United
States Securities And Exchange Commission
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): February 18, 2015 |
|
ISORAY, INC.
(Exact name of registrant as specified in
its charter) |
|
Minnesota
(State or other jurisdiction
of incorporation) |
001-33407
(Commission
File Number) |
41-1458152
(IRS Employer
Identification No.) |
350 Hills Street, Suite 106, Richland,
Washington 99354
(Address of principal
executive offices) (Zip Code)
(509) 375-1202
(Registrant's telephone number)
Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the
Securities Act |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the
Exchange Act |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b)
under the Exchange Act |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c)
under the Exchange Act |
| Item 2.02. | Results of Operations
and Financial Condition |
On
February 18, 2015, IsoRay, Inc. (the "Company") issued a press release announcing
its financial results for the quarter and six months ended December 31, 2014, the text of which is attached hereto as Exhibit 99.1.
The information in
this Current Report on Form 8-K, including the exhibit, is furnished pursuant to Item 2.02 and shall not be deemed “filed”
for the purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in
any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.
In addition to historic
information, this report, including the exhibit, contains forward-looking statements regarding events, performance and financial
trends. Various factors could affect future results and could cause actual results to differ materially from those expressed in
or implied by the forward-looking statements. Some of those factors are identified in the Company’s periodic reports filed
with the Securities and Exchange Commission, the most recent of which are the Company’s Annual Report on Form 10-K for the
year ended June 30, 2014 and the Company's Quarterly Report on Form 10-Q for the quarter ended December 31, 2014.
| Item 9.01. | Financial Statements
and Exhibits |
Exhibit |
|
Description |
99.1 |
|
Press release issued by IsoRay, Inc., dated February 18, 2015. |
SIGNATURES
Pursuant to the requirements
of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.
Dated: February
18, 2015
|
IsoRay, Inc., a Minnesota corporation |
|
|
|
|
By: |
/s/ Dwight Babcock |
|
|
Dwight Babcock, CEO |
Exhibit 99.1
FOR IMMEDIATE RELEASE
ISORAY, INC. REPORTS SECOND QUARTER RESULTS
Published Reports Confirm Cesium-131
is a True Success in Treating Cancer
RICHLAND, Washington (February 18, 2015) – IsoRay, Inc.
(NYSE MKT: ISR), a medical technology company and innovator in seed brachytherapy and medical radioisotope applications for the
treatment of prostate, brain, lung, head and neck and gynecological cancers, announced its financial results for the quarter and
six months ended December 31, 2014. With over $20,000,000 of cash on hand and no debt, IsoRay is positioned to be a dominant player
in the brachytherapy cancer treatment market.
IsoRay’s team remains focused in diversifying its product
offerings through institutional based studies designed to address various aggressive cancers that to date often fail current standard
of care options. Management is hopeful that the lingering decline in the prostate market may be bottoming out. Management anticipates
seeing modest gains in IsoRay’s market share as well as some revenue growth in the coming quarters. We experienced a negative
impact on our international sales efforts during the quarter ended December 31, 2014, with the devaluation of the Euro causing
our products to become higher in price, making it more difficult to attract new adopters in this market.
Management
is very pleased with the release of the third peer-reviewed publication supporting the use and success of Cesium-131 for prostate
cancer. This follows on the heels of two other publications reporting significant success in treating metastatic brain cancers
and gynecological cancers. The most recent report, by the University of Pittsburg Medical Center (UPMC), covers a 9 year effort
to date on using Cesium-131 for the treatment of low and intermediate prostate cancer. The conclusion was: Cesium-131
seed brachytherapy offers extremely high efficacy compared to other isotopes or treatment modalities used in treating prostate
cancer, with the advantage of rapid return to pre-treatment urinary function and at lower cost.
Brachytherapy treatments are now being discussed with greater
frequency as evidenced by several new publications supporting brachytherapy as a financially prudent treatment as well as highly
effective cancer treatment. Brachytherapy offers some of the best results for the patient, fewer and less severe side effects,
faster recovery back to base line and at the lowest industry cost. This is further supported by the recent article published in
the International Journal of Radiation Oncology, authored by physicians at Stanford University, titled “The Case
for Prostate Brachytherapy in the Affordable Care Act Era” http://www.redjournal.org/article/S0360-3016(14)04265-5/pdf.
This article concluded: in low risk prostate cancer, brachytherapy demonstrates the opportunity to benefit patients, payers
and institutions, and radiation oncologists should be proactive in the reintroduction and expansion of brachytherapy for prostate
cancer.
