<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
X Quarterly report pursuant to Section 13 or 15(d) of the Securities
- ------- Exchange Act of 1934. For the quarterly period ended September 30,
1997.
Transition report pursuant to Section 13 or 15(d) of the Securities
- ------- Exchange Act of 1934. For the transition period from to _________.
Commission File Number
0-23160
ANESTA CORP.
(Exact name of registrant as specified in its charter)
4745 Wiley Post Way
Plaza 6, Suite 650
Salt Lake City, UT 84116
(801) 595-1405
(Address, including zip code, and telephone number,
including area code, of principal executive offices)
Securities registered pursuant to Section 12(g) of the Act:
Common Stock $.001 par value
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Sections 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
--- ---
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date .
Common Stock $.001 par value 9,538,767
Class Outstanding at November 10, 1997
<PAGE> 2
ANESTA CORP.
INDEX
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION PAGE NO.
--------
<S> <C>
Balance Sheets -
September 30, 1997 (unaudited) and December 31, 1996 2
Statements of Operations -
for the three and nine months ended September 30, 1997 and
1996 (unaudited) and the period from inception (August 1, 1985)
to September 30, 1997 (unaudited) 3
Statements of Cash Flows -
for the nine months ended September 30, 1997 and 1996 (unaudited)
and the period from inception (August 1, 1985) to
September 30, 1997 (unaudited) 4
Notes to Financial Statements (unaudited) 6
Management's Discussion and Analysis of
Financial Condition and Results
of Operations 9
PART II. OTHER INFORMATION 12
SIGNATURES 13
</TABLE>
1
<PAGE> 3
ANESTA CORP.
(A Development Stage Company)
BALANCE SHEETS
-----------
<TABLE>
<CAPTION>
September 30, December 31,
ASSETS 1997 1996
------------- ------------
(Unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 12,743,358 $ 22,807,608
Current portion of certificate of deposit 255,000 153,000
Marketable debt securities,
available-for-sale 18,403,343 17,173,950
Accounts receivable 505,428 485,648
Prepaid expenses and other current assets 628,088 291,983
------------ ------------
Total current assets 32,535,217 40,912,189
------------ ------------
Property and equipment, at cost:
Furniture and equipment 895,145 847,521
Leasehold improvements 1,524,414 1,476,743
Accumulated depreciation (792,354) (617,058)
------------ ------------
1,627,205 1,707,206
------------ ------------
Other assets:
Certificate of deposit 1,785,000 1,224,000
Other assets 796,286 115,474
------------ ------------
2,581,286 1,339,474
------------ ------------
Total assets $ 36,743,708 $ 43,958,869
============ ============
</TABLE>
<TABLE>
<CAPTION>
September 30, December 31,
LIABILITIES AND STOCKHOLDERS' EQUITY 1997 1996
------------- ------------
(Unaudited)
<S> <C> <C>
Current liabilities:
Accounts payable $ 559,182 $ 518,965
Accrued liabilities
Accrued compensation 685,554 332,020
Accrued research and development costs 200,000 200,000
Other 89,048 92,503
Current portion of notes payable 250,000 150,000
------------ ------------
Total current liabilities 1,783,784 1,293,488
Unearned advance royalty revenues 350,000 350,000
Notes payable 1,750,000 1,200,000
------------ ------------
Total liabilities 3,883,784 2,843,488
------------ ------------
Stockholders' equity:
Common stock, par value, $.001 per share; Authorized:
15,000,000 shares; Issued: 9,532,059
in 1997 and 9,440,129 in 1996 9,532 9,440
Additional paid-in capital 61,983,143 61,531,623
Deficit accumulated during the development stage (29,142,156) (20,413,153)
Treasury stock (345 shares), at cost (4,226)
Notes receivable from issuance of common stock (7,000) (7,000)
Unrealized gain (loss) on marketable debt securities,
available-for-sale 16,405 (1,303)
------------ ------------
Total stockholders' equity 32,859,924 41,115,381
------------ ------------
Total liabilities and stockholders' equity $ 36,743,708 $ 43,958,869
============ ============
</TABLE>
The accompanying notes are an integral
part of the financial statements
2
<PAGE> 4
ANESTA CORP.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
(Unaudited)
--------
<TABLE>
<CAPTION>
Three months ended Nine months ended Period from
----------------------------- ----------------------------- inception
