RICHMOND, Va., Oct. 30 /PRNewswire-FirstCall/ -- Insmed Inc.
(NASDAQ: INSM), a developer of follow-on biologics and
biopharmaceuticals, today reported results for the third quarter
and nine-months ended September 30, 2008. Recent Company Highlights
-- Follow-on Biologics Program -- Received approval from the United
Kingdom's Medicines and Healthcare products Regulatory Agency to
initiate a Phase I clinical study for the Company's second
follow-on biologic ("FOB") product candidate, INS-20. Insmed's
INS-20 is a pegylated recombinant form of human G-CSF, and an FOB
of the FDA-approved product Neulasta(R), which had U.S. sales of
approximately $2.4 billion in 2007. -- IPLEX(TM) -- Received $3.0
million in cost recovery revenue in the third quarter related to
the expanded access program ("EAP") for IPLEX(TM). The EAP in Italy
to treat patients with Amyotrophic Lateral Sclerosis ("ALS"), also
known as Lou Gehrig's Disease, currently includes 23 physicians and
over 100 subjects have enrolled; -- Announced the presentation of
clinical study results with Premacure demonstrating IPLEX(TM)
increased serum IGF-I levels into the normal range in significantly
premature infants. Premacure is developing IPLEX(TM) as a potential
treatment for Retinopathy of Prematurity ("ROP") via a Material
Transfer Agreement with Insmed. Based in part on the results of
this study, Premacure intends to initiate a phase II multicenter
trial in the ROP indication during the fourth quarter. "We continue
to execute on our business plan and efficiently advance each of our
key clinical programs," said Dr. Geoffrey Allan, President and CEO
of Insmed. "Our second FOB candidate, INS-20, has entered the
clinic, and demonstrates further that we have the potential to be
an initial entrant into the emerging U.S. FOB marketplace. In
addition, we are working closely with RBC Capital Markets, our
financial advisor, to aggressively pursue our strategic options for
partnering and funding." Revenues for the third quarter ended
September 30, 2008 were $4.1 million, up from $1.4 million for the
corresponding period in 2007. The increase was primarily
attributable to a $1.6 million increase in cost recovery revenue
from our EAP to treat patients with ALS in Italy and the grant
receipt of $1.0 million from the Muscular Dystrophy Association
supporting the IPLEX(TM) Phase 2 Myotonic Muscular Dystrophy
("MMD") trial. The net loss for the third quarter of 2008 was $2.2
million or $0.02 per share, compared with a net loss of $3.9
million or $0.03 per share in the third quarter of 2007. This $1.7
million reduction was primarily attributable to the $2.7 million
increase in revenues, which was offset by a $438,000 increase in
total expenses, a $434,000 increase in net interest expense and the
realization of a $54,000 non-cash loss on investments. The $438,000
increase in total expenses was due to a $395,000 increase in
research and development ("R&D expenses") and a $43,000
decrease in selling, general and administrative expenses ("SG&A
Expenses"). The higher R&D Expenses were due largely to
increased clinical trial activity in the current quarter compared
to last year as our phase 2 IPLEX(TM) MMD trial continues to
progress. SG&A Expenses were consistent quarter over quarter.
Interest income for the current quarter of $78,000 was $292,000
lower than the corresponding quarter of 2007 due to a combination
of the lower interest rate environment and a lower average cash
balance. Interest expense of $301,000 was $142,000 higher than the
same quarter in 2007 due to an increase in the debt discount
amortization resulting from the quarterly payment of our 2005
convertible notes, which began in March 2008. The loss on
investments arises from the write-down of our investment in Napo.
This investment, which was funded by a milestone payment from Napo,
was recorded as part of our agreement with Napo in 2007. For the
nine months ended September 30, 2008, revenues totaled $8.8
million, up from $5.3 million in the first nine months of 2007.
