Spectrum Pharmaceuticals Reports Third Quarter Financial Results
Shares of common stock outstanding on November 11, 2003 were 6,514,697.
Spectrum had cash and equivalents of $24.9 million on September 30, 2003, compared to $1.6 million on December 31, 2002. The increase reflects financing activities during 2003, including two financings completed during the third quarter of 2003. During the first nine months of 2003, the Company raised $3.5 million (net of offering costs and commissions) through the sale of common stock and warrants, and $23.4 million (net of offering costs and commissions) through the sale of convertible preferred stock. In early October 2003, the Company received $2 million in cash from GPC Biotech AG pursuant to their co-development and licensing agreement for satraplatin. The payment was triggered when the first patient in the satraplatin Phase 3 registrational hormone-refractory prostate cancer trial was treated in late September 2003, and was comprised of a $1 million license fee and a $1 million investment to purchase 128,370 shares of our common stock.
"The Company completed its financial and strategic restructuring during the third quarter, and we believe we are now moving into the growth phase of our plan at Spectrum Pharmaceuticals," stated Rajesh C. Shrotriya, M.D., Chairman, Chief Executive Officer and President. "As the quarter closed, our co-development partners GPC Biotech received fast track designation and initiated the phase 3 study of our lead drug, satraplatin, in hormone-refractory prostate cancer. Additionally, we finalized plans to initiate a phase 2 study of Eoquin™ in bladder cancer, and secured the clinical supplies necessary to launch a phase 2 study of elsamitrucin in non-Hodgkin's lymphoma next year. In the generic business, the review of our first drug ciprofloxacin continues and we filed an ANDA for our second drug, carboplatin, just after the quarter ended. I am proud of the progress made, and look forward to our continued progress in the months and years ahead."
The increase in net loss during the third quarter of 2003 as compared to the same period in 2002, is principally attributable to a $1.6 million non-cash charge for employee stock compensation. Upon the completion of the strategic and financial restructuring of the Company, the Board granted options and stock purchase rights to employees, officers and consultants of the Company in recognition of their contributions in the turn around of the Company. As a result the Company had to recognize a compensation expense for such grants during the quarter. This charge was offset by a decline in research and development and general and administrative expenses combined during the third quarter of 2003. This decline is attributable to the termination of the Company's neurology research efforts and cost-cutting efforts implemented by the Company over the past twelve months. Together, general and administrative and research and development expenses fell from $3.1 million during the third quarter of 2002 to $2.0 million during the third quarter of 2003.
Spectrum Pharmaceuticals' primary focus is to develop in-licensed drugs for the treatment and supportive care of cancer patients. The Company's lead drug, satraplatin, is a phase 3 oral, anti-cancer drug being co-developed with GPC Biotech AG, which has been granted fast-track status by the United States Food and Drug Administration. Elsamitrucin, a phase 2 drug, will initially target non-Hodgkin's lymphoma. Eoquin™ is being studied in the treatment of superficial bladder cancer, and may have applications as a radiation sensitizer. The Company is actively working to develop, seek approval for and oversee the marketing of generic drugs in the U.S. Spectrum also has a pipeline of pre-clinical neurological drug candidates for disorders such as attention-deficit hyperactivity disorder, schizophrenia, mild cognitive impairment and pain, which it is actively seeking to out-license or co-develop. For additional information about the Company, visit the Company's web site at www.spectrumpharm.com.
This press release may contain forward-looking statements regarding future events and the future performance of Spectrum Pharmaceuticals that involve risks and uncertainties that could cause actual results to differ materially. These statements include but are not limited to statements regarding our plans for growth, future clinical trials and the status of our ANDAs, and any other statements that relate to the intent, belief, plans or expectations of the company or its management, or that are not a statement of historical fact. Risks that could cause actual results to differ include our lack of revenues and need for additional financing, the possibility that our existing drug product candidates may not prove to be safe or effective, our limited experience in establishing and maintaining strategic alliances, our dependence on our co-development partner for the conduct of clinical trials for our lead drug, our limited experience with the generic drug industry and other risks that are described in further detail in the Company's reports filed with the Securities and Exchange Commission.
SPECTRUM PHARMACEUTICALS, INC. Summary Consolidated Condensed Statement of Operations (Unaudited) Three Months Ended September 30, 2003 2002 ---- ---- Revenues $ 1,000,000 $ 2,008,334 ----------- ----------- Operating expenses: Research and development 787,691 2,685,555 General and administrative 1,252,747 461,201 Employee stock compensation 1,558,861 - Restructuring expense - 1,381,088 ----------- ----------- Total operating expenses 3,599,299 4,527,844 ----------- ----------- Loss from operations (2,599,299) (2,519,510) Other income (expense), net (120,689) 166,378 ----------- ----------- Net loss $(2,719,988) $(2,353,132) =========== =========== Basic and diluted loss per common share $ (0.71) $ (1.50) =========== =========== Basic and diluted weighted average common shares outstanding 3,975,271 1,564,664 =========== =========== Summary Consolidated Condensed Balance Sheets (Unaudited) September 30, December 31, 2003 2002 ---- ---- Cash, cash equivalents, marketable securities and short-term investments $24,913,423 $1,578,338 Other current assets 2,109,866 992,772 ----------- ---------- Total current assets 27,023,289 2,571,110 Property and equipment, net and other assets 673,844 882,010 ----------- ---------- Total assets $27,697,133 $3,453,120 =========== ========== Current liabilities $ 4,219,117 $2,521,691 Long term liabilities and other 34,921 259,077 Series E Convertible Preferred Stock subject to redemption 10,000,000 - Stockholders' equity 13,443,095 672,352 ----------- ---------- Total liabilities and stockholders' equity $27,697,133 $3,453,120 =========== ==========
For further information, please contact:
Raj Shrotriya CEO and President Spectrum Pharmaceuticals, Inc. (949) 788-6700, ext. 295