Osiris Therapeutics first quarter total revenues decrease to $4.6M

Osiris TherapeuticsMay 11 2012

Osiris Therapeutics, Inc. (NASDAQ: OSIR), the leading stem cell company focused on developing and commercializing products to treat medical conditions in inflammatory, cardiovascular, orthopedic, and wound healing markets, announced today its results for the first quarter ended March 31, 2012.

“This was an excellent quarter all around for Osiris”

Highlights and Recent Developments

• Strong demand for Grafix® and Ovation® fuels Biosurgery revenue growth to $1.14 million for the quarter - an increase of 49% over the previous quarter.
• Manufacturing efficiencies drive gross margin on Biosurgery products up 8 percentage points over the previous quarter to 66%.
• Capacity expansion in manufacturing initiated to keep pace with product demand.
• CMS issues positive preliminary decision on request to establish HCPCS codes for Grafix product line. Final decision to be rendered by the end of 2012.
• Biosurgery distribution expands its geographic coverage into eight additional states.
• Full response filed to inquiries from the Biologics and Genetic Therapies Directorate of Health Canada regarding the Prochymal® (remestemcel-L) New Drug Submission and post marketing commitments.
• Health Canada's independent expert advisory panel issues a favorable decision on Prochymal.
• A decision on Prochymal is expected from Health Canada during May.
• Four new patents issued in the U.S. and Canada covering the use of mesenchymal stem cells for the treatment of graft versus host disease (GvHD) and cardiac disorders.
• Finished the quarter with a strong cash, receivables and short-term investment position of $44.2 million.

"This was an excellent quarter all around for Osiris," said C. Randal Mills, Ph.D., President and Chief Executive Officer of Osiris Therapeutics. "It is gratifying to witness the solid growth of our Biosurgery products, driven by Osiris' continued clinical success. I am particularly proud of how well our team is executing during our transition into a fully commercial entity, including our ability to tackle challenging reimbursement issues and expand our manufacturing and distribution capabilities."

First Quarter Financial Results

Biosurgery product revenue rose 49% from the previous quarter to $1.14 million. Total revenues were $4.6 million in the first quarter of 2012, which include the final amortization of license fees from our collaboration agreements. Total revenues in the first quarter of 2011 were $10.4 million, and consisted almost exclusively of amortized license fees. Net loss for the first quarter of 2012 was $1.3 million compared to net income of $4.0 million in the first quarter of 2011.

Research and development expenses for the first quarter of 2012 were $4.0 million, compared to $4.7 million incurred in the first quarter of 2011. General and administrative expenses were $1.5 million for the first quarter of 2012 compared to $1.7 million for the same period of the prior year. Net cash used in operations for the three months ended March 31, 2012 was $4.0 million. As of March 31, 2012, Osiris had $44.2 million of cash, receivables and short-term investments.