September 30, September 30, September 30, September 30, (August 1, 1985) to
1997 1996 1997 1996 September 30, 1997
------------- ------------- ------------- ------------- ------------------
<S> <C> <C> <C> <C> <C>
Revenues:
Product sales $ 50,225 $ 19,999 $ 109,425 $ 69,949 $ 299,856
Royalty revenue 1,489 578 3,243 2,037 108,834
Revenues from contract research 378,000 1,128,000 9,978,931
------------ ------------ ------------ ------------ ------------
Total revenues 51,714 398,577 112,668 1,199,986 10,387,621
------------ ------------ ------------ ------------ ------------
Operating costs and expenses:
Cost of goods sold 14,251 5,047 31,396 20,487 99,085
Royalties 1,551 617 3,380 2,160 10,880
Research and development 2,003,995 2,001,270 5,353,295 5,757,184 28,199,057
Depreciation and amortization 58,801 57,334 177,988 177,532 1,005,544
Marketing, general and administrative 1,882,164 888,723 4,723,272 2,451,508 14,080,843
------------ ------------ ------------ ------------ ------------
Total costs and expenses 3,960,762 2,952,991 10,289,331 8,408,871 43,395,409
------------ ------------ ------------ ------------ ------------
Loss from operations (3,909,048) (2,554,414) (10,176,663) (7,208,885) (33,007,788)
Non operating income (expense):
Interest income 479,025 583,273 1,540,489 1,353,012 5,884,846
Interest expense (38,451) (26,950) (94,440) (84,211) (447,424)
Other (557) (12,326) 3,150 (3,933) (36,211)
------------ ------------ ------------ ------------ ------------
Loss before provision for income
taxes, extraordinary item and cumulative
effect of change in accounting (3,469,031) (2,010,417) (8,727,464) (5,944,017) (27,606,577)
Provision for income taxes (729) (1,539) (100) (24,944)
------------ ------------ ------------ ------------ ------------
Loss before extraordinary item and
cumulative effect of change in accounting (3,469,760) (2,010,417) (8,729,003) (5,944,117) (27,631,521)
Extraordinary item - reduction of income
taxes arising from carryforward of prior
years' operating losses 22,296
Cumulative effect of change in accounting (1,041,047)
------------ ------------ ------------ ------------ ------------
Net loss $ (3,469,760) $ (2,010,417) $ (8,729,003) $ (5,944,117) $(28,650,272)
============ ============ ============ ============ ============
Loss per common share amounts--
Loss before extraordinary item and cumulative
effect of change in accounting $ (0.36) $ (0.21) $ (0.92) $ (0.73)
Cumulative effect of change in accounting
------------ ------------ ------------ ------------
Net loss per common share $ (0.36) $ (0.21) $ (0.92) $ (0.73)
------------ ------------ ------------ ------------
Shares used in computing net
loss per common share 9,509,539 9,403,509 9,485,720 8,191,839
------------ ------------ ------------ ------------
</TABLE>
The accompanying notes are an integral
part of the financial statements
3
<PAGE> 5
ANESTA CORP.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
(Unaudited)
--------
<TABLE>
<CAPTION>
Nine months ended Period from
------------------------------- inception
September 30, September 30, (August 1, 1985) to
1997 1996 September 30, 1997
------------- ------------- -------------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss $ (8,729,003) $ (5,944,117) $(28,650,272)
Adjustments to reconcile net loss to net cash
used in operating activities
Cumulative effect of change in accounting 1,041,047
Depreciation and amortization 177,988 177,532 1,005,544
Debt conversion expense 101,330
Interest converted to equity 94,104
Compensatory stock options and stock 3,539
(Gain) loss on retirement of assets 859 13,783 63,237
Increase (decrease) due to changes in:
Accounts receivable (19,781) (63,281) (505,428)
Prepaid expenses and other current assets (336,105) (373,986) (628,088)
Other assets (680,811) (23,851) (798,863)
Accounts payable 40,217 (64,788) 559,182
Accrued liabilities 350,079 136,014 974,602
Unearned advance royalty revenues 350,000
------------ ------------ ------------
Net cash used in operating activities (9,196,557) (6,142,694) (26,390,066)
------------ ------------ ------------
Cash flows from investing activities:
Capital expenditures (98,871) (40,877) (2,419,459)
Proceeds from sale of assets 25 150 10,250
Costs associated with license agreements (1,109,533)
Advances to employees (1,650)
Purchase of marketable debt securities,
