Adherex Technologies Inc.
TSX : AHX
AMEX : ADH

Adherex Technologies Inc.

November 12, 2008 08:37 ET

Adherex Reports Third Quarter 2008 Financial Results

Announces Development Update and Prioritization Initiative

RESEARCH TRIANGLE PARK, NORTH CAROLINA--(Marketwire - Nov. 12, 2008) - Adherex Technologies Inc. (TSX:AHX)(AMEX:ADH), a biopharmaceutical company dedicated to solving problems for patients with cancer, today reported its financial results for the third quarter ended September 30, 2008. All amounts are in U.S. dollars.

Financial Update

The net loss for the three month period ended September 30, 2008 was $3.2 million, or a loss of $0.03 per share, compared to a net loss of $3.2 million, or a loss of $0.02 per share, in the same period in 2007. Operating expenses for the three month period ended September 30, 2008 totaled $3.3 million as compared to $3.5 million in the same period in 2007.

The net loss for the nine-month period ended September 30, 2008 was $11.0 million, or a loss of $0.09 per share, compared to a net loss of $10.3 million, or a loss of $0.09 per share, for the same period in 2007.

Cash and cash equivalents totaled $7.9 million as of September 30, 2008, compared to $16.2 million at December 31, 2007, with a corresponding decrease in working capital of $8.9 million. The decreased cash balance reflects expenditures used to fund operations. With the implementation of the prioritization initiative as outlined below, the Company believes that it has sufficient capital resources to carry out currently planned development and operational activities through September 30, 2009.

Corporate Update

Adherex also announced that it has implemented a prioritization initiative to focus its clinical development activities on the most attractive, nearer term value-generating opportunities. Accordingly, the Company has begun a process of postponing or, in certain cases, terminating some of its ongoing or previously planned clinical development programs. This process included the closure of enrollment in the Phase 1/2 trial for eniluracil in liver cancer in Asia. This trial had enrolled a total of nine patients. Further, patient enrollment in the ongoing U.S. Phase I trial of eniluracil intended to determine the maximum tolerated dose (MTD) of oral 5-fluorouracil (5-FU) in combination with eniluracil will be temporarily suspended. A total of 41 patients have been enrolled in this trial to date. Finally, plans to start a Phase 2 trial with eniluracil in breast cancer, a Phase 3 trial with ADH-1 in combination with melphalan in melanoma and a Phase 3 trial with sodium thiosulfate (STS) in adult head and neck cancer in the United States have all been indefinitely postponed pending the establishment of a partnership for these products or other sufficient funding activity.

"While our drug development has been proceeding well and we believe that there is substantial opportunity for each of the products, the current market conditions dictate that we focus and align our development strategy with the financial resources that we currently have available. By streamlining our activities and utilizing creative development approaches, we expect to extend our current cash resources and maximize our opportunity to create nearer term value-enhancing data while continuing to seek partnerships or other funding opportunities for our products," said Dr. William P. Peters, Chairman and CEO of Adherex.

"Although we have had to make some logical and prudent decisions to slow down or stop some of our development programs, the addition of a number of investigator-initiated trials will help ensure the continued advancement of our products and may even provide for a nearer term product opportunity. For example, the investigator-initiated approach using a topical eniluracil formulation has already produced preclinical data demonstrating the feasibility of such a strategy," said Dr. Peters. "If successful, this topical approach would address a significant clinical need in oncology and represents a novel and substantially abbreviated development path."

The current development plans thus now include:

- Continuation of the ongoing Phase 3 trials of STS with COG and SIOPEL which we believe will provide efficacy data necessary for potential early approval strategies.

- Completion of the ongoing Phase 2b trial of ADH-1 in combination with melphalan for melanoma. This trial has accrued 47 patients to date and will complete patient accrual at the end of November. Patients will then be followed for the required three months for response assessment. This information will provide an expanded Phase 2b clinical data set to further potential partnering opportunities.

- The addition of an investigator-initiated clinical trial where eniluracil is being studied topically for the prevention of hand-foot syndrome (HFS) induced by capecitabine (Xeloda®). This approach provides a relatively cost-effect and rapid development strategy with near-term efficacy data possible.

- The addition of investigator-initiated clinical trials with ADH-1 in lung and pancreatic cancer in combination with chemotherapy and other biologic therapies, further expanding the potential applications for this drug.

The selected financial data presented below are derived from the Company's interim unaudited consolidated financial statements for the period ended September 30, 2008 included in its Quarterly Report on Form 10-Q, which is available on the Company's website at www.adherex.com and also at www.sec.gov.

About Adherex Technologies

Adherex Technologies Inc. is a biopharmaceutical company dedicated to the discovery and development of novel cancer therapeutics. We are in the business of solving problems for patients with cancer. We have multiple products in the clinical stage of development, including eniluracil, ADH-1 and sodium thiosulfate (STS). Eniluracil, an oral dihydropyrimidine dehydrogenase (DPD) inhibitor, is being developed to improve the tolerability and effectiveness of 5-fluorouracil (5-FU), one of the most widely used oncology drugs in the world. ADH-1 is a biotechnology compound which selectively targets N-cadherin, a protein present on certain tumor cells and the blood vessels of solid tumors. STS is a chemoprotectant being developed to reduce or prevent hearing loss that may 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 aims to become a leader in developing innovative treatments that address important unmet medical needs in cancer. For more information, please visit our website at www.adherex.com.

FINANCIAL CHARTS FOLLOW



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

September 30, December 31,
Condensed Consolidated Balance Sheets: 2008 2007
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Assets:
Cash and cash equivalents $7,937 $16,217
Other current assets 264 344
Long-term assets 457 648
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Total assets $8,658 $17,209
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Liabilities and stockholders' equity:
Accounts payable and accrued liabilities $2,904 $2,402
Other long-term liabilities 600 659
Total stockholders' equity 5,154 14,148
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Total liabilities and stockholders' equity $8,658 $17,209
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Condensed Consolidated Statements of Operations:

Three Months Ended Nine Months Ended
September 30, September 30, September 30, September 30,
2008 2007 2008 2007
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Revenue $- $- $- $-

Operating expenses:
Research and
development 2,821 2,490 8,768 8,293
General and
administrative 478 966 2,478 2,717
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Loss from operations (3,299) (3,456) (11,246) (11,010)
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Interest income 55 254 256 661
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Net loss $(3,244) $(3,202) $(10,990) $(10,349)
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Basic and diluted
net loss per common
share $(0.03) $(0.02) $(0.09) $(0.09)
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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 our development plans and the expected funding, timing and results of our development as well as our efforts to pursue collaborations or partnerships. We can provide no assurance that development will proceed as currently anticipated, that previous results will be predictive of future outcomes, that the expected funding, timing or results of our development will be realized, or that we will be able to form collaborations or partnerships with other companies. We are subject to various risks, including our need for additional capital to fund our operations, our history of losses, current and anticipated conditions in the economy and financial markets, our ability to continue to meet the listing requirements of either the AMEX or TSX, the uncertainties of clinical trials, drug development and regulatory review, the early stage of our product candidates, our reliance on collaborative partners, and other risks inherent to the biopharmaceutical industry. For a more detailed discussion of related risk factors, please refer to our public filings available at www.sedar.com and www.sec.gov.

Contact Information

  • Adherex Technologies Inc.
    D. Scott Murray
    Senior Vice President, Corporate Development
    919-484-8484
    info@adherex.com