NPS Pharmaceuticals (NPSP) reported company financial results for the quarter ended September 30, 2007 and also provided an update on company milestones and financial guidance.
The company announced that they have:
1. Completed the Phase 3 study of GATTEX in short bowel syndrome
2. Retired substantially all of its 2008 convertible debt
3. Reduced cash burn guidance to $70-$80 million from previous guidance of $80-$90 million
4. Positioned the company to burn between $35 and $45 million in 2008
5. Explored the development of PREOS and GATTEX in at least one new indication for each program.
Dr. Tony Coles, president and CEO of NPS, commented, “Our team’s diligent efforts this year have strengthened our balance sheet and increased our operating flexibility to drive our late-stage products forward. By monetizing our non-core assets and addressing our debt, we are in a much stronger position to maximize the value of GATTEX and PREOS for patients and shareholders. As a result of the improvements in our financial profile, we are revising our 2007 guidance to reflect the transformation our business has undergone this year.”
NPS reported net income of $14.1 million for the third quarter of 2007 and ended the quarter with $302.2 million in cash and marketable securities. During the third quarter the following financial transactions were executed:
1. NPS granted Nycomed the rights to develop and market GATTEX outside North America, which generated an up-front payment of $10 million
2. NPS sold $11 million of Preotact® bulk drug supply to Nycomed
3. The Preotact royalty entitlement was sold to Drug Royalty LP 3 for an up-front payment of $50 million
4. $50 million of convertible notes were issued to Visium Asset Management; $100 million in Sensipar® royalty-backed notes were issued
5. $20.2 million of 3% Convertible Notes were repurchased for $19.0 million
NPS projects that its 2008 cash burn will be $35-45 million, as indicated in previous guidance. With the reduced cash burn and revised cash balance, NPS should have sufficient cash to fund operations for the next two to three years.
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