CUPERTINO, Calif., Feb. 10 /PRNewswire-FirstCall/ — DURECT Corporation
(Nasdaq: DRRX) announced today its financial results for the three months and
year ended December 31, 2003.
(Photo: http://www.newscom.com/cgi-bin/prnh/20020717/DRRXLOGO )
DURECT’s net loss for the three months ended December 31, 2003 was $5.3
million or 10 cents per share, compared to a net loss of $8.5 million or 17
cents per share for the same period in 2002. DURECT’s results for the three
months ended December 31, 2003 included non-cash charges for the amortization
of intangible assets and stock-based compensation of $373,000, compared to
$103,000 for the same period in 2002. Cash used in operating activities was
$6.1 million for the three months ended December 31, 2003, compared to $8.4
million for the same period in 2002.
DURECT’s net loss for the year ended December 31, 2003 was $22.7 million
or 45 cents per share, compared to a net loss of $37.2 million or 77 cents per
share for the same period in 2002. DURECT’s results for the year ended
December 31, 2003 included non-cash charges for the amortization of intangible
assets and stock-based compensation of $1.2 million, compared to $2.5 million
for the same period in 2002. Cash used in operating activities was $19.3
million for the year ended December 31, 2003, compared to $31.3 million for
the same period in 2002.
“At present, the Company is implementing improvements to our CHRONOGESIC
product to address the premature shutdown. To date, we have completed 30 days
of testing with new systems in vitro and in vivo. While we continue to perform
additional analyses and generate data around our revised design, we are
pleased with the results we have seen thus far. The initial tests from the in
vivo studies will be completed by the end of the first quarter. During the
course of this year, we will continue our testing, and while we may perform
additional enhancements for our CHRONOGESIC product, we remain confident that
we will move this program back into the clinic,” stated James E. Brown, DVM,
President and CEO of DURECT. “We also moved our SABER(TM) post-operative pain
relief depot product into the clinic last year. We expect to optimize our
formulation to achieve the level of efficacy required for up to 72 hours of
post-operative pain relief, and anticipate moving this program into later-
stage development this year.”
Dr. Brown added, “I’d also like to highlight a significant milestone for
our SABER(TM) Technology. Last month, our partner Pain Therapeutics, Inc.
began Phase I clinical testing on Remoxy(TM), a novel long-acting oral
formulation of oxycodone that utilizes our SABER Technology and which is
targeted to decrease the potential for oxycodone abuse. We look forward to the
clinical results from this program.”
“We feel confident that we will make significant progress in 2004 as we
continue to build and advance our product pipeline. In addition, with an
estimated $130 million in potential R&D funding and milestone payments through
the course of our collaborations combined with over $85 million of cash on our
balance sheet, we have the flexibility and liquidity to fund our research,
development and commercialization activities.”
Total revenues were $3.1 million and $11.8 million for the three months
and the year ended December 31, 2003 respectively, compared to $2.0 million
and $7.2 million for the same periods in 2002. The increase in total revenues
was primarily attributable to higher collaborative research and development
revenue recognized from DURECT’s agreements with various strategic partners as
the Company continued to make progress on the collaboration projects and
higher net product sales from DURECT’s product lines.
Research and development expenses were $4.7 million and $20.9 million for
the three months and the year ended December 31, 2003 respectively, compared
to $5.8 million and $29.6 million for the same periods in 2002. The decreases
were primarily attributable to the lower development costs related to DURECT’s
lead product CHRONOGESIC, offset by a slight increase in research and
development expenses for our post-operative pain product and other direct
expenses incurred under the Company’s collaborative arrangements. The
decreases in the research and development expenses also resulted from lower
research and development personnel expenses compared with the same periods in
2002.
Selling, general and administrative expenses were $1.9 million and $8.5
million for the three months and the year ended December 31, 2003
respectively, compared to $4.0 million and $11.0 million for the same periods
in 2002. The decrease was primarily attributable to effective cost controls in
the existing corporate infrastructure to support all areas of DURECT’s
business. In addition, the decrease was due to a one-time expense of $1.7
million for strategic partner advisory services in connection with the Endo
partnership in the fourth quarter of 2002.
At December 31, 2003, DURECT had cash and investments of $85.2 million,
including $3.1 million in restricted investments, compared with total cash and
investments of $48.3 million at December 31, 2002. This increase was primarily
due to the net proceeds of approximately $56.7 million from the sale of $60.0
million aggregate principal amount of convertible notes in June and July of
2003, offset by cash used in operating activities in the year of 2003.
First Quarter and Fiscal Year 2004 Financial Guidance
- Total cash burn for the fiscal year 2004 is expected to be in the range
of $25.0 million to $27.0 million, which includes interest payment of
$3.8 million for the convertible notes. - DURECT expects its net loss will range from $30.0 million to $32.0
million or 58 to 62 cents per share for the fiscal year of 2004. - DURECT’s estimates include non-cash charges for the amortization of
intangible assets and stock-based compensation of approximately $1.3
million to $1.4 million for the fiscal year of 2004. - DURECT expects its net loss for the first quarter of 2004 will range
from $7.0 million to $8.0 million or 14 or 16 cents per share.
