A.P. Pharma reports net loss of $1.9M for fourth-quarter of 2009

Mar 15 2010

A.P. Pharma, Inc. (NASDAQ: APPA), a specialty pharmaceutical company, today reported financial results for its fourth quarter and full year ended December 31, 2009.

“2009 was an important year for A.P. Pharma. We achieved a major milestone with the submission of a New Drug Application for APF530, which is being developed for the prevention of chemotherapy-induced nausea and vomiting”

“2009 was an important year for A.P. Pharma. We achieved a major milestone with the submission of a New Drug Application for APF530, which is being developed for the prevention of chemotherapy-induced nausea and vomiting,” said Ronald Prentki, A.P. Pharma’s president and chief executive officer. “We also improved the financial position of the Company through the completion of a successful stock sale and the implementation of cost reduction measures, which provided resources for the continued development of APF530.”

• In May, the Company submitted a New Drug Application (NDA) for APF530, to the U.S. Food and Drug Administration (FDA), which the agency accepted for review in July.
• In September, the Company announced the completion of a license and development agreement with Merial, a major animal healthcare company, for a long-acting pain management product using A.P. Pharma’s Biochronomer™ technology.
• In October, the Company completed a private placement providing aggregate proceeds of up to $13.1 million, consisting of a first tranche of common stock and warrants in October 2009 yielding aggregate proceeds of approximately $8.1 million, and a potential second tranche of common stock exercisable at the option of the investors prior to May 15, 2010 for proceeds of up to approximately $5 million.

Results of Operations

A.P. Pharma’s net loss for the fourth quarter of 2009 was $1.9 million, or $0.05 per share, compared with a net loss of $3.9 million, or $0.13 per share, for the fourth quarter of 2008. For the full year 2009, the Company’s net loss was $10.0 million, or $0.31 per share, versus a net loss of $23.1 million, or $0.75 per share, for 2008. The improved operating results in both the quarter and the year ended December 31, 2009 were principally due to A.P. Pharma’s decision to suspend, for the time being, development of its other product candidates in order to focus its resources on the submission and approval of the NDA for APF530, as well as other cost containment initiatives undertaken by the Company.

Contract revenue was $122,000 in the fourth quarter of 2009, and $1.3 million for all of 2009, compared with $20,000 and $369,000, respectively, for 2008. The increase in revenue for 2009 reflects $1.0 million of previously deferred revenue recognized as the result of the termination of a partner agreement in 2009, as well as revenue associated with a development program utilizing our proprietary Biochronomer™ technology with Merial.

Cash, cash equivalents and marketable securities as of December 31, 2009 were $7.6 million, compared with $10.5 million at December 31, 2008. The Company believes its cash and cash equivalents as of December 31, 2009 will enable it to fund its operations through 2010, based on anticipated spending levels and certain expected positive cash inflows.