Protox reports 2008 second quarter results



    VANCOUVER, Aug. 11 /CNW/ - Protox Therapeutics Inc. (TSX: PRX), a leader
in the development of receptor targeted fusion proteins, today released second
quarter 2008 financial results for the three months ended June 30, 2008 ("2008
Q2").
    "Protox continues to build on the success of the first quarter as the
Company enrolls patients in two Phase 2 clinical trials of PRX302 for prostate
cancer and benign prostatic hyperplasia (BPH). With the successful financing
completed in May, Protox has been able to expedite the PRX302 BPH program and
expect to complete enrollment ahead of schedule." said Dr. Fahar Merchant,
President and CEO of Protox. "Furthermore, Protox looks forward to commencing
the Phase 2b pre-pivotal PRX321 recurrent brain cancer trial in the second
half of this year

    
    2008 Q2 Highlights

    -   Granted Orphan Drug Designation for PRX321 for the treatment of
        glioma, the most common and aggressive type of brain cancer, by the
        European Medicines Agency (EMEA)

    -   Closed a brokered private placement of common shares for gross
        proceeds totaling approximately $4.8 million, including $1.8 million
        from the exercise of an over-allotment option by the agent

    -   Encouraging early data from the PRX302 Phase 1 BPH clinical study was
        presented by Principal Investigator Dr. Pommerville at the 2008
        Annual Meeting of the American Urological Association (AUA) held in
        Orlando, Florida

    -   Announced positive data from the Phase 1 BPH study demonstrating that
        PRX302 provides safe and durable symptomatic relief for at least 6
        months following a single treatment

    -   Following Health Canada and IRB approvals, commenced patient dosing
        in a Phase 2 clinical trial of PRX302 for the treatment of BPH

    -   Commenced patient dosing for a Phase 2a study of PRX302 for the
        treatment of localized recurrent prostate cancer

    -   Entered into a collaboration with Dr. Raj Puri of the FDA under the
        terms of a CRADA for further development of PRX321 and novel IL-4
        receptor targeted therapeutics
    

