Isotechnika Pharma reports second quarter 2009 financial results



    EDMONTON, Aug. 6 /CNW/ - Isotechnika Pharma Inc. (TSX:ISA) today
announced its financial results for the second quarter ended June 30, 2009.

    
    The highlights of the second quarter included:

    -   The completion of the Plan of Arrangement with Paladin Labs Inc.
        ("Paladin"), a leading Canadian specialty pharmaceutical company,
        which creates a strategic partnership for the future
        commercialization of voclosporin in Canada, Mexico, Central and South
        America, Israel and South Africa. This arrangement provided
        Isotechnika Pharma with gross proceeds of $7 million upon completion
        and $4.35 million in supported R&D funding over the next 12 months.

    -   Mr. Jonathan Ross Goodman, founder, President & CEO of Paladin,
        assumed the position as Chairman of the Board of Directors.
        Additionally, Ms. Nancy Harrison, co-founder of MSI Methylation
        Sciences Inc. and former Senior Vice President of Ventures West
        Management Inc., joined as a new Board member. Ms. Mary Ritchie and
        Mssrs. Douglas Walker and Donald Schurman resigned from the Board.

    -   The release of positive data from both the Phase 2b PROMISE trial
        evaluating voclosporin in de novo kidney transplant patients after
        12 months of treatment and the Phase 3 ESSENCE trial evaluating
        voclosporin in moderate to severe psoriasis patients.
    

    "During the second quarter, the Company continued to take the necessary
steps to focus its resources and reduce the burn rate," stated Dr. Robert
Foster, President & CEO of Isotechnika. "We are actively seeking additional
partners for voclosporin and evaluating opportunities to acquire new
technologies for Isotechnika Pharma."

    Financial Results

    At June 30, 2009, the Company has $7.3 million in cash and cash
equivalents.
    The Company reported a consolidated net loss of $472,000 or $nil per
common share for the three months ended June 30, 2009, as compared to a
consolidated net loss of $5.4 million or $0.05 per common share for the same
period in 2008. For the six months ended June 30, 2009, the consolidated net
loss was $4.6 million or $0.04 per common share compared to $10.8 million or
$0.10 per common share for the comparable period in 2008. The consolidated net
loss decreased due to the Company having lower clinical trial expenses and
recording a gain of $2.3 million on the asset sale pursuant to the Arrangement
with Paladin.
    Revenue increased slightly to $718,000 for the second quarter ended June
30, 2009, compared to $565,000 for the second quarter ended June 30, 2008. The
Company recorded revenue of $1.5 million for the six months ended June 30,
2009, as compared to $1.1 million for the same period in 2008.
    Research and development expenditures were $1.5 million in the second
quarter of 2009, compared to $3.9 million in the second quarter of 2008, a
decrease of $2.4 million. The Company incurred total research and development
expenditures of $4.0 million for the six months ended June 30, 2009, as
compared to $7.8 for the same period in 2008.
    The decrease in research and development expenditures was primarily due
to reduced clinical trial costs for both the voclosporin Phase 2b renal
transplant and the Phase 3 European/Canadian psoriasis trials. Both of these
trials were in the final stages of completion in 2009. The Company's financial
position also limited research and development activities.
    Corporate, administration and marketing costs decreased to $1.4 million
for the second quarter of 2009, compared to $1.6 million for the second
quarter of 2008. Isotechnika incurred a total corporate, administration and
marketing expenditure of $2.4 million for the six months ended June 30, 2009,
as compared with $3.1 million for the same period in fiscal 2008.
    For further discussion of the Company's financial results for the three
months ended June 30, 2009, the unaudited interim consolidated financial
statements and the Management's Discussion and Analysis are accessible on
Isotechnika's Web site at www.isotechnika.com or at www.sedar.com.

    
    About Isotechnika
    -----------------
    
    Edmonton-based Isotechnika Pharma Inc. is a biopharmaceutical company
focused on the discovery and development of novel immunosuppressive
therapeutics that are designed to offer advantages over other currently
available treatments. There is a significant unmet medical need in the
treatment of both solid organ transplantation and autoimmune disease. It is
estimated that the market potential will exceed $4 billion annually in sales
for calcineurin inhibitors such as voclosporin by 2010.
    Voclosporin is a next generation calcineurin inhibitor, which completed a
Phase 2b North American trial for the prevention of kidney rejection following
transplantation. Extensions to the Phase 2b trial and a combined Phase 3
European/Canadian trial for the treatment of moderate to severe psoriasis have
also been completed. Our partner, Lux BioSciences, Inc., has also completed
three separate Phase 2/3 pivotal trials investigating voclosporin (referred to
as LUVENIQTM by Lux) for the treatment of uveitis. In addition to the uveitis
trials, Lux BioSciences Inc. has also commenced a Phase 1 trial using their
proprietary voclosporin ophthalmic solution (LX214) as a candidate for dry eye
syndrome. Voclosporin has also entered First-in-Man trials as the drug
utilized in the CINATRA(TM) Drug Coated Coronary Stent system developed by the
Company's partner, Atrium Medical Corporation.
    Isotechnika Pharma Inc. is a publicly traded company on the Toronto Stock
Exchange under the symbol "ISA". More information on Isotechnika Pharma can be
found at www.isotechnika.com or www.SEDAR.com.

