pSivida Corp. Reports Fourth Quarter and Fiscal Year 2011 Results

WATERTOWN, Mass.–(BUSINESS WIRE)–pSivida Corp. (NASDAQ: PSDV) (ASX: PVA), a leader in developing
sustained release, drug delivery products for treatment of
back-of-the-eye diseases, including clinical stage product candidates
for the treatment of diabetic macular edema (DME), uveitis affecting the
posterior segment of the eye (posterior uveitis) and glaucoma, today
announced financial results for its fourth quarter and fiscal year ended
June 30, 201.

“We believe we have made very good progress this year in developing our
clinical stage product pipeline with both our partnered and unpartnered
programs”

At June 30 2011, cash, cash equivalents and marketable securities
totaled $24.1 million compared to $17.6 million at June 30, 2010.

“We believe we have made very good progress this year in developing our
clinical stage product pipeline with both our partnered and unpartnered
programs,” said Paul Ashton, President and CEO. “ILUVIEN® for DME,
partnered with Alimera Sciences, is well along, with action by the FDA
expected in November. We are very optimistic about this product,
particularly in light of the 3-year data and subgroup analysis provided
to the FDA in May.”

“In addition to ILUVIEN, we have two other product candidates in
clinical trials. We announced earlier today the opening of an
Investigational New Drug Application (IND) for an investigator-sponsored
trial in posterior uveitis. This trial will use inserts of the same
design as those used in the ILUVIEN for DME trials. Our collaboration
agreement with Alimera allows us to reference the DME regulatory
filings, including the NDA (including clinical, safety and stability
data from the Phase III trials), which provides the potential for an
abbreviated clinical development and regulatory approval process. We
also announced in June that the bioerodilble latanoprost insert for
glaucoma (partnered with Pfizer) is in a clinical trial,” said Dr.
Ashton.

On May 12, 2011, Alimera resubmitted the NDA for ILUVIEN for DME, an
injectable Durasert™ insert delivering the corticosteroid fluocinolone
acetonide (FAc), to respond to the FDA’s Complete Response Letter.
Alimera has reported that it expects a response from the FDA in November
2011.

Under the June 2011 amended and restated collaboration agreement with
Pfizer, the Company granted Pfizer an exclusive option under various
circumstances to license the development and commercialization worldwide
of an injectable, bioerodible sustained release insert delivering
latanoprost for human ophthalmic disease or conditions other than
uveitis. Pfizer made an upfront payment of $2.3 million, and the Company
has the right to develop this product candidate through Phase II
clinical trials. In June 2011, the Company announced a Phase I/II dose
escalating study designed to assess the safety and efficacy of this
insert in patients with elevated intraocular pressure.

On September 12, 2011, the Company announced the opening of an IND for
an investigator-sponsored Phase I/II clinical trial to assess the safety
and efficacy of the Company’s injectable, sustained release insert
delivering FAc for the treatment of uveitis affecting the posterior
segment of the eye. The inserts in the trial deliver the high and low
dose of FAc studied in the Phase III trials of ILUVIEN for DME. The
Company licensed Alimera the right to use this insert for the treatment
and prevention of eye diseases in humans other than uveitis.

Revenues for the year ended June 30, 2011 totaled $5.0 million compared
to $23.1 million for the year ended June 30, 2010. Fiscal 2011 revenues
were primarily attributable to the June 2011 amendment and restatement
of the Company’s collaboration agreement with Pfizer, while the prior
year’s revenues were predominantly due to payment in full by Alimera of
a $15.0 million conditional note and recognition of deferred revenue
from the Alimera agreement, which was completed in the fiscal 2010
second quarter. For the year ended June 30, 2011, the Company reported a
net loss of $8.6 million, or $0.44 per share, compared to net income of
$8.8 million, or $0.46 per diluted share, for the prior fiscal year.

Revenues for the fiscal 2011 fourth quarter were $3.7 million compared
to $15.7 million a year earlier, reflecting revenues from the Pfizer
agreement in fiscal 2011 and the Alimera note repayment in the fiscal
2010 quarter. The Company reported a net loss of $140,000, or $0.01 per
share, for the fourth quarter ended June 30, 2011, compared to net
income of $13.1 million, or $0.68 per diluted share, for the fourth
quarter of the prior year.

Today’s Conference Call Reminder

pSivida Corp. will host a live webcast and conference call today,
September 12, 2011, at 4:30 pm ET. The conference call may be accessed
by dialing (866) 203-2528 from the U.S. and Canada, or (617) 213-8847
from international locations, passcode 80736748. The conference can also
be accessed on the pSivida Corp. website at www.psivida.com.
A replay of the call will be available approximately two hours following
the end of the call through September 19, 2011. The replay may be
accessed by dialing (888) 286-8010 within the U.S. and Canada or (617)
801-6888 from international locations, passcode 46828003.

About pSivida Corp.

pSivida Corp., headquartered in Watertown, MA, develops tiny, sustained
release, drug delivery products designed to deliver drugs at a
controlled and steady rate for months or years. pSivida is currently
focused on treatment of chronic diseases of the back of the eye
utilizing its core technology systems, Durasert™ and BioSilicon™.
ILUVIEN® for the treatment of Diabetic Macular Edema, which is licensed
to Alimera Sciences, Inc., is pSivida’s most advanced product candidate
and is currently under review by the U.S. Food and Drug Administration.
An investigator-sponsored Investigational New Drug application opened
for an injectable insert to treat posterior uveitis of the same design
as ILUVIEN for DME, and an investigator-sponsored trial is ongoing for
an injectable, bioerodible insert to treat glaucoma and ocular
hypertension. pSivida’s two FDA-approved products, Retisert® and
Vitrasert®, are implants that provide long-term, sustained drug delivery
to treat two other chronic diseases of the retina.

