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Echo Therapeutics Announces Third Quarter 2013 Financial Results
Date:11/7/2013

PHILADELPHIA, Nov. 7, 2013 /PRNewswire/ -- Echo Therapeutics, Inc. (Nasdaq: ECTE), a medical device company developing its Symphony® CGM System as a non-invasive, wireless continuous glucose monitoring system, today announced its financial results for the quarter ended September 30, 2013. Echo's Quarterly Report on Form 10-Q, when filed with the SEC, will be available by visiting the Investors section of Echo's website at www.echotx.com.

Recent Corporate Highlights

  • Echo continued to enroll patients in its multi-center clinical trial of its Symphony CGM System in surgical patients in hospital critical care units.  The Company expects to complete the study in the fourth quarter, and will subsequently submit the CE Mark Technical File for marketing approval in Europe.
  • Echo received comments from the U.S. Food and Drug Administration (FDA) Center for Devices and Radiological Health on the pre-submission package that was filed in June 2013. Subsequent to the end of the third quarter, the Company met with the FDA to obtain guidance regarding the regulatory pathway for Symphony. Based on the FDA's comments and Echo's preliminary statistical analysis, the Company believes the FDA Pivotal Trial will have a sample size of 250-350 patients. Echo also plans to submit an Investigational Device Exemption, or IDE, for a Clamping Study to manipulate glucose levels on healthy volunteers to provide the Company with additional data to support its eventual Premarket Approval, or PMA, submission.
  • Robert F. Doman was appointed Echo's Executive Chairman and Interim Chief Executive Officer, effective August 26, 2013.
  • At the end of the third quarter, Echo implemented a number of substantial cost reduction initiatives aimed at reducing operating costs, particularly marketing and manufacturing expenditures and corporate general and administrative costs.  As a result of these initiatives, the fourth quarter burn rate is expected to decrease by approximately 35-40% from the quarterly burn rate experienced during the first three quarters of 2013.
  • "We continue to make significant progress toward completion of the CE Mark regulatory trial and look forward to sharing top-line data in the coming weeks.  We remain confident that the clinical trial will deliver strong results and we continue to actively prepare for the CE Mark Technical File submission," commented Robert F. Doman, Executive Chairman and Interim CEO of Echo Therapeutics.  "As we look toward 2014, we remain focused on obtaining European clearance of Symphony, as well as initiating our pivotal study to support PMA submission in the U.S.  Furthermore, we continue to explore the potential for strategic partnerships and will disclose details if or when such a transaction is consummated."

    Third Quarter 2013 Financial ResultsEcho's net loss for the third quarter of 2013 was $5.2 million, or $0.49 per share, compared to $4.3 million, or $1.07 per share, for the third quarter of 2012. The operating loss for the third quarter of 2013 was $4.9 million compared to $3.6 million for the third quarter of 2012.  Research and development expenses were $2.8 million for the third quarter of 2013 compared to $2.1 million for the third quarter of 2012. The increase in research and development expenses was primarily related to increased development, regulatory and clinical expenses, as well as manufacturing preparation costs. Selling, general and administrative expenses were $2.2 million for the third quarter of 2013 compared to $1.5 million for the third quarter of 2012. Selling, general and administrative expenses increased primarily due to prelaunch marketing and manufacturing activities. Echo reported a cash balance of approximately $6.1 million as of September 30, 2013.

    Conference CallManagement will host a conference call today starting at 9:00 AM EST.  To listen in and/or participate in the call, please dial (877) 300-8521 and reference Echo Therapeutics' Third Quarter Conference Call.  The archived audiocast will be available for fourteen days following the call by visiting the Events section of Echo's website at www.echotx.com.

    About Echo TherapeuticsEcho Therapeutics is developing the Symphony CGM System as a non-invasive, wireless, continuous glucose monitoring system for use initially in the hospital critical care setting. Significant opportunity also exists for Symphony to be used in the hospital beyond the critical care setting. The Prelude® SkinPrep System, a component of the Symphony CGM System, allows for enhanced skin permeation that will enable extraction of analytes, such as glucose, and enhanced delivery of topical pharmaceuticals.

