AEterna Zentaris Reports First Quarter 2009 Financial and Operating Results



    All amounts are in U.S. dollars

    QUEBEC CITY, May 6 /CNW Telbec/ - AEterna Zentaris Inc. (NASDAQ:   AEZS,
TSX: AEZ) ("the Company"), a global biopharmaceutical company focused on
endocrinology and oncology, today reported financial and operating results as
at and for the three months ended March 31, 2009.

    
    First Quarter 2009 Highlight

    Signing of partnership with sanofi-aventis for cetrorelix in benign
prostatic hyperplasia ("BPH") for the U.S. market:

    - Initial $30 million upfront payment to the Company;
    - Up to $135 million in additional payments upon achieving certain
      pre-established regulatory and commercial milestones;
    - Escalating double-digit royalties on future net sales of cetrorelix for
      BPH in the U.S.;
    - Sanofi-aventis responsible for the commercialization and booking of
      sales in the U.S.;
    - The Company retained certain rights to co-promote cetrorelix for BPH in
      the U.S.
    

    Juergen Engel, Ph.D., AEterna Zentaris' President and Chief Executive
Officer commented, "The first quarter of 2009 was marked by the signing of a
major agreement with sanofi-aventis for the development, registration and
marketing of our lead compound, cetrorelix, in BPH for the United States
market. The agreement is an important milestone in our quest to bring
cetrorelix to market, provide millions of men with a novel treatment for BPH
and generate significant long-term revenue for the Company. We expect to
disclose results of our Phase 3 program with cetrorelix in BPH over the next
few months as we continue to evaluate other strategic partnerships for this
compound. Furthermore, we will push forward our promising drug candidates in
oncology, such as AEZS-108 and AEZS-112, while in collaboration with our
partners, we expect to move perifosine and ozarelix to the final development
stages."
    Dennis Turpin, Senior Vice President and Chief Financial Officer of
AEterna Zentaris added, "The recent partnership with sanofi-aventis has
further strengthened our financial position. We are now well poised to
continue to advance our lead compounds in endocrinology and oncology."

    CONSOLIDATED RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2009

    Consolidated revenues were $6.1 million for the three-month period ended
March 31, 2009, compared to $9.7 million for the same period in 2008. The
decrease is related to lower royalty revenues having been recognized in the
first quarter of 2009. The comparative decrease is also attributable to euro
to US dollar exchange rate fluctuations, given the comparative strengthening
of the US dollar in the first quarter of 2009 vis-à-vis the euro.
    Consolidated selling, general and administrative expenses were $3.6
million for the three-month period ended March 31, 2009, compared to $4.4
million for the same period in 2008. This decrease is primarily related to
comparative euro to US dollar exchange rate fluctuations, given the
comparative strengthening of the US dollar in the first quarter of 2009
vis-à-vis the euro, as well as to continuing cost-saving measures that were
implemented beginning in the second quarter of 2008.
    Consolidated R&D costs, net of tax credits and grants, were $11.4 million
for the three-month period ended March 31, 2009, compared to $13.7 million for
the same period in 2008. The comparative decrease in net R&D costs is largely
attributable to euro to US dollar exchange rate fluctuations.
    Consolidated net loss was $12.4 million, or $0.23 per basic and diluted
share, for the three-month period ended March 31, 2009, compared to $10.9
million, or $0.20 per basic and diluted share, for the same period in 2008.
This increase is mainly related to lower foreign exchange gains recorded in
the three-month period ended March 31, 2009, compared to the same period in
2008. The increase is also related to a gain recorded in the three-month
period ended March 31, 2008 on the disposal of Impavido(R), partially offset
by the reduction in loss from operations in the three-month period ended March
31, 2009.
    Consolidated cash, cash equivalents and short-term investments were $62.5
million as at March 31, 2009.

    CONFERENCE CALL

    Management will be hosting a conference call for the investment community
beginning at 3:30 p.m. Eastern Time today, Wednesday, May 6, 2009, to discuss
first quarter 2009 results. Individuals interested in participating in the
live conference call by telephone may dial 416-644-3422, 514-807-8791 or
800-587-1893, or may listen through the Internet at www.aezsinc.com. A replay
will be available on the Company's website for 30 days following the live
event.

