GTx third quarter net loss decreases to $8.6 million

Nov 9 2010

GTx, Inc. (Nasdaq: GTXI) today reported financial results for the third quarter of 2010. The net loss for the quarter ended September 30, 2010 was $8.6 million compared with a net loss of $12.8 million for the quarter ended September 30, 2009. For the nine months ended September 30, 2010, GTx reported net income of $22.8 million compared with a net loss of $35.4 million for the same period in 2009.

“GTx-758 has the potential to achieve medical castration without causing certain estrogen deficiency side effects such as hot flashes, bone loss and increased risk of fractures, and increased body fat composition changes.”

"In 2011, we plan to initiate a Phase II clinical trial to evaluate two doses of GTx-758 compared to Lupron® for first line treatment in men with advanced prostate cancer," said Dr. Mitchell S. Steiner, CEO of GTx. "GTx-758 has the potential to achieve medical castration without causing certain estrogen deficiency side effects such as hot flashes, bone loss and increased risk of fractures, and increased body fat composition changes."

Dr. Steiner continued: "As for Ostarine, we will have an end of Phase II meeting with FDA in December. Once we have received input from FDA, we plan to initiate a pivotal clinical trial for prevention and treatment of muscle wasting in patients with non-small cell lung cancer."

"We also are pleased to have completed a public offering of common stock raising net proceeds of $37.6 million to support clinical development activities at GTx," Dr. Steiner said.

Clinical Pipeline Updates

• GTx-758, a selective estrogen receptor alpha agonist, for first line treatment of advanced prostate cancer: In September 2010, GTx announced results of a Phase II open label pharmacokinetic/pharmacodynamic (PK/PD) clinical trial in 60 healthy young male volunteers in which treatment with 1000 mg and 1500 mg doses of GTx-758 demonstrated the ability to achieve medical castration (serum total testosterone < 50 ng/dL). Preclinical data regarding the effects of GTx-758 on human prostate cancer cells and on prostate size, bone markers and blood platelet aggregation in monkeys will be presented November 11, 2010 at the annual meeting of the Society of Basic Urologic Research being held in Atlanta, GA. Results of the GTx-758 Phase II PK/PD clinical trial will be presented December 9, 2010 at the annual meeting of the Society of Urologic Oncology being held in Bethesda, MD. In the first half of 2011, GTx is planning to initiate a Phase II clinical trial evaluating GTx-758 compared to Lupron® for first line treatment of advanced prostate cancer.
• Ostarine™, a selective androgen receptor modulator, for the treatment of cancer cachexia: GTx is preparing for an End of Phase II meeting with the FDA in December to gain concurrence from the agency on the proposed late stage clinical development of Ostarine ^TM for the treatment of cancer cachexia in non-small cell lung cancer patients. Following the FDA's input, GTx plans to initiate a pivotal clinical trial in 2011.
• Toremifene 80 mg for the reduction of fractures and treatment of other estrogen deficiency side effects in men with prostate cancer on androgen deprivation therapy: Projected third-party costs of the planned TREAT 2 Phase III clinical trial exceed the threshold established by GTx and Ipsen under the March 2010 amended collaboration and license agreement. GTx and Ipsen are in discussions with respect to the renegotiation of the terms of the collaboration, including the level of each company's funding commitments for the planned TREAT 2 clinical trial or whether to initiate the study.

Third quarter 2010 financial highlights

The net loss for the quarter ended September 30, 2010 was $8.6 million compared with a net loss of $12.8 million for the same period in 2009. For the nine months ended September 30, 2010, GTx reported net income of $22.8 million compared with a net loss of $35.4 million for the same period in 2009, due to the recognition of the remaining $49.9 million of unamortized revenue from GTx's collaboration with Merck & Co., Inc. and Merck's final payment of $5.0 million of cost reimbursement for research and development activities that will be received in December 2010.

Revenue for the third quarter of 2010 was $1.3 million compared to $3.6 million for the same period in 2009. Revenue for both periods included net sales of FARESTON^® 60 mg (toremifene citrate) tablets, marketed for the treatment of advanced metastatic breast cancer in postmenopausal women, and collaboration revenue from Ipsen Biopharm Limited. Net sales of FARESTON^® were $960,000 and $719,000 for the three months ended September 30, 2010 and 2009, respectively. Collaboration revenue was $336,000 and $2.9 million for the third quarter of 2010 and 2009, respectively. Revenue for the third quarter of 2009 also included collaboration revenue from Merck.

For the three months ended September 30, 2010 and 2009, research and development expenses were $5.6 million and $8.1 million, respectively. General and administrative expenses decreased during the three months ended September 30, 2010 to $4.1 million from $8.0 million for the three months ended September 30, 2009.

At September 30, 2010, GTx had cash, cash equivalents and short-term investments of $19.7 million. On November 1, 2010, GTx completed an underwritten public offering of common stock raising approximately $37.6 million, net of underwriting discounts and commissions and other estimated offering expenses. In early November, GTx was awarded a cash grant of approximately $1.2 million by the United States Government under the Qualifying Therapeutic Discovery Project. In addition GTx will receive a final $5.0 million cash payment from Merck in December 2010 for cost reimbursement for research and development activities.