An increase in research and development and other expenses caused Senomyx's revenue to slip 23 percent in Q4, according to the results published by the company last week.
The food technology company reported revenues for the fourth quarter as $2.1 million, compared to $2.8 million for the same period in 2003. In parallel with this decrease, Senomyx highlighted increases in R&D expenses - up to $4.8 million, compared to $4.5 million for the same period in 2003.
This eight percent increase was mainly due, said the company, to costs associated with regulatory filings for two of its company's savory enhancer products.
Senomyx added that general and administrative expenses also rose significantly due to it becoming a public company to $2.1 million in the fourth quarter of 2004, from $1.1 million for the same period in 2003.
"Senomyx made significant progress across a number of critical fronts during 2004, including addressing our financing needs with an IPO in June, advancing our first product candidates into the regulatory review process and establishing a new collaborative agreement [with Nestle]," said Kent Snyder, CEO of Senomyx.
He said that the company's submittal to the Flavor and Extract Manufacturers Association (FEMA) during the fourth quarter for the review of two savory enhancer products was a significant milestone for Senomyx, bringing the commercialization of the product a step closer.
The company will continue to closely manage its cash usage as it moves towards commercialization, according to John Poyhonen, the chief financial and business officer.
Senomyx submitted its enhancers S336 and S807 to FEMA to be registered as GRAS at the end of December 2004. These are savory enhancers that the company claims function as a savory flavor and an enhancer of savory taste and may therefore eliminate the need for added monosodium glutamate (MSG) in packaged foods and beverages.
Results from FEMA are expected during the first half of this year, which could mean that the ingredient could be found in packaged foods and drinks by the first half of 2006, said Poyhonen.
He told FoodNavigatorUSA.com recently that the savory enhancement project is one of four research projects that the company currently has in place.
The second project is looking at sweet enhancers that unlike artificial sweeteners are made from natural ingredients.
Salt enhancers designed to reduce the sodium content is the company's third project underway at present, which are presently being screened using human taste receptors.
Poyhonen noted that during the third quarter of 2003, the company started looking at a bitter blocking program aimed at reducing the bitter taste of foods such as soy products.
He said that nutritious foods often taste more bitter than sweet or sugary snacks and with the growing emphasis on healthy eating there is more demand from manufacturers for bitter foods to taste better.
Back in October Senomyx announced a second collaboration with the Swiss food giant Nestlé. This was a five-year agreement for the discovery and commercialization of novel flavor ingredients in the coffee and coffee whitener fields. The first collaboration - entered into in 2002 - focused on the discovery of novel flavors and flavor enhancers for dehydrated and culinary foods, frozen foods and wet soups.