Bradmer Pharmaceuticals Inc. ("Bradmer" or the "Company") today announced its 2009 third quarter financial results.
Operational Highlights
During the three-month and nine-month periods ended September 30, 2009, the Company continued its stated decisive actions arising from the strategic review of operations announced February 17, 2009. Pursuant to the strategic review, the Company closed its Phase III GLASS-ART Trial in March 2009 to further patient enrolment, as the completion of initial milestones was projected to fully exhaust the Company's cash resources, while capital market conditions restricted the ability to raise further capital at this time. The Company has continued to execute on its cash conservation plan in the third quarter with a further reduction of staff and clinical trial related expenses to the minimum level required to wind down the business while continuing to pursue license opportunities, alternative sources of non-dilutive funding and to explore all strategic options. The plan included a substantial issuer bid whereby the Company purchased for cancellation 7.5 million of its outstanding common shares, at a price of CDN$0.20 per share or approximately US$0.183 per share, on September 8, 2009 for proceeds paid to shareholders of $1,366,000.
Financial Results
Amounts in US dollars, unless specified otherwise, and results expressed in accordance with Canadian Generally Accepted Accounting Principles (Canadian GAAP).
For the three-month period ended September 30, 2009, Bradmer recorded a net loss of $722,000 or $0.06 per common share based on the weighted average outstanding shares of 11,832,537 during the period, compared to a net loss of $2,627,000 or $0.19 per common share for the three-month period ended September 30, 2008 based on the weighted average outstanding shares of 13,488,215. The decreased loss in 2009 was primarily related to the decision to terminate enrolment in the clinical trial and suspend manufacturing and other operating activities. During the third quarter of 2009, the Company continued its focus on cost reduction opportunities in all areas of the business, particularly staff reductions, in response to the termination of the clinical trial and the existing macro economic conditions.
Research and development expenses for the three-month period ended September 30, 2009, totaled $44,000, compared to $1,908,000 in the corresponding period in 2008. The decrease was due to the absence of clinical trial and manufacturing activity in the period after the decision in March 2009 to terminate clinical trial enrolment.
The Bradmer patent portfolio is based on technology, which is the subject of an exclusive license from Duke University. The Company is responsible for patent prosecution and maintenance. The portfolio comprised 31 issued patents and 28 pending patent applications in the United States and major foreign jurisdictions. Several patents have been either returned or abandoned under the terms of the license agreement that do not affect the protection around the key assets. During the second quarter of 2009, the Company made a decision to abandon or return 20 patents to Duke University and to take a write-down of $200,000 for the value of patents abandoned. In the third quarter of 2009, an additional 13 pending applications in non-critical territories or fields were abandoned or returned to Duke, leaving 26 issued and pending patents remaining. Given the uncertainty surrounding the future of the Company, the remaining net book value of the patent rights of $473,000 has been written off to reflect the impairment in value of these patents.
General and administrative expenses for the three-month period ended September 30, 2009, were $187,000, compared to $768,000 in the same period in 2008 due to the decision to reduce expenses throughout all departments in the Company. Compensation costs amounted to $214,000 in 2009 compared with $316,000 in 2008. The portion of stock-based compensation included in general and administrative expenses was a recovery of $128,000 for the quarter due to the forfeiture of unvested options, as compared to an expense of $84,000 for the third quarter of 2008. The recovery of prior periods' stock-based compensation expense arose because of the need to reduce the number of options outstanding to meet the limitation that the number of options be no more than 12.5% of the number of shares outstanding. Stock-based compensation included in research and development expenses was a recovery of $10,000 during the three-month period ended September 30, 2009 compared with an expense of $29,000 in the comparable period for 2008.