WINNIPEG, MANITOBA (AMEX: MCU), a cardiovascular-focused
biopharmaceutical company, today reported the results of operations
for the three and nine month periods ended February 29, 2008. All
amounts referenced herein are in Canadian dollars unless otherwise
noted. At the close of business on February 29, 2008, the exchange
rate was CAD$1.00 equals US$1.02.
Clinical Update
On February 22, 2008 the Company announced that an analysis of
the data from its pivotal phase 3 MEND-CABG II clinical trial
showed that it did not meet the primary endpoint. The trial was
designed to evaluate the effect of Medicure's lead product MC-1,
versus placebo, on the incidence of cardiovascular death or
nonfatal myocardial infarction up to and including 30 days
following coronary artery bypass graft (CABG) surgery. Based on the
results, the Company does not plan on submitting an application for
MC-1 marketing approval to the U.S. Food and Drug Administration
for the CABG surgery indication at this time.
Although Medicure has decided not to continue pursuing MC-1's
acute clinical development at this time, the Company remains
optimistic in the potential clinical utility of MC-1 in the
treatment of certain chronic cardiovascular and metabolic
conditions, including for the treatment of hypertension, type II
diabetes and dyslipidemia. The Company has been developing MC-1 for
use in two fixed dose combinations for these chronic indications,
including MC-4232 (combination of MC-1 and lisinopril) and MC-4262
(combination of MC-1 and an Angiotensin Receptor Blocker). Due to
the Company's decision to discontinue the development of MC-1 as a
monotherapy for acute indications such as CABG surgery, the Company
may also develop MC-1 as a monotherapy for one or more of these
chronic indications.
Corporate Update
Subsequent to the end of the fiscal period ended February 29,
2008, Medicure announced a restructuring plan upon which the
organization eliminated approximately 50 employees and full-time
consultants.
These changes follow the Company's announcement that it does not
plan on submitting an application for MC-1 marketing approval to
the U.S. Food and Drug Administration for the CABG surgery
indication at this time. This decision was based on an analysis of
the data from its pivotal phase 3 MEND-CABG II clinical trial that
showed that the study did not meet the primary endpoint.
Due to the restructuring of the Company's operations, Charles
Gluchowski, PhD resigned as the Company's Vice President, Research
and Development to pursue other interests. The Company will
continue to work with Dr. Gluchowski on a consulting basis. "We
thank Charlie for his dedicated service, and his commitment to
continue to serve Medicure as an advisor," stated Medicure's
President and CEO, Albert D. Friesen, PhD.
AGGRASTAT� Update
During the third quarter of fiscal 2008, sales of AGGRASTAT�
improved over the prior quarterly results by $379,000 but were
lower as compared to the same period in fiscal 2007.
"We were very pleased with the data recently presented on
AGGRASTAT� at the Late Breaking Sessions of the American College of
Cardiology 57th Annual Scientific Session," commented Dr. Friesen.
"While revenues were lower than the same quarter in the previous
fiscal year, we are encouraged to see growth over the second
quarter of fiscal 2008," stated Dr. Friesen.
Following the fiscal quarter, Medicure's Vice President,
Marketing, Brian Best resigned from his current position due to
personal reasons but will continue to remain active with the
Company in an advisory role going forward. Brian will advise the
commercial operations along with Bonnie Zell, former VP of Sales
with Millennium Pharmaceuticals, Inc. "Brian and Bonnie's
leadership has been instrumental in building a highly skilled sales
force and commercial operation at Medicure", stated Dr. Friesen.
"We are confident that we have a strong commercial plan in place
and look forward to their continued leadership as advisors to build
our commercial operation."
"I continue to be optimistic about the long-term prospects for
AGGRASTAT� and while my position is changing, I look forward to my
continued involvement with the team," commented Brian Best.
Financial Results:
Net product revenues for the third quarter of fiscal 2008 were
$703,000 compared to $2,522,000 for the same period in fiscal 2007.
Revenues for the nine month period to date were $1,506,000 compared
to $4,221,000 in the same period last year.
