Vanda Pharmaceuticals Reports Fourth Quarter 2012 and Full Year 2012 Results

 Vanda Pharmaceuticals Reports Fourth Quarter 2012 and Full Year 2012 Results

PR Newswire

WASHINGTON, Feb. 12, 2013

WASHINGTON, Feb. 12, 2013 /PRNewswire/ --Vanda Pharmaceuticals Inc. (Vanda)
(NASDAQ: VNDA), a biopharmaceutical company focused on the development and
commercialization of products for the treatment of central nervous system
disorders, today announced financial and operational results for the fourth
quarter and full year ended December 31, 2012.

Key Highlights:

  oVanda reported positive SET and RESET Phase III efficacy studies for
    tasimelteon in the treatment of patients with Non-24-Hour Disorder
    (Non-24). Study results demonstrate tasimelteon is a unique circadian
    regulator that resets the master body clock and improves clinical symptoms
    in patients with Non-24.
  oThe tasimelteon Non-24 program continues towards the goal of a projected
    mid-2013 New Drug Application (NDA) filing with the U.S. Food and Drug
    Administration (FDA).
  oAll tasimelteon activities have been discontinued related to the Major
    Depressive Disorder (MDD) indication. In January 2013, Vanda announced
    that the MAGELLAN Phase IIb/III clinical study did not meet its primary
    endpoint.
  oVanda has formally requested a re-examination of the negative opinion
    issued by the European Medicines Agency (EMA) recommending against
    approval of Fanaptum™ (oral iloperidone tablets) in the European Union.
  oVanda recorded full year 2012 revenue of $32.7 million including Fanapt®
    royalties of $5.9 million. Fanapt® prescriptions, as reported by IMS,
    were approximately 38,200 for the fourth quarter of 2012. This represents
    a 1% decrease versus third quarter 2012 prescriptions and a 13% increase
    over fourth quarter 2011 prescriptions. 

FULL YEAR 2012 REPORTED RESULTS

Total revenues for the full year 2012 were $32.7 million, compared to $31.3
million for 2011. Full year 2012 revenues included $5.9 million in Fanapt^®
royalties received from Novartis, as compared to $4.5 million for the prior
year. Both 2012 and 2011 revenues include $26.8 million recognized from the
$200.0 million upfront payment previously received from Novartis for Fanapt^®
U.S. and Canadian rights.

Total operating expenses for 2012 were $61.0 million, compared to $42.0
million for 2011. The primary driver of the higher expenses in 2012 was the
ongoing support of the tasimelteon Non-24 and MDD clinical studies.

Vanda recorded a net loss of $27.7 million for 2012, compared to net loss of
$9.8 million for 2011. Diluted net loss per share for 2012 was $0.98,
compared to a diluted net loss per share of $0.35 for 2011.

Vanda's cash, cash equivalents and marketable securities as of December 31,
2012 totaled $120.4 million.

FOURTH QUARTER 2012 REPORTED RESULTS

Total revenues for the fourth quarter of 2012 were $7.9 million, compared to
$8.4 million for 2011. Fourth quarter 2012 revenues included $1.2 million in
Fanapt^® royalties received from Novartis as compared to royalties of $1.6
million for the fourth quarter of 2011. 

Total operating expenses for the fourth quarter of 2012 and 2011 were each
$14.3 million.

Vanda recorded a net loss of $6.4 million for the fourth quarter of 2012,
compared to a net loss of $5.5 million for the fourth quarter of 2011.
Diluted net loss per share for the fourth quarter of 2012 was $0.23, compared
to a diluted net loss of $0.20 per share for the fourth quarter of 2011.



Full Year December 31, 2012 Key Financial Figures^1
                                

                                Twelve Months Ended
                                December 31  December 31
(in thousands, except per share 2012         2011          Change ($)  Change
amounts)                                                                (%)
Total revenues                  $        $        $        5%
                                32,727       31,270       1,457
Research & development         45,446       28,996       16,450        57%
expenses
General & administrative        13,882       11,486       2,396         21%
expenses
Non-cash stock-based            4,094        5,501        (1,407)       (26%)
compensation^2
Loss before tax benefit         (27,664)     (10,246)     (17,418)      (170%)
Tax benefit                     -            (444)        444           100%
Net loss                        (27,664)     (9,802)      (17,862)      (182%)
Diluted net loss per share      $       $       $        (180%)
                                (0.98)      (0.35)      (0.63)



Fourth Quarter 2012 Key Financial Figures^1
                               Three Months Ended
                               December 31  September 30
(in thousands, except per      2012         2012           Change ($)  Change
share amounts)                                                          (%)
Total revenues                 $       $        $        (4%)
                               7,920        8,288          (368)
Research & development        10,617       10,159        458           5%
expenses
General & administrative       3,225        3,147         78            2%
expenses
Non-cash stock-based           923          576           347           60%
compensation^2
Loss before tax benefit        (6,369)      (5,326)       (1,043)       (20%)
Tax benefit                    -            -             -
Net loss                       (6,369)      (5,326)       (1,043)       (20%)
Diluted net loss per share     $       $        $        (21%)
                               (0.23)      (0.19)       (0.04)



