Navigation Links
Transition Therapeutics Announces Second Quarter Fiscal 2009 Financial Results
Date:2/11/2009

TORONTO, Feb. 11 /PRNewswire-FirstCall/ - Transition Therapeutics Inc. ("Transition" or the "Company") (TSX: TTH; NASDAQ: TTHI), a product-focused biopharmaceutical company developing therapeutics for disease indications with large markets, today announced its financial results for the quarter ended December 31, 2008.

    Selected Highlights
    -------------------

    During the second quarter of fiscal 2009 and up to the date of this press
release, the Company achieved the following significant milestones:

    ELND005 (AZD-103) - Alzheimer's Disease:

    -   On October 20, 2008, Elan and Transition announced the achievement of
        the patient enrollment target for a Phase II clinical study of
        ELND005 (AZD-103) in patients with Alzheimer's disease. The study is
        a randomized, double-blind, placebo-controlled, dose-ranging, safety
        and efficacy study in patients with mild to moderate Alzheimer's
        disease. Each patient's planned treatment period is approximately 18
        months;

    TT-223 - Diabetes:

    -   On February 5, 2009, Transition announced the completion of patient
        enrolment for a Phase II clinical study of gastrin analogue, TT-223,
        in patients with type 2 diabetes;

    Corporate Developments:

    -   In January 2009, the Company disposed of 23,272,633 shares of Stem
        Cell Therapeutics Corp. ("Stem Cell") in open market transactions
        over the TSX Venture Exchange which resulted in net proceeds of
        approximately $1.4 million;

    -   On October 3, 2008, the Company received 23,272,633 freely tradable
        common shares of Stem Cell pursuant to the terms of a share purchase
        agreement entered into on October 4, 2004. Under the terms of this
        agreement, the final $1,650,000 milestone payment was due from Stem
        Cell to Transition on September 30, 2008. Stem Cell elected to make
        this payment in the form of Stem Cell common shares from treasury.

    Pipeline Review
    ---------------

ELND005 (AZD-103) for Alzheimer's Disease

Transition's lead Alzheimer's disease compound ELND005 (AZD-103) is a disease modifying agent with the potential to both prevent and reduce disease progression, and improve symptoms such as cognitive function.

In September 2006, Transition announced a global collaboration with Elan to develop and commercialize ELND005 (AZD-103). In April 2007, Transition announced that the FDA granted Fast Track designation to the investigational drug candidate ELND005 (AZD-103).

On August 30, 2007, the Company announced the completion of Phase I clinical studies with ELND005 (AZD-103). Transition and its development partner Elan have performed multiple Phase I studies evaluating the safety, tolerability and pharmacokinetic profile of ELND005 (AZD-103) in healthy volunteers. Approximately 110 subjects have been exposed to ELND005 (AZD-103) in multiple Phase I studies, including single and multiple ascending dosing; pharmacokinetic evaluation of levels in the brain; and CSF and plasma studies. ELND005 (AZD-103) was safe and well-tolerated at all doses and dosing regimens examined. There were no severe or serious adverse events observed. ELND005 (AZD-103) was also shown to be orally bio-available, cross the blood-brain barrier and achieve levels in the human brain and CSF that were shown to be effective in animal models for Alzheimer's disease.

On December 21, 2007, Elan and Transition announced that the first patient had been dosed in a Phase II clinical study of ELND005 (AZD-103) in patents with Alzheimer's disease. The study is a randomized, double-blind, placebo-controlled, dose-ranging, safety and efficacy study in approximately 340 patients with mild to moderate Alzheimer's disease. The study will evaluate both cognitive and functional endpoints, and each patient's participation is planned to last approximately 18 months.

On October 20, 2008, Elan and Transition announced the patient enrollment target for the Phase 2 clinical study of ELND005 (AZD-103) in patients with Alzheimer's disease was achieved.

