NeurogesX Inc. (NGSX, Financial) filed Quarterly Report for the period ended 2010-09-30.
Neurogesx Inc. has a market cap of $124.92 million; its shares were traded at around $7.03 with and P/S ratio of 62.27. NGSX is in the portfolios of Jim Simons of Renaissance Technologies LLC.
The application of the above revenue recognition policy resulted in the recognition of $197,000 and $230,000 from total gross shipments of $494,000 and $802,000 for the three and nine months ended September 30, 2010, respectively. Our gross shipments are reduced for chargebacks, certain fees paid to our distributors and product sales allowances including rebates to qualifying federal and state government programs. At September 30, 2010, net deferred product revenues totaled $505,000.
Collaborative Revenue. Collaborative revenue of $1.9 million recorded in the three months ended September 30, 2010 consisted of $1.8 million of the amortization of upfront payments received pursuant to the Astellas Agreement as well as $0.1 million of Collaborative revenue under our Supply Agreement with Astellas. Collaborative revenue of approximately $119,000 was recorded in the three months ended September 30, 2009 and resulted from the commencement of amortization of upfront milestone payments received under the Astellas Agreement in late September 2009.
Research and Development expenses. Research and development expenses decreased by $0.2 million or 7%, to $3.2 million for the three months ended September 30, 2010 from $3.4 million or for the same period in 2009. The decrease was attributable to a $1.2 million decrease resulting from royalties paid to the UC in 2009, partially offset by a $0.8 million increase in the current period associated with the preparation of our Phase 2 study of NGX-1998. During both periods, we were engaged primarily in activities supported by our internal personnel including the management of regulatory processes to gain approval in both Europe and the United States during 2009 and in 2010, the maintenance of the New Drug Application or NDA in the United States for Qutenza. Further, whereas in 2009, we were engaged in conducting a small clinical study at the request of the FDA in support of our NDA. In 2010, we were engaged in the planning and preparatory work associated with the initiation of a Phase 2 study for our lead product candidate, NGX-1998. Over the remainder of this year and into 2011, we expect that our research and development costs may increase due to the continued development of NGX-1998, including our Phase 2 study which began in October, nonclinical activities, and formulation development work .In addition, costs may increase for our planned submission of an sNDA for Qutenzas HIV-AN indication.
Selling, General and Administrative expenses. Selling, general and administrative expenses increased $6.2 million, or 183%, to $9.6 million for the three months ended September 30, 2010, from $3.4 million for the same period in 2009. This increase was due in large part to the continuing commercialization efforts of Qutenza in the United States which began in April 2010. Specifically, the increases included $2.1 million in costs associated with our sales and commercial operation organization including salary and related expenses; $2.7 million increase in expenses for marketing materials development and other launch related marketing costs; $0.5 million in cost increase due to the expansion of our medical affairs department; and $0.5 million in costs due to an increase in general and administrative salary and related expenses, temporary help and consultants, professional service fees and other public company costs. These increases were offset by a $0.1 million decrease in stock-based compensation costs due to the granting of options to employees and officers in 2009 that immediately vested and a decrease in legal fees of $0.1 million primarily due to fees incurred in the 2009 period associated with the Astellas Agreement. We anticipate that Selling, general and
Interest expense. Interest expense was $2.0 million for the three months ended September 30, 2010 as compared to $28,000 for the same period in 2009. This increase was primarily due to interest on the $40 million Long term obligation related to the Financing Agreement entered into with Cowen Royalty, in April 2010.
