ConjuChem Announces Fiscal 2008 First Quarter Financial Results



    MONTREAL, March 13 /CNW/ - ConjuChem Biotechnologies (TSX:CJB) today
announced financial results for the first quarter of fiscal 2008, ended
January 31, 2008.
    Net loss for the quarter ended January 31, 2008 amounted to
$11.8 million, or ($0.05) per share, compared to $18.6 million, or ($0.10) per
share, for the quarter ended January 31, 2007. The decrease in the net loss is
mainly attributable to a decrease in net Research and Development expenses.
Cash flows applied to operating activities in the three-month period ended
January 31, 2008 amounted to $6.3 million compared to $12.7 million for the
quarter ended January 31, 2007.
    The Company recorded interest income on cash, short and long-term
investments that amounted to $0.6 million for the quarter ended January 31,
2008, compared to $0.9 million for the quarter ended January 31, 2007. The
decrease in interest income was a result of a reduction of the Company's
investment portfolio base.
    Gross research and development expenses amounted to $3.7 million for the
quarter ended January 31, 2008 compared to $15.9 million for the quarter ended
January 31, 2007. The decrease this quarter is largely attributable to the
purchase of drug substance for the clinical advancement of
PC-DAC(TM):Exendin-4, which occurred in the first quarter of 2007.
    General and administrative costs amounted to $1.6 million for the quarter
ended January 31, 2008 compared to $0.8 million for the quarter ended January
31, 2007. The increase in general and administrative expenses is attributable
to financial charges and fees related to the early redemption of the
convertible senior unsecured notes and to an increase in additional headcount
compensation and benefits.
    During the quarter, the Company repaid the convertible senior unsecured
notes amounting to $45,000,000 plus accrued interest of $13,006,914 for a
total amount of $58,006,914 and closed a public offering of 22,000 convertible
unsecured subordinated debenture units of the Company at a price of $1,000 per
Unit, for gross proceeds of $22,000,000 and net proceeds of approximately
$20,000,000.
    As at January 31, 2008, the Company had cash and cash equivalents and
short-term investments totalling $41.5 million compared to $26.0 million at
October 31, 2007. As at January 31, 2008, working capital amounted to $35.9
million. ConjuChem believes that its current cash and cash equivalents,
available-for-sale marketable securities and interest income will be
sufficient to carry out current research and development plans and operations
through the first quarter of 2009.

    Notice of AGM

    ConjuChem will hold its Annual General Meeting of Shareholders at 4:15 on
Tuesday, March 18, 2008 at the Loews Vogue Hotel, 1425, de la Montagne Street,
Montreal, Quebec, H3G 1Z3

    About ConjuChem Biotechnologies

    ConjuChem Biotechnologies, developer of next generation medicines from
therapeutic peptides, is creating long-acting compounds based on
bioconjugation platform technologies. When applied to peptides, the Company's
systemic DAC(TM) and PC-DAC(TM) Technologies enable the creation of new drugs
with significantly enhanced therapeutic properties as compared to the original
peptide. Detailed descriptions of the Company can be viewed on the Company's
website www.conjuchem.com.

    Forward-Looking Statements

    Some of the statements made herein may constitute forward-looking
statements. These statements relate to future events or our future financial
performance and involve known and unknown risks, uncertainties and other
factors that may cause ConjuChem Biotechnologies' actual results, performance
or achievements to be materially different from those expressed or implied by
any of the Company's statements. Actual events or results may differ
materially. We disclaim any intention, and assume no obligation, to update
these forward-looking statements unless requested to do so by securities
regulators.

    
    ConjuChem Biotechnologies Inc.

                               BALANCE SHEETS
                                 (unaudited)

    As at
                                                  January 31,     October 31,
                                                        2008            2007
                                                           $               $
                                                -----------------------------
    ASSETS
    Current
    Cash and cash equivalents                     14,107,401       1,235,704
    Available-for-sale short-term investments     27,416,831      24,797,545
    Accounts receivable and other assets             340,768         103,277
    Investment tax credits receivable                945,000       1,169,000
    Prepaid expenses                                 104,330         208,945
                                                -----------------------------
    Total current assets                          42,914,330      27,514,471
    Held-to-maturity long-term investments                 -      59,736,098
    Property, plant and equipment                  1,003,798       1,049,147
    Intangible assets                                 17,955          19,257
                                                -----------------------------
                                                  43,936,083      88,318,973
                                                -----------------------------
                                                -----------------------------

    LIABILITIES AND SHAREHOLDERS' EQUITY
    Current liabilities
    Accounts payable and accrued liabilities       7,012,973       8,576,258
    Unearned revenues                                 22,071          35,314
                                                -----------------------------
    Total current liabilities                      7,035,044       8,611,572
    Convertible senior unsecured notes                     -      52,502,487
    Convertible unsecured subordinated
     debentures                                   12,985,807               -
                                                -----------------------------
                                                  20,020,851      61,114,059
                                                -----------------------------

    Shareholders' equity
    Capital stock                                265,332,302     265,332,302
    Warrants                                      14,093,394      11,885,875
    Equity portion of convertible senior
     unsecured notes                                       -      14,966,780
    Equity portion of convertible unsecured
     subordinated debentures                       5,610,777               -
    Contributed surplus                           43,690,648      28,008,989
    Deficit                                     (304,814,216)   (292,973,699)
    Accumulated other comprehensive income
     (loss)                                            2,327         (15,333)
                                                -----------------------------
    Total shareholders' equity                    23,915,232      27,204,914
                                                -----------------------------
                                                  43,936,083      88,318,973
                                                -----------------------------
                                                -----------------------------



    ConjuChem Biotechnologies Inc.

