Conference call scheduled for 8:30 AM Eastern time today RICHMOND,
Calif., Aug. 14 /PRNewswire-FirstCall/ -- Transcept
Pharmaceuticals, Inc. (NASDAQ:TSPT), a specialty pharmaceutical
company focused on the development and commercialization of
proprietary products that address important therapeutic needs in
neuroscience, today announced financial results for the three and
six months ended June 30, 2009. Glenn A. Oclassen, President and
Chief Executive Officer commented, "Our recently announced
agreement with Purdue Pharmaceutical Products, L.P. for the
commercialization of Intermezzo (zolpidem tartrate sublingual
tablet) in the United States has further strengthened our financial
position and has validated the significant potential commercial
opportunity for Intermezzo in the worldwide market for prescription
sleep aids. In addition, our option to co-promote Intermezzo to
psychiatrists in the United States provides us with a valuable
mechanism to build a specialized sales force in a cost-effective
manner and to realize our goal of becoming an integrated specialty
pharmaceutical company." Mr. Oclassen continued, "With a powerful
U.S. primary care sales and marketing partner now in place for the
potential launch of Intermezzo , we look forward to continuing our
work with the FDA in advance of the Intermezzo PDUFA action date of
October 30, 2009. If approved by the FDA, Intermezzo has the
potential to be the first prescription sleep aid specifically
approved for use in the middle of the night at the time a patient
awakens and has difficulty returning to sleep." Under the terms of
our July 31, 2009 agreement with Purdue for the development and
commercialization of Intermezzo : -- Purdue has paid Transcept a
$25 million upfront license fee; -- Transcept will continue to
develop Intermezzo at its expense until FDA approval is received;
-- Purdue will pay Transcept up to $30 million if Purdue elects to
continue with the collaboration after review of an FDA approval for
Intermezzo , after which time Transcept will transfer the
Intermezzo NDA to Purdue and Purdue will assume financial
responsibility for maintaining the NDA and any further product
development for the U.S. market; -- Purdue is then obligated to
launch and commercialize Intermezzo in the United States at its
expense and pay Transcept tiered double-digit base royalties on net
sales of Intermezzo in the United States ranging up to the
mid-twenty-percent level; -- Purdue is potentially obligated to pay
Transcept up to an additional $90 million upon meeting certain
intellectual property milestones and upon the achievement of
certain net sales targets for Intermezzo in the United States; --
Transcept retained an option to co-promote Intermezzo to
psychiatrists in the United States starting as early as the first
anniversary of commercial launch of Intermezzo and would receive an
additional double-digit royalty from Purdue on sales generated by
psychiatrists in the United States; -- Transcept granted Purdue and
an associated company the right to negotiate for the
commercialization of Intermezzo in Mexico and Canada; and --
Transcept retained rights to commercialize Intermezzo in the rest
of the world. Second Quarter 2009 Financial Results Research and
development expenses for the quarter ended June 30, 2009 were
approximately $2.25 million, compared to approximately $2.78
million for the same period in 2008. The $0.53 million decrease is
primarily attributable to lower Intermezzo development costs, the
majority of which were incurred prior to the submission of the NDA
on September 30, 2008. Research and development expenses included
non-cash stock compensation expense in accordance with Statement of
Financial Accounting Standards No. 123R (SFAS No. 123R) of
approximately $108,000 for the quarter ended June 30, 2009 and
$66,000 for the quarter ended June 30, 2008. General and
administrative expenses for the quarter ended June 30, 2009 were
approximately $5.02 million, compared to approximately $1.71
million for the same period in 2008. The $3.31 million increase
consists primarily of higher professional fees to operate as a
public company and to negotiate our collaboration with Purdue,
increased personnel costs primarily in marketing and
administration, increased marketing expenses as we prepared to
commercialize Intermezzo and an increase in operational expenses
associated with the addition of the Novacea office space in South
San Francisco. General and administrative expenses included
non-cash stock compensation expense in accordance with SFAS No.
