POZEN reports revenue of $4.6 million for second quarter 2011

Jul 28 2011

POZEN Inc. (NASDAQ: POZN), a pharmaceutical company committed to transforming medicine that transforms lives, today announced results for the second quarter ended June 30, 2011.

Corporate Highlights

• The PA32540 Phase 3 pivotal studies are expected to be fully enrolled this quarter as planned. The primary endpoint in both studies is the cumulative incidence of gastric ulcers following administration of either PA32540 or 325 mg enteric-coated aspirin in subjects at risk for developing aspirin-associated ulcers. Completion of the 6-month studies is anticipated in Q1 2012 and the New Drug Application (NDA) filing is targeted for Q3 2012.
• The long term safety study, a 12-month, Phase 3 study to evaluate the long-term safety of PA32540 in subjects who are at risk for developing aspirin-associated gastric ulcers has been completed. We are in the process of reviewing the data.
• POZEN announced the appointment of Dr. Tomas Bocanegra as Executive Vice President, Development and the addition of Dr. Martin Nicklasson and Dr. Seth Rudnick to the Board of Directors.
• First half net sales of Treximet^® (sumatriptan / naproxen sodium) are up 3.5% year over year.
• First half sales of VIMOVO™ (naproxen / esomeprazole magnesium) delayed-release tablets were $10.1 million; $6.3 million in Q2 2011.
• VIMOVO was launched in 5 additional European countries in the second quarter of 2011.

Second Quarter Results

For the second quarter of 2011, POZEN reported revenue of $4.6 million, comprised of royalty on sales of Treximet and VIMOVO, of $4.0 million and $0.6 million, respectively. For the second quarter of 2010, the Company reported total revenue of $28.2 million, resulting from the amortization of upfront payments received pursuant to the collaboration agreement with AstraZeneca of $4.1 million, and royalty of $4.1 million on sales of Treximet, and the $20.0 million milestone payment from AstraZeneca resulting from the U.S. Food and Drug Administration (FDA) approval of VIMOVO.

Operating expenses for the second quarter of 2011 totaled $11.0 million, as compared to $12.1 million for the comparable period in 2010. The decreased operating expenses in the second quarter of 2011 were primarily due to $2.4 million less in patent litigation expenses, partially offset by higher PA32540 development and pre-commercialization expenses.

The Company reported a net loss of ($6.4) million, or ($0.21) per share on a diluted basis, for the second quarter of 2011, compared to net income of $16.2 million, or $0.53 per share on a diluted basis, for the second quarter of 2010.

Six Month Results

For the six months ended June 30, 2011, POZEN reported revenue of $9.0 million compared to $35.2 million for the same period in 2010. The decrease in revenue is due to prior year receipt of a $20.0 million milestone payment from AstraZeneca and the prior year amortization of upfront payments received pursuant to the collaboration agreement with AstraZeneca.

Operating expenses for the six months ended June 30, 2011 were $21.3 million compared to $22.0 million in the same period in 2010. The decrease in operating expenses is due to $4.5 million less in patent litigation costs, partially offset by higher PA32540 development and pre-commercialization costs.

The Company reported net loss of ($12.1) million, or ($0.40) per share on a diluted basis for the six month period ended June 30, 2011, compared to a net income of $13.2 million, or $0.44 per share on a diluted basis, for the same period in 2010.

Balance Sheet

At June 30, 2011, cash, cash equivalents and short-term investments totaled $52.6 million compared to $64.1 million at December 31, 2010. The Company had an accounts receivable balance of $4.6 million from GlaxoSmithKline and AstraZeneca at June 30, 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.