Merrion Pharmaceuticals Plc : Interim Results for the Six Months Ended 30 June 2013

30 September 2013

Interim Results for the Six Months Ended 30 June 2013

Merrion Pharmaceuticals plc, ("Merrion" or the "company") (ESM: MERR) a pharmaceutical development company, announced today its interim results for the six month period ended 30 June 2013.

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Operating highlights

Pharmaceutical development activities

In the first six months of 2013, Merrion continued to work with Novo Nordisk A/S on its oral insulin and oral GLP-1 products. In March 2013, Novo Nordisk successfully completed a single dose Phase I trial for a novel oral insulin with NN1954, which uses Merrion's GIPET technology in its formulation. The aim of this randomised, double-blind placebo and active controlled single ascending dose trial was to investigate the safety, tolerability, pharmacokinetics (exposure of drug) and pharmacodynamics (effect on blood glucose levels) of NN1954.

Under the terms of the license agreements entered into with Novo Nordisk, Merrion receives payments on achievement of certain development, regulatory and sales milestones as well as royalties on sales.  In March 2013, Merrion received a €0.8 million (US$1.0 million) milestone payment following the completion of the NN1954 Phase I trial.

Summary of financial results

• The net loss in the first six months of 2013 decreased by €2.5 million, or 95%, to €0.1 million, primarily driven by a €1.2 million decrease in cost of sales and operating expenses and €0.8 million increase in revenue.
• The 63% decrease in cost of sales and operating expenses reflects cost reductions achieved as a result of the restructuring activities which took place in 2012. These activities included the company ceasing development activities on its own drugs resulting in a reduction in employee headcount.
• Revenues increased €0.8 million to €1.0 million in the first six months of 2013, due to the receipt of a €0.8 million (US$1.0 million) milestone payment from Novo Nordisk on completion of their Phase I trial of an oral insulin with NN1954.
• Net finance expense decreased €0.5 million in the first six months of 2013 to €0.4 million. Net finance expenses in the first six months of 2012 included a €0.3 million loss on the extinguishment of the Hercules Technology Growth Capital's ("HTGC") debt. The decrease in net finance expense is also due to a €0.2 million decrease in foreign exchange losses in 2013.
• Cash and cash equivalents decreased €1.2 million from €2.3 million as of 31 December 2012 to €1.1 million at 30 June 2013. The decrease was primarily attributable to the repayment of the €1.0 million term loan to Irelandia in January 2013, interest payments on the term loans and the secure bank loan, together with principal repayments on the secured bank loan.
•  Total loans and borrowings decreased €1.0 million from €6.4 million as at 31 December 2012 to €5.4 million as at 30 June 2013. The decrease is primarily due to the repayment of the €1.0 million term loan to Irelandia in January 2013. 

Commenting on the results, Michael Donnelly, Executive Chairman said that the restructuring which has been implemented ensures a stable financial position which can take the company through significant value building.

Appointment to the Board of Directors

On 20 August 2013, Gerard Flood was appointed to the Board of Directors as a non-executive director.

Outlook

Commenting further on the outlook for 2013, Michael Donnelly said that Merrion is in discussions with a number of companies on the use of its GIPET technology and is in discussions with the FDA on the scope of a Phase III clinical trial for one of  it's oncology compounds.  

About the Company

Merrion Pharmaceuticals plc (www.merrionpharma.com), ("Merrion" or "the company"), is a publicly listed pharmaceutical development company focused on delivering new innovative oral pharmaceuticals to the market by partnering with other pharmaceutical companies. Established in 2003, Merrion is engaged in the development of oral forms (tablets/capsules) of drugs that have poor absorption and are generally given by injection. Merrion's patented drug delivery technologies increase bioavailability of drugs that are otherwise poorly absorbed by improving absorption in the gastrointestinal tract. This can provide substantial benefits in patient convenience and safety, and might also provide enhanced drug efficacy. Merrion has utilised its technology to develop new oral drugs in two ways; it developed its own proprietary drugs using GIPET and has partnered with other pharmaceutical companies in developing oral GIPET formulations of their products.

Merrion has two license agreements with Novo Nordisk A/S to develop and commercialise oral forms of Novo Nordisk's Insulin and GLP-1 using Merrion's proprietary GIPET technology. In addition, Merrion has a collaboration and option agreement with Novo Nordisk for an undisclosed compound.

Merrion is based in Dublin and is listed on the Enterprise Securities Market of the Irish Stock Exchange (ESM) under the symbol MERR.

 Investor Enquiries:

Investor Enquiries: Davy Corporate Finance Ivan Murphy David Nangle T [phone]