Unigene Labs reports financial results for three months ended June 30, 2009

Aug 11 2009

Unigene Laboratories, Inc. (OTCBB: UGNE) has reported its financial results for the quarter ended June 30, 2009.

Revenue for the three months ended June 30, 2009 was $4,297,000, compared to $4,978,000 for the three months ended June 30, 2008. Revenue for both periods primarily consisted of Fortical sales and royalties, which were $3,807,000 for the three months ended June 30, 2009, and $4,110,000 for the three months ended June 30, 2008. Fortical royalties were $1,077,000 for the three months ended June 30, 2009, compared to $1,475,000 for the three months ended June 30, 2008. Fortical sales were $2,730,000 for the three months ended June 30, 2009, compared to $2,635,000 for the three months ended June 30, 2008. Fortical sales fluctuate each quarter based upon USL’s ordering schedule. Fortical royalties fluctuate each quarter based upon the timing, pricing and volume of USL’s shipments to its customers, and Fortical net sales have declined since the launch of competitive products in December 2008.

Revenue for the six months ended June 30, 2009 was $7,488,000, compared to $9,292,000 for the six months ended June 30, 2008. Revenue for both periods primarily consisted of Fortical sales and royalties, which were $6,443,000 for the six months ended June 30, 2009, and $7,900,000 for the six months ended June 30, 2008. Fortical royalties were $2,404,000 for the six months ended June 30, 2009, compared to $2,613,000 for the six months ended June 30, 2008. Fortical sales were $4,039,000 for the six months ended June 30, 2009, compared to $5,287,000 for the six months ended June 30, 2008.

Total operating expenses were $6,645,000 for the three months ended June 30, 2009, an increase of $801,000 from $5,844,000 for the three months ended June 30, 2008.

Total operating expenses were $12,089,000 for the six months ended June 30, 2009, an increase of $384,000 from $11,705,000 for the six months ended June 30, 2008.

Net loss for the three months ended June 30, 2009 was $3,460,000, or $.04 per share, compared to a net loss of $1,201,000, or $.01 per share, for the three months ended June 30, 2008.

Net loss for the six months ended June 30, 2009 was $6,735,000, or $.07 per share, compared to a net loss of $3,055,000, or $.03 per share, for the six months ended June 30, 2008.

Cash at June 30, 2009 was $4,599,000, a decrease of approximately $3,985,000 from December 31, 2008. Accounts receivable at June 30, 2009 were $3,310,000.

Following are recent highlights and developments that will be discussed during Tuesday’s earnings call:

• According to IMS, in April 2009, Fortical^® had a 53% share of U.S. nasal calcitonin prescriptions, down from the 58% February market share. The decrease in market share is attributable to the early December launch of two products generic to the innovator product, but not to Fortical. Fortical sales and royalties increased 44% in the second quarter of 2009 as compared with the first quarter of 2009. We do not yet know the long-term effect on Fortical sales and royalties of the launch of these competing products. However, certain providers have substituted these products for Fortical, causing Fortical sales and royalties to decrease. Despite the availability of these competing products, their impact on Fortical prescriptions has been moderate to date and Fortical still remains the most frequently prescribed nasal calcitonin product in the U.S.
• For our oral calcitonin product, we are preparing for our upcoming Phase III trial and are finalizing our efforts to enlist a corporate partner and plan to transfer financial responsibility for the program as soon as possible.
• In May, we reported that our first patent covering our Site-Directed Bone Growth (SDBG) technology had issued. The technology, jointly invented in collaboration with Yale School of Medicine, is designed to facilitate and accelerate bone growth at precisely targeted locations in the body using a simple surgical procedure that can be performed on an outpatient basis with minimal invasiveness.
• In May, we drew down the remaining $5 million in non-convertible notes from our largest institutional stockholder. We will need additional sources of cash, from revenue or other sources, to meet our requirements in the near-term.

Unigene will host a conference call tomorrow morning, Tuesday, August 11th at 9:00 AM EDT, to discuss its second quarter 2009 financial results and to provide a Company update. The Company invites all those interested in hearing management’s discussion to join the call by dialing (877) 407-0782 for participants in the United States and (201) 689-8567 for international participants.