NPS Pharmaceuticals Reports Third Quarter 2012 Financial Results and Reiterates Year-end Cash Guidance

  NPS Pharmaceuticals Reports Third Quarter 2012 Financial Results and
  Reiterates Year-end Cash Guidance

     -- FDA Advisory Committee unanimously recommends approval of Gattex®
       (teduglutide) for adult patients with short bowel syndrome --

 -- One out of seven patients has now achieved independence from PN/IV fluids
                         in ongoing STEPS 2 study --

                  -- Conference call today at 8:30 AM ET --

Business Wire

BEDMINSTER, N.J. -- November 09, 2012

NPS Pharmaceuticals, Inc. (NASDAQ: NPSP), a specialty pharmaceutical company
developing orphan therapeutics for rare gastrointestinal and endocrine
disorders, today reported its results for the third quarter of 2012.

NPS reported a net loss of $3.3 million or $0.04 per diluted share for the
third quarter of 2012, compared to a net loss of $12.3 million or $0.14 per
diluted share for the third quarter of 2011. Cash and investments totaled
$118.7 million at September 30, 2012, compared with $162.2 million at December
31, 2011. NPS continues to expect to end the year with at least $92 million of
cash and investments.

“With last month’s unanimous recommendation by FDA’s Gastrointestinal Drugs
Advisory Committee, Gattex is poised to become the first significant medical
advance for the long-term treatment of SBS in nearly 40 years,” commented
Francois Nader, MD, president and chief executive officer, NPS
Pharmaceuticals. “Recent data from the Gattex clinical program demonstrate
life-changing findings for patients. Specifically, one in seven patients has
now achieved complete independence from parenteral support in our ongoing
long-term STEPS 2 study. As a result of the committee’s positive vote, we will
now be proceeding with the hiring of several key commercial positions and
finalizing Gattex launch-readiness. This is a transformational period for NPS
and we are thrilled to be one step closer to achieving our goal of bringing
Gattex to the market early next year and addressing the unmet needs of people
with short bowel syndrome.”

Dr. Nader added: “We also continue to make strong progress towards completing
our Biologic License Application for Natpara as the first replacement therapy
for hypoparathyroidism. We remain on track to deliver a submission in line
with our mid-2013 guidance.”

Pipeline and other business highlights

Gattex^® (teduglutide) in short bowel syndrome

  *On October 16, 2012, the U.S. Food and Drug Administration’s (FDA)
    Gastrointestinal Drugs Advisory Committee voted unanimously to recommend
    approval of Gattex® (teduglutide) for adults with short bowel syndrome
    (SBS). The committee’s recommendation will be considered by the FDA in its
    review of the company’s New Drug Application (NDA). The Prescription Drug
    User Fee Act (PDUFA) action date for the Gattex NDA is December 30, 2012.
  *NPS recently reported that five additional patients successfully achieved
    independence from parenteral nutrition (PN) and/or intravenous fluids (IV)
    in STEPS 2, an ongoing 24-month, open-label study in adult SBS. To date,
    12 patients, or one out of seven, have achieved independence from PN/IV
    while on Gattex therapy in STEPS 2. Ten of the 12 patients were able to
    discontinue PN/IV after a year or more on Gattex reinforcing the positive
    effects of the long-term use of the drug. NPS expects STEPS 2 to complete
    in early 2013 and will report full results thereafter.
  *At the American College of Gastroenterology Annual Scientific Meeting,
    investigators reported data related to the seven patients who previously
    achieved complete independence from PN/IV in STEPS 2. Demographics and
    disease characteristics for these patients varied widely. The duration of
    time the patients had been treated with Gattex at the time their PN/IV was
    discontinued ranged from six months to nearly two years.

Natpara^® (recombinant human parathyroid hormone [1-84]) in hypoparathyroidism

  *NPS continues to be on track to submit its Biologic License Application
    (BLA) to the FDA by mid-2013 seeking marketing approval of Natpara for
    hypoparathyroidism.

