GTx Inc. (GTXI, Financial) filed Quarterly Report for the period ended 2010-06-30.
Gtx Inc. has a market cap of $122.74 million; its shares were traded at around $3.37 with a P/E ratio of 12.96 and P/S ratio of 8.33. Gtx Inc. had an annual average earning growth of 6.7% over the past 5 years.
We have financed our operations and internal growth primarily through public offerings and private placements of our common stock, as well as payments from our current and former collaborations. As a result of the recognition of $49.9 million in deferred revenue and the final payment from Merck of $5.0 million of cost reimbursement, we expect to report net income for the year ending December 31, 2010. However, while recognition of this revenue is expected to result in net income for 2010, we expect to incur significant operating losses in 2011 and for the foreseeable future and we do not expect to obtain FDA or any other regulatory approvals to market any of our product candidates in the near future, if at all. In addition, significant additional clinical development will be required in order to potentially obtain FDA approval of toremifene 80 mg, including a second pivotal Phase III clinical trial of toremifene 80 mg.
At June 30, 2010, we had cash, cash equivalents and short-term investments of $28.4 million, compared to $49.0 million at December 31, 2009. We estimate that our current cash and cash equivalent balances, short-term investments, interest income, product revenue from the sale of FARESTON®, and the final payment from Merck of $5.0 million of cost reimbursement will be sufficient to meet our projected operating requirements through the next twelve months. We have based this estimate on our current business plan and assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect. In addition, this estimate does not include any costs related to any additional clinical development of our SARM program, nor does it include any additional costs that we may be required to bear to continue the development of toremifene 80 mg if the funding from Ipsen is not sufficient to pay all clinical trial costs of a second pivotal Phase III clinical trial of toremifene 80 mg. Before undertaking any of these additional activities and requirements, we will need to raise additional funds and/or receive commitments from partners to pay for some or all of these additional costs. With the exception of payments that we may receive under our collaboration with Ipsen, we do not currently have any commitments for future external funding.
The factors that drive the actual development period of a pharmaceutical product are inherently uncertain and include determining the timing and expected costs to complete the project, projecting regulatory approvals and anticipating potential delays. We use all of these factors in initially estimating the economic useful lives of our performance obligations, and we also continually monitor these factors for indications of appropriate revisions. We have estimated the performance obligation period to be ten years for the development of toremifene under our collaboration agreement with Ipsen which is based upon the estimated development period for toremifene 80 mg. We estimated the performance obligation period to be ten years for our collaboration agreement with Merck. However, due to the termination of our license and collaboration agreement with Merck in March 2010, we recognized as collaboration revenue in the first quarter of 2010 all of the remaining $49.9 million of unamortized revenue that was deferred as of December 31, 2009, as well as the final payment of $5.0 million for cost reimbursement for research and development activities that we will receive from Merck in December 2010 as we have no further performance obligations.
Total share-based compensation expense for the three months ended June 30, 2010 was $1.1 million, of which $454,000 and $625,000 were recorded in the condensed statement of operations as research and development expenses and general and administrative expenses, respectively. Total share-based compensation expense for the three months ended June 30, 2009 was $1.1 million, of which $389,000 and $675,000 were recorded in the condensed statement of operations as research and development expenses and general and administrative expenses, respectively. Total share-based compensation expense for the six months ended June 30, 2010 was $2.8 million, of which $1.3 million and $1.5 million were recorded in the condensed statement of operations as research and development expenses and general and administrative expenses, respectively. Total share-based compensation expense for the six months ended June 30, 2009 was $2.1 million, of which $769,000 and $1.4 million were recorded in the condensed statement of operations as research and development expenses and general and administrative expenses, respectively. Included in share-based compensation expense for the three months ended June 30, 2010 and 2009 was share-based compensation expense related to deferred compensation arrangements for our non-employee directors of $46,000 and $39,000, respectively, and $96,000 and $84,000 for the six months ended June 30, 2010 and 2009, respectively. At June 30, 2010, the total compensation cost related to non-vested awards not yet recognized was approximately $13.2 million with a weighted average expense recognition period of 2.09 years.
