Affymax® Reports Year End 2010 Financial Results

PALO ALTO, Calif.--(BUSINESS WIRE)-- Affymax, Inc. (Nasdaq: AFFY) today reported financial results for the year ended December 31, 2010. The net loss for the year ended December 31, 2010 was $14.1 million compared to a net loss of $76.5 million for the year ended December 31, 2009.

Affymax recognized revenue for the year ended December 31, 2010 of $112.5 million compared to $114.9 million for the year ended December 31, 2009. The decrease in revenue was the result of lower collaboration revenue from its partnership with Takeda Pharmaceutical Company Limited (Takeda), under their 2006 collaboration for development of peginesatide (previously known as Hematide™), due largely to the completion of the Phase 3 clinical trials in chronic renal failure in early 2010.

Research and development expenses for the year ended December 31, 2010 were $93.6 million compared to $157.1 million for the year ended December 31, 2009. The decrease was primarily due to a reduction in expenses associated with the Phase 3 clinical development completed in early 2010.

General and administrative expenses for the year ended December 31, 2010 were $33.3 million compared to $36.7 million for the year ended December 31, 2009 primarily due to lower legal fees in 2010.

The company had cash and investments of $118.1 million at December 31, 2010.

“Looking at planned activities in 2011, our highest priority is to submit the New Drug Application for peginesatide to the FDA in the second quarter,” said John Orwin, chief executive officer at Affymax. “In addition, we will continue laying the groundwork for potential approval and launch of the product, including preparing for pre-approval inspections, getting ready for a potential FDA advisory committee review, and initiating a Phase 3b program designed to evaluate the process and outcomes of converting dialysis centers from a three times a week ESA to a once monthly ESA.”

Financial Guidance

With respect to income, Affymax expects continued reimbursement from Takeda of 70 percent of third party expenses associated with research and development and 50 percent of third party expenses associated with commercial activities. Beginning mid-2011 we will also receive 50 percent reimbursement of internal expenses associated with commercial activities. Including a $10 million milestone payment the company expects to receive from Takeda in connection with the acceptance of its NDA submission by the FDA, Affymax expects to receive total payments from Takeda of $20 million to $25 million in 2011.

With respect to total operating expenses Affymax expects to incur $105 million to $110 million in operating expenses during 2011, excluding stock-based compensation. This represents a reduction from 2010 as a result of a significant reduction in Phase 3 clinical trial costs, the majority of which is offset by expenses associated with NDA preparation activities, and expansion of our commercial capabilities.

We expect cash resources, on-going Takeda reimbursement and milestone payments from Takeda to fund our operations well into 2012. Under the terms of our 2006 collaboration with Takeda, we are eligible to receive a $50 million milestone upon approval of the NDA by the FDA.

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, has been evaluated in 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 projections and condition, milestones expected to be accomplished, continuation and success of the Company’s collaboration with Takeda, timing, design and progress of the Company’s peginesatide development program and the timing and potential regulatory approval and commercialization of peginesatide. 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 our ability to submit a New Drug Application (NDA) in the second quarter, the completeness of the NDA filing,, risks relating to data quality and integrity particularly in non-inferiority designed trials, risks related to the continued safety and efficacy of peginesatide in clinical development, the potential for once per month dosing and room temperature stability, 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 potential for costs, disruptions and consequences of litigation, financing requirements and ability to access capital, and other matters that are described in Affymax’s Annual Report on Form 10-K 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.

BALANCE SHEETS

(in thousands)

 
  December 31,
  2010  

 

 

2009

 
Assets
Current assets
Cash and cash equivalents $ 63,499 $ 125,296
Restricted cash 11 11
Short-term investments 33,582 35,292
Receivable from Takeda 18,561
Income taxes receivable 1,443
Deferred tax assets 438 1,443

Prepaid expenses and other current assets

  2,012     8,693  
Total current assets 99,542 190,739
Property and equipment, net 3,982 5,469
Restricted cash 1,135 1,135
Long-term investments 19,876 7,978
Deferred tax assets, net of current 6,802 5,797
Other assets   50     392  
Total assets $ 131,387   $ 211,510  
 
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable $ 321 $ 464
Accrued liabilities 11,594 12,594
Accrued clinical trial expenses 11,247 39,499
Payable to Takeda 5,958
Deferred revenue 18,497 71,972
UBS loan       9,192  
Total current liabilities 47,617 133,721
Long-term income tax liability 10,249 10,109
Other long-term liabilities   974     775  
Total liabilities   58,840     144,605  
 
Stockholders’ equity
Common stock 25 24
Additional paid-in capital 461,425 441,795
Accumulated deficit (388,934 ) (374,859 )
Accumulated other comprehensive income (loss)   31     (55 )
Total stockholders’ equity   72,547     66,905  
Total liabilities and stockholders’ equity $ 131,387   $ 211,510  
 

AFFYMAX, INC.

STATEMENTS OF OPERATIONS

(in thousands, except per share data)

 
  Year Ended December 31,
  2010       2009       2008  
Revenue:
Collaboration revenue $ 112,503 $ 114,883 $ 82,162
License and royalty revenue   18     16     689  
Total revenue   112,521     114,899     82,851  
Operating expenses:
Research and development 93,638 157,125 137,492
General and administrative   33,331     36,716     34,090  
Total operating expenses   126,969     193,841     171,582  
Loss from operations (14,448 ) (78,942 ) (88,731 )
Interest income 275 934 4,545
Interest expense (140 ) (105 ) (609 )
Other income (expense), net   239     171     (1,433 )
Net loss before provision (benefit) for income taxes (14,074 ) (77,942 ) (86,228 )
Provision (benefit) for income taxes   1     (1,411 )   282  
Net loss $ (14,075 ) $ (76,531 ) $ (86,510 )
Net loss per common share:
Basic and diluted $ (0.57 ) $ (4.06 ) $ (5.68 )
Weighted-average number of common shares used in computing basic and diluted net loss per common share   24,488     18,865     15,220  



CONTACT:

Affymax, Inc.
Sylvia Wheeler, 650-812-8861
Vice President, Corporate Communications

KEYWORDS:   United States  Asia Pacific  North America  California  Japan

INDUSTRY KEYWORDS:   Health  Biotechnology  Clinical Trials  Pharmaceutical  Research  FDA  Science

MEDIA:

Logo
 Logo