                            STATEMENTS OF DEFICIT
                                 (unaudited)

    Three months ended January 31,
                                                        2008            2007
                                                           $               $
                                                -----------------------------
    Deficit, beginning of period                (292,973,699)   (247,082,959)
    Net loss for the period                      (11,840,517)    (18,629,963)
                                                -----------------------------
    Deficit, end of period                      (304,814,216)   (265,712,922)
                                                -----------------------------
                                                -----------------------------



    ConjuChem Biotechnologies Inc.

                         STATEMENTS OF OPERATIONS AND
                             COMPREHENSIVE LOSS
                                 (unaudited)

    Three months ended January 31,
                                                        2008            2007
                                                           $               $
                                                -----------------------------

    REVENUES
    Contract revenues                                 27,347               -
    Interest income                                  572,655         862,330
                                                -----------------------------
                                                     600,002         862,330
                                                -----------------------------

    EXPENSES
    Research and development                       3,657,857      15,901,773
    Investment tax credits                          (100,000)       (150,000)
                                                -----------------------------
    Net research and development expenses          3,557,857      15,751,773
    General and administrative expenses            1,586,641         825,448
    Amortization of property, plant and
     equipment                                        55,121          62,666
    Amortization of intangible assets                  2,481           4,305
    Non-cash stock-based compensation                714,879         830,567
    Financial charges                                  4,206           4,677
    Foreign exchange loss                            178,951         307,335
    Accretion in carrying value of convertible
     senior unsecured notes and interest           5,504,427       1,705,522
    Accretion in carrying value of convertible
     unsecured subordinated debentures and
     interest                                        568,517               -
    Loss on redemption of held-to-maturity
     long-term investments                           267,439               -
                                                -----------------------------
                                                  12,440,519      19,492,293
                                                -----------------------------
    Net loss                                     (11,840,517)    (18,629,963)

    OTHER COMPREHENSIVE INCOME
    Unrealized gain (loss) on available-for-
     sale short-term investments                       2,327         (10,794)
                                                -----------------------------
    Comprehensive loss                           (11,838,190)    (18,640,757)
                                                -----------------------------
                                                -----------------------------
    Basic and diluted loss per share                   (0.05)          (0.10)
                                                -----------------------------
                                                -----------------------------
    Weighted average number of common shares
     outstanding during the period               240,213,668     183,902,987
                                                -----------------------------
                                                -----------------------------



    ConjuChem Biotechnologies Inc.

                           STATEMENTS OF CASH FLOWS
                                 (unaudited)

    Three months ended January 31,
                                                        2008            2007
                                                           $               $
                                                -----------------------------
    OPERATING ACTIVITIES
    Net loss                                     (11,840,517)    (18,629,963)
    Items not affecting cash:
      Amortization of property, plant and
       equipment                                      55,121          62,666
      Amortization of intangible assets                2,481           4,305
      Amortization of premium on held-to-
       maturity long-term investments                 (8,436)        (15,187)
      Non-cash stock-based compensation              714,879         830,567
      Accretion in carrying value of
       convertible senior unsecured notes
       and interest                                5,504,427       1,696,800
      Accretion in carrying value of
       convertible unsecured subordinated
       debentures and interest                       568,517               -
      Loss on redemption of held-to-maturity
       long-term investments                         267,439               -
                                                -----------------------------
                                                  (4,736,089)    (16,050,812)

      Net changes in non-cash working capital
       balances relating to operations            (1,576,156)      3,324,373
                                                -----------------------------
    Cash flows relating to operating
     activities                                   (6,312,245)    (12,726,439)
                                                -----------------------------

    INVESTING ACTIVITIES
    Acquisition of available-for-sale
     short-term investments                      (12,910,701)    (36,990,935)
    Proceeds on maturities of available-for-
     sale short-term investments                  10,399,827      11,664,301
    Acquisition of held-to-maturity long-term
     investments                                    (167,037)    (57,219,039)
    Proceeds on redemption of held-to-maturity
     long-term investments                        59,644,132               -
    Acquisition of property, plant and
     equipment                                        (9,772)        (65,259)
    Acquisition of intangible assets                  (1,179)         (2,751)
                                                -----------------------------
    Cash flows relating to investing
     activities                                   56,955,270     (82,613,683)
                                                -----------------------------

    FINANCING ACTIVITIES
    Repayment of convertible senior unsecured
     notes                                       (58,006,914)              -
    Issuance of convertible unsecured
     subordinated debentures                      22,000,000               -
    Issuance costs paid in cash                   (1,764,414)              -
    Issuance of common shares for cash                     -     120,250,000
    Share issue costs paid in cash                         -      (6,648,616)
                                                -----------------------------
    Cash flows relating to financing
     activities                                  (37,771,328)    113,601,384
                                                -----------------------------

    Net increase in cash and cash equivalents
     during the period                            12,871,697      18,261,262
    Cash and cash equivalents, beginning of
     period                                        1,235,704       4,034,937
                                                -----------------------------
    Cash and cash equivalents, end of period      14,107,401      22,296,199
                                                -----------------------------
                                                -----------------------------

    Supplemental cash flow information:
    Interest paid                                 13,006,914           1,273
                                                -----------------------------
    




For further information:

For further information: Lennie Ryer, CA, Vice President, Finance & CFO,
ConjuChem Biotechnologies Inc., (514) 844-5558, ext. 224, ryer@conjuchem.com;
James Smith, Investor Relations, (416) 815-0700, ext. 229,
jsmith@equicomgroup.com

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CONJUCHEM BIOTECHNOLOGIES INC.

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