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Advanced Life Sciences Announces 2008 Fourth Quarter and Full Year Financial Results
Date:2/11/2009

CHICAGO, Feb. 11 /PRNewswire-FirstCall/ -- Advanced Life Sciences Holdings, Inc. (Nasdaq: ADLS), a biopharmaceutical company engaged in the discovery, development and commercialization of novel drugs in the therapeutic areas of infection, cancer and respiratory diseases, today announced its financial results for the fourth quarter and full year ended December 31, 2008.

(Logo: http://www.newscom.com/cgi-bin/prnh/20080218/ALSLOGO)

The net loss allocable to common shareholders for the three months ended December 31, 2008 was $2.8 million or ($0.07) per share compared to a net loss allocable to common shareholders of $5.6 million or ($0.18) per share for the three months ended December 31, 2007. The net loss allocable to common shareholders for the full year 2008 was $23.0 million or ($0.59) per share compared to a net loss allocable to common shareholders of $32.5 million or ($1.12) per share for 2007. The decrease in the net loss for the full year 2008 is due to decreased costs involved in the clinical development of the Company's lead compound cethromycin.

The Company used approximately $12.2 million in cash in the fourth quarter of 2008 and ended the year with cash totaling $1.5 million. Cash use for the full year was $24.5 million. Fourth quarter and full year cash use included a $10.0 million milestone payment to Abbott Laboratories associated with the submission of the New Drug Application (NDA) for cethromycin.

"2008 was a transformative year in Advanced Life Sciences' history, marking our transition from a development-stage to a pre-commercial company, working toward the market launch of our first product," said Dr. Michael Flavin, Chairman and CEO of Advanced Life Sciences. "With the successful filing of our NDA for cethromycin, we have advanced our lead product candidate toward becoming a promising commercial product opportunity in a market that is in need of safe and effective new antibiotics. With the establishment of our Wyeth partnership in the Asia Pacific region, we have laid the cornerstone of our global commercialization strategy. In addition, the awarding of our multi- million dollar Defense Threat Reduction Agency (DTRA) contract is indicative of the potential for cethromycin and the significant market opportunity in the biodefense field."

Continued Dr. Flavin: "As we look forward to the July 31, 2009, PDUFA date set by FDA for cethromycin, we are realigning our resources and cost structure to focus on our upcoming commercial objectives and intend to raise capital to strengthen our financial position."

     Operating Expense Analysis: 2008 versus 2007:

     *    Research and development expense.  Total research and development
          expense decreased $10.0 million to approximately $15.7 million for
          the year ended December 31, 2008 from approximately $25.7 million
          for the year ended December 31, 2007.  The decrease in R&D expense
          is related to the conclusion of clinical trials and development
          costs associated with the Company's lead product, cethromycin.
     *    General and administrative expense.  General and administrative
          expense increased $0.3 million to $7.1 million for the year ended
          December 31, 2008.


     Fourth Quarter Expense Analysis: 2008 versus 2007:

     *    Research and development expense.  Total research and development
          expense decreased $3.1 million to approximately $0.9 million for the
          three months ended December 31, 2008 from approximately $4.0 million
          for the three months ended December 31, 2007. This decrease reflects
          a reduction in development expenses associated with the completion
          of clinical trials for cethromycin.
     *    General and administrative expense.  General and administrative
          expense increased $0.4 million to $1.9 million for the three months
          ended December 31, 2008.  This increase reflects costs incurred for
          pre-commercial activities.


