Immunomedics reports net loss of $3.4M in total revenues for second quarter 2011

Feb 5 2011

Immunomedics, Inc. (Nasdaq:IMMU), a biopharmaceutical company primarily focused on the development of monoclonal antibody-based products for the targeted treatment of cancer, autoimmune and other serious diseases, today reported financial results for the second quarter ended December 31, 2010. The Company also highlighted recent key developments and planned activities for its clinical pipeline.

Second Quarter Fiscal 2011 Results

The Company reported total revenues of $1.0 million and a net loss of $3.4 million, or $0.05 per share, for the second quarter of fiscal year 2011, which ended December 31, 2010. This compares to total revenues of $5.1 million and a net income of $0.8 million, or $0.01 per share, for the same period last fiscal year. The decrease of $4.1 million is principally the result of $3.9 million of deferred license fee revenue from the Nycomed Agreement recorded in the three month period ended December 31, 2009.  We had completed our obligations under the Agreement and, accordingly, we recorded the final amortization of the upfront fees deferred under this Agreement in fiscal year 2010. Costs and expenses increased $3.0 million in the second quarter of fiscal 2011 principally from higher research and development expenses mainly from lower expense reimbursements under a collaboration agreement, as well as increased clinical trial and patent related expenses.  The resulting higher operating loss was partially offset by the $2.9 million of other income reported in the second quarter of fiscal 2011 for the Qualifying Therapeutic Discovery Project (QTDP) program awards from the Internal Revenue Service of the Department of Treasury.

For the first half of fiscal year 2011, the Company reported total revenues of $2.5 million and a net loss of $9.9 million, or $0.13 per share. This compares to total revenues of $44.1 million and net income of $32.8 million, or $0.43 per diluted share, for the same period last fiscal year. The decrease in revenue is the result of the fact that the current fiscal period does not reflect any deferred license fee revenues from either the UCB Agreement or the Nycomed Agreement, which were $31.2 million and $10.6 million, respectively, for the six month period ended December 31, 2009.  We had recorded the final amortization of the upfront fees under these Agreements in fiscal year 2010 because we completed our obligations under these Agreements. Costs and expenses were $4.0 million higher in the first half of fiscal 2011 primarily due to increased research and development expenses resulting from lower expense reimbursements under a collaboration agreement, increased clinical trial and patent related expenses and higher G&A expenses as a result of higher legal fees.  As mentioned above, the resulting higher operating loss was partially offset by the QTDP awards.

As of December 31, 2010, the Company had $21.3 million in cash and cash equivalents. In January 2011, the Company received $8.6 million in proceeds from the sale of its two remaining Auction Rate Securities. 

"We have been able to maintain our cash utilization rate while continuing to advance our R&D programs," commented Gerard G. Gorman, Senior Vice President, Finance and Business Development, and Chief Financial Officer. "We are encouraged with our recently reported results with yttrium-90-labeled clivatuzumab tetraxetan indicating the potential for improved overall survival rates in patients with advanced, inoperable pancreatic cancer, as reported at the 2011 Gastrointestinal Cancers Symposium, and we look forward to confirming these promising results in randomized studies," he added.

Key clinical developments and future planned activities:

Epratuzumab

• UCB has initiated a Phase III program for epratuzumab in lupus in which 2 trials, EMBODY™ 1 and EMBODY™ 2, will each enroll approximately 780 patients with moderate to severe systemic lupus erythematosus. (Please refer to the Company's press release at www.immunomedics.com/news_pdf/2010_PDF/PR12142010.pdf for more information).
   
• Results from Cancer and Leukemia Group B's Phase II study combining epratuzumab and rituximab as initial therapy for patients with follicular non-Hodgkin's lymphoma were reported in an oral presentation at the 52^nd annual meeting of the American Society of Hematology. (For more information, please refer to the Company's press release at www.immunomedics.com/news_pdf/2010_PDF/PR12062010a.pdf).

Veltuzumab

• Nycomed has submitted regulatory filings for a Phase II study of the subcutaneous formulation of veltuzumab in patients with rheumatoid arthritis. The trial is expected to begin patient enrollment in the first quarter of calendar year 2011 in the United States while regulatory approval in Europe is pending.

Clivatuzumab tetraxetan

• Results updated at the 2011 Gastrointestinal Cancers Symposium indicated that treatments with fractionated yttrium-90-labeled clivatuzumab tetraxetan in combination with gemcitabine extend survival of patients with inoperable, advanced pancreatic cancer. (For more information, please refer to the Company's press release at www.immunomedics.com/news_pdf/2011_PDF/PR01212011.pdf).

Milatuzumab

• Preliminary results from a Phase I/II study combining milatuzumab with veltuzumab in patients with relapsed or refractory B-cell non-Hodgkin's lymphoma were presented at the 2010 American Society of Hematology annual meeting. (Please refer to the Company's press release at www.immunomedics.com/news_pdf/2010_PDF/PR12052010.pdf for more information).