Exhibit 99.1
[GRAPHIC OMITTED]
FOR IMMEDIATE RELEASE
CONTACT:
George J. Longo Carl Hymans
Vice President, CFO G.S. Schwartz & Co.
(215) 345-0919 (212) 725-4500
carlh@schwartz.com
THE QUIGLEY CORPORATION REPORTS FIRST QUARTER RESULTS
- CONTINUES ITS INVESTING FOR THE FUTURE IN PHARMACEUTICAL R&D -
DOYLESTOWN, PA. - APRIL 27, 2006 - THE QUIGLEY CORPORATION (NASDAQ: QGLY) today
reported net sales of $10.3 million, for the first quarter ended March 31, 2006,
compared to $11.8 million reported for the same period in 2005.
Net sales of the Company's Cold Remedy, Health and Wellness and Contract
Manufacturing segments recorded declines in this first quarter of 2006 as
compared to 2005 that averaged approximately $500,000 for each segment.
During 2005, the Company's Cold Remedy net sales outpaced its category as the
further expansion of the Cold Remedy segment reflected the success of strategic
marketing initiatives and advertising with a notable increase in consumer
acceptance and expanded household penetration. Sales declines in the first
quarter of 2006 may be attributable to a widely disseminated controversial
report published in the January 2006 issue of the "Chest," the peer reviewed
journal of the American College of Chest Physicians (ACCP), that implied that
cough products had limited effectiveness while antihistamines were more
effective in reducing coughs. This report had an impact of increasing allergy
product sales and depressing cough cold category sales during the traditional
peak of the common cold season. Additionally, the brand and category as a whole
has faced increased competition from certain vitamin based products that have
launched successful public relations campaigns despite the fact that they lack
both safety and clinical efficacy data. Ongoing marketing will feature
COLD-EEZE(R) clinical effectiveness in two double-blind placebo controlled
studies as well as its efficacy studies in adolescents and safety studies with
Geriatric patients.
Guy J. Quigley, Chairman, President and Chief Executive Officer stated, "We
continue to remain confident in the COLD-EEZE brand and its appeal to a broad
range of consumers with a growing interest in Natural Common Cold remedies that
demonstrate proven clinical efficacy and safety unlike other natural remedies.
We are well positioned to capture market share, enhance our household
penetration to be able to increase sales of our COLD-EEZE Cold Remedy products."
The Health and Wellness segment continues to be affected by the shift from the
number of active domestic independent distributor representatives, which has
outpaced the growth of active international independent distributor
representatives or an increase of 30.0% for this segment's international sales
as compared to 2005. Corrective actions concerning the shifting in active
independent distributor representatives continue to be the focus for this
segment.
The Contract Manufacturing segment's prime purpose is for the manufacture of
COLD-EEZE, however, other contract manufacturing is performed for third party
entities. In comparing 2006 with 2005, an OTC company that utilized
manufacturing capabilities of this segment discontinued their product in the
marketplace, thereby resulting in the reduced sales for the Contract
Manufacturing segment of the Company. Management is reviewing opportunities to
replace this lost business with other third party manufacturing contracts.
Net loss for the quarter ended March 31, 2006 was $1.5 million, or ($0.12) per
share, compared to net loss of $155,000 or ($0.01) per share, for the same
period last year.
The increase in net loss is principally attributed to the decrease in all of the
Company's segment sales, especially the Cold Remedy segment, which has a greater
gross profit percentage and dollar margin and fewer fixed and directly variable
costs than the other operating segments. Additionally, operating expenses
increased for advertising, promotions, insurance and legal costs relative to the
lawsuits for the Company's discontinued nasal spray product.
Gross profit percentages for the Cold Remedy segment for 2006 increased due to
the expiration in May 2005 of the founder's commission with the Health Wellness
segment remaining relatively unchanged. Also, due to the lost revenues from a
major OTC company that utilized the manufacturing abilities of the Contract
Manufacturing segment, its gross profit percentage declined, which already has a
substantially lower gross profit margin then the other operating segments.
