PHILADELPHIA, March 18, 2013 (GLOBE NEWSWIRE) -- Hemispherx Biopharma (NYSE MKT:HEB) announced its financial results for the fiscal year ended December 31, 2012. The net loss for 2012's twelve month period (including non-cash effects) was approximately $17,354,000 or $(0.12) per share as compared to a net loss of $9,015,000 or ($0.07) per share for the same period in 2011. This year-to-year increase in net loss of approximately $8,339,000 (93%) was predominantly caused by:
- the cost of our continued efforts to seek FDA approval of the Ampligen(R) NDA for Chronic Fatigue Syndrome and preparations for FDA inspections of our New Brunswick, NJ manufacturing facility;
- the cost of fill, finish and packaging of Alferon N Injection(R) Work-In-Process inventory along with a related valuation write-down of existing inventory to the lower of cost or market; and
- the fair value revaluation of the estimated liability related to certain redeemable warrants resulting in a non-cash gain of $85,000 in 2012 as compared to a gain of $2,425,000 for the same period in 2011 for an increased loss of $2,340,000 comparing the two years.
If the non-cash effect of the revaluation of the estimated liability related to the warrants, the inventory write-down and the other non-cash items were excluded from the financial results, the net cash used in operating activities for the twelve month period of 2012 would be approximately $13,136,000 as compared to $10,096,000 for 2011, resulting in an increase in cash used for operations of approximately $3,040,000 or 30%.
Cash, cash equivalents and marketable securities were approximately $43,953,000 as of December 31, 2012 compared to $34,391,000 as of December 31, 2011. Cash, cash equivalents and marketable securities, net of the Margin Loan used for the facility enhancement project at our New Brunswick facility, was approximately $36,902,000 as of December 31, 2012 as compared to $32,696,000 as of December 31, 2011, an increase of approximately $4,206,000 in available cash and marketable securities.
We own and operate a 43,000 sq. ft. FDA approved facility in New Brunswick, NJ that is designed to produce Alferon(R), and Ampligen(R). In December 2011, our Board of Directors reevaluated and expanded the facility enhancement project that focused on high volume, cost effective manufacturing processes for three products: Alferon N Injection(R), Alferon(R) LDO (a low does oral form of Alferon(R)) and Ampligen(R). The facility enhancement project is in its final stage with construction complete and a Certificate of Approval issued by the city of New Brunswick for the work completed. Approximately $7,051,000 has been spent on this project through December 31, 2012 and financed through a Margin Loan with an effective interest rate of approximately 2.75%, as compared to $1,695,000 at December 31, 2011.
On February 1, 2013, we received a Complete Response Letter ("CRL") from the FDA declining at this time to approve our new drug application for Ampligen(R) for CFS. The FDA said Hemispherx should conduct at least one additional clinical trial, complete various nonclinical studies and perform a number of data analyses. In its CRL, the FDA set forth the reasons for this action and provided recommendations to address certain of the outstanding issues. We plan to request an end-of-review conference with the FDA to discuss the Agency's decision regarding this potential treatment for a serious, debilitating and life threatening unmet medical need.
On March 4, 2013, we announced that ANMAT, the agency responsible for the national regulation of drugs, foods and medical technology in Argentina, has approved the use of Alferon N Injection(R) (under the brand name "Naturaferon") in Argentina for any patient that fails or becomes intolerant to treatment with recombinant interferon. Naturaferon was previously approved in Argentina for the treatment of refractory or recurring external condylomata acuminata (genital warts). The timelines for when drug can be shipped to Argentina and when resulting revenues in Argentina will occur cannot be determined at this time.
The information in this press release includes certain "forward-looking" statements (explained below), including statements about additional steps which the FDA may require and Hemispherx may take in continuing to seek FDA approval of the Ampligen(R) NDA for the treatment of Chronic Fatigue Syndrome. The final results of these and other ongoing activities could vary materially from Hemispherx's expectations and could adversely affect the chances for approval of the Ampligen(R) NDA. Any failure to satisfy the FDA's requirements could significantly delay, or preclude outright, approval of the Ampligen(R) NDA.
The information in this press release also includes certain "forward-looking" statements related to the likelihood of the use of Naturaferon (Alferon N Injection(R)) for the treatment of various diseases in Argentina and the timelines for when drug can be shipped to Argentina and when revenues will occur. Information contained in this news release, other than historical information, should be considered forward-looking and is subject to various risk factors and uncertainties. For instance, the strategies and operations of Hemispherx involve risk of competition, changing market conditions, change in laws and regulations affecting these industries and numerous other factors discussed in this release and in the Company's filings with the Securities and Exchange Commission. The final results of these efforts could vary materially from Hemispherx's expectations.
About Hemispherx Biopharma
Hemispherx Biopharma, Inc. is an advanced specialty pharmaceutical company engaged in the manufacture and clinical development of new drug entities for treatment of seriously debilitating disorders. Hemispherx's flagship products include Alferon N Injection(R) and the experimental therapeutics Ampligen(R) and Alferon(R) LDO. Ampligen(R) is an experimental RNA nucleic acid being developed for globally important debilitating diseases and disorders of the immune system, including Chronic Fatigue Syndrome. Hemispherx's platform technology includes components for potential treatment of various severely debilitating and life threatening diseases. Because both Ampligen(R) and Alferon(R) LDO are experimental in nature, they are not designated safe and effective by a regulatory authority for general use and are legally available only through clinical trials. Hemispherx has patents comprising its core intellectual property estate and a fully commercialized product (Alferon N Injection(R)), approved for sale in the U.S. and Argentina for refractory or recurring external genital warts in patients 18 years of age or older. The Company wholly owns and exclusively operates a GMP certified manufacturing facility in the United States for commercial products. For more information please visit www.hemispherx.net.
To the extent that statements in this press release are not strictly historical, all such statements are forward-looking, and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Words such as "hopes," "believes," "plans," "anticipates," and similar expressions are intended to identify forward-looking statements. The inclusion of forward-looking statements should not be regarded as a representation by Hemispherx that any of its plans will be achieved. These forward-looking statements are neither promises nor guarantees of future performance, and are subject to a variety of risks and uncertainties, many of which are beyond Hemispherx's control, which could cause actual results to differ materially from those contemplated in these forward-looking statements. Examples of such risks and uncertainties include those set forth in the Disclosure Notice, above, as well as the risks described in Hemispherx's filings with the Securities and Exchange Commission, including the most recent reports on Forms 10-K, 10-Q and 8-K. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and Hemispherx undertakes no obligation to update or revise the information contained in this press release, whether as a result of new information, future events or circumstances or otherwise revise or update this release to reflect events or circumstances after the date hereof.
Hemispherx Biopharma, Inc.