Cyclacel Pharmaceuticals Announces Third Quarter 2009 Financial Results

Conference Call Scheduled Tuesday, November 3 at 4:30 p.m. Eastern

• Press Release
• Source: Cyclacel Pharmaceuticals, Inc.
• On 4:01 pm EST, Tuesday November 3, 2009

BERKELEY HEIGHTS, N.J., Nov. 3, 2009 (GLOBE NEWSWIRE) -- Cyclacel Pharmaceuticals, Inc. (Nasdaq:CYCC - News) (Nasdaq:CYCCP - News) ("Cyclacel" or the "Company") announced today financial and operating results for the third quarter of 2009. The Company's net loss for the quarter was $3.1 million or $0.13 per share. This compared to a net loss of $17.6 million or $0.86 loss per share for the same period in 2008. As of September 30, 2009, the Company had $14.4 million in cash and cash equivalents.

Related Quotes

Symbol	Price	Change
CYCC	0.80	0.00

{"s" : "cycc,cyccp","k" : "c10,l10,p20,t10","o" : "","j" : ""}

"Our recent achievement of 30% one-year survival in two of the three randomized schedules of the Phase 2 study of sapacitabine as a treatment for elderly patients aged 70 and older with acute myeloid leukemia (AML) provides a strong rationale supporting the continued development of this novel agent," said Spiro Rombotis, President and Chief Executive Officer of Cyclacel. "We are working with the FDA to design a registration study for sapacitabine in hematological malignancies. We continue to concentrate our efforts on advancing sapacitabine into Phase 3 development for AML and/or myelodysplastic syndromes (MDS) while preserving cash for the next twelve months. We are also looking forward to reporting in 2010 data from our ongoing Phase 2 studies of sapacitabine and seliciclib in lung cancer."

Recent Highlights:

  --  Reported 30% one-year survival from the Phase 2 sapacitabine
      trial in elderly patients with AML aged 70 and older in two
      out of three randomized schedules;
  --  Type A meeting granted by the FDA in the 4th quarter of 2009
      to discuss the design of Phase 3 registration studies in AML
      and/or MDS;
  --  Phase 3 study designs to be included in an upcoming submission
      requesting a Special Protocol Assessment or SPA;
  --  Raised $3.4 million in gross proceeds in a registered direct
      offering in July.

Key Financials:

Total revenues for the third quarter of 2009 were $0.2 million representing a decrease of 14% compared to $0.3 million for the same period in 2008. These revenues were mainly attributable to sales of the Xclair(r) and Numoisyn(r) products.

Total research and development (R&D) expenses in the third quarter of 2009 were $1.4 million, a 65% decrease as compared to $4.0 million in the third quarter of 2008. $1.6 million of the overall decrease was associated with the discontinuation of the Company's preclinical programs from the cost-containment measures implemented in September 2008 and June 2009. The Company recognized cost reductions of approximately $1.0 million in the third quarter 2009 as compared to the same period in 2008 due to the completion of patient enrollment in the APPRAISE trial in the third quarter of 2008.

Total selling, general and administrative expenses (SG&A) for the third quarter of 2009 were $2.2 million, a 32% decrease as compared to $3.2 million in the third quarter of 2008. The reduction in operating expenses in the third quarter of 2009 compared to the same period in 2008 is primarily attributable to the cost-containment measures implemented in September 2008 and June 2009 and the concentration of the Company's resources on the clinical development of sapacitabine.

Other operating expenses in the third quarter of 2008 also included a non-cash charge of $6.8 million for goodwill and intangibles impairment in respect of the acquisitions of Xcyte Therapies, Inc. and ALIGN following Cyclacel's annual test for impairment and restructuring costs.

Other income (expense) showed income of $0.2 million in the third quarter of 2009 as compared to expense of $4.1 million in the third quarter of 2008. The decrease in expense was primarily due to an unrealized foreign exchange loss of $4.8 million in the third quarter of 2008 compared to a $0.1 million foreign exchange gain in the same period in 2009 arising from intercompany loans with our wholly-owned subsidiaries due to the translation effects of the U.S. dollar against the British pound together with a change in the valuation of warrants and a reduction in interest income earned.

The net loss in the third quarter of 2009 was $3.1 million or $0.13 per share as compared to $17.6 million in the third quarter of 2008 or $0.86 per share.

Cyclacel also reported results of its operations for the nine months ended September 30, 2009. Total revenues for the nine months ended September 30, 2009 were $0.7 million representing an increase of 16% compared to $0.6 million for the same period in 2008. These revenues were mainly attributable to sales of the Xclair(R) and Numoisyn(R) products.

For the nine months ended September 30, 2009, R&D expenses were $7.2 million, a 54% decrease as compared to $15.7 million in the comparable period in 2008.

For the nine months ended September 30, 2009, SG&A expenses were $6.7 million, a 41% decrease as compared to $11.3 million in the comparable period in 2008.

The reduction in operating expenses in 2009 compared to 2008 is primarily attributable to the cost-containment measures implemented in September 2008 and June 2009 and the concentration of the Company's resources on the clinical development of sapacitabine.

