RESEARCH TRIANGLE PARK, N.C., Aug. 3 /PRNewswire-FirstCall/ -- Aeolus Pharmaceuticals, Inc. (OTC Bulletin Board: AOLS.OB), the developer of a new class of catalytic antioxidant compounds targeting diseases and disorders of the central nervous system, respiratory system, autoimmune system, and oncology, announced today financial results for its third quarter of fiscal 2005, the three-month period ended June 30, 2005 . Aeolus reported a net loss of $1,636,000 , or $0.12 per share, for the three months ended June 30, 2005 , compared to a loss of $10,468,000 , or $0.81 per share, for the three months ended June 30, 2004 , a comparative decrease of 85%. For the nine months ended June 30, 2005 , the Company reported a net loss of $5,253,000 , or $0.38 per share, compared to a loss of $15,254,000 , or $2.23 per share, for the nine months ended June 30, 2004 , a comparative decrease of 83%.
'During the third quarter we completed the implementation of our plan to
streamline our operations and reduce our general and administrative expenses.
As such, our financial resources can now be focused on both our clinical
development program in ALS and our efforts to move several of our additional
compounds into the clinical development stage,' stated Richard P. Burgoon,
Jr., Chief Executive Officer of Aeolus.
During fiscal 2005, research and development expenses were significantly
lower than the same periods in fiscal 2004 as the Company shifted its
operational focus and research spending during the three and nine months ended
June 30, 2005 to conducting a Phase I study of AEOL 10150 for the possible
treatment of ALS. The primary operational focus for the Company, including
research spending during fiscal year 2004, was on preclinical pharmacology and
toxicology tests on AEOL 10150. Based on its proprietary rights to 200
compounds that have been developed over the previous ten years, the Company
decided to eliminate its research staff in 2004 and to utilize outside
organizations to conduct late stage pre-clinical studies of its compounds.
General and administrative expenses have been significantly lower so far in fiscal 2005 compared to fiscal 2004 as a result of the Company's restructuring efforts. For the quarter ended June 30, 2005 , general and administrative expenses were $898,000 , a reduction of approximately $1.5 million from the same period the prior year. Earnings for the three and nine months ended June 30, 2005 included $490,000 of non-recurring charges related to the discontinuation of the employment contract with Aeolus' former Chief Financial Officer.
As of June 30, 2005 , the Company had $2,027,000 in cash and cash equivalents and 13,976,000 shares outstanding. On June 27, 2005 , the Company announced a $2.5 million financing commitment from existing shareholders. The funds raised are expected to be used almost exclusively for development of the Company's lead drug candidate AEOL 10150 and selected compounds under the Aeolus Pipeline Initiative.
About Aeolus Pharmaceuticals
Aeolus is developing a variety of therapeutic agents based on its proprietary small molecule catalytic antioxidants, with AEOL 10150 being the first to enter human clinical evaluation. AEOL 10150 is a small molecule catalytic antioxidant that has shown the ability to scavenge a broad range of reactive oxygen species. As a catalytic antioxidant, AEOL 10150 mimics and thereby amplifies the body's natural enzymatic systems for eliminating these damaging compounds. Because oxygen-derived free radicals are believed to have an important role in the pathogenesis of many diseases, Aeolus' antioxidant enzyme-mimetic drugs are believed to have a broad range of potential therapeutic uses. In particular, Aeolus' catalytic antioxidants have been shown to significantly reduce tissue damage in animal models of ALS, stroke, chronic obstructive pulmonary disease, and mucositis caused by radiation therapy. The Aeolus Pipeline Initiative is an internal development initiative focused on advancing several of the most promising catalytic antioxidant compounds from Aeolus' proprietary library of 200 compounds. The initial therapeutic focus areas for the Aeolus Pipeline Initiative are: Parkinson's disease; Autoimmune disorders (arthritis and ulcerative colitis); Chronic Obstructive Lung Disease; Biodefense/Radioprotection; Tumor Suppression/Bone Marrow Transplantation; and Stroke. These therapeutic focus areas were selected based upon preliminary data developed using Aeolus catalytic antioxidant compounds.
The statements in this press release that are not purely statements of historical fact are forward-looking statements. Such statements include, but are not limited to, those relating to Aeolus' product candidates, as well as its proprietary technologies and research programs. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause Aeolus' actual results to be materially different from historical results or from any results expressed or implied by such forward- looking statements. Important factors that could cause results to differ include risks associated with uncertainties of progress and timing of clinical trials, scientific research, and product development activities, difficulties or delays in development, testing, obtaining regulatory approval, the need to obtain funding for pre-clinical and clinical trials and operations, the scope and validity of intellectual property protection for Aeolus' product candidates, proprietary technologies and their uses, and competition from other biopharmaceutical companies. Certain of these factors and others are more fully described in Aeolus' filings with the Securities and Exchange Commission, including, but not limited to, Aeolus' Quarterly Report on Form 10-Q for the quarter ended June 30, 2005 . Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof.
AEOLUS PHARMACEUTICALS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share data)
Three Months Ended Nine Months Ended
June 30, June 30,
2005 2004 2005 2004
Revenue
Grant income $121 $72 $236 $174
Costs and expenses:
Research and development 849 3,147 3,621 6,744
General and administrative 898 2,381 1,851 3,438
Total costs and expenses 1,747 5,528 5,472 10,182
Loss from operations (1,626) (5,456) (5,236) (10,008)
Interest expense, net (10) (5,012) (17) (5,111)
Net loss (1,636) (10,468) (5,253) (15,119)
Preferred stock dividend accreted - - - (135)
Net loss attributable to common
stockholders $(1,636) $(10,468) $(5,253) $(15,254)
Net loss per weighted share
attributable to common
stockholders:
Basic and diluted $(0.12) $(0.81) $(0.38) $(2.23)
Weighted average common shares
outstanding:
Basic and diluted 13,976 12,877 13,966 6,830
Selected Balance Sheet Items:
(in thousands)
June 30, 2005 September 30, 2004
(Unaudited)
Cash and marketable securities $2,027 $7,381
Total assets $2,554 $7,856
Stockholders' equity $608 $5,532
SOURCE Aeolus Pharmaceuticals, Inc.
