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Gentium Reports Third Quarter 2010 Financial Results

  • Profitability achieved for the second consecutive quarter.
  • Cash flow positive for the fourth consecutive quarter.
  • Total revenues and net income for the nine-month period ended September 30, 2010 were EUR 18.44 (US$25.17) million and EUR 3.44 (US$4.69) million, respectively.

VILLA GUARDIA (COMO), Italy, Nov. 8, 2010 (GLOBE NEWSWIRE) -- Gentium S.p.A. (Nasdaq:GENT) (the "Company") today reported financial results for the quarter ended September 30, 2010. The Company reports its financial condition and operating results using U.S. Generally Accepted Accounting Principles (GAAP). The Company's financial statements are prepared using the Euro as its functional currency. On September 30, 2010, EUR 1.00 = $1.3648.

"We are pleased to report that for the second consecutive quarter the Company achieved profitability, posting net income of EUR 3.44 million (US$4.69 million) for the nine-month period ended September 30, 2010," stated Salvatore Calabrese, Senior Vice President, Finance of Gentium S.p.A. "The Company remains cash flow positive for the fourth consecutive quarter and has strengthened its cash position. We remain on target with our revised projected revenues of EUR 23-25 million for 2010."

"We are delighted that now more than 200 clinics worldwide are using the expanded access programs. In the previous quarters, we have seen a marked increase in the prophylactic use of Defibrotide for prevention of VOD, constituting some 25-30% of Defibrotide use in ex-U.S. clinics," stated Dr. Khalid Islam, Chairman and Chief Executive Officer of Gentium S.p.A. "We remain on track for the completion of the on-going preclinical and clinical studies and aim to file for marketing authorization with U.S. and European regulatory authorities by the end of the second quarter in 2011."

Dr. Islam also provided an update on activities following the close of the quarter, "In the last month the company was present at two major conferences, International Society of Hematology (ISH) and Asia Pacific Blood and Marrow Transplant (APBMT). Results presented at the ISH meeting in Jerusalem demonstrated that prophylactic use of Defibrotide also significantly reduced the incidence (47% versus 65%; P=0.005) and severity (P=0.003) of acute graft-versus-host disease or acute GvHD by Day +100 in the allogeneic transplant patients. Acute GvHD is a frequent post-transplant complication and is associated with high morbidity and mortality. At the APBMT conference in Phuket, the Company collected information from clinicians on current trends in the Asia-Pacific region and key opinion leaders highlighted the results of the clinical trials and compassionate use programs with Defibrotide in VOD/GvHD at a symposium entitled " Defibrotide for the Prevention and Treatment of endothelial complications following Stem Cell Transplantation."

Financial Highlights

For the nine-months ended September 30, 2010 compared with the prior year's period:
  • Total revenues increased 201% to EUR 18.44 million, compared with EUR 6.12 million.
  • Operating costs and expenses, which include restructuring charges of EUR 0.95 million, were EUR 14.83 million, compared with EUR 10.66 million.
  • Research and development expenses, which are included in operating costs and expenses, were EUR 4.63 million, compared with EUR 2.66 million. 2009 research and development expenses were net of EUR 0.76 million of government grants in the form of a tax credit, accrued as a reduction of expenses. Excluding such grants, 2009 research and development expenses would have been EUR 3.42 million.
  • Operating income/(loss) was EUR 3.62 million, compared with EUR (4.54) million.
  • Net income/(loss) was EUR 3.44 million, compared with EUR (4.48) million.
  • Basic and diluted net income/(loss) per share was EUR 0.23, compared with EUR (0.30) per share.

For the third quarter ended September 30, 2010 compared with the prior year's third quarter:
  • Total revenues were EUR 5.91 million, compared with EUR 2.50 million. Product sales for the three-month period ended September 30, 2010 increased 97% to EUR 4.85 million compared to EUR 2.46 million in the third quarter of 2009. Defibrotide net sales through named-patient and cost recovery programs were EUR 3.36 million, or 69% of total product sales, an increase of 142% compared to EUR 1.39 million for the same period in 2009. Sales of the Company's API amounted to 1.49 million, or 31% of total product sales, an increase of 39% compared to EUR 1.07 million for the same period in 2009.
  • Operating costs and expenses were EUR 4.36 million, compared with EUR 3.49 million.
  • Research and development expenses, which are included in operating costs and expenses, were EUR 1.17 million, compared with EUR 0.85 million.
  • Operating income/(loss) was EUR 1.55 million, compared with EUR (0.99) million.
  • Net income/(loss) was EUR 1.12 million, compared with EUR (1.02) million.
  • Basic and diluted net income/(loss) per share was EUR 0.08, compared with EUR (0.07) per share.

Net cash generated by operating activities for the nine-month period ended September 30, 2010 was EUR 8.19 million compared to the net cash expenditure from operating activities of EUR 5.81 for the same period in 2009. Cash and cash equivalents were EUR 9.29 million as of September 30, 2010, compared to EUR 1.39 million as of December 31, 2009.

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