Pharmos Corp. (Nasdaq: PARS) today published its financial report for the second quarter of 2007 and announced a restructuring plan.
Pharmos posted a net loss of $4.6 million ($0.18 per share) for the second quarter, 12% higher than the loss of $4.1 million ($0.21 per share) for the corresponding quarter of 2006. The company had $17.2 million in cash and short-term investments at the end of June.
Pharmos attributed most of the increase in its net loss to a 54% increase in gross research and development expenses to $3.7 million, as well as higher operating expenses, which were partially offset by a 46% cut in general and administrative expenses to $1.3 million.
The higher R&D expenses were driven by increased clinical trial-related activities. Costs in connection with Pharmos' leading clinical program, dextofisopam for irritable bowel syndrome (IBS), were $2.1 million for the quarter, including the start a Phase IIb study of the drug. Pharmos also began a Phase IIa trial in Israel of its topical NanoEmulsion drug delivery technology for the treatment of osteoarthritis.
Pharmos added that it was implementing a restructuring and cost reduction plan for its operations in Israel in an effort to continue its scientific research and development programs while better managing cash resources, which it expects will save $2 million a year. The company said that its Israeli operations after the cutbacks will include development of PRS-639,058, a compound currently in preclinical development for neuropathic pain; and completion of the NanoEmulsion Phase IIa clinical trial.
The company will cut its labor force in Israel from 41 persons to 23.
Published by Globes [online], Israel business news - www.globes.co.il - on August 8, 2007
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