- Recent Highlights Include Completion of
Enrollment in Phase 2a Trials of MEM 1003 and MEM 3454 - - Company Announces
Expansion of Pipeline to Include 5-HT6 Receptor Antagonist Program -MONTVALE, N.J., Aug 09, 2007 /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 three and six months ended June 30, 2007. At June 30, 2007,
the Company had cash, cash equivalents and marketable securities of
approximately $51.3 million, unchanged from December 31, 2006.
Memory Pharmaceuticals also announced today the expansion of its drug development pipeline to include a 5-HT6 Antagonist
Program. 5-HT6 antagonists are potential treatments for Alzheimer's disease,
schizophrenia, attention deficit disorder and obesity. 5-HT6 receptors are
found in brain areas involved in cognitive processes. Antagonism of these
receptors boosts activity in cognition circuits, producing increased
performance in animal models of learning and memory. Memory Pharmaceuticals has
internally developed a portfolio of novel, potent and selective 5-HT6
antagonists, which includes compounds that are covered by intellectual property
licensed from NPS Pharmaceuticals. The Company is evaluating several lead
compounds from this portfolio as potential development candidates.
"The first half of 2007 was a tremendously productive time for Memory Pharmaceuticals, and we believe that we are
well-positioned to build on this momentum as we approach key milestones in the
second half of this year," said Jim Sulat, President and Chief Executive
Officer. "Over the past several months, we completed enrollment in our Phase 2a
Alzheimer's disease trials for MEM 1003 and MEM 3454, established plans to
initiate a Phase 2a trial of MEM 3454 in cognitive impairment associated with
schizophrenia, or CIAS, later this year, enhanced our financial flexibility
through multiple initiatives and, most recently, expanded our pipeline to
include a 5-HT6 antagonist program. We are now focusing our attention on our
clinical goals for the second half of the year, including the initiation of a
Phase 1 trial for MEM 63908 and a Phase 2a trial of MEM 3454 in CIAS, and
top-line data announcements from our Phase 2a trials of MEM 1003 and MEM 3454
in Alzheimer's disease in the fourth quarter."
For the quarter ended June 30, 2007, the Company reported a net loss of $10.7 million, or $0.15 per share, compared to net
income of $1.6 million, or $0.04 per share, for the same period in 2006. Net
loss for the second quarter of 2007 included a non-cash charge of $0.8 million
related to stock-based compensation. Net income for the second quarter of 2006
included a non-cash gain of $7.8 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 stock- based compensation. For the quarter ended June 30,
2007, after removing the effect of the charge related to stock-based
compensation, the Company's non- GAAP net loss was $9.9 million, or $0.14 per
share. For the quarter ended June 30, 2006, after removing the effect of the
charge related to stock-based compensation and the unrealized gain on the
warrants issued in the Company's 2005 private placement, the Company's non-GAAP
net loss was $5.5 million, or $0.14 per share.
For the six months ended June 30, 2007, the Company reported a net loss of $19.6 million, or $0.27 per share, compared to a
net loss of $6.6 million, or $0.17 per share, for the same period in 2006. Net
loss for the six months ended June 30, 2007 included a non-cash charge of $1.7
million related to stock-based compensation. Net loss for the six months ended
June 30, 2006 included a non-cash gain of $5.5 million related to the warrants
issued in the Company's September 2005 private placement and a non-cash charge
of $1.4 million related to stock-based compensation. For the six months ended
June 30, 2007, after removing the effect of the charge related to stock-based
compensation, the Company's non-GAAP net loss was $17.9 million, or $0.25 per
share. For the six months ended June 30, 2006, after removing the effect of the
charge related to stock-based compensation and the unrealized gain on the
warrants issued in the Company's 2005 private placement, the Company's non-
GAAP net loss was $10.7 million, or $0.28 per share. A reconciliation of GAAP
to non-GAAP results is presented in the tables at the end of this press
release.
Prior to January 1, 2007, the fair value of the warrants issued in the Company's 2005 private placement was required to 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. Pursuant to the adoption of a recent accounting pronouncement,
as of January 1, 2007, the carrying value of these warrants was reclassified to
the equity section of the Company's Balance Sheet.
For the quarter ended June 30, 2007, the Company reported revenue of $2.7 million, compared to revenue of $1.9 million for
the same period in 2006. For the six months ended June 30, 2007, revenue was
$5.4 million, compared to revenue of $4.7 million for the same period in 2006.
To date, our revenue has been derived from our collaborations with Hoffmann
La-Roche and Amgen. This revenue includes the amortization of upfront
non-refundable fees and milestone payments, in addition to payments received
for research and development funding.
