Ore Pharmaceuticals Inc (ORXE) filed Quarterly Report for the period ended 2009-03-31.
Gene Logic Inc. is now ORE PHARMACEUTICALS INC. With their new name comes a focused commitment to drug repositioning and development. Headquartered in Gaithersburg Maryland the Company?s indication discovery technologies are currently applied at its facilities in Cambridge Massachusetts on behalf of a number of top pharmaceutical companies. These companies have provided compounds which have failed advanced clinical studies for reasons other than safety. Ore Pharmaceuticals Inc has a market cap of $3.2 million; its shares were traded at around $0.5803 with and P/S ratio of 1.6.
Highlight of Business Operations:
We have incurred net losses in each year since our inception, including losses of $22.5 million in 2008 and $34.7 million in 2007. At March 31, 2009, we had an accumulated deficit of $376.0 million. Our losses have resulted principally from costs incurred from the businesses we sold and the development of our drug development business. We expect to incur additional losses in the future.
Selling, General and Administrative Expense. Selling, general and administrative expenses, which now consist primarily of accounting, legal, human resources and other general corporate expenses, decreased to $2.3 million for the three months ended March 31, 2009 from $5.2 million for the same period in 2008 primarily as a result of lower employee and facility-related costs due to our significant workforce reductions, reduced professional fees relating to strategic planning and the absence of $0.5 million in accelerated lease costs and $0.4 million of expense related to the purchase of shares from a former director that occurred in 2008. For 2009, we expect a significant decrease in selling, general and administrative expenses over 2008, primarily as a result of workforce reductions.
Historically, we have financed our operations through the issuance and sale of equity securities, payments from customers and sales of parts of our business and assets from time to time. As of March 31, 2009, we had approximately $7.1 million in cash and cash equivalents, compared to $10.8 million as of December 31, 2008.
Net cash from operating activities increased to a negative $3.6 million for the three months ended March 31, 2009 from a negative $6.6 million for the same period in 2008, primarily due to our reduced net loss for the three months ended March 31, 2009. Based on current expectations of cash usage and collection of outstanding notes, we presently anticipate that we will have sufficient cash to initiate and complete the Phase Ib/IIa clinical trial for ORE1001, which is expected to begin mid 2009 and to be completed in mid to late 2010. We currently expect our cash usage for the second quarter of 2009 to be similar to that of the first quarter (not taking into account the collection of the Ocimum $3.0 million promissory note that is due June 2009). We also expect our cash usage for the second half of 2009 to be significantly lower than the first half.
In connection with the 2007 sale of the assets of our Genomics Division to Ocimum Biosolutions, Inc. (“Ocimum”), the balance of the sales price is due pursuant to a $3.0 million non-interest bearing promissory note due June 2009. Ocimum also assumed the lease obligations of our former Genomics laboratory and office facility, but we remain liable under the lease in the event of Ocimum s default. Our liability expires for obligations under the lease in February 2011, and at March 31, 2009, we could be liable for amounts due under the lease that total $2.0 million. Ocimum has deposited $0.8 million in escrow to partially secure both Ocimum s performance under the lease and payment of the note.
In connection with the 2006 sale of our Preclinical Division to Bridge Pharmaceuticals, Inc. (“Bridge”), less than $0.1 million of the sales price remains in escrow pending resolution between the parties. We continue to guarantee two leases now held by Bridge. The leases expire in February 2011 and December 2013 and at March 31, 2009, the total remaining amounts due under the leases for the balance of the terms is $1.1 million and $3.4 million, respectively.
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