123R of approximately $225,000 for the quarter ended June 30, 2009,
as compared to $80,000 for the quarter ended June 30, 2008. Net
loss for the quarter ended June 30, 2009 was approximately $7.1
million or $0.54 per share, compared to a net loss of approximately
$4.5 million or $12.09 per share for the quarter ended June 30,
2008. The weighted average common shares used to calculate earnings
per share were 13,070,211 and 372,849 respectively for the quarters
ended June 30, 2009 and 2008. At June 30, 2009 there were
13,075,401 common shares outstanding and 2,247,664 outstanding
options, warrants and common stock subject to repurchase. Six
months ended June 30, 2009 Financial Results Research and
development expenses for the six months ended June 30, 2009 were
approximately $4.47 million, compared to approximately $6.39
million for the same period in 2008. The $1.92 million decrease is
primarily attributable to lower Intermezzo development costs, the
majority of which were incurred prior to the submission of the
Intermezzo NDA on September 30, 2008. Research and development
expenses included non-cash stock compensation expense in accordance
with SFAS No. 123R of approximately $157,000 for the six months
ended June 30, 2009 and $130,000 for the six months ended June 30,
2008. General and administrative expenses for the six months ended
June 30, 2009 were approximately $9.23 million, compared to
approximately $3.22 million for the same period in 2008. The $6.01
million increase consists primarily of higher professional fees to
operate as a public company and to negotiate our collaboration with
Purdue, increased personnel costs primarily in marketing and
administration, increased marketing expenses as we prepared to
commercialize Intermezzo and an increase in operational expenses
associated with the addition of the Novacea office space in South
San Francisco. General and administrative expenses included
non-cash stock compensation expense in accordance with SFAS No.
123R of approximately $394,000 for the six months ended June 30,
2009, as compared to $162,000 for the six months ended June 30,
2008. Year-to-date merger-related transaction costs of
approximately $2.22 million were expensed during the first quarter
of 2009. Net loss for the six months ended June 30, 2009 was
approximately $15.7 million or $1.42 per share, compared to a net
loss of approximately $9.6 million or $26.16 per share for the six
months ended June 30, 2008. The weighted average common shares used
to calculate earnings per share were 11,047,881 and 366,226
respectively for the six months ended June 30, 2009 and 2008. Cash,
cash equivalents and marketable securities totaled $73.4 million at
June 30, 2009, which does not include the $25 million received in
August 2009 upon signing the license and collaboration agreement
with Purdue. 2009 Guidance Transcept continues to expect full year
2009 research and development expenses to remain consistent with
2008 levels. Full year 2009 general and administrative expenses are
expected to increase as compared to 2008 in connection with
activities related to the potential commercialization of Intermezzo
, professional fees related to the merger of Transcept and Novacea
and the collaboration agreement between Transcept and Purdue, and
administrative infrastructure and professional fees related to our
public company status. Conference Call and Webcast Information
Transcept will host a conference call and webcast on Friday, August
14, 2009 at 8:30 a.m. Eastern time to discuss second quarter 2009
financial results. Telephone numbers for the live conference call
are 877-397-0284 (U.S.) or 719-325-4890 (International). The
webcast can be accessed on the Investors page of the Transcept
website at http://www.transcept.com/ and will be available for
replay until close of business on August 29, 2009. A playback of
the call will be available through August 29, 2009 by dialing
888-203-1112 (U.S.) or 719-457-0820 (International), replay
passcode: 2582954. In the event that any non-GAAP financial
information is discussed on the conference call that is not
described in this release, related complementary information will
be made available on the Investors page of the company's website as
soon as practical after the conclusion of the conference call.
About Intermezzo Intermezzo (zolpidem tartrate sublingual tablet)
has the potential to be the first prescription sleep aid
specifically approved for use in the middle of the night at the
time a patient awakens and has difficulty returning to sleep.
