Astex Pharmaceuticals Reports 2012 Third Quarter Financial Results

Astex Pharmaceuticals Reports 2012 Third Quarter Financial Results

   Dacogen Approved in the European Union for the Treatment of Elderly AML

 Initiated HSP90 Inhibitor AT13387 Clinical Trials in Prostate & Lung Cancer
                                   Patients

              Initiated SGI-110 Clinical Trial in Ovarian Cancer

    Ended Quarter With Nearly $130 Million in Cash & Marketable Securities

DUBLIN, Calif., Oct. 30, 2012 (GLOBE NEWSWIRE) -- Astex Pharmaceuticals, Inc.
(Nasdaq:ASTX), today reported financial results for the third quarter ended
September 30, 2012. The Company reported a net loss for the 2012 third quarter
of $1.8 million, or $0.02 per basic and diluted share, compared with a net
loss of $1.1 million, or $0.01 per basic and diluted share, for the same prior
year period. The Company reported net income for the nine months ended
September 30, 2012 of $3.7 million, or $0.04 per basic and diluted share,
compared with a net income of $5.3 million, or $0.08 per basic and diluted
share, for the same prior year period.

Highlights of 2012 Third Quarter:

  o Dacogen^® (decitabine) for Injection was approved in the European Union
    (EU) for the treatment of adult patients (age 65 years and above) with
    newly diagnosed de novo or secondary Acute Myeloid Leukemia (AML). In
    October 2012, the Company earned $5 million upon first commercial sale of
    Dacogen in the EU.
  o Royalty revenue increased from $16.6 million in the prior year third
    quarter to $17.0 million in the current year third quarter.
  o Ended the 2012 third quarter with nearly $130 million in cash & marketable
    securities.
  o Revised 2012 financial guidance from a forecasted net loss of $5 million
    to net income of $4 million.
  o Initiated two Phase 2 clinical trials of the HSP90 inhibitor AT13387 in
    castration resistant prostate cancer patients, and in non-small cell lung
    cancer (NSCLC) patients with anaplastic lymphoma kinase positive (ALK+) or
    other crizotinib sensitive tumors.
  o Initiated Phase 2 clinical trial of SGI-110 in platinum-resistant ovarian
    cancer patients.
  o Initiated new epigenetics drug discovery collaboration with The Institute
    of Cancer Research and Cancer Research Technology Limited, as well as a
    five-year strategic drug discovery alliance with the UK's Cancer Research
    Technology Limited (CRT) and Newcastle University.

"Thanks to Eisai and Janssen, Dacogen is now sold and marketed in more than 35
countries around the world. Dacogen royalties received in the third quarter
helped to drive revenue and increase our cash and cash equivalents position,"
said James S.J. Manuso, Ph.D., chairman and chief executive officer.  "We
revised our operating guidance and now project a small profit for 2012. 
Before year-end, our prioritized products, AT13387 and SGI-110, will be in
four Phase 2 proof-of-concept clinical trials."

2012 Third Quarter Financial Results

Total revenues for the 2012 third quarter were $17.2 million compared with
$16.9 million for the same prior year period. Total revenues for the 2012
third quarter include royalty revenue of $17.0 million compared with $16.6
million for the same prior year period. Total revenues for the 2012 third
quarter also include development and license revenue of $199,000 compared with
$308,000 for the same prior year period.

Total operating expenses for the 2012 third quarter were $26.6 million,
compared with $20.1 million for the same prior year period. The primary
reasons for the increase in total operating expenses for the 2012 third
quarter compared with the same prior year period are the consolidation of
research and development and general and administrative costs related to the
acquisition of Astex Therapeutics Limited effective July 20, 2011, increased
research and development initiatives associated with SGI-110 and AT13387, an
increase in the amortization of intangible assets related to the acquisition,
and an impairment charge associated with the write down of an intangible
asset. The non-cash amortization of intangible assets was $1.9 million for the
2012 third quarter compared with $1.5 million for the same prior year
period. The non-cash impairment charge was $7.4 million for the 2012 third
quarter while there was no similar impairment charge for the same prior year
period. Stock-based compensation expense, a non-cash expense that is included
in operating expenses, was $885,000 for the 2012 third quarter, compared with
$858,000 for the same prior year period.

