SOURCE: Titan Pharmaceuticals, Inc.

Titan Pharmaceuticals, Inc.

November 15, 2011 07:00 ET

Titan Pharmaceuticals Announces Third Quarter 2011 Financial Results

Titan Management Team to Host Conference Call Nov. 17 at 10:00 a.m. PT/1:00 p.m. ET

SOUTH SAN FRANCISCO, CA--(Marketwire - Nov 15, 2011) - Titan Pharmaceuticals, Inc. (OTCBB: TTNP) today reported financial results for the third quarter ended September 30, 2011.

Total revenues for the third quarter of 2011 were approximately $1.0 million, consisting of $973,000 in royalties on net sales of Fanapt® and $39,000 in grant revenues from the National Institutes of Health (NIH) in support of the confirmatory Phase 3 clinical study of Probuphine and the Small Business Innovation Research (SBIR) grant for Titan's proprietary ProNeura™ drug delivery technology.

Total operating expenses for the third quarter of 2011 were approximately $3.0 million, compared with approximately $3.7 million for the third quarter of 2010. The year-over-year decrease in expenses resulted primarily from a decrease of approximately $0.8 million in research and development (R&D) expense due to the reduced expenditure associated with the recently completed confirmatory Phase 3 clinical study of Probuphine.

Net other income for the three-month period ended September 30, 2011 was approximately $1.2 million, compared to an expense of approximately $0.2 million in the comparable period in 2010. The increase in net other income during the quarter was primarily related to a $2.4 million non-cash gain resulting from a decrease in the fair value of the stock warrants issued to Deerfield Management, which was offset in part by interest expense of approximately $1.2 million on the Deerfield loans.

Net loss for the third quarter of 2011 was approximately $0.8 million or $0.01 per share compared with a net loss of approximately $0.4 million or $0.01 per share for the third quarter of 2010.

At September 30, 2011, Titan had cash and cash equivalents of approximately $2.8 million. On November 14, 2011, the Company entered into agreements with Deerfield Management pursuant to which it agreed to sell a substantial portion of the balance of its Fanapt royalty stream to Deerfield in exchange for $5.0 million in cash, a $10.0 million reduction in the principal amount owed to Deerfield under its existing facility agreement and a revised debt repayment schedule of four equal annual payments with the first payment delayed by a year to April 2013. Additional details of this transaction are provided in a separate press release issued this morning. Funding is expected to occur on or about November 30, 2011 and together with the cash on hand, this agreement is expected to provide sufficient cash resources to enable Titan to fund its operations into late second quarter of 2012.

"The positive results from our confirmatory Phase 3 study of Probuphine announced in the third quarter followed by the productive pre-NDA meeting with the U.S. Food and Drug Administration (FDA) in October mark important clinical and regulatory milestones for Titan," said Sunil Bhonsle, President of Titan Pharmaceuticals. "With additional financing secured to fund our near-term development and operations, we can continue to make progress towards completing the scale-up of manufacturing of Probuphine and compiling the information needed for the preparation of the New Drug Application (NDA). Additionally, our clear path forward is important and valuable to potential partners. Once we have received the final FDA meeting minutes, we will confirm the remaining actions required to support our NDA filing and provide an update, as appropriate."

"This has been a productive quarter for Titan and the board is very pleased with the progress made," continued Marc Rubin, M.D., Executive Chairman of Titan Pharmaceuticals. "As a participant in the pre-NDA meeting, I was very encouraged by the guidance the FDA has provided for completing the development of Probuphine and preparation of the NDA. The board is also pleased with the additional investment in Titan from entities affiliated with Deerfield Management. Our focus remains on advancing our ongoing discussions aimed at establishing a strategic partnership for the potential commercialization of Probuphine and, ultimately, bringing a new and novel treatment for opioid dependence to patients."

Third Quarter 2011 Additional Financial Results
Research and Development (R&D) expenses for the third quarter of 2011 were approximately $2.2 million, compared with approximately $3.0 million in the comparable period of 2010. The decrease in R&D expense reflects the reduction of costs associated with the completion of the large confirmatory Phase 3 clinical study of Probuphine. The R&D expense includes approximately $1.3 million of external expenses such as clinical research organization charges, investigator and patient-related clinical site expenses, and other associated costs. The remaining R&D expenses reflect internal operating costs such as personnel-related expenses, meeting and travel expenses and allocation of facility and corporate costs.

General and Administrative (G&A) expenses for the second quarter of 2011 remained constant at approximately $0.7 million compared to approximately $0.7 million in the comparable period of 2010.

Probuphine: Recent Events & Regulatory Path Forward
Probuphine is a novel formulation of buprenorphine that is capable of maintaining a stable, round the clock level of medicine in patients for up to six months following a single treatment. In July and August 2011, Titan announced positive top line results for its Phase 3 confirmatory study for the treatment of opioid dependence, as well as additional positive results demonstrating significant overall patient improvement, a compelling safety profile and non-inferiority to the approved drug Suboxone®.

