Announcement
27.04.2011
Below please find the first part of the Q1 report 2001. The full report is available in the enclosed PDF file.
----------
Today, the Board of Directors of NeuroSearch A/S (NEUR) considered and approved the company’s interim report for the period 1 January to 31 March 2011.
An operating loss of DKK 82 million (a loss of DKK 80 million in the same period 2010) was reported. The financial net income after tax showed a loss of DKK 93 million (a loss of DKK 57 million in the same period 2010). In connection with the restructuring of NeuroSearch that was announced in January this year, a one-off charge of DKK 15 million is included in the Q1 results. This primarily relates to the costs incurred with respect to those employees who left the company.
The company’s capital resources, including securities, totalled DKK 412 million at 31 March 2011 (DKK 767 million at 31 March 2010). The securities primarily consist of highly liquid short-term bonds. In addition, NeuroSearch has contingent future payments from the company's collaboration partners, Lilly and Janssen, of DKK 64 million, and unused credits of DKK 29 million.
Important events and activities in the first quarter of 2011 and until today:
Restructuring of the organisation
-
In January 2011, NeuroSearch announced a restructuring of the company. The restructuring has been carried out in order for NeuroSearch to pursue the strategic objective of becoming a profitable CNS specialty pharma business In connection with the restructuring, the company's ion channel drug discovery and existing partner alliances were pooled in a single business unit, NsDiscovery.
-
NeuroSearch is steadily building up commercial competences to prepare for the marketing of Huntexil® (pridopidine), our drug candidate for the treatment of patients suffering from Huntington's disease.
-
Cost reductions, including the staff reduction of approximately 20%, is expected to reduce the company's total annual costs with full effect as of 2012. The staff reductions were actioned as planned, and we are pleased to learn that many of our former colleagues have already found alternative employment. The remaining employees have dealt with the changes in a professional way and have contributed to the successful implementation of the new structure.
- The Management has been restructured to reflect the company's challenges.
Huntexil® (pridopidine) – Huntington's disease
-
During March 2011, NeuroSearch held an End of Phase II meeting with the US authorities (FDA), following the closing of the North American Phase II study. NeuroSearch presented the full data package for Huntexil® (pridopidine) and the feedback from the FDA, which has now been received in writing, was that confirmatory clinical data, including a confirmatory Phase III programme, will be required for a submission for marketing authorisation in the US.
-
NeuroSearch has submitted a data package to the European health authorities (EMA) with a view to obtaining scientific counsel, and expect feedback from the EMA during Q2.
-
To ensure the optimal continued clinical development programme for Huntexil®, the responses from both the FDA and EMA to the Huntexil® data package will form the basis for the company's decision regarding selection of one of our prepared development scenarios.
-
At the beginning of April, NeuroSearch announced that the first patient had been enrolled in the open extension study, Open HART. The extension study is open to patients who participated in the HART study, the North American Phase IIb study, and will contribute further data in support of the safety profile of Huntexil®.
Ordopidine and seridopidine
-
NeuroSearch has other drug candidates belonging to the class of dopidines. These drug candidates are characterised by their ability to stabilise the dopamine dependant functions in the brain.
-
Ordopidine is under evaluation in a clinical Phase Ib study that is investigating the safety and tolerability of the compound in Parkinsons patients with L-DOPA induced dyskinesia. During the second half of 2011, we expect to conclude the current study and then decide upon a possible initiation of a Phase II programme.
- Seridopine is being evaluated in a Phase I study which we expect will be concluded in the second quarter of 2011, after which the data will be evaluated in order to decide upon design and possible start of a Phase II study by the end of 2011.
Tesofensine – For the treatment of overweight and obesity
-
The Phase II study of tesofensine demonstrated a placebo-corrected weight loss of up to 10% over a period of six months. This is acknowledged to be one of the most significant reductions in weight that has been reported among weight reducing compounds used as monotherapy. Compounds for the treatment of overweight and obesity have faced increasing safety requirements from the authorities, and this has led to requirements for extensive safety studies with respect to effect on the cardiovascular system. Discussions are ongoing with both the US and the European health authorities as to the design and extent of the Phase III programme. The final result of these discussions will be available in Q2 2011.
- The considerable costs involved in undertaking a Phase III study have led NeuroSearch to ready the programme for collaboration with a partner.
Drug discovery and development alliances with Lilly and Janssen
-
The drug discovery programmes under the NeuroSearch-Lilly collaboration progress satisfactorily. Together with Lilly, we have agreed upon focusing our efforts on fewer drug discovery and development programmes. It is our intention that this focus combined with the results we have already achieved, will speed up the selection of drug candidates under the collaboration agreement that was initiated in February 2009. It exploits both partners' joint experience within the field of drug discovery and drug development and provides NeuroSearch with a total contingent financing of USD 30 million, inclusive of an equity investment of USD 17 million.
- The collaboration with Janssen progresses as planned, and it is our expectation that the first clinical development candidate under the alliance will be selected this year. The collaboration was initiated in August 2009 and is based on joint experience within neuroscientific drug discovery and drug development. The agreement provides NeuroSearch a total contingent financing of EUR 32 million which includes an equity investment of EUR 15 million.
Outlook for 2011
NeuroSearch maintains the company's financial expectations for the full financial year 2011, with an expected loss before financials and other shares of result in the region of DKK 325 million.
In connection with the announcement of the Q1 interim report for 2011, CEO of NeuroSearch Patrik Dahlen, stated:
“Following feedback from the FDA, we now await the advice of the European health authorities in order to determine the best possible clinical development programme for Huntexil®. The authorities have been very constructive in their approach and also in their clarification of requirements for NeuroSearch to obtain approval of Huntexil®. We remain highly committed to the development and marketing of Huntexil® for the benefit of patients, society and shareholders."
Having completed the first quarter, Thomas Varming, EVP of NsDiscovery, said:
"NsDiscovery was established on the foundation of many years of research, which has contributed important findings regarding the role of ion channels in relation to disease and health. With their understanding of the modulation of ion channels, our researchers have succeeded in attracting partnerships from large research based pharmaceutical companies worldwide. We remain committed to distinguishing ourselves as an attractive collaboration partner for these companies. Our present partnerships with Eli Lilly and Janssen run well, and we look forward to our continued collaboration. At the same time, we are optimistic that we will attract new partners.
Patrik Dahlen
CEO
Contact persons:
Patrik Dahlen, CEO, telephone: +45 4460 8214 or +45 2629 7296
René Schneider, Executive Vice President & CFO, telephone: +45 4460 8700 or +45 2911 2097
This interim report will be presented at the company's Annual General Meeting, which will be held today at 4.00 pm at the Radisson Blu Falconer Hotel & Conference Center, Falkoner Allé 9, DK-2000 Frederiksberg.
About NeuroSearch – Company profile
NeuroSearch (NEUR) is a European based biopharmaceutical company, specialising in CNS diseases, and listed on NASDAQ OMX Copenhagen A/S. The company has a pipeline of speciality CNS drugs, including Huntexil® (pridopidine), a unique orphan drug in Phase III for the treatment of Huntington’s disease. NeuroSearch is building commercial competences with a view to commercialising Huntexil® through an in-house marketing and sales organisation.
NeuroSearch has a well-established drug discovery division, NsDiscovery, with unique capabilities in the field of ion channels and CNS diseases. The company has strategic drug discovery and development alliances with Janssen Pharmaceutica and Eli Lilly as well as a licence collaboration with Abbott. NeuroSearch also has equity interests in a number of unlisted companies in the Life Science industry.