available-for-sale (6,191,468) (6,063,003) (45,819,003)
Proceeds from sale of marketable debt securities,
available-for-sale 4,979,783 8,545,530 27,413,661
Purchase of treasury bills (1,174,419)
Proceeds from maturity of treasury bills 1,174,419
Purchase of certificate of deposit (816,000) (2,346,000)
Proceeds from maturity of certificate of deposit 153,000 153,000 306,000
------------ ------------ ------------
Net cash provided by (used in) investing activities (1,973,531) 2,594,800 (23,965,734)
------------ ------------ ------------
Cash flows from financing activities:
Principal payments on notes payable (150,000) (150,000) (337,500)
Proceeds from issuance of notes payable 800,000 3,337,700
Principal payments on obligations under capital leases (14,954) (194,488)
Proceeds from issuance of common stock 455,838 28,075,590 60,248,211
Collections on notes receivable from
issuance of common stock 58,000
Proceeds from issuance of preferred stock 756,222
Deferred offering costs (277,103)
Dividends paid on preferred stock (491,884)
------------ ------------ ------------
Net cash provided by financing activities 1,105,838 27,910,636 63,099,158
------------ ------------ ------------
Net increase (decrease) in cash and cash equivalents (10,064,250) 24,362,742 12,743,358
Cash and cash equivalents at beginning of period 22,807,608 3,540,147
------------ ------------ ------------
Cash and cash equivalents at end of period $ 12,743,358 $ 27,902,889 $ 12,743,358
============ ============ ============
</TABLE>
- Continued -
The accompanying notes are an integral
part of the financial statements
4
<PAGE> 6
ANESTA CORP.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS, Continued
(Unaudited)
--------
<TABLE>
<CAPTION>
Nine months ended Period from
---------------------------- inception
September 30, September 30, (August 1, 1985) to
1997 1996 September 30, 1997
------------- ------------- -------------------
<S> <C>
SUPPLEMENTAL SCHEDULE OF NONCASH ACTIVITIES:
The Company issued stock and stock options for:
Purchase of additional license agreement $ 5,400
Notes receivable 71,000
The Company purchased leasehold improvements
using accounts payable 251,507
The Company entered into various capital lease
arrangements 204,610
The Company received stock as payment of a
note receivable 4,226
</TABLE>
The accompanying notes are an integral
part of the financial statements
5
<PAGE> 7
ANESTA CORP.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
-----------
1. Significant Accounting Policies:
In the opinion of management, the accompanying financial statements
contain all adjustments (consisting only of normal recurring items)
necessary to present fairly the financial position of Anesta Corp. (a
development stage company) (the Company) as of September 30, 1997, and
the results of its operations for the three and nine months ended
September 30, 1997 and 1996 and for the period from inception (August
1, 1985) to September 30, 1997, and its cash flows for the nine months
ended September 30, 1997 and 1996 and for the period from inception
(August 1, 1985) to September 30, 1997. The results of operations for
the periods presented are not necessarily indicative of the results to
be expected for the full year period.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested
that these financial statements be read in conjunction with the
Company's Annual Report on Form 10-K for the period ended December 31,
1996.
Net Loss Per Share
Net loss per common share is computed using the weighted average
number of common and common equivalent shares outstanding during each
period. Common stock equivalents consist of convertible preferred
stock, common stock options and warrants. Common equivalent shares
are excluded from the computation when their effect is antidilutive.
Net loss per common share for the period from inception to September
30, 1997 has not been presented as such information is not considered
to be relevant or meaningful.
2. Cash and Cash Equivalents and Marketable Debt Securities:
At September 30, 1997, the Company maintained a majority of its cash
and cash equivalents and marketable debt securities in two banks in
San Francisco, California.
3. Income Taxes:
The provision for income taxes for the three months ended September
30, 1997 and for the nine months ended September 30, 1997 and 1996 is
related solely to state income taxes.