In October 2011, Titan announced an update from its pre-NDA meeting with the FDA regarding the development of Probuphine for the treatment of opioid dependence. Titan believes that its Phase 3 clinical program completed to date is acceptable to the FDA to support submission of an NDA via the 505(b)(2) pathway and that no additional clinical efficacy or safety studies are required to support the submission. Titan received initial comments from the FDA regarding manufacturing and non-clinical information and is in ongoing discussions with the agency to confirm these requirements. The Company also received clear guidance from the FDA on the requirements for submitting an NDA for consideration to be designated as a Priority Review.

Recent and upcoming events include the following:

  • The Phase 3 open label study for the re-treatment of patients who completed the controlled confirmatory study is progressing as planned and is expected to be completed before year-end 2011.

Recent and upcoming scientific presentations include the following:

  • American Society of Addiction Medicine (ASAM) State of the Art Course in Addiction Medicine, Washington, DC, October 27, 2011 -- "Probuphine and Other Agents to Treat Prescription Drug Abuse" presentation by Walter Ling, M.D., Professor of Psychiatry, Director, Integrated Substance Abuse Programs at the David Geffen School of Medicine at UCLA
  • American Academy of Addiction Psychiatry, Scottsdale, AZ, December 8, 2011 -- "Results of a Six-Month, Randomized, Controlled, Phase 3 Trial Comparing the Efficacy and Safety of Buprenorphine Implants to Placebo Implants, and Sublingual Buprenorphine/Naloxone for Opioid Addiction" to be presented by Dr. Katherine Beebe, Executive Vice President and Chief Development Officer, Titan Pharmaceuticals, Inc.

Conference Call
Titan management will host a live conference call at 1 p.m. ET / 10 a.m. PT on Thursday, November 17, 2011 to provide the Company's financial results as of September 30, 2011 and discuss its Phase 3 Probuphine program. Participating on the call from Titan will be Mr. Bhonsle, Dr. Rubin, Dr. Beebe, Executive Vice President and Chief Development Officer and Mr. Crowley, Vice President of Finance.

The live webcast of the call may be accessed by visiting the Titan website at The call can also be accessed by dialing 1-877-591-4956 Participant code: 8433137 five minutes prior to the start time. A replay of the call will be available on the Company website approximately two hours after completion of the call and will be archived for two weeks.

About Titan Pharmaceuticals
For information concerning Titan Pharmaceuticals, Inc., please visit the Company's website at

The press release may contain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements include, but are not limited to, any statements relating to the Company's development program and any other statements that are not historical facts. Such statements involve risks and uncertainties, including, but not limited to, those risks and uncertainties relating to difficulties or delays in development, testing, regulatory approval, production and marketing of the Company's drug candidates, adverse side effects or inadequate therapeutic efficacy of the Company's drug candidates that could slow or prevent product development or commercialization, the uncertainty of patent protection for the Company's intellectual property or trade secrets, and the Company's ability to obtain additional financing. Such statements are based on management's current expectations, but actual results may differ materially due to various factors, including those risks and uncertainties mentioned or referred to in this press release.

(in thousands, except per share amount)
Three Months Ended Nine Months Ended
September 30, September 30,
2011 2010 2011 2010
Royalty revenue $ 973 $ 396 $ 2,291 $ 2,104
Grant revenue 39 3,203 364 5,251
License revenue - 1 - 12
Total revenue 1,012 3,600 2,655 7,367
Operating expense:
Research and development 2,230 3,044 9,915 6,770
General and administrative 739 691 2,480 2,638
Total operating expense 2,969 3,735 12,395 9,408
Loss from operations (1,957 ) (135 ) (9,740 ) (2,041 )
Other income (expense), net 1,153 (249 ) (2,565 ) (494 )
Net loss $ (804 ) $ (384 ) $ (12,305 ) $ (2,535 )
Basic and diluted net loss per share $ (0.01 ) $ (0.01 ) $ (0.21 ) $ (0.04 )
Weighted average shares used in computing basic and diluted net loss per share 59,386 59,248 59,290 59,248

(in thousands)
September 30, December 31,
2011 2010
Cash $ 2,772 $ 3,180
Receivables 2,797 1,225
Prepaid expenses and other current assets 899 294
Total current assets 6,468 4,699
Property and equipment, net 83 53
$ 6,551 $ 4,752
Liabilities and Stockholders' Deficit
Current liabilities $ 6,383 $ 5,405
Warrant liability 4,713 -
Long-term debt 13,005 5,400
Stockholders' deficit (17,550 ) (6,053 )
$ 6,551 $ 4,752

Contact Information

    Titan Pharmaceuticals, Inc.
    Sunil Bhonsle

    Pure Communications
    Dan Budwick