þ
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QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
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o
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
Delaware
|
83-0221517
|
|
(State or other jurisdiction |
(I.R.S. Employer
I.D. No.)
|
|
of (I.R.S. Employer I.D. No.) | ||
2600 Stemmons Frwy, Suite 176,
Dallas, TX 75207
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||
(Address of
principal executive offices)
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(214)
905-5100
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||||
(Registrant’s
telephone number, including area code)
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||||
Large
accelerated filer o
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Accelerated
filer o
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Non-accelerated
filer o
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Smaller
reporting company þ
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|||
(Do
not check if a smaller reporting
company)
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INDEX
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||||||||
Page
No.
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||||||||
PART
I - FINANCIAL INFORMATION
|
||||||||
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|
|||||||
Item 1. |
Financial
Statements:
|
|||||||
Condensed
Consolidated Balance Sheets at September 30, 2009
|
||||||||
(unaudited)
and December 31, 2008
|
15
|
|||||||
Condensed
Consolidated Statements of Operations (unaudited) for the
|
||||||||
three
and nine months ended September 30, 2009 and September 30,
2008
|
16
|
|||||||
Condensed
Consolidated Statement of Stockholders’ Deficit
(unaudited)
|
||||||||
for
the nine months ended September 30, 2009
|
17
|
|||||||
Condensed
Consolidated Statements of Cash Flows (unaudited) for
the
|
||||||||
nine
months ended September 30, 2009 and September 30, 2008
|
18
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|||||||
Notes
to Unaudited Condensed Consolidated Financial Statements
|
19
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|||||||
Item
2.
|
Management's
Discussion and Analysis of Financial Condition and
|
|||||||
Results
of Operations
|
2
|
|||||||
Item
3.
|
Quantitative
and Qualitative Disclosures About Market Risk
|
9
|
||||||
Item
4T.
|
Controls
and Procedures
|
9
|
||||||
PART
II - OTHER INFORMATION
|
||||||||
Item
1.
|
Legal
Proceedings
|
10
|
||||||
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
10
|
||||||
Item
3.
|
Defaults
Under Senior Securities
|
10
|
||||||
Item
4.
|
Submission
of Matters to a Vote of Security Holders
|
11
|
||||||
Item
5.
|
Other
Information
|
11
|
||||||
Item
6.
|
Exhibits
|
11
|
||||||
SIGNATURES
|
14
|
|||||||
CERTIFICATIONS
|
ITEM 1. | FINANCIAL STATEMENTS |
ITEM
2.
|
MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
|
·
|
MuGard™
is our approved product for the management of oral mucositis, a frequent
side-effect of cancer therapy for which there is no established treatment.
The market for mucositis treatment is estimated to be in excess of $1
billion world-wide. MuGard, a proprietary nanopolymer formulation, has
received marketing approval in the U.S. from the Food & Drug
Administration (“FDA”). MuGard has been launched in Germany, Italy, UK and
Greece by our European commercial partner,
SpePharm.
|
·
|
Our
lead product candidate in development for the treatment of cancer is
ProLindac™, a nanopolymer DACH-platinum prodrug. We recently completed a
Phase 2 clinical trial on ProLindac in the EU in patients with ovarian
cancer. The clinical study had positive safety and efficacy results. We
are currently planning a number of combination trials, looking at
combining ProLindac with other cancer agents such as taxol and
gemcitabine, in solid tumor indications including colorectal and ovarian.
The DACH-platinum incorporated in ProLindac is the same active moiety as
that in oxaliplatin (Eloxatin; Sanofi-Aventis), which has generated
cumulative sales in excess of $2.0
billion.
|
·
|
Thiarabine,
or 4-thio Ara-C, is a next generation nucleoside analog licensed from
Southern Research Institute. Previously named SR9025 and OSI-7836, the
compound has been in two Phase 1/2 solid tumor human clinical trials and
was shown to have anti-tumor activity. We are working with leukemia and
lymphoma specialists at MD Anderson Cancer Center in Houston and intend to
initiate additional Phase 2 clinical trials in adult AML, ALL and other
indications.
