DiagnoCure announces fourth quarter 2014 and year-end results

QUEBEC CITY, Jan. 23, 2015 /PRNewswire/ - DiagnoCure, Inc. (TSX: CUR) (OTCQX: DGCRF) (the "Corporation") today reported financial and operational results for the fourth quarter 2014 and fiscal year ended October 31, 2014. The Corporation announced a net loss of $461,710 or $0.01 per share for the fourth quarter ended October 31, 2014, compared to $1,334,099 or $0.03 per share for the same period in 2013 and a net loss of $2,032,151 or $0.05 per share for fiscal year 2014 compared to $3,566,942 or $0.08 per share for the same period in 2013. At the end of the quarter, cash and short-term investments stood at $2,227,326 compared to $4,190,296 at the end of fiscal year 2013.

PCA3

DiagnoCure's biomarkers continue to draw attention in the clinical community. In December 2014, Dr John T. Wei and colleagues published the results of the National Cancer Institute (NCI) Early Detection Research Network (EDRN) validation of PCA3 trial in the Journal of Clinical Oncology. In the study, Wei and colleagues evaluated 859 men scheduled for diagnostic prostate biopsy between 2009 and 2011. The researchers evaluated the positive predictive value of the PCA3 urine test at initial biopsy and the negative predictive value at repeat biopsy. When they looked at men with a PCA3 score of less than 20, 46% would have avoided a biopsy while only 3% would have had an undiagnosed high-grade cancer. These new results further support the potential role of PCA3 in reducing the burden of unnecessary biopsies resulting from PSA screening alone.  Results such as these further galvanize DiagnoCure's unrelenting efforts to ensure that its worldwide exclusive licensee fully exploits the commercial potential of this product.

Prostate cancer multimarker test

Positive results of the 500-patient clinical trial completed during fiscal year 2014 on DiagnoCure's new multi-marker prostate cancer test ("PCP") will be featured in presentations at two major urology events over the next few months. After a thorough review of market opportunities, DiagnoCure believes it is making significant steps in establishing partnerships for commercialization of this new diagnostic test.

GCC

The body of compelling clinical data of GCC continues to grow with the results of a systematic pooled data analysis published online on December 23, 2014 in the Clinical Colorectal Cancer journal. Untreated stage IIA colon cancer patients considered at high risk based on their GCC lymph node ratio (LNR) status were demonstrated to have significantly inferior outcomes compared with those with low GCC LNR values. This study thus confirmed that quantitative assessment of GCC mRNA levels in lymph nodes can be used to detect the presence of occult metastases, allowing prediction of disease recurrence, which could not be achieved with traditional methods. Beside the recent agreement signed with Shuwen Biotech, the Corporation has maintained discussions with potential commercial partners aimed at making this test available to patients around the world.

Results for the Fiscal Year Ended October 31, 2014

Total revenues for fiscal 2014 were $553,140 compared with $671,228 for 2013. This decrease of $118,088 or 18% is mainly attributable to PCA3 royalties reflecting a decrease in U.S. royalty revenues.

Operating expenses decreased by $1,652,879 to $2,585,291 for 2014 from $4,238,170 for 2013. This decrease is mainly attributable to reduction in professional fees and amortization and impairment of intangible assets. Total operating expenses decreased primarily as a result of the following:

• Research and development expenses, net of investment tax credits, decreased by $1,064,123 to $1,083,124 for 2014 from $2,147,247 for 2013. This decrease in research and development expenses is mostly attributable to the amortization charge of the GCC intangible asset following the review of its useful life and to the amortization and impairment of the Shc intangible asset, since the Corporation recognized a full impairment charge in fiscal year 2013.
• General and administrative expenses decreased by $563,448, to $1,346,011 for 2014 from $1,909,459 in fiscal 2013. This decrease is attributable to reduction in professional fees and stock-based compensation expenses.

Based on the above, for fiscal 2014, DiagnoCure recorded a net loss and comprehensive loss of $2,032,151 or $0.05 per share, compared with $3,566,942 or $0.08 per share for fiscal 2013. These results reflect activities undertaken during fiscal 2014 on PCA3, Previstage GCC, research and development and business development. As at October 31, 2014, cash and short-term investments stood at $2,227,326 down from $4,190,296 as at October 31, 2013. This decrease of $1,962,970 is due to the use of liquidities to finance the operating activities of fiscal 2014. With the operating expenses reduction announced on October 30, 2014, Management estimates the cash burn of fiscal 2015 to be $1.2M and is satisfied that it has adequate cash resources to finance the Corporation's activities, and will continue to monitor its cash levels.

