DURECT Corporation Announces First Quarter 2013 Financial Results and Update of Programs

 DURECT Corporation Announces First Quarter 2013 Financial Results and Update
                                 of Programs

PR Newswire

CUPERTINO, Calif., May 2, 2013

CUPERTINO, Calif., May 2, 2013 /PRNewswire/ -- DURECT Corporation (Nasdaq:
DRRX) announced today financial results for the first quarter of 2013. Total
revenues were $4.2 million and net loss was $5.2 million for the three months
ended March 31, 2013. For comparison, total GAAP revenue was $41.2 million
and net income was $30.8 million for the three months ended March 31, 2012.
The revenue for the first quarter of 2012 included the accelerated recognition
of $35.4 million in deferred revenue associated with upfront fees previously
received under terminated collaboration agreements; this revenue was
non-recurring and had no cash flow impact. Adjusting for this non-recurring
revenue, revenue for the first three months ended March 31, 2012 would have
been $5.8 million and net loss would have been $4.6 million.

(Logo: http://photos.prnewswire.com/prnh/20020717/DRRXLOGO)

At March 31, 2013, we had cash and investments of $25.5 million, compared to
cash and investments of $28.9 million at December 31, 2012. 

"We were pleased to announce on April 16 that we had submitted the New Drug
Application (NDA) for POSIDUR^™ and look forward to the FDA's review," stated
James E. Brown, D.V.M., President and CEO of DURECT. "The FDA's recent
decisions to allow updated labeling for opioids that demonstrate
abuse-deterrent properties and not to allow generics against the original
OxyContin^® are positive developments for REMOXY^®. Pfizer recently stated
that they had a productive meeting with the FDA in late March and we note the
recent additional patent issuance extending coverage of REMOXY in the U.S. to
at least 2031. Another positive event during the first quarter was our
collaborator Zogenix reporting positive results from the Relday^™ Phase 1
study and rapid expansion of that study to include a higher dose, which today
also reported positive results."

Update of Programs:

  oREMOXY (oxycodone) Extended-Release Capsules CII. Pfizer has efforts
    underway to resolve the issues raised in the REMOXY Complete Response
    Letter, which are primarily related to manufacturing. Pfizer held a
    meeting with the FDA in late March 2013 to discuss their proposed
    resubmission plan for REMOXY. On April 30, Pfizer stated that they had a
    productive meeting with the FDA and received guidance that is helping to
    inform the next steps in addressing the issues raised by the FDA in the
    Complete Response Letter. In 2013, we received issuance of an additional
    ORADUR^® patent that would protect REMOXY in the U.S. until at least
    2031.

    On April 16, 2013, the FDA announced two actions relevant to
    abuse-deterrent opioids. First, after reviewing the available science,
    the FDA will allow the label for opioids to describe abuse-deterrent
    properties. Second, the FDA will not accept or approve any generic forms
    of the original OxyContin ER.

    REMOXY,  an investigational drug, is a unique long  acting oral
    formulation of oxycodone intended to treat moderate-to-severe pain when a
    continuous, around the clock opioid analgesic is needed for an extended
    period of time. Based on DURECT's ORADUR technology, which is covered by
    issued patents and pending patent applications owned by us, REMOXY is
    designed to discourage common methods of tampering associated with
    prescription opioid analgesic misuse and abuse.

  oPOSIDUR (SABER^®-Bupivacaine) Post-Operative Pain Relief Depot. In April
    2013, we submitted a new drug application (NDA) as a 505(b)(2)
    application, which relies in part on the FDA's findings of safety and
    effectiveness of a reference drug. We expect that the FDA will notify us
    whether our NDA submission has been accepted for filing in June 2013. If
    accepted for filing, the FDA would be expected to assign a Prescription
    Drug User Fee Act (PDUFA) target date (the date the FDA expects to
    complete its review of the POSIDUR NDA) in the first quarter of 2014.

    DURECT will be presenting a poster on POSIDUR at the American Pain Society
    Meeting on May 9 from 9:30 to 11:00 a.m. in New Orleans. This poster will
    summarize results from a well controlled shoulder surgery trial. After
    the meeting, DURECT will make the poster available through our website
    www.durect.com.

