TORONTO, Nov. 12, 2014 /PRNewswire/ - Transition Therapeutics Inc. ("Transition" or the "Company") (TSX: TTH; NASDAQ: TTHI), a biopharmaceutical development company advancing novel therapeutics for CNS and metabolic disease indications, today announced its financial results for the three month period ended September 30, 2014.

Selected Highlights

Highlights for the Company during the three month period ended September 30, 2014 and up to the date of this press release include the following:

ELND005:


    --  November 4, 2014 - Transition announced findings from a Phase 2 study of
        neuropsychiatric drug candidate, ELND005, as an adjunctive maintenance
        treatment for bipolar disorder type I patients (BPD). Transition's
        wholly-owned subsidiary, Transition Therapeutics Ireland Limited
        ("TTIL") terminated the bipolar disorder Phase 2 study on April 7, 2014
        for business reasons. TTIL has completed a review of the data from this
        bipolar disorder Phase 2 study. Overall, ELND005 had an acceptable
        safety and tolerability profile in the study, and showed numerical
        differences in the number of mood event recurrences favoring ELND005.

TT401:


    --  Transition has paid two of three installment payments totaling US$10
        million to diabetes drug candidate development partner Lilly upon the
        achievement of 50% patient enrollment for the currently on-going Phase 2
        clinical trial in type 2 diabetic patients.

Corporate Developments:


    --  July 11, 2014 - Transition announced that Carl Damiani has been
        appointed to the role of Chief Operating Officer of Transition.

Financial Liquidity

At September 30, 2014, the Company's cash and short term investments were $45,855,591.

The Company's current cash projection indicates that the current cash resources should enable the Company to execute its core business plan and meet its projected cash requirements beyond the next 12 months.

Financial Review

During the three month period ended September 30, 2014, the Company recorded a net loss of $15,695,324 ($0.45 loss per common share) compared to a net loss of $2,331,186 ($0.08 loss per common share) for the three month period ended September 30, 2013.

Research and development expenses increased to $16,034,891 for the three month period ended September 30, 2014 from $1,007,846 for the three month period ended September 30, 2013. The increase in research and development expenses is primarily due to an increase in clinical development costs related to the re-acquired rights to the drug candidate ELND005. The increase is also attributed to an increase in development costs associated with diabetes drug candidate TT401 as the Company paid Lilly US$6 million upon the achievement of the first milestone when 20% patient enrollment was achieved.

General and administrative expenses increased to $1,305,832 for the three month period ended September 30, 2014 from $947,360 for the three month period ended September 30, 2013. The increase in general and administrative expenses is primarily due to increases in professional fees and compensation costs.

About Transition

Transition is a biopharmaceutical development company, advancing novel therapeutics for CNS and metabolic disease indications. The Company's wholly-owned subsidiary, Transition Therapeutics Ireland Limited is developing CNS drug candidate ELND005 for the treatment of Alzheimer's disease and Down syndrome. Transition's lead metabolic drug candidate is TT401 for the treatment of type 2 diabetes and accompanying obesity. The Company's shares are listed on the NASDAQ under the symbol "TTHI" and the Toronto Stock Exchange under the symbol "TTH". For additional information about the Company, please visit www.transitiontherapeutics.com.

Extracts of the Financial Statements to Follow:




    CONSOLIDATED BALANCE SHEETS

    (Unaudited)


    In Canadian Dollars               As at                       As at

                                September 30, 2014           June 30, 2014
    ---                         ------------------           -------------


    Assets

    Current assets

    Cash                                          42,782,040                57,212,004

    Short term investments                         3,073,551                 3,059,562

    Other receivables                                204,208                   220,514

    Investment tax credits
     receivable                                      254,886                   212,393

    Prepaid expenses and
     deposits                                        326,084                    36,656
    --------------------                             -------                    ------

                                                  46,640,769                60,741,129


    Non-current assets

    Property and equipment                           183,222                   158,926

    Intangible assets                              7,855,897                 8,007,181

    Total assets                                  54,679,888                68,907,236
    ============                                  ==========                ==========


    Liabilities

    Current liabilities

    Trade and other payables                       6,150,089                 5,963,258

                                                   6,150,089                 5,963,258


    Non-current liabilities

    Contingent consideration
     payable                                       4,207,774                 3,838,286

    Leasehold inducement                               8,574                    11,432
    --------------------                               -----                    ------

    Total liabilities                             10,366,617                 9,812,976
    -----------------                             ----------                 ---------


    Equity attributable to
     owners of the Company

    Share capital                                207,383,967               207,374,493

    Warrants                                       5,176,397                 5,176,397

    Contributed surplus                           14,768,221                14,768,221

    Share-based payment
     reserve                                       3,753,910                 2,866,292

    Accumulated other
     comprehensive income                             41,451                    24,028

    Deficit                                    (186,810,495)            (171,115,171)
    -------                                     ------------              ------------

    Total equity                                  44,313,451                59,094,260
    ------------                                  ----------                ----------


    Total liabilities and
     equity                                       54,679,888                68,907,236
    =====================                         ==========                ==========




    CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS

    For the three months ended September 30, 2014 and 2013

    (Unaudited)


    In Canadian Dollars, except per share
     data                                                  September 30,             September 30,
                                                                                2014                    2013
    ---                                                                         ----                    ----


    Expenses

    Research and development                                              16,034,891               1,007,846

    Selling, general and administrative
     expenses                                                              1,305,832                 947,360


    Operating Loss                                                      (17,340,723)            (1,955,206)

    Change in fair value of contingent
     consideration payable                                                 (225,301)                      -

    Interest income                                                           65,693                  46,137

    Foreign exchange gain (loss)                                           1,805,007               (422,117)
    ---------------------------                                            ---------                --------

    Net loss for the period                                             (15,695,324)            (2,331,186)


    Other comprehensive loss for the
     period


    Items that may be subsequently
     reclassified to net income:

    Cumulative translation adjustment                                         17,423                       -
    ---------------------------------                                         ------                     ---

    Comprehensive loss for the period                                   (15,677,901)            (2,331,186)
    =================================                                    ===========              ==========

    Basic and diluted net loss per common
     share                                                                    (0.45)                 (0.08)
    =====================================                                      =====                   =====

Notice to Readers: Information contained in our press releases should be considered accurate only as of the date of the release and may be superseded by more recent information we have disclosed in later press releases, filings with the OSC, SEC or otherwise. Except for historical information, this press release may contain forward-looking statements, relating to expectations, plans or prospects for Transition, including conducting clinical trials. These statements are based upon the current expectations and beliefs of Transition's management and are subject to certain risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties include factors beyond Transition's control and the risk factors and other cautionary statements discussed in Transition's quarterly and annual filings with the Canadian commissions.

SOURCE Transition Therapeutics Inc.