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Diadexus, Inc. Reports Second Quarter 2015 Financial Results

20:00 EDT 12 Aug 2015 | Marketwired

SOUTH SAN FRANCISCO, CA -- (Marketwired) -- 08/13/15 -- Diadexus, Inc. (OTCQB: DDXS), a diagnostics company developing and commercializing products that aid in the prediction of cardiac disease risk, today announced financial results for the six months and quarter ended June 30, 2015, and provided an update on the business.

"During the second quarter, we achieved several key milestones and corporate objectives that establish a path towards accelerated revenue growth," said Lori Rafield, Ph.D., chairman and chief executive officer for Diadexus. "The recent appointment of Hodi Hammond, our new Vice President of Sales, brings to Diadexus another highly experienced member of the management team. His prior experience and background will be invaluable as we work to evolve our business model to providing solutions for unfulfilled physician needs. Regarding ProADM, our heart failure diagnostic biomarker, we remain on track to file a regulatory submission in early 2016."

Dr. Rafield continued: "On the corporate front, we successfully completed a 1-for-15 reverse stock split, which we believe is a critical step toward a NASDAQ uplisting, and is part of a larger strategic initiative to increase awareness and visibility for Diadexus."

Year-To-Date June 30, 2015 Financial Results

Total revenues for the six months ended June 30, 2015 were $10.1 million, compared to $13.1 million for the six months ended June 30, 2014. This decrease is primarily attributable to lower PLAC® ELISA product sales and a decrease in service revenues related to a GSK agreement which completed during the fourth quarter of 2014.

Total product sales for the six months ended June 30, 2015 were $10.0 million, compared to $11.6 million for the six months ended June 30, 2014. This decrease is primarily attributable to lower PLAC® ELISA sales to our largest customer, Health Diagnostics Laboratory (HDL), due to its filing for bankruptcy in June 2015. Partially offsetting the HDL decrease is increased PLAC® ELISA sales to regional and national labs. Subsequent to its bankruptcy filing, HDL continued to place orders with the Company, on a cash-in-advance basis.

Total operating costs and expenses for the six months ended June 30, 2015 were $13.5 million, compared to $17.2 million for the six months ended June 30, 2014. This decrease is primarily attributable to lower research and development (R&D) expenses related to the B.R.A.H.M.S. GmbH license agreement for the Company's three heart failure biomarkers. The decrease was also the result of reduced personnel expenses during the first half of 2015, following the restructuring which was implemented during the fourth quarter of 2014. These decreases were partially offset by a $0.9 million provision for doubtful accounts related to HDL's bankruptcy.

The Company's net loss for the six months ended June 30, 2015 was $4.3 million, or $1.13 per share, compared to a net loss of $4.5 million, or $1.24 per share, for the six months ended June 30, 2014.

Cash and cash equivalents at June 30, 2015 were $12.1 million, compared to $14.9 million at December 31, 2014.

Second Quarter 2015 Financial Results

Total revenues for the second quarter of 2015 were $4.6 million, compared to $7.7 million reported in the second quarter of 2014. This decrease is primarily attributable to lower PLAC® ELISA product sales and a decrease in service revenues related to a GSK agreement which completed during the fourth quarter of 2014.

Total product revenues for the second quarter of 2015 were $4.5 million, compared to $6.6 million for the second quarter of 2014. This decrease is primarily attributable to lower PLAC® ELISA sales to HDL, partially offset by increased PLAC® ELISA sales to regional and national labs.

Total operating costs and expenses for the second quarter of 2015 were $7.5 million, compared to $7.9 million for the second quarter of 2014. This decrease is primarily the result of reduced personnel expenses during the second quarter of 2015, following the restructuring which was implemented during the fourth quarter of 2014. This decrease was partially offset by research and development (R&D) expenses related to the B.R.A.H.M.S. GmbH license agreement for the Company's three heart failure biomarkers and a $0.9 million provision for doubtful accounts related to HDL's bankruptcy.

The Company's net loss for the second quarter 2015 was $3.3 million, or $0.87 per share, compared to a net loss of $0.4 million, or $0.12 per share, in the second quarter of 2014.

Financial Guidance

Due to the HDL bankruptcy, and the accompanying uncertainty around their ongoing business operations, Diadexus is rescinding its previously stated revenue guidance for 2015. The Company will not be providing an outlook for 2015 at this time.

Recent Developments and Outlook

PLAC
® Business

Heart Failure Franchise

Webcast

Diadexus will host a conference call and webcast today, August 13, 2015 at 4:30 p.m. ET (1:30 p.m. PT) to discuss the second quarter 2015 financial results and provide a business update. To access the webcast, visit the Company's website at http://investors.diadexus.com/events.cfm. To access the conference call, dial 1 (855) 666-6874 for domestic callers and (262) 912-6259 for international callers. The conference ID number for both is 93519113. A replay of the webcast will be available shortly following the live webcast for a period of four weeks.

About Diadexus, Inc.

Diadexus, based in South San Francisco, California, is a diagnostics company developing and commercializing products that aid in the prediction of cardiac disease risk, providing healthcare providers with actionable information for managing patients. The Company pioneered the testing of Lp-PLA2 (lipoprotein-associated phospholipase A2), a marker of vascular-specific inflammation that provides new information, over and above traditional risk factors measured in a lipid panel, and has over a decade of peer-reviewed literature validating its utility. Diadexus' products, The PLAC® Test ELISA Kit, first cleared by the FDA in 2003, and The PLAC® Test for Lp-PLA2 Activity, cleared in December 2014, are the only two FDA-cleared tests to measure Lp-PLA2.

The Company also has a pipeline of biomarkers for heart failure, proADM, proET-1 and proANP, with each providing distinct, additive information for healthcare providers over currently available markers. Diadexus also provides services to pharmaceutical partners to address the need to incorporate biomarkers in clinical development. For more information, please visit the Company's website at www.diadexus.com.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements related to our revenue growth and guidance, potential NASDAQ uplisting, success of our business model, timing of regulatory submission and clinical and commercial need for our PLAC and ELISA tests. Forward-looking statements are based on current expectations and assumptions and entail various risks and uncertainties that could cause actual results to differ materially from those expressed in such forward-looking statements. Important factors known to us that could cause actual results to differ materially from those expressed in such forward-looking statements include the factors necessary to achieve our revenue guidance; sales of our PLAC® Test products in the marketplace; our ability to grow revenues from existing and new customers; product pricing and demand with a concentrated customer base; the continued focus of regulatory agencies and payors on costs and our laboratory customer practices; relationships with key customers; our ability to continue to build our heart failure franchise; our ability to identify and build products with additional biomarkers; third party payors' acceptance of and reimbursement for the PLAC® Tests; our ability to continue to manufacture the PLAC® Tests to meet customer demand; the potential for success of and timing of when our development efforts may be completed; the adequacy of our intellectual property rights and our ability to maintain a proprietary position for our lead product; our limited revenue and cash resources; our significant corporate expenses, including real estate lease liabilities and expenses associated with being a public company; our ability to develop proADM for regulatory submission, and our ability to successfully integrate our new management leadership. Additional factors that could cause our results to differ materially from those described in the forward-looking statements can be found in our most recent quarterly report on Form 10-Q, and other reports filed with the Securities and Exchange Commission, and available at the SEC's web site at www.sec.gov. The information set forth herein speaks only as of the date hereof, and except as required by law, we disclaim any intention and does not assume any obligation to update or revise any forward looking statement, whether as a result of new information, future events or otherwise.

Leone Patterson Chief Financial Officer (650) 246-6400 NEXT ARTICLE

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