Other operating expenses for the nine months ended September 30 2008 also included a non-cash charge of $6.8 million for goodwill and intangibles impairment in respect of the acquisitions of Xcyte and ALIGN and restructuring costs. For the nine months ended September 30, 2009, the Company recorded restructuring costs of $0.4 million.

Other income (expense) for the nine months ended September 30, 2009 showed an expense of $2.0 million as compared to $0.4 million for the same period in 2008. The 2009 loss included a non-operating expense of $1.7 million related to payments due under an agreement with Scottish Enterprise as a consequence of the headcount reductions implemented by the Company. During 2008, the Company recorded a charge of $3.3 million associated with the warrant derivative as compared to income of $0.2 million in 2009 as a result of the Company's common stock price at each quarter end. The decrease in expense was primarily due to unrealized foreign exchange loss of $4.6 million in the nine months ended September 30, 2008 compared to $0.1 million foreign exchange loss in the same period in 2009 arising mostly from intercompany loans with our wholly-owned subsidiaries due to the translation effects of the U.S. dollar against the British pound.

For the nine months ended September 30, 2009, the Company reported a net loss of $15.2 million or $0.71 per share, compared to a net loss for the same period in 2008 of $32.4 million or $1.59 per share.

Conference call and Webcast Information:

Cyclacel management will conduct a conference call on November 3, 2009 at 4:30 p.m. Eastern Time to review the quarterly results. Conference call and webcast details are as follows:

Conference call information:

U.S./Canada call: (877) 493-9121/ international call: (973) 582-2750 U.S./Canada archive: (800) 642-1687 / international archive: (706) 645-9291

Code for live and archived conference call is 37927625

For the live and archived webcast, please visit the Corporate Presentations page on the Cyclacel website at www.cyclacel.com. The webcast will be archived for 90 days and the audio replay for 7 days.

About Cyclacel Pharmaceuticals, Inc.

Cyclacel is a diversified biopharmaceutical company dedicated to the discovery, development and commercialization of novel, mechanism-targeted drugs to treat human cancers and other serious disorders. Sapacitabine, a cell cycle modulating nucleoside analog, is in Phase 2 studies for the treatment of acute myeloid leukemia in the elderly, myelodysplastic syndromes and lung cancer and in Phase 1 in combination with seliciclib. Seliciclib, a CDK (cyclin dependent kinase) inhibitor, is in Phase 2 for the treatment of lung and nasopharyngeal cancer. CYC116, an Aurora kinase and VEGFR2 inhibitor, is in Phase 1 in patients with solid tumors. Cyclacel's ALIGN Pharmaceuticals subsidiary markets directly in the U.S. Xclair(R) Cream for radiation dermatitis, Numoisyn(R) Liquid and Numoisyn(R) Lozenges for xerostomia. Cyclacel's strategy is to build a diversified biopharmaceutical business focused in hematology and oncology based on a portfolio of commercial products and a development pipeline of novel drug candidates. Please visit www.cyclacel.com for additional information.

Risk factors

This news release contains certain forward-looking statements that involve risks and uncertainties that could cause actual results to be materially different from historical results or from any future results expressed or implied by such forward-looking statements. Such forward-looking statements include statements regarding, among other things, the efficacy, safety, and intended utilization of Cyclacel's product candidates, the conduct and results of future clinical trials, plans regarding regulatory filings, future research and clinical trials and plans regarding partnering activities. Factors that may cause actual results to differ materially include the risk that product candidates that appeared promising in early research and clinical trials do not demonstrate safety and/or efficacy in larger-scale or later clinical trials, the risk that Cyclacel will not obtain approval to market its products, the risks associated with reliance on outside financing to meet capital requirements, and the risks associated with reliance on collaborative partners for further clinical trials, development and commercialization of product candidates. You are urged to consider statements that include the words "may," "will," "would," "could," "should," "believes," "estimates," "projects," "potential," "expects," "plans," "anticipates," "intends," "continues," "forecast," "designed," "goal," or the negative of those words or other comparable words to be uncertain and forward-looking. These factors and others are more fully discussed under "Risk Factors" in the Annual Report on Form 10-K for the year ended December 31, 2008, as supplemented by the interim quarterly reports, filed with the SEC.

The Cyclacel logo and Cyclacel(R) are trademarks of Cyclacel Pharmaceuticals, Inc. Numoisyn(R) and Xclair(R) are trademarks of Sinclair Pharma plc.

