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Discovery Labs Reports Fourth Quarter Financial Results And Provides An Update On Key Pipeline Programs

WARRINGTON, Pa., March 22, 2011 (GLOBE NEWSWIRE) -- Discovery Laboratories, Inc. (Nasdaq:DSCO), a biotechnology company developing surfactant therapies for respiratory disease, today reports financial results for the fourth quarter ended December 31, 2010 and provides an update on key pipeline programs. The Company will host a conference call this morning at 10:00 AM EDT. The call-in number is 866-332-5218.

Selected financial information, discussed in greater detail below, include:
  • A net loss of $5.7 million for the fourth quarter of 2010. Excluding non-cash items related to depreciation, stock-based compensation and the change in fair value of certain outstanding warrants accounted for as derivative liabilities, the fourth quarter 2010 loss was $5.0 million.     
  • Net cash outflows of $4.4 million for the fourth quarter of 2010, consisting of $5.7 million of cash outflows partially offset by $1.3 million net proceeds from financing activities.     
  • The Company began 2011 with pro-forma cash of $32.8 million, consisting of $10.2 million as of December 31, 2011, $1.0 million of net proceeds from a January 2011 Committed Equity Financing Facility (CEFF) financing, and $21.6 million of net proceeds from a February 2011 public offering of the Company's securities.  For the first quarter of 2011, the Company projects cash outflow of $5.2 million before taking into account financing activities.

Selected updates on pipeline programs include:
  • Surfaxin ® (lucinactant) for the prevention of respiratory distress syndrome (RDS) in premature infants – the Company is conducting a comprehensive preclinical program to validate its optimized biological activity test (BAT), a key remaining issue that must be addressed to potentially gain U.S. Food and Drug Administration (FDA) marketing approval for Surfaxin in the United States.  The Company has had several interactions with the FDA intended to ensure that the comprehensive preclinical program would satisfy the FDA, and in January 2011, announced that the FDA had directed the Company to increase the sample size of a specific data set by testing additional Surfaxin batches. To comply with the FDA's suggestion, the Company has successfully manufactured seven Surfaxin batches and plans to manufacture three additional Surfaxin batches for the comprehensive preclinical program. The Company continues to believe that it will be in a position to file a Surfaxin Complete Response in the third quarter of 2011, which could lead to potential approval of Surfaxin in the first quarter of 2012.     
  • Surfaxin LS TM (lyophilized lucinactant) for neonatal RDS – the Company  continues to advance this program and plans in 2011 to establish a commercial-scale manufacturing capability at a cGMP-compliant contract manufacturer with expertise in lyophilized formulations and to seek regulatory guidance from the FDA and the European Medicines Agency (EMA) for the planned development program.     
  • Aerosurf ® (aerosolized lucinactant) for neonatal RDS – the Company continues to advance this program and plans in 2011 to finalize the clinical and potential commercial design of its capillary aerosolization generator, finalize the clinical and potential commercial design for its novel disposable patient interface intended to increase the efficiency of pulmonary aerosol delivery, and to seek regulatory guidance from the FDA and EMA for the planned clinical development program.

W. Thomas Amick, Chairman of the Board and Chief Executive Officer of Discovery Labs commented, "We have made considerable progress in our comprehensive preclinical program intended to gain FDA approval for Surfaxin, while prudently advancing our Surfaxin LS and Aerosurf programs. We have also recently concluded a number of key corporate initiatives that we believe fundamentally strengthens our Company and provides sufficient capital to take us through the potential FDA approval of Surfaxin, which we believe could occur in the first quarter 2012."

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