TT-223 for Diabetes

Pre-clinical data in diabetes animal models demonstrate the efficacy of gastrin analogues alone, or in combination with GLP-1 analogues or epidermal growth factor analogues. In humans, Transition's Phase IIa clinical trial data showed that a 4-week therapy with TT-223 in combination with EGF (combination of gastrin analogue and epidermal growth factor analogue) in type 2 diabetes patients resulted in sustained reductions in blood glucose control parameters, including haemoglobinA1C, for 6 months post-treatment. Pre-clinical and clinical data suggests gastrin plays an important role in beta cell differentiation and function, capable of providing sustained glucose control in type 2 diabetes.

On March 13, 2008, Lilly and the Company entered into a licensing and collaboration agreement granting Lilly exclusive worldwide rights to develop and commercialize Transition's gastrin based therapies, including the lead compound TT-223, which is currently in early Phase II testing. Under the terms of the agreement, Transition has received a US$7 million upfront payment, and may also receive up to US$130 million in potential development and sales milestones, as well as royalties on sales of gastrin based therapies if any product is successfully commercialized.

Transition and Lilly are both funding the Phase II clinical trial with lead compound TT-223 in type 2 diabetes. Upon completion of this trial, Lilly will be responsible for further development activities and the commercialization of all gastrin-based therapeutic products worldwide.

To support the Phase II clinical development program for TT-223, Transition has performed two Phase I studies to expand the dose ranges for TT-223. The first study, a single ascending dose study of TT-223 in healthy volunteers and the second study, a multiple ascending dose study of TT-223 have both been completed.

In August 2008, Transition and its collaboration partner Lilly initiated a Phase II trial evaluating TT-223 in type 2 diabetes patients receiving metformin and/or thiazolidinediones (TZDs) which completed enrolling patients in February 2009. Transition and its development partner Lilly are in discussions regarding the timing and planning of another clinical study with TT-223 in combination with a GLP1 analogue in type 2 patients.

    Financial Review
    ----------------

Results of Operations

For the three-month period ended December 31, 2008, the Company recorded a net loss of $4,873,270 ($0.21 per common share) compared to a net loss of $1,552,208 ($0.07 per common share) for the three-month period ended December 31, 2007.

For the six-month period ended December 31, 2008, the Company recorded a net loss of $9,906,066 ($0.43 per common share) compared to a net loss of $5,651,186 ($0.25 per common share) for the six-month period ended December 31, 2007.

The increase in net loss of $3,321,062 or 214% for the three-month period ended December 31, 2008 and $4,254,880 or 75% for the six-month period ended December 31, 2008 is due to an increase in research and development expenses primarily resulting from an increase in clinical development costs related to ELND005 (AZD-103). The increase in net loss for the three and six-month periods ended December 31, 2008 is also attributed to an increase in general and administrative expense and decreases in interest income, revenue, and gain on note receivable. The increase in net loss was partially offset by foreign exchange gains resulting from the Company's US dollar investments.

Research and Development

Research and development expenses increased $2,657,687 from $2,480,123 for the three-month period ended December 31, 2007 to $5,137,810 for the three-month period ended December 31, 2008. For the six-month period ended December 31, 2008, research and development expenses increased $3,673,936 to $8,919,858 from $5,245,922 for the same period in fiscal 2008. For the three and six-month periods ended December 31, 2008, these increases were primarily the result of significant increases in clinical development costs due to the ongoing Phase II ELND005 (AZD-103) trial, preclinical costs associated with advancing the family of compounds acquired in the NeuroMedix transaction, and increased drug development costs relating to the Company's newly formed subsidiary, Transition Therapeutics (USA) Inc.

During the three-month period ended December 31, 2008, there was an increase in direct clinical program expenses relating to the Company's TT-223 program. However, for the six-month period ended December 31, 2008 there was an overall decrease in the program costs resulting from the reimbursement of costs from Lilly.

General and Administrative

During the three-month period ended December 31, 2008, general and administrative expenses increased $117,525 to $1,623,724 from $1,506,199 for the same period in fiscal 2008. For the six-month period ended December 31, 2008, general and administrative expenses increased $333,442 to $3,171,822 from $2,838,380 for the same six-month period in fiscal 2008. The increases in general and administrative expenses for the three and six-month periods ended December 31, 2008 are due to increased option expenses, salaries and facility expenses. These increases have been partially offset by decreases in professional and regulatory costs as the comparative periods contained increased costs associated with the NASDAQ listing of August, 2007.

