IntelGenx Technologies Corp.
OTC Bulletin Board : IGXT
TSX VENTURE : IGX

IntelGenx Technologies Corp.

March 30, 2011 06:00 ET

IntelGenx Reports 2010 Financial Results and Summarizes Key Developments

SAINT LAURENT, QUEBEC--(Marketwire - March 30, 2011) - IntelGenx Technologies Corp. (TSX VENTURE:IGX)(OTCBB:IGXT) ("IntelGenx") today reported its financial results for the fourth quarter and fiscal year ended December 31, 2010 and provided a summary of key financial and operational developments. All amounts are denominated in U.S. dollars, unless otherwise stated.

FISCAL YEAR FINANCIAL HIGHLIGHTS:

Cash and cash equivalents at December 31, 2010 were approximately $1.1 million compared to approximately $1.5 million at December 31, 2009.

Net cash provided by financing activities was approximately $2.1 million in fiscal 2010 compared with approximately $2.1 million the previous year.

Revenue and other income totalled $1.3 million in the year ended December 31, 2010 compared to $1.3 million in the year ended December 31, 2009.

Total expenses increased by approximately $1.1 million to $4.4 million in fiscal 2010. The increase includes approximately $1.1 million related to legal expenses incurred in the defense of the patent infringement lawsuit filed in August 2009 by Biovail Laboratories SLR ("Biovail") in the U.S. District Court of Delaware that was subsequently dismissed by the Court on February 3, 2011.

The loss per common share increased by $0.01 to $0.08 in 2010 (2009: loss of $0.07).

"Fiscal 2010 was a defining year for the company. Although we spent the year under the cloud of the Biovail litigation, we were unwavering in our belief that this proceeding would end in our favour. Our perseverance in robustly defending CPI-300 was rewarded after year-end with a positive outcome from the Markman hearing and the subsequent dismissal of the case in February 2011. This decision now paves the way for the imminent submission of our response to the FDA's Complete Response Letter for CPI-300 which, in our opinion, should lead to an approval and commercial launch later this year," commented Dr. Horst G. Zerbe, President and CEO of IntelGenx.

Dr. Zerbe added, "Although many people will remember fiscal 2010 by the litigation, we believe the most important accomplishment of the company was the acceleration of our thin film business. We emerged from this past fiscal year with two film products successfully tested in man and a third in clinical trials, our first development partnership for a thin film, and an industry leading pipeline of future thin film products. Through our work in the past fiscal year, we are now positioned to push several other thin films products forward and to expand our development and/or commercialization partnerships."

Key Developments:

Private Placement Financing:

On August 27, 2010 we announced the closing of a private placement offering of 6,500,000 units, raising gross proceeds of CAD$2.6 million.

CPI-300 Antidepressant Tablet:

Background:

CPI-300 is a higher strength of the antidepressant bupropion HCl, the active ingredient in Wellbutrin XL®.

In April 2009 we submitted a New Drug Application ("NDA") to the FDA for CPI-300. 

In August 2009 Biovail filed suit against us in the U.S. District Court of Delaware for patent infringement, under the provisions of the "Hatch-Waxman Act", with respect to Biovail's U.S. Patent No. 6,096,341.

In January 2010, due to bankruptcy of the former manufacturing site, we announced a manufacturing site change for CPI-300 and identified Pillar5 Pharma Inc. ("Pillar5") as the new manufacturing facility.

In February 2010 we received a Complete Response Letter ("CRL") from the FDA which lists two main issues which need to be addressed before obtaining final approval: 1) qualification of Pillar5 as the commercial manufacturing site and 2) an observed food effect, which was seen with CPI-300 and the reference product.

In March 2010 the U.S. Patent and Trademark Office issued patent number US 7,674,479 for CPI-300. The patent will be listed in the FDA's Orange Book and will provide broad protection for CPI-300 against generic copies.

In May 2010 we acquired from Cary Pharmaceuticals ("Cary"), our former development partner, Cary's 50% ownership stake in CPI-300 along with all rights to, and interest in, all regulatory aspects, including the NDA, and we assumed responsibility for the costs associated therewith.

In June 2010 we met with the FDA to discuss our response to the CRL, who confirmed that it agrees with the clinical plan that we proposed to address the previously observed food effect and to demonstrate bioequivalency of product manufactured at the new manufacturing site.

Subsequent to the end of fiscal 2010, in January 2011 we learned that the United States District Court of Delaware had ruled in our favour regarding the two patent terms at issue in the patent infringement action brought forward by Biovail.

Subsequent to the end of fiscal 2010, in February 2011 we learned that the Court had dismissed the lawsuit against us.

