Dragon Pharmaceuticals Inc. (TSX: DDD; OTC BB: DRUG) today announced results for the three-month and nine-month periods ending September 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 $3.8 million, a significant increase from revenues of $787,682 in the third quarter of 2001. The majority of the revenue comes from a single $3 million order for drug development. The balance of 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 $745,000 were generated from sales in China and $3.03 million from sales in other countries.
For the third quarter 2002, operating expenses were $1.7 million, up from $1.5 million from the same period last year, largely due to an increased investment in Research and Development efforts. Research expenses were $350,003 in the third quarter 2002 compared to $9,037 for the comparable period a year ago. These expenses included $100,000 for accelerating the development of the Company’s insulin project and $250,000 for the development of the G-CSF project.
Net profit was $1.6 million, or $0.08 per share, compared to a loss of $737,782, or $0.04 per share, for the third quarter of fiscal 2001.
For the nine-month period, revenues in 2002 more than tripled to $6.2 million. Net loss for the first nine months of 2002 was $1.1 million ($0.06 per share) compared to a loss of $2.6 million ($0.15 per share) for the nine months ended September 30, 2001.
“We are pleased that we have achieved an impressive growth for the quarter? said Dr. Alexander Wick, Dragon’s newly appointed President. “The third quarter revenues include the sale of our recombinant Erythropoietin (EPO) to a well-established pharmaceutical company for drug research and development purposes. The sale marks the break-through of selling our EPO to pharmaceutical companies for research purposes, a new potential business segment that we are actively exploring. This pharmaceutical company conducted extensive due diligence prior to selecting our EPO. Their order represents a strong endorsement of the quality of our product.”
Dragon also announced that it has signed up three new distribution partners, bringing the total number of licensing agreements to fourteen. The new distribution partners are:
– Al-Mak Flower, Inc. covering Macedonia, Kosovo and Albania;
– P.T. Ikapharmindo Putramas Healthcare, Ltd. covering Indonesia; and
– Biogenetech Co., Ltd. covering Thailand, Vietnam, Burma, Laos, Cambodia and the Philippines
“We are pleased to welcome these three new partners on board. We now have licensing agreements in place covering essentially all of the non-patented countries,?said Dr. Wick. “Although our current focus remains on sales in the developing world, we are actively preparing ourselves to enter the European market upon the expiry of the patent.”