Cipher reports second quarter fiscal 2008 results
Toronto Stock Exchange Symbol: DND
MISSISSAUGA, ON, Aug. 13 /CNW/ - Cipher Pharmaceuticals Inc. (TSX: DND)
today announced its financial and operational results for the three and six
months ended June 30, 2008.
Q2 2008 Summary
---------------
- Submitted revised New Drug Application (NDA) to the U.S. Food and
Drug Administration (FDA) for CIP-TRAMADOL ER, extended-release
tramadol formulation; NDA subsequently accepted for review by FDA
- Recorded licensing revenue of $277,000 from Lipofen(R)
- Net loss decreased to $1.8 million, or $0.08 per share, compared with
$2.1 million, or $0.09 per share, in the second quarter of 2007
- Cash of $9.9 million at quarter end, compared with $11.0 million at
the end of fiscal 2007
- Subsequent to quarter end, entered into a definitive development,
distribution and supply agreement with Ranbaxy Pharmaceuticals Inc.
("RPI"), for CIP-ISOTRETINOIN in the United States.
"A key product development highlight during the quarter was the
submission of our revised NDA for extended-release tramadol, which we believe
provides the most expeditious path to final regulatory approval," said Larry
Andrews, President and CEO of Cipher. "We also achieved a major milestone
recently with the completion of the agreement with Ranbaxy for
CIP-ISOTRETINOIN. This agreement provides us with the financial resources to
complete CIP-ISOTRETINOIN's clinical development program while also achieving
attractive commercialization terms post-FDA approval. Sales of Lipofen, our
first commercial product, grew solidly during the quarter and we expect this
product to provide a steadily increasing revenue stream to offset some of our
operating costs and support our continued growth."
Financial Review
----------------
In Q2 2008, Cipher recorded total revenue of $277,000, an increase of 22%
over the same period last year. Research and development expenses increased
from $0.8 million in Q2 2007 to $1.1 million in Q2 2008, as a result of
completion of additional pharmacokinetic studies for CIP-TRAMADOL ER during Q2
2008. Operating, general and administrative (OG&A) expenses for Q2 2008 were
$1.0 million, compared with $1.4 million in Q2 2007. The year-over-year
decrease reflects certain non-recurring expenses incurred in Q2 2007 related
to the move to new premises and the departure of a senior employee. OG&A
expenses are expected to increase moderately over the balance of the year as
select resources are added to the management team. Net loss for the three
months ended June 30, 2008 was $1.8 million ($0.08 per basic and diluted
share), compared with a net loss of $2.1 million ($0.09 per basic and diluted
share) in the same period last year.
As at June 30, 2008, Cipher had cash of $9.9 million, compared with
$11.0 million at December 31, 2007.
Drug Development Update
-----------------------
In July 2007, Cipher entered into a licensing and distribution agreement
with ProEthic Pharmaceuticals under which ProEthic was granted the exclusive
right to market, sell and distribute Lipofen in the United States. In late
September 2007, ProEthic launched Lipofen in the U.S. market with the full
effort of its sales and marketing teams. Since launch, weekly prescriptions
have shown steady growth and Cipher expects this trend to continue as ProEthic
increases penetration of the primary care physicians in its targeted regions
and expands its sales force. Subsequent to quarter end, ProEthic was acquired
by Kowa Company Ltd. ("Kowa"), a multinational Japanese company actively
engaged in manufacturing and trading activities in various fields, including
pharmaceuticals and life sciences. Kowa has indicated that it is committed to
supporting Lipofen and will accelerate the planned expansion of ProEthic's
sales force, particularly in regions where ProEthic does not have coverage
currently. Effective September 1, 2008, ProEthic will change its name to Kowa
Pharmaceuticals America.
During the second quarter of 2007, Cipher received a second approvable
letter from the FDA pertaining to its CIP-ISOTRETINOIN NDA. In the letter, the
FDA indicated that Cipher's application is approvable subject to the
resolution of two remaining issues. In addition to one question related to
chemistry, manufacturing and controls, which the Company responded to, the FDA
requested that Cipher provide additional clinical safety data. The Company
appealed the position taken by the FDA in its approvable letter using the
formal dispute resolution process. After subsequent discussions, the
representative from the FDA agreed with the Division of Dermatology and Dental
Product's original view that a Phase III safety study was needed to further
demonstrate the safety of CIP-ISOTRETINOIN. Cipher and its advisors are
currently in discussions with the Division regarding the appropriate design of
a safety trial. The study protocol has been submitted for FDA review under a
Special Protocol Assessment ("SPA").
