Osiris Therapeutics reports financial results for the third quarter of 2009

Osiris TherapeuticsNov 4 2009

Osiris Therapeutics, Inc. (NASDAQ:OSIR), the leading stem cell therapeutic company focused on developing and marketing products to treat medical conditions in the inflammatory, cardiovascular and orthopedic areas, announced today its financial results for the third quarter of 2009.

Highlights and Recent Developments

Prochymal for Graft vs. Host Disease (GvHD)

• Phase III data for Prochymal in steroid-refractory GvHD (Protocol 280) showed significant improvement in response rates for both liver and gastrointestinal GvHD – the two most deadly forms of the disease.
• In pediatric patients with steroid-refractory GvHD, Prochymal more than doubled complete response rates compared to placebo.
• Strong enrollment continues in the pediatric expanded access program (Protocol 275) with more than 60 children now having received treatment with Prochymal.
• Survival in Protocol 275 exceeds 60% despite Prochymal’s use as a rescue agent for children who have failed an average of 3.2 lines of treatment prior to enrollment.

Other Corporate Developments

• Earned a $15 million milestone payment from NuVasive after they reached $35 million in cumulative Osteocel sales.
• Received the second $12.5 million installment payment from NuVasive related to the sale of Osteocel.
• Created a new Biosurgery Division focused on developing high-end biologic products for use in surgical procedures.
• Achieved a $750,000 milestone from the Juvenile Diabetes Research Foundation and expanded the Phase II type 1 diabetes trial to include pediatric patients.

“Having now treated more than 550 patients with GvHD, we are gaining a clear understanding of Prochymal’s impact in the context of this very deadly and very complex disease,” said C. Randal Mills, Ph.D., President and Chief Executive Officer of Osiris. “It appears that Prochymal’s effects are particularly profound in those patients with forms of the disease that do not respond to current standard of care. We believe that Prochymal will play an important role in the treatment of GvHD, and along with our partners at Genzyme, remain confident and committed to bringing this first-in-class stem cell therapy to the patients who desperately need effective treatments.”

Third Quarter Financial Results

For the third quarter of 2009, Osiris reported revenues of $10.6 million, compared to $1.0 million for the same period of the prior year. Current year third quarter revenue primarily reflects the recognition of $10.0 million in amortized license fees from Genzyme. For the third quarter of 2009, Osiris reported a net loss of $6.2 million or $0.19 per share, compared to a net gain, driven by the recognition of income from the sale of Osteocel, of $5.3 million or $0.17 per share for the same period of the prior year.

Research and development expenses for the third quarter of 2009 were $16.2 million, compared to $18.6 million incurred in the third quarter of 2008. General and administrative expenses were $1.5 million for the third quarter of 2009 compared to $1.9 million for the same period of the prior year. Net cash provided by continuing operations for the quarter was $40.7 million.

As of September 30, 2009, Osiris had $102.9 million of cash and short-term investments. This figure does not include the final $15 million milestone payment from NuVasive.