8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

May 4, 2006

Date of Report (Date of earliest event reported)

NEUROGEN CORPORATION

(Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation)     0-18311 (Commission File Number)     22-2845714 (I.R.S. Employer Identification No.)  

35 Northeast Industrial Road

Branford, Connecticut   06405

(Address of principal executive offices) (Zip Code)

(203) 488-8201

(Registrant's telephone number, including area code)

None

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:  

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))  

Item 2.02 Results of Operations and Financial Condition

On May 4, 2006, Neurogen Corporation issued a press release announcing its results of operations for the first quarter ended March 31, 2006. The information contained in Exhibit 99.1 is incorporated herein by reference.

The information in this Current Report (including Exhibit 99.1) is being furnished and shall not be deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing to this Item 2.02.

Item 9.01 Financial Statements and Exhibits

(c) Exhibits

99.1 Press release dated May 4, 2006.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	NEUROGEN CORPORATION
	(Registrant)
	By: /s/ STEPHEN R. DAVIS
Date: May 4, 2006	Name: Stephen R. Davis Title: Executive Vice President and Chief Operating Officer

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press release dated May 4, 2006.

EX-99.1

Exhibit 99.1

	Neurogen Corporation

For Immediate Release Contact: Elaine Grimsell Dodge Neurogen Corp. 203-315-4615 edodge@nrgn.com

NEUROGEN CORPORATION ANNOUNCES

FIRST QUARTER 2006 FINANCIAL RESULTS

Branford, CT, May 4, 2006 — Neurogen Corporation (Nasdaq: NRGN), a drug discovery and development company, today announced financial results for the first quarter of 2006. For the three months ended March 31, 2006, Neurogen recognized a net loss of $14.3 million, or $0.42 per share. This compares to a net loss of $8.1 million, or $0.24 per share, during the comparable three month period of 2005.

The increase in net loss reflects the impact of continued progress in Neurogen’s clinical and preclinical drug development programs. Also impacting results for the current quarter was the adoption on January 1, 2006 of Statement of Financial Accounting Standards 123R, “Share-based Payment” (SFAS 123R), which resulted in non-cash operating expenses of approximately $1.3 million for the first quarter of 2006, or an effect of approximately $0.04 per share.

Neurogen’s cash and marketable securities as of March 31, 2006 totaled $102.2 million as compared to $115.4 million as of December 31, 2005.

William H. Koster, Ph.D., President and CEO said, “We are moving ahead in our four major programs and looking forward to significant milestones during the rest of the year. We began Phase II trials with our proprietary lead insomnia compound, NG2-73, in December 2005 and that trial in transient insomnia is continuing to progress. We are on plan to report preliminary results by mid-year.

“Our VR1 antagonist program for pain and other indications, partnered with Merck, continues in Phase I clinical testing, which began during the quarter. Compounds from our programs with CRF1 antagonists for stress-related disorders and MCH1 antagonists for obesity are undergoing preclinical testing. If they pass all criteria, these compounds hold the promise of further expanding our clinical pipeline. Both programs are wholly-owned by Neurogen. The portfolio will also continue to be bolstered by our drug discovery platform, as we evaluate several other emerging programs in indications with unmet medical need.”

Operating revenue for the first quarter of 2006 increased 95% to $3.8 million from $2.0 million for the first quarter of 2005. The increase for the current quarter is due primarily to a $2 million clinical milestone received from Merck upon the initiation of Phase I clinical trials in Neurogen’s and Merck’s VR1 program collaboration.

Research and development expenses for the first quarter of 2006 increased 92% to $15.8 million from $8.3 million in the first quarter of 2005. The increase for the quarter was due primarily to increased expenditures for clinical and preclinical testing for the Company’s drug development initiatives, as compared to the first quarter of 2005. Also impacting the current quarter was a $1.0 million non-cash operating expense due to the adoption of SFAS 123R.

