POZEN reports revenue of $4.5 million for first quarter 2011

May 5 2011

POZEN Inc. (NASDAQ: POZN), a pharmaceutical company committed to transforming medicine that transforms lives, today announced results for the first quarter ended March 31, 2011.

Corporate Highlights

• The Company was granted a preliminary injunction by the U.S. District Court for the Eastern District of Texas, ordering Par Pharmaceutical Inc. (Par) not to make, use, sell, offer to sell, or import into the United States a generic version of sumatriptan / naproxen sodium that competes with Treximet^® (sumatriptan / naproxen sodium) until a final decision in the patent case against Par and two other generic companies is issued.
• POZEN entered into a license agreement with Cilag GmbH International, a division of Johnson & Johnson, for the development and commercialization of MT 400 in Brazil, Colombia, Ecuador and Peru. MT 400 is POZEN's proprietary combination of sumatriptan and naproxen sodium, the first multiple mechanism triptan therapy for the treatment of migraine. POZEN previously licensed U.S.-only rights to MT 400 to GlaxoSmithKline, who markets a different dose of MT 400 as Treximet.
• VIMOVO™ (naproxen / esomeprazole magnesium) was launched in Canada, Netherlands and United Kingdom in the first quarter of 2011.
• The Company announced positive top-line results of a Phase 1 study of PA32540, a novel coordinated-delivery tablet of enteric-coated (EC) aspirin (325 mg) and immediate-release (IR) omeprazole (40 mg). The data from our Co-Rx Study suggest that PA32540 given in conjunction with clopidogrel, dosed at least 10 hours apart, resulted in significantly better inhibition of ADP-induced platelet aggregation (anti-clotting) when compared to a current standard of care (81 mg of EC aspirin, EC omeprazole 40 mg and clopidogrel).

First Quarter Results

For the first quarter of 2011, POZEN reported revenue of $4.5 million, comprised of royalty on sales of Treximet and VIMOVO, of $4.1 million and $0.4 million, respectively. For the first quarter of 2010, the Company reported total revenue of $6.9 million, resulting from the amortization of upfront payments received pursuant to the collaboration agreement with AstraZeneca of $3.1 million, and royalties of $3.8 million on sales of Treximet.

Operating expenses for the first quarter of 2011 totaled $10.2 million as compared to $9.9 million for the comparable period in 2010. The higher operating expenses in the first quarter of 2011 were primarily due to increases in costs associated with the PA32540 development program and pre-commercialization costs, partially offset by a reduction in patent litigation expenses.

The Company reported a net loss of $5.7 million, or $0.19 per share on a diluted basis, for the first quarter of 2011, compared to net loss of $3.0 million, or $0.10 per share on a diluted basis, for the first quarter of 2010.

Balance Sheet

At March 31, 2011, cash, cash equivalents and short-term investments totaled $56.8 million compared to $64.1 million at December 31, 2010. The Company had an accounts receivable balance of $4.5 million from GlaxoSmithKline and AstraZeneca at March 31, 2011.

Outlook

During 2011, POZEN plans to continue the late-stage clinical development of PA32540, along with its pre-commercialization activities. Additionally, we expect that patent litigation costs will be substantially less than the $9.4 million spent in 2010. Given that the final verdict on the Treximet patent litigation has not been issued, and the VIMOVO launch is still in its early stages, the Company will not provide annual financial guidance at this time.