$treet Trader Lion's Den

[$treet Trader]

PHGUF ( 1.75 ) Pharming Announces Annual Results 2007 Hugin "Hugin English "
Improved cash position and significant progress in development of Rhucin®
Leiden, The Netherlands , February 15, 2008 . Biotech company Pharming Group NV ("Pharming" or "the Company") (Euronext: PHARM) announced today its financial results (unaudited) for the year ending 31 December, 2007 . The Company has strengthened its cash position and has made significant progress in the development of Rhucin® (recombinant human C1 inhibitor or rhC1INH for treatment of acute attacks of Hereditary Angioedema or HAE).

Key Developments
Financial

* Cash position (including marketable securities) of ⬠65.3 million
at December 31, 2007 compared to ⬠31.3 million at December 31,
2006
* Issuance of convertible bonds raising ⬠70 million
* Equity of ⬠34.7 million compared to ⬠49.8 million at the end of
2006
* Total costs and expenses were ⬠25.3 million in 2007 compared to
⬠18.2 million in 2006
* Net cash used for operating activities of ⬠21.9 million in 2007
compared to ⬠19.6 million in 2006
* Total net loss of ⬠35.6 million in 2007 compared to ⬠18.5
million in 2006 including one-off costs related to the
termination of the 'Paul Capital Agreement'
* Revenues of ⬠0.7 million in 2007 compared to ⬠0.1 million in
2006.


Products

* Achievement of primary and secondary endpoints in European Phase
III placebo-controlled randomized clinical trial of Rhucin®
* Committee for Medicinal Products for Human Use (CHMP) issued a
negative opinion regarding the marketing authorisation for
Rhucin® for treatment of acute attacks of HAE in the European
Union
* Process on re-examination of negative CHMP opinion initiated
* European placebo-controlled randomized clinical trial stopped on
ethical grounds after positive results. Patient treatment with
Rhucin® continued in open-label clinical program
* Pharming facilities obtained GMP status (Good Manufacturing
Practice) from the European Medicines Agency (EMEA)
* Randomized treatments in North American placebo-controlled
clinical trial on Rhucin® completed
* Strategy for recombinant human fibrinogen (rhFIB) expanded as a
pharmaceutical product for genetic and acquired deficiencies and
Orphan Drug designation from the US Food and Drug Administration
(FDA)
* Generally Recognized as Safe (GRAS) notification for human
lactoferrin (hLF) still under review with the FDA
* Initiation of several early stage programs broadening the product
portfolio.


