(Durham, N.C.) Inspire Pharmaceuticals, Inc. (NASDAQ: ISPH) announced today financial results for the fourth quarter and year ended December 31, 2009, reporting a net loss of $2.6 million or ($0.03) per share for the fourth quarter and a net loss of $40.0 million or ($0.60) per share for the full year.

Total revenue for the fourth quarter of 2009 was $29.6 million, as compared to $18.9 million for the fourth quarter of 2008, reflecting an increase of 57%. Revenue from AZASITE® (azithromycin ophthalmic solution) 1% totaled $12.1 million in the fourth quarter of 2009, an increase of 67% compared to $7.3 million recognized in the fourth quarter of 2008. Inspire estimates that approximately $2.0-$2.5 million of fourth quarter 2009 AZASITE revenue was associated with hospital usage of AZASITE as a substitute therapy during a supply shortage of erythromycin ophthalmic ointment (0.5%).

Total product co-promotion and royalty revenue, comprised of royalty revenue from net sales of RESTASIS® (cyclosporine ophthalmic emulsion) 0.05% and co-promotion revenue from net sales of ELESTAT® (epinastine HCl ophthalmic solution) 0.05%, was $17.5 million for the fourth quarter of 2009, compared to $11.6 million in the fourth quarter of 2008, reflecting an increase of 51%. Royalty revenue for the fourth quarter of 2009 from RESTASIS was $12.0 million and co-promotion revenue from ELESTAT was $5.5 million, as compared to $8.6 million and $3.0 million in the fourth quarter of 2008, respectively.

Total revenue for the year ended December 31, 2009 was $92.2 million, an increase of 31% compared to the $70.5 million recognized in 2008. AZASITE revenue was $35.0 million in 2009, as compared to $18.3 million recognized in 2008. Co-promotion and royalty revenues were $57.2 million in 2009, an increase of approximately $6.3 million, or 12%, compared to $50.9 million in 2008.

Operating expenses for the fourth quarter of 2009 totaled $31.8 million, as compared to $27.8 million for the same period in 2008. The increase in fourth quarter 2009 operating expenses was primarily due to increased cost of sales as a result of increased AZASITE sales volume, as well as an increase in sales and marketing expense.

Operating expenses for the year ended December 31, 2009 were $129.8 million as compared to $120.2 million in 2008. The increase in 2009 operating expenses was primarily due to an increase in research and development expenses associated with ongoing programs, an increase in cost of sales due to increased AZASITE sales volume, and a restructuring charge associated with the elimination of preclinical and drug discovery activities, all of which were partially offset by a decrease in sales and marketing expense.

For the quarter ended December 31, 2009, the Company reported a net loss of $2.6 million, or ($0.03) per common share, reflecting a 74% decrease as compared to a net loss of $9.7 million, or ($0.17) per common share, for the same period in 2008. Net loss for the year ended December 31, 2009 decreased by 23% to $40.0 million, or ($0.60) per common share, as compared to a net loss of $51.6 million, or ($0.91) per common share, for the same period in 2008.

Cash, cash equivalents and investments totaled $129.1 million at December 31, 2009, reflecting an $11.2 million utilization of cash and investments in the fourth quarter and a $56.1 million increase in cash and investments from December 31, 2008 as a result of the Company’s public offering in August 2009. Excluding the net proceeds from the public offering, the Company utilized $52.9 million of cash in the twelve months ended December 31, 2009, down from $66.7 million utilized in 2008.

“I am excited to join Inspire at such a pivotal stage of its corporate development. Inspire is uniquely positioned with a focus on the ophthalmic and pulmonary specialty markets,” Adrian Adams, President and CEO of Inspire, stated. “We have an excellent platform to move the Company forward to profitability, including double-digit revenue growth, a strong financial position and a promising portfolio of late-stage compounds. We look forward to a productive 2010 as we continue to drive our current product portfolio and focus our R&D resources on advancing our novel clinical programs.”