6
<PAGE> 8
ANESTA CORP.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS, Continued
(Unaudited)
-----------
4. Revolving/Term Promissory Note Agreements:
On January 11, 1995, the Company entered into a revolving/term
promissory note in the amount of $1.5 million and on May 15, 1995, the
term of the revolving promissory note ended and the Company entered
into a 10 year term note in the amount of $1.5 million. Additionally,
on March 20, 1997 the Company entered into an 8 year term note for an
additional $800,000, for a total of $2.3 million. The agreements
provide for a constant interest rate of "160 basis points" above the
financial institution's certificate of deposit rate (6.00% at
September 30, 1997). As of September 30, 1997 two payments totaling
$300,000 had been made leaving a balance of $2,000,000. Annual
payments in the amount of $250,000 will be made on approximately July
15 for the next 8 years beginning on July 15, 1998. Borrowings under
the agreement are collateralized by a certificate of deposit in the
amount of $2,040,000, which is maintained in a bank in Salt Lake City,
Utah.
5. Funding Agreements:
Effective September 8, 1995, the Company entered into a 1996 funding
agreement with Abbott Laboratories Hospital Products Division
(Abbott), under which Abbott provided $1,500,000 of funding to further
the clinical development of Actiq(TM) to treat cancer-related pain
(the "Actiq Cancer Pain Program"). Under the agreement, the Company
provided additional funding required for this program during the year
ended December 31, 1996 and completed certain program milestones.
7
<PAGE> 9
ANESTA CORP.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS, Continued
(Unaudited)
---------
6. Stockholders' Equity:
The table below presents the activity in stockholders' equity from
January 1, 1997 to September 30, 1997:
<TABLE>
<CAPTION>
Deficit
Common Stock Accumulated
---------------------------------------- During the Treasury Stock
Paid-in Development --------------------
Shares Amount Capital Stage Shares Amount
------------ ---------- ------------- --------------- --------------------
<S> <C> <C> <C> <C> <C> <C>
Balance at January 1, 1997 9,440,129 $9,440 $61,531,623 $(20,413,153) 345 $(4,226)
Exercise of stock options in Feb. 1997
(at $.80 per share) 28,563 28 22,822
Exercise of stock options in Mar. 1997
(at $.80 to $6.75 per share) 10,250 11 18,765
Exercise of stock options in Apr. 1997
(at $1.00 per share) 400 400
Exercise of stock options in May 1997
(at $5.00 to $11.00 per share) 7,578 8 64,139
Exercise of stock options in June 1997
(at $.80 to $12.75 per share) 3,987 4 23,152
Exercise of stock options in July 1997
(at $.80 per share) 5,625 6 4,494
Retirement of treasury stock in July
1997, at cost (345) (4,226) (345) 4,226
Exercise of stock options in Aug. 1997
(at $5.50 to $13.50 per share) 4,185 4 44,093
Exercise of stock options in Sept. 1997
(at $1.00 to $16.50 per share) 31,687 31 277,881
Net change in unrealized gain on
marketable debt securities, available-
for-sale
Net loss (8,729,003)
--------- ------ ----------- ------------ ------- --------
Balance at September 30, 1997 9,532,059 $9,532 $61,983,143 $(29,142,156) -- $ --
========= ====== =========== ============ ======= ========
<CAPTION>
Unrealized
Notes gain (loss) on
Receivable Marketable Debt
from Issuance Securities,
of Common Available-for-
Stock Sale Total
------------- --------------- ------------
<S> <C> <C> <C>
Balance at January 1, 1997 $ (7,000) $ (1,303) $ 41,115,381
Exercise of stock options in Feb. 1997
(at $.80 per share) 22,850
Exercise of stock options in Mar. 1997
(at $.80 to $6.75 per share) 18,776
Exercise of stock options in Apr. 1997
(at $1.00 per share) 400
Exercise of stock options in May 1997
(at $5.00 to $11.00 per share) 64,147
Exercise of stock options in June 1997
(at $.80 to $12.75 per share) 23,156
Exercise of stock options in July 1997
(at $.80 per share) 4,500
Retirement of treasury stock in July
1997, at cost --
Exercise of stock options in Aug. 1997
(at $5.50 to $13.50 per share) 44,097
Exercise of stock options in Sept. 1997
(at $1.00 to $16.50 per share) 277,912
Net change in unrealized gain on
marketable debt securities, available-
for-sale 17,708 17,708
Net loss (8,729,003)
-------- -------- ------------
Balance at September 30, 1997 $ (7,000) $ 16,405 $ 32,859,924
======== ======== ============
</TABLE>
8
<PAGE> 10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The following Management's Discussion and Analysis of Financial Condition and
Results of Operations contains forward- looking statements which involve risks
and uncertainties. The Company's actual results could differ materially from
those anticipated in these forward-looking statements as a result of certain
factors discussed in this section. Additional risks and uncertainties are
described in the Company's most recently filed SEC documents, including its
Form 10-K for the fiscal year ended December 31, 1996 and the Company's
Prospectus dated June 6, 1996.