In another recent publication in the Journal of Clinical
Oncology titled “Where Have You Gone Brachytherapy” http://hwmaint.jco.ascopubs.org/cgi/content/full/JCO.2014.59.8128v1,
the authors cite a study by Dr. Steven J. Frank, et al. that concluded “there is no greater value for the treatment
of localized prostate cancer than brachytherapy”. While IsoRay remains committed to the expanding its presence in the
prostate market, management will continue its strategic focus to promote the use of Cesium-131 to combat cancers in numerous other
body sites. We are extremely pleased with the effectiveness of Cesium-131 as a treatment solution for brain cancer, head and neck
cancer, lung cancer, prostate cancer and gynecological cancers while providing far better quality of life for the patient than
other alternatives.
Management is seeing a growing awareness of Cesium-131 as more
abstracts, posters and now medical journals report significant success stories using Cesium-131 in treating metastatic brain, gynecological
and prostate cancer. These published peer reviewed studies have created a rise in leading medical institutions preparing to duplicate
these study results independently and/or participate in an existing multi-institutional study. Outstanding medical centers continue
to perform Cesium-131 cases following reports by Weill Cornell, University of Kentucky and UPMC of their experiences with Cesium-131.
Some notable names now utilizing Cesium-131 in treating tumors in various body sites include Massachusetts General Hospital, Johns
Hopkins, Harvard Affiliate Brigham and Women’s, Princeton, New York Presbyterian, Rutgers Medical School and Barrow Neurological
Institute.
With the anticipated addition of new studies being launched
and the expectation of other study results being made public through future peer reviewed publications, management expects awareness
of Cesium-131 to grow within the medical community.
IsoRay continues to invest in R&D data protocols geared
to showing improved efficacy over current cancer treatments while providing the patient with an improved quality of life experience.
Several new studies are expected to launch in the near future in various body sites. These will likely include focal treatment
for prostate cancer, a head and neck cancer study and a GliaSite balloon catheter brain cancer treatment utilizing Cesitrex, our
liquid form of Cesium-131. IsoRay Chairman and CEO Dwight Babcock commented, “Clinical evidence provided through protocols
performed by major medical centers that prove utilizing Cesium-131 is either equal to or better than the current standard of care
alternatives, with patients enjoying an improved quality of life, remains the key to IsoRay’s success. These studies also
aid in generating awareness and ultimately general adoption by community hospitals and physicians, which will in turn drive consumers
to our product offerings. To this end IsoRay is totally committed and given this growing acceptance and interest in our now published
results, we remain committed to our strategic sales and marketing objectives, which we believe will contribute to long term growth
and achieving profitability."
IsoRay, Inc. and Subsidiaries
Consolidated Statements of Operations
(Unaudited)
| |
For the three | | |
For the six | |
| |
months ended | | |
months ended | |
| |
December 31, | | |
December 31, | |
| |
2014 | | |
2013 | | |
2014 | | |
2013 | |
Product sales, net | |
$ | 1,065,585 | | |
$ | 1,085,408 | | |
$ | 2,107,686 | | |
$ | 2,135,323 | |
Cost of product sales | |
| 1,103,549 | | |
| 1,119,314 | | |
| 2,200,452 | | |
| 2,246,537 | |
| |
| | | |
| | | |
| | | |
| | |
Gross loss | |
| (37,964 | ) | |
| (33,906 | ) | |
| (92,766 | ) | |
| (111,214 | ) |
| |
| | | |
| | | |
| | | |
| | |
Operating expenses: | |
| | | |
| | | |
| | | |
| | |
Research and development expenses | |
| 140,627 | | |
| 170,030 | | |
| 317,237 | | |
| 317,020 | |
Sales and marketing expenses | |
| 303,783 | | |
| 326,467 | | |
| 657,526 | | |
| 685,652 | |
General and administrative expenses | |
| 537,940 | | |
| 513,964 | | |
| 1,113,891 | | |
| 1,165,000 | |
| |
| | | |
| | | |
| | | |
| | |
Total operating expenses | |
| 982,350 | | |
| 1,010,461 | | |
| 2,088,654 | | |
| 2,167,672 | |
| |
| | | |
| | | |
| | | |
| | |
Operating loss | |
| (1,020,314 | ) | |
| (1,044,367 | ) | |
| (2,181,420 | ) | |
| (2,278,886 | ) |
| |
| | | |
| | | |
| | | |
| | |
Non-operating income (expense): | |
| | | |
| | | |
| | | |
| | |
Interest income | |
| 72,360 | | |
| 481 | | |
| 145,055 | | |
| 835 | |
Change in fair value of warrant
derivative liability | |
| 41,000 | | |
| 117,000 | | |
| 347,000 | | |
| 81,000 | |
