First Diagnostic Test Based on Company's microRNA Technology Submitted for Regulatory Approval to the New York State Department of Health by Columbia
University Medical Center Additional West Coast Clinical Laboratory to Validate and Offer Tests Based
on Rosetta Genomics' microRNA Technology
Two Additional microRNA-Related Patents Allowed
REHOVOT, Israel and NORTH BRUNSWICK, New Jersey, May 21 /PRNewswire-FirstCall/ -- Rosetta Genomics, Ltd. (NASDAQ: ROSG), a leading molecular diagnostics company, reported today its consolidated financial results for the quarter ended March 31, 2008 and business highlights.
The 2008 first-quarter net loss of $3.9 million (including a non-cash expense of $191,000 related to stock based compensation), or $0.33 per ordinary share. The first-quarter result compares with a net loss of $2 million (including a non-cash expense of $205,000 related to stock based compensation), or $0.23 per ordinary share, for the corresponding quarter of 2007.
"This has been a remarkable quarter for us at Rosetta Genomics on both the business and scientific fronts," said Amir Avniel, President and CEO of Rosetta Genomics. "We have continued the rapid advancements towards the launch of the first diagnostic tests based on our microRNA technology, and look forward to the exciting events that lay ahead of us in the following months."
On the business front, Rosetta Genomics recently announced that Columbia University Medical Center's Molecular Pathology Laboratory has submitted the first microRNA-based test based on the company's microRNA technology for regulatory approval to the New York State Department of Health. The test is designed to differed development, net $ 6,400 $ 4,781 $ 2,389 $ 1,161
Marketing and business
development 1,742 1,504 511 375
General and administrative 2,903 1,860 829 680
Operating loss 11,045 8,145 3,729 2,216
Financial expenses (income),
net 3,616 (538) 149 (200)
Net loss $ 14,661 $ 7,607 $ 3,878 $ 2,016
Basic and diluted net loss
per Ordinary share $ 1.32 $ 2.98 $ 0.33 $ 0.23
Weighted average number of
Ordinary shares used to
compute basic and diluted
net loss per Ordinary share 11,142,149 2,551,860 11,920,401 8,874,841
In addition, the company recently announced an agreement with the University of California, Irvine School of Medicine to develop diagnostic tests based on Rosetta's proprietary microRNA technology.
On the scientific front, in a paper published in the April issue of Nature Biotechnology, Rosetta Genomics and collaborators demonstrated the significant potential of microRNAs to be used as biomarkers for diagnosing the primary tumor site in patients with cancer of unknown primary (CUP). The company expects a CUP test based on its microRNA technology to be submitted for regulatory approval by a CLIA certified lab by the end of 2008.
Operating loss for the first quarter of 2008 was $3.7 million (including a non-cash expense of $191,000 related to stock based compensation), compared with an operating loss of $2.2 million (including a non-cash expense of $205,000 related to stock based compensation) for the corresponding quarter of 2007. Net loss for the first quarter of 2008 was $3.9 million, or $0.33 per ordinary share, compared with a net loss of $2 million, or $0.23 per ordinary share, for the corresponding quarter of 2007.
Research and development expenses of $2.4 million for the first quarter of 2008, compared to $1.2 million for the first quarter of 2007, remain the Company's largest expense and accounted for 64% of its operating losses.
As of March 31, 2008 we had $18.6 million in cash, cash equivalents, short and long term bank deposits and marketable securities. Our outlook of total cash usage for operating activities for the next nine month of 2008 is approximately $10 million.
As previously announced, the Company continues to receive interest payments from its auction rate securities, which all but two are rated AAA. However, due to the continuing uncertainty in the credit market, the company recorded an impairment of $300,000 during the first quarter.
Rosetta Genomics reports the following scientific and corporate highlights:
- Squamous vs. Non Squamous non-small cell lung cancer (NSCLC) - Columbia University Medical Center's Molecular Pathology Laboratory has submitted this test, designed to differentiate squamous from non squamous non-small cell lung cancer (NSCLC) using a single microRNA, for regulatory approval to the New York State Department of Health. The approval process is estimated to take 2-6 months.
The ability of physicians to accurately differentiate squamous from non-squamous NSCLC is an important treatment guide. Bevacizumab, an angiogenesis inhibitor and an important new modality of therapy for non-squamous NSCLC, includes a black-box warning about substantially higher rates of severe or fatal hemorrhage among patients with squamous NSCLC histology compared with non-squamous NSCLC.
