Dragon Pharmaceuticals Inc. (TSX: DDD; OTC BB: DRUG) today announced results for the three-month and six-month periods ending June 30 2002. For greater detail, please refer to the Company’s 10-QSB, which has been filed with the U.S. Securities and Exchange Commission and the Ontario Securities Commission. The full financial statements will also be available on Dragon’s website at www.dragonbiotech.com. The Company’s financial statements comply with U.S. GAAP (Generally Accepted Accounting Principles) and all dollar amounts are expressed in U.S. currency.
During the quarter, the Company posted revenues of $1.03 million, up more than 70% from revenues of $602,341 in the second quarter of 2001. The Company’s revenues are derived from sales of EPO, which is currently approved and marketed for use in the treatment of anemia related to chronic renal failure in China, India, Egypt and Peru. Revenues of $826,659 were generated from sales in China and $199,500 from sales in other developing countries. Gross profit margin rose to 83% from 74% in the same period last year, due to improved production efficiency.
For the second quarter 2002, operating expenses were $2.69 million, up from $1.54 million from the same period last year, largely due to an increased investment in Research and Development efforts. Research expenses were $1.02 million in the second quarter 2002 compared to just $26,537 for the comparable period a year ago. These expenses included $750,000 to fund preclinical studies for the Company’s insulin project and $250,000 for the development of the G-CSF project. Total contracted development costs for the insulin and G-CSF projects, from cell line development through to preclinical and clinical studies and submission to the SDA for drug licenses, are expected to be $2.5 million and $2.0 million respectively.
Net loss was $1.82 million, or $0.09 per share, compared to a loss of $972,713, or $0.06 per share, for the second quarter of fiscal 2001.
For the six-month period, revenues in 2002 doubled to $2.40 million. Net loss for the first six months of 2002 was $2.76 million ($0.14 per share) compared to a loss of $1.83 million ($0.11 per share) for the six months ended June 30, 2001.
“While we remain confident that revenues for 2002 will increase at least 100% over 2001 revenues of $3.1 million, we anticipate that sales revenues for the year will be lower than previously forecast due to generally weaker market conditions and delayed product approvals resulting from increasing regulatory requirements in several key countries,”said Dr. Longbin Liu, President and CEO. “Dragon is complying with the regulatory changes and fully expects to successfully complete product registrations and subsequently launch EPO in these markets.
As previously announced, during the quarter Dragon began trading on the Toronto Stock Exchange, under the symbol DDD. Listing on a senior stock exchange should help the Company gain an institutional following and raise its profile in the Canadian investment community.