MiddleBrook Pharmaceuticals, Inc. (Nasdaq: MBRK) today announced
financial and operational results for the quarter ended June 30,
2009.
Second Quarter 2009 Financial
Results:
MiddleBrook reported second quarter 2009 revenue of $2.1
million, compared to revenue of $2.5 million in the second quarter
of 2008. Net factory sales of MOXATAG (extended-release
amoxicillin) Tablets, 775 mg, totaled $0.4 million for the 2009
second quarter, and net sales for the KEFLEX® (cephalexin, USP)
franchise totaled $1.7 million.
Net loss was $19.6 million for the 2009 second quarter, compared
to a net loss of $3.7 million attributable to MiddleBrook in the
second quarter of 2008. Net loss per share during the second
quarter of 2009 was $0.23, compared to a net loss per share of
$0.07 in the prior-year quarter.
MiddleBrook reported cost of goods sold in the amount of $0.3
million for the 2009 second quarter, compared to $0.4 million in
the prior year period. Research and development (R&D) expense
in the second quarter of 2009 was $1.5 million, compared to second
quarter 2008 R&D expense of $3.6 million. Selling, general and
administrative expense was $20.0 million in the second quarter of
2009, compared to $3.9 million in the prior-year period.
As of June 30, 2009, MiddleBrook’s cash, cash equivalents, and
marketable securities totaled $44.5 million, compared to $55.4
million at the end of first quarter 2009.
“The second quarter represented the first full quarter of our
MOXATAG launch, and we achieved steady month-over-month gains in
the number of prescriptions throughout the period,” said
MiddleBrook President and CEO John Thievon. “Most importantly,
feedback from the field indicates strong acceptance for MOXATAG by
healthcare professionals.”
“While the economic environment remains challenging,” Thievon
continued, “we believe that our improved distribution, increased
managed care coverage and new marketing programs will help us
increase our market share as we enter the strep throat season.”
KEFLEX PULSYS Development
Update:
MiddleBrook previously announced that it had planned to start
its Phase III clinical trial for its KEFLEX PULSYS product
candidate in 2010, contingent upon the success of the MOXATAG
launch and the FDA’s agreement with MiddleBrook’s clinical
protocol. MiddleBrook submitted a Special Protocol Assessment (SPA)
to the FDA in June for its KEFLEX PULSYS product candidate. The FDA
responded to MiddleBrook’s SPA on July 30, 2009. At this time,
MiddleBrook has not gained agreement with the FDA regarding the
non-inferiority design and planned analysis of the study as
outlined in MiddleBrook’s SPA. Accordingly, MiddleBrook is delaying
the development of its KEFLEX PULSYS product candidate. Any future
development is contingent upon the successful commercialization of
MOXATAG, adequate financial resources, and the FDA’s agreement with
a revised study design.
Outlook:
MiddleBrook is revising its 2009 annual revenue guidance and
expense estimate. The Company now expects combined 2009 net sales
for MOXATAG and KEFLEX to be less than $25 million due to
slower-than-anticipated prescription growth and the projected gross
margin impact of the new $20 maximum copay program for MOXATAG.
MiddleBrook has also reduced expenses, and the Company now
anticipates that total operating expenses for 2009 will range
between $83 and $88 million, versus its previous estimate of total
operating expenses ranging between $93 and $100 million.
“MOXATAG’s prescription numbers to-date show that we are
trending at about 60% of our initial prescription forecast,” said
Dave Becker, MiddleBrook executive vice president and CFO. “We will
continue to focus on controlling expenses while we work to
successfully commercialize MOXATAG, and we are eager to see how our
enhanced marketing efforts affect prescription growth as we enter
the upcoming strep throat season.”
“As a result of the FDA’s response to our SPA, we have
intensified our business development activities in pursuit of
product opportunities that would be complementary to MOXATAG,” said
MiddleBrook President and CEO John Thievon. “Accordingly, we
anticipate that additional financing may be necessary to pursue
such opportunities and/or to fund operations.”
Second Quarter 2009 Conference
Call and Webcast
As previously announced, MiddleBrook Pharmaceuticals is
releasing its financial and operational results for the second
quarter of 2009 today, Thursday, August 6, 2009, before the market
opens. At 9:00 a.m. (ET) today, MiddleBrook management will conduct
a conference call to review results for the second quarter.
To listen live to the call, dial 1-800-813-8504 or
1-660-422-4526. A replay of the call will be available starting at
approximately 11 a.m. on August 6 through 5 p.m. on August 13,
2009. To listen to the replay, dial 1-800-642-1687 or
1-706-645-9291, and enter the conference ID #19864871.
A live audio webcast of the conference call also will be
available by going to the Investor Relations section of
MiddleBrook's web site, www.middlebrookpharma.com. A replay of the
webcast will also be available on the Company’s website for
approximately one year.
