Full Press Release Details
A.P. Pharma Announces Third Quarter 2012 Financial Results and Highlights Recent Corporate Progress
REDWOOD CITY, Calif. November 5, 2012 A.P. Pharma, Inc. (OTCBB: APPA.OB), a specialty pharmaceutical company, today reported financial results for the quarter ended September 30,
2012 and highlighted recent corporate progress.
A.P. Pharma s accomplishments over the quarter have put us in a strong position as
we approach a new era for the organization and begin preparing for commercialization of APF530, said John B. Whelan, A.P. Pharma s president and chief executive officer. We successfully completed the resubmission of our New Drug
Application for APF530 and secured the financing necessary to fund our operations through the anticipated APF530 product launch in 2013. In addition, we have added key staff and executives that are essential to our pre-commercialization activities,
including our chief commercial officer, Robert Rosen, and vice president of business development, Dr. Thomas Pitler.
A.P. Pharma s net loss for the third quarter of 2012 was $6.1 million, or $0.02 per share, compared to a net loss of $4.2
million, or $0.02 per share, for the third quarter of 2011. The net loss was higher in the current fiscal quarter primarily due to higher stock compensation and personnel-related expenses, and increased spending related to the NDA resubmission.
Cash and cash equivalents as of September 30, 2012 were $60.0 million, compared to $18.0 million at December 31, 2011. Net cash
used in operating activities was $10.9 million for the nine months ended September 30, 2012.
The Company believes that its current cash resources are sufficient to fund its operations through the
anticipated product launch of APF530 in 2013, assuming approval.
A.P. Pharma s lead product candidate, APF530, is being developed for the prevention of both acute- and delayed-onset chemotherapy-induced nausea and vomiting (CINV). One of the most debilitating side
effects of cancer chemotherapy, CINV is a leading cause of premature discontinuation of treatment. There is only one injectable 5-HT3 antagonist approved for the prevention of delayed-onset CINV, so this indication represents an area of particular
unmet medical need. APF530 contains the 5-HT3 antagonist granisetron formulated in the Company s proprietary Biochronomer drug delivery system, which allows therapeutic drug levels to be maintained for five days with a single subcutaneous
injection. This five-day range is designed to cover the delayed phase of CINV, whereas currently available intravenous and oral formulations of granisetron are approved only for the prevention of acute-onset CINV. Granisetron was selected for APF530
because it is widely prescribed by physicians based on a well-established record of safety and efficacy.
A.P. Pharma is a specialty pharmaceutical company developing products using its proprietary Biochronomer polymer-based drug delivery platform. This
drug delivery platform is designed to improve the therapeutic profile of injectable pharmaceuticals by converting them from products that must be injected once or twice per day to products that need to be injected only once every one or two weeks.
The Company s lead product candidate, APF530, is being developed for the prevention of both acute- and delayed-onset chemotherapy-induced nausea and vomiting. A.P. Pharma received a Complete Response Letter to its APF530 New Drug Application
(NDA) and resubmitted the NDA to the U.S. Food and Drug Administration. The FDA has set a Prescription Drug User Fee Act (PDUFA) action date of March 27, 2013. For further information, please visit the Company s web site at
(financial tables follow)
Condensed Statements of Operations
(in thousands, except per share amounts)
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2012 | 2011 | 2012 | 2011 | |||||||||||||
| Contract revenue | $ | $ | $ | $ | 646 | |||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 3,626 | 2,929 | 10,022 | 5,352 | ||||||||||||
| General and administrative | 2,428 | 1,160 | 5,181 | 2,238 | ||||||||||||
| Total operating expenses | 6,054 | 4,089 | 15,203 | 7,590 | ||||||||||||
| Operating loss | (6,054 | ) | (4,089 | ) | (15,203 | ) | (6,944 | ) | ||||||||
| Interest expense, net | (195 | ) | (62 | ) | (402 | ) | (326 | ) | ||||||||
| Loss from continuing operations | (6,249 | ) | (4,151 | ) | (15,605 | ) | (7,270 | ) | ||||||||
| Income (loss) from discontinued operations | 128 | (51 | ) | (6 | ) | (283 | ) | |||||||||
| Net loss | $ | (6,121 | ) | $ | (4,202 | ) | $ | (15,611 | ) | $ | (7,553 | ) | ||||
| Basic and diluted net loss per share: | ||||||||||||||||
| Loss from continuing operations | $ | (0.02 | ) | $ | (0.02 | ) | $ | (0.07 | ) | $ | (0.08 | ) | ||||
| Net loss | $ | (0.02 | ) | $ | (0.02 | ) | $ | (0.07 | ) | $ | (0.08 | ) | ||||
| Shares used to compute basic and diluted net loss per share | 274,488 | 198,279 | 225,063 | 93,381 |
Condensed Balance Sheets
| September 30, 2012 | December 31, 2011 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 60,048 | $ | 17,974 | ||||
| Prepaid expenses and other current assets | 355 | 266 | ||||||
| Total current assets | 60,403 | 18,240 | ||||||
| Property and equipment, net | 1,228 | 1,075 | ||||||
| Other long-term assets | 130 | 130 | ||||||
| Total assets | $ | 61,761 | $ | 19,445 | ||||
| Liabilities and Stockholders Equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 1,758 | $ | 1,010 | ||||
| Accrued expenses | 1,033 | 1,498 | ||||||
| Accrued disposition costs | 1,088 | 1,082 | ||||||
| Convertible notes payable to related parties, net of discount | 365 | 103 | ||||||
| Total current liabilities | 4,244 | 3,693 | ||||||
| Stockholders equity: | ||||||||
| Common stock | 3,024 | 2,002 | ||||||
| Additional paid-in capital | 230,343 | 173,989 | ||||||
| Accumulated deficit | (175,850 | ) | (160,239 | ) | ||||
| Total stockholders equity | 57,517 | 15,752 | ||||||
| Total liabilities and stockholders equity | $ | 61,761 | $ | 19,445 |
Forward-looking Statements
This news release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties,
including uncertainties associated with the potential approval of APF530 and the potential timing for such approval, if approved at all, as well as risks relating to capital resources and liquidity, satisfactory completion of clinical studies,
progress in research and development programs, launch and acceptance of new products and other risks and uncertainties identified in the Company s filings with the Securities and Exchange Commission. We caution investors that forward-looking
statements reflect our analysis only on their stated date. We do not intend to update them except as required by law.
Investor Relations Contact:
Office Phone: 646-597-6979
John B. Whelan, President and Chief Executive Officer
Office Phone: 650-366-2626