TORONTO, CANADA, March 15, 2010: GeneNews Limited (TSX: GEN), an emerging molecular diagnostics company focused on the application of functional genomics to enable early diagnosis and personalized health management, today reported operational and financial results for the year ended December 31, 2009.
Highlights for 2009:
• Granted a U.S. patent for the Company’s core platform technology, the Sentinel Principle®, a powerful method for identifying clinically actionable biomarkers relating to disease and health from a basic blood sample.
• Publication of positive validation data in the International Journal of Cancer for a novel blood-based, seven-gene biomarker panel for colorectal cancer that can stratify average risk patients according to their current relative risk of actually having colorectal cancer, the basis of the Company's lead product ColonSentry™.
• Publication of a paper in the Journal of Clinical Gastroenterology reporting data using GeneNews' core Sentinel Principle® platform technology to identify complex changes in blood gene expression patterns that were differentially regulated between active and inactive Crohn's disease.
• Obtained a commitment of MYR 5 million (CDN$1.53 million) from the Malaysian Ministry of Health for the development of diagnostic tests for liver cancer and hepatitis based on the Company's core Sentinel Principle® platform technology.
• Entered into an agreement allowing Eli Lilly and Company (NYSE: LLY) select access to clinical data from GeneNews’ osteoarthritis genomic biomarker program.
• Appointed Dr. David Sable, a portfolio manager at New York-based Special Situations Funds, to the GeneNews Board of Directors.
• Strengthened the Company’s balance sheet by completing two non-brokered common share private placements for total gross proceeds in the amount of approximately $4.3 million and two tranches of a convertible debenture placement for gross proceeds of approximately $2.2 million.
Outlook for 2010
The Company anticipates the achievement of the following milestones in 2010:
• The commercial launch of ColonSentry™ in New York and New Jersey by GeneNews' exclusive partner for these U.S. states, Enzo Clinical Labs.
• The engagement of additional partners to establish a global ColonSentry™ marketing and distribution network that will make this lead product available to patients in Europe, China, Malaysia, and regions of the United States not covered by GeneNews' current agreement with Enzo.
• The initiation of additional clinical and economic studies to support the pursuit of public and private health insurance reimbursement for ColonSentry™.
• Expanded adoption and use of ColonSentry™ in Canada.
• Additional patent issuances to expand the scope of protection for the Company's Sentinel Principle® platform technology to include all aspects of personalized health management from early detection, to determining response, to treatment, and to protect the use of biomarkers derived from the application of the Sentinel Principle® to specific clinical applications.
• Partnering to advance further development of GeneNews' pipeline of molecular products based upon the Sentinel Principle®.
• Expansion of the Company’s shareholder base and access to additional working capital to support the pursuit of its milestones.
“We went into 2009 confident that our focus on the refinement and initial execution of our global ColonSentry™ commercialization plan would generate improved operational and financial performance throughout the year,” said Gailina Liew, President and Chief Operating Officer. “Our 2009 achievements demonstrate the success of that focus. Now, as we move through 2010, our primary goal will be to drive awareness and clinical adoption of ColonSentry™ as a cost-effective and patient-friendly first step to facilitate greater adherence to colorectal cancer screening guidelines.”
“GeneNews’ position as an emerging leader in the fields of molecular diagnostics and personalized health management is well protected by the expanding patent position of its disruptive Sentinel Principle® technology platform. We expect this leadership position, combined with continued strong management execution, will result in the realization of additional quality commercialization opportunities in 2010,” added Dr. Heiner Dreismann, Lead Director and interim CEO.
In February 2010, a second US patent protecting the application of blood biomarkers identified by the Company’s core Sentinel Principle® platform technology to any health management context was granted.
Financial results for the fourth quarter and year-ended December 31, 2009:
For the three months ended December 31, 2009, the Company reported a consolidated net loss of $463,654, or $0.00 loss per common share, as compared to a consolidated net loss of $2,673,688, or $0.05 loss per common share for the three months ended December 31, 2008. For the year ended December 31, 2009, the Company reported a consolidated net loss of $5,593,869 or $0.09 loss per common share, as compared to a consolidated net loss of $13,171,503 or $0.24 loss per common share for the year ended December 31, 2008. This improved financial performance is primarily due to a 76% reduction in research and development costs that resulted from reductions in the number of scientific and technical staff needed to support the Company’s research and development activities through its Canadian operations and significant reductions in direct program costs associated with the ColonSentry™ sampling program that was completed in the fourth quarter of 2008.
As at December 31, 2009, the Company’s unrestricted cash and cash equivalents and cash held in trust amounted to $2.8 million as compared with $1.4 million as at December 31, 2008. Since the fourth quarter of 2008, the Company has taken measures to conserve cash and has substantially reduced the overall use of capital in the near term. Even with these measures in place, the Company's cash and cash equivalents and cash held in trust are only sufficient to support the Company's activities into the fourth quarter of 2010. The Company is in discussions with several potential strategic partners to obtain additional operating capital and provide access to additional commercialization capabilities. The Company has also engaged financial advisors to assist the Company to raise further funds.
The Company had 69,027,881 common shares, 9,171,463 stock options and 13,009,372 warrants outstanding as at December 31, 2009.
The Company’s annual financial statements and management’s discussion and analysis are available on www.sedar.com.
Notice of Annual General Meeting:
GeneNews will hold its Annual Shareholder Meeting at 4:30pm on May 3, 2010 at the offices of Fasken Martineau DuMoulin LLP located at 66 Wellington St. W., 42nd floor, Toronto, Ontario.
About GeneNews
GeneNews is an emerging molecular diagnostics company focused on the application of functional genomics to enable early diagnosis and personalized health management based on disease-specific biomarkers. The Company has been granted two U.S. patents for its core platform technology, the Sentinel Principle®, which has the power to detect and stage virtually any disease or medical condition from a simple blood sample. GeneNews is currently applying the Sentinel Principle® in major areas with unmet clinical needs such as cancer, arthritis, cardiovascular disease and neurological disorders. GeneNews launched its first commercial product, ColonSentry™, a blood-based test to assess an individual's risk for colorectal cancer, in Canada in 2008. The Company expects ColonSentry™ to be introduced to the New York and New Jersey markets, via GeneNews' exclusive partnership for these U.S. states with Enzo Clinical Labs, in the second half of 2010. For more information on GeneNews and ColonSentry™, visit www.genenews.com and www.colonsentry.com.
Forward-Looking Statements
This press release contains forward-looking statements, which reflect the Company's current expectations regarding future events. The forward-looking statements involve risks and uncertainties. Actual events could differ materially from those projected herein. Investors should consult the Company's ongoing quarterly filings and annual reports for additional information on
risks and uncertainties relating to these forward-looking statements. The reader is cautioned not to rely on these forward-looking statements. The Company disclaims any obligation to update these forward-looking statements.
