AKELA PHARMA REPORTS RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2011

AUSTIN, TX, June 14, 2011 /CNW/ - Akela Pharma, Inc. ("Akela"), (TSX: AKL), a drug development company with its lead product, Fentanyl TAIFUN®, being developed for the treatment of breakthrough cancer pain and the company's wholly owned subsidiary, PharmaForm, a leading specialty contract service provider in the area of pharmaceutical dosage form development and manufacturing, today announced its financial results for the three months and year ended March 31, 2011.

Total consolidated revenues for the three months ended March 31, 2011 were $4.2 million, including $3.0 million of contract services, as compared to $2.6 million, including $1.6 million of contract services, for the same period during the previous year.

Consolidated net income for the three months ended March 31, 2011 were $0.99 million, $0.03 per share, versus a loss of $0.32 million, ($0.01) per share, for the same periods in 2010.

        Three Months Ended
        March 31,
                    2011               2010
               
Income (loss) before under noted items $                997 $                (323)
                
Income (loss) before income taxes                    997                  (323)
               
(Provision for) recovery of income taxes:        
  Current            
  Future            
               
                            -                         -  
Total Comprehensive income(loss)                   997                   (323)
                
Basic and diluted net income (loss) per share $            0.03 $             (0.01)
                
Basic and diluted weighted average          
   number of shares outstanding         31,535,338            30,890,338

The Company had a cash balance of $0.14 million as of March 31, 2011 compared with $0.47 million as of December 31, 2010.

About Akela Pharma Inc.

Akela Pharma is a drug development company with its lead product, Fentanyl TAIFUN®, being developed for the treatment of breakthrough cancer pain. Fentanyl TAIFUN is a fast-acting fentanyl formulation delivered using the company's TAIFUN multi-dose dry powder inhaler platform.

About PharmaForm

PharmaForm, Akela's wholly owned subsidiary, is a leading specialty contract service provider in the area of pharmaceutical dosage form development and manufacturing, specializing in controlled release and bioavailability enhancement technologies, such as hot melt extrusion, liquid filled capsules, and spray drying.  Through its diverse offerings, PharmaForm solutions help pharmaceutical and biotechnology clients reach their development targets, reduce development costs and accelerate time-to-market.

Akela's common shares trade on The Toronto Stock Exchange ("TSX") under the symbol "AKL" with 32.4 million shares outstanding.

This press release contains statements which may constitute forward-looking information under applicable Canadian securities legislation or forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1955. Such forward-looking statements or information may include financial and other projections as well as statements regarding the company's future plans, objectives, performance, revenues, growth, profits, operating expenses or the company's underlying assumptions. The words "may", "would", "could", "will", "likely", "expect", anticipate", "intend", "plan", "forecast", "project", "estimate" and "believe" or other similar words and phrases may identify forward-looking statements or information. Persons reading this press release are cautioned that such statements or information are only expectations, and that the company's actual future results or performance may be materially different.

Forward-looking statements or information in this press release include, but are not limited to, statements or information concerning our ongoing drug development programs and collaborations as well as the possible receipt of future payments upon achievement of milestones.

Such forward-looking statements or information involve known and unknown risks, uncertainties and other factors that may cause our actual results, events or developments to be materially different from results, events or developments expressed or implied by such forward-looking statements or information. Such factors include, among others, the possibility that risks associated with requirements for approvals by government agencies such as the FDA before products can be tested in clinical trials; the possibility that such government agency approvals will not be obtained in a timely manner or at all or will be conditioned in a manner that would impair our ability to advance development; risks associated with the requirement that a drug candidate be found safe and effective after extensive clinical trials; our dependence on suppliers, collaborative partners and other third parties and the prospects and timing for negotiating supply agreements, corporate collaborations or licensing arrangements; our ability to attract and retain key personnel; and other factors as described in detail in our filings with the Canadian securities regulatory authorities at www.sedar.com.

Assumptions underlying our expectations regarding forward-looking statements or information contained in this press release include, among others, that future clinical trial results will be favorable; that our drug candidate will treat target diseases as intended; that we will raise enough capital, on reasonable terms and in a timely manner; that we will retain our key personnel; that we will obtain the necessary regulatory approvals.

In the event that any of these assumptions prove to be incorrect, or in the event that we are impacted by any of the risks identified above, we may not be able to continue in our business as planned.

For a complete discussion of the assumptions, risks and uncertainties related to our business, you are encouraged to review our filings with Canadian securities regulatory authorities, filed on SEDAR at www.sedar.com.

All forward-looking statements and information made herein are based on our current expectations as of the date hereof and we disclaim any intention or obligation to revise or update such forward-looking statements and information to reflect subsequent events or circumstances, except as required by law.

