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Press release from Marketwire

Trimel Announces Fourth Quarter and Year-End 2012 Financial Results

Monday, March 25, 2013

Trimel Announces Fourth Quarter and Year-End 2012 Financial Results17:05 EDT Monday, March 25, 2013TORONTO, ONTARIO--(Marketwire - March 25, 2013) - Trimel Pharmaceuticals Corporation (TSX:TRL) ("Trimel" or "the Company") today reported its financial results for the three and twelve month periods ended December 31, 2012. Financial Results for the Three and Twelve Months Ended December 31, 2012 For the three and twelve month periods ended December 31, 2012, Trimel incurred Research and Development expenses ("R&D") of US$3.9 million and US$16.5 million respectively as compared to US$2.2 million and US$13.2 million for the comparable 2011 periods. The increase in R&D spending for the 2012 period relates primarily to the costs associated with the advancement of the CompleoTRT™ Phase III and Tefina™ Phase II clinical trials. Trimel incurred General and Administrative expenses of US$3.3 million and US$10.9 million for the three and twelve month periods ended December 31, 2012 respectively as compared to US$2.7 million and US$8.4 million for the comparable 2011 periods. The increase in spending for the 2012 period(s) as compared to spending levels for the same 2011 period(s) was primarily attributable to employment related expenses and legal fees related to intellectual property and arbitration matters. For the three and twelve month periods ended December 31, 2012, the Company incurred a net loss of US$0.09 and US$0.32 per share respectively, as compared to US$0.06 and US$0.39 per share for the comparable 2011 periods. As at December 31, 2012, the Company had total assets of US$16.9 million as compared to US$25.3 million at September 30, 2012 and total liabilities of US$12.2 million at December 31, 2012 as compared to US$13.7 million at September 30, 2012. The information set out above is in summary form. Readers are encouraged to review the Company's annual information form, financial statements (and accompanying notes), together with management's discussion and analysis available on SEDAR at and on the Company's website at Form Preliminary Prospectus As previously announced, the Company has filed a preliminary short form prospectus in connection with a proposed marketed offering of units, each unit consisting of one common share of the Company and one-half of one common share purchase warrant. The common shares forming a part of the units will be comprised of a combination of common shares issued by the Company and common shares sold by Mr. Eugene Melnyk. The warrants forming a part of the units will all be warrants issued by the Company. Mr. Melnyk will receive the net proceeds from the sale of common shares sold by him. The Company will receive the net proceeds from the sale of common shares and warrants issued by the Company. Further information with respect to the Company and the proposed offering is set out in the preliminary short form prospectus of the Company dated March 20, 2013, available on SEDAR at Trimel: Trimel Pharmaceuticals Corporation (TSX:TRL) - Trimel is a specialty pharmaceutical company actively developing medications for male hypogonadism, female sexual dysfunction and various respiratory disorders. CompleoTRT™, a product utilizing Trimel's licensed bioadhesive intranasal gel technology, has successfully completed its pivotal Phase III study for the treatment of male hypogonadism, a condition commonly referred to as "Low T", and Trimel is preparing to file its New Drug Application with the FDA in the second quarter of 2013. For more information, please visit Notice regarding forward-looking statements: Information in this press release that is not current or historical factual information may constitute forward looking information within the meaning of securities laws. Implicit in this information, are assumptions regarding our future operational results. These assumptions, although considered reasonable by the Company at the time of preparation, may prove to be incorrect. Readers are cautioned that actual performance of the Company is subject to a number of risks and uncertainties, and could differ materially from what is currently expected as set out above. For more exhaustive information on these risks and uncertainties you should refer to our preliminary short form prospectus dated March 20, 2013 which is available at Forward-looking information contained in this press release is based on our current estimates, expectations and projections, which we believe are reasonable as of the current date. You should not place undue importance on forward-looking information and should not rely upon this information as of any other date. While we may elect to, we are under no obligation and do not undertake to update this information at any particular time, whether as a result of new information, future events or otherwise, except as required by applicable securities law.TRIMEL PHARMACEUTICALS CORPORATIONCONSOLIDATED STATEMENT OF FINANCIAL POSITIONAS AT DECEMBER 31, 2012 AND DECEMBER 31, 2011(expressed in U.S. Dollars)ASSETS20122011CURRENTCash$9,216,999$14,528,625Other receivables72,20974,304Prepaids and other assets1,023,047276,57810,312,25514,879,507NON-CURRENT ASSETSRestricted cash25,128-Property and equipment, net3,026,1603,508,194Intangible assets3,562,6003,858,400TOTAL ASSETS$16,926,143$22,246,101LIABILITIESCURRENTAccounts payable and accrued