Affymax® Reports First Quarter 2010 Financial Results

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PALO ALTO, Calif.--(BUSINESS WIRE)-- Affymax, Inc. (Nasdaq: AFFY) today reported financial results for the first quarter ended March 31, 2010. The net loss for the first quarter of 2010 was $7.9 million compared to a net loss of $21.7 million for the first quarter of 2009.

Affymax recognized revenue for the quarter ended March 31, 2010 of $34.7 million compared to $25.9 million for the quarter ended March 31, 2009. The increase in revenue was the result of increased collaboration revenue from its partnership with Takeda Pharmaceutical Company Limited, under their 2006 collaboration for development of Affymax’s compound, Hematide™.

Research and development expenses for the quarter ended March 31, 2010, were $33.1 million compared to $40.4 million for the quarter ended March 31, 2009. The decrease was primarily due to the completion of the treatment and follow up of our Phase 3 clinical trials at the start of 2010.

General and administrative expenses for the quarter ended March 31, 2010 were $9.4 million compared to $7.4 million for the quarter ended March 31, 2009. The increase was primarily due to higher external commercial expenses.

The company’s cash, investments and receivables from Takeda totaled $167.6 million as of March 31, 2010, including a $5.0 million cash milestone payment received in March 2010 from Takeda for the initiation of Phase 3 clinical trials in Japan.

About Affymax, Inc.

Affymax, Inc. is a biopharmaceutical company committed to developing novel drugs to improve the treatment of serious and often life-threatening conditions. Affymax’s product candidate, Hematide™/peginesatide, recently completed Phase 3 clinical trials for the treatment of anemia associated with chronic renal failure. For additional information, please visit www.affymax.com.

This release contains forward-looking statements, including statements regarding financial condition, the continuation and success of the Company’s collaboration with Takeda, timing, design and results of the Company’s clinical trials and drug development program and the timing and likelihood of the commercialization of Hematide. The Company’s actual results may differ materially from those indicated in these forward-looking statements due to risks and uncertainties, including risks relating to the continued safety and efficacy of Hematide in clinical development, the timing of patient accrual in ongoing and planned clinical studies, regulatory requirements and approvals, research and development efforts, industry and competitive environment, intellectual property rights and disputes and other matters that are described in Affymax’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission. Investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. The Company undertakes no obligation to update any forward-looking statement in this press release.

AFFYMAX, INC. UNAUDITED CONDENSED BALANCE SHEETS (in thousands)

	March 31,			December 31,
		2010		2009
Assets
Current assets
Cash and cash equivalents	$	68,188			$	125,296
Short-term investments		68,949				35,292
Receivable from Takeda		13,555				18,561
Income taxes receivable		125				1,443
Deferred tax assets		1,443				1,443
Prepaid expenses and other current assets		8,420				8,704
Total current assets		160,680				190,739
Property and equipment, net		5,127				5,469
Restricted cash		1,135				1,135
Long-term investments		16,939				7,978
Deferred tax assets, net of current		5,797				5,797
Other assets		307				392
Total assets	$	189,985			$	211,510
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	3,159			$	464
Accrued liabilities		10,270				12,594
Accrued clinical trial expenses		36,832				39,499
Deferred revenue		57,603				71,972
UBS loan		9,041				9,192
Total current liabilities		116,905				133,721
Long-term income tax liability		9,425				9,425
Other long-term liabilities		1,453				1,459
Total liabilities		127,783				144,605

Stockholders’ equity
Common stock		24				24
Additional paid-in capital		444,940				441,795
Accumulated deficit		(382,725	)			(374,859	)
Accumulated other comprehensive loss		(37	)			(55	)
Total stockholders’ equity		62,202				66,905
Total liabilities and stockholders’ equity	$	189,985			$	211,510

AFFYMAX, INC. UNAUDITED CONDENSED STATEMENTS OF OPERATIONS (in thousands, except per share data)

	Three Months Ended March 31,
		2010			2009
Collaboration revenue	$	34,646		$	25,849
License and royalty revenue		4			4
Total revenue		34,650			25,853
Operating expenses
Research and development		33,093			40,447
General and administrative		9,419			7,417
Total operating expenses		42,512			47,864
Loss from operations		(7,862	)		(22,011	)
Interest income		97			401
Interest expense		(34	)		—
Other income (expense), net		(67	)		(161	)
Net loss before benefit for income taxes		(7,866	)		(21,771	)
Benefit for income taxes		—			(31	)
Net loss	$	(7,866	)	$	(21,740	)
Net loss per share:
Basic and diluted	$	(0.33	)	$	(1.32	)
Weighted-average number of shares used in computing basic and diluted net loss per share		23,932			16,488