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| 8-K - FORM 8-K 03.24.2010 - PRESS RELEASE - SCOLR Pharma, Inc. | form_8-k.htm |
SCOLR
Pharma, Inc. Reports 2009 Full-Year Financial Results
BOTHELL,
WA, March 24, 2010, - SCOLR Pharma, Inc. (NYSE AMEX: DDD) today reported
financial results for the twelve months ended December 31, 2009. The
Company will host a live conference call on March 31, 2010, at 11:30 a.m.
(Eastern Standard Time).
Stephen
J. Turner, SCOLR Pharma’s President and CEO, said, “2009 was a pivotal and
transformational year for the company; we developed several
differentiated extended release nutritional products in support of our
direct sales efforts, moved pseudoephedrine forward towards an expected
2010 FDA approval and eventual commercialization, and we dramatically
lowered our cost structure, providing us with a much lower break-even threshold
than in the past. The results of our business efforts and cost cuts in the later
part of 2009 have repositioned the company.
“One of
our major priorities is to maximize the competitive advantage our technology
provides to a broad range of nutritional products. We now have an extensive and
differentiated nutritional product portfolio that is expected to result in
increasing sales throughout 2010 as we continue to grow our distribution in key
retailers and multiple channels of trade.
“We
believe our 12 hour Ibuprofen formulation, based on the positive safety and
efficacy results from our Phase III trial, may provide significant benefits to
the consumer. With the recent acquisition of the Nuprin® brand name,
we are in an enhanced position to move our product forward in this very large
and growing global market, either with a partner, or alone.
“We have
improved our financial strength with the recent completion of a financing that
provided the Company with net proceeds of approximately $3.6 million. These
additional resources will enable us to further expand our commercialization and
development efforts.”
Highlights
include the following:
|
·
|
We
formulated and transferred more than 10 differentiated extended release
nutritional supplement products in preparation for our new product launch
and direct sales efforts in 2010.
|
|
·
|
We
retained a commission based sales/marketing broker to aid in the
introduction of our extended release nutritional
supplements. Numerous meetings have taken place with a number of
large national retailers.
|
|
·
|
We
renegotiated our lease and rent expense with our landlord providing near
term relief and a reduction in our total square footage and lease
obligation. In addition, we have entered into a sublease arrangement
further reducing our cost
structure.
|
|
·
|
We
continued to manage our Abbreviated New Drug Application, or ANDA filing
and all minor deficiencies have been addressed in amendments which are
currently under review. We anticipate U.S. Food and Drug Administration,
or FDA approval later this year.
|
|
·
|
We
completed our pivotal Phase III trial demonstrating safety and efficacy of
our 12 hour 600mg controlled release ibuprofen for the OTC market. We are
currently working with the FDA, as we seek to complete the remaining
activities required in our New Drug Application, or NDA, on the product
formulation. The FDA will require completion of an actual use study
(AUS) meant to simulate how consumers use the product in an OTC
environment prior to submission of our NDA. The information gathered
will be utilized to assess safety and
compliance.
|
|
·
|
We
recently completed a private placement of units consisting
of one share of common stock and a warrant to purchase one-fifth of
one share of common stock at a purchase price of $0.50 per unit. We
sold an aggregate of 8,260,000 shares of our common stock
and warrants to purchase 2,230,200 shares of our common stock in the
offering. The warrants have an exercise price of $0.75 per share.
Net proceeds of the offering were approximately $3.6 million after
placement agent fees, expenses of registration, and other direct and
incremental offering costs.
|
|
·
|
We
recently acquired rights to the Nuprin® name in connection with sales of
ibuprofen. SCOLR purchased all right, title and interest of Advanced
Healthcare Distributors, LLC to the Nuprin® name, including its portfolio
of global registrations (exclusive of Canada). Advanced Healthcare
Distributors, LLC is an affiliate of CVS Caremark
Corporation.
|
Rick
Levy, Vice President and Chief Financial Officer, said, “We are committed to
actively manage our cost structure as we execute our strategic plan to ensure
that our costs are commensurate with our business plan. We will continue to
monitor and evaluate our cost structure relative to our development programs and
plans for growth as we move forward.”
Total
revenues for the year ended December 31, 2009 were $935,000, a decrease of
2% compared to $958,000 for 2008.
