ConjuChem Biotechnologies Announces Fiscal 2007 First Quarter Financial Results

    MONTREAL, March 8 /CNW/ - ConjuChem Biotechnologies (TSX:CJB) today
announced financial results for its first quarter of fiscal 2007, ended
January 31, 2007.
    The Company's net loss for the quarter ended January 31, 2007 was
$18.6 million, or ($0.10) per share, compared with $10.0 million, or ($0.21)
per share, for the quarter ended January 31, 2006. The increase in the net
loss is mainly attributable to an increase in net research and development
expenses of $9.5 million. This increase is largely the result of a raw
material purchase made during the quarter for the manufacturing of
PC-DAC(TM):Exendin-4. The raw material purchased should be sufficient to
supply the Company's requirements for the balance of 2007, including
supporting upcoming clinical trials and additional toxicity studies required
for Phase III.
    "Our commitment to advancing PC-DAC(TM):Exendin-4 is reflected in an
elevated burn rate this quarter. This increase is a result of a large raw
material purchase and related manufacturing costs which will enable us to
address the requirements of further clinical trials and Phase III enabling
studies. Anticipated spending will return to previous levels in the coming
quarters," said Lennie Ryer, Vice-President and CFO.
    The Company recorded interest income on cash, short and long-term
investments of $862,330 for the quarter versus $80,886 in the same period last
year. The increase in interest revenue was a result of the investment
portfolio available subsequent to the November 2006 financing initiative.
    Net research and development expenses amounted to $15.8 million for the
quarter ended January 31, 2007, compared with $6.2 million in the same period
last year. This increase is explained above and relates to the purchase of raw
materials to manufacture PC-DAC(TM):Exendin-4.
    General and administrative costs for the quarter ended January 31, 2007
were $825,448 compared with $1.2 million for the same period last year. The
decrease in these expenses is attributable to the non-recurring expense of
recruiting and relocating ConjuChem's new President and new Executive
Vice-President in 2006.
    As of January 31, 2007, the Company had cash and cash equivalents of
$54.9 million and a working capital position of $39.1 million. The Company
significantly improved its liquidity on November 28, 2006, when it closed a
public offering of units resulting in net proceeds of approximately
$113,601,384.

    About ConjuChem Biotechnologies Inc.

    ConjuChem, developer of next generation medicine 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. A
detailed description of the Company can be viewed on the Company's website at
www.conjuchem.com.


    
    ConjuChem Biotechnologies Inc.

                               BALANCE SHEETS

    As at


                                                   January 31,    October 31,
                                                         2007           2006
                                                            $              $
    -------------------------------------------------------------------------
    ASSETS
    Current
    Cash and cash equivalents                      22,304,921      4,034,937
    Short-term investments available-for-sale      32,560,241      7,244,401
    Accounts receivable and other assets              511,858        394,758
    Investment tax credits receivable                 700,000        550,000
    Prepaid expenses                                  141,780        288,746
    -------------------------------------------------------------------------
    Total current assets                           56,218,800     12,512,842
    Deferred financing fees                                 -         74,675
    Property, plant and equipment                   1,164,479      1,161,886
    Intangible assets                                  31,514         33,068
    Long-term investments held-to-maturity         58,037,211              -
    -------------------------------------------------------------------------
                                                  115,452,004     13,782,471
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    LIABILITIES AND SHAREHOLDERS' EQUITY
    (DEFICIENCY)
    Current liabilities
    Accounts payable and accrued liabilities       17,110,074     12,862,582
    -------------------------------------------------------------------------
    Total current liabilities                      17,110,074     12,862,582
    Convertible senior unsecured notes             46,907,247     45,276,400
    -------------------------------------------------------------------------
                                                   64,017,321     58,138,982
    -------------------------------------------------------------------------

    Shareholders' equity (deficiency)
    Capital stock                                 265,335,640    162,017,141
    Warrants                                       11,885,875      3,276,000
    Equity portion of convertible senior
     unsecured notes                               14,966,780     14,966,780
    Contributed surplus                            24,970,104     22,466,527
    Deficit                                      (265,712,922)  (247,082,959)
    Accumulated other comprehensive income            (10,794)             -
    -------------------------------------------------------------------------
    Total shareholders' equity (deficiency)        51,434,683    (44,356,511)
    -------------------------------------------------------------------------
                                                  115,452,004     13,782,471
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    ConjuChem Biotechnologies Inc.