                    CYCLACEL PHARMACEUTICALS, INC.
                 CONSOLIDATED STATEMENTS OF OPERATIONS

                              (Unaudited)

                                                             Period
                                                              from
                                                            August  13,
                                                               1996
                   For the three          For the nine      (inception)
                    months ended          months ended          to
                   September 30,          September 30,      Sept. 30,
                --------------------- --------------------- ----------
                   2008        2009      2008       2009       2009
                ---------- ---------- ---------- ---------- ----------
                                        ($000s)

 Revenues:
  Collaboration
   and research
   and
   development
   revenue              --         --         --         --      3,000
  Product
   revenue             257        223        590        688      1,526
  Grant
   revenue              12          7         36         36      3,671
                ---------- ---------- ---------- ---------- ----------
                       269        230        626        724      8,197
                ---------- ---------- ---------- ---------- ----------
 Operating
  expenses:
  Cost of
   goods sold          120        163        315        472        901
  Research and
   development       4,030      1,394     15,718      7,174    167,587
  General and
   administra-
   tive              3,218      2,188     11,337      6,703     70,011
  Goodwill and
   intangibles
   impairment        6,344         --      6,344         --      7,934
  Restructuring
   costs               489         --        489        366      2,634
                ---------- ---------- ---------- ---------- ----------
 Total
  operating
  expenses          14,201      3,745     34,203     14,715    249,067
                ---------- ---------- ---------- ---------- ----------
 Operating
  loss             (13,932)    (3,515)   (33,577)   (13,991)  (240,870)
 Other income
  (expense):
  Costs
   associated
   with aborted
   2004 IPO             --         --         --         --     (3,550)
  Payment
   under
   guarantee            --         --         --     (1,652)    (1,652)
  Change in
   valuation
   of
   derivative           --         --         --         --       (308)
  Change in
   valuation
   of warrants         432        101      3,321       (195)     6,512
  Foreign
   exchange
   gains/
   (losses)         (4,776)       119     (4,638)      (129)    (4,172)
  Interest
   income              287          7      1,184         94     13,635
  Interest
   expense             (69)       (41)      (244)      (156)    (4,613)
                ---------- ---------- ---------- ---------- ----------
 Total other
  income
  (expense)         (4,126)       186       (377)    (2,038)     5,852
                ---------- ---------- ---------- ---------- ----------
 Loss before
  taxes            (18,058)    (3,329)   (33,954)   (16,029)  (235,018)
 Income tax
  benefit              411        205      1,511        796     17,070
                ---------- ---------- ---------- ---------- ----------
 Net loss          (17,647)    (3,124)   (32,443)   (15,233)  (217,948)

 Dividends on
  Preferred
  Ordinary
  shares                --         --         --         --    (38,123)
                ---------- ---------- ---------- ---------- ----------
 Net loss
  applicable
  to common
  shareholders     (17,647)    (3,124)   (32,443)   (15,233)  (256,071)
                ---------- ---------- ---------- ---------- ----------

 Net loss
  per share -
  basic and
  diluted       $    (0.86)$    (0.13)$    (1.59)$    (0.71)
                ---------- ---------- ---------- ----------
 Weighted
  average
  shares        20,433,129 23,172,259 20,433,129 21,356,206
                ========== ========== ========== ==========


                    CYCLACEL PHARMACEUTICALS, INC.
                 CONDENSED CONSOLIDATED BALANCE SHEETS

                              (Unaudited)

                                               As of         As of
                                           ------------   ------------
                                            December 31   September 30
                                           ------------   ------------
                                                2008         2009
 ASSETS
 Current assets:
  Cash and cash equivalents                      24,220         14,433
  Short-term investments                          1,502             --
  Inventory                                         508            140
  Prepaid expenses and other current
   assets                                         2,784          1,652
                                           ------------   ------------
    Total current assets                         29,014         16,225
 Property, plant and equipment (net)              1,748          1,121
 Deposits and other assets                          195            196
                                           ------------   ------------
    Total assets                                 30,957         17,542
                                           ============   ============
 LIABILITIES AND STOCKHOLDERS' EQUITY
 Current liabilities:
  Accounts payable                                  754          1,463
  Accrued liabilities                             5,186          5,228
  Other current liabilities                       1,615          1,336
  Warrants liability                                 43            238
  Current portion of other accrued
   restructuring charges                          1,029          1,063
                                           ------------   ------------
    Total current liabilities                     8,627          9,328
 Other accrued restructuring charges,
  net of current                                  1,062            267
 Other long term payables                           626             --
                                           ------------   ------------
    Total liabilities                            10,315          9,595
                                           ------------   ------------
 Commitments and contingencies
 Stockholders' equity:
  Preferred stock, $0.001 par value;
   5,000,000 shares authorized at
   December 31, 2008 and September
   30, 2009, respectively; 2,046,813
   shares issued and outstanding at
   December 31, 2008 and September
   30, 2009, respectively 

  Aggregate preference in liquidation
   of $20,673,000 at December 31,
   2008 and September 30, 2009                        2              2
  Common stock, $0.001 par value;
   100,000,000 shares authorized at
   December 31, 2008 and September
   30, 2009; 20,433,129, and
   24,433,129 shares issued and
   outstanding at December 31, 2008
   and September 30, 2009,
   respectively                                      20             24
 Additional paid in capital                     223,377        225,864
 Accumulated other comprehensive loss               (42)             5
 Deficit accumulated during the
  development stage                            (202,715)      (217,948)
                                           ------------   ------------
    Total stockholders' equity                   20,642          7,947
                                           ------------   ------------
    Total liabilities and
     stockholders' equity                        30,957         17,542
                                           ============   ============

Cyclacel Pharmaceuticals, Inc.
Investors/Media:
Corey Sohmer
(908) 517-7330
csohmer@cyclacel.com