- Mesothelioma vs. Adenocarcinoma - Differentiating between mesothelioma and adenocarcinoma is critical for optimal therapy, but it is often difficult to differentiate these tumors. Currently, there is no objective, standardized test to aid pathologists in differentiating between the many possible tumors in the lung and pleura. Based on a few microRNA biomarkers that were identified applying Rosetta Genomics' technology, a test is being developed to separate mesothelioma from adenocarcinoma tumors including lung adenocarcinoma and metastases to the lung or to the pleura. This test is expected to be filed for regulatory approval in H2 2008.
- Cancer of Unknown Primary (CUP) - We continued to advance assay development of a microRNA-based test for cancer of unknown primary (CUP). As demonstrated in a paper published by Rosetta Genomics and collaborators in the April issue of Nature Biotechnology, the test is being developed to distinguish among more than 20 possible tissues of origin, and it is expected to be submitted for regulatory approval in H2 2008.
- Additional diagnostic tests - We continued the expansion of our microRNA-based diagnostic pipeline with cancer-related indications and indications related to women's health.
- Identified microRNAs that are potential biomarkers for differential diagnosis of the following in lung cancer: primary vs. metastases, non-small cell lung cancer vs. small-cell lung cancer, neuroendocrine tumors vs. non-small cell lung cancer, lung cancer vs. thymoma, and carcinoid vs. other neuroendocrine tumors.
- Identified specific microRNAs that are markers to differentiate between primary liver and brain tumors and metastases to these organs.
- Women's health: Demonstrated correlation between microRNAs in serum and physiological conditions.
Collaborations and Licensing
- Initiated a collaboration with the Henry Ford Health System in Detroit, Michigan, to develop microRNA-based diagnostics and prognostics for brain cancer. Under the collaboration, the parties will conduct a genome-wide molecular analysis of human brain cancer tumors to identify unique microRNA biomarkers that have diagnostic and prognostic potential.
- Signed an agreement with University of California, Irvine School of Medicine, relating to the development and validation of diagnostic tests based on the company's microRNA technology. The tests are designed to differentiate squamous versus non-squamous lung cancer, differentiate mesothelioma from adenocarcinoma, and identify cancers of unknown primary (CUP) origin.
- The U.S. Patent and Trademark Office (USPTO) has issued a Notice of
Allowance for two of the company's patent applications on human
(10/604,726) and viral (10/604,942) microRNAs. The first allowed patent
application (10/604,726) is related to two clustered human hairpins and
their related microRNAs. The second allowed patent application (10/604,942)
is related to microRNA US5-1, a viral microRNA found in Human
cytomegalovirus (HCMV), a member of the herpes virus family.
Conferences and Events
Rosetta Genomics presented at the following conferences and events:
- European Society for Medical Oncology (ESMO) 1st European
Lung Cancer Conference, April 23-26, Geneva, Switzerland
- American Association for Cancer Research (AACR) Annual
Meeting- April 12-16, San Diego, California
- Cambridge Healthtech Institute's (CHI) MicroRNA in Human
Disease and Development Conference, March 10-11, Boston, Massachusetts.
- Keystone Symposia, RNAi, MicroRNA, and Non-Coding RNA, March
25-29, Whistler, Canada
Rosetta Genomics will present at the following upcoming event:
- ASCO Annual Meeting, May 30-June 3, Chicago, Illinois.
Conference Call Information
Rosetta Genomics will host a conference call at 8:30 a.m. ET today to discuss first-quarter activities and recent corporate developments. To access the live conference call, U.S. and Canadian participants may dial 1-866- 966-5335; international participants may dial +44-20-3023-4460. To access the 24-hour audio replay, U.S. and Canadian participants may dial 1-866-583-1035; international participants may dial +44-20-8196-1998. The access code for the replay is 181543#. The replay will be available until May 28, 2008.
A live audio webcast of the call will also be available on the "Investors" section of the company's website http://www.rosettagenomics.com. An archived webcast will be available on the Company's website approximately two hours after the event, and will be archived for 30 days thereafter.
MicroRNAs (miRNAs) are recently discovered, naturally occurring, small RNAs that act as master regulators and have the potential to form the basis for a new class of diagnostics and therapeutics. Since many diseases are caused by the abnormal activity of proteins, the ability to selectively regulate protein activity through microRNAs could provide the means to treat a wide range of human diseases. In addition, microRNAs have been shown to have different expression in various pathological conditions. As a result, these differences may provide for a novel diagnostic strategy for many diseases.
