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BELLUS HEALTH REPORTS RESULTS FOR THIRD QUARTER ENDED SEPTEMBER 30, 2010 AND ANNOUNCES RECEIPT OF US$5 MILLION FROM PARTNER CEL

^{Published on 2010-11-10 05:11:35 - Market Wire}
 

LAVAL, QC, Nov. 10 /CNW Telbec/ - BELLUS Health Inc. (TSX: BLU) ("BELLUS Health" or the "Company") reported today its financial results for the third quarter ended September 30, 2010. All currency figures reported in this press release, including comparative figures, are in Canadian dollars, unless otherwise specified.

"We are pleased with the progress made in the past months in implementing our strategic initiatives to limit our operating costs while continuing to add value to the products in our pipeline and are looking forward to important developments in the fourth quarter of 2010," said Roberto Bellini, President and Chief Executive Officer of BELLUS Health. "We have received the second installment of US$5 million in connection with the KIACTA™ Asset Purchase and License Agreement from our strategic partner Celtic Therapeutics, which is also on track to initiate a confirmatory phase III clinical study for KIACTA™, a drug candidate developed by BELLUS Health for the treatment of AA amyloidosis, during the fourth quarter of 2010. This study represents an important milestone for BELLUS Health and its shareholders. We also expect to complete the on-going phase I clinical study for NRM8499 in the treatment of Alzheimer's disease during the quarter and anticipate the results of this study to be available in the first quarter of 2011."  

Financial Results

For the three-month period ended September 30, 2010, the net loss amounted to $6,287,000 ($0.03 per share), compared to $6,410,000 ($0.04 per share) for the corresponding period the previous year. For the nine-month period ended September 30, 2010, the net loss amounted to $16,296,000 ($0.08 per share), compared to $4,485,000 ($0.18 per share) for the same period last year. 

The decrease in net loss for the quarter ended September 30, 2010 compared to the corresponding quarter the previous year, is primarily due to the revenue from the KIACTA™ Asset Purchase and License Agreement and a decrease in marketing and selling expenses as well as stock-based compensation, offset by an increase in general and administrative expenses in connection with the workforce reduction announced in August 2010 and an increase in depreciation and equipment write-off. The significant variation between the net loss for the nine-month periods ended September 30, 2010 and 2009, is attributable to unusual items recorded in the second quarter of 2009 in relation to the Company's refinancing that took place in April 2009. During that quarter, the Company recorded a gain on extinguishment of debt in the amount of $19,173,000 resulting from amendments to the terms of the convertible notes issued in 2006 and 2007, as well as a net credit for vacant space in the amount of $2,474,000 in relation to the vacant portion of the Company's premises.

As at September 30, 2010, the Company had available cash and cash equivalents of $7,949,000, compared to $14,017,000 at December 31, 2009. The decrease in the nine-month period is primarily due to funds used in operating activities, offset by the first instalment of US$5 million received in April 2010 pursuant to the KIACTA™ Asset Purchase and License Agreement.

The Company's consolidated financial statements and accompanying Management's Discussion and Analysis for the three and nine-month periods ended September 30, 2010, will be available in the coming days on SEDAR at [ www.sedar.com ] and shortly on the Company's web site at [ www.bellushealth.com ].

2010 Third Quarter Highlights:

Strategic Initiatives to Reduce Burn Rate

On August 9, 2010, the Company announced that it would be focusing on supporting its current and future strategic partnerships and on undertaking less expensive product development programs for NRM8499 in order to reduce its burn rate and extend its cash resources. The Company further announced that as a result of these initiatives, it would gradually reduce its head count by more than two thirds over a period of twelve months. The one-time costs associated with this reduction, totalling approximately $1,722,000, were expensed in the current quarter.

Nutraceutical Product VIVIMIND™

On September 30, 2010, a Natural Health Product number ("NPN") was issued by Health Canada for VIVIMIND™. The NPN grants VIVIMIND™ formal authorization for sale in Canada.    

Subsequent Event:

VIVIMIND™ Licence and Supply Agreement

On October 19, 2010, the Company, with the approval of a Special Committee of the Board of Directors, signed a licence and supply agreement with FB Health LLC ("FB Health") pursuant to which the Company granted FB Health exclusive distribution rights for VIVIMIND™ in Italy for consideration consisting primarily of up to €3 million in commercial milestone payments should certain mutually agreed upon sales targets be achieved. The license and supply agreement also provides for BELLUS Health to supply the product to FB Health at a pre-agreed transfer price. FB Health is a newly created Italian nutraceutical company controlled by Dr. Francesco Bellini, Chairman of the Board of Directors of BELLUS Health.

About BELLUS Health

BELLUS Health is a development-focused health company concentrating on research and development of products that provide innovative health solutions and address critical unmet medical needs. For further information, please visit [ www.bellushealth.com ].

Forward Looking Statements

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, inherently involve numerous risks and uncertainties, known and unknown, many of which are beyond BELLUS Health Inc.'s control. Such risks include but are not limited to: the impact of general economic conditions, general conditions in the pharmaceutical and/or nutraceutical industry, changes in the regulatory environment in the jurisdictions in which the BELLUS Health Group does business, stock market volatility, fluctuations in costs, and changes to the competitive environment due to consolidation, that actual results may vary once the final and quality-controlled verification of data and analyses has been completed, as well as other risks disclosed in public filings of BELLUS Health Inc. Consequently, actual future results may differ materially from the anticipated results expressed in the forward-looking statements. The reader should not place undue reliance, if any, on any forward-looking statements included in this news release. These statements speak only as of the date made and BELLUS Health Inc. is under no obligation and disavows any intention to update or revise such statements as a result of any event, circumstances or otherwise, unless required by applicable legislation or regulation. Please see the Annual Information Form of BELLUS Health Inc. for further risk factors that might affect the BELLUS Health Group and its business.