PharmAthene Reports First Quarter 2013 Financial And Operational Results

   PharmAthene Reports First Quarter 2013 Financial And Operational Results

PR Newswire

ANNAPOLIS, Md., May 8, 2013

ANNAPOLIS, Md., May 8, 2013 /PRNewswire/ --PharmAthene, Inc. (NYSE MKT: PIP),
a biodefense company developing medical countermeasures against biological ^
and chemical threats, today reported its financial and operational results for
the first quarter of 2013.

"We made steady progress in our biodefense programs this quarter," said Eric
I. Richman, President and Chief Executive Officer. "We submitted to the U.S.
Food and Drug Administration (FDA) our complete response to the SparVax^®
clinical hold notification and look forward to moving ahead soon.

"Regarding our chemical and nerve agent bioscavenger program, testing
conducted by the U.S. Army Research Institute for Chemical Defense showed that
our recombinant bioscavenger successfully targets and binds to a broad
spectrum of nerve agents, including sarin and tabun. These agents are
believed to be part of the Syrian chemical weapons inventory. If successful,
we believe that our recombinant bioscavenger could provide a more
cost-effective solution to address the threat of chemical weapons."

Linda L. Chang, Senior Vice President and Chief Financial Officer, commented,
"We are off to a good start in 2013 meeting our financial objectives,
including achieving neutral to slightly positive cash flow in the first
quarter. For the year, we anticipate relatively low cash usage overall,
consistent with the capital-efficient nature of our government contracting
business model."

Additionally, oral arguments on the appeal of the May 2012 Delaware Court of
Chancery final order and judgment, awarding PharmAthene a significant economic
interest in SIGA Technologies' smallpox antiviral, Arestvyr™, were heard in
the Delaware Supreme Court in the first quarter. The Company anticipates a
ruling by the Supreme Court on the appeal could occur by the end of the second

First Quarter 2013 Financial Results


For the first quarter of 2013, PharmAthene recognized revenue of $6.5 million,
compared to $6.1 million for the same period in 2012. Revenue in the first
quarter of 2013 was derived from development contracts with the U.S.
government for the Company's biodefense product candidates.

Revenue for the SparVax^® program in the first quarter of 2013 was $5.1
million compared to $5.2 million in the first quarter of 2012. Revenue for the
rBChE bioscavenger program in the first quarter of 2013 was approximately $1.4
million compared to $0.8 million for the same period in 2012.

Operating Expenses

Research and development expenses were $5.2 million in the first quarter of
2013, compared to $4.7 million in the first quarter of 2012. Research and
development expenses increased as a result of increased costs related to the
SparVax^® and rBChE bioscavenger programs.

Expenses associated with general and administrative functions were $2.3
million in the first quarter of 2013 compared to $2.9 million in the first
quarter of 2012. The decrease in general and administrative expenses in the
first quarter was due primarily to reduced labor costs and professional and
consulting fees.

Net Loss

For the first quarter of 2013, PharmAthene's net loss was $2.1 million, or
$0.04 per share, compared to a net loss of $2.7 million, or $0.06 per share
during the same period in 2012. The decrease in net loss is primarily due to
increased revenue and lower overall operating expenses.

Cash, Cash Equivalents and Accounts Receivable

As of March 31, 2013, the Company had cash and cash equivalents totaling
approximately $12.9 million, compared to $12.7 million as of December 31,
2012. U.S. government billed and unbilled accounts receivable totaled
approximately $5.6 million at March 31, 2013 compared to $6.5 million at
December 31, 2012. The sum total of cash and cash equivalents and U.S.
government accounts receivable at March 31, 2013 was approximately $18.5
million, compared to $19.2 million as of December 31, 2012.

Conference Call and Webcast Information

PharmAthene management will be hosting a conference call to discuss the
Company's first quarter 2013 financial and operational results. The call is
scheduled to begin at 4:30 pm Eastern Time on Wednesday, May 8, 2013 and is
expected to last approximately 30 minutes. The dial-in number within the
United States is 866-515-2915. The dial-in number for international callers
is 617-399-5129. The participant passcode is 78016828.

A replay of the conference call will be available beginning at approximately
6:30 pm Eastern Time on May 8, 2013 until approximately 11:59 p.m. Eastern
Time on June 7, 2013. The dial-in number to access the replay from within the
United States is 888-286-8010. For international callers, the dial-in number
is 617-801-6888. The participant passcode is 70157811.

The conference call will also be webcast and can be accessed from the
Company's website at A link to the webcast may be found
under the Investor Relations section of the website.

About PharmAthene

PharmAthene was formed to meet the critical needs of the United States and its
allies by developing and commercializing medical countermeasures against
biological and chemical threats. PharmAthene's current biodefense portfolio
includes the following product candidates:

  oSparVax^® - a next generation recombinant protective antigen (rPA) anthrax
  oRecombinant BChE - a novel bioscavenger for the prevention and treatment
    of morbidity and mortality associated with exposure to chemical nerve
  oValortim^® - a fully human monoclonal antibody for the prevention and
    treatment of anthrax infection

In addition, pursuant to a final judgment issued May 31, 2012 from the
Delaware Court of Chancery, PharmAthene is entitled to 50% of the net profits
(as defined in the Court's final judgment) over 10 years from all sales of
SIGA Technologies' Arestvyr™, a novel smallpox antiviral agent being developed
by SIGA for the treatment and prevention of morbidity and mortality associated
with exposure to the causative agent of smallpox, and related products, once
SIGA receives the first $40 million in net profits from sales of Arestvyr™.
Both parties have appealed aspects of this ruling to the Delaware Supreme
Court, which was argued before the Delaware Supreme Court in January 2013. For
more information about PharmAthene, please visit

