Record Volume of MyPRS® Tests Sold During the Year
CARLSBAD, Calif., March 30, 2015 (GLOBE NEWSWIRE) -- Signal Genetics, Inc. (Nasdaq:SGNL) (Signal), a commercial stage, molecular genetics diagnostic company focused on providing innovative diagnostic services that help physicians make better-informed decisions concerning the care of their patients suffering from cancer, today reported recent achievements and financial results for the full-year ended December 31, 2014.
Recent Highlights
- Achieved record volume of MyPRS® tests sold, which includes a 50% increase to non-University of Arkansas for Medical Sciences (UAMS) hospitals
- Raised approximately $10.4 million through a secondary offering, which includes the fully-exercised over-allotment option
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Received conditional approval of Investigational Device Exemption (IDE) from the U.S. Food and Drug Administration (FDA) for our proprietary prognostic genetic test, MyPRS (Myeloma Prognostic Risk Signature)
- Test to be used as entry criteria for an upcoming clinical trial to treat high-risk multiple myeloma (MM) patients sponsored by UAMS
Samuel D. Riccitelli, Signal's President and Chief Executive Officer, commented, "2014 was an exciting year for Signal, as we achieved several milestones that we believe will contribute to our long-term success. Most notably, we raised $8.5 million through our initial public offering in June 2014. With this capital, we were able to begin executing our growth strategy by building our infrastructure. This consisted of hiring key members of our leadership team and expanding our sales force, as well as relocating our headquarters to a new facility. In addition, we continued to grow our non-UAMS hospital business in which we saw a 50% growth in volume year-over-year. This is an essential market opportunity for us to take advantage of as we believe this will initially be the main driver of growth and the key focus of our expanding sales force."
Mr. Riccitelli concluded, "As we enter 2015, we have further strengthened our balance sheet with a capital raise of over $10 million in February which included the full exercise of the over-allotment option, which we believe is a positive reflection of Signal and the goals we are working to achieve. With this additional capital, we are well positioned to further expand our footprint and penetrate the large market opportunity that we believe exists for our prognostic genetic test as we work to help physicians manage the care of these patients and to create long-term value for our stockholders."
2014 Full Year Financial Results
Net revenue for the year ended December 31, 2014 was $4.3 million which was essentially the same when compared to the full year 2013. Net revenues for 2014 and 2013 include net unfavorable changes in estimates of $380,000 and $57,000, respectively, related to adjustments for revenues recognized in prior years. The number of tests billed for UAMS-sourced and non-UAMS customers increased approximately 7% and 37%, respectively, in 2014 compared to 2013 due to an increase in business from each. Included in the increase in non-UAMS customer tests is a 50% increase in tests sourced from non-UAMS hospitals.
Cost of revenue was $3.2 million, or 75% of net revenues, during 2014, an increase of $465,000, or 17%, compared to $2.8 million, or 64% of net revenues, during 2013. The increase was primarily attributable to stock-based compensation expense, not previously incurred as a private company, and increased material and supply costs due to increases in costs from our suppliers.
Research and development expenses totaled approximately $293,000 for 2014 compared to approximately $225,000 for 2013. The year-over-year increase in research and development was primarily attributable to the addition of stock-based compensation not previously incurred as a private company, offset by a decrease in research and development expenses caused by the discontinuation of certain research projects that were deemed not to be viable.
Selling and marketing expenses were $717,000 during 2014, an increase of $368,000, or 105%, when compared to $349,000 during 2013. The increase in selling and marketing expenses was primarily attributable to personnel costs related to expanding our sales and marketing staff and recruiting expenses related to hiring additional personnel.
General and administrative expenses were $7.0 million during 2014, an increase of $5.6 million, or 400%, when compared to $1.4 million during 2013. The increase was primarily attributable to growing our staff, the addition of stock-based compensation not previously incurred, costs associated with becoming a publicly-traded company in June 2014, relocation of headquarters to a new facility, bad debt expense related to expensing uncollectible accounts receivable, and increased human resources and other administration-related consulting fees.
Net loss attributable to stockholders for the full year 2014 was approximately $7.9 million, or $3.50 per share, compared to $2.4 million, or $12.23 per share, during the year ended December 31, 2013.
As of December 31, 2014, the Company had cash of $5.1 million and working capital of $4.8 million.
About Signal Genetics, Inc.
Signal Genetics, Inc., headquartered in Carlsbad, California, is a commercial stage, molecular diagnostic company focused on providing innovative diagnostic services that help physicians make better-informed decisions concerning the care of their patients suffering from cancer. Signal's mission is to develop, validate and deliver innovative diagnostic services that enable better patient-care decisions. Signal was founded in January 2010 and became the exclusive licensee in its licensed field to the renowned research on multiple myeloma performed at the University of Arkansas for Medical Sciences, in April 2010.