Subsequent to quarter end, the Company entered into a definitive
development, distribution and supply agreement with Ranbaxy Pharmaceuticals
Inc. ("RPI"), a wholly owned subsidiary of Ranbaxy Laboratories Limited, under
which Cipher has granted RPI the exclusive right to market, sell and
distribute CIP-ISOTRETINOIN in the United States. Under the terms of the
agreement with RPI, Cipher received an initial upfront milestone payment of
US$1 million. The agreement includes additional pre- and
post-commercialization milestone payments of up to US$23 million, contingent
upon the achievement of certain milestone targets. Once the product is
successfully commercialized, Cipher will also receive a royalty in the
mid-teens on net sales. In addition, RPI will reimburse Cipher for all costs
associated with any remaining clinical studies required to obtain FDA
approval, up to a predetermined cap. Any additional development costs
associated with initial FDA approval will be shared equally. Cipher is
responsible for all product development activities, including management of
the clinical studies required by the FDA to secure NDA approval. Cipher is
also responsible for product supply and manufacturing, which would be
fulfilled by its partner, Galephar Pharmaceutical Research. After
product-related expenses are deducted, approximately 50% of all milestone and
royalty payments received by Cipher under the agreement will be paid to
Galephar.
In May 2007, Cipher received an approvable letter from the FDA pertaining
to its NDA for CIP-TRAMADOL ER, the Company's extended-release formulation of
tramadol. In its letter, the FDA indicated that Cipher's application is
approvable subject to the resolution of certain issues, including a request
for an additional adequate clinical trial to provide further efficacy data. In
subsequent discussions, the FDA indicated that the statistical methods used to
analyze data from Cipher's clinical trials did not adequately address missing
data relating to subjects who dropped out of the trials. In December 2007,
Cipher announced that it had appealed the position taken by the FDA using the
FDA's formal dispute resolution process. In the written response, the Acting
Director of the Office of Drug Evaluation II, Center for Drug Evaluation and
Research supported the original approvable action. In a subsequent discussion,
the FDA suggested an additional statistical sensitivity analysis of existing
clinical data on CIP-TRAMADOL ER as a means to potentially satisfy the
requirements for approval. As a consequence, the Company suspended its appeal
and conducted the additional statistical analysis. During the second quarter
of 2008, Cipher submitted a revised NDA to the FDA. After considering feedback
from the FDA appeal process and the results of the additional statistical
sensitivity analysis, Cipher and its advisors concluded that submitting the
revised NDA provided the most expeditious path to final regulatory approval.
Cipher's revised NDA includes data from additional pharmacokinetic studies
conducted by the Company comparing CIP-TRAMADOL ER to Ultram(R) ER. The
revised NDA was accepted for review, which the Company expects to be completed
by October 2008. It is possible that the submission could trigger patent
infringement litigation and a stay of up to 30 months under the Hatch-Waxman
Act. Out-licensing discussions with potential commercial partners are ongoing.
Notice of Conference Call
-------------------------
Cipher will hold a conference call today, August 13, 2008, at 8:30 a.m.
(ET) to discuss its financial results and other corporate developments. To
access the conference call by telephone, dial 416-644-3431 or 1-800-814-4860.
A live audio webcast of the call will be available at www.cipherpharma.com.
The webcast will be archived for 90 days.
About Cipher Pharmaceuticals Inc.
Cipher Pharmaceuticals is a drug development company focused on
commercializing novel formulations of successful, currently marketed molecules
using advanced drug delivery technologies. Cipher's strategy is to in-license
products that incorporate proven drug delivery technologies and advance them
through the clinical development and regulatory approval stages, after which
the products are out-licensed to international partners. Because Cipher's
products are based on proven technology platforms applied to currently
marketed drugs, they are expected to have lower approval risk, shorter
development timelines and significantly lower development costs. The Company's
lead compound, CIP-FENOFIBRATE, received final approval from the U.S. Food and
Drug Administration and Health Canada in the first quarter of 2006. The
product is being marketed in the United States by ProEthic Pharmaceuticals
under the label Lipofen(R). In addition, Cipher is developing formulations of
the pain reliever tramadol (FDA approvable letter in May 2007) and the acne
treatment isotretinoin (FDA approvable letter in April 2007).