  *At the Annual Meeting of the American Society for Bone and Mineral
    Research (ASBMR) investigators presented additional findings from the
    Phase 3 REPLACE study of Natpara® (rhPTH [1-84]) that showed Natpara
    initiated bone remodeling as demonstrated by significant increases in bone
    turnover markers. Investigators also reported results from RELAY, an
    eight-week study that evaluated 25μg or 50μg daily doses of Natpara and
    concluded that such dosages may be sufficient for a small percentage of
    patients with hypoparathyroidism.

NPSP790 and NPSP795 (calcilytics)

  *The clinical development and manufacturing planning processes are underway
    for the clinical proof-of-concept study of the company’s calcilytic
    compounds, NPSP790 and NPSP795. NPS believes calcilytics may have clinical
    application in treating rare disorders involving increased calcium
    receptor activity, such as autosomal dominant hypocalcemia with
    hypercalciuria or ADHH.

Financial results

Royalties

Royalty revenues were $27.0 million for the third quarter of 2012, compared
with $24.5 million for the third quarter of 2011. NPS earns royalties on (i)
Amgen’s sales of Sensipar^®/Mimpara^® (cinacalcet HCl), (ii) Kyowa Hakko
Kirin’s sales of REGPARA^® (cinacalcet HCl), (iii) Nycomed’s sales of
Preotact^® (recombinant parathyroid hormone 1-84 [rDNA origin] injection), and
(iv) Janssen Pharmaceuticals’ sales of NUCYNTA^® (tapentadol) and NUCYNTA^® ER
(tapentadol extended-release tablets).

The components of royalties are summarized as follows:

                                           
In millions             Three months ended         Nine months ended
                        September 30,              September 30,
                        2012      2011             2012     2011
Royalty:
Sensipar                $23.0     $19.8            $65.2    $56.6
REGPARA                 2.3       2.0              6.4      5.5
Preotact                1.0       2.1              4.8      6.5
NUCYNTA and other       0.7       0.6              2.1      1.6
Total                   $27.0     $24.5            $78.5    $70.2
                                                            

On November 15, 2012, the company will receive a cash payment of $15.0 million
for the Sensipar royalties earned during the third quarter of 2012. The
remaining $8 million of Sensipar royalties will be retained to repay a royalty
advance received in August 2011 from Amgen.

Research and development

Research and development expenses were $18.0 million for the third quarter of
2012, compared with $20.2 million for the third quarter of 2011. The decrease
in research and development expenses was primarily due to a reduction in costs
associated with clinical development activities and the production of
prelaunch Gattex inventory.

General and administrative

General and administrative expenses were $8.3 million for the third quarter of
2012, compared with $6.4 million for the third quarter of 2011. The increase
in general and administrative expenses was primarily due to
commercial-readiness activities for Gattex.

Interest expense

Interest expense was $4.4 million for the third quarter of 2012 and $10.6
million for the third quarter of 2011. Interest expense is largely
attributable to non-recourse debt secured by the company’s Sensipar/Mimpara,
REGPARA, and Preotact royalties. The decline in interest expense was primarily
attributable to a reduction in the outstanding principal and interest rate
associated with Sensipar/Mimpara-secured non-recourse debt.

Cash and investments

At September 30, 2012, the company’s cash, cash equivalents, and marketable
investment securities totaled approximately $119 million compared with $162
million at December 31, 2011.

Long-term debt

At September 30, 2012, the company’s only recourse debt was $16.5 million in
5.75% convertible notes due in 2014.

All other debt on the company’s balance sheet is non-recourse and solely
secured by its royalty rights related to Sensipar/Mimpara, Preotact, and
REGPARA. After repayment of these obligations, as set forth in the agreements,
the cash flows from the royalties will be paid to NPS.

