SkyePharma: No 'fundamental reason' for decline in share price; expects to sell injectables business by year end

By E. Janene Geiss

Philadelphia, Aug. 11 - SkyePharma plc said Friday that it was not aware of any fundamental reason for the recent decline in the company's share price and added that it expects to sell its injectables unit by the end of the year.

"We are disappointed by the fall in our share price over the past few weeks. We are continuing our efforts to deliver on the strategy outlined earlier this year to divest our injectable unit and to out-license Flutiform outside the United States and we remain confident that we will be able to achieve these objectives," Frank Condella, SkyePharma's chief executive officer, said in the release.

The company's stock closed at 22.50p on Thursday, down 0.25p on the day and well below the level in the low 30s in late June and around 36p in May.

Earlier this year, the board decided to divest the injectables unit, a stand-alone operation with its own management team, research and development and manufacture in San Diego.

UBS, the investment bank appointed for this disposal, is managing the process, officials said.

Discussions are continuing with interested parties and also with companies that have expressed an interest in DepoBupivacaine alone or in other assets.

The company said it is progressing with several options, all of which are geared towards bringing in cash and reducing the ongoing cash burn.

The company said it expects to complete a transaction before the end of the year.

For key pipeline products, the phase 3 trials of Flutiform are proceeding and remain on track for the company's target of filing this key product with the Food and Drug Administration in the second half of 2007.

SkyePharma noted the FDA's recent approval of AstraZeneca's combination asthma product Symbicort. The company said it is encouraged by the FDA's recent approval of AstraZeneca's combination asthma product Symbicort.

The speed with which this product was reviewed and approved increases SkyePharma's confidence that its expectation of a U.S. market launch for Flutiform in 2009 is reasonable or possibly conservative.

The company also said it is engaged in late-state negotiations for Flutiform licensees in key markets. It recently appointed Kos Pharmaceuticals as the licensee for Flutiform in the United States, officials said.

With its partner Novartis, the company said it has successfully completed modifications to its dry powder inhaler device to prevent mishandling that it is hoped will allow Foradil Certihaler to be returned to the market in Europe and to obtain approval in the United States. The modified product is currently being reviewed by the FDA and a decision is expected before the end of the year, officials said.

SkyePharma is a London pharmaceutical company.

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