MONTVALE, N.J., May 11, 2006 /PRNewswire-FirstCall via COMTEX News Network/ -- Memory Pharmaceuticals
Corp. (Nasdaq: MEMY), a biopharmaceutical company focused on the discovery and
development of innovative drug candidates for the treatment of a broad range
of central nervous system (CNS) conditions, today reported its financial
results for the quarter ended March 31, 2006.
"Since the beginning of the year, we have advanced our clinical
development programs for our two lead candidates, MEM 1003 and MEM 3454,
paving the way for the initiation of two important proof of concept trials in
the second quarter," said Jim Sulat, President and Chief Executive Officer.
"We look forward to expanding our clinical experience with MEM 1003, our
L-type calcium channel modulator, through our Phase 2a trial in acute mania in
bipolar disorder. In addition, based on the recent positive data from our
Phase 1 trial for our lead nicotinic alpha-7 receptor agonist, MEM 3454, we
plan to commence a Phase 2a trial in Alzheimer's disease."
For the three months ended March 31, 2006, the Company reported a net loss
according to generally accepted accounting principles (GAAP) of $8.2 million,
or $0.22 per share of common stock, compared to $8.4 million, or $0.41 per
share of common stock, for the comparable period in 2005. This net loss
includes a non-cash loss of $2.3 million related to the warrants issued in the
Company's September 2005 private placement and a non-cash charge of $0.7
million related to the Company's adoption, on January 1, 2006, of Statement of
Financial Accounting Standards 123R, "Share-based Payments" (SFAS 123R). For
the three months ended March 31, 2006, the Company reported a non-GAAP net
loss of $5.2 million, or $0.14 per share of common stock.
In connection with the Company's September 2005 private placement, the
Company agreed to file a registration statement with the Securities and
Exchange Commission to register for resale the shares of common stock, and the
shares of common stock issuable upon the exercise of the warrants, sold in the
private placement. The Company is required to keep this registration statement
effective for a maximum of two years and will be required to pay certain cash
penalties if it does not meet its registration obligations. As a result of the
potential for penalties if the Company fails to meet this obligation, GAAP
requires that the fair value of the warrants issued in the private placement
be classified as a liability on the Company's Balance Sheet, with the change
in fair value recognized in the Company's Statement of Operations as
unrealized gains or losses. In calculating non-GAAP earnings, management
excludes any unrealized gains or losses on the warrants in addition to the
expense associated with SFAS 123R. A reconciliation of GAAP to non-GAAP
earnings is presented in the tables at the end of this press release.
The Company believes that certain non-GAAP measures, when presented in
conjunction with comparable GAAP measures, are useful for evaluating the
Company's operating performance. Internally, the Company uses this non-GAAP
information as an indicator of business performance and evaluates management's
effectiveness with specific reference to these indicators. Non-GAAP measures
should be considered in addition to, not as a substitute for, or superior to,
measures of financial performance prepared in accordance with GAAP.
For the three months ended March 31, 2006, the Company reported revenue of
$2.8 million compared to revenue of $2.4 million for the same period in 2005.
Revenue relates to the Company's 2002 and 2003 agreements with Hoffmann La-
Roche for the development of PDE4 inhibitors and nicotinic alpha-7 agonists,
respectively, and the Company's 2005 agreement with Amgen for the development
of PDE10 inhibitors.
Research and development expenses for the first quarter of 2006 were $6.8
million compared to $8.9 million for the comparable period in 2005. The
current period includes a non-cash charge of $0.3 million related to the
Company's compliance with SFAS 123R that was offset by reduced spending of
$2.2 million on clinical and outside research cost and $0.2 million relating
to personnel cost and lab supplies.
General and administrative expenses for the three months ended March 31,
2006 were $2.2 million, compared to $2.1 million for the comparable period in
2005. The current period includes a non-cash charge of $0.4 million related to
the Company's compliance with SFAS 123R that was partially offset by reduced
personnel related cost of $0.2 million.
At March 31, 2006, the Company had cash, cash equivalents and marketable
securities of approximately $36.5 million, compared to $44.1 million at
December 31, 2005. The Company expects that its existing cash, cash
equivalents, and marketable securities, together with payments required to be
made under its collaboration agreements, will be sufficient to fund operating
expenses, repayment of equipment notes, and capital equipment requirements
through the first quarter of 2007.
First Quarter Highlights and Recent Developments
-- Completed Phase 1 trial for MEM 3454:
In February 2006, Memory Pharmaceuticals completed dosing in its Phase 1
clinical trial of MEM 3454, its lead nicotinic alpha-7 receptor agonist, in
healthy volunteers. MEM 3454 was safe and generally well-tolerated up to a
dose of 450 mg in the single ascending dose segment and up to a dose of 150 mg
in the multiple ascending dose (MAD) segment. In addition, cognition data
generated in the MAD study, using the Cognitive Drug Research battery,
demonstrated that a 15 milligram dose of MEM 3454, administered once daily for
a period of 13 days showed a statistically significant effect on the Quality
of Episodic Secondary Memory, one of the study's primary efficacy variables.
The Company expects to begin a Phase 2a clinical trial of MEM 3454 in
Alzheimer's disease in June 2006.