The following table reflects the company’s non-recourse debt at September 30,
2012 and December 31, 2011:

                                                       
In millions
                                          September 30,         December 31,
                                                                2011
                                          2012
Non-recourse debt:
Sensipar/Mimpara-secured                  $86.3                 $126.8
Preotact-secured                          43.8                  48.3
REGPARA-secured                           36.3                  36.3
Total non-recourse debt                   166.4                 211.4
Less current portion                      7.0                   19.3
Total long-term non-recourse debt         $159.4                $192.1
                                                                

Conference Call Information

NPS will host a conference call beginning today at 8:30 a.m. Eastern Time. To
participate in the conference call, dial (800) 299-9086 and use pass code
55167232. International callers may dial (617) 786-2903, using the same pass
code. In addition, a live audio of the conference call will be available over
the Internet. Interested parties can access the event through the NPS website,
http://www.npsp.com.

For those unable to participate in the live call, a replay will be available
at (888) 286-8010, with pass code 27933265, until midnight Eastern Time,
November 19, 2012. International callers may access the replay by dialing
(617) 801-6888, using the same pass code. The webcast will also be available
through the NPS website for the same period.

About NPS Pharmaceuticals

NPS Pharmaceuticals is a biopharmaceutical company focused on bringing orphan
products to patients with rare disorders and few, if any, therapeutic options.
NPS is advancing two late-stage registration programs. A New Drug Application
is undergoing FDA review for Gattex® (teduglutide) as a treatment for adults
with short bowel syndrome (SBS) and a Biologic License Application is being
prepared for Natpara® (rhPTH[1-84]) in adult hypoparathyroidism. NPS' earlier
stage pipeline includes two calcilytic compounds, NPSP790 and NPSP795, with
potential application in rare disorders involving increased calcium receptor
activity, such as autosomal dominant hypocalcemia with hypercalciuria (ADHH).
NPS complements its proprietary programs with a royalty-based portfolio of
products and product candidates that includes agreements with Amgen,
GlaxoSmithKline, Janssen Pharmaceuticals, Kyowa Hakko Kirin, and Nycomed, a
Takeda company.

About Gattex® (teduglutide) in adult short bowel syndrome

Gattex is a novel, recombinant analog of human glucagon-like peptide 2, a
protein involved in the rehabilitation of the intestinal lining. It has been
developed to reduce dependence on parenteral nutrition (PN) and intravenous
fluids (IV) in adult patients with short bowel syndrome (SBS). Significant
reductions in mean PN/IV infusion volume from baseline to end of treatment
were seen in the Phase 3 studies of Gattex. In addition, some patients were
able to be weaned off PN during these trials. The most common
treatment-emergent adverse events with Gattex in the placebo-controlled
studies that occurred at a higher frequency with Gattex were abdominal pain,
upper respiratory tract infections, nausea, injection site reactions,
abdominal distension, headaches, and gastrointestinal stoma complications.

Natpara® (rhPTH [1-84]) in hypoparathyroidism

Natpara is a bioengineered replica of human parathyroid hormone that is being
developed by NPS for adults with hypoparathyroidism, a rare endocrine disorder
that is characterized by insufficient levels of parathyroid hormone, the
body’s principal regulator of calcium and phosphorus. In the randomized,
placebo-controlled REPLACE study, treatment with Natpara resulted in
significant reductions in calcium and active vitamin D supplements. Overall
rates of adverse events during the 24-week treatment period were similar (90%
vs. 96% Natpara and placebo, respectively). The spectrum of adverse events
reflected underlying disease pathophysiology with most common being
paresthesia, muscle spasms, headache, and hypocalcemia.

"NPS," "NPS Pharmaceuticals," "Gattex," and "Natpara" are the company's
trademarks. All other trademarks, trade names or service marks appearing in
this press release are the property of their respective owners.