    About AEterna Zentaris Inc.

    AEterna Zentaris Inc. is a global biopharmaceutical company focused on
endocrine therapy and oncology, with proven expertise in drug discovery,
development and commercialization. News releases and additional information
are available at www.aezsinc.com.

    Forward-Looking Statements

    This press release contains forward-looking statements made pursuant to
the safe harbor provisions of the U.S. Securities Litigation Reform Act of
1995. Forward-looking statements involve known and unknown risks and
uncertainties, which could cause the Company's actual results to differ
materially from those in the forward-looking statements. Such risks and
uncertainties include, among others, the availability of funds and resources
to pursue R&D projects, the successful and timely completion of clinical
studies, the ability of the Company to take advantage of business
opportunities in the pharmaceutical industry, uncertainties related to the
regulatory process and general changes in economic conditions. Investors
should consult the Company's quarterly and annual filings with the Canadian
and U.S. securities commissions for additional information on risks and
uncertainties relating to the forward-looking statements. Investors are
cautioned not to rely on these forward-looking statements. The Company does
not undertake to update these forward-looking statements, and we disclaim any
obligation to update any such factors or to publicly announce the result of
any revisions to any of the forward-looking statements contained herein to
reflect future results, events or developments except if we are requested to
do so by a governmental authority or applicable law.

    Attachment: Financial summary

    
    Quarterly Consolidated Statements of Loss (unaudited)

                                                     Quarters ended March 31,
    -------------------------------------------------------------------------
    (in thousands, except per share data)                 2009          2008
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                           $             $
    Revenues
    Sales and royalties                                  4,971         7,942
    License fees and other                               1,140         1,806
    -------------------------------------------------------------------------
                                                         6,111         9,748
    -------------------------------------------------------------------------
    Operating expenses
    Cost of sales                                        3,694         4,604
    Research and development costs, net of tax
     credits and grants                                 11,437        13,689
    Selling, general and administrative                  3,554         4,404
    Depreciation and amortization
      Property, plant and equipment                        311           369
      Intangible assets                                    557           840
    -------------------------------------------------------------------------
                                                        19,553        23,906
    -------------------------------------------------------------------------
    Loss from operations                               (13,442)      (14,158)
    -------------------------------------------------------------------------
    Other income (expenses)
    Interest income                                        156           277
    Interest expense                                        (2)          (15)
    Foreign exchange gain                                  900         2,255
    Gain on disposal of long-lived assets held for
     sale                                                    -           775
    -------------------------------------------------------------------------
                                                         1,054         3,292
    -------------------------------------------------------------------------
    Net loss for the period                            (12,388)      (10,866)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Net loss per share
    Basic and diluted                                    (0.23)        (0.20)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Weighted average number of shares
    Basic and diluted                               53,187,470    53,187,470
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    Consolidated Balance Sheet Information (unaudited)
    -------------------------------------------------------------------------
                                                         As at         As at
                                                      March 31,  December 31,
    (in thousands)                                        2009          2008
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                           $             $

    Cash and cash equivalents                           61,994        49,226
    Short-term investments                                 477           493
    Accounts receivable and other current assets        11,008        12,005
    Property, plant and equipment                        6,345         6,682
    Other long-term assets                              39,207        39,936
    -------------------------------------------------------------------------
    Total assets                                       119,031       108,342
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Accounts payable and other current liabilities      25,990        22,121
    Current portion of long-term payable                    48            49
    Long-term payable                                      143           172
    Non-financial long-term liabilities                 85,000        64,525
    -------------------------------------------------------------------------
    Total liabilities                                  111,181        86,867
    Shareholders' equity                                 7,850        21,475
    -------------------------------------------------------------------------
    Total liabilities and shareholders' equity         119,031       108,342
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    




For further information:

For further information: Investor Relations: Ginette Vallières, Investor
Relations Coordinator, (418) 652-8525 ext. 265, gvallieres@aezsinc.com; Media
Relations: Paul Burroughs, Director of Communications, (418) 652-8525 ext.
406, pburroughs@aezsinc.com

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