DiagnoCure 2012 third quarter highlights and results
Positive independent market research data on PCA3
QUEBEC CITY, Sept. 6, 2012 /PRNewswire/ - DiagnoCure Inc. (TSX: CUR), a Quebec life sciences company that develops and commercializes high-value cancer diagnostic tests, today reported financial and operation results for its third quarter 2012. The Company announced a net loss from continuing operations of $606,049 or $0.01 per share for the third quarter ending July 31, 2012, compared to a net loss of $892,216 or 0.03$ per share for the same quarter of 2011. At the end of the quarter, cash, short-term investments and long-term investments stood at $6,487,969.
Third Quarter 2012 Highlights
- On June 14, a few months after its FDA's approval, LifeSci Advisors, LLC, a leading provider of investment research and investor relations services in the life sciences sector, published positive independent market research data on the PCA3 assay. The survey, which was conducted among 273 practicing urologists who answered questions about their expected use of the PCA3 assay in men suspected of having prostate cancer, showed that interest in this test is high in the urologist's community. Almost half of the responding urologists indicated their intent to test their patients with this assay, 47% reported that they may use it, and only 4% did not expect to use the test.
- The PCA3 test continues to be highly profiled at major medical meetings, while the debate in the clinical community on the most effective way to screen for prostate cancer continues. At the end of May, when the US Preventive Services Task Force (USPSTF) issued its final recommendation issued against the routine use of prostate‐specific antigen (PSA) for screening for prostate cancer, the American Urological Association (AUA) publicly criticized it while a debate of leading urologists highlighted the value of the PCA3 test, which incidentally was featured in no less than 14 presentations at the last AUA meeting.
- At the end of the quarter, Gen-Probe, our exclusive licensee for PCA3's diagnostic applications was acquired and became a wholly-owned subsidiary of Hologic Inc. that now operates under the name Hologic Gen-Probe. The transaction closed on August 1, 2012; the medium and long-term impact on PCA3 sales has yet to be fully determined.
Third Quarter 2012 Results
The Company' financial statements for the period ended July 31, 2012 have been prepared in accordance with IAS 34, Interim Financial Reporting, International Financial Reporting Standards (IFRS). Comparative unaudited consolidated condensed financial statements for 2011 have been adjusted to reflect the Company's adoption of IFRS on a retrospective basis, effective November 1, 2010.
Total revenues for the third quarter of 2012 were $709,754 compared with $292,073 for the same period of 2011. In the third quarter of 2012, royalty revenues amounted to $142,102 compared with $168,273 for the corresponding period of 2011. Royalty revenues from Gen-Probe decreased by $18,182 to $136,843 for the third quarter of 2012, from $155,025 for the same period of 2011. This decrease is attributable to sales in Europe reflecting the general softness in the European markets due to austerity measures. Royalty revenues from Scimedx, related to ImmunoCytTM / uCyt+TM, decreased by $7,989 to $5,259 for the third quarter of 2012, from $13,248 for the same period of 2011. In the third quarter of 2012, DiagnoCure provided to a subsidiary of Signal Genetics R&D services related to the PrevistageTM GCC Colorectal Cancer Staging test for an amount of $567,652, for a total in accounts receivable of $707,012. We have been advised that Signal Genetics has closed its laboratory in Pennsylvania on July 31, 2012, and is no longer performing the Previstage test. As of July 31st, Signal Genetics has not made the royalty payment required for the second calendar quarter of 2012. While we intend to enforce our rights under our agreements with Signal Genetics, there can be no assurance that Signal Genetics will pay us any further amounts under the R&D agreement, or any royalties due. Pursuant to FDA approval of the PROGENSA® PCA3 test on February 15, 2012, DiagnoCure didn't record revenues in the third quarter of 2012, compared with $123,801 for the third quarter of 2011. The 2009 amended agreement with Gen-Probe contained an FDA submission milestone that had to be paid on January 31st of each year until said milestone was reached. As a result of the PROGENSA® PCA3 test having been approved, all the conditions in the amendment have been met. Accordingly, DiagnoCure recorded the full 2012 payment as revenues in the second quarter of 2012.
