updated 5/13/2011 9:16:49 AM ET 2011-05-13T13:16:49

SAN MATEO, Calif., May 13, 2011 (GLOBE NEWSWIRE) -- Talon Therapeutics, Inc. (OTCBB:TLON), today reported financial results for the first quarter ended March 31, 2011.

"Our primary focus for the first three months of 2011 was the preparation of our NDA filing for Marqibo®," stated Steven R. Deitcher, M.D., President, Chief Executive Officer and Director of Talon Therapeutics. "I am pleased to report that significant progress has been made and the NDA is in an advanced stage of preparation."

Three Months Ended March 31, 2011 Unaudited Financial Results

For the three months ended March 31, 2011, the Company reported a net loss of $10.4 million and deemed dividends on preferred stock of $1.0 million, which when combined, resulted in a net loss applicable to common stockholders of $11.4 million, or $0.53 per share. The deemed dividends on preferred stock contributed $0.04 per share to the total net loss applicable to common stockholders for the three months ended March 31, 2011. Contributing to the $10.4 million net loss was $2.4 million in charges related to the change in fair value of the right to purchase future shares of preferred stock, held by existing preferred stockholders. This compares with a net loss of $5.5 million, or a loss per share of $0.27, for the three months ended March 31, 2010. There were no deemed dividends on preferred stock and no charges for the right to purchase future shares of preferred stock for the three months ended March 31, 2010.

Total operating expenses for the three months ended March 31, 2011 were $6.6 million, compared with $4.4 million for the three months ended March 31, 2010. Research and development expenses were $5.1 million for the three months ended March 31, 2011, compared with $3.3 million for the three months ended March 31, 2010. General and administrative expenses were $1.5 million for the three months ended March 31, 2011, compared with $1.2 million for the three months ended March 31, 2010.

As of March 31, 2011, the Company had cash, cash equivalents and available-for-sale securities of $16.2 million. Cash used in operations was $6.3 million for the three months ended March 31, 2011.

The per share results for all periods have been adjusted to reflect the impact of the Company's 1-for-4 reverse stock split that occurred at the close of business on September 10, 2010.

About Marqibo (vincristine sulfate liposomes injection)

Marqibo is a novel, targeted Optisome™ encapsulated formulation product candidate of the FDA-approved anticancer drug vincristine. Talon has been primarily developing Marqibo for the treatment of adult, Philadephia chromosome negative (Ph-) acute lymphoblastic leukemia (ALL). A Phase 3 study of Marqibo has been initiated by the German High-Grade Non-Hodgkin's Lymphoma Study Group in adults (61-80 years of age) with newly-diagnosed Non-Hodgkin's Lymphoma. Patient treatment in this Phase 3 study is expected to begin prior to the end of 2011.

Vincristine, a microtubule inhibitor, is FDA-approved for ALL and is widely used as a single agent and in combination regimens for treatment for hematologic malignancies such as lymphomas and leukemias. Marqibo's encapsulation formulation is designed to provide prolonged circulation of the drug in the blood and accumulation at the tumor site. These characteristics are intended to increase the dose of vincristine delivered in a safe and effective manner. Talon plans to submit to the FDA a New Drug Application, or NDA, seeking accelerated approval of Marqibo in adult Ph- ALL, in second or greater relapse or that has progressed following two or more prior lines of anti-leukemia therapy, by the end of June 2011. Talon has received orphan drug and fast track designations for Marqibo for the treatment of adult ALL from the U.S. Food and Drug Administration. Marqibo has also received orphan drug designation in adult leukemia from the European Medicines Evaluation Agency.

About Talon Therapeutics

Talon Therapeutics, Inc. is a biopharmaceutical company dedicated to seizing upon medical opportunities, efficiently and expertly leading product candidates through clinical development, and transferring value to patients, patient care providers, shareholders, corporate partners, and employees.

In addition to Marqibo and Menadione Topical Lotion, the Company has additional pipeline opportunities some of which, like Marqibo, improve delivery and enhance the therapeutic benefits of well characterized, proven chemotherapies and enable high potency dosing without increased toxicity.

Additional information on Talon Therapeutics, Inc. can be found at www.talontx.com.

