RICHMOND, Va., Nov. 6 /PRNewswire-FirstCall/ -- Insmed Inc.
(NASDAQ: INSM), a biopharmaceutical company, today reported results
for the third quarter and nine-months ended September 30, 2009.
Revenues for the third quarter ended September 30, 2009 were $2.5
million, as compared to $4.1 million for the corresponding period
in 2008. The decrease was primarily attributable to $1.0 million of
grant revenue related to the IPLEX(TM) myotonic muscular dystrophy
("MMD") clinical trial recorded in the third quarter of 2008 and a
reduction of $0.5 million in cost recovery from our IPLEX(TM)
Expanded Access Program ("EAP") for Amyotrophic Lateral Sclerosis
("ALS") in Europe. The reduction in cost recovery from the EAP is
largely due to the determination made by Insmed in the third
quarter that its limited IPLEX(TM) inventory on hand should be
conserved for the treatment of existing ALS patients. The net loss
for the third quarter of 2009 was $150,000; break even on a dollar
per share basis, compared with a net loss of $2.2 million, or $0.02
per share, in the third quarter of 2008. This $2.0 million decrease
was primarily attributable to a $2.7 million decrease in total
expenses, a $0.6 million improvement in investment income and a
$0.2 million reduction in interest expense, which was partially
offset by the $1.6 million reduction in total revenues. The $2.7
million decrease in total expenses was due primarily to a $3.8
million decrease in research and development expenses ("R&D
Expenses"), which was partially offset by a $1.1 million increase
in selling, general and administrative expenses ("SG&A
Expenses"). The lower R&D expenses reflected the elimination of
manufacturing expenses following the sale of our follow-on
biologics ("FOB") assets in March 2009, while the higher SG&A
expenses were principally due to external finance, legal and
consulting advisory services associated with the ongoing strategic
review. The improvement in investment returns resulted from the
increased amount of cash available for investment, and the lower
interest expense was due to the reduction of the debt discount
amortization associated with our 2005 convertible notes. For the
nine months ended September 30, 2009, revenues totaled $7.9 million
as compared to $8.8 million in the first nine months of 2008.
Consistent with third quarter results, the decrease was primarily
attributable to a year-over-year decrease of $0.5 million in grant
revenue related to the IPLEX(TM) MMD clinical trial, and a
reduction of $0.5 million in cost recovery during the most recent
period from our IPLEX(TM) EAP in Europe. Net income for the nine
months ended September 30, 2009 was $116.0 million, or $0.92 per
share, compared to a net loss of $11.7 million, or $0.10 per share,
for first nine months of 2008. This $127.7 million improvement was
primarily due to the $127.8 million before tax gain on sale of our
FOB assets to Merck, combined with a $2.6 million decrease in total
expenses, a $0.4 million improvement in investment returns, a $0.3
million reduction in interest expense and the absence of a $0.5
million loss on investments, which was offset by $2.8 million of
income tax expense on the gain on sale and a $1.0 million reduction
in net revenue. The $2.6 million decrease in total expenses was due
to a $7.3 million reduction in R&D expenses, which was
partially offset by a $4.7 million increase in SG&A expenses.
The $7.3 million reduction in R&D expenses was due primarily to
a decrease in manufacturing expenses following the sale of our FOB
assets in March 2009. The $4.7 million increase in SG&A
expenses was due largely to a combination of the recognition of
stock compensation expense for the restricted stock and restricted
stock units that vested on March 31, 2009, and the award of
bonuses, together with the increased finance, legal and consulting
fees related to the ongoing strategic review; as previously
mentioned. The $0.5 million reduction in investment loss was due to
the write off of the NAPO investment, which occurred in 2008. "We
are continuing our strategic review of alternatives with the
assistance of our financial advisors, RBC Capital Markets, and have
reviewed a number of high-quality opportunities," said Dr. Melvin
Sharoky, Insmed's Chairman. "We remain focused on leveraging our
strong balance sheet to grow our business and enhance shareholder
value." As of September 30, 2009, Insmed had total cash, cash
equivalents, short-term investments, and certificate of deposits on
hand totaling $124.1 million, consisting of $122.0 million in cash
and short term investments and $2.1 million in a certificate of
deposit, as compared to $2.4 million of cash on hand as of December
31, 2008. The $121.7 million increase in total cash was due to the
$127.8 million in before tax proceeds from the sale of Insmed's FOB
assets to Merck, $4.1 million from the conversion of warrants and
options into common stock, the release of a $2.1 million previously
restricted certificate of deposit and $0.5 million from securities,
which was partially offset by $11.8 million utilized to fund
operations and $1.0 million for the partial repayment of the
Company's 2005 convertible notes. Conference Call To participate in
today's 8:30 AM ET conference call, please dial 800-573-4754 (U.S.
callers) or 617-224-4325 (international), and provide passcode
14720373. A live webcast of the call will also be available at:
http://phx.corporate-ir.net/playerlink.zhtml?c=122332&s=wm&e=2498647.