No tax or tax benefits to reduce income or losses are provided for the quarters
ended March 31, 2006 and 2005, except for any limitations imposed by the
alternative minimum, since the Company is in a net operating loss carry-forward
position.
"Quigley Pharma, our wholly-owned Ethical Pharmaceuticals subsidiary, represents
a significant potential source of growth for the Company. For example, QR-333,
our topical compound for the treatment of Diabetic Peripheral Neuropathy,
recently filed an IND and commenced plans to begin a Phase II B study to develop
the most efficacious dose range of this topical compound on human patients.
According to the American Diabetic Association, there are over twenty million
people in the United States who have diabetes. They represent a huge market for
the product we are developing," continued Mr. Quigley.
"We are striving to capitalize on the growth potential of Quigley Pharma by
continuing to develop natural-source potential prescription products for
Diabetic Neuropathy, Systemic Radiation, Rheumatoid Arthritis, Avian Flu in
animals, and Ocular and Genital Herpes. We will continue to develop and test
ethical pharmaceutical drugs as part of our ongoing efforts to generate future
growth," concluded Mr. Quigley.
The following is a summary of major ethical pharmaceutical events that occurred
during the first quarter of 2006:
At the annual meeting of Quigley's Scientific Advisory Board, composed of 12
highly regarded medical professionals and three additional guest attendees, 2005
research and development results were reviewed. The Board was extremely
encouraged by the findings and strongly support Quigley Pharma's research and
development efforts and advocates their next stage of development.
DIABETIC NEUROPATHY - QR-333: Quigley Pharma filed an IND (Investigational New
Drug) application with the FDA for QR-333, a topical compound for the treatment
of Diabetic Peripheral Neuropathy and commenced its plans to begin a Phase II B
study to develop the most efficacious dose range of this topical compound on
human patients. QR-333 had been evaluated in animal model toxicity experiments
previous to the IND filing. QR-333 is designed and formulated to decrease
oxidative stress that contributes to peripheral diabetic neuropathy and thus
alleviate its symptoms. The original proof of concept study completed in France,
showed that the topical compound improved the quality of life as well as
improved key symptoms associated with this complication of diabetes. The
subjects using the compound had 67% of their symptoms improve, suggesting
efficacy. According to estimates from the American Diabetes Association, 7.0
percent of US adults or 20.8 million people have diabetes.
SYSTEMIC RADIATION - QR-336: This naturally derived radio protective compound
against ionizing radiation initially received encouraging results in a
preliminary non-GLP animal study. A pre-IND meeting was held at the FDA in
October of 2004 with the Division of Medical Imaging and Radiopharmaceutical
Drug Products. The aforementioned Scientific Advisory Board noted that
preliminary evidence demonstrates QR336's potential as a systemic radio
protective agent and recommended further studies. Plans are underway to advance
an animal model development plan that will comply with New Food and Drug
Administration animal efficacy rules for radio-protective pharmacological
compounds.
RHEUMATOID ARTHRITIS - QR-440: Quigley Pharma received an additional
Investigational New Animal Drug (INAD) number from the Center for Veterinary
Medicine of the Food and Drug Administration to study its naturally-derived,
broad-spectrum anti-inflammatory compound QR-440 on dogs. In previous studies,
QR-440 has been shown to reduce inflammation and also suggests possible
disease-modifying potential. Canine arthritis afflicts an estimated 70 to 80
percent of dogs in certain breeds, particularly larger breeds.
AVIAN FLU COMPOUND - QR-441(A): Quigley Pharma initiated plans to test its all
natural broad spectrum antiviral compound against Avian Flu in poultry stocks.
The company has enlisted noted experts, Dr. Timothy S. Cummings, Clinical
Poultry Professor at the College of veterinary medicine at Mississippi State
University and Thomas G. Voss, Ph.D. Assistant Professor Tulane University
School of Medicine to assist Quigley Pharma in the development of the
Investigational New Animal Drug (INAD) bird challenge studies. According to
previously announced in vitro testing, QR-441A appears to have the potential to
inhibit infectivity of the avian H5N1 virus in poultry populations.
