BOTHELL, Wash., Nov. 10, 2010 /PRNewswire-FirstCall/ -- SCOLR Pharma, Inc. (NYSE AMEX: DDD) today reported financial results for the three and nine months ended September 30, 2010.Stephen J. Turner, SCOLR Pharma's President and CEO, said, "Our focus for the remainder of the year will be to continue executing the plans for our extended release nutritional supplement and drug delivery businesses, which have both been advanced in the last quarter.
"We believe that our extended release formulations of nutritional products will offer consumers the benefits of these supplements on a continuous basis throughout the day, while also providing retailers an opportunity to provide their customers with greater choice. Working with the Emerson Group, we have been meeting with national retailers during their fourth quarter 2010 purchase planning cycles to present our nutritional products. Orders placed by these retailers in late 2010 or early 2011 would be expected to ship in early-mid 2011," Turner added.
Turner continued: "In the drug delivery business, we appear to be in the final stages of review by the Food and Drug Administration of our Abbreviated New Drug Application for extended release pseudoephedrine. Additionally, we have nearly completed protocol planning for the actual use label comprehension study for our extended release, 12-hour ibuprofen product. We expect to engage a services provider in the first quarter of 2011 in preparation for the conduct of that study. Additional revenue, financing or partnership support is required to complete the study, but we believe the Company is well positioned to move forward."
SCOLR Pharma also announced it was recently engaged by RedHill BioPharma, Ltd., to develop and test the manufacturing feasibility of prototype ondansetron tablets incorporating SCOLR's CDT technology. RedHill is an Israeli pharmaceutical company focused primarily on acquisitions and development of late clinical-stage new formulations of existing drugs. Ondansetron is sold under the trade name Zofran©.
RedHill is the exclusive licensee of SCOLR's CDT platform for application to extended release tablet formulations of ondansetron. Mr. Turner said, "We are encouraged that RedHill continues in its efforts to bring an extended release ondansetron tablet to market, and are pleased to continue our involvement in that process through these development services."In addition, in November SCOLR announced the award of approximately $250,000 in federal funds under the Therapeutic Discovery Project conducted by the Department of the Treasury and the Department of Health and Human Services. The funds were awarded in connection with qualifying development expenses incurred during 2009 and earlier this year.
Included as part of the Patient Protection and Affordable Care Act of 2010, the Therapeutic Discovery Project program provided a tax credit to encourage investments in new therapies to prevent, diagnose, and treat acute and chronic diseases. Companies such as SCOLR that cannot currently use a tax credit were allowed to apply for a cash grant in lieu of a tax credit. SCOLR was awarded the grant funds primarily in connection with expenditures on its program for development of an extended release formulation of ibuprofen, as well as its programs for development of new ondansetron and peramivir formulations.
Third Quarter 2010 compared to Third Quarter 2009 Financial ResultsTotal revenues for the quarter ended September 30, 2010 were $124,000, a decrease of 53% compared to $262,000 for the same period in 2009. This decrease is due to a decrease in royalty income from our relationship with Perrigo. Effective January 2010, commensurate with the amendment of our agreement with Perrigo, the royalty rate Perrigo pays us on sales of licensed products decreased from 50% of net profits to 20% of net profits, calculated in accordance with the amendment.
For the quarter ended September 30, 2010, the Company's marketing and selling expenses increased 56%, or $31,000, to $86,000 compared to $55,000 for the same period in 2009. This increase was primarily due to marketing and sales brokerage related expenses associated with the planned distribution of the nutritional products.
General and administrative expenses decreased 47%, or $571,000, to $650,000 for the three months ended September 30, 2010, compared to $1.2 million for the same period in 2009, primarily due to lower personnel-related expenses through personnel reductions.
Research and development expenses decreased 55%, or $315,000, to $257,000 for the three months ended September 30, 2010, compared to $572,000 for the same period in 2009, primarily due to reductions in personnel and other expenses reflecting the deferral of development activities for certain product candidates.
Net loss decreased 45%, or $716,000, to $869,000 for the three months ended September 30, 2010, compared to $1.6 million for the same period in 2009. The decrease was primarily due to lower overall operating expenses.
As of September 30, 2010, the Company had approximately $2.4 million in cash and cash equivalents, and $275,000 in restricted cash. Based on its current operating plan, the Company anticipates that existing cash and cash equivalents, together with expected royalties from third parties, will be sufficient to fund operations into the second quarter of 2011, unless unforeseen events arise that negatively impact liquidity.
Nine Months 2010 compared to Nine Months 2009 Financial ResultsTotal revenues decreased 23%, or $151,000, to $513,000 for the nine months ended September 30, 2010, compared to $664,000 for the same period in 2009. This decrease is primarily due to a reduction in royalty revenue from the Company's relationship with Perrigo.
For the nine months ended September 30, 2010, the Company's marketing and selling expenses decreased 8%, or $15,000, to $185,000 compared to $200,000 for the comparable period in 2009. This decrease was primarily due to a decrease in personnel- related expenses, advertising and tradeshow expenses, offset by an increase in sales brokerage related expenses associated with the planned distribution of the nutritional products.
General and administrative expenses decreased 42%, or $1.4 million, to $1.9 million for the nine months ended September 30, 2010, compared to $3.3 million for the same period in 2009, primarily due to a reduction in personnel related costs through headcount reductions and reductions in executive compensation.
