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Repros Therapeutics Inc. Reports Operating Results (10-Q)

May 10, 2010 | About:
10qk

10qk

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Repros Therapeutics Inc. (RPRX) filed Quarterly Report for the period ended 2010-03-31.

Repros Therapeutics Inc. has a market cap of $19.38 million; its shares were traded at around $0.74 with and P/S ratio of 35.18. RPRX is in the portfolios of Jim Simons of Renaissance Technologies LLC.

Highlight of Business Operations:

Repros Therapeutics Inc. ("the Company", "RPRX," “Repros”, or "we," "us" or "our") was organized on August 20, 1987. We are a development stage biopharmaceutical company focused on the development of oral small molecule drugs for major unmet medical needs. As of March 31, 2010, we had accumulated losses of $175.6 million, approximately $974,000 in cash and cash equivalents, and our accounts payable and accrued expenses were approximately $1.9 million. As of April 30, 2010, we had cash and cash equivalents of approximately $4.0 million. The amount of cash on hand is not sufficient to fund our future clinical trials of Androxal® and, if the current FDA clinical hold on Proellex® is removed, Proellex®, and pay our accounts payable and accrued expenses as well as our normal corporate overhead and expenses. The foregoing and other matters raise substantial doubt about our ability to continue as a going concern. We continue to explore potential additional financing alternatives that would provide sufficient funds to enable us to continue to develop our two product candidates through completion of clinical trials; however, there can be no assurance that we will be successful in raising any such additional funds on a timely basis or at all. Significant additional capital will be required for us to complete development of either of our product candidates.

In addition, we have not received regulatory approval for any of our product candidates, have not successfully earned any significant commercial revenues from any of our product candidates and may never launch either of our product candidates. If we do not successfully commercialize any of our product candidates, we will be unable to achieve our business objectives. In addition, the reported results of our clinical trials completed to date may not be indicative of results that will be achieved in later-stage clinical trials involving larger and more diverse patient populations. As of March 31, 2010, we had accumulated losses of $175.6 million, approximately $974,000 in cash and cash equivalents, and our accounts payable and accrued expenses were approximately $1.9 million. The amount of cash on hand is not sufficient to fund our future clinical trials of Androxal® and, if the current FDA clinical hold on Proellex® is removed, Proellex®, and pay our accounts payable and accrued expenses as well as our normal corporate overhead and expenses. The foregoing and other matters raise substantial doubt about our ability to continue as a going concern and we expect to continue to incur significant losses over the next several years, and we may never become profitable. Our financial statements do not include any adjustments that might result from the outcome of these uncertainties.

We capitalize the cost associated with building our patent library for Androxal®. As of March 31, 2010, other assets consist of capitalized patent and patent application costs in the amount of $925,000. Patent costs, which include legal and application costs related to the patent portfolio, are being amortized over 20 years, or the lesser of the legal or the estimated economic life of the patent. Amortization of patent costs was $14,000 and $12,000 for the three month period ended March 31, 2010 and 2009, respectively. The entire $925,000 in capitalized patents and patent applications relates to Androxal®.

Research and development, or R&D, expenses include contracted services relating to our clinical product development activities which include preclinical studies, clinical trials, regulatory affairs and bulk manufacturing scale-up activities and bulk active ingredient purchases for preclinical and clinical trials primarily relating to our two products in clinical development, which are Androxal® and Proellex®. Research and development expenses also include internal operating expenses relating to our general research and development activities. R&D expenses decreased 92% or approximately $5.2 million to $458,000 for the three month period ended March 31, 2010 as compared to $5.7 million for the same period in the prior year. Our primary R&D expenses for the three month periods ended March 31, 2010 and 2009 are shown in the following table (in thousands):

To date through March 31, 2010 we have incurred approximately $14.4 million for the development of Androxal® and approximately $55.3 million for the development of Proellex®. These accumulated costs exclude any internal operating expenses. We are currently developing Androxal® as a treatment for men with low testosterone that want to maintain their fertility. In addition, we have received confirmation from the DMEP that our new IND was accepted for the investigation of Androxal® as a potential treatment for type 2 diabetes. As a result, we may initiate a Phase 2 trial, subject to available funding. Before the clinical hold on further Proellex® development in August 2009, we were developing Proellex® for three indications which included a pre-surgical treatment of anemia associated with uterine fibroids, a chronic treatment of symptoms associated with uterine fibroids and as a chronic treatment of symptoms associated with endometriosis.

General and administrative expenses, or G&A, decreased 37% to approximately $669,000 for the three month period ended March 31, 2010 as compared to $1.1 million for the same period in the prior year. Our primary G&A expenses for the three month period ended March 31, 2010 and 2009 are shown in the following table (in thousands):

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