InterMune says second-quarter net loss of $44 million impacted by $30 million settlement

By Lisa Kerner

Charlotte, N.C., July 27 - InterMune, Inc. recorded a net loss for the quarter ended June 30 of $44.0 million, or $1.33 per share.

For the quarter, the company included $30.0 million in expense taken as a reserve related to a proposed settlement with the government.

The reserve is in connection to a proposed comprehensive settlement with the government concerning promotional activities for Actimmune by former employees during a period ending in January 2003. This settlement, currently being negotiated, should resolve all outstanding government investigations and should not negatively impact the company's key research and development programs, including its two phase 3 clinical programs of Actimmune, the company said. The monetary settlement will be paid over a period of years.

Excluding the $30.0 million reserve, the net loss for the second quarter of 2006 was $14.0 million, or $0.42 per share, up from a net loss of $23.7 million, or $0.74 per share, in the second quarter of 2005.

Total revenue for the second quarter of 2006 was $24.1 million, comprised solely of Actimmune sales, down slightly from second-quarter 2005 total revenue of $26.7 million, which included revenue from Actimmune and Aralast (which InterMune no longer co-promotes).

For the six months ended June 30, InterMune had a net loss $56.8 million, or $1.73 per share. This includes the $30 million reserve.

Excluding the $30.0 million reserve, the net loss for the period was $26.8 million, or $0.81 per share, which compares to a net loss for the same period in 2005 of $41.1 million, or $1.28 per share.

For the six month period, InterMune reported total revenue of $48.5 million, a 12% decrease from the $55.0 million reported for the same period in 2005.

Actimmune revenue for the first half of 2006 of $48.5 million was down 10% from the prior year period's reported $53.6 million.

As of June 30, InterMune had cash, cash equivalents and available for sale securities of $180.1 million.

Management's guidance for 2006 includes annual revenue in the range of $75-100 million.

InterMune is a biotechnology company located in Brisbane, Calif.

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