About Rosetta Genomics
Rosetta Genomics (Nasdaq: ROSG) is a leader in the field of microRNA. Founded in 2000, the company's integrative research platform combining bioinformatics and state-of-the-art laboratory processes has led to the discovery of hundreds of biologically validated novel human microRNAs. Building on its strong IP position and proprietary platform technologies, Rosetta Genomics is working on the application of these technologies in the development of a full range of microRNA-based diagnostic and therapeutic tools, focusing primarily on cancer and various women's health indications. The company expects that the first microRNA diagnostic tests applying its technology will be launched by licensed clinical laboratories in the United States in 2008.
Forward-Looking Statement Disclaimer
Various statements in this release concerning Rosetta's future
expectations, plans and prospects, including without limitation, statements
relating to the role of microRNAs in human physiology and disease, the
potential of microRNAs in the development of therapeutics and diagnostic
products, the progress and timing of our diagnostic and therapeutic
programs, including the expected launch of the first diagnostic tests
applying Rosetta Genomics' technology in 2008, and Rosetta's expected cash
usage in 2008 constitute forward-looking statements for the purposes of the
safe harbor provisions under The Private Securities Litigation Reform Act
of 1995. Actual results may differ materially from those indicated by these
forward-looking statements as a result of various important factors,
including risks related to: the continued uncertainty in the credit and
capital markets that may result in these markets deteriorating further or
Rosetta experiencing additional ratings downgrades on any ongoing
investments in its portfolio (including on ARS); changes in the accounting
treatment and final results for 2007 resulting from final third party
valuations of the ARS; the current lack of liquidity of the ARS having a
impact on Rosetta's liquidity, cash flow or its ability to fund its
operations; other changes in general economic and business conditions;
Rosetta's approach to discover and develop novel diagnostics products,
which is unproven and may never lead to marketable products or services;
Rosetta's ability to fund and the results of further pre-clinical and
clinical trials; Rosetta's ability to obtain, maintain and protect the
intellectual property utilized by Rosetta's products; Rosetta's ability to
enforce its patents against infringers and to defend its patent portfolio
against challenges from third parties; Rosetta's ability to obtain
additional funding to support its business activities; Rosetta's dependence
on third parties for development, manufacture, marketing, sales, and
distribution of products and services; the successful development of
diagnostic and therapeutic products applying Rosetta's technology, all of
which are in early stages of development; Rosetta's ability to obtain
regulatory clearances or approvals for products, as may be required under
applicable laws; competition from others using technology similar to
Rosetta's and others developing products for similar uses; Rosetta's
dependence on collaborators; the ability to obtain coverage and payment
from health plans and payers for diagnostic and therapeutic products
applying Rosetta's technology and Rosetta's short operating history; as
well as those risks more fully discussed under "Key Information - Risk
Factors" in Rosetta's Annual Report on Form 20-F for the year ended
December 31, 2006 on file with the Securities and Exchange Commission. In
addition, any forward-looking statements represent Rosetta's views only as
of today and should not be relied upon as representing its views as of any
subsequent date. Rosetta does not assume any obligation to update any
forward-looking statements unless required by law.
ROSETTA GENOMICS LTD. AND ITS SUBSIDIARY
(A development stage company)
CONSOLIDATED BALANCE SHEETS
U.S. dollars in thousands
March 31, December 31,
Cash and cash equivalents $ 9,511 $ 13,590
Short-term bank deposits 114 112
Marketable securities 8,964 8,251
Other accounts receivable and prepaid
expenses 405 297
Total current assets 18,994 22,250
LONG-TERM INVESTMENTS 2,089 2,391
SEVERANCE PAY FUND 171 144
PROPERTY AND EQUIPMENT, NET 1,340 1,253
Total assets $ 22,594 $ 26,038
LIABILITIES AND SHAREHOLDERS' EQUITY
Short-term bank loan, current maturities
of capital lease and of long-term loan $ 168 $ 247
Trade payables 797 516
Other accounts payable and accruals 1,099 1,102
Total current liabilities 2,064 1,865
Long-term bank loan and capital lease 50 16
Deferred revenue 228 228
Accrued severance pay 366 324
Total Long-term Liabilities 644 568
COMMITMENTS AND CONTINGENT LIABILITIES
Share capital: 27 27
Additional paid-in capital 59,201 58,984
Other comprehensive income 28 86
Deficit accumulated during the
development stage (39,370) (35,492)
Total shareholders' equity 19,886 23,605
Total liabilities and shareholders'
equity $ 22,594 $ 26,038
ROSETTA GENOMICS LTD. AND ITS SUBSIDIARY
(A development stage company)
CONSOLIDATED STATEMENTS OF OPERATIONS
U.S. dollars in thousands (except share and per share data)
Year ended December 31, ended March 31,
2007 2006 2008 2007
|SOURCE Rosetta Genomics Ltd|
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