The Company reported a net loss for the 2012 third quarter of $1.8 million, or
$0.02 per basic and diluted share, compared with a net loss of $1.1 million,
or $0.01 per basic and diluted share, for the same prior year period. Included
in the 2012 third quarter net loss is a $2.6 million gain on sale of
investments related to the disposition of an equity position held in another
entity. In addition, the 2012 third quarter net loss also includes an income
tax benefit of $5.5 million compared with an income tax benefit of $2.4
million for the same prior year period. The income tax benefit for the current
and prior year third quarter is primarily due to the recognition of a tax
benefit associated with the amortization of deferred tax liabilities resulting
from the acquisition, a change in the UK tax rates, and foreign research and
development tax credits related to the UK subsidiary.

Financial Position

At September 30, 2012, the Company had $129.9 million in cash, cash
equivalents, and current and non-current marketable securities compared to
$120.8 million at June 30, 2012.

Operational Highlights

The Company announced that Janssen-Cilag International NV was notified that
the European Commission approved the marketing authorization for Dacogen for
the treatment of adult patients (age 65 years and above) with newly diagnosed
de novo or secondary AML, according to the World Health Organization
classification, who are not candidates for standard induction
chemotherapy. Dacogen was also granted a 10-year Orphan Drug designation for
the treatment of elderly AML. In early October, 2012, the Company announced
that a $5 million milestone was earned from Eisai Inc. for the first
commercial sale of Dacogen in the EU, which will be reflected as revenue
during the Company's 2012 fourth quarter.

The Company announced the initiation of three Phase 2 clinical trials,
including a study with HSP90 inhibitor, AT13387, in castration-resistant
prostate cancer patients, an AT13387 study in NSCLC patients with ALK+ or
other crizotinib sensitive tumors, and a study with the novel hypomethylator
SGI-110 in platinum-resistant ovarian cancer patients.

The Company announced that clinical development of amuvatinib (MP-470), a
multi-targeted tyrosine kinase inhibitor that inhibits the mutant forms of
c-Kit and PDGFR alpha and disrupts DNA repair, was discontinued. Amuvatinib
was being investigated in a Phase 2 study for the treatment of SCLC in
combination with Platinum Etoposide using a Simon 2-stage design.    Response
evaluation by RECIST criteria validated two partial responses in the 21
evaluable patients in the stage 1 segment of the Simon 2-stage designed trial
(9.5% Response Rate), which fell short of the targeted primary endpoint
response rate. No new safety issues were identified, and biological marker
studies are ongoing. There were several patients with prolonged stable
disease. The results will be presented at a future scientific meeting.

The Company, Cancer Research Technology Limited (CRT) and The Institute of
Cancer Research, London UK, initiated a collaboration to discover and develop
drug candidates against an undisclosed epigenetic target in a blood cancer
with a high unmet medical need. The collaboration combines the Company's
world-renowned fragment-based drug discovery platform and epigenetic drug
development experience with the expertise in blood cancer biology at The
Institute of Cancer Research (ICR) and the proven success in drug discovery at
the Cancer Research UK Cancer Therapeutics Unit at the ICR.

2012 (Revised) and 2013 Annual Financial Guidance

The annual financial guidance for 2012 and 2013 is presented in the table
below:

                                         Annual Financial Guidance (In $000's)
                                         2012               2013
                                                             
Revenues:                                                    
Royalty revenue                           $ 70,000           $ 60,000
Development & license revenue (a)         12,000             --
                                          82,000             60,000
Operating expenses (b):                                      
Research & development                    61,000             67,000
Amortization of intangibles and           15,500             8,000
impairment charge
General & administrative                  15,500             15,000
Gain on disposition of assets and sale    (1,300)            --
of products
                                          90,700             90,000
Loss from operations                      (8,700)            (30,000)
Other income (expense), net               2,200              --
Income tax benefit                        10,500             8,000
Net income (loss)                         $ 4,000            $(22,000)
                                                             
Net income (loss) per average share       $ 0.04             $ (0.23)
outstanding
Weighted average shares outstanding       93,000             94,000
                                                             
(a) Though the Company anticipates earning additional development and license
revenue
 from its partnered programs we do not provide guidance to such revenue due to
the
 general uncertainty around, and timing of, milestone achievements and
payments.
                                                             
(b) Includes total non-cash charges of approximately $20 million and $12
million for 2012
 and 2013, respectively.