                            STATEMENTS OF DEFICIT


    Three months ended January 31,

                                                         2007           2006
                                                            $              $
    -------------------------------------------------------------------------

    Deficit, beginning of period                 (247,082,959)  (200,918,066)
    Net loss for the period                       (18,629,963)    (9,951,119)
    -------------------------------------------------------------------------
    Deficit, end of period                       (265,712,922)  (210,869,185)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    ConjuChem Biotechnologies Inc.

                           STATEMENTS OF OPERATIONS


    Three months ended January 31,

                                                         2007           2006
                                                            $              $
    -------------------------------------------------------------------------

    REVENUES
    Contract revenue                                        -        239,123
    Interest income                                   862,330         80,886
    -------------------------------------------------------------------------
                                                      862,330        320,009
    -------------------------------------------------------------------------

    EXPENSES
    Research and development                       15,901,773      6,276,999
    Investment tax credits                           (150,000)       (75,000)
    -------------------------------------------------------------------------
    Net research and development expenses          15,751,773      6,201,999
    General and administrative expenses               825,448      1,203,960
    Amortization of property, plant and equipment      62,666         72,814
    Amortization of intangible assets                   4,305         14,486
    Amortization of deferred financing fees             8,722          8,722
    Non-cash stock-based compensation                 830,567      1,339,491
    Financial charges                                   4,677          3,673
    Foreign exchange loss                             307,335            184
    Accretion in carrying value of convertible
     senior unsecured notes                         1,696,800      1,425,799
    -------------------------------------------------------------------------
                                                   19,492,293     10,271,128
    -------------------------------------------------------------------------
    Net loss for the period                       (18,629,963)    (9,951,119)

    Other comprehensive income
    Unrealized loss on available-for-sale
     short-term investments                            10,794              -
    -------------------------------------------------------------------------
    Comprehensive loss for the period             (18,640,757)    (9,951,119)
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------

    Basic and diluted loss per share                    (0.10)         (0.21)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Weighted average number of common shares
     outstanding                                  183,902,987     47,555,569
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    ConjuChem Biotechnologies Inc.

                           STATEMENTS OF CASH FLOWS


    Three months ended January 31,

                                                         2007           2006
                                                            $              $
    -------------------------------------------------------------------------
    OPERATING ACTIVITIES
    Net loss                                      (18,629,963)    (9,951,119)
    Items not affecting cash:
    Amortization of property, plant and equipment      62,666         72,814
    Amortization of intangible assets                   4,305         14,486
    Amortization of deferred financing fees             8,722          8,722
    Amortization of discount on long-term
     investments                                      (15,187)         2,330
    Non-cash stock based compensation                 830,567      1,339,491
    Accretion in carrying value of convertible
     senior unsecured notes                         1,696,800      1,425,799
    -------------------------------------------------------------------------
                                                  (16,042,090)    (7,087,477)
    Net changes in non-cash working capital
     balances relating to operations                3,324,373       (754,840)
    -------------------------------------------------------------------------
    Cash flows relating to operating activities   (12,717,717)    (7,842,317)
    -------------------------------------------------------------------------
    INVESTING ACTIVITIES
    Acquisition of short-term investments         (36,990,935)    (4,589,194)
    Proceeds on maturities of short-term
     investments                                   11,664,301     16,629,437
    Acquisition of property, plant and equipment      (65,259)      (112,053)
    Acquisition of intangible assets                   (2,751)             -
    Acquisition of long-term investments          (57,219,039)             -
    -------------------------------------------------------------------------
    Cash flows relating to investing activities   (82,613,683)    11,928,190
    -------------------------------------------------------------------------
    FINANCING ACTIVITIES
    Issuance of units for cash                    120,250,000          3,847
    Issuance costs                                 (6,648,616)             -
    -------------------------------------------------------------------------
    Cash flows relating to financing activities   113,601,384          3,847
    -------------------------------------------------------------------------

    Net increase in cash and cash equivalents
     during the period                             18,269,984      4,089,720
    Cash and cash equivalents, beginning of
     period                                         4,034,937        137,218
    -------------------------------------------------------------------------
    Cash and cash equivalents, end of period       22,304,921      4,226,938
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Supplemental cash flow information:
    Cash paid during the period for interest:           1,273            107
    -------------------------------------------------------------------------
    

For further information:

For further information: Lennie Ryer, CA, Vice President Finance, CFO,
ConjuChem Biotechnologies Inc., (514) 844-5558 ext 224, ryer@conjuchem.com;
Michael Polonsky, Investor Relations, (416) 815-0700 ext. 231, (416) 815-0080,
mpolonsky@equicomgroup.com