Arena Pharmaceuticals reports lower net loss of $31.3 million in first-quarter 2010

Arena Pharmaceuticals, Inc.May 7 2010

Arena Pharmaceuticals, Inc. (Nasdaq: ARNA) today reported financial results for the first quarter ended March 31, 2010.

Arena reported a lower net loss in the first quarter of 2010 of $31.3 million, or $0.33 per share, compared to a net loss in the first quarter of 2009 of $50.6 million, or $0.68 per share.

"We believe that lorcaserin represents a significant medical and commercial opportunity based on the drug candidate's unique combination of safety, efficacy and tolerability in our pivotal trial program," stated Jack Lief, Arena's President and Chief Executive Officer. "We look forward to continued interaction with the FDA to complete its review of the lorcaserin NDA. If approved, lorcaserin has the potential to reenergize the weight management pharmacotherapy market and improve the treatment of obesity."

As expected, research and development expenses declined significantly to $18.3 million in the first quarter of 2010 from $42.6 million in the first quarter of 2009. This decrease is primarily attributable to the completion of our pivotal Phase 3 clinical trials for lorcaserin. Research and development expenses included $0.9 million in non-cash, share-based compensation expense in both of the quarters ended March 31, 2010 and 2009. General and administrative expenses totaled $7.0 million in the first quarter of 2010, compared to $7.6 million in the first quarter of 2009. This decrease in general and administrative expenses is primarily attributable to decreased corporate and patent legal fees. General and administrative expenses in the first quarter of 2010 included $1.0 million in non-cash, share-based compensation expense, compared to $1.1 million in the first quarter of 2009. Interest expense of $7.7 million was recorded in the first quarter of 2010, compared to $1.7 million in the first quarter of 2009. This increase is primarily attributable to interest expense, most of which is non-cash, related to the loan Arena received in July 2009.

At March 31, 2010, cash, cash equivalents and short-term investments totaled $107.6 million and approximately 101.2 million shares of common stock were outstanding.

Arena's Recent Developments

• The US Food and Drug Administration, or FDA, accepted Arena's New Drug Application, or NDA, for lorcaserin and assigned a Prescription Drug User Fee Act, or PDUFA, date of October 22, 2010, for review of the application. The NDA is based on a data package from lorcaserin's development program that includes 18 clinical trials totaling 8,576 patients. The pivotal Phase 3 clinical trials, BLOOM and BLOSSOM, evaluated nearly 7,200 patients treated for up to two years. In both trials, lorcaserin produced highly statistically significant weight loss with excellent safety and tolerability.
• Initiated a Phase 1 clinical trial of APD916, a novel oral drug candidate discovered by Arena that targets the histamine H3 receptor for the treatment of narcolepsy and cataplexy. This randomized, double-blind and placebo-controlled Phase 1 trial will evaluate the safety, tolerability and pharmacokinetics of single-ascending doses of APD916.
• Received aggregate net proceeds of $24.2 million from the sale of approximately 8.3 million shares of common stock under an equity financing commitment with Azimuth Opportunity Ltd, which terminated in connection with this financing.