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Palatin Technologies, Inc. Reports Fourth Quarter and Fiscal Year End 2007 Results; Teleconference and Webcast to be held on September 18, 2007

CRANBURY, N.J., Sept. 14 /PRNewswire-FirstCall/ -- Palatin Technologies, Inc. (Amex: PTN) announced today results for its fourth quarter and fiscal year ended June 30, 2007. Palatin reported a net loss of $6.1 million, or ($0.07) per basic and diluted share, for the quarter ended June 30, 2007, compared to a net loss of $7.9 million, or ($0.11) per basic and diluted share, for the same period in 2006. Total revenues in the quarter ended June 30, 2007 were $2.6 million, compared to $5.0 million for the same period in 2006. As of June 30, 2007, the Company had cash, cash equivalents and investments totaling $33.8 million.

The decrease in the net loss for the quarter ended June 30, 2007 versus the quarter ended June 30, 2006 was primarily attributable to decreased research and development spending on bremelanotide, the Company's drug under development for the treatment of erectile dysfunction (ED) and female sexual dysfunction (FSD). Cost reimbursement revenue from King Pharmaceuticals, Inc. (King) also decreased as a result of the lower spending.

For the years ended June 30, 2007 and 2006, total revenues were $14.4 million and $19.7 million, respectively. Palatin's net loss for the year ended June 30, 2007 was $27.8 million, or ($0.36) per basic and diluted share, compared to a net loss of $29.0 million, or ($0.48) per basic and diluted share, for the year ended June 30, 2006.


Significant developments in Palatin's business since June 30, 2006 include the following:

-- The announcement of results of Part 2 of a Phase 2A pilot study

evaluating the effects of bremelanotide in post-menopausal women

diagnosed with FSD in which subjects reported an increased level of

genital arousal, an increased level of sexual desire and a higher

incidence of engaging in sexual activity compared to placebo.

-- The announcement of results from two Phase 2B trials evaluating

bremelanotide for ED, with one trial limited to non-diabetic patients

and the other to diabetic patients. The primary objective of the

studies was to characterize the efficacy and safety of bremelanotide in

these two ED populations and to identify the doses to use in further


-- The completion of an exclusive global licensing and research

collaboration agreement with AstraZeneca AB to discover, develop and

commercialize small molecule compounds that target melanocortin

receptors for the treatment of obesity, diabetes and related metabolic

syndrome and the receipt of an up-front payment of $10 million.

-- The February 2007 sale of 13.75 million shares of its common stock in

an underwritten offering at $2.00 per share, resulting in net proceeds

to the Company of $25.5 million, after commissions and expenses.

-- The announcement in August 2007 of a delay in plans for the initiation

of Phase 3 clinical trials with bremelanotide for the treatment of ED

as a result of responses from representatives of the U.S. Food and Drug

Administration, which raised serious concerns about the acceptable

benefit/risk ratio to support the progression of bremelanotide into

Phase 3 studies for ED as a first-line therapy in the general


-- The pending termination of the Collaborative Development and Marketing

Agreement with King, effective December 2007, upon which Palatin will

reacquire sole ownership of all rights to bremelanotide, without any

obligation for future payments to King. King has no financial

obligation for future payments to Palatin, other than for previously

incurred costs not yet reimbursed and approved expense reimbursements

related to the wind-down of the collaboration.

-- Advancement of a lead compound through the preclinical stages resulting

in the anticipated filing of an Investigational New Drug Application

for a synthetic compound that mimics natriuretic peptides for the

treatment of patients with congestive heart failure in the second half

of calendar year 2007.

-- The completion of an exploratory at-home Phase 2B clinical trial in

pre- and postmenopausal women. We are in the final stages of compiling

the data and anticipate releasing the results of this trial later this



For the quarter ended June 30, 2007, Palatin recognized revenue under its collaboration agreement with King of $1.8 million, which includes King's share of bremelanotide development costs, and $0.7 million of contract revenue related to its February 2007 collaboration with AstraZeneca. In the comparable quarter of 2006, Palatin recognized $4.9 million of contract revenue from King, reflecting significantly higher cost reimbursement revenue resulting from Palatin's clinical study activities.


Total operating expenses for the quarter ended June 30, 2007 were $9.1 million versus $13.2 million for the comparable quarter of 2006, reflecting lower development costs of bremelanotide following the completion of two Phase 2B clinical trials in patients with ED, which were partially offset by other research and development spending and higher stock-based compensation charges.


Palatin's cash, cash equivalents and investments totaled $33.8 million as of June 30, 2007, compared to $30.7 million at June 30, 2006, as current year operating expenses were largely offset by net proceeds from the February 2007 stock offering and the receipt of $10 million from AstraZeneca upon the signing of the companies' research collaboration and license agreement.

Palatin Technologies' management will discuss the fourth quarter and year end financial results for the fiscal year ended June 30, 2007 and provide an update on corporate developments during a conference call and webcast on September 18, 2007 at 10:00 a.m. ET.