Financing and interest expense | |
| - | | |
| (86 | ) | |
| (3,451 | ) | |
| (827 | ) |
| |
| | | |
| | | |
| | | |
| | |
Non-operating income (expense), net | |
| 113,360 | | |
| 117,395 | | |
| 488,604 | | |
| 81,008 | |
| |
| | | |
| | | |
| | | |
| | |
Net loss | |
| (906,954 | ) | |
| (926,972 | ) | |
| (1,692,816 | ) | |
| (2,197,878 | ) |
Preferred stock deemed dividends (Note 10) | |
| - | | |
| - | | |
| - | | |
| (726,378 | ) |
Preferred stock dividends | |
| (2,658 | ) | |
| (2,658 | ) | |
| (5,316 | ) | |
| (5,316 | ) |
| |
| | | |
| | | |
| | | |
| | |
Net loss applicable to common shareholders | |
$ | (909,612 | ) | |
$ | (929,630 | ) | |
| (1,698,132 | ) | |
| (2,929,572 | ) |
| |
| | | |
| | | |
| | | |
| | |
Basic and diluted loss per share | |
$ | (0.02 | ) | |
$ | (0.02 | ) | |
$ | (0.03 | ) | |
$ | (0.08 | ) |
| |
| | | |
| | | |
| | | |
| | |
Weighted average shares used in computing net | |
| | | |
| | | |
| | | |
| | |
loss per share: | |
| | | |
| | | |
| | | |
| | |
Basic and diluted | |
| 54,883,445 | | |
| 38,419,502 | | |
| 54,875,749 | | |
| 37,133,875 | |
The accompanying notes are an integral part
of these financial statements
###
About IsoRay
IsoRay, Inc., through its subsidiary, IsoRay Medical, Inc.
is the sole producer of Cesium-131 brachytherapy seeds, which is expanding brachytherapy options throughout the body. Learn
more about this innovative Richland, Washington company and explore the many benefits and uses of GliaSite® and Cesium-131
by visiting www.isoray.com. Join us on Facebook/Isoray. Follow us on Twitter@Isoray.
Contact:
IsoRay Medical
(509) 375-1202
info@Isoray.com
OR
Worldwide Financial
(954) 360-9998
Info@wwfinancial.com
Safe Harbor Statement
Statements in this news release about IsoRay’s future
expectations, including: the advantages of our products and their delivery systems, future demand for IsoRay’s existing and
planned products, whether revenue and other financial metrics will improve in future periods, whether IsoRay will be able to continue
to expand its base beyond prostate cancer, whether sales of our products will continue at historic levels or increase, whether
the use of our products will increase or continue, whether additional medical centers will begin using our products, whether additional
studies will be published or presented with favorable outcomes from treatment with our products, whether we will continue to receive
support from industry leaders, whether awareness of our products in the medical community will continue or increase, whether future
studies of treatment of various cancers using our products will have favorable results, and all other statements in this release,
other than historical facts, are “forward-looking statements” within the meaning of the Private Securities Litigation
Reform Act of 1995 (“PSLRA”). This statement is included for the express purpose of availing IsoRay, Inc. of the protections
of the safe harbor provisions of the PSLRA. It is important to note that actual results and ultimate corporate actions could
differ materially from those in such forward-looking statements based on such factors as physician acceptance, training and use
of IsoRay’s products, changing levels of demand for IsoRay’s current and proposed future products, IsoRay’s ability
to reduce or maintain expenses while increasing sales, patient results achieved using our products in both the short and long term,
success of future research and development activities, patient results achieved when Cesium-131 is used for the treatment of cancers
and malignant diseases beyond prostate cancer, IsoRay’s ability to successfully manufacture, market and sell its products,
IsoRay’s ability to manufacture its products in sufficient quantities to meet demand within required delivery time periods
while meeting its quality control standards, the success of our sales and marketing efforts, IsoRay’s ability to enforce
its intellectual property rights, changes in reimbursement rates, changes in laws and regulations applicable to our products, whether
additional studies and protocols are released and support the conclusions of past studies and protocols, whether ongoing patient
results with our products are favorable and in line with the conclusions of clinical studies and initial patient results, whether
we, our distributors and our customers will successfully obtain and maintain all required regulatory approvals and licenses to
market, sell and use our products in their various forms, continued compliance with ISO standards as audited by BSI, and other
risks detailed from time to time in IsoRay’s reports filed with the SEC.
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