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Pharmasset Reports Financial Results for Quarter Ended June 30, 2008
Date:8/14/2008

PRINCETON, N.J., Aug. 14 /PRNewswire-FirstCall/ -- Pharmasset, Inc. (Nasdaq: VRUS), a clinical stage pharmaceutical company committed to discovering, developing and commercializing novel drugs to treat viral infections, reported unaudited financial results for the third fiscal quarter ended June 30, 2008. Pharmasset reported a net loss attributable to common stockholders of $15.0 million, or a loss per share of $0.69 for the quarter ended June 30, 2008, as compared to a net loss attributable to common stockholders of $7.1 million, or a loss per share of $0.40 per share for the same period in 2007.

Revenues were $0.5 million during the quarters ended June 30, 2008 and 2007 and reflect amortization of up-front and subsequent collaborative and license payments received from Roche previously recorded as deferred revenue. Total costs and expenses for the quarter ended June 30, 2008 were $15.0 million, as compared to $7.1 million for the same period in 2007. The $7.9 million increase in total costs and expenses during the quarter ended June 30, 2008 was primarily due to a $5.8 million increase in Phase 3 clinical trial expenses to support registration of clevudine for the treatment of chronic hepatitis B virus (HBV) infection, a $1.0 million increase in compensation expense resulting from increased headcount, a $0.4 million increase in new drug discovery expenses, and a $0.7 million increase in marketing and other administrative expenses. Investment income decreased to $0.2 million during the quarter ended June 30, 2008 from $0.7 million in the quarter ended June 30, 2007, primarily on lower rates of return on invested balances. Interest expense increased to $0.7 million during the quarter ended June 30, 2008 from $0.0 million in the year-ago quarter. The increase was due to interest on the $20.0 million of debt incurred during October 2007 and March 2008.

As of June 30, 2008, Pharmasset had approximately $51.0 million of cash and cash equivalents and approximately $1.0 million of short-term investments.

"We have made solid progress across all aspects of our business in this last quarter. The ANRS sponsored study investigating clevudine in combination with Viread(R) in HBV is a very exciting study for us and reflects the potential movement of the marketplace toward combination therapy," stated Schaefer Price, Pharmasset's Chief Executive Officer. "In addition, we have made substantial progress in our HCV programs with the recent clinical data from R7128 and our nomination of PSI-7851 as a next-generation lead product candidate to be advanced into clinical development. This progress allows us to maintain a well-balanced and growing portfolio of hepatology product candidates", added Mr. Price. "We look forward to the unblinding of our R7128 genotype 2/3 patient data and hope to see data that is consistent with the antiviral activity we see in genotype 1 patients."

Highlights of the Quarter Ended June 30, 2008

-- Commenced dosing two additional cohorts of a 4-week Phase 1 study of

R7128 in combination with Pegasys(R) (peginterferon alfa-2a) plus

Copegus(R) (ribavirin) in both genotype 1 treatment-naive patients and

genotypes 2 and 3 treatment-experienced HCV patients.

-- Nominated PSI-7851 as a lead product candidate for the treatment of

HCV. PSI-7851 is a proprietary nucleotide analogue polymerase inhibitor

of HCV that is being advanced into Good Laboratory Practice (GLP)

toxicology studies.

-- Announced receipt of a Notice of Allowance from the United States

Patent and Trademark Office covering the anti-HCV drug PSI-6130 and its

active metabolites.

-- Joined the NASDAQ Biotechnology Index and the broad-market Russell 3000

Index.

Highlights since the Quarter Ended June 30, 2008

-- Announced preliminary safety and efficacy results of Cohort 3 of a 4-

week Phase 1 study of R7128 1000mg twice daily (BID) in combination

with Pegasys(R) plus Copegus(R) for the treatment of HCV, in which

patients achieved a mean 5.0 log10 IU/mL decrease in HCV RNA and 88%

(22 of 25) of patients achieved undetectable HCV RNA levels following

4 weeks of treatment with blinded safety and tolerability similar to

the safety profile observed with the standard of care alone (Pegasys(R)

and Copegus(R)).

