Enzon reports $11.0 million second quarter net income; starts Oncaspar phase 1 clinical trial

By Jennifer Lanning Drey

Eugene, Ore., Aug. 1 - Enzon Pharmaceuticals, Inc. reported second quarter net income of $11.0 million, or $0.25 per diluted share, on revenues of $47.6 million, according to a company news release.

The company also announced recent clinical advancements made by its oncology product Oncaspar and within its recombinant human Mannose-Binding Lectin (rhMBL) program.

The latest results were improved from the net loss of $85.5 million, or $1.97 per diluted share, on revenues of $43.7 million recorded in the second quarter of 2005, according to the release.

"While we reported net income in this quarter, I remind you that short-term profitability is not our primary goal. We will continue to invest in the long-term growth opportunities that will sustain the future of the new Enzon," said Jeffrey H. Buchalter, chairman and chief executive officer of Enzon, during a company conference call held Tuesday.

The company announced Tuesday that it has started a phase 1 clinical trial of Oncaspar to assess its safety and potential use in the treatment of advanced solid tumors and lymphomas in combination with Gemzar (gemcitabine HCl for injection).

"We remain committed to maximizing the potential of Oncaspar through strategic clinical development," said Buchalter.

In addition, Enzon also said Tuesday that the Food and Drug Administration has completed its review of the company's Investigational New Drug application for the use of rhMBL for the prevention and treatment of severe infections in certain patients with multiple myeloma.

Enzon expects to begin a randomized phase 1/2 trial later this summer, Buchalter said.

The company plans to expand the rhMBL program to include children and will continue to explore additional potential therapeutics for the program, he said.

In addition, Enzon believes its recently announced a collaborative agreement with Santaris Pharma A/S is helping to address previous gaps in its pipeline, Buchalter said.

Under the collaborative agreement, Enzon will develop and commercialize a series of RNA antagonists based on Santaris' locked nucleic acid technology.

"This is an important and transformational deal for Enzon on a number of levels. This partnership is strategically aligned with our goals of building a premier oncology franchise in biotechnology by significantly helping to rebuild both our research and development pipelines," Buchalter said.

The collaboration will provide Enzon the opportunity to gain two new clinical programs in the next six to 12 months, as well as six new targets for discovery research, he added.

Improved balance sheet

At June 30, Enzon reported cash reserves of $369.6 million compared with $226.6 million at Dec. 31, 2005.

The key event affecting the company's balance sheet for the quarter was the successful refinancing of the majority of its debt position, said Craig Tooman, chief executive officer of Enzon, during Tuesday's call.

"We are very pleased that we were able to raise $275 million, which represented approximately 70% of our debt and extended it out to 2013," he said.

Enzon is a biopharmaceutical company located in Bridgewater, N.J.

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