    FINANCIAL RESULTS

    Protox has not earned any revenue in any of its previous fiscal years,
other than income from interest earned on the Company's cash balances. During
2008 Q2 and the six months ended June 30, 2008 ("2008 YTD") the Company earned
interest income of $0.05 million and $0.14 million, respectively, compared to
$0.1 million and $0.19 million for the corresponding 2007 comparative periods.
The decrease in interest income is directly attributable to lower interest
rates available for both interest bearing short-term investments and accounts
earned during 2008 on average cash balances approximating those during the
first half of 2007.
    The Company reported a net loss for 2008 Q2 of $1.9 million or $0.03 per
share compared to $1.8 million or $0.03 per share for the three months ended
June 30, 2007 comparative period ("2007 Q2"). The net loss for 2008 YTD
totaled $3.9 million or $0.06 per share compared to $3.4 million or $0.06 per
share for the six months ended June 30, 2006 ("2007 YTD").
    Research and development ("R&D") costs of nearly $1.2 million were
incurred during 2008 Q2 compared to $1.1 million for the 2007 Q2 comparative
period. Although similar in amount, 2008 Q2 R&D costs reflect expenditures
related to the PRX302 BPH and prostate cancer Phase 2 clinical trials as well
as CMC, clinical and regulatory preparatory activities for the anticipated
PRX321 recurrent GBM Phase 2b study, as compared to ongoing study costs for
the BPH and prostate cancer Phase 1 clinical trials that were active during
the comparative 2007 Q2 period.
    R&D costs for the 2008 YTD period totaled $2.6 million representing an
approximate $0.5 million (24%) increase from $2.1 million incurred during the
2007 YTD comparative period. The increase reflects the carry-over effect of
the expanded scope of Protox's drug development and clinical trial activities
during 2008 Q1, during which incremental costs were incurred for the PRX321
program relating to the anticipated 2008 H2 recurrent GBM Phase 2b study
whereas there were no related activities during 2007 Q1.
    Direct costs for the PRX302 prostate cancer and BPH clinical programs,
including 2 active Phase 2 clinical trials, and PRX321 recurrent GBM Phase 2b
study preparatory and CMC drug supply activities increased to approximately
$0.6 million during 2008 Q2 from approximately $0.5 million for 2007 Q2,
contributing 46% of the overall quarter-to-quarter increase in R&D costs.
Discovery research costs for 2008 Q2 were $0.22 million compared to $0.16
million for 2007 Q2, reflecting incremental costs associated with additional
CRADA and collaborative research activity.
    General and administrative (G&A) costs for 2008 Q2 remained steady from
last quarter at $0.55 million, however, increased 17% from $0.47 million
incurred during the 2007 Q2 comparative period. YTD G&A costs have also
increased but slightly less at 13% to $1.1 million from $0.96 million for the
2007 YTD comparative period. G&A costs will generally vary from period to
period depending on the specific business development, market research and
shareholder relations initiatives undertaken and related travel required at
such time to support the Company's corporate objectives. The 2008 Q2 and 2008
YTD G&A costs increase is commensurate with the growth of the Company and its
operations and also reflects an increase in business development personnel and
activities.
    During 2008 Q2 and 2008 YTD, the Company recorded nominal foreign
exchange losses as the relative value of the U.S. and Canadian dollar changed
marginally. However, during the 2007 Q2 and 2007 YTD comparative periods,
$0.17 and $0.19 million of losses were recorded respectively with the majority
representing unrealized losses on the Company's then more significant U.S.
dollar reserves due to an approximate 10% relative decline in the value of the
U.S. dollar during 2007 Q2 alone. With U.S. dollar reserves considerably less
as at June 30, 2008 compared to a year ago, the majority of the unrealized
losses previously provided for as of 2007 Q2 have now been realized in the
normal course of operations from the payment of ongoing U.S. dollar
denominated expenses. The foreign exchange loss or gain recorded for a
particular period and difference between comparative periods is a function of
prevailing foreign exchange rates in effect at such time compared to the
comparative period(s) as well as the amount of net financial assets or
liabilities held or transacted during the subject periods.
    At June 30, 2008, the Company had cash and cash equivalents of $11.4
million, mirroring closely the balance as at December 31, 2007. The Company
had working capital of $10.8 million at June 30, 2008, an increase of $0.9
million from the December 31, 2007 year end. During 2008 Q2 the Company closed
a brokered private placement of its common shares raising approximately $4.8
million from the issuance of approximately 6.9 million common shares. Gross
proceeds included approximately $1.8 million from the exercise of an
over-allotment option by the agent. The additional cash resources from the
successful private placement will enable the Company to accelerate clinical
programs and development activities.
    As at August 11, 2008, the Company has 75,843,943 common shares issued
and outstanding. In addition, the Company has 5,441,035 options outstanding to
purchase common shares of the Company. Of the options currently outstanding,
approximately 3.4 million are exercisable into an equivalent number of common
shares of the Company at exercise prices ranging from $0.50 to $1.00 and with
an average exercise price of $0.79. The Company also has warrants outstanding
entitling warrant holders to purchase common shares as follows: i) 10,938,882
warrants with an exercise price of $0.65 per common share and an expiry date
of either November 29, 2008 or December 22, 2008 and ii) 584,413 warrants with
an exercise price of $0.71 and expiry date of May 23, 2010.
    For complete financial results, please see our filings at www.sedar.com.

    About Protox

    Protox Therapeutics is a leader in advancing novel, receptor targeted
fusion proteins. Two novel drug candidates derived from the company's
INxin(TM) and PORxin(TM) platforms are being developed in three clinical
programs. A Phase 2a clinical trial evaluating PRX321 (INxin) for the
treatment of primary brain cancer has been completed and the drug has received
Fast Track Designation and Orphan Drug Status from the US FDA. Phase 2a
clinical trials evaluating PRX302 (PORxin) for the treatment of localized
prostate cancer and benign prostatic hyperplasia (enlarged prostate) have also
been initiated. Protox is also collaborating with the U.S. National Institutes
of Health (NIH) on a research program focused on the discovery of next
generation fully human targeted therapeutics.

    Certain statements included in this press release may be considered
forward-looking. Such statements involve known and unknown risks,
uncertainties and other factors that may cause actual results, performance or
achievements to be materially different from those implied by such statements,
and therefore these statements should not be read as guarantees of future
performance or results. All forward-looking statements are based on Protox'
current beliefs as well as assumptions made by and information currently
available to Protox and relate to, among other things, anticipated financial
performance, business prospects, strategies, regulatory developments, market
acceptance and future commitments. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as of the date
of this press release. Due to risks and uncertainties, including the risks and
uncertainties identified by Protox in its public securities filings; actual
events may differ materially from current expectations. Protox disclaims any
intention or obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.





For further information:

For further information: James Beesley, Director, Investor Relations,
Protox Therapeutics, (604) 484-0975, jbeesley@protoxtherapeutics.com; Michael
Moore, Investor Relations, Equicom Group, (416) 815-0700 x 241,
mmoore@equicomgroup.com

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