|
·
|
Cobalamin™
is our proprietary preclinical nanopolymer oral drug delivery technology
based on the natural vitamin B12 oral uptake mechanism. We are currently
developing a product for the oral delivery of insulin, and are conducting
sponsored development of a product for oral delivery of human growth
hormone.
|
·
|
Cobalamin-mediated
cancer targeted delivery is a preclinical technology which makes use of
the fact that cell surface receptors for vitamins such as B12 are often
overexpressed by cancer cells.
|
Compound
|
Originator
|
Technology
|
Indication
|
Clinical
Stage (1)
|
||||
MuGard™
|
Access
|
Mucoadhesive
liquid
|
Mucositis
|
(510k)
Marketing clearance received
|
||||
ProLindacTM
(Polymer
Platinate,
AP5346)
|
Access
/
Univ
of
London
|
Synthetic
polymer
|
Cancer
|
Phase
2
|
||||
Thiarabine
(4-thio Ara-C)
|
Southern
Research
Institute
|
Small
molecule
|
Cancer
|
Phase
1/2
|
||||
Oral
Insulin
|
Access
|
Cobalamin
|
Diabetes
|
Pre-clinical
|
||||
Oral
Delivery System
|
Access
|
Cobalamin
|
Various
|
Pre-clinical
|
||||
Cobalamin-Targeted
Therapeutics
|
Access
|
Cobalamin
|
Anti-tumor
|
Pre-clinical
|
(1)
|
For
more information, see “Government Regulation” under Item 1 in our Annual
Report on Form 10-K for the year endedDecember 31,
2008.
|
·
|
lower
costs for product manufacturing for a new ProLindac clinical trial in 2009
as some manufacturing is complete and a clinical trial has started
($444,000);
|
·
|
research
and development expenses incurred by MacroChem in the third quarter of
2008, which are no longer ongoing
($386,000);
|
·
|
lower
scientific consulting expenses
($149,000);
|
·
|
lower
salary and related expenses
($129,000);
|
·
|
other
net decreases in research spending ($92,000);
and
|
·
|
offset
by higher expenses due to the cost of option grants
($91,000).
|
·
|
higher
shareholder consultant expenses ($2,012,000) to inform investors about
Access and to expand our shareholder
base;
|
·
|
higher
business professional expenses
($371,000);
|
·
|
higher
expenses due to the cost of option grants
($89,000);
|
·
|
offset
by general and administrative expenses incurred by MacroChem in the third
quarter of 2008 that are no longer ongoing
($732,000);
|
·
|
lower
accrual of potential liquidated damages under an investor rights agreement
with certain investors ($205,000);
|
·
|
lower
director and officer insurance and lower director fees ($111,000) due to
lower insurance costs and directors taking options instead of fees in
2009;
|
·
|
lower
salary and related expenses ($83,000);
and
|
·
|
other
net decreases in general and administrative expenses
($50,000).
|
·
|
the
Somanta acquisition resulted in a one-time non-cash in-process research
and development expense in the first quarter of 2008
($8,879,000);
|
·
|
MacroChem’s
acquisition of Virium on April 18, 2008 which resulted in a one-time
non-cash in-process research and development expense
($9,657,000);
|
·
|
research
and development expenses incurred by MacroChem in the first nine months of
2008, which are no longer ongoing
($851,000);
|
·
|
lower
costs for product manufacturing due to the start of a new ProLindac
clinical trial
($1,038,000);
|
·
|
lower
salary and related expenses
($189,000);
|
·
|
lower
scientific consulting expenses
($210,000);
|
·
|
lower
travel expenses
($84,000);
|
·
|
other
net decreases in research spending ($130,000);
and
|
·
|
offset
by higher expenses due to option grants
($186,000).
|
·
|
general
and administrative expenses incurred by MacroChem in the first nine months
of 2008 that are no longer ongoing
($2,728,000);
|
·
|
lower
director and officer insurance and lower director fees ($137,000) due to
lower insurance costs and directors taking options instead of fees in
2009;
|
·
|
lower
salary and related expenses
($121,000);
|
·
|
lower
legal and accounting expenses
($93,000);
|
·
|
other
net decreases in general and administrative expenses
($58,000);
|
·
|
offset
by higher shareholder consultant expenses ($2,165,000) to inform investors
about Access and to expand our shareholder
base;
|
·
|
higher
business professional expenses ($737,000);
and
|
·
|
higher
expenses due to the cost of option grants
($162,000).