Research and development expenses decreased 61%, or $1.3 million, to $853,000 for the nine months ended September 30, 2010, compared to $2.2 million for the same period in 2009, primarily due to reductions in personnel and other expenses reflecting the deferral of development activities for certain product candidates.
The net loss for the nine months ended September 30, 2010, decreased 52%, or $2.7 million, to $2.4 million, compared with a net loss of $5.1 million for the same period in 2009. This decrease was primarily due to lower overall operating expenses.
About SCOLR Pharma:Based in Bothell, Washington, SCOLR Pharma, Inc. is a specialty pharmaceutical company focused on applying its formulation expertise and patented CDT platforms to develop novel prescription pharmaceutical, over-the-counter (OTC), and nutritional products. Our CDT drug delivery platforms are based on multiple issued and pending patents and other intellectual property for the programmed release or enhanced performance of active pharmaceutical ingredients and nutritional products. For more information on SCOLR Pharma, please call 425-368-1050 or visit http://www.scolr.com/.
This press release contains forward-looking statements (statements which are not historical facts) within the meaning of the Private Securities Litigation Reform Act of 1995, including statements concerning anticipated sales of our nutritional products and the timing thereof, the timing of anticipated shipment of our nutritional products, our expectations concerning conduct of the actual use study for our ibuprofen product, our expectations concerning regulatory approval of our pseudoephedrine product and the anticipated timing of such approval. These forward-looking statements involve risks and uncertainties, including activities, events or developments that we expect, believe or anticipate will or may occur in the future. A number of factors could cause actual results to differ from those indicated in the forward-looking statements, including lower than expected demand by national retailers for our nutritional products, our ability to conform to the sales planning cycles of the retailers targeted as potential customers for our nutritional products, constraints on our liquidity related to the greater working capital requirements of our nutritional business, unanticipated changes in the timing or amount of orders for our nutritional products, unanticipated problems or delays with our regulatory applications, unanticipated costs and expenses associated with our product development, clinical activities and regulatory review, reductions in our royalty revenues, our ability to create and maintain partnerships or other relationships, the continuation of arrangements with our product development partners, customers and clinical project services providers, competition, government regulation and general economic conditions. For example, if we are not able to meet the timing and other expectations of the retailers we have targeted as potential customers of our nutritional products, we may not be able to generate revenue from sales of these products, or our ability to generate revenue from sales of these products may be significantly delayed. Further, if we are not successful in generating sufficient revenue, raising additional capital or securing partnership arrangements, we will not be able to complete the actual use study for our ibuprofen product or commercialize our pseudoephedrine product, and we may be required to further curtail or cease our operations. Additional assumptions, risks and uncertainties are described in detail in our registration statements, reports and other filings with the Securities and Exchange Commission, including the "Risk Factors" set forth in our Annual Report on Form 10-K, as supplemented by our quarterly reports on Form 10-Q. Such filings are available on our website or at www.sec.gov. You are cautioned that such statements are not guarantees of future performance and that actual result or developments may differ materially from those set forth in the forward-looking statements. We undertake no obligation to publicly update or revise forward-looking statements to reflect subsequent events or circumstance.SCOLR Pharma, Inc.CONDENSED BALANCE SHEETS
(In thousands, except par values and number of shares)
2010December 31, 2009ASSETSCurrent AssetsCash and cash equivalents$
1,176Accounts receivable125269Inventory129—Prepaid expenses and other assets414228Total current assets3,1071,673Property and Equipment — net of accumulated depreciation of $1,386 and $1,272, respectively356435Intangible assets — net of accumulated amortization of $584 and $514, respectively731565Restricted cash275438$
3,111LIABILITIES AND STOCKHOLDERS' EQUITYCurrent LiabilitiesAccounts payable$
47Accrued liabilities282640Deferred revenue —25Total current liabilities358712Deferred rent 168198Total liabilities526910Commitments and ContingenciesStockholders' EquityPreferred stock, authorized 5,000,000 shares, $.01 par value, none issued or outstanding——Common stock, authorized 100,000,000 shares, $.001 par value 49,816,073 and 41,098,270 issued and outstanding as of September 30, 2010, and December 31, 2009, respectively5041Additional paid-in capital76,97372,832Accumulated deficit(73,080)(70,672)Total stockholders' equity3,9432,201$
3,111SCOLR Pharma, Inc.CONDENSED STATEMENTS OF OPERATIONS
(In thousands, except shares and loss per share amounts)
(Unaudited)Three months ended
September 30,Nine months ended
September 30,2010200920102009RevenuesLicensing fees$
-Royalty income 124262388664 Total revenues124262513664Operating expensesMarketing and selling8655185200Research and development2575728532,188General and administrative6501,2211,8693,347Total operating expenses9931,8482,9075,735Loss from operations(869)(1,586)(2,394)(5,071)Other income (expense)Interest income-1112Interest expense---(4)Other--(15)-Total other income-1(14)8Net loss$
(5,063)Net loss per share, basic and diluted$
(0.12)Shares used in computing basic and diluted net loss per share49,816,07341,098,27047,571,31941,098,270
|SOURCE SCOLR Pharma, Inc.|
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