Amortization

Amortization for the three-month period ended December 31, 2008, increased $27,262 to $691,168 as compared to $663,906 for the three-month period ended December 31, 2007. For the six-month period ended December 31, 2008, amortization increased $159,173 to $1,482,397 as compared to $1,323,224 for the same period in fiscal 2008.

The three-month period increase in amortization expense is primarily due to the amortization expense relating to the compounds, technology and patents acquired from Forbes during the first quarter of fiscal 2009. The six-month period increase in amortization expense is due to increased amortization expense relating to the workforce acquired from Protana due to a workforce reduction, the full-quarter impact of amortizing the additional consideration paid to acquire the ENI technology in December, 2007 and the amortization expense resulting from the assets acquired from Forbes.

Interest Income, net

Interest income for the three-month period ended December 31, 2008 was $346,505 as compared to $692,552 for the same period in fiscal 2008, resulting in a decrease of $346,047. For the six-month period ended December 31, 2008, interest income was $760,129 as compared to $1,289,031 for the same period in fiscal 2007, resulting in a decrease of $528,902. The decreases in interest income resulted from decreased cash balances due to cash disbursements as well as decreases in effective interest rates.

    About Transition
    ----------------

Transition is a biopharmaceutical company, developing novel therapeutics for disease indications with large markets. Transition's lead products include ELND005 (AZD-103) for the treatment of Alzheimer's disease and TT-223 for the treatment of diabetes. Transition has an emerging pipeline of preclinical drug candidates acquired externally or developed internally using its proprietary drug discovery engine. Transition's shares are listed on the NASDAQ under the symbol "TTHI" and the Toronto Stock Exchange under the symbol "TTH". For additional information about the Company, please visit www.transitiontherapeutics.com.

Extracts of the Financial Statements to Follow:

    CONSOLIDATED BALANCE SHEETS
    (Unaudited)

                                                   December 31,      June 30,
                                                          2008          2008
    -------------------------------------------------------------------------
    ASSETS
    Current
    Cash and cash equivalents                       19,183,981    22,952,865
    Held-to-maturity investments                    36,616,029    40,710,765
    Available-for-sale investments                     930,905             -
    SCT receivable                                           -     1,650,000
    Due from Eli Lilly and Company                   1,128,219       472,220
    GST receivable                                     392,050       278,784
    Investment tax credits receivable                  889,922       693,057
    Prepaid expenses and deposits                    1,256,879       974,426
    -------------------------------------------------------------------------
    Total current assets                            60,397,985    67,732,117
    Capital assets, net                                855,573       958,689
    Intangible assets                               25,847,604    26,185,155
    -------------------------------------------------------------------------
                                                    87,101,162    94,875,961
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    LIABILITIES AND SHAREHOLDERS' EQUITY
    Current
    Accounts payable and accrued liabilities         2,317,737     1,576,190
    Due to Elan Pharma International Limited         2,522,310     1,795,242
    -------------------------------------------------------------------------
    Total current liabilities                        4,840,047     3,371,432
    Deferred revenue                                27,736,750    27,736,750
    Leasehold inducement                                74,308        80,024
    -------------------------------------------------------------------------
    Total liabilities                               32,651,105    31,188,206
    -------------------------------------------------------------------------

    Shareholders' equity
    Common shares                                  160,471,098   160,262,540
    Contributed surplus                              4,501,050     4,492,251
    Stock options                                    4,263,841     3,093,735
    Accumulated other comprehensive loss              (719,095)            -
    Deficit                                       (114,066,837) (104,160,771)
    -------------------------------------------------------------------------
    Total shareholders' equity                      54,450,057    63,687,755
    -------------------------------------------------------------------------
                                                    87,101,162    94,875,961
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    CONSOLIDATED STATEMENTS OF LOSS
    (Unaudited)