|
ITEM
3.
|
QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK
|
ITEM 1. | LEGAL PROCEEDINGS |
ITEM 2. |
UNREGISTERED
SALES OF EQUITY SECURITIES AND USE OF
PROCEED
|
ITEM 3. | DEFAULTS UPON SENIOR SECURITIES |
ITEM 4. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS |
ITEM 5. | OTHER INFORMATION |
ITEM 6. |
EXHIBITS
|
2.2
|
Agreement
and Plan of Merger, by and among Access Pharmaceuticals, Inc., Somanta
Acquisition Corporation, Somanta Pharmaceuticals, Inc., Somanta
Incorporated and Somanta Limited, dated April 18, 2007. (Incorporated by
reference to Exhibit 2.1 to our Form 8-K dated April 18,
2007)
|
2.3
|
Agreement
and Plan of Merger, by and among Access Pharmaceuticals, Inc., MACM
Acquisition Corporation and MacroChem Corporation, dated July 9,
2008.
|
3.1
|
Certificate
of Incorporation (Incorporated by Reference to Exhibit 3(a) of our Form
8-B dated July 12, 1989, Commission File Number
9-9134)
|
3.3
|
Certificate
of Merger filed January 25, 1996. (Incorporated by reference to Exhibit E
of our Registration Statement on Form S-4 dated December 21, 1995,
Commission File No. 33-64031)
|
3.4
|
Certificate
of Amendment of Certificate of Incorporation filed January 25, 1996.
(Incorporated by reference to Exhibit E of our Registration Statement on
Form S-4 dated December 21, 1995, Commission File No.
33-64031)
|
3.5
|
Certificate
of Amendment of Certificate of Incorporation filed July 18, 1996.
(Incorporated by reference to Exhibit 3.8 of our Form 10-K for the year
ended December 31, 1996)
|
3.6
|
Certificate
of Amendment of Certificate of Incorporation filed June 18, 1998.
(Incorporated by reference to Exhibit 3.8 of our Form 10-Q for the quarter
ended June 30, 1998)
|
3.7
|
Certificate
of Amendment of Certificate of Incorporation filed July 31, 2000.
(Incorporated by reference to Exhibit 3.8 of our Form 10-Q for the quarter
ended March 31, 2001)
|
3.8
|
Certificate
of Designations of Series A Junior Participating Preferred Stock filed
November 7, 2001 (Incorporated by reference to Exhibit 4.1.h of our
Registration Statement on Form S-8, dated December 14, 2001, Commission
File No. 333-75136)
|
3.9
|
Amended
and Restated Bylaws (Incorporated by reference to Exhibit 3.1 of our Form
10-Q for the quarter ended June 30,
1996)
|
3.10
|
Certificate
of Designations, Rights and Preferences of Series A Cumulative Convertible
Preferred Stock (Incorporated by reference to Exhibit 3.10 to our Form
10-K for the year ended December 31,
2007)
|
3.11
|
Certificate
of Amendment to Certificate of Designations, Rights and Preferences of
Series A Cumulative Convertible Preferred Stock filed June 11, 2008 (Incorporated
by reference to Exhibit 3.11 of our Form 10-Q for the quarter ended June
30, 2008)
|
31.1
|
Certification
of Chief Executive Officer of Access Pharmaceuticals, Inc. pursuant to
Rule 13a-14(a)/15d-14(a)
|
31.2
|
Certification
of Chief Financial Officer of Access Pharmaceuticals, Inc. pursuant to
Rule 13a-14(a)/15d-14(a)
|
32.1*
|
Certification
of Chief Executive Officer of Access Pharmaceuticals, Inc. pursuant to 18
U.S.C. Section 1350
|
32.2*
|
Certification
of Chief Financial Officer of Access Pharmaceuticals, Inc. pursuant to 18