Revenues. Revenues for the three months ended June 30, 2010 were $935,000, as compared to $3.8 million for the same period of 2009. Revenues included net sales of FARESTON® marketed for the treatment of metastatic breast cancer in postmenopausal women, collaboration revenue from Ipsen for the three months ended June 30, 2010 and collaboration revenue from Ipsen and Merck for the three months ended June 30, 2009. During the three months ended June 30, 2010 and 2009, FARESTON® net product sales were $599,000 and $949,000, respectively, while cost of product sales were $134,000 and $431,000, respectively. FARESTON® net product sales for the three months ended June 30, 2010 decreased from the same period in the prior year due to a decrease in sales volume and an increase in the provision for product returns due to an increase in the price of FARESTON® in the second quarter of 2010. While we do not expect a material increase in the volume of product returns in future periods as a result of the price increase, the price increase resulted in an increase in the product returns accrual since certain product returns are accepted at or near the current sales price of FARESTON®. These decreases were partially offset by an increase in the sales price of FARESTON® during the second quarter of 2010. Cost of product sales decreased from the same period in the prior year due to the lower sales volume as well as a reduction in the royalty payable to Orion on our net sales of FARESTON®. Collaboration revenue was $336,000 for the three months ended June 30, 2010 and $2.9 million for the three months ended June 30, 2009. Collaboration revenue for the three months ended June 30, 2010 consisted solely of the amortization of deferred revenue from Ipsen. Collaboration revenue for the three months ended June 30, 2009 consisted of $1.5 million and $1.4 million from the amortization of deferred revenue from Ipsen and Merck, respectively. The collaboration revenue recognized from Ipsen for the three months ended June 30, 2010 decreased from the same period of the prior year as we extended the estimated development period to ten years due to our increased obligation p
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Gtx Inc. has a market cap of $122.74 million; its shares were traded at around $3.37 with a P/E ratio of 12.96 and P/S ratio of 8.33. Gtx Inc. had an annual average earning growth of 6.7% over the past 5 years.
Highlight of Business Operations:
Our net income for the six months ended June 30, 2010 was $31.4 million. Our net income included the recognition of the remaining $49.9 million of unamortized revenue from our exclusive license and collaboration agreement with Merck and the final payment from Merck of $5.0 million of cost reimbursement for research and development activities that will be received from Merck in December 2010. Our net income also included FARESTON® net product sales of $1.4 million for the six months ended June 30, 2010.We have financed our operations and internal growth primarily through public offerings and private placements of our common stock, as well as payments from our current and former collaborations. As a result of the recognition of $49.9 million in deferred revenue and the final payment from Merck of $5.0 million of cost reimbursement, we expect to report net income for the year ending December 31, 2010. However, while recognition of this revenue is expected to result in net income for 2010, we expect to incur significant operating losses in 2011 and for the foreseeable future and we do not expect to obtain FDA or any other regulatory approvals to market any of our product candidates in the near future, if at all. In addition, significant additional clinical development will be required in order to potentially obtain FDA approval of toremifene 80 mg, including a second pivotal Phase III clinical trial of toremifene 80 mg.
At June 30, 2010, we had cash, cash equivalents and short-term investments of $28.4 million, compared to $49.0 million at December 31, 2009. We estimate that our current cash and cash equivalent balances, short-term investments, interest income, product revenue from the sale of FARESTON®, and the final payment from Merck of $5.0 million of cost reimbursement will be sufficient to meet our projected operating requirements through the next twelve months. We have based this estimate on our current business plan and assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect. In addition, this estimate does not include any costs related to any additional clinical development of our SARM program, nor does it include any additional costs that we may be required to bear to continue the development of toremifene 80 mg if the funding from Ipsen is not sufficient to pay all clinical trial costs of a second pivotal Phase III clinical trial of toremifene 80 mg. Before undertaking any of these additional activities and requirements, we will need to raise additional funds and/or receive commitments from partners to pay for some or all of these additional costs. With the exception of payments that we may receive under our collaboration with Ipsen, we do not currently have any commitments for future external funding.
