Exhibit 99.1
FOR IMMEDIATE RELEASE
ENTROPIN REPORTS SUCCESSFUL SECONDARY OFFERING AND YEAR-END
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2003 FINANCIAL RESULTS
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INDIO, CALIF. (MARCH 11, 2004) - ENTROPIN, INC. (OTCBB: ETOP), a development
stage pharmaceutical company focused on the pain therapy market, today announced
the completion of a successful secondary stock offering and financial results
for the year-ended December 31, 2003.
COMPLETION OF STOCK OFFERING AND USE OF PROCEEDS
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The Company recently completed a stock offering with gross proceeds of
approximately $3,470,000 (including a 10% over-allotment) through the sale of
approximately 17,350,000 shares of its common stock. An additional $380,000 of
gross proceeds (representing an additional 1,900,000 shares of common stock) is
being held in escrow pending blue sky clearance in one state. The Company
intends to use the offering proceeds to:
o develop additional formulations of the Company's proprietary
ENT-103 compound;
o complete additional preclinical studies on ENT-103;
o prepare and file an investigational new drug application for
ENT-103;
o explore licensing agreement(s) with third party pharmaceutical
companies;
o commence a Phase I clinical trial for ENT-103 in early 2005.
Thomas G. Tachovsky, PhD, Entropin's President and Chief Executive Officer,
commented, "We are extremely pleased that our offering was so well received. We
reached our goal by completing the offering in less than thirty days and the
offering was significantly oversubscribed. The support from both existing and
new investors is gratifying. We also understand and take seriously the
requirements for building a commercially viable business for our investors."
ENT-103
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Over the past year, ENT-103 has emerged as the Company's primary prospect for
entering clinical trials. The potential market opportunities the Company may
pursue, should ENT-103 receive FDA approval, include treatment of pain resulting
from shingles.
In early preclinical tests, ENT-103 demonstrated characteristics that are unique
when compared to pain therapies currently on the market. Early tests indicate
that ENT-103 is effective as both an anesthetic and analgesic. Additionally,
ENT-103 formulated with a proprietary absorption enhancer and applied directly
to the skin, showed analgesic activity in a penetration-dependent fashion. We
believe this result indicates that ENT-103 can be successfully delivered through
the skin, a characteristic that may further expand market opportunities.
In our most recent tests in animal models, ENT-103 exceeded the performance of
lidocaine, the most widely used local anesthetic currently on market.
Specifically, we determined ENT-103 acts faster, lasts longer and reduces the
severity of inflammatory neurogenic pain better than lidocaine in animal models.
YEAR ENDED DECEMBER 31, 2003 COMPARED WITH 2002
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Net cash used in operating activities was approximately $2.7 million during
fiscal 2003, compared with approximately $4.7 million during fiscal 2002. The
cash used in operations was primarily related to funding clinical trials,
conducting mechanism of action studies, expanding research and development
activities and maintaining our administrative infrastructure. As of December 31,
2003, our principal source of liquidity was approximately $1,032,000 in cash and
cash equivalents.
The net loss for the year 2003 was approximately $3.3 million, or $0.31 per
basic and diluted share on approximately 10.7 million weighted average shares
outstanding. In comparison, the net loss for the year 2002 was approximately
$5.4 million, or $0.54 per share on approximately 9.9 million weighted average
shares outstanding. Research and development expenses were approximately
$723,000 for 2003, as compared to approximately $3.0 million for 2002. The
decrease in net loss and in research and development expenses during 2003
compared with 2002 reflects the fact that the Company was actively involved in
clinical trials during much of 2002. Clinical trials are generally more costly
than the preclinical research the Company was pursuing during 2003.
General and administrative expenses were approximately $2.4 million for both
2003 and 2002. Although general and administrative expenses were approximately
equal for 2003 and 2002, the composition of these expenses differed. The 2003
expenses included increased legal fees and higher directors and officers'
liability insurance premiums attributable to the class action suit filed against
the Company in early 2003. The 2002 expenses included greater expenses for
investor relations and financial/business consultants.
Our interest income was approximately $23,000 in 2003, as compared to
approximately $190,000 in 2002. This decrease reflects lower balances and
declining interest rates for cash, cash equivalents and short-term investments
during 2003.
ABOUT ENTROPIN
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Entropin, Inc. is a pharmaceutical research and development company focused on
the development of its proprietary compounds as potent therapy for pain.
Preclinical work shows that several of these compounds effectively block nerve
impulse conduction, have potentially long-lasting properties to reduce and
manage pain, and may also be effective in relieving both primary and secondary
hyperalgesia (pain hypersensitivity) caused either by injury or incision.
