MannKind (MNKD) Q1 2012 Earnings Call May 09, 2012 5:00 pm ET Executives Matthew J. Pfeffer - Chief Financial Officer, Principal Accounting Officer and Corporate Vice President Hakan S. Edstrom - President, Chief Operating Officer and Director Alfred E. Mann - Founder, Chairman and Chief Executive Officer Analysts Karen E. Jay - JP Morgan Chase & Co, Research Division Matthew W. Luchini - Piper Jaffray Companies, Research Division Tazeen Ahmad Presentation Operator
This conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, May 9, 2012. We undertake no obligation to revise or update any statements to reflect events or circumstances after the date of this call.For the first quarter of 2012, total operating expenses were $33.9 million compared to $30.6 million for the fourth quarter of 2011 and $38.1 million for the first quarter of 2011. R&D expenses were $24.2 million the first quarter of 2012 compared to $20.2 million for the fourth quarter of 2011 and $26.3 million for the first quarter of 2011. The decrease in R&D expenses for the first quarter of 2012 compared to the same quarter in 2011 was primarily due to the decreased salary-related costs, as a result of the February 2011 reduction in force. So over the increase in R&D expenses this quarter from last quarter was primarily due to an increase in clinical trial-related activities as Trials 171 and 175 were initiated in the third and fourth quarters of 2011, respectively. General and administrative expenses were $9.8 million for the first quarter of 2012 compared to $10.3 million for the fourth quarter of 2011 and $11.8 million for the first quarter of the previous year. General and administrative expenses remained relatively stable quarter-over-quarter. The decrease in salary-related costs, a result of the February 2011 RIF, accounted for the reduction from the prior year. The net loss applicable to common stockholders for the first quarter of 2012 was $38.2 million or $0.27% per share compared with a net loss of applicable to common stockholders of $41.5 million or $0.34 per share for first quarter of 2011. Our cash, cash equivalents and marketable securities at the end of the first quarter of 2012 totaled $56.7 million, which compares to $3.2 million at the end of 2011. Financial resources, including the remaining credit facility from Al, amounted to $95.5 million as of March 31, 2012.
Our cash burn increased from $20.1 million spend in the fourth quarter of 2011 to $33.1 million in the first quarter of 2012, reflecting the acceleration of our spending in 2012 as we enroll the planned clinical trials and approached commercialization. With our cash in hand and amount remaining available under the credit facility from Al, we believe we will be able to fund our operations into the fourth quarter of 2012. We continue to pursue additional funding opportunities to extend our cash runway, but I cannot comment further until we have something definitive to announce.With that, I would like to now turn the call over to Hakan. Hakan? Hakan S. Edstrom Thank you, Matt. Good afternoon. The focus of the organization during the first quarter certainly have been on the clinical trial programs, and all of our clinical trials are progressing satisfactorily. Our 2 trials, the 171 and 175, are well underway. We've opened all the planned sites in the U.S., Russia and Ukraine, and they are actively bringing in patients to the studies. As early in the month, we had screened approximately 75% of the planned patients in both trials. We have experienced higher-than-expected screen failure rates, that is patients that are evaluated but participation in the studies do not meet the protocol requirements for inclusion. To address this shortfall of patients, we have initiated more sites in the U.S. using our own monitoring staff. We've also contracted with a CRO to start up a number of additional sites. And in addition, to help our sites identify potential patients, we are working with a vendor who will identify and refer additional patients to our study sites. We expect these measures to help expedite the screening and enrollment process. As you will remember, we previously stated that we had hoped to complete enrollment in both the 171 and 175 clinical trials by the end of this quarter. While we have not yet given up on this timeline, it is foreseeable that the studies will not be fully enrolled until next quarter with last patient, last visit taking place sometime early in 2013. Read the rest of this transcript for free on seekingalpha.com