- Company Focused on Commercialization in 2008 -
FREMONT, Calif., May 15 /PRNewswire-FirstCall/ -- Vermillion, Inc. (Nasdaq: VRML), a molecular diagnostics company, today announced financial results for the first quarter ended March 31, 2008, and provided an update on recent corporate and clinical developments.
"During the first quarter of 2008, we demonstrated significant clinical and commercialization progress in each of our diagnostic programs. These programs target significant unmet clinical needs and present attractive revenue opportunities. It is an exciting time as we explore strategic business development options that are synergistic with our Quest Diagnostics' alliance," said Gail Page, President and CEO of Vermillion.
The Company plans to finalize its clinical study examining the Ovarian Tumor Triage Test, now named OVA1(TM), and submit OVA1 to the U.S. Food and Drug Administration (FDA) in the second quarter of this year. Additionally, Vermillion is working on clinical studies and building market awareness of the PAD blood test, now named VASCLIR(TM) the PAD test. Throughout the remainder of 2008, the Company will focus on commercialization efforts.
First Quarter 2008 Financial Results
As a result of the November 13, 2006 sale of its former instrument business to Bio-Rad Laboratories, the Company does not anticipate significant revenue until its diagnostic tests are commercialized. During the first quarter of 2008, products revenue of $5,000 was generated from the sale of thrombotic thrombocytopenic purpura ("TTP") test component materials to The Ohio State University Research Foundation ("OSU").
Total operating expenses decreased in the first quarter of 2008 to $4.6 million, from $5.7 million in the same period last year. The decrease was due primarily to restructuring of personnel and reduced general and administrative expenses.
The Company's net loss for the first quarter of 2008 was $4.8 million, compared to $6.0 million for the same period in 2007. Basic and diluted net loss for the first quarter of 2008 was $0.76 per share based on 6.38 million total shares outstanding, compared to a basic and diluted net loss of $1.54 per share based on 3.92 million total shares outstanding for the same period in 2007. Earnings per share calculations are on a post reverse stock split basis.
At March 31, 2008, the Company's cash, short- and long-term investments totaled $14.3 million, compared to $20.4 million at December 31, 2007. Net cash used in operating activities in the first quarter of 2008 was $5.5 million. The semi-annual payment of interest of approximately $0.6 million on the senior convertible note is due during the first and third quarters, which results in higher net cash outflows for these quarters. Vermillion continues to diligently manage expenses and cash utilization.
Recent Highlights and Accomplishments
During the first and into the second quarter of the year, Vermillion
achieved numerous milestones in its three leading diagnostic programs and
continued to progress in its corporate development efforts.
-- PAD Diagnostic Program
* Established a clinical steering committee to provide advice on
studies to support registration of VASCLIR with the FDA and to
further potential market adoption.
* Presented data from a study providing further confirmation that the
Company's test may aid in the diagnosis of PAD. The research, which
was presented at the American College of Cardiology 57th Annual
Scientific Session, suggests that such a test may be useful in
helping determine a patient's risk for developing PAD.
* Further bolstered Vermillion's intellectual property by advancing
the Company's license agreement with Stanford University to an
exclusive level. The license from Stanford covers the development
and commercialization of a biomarker panel used to assess the risk
* Hosted a roundtable teleconference focusing on Vermillion's PAD
diagnostic program and the need for improved detection of this
life- and limb-threatening condition. The teleconference featured
keynote speaker John Cooke, M.D., Ph.D., Professor of Medicine at
Stanford University, whose research forms the basis of Vermillion's
* Conducted market-development activities, including working with the
PAD Coalition and implementing an online physician survey to gather
market-based information, helping to define the Company's
commercialization strategy and broaden future clinical use of
-- Ovarian Cancer Diagnostic Program
* Continued to make progress with the clinical study evaluating OVA1
and plan to submit to the FDA in the second quarter.
* Presented data from several studies demonstrating the benefits of
the Company's ovarian cancer diagnostic test programs at the
Society of Gynecologic Oncologists' (SGO) 39th Annual Meeting on
Women's Cancer. The data suggest that use of Vermillion's tests
could help better identify women with early-stage ovarian cancer
and improve detection.
* Received the distinguished SGO Basic Science Poster Award for its
abstract, "Prospective independent validation of a marker panel for
distinguishing benign from malignant pelvic masses."
-- Hematology Diagnostic Program
* Reported findings from an OSU clinical study that indicated that a
SELDI-TOF-based TTP diagnostic test, which already has been
commercially launched as a laboratory developed test by the
institution, also could be used to help estimate the risk of TTP
relapses during clinical remission. The data -- published in the
online edition of the British Journal of Haematology -- indicate
that use of the test may provide a novel screening strategy to
identify patients who may benefit from prophylactic treatment to
help prevent relapse of this serious blood disorder.
-- Corporate Developments
* Appointed John F. Hamilton, former vice president and chief
financial officer of Depomed, Inc., to the Vermillion Board of
Directors and to serve as chairman of the Audit Committee of the
* Received issuance of U.S. Patent No. 7,341,838 for the discovery of
novel forms of brain natriuretic peptide (BNP), which could
potentially improve upon the current standard of care in diagnosing
and treating cardiovascular disease. The discovery could ultimately
lead to the development of an improved, next-generation assay that
might provide physicians with additional, valuable information to
stratify patients at risk for cardiovascular disease.