MiddleBrook Pharmaceuticals Reports Inducement
Grants Under NASDAQ Marketplace Rule 4350
MiddleBrook Pharmaceuticals also announced today that on July
31, 2009, it granted options to purchase a total of 17,500 shares
of MiddleBrook's common stock to seven (7) new employees as a
material inducement for them to join MiddleBrook. The options were
granted pursuant to NASDAQ Marketplace Rule 4350(i)(1)(A)(iv) and
under MiddleBrook's New Hire Stock Incentive Plan, which was
approved by MiddleBrook's Board of Directors on Sept. 26, 2008. The
options have a per share exercise price equal to the closing price
of MiddleBrook's common stock on the NASDAQ Global Market on the
business day immediately preceding the grant date, a ten-year term
and vesting over four years, with 25 percent of the options vesting
one year from the grant date and 1/48th of the options vesting
monthly thereafter. The options have a grant date of July 31,
2009.
About MiddleBrook
Pharmaceuticals:
MiddleBrook Pharmaceuticals, Inc. (Nasdaq: MBRK) is a
pharmaceutical company focused on developing and commercializing
anti-infective products that fulfill unmet medical needs.
MiddleBrook’s proprietary delivery technology—PULSYS—enables the
pulsatile delivery, or delivery in rapid bursts, of certain drugs.
MiddleBrook’s near-term corporate strategy includes improving
dosing regimens and/or reducing frequency of dosing to enhance
patient dosing convenience and compliance for antibiotics that have
been used and trusted by physicians and patients for decades.
MiddleBrook currently markets KEFLEX (cephalexin, USP), the
immediate-release brand of cephalexin, and MOXATAG–the first and
only FDA-approved once-daily amoxicillin. For more information
about MiddleBrook, please visit www.middlebrookpharma.com.
KEFLEX, KEFLEX 250 MG, KEFLEX 500MG, KEFLEX 750 MG, MiddleBrook,
MiddleBrook Pharmaceuticals (stylized), MiddleBrook
Pharmaceuticals, Inc., M1 (stylized), MOX-10, MOXAKIT, MOXATAG1
(stylized), MOXATAG, MOXATEN, MOXPAK, MOX-PAK and PULSYS are our
trademarks and have been registered in the U.S. Patent and
Trademark Office or are the subject of pending U.S. trademarks
applications. Each of the other trademarks, tradenames, or service
marks appearing in this document belongs to the respective holder,
as used herein, except as otherwise indicated by the context.
References to “we,” “us,” “our,” ‘‘MiddleBrook,” or the “Company,”
refer to MiddleBrook Pharmaceuticals, Inc., and its
subsidiaries.
About MOXATAG:
MOXATAG (amoxicillin extended-release) Tablets, 775mg, is a
once-a-day extended-release formulation of amoxicillin for oral
administration consisting of three components: one
immediate-release component and two delayed-release components. The
three components of MOXATAG are combined in a specific ratio to
prolong the release of amoxicillin compared to immediate-release
amoxicillin. MOXATAG is intended to provide a lower treatment dose,
once-daily alternative to currently approved penicillin and
amoxicillin regimens for the treatment of adults and pediatric
patients 12 years and older with tonsillitis and/or pharyngitis.
For more information about MOXATAG, please visit MOXATAG.com.
About KEFLEX:
KEFLEX (cephalexin, USP) Capsules, is MiddleBrook’s
immediate-release first-generation cephalosporin antibiotic. KEFLEX
has been shown to be active against strains of both gram- positive
and gram- negative aerobes in vitro and in clinical infections.
KEFLEX is indicated for treatment of the following infections:
respiratory tract infections, otitis media, skin and skin structure
infections, bone infections, and genitourinary tract infections.
More information on KEFLEX and prescribing information are
available at KEFLEX.com.
FORWARD-LOOKING
STATEMENTS
Some of the statements contained in this press release contain
forward-looking statements within the meaning of the Securities
Exchange Act of 1934 and the Securities Act of 1933, such as
statements about MiddleBrook’s future financial performance, growth
prospects and need for additional capital, the success of the
commercialization of MOXATAG and its market position, and the
status of the KEFLEX PULSYS Phase III study. In some cases,
forward-looking statements are identified by words such as
“believe,” “anticipate,” “expect,” “intend,” “plan,” “potential,”
“estimate,” “will,” “may,” “predict,” “should,” “could,” “would”
and similar expressions. Such forward-looking statements reflect
MiddleBrook’s current plans, beliefs, estimates and views and
involve a number of known and unknown risks, uncertainties and
other factors that may cause actual results to differ materially
from those expressed or implied by such forward-looking statements.
These factors include, but are not limited to, the failure to
successfully commercialize MOXATAG or a decline in sales of KEFLEX
750 mg, MiddleBrook’s ability to meet anticipated operating needs
with revenues, existing cash and the revolving line of credit or to
obtain additional financing, further decline in market conditions,
MiddleBrook’s ability to manage expenses, the FDA’s disagreement
with a revised study design, and other risks identified in the
sections titled “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” and “Risk Factors” in
MiddleBrook’s Annual Report on Form 10-K for the year ended
December 31, 2008 and in similar disclosures made by us from time
to time in our other filings with the Securities and Exchange
Commission. You should not place undue reliance on these
forward-looking statements, which speak only as of the date of this
press release. MiddleBrook undertakes no obligation to update
publicly or review any of the forward-looking statements made in
this press release, whether as a result of new information, future
developments or otherwise.