     2008 Achievements

     *    The successful submission and filing of the NDA to the U.S. Food and
          Drug Administration (FDA) for cethromycin in the treatment of mild-
          to-moderate community acquired pneumonia (CAP);
     *    The signing of a development and commercialization agreement with
          Wyeth in the Asia Pacific region (excluding Japan), which includes a
          substantial up-front equity investment as well as milestones and
          payments based on successful achievement of clinical, regulatory and
          commercial objectives in specific markets that could potentially
          exceed $100 million;
     *    The awarding of a DTRA biodefense contract valued at up to $3.8
          million to fund the advanced development of cethromycin as a
          potential broad-spectrum medical countermeasure against bioterror
          agents such as tularemia, plague and melioidosis;
     *    Establishment of a strategic relationship with Inventiv Health to
          support pre-commercialization activities;
     *    The completion of a debt transaction increasing our bank line of
          credit from $4.0 million to $10.0 million to strengthen our balance
          sheet and help fund commitments associated with our cethromycin NDA
          submission and pre-commercialization activities;
     *    The implementation of a Standby Equity Distribution Agreement (SEDA)
          with YA Global Investments, L.P. for the sale of up to $15 million
          of shares of our common stock over a two-year period;
     *    The publication of a research article in the Journal of
          Antimicrobial Chemotherapy supporting the additional role for
          cethromycin as a potential treatment for infections caused by
          community associated methicillin resistant Staphylococcus aureus
          (CA-MRSA) as well as presentation of clinical and microbiological
          data in posters and an oral presentation pertaining to cethromycin
          at the 48th Annual ICAAC/IDSA Meeting.


     Cethromycin Objectives for 2009

     *    Advance discussions with prospective U.S. and E.U. partners for the
          commercialization of cethromycin;
     *    Initiate clinical trials with Wyeth in the Asia Pacific region in
          the moderate CAP patient population to support commercialization and
          build on our regulatory package;
     *    Continue supplemental NDA enabling studies of cethromycin as a broad
          spectrum biodefense countermeasure under the DTRA contract;
     *    Continue pre-launch activities including manufacturing, strategic
          marketing, medical education, pricing and reimbursement strategies.

Financial Guidance for 2009

Advanced Life Sciences expects its 2009 cash requirements, excluding milestone payments that become due upon cethromycin NDA approval, to fall in the range of $12.0 million and $15.0 million. Cash use in the first quarter of 2009 is expected to fall in the range of $1.5 million and $2.0 million. The cash use will be applied toward cethromycin NDA regulatory support, pre- commercial activities and general operating expenses.

As the Company transitions towards commercialization of cethromycin, the following initiatives are being undertaken to conserve capital and strengthen the balance sheet:

     *    In February, Advanced Life Sciences reduced its workforce by
          approximately 30% to focus resources on the cethromycin program.
          With these cost reductions, the Company will take a severance charge
          in the first quarter in the amount of $60,000.  The Company expects
          to save approximately $1.0 million annually due to this initiative;
     *    In addition to establishing commercial partnerships for cethromycin,
          the Company intends to raise capital through the sale of equity
          using its Stand-by Equity Distribution Agreement with YA Global
          Investments, L.P. and through the additional sale of equity.

Nasdaq Marketplace Rule 4350(b)(1)(B)

The Company's independent registered public accounting firm included an explanatory paragraph in its report on the Company's 2008 financial statements related to uncertainty in the Company's ability to continue as a going concern. We anticipate that our independent registered public accounting firm will include a similar opinion in its report on the Company's 2008 financial statements. There can be no assurance that it will be able to secure a commercial partnership or obtain adequate capital funding in the future to continue operations and implement its strategy, which would have an adverse effect on the Company's business and operations.

Conference Call Details

Advanced Life Sciences will host a conference call and live webcast at 10:00 a.m. Eastern Time on Wednesday, February 11, 2009 to discuss the Company's financial results for the fourth quarter and full year ended December 31, 2008.

The conference call will be webcast simultaneously over the Internet. Please visit the Investor Relations section of the Advanced Life Sciences corporate website http://www.advancedlifesciences.com. Alternatively, callers may participate in the conference call by dialing 888-680-0879 or 617-213-4856 (international). The passcode for the conference call is 25253515. A replay of the conference call will be available until February 18, 2009. Callers may access the telephone replay by dialing 888-286-8010 (domestic) or 617-801-6888 (international), passcode 89150902. Investors are advised to dial into the call at least ten minutes prior to the call to register. Participants may pre- register for the call at https://www.theconferencingservice.com/prereg/key.process?key=PNXL8438C. Pre- registrants will be issued a pin number to use when dialing into the live call which will provide quick access to the conference by bypassing the operator upon connection.