* Renewed a long-standing collaboration with Johns Hopkins University
on the development of novel biomarkers that can be applied toward
disease detection, classification and monitoring of prevalent
cancers, including ovarian, breast and prostate. Vermillion will
have access to exclusive commercial rights to the discoveries made
through the partnership.
* Vermillion's stockholders and board of directors approved a 1 for
10 reverse stock split of the Company's common stock, which became
effective at the close of trading on March 3, 2008.
Vermillion, Inc. is dedicated to the discovery, development and commercialization of novel high-value diagnostic tests that help physicians diagnose, treat and improve outcomes for patients. Vermillion, along with its prestigious scientific collaborators, has diagnostic programs in oncology, hematology, cardiology and women's health. Vermillion is based in Fremont, California. Additional information about Vermillion can be found on the Web at http://www.vermillion.com.
Forward Looking Statements -- This news release contains
forward-looking statements that involve significant risks and
uncertainties, including statements regarding Vermillion's plans,
objectives, expectations and intentions. These forward-looking statements
are based on Vermillion's current expectations. The Private Securities
Litigation Reform Act of 1995 provides a "safe harbor" for such
forward-looking statements. In order to comply with the terms of the safe
harbor, Vermillion notes that a variety of factors could cause actual
results and experience to differ materially from the anticipated results or
other expectations expressed in such forward-looking statements. There are
no guarantees that Vermillion will succeed in its efforts to commercialize
PAD, ovarian cancer or hematology diagnostics products in 2008 or during
any other period of time. Factors that could cause actual results to
materially differ include but are not limited to: (1) uncertainty in
obtaining intellectual property protection for inventions made by
Vermillion; (2) unproven ability of Vermillion to discover, develop, and
commercialize PAD, ovarian cancer or hematology diagnostic products based
on findings from its disease association studies; (3) unproven ability of
Vermillion to discover or identify new protein biomarkers and use such
information to develop PAD, ovarian cancer or hematology diagnostic
products; (4) uncertainty as to whether Vermillion will be able to obtain
any required regulatory approval of its PAD, ovarian cancer or hematology
diagnostic products; (5) uncertainty of market acceptance of its PAD,
ovarian cancer or hematology diagnostic products, including the risk that
its products will not be competitive with products offered by other
companies, or that users will not be entitled to receive adequate
reimbursement for its products from third party payors such as private
insurance companies and government insurance plans; and (6) other factors
that might be described from time to time in Vermillion's filings with the
Securities and Exchange Commission. All information in this press release
is as of the date of the release, and Vermillion expressly disclaims any
obligation or undertaking to release publicly any updates or revisions to
any such statements to reflect any change in Vermillion's expectations or
any change in events, conditions or circumstances on which any such
statement is based, unless required by law.
- Financial statements follow -
Vermillion, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
March 31, December 31,
2008 2007 (1)
Cash and cash equivalents $8,283 $7,617
Short-term investments, at fair value - 8,875
Accounts receivable 51 19
Prepaid expenses and other current assets 1,481 1,064
Total current assets 9,815 17,575
Property, plant and equipment, net 1,630 1,938
Long-term investments, at fair value 6,043 3,902
Other assets 67 638
Total assets $17,555 $24,053
Liabilities and Stockholders' Deficit
Accounts payable $2,648 $2,975
Accrued liabilities 2,588 3,595
Current portion of convertible senior notes,
net of discount 2,482 2,471
Total current liabilities 7,718 9,041
Long-term debt owed to related party 10,000 10,000
Convertible senior notes, net of discount 16,242 16,196
Other liabilities 150 278
Total liabilities 34,110 35,515
Common stock 6 6
Additional paid-in capital 228,067 227,895
Accumulated deficit (243,988) (239,142)
Accumulated other comprehensive loss (640) (221)
Total stockholders' deficit (16,555) (11,462)
Total liabilities and stockholders' deficit $17,555 $24,053
(1) The condensed consolidated balance sheet at December 31, 2007, has
been derived from the audited consolidated financial statements at
that date included in the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 2007.
Vermillion, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In Thousands, Except Per Share Amounts)
Three Months Ended
Products $5 $-
Services 48 21
Total revenue 53 21
Cost of revenue:
Products 2 -
Services 20 15
Total cost of revenue 22 15
Gross profit 31 6
Research and development 1,875 1,990
Sales and marketing 893 477
General and administrative 1,827 3,197
Total operating expenses 4,595 5,664
Loss from operations (4,564) (5,658)
Interest and other income (expense), net (332) (383)
Loss before income taxes (4,896) (6,041)
Income tax benefit (expense) 50 (6)
Net loss $(4,846) $(6,047)
Loss per share - basic and diluted (1) $(0.76) $(1.54)
Shares used to compute basic and diluted loss
per common share (1) 6,380,188 3,923,291
(1) Adjusted for March 4, 2008, 1 for 10 reverse stock split.
|SOURCE Vermillion, Inc.|
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