“While the economic and capital markets outlook for 2009 remains uncertain, the regenerative medicine and stem cell sectors have gained significant momentum and exposure since the beginning of the year,” said George Dunbar, President and Chief Executive Officer of Aastrom. “With the progress we have made to date in our U.S. cardiac and vascular regeneration clinical trials, we have laid the foundation for building shareholder value, and we look forward to reporting developments from our clinical programs as they occur.”
Second fiscal quarter ended December 31, 2008 results
Total costs and expenses for the quarter and six months ended December 31, 2008 decreased to $4,180,000 and $8,226,000, respectively, from $5,621,000 and $11,108,000 for the same periods in fiscal year 2008.
Research and development expenses decreased to $2,829,000 and $5,555,000, respectively, for the quarter and six months ended December 31, 2008 against $3,895,000 and $7,768,000 for the same periods in fiscal year 2008. These decreases reflect the changes we implemented in May 2008, when we reprioritized our clinical development programs to focus primarily on cardiovascular applications. The reprioritization reduced our overall research and development expenses, including salaries and benefits and other purchased services. Research and development expenses for the quarter and six months ended December 31, 2008, included a non-cash charge of $174,000 and $335,000, respectively, against $214,000 and $437,000 for the same periods in fiscal year 2008, relating to share-based compensation expense.
Selling, general and administrative expenses decreased to $1,333,000 and $2,649,000, respectively, for the quarter and six months ended December 31, 2008 from $1,725,000 and $3,339,000 for the same periods in fiscal year 2008. These decreases are primarily due to lower salaries and benefits and other purchased services that are the result of the reduction in force that was part of our reprioritization of our clinical programs. For the quarter and six months ended December 31, 2008, selling, general and administrative expenses included a non-cash charge of $219,000 and $421,000, respectively, against $344,000 and $670,000 for the same periods in fiscal year 2008, relating to share-based compensation expense.
Interest income for the quarter and six months ended December 31, 2008 decreased to $69,000 and $196,000, respectively, from $386,000 and $751,000 for the same periods in fiscal year 2008. The fluctuations in interest income are due primarily to corresponding changes in the level of cash, cash equivalents and short-term investments during the periods, and varying yields from our investments.
Interest expense was $20,000 and $41,000, respectively, for the quarter and six months ended December 31, 2008 against $21,000 and $36,000, respectively, for the same periods in fiscal year 2008. Interest expense is related to long-term debt for equipment acquired during the fiscal year ended June 30, 2008.
Net loss for the quarter ended December 31, 2008 was $4,103,000, or $.03 per share, against a net loss of $5,172,000, or $.04 per share for the same period in fiscal year 2008. Net loss for the six months ended December 31, 2008, was $8,016,000, or $.06 per share, against $10,222,000, or $.08 per share for the same period in fiscal year 2008. The decreases in net loss are primarily the result of decreased costs and expenses offset in part on a per share basis by an increase in the weighted average number of common shares outstanding.
At December 31, 2008, we had $16.3 million in cash, cash equivalents and short-term investments as against $22.5 million at June 30, 2008. We have reduced operating expenses by a combination of clinical program reprioritizations and fiscal discipline to achieve an average cash utilization of about $1.2 million per month for the first six months of the fiscal year ending June 30, 2009. It is anticipated that the average cash utilization will be $1.5 million per month for the second six months of the fiscal year ending June 30, 2009. At January 31, 2009, we had $17.5 million in cash and cash equivalents.