DiagnoCure announces fourth quarter 2012 and year-end results
All commercial rights to Previstage™ GCC Colorectal Cancer Staging Test returned to DiagnoCure
QUEBEC CITY, Jan. 11, 2013 /PRNewswire/ - DiagnoCure, Inc. (TSX: CUR) today reported financial and operational results for the fourth quarter 2012 and fiscal year ended October 31, 2012. The Company announced a net loss from continuing operations of $1,978,355 or $0.05 per share for the fourth quarter ending October 31, 2012, and a net loss of $3,679,324 or $0.09 per share for fiscal year 2012. At the end of the quarter, cash, short-term investments and long-term investments stood at $5,824,771.
Recent Highlights
Following the departure of three members of its Board of directors, on November 26, 2012, DiagnoCure announced the appointment of two new members to its Board. The new directors are Dr. Jacques Simoneau, President and CEO of Gestion Univalor L.P. and Mr. Andrew J. Sheldon, President and CEO of Medicago inc. The Corporation believes that the arrival of these two experienced directors, who will stand for re-election at DiagnoCure's next annual meeting of shareholders, contributes to diversification of the outstanding talents and wide-ranging experience on the board.
The development and license agreements between DiagnoCure and Signal Genetics entered into in June 2011 have been terminated. As a result, DiagnoCure has regained all commercial rights and complete control of all intellectual property relating to its GCC biomarker and is released from any and all future obligations to Signal Genetics. The settlement amount of US$200K takes into account the inherent risks of litigation and the fact that DiagnoCure received US$6.2M both from the sale of its U.S. laboratory and the development agreement.
Results for the Fiscal Year Ended October 31, 2012
Total revenues for fiscal year 2012 were $2,472,038 compared with $1,241,781 for 2011. In 2012, royalty revenues amounted to $622,152 compared with $659,120 for 2011. Royalty revenues from Hologic Gen-Probe decreased by $17,673 to $587,615 for fiscal year 2012, from $605,288 for 2011. This decrease is attributable to sales in Europe reflecting the general softness in the European markets due to austerity measures. In contrast, U.S. royalty revenues increased by 17% from 2011. Royalty revenues from Scimedx, related to ImmunoCytTM / uCyt+TM, decreased by $25,767, from $44,244 for 2011 to $18,477 for 2012. The 2012 ImmunoCytTM / uCyt+TM royalties represent the last receivable as the contractual agreement with Scimedx has expired. Following the agreement with Signal Genetics, DiagnoCure recorded PrevistageTM GCC royalties of $16,060 in 2012 compared to $9,588 for 2011. In fiscal year 2012, DiagnoCure provided to a subsidiary of Signal Genetics R&D services in support to the PrevistageTM GCC Colorectal Cancer Staging Test for an amount of $1,223,485, for a total in accounts receivable of $707,012. In connection with the settlement with Signal Genetics, DiagnoCure has taken a provision for doubtful accounts of $507,092 related to the accrued accounts receivable. Pursuant to FDA approval of the PROGENSA® PCA3 test on February 15, 2012, DiagnoCure recorded an annual payment of $626,401 for 2012, compared with $502,491 for 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 decreased by $347,857, to $6,151,362 for fiscal year 2012 from $6,499,219 for fiscal year 2011. This decrease is mainly attributable to impairment and financial expenses. Based on the above, for fiscal year 2012, DiagnoCure recorded a net loss from continued operations of $3,679,324 or $0.09 per share, compared with $5,257,438 or $0.12 per share for fiscal year 2011.
Results of the Fourth Quarter 2012
Total revenues for the fourth quarter of 2012 were $142,995 compared with $345,923 for the same period of 2011. In the fourth quarter of 2012, royalty revenues amounted to $142,995 compared with $141,951 for the corresponding period of 2011. Royalty revenues from Hologic Gen-Probe increased by $11,753 to $137,097 for the fourth quarter of 2012, from $125,344 for the same period of 2011. In the fourth quarter of 2011, DiagnoCure recorded royalties of $7,019 from Scimedx, related to ImmunoCytTM / uCyt+TM. As the contractual agreement with Scimedx has expired, DiagnoCure did not recognize royalty revenues in the fourth quarter of 2012. Following the agreement signed with Signal Genetics, DiagnoCure recorded PrevistageTM GCC royalties of $5,898 in the fourth quarter of 2012 compared with $9,588 in the fourth quarter of 2011. In the fourth quarter of 2011, DiagnoCure had sold clinical samples to Signal Genetics to support their lung cancer testing R&D for an amount of $82,632. There were no sales of samples for the same period of 2012. Pursuant to the amendment agreement signed with Gen-Probe on April 29, 2009, DiagnoCure recorded a portion of the annual payment, that is, $123,802 for the fourth quarter of 2011.