Statements made in this press release, which are not historical in nature,
constitute forward-looking statements for purposes of the safe harbor provided
by the Private Securities Litigation Reform Act of 1995. These statements are
based on the company's current expectations and beliefs and are subject to a
number of factors and uncertainties that could cause actual results to differ
materially from those described in the forward-looking statements. Forward
looking statements include, but are not limited to, statements concerning our
future financial performance. Risks associated to the company's business
include, but are not limited to, the risks associated with any failure by the
company to successfully complete its preclinical and clinical studies within
the projected time frames or not at all, the risk of not gaining marketing
approvals for Gattex and Natpara, the risks associated with the company's
strategy, global macroeconomic conditions, the impact of changes in management
or staff levels, the effect of legislation effecting healthcare reform in the
United States, as well as other risk factors described in the company's
periodic filings with the U.S. Securities and Exchange Commission, including
its Annual Report on Form 10-K and Form 10-Qs. All information in this press
release is as of the date of this release and NPS undertakes no duty to update
this information, whether as a result of new information, future events or
otherwise.

                       (Financial statements to follow)

                 


NPS PHARMACEUTICALS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(In thousands, except per share data)

(Unaudited)
                                                                       
                        Three Months Ended               Nine months ended
                        September 30,                            September 30,
                        2012                2011                 2012                2011
                                                                                     
Revenues:
Royalties               $ 27,012            $ 24,483             $ 78,453            $ 70,244
Sale of                   --                  --                   25,000              --
royalty rights
Milestones and            7                   19                   7                   5,044
license fees
Product sales            --                99                 --                99       
Total revenues           27,019            24,601             103,460           75,387   
                                                                                     
Costs and
expenses:
Cost of                   --                  --                   --                  500
royalties
Cost of                   --                  2                    --                  2,540
license fees
Research and              17,957              20,227               70,797              52,267
development
General and              8,329             6,413              25,769            17,028   
administrative
Total
operating                26,286            26,642             96,566            72,335   
expenses
Operating                 733                 (2,041   )           6,894               3,052
income (loss)
Other
(expense)
income:
Interest                  64                  70                   224                 260
income, net
Interest                  (4,444  )           (10,589  )           (14,445 )           (31,150  )
expense
Other                    323               211                795               225      
Total other              (4,057  )          (10,308  )          (13,426 )          (30,665  )
expense, net
Loss before
income tax                (3,324  )           (12,349  )           (6,532  )           (27,613  )
expense
                                                                                     
Income tax               --                --                 --                18       
expense
Net loss                 ($3,324 )          ($12,349 )          ($6,532 )          ($27,631 )
Net loss per
common and
potential
common share:
Basic                    ($0.04  )          ($0.14   )          ($0.08  )          ($0.35   )
Diluted                  ($0.04  )          ($0.14   )          ($0.08  )          ($0.35   )
Weighted
average common       
and potential
common share:
Basic                    86,947            86,749             86,910            79,417   
Diluted                  86,947            86,749             86,910            79,417   
                                                                                                


NPS PHARMACEUTICALS, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(In thousands)

(Unaudited)
                                               September          December 31,
                                          30,            2011
                                               2012
Assets:
Cash, cash equivalents and marketable          $118,723           $162,233
investment securities
Account receivable                             28,074             29,532
Other current assets                           4,681              7,863
Property and equipment, net                    4,097              4,346
Goodwill                                       9,429              9,429
Debt issuance costs, net                       462                577
Total assets                                   $165,466           $213,980
                                                                  
Liabilities and Stockholders’ Deficit:
Current liabilities                            $29,567            $43,603
Convertible notes                              16,545             16,545
Non-recourse debt, less current                159,400            192,085
portion*
Other long-term liabilities                    6,695              7,863
Total liabilities                              212,207            260,096
                                                                  
Common stock and additional paid-in            950,212            944,430
capital
Accumulated other comprehensive                29                 (96)
income
Accumulated deficit                            (996,982)          (990,450)
Total stockholders'                            (46,741)           (46,116)
deficit
Total liabilities and                          $165,466           $213,980
stockholders' deficit
                                                                  
* Non-recourse debt secured by Sensipar^®/Mimpara^®, Preotact^® and REGPARA^®
royalty revenue


Contact:

NPS Pharmaceuticals, Inc.
Susan M. Mesco, 908-450-5516
smesco@npsp.com
 
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