    POSIDUR is our investigational post-operative pain relief depot that
    utilizes our patented SABER technology to deliver bupivacaine to provide
    up to three days of pain relief after surgery. We are in discussions with
    potential partners regarding licensing development and commercialization
    rights to POSIDUR, for which we hold worldwide rights. 
    
  oTransdermal Development Candidates. DURECT has two transdermal products
    that are in mid- to late-stage development with features that may be
    superior to currently available patches. TRANSDUR^®-Sufentanil  is our
    proprietary transdermal patch intended to deliver sufentanil to chronic
    pain sufferers for a period of up to 7 days from a single application;
    this compares favorably against existing fentanyl patches which are
    substantially larger and typically effective for 2-3 days. ELADUR^®, for
    topical neuropathic conditions such as post-herpetic neuralgia (PHN), is
    our proprietary transdermal patch intended to deliver bupivacaine for a
    period of up to three days from a single application; existing lidocaine
    patches for this condition can be worn for 12 hours with a rest period of
    12 hours during which time many patients experience breakthrough pain. We
    are in discussions with potential partners regarding licensing development
    and commercialization rights to these two transdermal programs for which
    we hold worldwide rights.
  oORADUR-ADHD Program. We are developing a drug candidate (ORADUR-ADHD)
    based on DURECT's ORADUR Technology for the treatment of Attention Deficit
    Hyperactivity Disorder. This drug candidate is intended to provide
    once-a-day dosing with added tamper-resistant characteristics to address
    common methods of abuse and misuse of these types of drugs. We and Orient
    Pharma have completed several Phase I pharmacokinetic studies with
    multiple formulations, and we are continuing to optimize our lead
    formulations. Orient Pharma is our licensee for certain Asian and South
    Pacific countries, while we retain the rights to the rest of the world.
  oRelday^™ (Risperidone Program). In January 2013, Zogenix (our licensee)
    announced positive single-dose pharmacokinetic (PK) results from a Phase 1
    clinical trial of Relday. According to Zogenix, adverse  events in the
    Phase 1 trial in patients diagnosed with schizophrenia were generally mild
    to moderate and consistent with other risperidone products. The Phase 1
    clinical trial for Relday was conducted as a single-center, open-label,
    safety and PK trial of 30 patients with chronic, stable schizophrenia or
    schizoaffective disorder. Per Zogenix, based on the favorable safety and
    PK profile demonstrated with the 25 mg and 50 mg once-monthly doses tested
    in the Phase 1 trial, Zogenix extended the study to include a 100 mg dose
    of the same formulation. In May 2013, Zogenix announced positive results
    with the 100 mg arm, demonstrating dose proportionality across the full
    dose range that would be anticipated to be used in clinical practice.

    Relday is a proprietary, long-acting, once-monthly subcutaneous injectable
    formulation of risperidone using DURECT's SABER controlled-release
    formulation technology. An existing long-acting injectable risperidone
    product, which achieved $1.4 billion in global net sales in 2012, requires
    twice-monthly, intramuscular injections and drug reconstitution prior to
    use.

  oFeasibility Projects and Other Activities. During the first quarter of
    2013, we continued work on several feasibility projects as a means of
    demonstrating that our technologies can achieve the drug delivery
    objectives set forth by our collaborators and are worthy of further
    development. The Zogenix program, described above, was one such project
    which has matured into a development and license agreement.
  oBusiness Development Activities. We have multiple programs that may
    potentially be licensed over the next 12-18 months. These include 
    POSIDUR, TRANSDUR-Sufentanil, ELADUR, ORADUR-ADHD (territories outside
    certain Asian and South Pacific markets), as well as various internal
    programs which we have not described publicly in detail.
  oUpcoming Investor Presentation. DURECT will be presenting at the Marcum
    2013 MicroCap Conference in New York City on Thursday, May 30 at 10:30
    a.m. Eastern time at the Grand Hyatt Hotel. A live webcast of the
    presentation will be available by accessing
    http://wsw.com/webcast/marcum/drrx/ or by accessing DURECT's homepage at
    www.durect.com and clicking "Investor Relations." If you are unable to
    participate during the live webcast, the call will be archived on DURECT's
    website under Audio Archive in the "Investor Relations" section.

Earnings Conference Call
A live audio webcast of a conference call to discuss first quarter 2013
results will be broadcast live over the internet at 4:30 p.m. Eastern Time on
May 2 and is available by accessing DURECT's homepage at www.durect.comand
clicking "Investor Relations." If you are unable to participate during the
live webcast, the call will be archived on DURECT's website under Audio
Archive in the "Investor Relations" section.

About DURECT Corporation

DURECT is a specialty pharmaceutical company developing innovative drugs for
pain and chronic diseases, with late-stage development programs including
REMOXY^®, POSIDUR^™, ELADUR^®, and TRANSDUR^®-Sufentanil. DURECT's
proprietaryoral, transdermal and injectable depot delivery technologies
enable new indications and superior clinical/commercial attributes such as
abuse deterrence, improved convenience, compliance, efficacy and safety for
small molecule and biologic drugs. For more information, please visit
www.durect.com.