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 at 11:30 AM ET today at
888-286-8010 (U.S. callers) or 617-801-6888 (international), using
passcode 92577797. About Insmed Insmed Inc. is a biopharmaceutical
company with unique protein development 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 business strategies, plans and
objectives of management and our strategic review process,
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, we may be
unsuccessful in identifying or reaching agreement with acquisition
or merger candidates, our expenses may be higher than anticipated
and other risks and challenges detailed in our filings with the
U.S. Securities and Exchange Commission, including our Annual
Report on Form 10-K for the year ended December 31, 2008. 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 Media
Relations Contact: Irma Gomez-Dib - FD 212-850-5761 INSMED
INCORPORATED Consolidated Balance Sheets (in thousands, except
share and per share data) (unaudited) September 30, December 31,
2009 2008 ---- ---- Assets Current assets: Cash, cash equivalents
and short-term investments $121,982 $2,397 Accounts receivable, net
319 122 Prepaid expenses 236 74 --- -- Total current assets 122,537
2,593 Long-term assets: Certificate of deposit 2,085 - Restricted
cash, long-term - 2,095 Deferred financing costs, net 7 70 -- --
Total long-term assets 2,092 2,165 ----- ----- Total assets
$124,629 $4,758 ======== ====== Liabilities and stockholders'
equity (deficit) Current liabilities: Accounts payable $581 $1,277
Accrued project costs & other 1,224 936 Payroll liabilities 421
453 Income taxes payable 625 - Restricted stock unit liability -
113 Interest payable 2 13 Deferred rent 103 168 Deferred revenue
231 302 Convertible debt 461 2,211 Debt discount (64) (596) ---
---- Net convertible debt 397 1,615 --- ----- Total current
liabilities 3,584 4,877 Long-term liabilities: Convertible debt -
553 Debt discount - (66) ---- ----- Net long-term convertible debt
- 487 Asset retirement obligation - 2,217 ---- ----- Total
liabilities 3,584 7,581 ----- ----- Stockholders' equity (deficit):
Common stock; $.01 par value; authorized shares 500,000,000; issued
and outstanding shares, 130,208,099 in 2009 and 122,494,010 in 2008
1,302 1,225 Additional paid-in capital 350,125 342,378 Accumulated
deficit (230,382) (346,426) --------- -------- Net stockholders'
equity (deficit) 121,045 (2,823) ------- ------- Total liabilities
and stockholders' equity (deficit) $124,629 $4,758 ======== ======
INSMED INCORPORATED Consolidated Statements of Operations (in
thousands, except per share data - unaudited) Three Months Ended
Nine Months Ended September 30, September 30, -------------
------------- 2009 2008 2009 2008 ---- ---- ---- ---- Royalties $21
$29 $79 $83 Grant revenue - 1,044 544 1,044 Other expanded access
program income, net 2,454 2,998 7,262 7,713 ----- ----- ----- -----
Total revenues 2,475 4,071 7,885 8,840 Operating expenses: Research
and development 1,143 4,997 8,483 15,774 Selling, general and
administrative 2,096 960 8,419 3,739 ----- --- ----- ----- Total
expenses 3,239 5,957 16,902 19,513 ----- ----- ------ ------
Operating loss (764) (1,886) (9,017) (10,673) Investment income 682
78 817 453 Realized loss on investments - (54) - (500) Interest
expense (68) (301) (730) (983) Gain on sale of asset, net - -
127,768 - ----- ----- ------ ------ Income (loss) before taxes
(150) (2,163) 118,838 (11,703) Income tax expense - - 2,794 - -----
----- ------ ------ Net income (loss) $(150) $(2,163) $116,044
$(11,703) ====== ======= ======== ======== Basic net income (loss)
per share $(0.00) $(0.02) $0.92 $(0.10) ====== ====== ===== ======
Shares used in computing basic net profit (loss) per share 129,442
122,314 126,072 122,070 ======= ======= ======= ======= Diluted net
income (loss) per share $(0.00) $(0.02) $0.92 $(0.10) ====== ======
===== ====== Shares used in computing diluted net profit (loss) per
share 129,442 122,314 126,256 122,070 ======= ======= =======
======= INSMED INCORPORATED Consolidated Statements of Cash Flows
(in thousands - unaudited) Nine Months Ended September 30, 2009
2008 ---- ---- Operating activities Net income (loss) $116,044
$(11,703) Adjustments to reconcile net income (loss) to net cash
used in operating activities: Depreciation and amortization 661 813
Stock based compensation expense 2,425 505 Gain on sale of asset,
net (127,768) - Stock options issued for services - 140 Change in
trading securities (498) - Realized loss on investments - 500
Changes in operating assets and liabilities: Accounts receivable
(197) 178 Other assets (162) 126 Accounts payable (696) 213 Accrued
project costs & other 288 176 Payroll liabilities (32) 2 Income
tax liability 625 - Deferred rent (65) - Deferred income (71) (54)
Restricted stock unit liability (113) - Asset retirement obligation
(2,217) - Interest payable (11) (8) --- -- Net cash used in
operating activities (11,787) (9,112) ------- ------- Investing
activities Cash received from asset sale 127,768 - Change in
certificate of deposits 10 - Purchases of short-term investments
(94,646) 9,428 ------- ----- Net cash provided by investing
activities 33,132 9,428 ------ ----- Financing activities Proceeds
from issuance of common stock 580 - Repayment of convertible notes
(1,016) (1,658) Warrants converted into shares 3,493 - Other 39 62
------ ----- Net cash provided by (used in) financing activities
3,096 (1,596) ----- ------- Increase (decrease) in cash and cash
equivalents 24,441 (1,280) Cash and cash equivalents at beginning
of period 2,397 3,554 ----- ----- Cash and cash equivalents at end
of period $26,838 $2,274 ======= ====== Supplemental information
Cash paid for interest $10 $182 DATASOURCE: Insmed Inc. CONTACT:
Investor Relations Contact: Brian Ritchie, FD, +1-212-850-5683, ,
Media Relations Contact: Irma Gomez-Dib, FD, +1-212-850-5761, Web
Site: http://www.insmed.com/
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