Fourth-quarter and full year fiscal 2009 results announced by Biodel

Biodel Inc.Dec 10 2009

Biodel Inc. (Nasdaq: BIOD) today reported financial results for the fourth quarter and fiscal year ended September 30, 2009.

Fourth Quarter and Fiscal Year 2009 Financial Results

Biodel reported a net loss for the quarter ended September 30, 2009 of $10.5 million, or $0.44 per share, compared to a net loss of $12.7 million, or $0.53 per share, for the fourth quarter of fiscal year 2008.

Net loss applicable to common stockholders for the year ended September 30, 2009 was $43.3 million, or $1.82 per share, compared to $43.4 million, or $1.94 per share, for the fiscal year ended September 30, 2008.

Research and development expenses were $7.9 million for the three months ended September 30, 2009, compared to $11.0 million for the same period in the prior year. For the 2009 fiscal year, research and development expenses were $32.3 million, compared to $32.6 million for the 2008 fiscal year. The decrease in research and development expenses was primarily due to reductions in certain clinical and manufacturing expenses, and was offset by costs related to the purchase of recombinant human insulin to build commercial supply inventory for VIAject® and to costs associated with the preparation of the filing of the planned new drug application, or NDA, for VIAject®.

General and administrative expenses totaled $2.6 million for the three months ended September 30, 2009, compared to $3.0 million for the same period in the prior year. General and administrative expenses totaled $11.0 million for the year ended September 30, 2009, compared to $14.8 million for the fiscal year 2008. The decrease in general and administrative expenses was attributable to reductions in share-based compensation, professional fees and travel expenses.

Expenses for the fiscal year ended September 30, 2009 and 2008 include $5.1 and $6.5 million in stock-based compensation expense related to options granted to employees and non-employees.

Biodel did not recognize any revenue during fiscal years 2009 or 2008.

At September 30, 2009, Biodel had cash and cash equivalents of $54.6 million and 23.8 million shares outstanding.

Business Review

Biodel is completing an NDA for submission to the U.S. Food and Drug Administration by the end of 2009 for approval to market VIAject® as a treatment for diabetes. The NDA will include results from multiple pharmacokinetic, pharmacodynamic and standardized meal studies, the two completed pivotal Phase 3 clinical trials of VIAject® in patients with Type 1 and Type 2 diabetes, as well as interim results from the long-term safety extension trial for patients who completed the pivotal Phase 3 clinical trials.

Update on Preliminary Results of Phase 3 Trials

Biodel completed its two pivotal Phase 3 clinical trials of VIAject® in July 2008, and presented preliminary results from the trials in September 2008 at the annual meeting of the European Association for the Study of Diabetes. The primary objective of the trials was to determine if VIAject® is not inferior to Humulin® R in the management of blood glucose levels, as measured by the mean change in patients’ glycosylated hemoglobin, or HbA1c, levels from baseline to the end of the trial. HbA1c levels are a measure of patients’ average blood glucose levels over a period of approximately 3 months.

Predefined secondary endpoints in the trials included rates of severe and non-severe hypoglycemic events, and changes in body weight.

In the company’s final analysis of the Type 1 and Type 2 trials, HbA1c decreased comparably in the treatment groups, thereby achieving the primary endpoint of statistical non-inferiority. In the Type 1 trial, a statistically significant interaction associated with HbA1c data from India was observed and efficacy results from India were, therefore, not comparable to the results from the United States and Germany. When the interaction is taken into account, non-inferiority in the Type 1 trial is achieved.

In the company’s final analysis of the data from the pivotal Phase 3 clinical trial in patients with Type 1 diabetes, patients receiving Humulin® R were twice as likely to have one or more severe hypoglycemic events when compared to those receiving VIAject®. This result did not achieve statistical significance due to the small number of patients experiencing one or more severe hypoglycemic events (15 patients in the Humulin® R arm and 8 patients in the VIAject® arm, for a total of twenty-three patients). Patients receiving VIAject® lost 0.1 pounds on average, while patients receiving Humulin® R gained 3.1 pounds on average, for a difference of 3.2 pounds. This result was statistically significant.

In the company’s final analysis of the data from the pivotal Phase 3 clinical trial in patients with Type 2 diabetes, the median number of non-severe hypoglycemic events in the Humulin® R arm was twice as great as in the VIAject® arm. Patients treated with VIAject® gained less weight than patients treated with Humulin® R. Patients receiving VIAject® gained 1.0 pounds on average, while patients receiving Humulin® R gained 3.0 pounds on average, for a difference of 2.0 pounds. Both the hypoglycemia and weight results were statistically significant. With regard to severe hypoglycemic events, no meaningful comparison was possible due to the small number of events that occurred in both the VIAject® and the Humulin® R treatment groups.

Update on VIAject® Formulation

Since completing the pivotal Phase 3 clinical trials, the company has developed other formulations of VIAject® and successfully bridged from the pH 4, 25 IU/cc, two-vial lyophilized formulation used in the pivotal trials to a pH4, 100 IU/cc liquid formulation. Recently, the company successfully bridged to a pH 7 100 IU/cc liquid formulation upon which the NDA for VIAject® will now be based. The pH 7 formulation may offer certain commercial advantages, including increased stability and greater tolerability. A recent tolerability study demonstrated a statistically significant reduction in injection site discomfort with the pH7 100 IU/cc liquid formulation of VIAject® compared to the lyophilized formulation. A majority of patients in this tolerability study experienced the same or less discomfort with the liquid formulation of VIAject® than they did with their usual meal-time insulin, although a subset of patients experienced more injection site discomfort with the liquid formulation of VIAject® than they did with Humalog®.

Biodel is developing the 100 IU/cc liquid formulation for use in two presentations: in vials for use with syringes and insulin pumps, and cartridges for use in both disposable and reusable pen injectors. The company recently executed a letter of intent to purchase a disposable insulin pen designed by Wockhardt Ltd. for use with VIAject®. The company intends to submit this pen to the FDA for review subsequent to filing the VIAject® NDA upon completing certain modifications that the company believes will improve its commercial performance.