Mar 31 2010
Rosetta Genomics, Ltd. (NASDAQ:ROSG), a leading developer of
microRNA-based molecular diagnostics, today reported that on March 26,
2010 the Company filed its Form 20-F with the U.S. Securities and
Exchange Committee, which contains financial results for the three and
12 months ended December 31, 2009. Highlights of the fourth quarter of
2009 and subsequent weeks include:
“Reconciliation of GAAP to Non-GAAP Consolidated Statement of
Operation.”
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The Company strengthened its balance sheet with the successful
completion of a registered direct offering in January 2010 of
2,530,000 ordinary shares and warrants to purchase 1,265,000 ordinary
shares at an exercise price of $2.50 per share, with net proceeds to
the Company of approximately $4.65 million.
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The Company's patent estate was fortified with the issuance of four
additional U.S. patents covering composition of matter of human
microRNAs, and the allowance of claims of two additional U.S. patent
applications.
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Data were published by Johns Hopkins University researchers in "Clinical
Cancer Research" demonstrating miRview™ squamous is a highly
reliable tool for subclassifying non-small cell lung cancer (NSCLC)
with 100% sensitivity and specificity. The study showed miRview™
squamous exceeds current "gold standard" methods and is able to
accurately subclassify NSCLC regardless of the tumor grade. miRview™
squamous also correctly classified 95% of fine-needle aspirate
specimens originally diagnosed as poorly differentiated NSCLC into
squamous and non-squamous cell carcinoma.
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Data were published from a joint study by NYU Langone Medical Center
and Rosetta Genomics in "Cancer Research" that showed a single
microRNA biomarker could be used for the prognosis of mesothelioma
patients. The data demonstrated the potential of miR-29c* to act as an
independent prognostic factor for time to progression as well as
survival after surgery. It also showed the ability to forecast
outcomes for malignant pleural mesothelioma, which may enable
clinicians to provide aggressive therapy to the most appropriate
patients.
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The Company expanded and enhanced its board of directors with the
additions of Kenneth A. Berlin, the Company's President and CEO, and
David Sidransky, M.D., a director of the Head and Neck Cancer Research
Division at Johns Hopkins University School of Medicine and a
Professor of Oncology, Otolaryngology, Cellular & Molecular Medicine,
Urology, Genetics and Pathology at Johns Hopkins University and
Hospital.
Management Commentary
"During the fourth quarter of 2009, Prometheus Laboratories, which has
exclusive rights to our first three miRview assays in the U.S, began the
initial launch for these three microRNA-based diagnostic tests under the
ProOnc™ brand. These efforts largely consisted of providing and
processing samples, creating and developing the branding, and hiring and
training the first phase of sales representatives. We expect these
efforts will translate into increasing sales of these three tests over
time as Prometheus builds brand awareness and continues to expand its
sales force in the U.S.," said Mr. Berlin.
"We remain enthusiastic about our product pipeline and are currently
advancing five tests through the development process. Our
second-generation miRview™ mets test, with more than 40 tumors in its
expanded tumor panel, is being developed to significantly increase our
ability to identify the primary origin of metastases. We are on track to
complete validation and launch this test in the second half of this year.
"Rosetta Genomics and our collaborators continue to generate and publish
data that further demonstrate the potential microRNAs hold as effective
biomarkers, validate the strength of our microRNA platform technologies,
and demonstrate our ability to harness the power of microRNA to advance
the standard of care in diagnosing and treating cancer and other disease
areas. Importantly, we also continue to build our microRNA patent
estate, which we believe is the broadest and most significant of any
company working in this area. Our broad and deep intellectual property
estate further enhances our leadership position in the area of
microRNA-based diagnostics," he added.
"In order to tailor therapies in a more precise manner—the essence of
personalized medicine—there is a clear need to determine at the
molecular level what makes one group of patients who respond to a
specific therapy different from those who do not. The search for
response biomarkers that can separate responders from non-responders
continues in earnest as these biomarkers have the potential to increase
the efficiency and effectiveness of drug development. We expect to
leverage our microRNA platform technologies to expand into additional
areas such as response biomarkers and companion diagnostics, where our
proven technologies can be deployed to enhance patient selection for
clinical trials and to determine which patients stand to benefit from
therapeutics. In addition to building shareholder value, we believe that
the introduction of our products and technologies into this arena has
the potential to significantly enhance patient care and outcomes,"
concluded Mr. Berlin.
