Memory Pharmaceuticals; and Memory Pharmaceuticals ability to maintain listing on the Nasdaq Global Market. These and other risks are described in greater detail in Memory Pharmaceuticals' filings with the Securities and Exchange Commission. Memory Pharmaceuticals may not actually achieve the goals or plans described in its forward-looking statements, and investors should not place undue reliance on these statements. Memory Pharmaceuticals disclaims any intent or obligation to update any forward-looking statements as a result of developments occurring after the date of this press release.
MEMORY PHARMACEUTICALS CORP.
CONDENSED STATEMENTS OF OPERATIONS
(in thousands - except per share information)
(unaudited)
Three Three
Months Months
Ended Ended
March 31, March 31,
2008 2007
Revenue $752 $2,690
Operating expenses:
Research and development 10,982 9,851
General and administrative 2,874 2,253
Total operating expenses 13,856 12,104
Loss from operations (13,104) (9,414)
Other income 24 -
Interest income (expense), net (365) 551
Loss before income taxes (13,445) (8,863)
Income tax expense - -
Net loss $(13,445) $(8,863)
Basic and diluted net loss
per share of common stock $(0.18) $(0.13)
Basic and diluted weighted average number
of shares of common stock outstanding 72,726 70,146
MEMORY PHARMACEUTICALS CORP.
CONDENSED BALANCE SHEETS
(in thousands)
(unaudited)
March 31, December 31,
2008 2007
ASSETS
Cash, cash equivalents and marketable securities $27,493 $38,201
Other current assets 1,359 1,417
Restricted cash 505 505
Deferred financing costs, net 444 519
Property and equipment, net 5,525 5,868
Total assets $35,326 $46,510
LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY
Current liabilities (excluding deferred revenue) $11,674 $8,789
Equipment notes payable, less current portion 31 66
Loan payable, less current portion 9,669 10,831
Deferred revenue 17,715 18,051
Other non-current liabilities 495 506
Total liabilities 39,584 38,243
Stockholders' (deficit) equity (4,258) 8,267
Total liabilities and
stockholders' (deficit) equity $35,326 $46,510
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