                            Six-month    Six-month  Three-month  Three-month
                               period       period       period       period
                                ended        ended        ended        ended
                          December 31, December 31, December 31, December 31,
                                 2008         2007         2008         2007
                                    $            $            $            $
    -------------------------------------------------------------------------
    REVENUES
    Licensing fees                  -    1,596,722            -    1,563,911
    -------------------------------------------------------------------------
                                    -    1,596,722            -    1,563,911
    -------------------------------------------------------------------------
    EXPENSES
    Research and
     development            8,919,858    5,245,922    5,137,810    2,480,123
    General and
     administrative         3,171,822    2,838,380    1,623,724    1,506,199
    Amortization            1,482,397    1,323,224      691,168      663,906
    Foreign exchange
     gain                  (2,918,176)    (220,587)  (2,232,927)    (191,557)
    Loss on disposal of
     capital assets            10,294            -            -            -
    -------------------------------------------------------------------------
                           10,666,195    9,186,939    5,219,775    4,458,671
    -------------------------------------------------------------------------
    Loss before the
     following:           (10,666,195)  (7,590,217)  (5,219,775)  (2,894,760)
    Interest income from
     held-to-maturity
     investments              760,129    1,289,031      346,505      692,552
    Gain on note
     receivable                     -      650,000            -      650,000
    -------------------------------------------------------------------------
    Net loss for the
     period                (9,906,066)  (5,651,186)  (4,873,270)  (1,552,208)
    -------------------------------------------------------------------------

    Basic and diluted
     net loss per common
     share                      (0.43)       (0.25)       (0.21)       (0.07)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY

    For the six-month period ended December 31, 2008 and year ended
    June 30, 2008
    (Unaudited)

                         Number of         Share   Contributed         Stock
                            Shares       Capital       Surplus       Options
    -------------------------------------------------------------------------
                               #             $             $             $
    Balance, July 1,
     2007               21,230,741   133,988,318     4,487,752     1,538,396
    -------------------------------------------------------------------------
    Adjustment to
     opening deficit
     for change in
     accounting policy
     related to
     financial
     instruments                 -             -             -             -
    Issued pursuant to
     private placement,
     net                 1,736,107    23,968,567             -             -
    Issued as
     additional
     consideration
     regarding
     Ellipsis
     Neurotherapeutics
     Inc.                  174,123     1,890,976             -             -
    Stock options
     exercised or
     cancelled              45,736       414,679         4,499      (166,534)
    Stock-based
     compensation
     expense                     -             -             -     1,721,873
    Net loss and
     comprehensive loss
     for the year                -             -             -             -
    -------------------------------------------------------------------------
    Balance, June 30,
     2008               23,186,707   160,262,540     4,492,251     3,093,735
    -------------------------------------------------------------------------
    Net loss for the
     six-month period
     ended December 31,
     2008                        -             -             -             -
    Unrealized loss on
     available-for-sale
     investments                 -             -             -             -
    -------------------------------------------------------------------------
    Total Other
     Comprehensive
     income (loss)      23,186,707   160,262,540     4,492,251     3,093,735
    Stock options
     exercised, expired
     or cancelled           28,453       208,558         8,799       (91,806)
    Stock-based
     compensation
     expense                     -             -             -     1,261,912
    -------------------------------------------------------------------------
    Balance, December
     31, 2008           23,215,160   160,471,098     4,501,050     4,263,841
    -------------------------------------------------------------------------


