Adherex Technologies Inc.

Adherex Technologies Inc.

March 21, 2005 08:02 ET

Adherex Reports 2004 Six-Month Fiscal Transition Results


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: ADHEREX TECHNOLOGIES INC.

TSX SYMBOL: AHX
AMEX SYMBOL: ADH

MARCH 21, 2005 - 08:02 ET

Adherex Reports 2004 Six-Month Fiscal Transition
Results

RESEARCH TRIANGLE PARK, NORTH CAROLINA--(CCNMatthews - March 21, 2005) -
Adherex Technologies Inc. (AMEX:ADH) (TSX:AHX), a biopharmaceutical
company with a broad portfolio of oncology products under development,
today reported its financial results for the six-month fiscal transition
period ended December 31, 2004.

"In January of this year, we announced a change in our fiscal year end
from June 30 to December 31. We took this step to, among other things,
align our fiscal year with that of most companies in our industry," said
Dr. William Peters, Chairman and CEO.

Financial Update

The net loss for the six-month fiscal transition period ended December
31, 2004 was $10.1 million, or $0.06 loss per share, compared to a net
loss of $4.9 million, or $0.06 loss per share, for the six-month period
ended December 31, 2003. Operating expenses totaled $9.2 million, an
increase of 85% over the same period last year. These operational
expenses primarily reflect the advancement of our portfolio, enabled by
the December 2003 Private Placement and the May 2004 Bought Deal,
including the continuation of the ADH-1 Phase I study at the Ottawa
Regional Cancer Centre, initiation of a further Phase I study site at
the M.D. Anderson Cancer Center in Houston, Texas, and preparation for
ADH-1 Phase Ib/II studies and Phase II studies.

Cash, cash equivalents and short-term investments totaled $21.1 million
as of December 31, 2004 compared to $27.7 million as of June 30, 2004,
with a corresponding decrease in working capital of $7.5 million. The
decreased cash balance reflects spending during the quarter to fund
operations.

Corporate Update

During and subsequent to the six-month fiscal transition period ended
December 31, 2004, Adherex's accomplishments of note included:

- Providing updated data from the Phase I ADH-1 (Exherin™) trial
being conducted in Canada and in the US. Over 56 courses of treatment
with the drug have been completed. We reported that ADH-1 has been well
tolerated, has very satisfactory drug characteristics, and, importantly,
has also displayed important evidence of anti-tumor activity in three
Phase I patients. Presentation of the complete results from the Phase I
trial will be presented at the American Society of Clinical Oncology
annual meeting in May of this year.

- Initiating a European Phase Ib/II trial of ADH-1 with active sites in
Switzerland and Italy studying a weekly dosing schedule.

- Obtaining a U.S. listing on the American Stock Exchange, providing us
with access to a much broader investment base.

- Completing the acquisition of Cadherin Biomedical Inc., bringing the
non-cancer applications of our cadherin platform back to Adherex.

- Completing the recruitment of our executive management team with the
appointment of Dr. Brian Huber as Chief Scientific Officer. Dr. Huber
brings more than 20 years of research and management experience in major
pharmaceutical companies to Adherex.

- Receiving four additional U.S. patents and one additional European
patent.

- Making presentations at seven U.S. and Canadian scientific and
investor conferences.

Peters continued, "During this period, we have steadily advanced our
clinical and preclinical programs. The anti-tumor activity which we
have seen in our Phase I trial of ADH-1 has persuaded us to modify and
accelerate our development plans for the drug. If the level of
anti-tumor therapeutic activity is sufficient as a single agent, the
ongoing and planned Phase Ib/II and Phase II trials should provide the
safety information and the estimates of expected range of therapeutic
effectiveness needed to design and conduct prospective randomized
pivotal Phase III trials. Our recently announced collaboration with the
NCI should also allow the exploration of the therapeutic value of using
our drug in combination with other anti-cancer agents, including
chemotherapy and biologics, using this non-dilutional type of funding
mechanism. In addition, the NCI collaboration is expected to provide
additional laboratory and preclinical information that will support our
efforts to gain regulatory approval. This year will be a very active one
for Adherex in the clinic as we continue to advance the development of
our drugs, as always, with a view to building shareholder value and
bringing important new medicines to patients and their physicians."

