Zonagen Reports First Quarter 2005 Financial Results and Announces 2005 Annual Meeting of Stockholders
09 May 2005 - 8:00PM
Business Wire
Zonagen, Inc. (Nasdaq:ZONA)(PCX:ZONA) today provided an overview of
the status of its Progenta(TM) and Androxal(TM) clinical programs,
reported first quarter financial results for the three-month period
ended March 31, 2005, and announced its 2005 Annual Meeting of
Stockholders to be held in New York City on June 21, 2005. "We are
emerging from our first quarter with a strong clinical pipeline and
are preparing to initiate three clinical trials in 2005. These
trials include a U.S. Phase III trial of Androxal for male
testosterone deficiency, a U.S. clinical trial of Progenta for
uterine fibroids and a European Phase II trial of Progenta for
endometriosis," said Joseph Podolski, President and CEO of Zonagen,
Inc. "We continue to operate in a streamlined, efficient manner as
a near-virtual company to provide the most value to our
stockholders." Zonagen has been informed by the FDA that it has
agreed to review the Company's Androxal Phase III pivotal trial
under a Special Protocol Assessment ("SPA") pending the FDA's
review of the protocol. The Company's goal is to commence a U.S.
Phase III study by year end 2005 and have initial three-month study
data by the end of the first half of 2006. The Company's recently
completed European Phase Ib clinical study of Progenta, which
studied the drug's safety and efficacy when administered for three
months to women diagnosed with uterine fibroids, indicated that
Progenta may be safe and have the potential to significantly reduce
fibroid size. The Company believes it has sufficient data from this
trial to adequately select dose for an advanced Phase II U.S.
trial. Zonagen has scheduled a pre-IND meeting with the FDA for May
20, 2005 and pending those discussions, the Company's goal is to
commence this Phase II trial by year end 2005. The Company hopes
that this Phase II trial may be the first pivotal trial of two
required pivotal trials. Initial three-month study data from this
trial is expected by the end of the first half of 2006. Zonagen
also intends to conduct a European Phase II clinical study of
Progenta for the treatment of endometriosis. The Company believes
it will begin that study by year end 2005 and have initial study
data by the end of the first half of 2006. Financial Results Total
revenues and other income for the three-month period ended March
31, 2005 decreased to $112,000 as compared with $125,000 for the
same period in the prior year. Research and development grant
revenue for the three-month period ended March 31, 2005 were $4,000
as compared to $64,000 for the same period in the prior year. This
grant revenue relates to a $836,441 Phase II Small Business
Innovative Research ("SBIR") grant that was awarded to the Company
in 2002 for the development of Progenta as an oral treatment for
endometriosis. This SBIR grant has come to its anticipated
conclusion and is essentially depleted. Interest income increased
315% to $108,000 for the three-month period ended March 31, 2005,
as compared to $26,000 for the same period in the prior year. This
increase is primarily due to the increase in marketable securities
as a result of the Company completing its follow-on public offering
on February 1, 2005 in which it received approximately $18.2
million in net proceeds. Research and development ("R&D")
expenses include contracted research, regulatory affairs activities
and general research and development expenses. R&D expenses
increased 159% to $1.2 million for the three-month period ended
March 31, 2005 as compared to $477,000 for the same period in the
prior year. The increase in R&D expenses for the three-month
period ended March 31, 2005 as compared to the same period in the
prior year is primarily due to an increase of $499,000 and $292,000
related to the Company's clinical development programs for Progenta
and Androxal, respectively, partially offset by a decrease of
$60,000 in costs associated with the Company's SBIR grant funded
R&D. General and administrative expenses remained relatively
constant at $431,000 for the three-month period ended March 31,
2005, as compared to $434,000 for the same period in the prior
year. The slight decrease in expenses for the three-month period
ended March 31, 2005 is primarily due to a decrease in directors'
and officers' insurance expense and professional services,
partially offset by an increase in directors' expense. Net loss for
the three-month period ended March 31, 2005 was ($1,555,000) or
($0.19) per share as compared to a net loss of ($786,000) or
($0.14) per share for the same period in the prior year. The
increase in loss per share for the three-month period ended March
31, 2005 was primarily due to an increase in clinical research
activities relating to the Company's two products, Progenta and
Androxal. The Company had cash, cash equivalents and marketable
securities of approximately $23.2 million at March 31, 2005 as
compared to $5.5 million at December 31, 2004 and had 10,079,601
shares of common stock outstanding on March 31, 2005. 2005 Annual
Meeting of Stockholders The 2005 Annual Meeting of Stockholders of
Zonagen, Inc. will be held on Tuesday, June 21, 2005, at 5:00 p.m.,
Eastern Daylight Time, at the New York Marriott East Side Hotel,
525 Lexington Avenue, New York, New York. The Company will mail a
Notice of the Annual Meeting, Proxy Statement and form of Proxy to
stockholders of record for the meeting about one month prior to the
meeting. Zonagen, Inc. is engaged in the development of
pharmaceutical products that address diseases and conditions
associated with the treatment of hormonal and reproductive system
disorders. A copy of this press release may be obtained via
facsimile by dialing 1-888-329-0920 or via the internet by
accessing www.zonagen.com. Any statements that are not historical
facts contained in this release are forward-looking statements that
involve risks and uncertainties, including Zonagen's ability to
have success in the clinical development of its technologies,
Zonagen's ability to raise additional capital on acceptable terms
or at all, Zonagen's ability to have success in meeting
governmental regulations and the costs and time required to meet
such regulatory requirements, manufacturing uncertainties related
to Progenta(TM), uncertainty relating to Zonagen's patent portfolio
and such other risks which are identified in Zonagen's Annual
Report on Form 10-K for the year ended December 31, 2004. The Form
10-K is available at the Company's web site at www.zonagen.com, at
the SEC's web site at www.sec.gov or is available by request made
to Zonagen's Corporate Secretary. Zonagen disclaims any intention
or obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.
-0- *T ZONAGEN, INC. AND SUBSIDIARY (A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands except per
share amounts) Three Months Ended -------------------------- March
31, 2005 2004 ------------- ------------ (Unaudited) (Unaudited)
Revenues Research and development grants $4 $64 Interest income 108
26 Other - 35 ------------- ------------ Total revenues 112 125
Expenses Research and development 1,236 477 General and
administrative 431 434 ------------- ------------ Total expenses
1,667 911 ------------- ------------ Net loss $(1,555) $(786)
============= ============ Net loss per share $(0.19) $(0.14)
============= ============ Shares used in loss per share
calculation: Basic 8,326 5,492 Diluted 8,326 5,492 CONSOLIDATED
BALANCE SHEETS March 31, December 31, 2005 2004 -------------
------------ (Unaudited) Cash and cash equivalents $1,620 $736
Marketable securities 21,541 4,800 Other currents assets 238 34
Fixed assets (net) 20 18 Other assets (net) 438 1,018 -------------
------------ Total assets $23,857 $6,606 ============= ============
Accounts payable and accrued expenses $1,152 $614 Stockholders'
equity 22,705 5,992 ------------- ------------ Total liabilities
and stockholders' equity $23,857 $6,606 ============= ============
*T
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