General and administrative expenses for the first quarter of 2006 increased 18% to $3.0 million, compared to $2.6 million for the same period in 2005. The increase for the current quarter was due primarily to a $0.3 million non-cash operating expense due to the adoption of SFAS 123R.

Webcast

Dr. Koster and Stephen Davis, Executive Vice President and Chief Operating Officer, will host a conference call and webcast to discuss today’s announcements at 10:00 a.m. EDT on May 4, 2006. The webcast will be available in the Investor Relations section of www.neurogen.com and will be archived on the website until December 31, 2006. A replay of the call will be available after 1:00 pm EDT on May 4, 2006 and accessible through the close of business, May 28, 2006. To replay the conference call, dial 888-286-8010, or for international callers, 617-801-6888, and use the pass code: 45685493.

About Neurogen

Neurogen Corporation is a drug discovery and development company focusing on small molecule drugs to improve the lives of patients suffering from disorders with significant unmet medical need, including insomnia, pain, depression, obesity, and inflammation. Neurogen has generated a portfolio of compelling new drug candidates through its Accelerated Intelligent Drug Discovery (AIDD™) system, its expertise in cellular functional assays, and its depth in medicinal chemistry. Neurogen conducts its research and development independently and, when advantageous, collaborates with world-class pharmaceutical companies.

Safe Harbor Statement

The information in this press release contains certain forward-looking statements that involve risks and uncertainties as detailed from time to time in Neurogen's SEC filings, including its most recent Form 10-K. Actual results may differ materially from the statements made as a result of various factors, including, but not limited to, risks associated with the inherent uncertainty of drug research and development, difficulties or delays in development, testing, regulatory approval, production and marketing of any of the Company's drug candidates, adverse side effects or inadequate therapeutic efficacy or pharmacokinetic properties of the Company's drug candidates or other properties of drug candidates which could make them unattractive for commercialization, advancement of competitive products, dependence on corporate partners, sufficiency of cash to fund the Company's planned operations and patent, product liability and third party reimbursement risks associated with the pharmaceutical industry. Future results may also differ from previously reported results. For example, positive results or safety and tolerability in one clinical study provides no assurance that this will be true in future studies.

(Financial Tables to Follow)

Page 3 of 4: Neurogen Announces First Quarter 2006 Financial Results, 5-4-06

NEUROGEN CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(unaudited)

	Three Months Ended March 31, 2006			Three Months Ended March 31, 2005*
Operating revenues:
License fees	$	1,115		$	906
Research revenues		2,700			1,050
Total operating revenues		3,815			1,956
Operating expenses:
Research and development		15,829			8,256
General and administrative		3,018			2,560
Total operating expenses		18,847			10,816
Operating loss		(15,032	)		(8,860	)
Other income, net		689			794
Net loss	$	(14,343	)	$	(8,066	)
Loss per share:
Basic and diluted	$	(0.42	)	$	(0.24	)
Shares used in calculation of loss per share:
Basic and diluted		34,449			34,243

* Certain reclassifications have been made to the three month period ended March 31, 2005 to conform to the 2006 presentation.

--more--

Page 4 of 4: Neurogen Announces First Quarter 2006 Financial Results, 5-4-06

NEUROGEN CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)

(unaudited)

	March 31, 2006		December 31, 2005
Assets
Cash and cash equivalents	$	17,489	$	11,241
Marketable securities		84,665		104,119
Total cash and marketable securities		102,154		115,360
Receivables from corporate partners		184		157
Other current assets, net		2,369		2,892
Total current assets		104,707		118,409
Net property, plant & equipment		28,045		28,268
Other long-term assets		78		87
Total assets		132,830	$	146,764
Liabilities and Stockholders' Equity
Total current liabilities	$	13,237	$	12,946
Total long term liabilities		17,834		19,310
Total liabilities		31,071		32,256
Total stockholders' equity		101,759		114,508
Total liabilities and stockholders’ equity	$	132,830	$	146,764

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