TORONTO, Aug. 11 /CNW/ - Fralex Therapeutics Inc. (TSX: FXI) ("Fralex" or
the "Company"), a medical technology company developing a treatment for
chronic pain associated with fibromyalgia using a non-invasive neuromodulation
device, announced today its financial results for the second quarter ended
June 30, 2008.
Recent Updates
- As at August 7 2008, enrolled 158 patients at 17 sites in the U.S.
and Canada, with 14 patients currently in screening
- Fralex-sponsored study employing fMRI to demonstrate activity of CNP
presented at Canadian Pain Society Meeting in Victoria, BC
"In the third quarter of 2008, we anticipate that the Data Monitoring
Committee (DMC) for our RELIEF trial will inform management whether to
continue the trial, or conversely, discontinue for reasons of safety or
futility, based on an interim analysis of the first 100 patients enrolled in
the trial. If the outcome is positive, the DMC will also recommend the number
of patients required, between 200 and 300, to power the study to reach
statistical significance at the primary endpoint," said Avi Grewal, President
and CEO of Fralex. "This will be a critical event for FRALEX - any outcome
other than futility will be an encouraging sign that our CNP therapy has the
potential to be an effective treatment for chronic pain associated with
fibromyalgia."
Financial Review
For the three months ended June 30, 2008, the Company reported an
increase in loss of $172,859 as compared with the same period in 2007,
primarily due to the increase in research and development costs of $372,259,
which increase is partially offset by a foreign exchange gain of $80,081 in
2008 as compared with a loss of $162,018 in 2007. For the six months ended
June 30, 2008, the Company reported an increase in loss of $469,742 as
compared with the same period in 2007 primarily due to the increase in
research and development costs of $934,225, partially offset by a foreign
exchange gain of $82,811 in 2008 as compared with a loss of $201,453 in 2007,
and a decrease in stock option expense of $210,104.
The increase in research and development costs is due to heightened
activity in the RELIEF trial as compared to the same period in 2007. In the
second quarter of 2008, the Company managed two contract research
organizations ("CROs") and 19 sites, all of which had been enrolling for a
portion of the quarter. During the second quarter of 2008, the Company
enrolled 36 new, and managed 48 existing, patients while during the same
period in 2007, the Company had just enrolled its first 6 patients into the
trial.
As at June 30, 2008, Fralex had cumulative losses of $15,031,501 while
holding cash and cash equivalents and short-term investments in the amount of
$5,866,368. Fralex's principal capital needs in the near term are for
completing the RELIEF trial, development of a market-ready device, supporting
ongoing research & development and general corporate expenses. While the
Company projects that its current cash and cash equivalents, and short-term
investments on hand of $5,866,368 will be sufficient to complete its planned
operations through to the end of the fourth quarter of 2008, its ability to
continue as a going concern beyond that point is dependent on its ability to
secure additional financing.
Detailed financial statements and the MD&A are available at
www.fralex.com or www.sedar.com.
About FRALEX:
FRALEX is a medical technology company focused on developing and
commercializing Complex Neural Pulse or CNP(TM), a novel neuromodulation
therapeutic technology for chronic pain, which utilizes specifically designed,
low-frequency electromagnetic pulses. FRALEX is proceeding with its FDA and
Health Canada-approved pivotal clinical trial (the "RELIEF" trial) to evaluate
the safety and effectiveness of this technology in the treatment of chronic
pain associated with fibromyalgia. For more information on FRALEX, please
visit www.fralex.com; further details on the RELIEF trial are posted on
www.relieftrial.com and www.clinicaltrials.gov.
Certain statements contained in this release containing words like
"believe", "intend", "may", "expect", and other similar expressions, are
forward-looking statements that involve a number of risks and uncertainties.
Factors that could cause actual results to differ materially from those
projected in the Company's forward-looking statements include the following:
market acceptance of Company's technologies and products; the ability to
obtain financing; Company's financial and technical resources relative to
those of its competitors; Company's ability to keep up with rapid
technological change; government regulation of therapeutic technologies; the
Company's ability to enforce its intellectual property rights and protect its
proprietary technologies; the ability to obtain and develop partnership
opportunities; the timing of commercial product launches; the ability to
achieve key technical milestones in key products and other risk factors
identified from time to time in the Company's filings.
Fralex Therapeutics Inc.
(A development stage company)
Interim Balance Sheets
Unaudited
-------------------------------------------------------------------------
June 30, December 31,
2008 2007
$ $
---------------------------
Assets
Current assets
Cash and cash equivalents 125,006 92,485
Short-term investments 5,741,362 7,681,861
Investment tax credits receivable - 727,077
Receivables - other 33,765 21,492
Prepaid expenses and deposits 137,535 142,499
---------------------------
6,037,668 8,665,414
Property and equipment 53,028 76,991
---------------------------
6,090,696 8,742,405
---------------------------
---------------------------
Liabilities
Current liabilities
Accounts payable and accrued liabilities 1,529,501 1,047,991
---------------------------
Shareholders' Equity
Share capital 18,027,262 18,027,262
Warrants 1,064,777 1,064,777
Other equity 516,226 392,330
Deficit (15,031,501) (11,787,891)
Accumulated other comprehensive income (loss) (15,569) (2,064)
---------------------------
4,561,195 7,694,414
---------------------------
6,090,696 8,742,405
---------------------------
---------------------------
Fralex Therapeutics Inc.
(A development stage company)
Interim Statements of Operations and Comprehensive Loss
Unaudited
-------------------------------------------------------------------------
Three months ended Six months ended
June 30, June 30,
2008 2007 2008 2007
$ $ $ $
-----------------------------------------------
Expenses
Research and development 1,205,763 833,504 2,581,999 1,647,774
General and administrative 343,251 370,482 722,293 742,770
Stock-based compensation 65,558 50,000 123,896 334,000
Amortization 12,260 18,485 30,794 36,826
Foreign exchange
(gain) loss (80,081) 162,018 (82,811) 201,453
-----------------------------------------------
Loss before
the undernoted (1,546,751) (1,434,489) (3,376,171) (2,962,823)
Interest income - net 53,321 113,918 132,561 188,955
-----------------------------------------------
Net loss for the period (1,493,430) (1,320,571) (3,243,610) (2,773,868)
-----------------------------------------------
-----------------------------------------------
Other comprehensive
(loss) income
Unrealized (loss) income
on available-for-sale
short-term investments (98,248) 2,211 (13,505) (3,137)
-----------------------------------------------
Comprehensive loss for
the period (1,591,678) (1,318,360) (3,257,115) (2,777,005)
-----------------------------------------------
-----------------------------------------------
Basic and diluted loss
per Common Share (0.07) (0.06) (0.15) (0.15)
-----------------------------------------------
-----------------------------------------------
%SEDAR: 00024447E