Results of the Fourth Quarter 2014

Total revenues for the fourth quarter of 2014 were $122,254 compared with $149,465 for the same period of 2013. This decrease of $27,211 or 18% is mostly attributable to PCA3 royalties, reflecting a decrease in royalty revenues from Europe.

Operating expenses decreased by $899,600 to $583,964 for the third quarter of 2014 from $1,483,564 for the same period of 2013. This decrease is mainly attributable to reduction in professional fees, amortization and impairment of intangible assets. Total operating expenses decreased primarily as a result of the following:

• Research and development expenses, net of investment tax credits, decreased by $683,867 to $275,110 for the fourth quarter of 2014 from $958,977 for the same period of 2013. This decrease in research and development expenses is attributable to the amortization charge of the GCC intangible asset following the review of its useful life and to the amortization and impairment charges of the Shc intangible asset, since the Corporation recognized a full impairment charge in the last quarter of fiscal 2013.
• General and administrative expenses decreased by $181,168 to $287,204 for the fourth quarter of 2014 from $468,372 for the same period of 2013. This decrease is attributable to reduction in professional fees and stock-based compensation expenses.

 

Financial Data
For the periods of	Three months ended October 31		Year ended October 31
	2014	2013	2014	2013
	$	$	$	$
Revenue under license and royalty agreements	122,254	149,465	553,140	671,228
Total revenues	122,254	149,465	553,140	671,228
Operating expenses (before stock-based compensation, depreciation, amortization and impairment)	489,682	787,036	2,186,400	2,800,532
Net loss (before stock-based compensation, depreciation, amortization and impairment)	(367,428)	(637,571)	(1,633,260)	(2,129,304)
Stock-based compensation	10,810	40,411	62,463	128,116
Depreciation of property, plant and equipment	13,896	15,403	57,529	69,908
Amortization of intangible asset	69,576	200,021	278,899	798,921
Impairment of intangible asset	―	440,693	―	440,693
Net loss	(461,710)	(1,334,099)	(2,032,151)	(3,566,942)
Basic and diluted net loss per share	(0.01)	(0.03)	(0.05)	(0.08)
Weighted average number of common shares outstanding	43,040,471	43,040,471	43,040,471	43,040,471

 

Consolidated Balance Sheets
	As of October 31
	2014	2013
Cash and temporary investments	2,227,326	4,190,296
Total assets	5,532,382	7,849,267
Shareholders' equity	5,039,573	7,009,261
Number of common Shares outstanding	43,040,471	43,040,471

 

About DiagnoCure

DiagnoCure (TSX: CUR; OTCQX: DGCRF) is a life sciences corporation that develops and provides molecular and genomic tests to support effective clinical decisions enabling personalized medicine in oncology. Previstage^â GCC and the Corporation new multimarker prostate cancer test are currently available for licensing. The Corporation has granted a worldwide exclusive license on PCA3 for the development and commercialization of a prostate cancer test which is now commercialized in Europe under CE mark and is approved for commercialization in Canada and the United States. For more information, please visit www.diagnocure.com.

Forward-looking statements

This release may contain forward-looking statements that involve known and unknown risks, uncertainties and assumptions that may cause actual results to differ materially from those expected. Forward-looking statements can be identified by the use of the conditional or forward-looking terminology such as "anticipates", "assumes", "believes", "estimates", "expects", "intend", "may", "plans", "projects", "should", "will", or the negative thereof or other variations thereon. Forward-looking statements also include any other statements that do not refer to historical facts. All such forward-looking statements are made pursuant to the "safe-harbour" provisions of applicable Canadian securities laws. 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. Forward-looking statements are presented for the purpose of assisting investors and others in understanding certain key elements of the Corporation's current objectives, strategic priorities, expectations and plans, and in obtaining a better understanding of the Corporation's business and anticipated operating environment. Readers are cautioned that such information may not be appropriate for other purposes and that they should not place undue reliance on these forward-looking statements. For instance, any forward-looking statements regarding the outcome of research and development projects, clinical studies and future revenues, including those related to PROGENSA® PCA3, are based on management expectations and such outcome may vary materially depending on global political and economic conditions, dependence on collaboration partners, uncertainty of healthcare reimbursement, and marketing and distribution challenges. 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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