Denosumab superior to Zometa in preventing SREs in breast cancer patients with bone metastases: Study

October 30, 2015

The Company recognized revenue of $0.3 million during the third quarter of 2010, compared with $0.1 million during the third quarter of 2009. The Company recognized revenue of $0.7 million during the nine months ended September 30, 2010, compared with $0.3 million during the nine months ended September 30, 2009. For the third quarter of 2010, revenue consisted primarily of the recognition of license fee payments previously received from the Company's strategic alliances, revenues from the sales of Ceplene? to Meda and product royalties. For the third quarter of 2009, revenue consisted primarily of the recognition of license fee payments previously received from the Company's strategic alliances.

Selling, General and Administrative Expense

Selling, general and administrative expense in each of the third quarters of 2010 and 2009 was $1.9 million. Selling, general and administrative expense in both of the nine months ended September 30, 2010 and 2009 was $5.6 million. EpiCept expects selling, general and administrative expenses to decline modestly over the next few quarters.

Research and Development (R&D) Expense

R&D expense in the third quarter of 2010 decreased by approximately 36%, or $1.1 million, to $2.1 million compared with $3.2 million in the third quarter of 2009. R&D expense for the nine months ended September 30, 2010 decreased by approximately 28%, or $2.5 million, to $6.7 million compared with $9.2 million for the nine months ended September 30, 2009. The decrease in R&D expense was primarily related to lower salary and salary-related expenses and facility costs related to closing the research facility in San Diego in 2009, lower license fees and lower clinical trial expenses for Ceplene?, partially offset by higher regulatory fees for Ceplene?. A substantial portion of the Company's R&D expense in 2010 related to regulatory costs associated with the Company's NDA filing of Ceplene?.

Other Income (Expense)

Other income (expense) during the third quarter of 2010 amounted to net income of $0.8 million, compared with net income of $0.2 million in the third quarter of 2009. The primary component of other income (expense) in both quarters is foreign exchange gain. Other income (expense) for the nine months ended September 30, 2010 amounted to net expense of $0.5 million, compared with net expense of $19.8 million for the nine months ended September 30, 2009. Other expense, net for the nine months ended September 30, 2010 was impacted by a $0.4 million foreign exchange loss incurred as a result of the increased strength of the U.S. dollar compared with the euro. Interest expense of $19.9 million was recorded in the first nine months of 2009, which included $10.5 million in amortization of debt issuance costs and debt discount related to the conversion of $24.5 million of the Company's 7.5556% convertible subordinated notes due 2014 into approximately 9.1 million shares of its common stock.

Liquidity

As of September 30, 2010 EpiCept had approximately $3.6 million in cash and cash equivalents. On October 29, 2010, the Company was notified by the Internal Revenue Service that its application for the Qualifying Therapeutic Discovery Project Program was certified and a grant in the amount of $0.7 million was approved. Grant funds are expected to be received in November 2010. On November 8, 2010, the Company announced that it entered into definitive agreements for the purchase of approximately 3.3 million shares of its common stock at $0.61 per share, and five-year warrants to purchase up to approximately 1.3 million shares of common stock at an exercise price of $0.56 per share. EpiCept will receive approximately $1.9 million in net proceeds from the offering, which is expected to close on or about November 10, 2010. The Company believes that its cash at September 30, 2010 plus the proceeds from the public offering and the grant from the Internal Revenue Service is sufficient to fund operations into the first quarter of 2011.

On November 6, 2010 the Company provided an update with respect to its financing plans. The key element of the plan is a non-equity financing transaction that, if completed, will support the Company's operations through at least year-end 2011. The Company anticipates that the transaction, which is subject to completion of due diligence and execution of mutually-satisfactory documentation, will close before year-end, but should the transaction not close or the proceeds be less than anticipated the Company may determine to seek additional or alternative sources or types of financing, including equity financing. EpiCept may delay or cancel some of its planned activities until results of the financing plan become more apparent.

EpiCept plans to out-license its NP-1 compound to a third party who will agree to complete clinical development and commercialize the product upon receipt of necessary regulatory approvals. Discussions with prospective partners are progressing, however at this time it is not possible to determine whether or when such an agreement might be concluded or the amount of any fees that may be paid to EpiCept in connection with the agreement.

SOURCE EpiCept Corporation