Transition Therapeutics Announces Second Quarter Fiscal 2013 Financial Results
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For best results when printing this announcement, please click on the link below: http://pdf.reuters.com/pdfnews/pdfnews.asp?i=43059c3bf0e37541&u=urn:newsml:reuters.com:20130207:nPnTO664 TORONTO, Feb. 7, 2013 /PRNewswire/ - Transition Therapeutics Inc. ("Transition" or the "Company") (TSX: TTH; NASDAQ: TTHI), a product-focused biopharmaceutical company developing therapeutics for disease indications with large markets, today announced its financial results for the three and six month periods ended December 31, 2012. Selected Highlights During fiscal 2013 and up to the date of this press release, the Company announced the following: * On November 28, 2012, Transition announced that their licensing partner Elan had enrolled the first patient in a Phase II study of ELND005 for the treatment of agitation/aggression in patients with moderate to severe Alzheimer's disease; * On August 30, 2012, Transition announced that their licensing partner Elan had dosed the first patient in a Phase II clinical study of ELND005 in Bipolar Disorder. The study is a placebo-controlled, safety and efficacy study of oral ELND005 as an adjunctive maintenance treatment in patients with Bipolar 1 Disorder to delay the time to occurrence of mood episodes. As the first patient has been dosed in the study, Transition received a milestone payment of US$11 million from Elan. Financial Liquidity The Company's cash and cash equivalents and short term investments were $24,958,522 at December 31, 2012. The Company's current cash projection indicates that the current cash resources should enable the Company to execute its core business plan and meet its projected cash requirements well beyond the next 12 months. Financial Review For the three month period ended December 31, 2012, the Company recorded a net loss of $2,754,534 ($0.10 loss per common share) compared to net loss of $3,790,421 ($0.15 loss per common share) for the three month period ended December 31, 2011. For the six month period ended December 31, 2012, the Company recorded a net income of $4,981,512 ($0.19 income per common share) compared to a net loss of $6,661,178 ($0.28 loss per common share) for the six-month period ended December 31, 2011. Revenue is nil and $10,815,200 in the three and six month periods ended December 31, 2012 respectively, compared to nil in both three and six month period ended December 31, 2011. In August 2012, Elan dosed the first patient in a Phase 2 clinical study of ELND005 in Bipolar Disorder. In light of the amendments to the Elan agreement, the Company has recognized $10,815,200(US$11,000,000) as revenue during the first quarter of fiscal 2013 which represents the milestone payment received from Elan upon their commencement of the next ELND005 clinical trial. The payment from Elan was received on October 1, 2012. Research and development expenses increased $80,635 or 4% from $2,060,622 for the three month period ended December 31, 2011 to $2,141,257 for the three month period ended December 31, 2012. The increase is largely due to an increase in clinical development costs related to TT-401/402, which has been offset by decreases in clinical development costs related to TT-301/302 and salaries and related costs associated with headcount reductions. For the six month period ended December 31, 2012, research and development expenses decreased $118,543 or 3% to $4,195,803 from $4,314,346 for the same period in fiscal 2012. The decrease is primarily due to decreases in clinical development costs related to TT-301/302 and salaries and related costs associated with headcount reductions. The decrease is largely offset by increased clinical development costs related to TT-401/402. General and administrative expenses decreased by $683,472 or 45% from $1,532,912 for the three month period ended December 31, 2011 to $849,440 for the three month period ended December 31, 2012. For the six month period ended December 31, 2012, general and administrative expenses decreased $956,616 or 36% to $1,666,342 from $2,622,958 for the same period in fiscal 2012. The decreases in general and administrative expenses for both the three and six month periods ended December 31, 2012 are due to decreases in legal consulting fees, facility lease costs, and investor relation and business development expenses, as well as decreased salaries and related costs resulting from headcount reductions as the comparative periods included severances relating to terminations. About Transition Transition is a biopharmaceutical company, developing novel therapeutics for disease indications with large markets. Transition's lead product is ELND005 for the treatment of Alzheimer's disease and bipolar disorder. Transition also has an emerging pipeline of innovative preclinical and clinical drug candidates. The other drugs in the pipeline that the Company is developing are for anti-inflammatory and metabolic indications. Transition's shares are listed on the NASDAQ under the symbol "TTHI" and the Toronto Stock Exchange under the symbol "TTH". For additional information about the Company, please visit www.transitiontherapeutics.com. Extracts of the Financial Statements to Follow: CONSOLIDATED BALANCE SHEETS (Unaudited) As at In Canadian Dollars December 31, 2012 June 30, 2012 Assets Current assets Cash and cash equivalents 18,955,854 12,955,081 Short term investments 6,002,668 6,057,264 Trade and other receivables 48,408 43,658 Investment tax credits receivable 370,289 241,951 Prepaid expenses and deposits 458,037 316,286 25,835,256 19,614,240 Non-current assets Property and equipment 194,181 215,000 Intangible assets 16,374,143 17,263,790 Total assets 42,403,580 37,093,030 Liabilities Current liabilities Trade and other payables 896,145 1,178,915 Current portion of contingent consideration payable 2,321,373 2,321,373 3,217,518 3,500,288 Non-current liabilities Contingent consideration payable 1,434,958 1,434,958 Leasehold inducement 28,579 34,295 4,681,055 4,969,541 Equity attributable to owners of the Company Share capital 165,334,259 165,334,259 Contributed surplus 13,431,445 13,168,411 Share-based payment reserve 3,331,522 2,977,032 Deficit (144,374,701) (149,356,213) 37,722,525 32,123,489 Total liabilities and equity 42,403,580 37,093,030 CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS) For the six and three month periods ended December 31, 2012 and 2011 (Unaudited) In Canadian Dollars Six month Six month Three month Three month period ended period ended period ended period ended December 31, December 31, December 31, December 31, 2012 2011 2012 2011 Revenues Licensing fees 10,815,200 - - - Expenses Research and development 4,195,803 4,314,346 2,141,257 2,060,622 Selling, general and administrative expenses 1,666,342 2,622,958 849,440 1,532,912 Loss on disposal of property and equipment - 118,623 - 38,709 Operating income (loss) 4,953,055 (7,055,927) (2,990,697) (3,632,243) Interest income 68,489 80,339 34,872 40,412 Interest expense - (851) - (241) Foreign exchange gain (loss) (40,032) 315,261 201,291 (198,349) Net income (loss) and 4,981,512 (6,661,178) (2,754,534) (3,790,421) comprehensive income (loss) for the period Basic and diluted net income (loss) 0.19 (0.28) (0.10) (0.15) per common share Notice to Readers: Information contained in our press releases should be considered accurate only as of the date of the release and may be superseded by more recent information we have disclosed in later press releases, filings with the OSC, SEC or otherwise. Except for historical information, this press release may contain forward-looking statements, relating to expectations, plans or prospects for Transition, including conducting clinical trials. These statements are based upon the current expectations and beliefs of Transition's management and are subject to certain risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties include factors beyond Transition's control and the risk factors and other cautionary statements discussed in Transition's quarterly and annual filings with the Canadian commissions. SOURCE Transition Therapeutics Inc. For further information on Transition, visit www.transitiontherapeutics.com , or contact: Dr. Tony Cruz Chairman & Chief Executive Officer Transition Therapeutics Inc. Phone: (416) 260-7770, x.223 email@example.com Nicole Rusaw-George Chief Financial Officer Transition Therapeutics Inc. Phone: (416) 260-7770, x.202 firstname.lastname@example.org