SAFE HARBOR STATEMENTS UNDER THE PRIVATE SECURITIES LITIGATION REFORM
ACT OF 1995: Various statements made in this release are
forward-looking, and are inherently subject to risks, uncertainties and
potentially inaccurate assumptions. All statements that address
activities, events or developments that we intend, expect or believe may
occur in the future are forward-looking statements. The following are
some of the factors that could cause actual results to differ materially
from the anticipated results or other expectations expressed,
anticipated or implied in our forward-looking statements: ability to
obtain additional capital if needed; future losses; impairment of
intangibles; fluctuations in the fair values of certain outstanding
warrants; fluctuations in operating results; decline of royalty income
from Bausch & Lomb; Alimera’s ability to obtain regulatory approval of
ILUVIEN; Alimera’s ability to successfully commercialize ILUVIEN if
approved; risk/benefit profile of ILUVIEN; timeliness of approval, if
any, of ILUVIEN and any limitations on uses thereof; ability to complete
clinical trials, reference data and obtain regulatory approval of other
product candidates; ability to find partners to develop and market
products; termination of license agreements; competition; market
acceptance of products and product candidates; reduction in use of
products as a result of future publications; ability to protect
intellectual property or infringement of others’ intellectual property;
retention of key personnel; product liability; consolidation in the
pharmaceutical and biotechnology industries; compliance with
environmental laws; manufacturing risks; risks and costs of
international business operations; credit and financial market
conditions; legislative or regulatory changes; volatility of stock
price; possible dilution through exercise of outstanding warrants and
stock options or future stock issuances; possible influence by Pfizer;
ability to pay any registration penalties; absence of dividends; and
other factors described in our filings with the Securities and Exchange
Commission. Given these uncertainties, readers are cautioned not to
place undue reliance on such forward-looking statements. Our
forward-looking statements speak only as of the dates on which they are
made. We do not undertake any obligation to publicly update or revise
our forward-looking statements even if experience or future changes
makes it clear that any projected results expressed or implied in such
statements will not be realized.

 
PSIVIDA CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands except per share amounts)
     

 

 
 
Three Months Ended Year Ended
June 30, June 30,
 

2011

2010 2011

2010

 
Revenues:
Collaborative research and development $ 3,394 $ 15,328 $ 3,612 $ 22,570
Royalty income 321 394 1,353 483
       
 
Total revenues   3,715

 

  15,722    

4,965     23,053  
 
Operating expenses:
Research and development 1,851 1,785 6,864 6,994
General and administrative 2,172 1,763

8,104

6,968

       
 
Total operating expenses   4,023  

 

3,548     14,968    

13,962

 
 

Operating (loss) income

 

(308 )   12,174     (10,003 )  

9,091

 
 

Other income (expense):

Change in fair value of derivatives

10 870 1,140 (339 )
Interest income 11 25 30 27
Other expense, net (2 ) (11 ) (13 ) (3 )
     

 

 

Total other income (expense)   19     884

 

  1,157  

 

(315 )
 
(Loss) income before income taxes (289 ) 13,058 (8,846

)

8,776
Income tax benefit (expense) 149 15 218 (23 )
   

 

 
 
 
Net (loss) income $

(140

) $ 13,073   $ (8,628 ) $ 8,753  

 

Net (loss) income per share:

 
Basic $ (0.01 ) $ 0.71   $ (0.44 ) $ 0.48  

 

Diluted $ (0.01 ) $ 0.68   $ (0.44 ) $ 0.46  
 
Weighted average common shares outstanding:
 
Basic  

20,745     18,531     19,489    

18,405

 
 

Diluted

 

20,745     19,217  

 

19,489

   

18,895  
 

PSIVIDA CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands)
 

 

June 30, June 30,

2011

2010

 

Assets
Current assets:
Cash, cash equivalents and marketable securities $ 24,128 $ 17,565
Other current assets

1,238

1,469

 

 

 

Total current assets

25,366 19,034
Intangible assets, net 21,564 23,877

Other assets

183 103
 

 
 

Total assets $ 47,113   $ 43,014  
 
Liabilities and stockholders’ equity

Current liabilities:
Accounts payable and accrued expenses $ 1,650 $ 1,545
Deferred revenue 3,212 79
Derivative liabilities 170 1,310
   
 
Total current liabilities 5,032 2,934
Deferred revenue 4,635 6,817
Deferred tax liabilities 13 222
   

 
Total liabilities

  9,680    

9,973

 
 
Stockholders’ equity:
Capital 262,927 250,815
Accumulated deficit (226,923 ) (218,295 )
Accumulated other comprehensive income 1,429 521
   
 
Total stockholders’ equity  

37,433     33,041  
 
Total liabilities and stockholders’ equity

$ 47,113

 

$ 43,014  

Contacts

US Public Relations
Beverly Jedynak
President
Martin
E. Janis & Company, Inc
Tel: +1 (312) 943 1123
bjedynak@janispr.com
or
pSivida
Corp.

Brian Leedman
Vice President, Investor Relations
pSivida
Corp.
Tel: +61 8 9443 4949
brianl@psivida.com

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