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Aradigm Announces Second Quarter 2010 Financial Results
HAYWARD, Calif., Aug 12, 2010 (BUSINESS WIRE) -- Aradigm Corporation (OTCBB:ARDM) (the "Company") today announced financial results for the second quarter and six months ended June 30, 2010.
The Company's net loss for the second quarter of 2010 was approximately $4.1 million, or $0.04 per share, compared with a net loss of approximately $4.6 million, or $0.05 per share, for the second quarter of 2009. Total operating expenses for the second quarter of 2010 were approximately $4.1 million, compared with total operating expenses of approximately $4.5 million for the second quarter of 2009. The decrease in operating expenses was primarily due to expense reduction efforts and the elimination of R&D expenses associated with the collaboration with Lung Rx, Inc.
No revenue was recorded in either the second quarter of 2010 or the second quarter of 2009. The Company anticipates recording recurring royalty revenue based on sales of the SUMAVEL* DosePro* product beginning with the three months ending September 30, 2010 since the terms of the asset sale agreement with Zogenix provides for royalty payments to be based on cash received by Zogenix on their product sales and there is a sixty day lag following the end of the quarter in royalty reporting. The Company has been informed by Zogenix that wholesalers distributing the SUMAVEL DosePro product were given net 90 day payments terms for the first quarter sales, resulting in the effective delay of first quarter 2010 royalties until the second quarter 2010 royalty payment due in late August 2010. After the first quarter of 2010, the payment terms for wholesalers reverted to net 30 days.
As of June 30, 2010, cash and cash equivalents totaled approximately $9.6 million.
The Company announced that:
"In the last two months, we entered into two financial transactions that were very important to the Company. The equity for debt transaction with Novo Nordisk will allow us to significantly strengthen our balance sheet by eliminating all outstanding debt once we receive shareholder approval for the additional shares needed for this transaction, while the proceeds from the June 2010 private placement are being used to enable us to take further steps in the development of our lead product candidate, inhaled liposomal ciprofloxacin. We continue our focus on aggressive cost containment even as we conduct our two ongoing clinical trials, ORBIT-1 and ORBIT-2," said Nancy E. Pecota, the Company's Vice President, Finance and Chief Financial Officer.
About liposomal ciprofloxacin
Ciprofloxacin is a widely prescribed antibiotic to treat infections of the lung frequently experienced by cystic fibrosis (CF) and non-cystic fibrosis bronchiectasis (BE) patients. It is often preferred because of its broad-spectrum anti-bacterial action. The available oral and intravenous formulations of the drug are used to treat episodes of acute exacerbations of lung infections in CF patients. The Company's once-a-day novel inhaled formulations of ciprofloxacin delivered in liposomes is to be used for chronic maintenance therapy as it is expected to achieve higher antibiotic concentration at the site of infection and relatively low systemic antibiotic concentrations to minimize side-effects. The Company previously announced initiation of two multinational Phase 2b clinical trials in patients with BE, one using ARD-3100 (ORBIT-1) and another trial (ORBIT-2) using a formulation with a modified pharmacokinetic profile (ARD-3150). The results of these two trials are expected in the second half of 2010. The Company is also developing inhaled liposomal ciprofloxacin for the prevention and treatment of bioterrorism infections, such as inhaled anthrax and tularemia.
Aradigm is an emerging specialty pharmaceutical company focused on the development and commercialization of a portfolio of drugs delivered by inhalation for the treatment of severe respiratory diseases by pulmonologists. The Company has product candidates addressing the treatment of cystic fibrosis, bronchiectasis, inhaled bioterrorism infections and smoking cessation.
More information about Aradigm can be found at www.aradigm.com.
Except for the historical information contained herein, this news release contains forward-looking statements, including, but not limited to, statements regarding the closing of the private placement and the elimination of debt. These forward-looking statements involve risk and uncertainties, including (i) the risk that the warrants issued in the June 2010 private placement might not become exercisable, (ii) the risk that the closing of the transactions contemplated by the Stock Purchase Agreement with Novo Nordisk might not be satisfied and (iii) the risk of any difficulties or delays in obtaining the required shareholder approval to increase the number of authorized shares of common stock, as well as the other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission (SEC), including the Company's Annual Report on Form 10-K for the year ended December 31, 2009 filed with the SEC on March 24, 2010, and the Company's Quarterly Reports on Form 10-Q.
Aradigm and the Aradigm Logo are registered trademarks of Aradigm Corporation.
* Other names and brands may be claimed as the property of others.
CONDENSED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Three months ended
Six months ended
|Research and development||2,736||2,927||5,573||6,653|
|General and administrative||1,382||1,368||2,635||2,766|
|Restructuring and asset impairment||13||205||26||223|
|Total operating expenses||4,131||4,500||8,234||9,642|
|Loss from operations||(4,131||)||(4,500||)||(4,234||)||(9,642||)|
|Other income (expense), net||108||(3||)||106||(4||)|
|Basic and diluted net loss per common share||$||(0.04||)||$||(0.05||)||$||(0.04||)||$||(0.12||)|
|Shares used in computing basic and diluted net loss per common share||104,891||99,298||102,396||85,080|
CONDENSED BALANCE SHEETS
|Cash and cash equivalents||$||9,608||$||3,903|
|Prepaid and other current assets||499||328|
|Total current assets||10,501||9,614|
|Property and equipment, net||1,849||2,166|
|LIABILITIES AND SHAREHOLDERS' DEFICIT|
|Accrued clinical and cost of other studies||664||670|
|Facility lease exit obligation||182||263|
|Other accrued liabilities||284||357|
|Total current liabilities||2,730||2,203|
|Facility lease exit obligation, non-current||785||828|
|Other non-current liabilities||75||75|
|Note payable and accrued interest||9,113||8,896|
|Total liabilities and shareholders' deficit||$||12,532||$||11,965|
* The balance sheet at December 31, 2009 has been derived from the audited financial statements at that date.
SOURCE: Aradigm Corporation
Nancy Pecota, 510-265-9370 (Chief Financial Officer)
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