RESULTS OF OPERATIONS
Revenues.
Total revenues decreased by $346,900 or 87.0% for the three months ended
September 30, 1997 as compared to the corresponding period in 1996 and by
$1,087,300 or 90.6% for the nine months ended September 30, 1997 as compared to
the corresponding period in 1996. The decrease is primarily a result of the
completion of funding by Abbott in 1996 under a collaborative funding
agreement. Substantially all revenues in the period ended September 30, 1996
were from development funding under the collaborative agreement with Abbott
relating to the Actiq Cancer Pain Program.
Under the Company's agreements with Abbott, Abbott manufactures Anesta's
OT-fentanyl product line (Fentanyl Oralet(R) and Actiq) and sells these
products to the Company at a price which reflects Abbott's cost of
manufacturing. The Company then sells the products to Abbott at a price
related to Abbott's selling price which results in a gross profit to the
Company ranging from approximately 40-70%. In addition, the Company is
entitled to receive a royalty on OT- fentanyl product sales by Abbott.
Operating Expenses.
Research and development expenses increased by $2,700 or 0.1% for the three
months ended September 30, 1997 as compared to the corresponding period in 1996
and decreased by $403,900 or 7.0% for the nine months ended September 30, 1997
as compared to the corresponding period in 1996. The decrease, for the nine
months ended September 30, 1997 as compared to the corresponding period in
1996, is due to higher expenditures in 1996 related to clinical research
programs and preparation for filing the Actiq New Drug Application (NDA). The
Company expects that its research and development expenses will increase in the
future as a result of increased expenses related to the hiring of additional
personnel, preclinical studies, clinical trials, product development and
manufacturing process development activities.
Depreciation expense increased by $1,500 or 2.6% for the three months ended
September 30, 1997 as compared to the corresponding period in 1996 and by $500
or 0.3% for the nine months ended September 30, 1997 as compared to the
corresponding period in 1996.
Marketing, general and administrative expenses increased by $993,400 or 111.8%
for the three months ended September 30, 1997 as compared to the corresponding
period in 1996 and by $2,271,800 or 92.7% for the nine months ended September
30, 1997 as compared to the corresponding period in 1996. The increase in
marketing, general and administrative expenses is due primarily to higher
expenditures for personnel, corporate development activities, marketing
research, Actiq pre-marketing activities, and equipment leasing. The Company
expects that its marketing and general and administrative expenses will
increase in the future as a result of the increased support required for
marketing research, Actiq pre-launch market development and market launch
activities, and corporate development activities.
9
<PAGE> 11
Non Operating Income (Expense).
Interest income decreased by $104,200 or 17.9% for the three months ended
September 30, 1997 as compared to the corresponding period in 1996 and
increased by $187,500 or 13.8% for the nine months ended September 30, 1997 as
compared to the corresponding period in 1996. Both the increase and decrease
are related to the net proceeds of $27,858,225 from the Company's secondary
offering in June 1996. The decrease is primarily due to a reduction in the
amount of invested funds for the three months ended September 30, 1997 as
compared to the corresponding period in 1996. The increase is primarily due to
additional invested funds for the nine months ended September 30, 1997 as
compared to the corresponding period in 1996.
Interest expense increased by $11,500 or 42.7% for the three months ended
September 30, 1997 as compared to the corresponding period in 1996 and by
$10,200 or 12.1% for the nine months ended September 30, 1997 as compared to
the corresponding period in 1996. The increase is primarily due to increased
borrowings under the term note (See Note 4 to Financial Statements).
Net Loss.
As a result of the decrease in total revenues, the increase in marketing,
general and administrative activities and other factors discussed above, the
net loss for the three months ended September 30, 1997 was $3,469,800 or $0.36
per share as compared to $2,010,400 or $0.21 per share for the same period in
1996. The net loss for the nine months ended September 30, 1997 was $8,729,000
or $0.92 per share as compared to $5,944,100 or $0.73 per share for the same
period in 1996.