Cipher is listed on the Toronto Stock Exchange under the symbol 'DND' and
has approximately 24 million shares outstanding. For more information, please
visit www.cipherpharma.com.
Forward-Looking Statements
Statements made in this news release, other than those concerning
historical financial information, may be forward-looking and therefore subject
to various risks and uncertainties. Some forward-looking statements may be
identified by words like "may", "will", "anticipate", "estimate", "expect",
"intend", or "continue" or the negative thereof or similar variations. Certain
material factors or assumptions are applied in making forward-looking
statements and actual results may differ materially from those expressed or
implied in such statements. Factors that could cause results to vary include
those identified in the Company's Annual Information Form and other filings
with Canadian securities regulatory authorities, such as the applicability of
patents and proprietary technology; possible patent litigation; regulatory
approval of products in the Company's pipeline; changes in government
regulation or regulatory approval processes; government and third-party payer
reimbursement; dependence on strategic partnerships for product candidates and
technologies, marketing and R&D services; meeting projected drug development
timelines and goals; intensifying competition; rapid technological change in
the pharmaceutical industry; anticipated future losses; the ability to access
capital to fund R&D; and the ability to attract and retain key personnel. All
forward-looking statements presented herein should be considered in
conjunction with such filings. Except as required by Canadian securities laws,
the Company does not undertake to update any forward-looking statements; such
statements speak only as of the date made.
Cipher Pharmaceuticals Inc.
Unaudited Consolidated Balance Sheets
(in thousands of dollars)
As at
June 30, December 31,
2008 2007
ASSETS
Current assets
Cash $ 9,851 $ 10,961
Accounts receivable 182 1,396
Income taxes receivable 22 128
Prepaid expenses and other current assets 93 56
Current portion of loan receivable (note 4) 655 -
10,803 12,541
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Property and equipment, net 176 208
Loan receivable (note 4) 684 1,377
Intangible assets, net (note 5) 4,359 4,592
-------------------------------------------------------------------------
-------------------------------------------------------------------------
$ 16,022 $ 18,718
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LIABILITIES
Current liabilities
Accounts payable and accrued liabilities $ 1,121 $ 1,059
Deferred revenue 935 790
-------------------------------------------------------------------------
2,056 1,849
Deferred revenue 894 1,192
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2,950 3,041
-------------------------------------------------------------------------
SHAREHOLDERS' EQUITY
Share capital (note 6) 49,948 49,948
Contributed surplus 31,310 31,032
Deficit (68,186) (65,303)
-------------------------------------------------------------------------
13,072 15,677
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
$ 16,022 $ 18,718
-------------------------------------------------------------------------
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The accompanying notes are an integral part of these consolidated
financial statements
Cipher Pharmaceuticals Inc.
Unaudited Consolidated Statements of Operations and Comprehensive Loss
(in thousands of dollars, except per share amounts)
For the three For the six
months ended months ended
June 30 June 30
2008 2007 2008 2007
Revenues
Licensing revenue $ 277 $ - $ 454 $ -
Product sales - 227 - 227
-------------------------------------------------------------------------
277 227 454 227
-------------------------------------------------------------------------
Expenses
Cost of goods sold - 177 - 177
Research and development 1,092 826 1,542 1,670
Operating, general and
administrative 967 1,354 1,778 2,271
Amortization of property
and equipment 18 11 35 16
Amortization of intangible
assets 116 117 233 233
Interest income (113) (180) (251) (367)
-------------------------------------------------------------------------
2,080 2,305 3,337 4,000
-------------------------------------------------------------------------
Loss and comprehensive loss
for the period $(1,803) $(2,078) $(2,883) $(3,773)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Basic and diluted loss per
share (note 7) $ (0.08) $ (0.09) $ (0.12) $ (0.16)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
The accompanying notes are an integral part of these unaudited
consolidated financial statements
Cipher Pharmaceuticals Inc.
Unaudited Consolidated Statements of Deficit
(in thousands of dollars)
For the three For the six
months ended months ended
June 30 June 30
2008 2007 2008 2007
Deficit, beginning
of period $ (66,383) $ (60,553) $ (65,303) $ (58,858)
Loss for the period (1,803) (2,078) (2,883) (3,773)
-------------------------------------------------------------------------
Deficit, end
of period $ (68,186) $ (62,631) $ (68,186) $ (62,631)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
The accompanying notes are an integral part of these unaudited
consolidated financial statements
Cipher Pharmaceuticals Inc.