Research and development expenses for the quarter ended June 30, 2007 were $11.3 million compared to $6.4 million for the
same period in 2006. The $4.9 million increase includes $4.3 million in
increased costs associated with the clinical and preclinical development of MEM
1003 and MEM 3454, $0.4 million in increased personnel-related costs, $0.1
million in increased manufacturing costs and $0.1 million in increased
facility-related costs.
Research and development expense for the six months ended June 30, 2007 was $21.1 million compared to $13.2 million for the
six months ended June 30, 2006. The $7.9 million increase includes $7.0 million
in increased costs associated with the clinical and preclinical development of
MEM 1003 and MEM 3454, $0.4 million in increased manufacturing costs, $0.4
million in increased personnel-related costs and $0.1 million in increased
facility-related costs.
General and administrative expenses for the quarter ended June 30, 2007 were $2.6 million, compared to $2.1 million for the
same period in 2006. The $0.5 million increase includes $0.2 million in
increased legal and patent fees, $0.1 million in increased personnel-related
costs, $0.1 million in increased amortization expense related to our debt and
$0.1 million in increased administrative costs.
General and administrative expenses for the six months ended June 30, 2007 were $4.8 million compared to $4.3 million for
the six months ended June 30, 2006. The $0.5 million increase includes $0.3
million in personnel-related costs, $0.1 million in increased amortization
expense related to our debt and $0.1 million in increased administrative costs.
The Company expects that its existing cash, cash equivalents and marketable securities, together with payments required to
be made under its collaboration agreements, should be sufficient to fund
operating expenses, repayment of equipment notes and capital equipment
requirements into the second half of 2008.
Second Quarter Highlights and Recent Developments
-- Nicotinic Alpha-7 Agonist Program
Expanded Nicotinic Alpha-7 Alliance with Roche. In June 2007, Memory Pharmaceuticals expanded its nicotinic alpha-7 receptor
agonist agreement with Roche to support a Phase 2a CIAS trial of MEM 3454. The
expanded agreement provides that Roche would have to make an additional
milestone payment upon completion of the Phase 2a CIAS trial to maintain its
license to MEM 3454. The additional milestone payment, if made, is expected to
cover the expenses related to the Phase 2a CIAS trial of MEM 3454.
Established Plans for Phase 2a Trial of MEM 3454 in Schizophrenia. In June 2007, Memory Pharmaceuticals announced that it
plans to commence a Phase 2a proof-of-concept study of MEM 3454, the Company's
lead nicotinic alpha-7 partial agonist, for the treatment of CIAS in the fourth
quarter of 2007.
Completed Enrollment in Phase 2a MEM 3454 Alzheimer's Disease Trial. In July 2007, Memory Pharmaceuticals completed
enrollment in its Phase 2a trial of MEM 3454 in Alzheimer's disease. The trial
is a randomized, double-blind, placebo-controlled study designed to assess the
safety, tolerability and cognitive effects of three different doses of MEM
3454. The trial enrolled approximately 80 subjects with mild to moderate
Alzheimer's disease at multiple sites in the United States. The Company expects
to announce top-line data from the trial in the fourth quarter of 2007.
-- MEM 1003
Completed Enrollment in Phase 2a MEM 1003 Alzheimer's Disease Trial. In April 2007, Memory Pharmaceuticals completed
enrollment in its Phase 2a trial of MEM 1003 in Alzheimer's disease. The
multi-center, randomized, double- blind, placebo-controlled study enrolled
approximately 180 subjects with mild to moderate Alzheimer's disease at over 50
centers in the United States and is designed to evaluate the safety and
efficacy of two different doses of MEM 1003. The Company expects to announce
top-line data from the trial in the fourth quarter of 2007.
-- PDE4 Inhibitor Program
Restructured Roche PDE4 Agreement. In June 2007, Memory Pharmaceuticals restructured its PDE4 inhibitor collaboration with
Roche, providing the Company with the opportunity to more rapidly advance this
program. Under the terms of the restructured agreement, the Company regained
all worldwide rights to the PDE4 program and Roche relinquished all license and
options rights to the program, including those related to MEM 1414 and MEM
1917. Memory Pharmaceuticals has agreed to make milestone payments to Roche
upon the achievement of development, regulatory and sales events of PDE4
compounds and to pay royalties to Roche on worldwide sales of any marketed
products from the PDE4 program.
