UPDATE 1-Dynavax posts Q2 loss, shares fall

Fri Jul 30, 2010 5:46pm EDT

* Q2 loss/shr $0.34 vs EPS $0.10 yr-ago

* Q2 rev falls 86 pct

* Shares down 6 pct afterhours

July 30 (Reuters) - Dynavax Technologies Corp (DVAX.O) posted a quarterly loss, hurt partly by higher expenses as the drugmaker restarted development of its experimental hepatitis B drug heplisav.

The drug, which is now in late-stage development, was put on clinical hold by the U.S. Food and Drug Administration in March 2008. Later that year, Merck (MRK.N) ended a collaboration agreement over the development and commercialization of heplisav.

Net loss for the second quarter was $28.0 million, or 34 cents a share, compared with net income of $4.1 million, or 10 cents a share, in the year ago period.

Revenue for the quarter of $2.2 million was down 86 percent from last year when the company recorded deferred revenue due to the termination of the Merck collaboration.

Total operating expenses for the second quarter were $18.5 million, while expenses were $13 million last year, prior to restarting the heplisav clinical program last September.

In March, the company's auditors expressed doubts on its ability to continue as a going concern. [ID:nSGE62F0EP]

Shares of the company fell 6 percent in afterhours trade to $2.07. They closed at $2.21 Friday on Nasdaq. (Reporting by Krishnakali Sengupta in Bangalore; Editing by Aradhana Aravindan)