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[DewDiligence]

VRUS Reports FY1Q08 Results

[For archival purposes—no new info.]

http://biz.yahoo.com/prnews/080214/clth015a.html

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Thursday February 14, 4:15 pm ET

PRINCETON, N.J., Feb. 14 /PRNewswire-FirstCall/ -- Pharmasset, Inc. (Nasdaq: VRUS ), a clinical stage pharmaceutical company committed to discovering, developing and commercializing novel drugs to treat viral infections, reported unaudited financial results for the first fiscal quarter of 2008 ended December 31, 2007. Pharmasset reported a net loss attributable to common stockholders of $12.2 million, or ($0.57) per share for the first fiscal quarter of 2008, as compared to net income attributable to common stockholders of $3.6 million, or $0.33 per diluted share for the same period in fiscal 2007.

Revenues were $0.5 million during the first fiscal quarter of 2008, which consisted of the amortization of payments received from Roche from the hepatitis C virus (HCV) collaboration agreement that were previously recorded as deferred revenue. Revenues for the same period in fiscal 2007 were $8.1 million, which included a $7.5 million milestone payment received from Roche. Investment income was $0.9 million during the first fiscal quarter of 2008 compared to $0.4 million during the same period in 2007. The $0.5 million increase in the first fiscal quarter of 2008 was due to higher average invested cash balances.

Total costs and expenses for the first fiscal quarter of 2008 were $13.2 million as compared to $4.6 million for the same period in fiscal 2007. The $8.6 million increase in operating expenses for the first fiscal quarter of 2008 was primarily due to a $7.0 million increase in Phase 3 registration clinical trial expenses for clevudine for the treatment of chronic hepatitis B virus (HBV) infection, as well as approximately $1.6 million in drug discovery, compensation, insurance, audit and non-cash stock compensation expenses. Interest expense was $0.4 million during the first fiscal quarter of 2008 compared to $1,800 during the same period in fiscal 2007. The increase was primarily due to interest paid on the $10.0 million of long-term debt we incurred during October 2007.

At December 31, 2007, Pharmasset held $61.5 million in cash and cash equivalents and approximately $1.3 million of short-term investments. [LOL—the ST investments are probably auction-rate securities.]

"We collected preliminary results of the R7128 combination study for the treatment of HCV in the first fiscal quarter of 2008, and we look forward to orally presenting the final results of these two cohorts at the 43rd Annual Meeting of the European Association for the Study of the Liver (EASL) in April 2008," stated Schaefer Price, Pharmasset's Chief Executive Officer. "The rapid advancement of the R7128 program is a tribute to the productivity of our HCV collaboration with Roche and our communications with the FDA. We are currently focused on planning a 12-week Phase 2b combination study of R7128 with Pegasys plus Copegus, continuing clevudine HBV patient enrollment and nominating a lead preclinical candidate from our proprietary HCV discovery efforts."

First Fiscal Quarter 2008 Highlights

-- Commenced and subsequently completed dosing two cohorts in 4-week combination study of R7128 with Pegasys® plus Copegus® for the treatment of HCV.

-- Received fast track designation from the FDA for R7128 for the treatment of HCV.

-- Entered antiviral research collaboration with the University of Cincinnati's Genome Research Institute.

-- Appointed Michael Rogers as Chief Development Officer and Patrick T. Higgins as Executive Vice President, Marketing & Sales.

-- Presented R7128 Phase 1 single ascending dose and 14-day monotherapy study results for the treatment of HCV.

-- Discovered a new series of proprietary nucleoside analogs that have demonstrated potent anti-HCV activity.

Anticipated Highlights

-- Oral presentation of the final safety and efficacy data from two cohorts from the third part of a Phase 1 study of R7128 following 4 weeks of combination therapy with Pegasys plus Copegus at the 43rd Annual Meeting of the European Association for the Study of the Liver (EASL) being held from April 23-27, 2008 in Milan, Italy.

-- Complete HBV patient enrollment for clevudine Phase 3 registration clinical trials in the second calendar half of 2008.

-- Initiate HCV patient screening for a 12-week Phase 2b combination study of R7128 with Pegasys plus Copegus in the fourth calendar quarter of 2008, assuming the successful completion of the on-going R7128 Phase 1 study, transfer of our IND for R7128 to Roche, consent from the FDA and timely completion of all required Phase 2b study preparation activities.

-- Conducting preclinical studies of a proprietary anti-HCV nucleoside analog to support first-in-human clinical trials, once a lead compound has been nominated from the series.

About Pharmasset

Pharmasset is a clinical-stage pharmaceutical company committed to discovering, developing and commercializing novel drugs to treat viral infections. Pharmasset's primary focus is on the development of oral therapeutics for the treatment of hepatitis B virus (HBV), hepatitis C virus (HCV) and human immunodeficiency virus (HIV).

Pharmasset is currently developing three product candidates. Clevudine, for the treatment of chronic HBV infection, is enrolling Phase 3 clinical trials for registration in North, Central and South America and Europe. Clevudine is already approved for HBV in South Korea and marketed by Bukwang Pharmaceuticals in South Korea under the brand name Levovir. R7128, an oral treatment for chronic HCV infection, is in a 4-week Phase 1 clinical trial in combination with Pegasys plus Copegus through a strategic collaboration with Roche. Racivir, which is being developed for the treatment of HIV in combination with other approved HIV drugs, has completed a Phase 2 clinical trial.
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