Samaritan battles woes but keeps upbeat outlook

Samaritan Pharmaceuticals of Las Vegas is following a plot similar to one in the movie classic "It's a Wonderful Life," which starred Jimmy Stewart.

Stewart plays depressed businessman George Bailey whose Bailey Building and Loan has hit hard times. An angel reminds Bailey how lucky he is, and disaster is averted. Bailey doesn't jump off the bridge. Stewart's character becomes upbeat again and returns home where family and friends greet him warmly.

Samaritan executives demonstrate that same kind of optimism, but comments from CEO Janet Greeson don't mention any problems at the company this year.

"We have made significant advancements this year in our ongoing clinical development programs and the successful launch of our new international distribution business," Greeson said in a statement.

The statement dated Dec. 27 says the company "management has proven their ability to continue on a successful path to commercial breakthrough drugs and Samaritan's 2008 prognosis looks good."

It's hard to imagine a more devastating year for Samaritan than 2007. Losses continued. A multimillion dollar check from another business bounced. The share price fell.

But Chief Financial Officer Eugene Boyleon Monday predicted that Samaritan would become profitable next year.

His prediction follows a loss of $16,000 in the nine months ending Sept. 30, compared to a loss of $24,000 a year ago. The development stage company has run up $41 million in losses since 1994.

Revenues soared to $3.9 million from $32,000 during the first nine months of 2007.

The company started sales toward the end of the second quarter with three drugs in Eastern Europe and Greece, Boyle said. More drugs will come out soon, creating profits by no later than the third or fourth quarter, he said.

The company files quarterly financial reports only with the Securities and Exchange Commission, as required, but it has not released news releases about its financial results, Boyle acknowledged. Samaritan probably will start issuing financial statements this year, he said.

Samaritan did a reverse split in an effort to boost its share price in 2007. It swapped one share of stock for each six outstanding shares in July -- but the share price continued to fall. The American Stock Exchange delisted the company in December because the company didn't have $6 million in shareholder equity.

Boyle explained that many of Samaritan's assets are drug patents that must be reported on its books at values below their potential value. He hopes the company will be able to regain its Amex listing.

Samaritan got a $8.6 million check in October under a commercialization agreement with Pharmaplaz of Ireland. The check bounced. Pharmaplaz made a $750,000 wire transfer. Pharmaplaz has pledged 943,000 of Samaritan stock to back up the amount owed.

Boyle said Michael Macken, the owner of Pharmaplaz, attributed the bounced check to his failure to sell a piece of Irish real estate as planned.

Samaritan continues talks with Pharmaplaz about the overdue payment. If Macken pays the amount owed in full, Boyle said, Samaritan will return a profit for the year.

Shares in Samaritan have plunged to 33 cents on the Over-The-Counter Bulletin Board from $1.31 as recently as July 10, when it traded on Amex. Shares were off 3 cents Monday.

Contact reporter John G. Edwards at jedwards@reviewjournal.com or (702) 383-0420.