LIQUIDITY AND CAPITAL RESOURCES
In June 1996 the Company realized net proceeds of $27,858,225 through the
issuance of common stock in a secondary offering. As of September 30, 1997,
the Company had cash and cash equivalents totaling $12,743,400, $2,040,000 in a
certificate of deposit used as collateral for a revolving/term loan (See Note 4
to Financial Statements) and $18,403,300 in marketable debt securities which
are available for sale. Thus cash, cash equivalents, certificate of deposit
and marketable debt securities totaled $33,186,701 as of September 30, 1997.
Cash in excess of immediate requirements is invested according to the Company's
investment policy, which provides guidelines with regard to liquidity and
return, and, wherever possible, seeks to minimize the potential effects of
concentration of credit risk.
The Company used cash in operating activities of $9,196,700 for the nine months
ended September 30, 1997 compared to $6,142,700 for the corresponding period in
1996. The increase in cash used in the period is a direct result of the
decrease in total revenues and the increase in marketing, general and
administrative activities discussed above.
During the nine months ended September 30, 1997, the Company made capital
expenditures of approximately $98,900 as compared to capital expenditures of
$40,900 during the corresponding period in 1996.
During the nine months ended September 30, 1997, the Company realized cash
proceeds of $455,800 relating to the exercise of stock options. During the
nine months ended September 30, 1996 the Company realized cash proceeds from
the issuance of common stock of $28,075,600 which includes $217,400 relating to
the exercise of stock options.
During the nine months ended September 30, 1997, the Company made no principal
payments on capital lease obligations as compared to $15,000 for the
corresponding period in 1996.
10
<PAGE> 12
The Company's future capital requirements could be substantial and will depend
on, and could increase as a result of, many factors, including progress of the
Company's research and development programs; the results and costs of
preclinical and clinical testing of the Company's products, if developed; the
time and costs involved in obtaining regulatory approvals; the costs involved
in filing patents; the time and costs involved in developing and maintaining
collaborative research relationships; the costs associated with potential
commercialization of its products, and administrative and legal costs.
The Company believes that it is prudent to monitor existing cash balances in
order to fund the activities which the Company believes are necessary to
continue its growth. Therefore, the Company periodically evaluates market
conditions and various financing alternatives for obtaining funds to augment
existing cash balances.
11
<PAGE> 13
PART II. OTHER INFORMATION
ITEM 5. OTHER INFORMATION.
On November 14, 1997 the Company released the press release filed as
exhibit 99.1 hereto entitled "Anesta Surprised on Receiving Not
Approvable Letter from FDA for Actiq".
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
a) EXHIBITS.
Exhibit
Number Description
------- -----------
27.1 Financial Data Schedule
99.1 Anesta Corp. November 14, 1997 Press Release
b) REPORTS ON FORM 8-K.
None.
12
<PAGE> 14
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: November 14, 1997
ANESTA CORP.
By: /s/ WILLIAM C. MOELLER
-----------------------------------
William C. Moeller, Chief
Executive Officer and
Treasurer
(Authorized Signatory and
Principal Financial Officer)
By: /s/ ROGER P. EVANS
-----------------------------------
Roger P. Evans, Controller
(Principal Accounting Officer)
13
<PAGE> 15
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<S> <C>
27 Financial Data Schedule
99.1 Anesta Corp. November 14, 1997 Press Release
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> SEP-30-1997
<CASH> 12,743
<SECURITIES> 18,403
<RECEIVABLES> 505
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 32,535
<PP&E> 2,420
<DEPRECIATION> 792
<TOTAL-ASSETS> 36,744
<CURRENT-LIABILITIES> 1,784
<BONDS> 1,750
0
0
<COMMON> 10
<OTHER-SE> 32,850
<TOTAL-LIABILITY-AND-EQUITY> 36,744
<SALES> 109
<TOTAL-REVENUES> 113
<CGS> 35
<TOTAL-COSTS> 10,289
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 94
<INCOME-PRETAX> (8,727)
<INCOME-TAX> 2
<INCOME-CONTINUING> (8,729)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (8,729)
<EPS-PRIMARY> (0.92)
<EPS-DILUTED> (0.92)
</TABLE>
<PAGE> 1
EXHIBIT 99.1
ANESTA NEWS RELEASE
- --------------------------------------------------------------------------------
FOR IMMEDIATE RELEASE Contact: William C. Moeller
or Thomas B. King
(801) 595-1405
ANESTA SURPRISED BY NOT APPROVABLE LETTER FROM FDA FOR ACTIQ
SALT LAKE CITY, UT -- November 14, 1997 --Anesta Corp. (Nasdaq: NSTA) announced
today that it had received a "not approvable" letter from the U.S. Food and
Drug Administration (FDA) for Actiqoral transmucosal fentanyl citrate). Anesta
has asked FDA to clear Actiq for use in the treatment of chronic and
breakthrough pain for cancer patients. The Actiq New Drug Application (NDA)
was submitted in November 1996.
