- Signs Agreement with First-Ever Direct Access Lab Testing Provider in the U.S. -
- All testing capabilities and activities successfully brought back online at Company's Virginia-based Innovative Diagnostic Laboratory ("IDL") clinical reference lab.
- More than 1,000 physicians, complemented by their associated nurse practitioners and physician assistants, are now enrolled in the IDL system; efforts are currently focused on initiating testing at all enrolled practices.
- Test volumes are starting to grow commensurately with enrolled practices initiating patient testing
- Signed second partnership agreement with a large, multi-specialty physician group in the American Midwest for use of GeneNews' cancer diagnostic tests.
- BreastSentry® diagnostic test for the early detection of breast cancer successfully launched to the U.S. market.
TORONTO, May 11, 2017 /PRNewswire/ - GeneNews Limited (TSX:GEN) ("GeneNews" or the "Company") today announced operational and financial results for the three-month period ended March 31, 2017, and provided a progress update on its business.
"The first quarter of 2017 has seen the full resumption of our business," commented James R Howard-Tripp, GeneNews' Chairman and CEO. "In particular, Q1 was marked by the full resumption of testing activities at IDL, the signing of the second partnership agreement with a U.S. healthcare services group, and the launch of a major new diagnostic test, BreastSentry®, for the early detection of breast cancer. In addition to these highlights, GeneNews continued to market its early cancer diagnostic testing through an aggressive outreach campaign to hospitals, clinically integrated networks, large physician groups and other healthcare providers, which is expected to significantly grow our list of users. Overall, the process to "build-up" the business is going well, and puts us in a strong position for the remainder of 2017."
Collection Partnership Agreement with Any Lab Test Now
GeneNews announced today that IDL has signed a Collection Partnership Agreement (the "Collection Partnership") with Any Lab Test Now® ("ALTN"), pursuant to which IDL will offer all of its early cancer tests, including ColonSentry®, EarlyCDT®-Lung, PHI and BreastSentry®, as well as supportive tests, to physicians and patients via ALTN's 165 locations spread across the United States.
"The agreement with ALTN very significantly expands our reach and, together with our existing clients, will allow us to offer our early cancer diagnostic tests throughout much of the U.S.," said Mr. Howard-Tripp. "During April, we received over 3,000 requests for information, most of which were from physicians and patients asking where they could gain access to our tests. This partnership now allows us to link patients and physicians and give them immediate access to locations across the country where IDL testing can be initiated."
GeneNews expects the Collection Partnership activities to officially launch before the end of May.
Q1-2017 Financial Results
Effective July 1, 2015, GeneNews changed its functional and presentation currency to U.S. dollars given the increasing prevalence of U.S. dollar denominated activities of the Company over time. These first quarter 2017 financial results are presented in U.S. dollars and prior period comparable information is restated to reflect the change in presentation currency. Results are reported in accordance with International Financial Reporting Standards.
Total revenue for the three-months ended March 31, 2017 was approximately $0.2 million, compared to $0.1 million for the same period in 2016. For the three-month period ended March 31, 2017, GeneNews reported a consolidated net loss of $1.5 million, or $0.02 loss per common share, as compared with a consolidated net loss of $2.7 million, or $0.05 loss per common share, for the three-month period ended March 31, 2016. The $1.2 million decrease in the loss results from the $1.1 million impairment charge taken in 2016 for goodwill from the acquisition of the remaining 50% of IDL, $0.4 million share of loss in IDL (taken until March 15, 2016 when the Company acquired full interest in IDL), $0.2 million decline in loss from revaluation of warrants, $0.2 million in cost of goods sold related to IDL's operations, $0.1 million increase in recognized revenue, offset by $0.4 million increase in general and administrative costs, $0.2 million increase in cost of goods sold, $0.1 million increase in change in fair value of conversion liabilities and $0.1 million increase in finance costs.
The Company had approximately $0.1 million in cash and cash equivalents as at March 31, 2017.
"While not yet reflected in the Company' financial results, we fully anticipate that our recognized revenue will begin to grow in the months ahead as the tests being performed at IDL translate into collected revenue," added Howard-Tripp.
The Company's financial statements and management's discussion and analysis are available on www.sedar.com.
Financing Activities and Capital Structure
During the first quarter of 2017, under its capital commitment agreement with GEM Global Yield Fund LLC SCS ("GEM") and its convertible notes (the "Notes") financing agreement with Alumina Partners LLC ("Alumina"), GeneNews secured approximately $1.3 million in additional funding, most of which was used to support the full resumption of testing activities at IDL, to fund the cost of goods associated with the resulting increased testing volumes, to support the BreastSentry® commercial launch, and to make meaningful progress in reducing GeneNews' trade payables.
In connection with these financing activities, the Company issued 2,730,000 common shares and 1,610,000 warrants to GEM and 3,544,398 common shares to Alumina.
"It is important to note that the approximate 6.3 million common shares issued during the first quarter do not directly correlate with the Company's financing activities within only that period," said Mr. Howard-Tripp. "For example, under the agreement with GEM, common shares issued during Q1-2017 reflect drawdowns made in the quarter, as well as some made in Q4-2016. In addition, pursuant to the Alumina agreement, the issuance of common shares is at the discretion of Alumina upon conversion of the Notes, and can therefore reflect conversion of Notes issued at any time in the previous year."
GeneNews, an innovator in the liquid biopsy space, is committed to becoming a leader in advanced diagnostics and personalized medicine, serving as a strong commercialization outlet for early detection of cancer and other chronic diseases. Our mission is to identify, assess and make commercially available a comprehensive menu of diagnostics that provide physicians and patients with personalized clinical intelligence and actionable information to improve health out-comes through the early diagnosis of disease. Our Richmond, Virginia-based Innovative Diagnostic Laboratory clinical reference lab specializes in traditional and advanced clinical evidence-based blood testing that helps find, understand, and address cancer risk in patient populations. Currently, IDL offers risk assessment blood tests for four prevalent cancer types - colon, lung, prostate and breast. GeneNews' common shares trade on the Toronto Stock Exchange under the symbol 'GEN'. More information on GeneNews and IDL can be found at www.GeneNews.com and www.myinnovativelab.com, respectively.
This press release contains forward-looking statements identified by words such as "expects", "will" and similar expressions, which reflect the Company's current expectations regarding future events. The forward-looking statements involve risks and uncertainties that could cause the Company's actual events to differ materially from those projected herein. Investors should consult the Company's ongoing quarterly filings and annual reports for additional information on risks and uncertainties relating to these forward-looking statements. The reader is cautioned not to rely on these forward-looking statements. The Company disclaims any obligation to update these forward-looking statements, except as required by law.
SOURCE GeneNews Limited