GTx posts losses; no news on drug data

The Commercial Appeal
February 20, 2008
By Daniel Connolly

Memphis drug company GTx Inc. reported a bigger loss for the fourth quarter on higher research spending and administrative costs, but hasn't yet provided the big updates on its experimental pharmaceutical programs that investors are waiting for.

The firm lost $12.8 million, or 36 cents per share, compared to a loss of $4.7 million, or 15 cents per share, in the year-ago quarter. Revenue was $1.9 million.

Analysts surveyed by Thomson Financial had expected a loss of $11.7 million or 34 cents per share, on revenue of 5.1 million.

GTx is sinking tens of millions of dollars into developing new drugs that it hopes could be international sales hits.

It's expected to release data soon on large-scale tests of two variations of its experimental drug Acapodene: a 20 milligram dose to prevent prostate cancer in high-risk men, and an 80 milligram dose to cut side effects related to a cancer treatment.

So far, the company has never earned a profit, but agreements with big pharmaceutical companies like French firm Ipsen and New Jersey-based Merck & Co. Inc. are signs that many think its research is promising.

These agreements have also brought the firm plenty of cash to continue its research programs for years. The Merck agreement, for instance, could potentially be worth more than half a billion dollars.

Analyst Eric Schmidt of Cowen & Co. said investors don't care at this point that GTx is losing money.

"Sometimes for development stage biotech companies, the more you lose, the better because you're enrolling patients in clinical trials," he said.

Analyst Joel Sendek with Lazard Capital Markets maintained his "buy" recommendation for GTx stock and said he expected data on Acapodene in March.

-- Daniel Connolly: 529-5296

GTx Inc.

CEO: Dr. Mitchell S. Steiner

Headquarters: 3 N. Dunlap

Employees: 115

Web site: gtxinc.com