Unaudited Consolidated Statements of Cash Flows
(in thousands of dollars)
For the three For the six
months ended months ended
June 30 June 30
2008 2007 2008 2007
Cash provided by (used in)
Operating activities
Loss $ (1,803) $ (2,078) $ (2,883) $ (3,773)
Items not
affecting cash
Amortization
of property
and equipment 18 11 35 16
Amortization
of intangible
assets 116 117 233 233
Stock-based
compensation
expense 161 144 278 303
Imputed interest
(note 4) (32) (46) (73) (100)
-------------------------------------------------------------------------
(1,540) (1,852) (2,410) (3,321)
Net change in
non-cash
operating items 1,013 266 1,192 (274)
Drawdown of loan
receivable
(note 4) 111 223 111 800
-------------------------------------------------------------------------
(416) (1,363) (1,107) (2,795)
-------------------------------------------------------------------------
Investing activities
Purchase of
property and
equipment (3) (127) (3) (133)
-------------------------------------------------------------------------
Decrease in cash (419) (1,490) (1,110) (2,928)
Cash, beginning
of period 10,270 13,639 10,961 15,077
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Cash, end
of period $ 9,851 $ 12,149 $ 9,851 $ 12,149
-------------------------------------------------------------------------
-------------------------------------------------------------------------
The accompanying notes are an integral part of these unaudited
consolidated financial statements
Cipher Pharmaceuticals Inc.
Notes to Unaudited Consolidated Financial Statements
June 30, 2008
(in thousands of dollars, except per share amounts)
1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of presentation
The accompanying unaudited interim consolidated financial statements
of the Company have been prepared in accordance with accounting
principles generally accepted in Canada for interim reporting.
Accordingly, these financial statements do not include all of the
disclosures required by generally accepted accounting principles for
annual financial statements and should be read in conjunction with
the annual financial statements of the Company. In the opinion of
management, all adjustments considered necessary for fair
presentation have been included. All such adjustments are of a normal
recurring nature. Operating results for the six months ended June 30,
2008 are not necessarily indicative of the results that may be
expected for the fiscal year ending December 31, 2008.
There have been no changes to the accounting policies as described in
Note 1 and Note 2 to the consolidated financial statements for the
year ended December 31, 2007, except as explained in Note 2 below.
Basis of consolidation
These consolidated financial statements include the accounts of
Cipher Pharmaceuticals Inc. (the "Company") and its subsidiaries. All
intercompany balances with subsidiaries have been eliminated. As part
of the simplification of its corporate structure, the Company's
wholly-owned subsidiaries Cipher Canada Inc., Cipher Holdings
(Barbados) Ltd. and Cipher Pharmaceuticals Ltd. are in the process of
being wound up by way of voluntary dissolution.
2 ADOPTION OF NEW ACCOUNTING POLICIES
Effective January 1, 2008 the Company adopted the following new CICA
accounting standards: Section 3862, Financial Instruments -
Disclosures and Section 1535, Capital Disclosures.
CICA Section 3862, Financial Instruments - Disclosures, establishes
standards for the disclosure of financial instruments including
disclosing the significance of financial instruments and the nature
and extent of risks arising from financial instruments.
CICA Section 1535, Capital Disclosures, establishes standards for
disclosing aspects of the entity's capital management strategy. This
standard requires disclosure of both quantitative and qualitative
disclosures around the entity's objectives, policies and processes
for managing capital requirements and the consequences of non-
compliance.
The adoption of these new standards had no impact on the Company's
financial position or results of operations.
3 RISK MANAGEMENT
Financial risk management
In the normal course of business, the Company is exposed to a number
of financial risks that can affect its operating performance. These
risks are: credit risk, liquidity risk and market risk. The Company's
overall risk management program and prudent business practices seek
to minimize any potential adverse affects on the Company's financial
performance.
(i) Credit risk
Cash - the Company places its cash with Canadian Schedule I banks.
Accounts receivable - the Company licenses its products to
distribution partners in major markets. The credit risk associated
with the accounts receivable pursuant to these agreements is
evaluated during initial negotiations and on an ongoing basis. There
have been no events of default under these agreements. As of June 30,
2008, no accounts receivable balances were considered impaired, nor
past due.
Loan receivable - the loan receivable is payable in annual
instalments over a five year period, with two payments remaining as
at June 30, 2008. All prior instalments have been received on
schedule and there have been no events of default under the loan
agreement.