Neuropathic Pain Tablet:

Background:

In April 2009 we announced, together with our former development partner, Cynapsus Therapeutics Inc. (formerly Cannasat Therapeutics Inc., "Cynapsus"), positive Phase 1b results for INT0010, a buccal formulation of THC (dronabinol) for the symptomatic management of Multiple Sclerosis (MS) induced neuropathic pain and chemotherapy induced nausea.

Progress in fiscal 2010:

In March 2010 we executed a Letter of Intent with Cynapsus under which we would acquire a fifty-percent ownership stake in, and an exclusive worldwide license to develop and commercialize, INT0010.

In November 2010 we acquired exclusive rights to, and ownership of, INT0010. Under the terms of a royalty based licensing agreement with PediPharm Ltd., we obtained worldwide rights to US Patent 7,592,328 and all corresponding foreign patents and patent applications to exclusively develop and further provide intellectual property protection for INT0010.

In December 2010 we executed a license agreement with Cynapsus, whereby, for forgiveness of debt and a royalty on future sales of the product, we acquired full control of, and interest in, INT0010 going forward.

Anti-Migraine Film:

In April 2010 we executed a binding term-sheet with RedHill Biopharma Ltd., an Israeli corporation ("RedHill"), to co-develop and license IntelGenx' first oral thin film product based upon our proprietary VersaFilm technology. The product is intended for the rapid relief of migraine headaches.

In August 2010 we executed a co-development and commercialization agreement with RedHill under which RedHill has obtained certain exclusive worldwide rights to market and sell, either itself or through a commercial partner, our rapidly dissolving anti-migraine oral film product. In return, we will receive upfront, milestone and external development fees totalling up to $2.1 million from RedHill.

Erectile Dysfunction Film:

In September 2010 we completed a pilot study that indicates that we have successfully developed a novel oral film, INT007, which is likely to be bioequivalent, in a pivotal bioequivalency study, to a leading branded tablet containing a phosphodiesterase type 5 (PDE-5) inhibitor for the treatment of erectile dysfunction. INT007 has been developed using our proprietary immediate release VersaFilm drug delivery technology.

Anti-Psychotic Film:

Subsequent to the end of the fiscal year, in February 2011 we completed a pilot study that indicates that we have successfully developed a novel oral film, INT0022, which is likely to be bioequivalent to a leading anti-psychotic in a pivotal bioequivalency study. INT0022 has been developed using our proprietary immediate release "VersaFilm" drug delivery technology.

VersaFilm Manufacturing:

In January 2010 we formed a strategic alliance with LTS Lohmann Therapie-Systeme AG ("LTS") for the exclusive manufacturing of pharmaceutical products developed by us using our VersaFilm drug delivery technology.

Manufacturing Partnership and Ownership Position in Manufacturing Facility:

In April 2010 we executed an agreement with Pillar5 Pharma Inc. ("Pillar5") whereby we undertake to use our best efforts to ensure that distributors of our oral solid dose pharmaceutical products developed for commercial production be directed to Pillar5 for purposes of negotiating a manufacturing agreement requiring Pillar5 to manufacture those products. As consideration for this undertaking, Pillar5 issued 114 voting common shares of Pillar5 to us, representing 10% of the issued and outstanding shares of Pillar5. The shares will be held in escrow and are forfeitable by us until or unless Pillar5 achieves certain revenue targets from the manufacture of products licensed by us, and are subject to restrictions on transfer.

About IntelGenx:

IntelGenx is a drug delivery company focused on the development of oral controlled-release products as well as novel rapidly disintegrating delivery systems. IntelGenx uses its unique multiple layer delivery system to provide zero-order release of active drugs in the gastrointestinal tract. IntelGenx has also developed novel delivery technologies for the rapid delivery of pharmaceutically active substances in the oral cavity based on its experience with rapidly disintegrating films. IntelGenx' research and development pipeline includes products for the treatment of pain, hypertension, erectile dysfunction and depressive disorders. More information is available about the company at www.intelgenx.com.

Forward Looking Statements:

This document may contain forward-looking information about IntelGenx' operating results and business prospects that involve substantial risks and uncertainties. Statements that are not purely historical are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended. These statements include, but are not limited to, statements about IntelGenx' plans, objectives, expectations, strategies, intentions or other characterizations of future events or circumstances and are generally identified by the words "may," "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," "could," "would," and similar expressions. All forward looking statements are expressly qualified in their entirety by this cautionary statement. Because these forward-looking statements are subject to a number of risks and uncertainties, IntelGenx' actual results could differ materially from those expressed or implied by these forward looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed under the heading "Risk Factors" in IntelGenx' annual report on Form 10-K for the fiscal year ended December 31, 2010, filed with the United States Securities and Exchange Commission and available at www.sec.gov, and also filed with Canadian securities regulatory authorities and www.sedar.com. IntelGenx assumes no obligation to update any such forward-looking statements.

Each of the TSX Venture Exchange and OTC Bulletin Board has neither approved nor disapproved the contents of this press release.

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