pSivida Corp. Reports Fourth Quarter and Fiscal Year 2013 Results

  pSivida Corp. Reports Fourth Quarter and Fiscal Year 2013 Results

Business Wire

WATERTOWN, Mass. -- September 25, 2013

pSivida Corp. (NASDAQ: PSDV)(ASX: PVA), a leader in developing sustained
release, drug delivery products for treatment of back-of-the-eye diseases,
today announced financial results for its fourth quarter and fiscal year ended
June 30, 2013.

“In fiscal 2013, we made a major step forward in our transition to a Specialty
Pharma company with the start of the first of two planned pivotal Phase III
clinical trials for our own lead development product, the micro-insert
Medidur™ for posterior uveitis,” said Dr. Paul Ashton, President and CEO of
pSivida. “Uveitis is the third leading cause of blindness in the U.S. Because
Medidur uses the same micro-insert as ILUVIEN® , our partnered product for
diabetic macular edema (DME), the FDA has agreed that we can use much of the
data, including clinical safety data, from the completed ILUVIEN Phase III
trials to support an application for Medidur for posterior uveitis. This
should shorten and simplify the regulatory process.

“We also received encouraging interim results from a Phase I/II
investigator-sponsored study of Medidur for posterior uveitis. While early,
they were consistent with our hypothesis that Medidur should treat posterior
uveitis with an efficacy profile comparable to Retisert®, our FDA-approved
implant for uveitis that delivers the same drug as Medidur, and a side effect
profile superior to Retisert and comparable to ILUVIEN for DME.”

ILUVIEN for chronic DME considered insufficiently responsive to available
therapies, licensed to Alimera Sciences, is now being sold in Germany and the
U.K., and Alimera has reported its plans for a commercial launch in France in
early 2014. ILUVIEN for DME has also received marketing authorization in
Austria, Portugal and Spain, and has been recommended for marketing
authorization in Italy. In the U.S., the FDA is reviewing the New Drug
Application for ILUVIEN for DME resubmitted earlier this year and has set a
Prescription Drug User Fee Act (PDUFA) target date of October 17, 2013.
Approval in the U.S. would entitle pSivida to a $25 million milestone payment
from Alimera. pSivida is also entitled to 20% of net profits, as defined, from
sales of ILUVIEN by Alimera on a country-by-country basis.

Alimera has continued to advance pricing and reimbursement for ILUVIEN for DME
in the EU. In the U.K., where ILUVIEN is currently available only to privately
insured and private pay patients, the U.K.’s National Institute for Health and
Care Excellence (NICE) is considering the recommendation of its appraisal
committee to change published guidance to allow ILUVIEN for the treatment of
pseudophakic patients (those who have already undergone cataract replacement
surgery) with chronic DME. If adopted by NICE, the U.K.’s National Health
Service is expected to fund ILUVIEN treatment for this large subset of the
chronic DME population. In Germany, Alimera was permitted to launch ILUVIEN
for DME without price restriction and is in the process of securing agreements
for reimbursement with German statutory insurance funds to avoid individual
patient requests for reimbursement. In France, ILUVIEN for DME received a
favorable opinion for the reimbursement and hospital listing by the French
National Health Insurance of ILUVIEN,  and 100% of its cost will be reimbursed
under a program for severe chronic disease, such as diabetes.

“Pre-clinical testing of Tethadur™, our second key technology platform,
continues to progress well,” continued Dr. Ashton. “Tethadur offers the
potential to deliver peptides, proteins and antibodies on a sustained basis,
which would be very effective in the development of Biosimilars and
Biobetters. There is currently no sustained ophthalmic delivery technology
available for these biologics, which typically require frequent injection into
the eye.

"The use of Tethadur in certain ophthalmic applications is being evaluated
under a funded evaluation agreement with a leading global biopharmaceutical
company. Two other major pharmaceutical companies are evaluating our
technology platforms in other ophthalmic applications under funded
agreements.”

Revenues for the fiscal year ended June 30, 2013 totaled $2.1 million compared
to $3.5 million for the prior fiscal year. The decline in collaborative
research and development revenues principally reflected $1.1 million of
non-recurring revenue recognition in fiscal 2012 from termination of a license
agreement. Royalty income for fiscal 2013 reflected a small increase over the
prior fiscal year in royalties from sales of Retisert by Bausch & Lomb.

Net loss for fiscal 2013 was $11.9 million, or $0.52 per share, compared to a
net loss of $24.8 million, or $1.19 per share, for the prior fiscal year.
Fiscal 2012 results included a $14.8 million impairment charge for pSivida’s
finite-lived intangible assets arising from the November 2011 complete
response letter for ILUVIEN for DME and the resulting significant decrease in
pSivida’s market capitalization.

Revenues for the fiscal 2013 fourth quarter were $492,000 compared to $699,000
for the fourth quarter last year. The Company reported a net loss of $3.9
million, or $0.17 per share, for the fourth quarter ended June 30, 2013,
compared to a net loss of $2.3 million, or $0.11 per share, for the fourth
quarter of the prior year. The higher net loss in the fourth quarter of fiscal
2013 primarily reflected costs associated with the initiation of the Phase III
uveitis clinical trial and accruals for two years of incentive compensation,
as both fiscal 2012 and 2013 bonuses were earned based on fiscal 2013
performance conditions.