-- Financial Position
Secured Additional $5.0 Million in Debt Financing. In June 2007, the Company amended its term loan agreement with Hercules
Technology Growth Capital, Inc. to increase the aggregate amount the Company
can borrow from $10.0 million to $15.0 million. Hercules has advanced a total
of $11.0 million to the Company to date under the loan agreement. From
September 15, 2007, through December, 31, 2007, Memory Pharmaceuticals has the
option to request the remaining $4.0 million available under the loan
agreement.
Entered into Equity Funding Led by SMRI. In June 2007, Memory Pharmaceuticals entered into an agreement for the sale of up
to $6.0 million of its common stock, principally to The Stanley Medical
Research Institute (SMRI). The three-tranche equity financing will be priced at
a 17 % premium to the Company's stock price at the time of each tranche and
will help fund the Company's Phase 2a CIAS trial of MEM 3454. The first tranche
of $2.0 million closed on June 20, 2007. The Company has the option to take
down the second and third tranches upon the achievement of specified milestones
during the trial.
Conference Call and Webcast Information
Memory Pharmaceuticals will hold a conference call on Thursday, August 9, 2007, at 9:00 a.m. EDT to discuss the Company's
second quarter 2007 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, August 9, 2007
Time: 9:00 a.m. EDT
Telephone (U.S.): 866.713.8565
Telephone (international): 617.597.5324
Participant Passcode: 77253492
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, August 9, 2007, until Thursday,
August 16, 2007. To access the replay, please dial 888.286.8010 (U.S.) or
617.801.6888 (international) and enter passcode number 58601384. 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
outcome of clinical trials of Memory Pharmaceuticals' drug candidates and
whether they demonstrate these candidates' safety and effectiveness; the risks
and uncertainties associated with: obtaining additional financing to support
Memory Pharmaceuticals' R&D and clinical activities and operations;
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 relationships; achieving milestones under Memory
Pharmaceuticals' collaborations; Memory Pharmaceuticals' dependence on
preclinical and clinical investigators, preclinical and 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 & NON-GAAP ADJUSTMENTS
(in thousands - except share and per share information)
(unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2007 2006 2007 2006
Revenue $2,728 $1,944 $5,418 $4,724
Operating expenses:
Research and development 11,258 6,379 21,108 13,220
General and administrative 2,593 2,063 4,846 4,301
Total operating expenses 13,851 8,442 25,954 17,521
Loss from operations (11,123) (6,498) (20,536) (12,797)
Change in fair value of warrants - 7,753 - 5,493
Interest income, net 440 369 992 747
Net income/(loss) before
income taxes (10,683) 1,624 (19,544) (6,557)
Income taxes 6 - 6 -
Net income/(loss) $(10,689) $1,624 $(19,550) $(6,557)
Net income/(loss) per common share:
Basic net income/(loss) $(0.15) $0.04 $(0.27) $(0.17)
Diluted net income/(loss) $(0.15) $0.04 $(0.27) $(0.17)
Basic weighted average number
of shares of common stock
outstanding 72,098,338 37,836,343 71,121,965 37,790,868
Diluted weighted average
number of shares of common
stock outstanding 72,098,338 38,415,846 71,121,965 37,790,868
Non-GAAP Adjustments:
Net income/(loss) $(10,689) $1,624 $(19,550) $(6,557)
Unrealized (gain)/loss
on warrants - (7,753) - (5,493)
Non-cash compensation charge
associated with share-based
payments 806 673 1,655 1,389
Non-GAAP net loss(1) $(9,883) $(5,456) $(17,895) $(10,661)
Non-GAAP basic and diluted
net loss per share(1) $(0.14) $(0.14) $(0.25) $(0.28)
(1) Excludes gains or losses on the warrants issued in the 2005 private
placement and the expense associated with share-based payments.
MEMORY PHARMACEUTICALS CORP.
CONDENSED BALANCE SHEETS
(in thousands)
(unaudited)
June 30, December 31,
2007 2006
ASSETS
Cash, cash equivalents and marketable securities $51,338 $51,323
Other current assets 1,332 1,397
Restricted cash 505 509
Deferred financing costs 542 -
Property and equipment, net 6,656 7,413
Total assets $60,373 $60,642
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities (excluding deferred revenue) $9,369 $7,664
Warrant liability - 8,724
Equipment notes payable, less current portion 197 345
Loan payable 9,243 -
Deferred revenue 18,704 20,707
Total liabilities 37,513 37,440
Stockholders' equity 22,860 23,202
Total liabilities and stockholders' equity $60,373 $60,642
SOURCE Memory Pharmaceuticals Corp.
Jzaneen Lalani, General Counsel, +1-201-802-7249; or Laura Perry of Stern Investor
Relations, +1-212-362-1200, both for Memory Pharmaceuticals Corp.
http://www.memorypharma.com
