Hemispherx Biopharma Comments on 2005 BDO Audit News
According to a December 18, 2007, report titled, "Ex-BDO Seidman official penalized for lack of oversight," the former head of BDO Seidman's assurance practice in Philadelphia has been barred by the federal Public Company Accounting Oversight Board (PCAOB) from working with a public accounting firm for failing to review the audit work of a junior member of his firm and then trying to cover it up by backdating documents.
The PCAOB's actions are related to an audit of Hemispherx Biopharma's financial statements by BDO for fiscal years including 2004. According to PCAOB, BDO improperly authorized the release of BDO's audit report on Hemispherx's financial statements on March 16, 2005 because BDO lacked at the time the proper internal controls to opine on the audit's veracity.
In the ensuing reissuance process, the Company's restated financials actually improved; namely, fiscal 2004 showed a decrease in the net loss applicable to common stockholders of $3.2 million, or $0.07 per share, as compared to results reported in the earlier audit which lacked the proper internal controls within BDO.
BDO's final reports on financial statements of Hemispherx for the fiscal years ended December 31, 2004 and December 31, 2005 did not contain any adverse opinion or any disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope or accounting principles.
Thereafter, Hemispherx engaged McGladrey and Pullen, LLP as its independent registered accounting firm following the filing of its quarterly report on Form 10Q for the period ended Sept. 30, 2006.
About Hemispherx Biopharma
Hemispherx Biopharma, Inc. is an advanced biopharmaceutical company engaged in the manufacture and clinical development of new drug entities for treatment of seriously debilitating disorders. Hemispherx's flagship products include Alferon N Injection(R) (FDA approved for a category of sexually transmitted diseases) and the experimental therapeutics Ampligen(R) and Oragens(R). Ampligen(R) and Oragens(R) represent experimental RNA nucleic acids being developed for globally important debilitating diseases and disorders of the immune system. Hemispherx's platform technology includes large and small agent components for potential treatment of various severely debilitating and life threatening diseases. Hemispherx has in excess of 100 patents comprising its core intellectual property estate and a fully commercialized product (Alferon N Injection(R)). The Company wholly owns and exclusively operates a GMP certified manufacturing facility in the United States for commercial products. For more information please visit http://www.hemispherx.net.
Information contained in this news release other than historical information, should be considered forward-looking and is subject to various risk factors and uncertainties. For instance, the strategies and operations of Hemispherx involve risk of competition, changing market conditions, change in laws and regulations affecting these industries and numerous other factors discussed in this release and in the Company's filings with the Securities and Exchange Commission. Any specifically referenced investigational drugs and associated technologies of the Company (including Ampligen(R), Alferon LDO and Oragens) are experimental in nature and as such are not designated safe and effective by a regulatory authority for general use and are legally available only through clinical trials with the referenced disorders. The forward-looking statements represent the Company's judgment as of the date of this release. The Company disclaims, however, any intent or obligation to update these forward-looking statements. Clinical trials for other potential indications of the approved biologic Alferon N Injection(R) do not imply that the product will ever be specifically approved commercially for these other treatment indications.
Hemispherx Biopharma, Inc.
Dianne Will, 518-398-6222
CCG Investor Relations
Sean Collins, 310-477-9800
Posted: December 2007