U.S.C. Section 1350
|
Date:
|
November 16, 2009
|
By:
|
/s/ Jeffrey B. Davis
|
Jeffrey
B. Davis
|
|||
Chief
Executive Officer
|
|||
(Principal
Executive Officer)
|
|||
Date:
|
November 16, 2009
|
By:
|
/s/ Stephen B. Thompson
|
Stephen
B. Thompson
|
|||
Vice
President and Chief Financial Officer
|
|||
(Principal
Financial and Accounting Officer
|
|||
ASSETS
|
September 30, 2009
|
December 31, 2008
|
|
(unaudited)
|
(unaudited)
(See
Note 4)
|
||
Current
assets
Cash and cash
equivalents
Receivables
Prepaid expenses and other
current assets
|
$ 1,672,000
23,000
45,000
|
$ 2,677,000
147,000
175,000
|
|
Total
current assets
|
1,740,000
|
2,999,000
|
|
Property
and equipment, net
|
59,000
|
95,000
|
|
Patents,
net
|
840,000
|
999,000
|
|
Other
assets
|
66,000
|
78,000
|
|
Total
assets
|
$ 2,705,000
|
$ 4,171,000
|
|
LIABILITIES
AND STOCKHOLDERS' DEFICIT
|
|||
Current
liabilities
Accounts
payable
Accrued
expenses
Dividends
payable
Accrued
interest payable
Notes
payable
Current
portion of deferred revenue
|
$ 3,692,000
1,208,000
2,294,000
446,000
-
352,000
|
$ 3,287,000
1,295,000
1,896,000
145,000
825,000
164,000
|
|
Total current liabilities |
7,992,000
|
7,612,000
|
|
Long-term
deferred revenue
Long-term
debt
|
4,812,000
5,500,000
|
2,245,000
5,500,000
|
|
Total
liabilities
|
18,304,000
|
15,357,000
|
|
Commitments
and contingencies
|
|||
Stockholders'
deficit
Convertible
Series A preferred stock - $.01 par value; authorized
2,000,000
shares; 2,992.3617 issued and outstanding at
September 30, 2009
and 3,242.8617 at December 31, 2008
Common
stock - $.01 par value; authorized 100,000,000 shares;
issued,
13,111,545 at September 30, 2009 and 9,467,474 at
December
31, 2008
Additional
paid-in capital
Notes
receivable from stockholders
Treasury
stock, at cost – 163 shares
Accumulated
deficit
|
-
131,000
231,106,000
(1,045,000)
(4,000)
(245,787,000)
|
-
95,000
225,753,000
(1,045,000)
(4,000)
(235,985,000)
|
|
Total stockholders' deficit |
(15,599,000)
|
(11,186,000)
|
|
Total
liabilities and stockholders' deficit
|
$ 2,705,000
|
$ 4,171,000
|
Three months ended
September 30,
|
Nine months ended
September 30,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
(See
Note 4)
|
(See
Note 4)
|
(See
Note 4)
|
||||||||||||||
Revenues
|
||||||||||||||||
License
revenues
|
$ | 124,000 | $ | 38,000 | $ | 228,000 | $ | 77,000 | ||||||||
Royalties
|
20,000 | - | 20,000 | - | ||||||||||||
Sponsored research and
development
|
- | 9,000 | - | 140,000 | ||||||||||||
Total revenues
|
144,000 | 47,000 | 248,000 | 217,000 | ||||||||||||
Expenses
|
||||||||||||||||
Research and
development
|
561,000 | 1,670,000 | 1,830,000 | 22,682,000 | ||||||||||||
General and
administrative
|
3,458,000 | 2,167,000 | 6,212,000 | 6,285,000 | ||||||||||||
Depreciation and
amortization
|
65,000 | 80,000 | 197,000 | 246,000 | ||||||||||||
Total expenses
|
4,084,000 | 3,917,000 | 8,239,000 | 29,213,000 | ||||||||||||
Loss
from operations
|
(3,940,000 | ) | (3,870,000 | ) | (7,991,000 | ) | (28,996,000 | ) | ||||||||
Interest
and miscellaneous income
|
2,000 | 32,000 | 18,000 | 173,000 | ||||||||||||
Interest
and other expense
|
(133,000 | ) | (183,000 | ) | (395,000 | ) | (512,000 | ) | ||||||||