About DURECT Corporation
DURECT Corporation (www.www.durect.com) is pioneering the development and
commercialization of pharmaceutical systems for the treatment of chronic
debilitating diseases and enabling biotechnology-based pharmaceutical
products. DURECT’s goal is to deliver the right drug to the right site in the
right amount at the right time. DURECT’s lead product in development is
CHRONOGESIC, a 3-month product for the treatment of chronic pain. DURECT also
owns three proprietary drug delivery platform technologies, including the
SABER Delivery System (a patented and versatile depot injectable useful for
protein and small molecule delivery), the MICRODUR(TM) Biodegradable
Microparticulates (microspheres injectable system) and the DURIN(TM)
Biodegradable Implant (drug-loaded implant system) upon which DURECT is
developing a pipeline of other products.
NOTE:
CHRONOGESIC(R), SABER(TM), MICRODUR(TM) and DURIN(TM) are trademarks of
DURECT Corporation. Remoxy(TM) is a trademark of Pain Therapeutics, Inc.
The statements in this press release regarding DURECT’s products in
development, product development plans and projected financial results are
forward-looking statements involving risks and uncertainties that can cause
actual results to differ materially from those in such forward-looking
statements. Potential risks and uncertainties include, but are not limited to,
DURECT’s ability to complete the design, development, and manufacturing
process development of its products, manufacture and commercialize its
products, obtain product and manufacturing approvals from regulatory agencies,
manage its growth and expenses, manage relationships with third parties,
finance its activities and operations, as well as marketplace acceptance of
DURECT’s products. Further information regarding these and other risks is
included in DURECT’s Annual Report on Form 10-K for the fiscal year ended
December 31, 2002 filed with the SEC on March 14, 2003, DURECT’s Quarterly
Report on Form 10-Q for the quarter ended September 30, 2003 filed with the
SEC on November 13, 2003 and other periodic reports filed with the SEC under
the heading “Factors that may affect future results.”
CHRONOGESIC, the post operative pain product, Remoxy and other products
mentioned above are under development by DURECT and have not been submitted or
approved for commercialization by the US Food and Drug Administration or other
health authorities.
DURECT CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
Three months ended Year ended
December 31, December 31,
2003 2002 2003 2002
Product revenue, net $1,746 $1,509 $6,691 $6,314
Collaborative research and
development and other revenue 1,358 497 5,144 871
Total revenues 3,104 2,006 11,835 7,185
Operating expenses:
Cost of revenues 587 862 2,427 3,086
Research and development 4,728 5,810 20,948 29,554
Selling, general and administrative 1,895 3,981 8,498 10,970
Amortization of intangible assets 334 335 1,343 1,340
Stock-based compensation(1) 39 (232) (102) 1,204
Total operating expenses 7,583 10,756 33,114 46,154
Loss from operations (4,479) (8,750) (21,279) (38,969)
Other income (expense):
Interest income 309 339 1,041 2,076
Interest expense (1,089) (48) (2,460) (280)
Net other income (expense) (780) 291 (1,419) 1,796
Net loss $(5,259) $(8,459) $(22,698) $(37,173)
Net loss per share, basic and
diluted $(0.10) $(0.17) $(0.45) $(0.77)
Shares used in computing basic and
diluted net loss per share 50,996 49,251 50,510 48,318
(1) Stock-based compensation related to the following:
Cost of revenues $3 $11 $18 $72
Research and development 16 (321) (210) 622
Selling, general and administrative 20 78 90 510
$39 $(232) $(102) $1,204
DURECT CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
(in thousands)
December 31, December 31,
2003 2002 (1)
Assets
Current assets:
Cash and cash equivalents $21,203 $14,089
Short-term investments 39,511 28,711
Accounts Receivable 1,968 944
Inventories 1,902 1,707
Prepaid expenses and other current assets 1,480 1,590
Total current assets 66,064 47,041
Property and equipment, net 9,316 11,625
Goodwill 6,399 4,716
Intangible assets, net 2,994 4,121
Long-term investments 21,334 2,578
Restricted investments 3,119 2,890
Other non-current assets 3,181 --
Total assets $112,407 $72,971
Liabilities and stockholders' equity
Current liabilities:
Accounts payable and accrued liabilities $4,551 $4,568
Long-term obligations, current portion 463 617
Total current liabilities 5,014 5,185
Long-term obligations, noncurrent portion 62,278 1,604
Stockholders' equity 45,115 66,182
Total liabilities and stockholders' equity $112,407 $72,971
(1) Derived from audited financial statements.
SOURCE DURECT Corporation
CONTACT:
Schond L. Greenway, Senior Director, Investor Relations and
Strategic Planning of DURECT Corporation, 408-777-1417
/Photo: NewsCom: http://www.newscom.com/cgi-bin/prnh/20020717/DRRXLOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, +1-888-776-6555 or +1-212-782-2840/
/Web site: http://www.www.durect.com