The factors that drive the actual development period of a pharmaceutical product are inherently uncertain and include determining the timing and expected costs to complete the project, projecting regulatory approvals and anticipating potential delays. We use all of these factors in initially estimating the economic useful lives of our performance obligations, and we also continually monitor these factors for indications of appropriate revisions. We have estimated the performance obligation period to be ten years for the development of toremifene under our collaboration agreement with Ipsen which is based upon the estimated development period for toremifene 80 mg. We estimated the performance obligation period to be ten years for our collaboration agreement with Merck. However, due to the termination of our license and collaboration agreement with Merck in March 2010, we recognized as collaboration revenue in the first quarter of 2010 all of the remaining $49.9 million of unamortized revenue that was deferred as of December 31, 2009, as well as the final payment of $5.0 million for cost reimbursement for research and development activities that we will receive from Merck in December 2010 as we have no further performance obligations.
Total share-based compensation expense for the three months ended June 30, 2010 was $1.1 million, of which $454,000 and $625,000 were recorded in the condensed statement of operations as research and development expenses and general and administrative expenses, respectively. Total share-based compensation expense for the three months ended June 30, 2009 was $1.1 million, of which $389,000 and $675,000 were recorded in the condensed statement of operations as research and development expenses and general and administrative expenses, respectively. Total share-based compensation expense for the six months ended June 30, 2010 was $2.8 million, of which $1.3 million and $1.5 million were recorded in the condensed statement of operations as research and development expenses and general and administrative expenses, respectively. Total share-based compensation expense for the six months ended June 30, 2009 was $2.1 million, of which $769,000 and $1.4 million were recorded in the condensed statement of operations as research and development expenses and general and administrative expenses, respectively. Included in share-based compensation expense for the three months ended June 30, 2010 and 2009 was share-based compensation expense related to deferred compensation arrangements for our non-employee directors of $46,000 and $39,000, respectively, and $96,000 and $84,000 for the six months ended June 30, 2010 and 2009, respectively. At June 30, 2010, the total compensation cost related to non-vested awards not yet recognized was approximately $13.2 million with a weighted average expense recognition period of 2.09 years.
Revenues. Revenues for the three months ended June 30, 2010 were $935,000, as compared to $3.8 million for the same period of 2009. Revenues included net sales of FARESTON® marketed for the treatment of metastatic breast cancer in postmenopausal women, collaboration revenue from Ipsen for the three months ended June 30, 2010 and collaboration revenue from Ipsen and Merck for the three months ended June 30, 2009. During the three months ended June 30, 2010 and 2009, FARESTON® net product sales were $599,000 and $949,000, respectively, while cost of product sales were $134,000 and $431,000, respectively. FARESTON® net product sales for the three months ended June 30, 2010 decreased from the same period in the prior year due to a decrease in sales volume and an increase in the provision for product returns due to an increase in the price of FARESTON® in the second quarter of 2010. While we do not expect a material increase in the volume of product returns in future periods as a result of the price increase, the price increase resulted in an increase in the product returns accrual since certain product returns are accepted at or near the current sales price of FARESTON®. These decreases were partially offset by an increase in the sales price of FARESTON® during the second quarter of 2010. Cost of product sales decreased from the same period in the prior year due to the lower sales volume as well as a reduction in the royalty payable to Orion on our net sales of FARESTON®. Collaboration revenue was $336,000 for the three months ended June 30, 2010 and $2.9 million for the three months ended June 30, 2009. Collaboration revenue for the three months ended June 30, 2010 consisted solely of the amortization of deferred revenue from Ipsen. Collaboration revenue for the three months ended June 30, 2009 consisted of $1.5 million and $1.4 million from the amortization of deferred revenue from Ipsen and Merck, respectively. The collaboration revenue recognized from Ipsen for the three months ended June 30, 2010 decreased from the same period of the prior year as we extended the estimated development period to ten years due to our increased obligation p
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