Neurocrine third quarter revenue increases from $0.7 million to $14.4 million

Neurocrine Biosciences, Inc.Oct 29 2010

Neurocrine Biosciences, Inc. (Nasdaq: NBIX) today announced its financial results for the quarter ended September 30, 2010.

For the third quarter of 2010, the Company reported net income of $3.3 million, or $0.06 per share, compared with a net loss of $8.2 million, or $0.21 per share, for the same period in 2009. For the nine months ended September 30, 2010, the Company reported a net loss of $10.5 million, or $0.20 per share, as compared to a net loss of $43.1 million, or $1.11 per share, for the same period last year.

The Company's balance sheet on September 30, 2010 reflected total assets of $149.9 million, including cash, investments and receivables of $140.4 million.

"The financial impact of our two recent collaboration agreements with Abbott and Boehringer Ingelheim is evident in these third quarter financial results and the cash and investments position of Neurocrine," said Timothy P. Coughlin, Chief Financial Officer of Neurocrine Biosciences. "We will continue the fiscal discipline that has been ingrained in the Company over the past three years, while advancing our lead clinical programs; elagolix, VMAT2 and Urocortin 2 and bringing new clinical candidates forward from our research and discovery platform."

Revenues for the third quarter of 2010 were $14.4 million, compared to $0.7 million for the same period in 2009. Revenues for the nine months ended September 30, 2010 were $19.8 million, compared with $2.2 million for the same period in 2009. The increase in revenue is due to our recently executed collaboration agreements with Abbott and Boehringer Ingelheim, for our GnRH (elagolix) and GPR119 programs, respectively. During the third quarter of 2010, we recognized revenue of $8.5 million from amortization of up-front license fees and $5.2 million resulting from internal and external research and development expense reimbursement under these two agreements. During the nine month period ending September 30, 2010, we recognized revenue of $11.1 million from amortization of up-front license fees and $6.5 million resulting from internal and external research and development expense reimbursement under these two agreements.  

Research and development expenses increased to $8.2 million during the third quarter of 2010 compared with $7.4 million for the same period in 2009, primarily due to a one time personnel bonus during the third quarter of 2010. For the nine months ended September 30, 2010, research and development expenses were $23.1 million, compared to $29.1 million for the same period last year. The decrease in year-to-date research and development expenses is primarily due to a restructuring program enacted in the second quarter of 2009 coupled with ongoing expense management efforts.

General and administrative expenses increased to $3.6 million during the third quarter of 2010 compared with $3.0 million for the same period last year, primarily due to a one time personnel bonus during the third quarter of 2010. For the nine months ended September 30, 2010, general and administrative expenses were $10.0 million, compared to $12.0 million for the first half of 2009. The decrease in general and administrative expenses is primarily due to a restructuring program enacted in the second quarter of 2009 coupled with ongoing expense management efforts.

Other income decreased to $0.9 million during the third quarter of 2010 from $1.5 million of other income for the third quarter of 2009. Other income increased from $1.6 million of income during the first nine months of 2009 to $3.1 million of other income for the first nine months of 2010. This change resulted primarily from a one-time $1.5 million loss recognized on auction rate securities in the first quarter of 2009.

Pipeline Highlights

Elagolix Update

Neurocrine and Abbott filed the end of Phase II meeting request with the FDA in late September 2010, an end of Phase II meeting is scheduled to occur in January 2011. Upon receipt of the written minutes of the meeting, the Company will provide an update as to the timing around the elagolix program.

Technology and information transfer from Neurocrine to Abbott are underway and proceeding well. The transfer of the Investigational New Drug applications for elagolix from Neurocrine to Abbott has been completed. Abbott and Neurocrine are currently planning Endometriosis Phase III and Uterine Fibroids Phase II studies.

The four month open label extension portion of the Daisy PETAL Study (901)  was completed in late September 2010. We expect to have additional safety and efficacy data from this portion of the 901 study later this year.

Urocortin 2 Update

The Christchurch Cardioendocrine Research Group at University of Otago, Christchurch School of Medicine and Health Sciences, New Zealand, in collaboration with the Company, is enrolling patients with Acute Decompensated Heart Failure in a Phase II study of Urocortin 2, and has enrolled 32 patients as of mid October, of a planned total patient population of 50.

Additionally, Urocortin 2 studies are underway at the Centre for Cardiovascular Sciences at The University of Edinburgh through a British Heart Foundation grant. The first component of nine studies are being conducted in both healthy volunteers and patients with stable congestive heart failure to determine the impact of Urocortin 2 infusions on biomarkers of cardiovascular function and dysfunction.

VMAT2 Update

The VMAT2 development program successfully completed Phase I safety studies in healthy male volunteers. Neurocrine plans to initiate a Phase IIa dose exploration study in patients with Tardive Dyskinesia in late 2010.

Corticotropin Releasing Factor (CRF1) Receptor Antagonists Update

GSK completed a multicenter randomized, double-blind, placebo-controlled trial designed to assess the safety and efficacy of GSK561679 in approximately 150 subjects with Major Depressive Disorder over six weeks of treatment. Statistical analysis using the intent-to-treat population revealed no benefit of GSK561679 compared with placebo on both the Bech Melancholia and HAMD-17 endpoints.

Emory University of Atlanta and Mt. Sinai Medical Center in New York, in conjunction with GSK, have recently initiated a Phase II clinical trial evaluating GSK561679 in women with post-traumatic stress disorder. This study is a randomized, double-blind, placebo-controlled trial which is expected to enroll approximately 150 patients for a six-week treatment period and is expected to take several years to complete.