-- Raised $24.2 million in net proceeds after deducting placement agent

fees and estimated offering expenses by selling 1,450,000 shares of

common stock to a select group of institutional investors in a

"registered direct" public offering. The net proceeds from this

offering will be used for general corporate purposes.

-- Announced initiation of a combination study of clevudine and Viread(R)

for HBV by the French National Agency for Research on AIDS and Viral

Hepatitis (ANRS).

Anticipated Highlights

-- Announcing preliminary results of a 4-week combination study of R7128

1500 mg BID with Pegasys(R) plus Copegus(R) in treatment-experienced

patients with HCV genotypes 2 and 3 by the end of the third calendar

quarter of 2008.

-- Completing HBV patient enrollment for clevudine Phase 3 registration

studies in the second calendar half of 2008.

-- Submitting the draft protocol and supporting documentation for our 12-

week Phase 2b combination study of R7128 with Pegasys(R) plus

Copegus(R) to the FDA during November 2008.

About Pharmasset

Pharmasset is a clinical-stage pharmaceutical company committed to discovering, developing and commercializing novel drugs to treat viral infections. Pharmasset's primary focus is on the development of oral therapeutics for the treatment of hepatitis B virus (HBV), hepatitis C virus (HCV) and human immunodeficiency virus (HIV).

Pharmasset is currently developing three product candidates. Clevudine, for the treatment of chronic HBV infection, is enrolling Phase 3 clinical trials for registration in North, Central and South America and Europe. Clevudine is already approved for HBV in South Korea and marketed by Bukwang Pharmaceuticals in South Korea under the brand name Levovir. R7128, an oral treatment for chronic HCV infection, is in a 4-week Phase 1 clinical trial in combination with Pegasys(R) plus Copegus(R) through a strategic collaboration with Roche. Racivir, which is being developed for the treatment of HIV in combination with other approved HIV drugs, has completed a Phase 2 clinical trial.

Pegasys(R) and Copegus(R) are registered trademarks of Roche.

Contact

Kurt Leutzinger

Chief Financial Officer

kurt.leutzinger@pharmasset.com

Office: +1 (609) 613-4110

Forward-Looking Statements

Pharmasset "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding our business that are not historical facts are "forward-looking statements" that involve risks and uncertainties, including without limitation, the risk that adverse events could cause the cessation or delay of any of the ongoing or planned clinical trials and/or our development of our product candidates, the risk that the results of previously conducted studies involving our product candidates will not be repeated or observed in ongoing or future studies involving our product candidates, the risk that our collaboration with Roche will not continue or will not be successful and the risk that any one or more of our product candidates will not be successfully developed and commercialized. For a discussion of these risks and uncertainties, any of which could cause our actual results to differ from those contained in the forward-looking statements, see the section of our Annual Report on Form 10-K for the fiscal year ended September 30, 2007 filed with the Securities and Exchange Commission entitled "Risk Factors" and discussions of potential risks and uncertainties in our subsequent filings with the Securities and Exchange Commission.

PHARMASSET, INC.

CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE NET LOSS

(UNAUDITED)

Three Months Ended

June 30,

--------------------------

2008 2007

--------------------------

REVENUES: $464,291 $464,291

--------------------------

COSTS AND EXPENSES:

Research and development 11,499,843 4,426,252

General and administrative 3,473,635 2,640,655

--------------------------

Total costs and expenses 14,973,478 7,066,907

--------------------------

OPERATING LOSS (14,509,187) (6,602,616)

INVESTMENT INCOME 216,287 744,938

INTEREST EXPENSE (735,543) (4,435)

--------------------------

LOSS BEFORE INCOME TAXES (15,028,443) (5,862,113)

PROVISION FOR INCOME TAXES - -

--------------------------

NET LOSS (15,028,443) (5,862,113)

REDEEMABLE PREFERRED STOCK ACCRETION - 1,204,653

--------------------------

NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS $(15,028,443) $(7,066,766)

==========================

COMPREHENSIVE NET LOSS:

NET LOSS $(15,028,443) $(5,862,113)

UNREALIZED GAIN (LOSS) ON AVAILABLE-FOR-SALE

INVESTMENTS 12,503 -

--------------------------

COMPREHENSIVE NET LOSS $(15,015,940) $(5,862,113)

==========================

NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS

PER SHARE:

BASIC $(0.69) $(0.40)

DILUTED $(0.69) $(0.40)

WEIGHTED AVERAGE SHARES OUTSTANDING:

BASIC 21,635,205 17,558,466

DILUTED 21,635,205 17,558,466

PHARMASSET, INC.

