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Palatin Technologies Inc Reports Operating Results (10-Q)

February 17, 2009 | About:
10qk

Palatin Technologies Inc (PTN) filed Quarterly Report for the period ended 2008-12-31.

Palatin Technologies Inc is a development-stage medical technology companyinvolved in developing and commercializing products and technologies fordiagnostic imaging cancer therapy and ethical drug development These developments are based on its proprietary monoclonal antibody radiolabeling and enabling peptide platform technologies. Palatin Technologies Inc has a market cap of $8.22 million; its shares were traded at around $0.1 with and P/S ratio of 0.72.

Highlight of Business Operations:

Licenses and Contracts For the three and six months ended December 31, 2008, we recognized $1.2 million and $2.0 million, respectively, in licenses and contract revenue related to our license agreement with AstraZeneca. For the three and six months ended December 31, 2007, we recognized $0.7 million and $9.7 million, respectively, in licenses and contract revenue consisting of (i) $0 and $8.2 million, respectively, related to bremelanotide pursuant to our collaboration agreement with King, (ii) $0.7 million and $1.4 million, respectively, related to our license agreement with AstraZeneca, and (iii) $0 and $0.1 million related to NeutroSpec pursuant to our collaboration agreement with Mallinckrodt.

Research and Development Research and development expenses decreased to $2.8 million for the three months ended December 31, 2008 from $3.8 million for the three months ended December 31, 2007. Research and development expenses decreased to $6.5 million for the six months ended December 31, 2008 from $11.7 million for the six months ended December 31, 2007.

Research and development expenses related to our PL-3994, PL-6983, obesity and other preclinical programs were $0.6 million and $1.7 million, respectively, for the three and six months ended December 31, 2008 compared to $0.7 million and $1.7 million, respectively, for the three and six months ended December 31, 2007. Spending to date has been related to the identification and optimization of lead compounds, preclinical studies and a Phase 1 and Phase 2a trial with PL-3994. The amount of such spending and the nature of future development activities are dependant on a number of factors, including primarily the availability of funds to support future development activities, success of our clinical trials, preclinical and discovery programs, and our ability to progress compounds in addition to PL-3994 into human clinical trials.

The historical amounts of project spending above exclude general research and development spending, which decreased to $2.2 million and $4.8 million, respectively, for the three and six months ended December 31, 2008 compared to $2.9 million and $7.4 million, respectively, for the three and six months ended December 31, 2007. The decrease is primarily related to the reductions in workforce initiated in September 2007 and May 2008.

General and Administrative General and administrative expenses decreased to $1.1 million and $2.6 million, respectively, for the three and six months ended December 31, 2008 compared to $2.3 million and $4.0 million, respectively, for the three and six months ended December 31, 2007. The decrease is primarily related to the reductions in workforce initiated in September 2007 and May 2008.

We have incurred cumulative negative cash flows from operations since our inception, and have expended, and expect to continue to expend in the future, substantial funds to complete our planned product development efforts. As of December 31, 2008, our cash and cash equivalents were $3.0 million, available-for-sale investments were $3.4 million and accounts receivable were $4.9 million. This $11.3 million, coupled with $2.5 million in milestone payments earned in January 2009 pursuant to Palatins agreements with AstraZeneca and expected receipts from collaboration and license agreements and other income, will be adequate to fund our projected operations through calendar year 2009.

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