BELLEVILLE, Ontario, Feb. 2 /PRNewswire-FirstCall/ -- Bioniche Life Sciences Inc. , a research-based, technology-driven Canadian biopharmaceutical company, today released second quarter results for Fiscal 2007 (for the period ended December 31, 2006).
During the second quarter, the Company announced the Canadian Food Inspection Agency (CFIA) authorization of the distribution of the Company's E. coli O157:H7 cattle vaccine to Canadian veterinarians under a Permit to Release Veterinary Biologics as specified in the Canadian Health of Animal Regulations. In order to progress to a full license in Canada, the Company must provide additional data confirming reduction in E. coli O157:H7 shedding by vaccinated animals. The Company has completed an additional efficacy study at the University of Nebraska-Lincoln and the data are currently being analyzed to determine if they meet the efficacy requirements for a full license.
Another highlight in this quarter was the announcement by the Company on November 8, 2006 of the first patient enrolled in its Phase III refractory bladder cancer clinical trial. The refractory study is the first of two studies in the Company's Phase III bladder cancer program using proprietary Mycobacterial Cell Wall-DNA Complex (MCC) -- trademarked Urocidin for the treatment of non muscle-invasive bladder cancer in patients who are refractory (unresponsive) to Bacillus Calmette-Guerin (BCG), a live, attenuated strain of Mycobacterium bovis and the current standard therapy. The Company expects to start its second Phase III clinical trial -- comparing Urocidin to BCG in treatment-naive non-muscle invasive bladder cancer patients (first line therapy) -- later this year.
Further highlights of the second quarter include (figures in Canadian dollars unless otherwise specified):
> Total revenues were $5.9 million for this period, as compared to $6.4 million in the same period in Fiscal 2006. On a year-to-date basis, revenues are $13.7 million, as compared to $12.2 million for the same period last year, a 12% increase. > The Company sold its remaining 10% ownership position in Bioniche Pharma Holdings Limited and its annual royalty payments related to future sales of Suplasyn(R), for a total of $6.7 million (US$6.0 million). A portion of these proceeds -- $2.6 million cash and $0.2 million in shares -- was used to partially repay the Company's debt with Laurus Master Funds. As a result, the Company recorded a gain of $2.1 million during the quarter. > The Company further paid down its debt with Laurus Master Funds by US$1 million on December 22nd. As well and subsequent to the quarter end, on January 12, 2007, a further US$1 million was paid down. This last conversion will be recorded during the third quarter of this fiscal year and, therefore, is not captured in the December 31, 2006 figures.
Graeme McRae, President & CEO of Bioniche Life Sciences Inc., noted: "This has been an exciting three months for our Company, with the start of our Phase III clinical program with MCC in bladder cancer and a clear pathway to full Canadian registration of our E. coli O157:H7 cattle vaccine. These two projects are priorities for the Company, and it is encouraging to see them advancing so well."
Highlights for Second Quarter Results (figures in Canadian dollars unless otherwise specified)
The Company's consolidated revenues for the second quarter of fiscal 2007 reached $5.9 million as compared to $6.4 million in the same period last year. This decrease of $0.5 million, or 7%, reflects the timing of sales for two of the Company's reproductive products.
The overall gross profit margin on product sales during the second quarter of fiscal 2007 decreased to 54% from 63% reported in the same period last year.
Expenses totaled $5.0 million for the three-month period ending December 31, 2006, as compared to $4.8 million recorded in the same period last year.
The EBITDA before research and development and other items for the three months ending December 31, 2006 totaled $(0.1) million as compared to $0.6 million recorded in the same period last year.
The Company recorded net loss before research and development and other items of $(1.8) million for the three-month period ending December 31, 2006, as compared to a loss of $(0.9) million recorded in the same period last year. This increase of $0.9 million reflects the decreased gross profit level attributed to timing of sales.
Gross research and development (R&D) expenses for the three-month period ending December 31, 2006 totaled $3.6 million as compared to $3.1 million reported in the same period last year. This increase of $0.5 million, or 13%, relates to increased staffing within the Bioniche Therapeutics clinical group and third party costs associated with the Phase III clinical trial along with increased administrative support.
Net loss from continuing operations for the three months ending December 31, 2006 totaled $(2.9) million, as compared to $(6.1) million recorded in the same period last year. The decrease in the loss of $3.2 million reflects the gain on the sale of future Suplasyn royalties of $2.1 million recorded in the three-month period ending December 31, 2006, and a reduction in other expenses. A one-time debt refinancing fee of $2.5 million was recorded in the three-month period ending December 31, 2005.
Highlights for Year-to-Date (6 months) Financial Results
On a year-to-date basis, consolidated revenues totaled $13.7 million this year compared to $12.2 million last year. This increase of $1.5 million, or 12%, primarily reflects increased sales for two of the Company's reproductive technologies, Folltropin(R)-V and Cue-Mate.
The overall gross profit margin on sales during the six-month period ending December 31, 2006 decreased to 57% from 60% reported in the same period last year. This decrease of 3% reflects ongoing inventory adjustments on one of the Company's foreign product lines.
