DARA BioSciences Reports Financial Results for the Third Quarter 2012
DARA BioSciences, Inc. (NASDAQ: DARA), a specialty pharmaceutical company focused on oncology and oncology supportive care products, and owner of exclusive U.S. marketing rights to Soltamox®, a novel oral liquid formulation of tamoxifen citrate, announced today financial results for the third quarter ended September 30, 2012 in its Quarterly Report on Form 10-Q.
For the three months ended September 30, 2012, DARA reported a net loss attributable to common stockholders of $1,983,372, or ($0.16) per share as compared to a net loss of $921,478, or ($0.18) per share for the same period in 2011. The increase in loss was primarily a result of the costs incurred in establishment of a sales and marketing infrastructure to support the promotion of the Company's oncology and oncology supportive care products as well as an increase in general and administrative expenses. As of September 30, 2012, cash and cash equivalents totaled $8,259,476 and marketable securities totaled $788,574.
Third Quarter and Recent Corporate Highlights:
- In October, DARA launched Soltamox®(tamoxifen citrate) oral liquid solution in the United States with initial shipments of product to wholesalers and certain specialty pharmacy providers. Soltamox is a new treatment option for breast cancer patients who are prescribed tamoxifen therapy. DARA has exclusive U.S. rights to Soltamox from Rosemont Pharmaceuticals, Ltd, UK. Prior to DARA's launch of Soltamox, tamoxifen was only available in the U.S. as a solid oral tablet.
- In September, DARA completed a series of agreements with a number of specialty pharmacy providers, leading group purchasing organizations (GPOs), retail partners, reimbursement experts, and an industry-leading third-party logistics provider, providing DARA comprehensive commercial coverage across the national oncology market. As part of an integrated national network with annual sales of over $1 billion in cancer therapeutics, DARA significantly enhanced its commercial scale and capabilities. Its distribution network now consists of more than 45,000 retail pharmacies, mail order pharmacies, and long-term care facilities. This network provides DARA with established reimbursement and logistics expertise, with more than 300 sales and marketing personnel uniquely focused on oncology and oncology support products, and further provides the company with additional partnering opportunities.
- In September, DARA entered into an exclusive agreement with the Helsinn Group of Switzerland for U.S. commercial rights to Gelclair®. Gelclair is an FDA-cleared, bioadherent oral protective gel product indicated for the treatment of oral mucositis, a painful inflammation and ulceration of the surface of the mouth and throat, which can result from a variety of cancer treatments. DARA plans to launch Gelclair late in the first quarter of 2013.
- In September, DARA reported that investors from the Company's April 2012 public offering had voluntarily elected to exercise warrants to purchase approximately 1.2 million shares of the Company's common stock at $1 per share whereby the Company realized net proceeds of approximately $1.2 million.
In July and August, DARA added two new directors to its board of
- Stephen O. Jaeger – Mr. Jaeger has more than 35 years of experience across a range of industries, including tenure at companies in the healthcare sector. He has served as director on boards including Savient Pharmaceuticals, Arlington Tankers LTD, eBT International Inc., Clinical Communications Group (a medical education company) and Hougton Mifflin. Mr. Jaeger also formerly served as chief executive officer of eBT International Inc.; and chief financial officer of Clinical Communications Group, Houghton Mifflin and Applera (a life sciences and instrument company).
- Timothy J. Heady - Mr. Heady retired in 2011 as CEO of UnitedHealthcare Pharmacy, a unit of UnitedHealthcare (UNH) representing more than $11 billion in annual prescription drug spending. In that role, he was responsible for all aspects of the business, including pharmaceutical rebate contracting, retail pharmacy network development, customer and member services, operations, and financial performance. UnitedHealthcare Pharmacy provides pharmacy benefits and management for employers, both commercial and government, representing more than 14 million individuals.
- During the quarter, DARA completed work to improve the formulation of KRN 5500 and took steps to manufacture clinical material for anticipated clinical trials. DARA has also been engaged during the quarter in partnering discussions to advance ongoing development of the drug.
DARA CEO, David J. Drutz, MD, stated, “We have had a number of important achievements since the beginning of the third quarter, many of which represent critical steps toward realizing our goal of becoming a leading oncology and oncology supportive care company in the United States. I am confident we now have an extraordinary team in place and that we are positioned to effectively execute against our business plan and strategy."
