Arrowhead Research Corp. (ARWR, Financial) filed Annual Report for the period ended 2011-09-30.
Arrowhead Research Corp. has a market cap of $29.7 million; its shares were traded at around $4.14 with and P/S ratio of 48.
Revenue associated with research and development funding payments under collaborative agreements is recognized ratably over the relevant periods specified in the agreement, generally the research and development period. Revenue from up-front license fees, milestones and product royalties are recognized as earned based on the completion of the milestones and product sales, as defined in the respective agreements. Payments received in advance of recognition as revenue are recorded as deferred revenue.
The change in the net loss was the result of a number of factors. Arrowhead divested Unidym in January 2011, accordingly, losses incurred at Unidym decreased from fiscal 2010 to fiscal 2011. During fiscal 2010, losses from Unidym were $3 million, compared to income in fiscal 2011 of $1.4 million, resulting in a change of $4.4 million. The income from discontinued operations in fiscal 2011 was driven by revenue of $4.7 million primarily from a license agreement with Samsung prior to the disposal of Unidym. Additionally, during fiscal 2011, Arrowhead recognized a gain from the disposal of Unidym of $3.9 million. These variances were somewhat offset by the inclusion of Ablaris, which was acquired in December 2010, including a one-time license fee of $2 million and other Ablaris operating expenses of approximately $0.6 million. Other variances included higher general and administrative expenses of $1.4 million, primarily due to costs related to the acquisition of Roche Madison which was completed in October 2011. Other income/expense was unfavorable by $0.5 million primarily due to the change in the value of derivative liabilities as compared to the prior year.
Based upon the Companys cash on hand and operating plan at September 30, 2011, additional sources of financing since September 30, 2011 and other sources of liquidity, as described above, the Companys management anticipates that the Company will be able to satisfy the cash requirements of its operations through at least the next twelve months. However, the Company anticipates that further equity financings, and/or asset sales and license agreements will be necessary to continue to fund operations in the future.
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Arrowhead Research Corp. has a market cap of $29.7 million; its shares were traded at around $4.14 with and P/S ratio of 48.
Highlight of Business Operations:
Through our Subsidiaries, we are party into exclusive, long-term license agreements with California Institute of Technology, Alnylam Pharmaceuticals, Inc. and other entities to incorporate their proprietary technologies into our proposed products. These license agreements require us to pay royalties and satisfy other conditions, including conditions in some cases related to the commercialization of the licensed technology. We may not be able to successfully incorporate these technologies into marketable products or, if we do, whether sales will be sufficient to recover the amounts that we are obligated to pay to the licensors. Failure by us to satisfy our obligations under these agreements may result in the modification of the terms of the licenses, such as by rendering them non-exclusive, or may give our licensors the right to terminate their respective agreement with us, which would limit our ability to implement our current business plan and harm our business and financial condition.Revenue associated with research and development funding payments under collaborative agreements is recognized ratably over the relevant periods specified in the agreement, generally the research and development period. Revenue from up-front license fees, milestones and product royalties are recognized as earned based on the completion of the milestones and product sales, as defined in the respective agreements. Payments received in advance of recognition as revenue are recorded as deferred revenue.
The change in the net loss was the result of a number of factors. Arrowhead divested Unidym in January 2011, accordingly, losses incurred at Unidym decreased from fiscal 2010 to fiscal 2011. During fiscal 2010, losses from Unidym were $3 million, compared to income in fiscal 2011 of $1.4 million, resulting in a change of $4.4 million. The income from discontinued operations in fiscal 2011 was driven by revenue of $4.7 million primarily from a license agreement with Samsung prior to the disposal of Unidym. Additionally, during fiscal 2011, Arrowhead recognized a gain from the disposal of Unidym of $3.9 million. These variances were somewhat offset by the inclusion of Ablaris, which was acquired in December 2010, including a one-time license fee of $2 million and other Ablaris operating expenses of approximately $0.6 million. Other variances included higher general and administrative expenses of $1.4 million, primarily due to costs related to the acquisition of Roche Madison which was completed in October 2011. Other income/expense was unfavorable by $0.5 million primarily due to the change in the value of derivative liabilities as compared to the prior year.
Based upon the Companys cash on hand and operating plan at September 30, 2011, additional sources of financing since September 30, 2011 and other sources of liquidity, as described above, the Companys management anticipates that the Company will be able to satisfy the cash requirements of its operations through at least the next twelve months. However, the Company anticipates that further equity financings, and/or asset sales and license agreements will be necessary to continue to fund operations in the future.
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