Transcept Pharmaceuticals Reports First Quarter 2014 Financial Results

    Transcept Pharmaceuticals Reports First Quarter 2014 Financial Results

PR Newswire

POINT RICHMOND, Calif., May 5, 2014

POINT RICHMOND, Calif., May 5, 2014 /PRNewswire/ -- Transcept Pharmaceuticals,
Inc. (Nasdaq: TSPT), a specialty pharmaceutical company focused on the
development and commercialization of proprietary products that address
important therapeutic needs in the field of neuroscience, today announced
financial results for the three months ended March31, 2014.

Transcept reported cash, cash equivalents and marketable securities of $69.8
million at March31, 2014.

"We continue to explore a range of alternatives to enhance stockholder value,
including business combination and/or partnership opportunities, as well as a
distribution of a significant amount of cash to stockholders," said Glenn A.
Oclassen, Transcept Chairman and CEO. "We have significantly reduced our cash
burn while making progress in these initiatives. We have identified, and are
actively evaluating several opportunities together with our strategic and
financial advisor, Leerink Swann, LLC. All of the opportunities under review
contemplate a distribution of cash to stockholders no later than concurrent
with the transaction. We believe it is in our stockholders' best interest to
continue to postpone a dissolution of the Company to allow us sufficient
opportunity to pursue and consummate such transactions, particularly in light
of the cost and extended time period inherent in the dissolution process. We
look forward to further updating our stockholders as these initiatives
progress."

Three months ended March 31, 2014 financial results

For the quarter ended March31, 2014 and 2013, Transcept recorded $0.4 million
and $0.5 million, respectively, of royalty revenue on Intermezzo net sales
generated by Purdue. The 2013 royalty revenue was offset by $6.3 million
related to a contribution by Transcept in December 2012 to an Intermezzo
direct-to-consumer (DTC) advertising campaign led by Purdue. Transcept
recognized this contribution as an offset against revenue as the advertising
costs were incurred. This contribution resulted in negative net revenue of
$5.8 million for the quarter ended March31, 2013 as compared to net revenue
of $0.4 million for the quarter ended March31, 2014.

Research and development expense for the quarter ended March31, 2014 was
approximately $0.7 million, compared to approximately $1.8 million for the
same period in 2013. The decrease of approximately $1.1 million was primarily
attributable to reductions in our research and development operations,
including significant reductions in staff. Research and development expense
included non-cash stock compensation expense of approximately $0.1 million for
the quarter ended March31, 2014 and approximately $0.2 million for the
quarter ended March31, 2013.

General and administrative expense for the quarter ended March31, 2014 was
approximately $2.5 million compared to approximately $2.8 million for the same
period in 2013. The decrease of approximately $0.3 million consists of
significant reductions in staffing partially offset by increased professional
fees, primarily associated with ANDA patent litigation. General and
administrative expense included non-cash stock compensation expense of
approximately $0.4 million for the quarter ended March31, 2014, compared to
approximately $0.6 million for the quarter ended March31, 2013.

Net loss for the quarter ended March31, 2014 was approximately $2.8 million,
or $0.15 per share (basic and diluted), compared to net loss of approximately
$10.5 million, or $0.56 per share (basic and diluted), for the quarter ended
March31, 2013. The decrease in net loss of $7.7 million was primarily due to
the Transcept participation in the 2013 DTC campaign led by Purdue. The
weighted average shares used to calculate basic and diluted net loss per share
were 18,842,610 and 18,703,413 for the quarters ended March31, 2014 and
March31, 2013, respectively. At March31, 2014, there were 18,842,888 common
shares outstanding and 4,204,082 common shares underlying outstanding options
and warrants.

About Transcept

Transcept Pharmaceuticals, Inc. is a specialty pharmaceutical company focused
on the development and commercialization of proprietary products that address
important therapeutic needs in the field of neuroscience. The Company's lead
development candidate is TO-2070, a novel rapidly absorbed treatment for acute
migraine incorporating dihydroergotamine (DHE) as the active drug, which
Transcept is developing through the completion of preclinical safety studies,
but has not initiated a Phase 1 human pharmacokinetic study. Preclinical data
suggest that TO-2070 may offer significant migraine treatment benefits beyond
those provided by less convenient and more invasive DHE drug delivery methods,
such as injection, liquid nasal sprays or pulmonary inhalation.