liabilities$4,802,114$3,207,507Provisions42,494417,378Income taxes payable-74,611Current portion of capital lease obligation140,551393,807Current portion of long-term debt, net of issuance costs2,425,562-7,410,7214,093,303LONG-TERMCapital lease obligation-137,497Deferred tax liability-56,953Long-term debt, net of issuance costs4,561,686-Derivative financial instrument203,248-TOTAL LIABILITIES12,175,6554,287,753SHAREHOLDERS' EQUITYShare capital78,214,66167,430,241Warrants3,452,6072,413,367Contributed surplus4,318,9271,610,972Accumulated other comprehensive income362,92078,682Deficit(81,598,627)(53,574,914)TOTAL SHAREHOLDERS' EQUITY4,750,48817,958,348TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$16,926,143$22,246,101TRIMEL PHARMACEUTICALS CORPORATIONCONSOLIDATED STATEMENT OF LOSS AND COMPREHENSIVE LOSSFOR THE YEARS ENDED DECEMBER 31, 2012 AND 2011(expressed in U.S. Dollars)20122011EXPENSESResearch and development, net of refundable tax credits$16,522,603$13,229,964General and administrative10,896,7468,440,763Total operating expenses27,419,34921,670,727FINANCE COSTS, NETAccretion of long-term debt28,5731,672,859Interest on long-term debt and other financing costs606,674737,407Interest income(14,060)(160,327)Change in fair value of derivative financial instrument94,158-715,3452,249,939REORGANIZATION AND OTHER COSTS-2,085,751TOTAL EXPENSES28,134,69426,006,417LOSS BEFORE INCOME TAXES(28,134,694)(26,006,417)PROVISION FOR (RECOVERY OF) INCOME TAXESCurrent(53,036)348,090Deferred(57,945)23,817(110,981)371,907NET LOSS$(28,023,713)$(26,378,324)OTHER COMPREHENSIVE LOSS, NET OF INCOME TAXForeign currency translation adjustment284,23878,682TOTAL COMPREHENSIVE LOSS FOR THE YEAR$(27,739,475)$(26,299,642)Basic and Diluted Weighted Average Shares Outstanding86,633,08267,019,568Basic and Diluted Net Loss per Common Share$(0.32)$(0.39)TRIMEL PHARMACEUTICALS CORPORATIONCONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (DEFICIENCY)FOR THE YEARS ENDED DECEMBER 31, 2012 AND 2011(expressed in U.S. Dollars)Share capitalWarrantsDebt conversion optionContributed surplusAccumulated other comprehensive incomeDeficitTotalBalance, January 1, 2011$4,252,937$-$3,609,798$916,912$-$(27,196,590)$(18,416,943)Net loss for the year-----(26,378,324)(26,378,324)Cumulative translation adjustment----78,682-78,682Total comprehensive loss for the year----78,682(26,378,324)(26,299,642)Issuance of Class A shares and warrants, net of issuance costs28,666,6122,413,367----31,079,979Equity portion of convertible debt issued--141,571---141,571Conversion of convertible debt33,222,160-(3,751,369)---29,470,791Share issuance in amalgamation transaction1,288,532-----1,288,532Share based compensation---694,060--694,060Balance as at December 31, 2011$67,430,241$2,413,367$-$1,610,972$78,682$(53,574,914)$17,958,348Balance, January 1, 2012$67,430,241$2,413,367$-$1,610,972$78,682$(53,574,914)$17,958,348Net loss for the year-----(28,023,713)(28,023,713)Cumulative translation adjustment----284,238-284,238Total comprehensive loss for the year----284,238(28,023,713)(27,739,475)Unit issuance in public offering, net of issuance costs10,728,7221,002,882----11,731,604Broker warrants issued as part of long-term debt-36,823----36,823Conversion of warrants5,698(465)----5,233Conversion of options50,000-----50,000Share based compensation---2,707,955--2,707,955Balance as at December 31, 2012$78,214,661$3,452,607$-$4,318,927$362,920$(81,598,627)$4,750,488TRIMEL PHARMACEUTICALS CORPORATIONCONSOLIDATED STATEMENT OF CASH FLOWSFOR THE YEARS ENDED DECEMBER 31, 2012 AND 2011(expressed in U.S. Dollars)20122011CASH FLOWS FROM OPERATING ACTIVITIESNet loss for the year$(28,023,713)$(26,378,324)Items not requiring an outlay of cash:Amortization of intangible assets295,800295,800Depreciation of property and equipment687,890555,220Accretion of long-term debt28,5731,672,859Amortization of deferred financing costs153,386-Broker warrants issued36,823-Interest expense414,771737,407Change in fair value of derivative financial instrument94,158-Share based compensation2,707,955694,060Reorganization and other costs-2,085,751Loss on property and equipment1,88943,333Deferred income tax provision(57,945)23,817Income tax provision(53,036)348,090Other-(11,748)Net changes in non-cash working capital items related to operating activities:Other receivables3,494175,092Accounts payable and accrued liabilities1,490,869871,452Prepaids and other assets(737,871)(77,784)Provisions(382,357)309,900Income taxes received (paid)(22,876)(357,475)(23,362,190)(19,012,550)CASH FLOWS FROM FINANCING ACTIVITIESProceeds from issuance of Class A shares and warrants, net of issuance costs-31,079,979Proceeds from issuance of common shares and warrants, net of financing costs11,731,604-Proceeds from issuance of convertible debt-2,399,900Proceeds from long-term debt financing, net of financing costs6,914,379-Proceeds from exercise of warrants5,233-Proceeds from exercise of options50,000-Payment of capital lease obligations(400,669)(175,957)Interest paid(346,419)(16,456)17,954,12833,287,466CASH FLOWS FROM INVESTING ACTIVITIESAcquisition of property and equipment(136,941)(527,699)Proceeds from sale of fixed assets2,833-Restricted cash(25,128)-(159,236)(527,699)NET (DECREASE)/INCREASE IN CASH FOR THE YEAR(5,567,298)13,747,217Exchange gain on cash255,672(5,426)CASH, BEGINNING OF THE YEAR14,528,625786,834CASH, END OF THE YEAR$9,216,999$14,528,625FOR FURTHER INFORMATION PLEASE CONTACT: Contact Information: Trimel Pharmaceuticals CorporationKenneth G. HowlingChief Financial Officer416 679