DiagnoCure announces third quarter 2011 earnings results
Sep 08, 2011, 04:01 ET
QUEBEC CITY, Sept. 8, 2011 /PRNewswire/ - DiagnoCure, Inc. (TSX: CUR), a life sciences company that develops and commercializes high‐value cancer diagnostic tests, today reported financial and operation results for the third quarter of fiscal 2011. The Company announced a net loss from continuing operations of $912,459 or $0.02 per share, net earnings from discontinued operations of $3,952,095 or $0.09 per share and consolidated net earnings of $3,039,636 for the quarter ended July 31, 2011. At the end of the quarter, cash, short-term investments and long-term investments stood at $8,834,927, including cash and cash equivalent from discontinued operations.
"These financial results largely reflect the transaction with Signal Genetics, which provided a new inflow of cash to DiagnoCure. Added to the royalty revenues from Gen-Probe on the PCA3 genomic biomarker for prostate cancer, DiagnoCure now has gained a financial base to leverage its core expertise in developing novel genomic cancer tests, and take advantage of the fast expanding field of Personalized Medicine," stated Dr. Yves Fradet, President and Chief Medical Officer of the Company.
Highlights of the Third Quarter 2011
On June 15, DiagnoCure reported the issuance of a new U.S. patent, which represents a significant addition to the Company's PCA3 prostate cancer biomarker portfolio. In addition to providing greater patent protection, this new patent bears an extended expiration date that lengthens by 20 months the term of the license that DiagnoCure granted to its commercial partner, Gen-Probe. As a result, the duration of the Gen-Probe license will be extended to August 2027.
On June 29, the Company announced a collaboration arrangement with Signal Genetics valued at a minimum of US$13.3M over the first five years. This collaboration aims to maximize the commercialization of the PrevistageTM GCC Colorectal Cancer Staging Test, and further develop novel genomic cancer tests in the field of Personalized Medicine.
On August 17, DiagnoCure announced that Health Canada had granted regulatory approval to Gen-Probe, the Company's commercial partner for the PCA3 biomarker, for the PROGENSA® PCA3 assay.
Results for the Third Quarter 2011 from Continuing Operations
Total revenues for the third quarter of 2011 were $304,288 compared with $347,130 for the same period of 2010. In the third quarter of 2011, royalty revenues amounted to $168,273 compared with $174,476 for the corresponding period of 2010. Royalty revenues from Gen-Probe decreased by $7,635, to $155,025 for the third quarter of 2011 from $162,660 for the same period of 2010. Without taking into account the effect of the exchange rate variation, royalty revenues from Gen-Probe have increased by 3%, to US$162,534 for the third quarter of 2011 from US$158,076 for the same period of 2010. This increase is attributable to increased sales of PROGENSA® PCA3 in Europe and the United States by Gen-Probe. Also in the third quarter of 2011, DiagnoCure recorded royalties of $13,248 from Scimedx, related to ImmunoCytTM / uCyt+TM, compared with $11,816 for the same period of 2010.
Interest income decreased by $26,195, to $12,215 for the third quarter of 2011 from $38,410 for the same period of 2010. The decrease is attributable to DiagnoCure's use of funds to finance its operating activities.
Operating expenses increased by $78,955, to $1,244,631 for the third quarter of 2011 from $1,165,676 for the same period of 2010. This increase is attributable to administrative professional fees related to the IFRS transition and to consulting fees.
Based on the above, for the third quarter of 2011, DiagnoCure recorded a net loss from continuing operations of $912,459 or $0.02 per share, compared with $818,546 or $0.02 per share, for the same period of 2010.
Financial Data from Continuing Operations
|For the third quarter ended July 31|
|Revenue under research and license agreement||292,073||308,720|
|Operating expenses (before stock-based compensation)||1,158,972||1,045,160|
|Net loss from continuing operations (before stock-based compensation)||(854,684)||(698,030)|
|Net loss before income taxes||(940,343)||(818,546)|
|Future income taxes||27,884||―|
|Net loss from continuing operations||(912,459)||(818,546)|
|Net earnings (loss) from discontinued operations||3,952,095||(832,047)|
|Net earnings (loss)||3,039,636||(1,650,593)|
|Basic and diluted net earnings (loss) per share|
|From continuing operations||(0.02)||(0.02)|
|From discontinued operations||0.09||(0.02)|
|Basic and diluted net earnings (loss) per share||0.07||(0.04)|
|Weighted average number of common shares outstanding||42,993,997||42,976,140|
Consolidated Balance Sheets
|As of July 31|
|Cash, cash equivalents, temporary and long-term investments||8,834,927||8,182,119|
Results for the Third Quarter 2011 from Discontinued Operations
Total revenues for the third quarter of 2011 were $80,754 compared with $8,868 for the same period of 2010. During the third quarter, DiagnoCure received reimbursement for its PrevistageTM GCC Colorectal Cancer Staging Test for an amount of $80,754 compared with $8,868 for the same period of 2010.
Cost of sales increased by $36,931, to $41,184 for the third quarter of 2011 from $4,253 for the same quarter of 2010. The cost of sales represents the cost related to the PrevistageTM GCC tests reimbursed.
Operating expenses decreased by $480,775, to $355,887 for the third quarter of 2011 from $836,662 for the same period of 2010. This decrease is attributable to reduced expenses in R&D and selling and business development.
Also during the quarter, DiagnoCure sold its U.S. CLIA laboratory operations for $5.5M (US$5.7M). This transaction resulted in a net gain on disposal of discontinued assets of $4,327,824.
Based on the above, for the third quarter of 2011, DiagnoCure recorded net earnings from discontinued operations of $3,952,095 or $0.09 per share, compared with a loss of $832,047 or $0.02 per share, for the same period of 2010.
Financial Data from Discontinued Operations
|For the third quarter ended July 31|
|Cost of sales||41,184||4,253|
|Operating loss before income taxes||(316,317)||(832,047)|
|Net gain on disposal of discontinued assets||4,327,824||―|
|Net (loss) earnings from discontinued operations||3,952,095||(832,047)|
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 also 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 biomarker. The PROGENSA® PCA3 test is commercialized in Europe under CE mark and was recently approved in Canada; in the United States, the test is commercialized through clinical laboratories using PCA3 analyte specific reagents from Gen‐Probe; a PMA application was filed with the FDA. 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.
SOURCE DIAGNOCURE INC.
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