Senomyx Quarterly Revenue Increases 3%
Revenues were $4.2 million for the third quarter of 2009, compared to $4.0 million for the third quarter of 2008, an increase of 3%. As of September 30, 2009, the Company had cash, cash equivalents, and short term investments of approximately $33 million.
6 Nov 2009 --- Senomyx, Inc., a company focused on using proprietary taste receptor-based technologies to discover novel flavor ingredients for the food, beverage, and ingredient supply industries, provided a corporate update and reported financial results for the third quarter ended September 30, 2009. Revenues were $4.2 million for the third quarter of 2009, compared to $4.0 million for the third quarter of 2008, an increase of 3%. As of September 30, 2009, the Company had cash, cash equivalents, and short term investments of approximately $33 million. Subsequent to the quarter end Senomyx achieved a major goal with the receipt of a Generally Recognized As Safe (GRAS) regulatory designation for S6973, an enhancer of sucrose (table sugar) that has demonstrated the ability to reduce up to 50% of the sugar in diverse products while maintaining the taste of natural sugar. The GRAS status allows S6973 to be incorporated into specified products in the U.S. and in numerous other countries. “The receipt of a GRAS designation for S6973 is a landmark event for Senomyx,” stated Kent Snyder, Chief Executive Officer of the Company. “We believe it is a confirmation of Senomyx’s discovery, development, and regulatory capabilities that S6973 was awarded GRAS status for all of the uses and use levels requested. We are especially pleased to have completed development activities with S6973 and to be granted the GRAS designation for a large number of products earlier than originally anticipated.”
Senomyx had stated previously that its goal was to obtain a GRAS determination for S6973 by the end of the first quarter of 2010. As a result of extended efforts by the Company’s scientific and regulatory team, Senomyx was able to submit an application for the use of S6973 in a large number of product categories and receive the GRAS status almost two quarters ahead of the expected timeframe. The GRAS designation allows usage of S6973 in baked goods, cereals, gum, condiments and relishes, confectioneries and frostings, frozen dairy offerings, fruit ices, gelatins and puddings, hard and soft candy, jams and jellies, milk products, and sauces.
In August 2009 Senomyx and Firmenich SA, the world's largest privately-owned fragrance and flavor company, announced that the two companies entered into a collaborative research, development, commercialization and license agreement related to Senomyx’s Sweet Enhancers, which are novel flavor ingredients intended to enhance the taste of sucrose, fructose, and Rebaudioside (stevia). The agreement provides that during the collaborative period Firmenich will have exclusive rights to commercialize selected Senomyx Sweet Enhancers worldwide in virtually all food product categories not currently licensed to other companies. In return, Firmenich agreed to pay to Senomyx shared funding of ongoing research, license fees, and royalties on sales of Senomyx’s Sweet Enhancers developed under the collaboration. Senomyx received an initial license fee payment of $10 million from Firmenich following execution of the agreement.
As previously announced, a second $10 million license fee is payable to Senomyx following Firmenich’s decision to commercialize a Senomyx Sweet Enhancer that has received regulatory approval. The companies have agreed that Firmenich will conclude its evaluation and make a determination in February 2010 regarding whether it will select S6973 for commercial development. Based on its encouraging evaluation thus far, Firmenich will pay to Senomyx in November 2009 a non-refundable $2 million payment as part of the second license fee. The remaining $8 million portion of the second license fee will be due to Senomyx upon Firmenich’s decision to proceed with commercial development of S6973. If Firmenich does not proceed with S6973, the remaining $8 million will be due at the time Firmenich decides to proceed with commercial development of any other Sweet Enhancer covered under the agreement that receives regulatory approval.
“The global sucrose market has in excess of $50 billion in annual purchases, with a large range of products that utilize sucrose,” noted John Poyhonen, Senomyx’s President and Chief Operating Officer. “We believe the numerous products for which S6973 has been granted GRAS status are a valuable segment of this market and represent a large commercial opportunity for our novel sucrose enhancer. S6973 is intended to allow food and beverage companies to offer appealing lower-calorie products that may have a nutritional benefit for their customers, and in some product categories it may also provide a cost of goods benefit.
“In order to address other types of products that use sugar, Senomyx is evaluating S6973 for potential future GRAS determination in additional categories,” Poyhonen said. “As discussed previously, we are also continuing to assess several promising new sucrose enhancers with desirable physical properties that may be advantageous for an even wider variety of applications, including a range of beverages.”
Senomyx is also pleased to report that Ajinomoto Co., Inc., a leading global manufacturer of food and culinary products, has begun the initial commercial introduction of products that contain a Senomyx flavor ingredient. The first product marketed is an ingredient mix being introduced in China. Senomyx anticipates that Ajinomoto’s commercial activities will expand to additional offerings and countries over time.
Senomyx is also continuing to make progress with other aspects of the Company’s flavor programs and to increase the number of granted patents in its intellectual property portfolio. As of September 30, 2009, Senomyx is the owner or exclusive licensee of 176 issued patents and 427 pending patent applications related to proprietary taste receptor technologies in the U.S., Europe, and elsewhere.