The Transcept management team developed Intermezzo^® from concept to its
approval by the FDA in 2011. Purdue holds commercialization and development
rights for Intermezzo in the United States. For further information about
Transcept, please visit www.transcept.com. For information about Intermezzo,
please visit www.MyIntermezzo.com.

Forward looking statements

This press release contains forward-looking statements that involve
substantial risks and uncertainties. All statements, other than statements of
historical facts, included in this press release regarding our strategy,
future operations, future financial position, future revenue, projected
expenses, prospects, plans and objectives of management are forward-looking
statements. Examples of such statements include, but are not limited to,
statements relating to Purdue's plans to commercialize Intermezzo, including
our collaboration with Purdue; our plans and expectations regarding our
strategic process, including the possible dissolution of Transcept and the
possibility of a return of cash to our stockholders. Transcept may not
actually achieve the plans, carry out the intentions or meet the expectations
or projections disclosed in our forward-looking statements and you should not
place undue reliance on these forward-looking statements. Actual results or
events could differ materially from the plans, intentions, expectations and
projections disclosed in the forward-looking statements. Various important
factors could cause actual results or events to differ materially from the
forward-looking statements that Transcept makes, including the risks described
in the "Risk Factors" section of Transcept periodic reports filed with the
SEC. Forward-looking statements do not reflect the potential impact of any
future in-licensing, collaborations, acquisitions, mergers, dispositions,
joint ventures, or investments Transcept may enter into or make. Transcept
does not assume any obligation to update any forward-looking statements,
except as required by law.

Contact:
Transcept Pharmaceuticals, Inc.
Leone Patterson
Vice President, Chief Financial Officer
(510) 215-3500
lpatterson@transcept.com

FINANCIAL TABLES FOLLOW





Transcept Pharmaceuticals, Inc.

Condensed Consolidated Statements of Operations

(in thousands, except per share data)

(unaudited)
                                                         Three Months Ended
                                                         March 31,
                                                         2014       2013
Revenue:
 Gross royalty revenue                                 $ 418      $ 482
 Advertising expense - Purdue Pharma                   —          (6,312)
Net revenue                                              418        (5,830)
Operating expenses:
Research and development                                708        1,843
General and administrative                              2,496      2,802
Total operating expenses                                 3,204      4,645
Loss from operations                                     (2,786)    (10,475)
Interest and other income (expense), net                 (18)       (25)
Net loss                                                 $ (2,804)  $ (10,500)
Basic and diluted net loss per share                     $ (0.15)   $ (0.56)
Weighted average shares outstanding                      18,843     18,703
Other comprehensive loss:
Changes in unrealized gain (loss) on marketable         (2)        —
securities
Comprehensive loss                                       $ (2,806)  $ (10,500)





Transcept Pharmaceuticals, Inc.

Condensed Consolidated Balance Sheets

(in thousands)
                                             March 31, 2014  December 31, 2013
                                             (unaudited)
Assets
Current assets:
 Cash and cash equivalents                 $    21,361     $      9,935
 Marketable securities                     48,460          60,110
 Other current assets                      1,545           3,582
Total current assets                         71,366          73,627
Property and equipment, net                  24              43
Total assets                                 $    71,390     $      73,670
Liabilities and stockholders' equity
Total current liabilities                    $    1,936      $      1,928
Stockholders' equity:
 Common stock and additional paid in       211,794         211,276
capital
 Accumulated deficit                       (142,360)       (139,556)
 Accumulated other comprehensive income    20              22
Total stockholders' equity                   69,454          71,742
Total liabilities and stockholders' equity   $    71,390     $      73,670



SOURCE Transcept Pharmaceuticals, Inc.

Website: http://www.transcept.com
 
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