Select Cash Flow Data^1
                               Twelve Months Ended
                               December 31        December 31
(in thousands)                 2012               2011
Net cash provided by (used in)
Operating activities           $    (44,917)  $    (28,410)
Investing activities           45,754             73,749
Financing activities           12                 25



Select Balance Sheet Data^1
                             December 31      September 30     December 31
(in thousands)               2012             2012             2011
Total cash and marketable    $    120,403  $    134,404  $    167,896
securities

(1) Unaudited
(2) Non-cash stock-based compensation is allocated to both Research &
development and General & administrative expenses

OPERATIONAL HIGHLIGHTS

In December 2012 and January 2013, Vanda announced positive results for two
Phase III studies for tasimelteon in the treatment of Non-24. The SET Phase
III study demonstrated that tasimelteon was able to entrain the master body
clock as measured by melatonin and cortisol circadian rhythms. Tasimelteon
was also shown to significantly improve clinical symptoms across a number of
sleep and wake measures. These results provided robust evidence of direct and
clinically meaningful benefits to patients with Non-24. The RESET Phase III
study demonstrated the maintenance effect of 20mg of tasimelteon to entrain
melatonin and cortisol circadian rhythms in individuals with Non-24.
Patients treated with tasimelteon maintained their clinical benefits while
patients receiving placebo showed significant deterioration in measures of
nighttime sleep, daytime naps and timing of sleep. Non-24 is a serious, rare
circadian rhythm disorder that affects a majority of totally blind individuals
who lack light perception and cannot entrain (reset) their master body clock
to the 24-hour day. Currently there is no approved treatment for Non-24.

Vanda plans to submit an NDA to the FDA in mid-2013. Vanda will meet with the
FDA in Q1 of 2013 for a pre-NDA meeting on tasimelteon in the treatment of
patients with Non-24.

Vanda has decided to discontinue all activities related to the MDD
indication. In January, Vanda announced that the MAGELLAN Phase IIb/III
clinical study in MDD did not meet the primary endpoint of a change from
baseline in the Hamilton Depression Scale (HAMD-17) after 8 weeks of treatment
as compared to placebo.

Vanda has formally appealed the EMA's negative opinion for Fanaptum™ (oral
iloperidone tablets) and requested a re-examination of the decision by the
EMA's Committee for Medicinal Product for Human Use (CHMP). In December 2012,
the CHMP issued a negative opinion recommending against approval of Fanaptum™
for the treatment of schizophrenia in adult patients in the European Union.

Vanda recorded full year 2012 revenue of $32.7 million including Fanapt^®
royalties of $5.9 million. Fanapt^® prescriptions, as reported by IMS, were
approximately 38,200 for the fourth quarter of 2012. This represents a 1%
decrease versus third quarter 2012 prescriptions and a 13% increase over
fourth quarter 2011 prescriptions.

CONFERENCE CALL

Vanda has scheduled a conference call for today, Tuesday, February 12, 2013,
at 10:00 AM ET. During the call, Vanda's management will discuss the fourth
quarter and full year 2012 results and other corporate activities. Investors
can call 800-901-5248 (domestic) and 617-786-4512 (international) and use
passcode 86594010. A replay of the call will be available beginning Tuesday,
February 12, 2013 at 12:00 PM ET and will be accessible until Tuesday,
February 19, 2013, at 5:00 PM ET. The replay call-in number is 1-888-286-8010
for domestic callers and 1-617-801-6888 for international callers. The access
number is 89804635.

The conference call will be broadcast simultaneously on Vanda's website,
http://www.vandapharma.com. Investors should click on the Investor Relations
tab and are advised to go to the website at least 15 minutes early to
register, download, and install any necessary software or presentations. The
call will also be archived on Vanda's website for a period of 30 days, through
March 14, 2013.

ABOUT VANDA PHARMACEUTICALS INC.:

