Synergy Pharmaceuticals Reports First Quarter 2014 Financial Results: Cash and Investments Increase to $70.6 million as of March

  Synergy Pharmaceuticals Reports First Quarter 2014 Financial Results: Cash
  and Investments Increase to $70.6 million as of March 31, 2014

Business Wire

NEW YORK -- May 13, 2014

Synergy Pharmaceuticals Inc. (Nasdaq:SGYP), a developer of new drugs to treat
gastrointestinal diseases and disorders, today reported its financial results
and business update for the first quarter ended March 31, 2014. Synergy is
developing plecanatide for the treatment of both chronic idiopathic
constipation (CIC) and irritable bowel syndrome with constipation (IBS-C),
plus SP-333 for opioid-induced constipation (OIC).

Recent Developments

  *On April 30, 2014, Synergy announced positive top-line results from a
    phase 2b dose-ranging study assessing plecanatide’s safety and efficacy in
    424 patients with IBS-C. The primary objective of this trial was to
    determine an effective, safe and well tolerated dose for plecanatide phase
    3 trials with IBS-C patients. Preliminary analysis of the data indicates
    plecanatide 1.0, 3.0 and 9.0 mg doses demonstrated statistically
    significant improvement in complete spontaneous bowel movement (CSBM)
    frequency – the study’s primary endpoint – and was safe and well tolerated
    at all doses. Notably, patients taking the plecanatide 3.0 mg dose
    consistently experienced statistically significant improvement in
    important secondary endpoints such as change from baseline versus placebo
    in worst abdominal pain and the FDA overall responder endpoint for IBS-C
    over the 12-week treatment. Patients in the plecanatide 3.0 mg dose group
    also experienced a less than 10% diarrhea rate. Once full analysis of the
    data is complete, Synergy plans to present complete results of the trial
    at an appropriate scientific conference this fall. The company intends to
    initiate pivotal phase 3 trials with IBS-C patients in the second half of
    2014.
  *From January1, 2014 through February27, 2014, Synergy sold 3,644,143
    shares of common stock in the open market for gross proceeds of
    approximately $21.2 million, at an average selling price of $5.82 per
    share. This completed the Company’s original $30 million of proposed sales
    of common stock pursuant to the June 21, 2012 Controlled Equity Offering
    Sales Agreement, or ATM facility, with Cantor Fitzgerald & Co.(Cantor).
  *On March5, 2014, Synergy entered into Amendment No.1 to its Controlled
    Equity Offering Sales Agreement with Cantor (the Amendment), pursuant to
    which the Company may offer and sell additional shares of its common
    stock, up to an additional aggregate offering price of $50.0 million.From
    March 5, 2014 through March 31, 2014, Synergy sold 228,249 shares of
    common stock, for gross proceeds of $1.4 million, at an average selling
    price of $6.08 per share, under the Amendment. As of May 9, 2014 Synergy
    had $48.6 million available unsold under this ATM facility.

“We are pleased to report that the $22.6 million raised through our ATM
facility with Cantor during the quarter, at favorable per share pricing, has
strengthened our balance sheet considerably, as we now prepare to successfully
execute on our Phase 3 IBS-C clinical program.” said Bernard Denoyer, Senior
Vice President, Finance.

Synergy's cash, cash equivalents and available-for-sale securities balance as
of March 31, 2014 was $70.6 million as compared to $68.1 million on December
31, 2013. During the three months ended March 31, 2014, net cash provided by
financing activities was $22.0 million, as compared to $4.6 million during the
three months ended March 31, 2013. Net cash used in operating activities was
$19.9 million during the three months ended March 31, 2014, as compared to
$15.6 million during the three months ended March 31, 2013.

Net loss for the three months ended March 31, 2014 was $16.2 million or $0.18
per share, as compared to a net loss of $18.7 million, or $0.26 per share, for
the quarter ended March 31, 2013. During the three months ended March 31,
2014, non-cash expense items, principally a change in fair value of derivative
instruments and stock based compensation expense, totaled approximately $1
million or $0.01 per share, whereas such items in the three months ended March
31, 2013 totaled $2.4 million, or $0.03 per share.

Synergy had approximately 94.1 million common shares issued and outstanding at
March 31, 2014.

About Synergy Pharmaceuticals Inc.