Intermezzo is a sublingual low dose formulation of zolpidem, the
active agent most commonly prescribed in the United States for the
treatment of insomnia. Intermezzo uses approximately one-quarter to
one-third of the dose of active drug contained in currently
marketed zolpidem-based sleep aids, in a formulation designed to
promote rapid sublingual absorption. Transcept believes that
Intermezzo , by combining the reduced zolpidem dose with
administration only on those nights when a middle of the night
awakening actually occurs, has the potential to reduce unnecessary
sedative-hypnotic exposure. Two Phase 3 clinical studies evaluated
376 patients receiving either Intermezzo or placebo. In the first
study, a sleep laboratory trial using an objective polysomnographic
endpoint, Intermezzo demonstrated a statistically significant
decrease versus placebo in the time it took patients to return to
sleep as measured by Latency to Persistent Sleep. In the second
study, an outpatient trial, Intermezzo demonstrated a statistically
significant decrease in Latency to Sleep Onset, a subjective
patient reported endpoint. The most common adverse event seen in
these trials was headache (2.7 percent active versus 1.4 percent
placebo in the outpatient study). The FDA has established October
30, 2009 as its target date under PDUFA to take action on its
review of the NDA. Transcept is actively pursuing patents to
protect Intermezzo in the United States and key non-U.S. markets,
and, as part of the NDA submission, has requested that the FDA
grant three years of Hatch-Waxman marketing exclusivity to
Intermezzo . About Transcept Transcept Pharmaceuticals, Inc. is a
specialty pharmaceutical company focused on the development and
commercialization of proprietary products that address important
therapeutic needs in neuroscience. For further information, please
visit the company's website at: http://www.transcept.com/. Forward
Looking Statements This press release contains forward-looking
statements that involve substantial risks and uncertainties. All
statements, other than statements of historical facts, included in
this press release regarding our strategy, future operations,
future financial position, future revenues, projected costs,
prospects, plans and objectives of management are forward-looking
statements. Examples of such statements include, but are not
limited to, statements relating to expectations with respect to the
following: the potential approval and timing of regulatory
decisions with respect to the NDA for Intermezzo ; Intermezzo being
the first commercially available sleep aid in the United States in
its target indication; the launch and market potential of
Intermezzo ; activities of Transcept and Purdue and the
satisfaction of conditions under the collaboration agreement with
Purdue required for the payment of potential milestone payments,
royalties and other Purdue obligations under the collaboration
agreement; use of proceeds that may be obtained pursuant to the
collaboration agreement; plans of Transcept to exercise the option
to co-promote Intermezzo and to develop a specialty sales force;
the potential reduction of hypnotic sleep aid dosing through use of
Intermezzo ; the ability of Transcept to obtain and maintain patent
protection and regulatory exclusivity for Intermezzo ; the ability
of Transcept to achieve its goal of becoming an integrated
specialty pharmaceutical company; and financial guidance with
respect to research and development expenses and general and
administrative expenses. Transcept may not actually achieve the
plans, intentions or expectations disclosed in our forward-looking
statements and you should not place undue reliance on these
forward-looking statements. Actual results or events could differ
materially from the plans, intentions and expectations disclosed in
the forward-looking statements we make. Various important factors
could cause actual results or events to differ materially from the
forward-looking statements that Transcept makes, including risks
related to the following: the opinion of the FDA on the sufficiency
of the Intermezzo NDA to support marketing approval and exclusivity
under the Hatch-Waxman Act; a decision by Purdue to terminate the
Collaboration Agreement, even if the Intermezzo NDA is approved;
commercial acceptance of Intermezzo , if approved; competition for
Intermezzo , if approved; unforeseen expenses related to FDA
approval and the business of Transcept generally; dependence on
third parties to manufacture Intermezzo ; a decision by Purdue to
not devote sufficient time or resources to commercialization of
Intermezzo ; obtaining, maintaining and protecting the intellectual
property incorporated into Intermezzo ; other difficulties or
delays in the commercialization of Intermezzo , carrying out
activities or obtaining payments under the collaboration agreement
with Purdue and clinical development of, and obtaining regulatory
approval for, Transcept product candidates; the ability of
Transcept to expand it product candidate portfolio; and the ability
of Transcept to obtain additional funding, if needed, to support
its business activities. These and other risks are described in
greater detail in the "Risk Factors" section of Transcept periodic
reports filed with the SEC. Forward-looking statements do not
reflect the potential impact of any future in-licensing,
collaborations, acquisitions, mergers, dispositions, joint
ventures, or investments Transcept may enter into or make.