1
SCOLR has
continued to make significant improvements to its operating efficiencies as
compared to a year ago. For the year ended December 31, 2009, the Company's
marketing and selling expenses decreased 71%, or $479,000, to $194,000, compared
to $673,000 in 2008. General and administrative expenses increased 15%, or
$659,000, to $5.0 million for the year ended December 31, 2009, compared to
$4.4 million in 2008. General and administrative expenses were negatively
impacted by an increase of personnel related expenses of approximately $1.5
million due to the recognition of approximately $669,000 of severance costs
associated with the departure of the Company’s former Chief Executive Officer
and former Senior Vice President of Business and Legal Affairs, and an
approximately $797,000 increase in non-cash, share-based compensation expense
for executive employee’s stock options in 2009.
Research
and development expenses decreased 61%, or $3.8 million, to $2.4 million for the
year ended December 31, 2009, compared to $6.3 million in
2008.
Net loss
increased 9%, or $557,000, to $6.7 million for the year ended December 31,
2009, compared to $6.1 million in 2008. With respect to operating expenses, the
year–over-year increase in costs resulting from the $4.0 million net cash
payment we received in 2008 on our lease termination, which was recognized as a
reduction in operating expense, was substantially offset in 2009 by reduced
research and development and marketing expenses.
SCOLR
Pharma had approximately $1.2 million in cash and cash equivalents, and $437,711
in restricted cash as of December 31, 2009. Including the additional cash
received from our financing in March 2010, we anticipate that our existing cash
and cash equivalents, together with expected royalties from third parties, will
be sufficient to fund our operations into the second half of 2011, unless
unforeseen events arise that negatively impact our liquidity.
Michael
Taglich, Chairman of the Board, said “On behalf of the Board, I want to thank
Steve, Rick and the employees for their hard work in repositioning the
company.”
Conference
Call
As
previously announced, SCOLR Pharma will host a conference call Thursday, March
25, 2010 at 8:30 AM Pacific for a duration of 1 hour (11:30 AM Eastern, 10:30 AM
Central, 9:30 AM Mountain). Shareholders and other interested parties may
participate in the conference call by dialing (888) 500-6974 (toll free) or
(719) 325-2106 and entering access code: 3824418. Please dial in 5 – 10 minutes
prior to the scheduled call.
A replay
of the conference call will be accessible for 30 days following completion of
the call. To access the recording, please dial (888) 203-1112 or (719) 457-0820
and use passcode: 3824418 and follow the instructions.
About
SCOLR Pharma:
Based in
Bothell, Washington, SCOLR Pharma, Inc. is a specialty pharmaceutical company
focused on applying its formulation expertise and patented CDT platforms to
develop novel prescription pharmaceutical, over-the-counter (OTC), and
nutritional products. Our CDT drug delivery platforms are based on multiple
issued and pending patents and other intellectual property for the programmed
release or enhanced performance of active pharmaceutical ingredients and
nutritional products. For more information on SCOLR Pharma, please call
425-368-1050 or visit http://www.scolr.com/.
This
press release contains forward-looking statements (statements which are not
historical facts) within the meaning of the Private Securities Litigation Reform
Act of 1995, including statements concerning the Company’s ability to fund its
operations until late 2011, the timing and success of FDA approvals, the success
of its products in the marketplace and in clinical trials and potential
partnership opportunities for its product candidates. These forward-looking
statements involve risks and uncertainties, including activities, events or
developments that we expect, believe or anticipate will or may occur in the
future. A number of factors could cause actual results to differ from those
indicated in the forward-looking statements, including unanticipated costs and
expenses associated with our product development, clinical activities and
regulatory review, reductions in our royalty revenues, our ability to
successfully develop new formulations and complete research and development, our
ability to raise additional funds, the continuation of arrangements with our
product development partners and customers, competition, government regulation
and approvals, and general economic conditions. For example, if we are not
successful in raising additional capital or securing partnership arrangements,
we may not be able to advance development and commercialize our products.
Additional assumptions, risks and uncertainties are described in detail in our
registration statements, reports and other filings with the Securities and
Exchange Commission. Such filings are available on our website or at
www.sec.gov. You are cautioned that such statements are not guarantees of future
performance and that actual results or developments may differ materially from
those set forth in the forward-looking statements. We undertake no obligation to
publicly update or revise forward-looking statements to reflect subsequent
events or circumstance.
