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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): April 27, 2004
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A.P. PHARMA, INC.
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(Exact name of Registrant as specified in its charter)
DELAWARE 1-16109 94-2875566
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
123 SAGINAW DRIVE, REDWOOD CITY, CALIFORNIA 94063
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code:
(650) 366-2626
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N/A
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(Former Name or Former Address, if Changed Since Last Report)
INFORMATION TO BE INCLUDED IN THE REPORT
ITEM 7. Financial Statements, Pro Forma Financial Information
and Exhibits.
(c) Exhibits
99.1 Press release dated April 28, 2004.
ITEM 12. Results of Operations and Financial Condition.
The following information is disclosed pursuant to Item 12 of
Form 8-K:
On April 28, 2004, the Registrant issued a press release
announcing its financial results for the fiscal quarter ended
March 31, 2004. The press release is attached hereto as Exhibit
99.1 and incorporated herein by reference.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
A.P. PHARMA, INC.
Date: April 28, 2004 By: /S/ Michael O'Connell
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Michael P. J. O'Connell,
President and Chief
Executive Officer
EXHIBIT INDEX
99.1 Press release dated April 28, 2004.
(continued from previous page)
Exhibit 99.1
A.P. Pharma Logo
News Release
A.P. PHARMA REPORTS FIRST QUARTER RESULTS
- Human clinical trials underway with two product candidates -
REDWOOD CITY, Calif. (April 28, 2004) - A.P. Pharma, Inc.
(NASDAQ NM: APPA), a specialty pharmaceutical company, today
reported financial results for the three months ended March 31,
2004.
Current and Financial Highlights
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* A Phase 2 human clinical trial is ongoing with APF112 for the
treatment of post-surgical pain.
* Pre-clinical studies with APF530 for the treatment of
chemotherapy-induced nausea and vomiting (CINV) are completed.
* A Phase 1 human clinical trial is underway in the U.K. with
APF530 for the treatment of CINV.
* First quarter 2004 royalty income increased by 12% to $1.2
million, reflecting sales growth in both Retin-A Micro(R) and
Carac(TM).
* A study conducted at MIT indicating a Biochronomer(TM)
formulation could advance DNA vaccine usage against viral
infections and cancers was reported in the February 2004 issue
of Nature Materials.
* Net cash burn for the first quarter of 2004 was $1.7 million.
* Cash, cash equivalents and short-term investments were $7.7
million at March 31, 2004.
Financial Results
- -----------------
The Company reported royalties for the first quarter of 2004 of
$1,154,000, compared with $1,032,000 for the first quarter of
2003. Royalties on sales of Retin-A Micro grew by 16% over the
first quarter of 2003 and royalties on sales of Carac grew by 4%
over the first quarter of 2003. Total revenues for the first
quarter of 2004 increased 7% to $1,180,000 compared with
$1,106,000 in the comparable year-ago period. Royalties
represented 98% of total revenues in the first quarter of 2004,
compared with 93% of total revenues in the first quarter of
2003.
Research and development expense for the first quarter of 2004
increased by $833,000 or 38% to $3,035,000, reflecting the costs
of clinical and pre-clinical studies on two product candidates
incorporating the Company's proprietary Biochronomer bioerodible
drug delivery system.
Part 2 of the Phase 2 human clinical study using APF112 for the
treatment of post-surgical pain is ongoing. The product is
designed to provide pain relief for a sustained period of time
following surgery, and to reduce or eliminate the need for
opioid-like products. APF112 contains the local anesthetic
mepivacaine and has been shown in Part 1 of the Phase 2 clinical
study to sustain blood drug levels for up to 72 hours. Wound
healing in all patients was observed to be normal and no adverse
events were reported. The second part of the Phase 2 trial is a
90-patient blinded study comparing two doses of APF112 with
current standard treatments for post-surgical pain. The end
points for the trial include a visual analog score of pain
intensity, the standard means of measuring pain, and reduction
in use of opioid-type medication by patients.
The Company also completed pre-clinical studies and has
initiated a Phase 1 human clinical trial in the U.K. using
APF530 for the treatment of chemotherapy-induced nausea and
vomiting. APF530 contains the anti-emetic granisetron, and is
designed to provide three to five days of continuous relief from
chemotherapy-induced nausea and vomiting following a single
subcutaneous injection.
