Sontra Medical Reports Third Quarter 2005 Results And Business Update

FRANKLIN, Mass., Nov. 14 /PRNewswire-FirstCall/ -- Sontra Medical Corporation announced financial results today for the three and nine months ended September 30, 2005. For the three months ended September 30, 2005, the net loss applicable to common stockholders was $1,511,000, or $.07 per share, as compared to $1,302,000, or $.07 per share, for the same period in 2004. For the nine months ended September 30, 2005, the net loss applicable to common stockholders was $4,556,000, or $.21 per share, as compared to $4,112,000, or $.26 per share, for the same period in 2004. The Company ended the quarter with $5,282,000 in cash and short-term investments on hand and expects that these funds will be sufficient to fund operations through at least June 2006.

Third Quarter Product Highlights: Continuous Transdermal Glucose Monitoring System * Designed clinical protocols for hospital intensive care unit (ICU) product; human trials to commence in 2006. * Fabricated prototypes of new telemetry-based glucose flux biosensor and wireless meter; patients with diabetes to be tested in early 2006. * Completed ISO audit and recommended for ISO 13485 certification; planning to achieve European CE mark approval for SonoPrep(R) skin permeation device in 2006. Transdermal Vaccination Facilitated by SonoPrep(R) * Forged research partnership with EpiVax and commenced pre-clinical studies using SonoPrep skin permeation device to deliver EpiVax’s HIV vaccine. * Awarded grant from U.S. Army to investigate the use of SonoPrep to deliver the dengue vaccine transdermally. SonoPrep(R) and Procedure Tray for Topical Lidocaine * Launched product to pediatric offices. * Product evaluations continuing at large pediatric hospitals. * Results from Hasbro pediatric clinical study accepted for publication in the Pediatric Emergency Care journal.

Sontra is continuing to negotiate the terms of an agreement with Bayer HealthCare LLC’s Diabetes Care Division related to the continued development of a continuous non-invasive glucose monitoring system. Such agreement is expected to revise and define product development activities, deliverables, milestones and payments, including the $3 million milestone payment upon completion of Phase 1 of Bayer’s development process. The Company expects to execute this agreement during the fourth quarter of fiscal 2005 and will make an announcement and conduct a conference call at that time.

“We are very pleased with the progress we have made in the development of our continuous transdermal glucose monitor for the hospital ICU market,” stated Thomas W. Davison, PhD, Sontra’s President and Chief Executive Officer. “We have completed the fabrication of our first prototypes so that validation clinical studies in critical care can commence in 2006. Frequent glucose monitoring and intensive insulin therapy have become a standard of care in critical care medicine, as tight glucose control has been shown to significantly reduce patient mortality, complications, hospital stay and cost. As a result, intensive care nurses are measuring blood glucose for their patients up to every hour in order to adjust insulin infusion rates. Development of our critical care glucose monitor is proceeding in parallel with the development of a product for the $5 billion diabetes home testing market, as the product technologies are the same and designs are very similar.”

Dr. Davison continued, “In transdermal vaccination, the knowledge we gained in our recently completed studies with the influenza and Hepatitis A vaccines is helping us optimize the formulation and delivery of vaccines through ultrasonically permeated skin. We recently developed research partnerships with EpiVax and the U.S. Army, and we expect to enter into future R&D research partnerships to incorporate SonoPrep technology into the development of novel therapeutic and prophylactic vaccines.”

Dr. Davison concluded, “The selling effort and sales cycle required for adoption of SonoPrep and procedure trays for topical lidocaine anesthesia in pediatric hospitals are more extensive than our original expectations. Nevertheless, utilization at adopting hospitals is encouraging. While we avoided significant selling costs by entering this market through independent distributors, we learned that successful evaluations require a concerted direct sales effort. We are currently reevaluating our distribution strategy and are exploring alternative sales and marketing methods.”

About Sontra Medical Corporation (http://www.sontra.com)

Sontra Medical Corporation is a technology leader in transdermal science. Sontra’s SonoPrep ultrasound-mediated skin permeation technology, combined with technical competencies in transdermal drug formulation, delivery systems and biosensors, is creating a new paradigm in transdermal drug delivery and diagnosis. The SonoPrep technology has demonstrated strong results from its initial human clinical trials at leading universities and medical centers for several billion dollar market opportunities, including the transdermal delivery of vaccines and large molecule drugs and continuous non-invasive glucose monitoring. Sontra is currently marketing the SonoPrep device and procedure tray for use with topical lidocaine to achieve rapid (within five minutes) skin anesthesia.

Investor Relations Contact: Sean Moran, Chief Financial Officer 508-530-0334

SonoPrep is a registered trademark of Sontra Medical Corporation. All other company, product or service names mentioned herein are the trademarks or registered trademarks of their respective owners.

