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FOR IMMEDIATE RELEASE
February 24, 1998
CARDIOVASCULAR DIAGNOSTICS, INC. REPORTS 1997 FOURTH QUARTER AND YEAR END RESULTS
Raleigh, NC - February 24, 1998 -- Cardiovascular Diagnostics, Inc. (Nasdaq:CVDI) today reported results for its fourth quarter and year ended December 31, 1997.
During 1997, CVDI’s principal focus evolved towards the development of specialty tests which enable new, innovative drugs to be effectively administered. CVDI was selected in April 1997 by Eli Lilly and Company (NYSE:LLY) to collaborate on a diagnostic test for a marker to be used with Lilly’s new drug for treating sepsis. Later in the year, CVDI proved feasibility for the test. In addition, during the year, CVDI began a second collaboration with Knoll AG to develop a fibrinogen test to be used with a new thrombin inhibitor to treat strokes. CVDI’s first collaboration with Knoll, developing an Ecarin Clotting Time (ECT) test for Knoll’s new thrombin inhibitor, PEG-Hirudin, resulted in a $2.1 million order for CVDI’s Thrombolytic Assessment System (TAS() analyzers and test cards in early 1998. The Lilly drug is currently completing Phase II trials, and both Knoll drugs will be in Phase III clinical trials in the second quarter of 1998.
Marketing of CVDI’s tests for routine anticoagulants by Dade Behring, CVDI’s North American distributor, was delayed while the dry chemistry tests were calibrated to conform to Dade’s wet chemistry reagents. Meanwhile, the Company increased the number of commercial tests and controls to 13 from seven, and commenced a multi-site trial in Europe of its tests throughout a patient’s hospital stay. Agreements to distribute the routine tests in niche markets were signed with Avecor Cardiovascular (Nasdaq:AVEC) and with Johnson & Johnson’s Ortho Clinical Diagnostics. Toward the end of the year, CVDI entered into discussions with several firms about long-term arrangements for accelerating these tests’ market penetration.
With its routine tests in the early stages of commercialization and its specialty tests in field and clinical trials, the Company’s financial strategy is to supplement revenues from the sale of TAS
analyzers and cards with cash flow from sales of manifolds and syringes by its Coeur Labs subsidiary, as well as through development collaborations. Reflecting a 60 percent increase in sales of analyzers and test cards, CVDI’s total revenues for 1997 were $7,618,000, compared with $6,412,000 a year ago, an increase of 19 percent. The Company’s net loss for the year narrowed to $4,679,000, or $0.70 per share, from $5,121,000, or $0.78 per share in 1996. Compared to the same quarter in 1996, revenues for the fourth quarter of 1997 rose 17 percent to $1,898,000, which included a 40 percent increase in sales by Coeur Labs. The net loss for the quarter was $1,805,000, or $0.27 per share, compared with $1,371,000, or $0.21 per share in the fourth quarter of 1996. At year end, cash and equivalents totaled $5,885,000, which included proceeds from a $3,000,000 equipment-based financing.
“Highlighting CVDI’s year was the formation of two additional collaborations, with Lilly and Knoll, for tests to be used with new drugs currently in clinical trials, and the subsequent successful development of those tests,” commented John Funkhouser, President and Chief Executive Officer. “As these drugs progress through clinical trials, CVDI test cards and analyzers may be supplied to trial participants, and if and when the drugs receive marketing clearance, become part of best practices in the use of the drugs. Subsequently, as the installed base of analyzers expands throughout the clinical community, we believe the benefits of the TAS technology will fuel further demand for analyzers and test cards for both specialty and routine anticoagulant tests.”
Mr. Funkhouser continued, “While the commercialization of our TAS tests for routine anticoagulants is taking longer than planned, our belief in their potential to provide hospitals with superior point-of-care diagnostics has never been stronger. Accordingly, we have entered into discussions with several firms with the resources to successfully complete the commercialization, and explore a number of possible arrangements, including a joint venture and/or the sale of manufacturing rights.
“By focusing on specialty tests which enable specific new drugs to be effectively administered,” Mr. Funkhouser concluded, “CVDI is positioning its TAS( analyzers and test cards to benefit from pull-through demand from the sale of the related drugs, and is targeting markets which offer opportunities for direct distribution and attractive margins.”
Cardiovascular Diagnostics, Inc. develops, manufactures and markets rapid turnaround, point-of-care diagnostics to assess blood clot formation and dissolution. CVDI develops tests based on its proprietary, dry chemistry Thrombolytic Assessment System (TAS() for powerful new therapeutics with narrow ranges between over- and under-dosage, which represent CVDI’s principal target market, as well as for monitoring routine anticoagulants. CVDI is collaborating on diagnostics for drugs in clinical trials with Eli Lilly for a sepsis marker, and with Knoll AG for PEG-Hirudin and ancrod. CVDI’s therapeutic diagnostics are used in the treatment of angina, myocardial infarction (heart attack), stroke, deep venous thrombosis, and pulmonary and arterial emboli.
(Financial Tables Follow)
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To receive CVDI’s latest news release and other corporate documents via FAX- no cost- dial 1-800-PRO-INFO. Use company’s ticker, CVDI. Or visit The Financial Relations Board’s web site at http://www.frbinc.com.
This press release contains forward-looking statements regarding future events and the future performance of Cardiovascular Diagnostics that involve risks and uncertainties that could cause actual results to differ materially from those projected in the forward-looking statements. Information concerning factors that could cause actual results to materially differ from those in the forward-looking statements is contained in the Company’s SEC filings, including Form 10-K, Form 10-Q and Form 8-K reports.
CARDIOVASCULAR DIAGNOSTICS, INC.
SELECTED FINANCIAL SUMMARY
CONSOLIDATED INCOME STATEMENTS
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Three Months Ended |
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Twelve Months Ended
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December 31, |
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December 31, |
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December 31, |
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December 31,
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1997
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1996
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1997
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1996
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| Total sales |
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$ 1,898,318 |
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$ 1,615,976 |
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$ 7,618,473 |
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$ 6,411,519 |
| Cost of goods sold |
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1,735,355
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1,509,250
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6,169,112
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5,257,044
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| Gross profit |
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162,963 |
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106,726 |
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1,449,361 |
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1,154,475 |
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| Operating expenses |
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2,028,343
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1,857,319
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7,514,116
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7,128,970
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| Operating loss |
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(1,865,380) |
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(1,750,593) |
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(6,064,755) |
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(5,974,495) |
| Other income (expense) |
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99,441 |
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373,685 |
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1,467,627 |
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905,711 |
| Net loss before taxes |
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(1,765,939) |
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(1,376,908) |
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(4,597,128) |
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(5,068,784) |
| Provision for income taxes |
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(39,264)
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5,683
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(82,083)
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(51,860)
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| Net loss |
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(1,805,203)
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(1,371,225)
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(4,679,211)
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(5,120,644)
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| Net loss per share |
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($0.27) |
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($0.21) |
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($0.70) |
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($0.78) |
Average weighted shares
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6,741,872
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6,667,732
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6,722,491
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6,566,134
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| CONSOLIDATED BALANCE SHEETS |
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December 31, 1997
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December 31, 1996
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| Current assets |
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$ 10,987,094
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$ 12,198,120
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| Total assets |
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$ 17,684,503
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$ 18,351,355
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| Current liabilities |
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$ 2,140,620
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$ 616,030
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| Total liabilities |
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$ 4,491,795 |
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$ 683,017 |
| Total shareholders’ equity |
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$ 13,192,708
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$ 17,668,338
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| Total liabilities and equity |
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$ 17,684,503
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$ 18,351,355
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