Conference Call

Adherex will host a conference call at 10:00 a.m. ET on Thursday, March
24, 2005 to review the financial results for the six-month fiscal
transition period ended December 31, 2004. This call will be webcast
live via the Internet at www.adherex.com. The event will also be
archived and available for telephone replay through March 29, 2005 and
webcast replay through June 24, 2005.

Live Participant Dial In (Toll Free, Canadian and US callers):
800-289-0746

Live Participant Dial In (International): 913-981-5573

Conference Passcode: 4336241

Replay Number (Toll Free): 888-203-1112

Replay Number (International): 719-457-0820

Replay Passcode: 4336241

About Adherex Technologies

Adherex Technologies Inc. is a biopharmaceutical company dedicated to
the discovery and development of novel cancer therapeutics. We aim to
be a leader in developing innovative treatments that address important
unmet medical needs in cancer. We currently have four products in the
clinical stage of development including ADH-1 (Exherin™) and sodium
thiosulfate (STS). ADH-1, our lead biotechnology compound, is an
angiolytic that selectively targets established blood vessels that feed
solid tumors. STS, a drug from our specialty pharmaceuticals pipeline,
protects against the disabling hearing loss that can often result from
treatment with platinum-based chemotherapy drugs. With a diversified
portfolio of unique preclinical and clinical-stage cancer compounds and
a management team with expertise in identifying, developing and
commercializing novel cancer therapeutics, Adherex is emerging as a
pioneering oncology company. For more information, please visit our
website at www.adherex.com.



Adherex Technologies Inc.
Selected Financial Data
(Canadian dollars in thousands except per share amounts)

December 31, June 30,
2004 2004
--------------------------------------------------------------------
Condensed Consolidated Balance Sheets:
Assets:
Cash, cash equivalents and short-term
investments $21,120 $27,748
Other current and long-term assets 1,235 1,759
Acquired intellectual property rights 24,572 26,132
--------------------------------------------------------------------
Total assets $46,927 $55,639
--------------------------------------------------------------------
--------------------------------------------------------------------

Liabilities and shareholders'equity:
Accounts payable and accrued liabilities $2,141 $1,966
Other current and long-term liabilities 169 124
Future income taxes 8,982 9,552
Total shareholders' equity 35,635 43,997
--------------------------------------------------------------------
Total liabilities and shareholders'equity $46,927 $55,639
--------------------------------------------------------------------
--------------------------------------------------------------------

Six Months Ended December 31,
--------------------------------------------------------------------
2004 2003
--------------------------------------------------------------------
Condensed Consolidated Statements of Operations: (unaudited)
Operating expenses:
Research and development $4,352 $1,958
General and administration 3,333 1,477
Amortization of acquired intellectual
property rights 1,560 1,560
--------------------------------------------------------------------
Loss from operations (9,245) (4,995)

Settlement of Cadherin Biomedical Inc.
litigation (1,622) -
Interest income (expense) - net 216 (428)
Recovery of future income taxes 570 570
--------------------------------------------------------------------
Net loss $(10,081) $(4,853)
--------------------------------------------------------------------
--------------------------------------------------------------------

Net loss per share of common stock, basic
and diluted $(0.06) $(0.06)
--------------------------------------------------------------------
--------------------------------------------------------------------


This press release contains forward-looking statements that involve
significant risks and uncertainties. The actual results, performance or
achievements of the Company might differ materially from the results,
performance or achievements of the Company expressed or implied by such
forward-looking statements. Such forward-looking statements include,
without limitation, those regarding the clinical development plans of
the Company, both alone and through collaborations, as well as the
expected benefits, timing and results. We can provide no assurance that
the clinical development will proceed as currently anticipated or that
expected benefits, timing or results will be realized. We are subject to
risks inherent in the biopharmaceutical industry, including the early
stage of our product candidates, the uncertainties of clinical trials
and regulatory review, our reliance on collaborations and our history of
losses. For a more detailed discussion of related risk factors, please
refer to our public filings available at www.sedar.com and www.sec.gov.

-30-

Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Adherex Technologies Inc.
    Melissa Matson
    Director, Corporate Communications
    (919) 484-8484
    matsonm@adherex.com