Marc Rubin - Executive Chairman
Sunil Bhonsle - President
Titan Pharmaceuticals, Inc. (OTCQB:TTNP) Q2 2013 Earnings Conference Call August 15, 2013 1:00 PM ET
Thank you for holding and welcome to the Titan Pharmaceuticals Second Quarter 2013 Financial Results Conference. At this time all participants are in a listen only mode. Please be advised that this call is being taped at the Company’s request and will be archived on the Company’s website starting later today.
At this time, I would like to turn the call over to Sunil Bhonsle, President of Titan Pharmaceuticals. Please go ahead, sir.
Thank you, Sarah, and thank you all for joining us. Welcome to the Titan Pharmaceuticals call to review the financial and operational results for the second quarter of 2013.
Before we begin, I wanted to inform you that we filed our Form 10-Q with the SEC yesterday detailing our second quarter financial results. The press release issued yesterday provides a summary of the results and can be found on our website at www.titanpharm.com. On the call today from Titan, we have Dr. Marc Rubin, our Executive Chairman.
Before we get into the details of the second quarter performance and an update on the Company, I want to remind everyone that certain matters we will discuss today, other than historical information, consists of forward-looking statements relating to among other things, our expectations concerning our financial results, available cash, development programs, partnering arrangements, regulatory strategies and business plans.
The forward-looking statements are not guarantees of future performance and are subject to a variety of risks and uncertainties that could cause actual results to differ materially from the results contemplated by the forward-looking statements. These risks and uncertainties are described in our Annual Report on Form 10-K filed with the SEC. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of today. We undertake no obligation to update or revise the information provided in this call whether as a results of new information, future events, or circumstances, or otherwise.
Also, once again we have made the decision that hosting a question-and-answer session at the conclusion of today’s call is not appropriate. We fully understand that you want to know as much detail as possible about our plans and timelines for the Probuphine program. However, I'm sure you realize that we cannot disclose any detailed information until we have had a chance to meet with the FDA.
We are working very closely with our partner, Braeburn Pharmaceuticals, and a network of experienced and proven regulatory experts on the plan to respond to issues raised by the FDA. The process is methodical and time consuming, however let me assure you that we are proceeding in the most expeditious and thorough manner and we will provide all of the information and updates that we are able to do during the remarks portion of the call The Titan team is committed to providing you with ongoing updates and additional details as soon as we are able to do so.
So, let's start with an overview from our Executive Chairman, Dr. Marc Rubin. Marc?
Thank you, Sunil, and hello everybody and thank you for joining us today. I think you know the second quarter has been another important quarter for Titan as we, along with our commercialization partner Braeburn Pharmaceuticals, have been working diligently with a team of proven experts with experience in assisting companies through similar regulatory processes and the ability to help assess a broad range of pathways with the ultimate goal of being able to provide Probuphine to those patients that need its potential clinical benefits.
As I believe you all know, on April 30, 2013, the FDA issued a complete response letter or CRL to Titan's NDA for Probuphine requesting, among other things, additional data supporting efficacy and safety of the product and the clinical benefit to patients. The CRL also included recommendations regarding product labelling, human factors testing of the training program, and the implementation of the risk evaluation and mitigation strategy or REMS.
Given the FDA's priority review designation for our Probuphine new drug application and the PDAC members' support for Probuphine approval, we were both surprised and of course disappointed by the CRL. Titan is committed to addressing the concerns raised by the FDA in the CRL and we continue to generate information in preparation of a full and formal response to the CRL issued by the FDA.
Regarding this process, it's important to note that we have made a conscious decision to deliberate all possible ways forward in a detailed analytical process in order to ultimately make the strongest and most compelling case possible to address the FDA's concerns. While we all want to make this move along as quickly as possible, we also want to spend the time necessary to fully analyze all aspects of the data and to be as thorough as possible in our preparation of a complete and compelling response to the CRL.
While understandably this takes longer than some of you might expect or prefer, please be aware that it's being strategically driven by our full commitment to advance Probuphine. In the next several weeks, Titan and Braeburn expect to submit the meeting request to the FDA and we are currently preparing materials that are necessary to support this effort and the NDA. Once the meeting request is submitted, we will be at a much better position to provide guidance on potential timelines.
I'm sure you all realize that we are quite restricted now in what we can share, and this is necessary to maintain confidentiality of the process, especially in terms of discussions with the FDA, but I can assure you that we will do our best to keep you all updated with our progress as we move forward. The Board fully supports this strategy and we look forward to providing more details when available and when appropriate.
We are also very pleased with the publication of the results of the Phase III confirmatory study of Probuphine in Addiction, one of the premier peer-reviewed journals in the area of addiction medicine. Given the nationally recognized growing and devastating opioid-dependence epidemic, there is a critical need for new, safe and effective treatments that reduce the likelihood of abuse, diversion, and accidental pediatric exposure. Our goal remains the same, to make Probuphine available to those clinicians, patients, families that are in need of its potential benefits, and we want to thank you all for your continued support and your patience with this process.
Now for more insights on the second quarter financial results I will pass the call back to Sunil. Sunil?
Thank you, Marc. Next, I will provide you with our second quarter financial results. Net income for the quarter ended June 30, 2013 was approximately $5.1 million or about $0.06 per share compared to a net loss of approximately $1.7 million or about $0.03 per share for the comparable period in 2012.
The increase in net income was a result of an increase in net other income for the three-month period ended June 30, 2013 and this was approximately $5.4 million compared to about $15,000 for the comparable period in 2012. This increase was primarily related to approximately $5.4 million non-cash gain from decreases in the fair value of outstanding warrants Titan generated no grant or royalty revenue during the three months ended June 30, 2013.
Total operating expenses for the quarter ended June 30, 2013 were approximately $2.5 million compared with about $3.1 million for 2012, and consisted largely of research and development expenses of approximately $1.8 million compared to approximately $2 million for 2012. This small decrease in R&D costs was primarily associated with a decrease in external R&D expenses related to the review of the new drug application for Probuphine.
General and administrative expenses for the quarter were about $0.7 million compared to approximately $1.1 million for the comparable quarter in 2012. The decrease in G&A expenses was primarily related to decreases in non-cash stock compensation of about $0.1 million, consulting and professional fees decreased by about $0.3 million, and other administrative costs of approximately $0.1 million.
At June 30, 2013 Titan had approximately $11.2 million of cash compared to about $18.1 million at December 31, 2012. Titan believes that its working capital at June 30, 2013 is sufficient to fund planned operations through April of next year, that's April 2014.
The Titan team is fully engaged in supporting the ongoing efforts to address all of the issues identified by the FDA in the complete response letter and is working closely with Braeburn and the external experts to develop the required information. As Marc said, this is a methodical process that is nearing the stage where we expect to soon request a meeting with the FDA and we will keep you updated with our progress.
Thank you for participating in this call. We remain confident in our belief that Probuphine has the potential to be an important new treatment for opioid dependence and we truly appreciate your ongoing support. Have a great day. Thank you.
Ladies and gentlemen, again that does conclude today's conference. We do thank you all for your participation.
[No Q&A Session for this event].
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