Synergy Pharmaceuticals Inc. is a biotechnology company focused on the
research and development of novel therapies based on the natural human
hormone, uroguanylin, for the treatment of gastrointestinal (GI) diseases and
disorders. Uroguanylin is a natural hormone produced by humans in the small
intestine and plays a key role in regulating the normal functioning of the
digestive tract through its activity on the guanylate cyclase-C (GC-C)
receptor. The GC-C receptor is known to be a primary source for stimulating a
variety of beneficial physiological responses. Synergy has created two unique
analogs of uroguanylin – plecanatide and SP-333 – designed to mimic the
natural hormone’s activity on the GC-C receptor and target a variety of GI
conditions. Plecanatide is in two pivotal phase 3 clinical trials for chronic
idiopathic constipation and has successfully completed a phase 2b study for
irritable bowel syndrome with constipation. SP-333 is in phase 2 development
for opioid-induced constipation and is also being explored for ulcerative
colitis. For more information, please visit www.synergypharma.com.

Forward-Looking Statements

Certain statements in this press release are forward-looking within the
meaning of the Private Securities Litigation Reform Act of 1995. These
statements may be identified by the use of forward-looking words such as
"anticipate," "planned," "believe," "forecast," "estimated," "expected," and
"intend," among others. These forward-looking statements are based on
Synergy's current expectations and actual results could differ materially.
There are a number of factors that could cause actual events to differ
materially from those indicated by such forward-looking statements. These
factors include, but are not limited to, substantial competition; our ability
to continue as a going concern; our need for additional financing;
uncertainties of patent protection and litigation; uncertainties of government
or third party payer reimbursement; limited sales and marketing efforts and
dependence upon third parties; and risks related to failure to obtain FDA
clearances or approvals and noncompliance with FDA regulations. As with any
pharmaceutical under development, there are significant risks in the
development, regulatory approval and commercialization of new products. There
are no guarantees that future clinical trials discussed in this press release
will be completed or successful or that any product will receive regulatory
approval for any indication or prove to be commercially successful. Investors
should read the risk factors set forth in Synergy's Form 10-K for the year
ended December 31, 2013 and other periodic reports filed with the Securities
and Exchange Commission. While the list of factors presented here is
considered representative, no such list should be considered to be a complete
statement of all potential risks and uncertainties. Unlisted factors may
present significant additional obstacles to the realization of forward-looking
statements. Forward-looking statements included herein are made as of the date
hereof, and Synergy does not undertake any obligation to update publicly such
statements to reflect subsequent events or circumstances; and thus you should
not unduly rely on these statements.

                                                          
Condensed Consolidated Balance Sheets

($ in thousands)
                                                             
                                            March 31, 2014   December 31, 2013
                                            (unaudited)
Assets
Cash, cash equivalents and short term
available                                   $   70,638       $    68,157

for sale securities
Prepaid expenses and other current assets      5,578           3,718
Total Current Assets                            76,216            71,875
Property and equipment, net                     589               589
Security deposits                              94              94
Total Assets                                $   76,899      $    72,558
Liabilities and Stockholders' Equity
Accounts payable                            $   9,931        $    13,542
Accrued expenses                               2,663           2,134
Total Current Liabilities                       12,594            15,676
Derivative financial instruments               1,311           1,534
–warrants
Total Liabilities                               13,905            17,210
Common stock                                    10                10
Additional paid-in capital                      250,386           226,515
Deficit accumulated during development         (187,402)       (171,177)
stage
Total Stockholders' Equity                     62,994          55,348
Total Liabilities and Stockholders'         $   76,899      $    72,558
Equity
                                                             

                                                         
Condensed Consolidated Statement of
Operations
($ in thousands except share and per
share data)



(unaudited)
                                      Three Months ended   Three Months ended
                                       March 31, 2014       March 31, 2013
                                                            
Revenues                               $    --              $    --
Costs and Expenses:
Research and development                    13,299               14,344
General and administrative                 3,178              3,278
Loss from Operations                       (16,477)           (17,622)
Interest and investment income              58                   18
Other income/(expense)                      (29)                 -
Change in Fair Value of Financial          223                (1,093)
Instruments
Total Other Income/(Loss)                  252                (1,075)
Net Loss                               $    (16,225)       $    (18,697)
                                                            
Net Loss per common share, basic and   $    (0.18)         $    (0.26)
diluted
Weighted Average Common Shares             92,056,124         72,789,006
Outstanding
                                                            

Contact:

Synergy Pharmaceuticals Inc.
Media
Gem Gokmen
Office: 212-584-7610
Mobile: 646-637-3208
ggokmen@synergypharma.com
or
Investors
Bernard Denoyer
Office: 212-297-0020
Mobile: 203-300-8147
bdenoyer@synergypharma.com
 
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