2
SCOLR
Pharma, Inc.
BALANCE
SHEETS
(In
thousands)
|
December 31,
|
||||||||
|
2009
|
2008
|
|||||||
|
ASSETS
|
||||||||
|
Current
Assets
|
||||||||
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Cash
and cash equivalents
|
$
|
1,176
|
$
|
6,363
|
||||
|
Accounts
receivable
|
269
|
177
|
||||||
|
Prepaid
expenses and other assets
|
228
|
288
|
||||||
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Total
current assets
|
1,673
|
6,828
|
||||||
|
Property
and equipment—net
|
435
|
791
|
||||||
|
Intangible
assets—net
|
565
|
557
|
||||||
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Restricted
cash
|
438
|
474
|
||||||
|
Total
assets
|
$
|
3,111
|
$
|
8,650
|
||||
|
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
||||||||
|
Current
Liabilities
|
||||||||
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Accounts
payable
|
$
|
47
|
$
|
239
|
||||
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Accrued
liabilities
|
640
|
668
|
||||||
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Current
portion of term loan
|
—
|
88
|
||||||
|
Deferred
revenue
|
25
|
—
|
||||||
|
Total
current liabilities
|
712
|
995
|
||||||
|
Long-term
portion of term loan
|
—
|
23
|
||||||
|
Deferred
rent
|
198
|
310
|
||||||
|
Total
liabilities
|
910
|
1,328
|
||||||
|
Commitments
and Contingencies
|
—
|
—
|
||||||
|
Stockholders’
Equity
|
||||||||
|
Preferred
stock, authorized 5,000,000 shares, $0.01 par value, none issued or
outstanding
|
—
|
—
|
||||||
|
Common
stock, authorized 100,000,000 shares, $0.001 par value, 41,098,270 and
41,130,270 issued and outstanding as of December 31, 2009 and 2008,
respectively
|
41
|
41
|
||||||
|
Additional
contributed capital
|
72,832
|
71,256
|
||||||
|
Accumulated
deficit
|
(70,672
|
)
|
(63,975
|
)
|
||||
|
Total
stockholders’ equity
|
2,201
|
7,322
|
||||||
|
Total
liabilities and stockholders’ equity
|
$
|
3,111
|
$
|
8,650
|
||||
3
SCOLR
Pharma, Inc.
STATEMENTS
OF OPERATIONS
(In
thousands, except per share data)
|
Year
Ended December 31,
|
||||||||
|
2009
|
2008
|
|||||||
|
Revenues
|
||||||||
|
Royalty
|
$
|
935
|
$
|
958
|
||||
|
Total
revenues
|
935
|
958
|
||||||
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Operating
expenses
|
||||||||
|
Marketing
and selling
|
194
|
673
|
||||||
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Research
and development
|
2,433
|
6,268
|
||||||
|
General
and administrative
|
5,015
|
4,356
|
||||||
|
Facility
lease termination
|
||||||||
|
Gain
from lease buyout
|
—
|
(4,100
|
)
|
|||||
|
Expenses
related to relocation and lease buyout
|
—
|
117
|
||||||
|
Total
facility lease buyout
|
—
|
(3,983
|
)
|
|||||
|
Total
operating expenses
|
7,642
|
7,314
|
||||||
|
Loss
from operations
|
(
6,707
|
)
|
(
6,356
|
)
|
||||
|
Other
income (expense)
|
||||||||
|
Interest
expense
|
(3
|
)
|
(14
|
)
|
||||
|
Interest
income
|
13
|
230
|
||||||
|
Total
other income (expense)
|
10
|
216
|
||||||
|
Net
loss
|
$
|
(6,697
|
)
|
$
|
(6,140
|
)
|
||
|
Net
loss per share, basic and diluted
|
$
|
(0.16
|
)
|
$
|
(0.15
|
)
|
||
|
Shares
used in calculation of basic and diluted net loss per
share
|
41,100
|
41,116
|
||||||
Contacts:
Investor
Relations:
SCOLR
Pharma,
Inc.
425.368.1050
4