(131,000 | ) | (151,000 | ) | (377,000 | ) | (339,000 | ) | |||||||||
Net
loss
|
(4,071,000 | ) | (4,021,000 | ) | (8,368,000 | ) | (29,335,000 | ) | ||||||||
Less
preferred stock dividends
|
471,000 | 523,000 | 1,434,000 | 2,873,000 | ||||||||||||
Net
loss allocable to common stockholders
|
$ | (4,542,000 | ) | $ | (4,544,000 | ) | $ | (9,802,000 | ) | $ | (32,208,000 | ) | ||||
Basic
and diluted loss per common share
Net
loss allocable to common shareholders
|
$ | (0.37 | ) | $ | (0.55 | ) | $ | (0.86 | ) | $ | (3.97 | ) | ||||
Weighted
average basic and diluted
common shares
outstanding
|
12,204,696 | 8,303,457 | 11,375,793 | 8,107,247 | ||||||||||||
Common Stock
|
Preferred Stock
|
Additional
paid-in
capital
|
Notes
receivable from
stockholders
|
Treasury
stock
|
Accumulated
deficit
|
|||
Shares
|
Amount
|
Shares
|
Amount
|
Access-MacroChem,
as
if combined at
December
31, 2008
(See
Note 4)
|
9,467,000 | $ | 95,000 | 3,242.8617 | $ | - | $ | 225,753,000 | $ | (1,045,000 | ) | $ | (4,000 | ) | $ | (235,985,000 | ) | |||||||||||||||
Common
stock issued for
preferred
dividends
|
894,000 | 9,000 | - | - | 847,000 | - | - | - | ||||||||||||||||||||||||
Warrants
issued for
services
|
- | - | - | - | 24,000 | - | - | - | ||||||||||||||||||||||||
Stock
option
compensation
expense
|
- | - | - | - | 56,000 | - | - | - | ||||||||||||||||||||||||
Common
stock issued to
MacroChem
noteholders
for notes
and accrued
interest
|
859,000 | 8,000 | - | - | 851,000 | - | - | - | ||||||||||||||||||||||||
Common
stock issued to
former
MacroChem
executives
|
95,000 | 1,000 | - | - | 132,000 | - | - | - | ||||||||||||||||||||||||
Preferred
dividends
|
- | - | - | - | - | - | - | (480,000 | ) | |||||||||||||||||||||||
Net
loss
|
- | - | - | - | - | - | - | (2,089,000 | ) | |||||||||||||||||||||||
Balance at
March 31, 2009
|
11,315,000 | 113,000 | 3,242.8617 | - | 227,663,000 | (1,045,000 | ) | (4,000 | ) | (238,554,000 | ) | |||||||||||||||||||||
Warrants
issued for
services
|
- | - | - | - | 27,000 | - | - | - | ||||||||||||||||||||||||
Stock
option
compensation
expense
|
- | - | - | - | 252,000 | - | - | - | ||||||||||||||||||||||||
Preferred
stock converted
into
common stock
|
117,000 | 1,000 | (35.0000 | ) | - | (1,000 | ) | - | - | - | ||||||||||||||||||||||
Common
stock issued to
former
MacroChem
executives
|
30,000 | - | - | - | 64,000 | - | - | - | ||||||||||||||||||||||||
Common
stock issued
for
cash exercise of
options
|
25,000 | - | - | - | 14,000 | - | - | - | ||||||||||||||||||||||||
Restricted
common stock
issued
for services
|
127,000 | 2,000 | - | - | 314,000 | - | - | - | ||||||||||||||||||||||||
Preferred
dividends
|
- | - | - | - | - | - | - | (483,000 | ) | |||||||||||||||||||||||
Net
loss
|
- | - | - | - | - | - | - | (2,208,000 | ) | |||||||||||||||||||||||
Balance at
June 30, 2009
|
11,614,000 | 116,000 | 3,207.8617 | - | 228,333,000 | (1,045,000 | ) | (4,000 | ) | (241,245,000 | ) | |||||||||||||||||||||
Warrants
issued for
services
|
- | - | - | - | 503,000 | - | - | - | ||||||||||||||||||||||||
Stock
option
compensation
expense
|
- | - | - | - | 285,000 | - | - | - | ||||||||||||||||||||||||
Preferred