OCULAR AND GENITAL HERPES - QR-435: In pre-clinical studies, the antiviral
formulation demonstrates potent antiviral activity against Ocular and Genital
Herpes, indicating a new research and development path for the versatile
compound. The studies were designed to determine the in vitro inhibitory
activity of QR-435 vs. two ocular isolates of Herpes Simplex Virus - 1 (HSV-1)
and 2 non-ocular isolates of Herpes Simplex Virus -2 (HSV-2). The pre-clinical
studies of QR-435 demonstrated reproducible potent direct antiviral activity
against an ocular isolate of HSV-1. It also demonstrated similar potent direct
antiviral activity against a second similar ocular isolate of HSV-1 and multiple
clinical genital isolates of HSV-2.
The Quigley Corporation makes no representation that the US Food and Drug
Administration or any other regulatory agency will grant an Investigational New
Drug ("IND") or take any other action to allow its formulations to be studied
or/and for any Investigational New Drug to be marketed. Furthermore, no claim is
made that potential medicine discussed herein is safe, effective, or approved by
the Food and Drug Administration. Additionally, data that demonstrates activity
or effectiveness in animals or in vitro tests do not necessarily mean the
formula test compound, referenced herein will be effective in humans. Safety and
effectiveness in humans will have to be demonstrated by means of adequate and
well controlled clinical studies before the clinical significance of the formula
test compound is known. Readers should carefully review the risk factors
described in filings the Company files from time to time with the Securities and
Exchange Commission.
ABOUT THE QUIGLEY CORPORATION
The Quigley Corporation (Nasdaq: QGLY, http://www.Quigleyco.com) is a
diversified natural health medical science company. Its Cold Remedy segment is a
leading marketer and manufacturer of the COLD-EEZE(R) family of lozenges, gums
and sugar free tablets clinically proven to cut the common cold nearly in half.
COLD-EEZE customers include leading national wholesalers and distributors, as
well as independent and chain food, drug and mass merchandise stores and
pharmacies. The Quigley Corporation has several wholly owned subsidiaries.
Darius International markets health and wellness products through its wholly
owned subsidiary, InnerLight Inc. Quigley Manufacturing Inc. consists of two FDA
approved facilities to manufacture COLD- EEZE(R) lozenges as well as fulfill
other contract manufacturing opportunities. Quigley Pharma Inc.
(http://www.QuigleyPharma.com) conducts research in order to develop and
commercialize a pipeline of patented botanical and naturally derived
prescription drugs.
FORWARD-LOOKING STATEMENTS
Certain statements in this press release are "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995 and involve
known and unknown risk, uncertainties and other factors that may cause the
Company's actual performance or achievements to be materially different from the
results, performance or achievements expressed or implied by the forward-looking
statement. Factors that impact such forward-looking statements include, among
others, changes in worldwide general economic conditions, changes in interest
rates, government regulations, and worldwide competition.
(Tables Follow)
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
The following represents condensed financial data (in thousands) except per
share data:
Three-Months Three-Months
Ended Ended
March 31, 2006 March 31, 2005
($) ($)
---------------------------------------
Net Sales 10,266 11,753
Gross profit 5,313 5,703
Sales & marketing expenses 2,435 1,835
Administrative expenses 3,706 2,995
Research & development 784 1,068
Income taxes - -
Net loss (1,454) (155)
Diluted loss per share:
Net loss ($0.12) ( $0.01)
Diluted weighted average common shares outstanding: 11,714,140 11,654,796
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
The following represents condensed financial data (in thousands) at March 31, 2006 and December 31, 2005:
2006 2005
($) ($)
------------ ---------
Cash & cash equivalents 18,190 16,885
Accounts receivable, net 2,686 7,880
Inventory 4,228 3,900
Total current assets 26,337 30,248
Total assets 31,911 35,976
Total current liabilities 7,903 9,566
Long-term debt - 1,036
Total stockholders' equity 23,951 25,320