Expenses were $8.8 million in the first six months, compared to 9.0 million for the same period last year, a small decrease of 2%.
EBITDA before research and development and other items were $1.7 million for the first six months, which compares to a $1.2 million recorded in the same period last year.
Gross research and development expenses for the first six months totaled $7.2 million, as compared to $6.0 million reported in the same period last year.
Net loss from continuing operations for the period reached $(5.7) million or $(0.14) per share (basic and fully diluted) compared with $(9.7) million or $(0.27) per share for the previous year.
"Our corporate energy continues to be directed to the successful completion of our priority projects -- Urocidin for the treatment of bladder cancer and the E. coli O157:H7 cattle vaccine - both of which will make a significant difference in the health of humans," concluded Mr. McRae.
About Bioniche Life Sciences
Bioniche Life Sciences Inc. is a research-based, technology-driven Canadian biopharmaceutical company focused on the discovery, development, manufacturing, and marketing of proprietary products for human and animal health markets worldwide. The fully-integrated company employs approximately 185 skilled personnel and has three operating business units: Human Health, Animal Health, and Food Safety. The Company's primary goal is to develop proprietary cancer therapies supported by revenues from marketed products in human and animal health. For more information, please visit www.Bioniche.com.
Except for historical information, this news release may contain forward-looking statements that reflect the Company's current expectation regarding future events. These forward-looking statements involve risk and uncertainties, which may cause but are not limited to, changing market conditions, the successful and timely completion of clinical studies, the establishment of corporate alliances, the impact of competitive products and pricing, new product development, uncertainties related to the regulatory approval process, and other risks detailed from time to time in the Company's ongoing quarterly and annual reporting.
For further information, please contact: Patrick Montpetit, CA Vice-President and Chief Financial Officer Bioniche Life Sciences Inc. Telephone: (514) 697-6636 ext. 2245 Patrick.Montpetit@Bioniche.com Jennifer Shea Corporate Communications & Investor Relations Manager Bioniche Life Sciences Inc. Telephone: (613) 966-8058 ext. 1250 Cell: (613) 391-2097 Jennifer.Shea@Bioniche.com Bioniche Life Sciences Inc. Amalgamated under the laws of Ontario CONSOLIDATED BALANCE SHEETS [Unaudited] As at December 31, As at June 30, 2006 2006 $ $ ASSETS Current Cash 3,625,395 4,093,293 Accounts receivable 4,673,226 5,644,956 Inventories 5,910,458 6,171,453 Prepaid expenses and deposits 540,719 804,470 14,749,798 16,714,172 Long-term Property, plant and equipment 9,699,803 10,138,797 Intangible assets 8,973,475 9,401,733 Goodwill 456,155 456,155 Deferred financing fees 448,978 1,258,236 Investment - 3,298,279 Other assets 100,000 100,000 34,428,209 41,367,372 LIABILITIES AND SHAREHOLDERS' EQUITY Current Revolving credit facility 1,594,376 3,162,097 Accounts payable and accrued liabilities 6,095,622 5,054,593 Income and other taxes payable 598,817 494,881 Deferred government incentives 3,485,824 3,433,007 Current portion of senior debt and capital leases 427,736 1,220,840 12,202,375 13,365,418 Long-term Senior debt 1,288,139 3,697,806 Obligations under capital lease 901,588 953,957 14,392,102 18,017,181 Shareholders' equity Share capital 74,796,457 72,686,901 Other paid-in capital 4,763,206 4,556,290 Deficit (59,523,556) (53,869,621) Cumulative translation adjustment - (23,379) 20,036,107 23,350,191 34,428,209 41,367,372 Bioniche Life Sciences Inc. CONSOLIDATED STATEMENTS OF DEFICIT [Unaudited] For the three and six months ended December 31 Current Last Year Current Last Quarter Quarter Year to Date Year to Date 2006 2005 2006 2005 $ $ $ $ Deficit, beginning of period (56,610,485) (56,048,703) (53,869,621) (52,726,240) Net loss for the period (2,913,071) (5,682,210) (5,653,935) (9,004,673) Deficit, end of period (59,523,556) (61,730,913) (59,523,556) (61,730,913) Bioniche Life Sciences Inc. CONSOLIDATED STATEMENTS OF LOSS [Unaudited] For the three and six months ended December 31 Current Last Year Current Last Quarter Quarter Year to Date Year to Date 2006 2005 2006 2005 $ $ $ $ REVENUE Sales 5,912,276 6,371,623 13,656,902 12,209,677 Cost of sales 2,745,283 2,378,380 5,936,128 4,907,684 Gross profit 3,166,993 3,993,243 7,720,774 7,301,993 EXPENSES Administration 1,442,452 