Pharming posts wider Q3 net loss; says Rhucin approval process on track UPDATE

Pharming posts wider Q3 net loss; says Rhucin approval process on track UPDATE

	Published : Fri, 19 Oct 2007 08:28 By : Agencies Print this Story

(Updating with CEO comments, additional details on results, bond issue, financing)

AMSTERDAM (Thomson Financial) - Pharming Group NV presented a wider net loss for the third quarter of 2007 this morning, while saying that the European approval process for its lead product Rhucin is on schedule and announcing that it has raised 70 mln eur through the placement of convertible bonds.

The company posted a net loss of 6.4 mln eur for the quarter, compared to 4.4 mln eur in the same period a year earlier and analyst expectations for a net loss of 6.0-6.1 mln.

Pharming also said its cash position at the end of the quarter was 14.1 mln eur compared to 19.1 mln at the end of the second quarter and reported revenues of 0.6 mln eur for the first 9 months of 2007 compared to 0.1 mln in the same period a year earlier, largely due to subsidies and grants that are mostly related to Pharming's DNage unit.

Costs were reported at 6.5 mln eur for the third quarter, compared to 6.0 mln in the second. Pharming said total costs for the first nine months of 2007 were 17.2 mln, versus 12.3 mln for the same period in 2006. The company said costs increased because of 'intensified efforts' in the clinical development of Rhucin in the US and activities related to the European approval process for the same product. In addition, there were increased research and development costs for Pharming's recombinant human fibrinogen product and DNage products.

The company provided a recap of progress with its pipeline, saying the approval process at the European Medicines Evaluation Authority (EMEA) for the use of Rhucin to treat a condition called hereditary angioedema is going according to schedule and that it still expects to hear the EMEA's opinion by the end of the year.

Phase III trials of Rhucin are ongoing in the US, and Pharming said today it expects to complete those trials in the fourth quarter, after which it will submit regulatory filings 'as soon as possible'.

Pharming is also moving forward with plans to start clinical trials for the use of Rhucin for another indication having to do with organ transplantation by the end of the year.

Commenting on its recombinant human fibrinogen product that recently received orphan drug status in the US - a designation that allows for a quicker approval process and temporary market exclusivity - Pharming said in addition to moving towards bringing the product to market, it is also pursuing partnerships to develop fibrinogen-based medical device applications.

The company also said its DNage subsidiary 'continued to make excellent progress' in its research programmes and is preparing its first clinical studies in the field of ageing diseases, set to start in 2008.

CEO Francis J Pinto said in a press release that the company spent the third quarter focusing on 'getting our lead product to market as soon as possible, while maintaining a low cash-burn rate'.

He added that 'we have formed a solid basis for the registration of Rhucin'.

The CEO said Pharming also focused on strengthening its cash position, referring to this morning's announcement that the company has raised 70 mln eur by issuing senior unsecured convertible bonds that are due in 2012.

Pharming said the bonds, which have a coupon of 6.875 pct per annum and a conversion price of 4.40 eur, have only been offered to institutional investors and an application will be made to have the bonds listed on the Luxembourg Stock Exchange.

The company also announced that it is finalising negotiations with Paul Capital Healthcare towards a restructuring of their financing agreement that Pharming said will be funded with some of the bond issue proceeds.

Pharming said that under the proposed agreement, it would repay Paul Capital roughly 9 mln eur before the end of 2007 and pay an additional 11 mln eur in the first quarter of 2008.

These payments would conclude the financing arrangement, but Pharming said Paul Capital will remain a shareholder while Paul Capital executive Dr Ken MacLeod will remain on Pharming's supervisory board.

Dave van Ginhoven, dave.vanginhoven@thomson.com

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