Corporate

* Strengthening of financial position by ⬠70 million convertible
loan and restructuring of the agreement with Paul Capital
Healthcare (formerly " Paul Royalty Fund ")
* Collaboration signed with Solvay and academic groups on
Parkinson's and Alzheimer's disease supported by Top Institute
Pharma.
"In 2007, the Company made good progress on the development of several products and developed new research initiatives," said Dr. Francis J. Pinto, CEO of Pharming. "Based on these developments, we were able to significantly strengthen our cash position despite difficult market conditions. Although the initial negative opinion of the CHMP causes a delay in getting Rhucin® to HAE-patients in Europe , it does not change our plans or strategy. We remain focused on bringing this product to the market as soon as possible based on strong scientific and medical data. The Company is well financed and we will continue to further build on our product portfolio and our technology platforms. Pharming is now close to getting its first products approved which should generate an enormous boost for the validation of our technology platform and should open the door for one or more licensing agreements."
Financial
Pharming's cash position including marketable securities and restricted cash was ⬠65.3 million at December 31, 2007 in comparison to ⬠31.3 million at the end of 2006. In 2007, the Company raised ⬠70 million through the issuance of convertible bonds to institutional investors, which was managed by UBS Investment Bank . Approximately ⬠19.3 million (of which ⬠10.2 million in Q1 2008) of these proceeds were used to restructure the existing agreement with Paul Royalty Fund while approximately ⬠3.0 million were used for transaction fees. As per the relevant IFRS rules, the convertible bonds have a liability component as well as an equity component. Applying these regulations yields an equity component of ⬠18.5 million and a liability component of ⬠51.5 million. These have been charged to the balance sheet accordingly. The equity position of the Company as of the end of 2007 was ⬠34.7 million compared to ⬠49.8 million at the end of 2006. Current liabilities were ⬠23.5 million compared to ⬠9.2 million at December 31, 2006 . These changes are largely associated with the convertible bonds issued to institutional investors and the restructuring of the financing agreement with Paul Royalty Fund .
The total costs and expenses in 2007 (including ⬠3.4 million non-cash costs) were ⬠25.3 million compared to ⬠18.2 million in 2006 (including ⬠2.2 million non-cash costs). The net loss in 2007 was ⬠35.6 million compared to a net loss of ⬠18.5 million in 2006. This difference is largely caused by one-time-events, in particular the settlement with Paul Royalty Fund , and costs directly associated with the regulatory filings of Rhucin®. In addition, the effect of share-based compensation was significantly higher than in 2006. Finally, costs were higher in line with increased costs in general, a modest increase in headcount and the first full year consolidation of DNage. In line with earlier guidance, the net cash used for operating activities in 2007 was slightly higher than in 2006 (⬠21.9 million in 2007 compared to ⬠19.6 million in 2006). Inventories further increased to ⬠11.7 million from ⬠9.2 million at December 31, 2006 , which is needed in preparation for the first commercial launch of Rhucin® later in 2008 as well as for use in the new clinical programs with Rhucin® in the field of organ transplantation.
Product development In the European placebo-controlled randomized clinical study on Rhucin® for treatment of acute attacks of HAE both the primary endpoint, time to beginning of symptom relief, and the secondary endpoint, time to minimal symptoms, were achieved with statistical significance. Based on these positive results the trial was discontinued for methodological and ethical reasons. In addition, Pharming received confirmation from the EMEA that its production facilities and processes conform with Good Manufacturing Practice and are thus licensed for manufacturing of pharmaceutical products. However, the Committee for Medicinal Products for Human Use decided to not grant a European marketing authorisation for Rhucin®. With this initial refusal, the registration process in the European Union has been delayed. However, Pharming remains confident that the available scientific and clinical data form the basis for a positive risk benefit ratio for Rhucin®. Therefore, the Company has requested re-examination of the negative opinion and has submitted detailed grounds for its re-examination request in February 2008 . A final decision on the Market Authorization of Rhucin® within the EU is expected in the first half of 2008.
The North American double-blind randomized placebo-controlled clinical trial was completed in the fourth quarter of 2007 and the data are currently being analyzed. The US open-label study is still ongoing.
Meanwhile, Pharming has made good progress on the development of several other products. The Company expects to start several new clinical programs in 2008, including clinical studies with rhC1INH in the field of organ transplantation, a clinical program with Prodarsan® for treatment of premature ageing diseases and a development program for recombinant human fibrinogen as a replacement therapy for genetic and acquired deficiencies of fibrinogen.
In interactions with the FDA throughout 2007, no questions appeared to be outstanding with regard to the use of human lactoferrin in nutritional products. The GRAS-notification has been reviewed by an independent scientific expert panel who agreed that hLF is safe for its intended uses. Although Pharming had expected to receive a decision from the FDA in 2007, it is still hopeful that the agency will accept Pharming's notification in the near future.
Corporate
During 2007, Pharming initiated and continued several research programs, exemplifying the Company's strategy to expand its research engine and to strengthen its product pipeline. In the second half of 2007, the Company announced its participation in a Biomedical Materials Program, a public-private partnership in the Netherlands that focuses on research and development in the field of biomedical materials. Throughout the year Pharming received commitments for several grants to support its activities in research related to so-called ageing diseases. With support from Top Institute Pharma, Pharming's wholly owned subsidiary DNage BV also started a collaboration with Solvay and academic groups on Parkinson's and Alzheimer's diseases.
Through the issuance of convertible bonds to institutional investors, the Company solidified its cash position by raising ⬠70 million. The proceeds of the convertible offering have partly been used to restructure the agreement with Paul Capital Healthcare. The remainder will be used for general corporate purposes including investments in research and development and in clinical programs.
Outlook 2008
* Based on the standard schedule, Pharming anticipates a final
decision on the Market Authorization of Rhucin® for treatment of
acute HAE-attacks within the EU in the first half of 2008
* Pharming expects to announce the results of its US randomized
placebo controlled clinical study with Rhucin® and file a
Biologic License Application for US market approval in 2008
* Pharming expects to start clinical studies with rhC1INH in the
field of organ transplantation in 2008
* Pharming expects to start clinical studies with Prodarsan® for
treatment of premature ageing disease in 2008
* Pharming expects a decision from the FDA on its GRAS notification
for hLF in 2008
* The Company will continue its discussions with potential
licensing partners with the goal to conclude one or more
licensing agreements in 2008
* Since the exact timing of decisions made by regulatory bodies
and, therefore, the timing of concluding licensing- or other
commercial agreements cannot be predicted, Pharming does not
provide guidance for the expected financial result in 2008.
Conference Call Information Today, Chief Commercial Officer Rein Strijker will present the 2007 results and the outlook for 2008 in a conference call for analysts (in English) and press (in Dutch) at 9:00 am and 10:30 am CET respectively. An audiocast of the conference calls will be available on Pharming's website after the calls.
About Pharming Group NV Pharming Group NV is developing innovative products for the treatment of genetic disorders, ageing diseases, specialty products for surgical indications, intermediates for various applications and nutritional products. Pharming has two products in late stage development - Rhucin® (recombinant human C1 inhibitor) for Hereditary Angioedema and human lactoferrin for use in food products. The advanced technologies of the Company include innovative platforms for the production of protein therapeutics, technology and processes for the purification and formulation of these products, as well as technologies in the field of tissue repair (via its collaboration with Novathera) and DNA repair (via DNage). Additional information is available on the Pharming website, http://www.pharming.com and on http://www.dnage.nl.
This press release contains forward looking statements that involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the Company to be materially different from the results, performance or achievements expressed or implied by these forward looking statements. The press release also appears in Dutch. In the event of any inconsistency, the English version will prevail over the Dutch version.


Contact:

Carina Hamaker, Investor Voice T: [phone] or T: +31 (0)71
52 47 400
Julia Philips (UK), Financial Dynamics, T: [phone] or T:
[phone]
Samir Singh (US), Pharming Healthcare Inc , T: [phone]
Rein Strijker, Pharming Group NV , T: [phone]



The full report including tables can be downloaded from the following link:
http://hugin.info/132866/R/1192175/240675.pdf