This press release contains forward-looking statements, which address a variety of subjects including, for example, the expected benefits and efficacy of the SonoPrep device in connection with diagnostics, vaccine delivery, glucose monitoring and transdermal drug delivery, the expected timing, terms and benefits of the development agreement with Bayer, the expected market opportunities, clinical study and product evaluation results, distribution and market acceptance of the SonoPrep device and technology, the expected size of the markets for the SonoPrep device and technology, Sontra’s expected ability to form strategic partnerships and commercialize additional products, including for the hospital intensive care unit and for vaccine delivery, the expected benefits of our current and expected strategic partnerships, and Sontra’s business, research, product development, regulatory approval, marketing and distribution plans and strategies. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Such statements are based on our current expectations and are subject to a number of factors and uncertainties, which could cause actual results to differ materially from those described in the forward-looking statements. The following important factors and uncertainties, among others, could cause actual results to differ materially from those described in these forward-looking statements: our technology is new and we may experience adverse results in research collaborations, product development, clinical trials, product evaluations, commercialization efforts, product distribution and market acceptance; the SonoPrep device may not prove effective in connection with diagnostics, vaccine delivery, glucose monitoring and/or transdermal drug delivery; markets for our products may develop slower than expected, or not at all; our sales cycle is lengthy and we are still developing sales and marketing strategies which may or may not prove effective; difficulties or delays in obtaining regulatory approvals to market products resulting from development efforts; difficulties or delays associated with sources of regulatory-approved transdermal drugs and vaccines; failure to obtain and maintain patent protection for discoveries; commercial limitations imposed by patents owned or controlled by third parties; dependence upon strategic partners and third-party distributors to develop, commercialize, market and sell products based on our work; and the requirement for substantial funding to conduct research and development and to expand commercialization, distribution and marketing activities. For detailed information about factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to Sontra’s filings with the Securities and Exchange Commission, including Sontra’s most recent Quarterly Report on Form 10-QSB. Forward-looking statements represent management’s current expectations and are inherently uncertain. We do not undertake any obligation to update forward-looking statements made by us.

SONTRA MEDICAL CORPORATION Consolidated Statements of Loss (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2005 2004 2005 2004 Product revenue $20,615 $12,254 $169,018 $14,754 Cost of product revenue 149,209 5,523 246,068 6,324 Gross (loss) profit (128,594) 6,731 (77,050) 8,430 Operating Expenses: Research and development 998,026 726,261 2,943,821 2,064,785 Selling, general and administrative 427,564 598,265 1,681,341 1,691,961 Total operating expenses 1,425,590 1,324,526 4,625,162 3,756,746 Loss from operations (1,554,184) (1,317,795) (4,702,212) (3,748,316) Interest income 50,670 17,503 163,151 49,260 Interest expense (5,804) - (12,809) - Net loss (1,509,318) (1,300,292) (4,551,870) (3,699,056) Accretion of dividend and beneficial conversion feature on Series A Convertible Preferred Stock (1,479) (1,479) (4,389) (412,452) Net loss applicable to common stockholders $(1,510,797) $(1,301,771) $(4,556,259) $(4,111,508) Net loss per common share, basic and diluted $(0.07) $(0.07) $(0.21) $(0.26) Basic and diluted weighted average common shares outstanding 22,233,964 18,339,560 22,186,347 15,741,981 SONTRA MEDICAL CORPORATION Consolidated Balance Sheets As of September 30, December 31, 2005 2004 (Unaudited) ASSETS Current Assets: Cash and cash equivalents $781,747 $2,565,244 Short term investments 4,500,000 6,950,000 Accounts receivable 4,887 16,821 Legal settlement receivable - 250,000 Inventory, net of reserve for obsolescence 59,408 152,642 Prepaid expenses and other current assets 91,693 69,492 Total current assets 5,437,735 10,004,199 Property and Equipment, at cost Computer equipment 241,323 206,970 Office and laboratory equipment 593,576 492,377 Furniture and fixtures 14,288 14,288 Manufacturing equipment 197,888 182,210 Leasehold improvements 177,768 174,698 1,224,843 1,070,543 Less-Accumulated depreciation and amortization (861,617) (655,242) Net property and equipment 363,226 415,301 Other Assets: Restricted cash 29,248 38,997 Other assets 149,741 2,000 Total Other Assets 178,989 40,997 Total assets $5,979,950 $10,460,497 LIABILITIES AND STOCKHOLDERS’ EQUITY Current Liabilities: Accounts payable $227,406 $358,530 Current portion of note payable 56,889 - Accrued expenses 388,651 759,051 Total current liabilities 672,946 1,117,581 Note payable, net of current portion 158,375 - Commitments Stockholders’ Equity: Series A Convertible Preferred Stock, $0.01 par value, authorized 7,000,000 shares, issued and outstanding 73,334 shares at September 30, 2005 and December 31, 2004 (preference in liquidation of $74,813) 74,813 76,291 Common stock, $0.01 par value, authorized 60,000,000 shares, issued and outstanding 22,243,674 shares at September 30, 2005 and 21,935,732 shares at December 31, 2004 222,437 219,358 Additional paid-in capital 32,827,532 32,674,740 Deferred stock-based compensation (41,722) (244,912) Accumulated deficit (27,934,431) (23,382,561) Total stockholders’ equity 5,148,629 9,342,916 Total liabilities and stockholders’ equity $5,979,950 $10,460,497

Sontra Medical Corporation

CONTACT: Sean Moran, Chief Financial Officer of Sontra MedicalCorporation, +1-508-530-0334

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