Palatin Technologies, Inc. (PTN)
F3Q10 (Qtr End 03/31/10) Earnings Call Transcript
May 13, 2010 11:30 am ET
Carl Spana – President and CEO
Steve Wills – CFO and EVP, Operations
Trevor Hallam – EVP, Research & Development
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Good morning, ladies and gentlemen, and welcome to the Palatin Technologies third quarter fiscal year 2010 conference call. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session, and instructions for the question-and-answer session will be given at the end of the company's remarks. As a reminder, this call is being recorded.
Before we begin our remarks, I would like to remind you that statements made by Palatin that are not historical facts may be forward-looking statements. These statements are based on assumptions that may or may not prove to be accurate and actual results could differ materially from those anticipated due to a variety of risks and uncertainties discussed in the company's most recent filings with the Securities and Exchange Commission. Please consider such risks and uncertainties carefully in evaluating these forward-looking statements and Palatin's prospects.
Now I would like to introduce your host for today's call, Dr. Carl Spana, President and Chief Executive Officer of Palatin Technologies.
Thank you. Good morning, ladies and gentlemen, and welcome to the Palatin conference call. I’m Carl Spana, President and CEO of Palatin Technologies. With me today is Steve Wills, Palatin's Executive Vice President of Operations and Chief Financial Officer, and Dr. Trevor Hallam, Palatin's Executive Vice President of Research and Development.
Today Mr. Wills will take you through the financial summary for the quarter. That will be followed by Dr. Hallam who will go through our research and development programs and update you on the progress we have made there. I will finish with a summary and overview, and then we will open it up to questions.
So to start off our call, I’m going to hand it over to Mr. Wills who will go through the financial summary.
Thank you, Carl. And good morning, everyone. For the quarter ended March 31, 2010, which is the third quarter of our fiscal year, Palatin reported a net loss of $2 million or $0.02 per share compared to a net income of $0.1 million or $0.00 per share for the same period in 2009.
Total revenues in the quarter ended March 31, 2010 were $2.6 million compared to $5.2 million for the same period in 2009. The net loss for the quarter ended March 31, 2010 compared to the net income for the quarter ended March 31, 2009 was primarily attributable to a decrease in the recognition of revenue under our agreements with AstraZeneca.
Regarding costs and expenses, total operating expenses for the quarter ended March 31, 2010 amounted to $4.6 million compared to $5.1 million for the comparable quarter of 2009. Included as a component of operating expenses were non-cash, share-based expenses of $0.2 million and $0.3 million for the third quarter of fiscal year 2010 and 2009, respectively.
As of March 31, 2010, Palatin's cash, cash equivalents and investments totaled $10.2 million. This compared to $7.8 million as of June 30, 2009. The increase in cash, cash equivalents, and investments is primarily the net result of the receipt of $5 million in milestone payments from AstraZeneca related to the September 2009 amendment to the license and collaboration agreement, plus net proceeds of approximately $5.2 million from the sale of common stock and warrants in two registered direct offerings, one in August 2009 and one in March 2010, less the cash utilized to fund operations during the nine months ended March 31, 2010.
During the quarter ended March 31, 2010, we received $2.5 million in a milestone payment from AstraZeneca related to our September 2009 amendment to our collaboration agreement. And in March of 2010, we sold approximately 9.6 million units in a registered direct offering. For gross proceeds of $2.6 million, we netted $2.4 million.
Each unit consisted of one share of common stock, a Series A warrant exercisable for 0.33 shares of common stock at an exercise price of $0.30, and a Series B warrant exercisable for 0.33 shares of common stock at an exercise price of $0.27. The Series A warrant is exercisable 181 days from the date of issuance and expires three years thereafter. The Series B warrant is exercisable immediately upon issuance and expires 180 days from the date of issuance.
Additionally, during the quarter, we received a letter from the New York Stock Exchange, AMEX Exchange, determining that Palatin successfully resolved the continued listing deficiencies referenced in a December 2008 letter from the Exchange.
Thank you, Steve. Now Dr. Hallam will give you an update on our research and development programs.
Thanks, Carl, and good morning. Let me start as usual with our sexual dysfunction program. You will be aware that we have switched the routes of administration for the development of bremelanotide from intranasal dosing to subcutaneous. Over the last 18 months, Palatin has performed a number of preclinical studies and an additional clinical study with bremelanotide to further understand the relationship between bremelanotide plasma levels, its route of administration and blood pressure changes. We’ve made progress in demonstrating the subcutaneous injection of BMC has more consistent plasma levels and lower incidence of adverse events when observed with intranasal dosing.