Consistent with the third quarter results, the increase was
primarily attributable to a $4.5 million improvement in cost
recovery from our EAP to treat patients with ALS in Italy and the
grant receipt of $1.0 million from the Muscular Dystrophy
Association supporting the IPLEX(TM) MMD trial. This was partially
offset by the absence of license income from Napo and the revenues
lost from our withdrawal of IPLEX(TM) in the short stature market
pursuant to the terms of our settlement agreement with Genentech
Inc. and Tercica Inc., entered into in 2007. The net loss for the
nine months ended September 30, 2008 was $11.7 million, or $0.10
per share, compared to $16.7 million, or $0.15 per share, for the
first nine months of 2007. Year-over-year, R&D Expenses
increased to $15.8 million for the first nine months of 2008, from
$14.4 million during the same period last year, reflecting an
overall increase in clinical trial activity for our FOB and
IPLEX(TM) programs. SG&A Expenses fell to $3.7 million for the
first nine months of 2008 from $7.4 million a year earlier due to
the elimination of litigation expenses following the March 2007
settlement and the removal of commercial expenses associated with
our business restructuring plan. Interest income for the first nine
months of 2008 of $453,000 was a reduction from the $895,000 earned
in the same period of 2007. Interest expense increased to $983,000
in the most recent nine month period from $465,000 during the
corresponding period of 2007. The same factors effecting the third
quarter interest movements impacted the year to date figures. The
$500,000 loss on investments represents the full write down of the
Napo investment during the first nine months of 2008. As of
September 30, 2008, we had total cash, cash equivalents and
short-term investments on hand of $5.8 million, compared to $16.5
million on hand as of December 31, 2007. The $10.7 million decrease
in cash, cash equivalents and short-term investments primarily
reflects the use of $9.1 million for operating activities and a
$1.7 million principal repayment of our 2005 convertible notes,
which began on March 1, 2008. Conference Call To participate in
today's 8:30 AM ET live conference call, please dial 866-831-6270
(U.S. callers) or 617-213-8858 (international callers), and provide
passcode 95924014. A live webcast of the call will also be
available at:
http://phx.corporate-ir.net/playerlink.zhtml?c=122332&s=wm&e=2000938
Please allow extra time prior to the webcast to register, download
and install any necessary audio software. The webcast will be
archived for 30 days, and a telephone replay of the call will be
available for seven days beginning today at 10:30 AM ET at
888-286-8010 (U.S. callers) or 617-801-6888 (international
callers), using passcode 69712597. About Insmed Insmed Inc. is a
biopharmaceutical company with unique protein process development
and manufacturing experience and a proprietary protein platform
aimed at niche markets with unmet medical needs. For more
information, please visit http://www.insmed.com/. Forward-Looking
Statements This release contains forward-looking statements which
are made pursuant to provisions of Section 21E of the Securities
Exchange Act of 1934. Investors are cautioned that such statements
in this release, including statements relating to planned clinical
study design, regulatory and business strategies, plans and
objectives of management and growth opportunities for existing or
proposed products, constitute forward-looking statements which
involve risks and uncertainties that could cause actual results to
differ materially from those anticipated by the forward-looking
statements. The risks and uncertainties include, without
limitation, risks that product candidates may fail in the clinic or
may not be successfully marketed or manufactured, the FOB market in
the United States may be slow to develop or never develop,
government regulation of the FOB market (in foreign countries and
possibly in the United States) could be onerous or slow in
developing or never develop, we may lack financial resources to
complete development of product candidates or to fund the ongoing
operations of the Company, the FDA may interpret the results of
studies differently than us, competing products may be more
successful, demand for new pharmaceutical products may decrease,
the biopharmaceutical industry may experience negative market
trends, our entrance into the FOB market may be unsuccessful, we
may be unable to secure an appropriate business partner for our
follow-on biologics business, our common stock could be delisted
from the Nasdaq Capital Market and other risks and challenges
detailed in our filings with the U.S. Securities and Exchange
Commission, including our Quarterly Report on Form 10-Q for the
quarter ended June 30, 2008 and our Annual Report on Form 10-K for