1,418,054 2,572,743 2,424,639 Marketing and selling 1,431,408 1,592,153 2,852,872 2,942,429 Quality assurance 169,539 268,992 338,046 517,896 Interest on long- term debt 299,924 365,024 494,745 999,407 Other interest 71,527 98,663 144,731 75,597 Accreted interest on convertible term note 510,587 45,562 619,413 45,562 Share ownership plan and bonus 212,661 99,944 212,661 233,115 Amortization of capital assets 295,562 309,065 590,846 611,362 Amortization of intangible assets 214,130 214,131 428,259 428,260 Amortization of deferred financing fees 634,930 176,362 809,258 244,701 Foreign exchange loss (gain) (271,665) 260,860 (283,851) 493,703 5,011,055 4,848,810 8,779,723 9,016,671 Loss before research and development and other items (1,844,062) (855,567) (1,058,949) (1,714,678) Research and development expenses, gross 3,561,692 3,126,982 7,151,440 5,985,334 Less: government incentives, net (413,907) (392,035) (836,534) (483,234) Impairment of investment - - 175,000 - Loss on sale of investment 17,157 - 17,157 - Gain on sale of annual Suplasyn royalty payments (2,127,587) - (2,127,587) - Debt refinancing - 2,493,920 - 2,493,920 Loss from continuing operations before income taxes (2,881,417) (6,084,434) (5,438,425) (9,710,698) Provision for income tax expense 31,654 6,851 215,510 35,462 Loss from continuing operations (2,913,071) (6,091,285) (5,653,935) (9,746,160) Income from discontinued operations - 409,075 - 741,487 Net loss for the period (2,913,071) (5,682,210) (5,653,935) (9,004,673) Basic and diluted net income (loss) per share Continuing operations (0.07) (0.16) (0.14) (0.27) Discontinued operations - 0.01 - 0.02 Basic and diluted net loss per share (0.07) (0.15) (0.14) (0.25) Bioniche Life Sciences Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS [Unaudited] For the three and six months ended December 31 Current Last Year Current Last Quarter Quarter Year to Date Year to Date 2006 2005 2006 2005 $ $ $ $ OPERATING ACTIVITIES Loss from continuing operations (2,913,071) (6,091,285) (5,653,935) (9,746,160) Add (deduct) non cash items: Amortization 1,144,622 699,558 1,828,363 1,284,323 Accreted interest on convertible term note 510,587 45,562 619,413 45,562 Foreign exchange gain 351,777 129,936 345,644 103,121 Stock based compensation 55,242 37,534 111,022 110,709 Share compensation 81,000 90,002 81,000 90,002 Employee share ownership plan 212,662 141,840 212,662 278,194 Impairment of investment - - 175,000 - Loss on investment 17,157 - 17,157 - Gain on sale of future Suplasyn royalty payments (2,127,587) - (2,127,587) - Debt refinancing - 1,271,454 - 1,271,454 (2,667,611) (3,675,399) (4,391,261) (6,562,795) Net change in non- cash working capital balances 792,819 329,453 1,097,708 1,024,208 Cash used in operating activities (1,874,792) (3,345,946) (3,293,553) (5,538,587) INVESTING ACTIVITIES Payment relating to acquisition of net assets - - - (123,120) Proceeds from sale of investment 3,196,200 - 3,196,200 - Proceeds from sale of annual Suplasyn royalty Payments 3,652,800 - 3,652,800 - Government incentives received on account of capital assets 30,224 53,730 30,224 53,730 Purchase of capital assets (74,671) (193,569) (182,076) (316,913) Cash provided by (used in) investing activities 6,804,553 (139,839) 6,697,148 (386,303) FINANCING ACTIVITIES Proceeds from revolving credit facility - 4,051,250 - 4,051,250 Proceeds from term bridge loan - 8,681,250 - 8,681,250 Common shares issued - 1,053,693 - 1,053,693 Proceeds from convertible term note - 7,048,807 - 7,048,807 Financing fees - debt - (1,368,789) - (1,368,789) Proceeds on account of deferred government incentives 74,282 693,861 74,282 693,861 Proceeds (repayment) of revolving credit facility 12,113 - (653,367) - Repayment of senior and other long-term debt (2,982,467) (16,038,627) (3,292,408) (16,246,731) Cash provided by (used in) financing activities (2,896,072) 4,121,445 (3,871,493) 3,913,341 Net increase (decrease) in cash from continuing operations 2,033,689 635,660 (467,898) (2,011,549) Net increase in cash from discontinued operations - 344,318 - 779,762 Net increase (decrease) in cash for the period 2,033,689 979,978 (467,898) (1,231,787) Cash, beginning of period 1,591,706 1,315,643 4,093,293 3,527,408 Cash, end of period 3,625,395 2,295,621 3,625,395
Bioniche Life Sciences Inc.CONTACT: Patrick Montpetit, CA, Vice-President and Chief FinancialOfficer, +1-514-697-6636 ext. 2245, Patrick.Montpetit@Bioniche.com, orJennifer Shea, Corporate Communications & Investor Relations Manager,+1-613-966-8058 ext. 1250, or Cell, +1-613-391-2097,Jennifer.Shea@Bioniche.com, both of Bioniche Life Sciences Inc.
Web site: http://www.bioniche.com/
