Conference Call Scheduled for Today - Tuesday, March 10, 2009 at 4:30 p.m. Eastern Time
MOUNTAIN VIEW, Calif., March 10 /PRNewswire-FirstCall/ -- Alexza Pharmaceuticals, Inc. (Nasdaq: ALXA) reported today financial results for the fourth quarter and year ended December 31, 2008, and provided an update on its product development candidates. The net loss for the quarter and year ended December 31, 2008, as reported in accordance with accounting principles generally accepted in the United States (GAAP), was $15.0 million and $58.5 million, respectively, compared to a net loss of $13.2 million and $45.1 million in the comparable periods in 2007. Alexza had consolidated cash, cash equivalents and marketable securities (including investments held by Symphony Allegro) at December 31, 2008 of $58.9 million.
'In 2008, we made outstanding progress with AZ-004 (Staccato(R) loxapine), our lead program,' said Thomas B. King, President and CEO of Alexza. 'During the year, we initiated, fully enrolled and announced positive results in two Phase 3 clinical trials. This rapid progress has allowed us to be in the position to target an NDA filing for AZ-004 in early 2010. A majority of our focus and effort in 2009 will be on completing the balance of our NDA clinical program and finalizing the commercial manufacturing processes for AZ-004.'
Financial Results - Periods Ended December 31, 2008 and 2007
GAAP operating expenses were $18.4 million and $79.2 million in the quarter and year ended December 31, 2008, compared to $17.4 million and $60.5 million for the comparable periods in 2007. The increases resulted primarily from increased spending on AZ-004 and AZ-104 as the Company continued development of these product candidates under the Symphony Allegro agreement, increased spending on AZ-003 with continued development of this product candidate under the now terminated development agreement with Endo Pharmaceuticals, and increased share-based compensation costs. These increases were partially offset by the Company's reduced spending on its AZ-001, AZ-002 and AZ-007 product candidates as the Company focused its efforts on its other product candidates.
In January 2009, the Company announced that it had consolidated its operations, with a primary focus on the continued development of AZ-004 (Staccato loxapine). The restructuring included a workforce reduction of 52 employees, representing approximately 33% of the Company's total workforce. With the reduction in headcount and focus on the development of AZ-004, the Company expects to reduce its expenses by approximately $21.5 million, net of severance costs, for fiscal year 2009, compared to fiscal year 2008, and another reduction of approximately $11.1 million for fiscal year 2010, compared to fiscal year 2009. The Company anticipates that with current cash, cash equivalents and marketable securities along with interest earned thereon, expected payments from Symphony Allegro, the proceeds from option exercises, and purchases of common stock pursuant to its Employee Stock Purchase Plan, the Company will be able to maintain its currently planned operations into the second quarter of 2010. Changing circumstances may cause the Company to consume capital significantly faster or slower than currently anticipated.
On January 1, 2006, Alexza adopted FAS 123R and reports employee share-based compensation expense based on the grant date fair value of the award. Share-based compensation was $1.6 million and $5.4 million in the quarter and year ended December 31, 2008 compared to $1.4 million and $3.4 million in the comparable periods in 2007. Alexza's Consolidated Statements of Operations include the operations of Symphony Allegro, Inc., its variable interest entity. As the Company has no direct ownership in Allegro, it reduces its net loss by the losses incurred by Allegro. 'Loss attributed to noncontrolling interest in Symphony Allegro, Inc.' reduced net loss for the quarter and year ended December 31, 2008 by $2.9 million and $18.6 million, and reduced net loss by $3.1 million and $10.8 million in the comparable periods in 2007.
Product Candidates Development Update
- AZ-004 (Staccato loxapine). Alexza is developing AZ-004 for the acute treatment of agitation in patients with schizophrenia or bipolar disorder. AZ-004 is currently in Phase 3 clinical testing and the Company projects an NDA filing in early 2010.
In December 2008, the Company announced positive results from the second of its two Phase 3 clinical trials of AZ-004. This trial enrolled 314 acutely-agitated patients with bipolar I disorder at 17 U.S. clinical centers. The trial was designed as an in-clinic, multi-center, randomized, double-blind, placebo-controlled study, and tested AZ-004 at two dose levels, 5 mg and 10 mg. Patients were eligible to receive up to 3 doses of study drug in a 24-hour period, depending on their clinical status. Only one dose of study drug was allowed during the first 2 hours of the study period. Patients eligible for the study included those who were admitted through an emergency department and those who were already in-patients in a hospital setting, as long as they had acute agitation at the time of patient randomization. This study was the first AZ-004 study enrolling bipolar disorder patients. The primary endpoint for the study was a reduction of agitation, measured as the change from baseline in the PANSS, or Positive and Negative Symptom Scale, Excited Component Score, also known as the PEC score, measured at 2 hours after the first dose. The key secondary endpoint was the Clinical Global Impression-Improvement, or CGI-I, score, measured at 2 hours after the first dose. Both the 5 mg and 10 mg doses of AZ-004 met these primary and secondary endpoints.
