deCODE genetics, Inc. Announces Third Quarter 2007 Financial Results
REYKJAVIK, Iceland, Nov. 5 /PRNewswire-FirstCall/ -- deCODE genetics today announced its consolidated financial results for the quarter ended September 30, 2007. A conference call to discuss the quarter's results and recent operating highlights will be webcast live tomorrow, Tuesday, November 6, at 8:00am Eastern Standard Time/1pm GMT (details below).
Net loss for the quarter ending September 30, 2007 was $24.2 million, compared to $23.6 million for the third quarter 2006. Net loss for the first nine months of 2007 was $63.1 million, compared to $62.2 million for the first nine months of last year. Basic and diluted net loss per share was $0.40 for the third quarter 2007, unchanged from the same period last year. For the first nine months of 2007, basic and diluted net loss per share was $1.03, compared to $1.11 for the first nine months of last year. At the close of the third quarter 2007, the company had approximately 61.7 million shares outstanding.
Revenue for the third quarter this year was $10.9 million, compared to $8.6 million for the same period a year ago. For the first nine months of 2007, revenue was $27.1 million, compared to $29.1 million for the same period last year. As of September 30, 2007, the company had $15.2 million in deferred revenue that will be recognized over future reporting periods. The largest single factor in the period-on-period increase in revenue for the third quarter, and in the company's deferred revenue, is the growth of the company's genotyping business.
Research and development expense was $14.1 million for the third quarter of this year, compared to $14.2 million for the same period last year. For the first nine months of 2007, R&D expense was $41.3 million, compared to $42.9 million for the first nine months of 2006. Our research and development expense this year reflects the advancement of our drug development programs, the launch of our first three DNA-based tests for gauging individual risk of common diseases, and the acceleration of our gene and target discovery work in several major disease areas.
Selling, general and administrative expense for the third quarter of 2007 was $7.1 million, compared to $6.9 million for the 2006 period. For the first nine months of the year, SG&A expense was $19.4 million in 2007 and $16.6 million in 2006. The increases in SG&A expense year-on-year reflect the build- up of our diagnostics business as well as increased salary and stock-based compensation expense in the 2007 periods.
At September 30, 2007, the company had $118.6 million in cash, cash equivalents and investments, including restricted cash equivalents, compared to $152.0 million at December 31, 2006.
"The success of our gene discovery work is giving us a steady stream of novel targets for both diagnostics and therapeutics in major therapeutic areas. With the launch of deCODE AF(TM) and deCODE MI(TM), we have continued in the past quarter to expand our portfolio of DNA-based risk predisposition tests, offering new tools for focusing and improving disease prevention. More such products, including tests in glaucoma and other conditions, as well as a service through which individuals can begin to learn about their own genome, are on the way in the coming months," said Kari Stefansson, CEO of deCODE.
"In our drug development program targeting the leukotriene pathway for the prevention of heart attack, DG051 is now in a phase IIa trial that will aid us in dose selection for a larger Phase II study scheduled for early next year, and we expect to complete our bioequivalence analysis for our lead reformulation for DG031 before the end of 2007. With DG041, our Phase II anti- platelet compound, we have recently completed two studies confirming the lack of undesirable drug-drug interactions, as well as a pharmacology study of its effects in the presence and absence of aspirin. The results of that study provide further evidence that DG041 inhibits platelet activation and aggregation through a crucial pathway that is not targeted by existing medications. In order to manage risk and expand our therapeutic pipeline, we are actively investigating partnership opportunities for these and earlier stage programs. Our financial results this year demonstrate our ability to create valuable assets through product development while leveraging our capabilities to generate near-term revenue streams," Dr. Stefansson concluded.
deCODE genetics is a global leader in applying human genetics to develop drugs and diagnostics for common diseases. Our population approach has enabled us to discover and target key biological pathways involved in conditions ranging from heart attack to cancer. We are turning these discoveries into new medicine to better treat and prevent many of the biggest challenges to public health. deCODE is delivering on the promise of the new genetics.(SM) Visit us on the web at http://www.decode.com, and on our diagnostics site at http://www.decodediagnostics.com.
Conference Call Information
A conference call, during which deCODE President and CEO Kari Stefansson and CFO Lance Thibault will discuss third quarter financial results and recent operating highlights, will be webcast tomorrow, Tuesday, November 6, at 8:00am Eastern Standard Time/1pm GMT. The webcast can be accessed via the Investors section of deCODE's website, http://www.decode.com, or through http://www.earnings.com. A replay of the call will be available on these websites for at least one week following the call. A digitized telephone replay of the call can be accessed for the week following the call by dialing 1 800 475 6701 from the US, or +1 320 365 3844 from outside the US. The access code is 892864.
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* Cash and investments include cash equivalents and restricted cash equivalents
Any statements contained in this presentation that relate to future plans, events or performance are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results, and the timing of events, to differ materially from those described in the forward-looking statements. These risks and uncertainties include, among others, those relating to technology and product development, integration of acquired businesses, market acceptance, government regulation and regulatory approval processes, intellectual property rights and litigation, dependence on collaborative relationships, ability to obtain financing, competitive products, industry trends and other risks identified in deCODE's filings with the Securities and Exchange Commission deCODE undertakes no obligation to update or alter these forward-looking statements as a result of new information, future events or otherwise.
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