Fourth Quarter Results
The Company recorded $119,000 and $0 as revenues in the fourth quarters
of 2009 and 2008, respectively.
Research and development expenses were $1.7 million for the fourth
quarter of 2009, compared with $2.1 million for the fourth quarter of
2008. R&D expenses decreased due to lower costs related to salaries as a
result of a decrease in headcount, and in 2008 research and development
efforts were more focused on the three new products.
Marketing and business development expenses were $1.3 million for the
fourth quarter of 2009, compared with $713,000 for the fourth quarter of
2008. The increase was due primarily to an increase in expenses related
to salaries.
General and administrative expenses were $1.2 million in the fourth
quarter of 2009, compared with $773,000 in the fourth quarter of 2008.
This increase resulted primarily from costs associated with expenses
related to salaries, an increase in legal fees, and expenses related to
the filing of a registration statement.
The operating loss for the fourth quarter of 2009 was $4.1 million,
including $615,000 of non-cash stock based compensation expense, which
includes $133,000 in stock based compensation of shares granted. This
compares with an operating loss of $3.6 million, including $285,000 of
non-cash stock based compensation expense, for the corresponding quarter
of 2008.
The Company's net loss from continuing operations in the fourth quarter
of 2009 was $4.1 million or $0.29 per ordinary share, compared with a
net profit from continuing operations of $2.0 million or $0.17 per
ordinary share in the same period of 2008, during which the Company
received $7.4 million from Credit Suisse for the repurchase of all
remaining Auction Rate Securities the Company purchased in 2007, as part
of a settlement agreement Credit Suisse reached with the Attorney
General of the State of New York and the North American Securities
Administrators Association Task Force.
On a non-GAAP basis, excluding stock-compensation expense and impairment
of investment on marketable securities, the net loss for the 2009 fourth
quarter was $3.6 million or $0.25 per ordinary share. This compares with
the comparable non-GAAP figures for the 2008 fourth quarter of a net
loss of $4.3 million or $0.35 per ordinary share.
On a GAAP basis, the net loss for the 2009 fourth quarter was $4.0
million, or $0.28 per ordinary share. This compares with the GAAP net
profit for the 2008 fourth quarter of $1.1 million or $0.09 per ordinary
share, which includes the receipt of $7.4 million from Credit Suisse for
the repurchase of the Auction Rate Securities.
Details reconciling non-GAAP amounts with GAAP amounts are provided in
the table below.
Full Year 2009 Results
For the year ended December 31, 2009 the Company reported revenues of
$150,000, compared with no revenues for the year ended December 31,
2008. The increase is largely due to royalty revenue from a previous
agreement with Ambion (now Applied Biosystems) and service revenue
associated with the Company's license agreement with Prometheus
Laboratories.
On a non-GAAP basis, excluding stock-compensation expense and impairment
of investment on marketable securities, the net loss for the year ended
December 31, 2009 was $15.2 million or $1.12 per ordinary share. This
compares with the comparable non-GAAP figures for the year ended
December 31, 2008 of a net loss of $14.1 million or $1.17 per ordinary
share.
On a GAAP basis, the net loss for the year ended December 31, 2009 was
$16.5 million or $1.22 per ordinary share. This compares with the GAAP
net loss for the year ended December 31, 2008 of $9.5 million or $0.79
per ordinary share, which includes the receipt of $7.4 million from
Credit Suisse for the repurchase of the Auction Rate Securities.
As of December 31, 2009, the Company had $10.3 million in cash, cash
equivalents, short-term bank deposits and marketable securities. This
does not include the $4.65 million in net proceeds from the January 2010
registered direct offering.
Details reconciling non-GAAP amounts with GAAP amounts are provided in
the table below.
2010 Financial Guidance
Rosetta Genomics affirms its 2010 financial forecast for revenues from
the processing of tests to range from $2 million to $4 million based on
processing between 1,200 and 2,400 samples, and for cash burn from
operations to be approximately $900,000 per month; however, this may
change significantly based on a number of factors, including the
Company's current assumptions of revenues and royalties from sales of
its three marketed products, as well as the availability of other
potential sources of cash.
Source Rosetta Genomics