"We are surprised. The agency's letter is disappointing and puzzling in light
of our collaboration with FDA and leading cancer pain experts during the past
four years in the Actiq clinical program. Also, it's surprising in the context
of the FDA Advisory Committee's September 17, 1997 unanimous vote (19 to 0)
that the benefits of Actiq for the intended cancer patient population outweigh
the product's risks", said William C. Moeller, chief executive officer.
Not approvable letters are issued by the FDA for a variety of reasons and set
the stage for the applicant and the FDA to discuss what further steps need to be
taken before the NDA can be approved. These steps usually involve additional
review of data and the production of other information by the sponsor. With the
November 13 letter, FDA has drawn attention to issues relating to clinical
results, data analysis, manufacturing information and the company's proposed
risk management plan.
The company believes FDA's medical and statistical review of the clinical trials
data presented to the Advisory Committee was supportive of the product for the
intended cancer patient population. At the Advisory Committee meeting,
patients, physicians, nurses and others speaking on behalf of cancer patients
expressed their view that Actiq is very much needed by cancer patients who
frequently do not have their pain adequately treated.
"Anesta continues to believe that the clinical studies using Actiq were well
designed, well conducted and demonstrated safety and efficacy in treating
breakthrough pain in cancer patients who were already receiving opioid
analgesic therapy," stated Thomas B. King, president and chief operating
officer. Anesta believes the clinical program for Actiq included the first
controlled clinical trials in the management of breakthrough pain in cancer
patients.
(more)
<PAGE> 2
EXHIBIT 99.1
ANESTA NEWS RELEASE
PAGE TWO
- --------------------------------------------------------------------------------
"Breakthrough pain is a common condition which has a major impact on cancer
patients' quality of life. There is a significant need for additional
therapies that have been specifically developed for breakthrough pain and
studied in the cancer pain population," stated Russell Portenoy, M.D.,
Chairman, Department of Pain Medicine and Palliative Care, Beth Israel Medical
Center, New York. "With improved management of breakthrough pain, the overall
outcome of cancer pain therapy would certainly improve."
"We reiterate our ongoing commitment to work with FDA to reach resolution of
the outstanding issues and we expect to meet with the agency shortly toward
that end", said Mr. King. "We are committed to achieving appropriate labeling,
educational programs and other risk management steps that are important to
minimize the potential for accidental misuse in inappropriate populations."
Abbott Laboratories is Anesta's licensed marketing and manufacturing partner
for both Actiq and Fentanyl Oralet(R) in the United States. Fentanyl Oralet was
Anesta's first product, and is cleared for marketing by the FDA for use in
surgical premedication and for sedation/analgesia prior to diagnostic or
therapeutic procedures in hospital monitored settings. Other products in
clinical development using Anesta's oral transmucosal system for drug delivery
include OT-nicotine for smoking cessation and OT-etomidate for short-acting
sedation in an outpatient setting.
Except for the historical information contained herein, this news release
contains forward-looking statements that involve risks and uncertainties.
Future events, including the outcome of the review of the Actiq NDA, may differ
materially from those discussed in this press release. While in many cases a
not approvable letter is a mechanism to resolve outstanding issues on a drug
under review, there can be no assurance that such a resolution can be reached
with regard to Actiq. Factors beyond the company's control that could prevent
such resolution include the nature of information requested by the FDA and the
FDA's interpretation of such information. The timing and scope of any FDA
approval of Actiq, if and when the FDA approves the Actiq NDA, will have a
material impact on the company and its prospects. Additional risks associated
with the FDA review process and the company's business are more fully described
in the company's filings with the SEC, including its Report on Form 10-K for
the year ended December 31, 1996 and its Prospectus dated June 6, 1996.
Available on the Anesta homepage at http://www.anesta.com.
####
