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Jazz Pharmaceuticals, Inc. Announces First Quarter 2009 Financial Results

- 1Q09 Xyrem(R) net sales of $18 million are 56% higher than 1Q08

- 1Q09 operating expenses of $29 million are 50% lower than 1Q08

PALO ALTO, Calif., May 7 /PRNewswire-FirstCall/ -- Jazz Pharmaceuticals, Inc. (Nasdaq: JAZZ) today announced financial results for the quarter ended March 31, 2009. Total revenues for the first quarter of 2009 were $22.1 million, compared to $14.6 million for the first quarter of 2008. Xyrem(R) (sodium oxybate) oral solution net sales for the first quarter of 2009 were $17.7 million, an increase of 56% over net sales of $11.3 million for the first quarter of 2008. This increase reflects the effect of significant price increases over the past twelve months and sales volume growth. Net sales of once-daily Luvox CR(R) (fluvoxamine maleate) Extended Release Capsules were $3.6 million for the first quarter of 2009.

Jazz Pharmaceuticals' cash and cash equivalents as of March 31, 2009 were $17.0 million. On March 31, 2009, Jazz Pharmaceuticals did not pay $5.1 million in interest due to the holders of the $119.5 million principal amount of its senior secured notes due June 2011, and Jazz Pharmaceuticals remains in default on the notes. The total overdue interest due on the notes through March 31, 2009 is $9.6 million.

"Our focus for the remainder of 2009 will be on increasing sales of our commercial products for their approved indications and submitting the NDA (New Drug Application) for JZP-6, our sodium oxybate product currently in Phase III clinical trials for the treatment of fibromyalgia," said Bruce Cozadd, Chairman and Chief Executive Officer. "We are pleased to report that we have completed the second pivotal trial for JZP-6 and expect to announce the results in mid-2009. We remain on track to submit our NDA for JZP-6 by the end of the year," he continued.

Research and development expenses for the first quarter of 2009 were $11.4 million, compared to $21.2 million for the first quarter of 2008. Reduced expenses in the first quarter of 2009 reflect Jazz Pharmaceuticals' decision that its JZP-4, JZP7, and JZP-8 programs will continue to the next phase of development only upon partnering or other funding for the programs.

Selling, general and administrative expenses for the first quarter of 2009 were $14.2 million, compared to $32.8 million for the first quarter of 2008. The decrease in the first quarter of 2009 reflects a decrease in spending on Luvox CR and the 2008 reductions in force.

Jazz Pharmaceuticals' net loss for the first quarter of 2009 was $13.0 million, compared to a net loss of $46.7 million for the first quarter of 2008.

About Jazz Pharmaceuticals, Inc.

Jazz Pharmaceuticals is a specialty pharmaceutical company focused on identifying, developing and commercializing innovative products to meet unmet medical needs in neurology and psychiatry. For further information see

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995

This press release contains forward-looking statements, including, but not limited to, statements related to future product sales, the results of the second pivotal trial for JZP-6 and the timing thereof, the planned submission of an NDA and the timing thereof, and potential partnering arrangements for certain of the company's programs. These forward-looking statements are based on the company's current expectations and inherently involve significant risks and uncertainties. Jazz Pharmaceuticals' actual results and the timing of events could differ materially from those anticipated in such forward looking statements as a result of these risks and uncertainties, which include, without limitation, risks related to the company's default on its senior secured notes, the right of the note holders to accelerate the obligations at any time, the company's potential need to seek protection under the provisions of the U.S. Bankruptcy Code in the event of an acceleration of the senior secured notes or otherwise and the resulting risk to the stockholders' receipt of any value for their shares; the company's need to raise additional funds; product sales and revenues; and the results of clinical trials. These and other risk factors are discussed under "Risk Factors" in the Quarterly Report on Form 10-Q for the quarter ended March 31, 2009 filed by Jazz Pharmaceuticals with the Securities and Exchange Commission on May 7, 2009. Jazz Pharmaceuticals undertakes no duty or obligation to update any forward-looking statements contained in this release as a result of new information, future events or changes in its expectations.

                         JAZZ PHARMACEUTICALS, INC.
                  (In thousands, except per share amounts)

                                                        Three Months
                                                       Ended March 31,
                                                        2009      2008
                                                        ----      ----
       Product sales, net                            $21,319   $13,984
       Royalties, net                                    472       365
       Contract revenues                                 285       285
                                                         ---       ---
         Total revenues                               22,076    14,634

     Operating expenses:
       Cost of product sales                           1,943     2,298
       Research and development                       11,408    21,243
       Selling, general and administrative            14,216    32,780
       Amortization of intangible assets               1,732     2,121
                                                       -----     -----
         Total operating expenses                     29,299    58,442
                                                      ------    ------
     Loss from operations                             (7,223)  (43,808)

       Interest income                                    21       897
       Interest expense                               (5,794)   (3,787)
       Other income (expense)                              8       (12)
                                                         ---       ---
     Net loss                                       $(12,988) $(46,710)
                                                    ========  ========

     Net loss per share, basic and diluted            $(0.45)   $(1.97)
                                                      ======    ======

     Weighted-average common shares used in
      computing net loss per share, basic and
      diluted                                         28,925    23,743
                                                      ======    ======

                         JAZZ PHARMACEUTICALS, INC.
                       SUMMARY OF PRODUCT SALES, NET
                               (In thousands)

                                                       Three Months
                                                      Ended March 31,
                                                        2009      2008
                                                        ----      ----
    Xyrem                                            $17,719   $11,341
    Luvox CR                                           3,600         -
    Antizol and Antizol-Vet (1)                            -     2,643
                                                       -----     -----
    Total                                            $21,319   $13,984
                                                     =======   =======

     (1) The Company sold its rights to and interests in Antizol and
         Antizol-Vet in August 2008.

                               JAZZ PHARMACEUTICALS, INC.
                                    (In thousands)
                                                     March 31,  December 31,
                                                       2009          2008
                                                       ----          ----
    Current assets:
      Cash and cash equivalents                       $17,015       $24,903
      Restricted cash                                     775         1,913
      Marketable securities                                 -         1,004
      Accounts receivable, net of allowances of
       $296 and $176 at March 31,
       2009 and December 31, 2008, respectively         7,012         6,643
      Inventories                                       4,430         4,788
      Prepaid expenses                                  2,206         2,366
      Other current assets                              2,106         2,382
                                                        -----         -----
        Total current assets                           33,544        43,999

    Property and equipment, net                         2,140         2,514
    Intangible assets, net                             35,794        32,526
    Goodwill                                           38,213        38,213
    Other long-term assets                                246           246
                                                          ---           ---
        Total assets                                 $109,937      $117,498
                                                     ========      ========

    Current liabilities:
      Accounts payable                                 $4,554        $5,736
      Accrued liabilities                              21,401        19,024
      Line of credit                                        -         3,875
      Senior secured notes                            123,970       118,534
      Purchased product rights liability                6,000        14,000
      Deferred revenue                                 12,605        12,322
                                                       ------        ------
        Total current liabilities                     168,530       173,491

    Purchased product rights liability, noncurrent     12,000             -
    Deferred revenue, noncurrent                       11,045        11,330
    Liability under government settlement              10,658        13,063
    Common stock subject to repurchase                      -        12,492

    Stockholders' deficit                             (92,296)      (92,878)
                                                      -------       -------
    Total liabilities and stockholders' deficit      $109,937      $117,498
                                                     ========      ========

SOURCE Jazz Pharmaceuticals, Inc.
Copyright©2009 PR Newswire.
All rights reserved

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