Medivation net loss decreases from $8.9M in second-quarter 2010 to $7.2M in second-quarter 2011

Aug 10 2010

Medivation, Inc. (Nasdaq: MDVN) today provided a corporate update and reported its financial results for the second quarter ended June 30, 2010.

"We have made positive progress in our dimebon program over the past few months," said David Hung, MD, president and chief executive officer of Medivation.  "In particular, I am pleased to announce that we have completed enrollment in our Phase 3 HORIZON trial in Huntington disease, exceeding our target of 350 patients by enrolling a total of 403 patients, and we expect to report top-line results from this trial in the first half of 2011.  We also have received feedback from the FDA confirming that we can use our Phase 3 CONCERT trial to complete our registration package for mild-to-moderate Alzheimer's disease, provided that the results are robustly positive.  We have multiple milestones ahead in the remainder of the year with the planned initiation of three new trials with MDV3100 and the expected completion of enrollment in our Phase 3 Alzheimer's disease trial, CONCERT and our Phase 3 prostate cancer trial, AFFIRM.  As we move toward these goals, our cash position remains strong and we continue to believe that based on current assumptions, existing cash is adequate to fund our currently planned operations beyond the end of 2012."

Recent Accomplishments and Anticipated Milestones

Dimebon (latrepirdine)

• Completed patient accrual in HORIZON, with a total of 403 patients enrolled versus our targeted enrollment of 350 patients.  This six-month, randomized, double-blind, placebo-controlled Phase 3 trial is evaluating dimebon's potential benefits on cognition and global function in patients with Huntington disease.  Top-line data from this trial are expected in the first half of 2011.
• Continued to enroll patients in CONCERT and remain on track to complete patient accrual in 2010. This 12-month randomized, double-blind, placebo-controlled Phase 3 clinical trial in patients with mild-to-moderate Alzheimer's disease is evaluating the potential efficacy of dimebon when added to ongoing treatment with donepezil.
• Presented the negative data from the Phase 3 CONNECTION trial to the Food and Drug Administration and received feedback that our prior Alzheimer's disease trial published in the Lancet plus CONCERT would be adequate to support approval for mild-to-moderate Alzheimer's disease, provided that the CONCERT results are robustly positive.

MDV3100

• Continued to enroll patients in the AFFIRM trial and remain on track to complete patient accrual in 2010. This randomized, double-blind, placebo-controlled Phase 3 survival trial is evaluating 160 mg/day of MDV3100 in men with castration-resistant prostate cancer who have been previously treated with docetaxel-based chemotherapy.
• On track to initiate three new MDV3100 trials in earlier-stage prostate cancer this year: a Phase 3 trial in men with chemotherapy-naive castration-resistant prostate cancer, which will be called PREVAIL; a Phase 2 head-to-head trial comparing MDV3100 with bicalutamide; and a Phase 2 trial in hormone-naïve patients. Initiation of the Phase 3 PREVAIL trial would trigger a milestone payment under the collaboration agreement with Astellas.

Second Quarter 2010 Financial Results

Revenue for the second quarter of 2010 was $15.8 million, consisting of partial recognition of the non-refundable up-front payments of $225.0 million received from Pfizer in the fourth quarter of 2008 and $110.0 million received from Astellas in the fourth quarter of 2009. Both up-front payments were recorded as deferred revenue upon receipt and are being recognized on a straight-line basis over the estimated performance period of the Company's obligations under the applicable collaboration agreement, which the Company presently expects to complete in the second quarter of 2013 for the Pfizer collaboration and in the fourth quarter of 2014 for the Astellas collaboration.

Total operating expenses for the second quarter were $23.2 million, compared with total operating expenses of $24.2 million for the same period in 2009.  These figures included non-cash stock-based compensation expense of $3.2 million in the quarter ended June 30, 2010, compared with $2.5 million for the same period in 2009.

For the six months ended June 30, 2010, total operating expenses were $56.7 million, compared with total operating expenses of $46.2 million for the same period in 2009. These figures include non-cash stock-based compensation expense of $6.7 million in the six months ended June 30, 2010, compared with $5.1 million for the same period in 2009.

Beginning in October 2008, Pfizer became responsible for 60 percent of all dimebon-related development and commercialization costs in the U.S., and 100 percent of such costs outside the U.S. Beginning in October 2009, Astellas became responsible for 50 percent of all MDV3100-related development and commercialization costs in the U.S. (other than costs for clinical trials supporting development in both the U.S. and either Europe or Japan, including the ongoing Phase 3 AFFIRM trial, the upcoming planned Phase 3 PREVAIL trial and the two additional trials in earlier-stage prostate cancer we expect to initiate in 2010, which costs are borne two-thirds by Astellas and one-third by Medivation) and 100 percent of such costs outside the U.S. The parties make quarterly true-up payments as necessary to ensure that each bears its applicable share of costs. For the second quarter of 2010, the net true-up payments payable to Medivation were $6.0 million and $7.0 million under the Pfizer and Astellas collaborations, respectively. Medivation presents these cost-sharing true-up payments in the applicable expense line of its consolidated statement of operations.

Medivation reported a net loss for the quarter ended June 30, 2010, of $7.2 million, or $0.21 per share, compared with a net loss of $8.9 million, or $0.29 per share, for the same period in 2009.  For the six months ended June 30, 2010, the net loss was $24.7 million, or $0.73 per share, compared with a net loss of $14.5 million, or $0.47 per share, for the same period in 2009.

Cash, cash equivalents and short-term investments at June 30, 2010, totaled $233.3 million, compared with $278.2 million at December 31, 2009, and $255.5 million at March 31, 2010.

Updated 2010 Financial Outlook

Medivation currently expects that total operating expenses for 2010, net of cost-sharing payments from Pfizer and Astellas, will be between $95 and $105 million, down from prior guidance of between $105 and $115 million.  The revised forecast includes approximately $13.0 million of non-cash stock-based compensation expense.

SOURCE Medivation, Inc.