At June 30, 2013, cash, cash equivalents and marketable securities totaled
$10.3 million. In July 2013, the Company completed an underwritten public
offering of common shares for gross proceeds of approximately $10.8 million.

Today’s Conference Call Reminder

pSivida Corp. will host a live webcast and conference call today, September
25, 2013, at 4:30 pm ET. The conference call may be accessed by dialing (877)
312-7507 from the U.S. and Canada, or (631) 813-4828 from international
locations. The conference can also be accessed on the pSivida Corp. website at
www.psivida.com. A replay of the call will be available approximately two
hours following the end of the call through October 2, 2013. The replay may be
accessed by dialing (855) 859-2056 within the U.S. and Canada or (404)
537-3406 from international locations, Conference ID number 68809431.

About the Clinical Trials/Studies

pSivida has initiated the first of two planned pivotal Phase III trials of
Medidur for the treatment of posterior uveitis. These trials are expected to
enroll a total of approximately 300 patients. The primary end point is the
recurrence of uveitis within 12 months. pSivida will be permitted to reference
much of the data, including the clinical safety data, from the clinical trials
for ILUVIEN for DME conducted by Alimera.

The investigator-sponsored Phase I/II study of Medidur for posterior uveitis
is a three-year study that will evaluate the safety and efficacy of Medidur in
up to 12 patients with posterior uveitis. Interim results were measured on the
twelve month anniversary of the start of enrollment. Through this period, none
of the eyes receiving Medidur experienced a recurrence of uveitis and
inflammation was reduced in all of these eyes. In contrast, all (untreated)
control eyes had either a recurrence of uveitis or a worsening of
inflammation. Furthermore, at the last follow-up visit reported in interim
results, best corrected visual acuity (on the Early Treatment Diabetic
Retinopathy Study eye chart) improved by an average of more than nine letters
in treated eyes while untreated eyes declined by an average of one letter.
Interim data showed that Medidur was well tolerated, and the observed safety
profile was consistent with the short-term safety profile reported in clinical
studies of ILUVIEN in DME eyes. Only one eye receiving Medidur measured an
increase in intraocular pressure above the normal range.

About pSivida Corp.

pSivida Corp., headquartered in Watertown, MA, develops tiny, sustained
release, drug delivery products designed to deliver drugs at a controlled and
steady rate for months or years. pSivida is currently focused on treatment of
chronic diseases of the back of the eye utilizing its core technology systems,
Durasert™ and BioSilicon™, including Tethadur™. The injectable, sustained
release micro-insert ILUVIEN® for the treatment of chronic Diabetic Macular
Edema (DME) considered insufficiently responsive to available therapies,
licensed to Alimera Sciences, Inc., is marketed in the U.K. and Germany and
has also received marketing authorization in Austria, France, Portugal, and
Spain and is awaiting authorization in Italy. Alimera resubmitted the New Drug
Application for ILUVIEN for DME to the U.S. Food and Drug Administration and
received a PDUFA date of October 17, 2013. pSivida has instituted the first of
two planned pivotal Phase III clinical trials for Medidur™ for the treatment
of posterior uveitis, a chronic back-of-the-eye disease, using the same
micro-insert as ILUVIEN for DME. An investigator-sponsored clinical trial is
ongoing for an injectable, bioerodible micro-insert to treat glaucoma and
ocular hypertension, a product candidate on which Pfizer Inc. has an option.
pSivida's FDA-approved Retisert®, licensed to Bausch & Lomb Incorporated,
provides long-term, sustained drug delivery to treat posterior uveitis.