(ii) Liquidity risk
The Company has no long term debt with specified repayment terms.
Accounts payable and accrued liabilities are settled in the regular
course of business, based on negotiated terms with trade suppliers.
All components of the balance of $1,121 as at June 30, 2008 will be
settled in less than one year. The carrying value of the balances
approximate their fair value as the impact of discounting is not
significant.
(iii) Market risk
Currency risk - the majority of the Company's revenue and a portion
of its expenses are denominated in US currency. At June 30, 2008 the
accounts receivable balance included a total of US$132 and accounts
payable and accrued liabilities included a total of US$223. There is
no active hedging program currently in place due to the relatively
short time frame for settlement of these balances. A 10% change in
the US/CDN exchange rate on the June 30, 2008 balances would not have
a significant impact on net income.
Interest rate risk - the fair value of the loan receivable is based
upon a discounted cash flow method, whereby a risk premium is added
to the Bank of Canada risk-free interest rate. A 10% change in the
risk-free interest rate would not have a significant impact on
imputed interest.
Capital risk management
Shareholders' equity is managed as the capital of the Company. The
Company's objective when managing capital is to safeguard the
Company's ability to continue as a going concern in order to provide
returns for shareholders and to maintain an optimal capital structure
to minimize the cost of capital. In order to maintain or adjust the
capital structure, the Company may issue new common shares from time
to time.
4 LOAN RECEIVABLE
On February 28, 2005, the Company completed the sale of its wholly-
owned pharmaceutical research services business, Pharma Medica
Research Inc. (Pharma Medica). Consideration consisted of a cash
payment of $14,000 and a deferred payment of $4,000. The deferred
payment is non-interest bearing and is repayable in annual
instalments of $800 over a five year period. As the deferred payment
is non-interest bearing, it was recorded at its fair value of $3,112
based on a discount rate of 9%. Imputed interest of $73 has been
recorded on this deferred payment during the six months ended
June 30, 2008 ($100 during the six months ended June 30, 2007). In
accordance with the terms of the deferred payment agreement, $800 of
clinical services purchased from Pharma Medica during 2007 were
offset against the annual payment that was due on January 30, 2008.
During the six months ended June 30, 2008, $111 of clinical services
purchased from Pharma Medica were offset against the next annual
payment, which is due on January 30, 2009.
5 INTANGIBLE ASSETS
During fiscal 2001, the Company entered into certain agreements with
Galephar Pharmaceutical Research Inc. ("Galephar") for the rights to
package, test, obtain regulatory approvals and market certain
products in various countries around the world. In accordance with
the terms of the agreements, the Company has acquired these
intangible rights through an investment in three separate series of
preferred shares of Galephar. The Company may be required to pay
additional amounts to Galephar in respect of the CIP-ISOTRETINOIN and
CIP-TRAMADOL ER intangible rights of up to $1,528 (US$1,500) if
certain future milestones are achieved as defined in the agreements.
These additional payments will be made in the form of additional
Galephar preferred share purchases. The recoverability of these
intangible rights is dependant upon sufficient revenues being
generated from the related products currently under development and
commercialization.
Upon receipt of FDA approval in January 2006, the Company began
amortizing the intangible rights related to CIP-FENOFIBRATE.
Currently, no other products have received FDA approval.
With regard to CIP-FENOFIBRATE, in July 2007 the Company entered into
a licensing and distribution agreement with ProEthic Pharmaceuticals,
Inc. ("ProEthic") under which ProEthic was granted the exclusive
right to market, sell and distribute Lipofen in the United States.
The Company has received an up-front licensing fee of US$2 million.
In addition, under the terms of the agreement, the Company could
receive additional milestone payments of up to US$20 million based on
the achievement of certain net sales targets. The Company also
receives a royalty based on a percentage of net sales. These elements
are reflected in licensing revenue, which also incorporates direct
product-related expenses and amounts due to Galephar, the Company's
technology partner. Revenue from licensing and distribution
agreements is presented on a net basis. Over the term of the Galephar
agreement, after product-related expenses are deducted and including
payments to Galephar, the Company anticipates that it will retain
approximately 50% of revenue. In late September 2007, ProEthic
launched Lipofen in the U.S. market.