stock converted
into
common stock
|
719,000 | 8,000 | (215.5000 | ) | - | (8,000 | ) | - | - | - | ||||||||||||||||||||||
Common
stock issued for
preferred
dividends
|
21,000 | - | - | - | 71,000 | - | - | - | ||||||||||||||||||||||||
Common
stock issued
for
cash exercise of
options
|
210,000 | 2,000 | - | - | 142,000 | - | - | - | ||||||||||||||||||||||||
Common
stock issued
for
warrant exercises
|
33,000 | - | - | - | - | - | - | - | ||||||||||||||||||||||||
Restricted
common stock
issued
for services
|
515,000 | 5,000 | - | - | 1,780,000 | - | - | - | ||||||||||||||||||||||||
Preferred
dividends
|
- | - | - | - | - | - | - | (471,000 | ) | |||||||||||||||||||||||
Net
loss
|
- | - | - | - | - | - | - | (4,071,000 | ) | |||||||||||||||||||||||
Balance at
September 30, 2009
|
13,112,000 | $ | 131,000 | 2,992.3617 | $ | - | $ | 231,106,000 | $ | (1,045,000 | ) | $ | (4,000 | ) | $ | (245,787,000 | ) | |||||||||||||||
Nine
Months ended September 30,
|
||||||||
2009
|
2008
|
|||||||
Cash
flows from operating activities:
|
||||||||
Net
loss
|
$ | (8,368,000 | ) | $ | (29,335,000 | ) | ||
Adjustments to
reconcile net loss to net cash used
in
operating activities:
|
||||||||
Depreciation and
amortization
|
197,000 | 245,000 | ||||||
Stock option compensation
expense
|
593,000 | 899,000 | ||||||
Stock and warrants issued for
services
|
2,852,000 | 427,000 | ||||||
Acquired in-process research
and development
|
- | 18,536,000 | ||||||
Change in operating assets and
liabilities:
|
||||||||
Receivables
|
124,000 | (295,000 | ) | |||||
Prepaid
expenses and other current assets
|
130,000 | (121,000 | ) | |||||
Other assets
|
12,000 | - | ||||||
Accounts payable and accrued
expenses
|
318,000 | 317,000 | ||||||
Dividends
payable
|
(109,000 | ) | (25,000 | ) | ||||
Accrued interest
payable
|
334,000 | 315,000 | ||||||
Deferred
revenue
|
2,755,000 | 1,475,000 | ||||||
Net cash used in operating
activities
|
(1,162,000 | ) | (7,562,000 | ) | ||||
Cash
flows from investing activities:
|
||||||||
Capital
expenditures
|
(2,000 | ) | (31,000 | ) | ||||
Proceeds from sale of
asset
|
1,000 | - | ||||||
Redemptions of short-term
investments and certificate
of
deposits
|
- | 3,104,000 | ||||||
Virium acquisition by
MacroChem, net of cash acquired
|
- | (240,000 | ) | |||||
Somanta acquisition, net
of cash acquired
|
- | (65,000 | ) | |||||
Net cash provided by (used in)
investing activities
|
(1,000 | ) | 2,768,000 | |||||
Cash
flows from financing activities:
|
||||||||
Proceeds from debt
issuance
|
- | 625,000 | ||||||
Payments
of notes payable
|
- | (639,000 | ) | |||||
Proceeds from exercise of
common stock options
|
158,000 | 15,000 | ||||||
Proceeds
from preferred stock issuances, net of costs
|
- | 2,444,000 | ||||||
Net cash provided by financing
activities
|
158,000 | 2,445,000 | ||||||
Net
decrease in cash and cash equivalents
|
(1,005,000 | ) | (2,349,000 | ) | ||||
Cash
and cash equivalents at beginning of period
|
2,677,000 | 2,582,000 | ||||||
Cash
and cash equivalents at end of period
|
$ | 1,672,000 | $ | 233,000 | ||||
Supplemental
cash flow information:
|
||||||||
Cash
paid for interest
|
$ | - | $ | 9,000 | ||||
Supplemental