Transcept does not assume any obligation to update any
forward-looking statements, except as required by law. Transcept
Pharmaceuticals, Inc. Greg Mann Director of Corporate
Communications (510) 215-3567 The Ruth Group Investors / Media Sara
Ephraim Pellegrino / Janine McCargo (646) 536-7017 / 7033 FINANCIAL
TABLES FOLLOW Transcept Pharmaceuticals, Inc. Statements of
Operations (Unaudited) Three Months Ended Six Months Ended June 30,
June 30, ------------------ ---------------- 2009 2008 2009 2008
---- ---- ---- ---- Operating expenses: Research and development
$2,249,516 $2,780,834 $4,471,399 $6,391,429 General and
administrative 5,019,352 1,711,671 9,233,122 3,224,039 Merger
related transaction costs - - 2,223,860 - --- --- --------- ---
Total operating expenses 7,268,868 4,492,505 15,928,381 9,615,468
--------- --------- ---------- --------- Loss from operations
(7,268,868) (4,492,505) (15,928,381) (9,615,468) Interest income
97,197 212,055 184,932 548,239 Interest expense (5,266) (205,286)
(170,924) (442,128) Other income (expense), net 63,823 (22,242)
263,496 (70,957) Interest expense related to bridge loan warrants -
- - - --- --- --- --- Net loss (7,113,114) (4,507,978) (15,650,877)
(9,580,314) Deemed dividend - Series C convertible preferred
stockholders - - - - --- --- --- --- Loss attributable to common
stockholders $(7,113,114) $(4,507,978) $(15,650,877) $(9,580,314)
=========== =========== ============ =========== Basic and diluted
net loss per share $(0.54) $(12.09) $(1.42) $(26.16) ====== =======
====== ======= Weighted average common shares outstanding
13,070,211 372,849 11,047,881 366,226 ========== ======= ==========
======= Period From Inception (January 8, 2002) to June 30, 2009
---------------- Operating expenses: Research and development
$47,798,800 General and administrative 30,225,845 Merger related
transaction costs 4,190,623 --------- Total operating expenses
82,215,268 ---------- Loss from operations (82,215,268) Interest
income 4,016,988 Interest expense (2,536,571) Other income
(expense), net 507,736 Interest expense related to bridge loan
warrants (535,195) -------- Net loss (80,762,310) Deemed dividend -
Series C convertible preferred stockholders (457,874) -------- Loss
attributable to common stockholders $(81,220,184) ============
Basic and diluted net loss per share Weighted average common shares
outstanding Transcept Pharmaceuticals, Inc. Balance Sheets June 30,
December 31, -------- ------------ 2009 2008 ---- ---- Assets
(Unaudited) Current assets: Cash and cash equivalents $10,108,147
$4,431,505 Marketable securities 63,335,541 7,250,987 Prepaid and
other current assets 1,689,238 381,836 Restricted cash 200,000
200,000 ------- ------- Total current assets 75,332,926 12,264,328
Property and equipment, net 1,456,979 1,450,216 Goodwill 2,961,664
- Other assets 826,243 65,970 ------- ------ Total assets
$80,577,812 $13,780,514 =========== =========== Liabilities,
convertible preferred stock and stockholders' equity (net capital
deficiency) Current liabilities: Accounts payable $1,090,963
$575,269 Accrued liabilities 2,343,466 1,468,415 Assumed lease
liability, short- term portion 254,177 - Loan payable, short-term
portion 43,014 3,347,010 ------ --------- Total current liabilities
3,731,620 5,390,694 Warrant liability - 599,845 Deposit for stock
purchase 63,738 87,656 Deferred rent 91,780 77,044 Assumed lease
liability, long-term portion 571,899 - Loan payable, long-term
portion 147,687 169,636 ------- ------- Total liabilities 4,606,724
6,324,875 Convertible preferred stock: $0.001 par value; 7,593,091
shares authorized; 0 shares issued and outstanding at June 30,
2009; Series A - 60,212, Series B - 1,126,020, Series C - 2,838,091
and Series D - 3,325,647 shares issued and outstanding at December
31, 2008 - 71,036,951 Stockholders' equity (net capital
deficiency): Common stock, $0.001 par value; 100,000,000 shares
authorized; 13,075,401 and 454,676 shares issued and outstanding at
June 30, 2009 and December 31, 2008, respectively 13,075 455
Additional paid-in capital 156,647,439 1,503,841 Deficit
accumulated during the development stage (80,762,310) (65,111,433)
Accumulated other comprehensive income 72,884 25,825 ------ ------
Total stockholders' equity (net capital deficiency) 75,971,088
(63,581,312) ---------- ----------- Total liabilities, convertible
preferred stock and stockholders' equity (net capital deficiency)
$80,577,812 $13,780,514 =========== =========== DATASOURCE:
Transcept Pharmaceuticals, Inc. CONTACT: Greg Mann, Director of
Corporate Communications of Transcept Pharmaceuticals, Inc.,
+1-510-215-3567, ; or Investors, Sara Ephraim Pellegrino,
+1-646-536-7017, , or Media, Janine McCargo, +1-646-536-7033, ,
both of The Ruth Group for Transcept Pharmaceuticals, Inc. Web
Site: http://www.transcept.com/
Copyright