Operating expenses decreased by $519,132, to $2,121,350 for the fourth quarter of 2012, from $2,640,482 for the same quarter of 2011. This decrease is mostly attributable to the impairment charges on the SHC technology and to foreign currency translation related to discontinued operations. Based on the above, for the fourth quarter of 2012, DiagnoCure recorded a net loss of $1,978,355 or $0.05 per share, compared with $2,294,559 or $0.06 per share, for the same period of 2011.
Financial Data
| For the periods of | Three months ended October 31 |
Years ended October 31 |
||
| 2012 | 2011 | 2012 | 2011 | |
| $ | $ | $ | $ | |
| Sales net of cost of sales | ― | 80,170 | ― | 80,170 |
| Revenue under research agreement | ― | ― | 1,223,485 | ― |
| Revenue under license agreement | 142,995 | 265,753 | 1,248,553 | 1,161,611 |
| Total revenues | 142,995 | 345,923 | 2,472,038 | 1,241,781 |
| Operating expenses (before stock-based compensation, depreciation, amortization, impairment and foreign currency translation) | 1,191,988 | 675,903 | 4,356,094 | 3,337,648 |
| Net loss (before stock-based compensation, depreciation, amortization, impairment and foreign currency translation) | (1,048,993) | (329,980) | (1,884,056) | (2,095,867) |
| Stock-based compensation | 43,356 | 57,590 | 179,713 | 293,566 |
| Depreciation of property, plant and equipment | 24,019 | 40,114 | 118,578 | 188,072 |
| Amortization of intangible asset | 211,987 | 271,234 | 846,977 | 1,084,292 |
| Impairment of intangible asset | 650,000 | 713,046 | 650,000 | 713,046 |
| Foreign currency translation | ― | 882,595 | ― | 882,595 |
| Net loss from continuing operation | (1,978,355) | (2,294,559) | (3,679,324) | (5,257,438) |
| Basic and diluted net loss per share | (0.05) | (0.06) | (0.09) | (0.12) |
| Weighted average number of common shares outstanding | 43,029,037 | 42,993,274 | 43,029,037 | 42,993,274 |
Consolidated Balance Sheets
| As of October 31 | ||
| 2012 | 2011 | |
| Cash, cash equivalents, temporary and long-term investments | 5,824,771 | 8,883,528 |
| Total assets | 11,256,369 | 15,793,209 |
| Shareholders' equity | 10,448,087 | 13,932,708 |
| Number of Shares | 43,040,471 | 43,013,471 |
Conference call
DiagnoCure's management will host a conference call at 4:30 p.m. (EST) on January 11, 2013. Interested participants may listen to the call by dialing 1-888-231-8191 or 514-807-9895 and referencing code 86003400 approximately 15 minutes prior to the call. The Corporation will also provide a live webcast of the call. Interested participants may access the webcast on DiagnoCure's website at www.diagnocure.com, through a link on the Investors page - Presentations. A replay of the webcast will be available on DiagnoCure's website for those unable to participate in the live webcast.
About DiagnoCure
DiagnoCure (TSX: CUR) is a life sciences corporation that develops and commercializes high-value cancer diagnostic tests that increases clinician and patient confidence in making critical treatment decisions. In 2008, the Corporation launched the PrevistageTM GCC Colorectal Cancer Staging Test through its U.S. CLIA laboratory. The Corporation then granted a worldwide exclusive license to this test to Signal Genetics in June 2011, which was subsequently terminated in January 2013. The Corporation has also granted a worldwide exclusive license agreement to Gen-Probe, now a wholly-owned subsidiary of Hologic Inc. (NASDAQ: HOLX) operating as Hologic Gen-Probe, for the development and commercialization of a 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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