Diagnocure announces third quarter 2009 financial results
QUEBEC CITY, Sept. 14 /PRNewswire-FirstCall/ - DiagnoCure Inc. (TSX: CUR), a life sciences company commercializing high-value cancer diagnostic tests and delivering laboratory services, announced revenue of $396,468 and a net loss of $4,034,364 or $0.09 per share for the third quarter ending July 31, 2009. The net loss in this quarter reflects in part activities initiated to promote the Previstage(TM) GCC Colorectal Cancer Staging Test, but also a foreign exchange loss of $479,588 related to conversion in C$ of the short-term investments the Company held in US$ at the end of the quarter, and non-recurrent expenses of $309,184 related to the prospectus filed in June 2009. At the end of the quarter, cash, short-term investments and long-term investments stood at $17,249,422, an increase of $3,165,593 over the second quarter of 2009.
Highlights of the Quarter
The third quarter started with an investment of US$5 million in DiagnoCure by Gen-Probe, the Company's partner for the development and commercialization of the PCA3 test. In return, Gen-Probe received 4.9 million DiagnoCure's convertible preferred shares and, if the shares were converted, would own over 10% of the Company. This investment was part of a new amendment to the companies' six-year old collaboration agreement, which called for new milestones with regard to a regulatory submission of the PCA3 prostate cancer test to the U.S. Food and Drug Administration (FDA).
Pursuing this commitment to advance the commercial development of the PCA3 test, Gen-Probe announced on August 27 that they had begun a U.S. clinical trial of the PROGENSA(R) PCA3 assay with the intent of securing U.S. regulatory approval of the test. Their stated goal is to complete the study in less than one year and thereafter submit a Premarket Approval Application (PMA) to the FDA for the full marketing and commercialization of the PCA3 prostate cancer test in the United States. The study will enroll from 10 or more clinical trial sites about 500 patients who have had a negative prostate biopsy.
The Previstage(TM) GCC Colorectal Cancer Test continued to make commercial progress in the third quarter, with over 50 billable sales and 25 physicians ordering the test this year. Moreover, in order to foster the integration of the test into physicians' standard practice, the Company launched the PIONEER GCC Registry, which aims to enroll 500 patients with a billable test order over the next year in an observational study that will link their GCC test results with the treatment decision and the clinical outcome.
With $17.2 million in cash, DiagnoCure should have the liquidities necessary to carry out its activities for almost two years at the current rate of spending. Management will continue to consider appropriate financing opportunities, including potential partnerships, to support the development of its projects and leverage the value of its pipeline, and will continue to rigorously control its expenses to assure financial stability while remaining committed to its short- and long-term milestones and to its stated vision and business plan.
Results for the third quarter ended July 31, 2009
Total revenues for the third quarter of 2009 were $396,468 compared with $486,074 for the third quarter of 2008. In the third quarter of 2009, royalty revenues amounted to $113,687 compared with $64,239 for the corresponding period of 2008. This increase is mostly attributable to the sales of PROGENSA(R) PCA3 in Europe by Gen-Probe. As part of the amended agreement signed with Gen-Probe on April 29, 2009, DiagnoCure recorded a portion of the annual payment, that is, $145,767 for the third quarter of 2009.
Interest income decreased by $158,670, to $112,232 for the third quarter of 2009 compared with $270,902 for the third quarter of 2008. The decrease is attributable to DiagnoCure's use of fund to finance its operating activities and to the lower interest rates on its investments.
Cost of sales decreased by $70,990 from $87,541 for the third quarter of 2008 to $16,551 for the same quarter of 2009. This decrease is related to the end of direct ImmunoCyt(TM) / uCyt+(TM) sales by DiagnoCure and to the end of prostate cancer related sample sales during the quarter. The cost of sales for this quarter represents the cost related to the Previstage(TM) GCC Colorectal Cancer Staging Test reimbursed.
Operating expenses before stock-based compensation and loss on foreign exchange decreased by $479,551, from $4,301,576 for the third quarter of 2008 to $3,822,025 for the same period of 2009. This decrease reflects the impact of the reduction of the work force in November 2008 and reduction in R D expenses, which were mostly related to the completion of the Previstage(TM) GCC.
Based on the above, for the third quarter of 2009, DiagnoCure recorded a net loss of $4,034,364 or $0.09 per share, compared with $4,207,974 or $0.10 per share for the same period of 2008. These results are substantially in line with Management expectations and reflect the budgeted initiatives undertaken to promote the Previstage(TM) GCC Colorectal Cancer Staging Test.
DiagnoCure (TSX: CUR) is a life sciences company commercializing high-value cancer diagnostic tests and delivering laboratory services that increase clinician and patient confidence in making critical treatment decisions. DiagnoCure Oncology Laboratories, a subsidiary of DiagnoCure Inc., launched in 2008 the Previstage(TM) GCC Colorectal Cancer Staging Test, the first GCC-based molecular test for the management of colorectal cancer. A major study published in the February 18, 2009, edition of the Journal of the American Medical Association demonstrated that GCC, to which DiagnoCure owns exclusive worldwide diagnostic rights, is the strongest independent predictor of colorectal cancer recurrence. The Company has a strategic alliance with Gen-Probe (NASDAQ: GPRO) for the development and commercialization of a second-generation prostate cancer test using PCA3, DiagnoCure's proprietary molecular marker. This test is available through laboratories in the U.S. using PCA3 analyte specific reagents (ASR) from Gen-Probe, in Europe as the CE-marked PROGENSA(R) PCA3(TM) PCA3 in vitro assay, and in Canada. For more information, visit www.diagnocure.com.
This release contains forward-looking statements that involve known and unknown risks, uncertainties and assumptions that may cause actual results to differ materially from those expected. By their very nature, forward-looking statements are based on expectations and hypotheses and also involve risks and uncertainties, known and unknown, many of which are beyond DiagnoCure's control. As a result, investors are cautioned not to place undue reliance on these forward-looking statements. The forward-looking statements regarding the outcome of research and development projects, clinical studies and future revenues are based on management expectations. In addition, the reader is referred to the applicable general risks and uncertainties described in DiagnoCure's most recent Annual Information Form under the heading "Risk Factors". DiagnoCure undertakes no obligation to publicly update or revise any forward-looking statements contained herein unless required by the applicable securities laws and regulations.Ticker Symbol: CUR - U.S. Clinical Trial of the PCA3 Test Started -
SOURCE DiagnoCure Inc.
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