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Neurogesx Inc. has a market cap of $124.92 million; its shares were traded at around $7.03 with and P/S ratio of 62.27. NGSX is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
To date, we have funded our operations primarily by selling equity securities, establishing debt facilities and through a collaboration agreement with Astellas. We have incurred significant losses since our inception. We had cash, cash equivalents and short-term investments totaling $57.7 million at September 30, 2010 and during the nine months ended September 30, 2010 we used $31.4 million in operating activities. We expect to continue to incur annual operating losses over the next several years and our operating expenses are expected to increase in the coming years as we continue our sales and marketing efforts of Qutenza in the United States, seek label expansion for Qutenza in the United States and resume our development activities associated with NGX-1998 and potentially other product candidates. As a result of increased operating expenses, our operating losses may increase over the next few years, dependent in part on the amount of Qutenza sales revenues during these periods. On April 30, 2010, we entered into a $40 million Financing Agreement with Cowen Healthcare Royalty Partners, L.P., or Cowen Royalty. The agreement creates a debt obligation that will be repaid through and secured by royalties and future milestone payments payable to us by Astellas that we refer to as Revenue Interests. We believe that this structure provides us with capital to continue executing our operating plan. We anticipate that our existing cash and investments will be sufficient to meet our projected operating requirements through at least the next twelve months.The application of the above revenue recognition policy resulted in the recognition of $197,000 and $230,000 from total gross shipments of $494,000 and $802,000 for the three and nine months ended September 30, 2010, respectively. Our gross shipments are reduced for chargebacks, certain fees paid to our distributors and product sales allowances including rebates to qualifying federal and state government programs. At September 30, 2010, net deferred product revenues totaled $505,000.
Collaborative Revenue. Collaborative revenue of $1.9 million recorded in the three months ended September 30, 2010 consisted of $1.8 million of the amortization of upfront payments received pursuant to the Astellas Agreement as well as $0.1 million of Collaborative revenue under our Supply Agreement with Astellas. Collaborative revenue of approximately $119,000 was recorded in the three months ended September 30, 2009 and resulted from the commencement of amortization of upfront milestone payments received under the Astellas Agreement in late September 2009.
Research and Development expenses. Research and development expenses decreased by $0.2 million or 7%, to $3.2 million for the three months ended September 30, 2010 from $3.4 million or for the same period in 2009. The decrease was attributable to a $1.2 million decrease resulting from royalties paid to the UC in 2009, partially offset by a $0.8 million increase in the current period associated with the preparation of our Phase 2 study of NGX-1998. During both periods, we were engaged primarily in activities supported by our internal personnel including the management of regulatory processes to gain approval in both Europe and the United States during 2009 and in 2010, the maintenance of the New Drug Application or NDA in the United States for Qutenza. Further, whereas in 2009, we were engaged in conducting a small clinical study at the request of the FDA in support of our NDA. In 2010, we were engaged in the planning and preparatory work associated with the initiation of a Phase 2 study for our lead product candidate, NGX-1998. Over the remainder of this year and into 2011, we expect that our research and development costs may increase due to the continued development of NGX-1998, including our Phase 2 study which began in October, nonclinical activities, and formulation development work .In addition, costs may increase for our planned submission of an sNDA for Qutenzas HIV-AN indication.
Selling, General and Administrative expenses. Selling, general and administrative expenses increased $6.2 million, or 183%, to $9.6 million for the three months ended September 30, 2010, from $3.4 million for the same period in 2009. This increase was due in large part to the continuing commercialization efforts of Qutenza in the United States which began in April 2010. Specifically, the increases included $2.1 million in costs associated with our sales and commercial operation organization including salary and related expenses; $2.7 million increase in expenses for marketing materials development and other launch related marketing costs; $0.5 million in cost increase due to the expansion of our medical affairs department; and $0.5 million in costs due to an increase in general and administrative salary and related expenses, temporary help and consultants, professional service fees and other public company costs. These increases were offset by a $0.1 million decrease in stock-based compensation costs due to the granting of options to employees and officers in 2009 that immediately vested and a decrease in legal fees of $0.1 million primarily due to fees incurred in the 2009 period associated with the Astellas Agreement. We anticipate that Selling, general and
Interest expense. Interest expense was $2.0 million for the three months ended September 30, 2010 as compared to $28,000 for the same period in 2009. This increase was primarily due to interest on the $40 million Long term obligation related to the Financing Agreement entered into with Cowen Royalty, in April 2010.
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