disclosure of noncash transactions:
|
||||||||
Shares issued for payables,
notes payable and accrued interest
|
859,000 | 1,576,000 | ||||||
Shares issued for dividends on
preferred stock
|
927,000 | - |
|
|||||
Preferred stock dividends in dividends payable
|
1,434,000 | 2,873,000 | ||||||
Beneficial conversion feature –
February
2008 preferred stock dividends
November 2007 preferred stock dividends correction
|
- - | 857,000 451,000 | ||||||
Preferred
stock issuance costs paid in cash
|
- | 281,000 | ||||||
Debt discount related to MacroChem convertible debt
issuance
|
- | 93,000 |
(1)
|
Interim
Financial Statements
|
September
30, 2009
|
December
31, 2008
|
|||
Gross
carrying
value
|
Accumulated
amortization
|
Gross
carrying
value
|
Accumulated
Amortization
|
|
Amortizable
intangible assets
Patents
|
$ 2,624
|
$ 1,784
|
$ 2,624
|
$1,625
|
2009 |
$ 53
|
|
2010 |
212
|
|
2011 |
212
|
|
2012 |
82
|
|
2013 |
44
|
|
over 5 years |
237
|
|
Total |
$ 840
|
Access
Pharmaceuticals
|
MacroChem
Corporation
|
Combined
|
||||||||||
Current
assets
|
$ | 3,550,000 | $ | 84,000 | $ | 2,999,000 | ||||||
Total
assets
|
4,257,000 | 549,000 | 4,171,000 | |||||||||
Current
liabilities
|
4,906,000 | 3,346,000 | 7,612,000 | |||||||||
Long-term
deferred revenue
|
2,245,000 | 24,000 | 2,245,000 | |||||||||
Long-term
debt
|
5,500,000 | - | 5,500,000 | |||||||||
Stockholders’
deficit
|
(8,394,000 | ) | (2,925,000 | ) | (11,186,000 | ) |
For the nine months ended September 30,
2009
|
For the year ended December 31,
2008
|
|||||
Access
Pharmaceuticals
|
MacroChem
Corporation
|
Combined
|
Access
Pharmaceuticals
|
MacroChem
Corporation
|
Combined
|
Total
revenues
|
$ | 248,000 | $ | - | $ | 248,000 | $ | 291,000 | $ | 4,000 | $ | 295,000 | ||||||||||||
Expenses
|
||||||||||||||||||||||||
Research
and development
|
1,830,000 | - | 1,830,000 | 12,613,000 | 10,622,000 | 23,235,000 | ||||||||||||||||||
General
and administrative
|
6,020,000 | 192,000 | 6,212,000 | 4,340,000 | 3,123,000 | 7,463,000 | ||||||||||||||||||
Depreciation
and
amortization
|
156,000 | 41,000 | 197,000 | 253,000 | 71,000 | 324,000 | ||||||||||||||||||
Total
expenses
|
8,006,000 | 233,000 | 8,239,000 | 17,206,000 | 13,816,000 | 31,022,000 | ||||||||||||||||||
Loss
from operations
|
(7,758,000 | ) | (233,000 | ) | (7,991,000 | ) | (16,915,000 | ) | (13,812,000 | ) | (30,727,000 | ) | ||||||||||||
Interest
and miscellaneous
income
|
18,000 | - | 18,000 | 178,000 | 33,000 | 211,000 | ||||||||||||||||||
Interest
and other expense
|
(369,000 | ) | (26,000 | ) | (395,000 | ) | (478,000 | ) | (433,000 | ) | (911,000 | ) | ||||||||||||
Gain
on change in value of
warrant
liability
|
- | - | - | - | 3,972,000 | 3,972,000 | ||||||||||||||||||
(351,000 | ) | (26,000 | ) | (377,000 | ) | (300,000 | ) | 3,572,000 | 3,272,000 | |||||||||||||||
Loss
from operations
|
(8,109,000 | ) | (259,000 | ) | (8,368,000 | ) | (17,215,000 | ) | (10,240,000 | ) | (27,455,000 | ) | ||||||||||||
Less
preferred stock
dividends
|
(1,434,000 | ) | - | (1,434,000 | ) | (3,358,000 | ) | - | (3,358,000 | ) | ||||||||||||||
Net
loss allocable to
common
stockholders
|
$ | (9,543,000 | ) | $ | (259,000 | ) | $ | (9,802,000 | ) | $ | (20,573,000 | ) | $ | (10,240,000 | ) | $ | (30,813,000 | ) | ||||||
