With money in the bank and two drugs well along the development route, Medicure Inc. is right on track with the industry rule of thumb that says it takes 10 to 12 years to develop a new drug.

The Winnipeg cardiovascular drug discovery company yesterday released second-quarter results for the period ending Nov. 30 and it has money in the bank, new drugs working their way through clinical trials and regulatory approval and increasing interest from investors.

"I'm very pleased with where we are," Medicure CEO Albert Friesen said yesterday in an interview. "We have a good strong cash position and two Phase II trials with one that will transition to Phase III this year. When we started in 1997 this is where we wanted to be now."

As of the end of the quarter, the company had just more than $10 million in cash or cash equivalents as a result of modest proceeds from the exercise of options and warrants. Subsequent to the end of the second quarter the company received as additional $13 million from the exercise of warrants so Medicure now has about $23 million in the bank.

Research and development expenses for the first six months of the current fiscal year totalled $1,649,000 compared to $1,931,000 for the six-month period ended November 30, 2002. The slightly lower total is due to the timing of the end of one set of clinical trials and the beginning of the next round.

Friesen said that research and development expenses are expected to be higher for the balance of fiscal 2004 compared to last year. The company currently is in the midst of a modest phase II clinical trial for its second drug, MC-4232, a treatment for hypertension that is being tested on diabetes patients. While the trial will involve only about 15 patients, the most significant undertaking will be a 900-patient phase II trial of its main compound, MC-1, in patients undergoing coronary artery bypass graft (CABG) procedures.

Friesen refers to the regulatory approval for that trial as the most significant event in the company's history.

A Phase II trial last year showed the drug was effective in treating and preventing heart tissue damage during and after angioplasty treatments.

"It is true that early data (on MC-1) is quite strong," a biotech analyst from Toronto who is considering formalizing coverage of Medicure said yesterday.

Friesen said recruitment of locations and patients for that large trial are now underway.

Since the company is engaged in a greater volume of business undertakings it is not surprising that its general and administrative costs are also increasing. For the first six months of the year those costs increased by an even 50 per cent to $834,000. Friesen said those expenses are at or below industry averages. Medicure officials anticipate those expenses will continue to go up in support of increasing business activities.

As a result of the additional activity Medicure posted a consolidated net loss from operations of $1,247,000 or $0.03 per share, compared to $1,173,000 or $0.03 per share for the three-month period ended November 30, 2002. The net loss for the six months ended Nov. 30 was $2,346,000 or $0.05 per share compared to a net loss of $2,379,000 or $0.06 per share for the same period a year ago.

Medicure's shares were up three cents to $1.64 yesterday.