Halozyme Therapeutics first-quarter net loss decreases to $11.8 million

Halozyme Therapeutics, Inc.May 7 2010

Halozyme Therapeutics, Inc. (Nasdaq: HALO), a biopharmaceutical company developing and commercializing products targeting the extracellular matrix for the endocrinology, oncology, dermatology and drug delivery markets, today reported financial results for the first quarter ended March 31, 2010.

"Halozyme continues to execute its strategy of leveraging our unique technology and advancing our diverse pipeline to position the company for future growth," said Jonathan Lim, M.D., Halozyme's president and CEO. "I am pleased with the progress that Halozyme and its alliance partners, Roche and Baxter, have achieved so far in 2010. The use of our rHuPH20 enzyme in these alliance programs will allow for subcutaneous administration that can potentially improve patient convenience, save healthcare resources, and, in the case of Herceptin® SC, reduce the administration time to less than five minutes."

First Quarter 2010 and Recent Business Highlights

Our goal is to develop a best-in-class prandial insulin product in comparison to the current leading analogs on the market.

• New manufacturing and supply agreements with existing manufacturing partners have strengthened the supply chain for recombinant human hyaluronidase (rHuPH20). Halozyme amended an existing commercial supply agreement with Avid Bioservices, Inc., entered into a new commercial supply agreement with Avid, and entered into a new commercial supply agreement with Cook Pharmica LLC. These three agreements are expected to cover the commercial production of rHuPH20 to be used in the manufacture of current products as well as certain partnered product candidates such as Herceptin SC (subcutaneous) and GAMMAGARD with rHuPH20.
• Roche continues to successfully enroll patients in its ongoing Phase 3 Herceptin SC and Phase 1 MabThera® SC clinical trials. We expect additional clinical progress for the Halozyme-Roche alliance in 2010.  

First Quarter 2010 Financial Results

The net loss for the first quarter of 2010 was $11.8 million, or $0.13 per share, compared with a net loss for the first quarter of 2009 of $14.7 million, or $0.18 per share.

• Revenue for the first quarter of 2010 was $3.4 million, compared to $2.8 million for the first quarter of 2009. Revenues under collaborative agreements for the first quarter of 2010 were $3.0 million, compared to $2.7 million for the first quarter of 2009. Revenues under collaborative agreements in the first quarter 2010 primarily consisted of the amortization of upfront fees received from Baxter and Roche of $804,000 and research and development reimbursements from Baxter and Roche of $2.1 million.
• Research and development expenses for the first quarter of 2010 were $11.5 million, compared with $14.0 million for the first quarter of 2009, primarily due to lower manufacturing costs associated with clinical trial material and a decrease in clinical trial expenses.  
• Selling, general and administrative expenses for the first quarter of 2010 were $3.8 million, compared to $3.5 million for the first quarter of 2009, reflecting increased market research activities.  
• Cash and cash equivalents were $55.2 million as of March 31, 2010, compared with $67.5 million as of December 31, 2009 and $62.1 million as of March 31, 2009. Net cash burn for the first quarter of 2010 was approximately $12.3 million.

Upcoming Corporate and Scientific Presentations

Halozyme representatives are scheduled to present at the following conferences:

• Brean Murray, Carret & Co. 2010 Life Sciences Summit to be held in New York, May 17, 2010
• Jefferies and Company 2010 Global Life Sciences Conference to be held in New York, June 8-11, 2010
• American Diabetes Association Scientific Sessions – June 25-29, 2010 in Orlando. Halozyme expects to present the results for three studies from its Ultrafast Insulin program.