About Community Acquired Pneumonia (CAP)

CAP is the sixth most common cause of death in the United States. CAP and other respiratory tract infections are caused by pathogens such as Streptococcus pneumoniae and Haemophilus influenzae. Approximately 5.6 million cases of CAP are diagnosed each year in the United States with 10 million physician visits, resulting in an estimated total annual expenditure of $2.0 billion dollars for prescribed antibiotics to treat CAP. CAP is potentially fatal if not treated properly, and the bacteria that cause CAP are developing resistance to current standard of care treatments.

Macrolides and penicillins are currently the front-line treatments for respiratory tract infections such as CAP. As macrolide and penicillin resistance grows and has the potential to cause more clinical failures, there is a need for new antibiotics with unique mechanisms of action that can overcome this emerging resistance.

About Cethromycin

Cethromycin has shown higher in vitro potency and a broader range of activity than macrolides against Gram-positive bacteria associated with respiratory tract infections, and, again in in vitro tests, it appears to be effective against penicillin- and macrolide-resistant bacteria. Cethromycin has a mechanism of action that may slow the onset of future bacterial resistance. In addition to its utility in CAP, cethromycin is also being investigated for the prophylactic treatment of inhalation anthrax post- exposure. The FDA has designated cethromycin as an orphan drug for the prophylactic treatment of inhalation anthrax post exposure, but the drug is not yet approved for this or any other indication.

About Advanced Life Sciences

Advanced Life Sciences is a biopharmaceutical company engaged in the discovery, development and commercialization of novel drugs in the therapeutic areas of infection, cancer and inflammation. The Company's lead candidate, cethromycin, is a novel once-a-day oral antibiotic under review by the FDA for the treatment of mild-to-moderate community acquired pneumonia. For more information, please visit us on the web at http://www.advancedlifesciences.com.

Forward-Looking Statements

Any statements contained in this press release that relate to future plans, events or performance are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements represent our management's judgment regarding future events. The Company does not undertake any obligations to update any forward-looking statements whether as a result of new information, future events or otherwise. Our actual results could differ materially from those discussed herein due to several factors including the success and timing of our clinical trials and our ability to obtain and maintain regulatory approval and labeling of our product candidates; our plans to develop and commercialize our product candidates; the loss of key scientific or management personnel; the size and growth of potential markets for our product candidates and our ability to serve those markets; regulatory developments in the U.S. and foreign countries; the rate and degree of market acceptance of any future products; the accuracy of our estimates regarding expenses, future revenues and capital requirements; our ability to obtain financing on terms acceptable to us; our ability to obtain and maintain intellectual property protection for our product candidates; the successful development of our sales and marketing capabilities; the success of competing drugs that become available; and the performance of third party collaborators and manufacturers. These and additional risks and uncertainties are detailed in the Company's filings with the Securities and Exchange Commission.



    ADVANCED LIFE SCIENCES HOLDINGS, INC. AND SUBSIDIARY
    (A Development Stage Company)

    CONSOLIDATED STATEMENTS OF OPERATIONS

                                               Three months ended December 31,
                                                    2008              2007
    Revenue:
      Management fees                                   $-                $-
      Grants                                       208,824                 -
      Royalty-related party                              -                 -

               Total revenue                       208,824                 -

    Expenses:
      Research and development                     911,120         4,013,585
      Contracted research and development-related
       party                                             -                 -
      Selling, general and administrative        1,878,971         1,476,806

               Total expenses                    2,790,091         5,490,391


    Loss from operations                        (2,581,267)       (5,490,391)

    Net other (income) expense:
      Interest income                              (22,517)          (79,488)
      Interest expense                             215,407           116,695
      Gain on sale of interest in Sarawak
       Medichem Pharmaceuticals joint venture            -                 -

    Net other (income) expense                     192,890            37,207

    Net loss                                    (2,774,157)       (5,527,598)

    Less accumulated preferred stock dividends
     for the period                                 43,750            43,750

    Net loss available to common shareholders  $(2,817,907)      $(5,571,348)

    Net loss per share available to common
     shareholders - basic and diluted               $(0.07)           $(0.18)


    Weighted average shares outstanding -
     basic and diluted                          40,808,378        30,743,566



                                                                 Period From
                                                                  Inception
                                                                  (January 1,
                                                                     1999)
                                          Twelve months ended       Through
                                              December 31,        December 31,
                                           2008          2007         2008
    Revenue:
      Management fees                         $-            $-     $1,161,180
      Grants                             240,830             -      1,276,401
      Royalty-related party                    -             -         45,238