Operating expenses increased by $131,514, to $1,315,803 for the third quarter of 2012 from $1,184,289 for the same period of 2011. This increase is mainly attributable to the R&D services performed in support to the PrevistageTM GCC Colorectal Cancer Staging Test. Total operating expenses increased primarily as a result of the following:
- Research and development expenses, net of investment tax credits, increased by $187,122, to $755,819 for the third quarter of 2012 from $568,697 for the same period of 2011. This increase in research and development expenses is attributable to the R&D services provided in relation with the PrevistageTM GCC Colorectal Cancer Staging test.
- General and administrative expenses decreased by $63,748, to $516,995 for the third quarter of 2012 from $580,743 for the same period of 2011. This decrease is attributable to reduction in professional fees and stock-based compensation expenses allowance.
- Selling and business development expenses increased by $23,044, to $67,319 for the third quarter of 2012 from $44,275 for the same period of 2011. This increase is attributable to professional fees.
Based on the above, for the third quarter of 2012, DiagnoCure recorded a net loss from continued operations of $606,049 or $0.01 per share, compared with $892,216 or $0.03 per share for the same period of 2011.
Financial Data
| For the Third Quarter Ended July 31 | ||
| 2012 | 2011 | |
| $ | $ | |
| Total revenues | 709,754 | 292,073 |
| Operating expenses (before stock-based compensation and amortization) | 1,029,933 | 803,950 |
| Net loss from continuing operations (before stock-based compensation and amortization) | (320,179) | (511,877) |
| Stock-based compensation | 43,356 | 65,416 |
| Amortization | 242,514 | 314,923 |
| Net loss from continuing operations | (606,049) | (892,216) |
| Basic and diluted loss per share: | (0.01) | (0.03) |
| Weighted average number of common shares outstanding | 43,033,471 | 42,993,997 |
Consolidated Statements of Financial Position
| As of July 31, 2012 | As of October 31, 2011 | |
| $ | $ | |
| Cash, cash equivalents, temporary and long-term investments | 6,487,969 | 8,883,528 |
| Total assets | 13,327,223 | 15,793,209 |
| Shareholders' equity | 12,380,496 | 13,932,708 |
Conference call with investors
Investors and financial analysts wishing to participate to the "DiagnoCure Q3 2012 Earnings Announcement" conference call to be held today, September 6, 2012 at 4:30 p.m. (EDT) shall dial the toll-free number 1-888-231-8191, and provide the conference ID number: 11370258.
The event will also be webcasted live on DiagnoCure's website at www.diagnocure.com, through the hyperlink under the "Presentations" page of the "Investors" tab. A replay of the audio conference will be available on September 10, 2012.
About DiagnoCure
DiagnoCure (TSX: CUR) is a life sciences company that develops and commercializes high-value cancer diagnostic tests that increase clinician and patient confidence in making critical treatment decisions. In 2008, the Company launched the PrevistageTM GCC Colorectal Cancer Staging Test through its U.S. CLIA laboratory, and granted the worldwide exclusive rights to this test to Signal Genetics in June 2011. The Company has also granted a worldwide exclusive license agreement to Gen-Probe, now a wholly-owned subsidiary of Hologic Inc. (HOLX:NASDAQ) operating as Hologic Gen-Probe, for the development and commercialization of a third-generation prostate cancer test using PCA3, DiagnoCure's proprietary molecular biomarker. Gen-Probe's PROGENSA® PCA3 test is commercialized in Europe under CE mark and is approved for commercialization in Canada and the United States. For more information, visit www.diagnocure.com.
Forward‐looking statements
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.
SOURCE DIAGNOCURE INC.
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