DIAGNOCURE ANNOUNCES THIRD QUARTER 2010 RESULTS
QUEBEC CITY, Sept. 13 /PRNewswire-FirstCall/ - DiagnoCure, Inc. (TSX: CUR), a life sciences company commercializing high-value cancer diagnostic tests and delivering laboratory services, today reported financial and operation results for the third quarter 2010 ended July 31, 2010. The Company announced a net loss of $1,650,593 or $0.04 per share for the third quarter 2010. These results reflect activities undertaken during this quarter and on-going commitment to develop high-value diagnostic tests for the detection and management of cancer. At the end of the quarter, cash, short-term investments and long-term investments stood at $8,182,119.
Highlights of the Third Quarter 2010
On July 29, 2010, during the conference call of their second quarter earnings, Gen-Probe announced that they had completed the data analysis of their pivotal trial on the PCA3 prostate cancer biomarker and are now preparing for a filing with the Food and Drug Administration during their third quarter.
On August 3, DiagnoCure reported that the New York State Department of Health had issued a Clinical Laboratory Permit to DiagnoCure Oncology Laboratories (DOL), the Company's CLIA-approved and CAP-accredited laboratory in West Chester, Pennsylvania. This permit allows the laboratory to process commercial samples originating in New York for the Previstage(TM) GCC Colorectal Staging Test and completes the other licences already received for the rest of the United States. It is also a reflection of the high quality of the test and services offered by DOL.
Also in the third quarter, Chantal Miklosi joined DiagnoCure as the new Chief Financial Officer. Mrs. Miklosi brought over 15 years experience in investment banking and finance.
More recently, in late August, DiagnoCure has retained the services of JMP Securities LLC, to assist the Company in determining the best option to drive the growth of its U.S. based subsidiary, DiagnoCure Oncology Laboratories. One of these options may include investments from partnerships or investors with dilution only occurring at DiagnoCure's ownership of the U.S. laboratory operations, without any diluting effect on the ownership of other assets of the Company, including the exclusive rights to the PCA3 prostate cancer biomarker. JMP was chosen among the best firms, for its track record and specialized expertise in the healthcare industry. In working with JMP, DiagnoCure aims to determine the most effective method to roll out the Company's U.S. colorectal cancer disease management program, and hence maximize the return on investment in terms of long-term shareholder value.
Results for the Third Quarter 2010
Total revenues for the third quarter of 2010 were $355,998 compared with $396,468 for the third quarter of 2009. In the third quarter of 2010, royalty revenues amounted to $174,476 compared with $113,687 for the corresponding period of 2009. Royalty revenues from Gen-Probe increased by $57,280, from $105,380 to $162,660 for the third quarter of 2010. Without the effect of the exchange rate variation, royalty revenues from Gen-Probe would have increased by 48% from US$106,865 for the third quarter of 2009 to US$158,076 for the same quarter of 2010. This increase is mostly attributable to the sales of PROGENSA(R) PCA3 in Europe and the United States by Gen-Probe.
Interest income decreased by $73,822, to $38,410 for the third quarter of 2010 compared with $112,232 for the third quarter of 2009. The decrease is attributable to DiagnoCure's use of fund to finance its operating activities and the lower interest rates on its investments.
Cost of sales decreased by $12,298, from $16,551 for the third quarter of 2009 to $4,253 for the same quarter of 2010, which represents the cost related to the Previstage(TM) GCC Colorectal Cancer Staging Test reimbursed.
Operating expenses decreased by $2,440,452, from $4,442,790 for the third quarter of 2009 to $2,002,338 for the third quarter of 2010. This decrease reflects the impact of the enterprise structure optimization announced in February.
Based on the above, for the third quarter of 2010, DiagnoCure recorded a net loss of $1,650,593 or $0.04 per share, compared with $4,034,364 or $0.08 per share, for the same period of 2009.
Financial Data
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For the Third Quarter
Ended July 31
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2010 2009
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$ $
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Sales 8,868 24,782
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Revenue under research and license agreement 308,720 259,454
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Interest 38,410 112,232
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Total revenues 355,998 396,468
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Cost of sales 4,253 16,551
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Gross margin 351,745 379,917
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Operating expenses (before stock-based
compensation and loss (gain on foreign
exchange) 1,917,576 3,822,025
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Net loss (before stock-based compensation) (1,565,831) (3,442,108)
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Stock-based compensation 120,516 141,177
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Loss (gain) on foreign exchange (35,754) 479,588
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Net loss before income taxes (1,650,593) (4,062,873)
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Future income taxes - 28,509
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Net loss (1,650,593) (4,034,364)
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Basic and diluted loss per share (0.04) (0.09)
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Weighted average number of common shares
outstanding 42,976,140 42,849,475
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Consolidated Balance Sheets
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As of July 31
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2010 2009
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$ $
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Cash, cash equivalents, temporary and
long-term investments 8,182,119 17,249,422
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Total assets 18,492,733 29,340,753
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Shareholders' equity 15,896,356 25,842,928
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About DiagnoCure
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. More clinical studies are underway to confirm the clinical utility of the Previstage(TM) GCC test. 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. and in Canada using PCA3 analyte specific reagents (ASR) from Gen-Probe, in Europe as the CE-marked PROGENSA(R) PCA3 in vitro assay. Gen-Probe recently completed a 500-patient clinical study aimed at securing FDA approval for the commercialization of the PROGENSA(R) PCA3 test in the U.S. and is on target to file a PMA by the end of the year. 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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