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METHYLGENE ANNOUNCES THIRD QUARTER 2006 RESULTS
Montreal, Quebec. November 1, 2006 – MethylGene Inc. (TSX:MYG) today announced operational and financial results for the third quarter ended September 30, 2006.
Highlights
• Initiated two Phase II clinical trials with MGCD0103 in Hodgkin's lymphoma (Trial 010) and in B-cell lymphomas (Trial 008). In October, we announced the initiation of a Phase I/II trial in combination with Gemzar® (gemcitabine HCl, Eli Lilly and Company) in pancreatic cancer (Trial 006).
• Continued dose-escalation and enrollment for the MGCD0103 Phase I/II clinical trial in combination with Vidaza® (azacitidine for injectable suspension, marketed by Pharmion) in patients with acute myeloid leukemia and myelodysplastic syndrome (Trial 005).
• Received milestone payment for the initiation of MGCD0103 Phase II trials from Pharmion Corporation of U.S. $4.0 million. The Phase II milestone payment from Taiho of U.S. $1.5 million was received in October.
• Reported preclinical in vitro results on our antifungal histone deacetylase (HDAC) inhibitor MG3290 to overcome fungal HDAC-mediated azole resistance at the 46th Annual ICAAC conference and at the 3rd Annual North American Genetic ABC Workshop.
Financial Results
Total revenues for the third quarter ended September 30th were $8.6 million compared with $1.7 million for the third quarter of 2005. The revenues in the third quarter of 2006 consist primarily of milestone payments, research collaborations, contract revenues and license and upfront fees stemming from our partnerships with Pharmion Corporation and Taiho Pharmaceutical. Total net expenditures from current operations, which exclude the recovery of non-refundable tax credits, were $5.4 million down from $5.6 million in the third quarter of 2005 as significantly higher interest income and a foreign exchange gain helped reduce overall net expense in the third quarter of 2006. Gross research and development and general administration costs were $5.4 million and $1.2 million in the third quarter of 2006 compared to $4.7 million and $1.1 million in the third quarter of 2005, respectively. At September 30th, MethylGene had $67.3 million in cash, cash equivalents, and short term investments. The Company believes that its cash position, with projected revenues from current collaborations and interest income; the projected timing of its clinical trials; and the refundable investment tax credits will be sufficient to carry out its currently planned research and development plans and operations into the fourth quarter of 2008.
Milestones Anticipated for the Balance of 2006
• Continue enrolment in the following MGCD0103 clinical trials: Trial 004, a Phase I trial in leukemia; Trial 005, a Phase I/II combination trial with Vidaza® in AML and MDS; Trial 006, a Phase I/II trial in combination with Gemzar® in pancreatic cancer; Trial 008, a Phase II trial in B-cell lymphomas; and Trial 010, a Phase II trial in Hodgkin’s lymphoma.
• Commence two additional MGCD0103 Phase II monotherapy clinical trials by the end of the year.
• Select a c-met multi-targeted kinase clinical candidate for cancer.
• Continue the optimization and evaluation of lead compounds to identify a second generation oncology HDAC inhibitor clinical candidate for cancer.
• Continue research in non-oncology HDAC indications for Huntington’s disease and for antifungals to overcome azole resistance.
• Update preclinical and clinical data during poster presentations at the 18th EORTC-NCI-AACR symposium (Prague, November 7-10, 2006) and at the 48th ASH annual meeting (Orlando, December 9-12, 2006).
About MethylGene
MethylGene is a publicly-traded biopharmaceutical company focused on the discovery, development and commercialization of novel therapeutics in cancer. Two cancer product candidates are currently in clinical development: MGCD0103, partnered with Pharmion Corporation and Taiho Pharmaceutical Co., Ltd., and MG98, partnered with MGI Pharma, Inc. MethylGene has an exclusive license agreement with Merck & Co. for the development and commercialization of small molecule beta-lactamase inhibitors to overcome antibiotic resistance. MethylGene has partnered its non-oncology HDAC program for neurodegenerative diseases with EnVivo Pharmaceuticals. MethylGene has a portfolio of preclinical programs for its multi-targeted kinase (c-met) and histone deacetylase (HDAC) inhibitors for both oncology and non-oncology indications, and continues to seek partnering opportunities in these areas. Please visit our website at www.methylgene.com.
Certain statements contained in this news release, other than statements of fact that are independently verifiable at the date hereof, may constitute forward-looking statements. Such statements, based as they are on the current expectations of management of MethylGene, inherently involve numerous risks and uncertainties, known and unknown, many of which are beyond MethylGene's control. These risks and uncertainties could cause future results, performance or achievements to differ significantly from the results, performance or achievements expressed or implied by such forward-looking statements. Such results, performance or achievements include, but are not limited to, the timing and effects of regulatory action; the continuation of collaborations; the results of clinical trials; the timing of enrollment or completion of clinical trials; the success, efficacy or safety of MGCD0103 or MG98; and the relative success or the lack of success in developing and gaining regulatory approval and/or market acceptance for any compound or new product including MGCD0103 and MG98. Such risks include, but are not limited to, the impact of general economic conditions, economic conditions in the pharmaceutical industry, changes in the regulatory environment in the jurisdictions in which MethylGene does business, stock market volatility, fluctuations in costs, expectations with respect to our intellectual property position and our ability to protect our intellectual property and operate our business without infringing upon the intellectual property rights of others, changes in the competitive landscape including changes in the standard of care for the various indications in which MethylGene is involved, and changes to the competitive environment due to consolidation, as well as other risks, which you are urged to read, as described in MethylGene's Annual Information Form for the fiscal year ending December 31 2005, under the heading "risk factors,” that can be found at www.SEDAR.com. Consequently, actual future results may differ materially from the anticipated results expressed in the forward-looking statements. The reader should not place undue reliance on the forward-looking statements included in this presentation. These statements speak only as an update on the date they are made and MethylGene is under no obligation to revise such statements as a result of any event, circumstance or otherwise except in accordance with law.
Investor Relations Contacts:
Rhonda Chiger
Rx Communications Group, LLC
Phone: 917-322-2569
rchiger@rxir.com
Donald F. Corcoran
President & CEO
MethylGene Inc.
Phone: 514-337-3333 ext. 373
mctavishk@methylgene.com
For summary financial statements, please visit www.methylgene.com.
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