The Talon Therapeutics, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=3290

Forward-Looking Statement

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are often, but not always, made through the use of words or phrases such as "anticipates," "expects," "plans," "believes," "intends," and similar words or phrases. These forward-looking statements include without limitation, statements regarding the timing of planned regulatory filings relating to Marqibo, Talon's ability to obtain accelerated approval of Marqibo for the treatment of adult Ph- adult ALL, and the potential of Marqibo to replace existing therapies. Such statements involve risks and uncertainties that could cause Talon's actual results to differ materially from the anticipated results and expectations expressed in these forward-looking statements. These statements are based on current expectations, forecasts and assumptions that are subject to risks and uncertainties, which could cause actual outcomes and results to differ materially from these statements. Among other things, the timing of Talon's proposed submission of an NDA seeking accelerated approval of Marqibo is subject to the FDA's acceptance of its plans for a Phase 3 confirmatory trial of Marqibo; there can be no assurances that any of Talon's clinical and regulatory development efforts relating to Marqibo will be successful; that even if an NDA for Marqibo is accepted by the FDA, that it will be approved; that the data of the clinical trials of Marqibo will be sufficient to support approval by the FDA of an NDA for Marqibo; that the results of the clinical trials of Marqibo will support Talon's claims or beliefs concerning Marqibo's safety and effectiveness; and that Talon will be able to secure the additional capital necessary to fund its product development programs, including Marqibo, to completion, Talon's reliance on third-party researchers to develop its product candidates, and its lack of experience in developing and commercializing pharmaceutical products. Additional risks are described in the company's Annual Report on Form 10-K for the year ended December 31, 2010. Talon assumes no obligation to update these statements, except as required by law.

 
TALON THERAPEUTICS, INC.
 
CONDENSED BALANCE SHEETS
(In thousands)
(Unaudited)
 
  March 31,

2011
December 31,

2010
ASSETS    
Current assets:    
Cash and cash equivalents $ 9,170 $ 4,573
Available-for-sale securities 7,015 18,068
Prepaid expenses and other current assets 177 254
Total current assets 16,362 22,895
     
Property and equipment, net 125 97
Restricted cash 125 125
Other long-term assets 32  
Debt issuance costs 866 905
Total assets $ 17,510 $ 24,022
     
LIABILITIES AND STOCKHOLDERS' DEFICIT    
Current liabilities:    
Accounts payable and accrued liabilities $ 6,663 $ 6,052
Other short-term liabilities 2 2
Total current liabilities 6,665 6,054
     
Notes payable, net of discount 23,513 23,340
Other long-term liabilities 4 5
Investors' right to purchase future shares of Series A-1 and A-2 preferred stock 7,513 5,131
Warrant liabilities 1,171 713
     
Commitments and contingencies:    
Redeemable convertible preferred stock; $100 par value:    
10 million shares authorized, 0.4 million issued and outstanding at March 31, 2011 and December 31, 2010; aggregate liquidation value of $43.4 million and $42.4 million at March 31, 2011 and December 31, 2010, respectively 30,643 30,643
     
Stockholders' deficit:    
Common stock; $0.001 par value:    
350 million shares authorized, 21.2 million shares issued and outstanding at March 31, 2011 and December 31, 2010 21 21
Additional paid-in capital 119,505 119,242
Accumulated other comprehensive income 1 (16)
Accumulated deficit (171,526) (161,111)
Total stockholders' deficit (51,999) (41,864)
Total liabilities, redeemable convertible preferred stock and stockholders' deficit $ 17,510 $ 24,022
 
 
TALON THERAPEUTICS, INC.
 
CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(In thousands, except per share data)
(Unaudited)
 
  Three Months Ended
  March 31,
  2011 2010
Operating expenses:    
General and administrative $ 1,480 $ 1,171
Research and development 5,144 3,258
Total operating expenses 6,624 4,429
     
Loss from operations (6,624) (4,429)
     
Other expense:    
Interest expense (881) (1,084)
Other expense, net (70)
Change in fair value of warrant liabilities (458) 41
Change in fair value of investors' right to purchase future shares of Series A-1 and A-2 preferred stock (2,382)
Total other expense (3,791) (1,043)
     
Net loss $ (10,415) $ (5,472)
     
Deemed dividends attributable to preferred stock (941)
     
Net loss applicable to common stock (11,356) (5,472)
     
Net loss per share applicable to common stock, basic and diluted $ (0.53) $ (0.27)
     
Weighted average shares used in computing net loss per share, basic and diluted 21,243 19,946
     
Comprehensive loss:    
Net loss $ (10,415) $ (5,472)
Unrealized holdings gains (losses) arising during the period (59) 8
Less: reclassification adjustment for other-than-temporary impairment included in net loss 76
     
Comprehensive loss $ (10,398) $ (5,464)
CONTACT: Talon Therapeutics, Inc.
         
         Investor & Media Contacts:
         
         Investor Relations Team
         
         (650) 588-6641
         
         investor.relations@talontx.com

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