Conference Call Information

Astex Pharmaceuticals will host a conference call to discuss the 2012 third
quarter financial results today at 1:30 p.m. PT / 4:30 p.m. ET. A live webcast
of the conference call is accessible via the investor relations section of the
Company's website at http://www.astx.com. A webcast replay of the conference
call will be available for 30 days.

About Astex Pharmaceuticals

Astex Pharmaceuticals is dedicated to the discovery and development of novel
small molecule therapeutics with a focus on oncology. The Company is
developing a proprietary pipeline of novel therapies and is creating de-risked
products for partnership with leading pharmaceutical companies. Astex
Pharmaceuticals developed Dacogen and receives significant royalties on global
sales.

The Astex Pharmaceuticals, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=12273

For more information about Astex Pharmaceuticals, Inc., please visit
http://www.astx.com.

Forward-Looking Statements

This press release contains "forward-looking" statements within the meaning of
Section 21A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, and is subject to the safe harbor
created thereby. Actual results could differ materially from those projected
in the forward-looking statements as a result of a number of risks and
uncertainties. These forward-looking statements include, but are not limited
to, statements regarding financial guidance, which include expectations
regarding royalty revenue, development and license revenue, research and
development expenses and general and administrative expenses, amortization of
intangibles and impairment charges, gains on dispositions of assets and sales
of products, estimates of net income or loss and anticipated tax benefits and
statements about expected losses or profitability; expectations regarding the
completion of drug candidate optimization and advancement of drug candidates
in the clinic; expectations regarding our clinical trials including the
production and timing of clinical data from these trials; expectations
regarding the potential growth of worldwide sales of Dacogen, expectations
regarding the ability of the Company to expand and develop our pipeline of
products in the years ahead; the Company's ability to develop the current and
future pipeline into commercially viable drugs; the expectations regarding our
clinical trials including the timing of clinical proof of concept data from
these trials; the sufficiency of our operating cash to fund our development
initiatives this year and thereafter; estimates regarding our total expected
shares outstanding; and expectations regarding Eisai's and Janssen's plans for
Dacogen since its approval in Europe. Important factors that could cause
actual results to differ materially from the expectations reflected in the
forward-looking statements include, but are not limited to: failure to achieve
the results included in the financial guidance; the ability of Eisai and
Janssen to generate global sales of Dacogen; the outcomes of the on-going
clinical trials; risks and uncertainties related to the achievement of
developmental milestones with respect to the compounds in development; the
research and development of SGI-110, AT13387, and other programs; the decision
by certain strategic partners whether or not to license and then develop and
commercialize the products that are the subject of our collaboration with them
and whether any of those products will be commercially successful. In general,
our future success is dependent upon numerous factors, including our ability
to generate pre-clinical development candidates for selection into clinical
testing, obtaining regulatory approval of product development programs,
conducting and completing clinical trials, obtaining regulatory approval of
our products and product candidates, our ability to successfully partner with
leading pharmaceutical companies, and creating opportunities for future
commercialization of compounds. Our future revenue and operating and net loss
or income could be worse than anticipated if demand for our products is less
than expected, if our partnerships and collaborations with other parties are
not successful, if our drug pipeline does not progress, or if the
introductions of new products are delayed, for any reason, including
regulatory delay. References made to the discussion of risk factors are
detailed in the Company's filings with the Securities and Exchange Commission
including reports on its most recently filed Form 10-K and Form 10-Q. These
forward-looking statements are made only as of the date hereof, and we
disclaim any obligation to update or revise the information contained in any
such forward-looking statements, whether as a result of new information,
future events or otherwise.