Investor Relations Contact:
Navidec, Inc.
(303) 222-1000
entropin@navidec.com
STATEMENTS IN THIS PRESS RELEASE THAT ARE NOT STRICTLY HISTORICAL MAY BE
"FORWARD-LOOKING" STATEMENTS, WHICH INVOLVE RISKS AND UNCERTAINTIES. NO
ASSURANCES CAN BE GIVEN, FOR EXAMPLE, THAT THE COMPANY WILL SUCCESSFULLY DEVELOP
ITS CURRENT PRODUCTS, OR ANY NEW PRODUCTS IT MAY PURSUE, RAISE ADDITIONAL
CAPITAL, COMPLETE CLINICAL TRIALS, OBTAIN REGULATORY APPROVALS, OR BE ABLE TO
MANUFACTURE OR SUCCESSFULLY COMMERCIALIZE SUCH PRODUCTS. ACTUAL RESULTS MAY
DIFFER MATERIALLY FROM THOSE DESCRIBED IN THIS RELEASE DUE TO RISKS AND
UNCERTAINTIES THAT EXIST IN THE COMPANY'S OPERATIONS, INCLUDING, WITHOUT
LIMITATION, THE ABILITY TO SUCCESSFULLY COMPLETE DEVELOPMENT AND
COMMERCIALIZATION OF PRODUCTS, INCLUDING THE COST, SCOPE AND RESULTS OF
PRECLINICAL AND CLINICAL TESTING, THE ABILITY TO SUCCESSFULLY COMPLETE PRODUCT
RESEARCH AND FURTHER DEVELOPMENT, INCLUDING PRECLINICAL AND CLINICAL STUDIES,
THE TIME, COST AND UNCERTAINTY OF OBTAINING REGULATORY APPROVALS, THE ABILITY TO
OBTAIN SUBSTANTIAL ADDITIONAL FUNDING, THE ABILITY TO DEVELOP AND COMMERCIALIZE
PRODUCTS BEFORE COMPETITORS AND OTHER FACTORS DETAILED FROM TIME TO TIME IN
FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION INCLUDING, WITHOUT
LIMITATION, THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB FOR THE MOST RECENT
FISCAL YEAR END AND THE COMPANY'S MOST RECENT FORM 10-QSB. THE COMPANY
UNDERTAKES NO OBLIGATION TO RELEASE PUBLICLY THE RESULTS OF ANY REVISION TO
THESE FORWARD-LOOKING STATEMENTS TO REFLECT EVENTS OR CIRCUMSTANCES ARISING
AFTER THE DATE HEREOF.
--FINANCIAL TABLES FOLLOW--
ENTROPIN, INC.
(A Development Stage Company)
CONDENSED BALANCE SHEETS
(UNAUDITED)
ASSETS December 31, December 31,
2003 2002
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Current Assets:
Cash and Cash Equivalents $ 1,032,343 $ 2,906,853
Short-term Investments -- 990,000
Other Current Assets -- 5,954
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Total Current Assets 1,032,343 3,902,807
Other Assets 563,918 425,977
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TOTAL ASSETS
$ 1,596,261 $ 4,328,784
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities $ 208,456 $ 62,450
Redeemable Preferred Stock -- 3,923,034
Stockholders' Equity:
Common Stock 1,154 991
Redeemable Preferred Stock 3,210,487 --
Additional Paid-in Capital 30,871,699 29,801,165
Deficit Accumulated During the Development Stage (32,695,535) (29,386,377)
Unearned Stock Compensation -- (72,479)
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Total Stockholders' Equity 1,387,805 343,300
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
$ 1,596,261 $ 4,328,784
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ENTROPIN, INC.
(A Development Stage Company)
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
For the years ended
December 31,
2003 2002
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OPERATING COSTS AND EXPENSES
Research and Development $ 723,218 $ 3,048,063
General and Administrative 2,418,286 2,403,835
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Operating Loss (3,141,504) (5,451,898)
Series B Preferred Stock Redemption Conversion Incentive (126,310) --
Other Income 22,906 190,102
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NET LOSS (3,244,908) (5,261,796)
Dividends Applicable to Series B Preferred Stockholders (35,039) (91,033)
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NET LOSS APPLICABLE TO COMMON STOCKHOLDERS $ (3,279,947) $ (5,352,829)
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Basic and Diluted Net Loss Per Common Share $ (0.31) $ (0.54)
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Weighted Average Common Shares Outstanding 10,695,000 9,874,000
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