-- Amended Agreement with Roche to Expand Resources for Nicotinic Alpha-7
Agonists:
In February 2006, Memory Pharmaceuticals amended its strategic alliance
agreement with Roche, providing for both companies to collaborate on the
discovery and clinical development of nicotinic alpha-7 agonists. Memory
Pharmaceuticals granted Roche an exclusive worldwide license to its
intellectual property on nicotinic alpha-7 receptor compounds. Excluded from
this license is MEM 3454, which will remain under the terms of the original
option agreement. Memory Pharmaceuticals has the potential to receive
approximately $2.3 million in research funding during 2007 based upon the
achievement of defined preclinical milestones and will receive milestone
payments upon the achievement of development, regulatory and sales events for
drug candidates that progress under the collaboration.
Conference Call and Webcast Information
Memory Pharmaceuticals will hold a conference call on Thursday, May 11,
2006, at 9:00 a.m. EDT to discuss the Company's first quarter 2006 financial
results. The conference call will also be broadcast live from the "Investors"
section of the Company's website. Memory Pharmaceuticals' senior management
will host the conference call. Investors and other interested parties may
access the call as follows:
Date: Thursday, May 11, 2006
Time: 9:00 a.m. EDT
Telephone (U.S.): 866-203-3436
Telephone (international): 617-213-8849
Participant Passcode: 59889999
Webcast: http://www.memorypharma.com under the
"Investors" section
An audio replay of the conference call will be available from 11:00 a.m.
EDT on Thursday, May 11, 2006, until Thursday, May 18, 2006. To access the
replay, please dial 888-286-8010 (U.S.) or 617-801-6888 (international) and
enter passcode number 12047110. An audio replay of the conference call will
also be available under the "Investors" section of the Company's website
during the same period.
About the Company
Memory Pharmaceuticals Corp., a biopharmaceutical company, is focused on
developing innovative drugs for the treatment of debilitating CNS disorders
such as Alzheimer's disease, schizophrenia, depression and bipolar disorder.
For additional information, please visit our website at
http://www.memorypharma.com.
Safe Harbor Statement
This press release contains forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995 that are subject to
risks and uncertainties. All statements, other than statements of historical
facts, regarding management's expectations, beliefs, goals, plans or Memory
Pharmaceuticals' prospects, future financial position, future revenues and
projected costs should be considered forward-looking. Readers are cautioned
that actual results may differ materially from projections or estimates due to
a variety of important factors, including the risks and uncertainties
associated with: obtaining additional financing to support Memory
Pharmaceuticals' R&D and clinical activities and operations; conducting
preclinical and clinical trials of Memory Pharmaceuticals' drug candidates
that demonstrate these candidates' safety and effectiveness; obtaining
regulatory approvals to conduct clinical trials and to commercialize Memory
Pharmaceuticals' drug candidates; Memory Pharmaceuticals' ability to enter
into and maintain collaborations with third parties for its drug development
programs; Memory Pharmaceuticals' dependence on its collaborations and its
license relationship with Bayer; achieving milestones under Memory
Pharmaceuticals' collaborations; Memory Pharmaceuticals' dependence on third-
party preclinical or clinical research organizations, manufacturers and
consultants; and protecting the intellectual property developed by or licensed
to Memory Pharmaceuticals. These and other risks are described in greater
detail in Memory Pharmaceuticals' filings with the Securities and Exchange
Commission. Memory Pharmaceuticals may not actually achieve the goals or plans
described in its forward-looking statements, and investors should not place
undue reliance on these statements. Memory Pharmaceuticals disclaims any
intent or obligation to update any forward-looking statements as a result of
developments occurring after the date of this press release.
MEMORY PHARMACEUTICALS CORP.
CONDENSED STATEMENTS OF OPERATIONS
(in thousands - except share and per share information)
(unaudited)
Three Months Ended
March 31,
2006 2005
Revenue $2,780 $2,430
Operating expenses:
Research and development 6,843 8,926
General and administrative 2,238 2,086
Total operating expenses 9,081 11,012
Loss from operations (6,301) (8,582)
Change in fair value of warrants (2,260) -
Interest income, net 382 135
Net loss before income taxes (8,179) (8,447)
Income taxes 2 2
Net loss attributable to common stockholders $(8,181) $(8,449)
Basic and diluted net loss per share of common
stock $(0.22) $(0.41)
Basic and diluted weighted average number of
shares of common stock outstanding 37,745,394 20,689,320
Non-GAAP net loss attributable to common
stockholders (1) $(5,205) $(8,449)
Non-GAAP basic and diluted net loss per share of
common stock (1) $(0.14) $(0.41)
(1) Non-GAAP net loss and per share amounts for the three month period
ended March 31, 2006, is adjusted by $2,260, representing the
unrealized loss on the warrants, and $716, representing the cost to
the company associated with SFAS 123R.
MEMORY PHARMACEUTICALS CORP.
CONDENSED BALANCE SHEETS
(in thousands)
(unaudited)
March 31, December 31,
2006 2005
ASSETS
Cash, cash equivalents and marketable
securities $36,508 $44,079
Other current assets 1,861 2,562
Restricted cash 505 505
Property and equipment, net 8,772 9,167
Total assets $47,646 $56,313
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities (excluding deferred
revenue) $4,539 $5,901
Warrant Liability 10,738 8,477
Equipment notes payable, less current portion 854 1,089
Deferred revenue 17,940 19,895
Total liabilities 34,071 35,362
Stockholders' equity 13,575 20,951
Total liabilities and stockholders'
equity $47,646 $56,313
SOURCE Memory Pharmaceuticals Corp.
Jzaneen Lalani, Vice President, Legal Affairs, Memory Pharmaceuticals Corp.,
+1-201-802-7249; or Laura Perry, of Stern Investor Relations, +1-212-362-1200, for
Memory Pharmaceuticals Corp.
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