 Condensed Consolidated Statements of Operations and Balance Sheets to follow

ASTEX PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
                                                                      
                                Three months ended         Nine months ended
                                September 30,              September 30,
                                2012          2011         2012      2011
                                                            
Revenues:                                                             
Royalty revenue                  $ 16,995      $ 16,638     $ 52,030  $ 45,148
Development and license revenue  199           308          7,068     562
Total revenues                   17,194        16,946       59,098    45,710
                                                                      
Operating expenses:                                                   
Research and development         13,633        13,546       43,092    29,531
General and administrative       4,188         5,095        12,180    12,246
Amortization of intangibles      1,938         1,485        6,036     1,485
Impairment of intangibles        7,402         --           7,402     --
Gains on disposition of assets   (576)         --           (1,276)   (700)
and sale of products
Total operating expenses         26,585        20,126       67,434    42,562
                                                                      
Income (loss) from operations    (9,391)       (3,180)      (8,336)   3,148
                                                                      
Interest income                  50            48           136       153
Gain on sale of investments and  2,591         --           2,583     10
fixed assets
Other than temporary decline in  (485)         --           (524)     --
value of investments
Other income (expense)           (4)           (291)        (31)      (291)
Income (loss) before income      (7,239)       (3,423)      (6,172)   3,020
taxes
                                                                      
Income tax benefit               5,479         2,352        9,892     2,302
                                                                      
Net income (loss)                $ (1,760)     $ (1,071)    $ 3,720   $ 5,322
Net income (loss) per common                                          
share:
Basic                            $ (0.02)      $ (0.01)     $ 0.04    $ 0.08
Diluted                          $ (0.02)      $ (0.01)     $ 0.04    $ 0.08
Weighted average shares                                               
outstanding:
Basic                           93,316        86,116       93,175    69,054
Diluted                         93,316        86,116       102,335   69,809
                                                                      
                                                                      
ASTEX PHARMACEUTICALS, INC.                                           
CONDENSED CONSOLIDATED BALANCE SHEETS                                 
(In thousands)                                                        
(Unaudited)                                                           
                                                                      
                                September 30, December 31,            
                                2012          2011                    
                                                                      
ASSETS                                                                
                                                                      
 Current assets:                                                      
 Cash and cash equivalents       $ 26,772      $ 39,788               
 Marketable securities           103,065       86,444                 
 Accounts receivable             880           5,189                  
 Income tax receivable           6,174         2,963                  
 Prepaid expenses and other      2,146         2,186                  
current assets
 Total current assets            139,037       136,570                
                                                                      
 Marketable securities,          31            1,819                  
non-current
 Property, plant and equipment,  5,911         7,013                  
net  
 Goodwill                        46,822        44,794                 
 Other intangible assets, net    76,547        86,198                 
 Other assets                    1,564         554                    
 Total assets                    $ 269,912     $ 276,948              
                                                                      
LIABILITIES & STOCKHOLDERS' EQUITY                                    
                                                                      
 Current liabilities:                                                 
 Accounts payable                $ 7,723       $ 7,529                
 Accrued compensation            4,213         5,324                  
 Other accrued liabilities       616           613                    
 Deferred acquisition            8,283         17,353                 
consideration 
 Deferred tax liability          3,496         3,342                  
 Deferred revenue                --            509                    
 Total current liabilities       24,331        34,670                 
                                                                      
 Warrant liability               316           187                    
 Deferred acquisition            8,628         11,624                 
consideration, non-current 
 Deferred tax liability,         4,152         9,545                  
non-current
 Deferred revenue,               --            921                    
non-current  
 Total liabilities               37,427        56,947                 
                                                                      
 Total stockholders' equity      232,485       220,001                
 Total liabilities and           $ 269,912     $ 276,948              
stockholders' equity

CONTACT: Timothy L. Enns
         Astex Pharmaceuticals, Inc.
         Senior Vice President
         Corporate Communications & Marketing
         Tel:  +1 (925) 560-2810
         E-mail:  tim.enns@astx.com
        
         Susanna Chau
         Astex Pharmaceuticals, Inc.
         Manager
         Investor Relations
         Tel:  +1 (925) 560-2845
         E-mail:  susanna.chau@astx.com
        
         Alan Roemer
         The Trout Group
         Managing Director
         Tel:  +1 (646) 378-2945
         E-mail: aroemer@troutgroup.com
        
         Kari Watson
         MacDougall Biomedical Communications
         Senior Vice President
         Tel: +1 (781) 235-3060
         E-mail: kwatson@macbiocom.com

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