Basic
and diluted loss per
common
share
|
||||||||||||||||||||||||
Net
loss allocable to
common
stockholders
|
- | - | $ | (0.86 | ) | - | - | $ | (3.69 | ) | ||||||||||||||
Weighted
average basic
and
diluted common
shares
outstanding
|
- | - | 11,375,793 | - | - | 8,354,031 |
For the nine months ended September 30,
2008
|
For the three months ended September 30,
2008
|
|||||
Access
Pharmaceuticals
|
MacroChem
Corporation
|
Combined
|
Access
Pharmaceuticals
|
MacroChem
Corporation
|
Combined
|
Total
revenues
|
$ | 217,000 | $ | 3,000 | $ | 220,000 | $ | 47,000 | $ | 1,000 | $ | 48,000 | ||||||||||||
Expenses
|
||||||||||||||||||||||||
Research
and development
|
12,108,000 | 10,574,000 | 22,682,000 | 1,284,000 | 386,000 | 1,670,000 | ||||||||||||||||||
General
and administrative
|
3,372,000 | 2,913,000 | 6,285,000 | 1,439,000 | 728,000 | 2,167,000 | ||||||||||||||||||
Depreciation
and
amortization
|
197,000 | 49,000 | 246,000 | 66,000 | 14,000 | 80,000 | ||||||||||||||||||
Total
expenses
|
15,677,000 | 13,536,000 | 29,213,000 | 2,789,000 | 1,128,000 | 3,917,000 | ||||||||||||||||||
Loss
from operations
|
(15,460,000 | ) | (13,533,000 | ) | (28,993,000 | ) | (2,742,000 | ) | (1,127,000 | ) | (3,869,000 | ) | ||||||||||||
Interest
and miscellaneous
income
|
167,000 | 6,000 | 173,000 | 62,000 | - | 62,000 | ||||||||||||||||||
Interest
and other expense
|
(351,000 | ) | (161,000 | ) | (512,000 | ) | (126,000 | ) | (86,000 | ) | (212,000 | ) | ||||||||||||
Gain
(loss) on change in
warrant
value
|
- | 3,886,000 | 3,886,000 | - | 419,000 | 419,000 | ||||||||||||||||||
(184,000 | ) | 3,731,000 | 3,547,000 | (64,000 | ) | 333,000 | 269,000 | |||||||||||||||||
Loss
from operations
|
(15,644,000 | ) | (9,802,000 | ) | (25,446,000 | ) | (2,806,000 | ) | (794,000 | ) | (3,600,000 | ) | ||||||||||||
Less
preferred stock
dividends
|
(2,873,000 | ) | - | (2,873,000 | ) | (523,000 | ) | - | (523,000 | ) | ||||||||||||||
Net
loss allocable to
common
stockholders
|
$ | (18,517,000 | ) | $ | (9,802,000 | ) | $ | (28,319,000 | ) | $ | (3,329,000 | ) | $ | (794,000 | ) | $ | (4,123,000 | ) | ||||||
Basic
and diluted loss per
common
share
|
||||||||||||||||||||||||
Net
loss allocable to
common
stockholders
|
- | - | $ | (3.49 | ) | - | - | $ | (0.50 | ) | ||||||||||||||
Weighted
average basic
and
diluted common
shares
outstanding
|
- | - | 8,107,242 | - | - | 8,303,457 |
Three months
ended
September 30,
|
Nine months ended
September 30,
|
|||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Research
and development
|
$ | 130,000 | $ | 39,000 | $ | 250,000 | $ | 78,000 | ||||||||
General
and administrative
|
155,000 | 187,000 | 343,000 | 821,000 | ||||||||||||
Stock-based
compensation expense
included
in operating expense
|
$ | 285,000 | $ | 226,000 | $ | 593,000 | $ | 899,000 |
9/30/09
|
9/30/08
|
|||
Expected
life
|
5.5
yrs
|
6.2
yrs
|
||
Risk
free interest rate
|
2.4
|
%
|
3.0
|
%
|
Expected
volatility(a)
|
114
|
%
|
133
|
%
|
Expected
dividend yield
|
0.0
|
%
|
0.0
|
%
|
(a)
|
Reflects
movements in our stock price over the most recent historical period
equivalent to the expected life.
|