Polydex Pharmaceuticals Issues Interim Report on Business Operations

TORONTO, Feb. 7, 2007 -- Polydex Pharmaceuticals Limited (NASDAQ:POLXF) George Usher, President and CEO of Polydex Pharmaceuticals Limited, issued the following interim report on the state of the business operations of the Company. After the recent sudden halt of the Ushercell clinical trials, our management felt that this message should be imparted to shareholders at this time.

The cancelled trial status has not impacted the Company’s existing sales or revenue, nor has it affected our daily business operations.

The state of our business operations remains strong. Sales and revenue have been growing in recent years. We have worked on reducing our operating expenses and increasing margins during this period as well. Demand for our core products is steadily rising and we continue to explore additional business opportunities.

Refurbishment of the plant is well underway, and we anticipate that completed improvements could result in increased revenue before the end of fiscal 2007. We intend to meet this challenge with determination and a clear objective to demonstrate our core strengths in the manufacture and export of raw materials, as we have been doing since 1969.

In December of 2006, the Company reported $1.6 million in cash and cash equivalents at the end of the third quarter for fiscal 2006, being October 31, 2006. It also reported Sales for the nine-month period preceding of $4,656,581, Assets of $10,228,871, and Liabilities (including debt) of $2,432,961.

Over the next several months, our Scientific Advisory Board will be looking into the other potential research projects in our pipeline to determine the future course of R&D concepts. As well, once we have clarification of Ushercell’s activity from the Independent Data Monitoring Committee, we can determine the best course of developing Ushercell as a safe and effective contraceptive, and for other potential uses.

The Ushercell trials were halted in an immediate ethical response to preliminary findings by an Independent Data Monitoring Committee (IDMC) of an unexpected rate of HIV sero-conversion among participants at some sites. The preliminary findings are now under review for clarification of the data, which may also prove to be very useful in the continued development of future microbicide candidates. The Company will not be drawing conclusions based on unsubstantiated reports in the press or otherwise surrounding the closure of these trials, but instead will await further comments by IDMC on the review of their preliminary findings.

Everyone at Polydex is deeply concerned for the participants in this trial, and moved by their individual and shared brave commitments to advancing research into HIV prevention options. There are millions of women all over the world facing the risk of HIV infection every day and the continued pursuit of safe and effective microbicide candidates remains a noble quest.

Polydex Pharmaceuticals Limited, based in Toronto, Ontario, Canada, is engaged in the research, development, manufacture and marketing of biotechnology-based products for the human pharmaceutical market, and also manufactures bulk pharmaceutical intermediates for the worldwide veterinary pharmaceutical industry.

Please visit the Company’s website: www.Polydex.com .

Note: This press release may contain forward-looking statements, within the meaning of the United States Securities Act of 1933, as amended, and the United States Securities Exchange Act of 1934, as amended, regarding Polydex Pharmaceuticals Limited, including, without limitation, statements regarding expectations about future revenues or business opportunities and developments relating to Ushercell or other potential research projects. These statements are typically identified by use of words like “may”, “could”, “might”, “expect”, “anticipate” or similar words. Actual events or results may differ materially from the Company's expectations, which are subject to a number of known and unknown risks and uncertainties including but not limited to changing market conditions, future actions by the United States Food and Drug Administration or equivalent foreign regulatory authorities as well as results of pending or future clinical trials. Other risk factors discussed in the Company's filings with the United States Securities and Exchange Commission may also affect the actual results achieved by the Company.

Contact for Polydex Pharmaceuticals Limited: Linda Hughes, 1-877-945-1621, ( Linda@northarm.com)


 

Posted: February 2007


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