the year ended December 31, 2007. Readers are cautioned not to
place undue reliance on any forward-looking statements which speak
only as of the date of this release. We undertake 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 release or to
reflect the occurrence of unanticipated events. Investor Relations
Contact: Brian Ritchie - FD 212-850-5683 Corporate Communications
Contact: John Procter - Gibraltar Associates 202-879-5808 INSMED
INCORPORATED Consolidated Balance Sheets (in thousands, except
share and per share data) (unaudited) September 30, December 31,
2008 2007 Assets Current assets: Cash, cash equivalents and
short-term investments $5,771 $16,479 Accounts receivable, net 72
250 Prepaid expenses 118 244 Total current assets 5,961 16,973
Long-term assets: Restricted cash - long term 2,095 2,095
Investments - 258 Deferred financing costs, net 92 170 Property and
equipment, net - 4 Total long-term assets 2,187 2,527 Total assets
$8,148 $19,500 Liabilities and stockholders' equity Current
liabilities: Accounts payable $1,117 $904 Accrued project costs
& other 679 503 Payroll liabilities 633 631 Interest payable 15
23 Deferred rent 115 115 Deferred income 191 245 Convertible debt
2,211 2,211 Debt discount (584) (950) Net convertible debt 1,627
1,261 Total current liabilities 4,377 3,682 Long-term liabilities:
Convertible debt 1,106 2,764 Debt discount (286) (651) Net
long-term convertible debt 820 2,113 Asset retirement obligation
2,217 2,217 Total liabilities 7,414 8,012 Stockholders' equity:
Common stock; $.01 par value; authorized shares 500,000,000; issued
and outstanding shares, 122,315,635 in 2008 and 121,904,312 in 2007
1,223 1,219 Additional paid-in capital 341,973 341,270 Accumulated
deficit (342,462) (330,759) Accumulated other comprehensive loss:
Unrealized loss on investment - (242) Net stockholders' (deficit)
equity 734 11,488 Total liabilities and stockholders' equity $8,148
$19,500 INSMED INCORPORATED Consolidated Statements of Operations
(in thousands, except per share data - unaudited) Three Months
Ended Nine Months Ended September 30, September 30, 2008 2007 2008
2007 Sales, net $- $- $- $423 Royalties 29 28 83 80 License income
- - - 1,545 Grant revenue 1,044 - 1,044 - Other expanded access
program income 2,998 1,368 7,713 3,212 Total revenues 4,071 1,396
8,840 5,260 Operating expenses: Cost of goods sold - - - 576
Research and development 4,997 4,602 15,774 14,398 Selling, general
and administrative 960 917 3,739 7,381 Total expenses 5,957 5,519
19,513 22,355 Operating loss (1,886) (4,123) (10,673) (17,095)
Interest income 78 370 453 895 Interest expense (301) (159) (983)
(465) Loss on investments (54) - (500) - Net loss $(2,163) $(3,912)
$(11,703) $(16,665) Basic and diluted net loss per share $(0.02)
$(0.03) $(0.10) $(0.15) Shares used in computing basic and diluted
net loss per share 122,314 121,708 122,070 112,279 INSMED
INCORPORATED Consolidated Statements of Cash Flows (in thousands -
unaudited) Nine Months Ended September 30, 2008 2007 Operating
activities Net loss $(11,703) $(16,665) Adjustments to reconcile
net loss to net cash used in operating activities: Depreciation and
amortization 813 259 Stock based compensation expense 505 227 Stock
options issued for services 140 39 Realized loss on investments 500
- Changes in operating assets and liabilities: Accounts receivable
178 216 Inventory - 576 Other assets 126 (152) Accounts payable 213
(6,454) Accrued project costs 176 (514) Payroll liabilities 2 (18)
Deferred income (54) - Asset retirement obligation - 443 Interest
payable (8) - Net cash used in operating activities (9,112)
(22,043) Investing activities Decreases of short-term investments
9,428 4,090 Purchases of investments - (500) Net cash provided by
investing activities 9,428 3,590 Financing activities Proceeds from
issuance of common stock Public Offering - 18,230 Issuance costs -
(1,266) Other 62 83 Total proceeds from issuance of common stock 62
17,047 Costs incurred in conjunction with issuance of debt - -
Other - 297 Net cash (used in) provided by financing activities
(1,596) 17,344 Decrease in cash and cash equivalents (1,280)
(1,109) Cash and cash equivalents at beginning of period 3,554
2,121 Cash and cash equivalents at end of period $2,274 $ 1,012 The
table below details the "Cash and cash equivalents" from the
statement of cash flows to "Cash, cash equivalents and short-term
investments" shown on the balance sheet. September 30, December 31,
2008 2007 Cash and Cash Equivalents 2,274 3,554 Short-Term
Investments 3,497 12,925 Total Cash and Cash Equivalents and
Short-Term Investments 5,771 16,479 DATASOURCE: Insmed Inc.
CONTACT: Investor Relations, Brian Ritchie - FD, +1-212-850-5683, ,
or Corporate Communications, John Procter - Gibraltar Associates,
+1-202-879-5808, Web Site: http://www.insmed.com/
Copyright