MIDDLEBROOK PHARMACEUTICALS, INC CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except
for Per Share amounts) Three Months Ended June
30, Six Months Ended June 30, 2009
2008 2009 2008 (Unaudited)
(Unaudited) Product sales $ 2,148 $ 2,522 $
11,117 $ 4,916 Costs and expenses: Cost of
product sales 279 374 1,036 996 Research and development 1,525
3,627 3,384 7,355 Selling, general and administrative 20,022
3,937 36,493 8,690
Total costs and expenses 21,826 7,938
40,913 17,041 Loss from
operations (19,678 ) (5,416 ) (29,796 ) (12,125 ) Interest income
75 90 330 215 Interest expense (41 ) — (52 ) — Warrant expense —
1,680 — (5,760 ) Other income (expense) 49 2
49 (17 ) Loss before income
taxes $ (19,595 ) $ (3,644 ) $ (29,469 ) $ (17,687 ) Income taxes
(10 ) — 122 —
Net loss $ (19,585 ) $ (3,644 ) $ (29,591 ) $ (17,687 ) Loss
(gain) attributable to noncontrolling interest —
(63 ) — 180 Net loss
attributable to MiddleBrook Pharmaceuticals $ (19,585 ) $ (3,707 )
$ (29,591 ) $ (17,507 ) Basic and diluted net loss per share
attributable to MiddleBrook Pharmaceuticals common stockholders $
(0.23 ) $ (0.07 ) $ (0.34 ) $ (0.32 ) Shares used in
calculation of basic and diluted net loss per share 86,482
56,025 86,459 54,660
MIDDLEBROOK PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands,
except Par Values) June 30, 2009 December 31,
2008 (Unaudited) ASSETS Current assets: Cash and
cash equivalents $ 39,405 $ 30,520 Marketable securities 5,142
44,242 Accounts receivable, net of allowances of $426 and $379 613
426 Inventories, net 2,223 335 Other current assets 3,899
2,638 Total current assets 51,282
78,161 Property and equipment, net 7,997 4,192 Other noncurrent
assets 2,512 1,395 Intangible assets, net 10,953
11,445 Total assets $ 72,744 $ 95,193
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities: Accounts payable $ 1,536 $ 2,993 Other current
liabilities 10,794 6,141 Total
current liabilities 12,330 9,134 Deferred contract revenue 11,625
11,625 Other long-term liabilities 4,837 2,503
Total liabilities 28,792 23,262
Stockholders’ equity: Preferred stock, $0.01
par value; 25,000 shares authorized, no shares issued or
outstanding at June 30, 2009 and December 31, 2008 — — Common
stock, $0.01 par value; 225,000 shares authorized, 86,508 and
86,433 shares issued and outstanding at June 30, 2009 and December
31, 2008, respectively 865 864 Capital in excess of par value
309,510 307,705 Accumulated deficit (266,506 ) (236,914 )
Accumulated other comprehensive income 83 276
Total stockholders’ equity 43,952
71,931 Total liabilities and stockholders’
equity $ 72,744 $ 95,193
MIDDLEBROOK
PHARMACEUTICALS, INC. CONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS (in thousands) Six
Months Ended June 30, 2009 2008
(Unaudited) Cash flows from operating activities: Net loss $
(29,591 ) $ (17,687 ) Adjustments to reconcile net loss to net cash
used in operating activities: Depreciation and amortization 1,664
1,842 Warrant expense — 5,760 Stock-based compensation 1,735 792
Deferred rent and credit on lease concession (3 ) (187 )
Amortization of premium (discounts) on marketable securities (26 )
(8 ) Loss on disposal of fixed assets and existing facility 966 17
Noncash tax expense 122 — Changes in: Accounts receivable (187 )
(16 ) Inventories (1,888 ) 232 Other current assets (1,381 ) (819 )
Deposits and other assets (117 ) 63 Accounts payable (1,457 ) (191
) Other liabilities 1,809 (269 ) Net
cash used in operating activities (28,354 ) (10,471 )
Cash flows from investing activities: Purchases of
marketable securities (5,206 ) (2,364 ) Sales and maturities of
marketable securities 44,110 — Purchases of property and equipment
(40 ) — Proceeds from sale of property and equipment — 332 Change
in restricted cash (1,000 ) — Net cash
provided by/(used in) investing activities 37,864
(2,032 ) Cash flows from financing activities:
Principal payments on capital lease obligations (696 ) — Proceeds
from private placement of common stock, net of issue costs — 19,915
Proceeds from exercise of common stock options 71 726 Proceeds from
exercise of common stock warrants — 164
Net cash (used in)/provided by financing activities
(625 ) 20,805 Net increase in cash and cash
equivalents 8,885 8,302 Cash and cash equivalents, beginning of
period 30,520 1,952 Cash and
cash equivalents, end of period $ 39,405 $ 10,254
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