Ziopharm takes bigger loss as research costs grow

Ziopharm takes larger 4th-quarter loss as payment to Intrexon drives up its expenses

Associated Press

NEW YORK (AP) -- Drug developer Ziopharm Oncology Inc. said Monday it took a larger loss in the fourth quarter as its research and development expenses nearly tripled.

During the fourth quarter Ziopharm said it started treating patients in a midstage clinical trial of a therapy that is designed to use the immune system to fight cancer. Once treatment began, the company issued 3.6 million shares of stock to Intrexon Corp., its partner on the drug. Ziopharm took a charge of $18.7 million as a result.

Including that charge Ziopharm said its research and development costs climbed to $35 million from $12.7 million a year ago. The company took a loss of $30.2 million, or 37 cents per share, in the fourth quarter. Ziopharm said its loss totaled 48 cents per share if one-time gains and charges are excluded. It lost $13.2 million, or 19 cents per share, in the fourth quarter of 2011. Revenue was unchanged at $200,000.

Analysts were expecting a loss of 28 cents per share and $200,000 in revenue, according to FactSet.

Before the end of March Ziopharm plans to report data from a late-stage clinical trial of its drug palifosfamide as a treatment for soft tissue sarcoma. It is enrolling patients in another late-stage trial evaluating the drug as a lung cancer treatment, and recently started a mid-stage trial of the drug as a treatment for testicular and ovarian cancer. It does not have any products on the market.

Ziopharm says palifosfamide is designed to stop tumor growth by binding to the DNA of cancer cells and interfering with DNA function. Ziopharm's Picasso trial is intended to evaluate palifosfamide and a chemotherapy drug as primary treatment for soft tissue sarcoma that has metastasized. The company says it will report results from the study during the last week of March.

The other late-stage trial, Matisse, evaluates palifosfamide as part of a regimen for metastatic small cell lung cancer in patients who have not been treated with chemotherapy.

Palifosfamide is given intravenously, but Ziopharm said it is also studying a capsule version.

The company reported a loss of $96.1 million, or $1.22, in 2012 after losing $63.8 million, or 97 cents per share, in 2011. Revenue rose to $800,000 from $667,000.

Ziopharm Oncology shares picked up 10 cents to $5.71 Monday and fell 2 cents to $5.69 in aftermarket trading.

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