ZIOPHARM Oncology reports fourth quarter net income of $1.0M against loss last year

ZIOPHARM Oncology, Inc. (Nasdaq: ZIOP), a biopharmaceutical company that is seeking to develop and commercialize a diverse, risk sensitive portfolio of in-licensed cancer drugs addressing unmet medical needs, announced today its financial results for the fourth quarter and full year 2009, and the filing of its Annual Report on Form 10-K with the Securities and Exchange Commission. Summary financials for the fourth quarter and for the year are attached.

The Company reported net income of $1.0 million, or $0.03 per share for the quarter ended December 31, 2009, compared to a net loss of 4.6 million, or $(0.21) per share, in the fourth quarter of 2008. Without the recognition of a non-cash gain of $5.0 million attributable to the change in liability-classified warrants, there was a net loss of $4.0 million, or $(0.14) per share, for the fourth quarter ended December 31, 2009. Net loss for the year was $7.6 million, or $(0.33) per share, compared to $25.2 million, or $(1.19) per share, for the full year 2008. Total operating expenses for the fourth quarter decreased by $536 thousand compared to the fourth quarter of 2008. The significant decrease in operating expenses is attributable to a continued focus on resources as well as tight management of operating expenses. Total operating expense for the year was $12.1 million, compared to $25.6 million for 2008, or a decrease of $13.5 million. The Company ended the December 2009 quarter with cash of approximately $48.8 million that, under current assumptions which are subject to change, is expected to support operations early into the first quarter of 2012.

During the fourth quarter, the Company completed an underwritten offering of its common stock and warrants resulting in net proceeds of approximately $45.3 million after paying offering expenses of approximately $2.8 million.

The Company’s clinical programs continued to progress in 2009 together with intense financial discipline. Our principal focus following recent completion of financing transactions in both the third and fourth quarters of 2009 remains the development of intravenous palifosfamide for the treatment of soft tissue sarcoma (“STS”). A randomized Phase II multicenter, parallel group, randomized study of palIfosfamide tris plus doxorubicin versus doxorubiCin in subjects with unresectAble or metastatic Soft tissue SarcOma (PICASSO) is ongoing in the front- and second-line setting of STS. The Company reported positive interim results from the PICASSO trial that were subsequently presented at the 2009 Connective Tissue Oncology Society’s (“CTOS”) annual meeting after enrollment in the trial was terminated early at 67 patients. Following U.S. Food and Drug Administration (“FDA”) and European Medicines Agency (“EMA”) protocol review, the Company expects to initiate a global registration trial in STS as early as the first half of 2010. The Company is also in dialogue with FDA related to intravenous Phase II darinaparsin (Zinapar^TM or ZIO-101) study results in lymphoma, and following an evaluation of various alternatives in light of the Company’s principal focus on palifosfamide development, it expects to initiate a planned registration and other trials for intravenous darinaparsin. A Phase I trial for an oral form of darinaparsin is in progress and early results were reported at ASCO in 2009. With respect to the Company’s third product candidate, indibulin (Zybulin^TM or ZIO-301), it expects a Phase I/II study in breast cancer involving a “mathematically modeled” administration schedule rigorously developed preclinically by Dr. Larry Norton, working with the Company, will initiate in the first half of 2010 at the Memorial Sloan Kettering Cancer Center.