The Company's US$2 million investment in Galephar preferred shares
related to CIP-FENOFIBRATE is being repaid by Galephar in a series of
quarterly payments. The first payment of US$350 was received in
December 2007. Subsequent to year-end, the repayment schedule was
amended and payments of US$225 were received in March and June 2008.
The next quarterly payment will be in the amount of US$225. These
payments are included in revenue based on the remaining amortization
period of the related intangible asset.
On August 6, 2008, the Company entered into a distribution and supply
agreement with Ranbaxy Pharmaceuticals Inc. ("RPI") under which RPI
was granted the exclusive right to market, sell and distribute CIP-
ISOTRETINOIN in the United States. Under the terms of the agreement,
the Company will receive an up-front milestone payment of
US$1 million and could receive additional pre- and post-
commercialization milestone payments of up to US$23 million, based on
the achievement of certain milestone targets. Once the product is
successfully commercialized, the Company will also receive a royalty
based on a percentage of net sales. In addition, RPI will reimburse
the Company for all costs associated with the clinical studies
required by the FDA to secure NDA approval, up to a predetermined
cap. Any additional development costs associated with initial FDA
approval will be shared equally. The Company is responsible for all
product development activities, including management of the clinical
studies required by the FDA to secure NDA approval and is also
responsible for product supply and manufacturing, which will be
fulfilled by Galephar. After product-related expenses are deducted,
approximately 50% of all milestone and royalty payments received by
the Company under the agreement will be paid to Galephar.
6 SHARE CAPITAL
Authorized share capital
The authorized share capital consists of an unlimited number of
preference shares, issuable in series, and an unlimited number of
voting common shares.
Issued share capital
The following is a summary of the changes in share capital from
December 31, 2006 to June 30, 2008:
Number of
common shares Amount
(in thousands) $
Balance outstanding - December 31, 2006 24,036 49,891
Options exercised during 2007 19 57
------------------------
Balance outstanding - December 31, 2007
and June 30, 2008 24,055 49,948
------------------------
------------------------
During 2007, 19,277 shares were issued as a result of the exercise of
37,500 options. The Company's stock option plan provides that an
option holder may elect to receive an amount of shares equivalent to
the growth value of vested options, which is the difference between
the market price and the exercise price of the options. There is no
cash consideration for the shares issued when this election is chosen
by an option holder.
Stock option plan
The following is a summary of the changes in the stock options
outstanding from December 31, 2006 to June 30, 2008:
Weighted
average
Number of exercise
options price
(in thousands) $
Balance outstanding - December 31, 2006 889 2.96
Options granted during 2007 274 3.90
Options exercised during 2007 (38) 1.90
Options cancelled during 2007 (127) 2.16
---------------
Balance outstanding - December 31, 2007 998 3.36
Options granted during the three months
ended March 31, 2008 263 1.05
Options cancelled during the three months
ended March 31, 2008 (50) 3.90
---------------
Balance outstanding - June 30, 2008 1,211 2.83
---------------
---------------
At June 30, 2008, 545,482 options were fully vested and exercisable.
During the three months ended March 31, 2008, the Company issued
263,000 stock options under the employee and director stock option
plan, which have an exercise price of $1.05, 25% of which vest on
February 28 of each year, commencing in 2009, and expire in 2018.
Total compensation cost for these stock options is estimated to be
$242. This cost will be recognized over the vesting period of the
stock options.
The stock options issued during the three months ended March 31, 2008
were valued using the Black-Scholes option pricing model with the
following assumptions:
Risk-free interest rate 3.14%
Expected life 10 years
Expected volatility 93%
Expected dividend Nil
7 LOSS PER SHARE
Loss per share is calculated using the weighted average number of
shares outstanding. The weighted average number of shares outstanding
for the six and three month periods ended June 30, 2008 was
24,054,878 (for the six and three month periods ended June 30, 2007
respectively 24,043,376 and 24,051,065).
As the Company had a loss for each of the periods presented, basic
and diluted loss per share are the same because the exercise of all
stock options would have an anti-dilutive effect.
8 COMPARATIVE FIGURES
Certain comparative figures for the previous year have been
reclassified to conform to current financial statement presentation.
%SEDAR: 00020415E
For further information: Craig Armitage, Investor Relations, The Equicom
Group, (416) 815-0700 ext 278, (416) 815-0080 fax, carmitage@equicomgroup.com;
Larry Andrews, President and CEO, Cipher Pharmaceuticals, (905) 602-5840 ext
324, fax (905) 602-0628 fax, landrews@cipherpharma.com
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