                                                         Total
                                     Accumulated       Deficit
                                           Other     and Other         Total
                                   Comprehensive Comprehensive Shareholders'
                           Deficit          Loss          Loss        Equity
    -------------------------------------------------------------------------
                                 $             $             $             $
    Balance, July 1,
     2007              (89,691,569)            -   (89,691,569)   50,322,897
    -------------------------------------------------------------------------
    Adjustment to
     opening deficit
     for change in
     accounting policy
     related to
     financial
     instruments         1,650,000             -     1,650,000     1,650,000
    Issued pursuant to
     private placement,
     net                         -             -             -    23,968,567
    Issued as
     additional
     consideration
     regarding
     Ellipsis
     Neurotherapeutics
     Inc.                        -             -             -     1,890,976
    Stock options
     exercised or
     cancelled                   -             -             -       252,644
    Stock-based
     compensation
     expense                     -             -             -     1,721,873
    Net loss and
     comprehensive loss
     for the year      (16,119,202)            -   (16,119,202)  (16,119,202)
    -------------------------------------------------------------------------
    Balance, June 30,
     2008             (104,160,771)            -  (104,160,771)   63,687,755
    -------------------------------------------------------------------------
    Net loss for the
     six-month period
     ended December 31,
     2008               (9,906,066)            -    (9,906,066)   (9,906,066)
    Unrealized loss on
     available-for-sale
     investments                 -      (719,095)     (719,095)     (719,095)
    -------------------------------------------------------------------------
    Total Other
     Comprehensive
     income (loss)    (114,066,837)     (719,095) (114,785,932)   53,062,594
    Stock options
     exercised, expired
     or cancelled                -             -             -       125,551
    Stock-based
     compensation
     expense                     -             -             -     1,261,912
    -------------------------------------------------------------------------
    Balance, December
     31, 2008         (114,066,837)     (719,095) (114,785,932)   54,450,057
    -------------------------------------------------------------------------



    CONSOLIDATED STATEMENTS OF CASH FLOWS
    (Unaudited)

                            Six-month    Six-month  Three-month  Three-month
                               period       period       period       period
                                ended        ended        ended        ended
                          December 31, December 31, December 31, December 31,
                                 2008         2007         2008         2007
                                    $            $            $            $
    -------------------------------------------------------------------------
    OPERATING ACTIVITIES
    Net loss for the
     period                (9,906,066)  (5,651,186)  (4,873,270)  (1,552,208)
    Add (deduct) items not
     involving cash:
    Amortization of:
      capital assets           98,623      119,133       49,770       59,928
      intangible assets     1,468,831    1,293,084      683,937      648,473
      leasehold inducement     (5,716)      (5,716)      (2,858)      (2,858)
    Stock-based
     compensation expense   1,261,912      684,170      618,364      359,380
    Gain of company
     transferred under
     contractual
     arrangement                    -     (650,000)           -     (650,000)
    Loss on disposal of
     capital assets            10,294            -            -            -
    Unrealized foreign
     exchange (gain)
     loss                  (1,815,088)      26,150   (1,714,414)      12,968
    Accrued interest on
     held-to-maturity
     investments             (277,634)    (664,566)    (248,810)    (460,232)
    Net change in
     operating assets
     and liabilities          220,032    4,308,794    1,235,990    5,882,782
    -------------------------------------------------------------------------
    Cash provided by
     (used in) operating
     activities            (8,944,812)    (540,137)  (4,251,291)   4,298,233
    -------------------------------------------------------------------------
    INVESTING ACTIVITIES
    Maturity of short-term
     investments          164,334,463  202,906,278   46,750,925   41,670,570
    Purchase of short-term
     investments         (158,990,674)(214,446,806) (50,844,858) (53,916,928)
    Purchase of capital
     assets                   (53,962)     (10,157)     (10,645)      (6,910)
    Purchase of intangible
     assets                (1,131,280)           -            -            -
    Proceeds on disposal
     of capital assets         48,161            -            -            -
    Cash received from
     company transferred
     under contractual
     arrangement                    -      650,000            -      650,000
    -------------------------------------------------------------------------
    Cash provided by (used
     in) investing
     activities             4,206,708  (10,900,685)  (4,104,578) (11,603,268)
    -------------------------------------------------------------------------
    FINANCING ACTIVITIES
    Proceeds from issuance
     of common shares, net    125,551   24,046,496            -        8,050
    -------------------------------------------------------------------------
    Cash provided by
     financing activities     125,551   24,046,496            -        8,050
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    Impact of foreign
     exchange on cash and
     cash equivalents         843,669      (13,885)     654,344         (673)
    -------------------------------------------------------------------------