CONDENSED BALANCE SHEETS

As of

June 30, As of

2008 September 30,

(unaudited) 2007

--------------------------

ASSETS

CURRENT ASSETS:

Cash and cash equivalents $51,048,837 $68,745,694

Short-term investments 987,126 1,252,113

Amounts due under collaborative agreements 1,863,843 919,110

Prepaid expenses and other assets 1,189,002 783,311

--------------------------

Total current assets 55,088,808 71,700,228

--------------------------

EQUIPMENT AND LEASEHOLD IMPROVEMENTS:

Laboratory, office furniture and equipment 3,240,023 2,462,647

Leasehold improvements 1,836,553 1,836,553

--------------------------

5,076,576 4,299,200

Less accumulated depreciation and amortization (2,185,498) (1,437,080)

--------------------------

Total equipment and leasehold

improvements, net 2,891,078 2,862,120

OTHER ASSETS 249,875 1,282,051

--------------------------

TOTAL $58,229,761 $75,844,399

==========================

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:

Current portion of long-term debt $1,167,289 $-

Current portion of capital lease obligation 82,558 159,440

Accounts payable 1,314,299 3,281,600

Accrued expenses 6,538,180 5,513,407

Deferred rent 124,462 124,462

Deferred revenue 1,857,136 1,857,136

--------------------------

Total current liabilities 11,083,924 10,936,045

DEFERRED RENT 111,164 204,256

NON CURRENT PORTION OF CAPITAL LEASE OBLIGATION - 41,641

DEFERRED REVENUE 4,333,257 5,726,131

LONG-TERM DEBT, net 17,899,100 -

--------------------------

Total liabilities 33,427,445 16,908,073

--------------------------

COMMITMENTS

STOCKHOLDERS' EQUITY

Common Stock, $0.001 par value, 100,000,000

shares authorized, 21,751,503 and 21,232,991

shares issued and outstanding at June 30, 2008

(unaudited) and September 30, 2007,

respectively 21,752 21,233

Warrants to purchase 116,183 shares of common stock

for $12.05 per share, with 66,390 exercisable

starting September 30, 2007, and 49,793 shares

exercisable starting March 28, 2008 (unaudited) 1,140,114 526,720

Additional paid-in capital 120,124,752 115,518,201

Accumulated other comprehensive (loss) income (12,664) 4,405

Accumulated deficit (96,471,638) (57,134,233)

--------------------------

Total stockholders' equity 24,802,316 58,936,326

--------------------------

TOTAL $58,229,761 $75,844,399

==========================


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SOURCE Pharmasset, Inc.
Copyright©2008 PR Newswire.
All rights reserved

Related medicine technology :

1. Pharmasset Reports Preliminary Results of a 4-week Combination Study of R7128 for the Treatment of Chronic Hepatitis C
2. Pharmasset Announces Initiation of Combination Study of Clevudine and Viread(R) for HBV by French National Agency for Research on AIDS and Viral Hepatitis (ANRS)
3. Pharmasset Receives Notice of Allowance
4. Pharmasset Nominates PSI-7851 as a Lead Development Candidate for the Treatment of Chronic Hepatitis C
5. Pharmasset Commences Dosing R7128 Cohorts 3 and 4 for the Treatment of Chronic Hepatitis C
6. Pharmasset Presents Results of 4-Week Combination Study of R7128 for the Treatment of Chronic Hepatitis C
7. Pharmasset Reports First Fiscal Quarter 2008 Financial Results
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9. Pharmasset Announces R7128 Achieves 85% Rapid Virologic Response in a 4-week Combination Study for the Treatment of Chronic Hepatitis C
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11. Pharmasset Commences Dosing in 28-Day Combination Study of R7128 with Pegasys(R) plus Copegus(R) for Hepatitis C
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