Global Pharma Management

Net revenue from unconsolidated joint operating activities was $0.4 million and $24.8 million for the fourth quarter and year ended December 31, 2009 compared to $4.2 million and $29.0 million for the same periods in 2008. The decrease in net revenue from unconsolidated joint operating activities for the fourth quarter of 2009 compared to the same quarter in the prior year was the result of a decrease in revenues recognized from up-front license and milestone payments under the GSK agreement and the recognition of XenoPort's share of pre-launch operating losses of Horizant. The decrease in net revenue from unconsolidated joint operating activities for 2009 compared to 2008 was the result of a decrease in revenues recognized from up-front license and milestone payments under our GSK agreement and the recognition of our share of pre-launch operating losses of Horizant.

Collaboration revenues were $5.4 million and $9.5 million for the three months and 12 months ended December 31, 2009, compared to $6.4 million and $13.0 million for the same periods in 2008. The decrease in collaboration revenues for the three months and 12 months ended December 31, 2009 compared to the same periods in 2008 was the result of a decrease in revenues recognized under our agreement with Xanodyne Pharmaceuticals, Inc., which terminated in July 2009, partially offset by an increase in revenues recognized from milestone payments under our Astellas agreement.

Research and development expenses for the fourth quarter of 2009 were $16.7 million, compared to $22.3 million for the same period in 2008. The decrease in expenses for the quarter was primarily due to decreased development activities for AP, XP21279 and preclinical programs. Research and development expenses for 2009 were $70.7 million, compared to $83.2 million for the same period in 2008. The decrease in research and development expenses for 2009 was primarily due to decreased development activities for Horizant, AP and other development programs, partially offset by increased development costs for XP21279, as well as increased personnel costs resulting from increased headcount, including increased non-cash stock-based compensation.

Selling, general and administrative expenses were $8.1 million for the fourth quarter of 2009, compared to $7.8 million for the same period in 2008. Selling, general and administrative expenses were $31.8 million for 2009, compared to $26.4 million for 2008. The increase for both periods was primarily due to increased personnel and related costs resulting from increased headcount, including non-cash stock-based compensation.

Net loss for the fourth quarter of 2009 was $18.3 million, compared to net loss of $18.7 million for the same period in 2008. Net loss per basic and diluted share was $0.60 for the fourth quarter of 2009, compared to a net loss per basic and diluted share of $0.74 for the same period in 2008. Net loss for 2009 was $66.3 million, compared to a net loss of $62.5 million 2008. Net loss per basic and diluted share was $2.31 for 2009, compared to a net loss per basic and diluted share of $2.48 for 2008.

About XenoPort

XenoPort, Inc. is a biopharmaceutical company focused on developing a portfolio of internally discovered product candidates that utilize the body's natural nutrient transport mechanisms to improve the therapeutic benefits of existing drugs. XenoPort is collaborating with Astellas Pharma Inc. and GSK to develop and commercialize XP13512 (known as Horizant in the United States). XenoPort's product candidates are being studied for the potential treatment of restless legs syndrome, GERD, migraine headaches, neuropathic pain, spasticity and Parkinson's disease.