               Total revenue             240,830             -      2,482,819

    Expenses:
      Research and development        15,709,293    25,735,759     90,580,401
      Contracted research and
       development-related party               -             -      7,980,299
      Selling, general and
       administrative                  7,116,549     6,839,575     27,048,637

               Total expenses         22,825,842    32,575,334    125,609,337


    Loss from operations             (22,585,012)  (32,575,334)  (123,126,518)

    Net other (income) expense:
      Interest income                   (306,846)     (717,884)    (2,948,862)
      Interest expense                   525,703       466,963      3,148,853
      Gain on sale of interest in
       Sarawak Medichem
       Pharmaceuticals joint venture           -             -       (939,052)

    Net other (income) expense           218,857      (250,921)      (739,061)

    Net loss                         (22,803,869)  (32,324,413)  (122,387,457)

    Less accumulated preferred stock
     dividends for the period            175,000       175,000      1,669,792

    Net loss available to common
     shareholders                   $(22,978,869) $(32,499,413) $(124,057,249)

    Net loss per share available to
     common shareholders - basic
     and diluted                          $(0.59)       $(1.12)


    Weighted average shares
     outstanding - basic and
     diluted                          39,098,943    28,910,041



    ADVANCED LIFE SCIENCES HOLDINGS, INC. AND SUBSIDIARY
    (A Development Stage Company)
                                                December 31,     December 31,
    CONSOLIDATED BALANCE SHEETS                     2008             2007
    (Unaudited)

    ASSETS

    CURRENT ASSETS:
      Cash and cash equivalents                  $1,527,108       $18,324,991
      Grant receivable                               63,444                 -
      Prepaid insurance                             227,313           251,493
      Prepaid clinical trial expenses                     -           926,168
      Other prepaid expenses and deposits           143,808           140,359

               Total current assets               1,961,673        19,643,011

    PROPERTY AND EQUIPMENT:
      Furniture and fixtures                        244,072           221,417
      Laboratory equipment                          159,186           159,186
      Computer software and equipment               258,786           242,707
      Leasehold improvements                        505,804           177,253

               Total property and equipment-at
                cost                              1,167,848           800,563
      Less accumulated depreciation                (760,329)         (542,032)

               Property and equipment-net           407,519           258,531

    OTHER ASSETS:
       Deferred offering and financing costs        450,861                 -
       Other long-term assets                             -            10,000

               Total other assets                   450,861            10,000

    TOTAL ASSETS                                 $2,820,053       $19,911,542

    LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

    CURRENT LIABILITIES:
      Accounts payable                           $1,379,941        $2,685,751
      Accrued clinical trial and NDA expenses       458,260         2,776,543
      Accrued payroll                               506,537            68,094
      Other accrued expenses                        352,466           262,347
      Accrued interest payable                       72,572            22,756
      Short-term lease payable                        8,468             7,259

               Total current liabilities          2,778,244         5,822,750

    Long-term lease payable                           4,350            12,818
    Long-term grant payable                         500,000           500,000
    Long-term notes payable - related party       2,000,000         2,000,000
    Line of credit                                9,915,000         3,915,000

               Total liabilities                 15,197,594        12,250,568

    COMMITMENTS AND CONTINGENCIES

    MINORITY INTEREST                                     -                 -

    STOCKHOLDERS' EQUITY (DEFICIT):
      Common stock, $0.01 par value -
       60,000,000 shares authorized;
        40,810,932 issued and outstanding
         at December 31, 2008; 38,502,987
         shares issued and outstanding at
         December 31, 2007                          408,109           385,030
      Additional paid-in capital                109,601,807       106,859,532
      Deficit accumulated during the
       development stage                       (122,387,457)      (99,583,588)

               Total stockholders' equity
                (deficit)                       (12,377,541)        7,660,974

    TOTAL LIABILITIES AND STOCKHOLDERS'
     EQUITY (DEFICIT)                            $2,820,053       $19,911,542

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SOURCE Advanced Life Sciences Holdings, Inc.
Copyright©2009 PR Newswire.
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