NeuroSearch A/S - H1 Report 2011


Announcement
25 August 2011


Below please find the first part of the NeuroSearch H1 2011 report. The full report is included in the enclosed PDF file.

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The Board of Directors of NeuroSearch A/S (NEUR) today considered and adopted the company’s interim report for the six months ended 30 June 2011. An operating loss of DKK 143 million was reported for the period (H1 2010: a loss of DKK 168 million).

The loss after tax was DKK 148 million (H1 2010: a loss of DKK 120 million). Net financials for the period amounted to DKK 5 million (H1 2010: net income of DKK 19 million).

As of 30 June 2011, the company’s cash and cash equivalents including securities totalled DKK 352 million. Securities primarily consist of highly liquid short-term bonds. In addition, NeuroSearch will receive a total of DKK 54 million in payments for staff working on projects under the alliance with Janssen. Moreover, the company has unused credits of DKK 15 million.

In this interim report, the company publishes for the first time segment information for its two businesses: Specialty Pharma and NsDiscovery. Specialty Pharma is the company’s specialty pharma business focused on completing the development and marketing of Huntexil®. NsDiscovery is managing the company’s early drug discovery, out-licensing of product candidates targeting non-specialist indications and the company’s partnerships.

Specialty Pharma reported an operating loss of DKK 90 million for the period (H1 2010: a loss of DKK 112 million), which was primarily related to the development of Huntexil® and related employees in the drug development organisation, research activities on early projects as well as a relative share of group administrative and infrastructure costs.

NsDiscovery reported an operating loss of DKK 53 million for the period (H1 2010: a loss of DKK 56 million)
, primarily related to revenue and cost from the Lilly and Janssen agreements and related employees in the research organisation, as well as a relative share of group administrative and infrastructure costs.

Outlook for 2011
For the full year 2011, NeuroSearch adjusts its guidance to an operating loss of approximately DKK 300 million against the previous guidance of a loss of approximately DKK 325 million. The improvement is primarily due to lower-than-expected development costs for Huntexil®.

Important events in Q2

  • NeuroSearch announced that the FDA’s and the EMA’s scientific advice regarding the clinical development programme for Huntexil® stated that a new Phase III study will be necessary to support an application for marketing approval. Both regulatory authorities have supported the use of total motor score (TMS) as the primary endpoint. The Phase IIb and III studies HART and MermaiHD have shown significant improvement of TMS in patients with Huntington’s disease undergoing treatment with Huntexil®. The details of the development programme will be finalised and announced in Q3 2011.
     
  • The first patient from the HART Phase IIb clinical study was enrolled in the Open HART safety extension study. Open HART was planned and initiated at the request of patients who had completed the HART study and expressed a desire to continue treatment with Huntexil®. As of 22 August 2011, 78 patients had enrolled in the Open HART study.
     
  • The compassionate use program, that followed the six-month open-label extension of the MermaiHD study, currently includes 129 patients receiving Huntexil®.
     
  • NeuroSearch announced the conclusions of the scientific advice from the FDA and the EMA regarding the development programme for tesofensine for the treatment of overweight and obesity. This clarified the framework for a Phase III development programme for the period until registration. NeuroSearch is looking for a partner for the completion of the development and commercialisation of tesofensine.
     
  • In May, NeuroSearch extended the existing partnership agreement with Janssen until August 2013. The total payments to NeuroSearch under the agreement are unchanged.


Events after the balance sheet date

  • On 7 July 2011, NeuroSearch sold its 30.1% stake in Sophion Bioscience A/S when Biolin Scientific AB took over full ownership of Sophion. The company’s proceeds amount to approximately DKK 40 million, of which DKK 37 million are expected to be received in Q3 2011 and the remaining DKK 3 million before the end of 2012. The proceeds will affect net financials in the Q3 income statement with approximately DKK 32 million recognised as income from the divestment of an associated company.
     
  • Preliminary data for seridopidine and ordopidine has revealed a metabolite which requires further toxicological studies. NeuroSearch therefore postpones Proof of Concept studies until 2012. These findings do not influence the ongoing development of Huntexil®.

     

Patrik Dahlen
CEO



Telephone conference
NeuroSearch will host a telephone conference today at 3.00 pm CET (2 pm UK time, 9 am New York time) at which the interim report for the six months ended 30 June 2011 will be reviewed. Patrik Dahlen, CEO, and René Schneider, EVP & CFO, will participate in the conference, which will be conducted in English and with access via the following telephone numbers: UK and international +44 207 509 5139, US +1 718 354 1226 and Denmark +45 3271 4767. The conference call can also be accessed via the company's website www.neurosearch.com.

The corresponding presentation will be available at the company's website just prior to the teleconference.


Contact persons
Patrik Dahlen, CEO, telephone: +45 4460 8214 or +45 2629 7296
René Schneider, EVP & CFO, telephone: +45 4460 8700 or +45 2911 2097



About NeuroSearch
NeuroSearch A/S is a European-based biopharmaceutical company listed on NASDAQ OMX Copenhagen A/S (NEUR) and specialising in central nervous system (CNS) disorders. The company consists of two independent businesses. Specialty Pharma is the company’s specialty pharma business focused on completing the development and marketing of Huntexil®, a unique drug in Phase III for the treatment of the motor symptoms of Huntington’s disease. NsDiscovery is managing the company’s early drug discovery and research, out-licensing of product candidates targeting non-specialist indications, and the company’s partnerships. The company has strategic research and development alliances with Janssen and Lilly as well as a licence agreement with Abbott.

 

Building, NeuroSearch A/S