Osiris Therapeutics takes 2Q loss as payments fall

COLUMBIA, Md. (AP) -- Osiris Therapeutics Inc. said Monday it took a loss in the second quarter, but the company received the first two marketing approvals for its stem cell therapy Prochymal.

The company reported greater sales of its biosurgery products in the second quarter. However in the second quarter of 2011, Osiris turned a profit after recognizing more than $10 million in royalty payments and revenue from collaborative research and development agreements.

Osiris said it took a loss of $4.3 million, or 13 cents per share. A year ago it reported net income of $1.8 million, or 5 cents per share. Product revenue rose to $1.6 million from $130,000, but revenue from royalty payments and research and development collaborations declined to $98,000 from $10.2 million.

Analysts expected Osiris to report a loss of 15 cents per share and revenue of $1.6 million, according to FactSet.

Osiris said in May that Canadian regulators granted conditional approval to Prochymal. The therapy is used to treat graft vs. host disease, a condition in which transplanted bone marrow cells attack the body of the patient. Regulators in New Zealand gave full approval to Prochymal in June. The Food and Drug Administration has not approved Prochymal, but patients can get the treatment under certain conditions.

Almost all of Osiris' revenue in the latest quarter came from sales of stem cell biosurgery products like Grafix and Ovation. Grafix is applied to acute and chronic wounds like burns or diabetic foot ulcers to promote healing, and Ovation is used in orthopedic procedures.

The company also reported lower expenses for research and development and other costs.

Shares of Osiris Therapeutics fell 76 cents, or 7.6 percent, to $9.27 in morning trading.

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Osiris Therapeutics takes 2Q loss as payments fall