Conference Call and Webcast Access Information

-- Q4-Fiscal Year 2007 Conference Call - Live 9/18/2007 at 10:00 a.m. ET

Domestic Dial-In Number 1-866-454-4203

International Dial-In Number 1-913-312-6693

-- Q4-Fiscal Year 2007 Conference Call - Replay 9/18-9/25/2007

Domestic Dial-In Number 1-888-203-1112

International Dial-In Number 1-719-457-0820

Enter Pass Code I.D. # 4280242

-- Webcast Live and Replay Access

The webcast and replay can be accessed by logging on to the investors

section of Palatin Technologies' website at

About Palatin Technologies, Inc.

Palatin Technologies, Inc. is a biopharmaceutical company focused on discovering and developing targeted, receptor-specific small molecule and peptide therapeutics. The Company's internal research and development capabilities, anchored by its proprietary MIDAS(TM) technology, are fueling product development. Palatin's strategy is to develop products and then form marketing collaborations with industry leaders in order to maximize their commercial potential. The Company currently has collaborations with AstraZeneca and the Mallinckrodt division of Covidien. For additional information regarding Palatin, please visit Palatin Technologies' website at

Forward-looking Statements

Statements about the Company's future expectations, including statements about its development programs, proposed indications for its product candidates, pre-clinical activities, marketing collaborations, and all other statements in this document other than historical facts, are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and as that term is defined in the Private Securities Litigation Reform Act of 1995. The Company intends that such forward-looking statements shall be subject to the safe harbors created thereby. Palatin's actual results may differ materially from those discussed in the forward-looking statements for various reasons, including, but not limited to the Company's ability to fund development of its technology, ability to establish and successfully complete clinical trials and pre-clinical studies and the results of those trials and studies, dependence on its partners for certain development activities, need for regulatory approvals and commercial acceptance of its products, ability to recommence marketing and gain commercial acceptance of NeutroSpec(R), ability to protect its intellectual property, and other factors discussed in the Company's periodic filings with the Securities and Exchange Commission. The Company is not responsible for updating for events that occur after the date of this press release.


Consolidated Statement of Operations Data

Year Ended June 30,

2007 2006 2005


Licenses, grants and contracts $14,405,665 $18,239,783 $13,896,818

Royalties - 1,508,862 1,586,050

Product sales - - 2,474,325

Total revenues 14,405,665 19,748,645 17,957,193


Cost of product sales - 2,041,175 534,932

Royalties - 299,995 328,401

Research and development 36,913,739 41,013,894 25,045,279

General and administrative 7,293,091 6,843,817 7,460,607

Total operating expenses 44,206,830 50,198,881 33,369,219

Loss from operations (29,801,165) (30,450,236) (15,412,026)


Investment income 1,324,671 855,601 488,262

Interest expense (53,339) (30,522) (14,487)

Total other income, net 1,271,332 825,079 473,775

Loss before income taxes (28,529,833) (29,625,157) (14,938,251)

Income tax benefit 778,308 666,275 580,275

NET LOSS $(27,751,525) $(28,958,882) $(14,357,976)

Basic and diluted net loss

per common share $(0.36) $(0.48) $(0.27)

Weighted average number of

common shares outstanding

used in computing basic and

diluted net loss per common

share 76,204,160 60,356,610 53,861,182


Consolidated Balance Sheet Data

June 30, 2007 June 30, 2006


Current assets:

Cash and cash equivalents $31,447,615 $28,333,211

Available-for-sale investments 2,323,642 2,330,834

Accounts receivable 607,841 69,591

Prepaid expenses and other current assets 1,008,464 1,453,650

Total current assets 35,387,562 32,187,286

Property and equipment, net 6,070,226 6,347,705

Restricted cash 475,000 475,000

Other assets 848,446 1,037,296

Total assets $42,781,234 $40,047,287


Current liabilities:

Capital lease obligations and notes payable,

current portion $216,841 $86,564

Accounts payable 1,120,894 3,092,962

Accrued expenses 2,420,837 4,466,428

Accrued compensation 941,300 803,900

Deferred revenue, current portion 4,864,833 3,995,575

Total current liabilities 9,564,705 12,445,429

Capital lease obligations and notes payable,

net of current portion 275,126 229,585

Deferred rent, net of current portion 1,966,628 2,358,550

Deferred revenue, net of current portion 12,443,087 6,713,942

Total liabilities 24,249,546 21,747,506

Commitments and contingencies

Stockholders' equity:

Preferred stock of $.01 par value -

authorized 10,000,000 shares; Series A

Convertible; issued and outstanding 4,997

and 9,997 shares as of June 30, 2007 and

2006, respectively 50 100

Common stock of $.01 par value - authorized

150,000,000 shares; issued and outstanding

85,126,915 and 70,878,521 shares as of

June 30, 2007 and 2006, respectively 851,269 708,785

Additional paid-in capital 205,875,438 178,089,176

Accumulated other comprehensive loss - (54,736)

Accumulated deficit (188,195,069) (160,443,544)

Total stockholders' equity 18,531,688 18,299,781

Total liabilities and stockholders'

equity $42,781,234 $40,047,287

SOURCE Palatin Technologies, Inc.
Copyright©2007 PR Newswire.
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