Verastem, Inc. Reports First Quarter 2012 Financial Results

CAMBRIDGE, Mass.--(BUSINESS WIRE)--

Verastem, Inc., (NASDAQ: VSTM - News) a biopharmaceutical company focused on discovering and developing drugs to treat breast and other cancers by targeting cancer stem cells, today reported financial results for the quarter ended March 31, 2012 and also commented on certain corporate accomplishments and plans.

"We continue to build value by progressing the discovery and development of drugs targeting cancer stem cells and adding key advisors," said Christoph Westphal, M.D., Ph.D., Chairman, President and Chief Executive Officer of Verastem, Inc. "Henri Termeers insight and extensive experience has been a great asset to Verastem. As Lead Director, Henri will play an integral role in guiding Verastems vision for the next generation of cancer treatments. The addition of Dr. Max Wicha to our Scientific Advisory Board adds significant expertise in translational medicine which will shape our programs as we progress towards clinical development over the next 12 months.

Recent Accomplishments

Our significant recent accomplishments include the following:

First Quarter 2012 Financial Results

As of March 31, 2012, Verastem had cash, cash equivalents, short-term investments and long-term investments of $109.3 million compared to $56.8 million on December 31, 2011.

Net loss for the three months ended March 31, 2012 (the 2012 Quarter) was $6.9 million, or $0.47 per share applicable to common shareholders, as compared to $1.2 million, or $1.06 per share, for the three months ending March 31, 2011 (the 2011 Quarter). Net loss includes stock-based compensation expense of $1.5 million and $54,000 for the 2012 Quarter and 2011 Quarter, respectively. Net loss for the 2012 Quarter includes a non-cash charge of $431,000 related to the revaluation of a warrant that we have agreed to issue to Poniard Pharmaceuticals, Inc. (Poniard) upon achievement of a milestone under a license agreement.

Research and development expense for the 2012 Quarter was $4.8 million compared to $675,000 for the 2011 Quarter. The $4.1 million increase from the 2011 Quarter to the 2012 Quarter principally resulted from an increase of $1.4 million in contract research organization expense, an increase of $1.4 million for personnel costs, including stock-based compensation of $856,000, an increase of $482,000 in license fee expense primarily related to the revaluation of a warrant that we have agreed to issue to Poniard upon achievement of a milestone and an increase of $315,000 for laboratory supplies.

General and administrative expense for the 2012 Quarter was $2.1 million compared to $471,000 for the 2011 Quarter. The $1.7 million increase from the 2011 Quarter to the 2012 Quarter principally resulted from an increase of $973,000 for personnel costs, including stock-based compensation of $620,000, an increase of $274,000 in professional fees primarily related to additional legal and accounting fees for being a publicly traded company, an increase of $157,000 in consulting fees and an increase of $96,000 in insurance primarily related to being a publicly traded company.

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Verastem, Inc. Reports First Quarter 2012 Financial Results