    Cautionary Statement Regarding Forward Looking StatementsThe statements in this press release that are not historical facts, including those regarding the announcement of clinical trial data, anticipated clinical trials and a reduction in Echo's fourth quarter burn rate, may constitute forward-looking statements that are based on current expectations and are subject to risks and uncertainties that could cause actual future results to differ materially from those expressed or implied by such statements. Those risks and uncertainties include, but are not limited to, risks related to regulatory approvals and the success of Echo's ongoing studies, including the safety and efficacy of Echo's Symphony CGM System, the failure of future development and preliminary marketing efforts related to Echo's Symphony CGM System, Echo's ability to secure additional commercial partnering arrangements, risks and uncertainties relating to Echo's and its partners' ability to develop, market and sell the Symphony CGM System, the availability of substantial additional equity or debt capital to support its research, development and product commercialization activities, and the success of its research, development, regulatory approval, marketing and distribution plans and strategies, including those plans and strategies related to its Symphony CGM System. These and other risks and uncertainties are identified and described in more detail in Echo's filings with the Securities and Exchange Commission, including, without limitation, its Annual Report on Form 10-K for the year ended December 31, 2012, its Quarterly Reports on Form 10-Q, and its Current Reports on Form 8-K. Echo undertakes no obligation to publicly update or revise any forward-looking statements.

    For More Information:Christine H. Olimpio
    Director, Investor Relations and Corporate Communications
    (215) 717-4104
    colimpio@echotx.com
    or Seth Lewis
    Senior Vice President, Trout Group, LLC
    (646) 378-2952Connect With Us:

  • Visit our website at www.echotx.com
  • Follow us on Twitter at www.twitter.com/echotx
  • Join us on Facebook at www.facebook.com/echotx
  •  Echo Therapeutics, Inc

    Condensed Consolidated Balance Sheets

    (Unaudited)September 30,

    2013December 31,

    2012ASSETSCurrent Assets:  Cash and cash equivalents

    $
    ,068,469$
    3,747,210  Deferred financing costs, current portion

    968,004968,004  Prepaid expenses, cash restricted pursuant to letters of credit and other current assets

    784,573483,089
    Total current assets

    7,821,0465,198,303Property and equipment (including assets under capitalized leases), net of accumulated depreciation
      and amortization

    1,586,8981,638,395Other Assets:  Intangible assets, net of accumulated amortization

    9,625,0009,625,000  Deferred financing costs, net of current portion

    2,823,3253,549,328  Other assets

    12,06610,566
    Total other assets

    12,460,39113,184,894
    Total assets

    $
    21,868,335$
    20,021,592LIABILITIES AND STOCKHOLDERS' EQUITYCurrent Liabilities:
    Accounts payable

    $
    ,551,092$
    2,319,219  Deferred revenue from licensing arrangements, current portion

    90,22890,228  Capital lease obligation, current portion

    2,0172,527  Derivative warrant liability

    979,1555,585,141  Accrued expenses and other current liabilities

    1,595,9201,581,448
    Total current liabilities

    4,218,4129,578,563Deferred revenue, note payable and capital lease obligation, net of current portion

    22,557212,423
    Total liabilities

    4,240,9699,790,986Commitments and contingenciesStockholders' Equity:  Convertible preferred stock, Series C & D

    30,16030,160  Common stock

    107,00344,374  Additional paid-in capital

    126,958,986104,058,087  Accumulated deficit

    (109,468,783)(93,902,015)
    Total stockholders' equity

    17,627,36610,230,606
    Total liabilities and stockholders' equity

    $
    21,868,335$
    20,021,592 

     

    Condensed Consolidated Statements of Operations

    (Unaudited)

     Three Months Ended

    September 30,Nine Months Ended

    September 30,2013201220132012Licensing revenue

    $
    22,557$
    30,927$
    7,671$
    92,781
    Total revenues

    22,55730,92767,67192,781Operating Expenses:  Research and development

    2,756,0052,139,4659,994,8775,731,417  Selling, general and administrative

    2,192,4121,508,0696,590,2064,702,325
    Total operating expenses

    4,948,4173,647,53416,585,08310,433,742
    Loss from operations

    (4,925,860)(3,616,607)(16,517,412)(10,340,961)Other Income (Expense):  Interest expense, net

    (241,185)(88,488)(3,655,341)(84,257)  Debt financing costs

    -(160,000)-(160,000)  Loss on disposals of assets

    ---(21,272)  Gain (loss) on revaluation of derivative warrant liability

    (70,000)(400,000)4,605,986201,281
    Other income (expense), net

    (311,185)(648,488)950,645(64,248)
    Net loss

    $
    (5,237,045)$
    (4,265,095)$   (15,566,767)$   (10,405,209)Net loss per common share, basic and diluted

    $
    (0.49)$
    (1.07)$
    (2.06)$
    (2.65)Basic and diluted weighted average common shares
    outstanding

    10,688,7813,985,8887,571,7333,925,637(Reflects 1-for-10 reverse stock split, effective June 7, 2013)
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    SOURCE Echo Therapeutics, Inc.
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