The loss from continuing operations in the first quarter of 2004
was $2,550,000, compared with a loss from continuing operations
in the first quarter of 2003 of $1,798,000. The gain on
disposition of discontinued operations in the first quarter of
2003 represents the net gain on the sale of the Company's
Analytical Standards division.
Conference Call Information
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Management will be hosting an investment community conference
call beginning at 11:00 a.m. Eastern Time (8:00 a.m. Pacific
Time) today, April 28, 2004, to discuss this announcement and to
answer questions.
To participate in the live call by telephone, please dial (888)
803-8275 from the U.S., or (706) 634-1287 from outside the U.S.
A telephone replay will be available for 48 hours by dialing
(800) 642-1687 from the U.S., or (706) 645-9291 from outside the
U.S., and entering reservation number 6968039.
Individuals interested in listening to the conference call via
the Internet may do so by visiting www.appharma.com. A replay
will be available on the Company's Web site for 30 days.
About A.P. Pharma
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A.P. Pharma is a specialty pharmaceutical company focused on the
development of ethical (prescription) pharmaceuticals utilizing
its proprietary polymer-based drug delivery systems. The
Company's primary focus is the development and commercialization
of its bioerodible injectable and implantable systems under the
trade name Biochronomer. Initial target areas of application
for the Company's drug delivery technology include pain
management, anti-nausea, inflammation, oncology and
ophthalmology applications. The Company's product development
programs are funded by royalties from topical products currently
marketed by pharmaceutical partners, by proceeds from the
divestitures of its cosmeceutical and analytical standards
product lines and by fees it receives from collaborative
partners. For further information visit the Company's Web site
at www.appharma.com.
Forward-looking Statements
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Except for historical information, this news release contains
certain forward-looking statements that involve risks and
uncertainties including, among others, uncertainty associated
with timely development, approval, launch and acceptance of new
products, establishment of new corporate alliances and progress
in research and development programs. Other risks and
uncertainties associated with the Company's business and
prospects are identified in the Company's filings with the
Securities and Exchange Commission. The Company does not
undertake to revise these forward-looking statements to reflect
events or circumstances occurring in the future.
Investor Relations Contacts: Company Contact:
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Lippert/Heilshorn & Associates Gordon Sangster
Zachary Bryant (zbryant@lhai.com) Chief Financial Officer
Jody Cain (jcain@lhai.com) (650) 366-2626
Bruce Voss (bvoss@lhai.com)
(310) 691-7100
(Financial tables follow)
A.P. PHARMA, INC.
Income Statement Highlights
(in thousands, except per share data)
(Unaudited)
Three Months Ended
March 31, March 31,
2004 2003
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Royalties $ 1,154 $ 1,032
Contract Revenues 26 74
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Total Revenues 1,180 1,106
Operating Expenses:
Research & Development 3,035 2,202
General & Administrative 724 778
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Total Operating Expenses 3,759 2,980
Operating Loss (2,579) (1,874)
Interest and Other, Net 29 76
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Loss from Continuing Operations (2,550) (1,798)
Loss from Discontinued Operations (50) (54)
Gain on Disposition of
Discontinued Operations 1 1,886
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Net Income (Loss) $(2,599) $ 34
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Basic and Diluted Earnings (Loss)
Per Share:
Loss from Continuing Operations $ (0.12) $ (0.09)
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Net Income (Loss) $ (0.13) $ 0.00
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Shares used in Calculating
Earnings (Loss) Per Share:
Basic 20,653 20,475
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Diluted 20,653 20,516
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A.P. PHARMA, INC.
Balance Sheet Highlights
(in thousands)
March 31, 2004
(Unaudited) December 31, 2003
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Assets
Cash, Cash Equivalents and
Marketable Securities $ 7,744 $ 9,484
Accounts Receivable, Net 1,466 1,340
Other Current Assets 421 434
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Total Current Assets 9,631 11,258
Property, Plant & Equipment, Net 1,349 1,430
Other Non-Current Assets 287 467
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Total Assets $11,267 $13,155
Liabilities and Stockholders'
Equity
Current Liabilities $ 2,519 $ 1,892
Stockholders' Equity 8,748 11,263
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Total Liabilities and
Stockholders' Equity $11,267 $13,155
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