2013 First Quarter Financial Results
Total revenues for the 2013 first quarter were $22.1 million compared with $22.0 million for the same prior year period. Total revenues for the 2013 first quarter consists entirely of royalty revenue of $22.1 million, compared with royalty revenue of $20.6 million for the same prior year period. Royalty revenue is earned pursuant to the license agreement entered into with MGI PHARMA (acquired by Eisai Corporation of North America in January 2008) during 2004, which granted MGI PHARMA exclusive rights to the development, manufacture, commercialization and distribution of Dacogen® (decitabine) for Injection. There was no development and license revenue reported during the 2013 first quarter compared with $1.4 million for the same prior year period.
Total operating expenses for the 2013 first quarter were $23.9 million, compared with $20.6 million for the same prior year period. The primary reasons for the increase in total operating expenses for the 2013 first quarter compared with the same prior year period are increased research and development costs associated with SGI-110 and AT13387, and an increase in stock-based compensation expense, partially offset by lower amortization of intangibles costs and a reduction in general and administrative expenses. The non-cash amortization of intangibles was $1.9 million for the 2013 first quarter compared with $2.2 million for the same prior year period. Stock-based compensation expense, a non-cash expense, was $1 million for the 2013 first quarter, compared with $765,000 for the same prior year period.
The Company reported net income for the 2013 first quarter of $488,000, or $0.01 per basic and diluted share, compared with net income of $4.2 million, or $0.05 per basic and $0.04 per diluted share, for the same prior year period. Included in the 2013 first quarter net income is a foreign currency translation loss of $1.3 million compared to $4,000 for the same prior year period. Also included in 2013 first quarter net income is an income tax benefit of $3.8 million compared with an income tax benefit of $2.8 million for the same prior year period. The income tax benefits for the current and prior year first quarters are primarily due to the recognition of tax benefits associated with the amortization of deferred tax liabilities resulting from the acquisition of Astex Therapeutics Limited in 2011, and foreign research and development tax credits related to our UK subsidiary.
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