Spectral Announces Second Quarter 2013 Results
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Spectral Diagnostics Inc. has announced its unaudited financial results for the second quarter ended June 30, 2013.
Second Quarter Highlights:
• Enrolled patients into the Company's Phase III EUPHRATES trial at an accelerated rate compared to the prior year. Directed by the Company's Endotoxin Activity Assay (EAA™), which is the only FDA-cleared diagnostic for the risk of developing sepsis, Spectral's EUPHRATES trial is targeted to enroll 306 evaluable patients. Contingent on maintaining current enrollment rates and timely site start ups, the trial should be fully enrolled in the second half of 2014. As of August 12, 2013, 159 patients have been randomized into Spectral's EUPHRATES trial.
• Announced the appointment of Dr. Gualtiero Guadagni as the Company's Vice President, Sales and Marketing. Dr. Guadagni will primarily be responsible for the development and expansion of commercial activities and market preparation plans for Toraymyxin and Spectral's Endotoxin Activity Assay (EAA™) in Canada, the United States and Europe.
• Closed a private placement for gross proceeds of $5.6 million.
• Concluded the reporting period with approximately $10.6 million in cash, cash equivalents and short-term investments.
• Subsequent to quarter end, disclosed that the trial's composite 28-day mortality rate was approximately 33 per cent for randomized patients. The composite mortality rate continues to suggest that the Company is enrolling patients who are most likely to benefit from Spectral's treatment.
"We made excellent progress with the trial's patient enrollment in the second quarter, which moves us closer to the study's planned, second interim analysis," stated Dr. Paul Walker, President and CEO of Spectral. "We are optimistic that the results from the second interim analysis should support the successful completion of the trial."
At the second interim analysis, the Data and Safety Monitoring Board will advise the Company on the trial's safety, efficacy or futility, with stopping rules in place for efficacy and futility.
A sample size recalculation will be done if necessary. Management intends to disclose the results of the interim analysis after 184 patients have been randomized and followed for 28 days, and the data from the analysis has been thoroughly reviewed.
Spectral remains on track to disclose information from the second interim analysis in late 2013 or early 2014.
Financial Review
Revenue for the three months ended June 30, 2013 was $572,000 compared to $599,000 for the same period in the preceding year. For the six months ended June 30, 2013 revenue was $1,280,000 compared to $1,275,000 for the same period in 2012.
It is anticipated that revenue in 2013 will remain consistent with levels achieved in 2012.
Total expenses for the three months ended June 30, 2013 were $3,642,000 compared to $2,798,000 in the second quarter of 2012. For the six months ended June 30, 2013, total expenses were $6,449,000 compared to $5,774,000 for the same period in 2012.
The increase of $675,000 for the six months ended June 30, 2013 is primarily attributable to higher EUPHRATES trial costs ($1,261,000) due to the accelerated patient enrollment rate, offset by a $475,000 reduction in management service fees.
The Company continues to maintain a low cost operating structure for its base business and expects no material increase in non clinical operating costs in 2013.
The Company concluded the second quarter of 2013 with cash, cash equivalents and short-term investment of $10,600,000 compared to $10,562,000 as at December 31, 2012.