AGGRASTAT� revenues were lower for the three and nine month
periods ended February 29, 2008 as compared to the same periods in
fiscal 2007 for several reasons including the reconfiguring of the
Company's commercial operations during the first quarter of fiscal
2008. While the Company's focus has been on stabilizing revenues,
it was recognized that the initial commercial structure, which
consisted of a contract sales organization (CSO) was not optimal as
the Company was not able to maintain sufficient control and
direction of the sales organization and has since transitioned to
an internally managed and more cost effective operation. This
transition will require additional time to fully implement and
establish customer relationships in order to stabilize and
eventually increase product revenues.
Research and development expenditures were $6,251,000 in the
third quarter of fiscal 2008 as compared to $6,518,000 in the same
period of fiscal 2007. Research and development expenditures were
slightly lower as compared to the same period in fiscal 2007 due to
the completion of the Phase 3 MEND-CABG II study in the third
quarter of fiscal 2008. Research and development expenditures for
the nine month period to date were $28,720,000 compared to
$13,119,000 for the same period last year.
Selling, general and administrative expenditures decreased by
$801,000 to $2,624,000 during the three-month period ended February
29, 2008 as compared to $3,425,000 in the same period in fiscal
2007. The Company utilized a contracted sales force in the prior
fiscal year, but changed to an internal sales force in the first
quarter of fiscal 2008. This change has resulted in lower costs
incurred in the current fiscal quarter related to AGGRASTAT�
operations. Other selling, general and administrative expenditures
in the current fiscal quarter are consistent with the same period
in fiscal 2007. Selling, general and administrative expenditures
for the nine month period to date totaled $9,720,000 compared to
$7,243,000 for the same period in fiscal 2007.
During the three and nine month periods ending February 29,
2008, the Company recorded a write-down of $13,057,000 for
intangible assets related to MC-1 and AGGRASTAT�. During the
quarter ending February 29, 2008, the Company determined that
conditions had arisen which triggered the need to review certain of
the Company's long lived assets for impairment. In particular,
during the quarter ending February 29, 2008, the Company announced
that the results from the Phase 3 MEND-CABG II clinical trial did
not meet its primary endpoint. Based on the results, the Company
does not plan on submitting an application for MC-1 marketing
approval to the U.S. Food and Drug Administration for the CABG
indication. The Company has decided to discontinue at this time the
development of MC-1 as a monotherapy for acute indications such as
CABG and announced a corporate restructuring in March 2008. These
factors, along with a lower than originally projected AGGRASTAT�
product market share has triggered the need to review the Company's
intangible assets for impairment under CICA Handbook Section 3063.
Section 3063, Impairment of Long-Lived Assets, requires that a
long-lived asset is tested for recoverability whenever events or
changes in circumstances indicate that its carrying amount may not
be recoverable. An impairment loss is recognized as the difference
between fair value and carrying amount when the carrying amount of
a long-lived asset is not recoverable and exceeds its fair value.
The Company has determined that the carrying value of patents,
trademark, technology license, and customer list exceed their fair
value based on discounted future cash flows and market prices for
similar assets.
As a result of the above noted items, the financial results for
the three-month period ended February 29, 2008 include a
consolidated net loss from operations of $22,675,000 or $0.17 per
share, compared to $8,365,000 or $0.08 per share for the
three-month period ended February 28, 2007. The nine month
year-to-date loss for fiscal 2008 was $54,697,000 or $0.44 per
share, compared to $17,704,000 or $0.18 per share for the nine
month period ended February 28, 2007.
At February 29, 2008 the Company had cash and cash equivalents
totaling $29,245,000, which includes $11,812,000 of restricted
cash, as compared to $31,770,000 as of May 31, 2007.
The Company believes it has sufficient resources to fund
operations into the first quarter of fiscal 2009. However, funding
requirements may vary depending on a number of factors including
the progress of the Company's research and development programs,
the securing of a partnership, the revenues generated and expenses
resulting from the Company's AGGRASTAT� operations, the results of
preclinical studies and clinical trials and changes in the focus
and direction of the Company's product development projects.