AKELA PHARMA INC.
Condensed Consolidated Statements of Financial Position
(Unaudited)

March 31, 2011, December 31, 2010 and January 1, 2010
(in thousands of US dollars, except share and per share data)

    As at   As at   As at
    March 31, 2011   December 31, 2010   January 1, 2010
Assets            
Current assets:            
  Cash  $ 141 $ 474 $ 107
  Restricted cash    -   -   938
  Accounts receivable     1,642   1,590   1,679
  Prepaid expenses and other current assets   1,076   302   417
    2,859   2,366   3,141
             
Property and equipment   2,863   3,085   4,217
Intangible assets     62   74              
Other assets    83   67   598
             
  $ 5,867 $ 5,592 $ 7,956
Liabilities and Shareholders' Deficiency            
             
Current liabilities:            
  Accounts payable & accrued liabilities $ 5,678 $ 5,709 $ 7,801
  Deferred revenue    3,191   3,527   2,795
  Income Tax Payable       266            
  Current portion of long-term debt   950   1,037   1,202
    9,819   10,539   11,798
             
Deferred revenue    12,257   12,979   14,630
Long-term debt   6,861   6,443   6,615
Income taxes   275   -   799
             
Shareholders' deficiency:            
  Common shares  (unlimited authorized, 32,390,110 common shares issued and outstanding with no par value at March 31, 2011 and December 31, 2010, respectively)    67,739   67,739   67,544
  Additional paid-in capital   8,468   8,441   8,540



AKELA PHARMA INC.
Condensed Consolidated Statements of Income (Loss) and Comprehensive Income (Loss)
(Unaudited)

March 31, 2011, December 31, 2010 and January 1, 2010
(in thousands of US dollars, except share and per share data)

   
  Three Months Ended
  March 31,
  2011 2010
     
Revenues $ 4,193 $ 2,601
     
Expenses:    
  Direct costs 1,355 1,444
  Selling, general and administrative 1,175 1,403
  Research and development 64 129
  Stock-based compensation 27 8
  Depreciation of property and equipment 223 357
  Amortization of intangible assets 12         
  Interest on long-term debt 25 63
  Unrealized (gain) loss on securities held for trading    29
  Foreign exchange (gain) loss 315 (392)
  Gain (loss) on expiration and valuation of warrants as debt   (117)
  Total expenses 3,196 2,924
       
Income (loss) before under noted items 997 (323)
     
Income (loss) before income taxes 997 (323)
     
(Provision for) recovery of income taxes:    
  Current    
  Future    
  - -
Total Comprehensive income (loss) 997 (323)
     
Basic and diluted net income (loss) per share $ 0.03 $ (0.01)
     
Basic and diluted weighted average    
  number of shares outstanding 31,535,338 30,890,338



AKELA PHARMA INC.
Condensed Consolidated Statements of Cash Flows
(Unaudited)

Three month periods ended March 31, 2010 and 2009
(in thousands of US dollars, except share and per share data)

         
  2011 2010
         
Cash flows from operating activities:        
   Net income/(loss) and comprehensive income(loss) $             997 $                (323)
   Adjustments for:        
      Amortization and write-off        
         of property and equipment               222                    357
      Amortization of intangible assets                 12                       -  
      Stock-based compensation                 26                        8
      Unrealized (gain) loss on securities held for trading                 -                         -  
      Unrealized foreign exchange loss               332                    (60)
      Amortization of deferred gain of property                 -                         -  
      Future income taxes                 -                         -  
   Net changes in operating assets                 -                         -  
      and liabilities (note 13)          (1,922)                  (162)
              (333)                  (180)
Cash flows from financing activities:        
   Restricted cash                 -                         -  
   Proceeds from issuance of shares                 -                         -  
   Repayment of convertible debentures                 -                         -  
   Share issue costs                 -                         -  
   Proceeds from issuance of long-term debt                 -                         -  
   Addition to deferred financing fees                 -                         -  
   Repayment of long-term debt                           -  
                  -                         -  
Cash flows from investing activities:        
   Acquisition of property and equipment                           -  
   Addition to intangible assets                 -                         -  
   Corporate transaction costs                 -                         -  
   Other advances and investments                 -                         -  
                  -                         -  
Net decrease in cash and cash equivalents             (333)                  (180)
         
Cash and cash equivalents, beginning of period               474                 1,045
         
Effect of exchange rate changes                 -                         -  
         
Cash and cash equivalents, end of period $             141                    865
         
Cash and cash equivalents are composed of:        
   Cash               141                    865
   Money market fund                 -      
  $             141                    865
         
         
         

 

 

 

 

 

 

 

SOURCE AKELA PHARMA INC.

For further information:

Akela Pharma Inc.

Gregory M. McKee
President and Chief Executive Officer
Tel: 512-834-0449

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AKELA PHARMA INC.

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