Company Provides Update on Ongoing Operations and
Efforts to Maximize Shareholder Value
$30 Million in Cash Expected at December 31, 2007
Conference Call to be Held Today at 1:30 P.M. PT/4:30 P.M. ET
BOTHELL, Wash., Nov. 12, 2007 (PRIME NEWSWIRE) -- Sonus Pharmaceuticals, Inc. (Nasdaq:SNUS) today reported financial results for the third quarter of 2007. In addition, the Company provided an update on its ongoing operations and strategic initiatives. At 1:30 P.M. PT/4:30 P.M. ET today, Sonus will host its quarterly conference call.
"In the seven weeks since we reported the highly disappointing Phase 3 pivotal trial results of TOCOSOL(r) Paclitaxel, our team has worked hard to further analyze the trial data, evaluate realistic options for the product, and re-focus our efforts on our strongest drug development programs and opportunities," said Michael A. Martino, President and Chief Executive Officer of Sonus Pharmaceuticals. "We have implemented several decisions during this time frame as a result of these new circumstances. Based on our analysis of the Phase 3 pivotal trial data, as well as our current commercial assessment, we have terminated the TOCOSOL Paclitaxel development program and we are currently examining potential alternative strategies for the product, including out-licensing. We have also examined the Phase 3 trial results of TOCOSOL Paclitaxel as they may relate to SN2310, and have concluded that none of the results impact the SN2310 program. Hence, enrollment in the SN2310 Phase 1 trial is ongoing."
"In addition, we have begun implementing cost-savings strategies, including streamlining our research, development, clinical, regulatory, biostatistics and administrative staffs," Mr. Martino continued. "This effort has resulted in the elimination of 16 positions, including four at the vice president level. Our goal through these actions is to preserve both cash and the critical capabilities necessary to pursue our highest potential product development programs. Additionally, we have enlisted the services of Ferghana Partners, and are actively assessing alternatives to leverage our pipeline, capabilities, infrastructure and cash to maximize value," Mr. Martino concluded.
As of September 30, 2007, cash and investments totaled $40.7 million. The Company expects to finish fiscal 2007 with approximately $30 million in cash. Based on current operations, the Company has sufficient cash to fund operations through the third quarter of 2009.
Third Quarter 2007 Financial Results
For the third quarter of 2007, Sonus reported a net loss of $5.8 million, or $0.16 per share, an 8% improvement from a net loss of $6.3 million, or $0.17 per share, in the third quarter of 2006.
For the first nine months of 2007, the Company reported a net loss of $15.0 million, or $0.41 per share, compared with a net loss of $16.5 million, or $0.49 per share, in the same period of 2006. The lower net loss for the first nine months of 2007 is primarily due to reduced expenses related to the Phase 3 pivotal trial for TOCOSOL Paclitaxel and reduced manufacturing costs. These lower expenses also resulted in reduced reimbursement revenue from Bayer Schering.
For the third quarter of 2007, the Company recognized $4.1 million in revenue under its collaboration agreement with Bayer Schering, including $2.7 million from reimbursable expenses for work related to the development of TOCOSOL Paclitaxel and $1.4 million for amortization of the upfront license fee that Sonus received under its agreement with Bayer Schering.
For the first nine months of 2007, the Company recognized $12.4 million in revenue under its collaboration agreement with Bayer Schering, including $8.3 million from reimbursable expenses for work related to the development of TOCOSOL Paclitaxel and $4.1 million for amortization of the upfront license fee that Sonus received under its agreement with Bayer Schering. Due to the termination of the agreement by Bayer Schering on October 3, 2007, the Company will recognize $6.9 million in revenue for the fourth quarter of 2007, which represents the balance of the unamortized deferred revenue from the upfront license fee. There will also be a final net billing to Bayer Schering in the fourth quarter for accrued expenses related primarily to reimbursable expenses from the Phase 3 trial through the date of termination and expenses associated with the termination of the Phase 3 trial. The Company does not expect recognition of any revenue related to the agreement with Bayer Schering beyond 2007.
Conference Call Information
The quarterly conference call will be webcast live on November 12 at 1:30 P.M. PT/4:30 P.M. ET and can be accessed at http://ir.sonuspharma.com/events.cfm. The call will be archived at the same link. A telephone replay will be available on November 12 at 3:30 P.M. PT/6:30 P.M. ET for one week at 800-405-2236 or 303-590-3000 for international calls; Passcode: 11101278.
About Sonus Pharmaceuticals
Headquartered near Seattle, Washington, Sonus Pharmaceuticals, Inc. is focused on the development of cancer drugs that are designed to provide better efficacy, safety and tolerability, and ease of use. Sonus moved its second oncology product candidate, SN2310, into a Phase 1 clinical trial in September 2006. For additional information on Sonus, including past news releases, please visit www.sonuspharma.com.
Safe Harbor
Certain statements made in this press release are forward-looking such as those, among others, relating to the development, safety and efficacy of therapeutic drugs and potential applications for these products. As discussed in Sonus Pharmaceuticals' filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for 2006 and subsequent Quarterly Reports on Form 10-Q, actual results could differ materially from those projected in the forward-looking statements as a result of the following factors, among others: the Company's products will require extensive clinical testing and approval by regulatory authorities; such approvals are lengthy and expensive and may never occur; risks that the Phase 1 clinical trial for SN2310 will not be successful; risks that strategic opportunities relating to our pipeline and other capabilities may not be available, or, even if available, may not be consummated; and risks that the Company may not be successful in obtaining funding from third parties or completing a financing necessary to support the costs and expenses of clinical studies as well as research and development activities. The Company undertakes no obligation to update the forward-looking statements contained herein or to reflect events or circumstances occurring after the date hereof.
Condensed Statements of Operations
(Unaudited)
(in thousands, except per share amounts)
Three Months Ended Nine Months Ended
September 30, September 30,
-------------------- --------------------
2007 2006 2007 2006
--------- --------- --------- ---------
Collaboration revenue
from related party $ 4,079 $ 4,931 $ 12,401 $ 16,498
Operating expenses:
Research and
development 8,871 10,281 23,506 29,640
General and
administrative 1,562 1,786 5,666 5,442
--------- --------- --------- ---------
Total operating expenses 10,433 12,067 29,172 35,082
--------- --------- --------- ---------
Operating loss (6,354) (7,136) (16,771) (18,584)
Other income, net 546 843 1,775 2,045
--------- --------- --------- ---------
Net loss $ (5,808) $ (6,293) $ (14,996) $ (16,539)
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Net loss per share:
Basic & diluted $ (0.16) $ (0.17) $ (0.41) $ (0.49)
Shares used in
calculation:
Basic & diluted 36,925 36,974 36,888 34,036
Condensed Balance Sheets
(in thousands)
Sept. 30, Dec. 31,
2007 2006
-------- --------
(unaudited)
Assets:
Cash, cash equivalents and
marketable securities $ 40,665 $ 58,278
Accounts receivable from related
party 4,577 8,044
Other current assets 1,291 524
Property and equipment, net 1,352 1,186
Other assets 440 461
-------- --------
Total assets $ 48,325 $ 68,493
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Liabilities and stockholders' equity:
Accounts payable $ 292 $ 898
Accounts payable with related party 2,630 1,473
Accrued expenses 8,889 11,928
Other current liabilities -- 65
Deferred revenue from related party 6,927 11,087
Stockholders' equity 29,587 43,042
-------- --------
Total liabilities and stockholders'
equity $ 48,325 $ 68,493
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