    
    Forward-Looking Statements
    --------------------------
    
    This press release may contain forward-looking statements. Forward
looking statements, including the Company's belief as to the potential of its
products, the Company's expectations regarding the issuance of additional
patents and the Company's ability to protect its intellectual property,
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 research and development
projects, the ability to economically manufacture its products, the potential
of its products, the success and timely completion of clinical studies and
trials, the Company's ability to successfully commercialize its products, the
ability of the Company to defend its intellectual property rights from
infringement by third parties, and the risk that the Company's intellectual
property rights may be subsequently shown to be invalid or infringe the
patents of others. Investors should consult the Company's quarterly and annual
filings with the Canadian commissions for additional information on risks and
uncertainties relating to the forward-looking statements. Investors are
cautioned against placing undue reliance on forward-looking statements.

    
    Isotechnika Pharma Inc.
    Consolidated Interim Balance Sheets
    -------------------------------------------------------------------------

    (expressed in thousands of Canadian dollars)

                                                        June 30  December 31
                                                           2009         2008
                                                     (Unaudited)
                                                              $            $
    Assets

    Current assets
    Cash and cash equivalents                             7,330       25,701
    Accounts receivable                                     121          495
    Inventories                                               -          146
    Prepaid expenses                                        102          124
                                                     ------------------------

                                                          7,553       26,466
    Property and equipment                                2,506        3,206
    Intellectual property rights                          2,291        2,771
                                                     ------------------------

                                                         12,350       32,443
                                                     ------------------------
                                                     ------------------------
    Liabilities

    Current liabilities
    Accounts payable and accrued liabilities                852        3,984
    Current portion of deferred revenue                   2,094        1,330
    Current portion of long-term debt                         -        5,781
    Current portion of deferred lease inducements            16           16
                                                     ------------------------

                                                          2,962       11,111
    Deferred revenue                                      1,085        1,801
    Long-term debt                                            -        9,895
    Deferred lease inducements                               50           58
                                                     ------------------------

                                                          4,097       22,865
                                                     ------------------------


    Shareholders' Equity

    Share capital
    Common stock
      Authorized
        Unlimited number of common shares without
         par value
      Issued and outstanding
        131,214,804 shares
         (December 31, 2008 - 106,243,492)              195,929      192,706
    Warrants                                                171        3,293
    Contributed surplus                                   8,768        5,593
    Deficit                                            (196,615)    (192,014)
                                                     ------------------------

                                                          8,253        9,578
                                                     ------------------------

                                                         12,350       32,443
                                                     ------------------------
                                                     ------------------------



    Isotechnika Pharma Inc.
    Consolidated Interim Statements of Operations and Comprehensive Loss
    (Unaudited)
    -------------------------------------------------------------------------

    (expressed in thousands of Canadian dollars)

                               Three Months Ended         Six Months Ended
                              June 30      June 30      June 30      June 30
                                 2009         2008         2009         2008
                                    $            $            $            $

    Revenue
    Product sales and
     contract services            573          565        1,211        1,144
    Licensing revenue             102            -          281            -
    Diagnostic royalty income      43            -           43            -
                             ------------------------------------------------

                                  718          565        1,535        1,144
                             ------------------------------------------------

    Expenses
    Research and development    1,611        4,021        4,031        7,839
    Refundable tax credits       (117)           -         (117)           -
                                1,494        4,021        3,914        7,839
    Corporate, administration
     and marketing              1,356        1,583        2,400        3,067
    Cost of product sales and
     contract services            275          231          526          492
    Amortization of property
     and equipment                244          294          493          622
    Interest and prepayment
     on long-term debt            225           52        1,077           60
    Amortization and write-down
     of patent costs               33           56          211           82
    Loss (Gain) on disposal
     of equipment                  10           (2)         (45)          (5)
                             ------------------------------------------------

                                3,637        6,235        8,576       12,157
                             ------------------------------------------------

    Loss before the undernoted (2,919)      (5,670)      (7,041)     (11,013)
                             ------------------------------------------------

    Other income (expense)
    Investment income               9          157           34          417
    Foreign exchange
     translation gain (loss)       93           82           61         (172)
    Net gain from plan of
     arrangement                2,345            -        2,345            -
                             ------------------------------------------------

                                2,447          239        2,440          245
                             ------------------------------------------------

    Net loss for the period      (472)      (5,431)      (4,601)     (10,768)

    Other comprehensive income
     (loss)                         -            -            -            -
                             ------------------------------------------------

    Comprehensive loss for
     the period                  (472)      (5,431)      (4,601)     (10,768)
                             ------------------------------------------------
                             ------------------------------------------------
    Basic and diluted loss
     per share                      -        (0.05)       (0.04)       (0.10)
                             ------------------------------------------------
                             ------------------------------------------------
    

    %SEDAR: 00010508E




For further information:

For further information: Dr. Robert Foster, President & CEO, Isotechnika
Pharma Inc., (780) 487-1600 (247), (780) 484-4105 (fax),
rfoster@isotechnika.com; Mr. Dennis Bourgeault, Chief Financial Officer,
Isotechnika Pharma Inc., (780) 487-1600 (226), (780) 484-4105 (fax),
dbourgeault@isotechnika.com

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ISOTECHNIKA PHARMA INC.

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