A summary of key financial highlights for the three and nine months ended September 30, 2012 is as follows ($thousands):
|As of and for the three month period ended September 30, 2012||As of and for the three month period ended September 30, 2011||As of and for the nine month period ended September 30, 2012||As of and for the nine month period ended September 30, 2011|
|Sales & Marketing||534.2||-||942.5||-|
|Research & Development||357.8||562.2||1,219.8||1,953.1|
|General & Administrative||1,233.8||708.0||3,909.6||2,299.9|
|Total operating expenses||2,125.8||1,270.2||6,071.9||4,253.0|
|Loss attributable to controlling interest||(1,983.4)||(921.5)||(5,439.8)||(3,740.9)|
|Cash and cash equivalents||8,259.5||1,179.2||8,259.5||1,179.2|
About DARA BioSciences, Inc.
DARA is a specialty pharmaceutical company focused on the development and commercialization of oncology treatment and supportive care products. DARA has comprehensive commercial coverage across the national oncology market through a series of agreements with a number of specialty pharmacy providers, leading group purchasing organizations (GPOs), retail partners, reimbursement experts, and an industry-leading third-party logistics provider. As part of an integrated national network with annual sales of over $1 billion in cancer therapeutics, DARA has significant commercial scale and capabilities. Its distribution network consists of more than 45,000 retail pharmacies, mail order pharmacies, and long-term care facilities. This provides DARA with established reimbursement and logistics expertise, as well as partnering opportunities with more than 300 sales and marketing personnel uniquely focused on oncology and oncology support products. This comprehensive network of partners is rare if not unique among companies in the oncology supportive care area and provides DARA a strong foundation for product introductions into this underserved market.
DARA increased its focus in oncology through its January 2012 acquisition of Oncogenerix, Inc., which holds the exclusive U.S. marketing rights to Soltamox®, a novel oral liquid formulation of tamoxifen citrate, which is widely used in the treatment and prevention of breast cancer. Soltamox is the only FDA-approved oral liquid version of tamoxifen citrate and fulfills a vital clinical need for patients who cannot tolerate existing solid tablet formulations of this drug. DARA launched Soltamox in October 2012 to coincide with National Breast Cancer Awareness Month. DARA has exclusive U.S. rights to Soltamox through a license from Rosemont Pharmaceuticals, Ltd. Additionally, in June 2012, DARA launched its first product, Bionect®, a topical treatment for skin irritation and burns associated with radiation therapy. DARA has rights to market Bionect in the US oncology/radiology markets under license from Innocutis. In September 2012, DARA entered into an exclusive agreement with the Helsinn Group of Switzerland for U.S. commercial rights to Gelclair®, an FDA-cleared product for the treatment of oral mucositis. DARA plans to launch Gelclair in the first quarter of 2013.
Prior to acquiring Oncogenerix, DARA was focused on the development of a cancer-support therapeutic compound, KRN5500, for the treatment of neuropathic pain in patients with cancer. This product has successfully completed a Phase 2a clinical trial, and has been designated a Fast Track Drug by the United States Food and Drug Administration. DARA is working with the National Cancer Institute (NCI) to design an additional clinical trial under joint DARA-NCI auspices while continuing to pursue partnering discussions.
In addition to its oncology products, DARA's pipeline includes DB959, a novel, non-TZD dual delta/gamma PPAR agonist for the treatment of type 2 diabetes and dyslipidemia. DARA has completed Phase 1 testing of DB959 and is presently pursuing opportunities to out-license this product.
For more information please visit our web site at www.darabio.com.
Safe Harbor Statement
All statements in this news release that are not historical are forward-looking statements within the meaning of the Securities Exchange Act of 1934, as amended. Such forward-looking statements are subject to factors that could cause actual results to differ materially for DARA from those projected. Those factors include risks and uncertainties relating to DARA's ability to timely commercialize and generate revenues or profits from Bionect®, Soltamox®, Gelclair® or other products given that DARA only recently hired its initial sales force and DARA's lack of history as a revenue-generating company, FDA and other regulatory risks relating to DARA's ability to market Bionect, Soltamox, Gelclair or other products in the U.S. or elsewhere, DARA's ability to develop and bring new products to market as anticipated, DARA's current cash position and its need to raise additional capital in order to be able to continue to fund its operations, the current regulatory environment in which DARA develops and sells its products, the market acceptance of those products, dependence on partners, successful performance under collaborative and other commercial agreements, competition, the strength of DARA's intellectual property and the intellectual property of others, the potential delisting of DARA's common stock from the NASDAQ Capital Market, risks and uncertainties relating to DARA's ability to successfully integrate Oncogenerix and other risk factors identified in the documents DARA has filed, or will file, with the Securities and Exchange Commission ("SEC"). Copies of DARA's filings with the SEC may be obtained from the SEC Internet site at http://www.sec.gov. DARA expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in DARA's expectations with regard thereto or any change in events, conditions, or circumstances on which any such statements are based. DARA BioSciences and the DARA logo are trademarks of DARA BioSciences, Inc.