The Company has experienced a loss of $54,697,495 and negative
cash flows from operations of $36,526,616 in the nine month period
ended February 29, 2008, and the Company has accumulated a deficit
of $132,528,447 as at February 29, 2008. Based on the Company's
operating plan, its existing working capital is not sufficient to
meet the cash requirements to fund the Company's currently planned
operating expenses, capital requirements, working capital
requirements and long-term debt obligations through the first
quarter of fiscal 2009 without additional sources of cash and/or
deferral, reduction or elimination of significant planned
expenditures. The Company's plan to address the expected shortfall
of working capital is to secure additional funding within the next
six months and continue to increase operating revenue and reduce
operating expenses. There is no certainty that the Company will be
able to obtain any sources of financing on acceptable terms, or at
all or that it will increase product revenue.
The ability of the Company to continue as a going concern and to
realize the carrying value of its assets and discharge its
liabilities when due is dependent on many factors, including, but
not limited to the actions taken or planned, some of which are
described above, which management believes will mitigate the
adverse conditions and events which raise doubt about the validity
of the "going concern" assumption used in preparing the Company's
financial statements. There is no certainty that these and other
strategies will be sufficient to permit the Company to continue as
a going concern.
The Company's financial statements do not reflect adjustments
that would be necessary if the "going concern" assumption were not
appropriate. If the "going concern" basis was not appropriate for
these financial statements, then adjustments would be necessary in
the carrying value of assets and liabilities, the reported revenues
and expenses, and the balance sheet classifications used.
An expanded version of Management's Discussion and Analysis and
the financial statements for the three-month period ended February
29, 2008 is accessible on Medicure's website at
www.medicure.com.
Notification of Conference Call:
Date: Tuesday, April 15, 2008
Time: 8:30 AM Eastern Time
Telephone: 1-416-340-8010 or 1-866-540-8136
Webcast: Available at the Medicure website at www.medicure.com
Archive of Conference Call:
Telephone: 1-416-695-5800 or 1-800-408-3053
Passcode: 3258982
Webcast: Available at the Medicure website at www.medicure.com
Expires: April 22, 2008
About Medicure Inc.
Medicure Inc is a biopharmaceutical company focused on the
research, development and commercialization of novel compounds to
treat cardiovascular disorders.
Cardiovascular medicine represents the largest pharmaceutical
sector, with annual global sales of over US $70 billion. Medicure
aims to make a global impact on cardiovascular disease and stroke
by reducing deaths, improving the quality of life and serving the
unmet needs of people who suffer from cardiovascular disease and
stroke.
This press release contains forward-looking statements, as
defined under applicable securities legislation, that involve
risks, which may cause actual results to differ materially from the
statements made, and accordingly may be deemed to be
forward-looking statements made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
The forward-looking statements are made as of the date hereof, and
the Company disclaims any intention and has no obligation or
responsibility to update or revise any forward-looking statements,
whether as a result of new information, future events, or otherwise
except as required by law. Such forward-looking statements involve
known and unknown risks, uncertainties and other factors that may
cause the actual results, events or developments to be materially
different from any future results, events or developments expressed
or implied by such forward-looking statements. Such factors
include, among others, the Company's stage of development, lack of
product revenues, additional capital requirements, risks associated
with the completion of clinical trials and obtaining regulatory
approval to market the Company's products, the ability to protect
its intellectual property, dependence on collaborative partners and
the ability to meet its debt obligations. These factors should be
considered carefully and readers are cautioned not to place undue
reliance on such forward-looking statements. Additional risks and
uncertainties relating to the Company and its business can be found
in the "Risk Factors" section of its Form 20F for the year ended
May 31, 2007 and the Company's MD&A for the third quarter ended
February 29, 2008.
Contacts: Medicure Inc. Derek Reimer Chief Financial Officer
1-888-435-2220 (204) 488-9823 (FAX) Email: info@medicure.com
Website: www.medicure.com
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