    Net increase (decrease)
     in cash and cash
     equivalents during
     the period            (3,768,884)  12,591,789   (7,701,525)  (7,297,658)
    Cash and cash
     equivalents, beginning
     of period             22,952,865    1,377,387   26,885,506   21,266,834
    -------------------------------------------------------------------------
    Cash and cash
     equivalents, end of
     period                19,183,981   13,969,176   19,183,981   13,969,176
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

Notice to Readers: Information contained in our press releases should be considered accurate only as of the date of the release and may be superseded by more recent information we have disclosed in later press releases, filings with the OSC, SEC or otherwise. Except for historical information, this press release may contain forward-looking statements, relating to expectations, plans or prospects for Transition, including conducting clinical trials. These statements are based upon the current expectations and beliefs of Transition's management and are subject to certain risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties include factors beyond Transition's control and the risk factors and other cautionary statements discussed in Transition's quarterly and annual filings with the Canadian commissions.


'/>"/>
SOURCE Transition Therapeutics Inc.
Copyright©2009 PR Newswire.
All rights reserved


Related medicine news :

1. Transition Therapeutics Announces Fiscal 2007 Year End Financial Results
2. Transition Therapeutics Receives Remaining Upfront Payment from Elan Corporation, plc
3. Transition Therapeutics to Hold Conference Call on First Quarter Fiscal 2008 Financial Results on Wednesday, November 14, at 8:30 A.M. EST
4. New UIC center to study end-of-life transition
5. Seabrook House Opens Transitional Living Facility: Seabrook West
6. Transition Therapeutics Announces Milestone Payment from Elan
7. Transition Therapeutics Announces Appointment of Vice-President of Business Development
8. Pure Weight Loss Takes Additional Steps To Assure Seamless Transition For Clients
9. Zimmer Spine Introduces New Rigid to Dynamic Stabilization Transition System
10. Bisexuality not a transitional phase among women, according to new research
11. Transition of Behavioral Health Services from WPIC-BV to Heritage Valley Health System
Post Your Comments:
*Name:
*Comment:
*Email:
(Date:2/13/2016)... ... , ... Valentine’s Day is nearly upon us, and most singles could probably ... flawless hair, and a sparkling personality are all well and good, but if somebody ... home with Rover. (Actually, man’s best friend might not even want to be near ...
(Date:2/13/2016)... ... February 13, 2016 , ... In its newly ... vein visualization technology should be used to ensure patient safety when placing an ... INS Standards mandate the use of vein visualization technology in patients with difficult ...
(Date:2/12/2016)... ... 12, 2016 , ... According to an article published February 4th ... significant portion of hernia repairs throughout the United States. Commenting on this article, Beverly ... that this trend has not only been expected, but it seems to be a ...
(Date:2/12/2016)... ... February 12, 2016 , ... CDRH Enforcement Trends: , Back to the Future , ... , As Winston Churchill said, “Those who don’t learn from history are doomed to ... expect when they come knocking this year. But that takes time. , Take a ...
(Date:2/12/2016)... ... February 12, 2016 , ... T.E.N., a ... closed for the ISE Southeast Awards 2016. Finalists and winners of the ISE® ... Southeast Executive Forum and Awards Gala on March 15, 2016 at the Westin ...
Breaking Medicine News(10 mins):
(Date:2/12/2016)... 12 2016  OMS Supply, a large provider of ... announced today the recent launching of their new company ... of features that enhance the user experience and enable ... --> --> Despite ... company that started in early 2016, they have already ...
(Date:2/11/2016)... Feb. 11, 2016 - ... in Personalized Medicine and Cancer Therapy. - European ... Diagnostic Testing Markets. - Key Diagnostic Testing Markets. ... Molecular Diagnostics in Genetic Testing. - Molecular Diagnostics ... - Over-the-Counter Diagnostic Products World Markets. - ...
(Date:2/11/2016)... -- Kindred Biosciences, Inc. (NASDAQ: KIN ), a biopharmaceutical ... pets, today announced the submission to FDA of the ... (NADA) for Zimeta™ (dipyrone injection, KIND-012).  Positive topline results ... the control of pyrexia (fever) in horses were recently ... --> The Chemistry, Manufacturing, and Controls technical ...
Breaking Medicine Technology: