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BioDelivery Sciences Provides Business Review And Update In Conjunction With Filing Of Second Quarter 2013 Financials

RALEIGH, N.C., Aug. 9, 2013 /PRNewswire/ -- BioDelivery Sciences International, Inc. (NASDAQ: BDSI) announced that it has filed its Quarterly Report on Form 10-Q for the quarter ended June 30, 2013, with the U.S. Securities and Exchange Commission and, in connection therewith, is providing a review of BDSI's recent achievements and an update on business operations and upcoming milestones for 2013.

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Business Highlights

As recently announced, a significant milestone was achieved by BDSI with the submission of a New Drug Application (NDA) to the U.S. Food and Drug Administration (FDA) for BUNAVAIL (buprenorphine naloxone buccal film) for the maintenance treatment of opioid dependence.  Under the 505(b)(2) regulatory statute, the NDA for BUNAVAIL, which was submitted on July 31, 2013, will be subject to a ten month review.  If approved, BUNAVAIL will be the first buccal film dosage form containing buprenorphine for the treatment of opioid dependence that will compete with the market leader Suboxone, which achieved sales in excess of $1.5 billion in 2012 according to data from Wolters Kluwer.

BDSI also remains on track to report data, expected in early 2014, from two pivotal Phase 3 studies of BEMA Buprenorphine for the treatment of chronic pain, a product with peak U.S. sales potential of $500 million.  These trials, one in opioid naive and the other in opioid experienced patients, are being conducted along with BDSI's partner, Endo Health Solutions.  Both trials are expected to complete in late 2013 or early 2014, and with database lock for each trial, BDSI expects milestone payments from Endo which, along with a milestone payment for NDA filing, total an aggregate of $30 million to BDSI.   

In addition to the advancement of BDSI's two BEMA products containing buprenorphine, BDSI strengthened its pain portfolio by entering into a worldwide license agreement with Arcion Therapeutics (Arcion) under which BDSI will develop and commercialize Clonidine Topical Gel (formerly ARC4558) for the treatment of painful diabetic neuropathy (PDN) and potentially other indications.  Nearly 26 million people in the U.S. have diabetes, according to the American Diabetes Association, and a substantial number of these people have neuropathy as manifest by impaired sensation and pain in the extremities, most commonly the feet.  Currently available oral treatments have been shown to be modestly effective in relieving symptoms and are limited by systemic side effects and drug interactions.  There are no topical products approved for the treatment of this painful condition.  BDSI estimates annual peak U.S. sales potential for this product to be in excess of $300 million and plans to initiate a Phase 2b clinical trial program for Clonidine Topical Gel for the treatment of painful diabetic neuropathy by the end of this year. 

In addition, BDSI announced that Adrian Hepner, MD, PhD, joined the company as Vice President of Clinical Research and Regulatory Affairs, and will initially concentrate his efforts on the clinical development of Clonidine Topical Gel for the treatment of PDN. 

During the second quarter of 2013, BDSI further added to its Board of Directors with the appointment of Thomas W. D'Alonzo.  Mr. D'Alonzo has held a number of high-level executive positions and board appointments at large and specialty pharmaceutical companies, including being current Chairman of Salix Pharmaceuticals, Inc. (NASDAQ:SLXP) and previously served on BDSI's Board of Directors from August 2006 through June 2008. 

Financial Highlights

At June 30, 2013, BDSI had $37.4 million in cash (not including proceeds received in early July 2013, from a $20.0 million senior secured loan from an affiliate of MidCap Financial), as compared to $63.2 million at December 31, 2012 and $43.0 million at June 30, 2012.  

Cash used in operations for the first six months of 2013 totaled $25.8 million, driven largely by the expense associated with the aforementioned Phase 3 pivotal trials and completion of work on BUNAVAIL. 

During the six months ended June 30, 2012, BDSI received $45.0 million in milestone payments in connection with the Endo license, of which $30.7 million was recognized as revenue. Cash flow contributed to operations in the prior year's first six months was $33 million.

Research and development costs were $12.8 million in the second quarter of 2013, compared to a corresponding $6.5 million in the second quarter of 2012.  For the six month periods ended June 30, 2013 and 2012, research and development costs totaled $24.8 million and $11.3 million, respectively.  The increase in research and development expenses in 2013 compared to 2012 can be attributed to the two pivotal pain trials and one safety trial underway pursuant to BDSI's collaboration with Endo for the BEMA Buprenorphine chronic pain program. Also contributing to the first half 2013 increase was the near completion of the BUNAVAIL program for the treatment of opioid dependence and compilation of its NDA as well as $2.1 million of in-process research and development (paid in common stock) associated with the aforementioned license agreement with Arcion.  The two Phase 3 pivotal trials for BEMA Buprenorphine for chronic pain are scheduled to complete later this year or early 2014, as will final development work associated with the completion of the BUNAVAIL NDA. As such, R&D spending is expected to be significantly reduced starting in the fourth quarter of 2013 as these two programs wind down. 

Including the recently closed MidCap loan and the addition of the anticipated Endo database lock milestones, BDSI believes that it has sufficient resources to fund intended operations through the end of 2014. 

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