Statement on Cautionary Factors

Except for the historical information presented herein, matters discussed may
constitute forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995 that are subject to certain risks and
uncertainties that could cause actual results to differ materially from any
future results, performance or achievements expressed or implied by such
statements. Statements that are not historical facts, including statements
preceded by, followed by, or that include the words "potential"; "believe";
"anticipate"; "intend"; "plan"; "expect"; "estimate"; "could"; "may";
"should"; "will"; "project"; "potential"; or similar statements are
forward-looking statements. PharmAthene disclaims any intent or obligation to
update these forward-looking statements other than as required by law. Risks
and uncertainties include risk associated with our interest in Arestvyr™, the
reliability of the results of the studies relating to human safety and
possible adverse effects resulting from the administration of the Company's
product candidates, unexpected funding delays and/or reductions or elimination
of U.S. government funding for one or more of the Company's development
programs, the award of government contracts to our competitors, unforeseen
safety issues, challenges related to the development, scale-up, technology
transfer, and/or process validation of manufacturing processes for our product
candidates, unexpected determinations that these product candidates prove not
to be effective and/or capable of being marketed as products, as well as risks
detailed from time to time in PharmAthene's Forms 10-K and 10-Q under the
caption "Risk Factors" and in its other reports filed with the U.S. Securities
and Exchange Commission (the "SEC"). In particular, there is significant
uncertainty regarding the level and timing of sales of Arestvyr™ and when and
whether it will be approved by the U.S. FDA and corresponding health agencies
around the world. We cannot predict with certainty if or when SIGA will begin
recognizing profit on the sale thereof and there can be no assurance that any
profits received by SIGA and paid to us will be significant. Furthermore, SIGA
has filed an appeal with the Delaware Supreme Court challenging aspects of the
Court of Chancery decision, and there can be no assurances that the decision
will not be reversed or that the remedy will not otherwise be modified. In
addition, we cannot predict how long the appeal will delay the receipt of
payments, if any, from SIGA. Further, significant additional non-clinical
animal studies, human clinical trials, and manufacturing development work
remain to be completed for all of ourproduct candidates. Copies of
PharmAthene's public disclosure filings are available from its investor
relations department and our website under the investor relations tab at

-- Tables Follow --

                                          March 31,
                                          2013              December 31, 2012
Current assets:
 Cash and cash equivalents               $ 12,873,411      $  12,701,517
 Accounts receivable (billed)              1,865,916          2,432,641
 Unbilled accounts receivable              3,713,797          4,114,442
 Prepaid expenses and other current        614,388            547,245
Total current assets                        19,067,512         19,795,845
Property and equipment, net                 456,842            483,976
Other long-term assets and deferred         99,578             113,130
Goodwill                                    2,348,453          2,348,453
Total assets                              $ 21,972,385      $  22,741,404
Current liabilities:
 Accounts payable                        $ 1,289,627       $  1,697,280
 Accrued expenses and other liabilities    3,294,315          2,328,877
 Deferred revenue                          874,404            1,381,755
 Current portion of long-term debt         999,996            749,997
 Short-term debt                           1,329,233          1,330,507
Total current liabilities                   7,787,575          7,488,416
Other long-term liabilities                 580,238            579,427
Long-term debt, less current portion        1,460,417          1,704,108
Derivative instruments                      2,201,390          1,295,613
Total liabilities                           12,029,620         11,067,564
Stockholders' equity:
Common stock, $0.0001 par value;
100,000,000 shares authorized;

48,416,483 and 48,352,651 shares issued     4,842              4,835
and outstanding at March 31, 2013

and December 31, 2012, respectively
 Additional paid-in-capital                210,877,892        210,495,905
 Accumulated other comprehensive loss      (219,012)          (217,328)
 Accumulated deficit                       (200,720,957)      (198,609,572)
Total stockholders'equity                 9,942,765          11,673,840
Total liabilities and stockholders'       $ 21,972,385      $  22,741,404

                                                2013            2012
Contract revenue                                $ 6,475,138     $ 6,149,052
Operating expenses:
Research and development                          5,233,475       4,705,357
General and administrative                        2,279,795       2,948,481
Depreciation and amortization                     52,602          85,910
Total operating expenses                          7,565,872       7,739,748
Loss from operations                              (1,090,734)     (1,590,696)
Other income (expense):
Interest income                                   783             2,988
Interest expense                                  (99,791)        (3,028)
Other income (expense)                            (6,123)         52,915
Change in fair value of derivative instruments    (905,777)       (991,662)
Total other income (expense)                      (1,010,908)     (938,787)
Net loss before income taxes                      (2,101,642)     (2,529,483)
Income tax expense                               (9,743)         (150,405)
Net loss                                       $ (2,111,385)   $ (2,679,888)
Basic and diluted net loss per share            $ (0.04)        $ (0.06)
Weighted average shares used in calculation of
                                                  48,359,181      48,269,894
basic and diluted net loss per share

SOURCE PharmAthene, Inc.

Contact: Stacey Jurchison, PharmAthene, Inc., Phone: (410) 269-2610,