AUSTIN, Texas, Nov. 13, 2014 /PRNewswire/ -- Vermillion, Inc. (NASDAQ: VRML), a bio-analytical solutions company focused on gynecologic disease, reported on its results for the quarter ended September 30, 2014.
“We have made excellent progress rebuilding our management team and devising an expanded strategy, while maintaining operational momentum in development projects and enhancing our commercial capabilities,” said James LaFrance, Chairman, President and CEO of Vermillion, Inc.
“We are actively transforming ourselves from a diagnostics company to a bio-analytical solutions company addressing a significantly larger market opportunity. On our earnings call today we will discuss the elements and timing of the phases of our transformation.”
Key Developments
- Redesigned corporate strategy with the goal of transforming Vermillion from a diagnostic company to a bio-analytic solutions provider. We plan to broaden our commercial focus from ovarian cancer to differential diagnosis of women with a range of gynecological disorders.
- Completed development work, with successful initial results, on a second-generation Ova1® biomarker panel. The product will be available on the Roche Cobas platform. The Company plans to file for FDA clearance in early 2015, in concert with publishing the related study data, with the goal of launching in the second half of 2015.
- Appointed Valerie Palmieri to the new position of Chief Operating Officer, effective October 23, 2014. Ms. Palmieri has over 30 years of experience in the diagnostic laboratory industry, including LabCorp and DIANON Systems, serving in numerous sales, operations, and executive leadership positions.
- Named Holly B. Bauzon as Vice President of Sales and Managed Markets, effective September 2, 2014. Ms. Bauzon brings more than 20 years of healthcare experience, most recently with PerkinElmer, Inc., where she held the position of Director, Lab Services Sales and Managed Markets.
Q3 2014 Financial Results
Total revenue in the third quarter of 2014 was $323,000, as compared to $330,000 in the same year-ago period. Third quarter 2014 revenue was comprised of $209,000 in OVA1 product revenue and $114,000 in license revenue.
The product revenue in the third quarter of 2014 was derived from 4,325 OVA1 tests which was consistent with the same year-ago quarter. Revenue from tests performed at Quest Diagnostics was recognized at the fixed $50 per test. No revenue was recorded for ASPiRA LABS tests performed as revenue will be recognized upon cash receipt.
OVA1 product revenue in the third quarter of 2014 and 2013 does not include the additional royalty component of revenue based on 33% of Quest Diagnostics’ gross margin. Vermillion will recognize this portion of revenue when it is reported by Quest Diagnostics in an annual ‘true-up’, which is expected after the end of the calendar year. The true-up is based on reimbursed and unreimbursed tests for which Quest Diagnostics considers the payment status as final.
Cost of revenue totaled $606,000 in the third quarter of 2014 representing both recurring and approximately $200,000 of non-recurring costs for ASPiRA LABS.
Total operating expenses in the third quarter of 2014 increased to $5.3 million from $2.6 million in the year-ago quarter. The increase was primarily due to operational investments including a significant expansion of the Company’s salesforce and increased research and development to complete development work for the Company’s second-generation test.
Net loss for the third quarter was $5.6 million or $(0.16) per share, as compared to a net loss of $2.3 million or $(0.10) per share in the year-ago quarter.
As of September 30, 2014, cash and cash equivalents totaled $16.8 million. The Company used $5.4 million in cash for operations in the third quarter of 2014, and expects to utilize $4.5 million to $5.0 million in cash in the fourth quarter of 2014 which will include certain non-recurring costs.
Conference Call and Webcast
Vermillion will hold a conference call to discuss its third quarter results later today, Thursday, November 13, 2014, at 4:30 p.m. Eastern time.
To read full press release, please click here.
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