Safe Harbor Statement
This press release contains "forward-looking" statements. Such statements can be identified by, among other things, the use of forward-looking language such as the words "may," "will," "expect," "anticipate," "estimate," "project," "would," "could" or words with similar meaning or the negatives of these terms or by the discussion of strategy or intentions. The forward-looking statements in this release include statements regarding our ability to achieve profitability and to penetrate the market opportunity that we believe exists for our prognostic genetic test. Such forward-looking statements are subject to a number of risks and uncertainties that could cause our actual results to differ materially from those discussed here, such as our ability to obtain adequate coverage and reimbursement for our tests from third party payors, our ability to obtain necessary regulatory clearances and approvals, the ability of our tests to keep pace with rapid advances in technology, medicine and science, and our ability to execute our marketing strategy and gain acceptance in the market, along with those other risks and uncertainties detailed in our SEC filings, and involve assumptions, estimates, and uncertainties that reflect current internal projections, expectations or beliefs. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. All forward looking statements contained in this press release are qualified in their entirety by these cautionary statements and the risk factors described above. Furthermore, all such statements are made as of the date this release and we assume no obligation to update or revise these statements unless otherwise required by law.
| SIGNAL GENETICS, INC. | ||
| CONSOLIDATED BALANCE SHEETS | ||
| (in thousands, except share and par value data) | ||
| December 31, | ||
| 2014 | 2013 | |
| ASSETS | ||
| Current assets: | ||
| Cash | $ 5,119 | $ 209 |
| Restricted cash | 50 | 50 |
| Accounts receivable, net | 1,088 | 994 |
| Inventory | 179 | 357 |
| Prepaid expenses and other current assets | 349 | 445 |
| Total current assets | 6,785 | 2,055 |
| Property and equipment, net | 1,214 | 928 |
| Deferred offering costs | 47 | 655 |
| Security deposits | 43 | 35 |
| Total assets | $ 8,089 | $ 3,673 |
| LIABILITIES AND STOCKHOLDERS' EQUITY/MEMBERS' DEFICIENCY | ||
| Current liabilities: | ||
| Accounts payable | $ 255 | $ 100 |
| Accrued liabilities | 361 | 271 |
| Amounts due to related party | 1,045 | — |
| Lease termination/abandonment payable - current portion | 248 | 319 |
| Capital lease liability–current portion | 80 | — |
| Note payable – current portion | — | 42 |
| Note payable – related party | — | 26,569 |
| Total current liabilities | 1,989 | 27,301 |
| Other noncurrent liabilities | 109 | — |
| Lease termination/abandonment payable | — | 259 |
| Commitments and contingencies | ||
| Stockholders' equity/members' deficiency: | ||
| Preferred stock, $0.01 par value, 5,000,000 shares authorized, no shares issued or outstanding at December 31, 2014 or 2013 | — | — |
| Common stock, $0.01 par value, 50,000,000 shares authorized, 3,782,629 shares issued and outstanding at December 31, 2014 and no shares issued and outstanding at December 31, 2013 | 38 | — |
| Additional paid in capital | 12,593 | — |
| Accumulated deficit | (6,640) | — |
| Members' deficiency | — | (23,887) |
| Total stockholders' equity (members' deficiency) | 5,991 | (23,887) |
| Total liabilities and stockholders' equity/members' deficiency | $ 8,089 | $ 3,673 |
| SIGNAL GENETICS, INC. | ||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||
| (in thousands, except share and per share data) | ||
| Years Ended December 31, | ||
| 2014 | 2013 | |
| Net revenue | $ 4,320 | $ 4,316 |
| Operating expenses: | ||
| Cost of revenue | 3,243 | 2,778 |
| Research and development | 293 | 225 |
| Selling and marketing | 717 | 349 |
| General and administrative | 7,034 | 1,411 |
| Gain on legal settlement | (100) | (250) |
| Total operating expenses | 11,187 | 4,513 |
| Loss from operations | (6,867) | (197) |
| Interest expense | (1,023) | (1,963) |
| Net loss attributable to members of Signal Genetics LLC | (1,250) | (2,160) |
| Net loss attributable to stockholders of Signal Genetics, Inc. | (6,640) | — |
| Dividend to member unit holder of Myeloma Health LLC | — | (285) |
| Net loss attributable to stockholders of Signal Genetics, Inc./members of Signal Genetics LLC | $ (7,890) | $ (2,445) |
| Net loss per common share, basic and diluted | $ (3.50) | $ (12.23) |
| Weighted-average number of shares outstanding, basic and diluted | 2,255,864 | 200,000 |