SAFE HARBOR STATEMENTS UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995: Various statements made in this release are forward-looking, and are
inherently subject to risks, uncertainties and potentially inaccurate
assumptions. All statements that address activities, events or developments
that we intend, expect or believe may occur in the future are forward-looking
statements. The following are some of the factors that could cause actual
results to differ materially from the anticipated results or other
expectations expressed, anticipated or implied in our forward-looking
statements: uncertainties with respect to: the ability to finance, complete
and achieve a successful outcome for Phase III trials for, and file and
achieve marketing approvals for, Medidur for posterior uveitis, including
efficacy, side effects and risk/benefit profile, as well as uncertainty as to
the ultimate results of the investigator-sponsored trial for Medidur for
posterior uveitis; Alimera’s ability to finance, achieve additional marketing
approvals, successfully complete pricing and reimbursement discussions for,
commercialize and achieve market acceptance of, and generate revenues to
pSivida from, ILUVIEN for DME in the EU; Alimera’s ability to obtain
regulatory approval for, and if approved, to finance, successfully
commercialize and achieve market acceptance of, and generate revenues to
pSivida from, ILUVIEN for DME in the U.S.; initiation, financing and success
of Latanoprost Product Phase II trials and exercise by Pfizer of its option;
ability to utilize Tethadur and BioSilicon to develop product candidates and
products and potential related collaborations; initiation and completion of
clinical trials and obtaining regulatory approval of product candidates;
continued sales of Retisert; adverse side effects; ability to attain
profitability; ability to obtain additional capital; further impairment of
intangible assets; fluctuations in operating results; decline in royalty
income; ability to, and to find partners to, develop and market products;
termination of license agreements; competition and other developments
affecting sales of products; market acceptance; protection of intellectual
property and avoiding intellectual property infringement; retention of key
personnel; product liability; consolidation in the pharmaceutical and
biotechnology industries; compliance with environmental laws; manufacturing
risks; risks and costs of international business operations; credit and
financial market conditions; legislative or regulatory changes; volatility of
stock price; possible dilution; possible influence by Pfizer; absence of
dividends; and other factors described in our filings with the SEC. Given
these uncertainties, readers are cautioned not to place undue reliance on such
forward-looking statements. Our forward-looking statements speak only as of
the dates on which they are made. We do not undertake any obligation to
publicly update or revise our forward-looking statements even if experience or
future changes makes it clear that any projected results expressed or implied
in such statements will not be realized.

Follow pSivida on social media:

Twitter: https://twitter.com/pSividaCorp

Facebook: https://www.facebook.com/pages/PSivida-Corp/544893792199562

LinkedIn: http://www.linkedin.com/company/psivida

Google+:
https://plus.google.com/u/0/b/113754643626984244726/113754643626984244726/posts

The President's Blog: http://www.thechairmansblog.com/paul-ashton

For more information on pSivida, visit www.psivida.com.




PSIVIDA CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands except per share amounts)
                                                           
                         Three Months Ended          Year Ended
                         June 30,                    June 30,
                                                                   
                         2013         2012           2013          2012
                                                                   
Revenues:
   Collaborative
   research and          $ 177        $ 257          $ 780         $ 2,080
   development
   Royalty income          315          442            1,363         1,446
                                                                
                                                                   
          Total           492        699          2,143       3,526   
          revenues
                                                                   
Operating expenses:
   Research and            2,320        1,410          7,005         7,039
   development
   General and             2,153        1,599          7,169         6,868
   administrative
   Impairment of           -            -              -             14,830
   intangible assets
                                                                
                                                                   
          Total
          operating       4,473      3,009        14,174      28,737  
          expenses
                                                                   
Operating loss            (3,981 )    (2,310 )      (12,031 )    (25,211 )
                                                                   
Other income
(expense):
   Change in fair
   value of                -            -              -             170
   derivatives
   Interest income         2            8              16            38
   Other expense, net      -            -              (2      )     (1      )
                                                                
                                                                   
          Total other     2          8            14          207     
          income
                                                                   
Loss before income         (3,979 )     (2,302 )       (12,017 )     (25,004 )
taxes
Income tax benefit         32           40             117           169
                                                                
                                                                   
                                                                   
Net loss                 $ (3,947 )   $ (2,262 )     $ (11,900 )   $ (24,835 )
                                                                   
Net loss per share:
   Basic and diluted     $ (0.17  )   $ (0.11  )     $ (0.52   )   $ (1.19   )
                                                                   
Weighted average
common shares
outstanding:
   Basic and diluted      23,297     20,803       23,044      20,791  
                                                                             
                                                                             
                                                                             

PSIVIDA CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
                                                             
                                                   June 30,       June 30,
                                                   2013           2012
                                                                  
Assets
Current assets:
  Cash, cash equivalents and marketable            $ 10,273       $ 14,571
  securities
  Other current assets                               2,191          1,388
                                                                 
                                                                  
Total current assets                                 12,464         15,959
Intangible assets, net                               3,430          4,226
Other assets                                         355            412
                                                                 
                                                                  
Total assets                                       $ 16,249      $ 20,597   
                                                                  
Liabilities and stockholders' equity
Current liabilities:
  Accounts payable and accrued expenses            $ 2,565        $ 1,002
  Deferred revenue                                   738            2,176
  Derivative liabilities                             -              -
                                                                 
                                                                  
Total current liabilities                            3,303          3,178
Deferred revenue                                     5,246          3,783
Deferred tax liabilities                             -              -
                                                                 
                                                                  
Total liabilities                                   8,549        6,961    
                                                                  
Stockholders' equity:
  Capital                                            270,438        264,452
  Accumulated deficit                                (263,658 )     (251,758 )
  Accumulated other comprehensive income             920            942
                                                                 
                                                                  
Total stockholders' equity                          7,700        13,636   
                                                                  
Total liabilities and stockholders' equity         $ 16,249      $ 20,597   

Contact:

In US:
Martin E. Janis & Company, Inc.
Beverly Jedynak
President
+1 312 943 1123
M: +1 773 350 5793
bjedynak@janispr.com
or
In Australia:
pSivida Corp.
Brian Leedman
Vice President, Investor Relations
+61 (0) 41 228 1780
brianl@psivida.com