Vanda Pharmaceuticals Inc. is a biopharmaceutical company focused on the
development and commercialization of products for the treatment of central
nervous system disorders. For more on Vanda, please visit
http://www.vandapharma.com.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Various statements in this release are "forward-looking statements" under the
securities laws. Words such as, but not limited to, "believe," "expect,"
"anticipate," "estimate," "intend," "plan," "project," "target," "goal,"
"likely," "will," "would," and "could," or the negative of these terms and
similar expressions or words, identify forward-looking statements.
Forward-looking statements are based upon current expectations that involve
risks, changes in circumstances, assumptions and uncertainties. Important
factors that could cause actual results to differ materially from those
reflected in the company's forward-looking statements include, among others:
the inability to reach agreement with the FDA regarding Vanda's regulatory
approval strategy or proposed path to approval for tasimelteon for the
treatment of Non-24; Vanda's failure to obtain regulatory approval for
tasimelteon for the treatment of Non-24 or to comply with ongoing regulatory
requirements; the extent and effectiveness of the development, sales and
marketing and distribution support Fanapt^® receives; Vanda's ability to
successfully commercialize Fanapt^® outside of the U.S. and Canada and other
factors that are described in the "Risk Factors" and "Management's Discussion
and Analysis of Financial Condition and Results of Operations" sections of
Vanda's annual report on Form 10-K for the fiscal year ended December 31, 2011
which is on file with the SEC and available on the SEC's website at
www.sec.gov. In addition to the risks described above and in Vanda's annual
report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form
8-K and other filings with the SEC, other unknown or unpredictable factors
also could affect Vanda's results. There can be no assurance that the actual
results or developments anticipated by Vanda will be realized or, even if
substantially realized, that they will have the expected consequences to, or
effects on, Vanda. Therefore, no assurance can be given that the outcomes
stated in such forward-looking statements and estimates will be achieved.

All written and verbal forward-looking statements attributable to Vanda or any
person acting on its behalf are expressly qualified in their entirety by the
cautionary statements contained or referred to herein. Vanda cautions
investors not to rely too heavily on the forward-looking statements Vanda
makes or that are made on its behalf. The information in this release is
provided only as of the date of this release, and Vanda undertakes no
obligation, and specifically declines any obligation, to update or revise
publicly any forward-looking statements, whether as a result of new
information, future events or otherwise.

     VANDA PHARMACEUTICALS INC.
     CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
                        Three Months Ended          Twelve Months Ended
(in thousands, except   December 31   December 31   December 31   December 31
for share)
and per share amounts)  2012          2011          2012          2011
Revenues:
     Licensing          $ 6,752       $ 6,752       $ 26,789      $ 26,789
     agreement
     Royalty revenue      1,168         1,618         5,938         4,481
             Total        7,920         8,370         32,727        31,270
             revenues
Operating expenses:
     Cost of sales        129           -             129           -
     Research and         10,617        10,556        45,446        28,996
     development
     General and          3,225         3,345         13,882        11,486
     administrative
     Intangible asset     377           377           1,495         1,495
     amortization
             Total
             operating    14,348        14,278        60,952        41,977
             expenses
Loss from operations      (6,428)       (5,908)       (28,225)      (10,707)
     Other income         59            99            561           461
Loss before tax           (6,369)       (5,809)       (27,664)      (10,246)
benefit
     Tax benefit          -             (286)         -             (444)
Net loss                $ (6,369)     $ (5,523)     $ (27,664)    $ (9,802)
Net loss per share:
     Basic              $ (0.23)      $ (0.20)      $ (0.98)      $ (0.35)
     Diluted            $ (0.23)      $ (0.20)      $ (0.98)      $ (0.35)
Shares used in
calculation of net loss
     per share:
     Basic               28,233,409    28,115,175    28,228,409    28,106,831
     Diluted              28,233,409    28,115,175    28,228,409    28,106,831

VANDA PHARMACEUTICALS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(in thousands)                            December 31, 2012  December 31, 2011
ASSETS
 Current assets:
  Cash and cash equivalents               $    88,772        $    87,923
  Marketable securities, current               31,631             60,961
  Accounts receivable                          1,168              1,618
  Inventory                                    57                 -
  Prepaid expenses and other current           3,910              2,999
  assets
  Restricted cash, current                     430                -
         Total current assets                  125,968            153,501
 Marketable securities, non-current            -                  19,012
 Property and equipment, net                   2,348              964
 Other assets, non-current                     -                  84
 Intangible asset, net                         6,532              8,027
 Restricted cash, non-current                  600                1,030
         Total assets                     $    135,448       $    182,618
LIABILITIES AND STOCKHOLDERS' EQUITY
 Current liabilities:
  Accounts payable                        $    287           $    996
  Accrued liabilities                          5,187              3,381
  Deferred rent, current                       -                  453
  Deferred revenues, current                   26,789             26,789
         Total current liabilities             32,263             31,619
 Non-current liabilities:
  Deferred rent, non-current                   3,005              461
  Deferred revenues, non-current               90,275             117,064
         Total liabilities                     125,543            149,144
 Stockholders' equity:
  Common stock                                 28                 28
  Additional paid-in capital                   300,974            296,868
  Accumulated other comprehensive income       10                 21
  Accumulated deficit                          (291,107)          (263,443)
         Total stockholders' equity            9,905              33,474
         Total liabilities and            $    135,448       $    182,618
         stockholders' equity

COMPANY CONTACT:
Cristina Murphy
Senior Communications Manager
Vanda Pharmaceuticals Inc.
(202) 734-3414
cristina.murphy@vandapharma.com

SOURCE Vanda Pharmaceuticals Inc.

Website: http://www.vandapharma.com