NOTE: POSIDUR^™, SABER^®, ORADUR^®, TRANSDUR^® and ELADUR^® are trademarks of
DURECT Corporation. Other referenced trademarks belong to their respective
owners. REMOXY, POSIDUR, ELADUR, TRANSDUR-Sufentanil and Relday are drug
candidates under development and have not been approved for commercialization
by the U.S. Food and Drug Administration or other health authorities.

DURECT Forward-Looking Statements

The statements in this press release regarding the potential regulatory
meetings and submissions for REMOXY and POSIDUR, potential regulatory
approvals of REMOXY AND POSIDUR, the potential benefits and uses of our drug
candidates, collaborations with third parties and potential business
development activities are forward-looking statements involving risks and
uncertainties that can cause actual results to differ materially from those in
such forward-looking statements. Potential risks and uncertainties include,
but are not limited to, the risk that Pfizer will discontinue development of
REMOXY, the risk of adverse decisions by regulatory agencies, including
requests for additional information or product non-approval or non-acceptance
of our POSIDUR or other NDA submissions, delays and additional costs due to
requirements imposed by regulatory agencies, potential adverse effects arising
from the testing or use of our drug candidates, the potential failure of our
clinical trials to meet their intended endpoints, our potential failure to
maintain our collaborative agreements with third parties or consummate new
collaborations and risks related to our (and our third party collaborators
where applicable) difficulty or failure to obtain approvals from regulatory
agencies with respect to our development activities and products, or ability
to design, enroll, conduct and complete clinical trials, complete the design,
development, and manufacturing process development of product candidates,
manufacture and commercialize product candidates, obtain marketplace
acceptance of product candidates, avoid infringing patents held by other
parties and secure and defend patents of our own, and manage and obtain
capital to fund operations and expenses. Further information regarding these
and other risks is included in DURECT's Form 10-K for the fiscal year ending
on December 31, 2012 under the heading "Risk Factors."





DURECT CORPORATION
CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(in thousands, except per share amounts)

(Unaudited)
                                                         Three months ended
                                                         March 31,
                                                         2013        2012
Collaborative research and development and other revenue $   913   $38,328
Product revenue, net                                     3,240       2,857
       Total revenues                                    4,153       41,185
Operating expenses:
       Cost of product revenues^                        1,658       1,461
       Research and development                          4,789       5,634
       Selling, general and administrative^             2,901       3,280
Total operating expenses                                 9,348       10,375
Income (loss) from operations                            (5,195)     30,810
Other income (expense):
       Interest and other income                         14          21
       Interest and other expense                        (2)         (2)
Net other income                                         12          19
Net Income (loss)                                        $ (5,183)   $30,829
Net income (loss) per share
       Basic                                            $  (0.05)  $  0.35
       Diluted                                           $  (0.05)  $  0.35
Weighted-average shares used in computing net income
(loss) per share
       Basic                                            101,881     87,547
       Diluted                                           101,881     87,568
Total comprehensive income (loss)                        $ (5,181)   $30,826





DURECT CORPORATION

CONDENSED BALANCE SHEETS

(in thousands)
                                  As of                  As of
                                  March 31, 2013         December 31, 2012^(1)
                                  (unaudited)
ASSETS
Current assets:
 Cash and cash equivalents     $       8,250   $          
                                                           11,195
 Short-term investments        16,261                 17,337
 Accounts receivable           1,567                  2,166
 Inventories                   3,058                  3,399
 Prepaid expenses and other    1,949                  2,258
current assets
Total current assets              31,085                 36,355
Property and equipment, net       2,229                  2,457
Goodwill                          6,399                  6,399
Intangible assets, net            31                     36
Long-term investments            716                    -
Long-term restricted Investments  300                    400
Other long-term assets            148                    288
Total assets                      $      40,908    $          
                                                           45,935
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
 Accounts payable              $         833  $          
                                                            1,785
 Accrued liabilities           3,591                  3,997
 Contract research liability   423                    483
 Deferred revenue, current     255                    662
portion
Total current liabilities         5,102                  6,927
Deferred revenue, noncurrent      1,487                  1,480
portion
Other long-term liabilities       791                    1,197
Stockholders' equity              33,528                 36,331
Total liabilities and             $      40,908    $          
stockholders' equity                                       45,935
(1) Derived from audited financial statements.

SOURCE DURECT Corporation

Website: http://www.durect.com
Contact: Matt Hogan, Chief Financial Officer, DURECT Corporation, 408-777-4936
 
Press spacebar to pause and continue. Press esc to stop.