FREMONT, Calif., March 4 /PRNewswire-FirstCall/ -- Vermillion, Inc.
(NASDAQ:VRMLD), a molecular diagnostics company, today highlighted
recent accomplishments across its diagnostic test programs and
provided a preview of key business milestones it plans to achieve
over the course of 2008. The Company also released financial
results for the fourth quarter and year ended December 31, 2007.
"In 2007, Vermillion made significant clinical and commercial
advancements in our diagnostic programs for peripheral artery
disease (PAD), ovarian cancer and thrombotic thrombocytopenic
purpura (TTP)," said Gail Page, President and CEO of Vermillion.
"Our vision is to provide novel diagnostic tools to physicians in
an effort to improve patient diagnosis and care. We continue to
build awareness of the potential value proposition of our tests.
Our primary focus will be on commercialization pathways in 2008."
Recent Accomplishments Throughout the fourth quarter of 2007 and
into the first quarter of 2008, Vermillion has advanced its PAD and
ovarian cancer diagnostic programs, as well as accomplished
numerous achievements at the corporate level: PAD Diagnostic Test
Progress -- Completed a 540-patient clinical study evaluating the
ability of Vermillion's multi-marker panel to stratify individuals
into high and low risk groups for PAD. These results have been
accepted for publication in a peer-reviewed clinical journal and
are expected to be published in the first half of this year. --
Entered into an exclusive license agreement with Stanford
University to develop and commercialize a biomarker panel used to
assess the risk of PAD. Under the terms of the agreement,
Vermillion is granted exclusive rights to the biomarker panel.
Ovarian Cancer Diagnostic Test Progress -- Received the
distinguished Society for Gynecologic Oncologists' (SGO) Basic
Science Poster Award for its abstract, "Prospective independent
validation of a marker panel for distinguishing benign from
malignant pelvic masses." The abstract, which demonstrated that the
Company's Ovarian Tumor Triage Test correctly identified 84 percent
of ovarian cancer cases, compared to only 33 percent identified
using standard diagnosis methods without the test, was presented at
the SGO 38th Annual Meeting on Women's Cancer last year in San
Diego. -- Completed enrollment of 550 patients at 27 medical
centers in a clinical trial to evaluate Vermillion's Ovarian Tumor
Triage Test to differentiate women with ovarian cancer from women
with benign pelvic masses. -- Presented seven studies at the
European Society for Gynecologic Oncology meeting describing
advancements in Vermillion's ovarian cancer diagnostic program. --
Data showed that Vermillion's panel of ovarian cancer protein
biomarkers in combination with CA-125 could more accurately
identify early-stage ovarian cancer than could CA-125 alone. --
Data demonstrated that Vermillion's ovarian cancer biomarker panel
could accurately and with statistical significance predict women
with ovarian cancer who had good prognosis from those who did not.
The study used Kaplan-Meier analysis to show that women with a low
panel score were significantly more likely to survive than women
with high scores, independent of the stage of the disease.
Corporate Developments -- Renewed a long-standing collaboration
with Johns Hopkins University on the development of novel
biomarkers that can be applied toward disease detection,
classification and monitoring of prevalent cancers, including
ovarian, breast and prostate. Vermillion will have access to
exclusive commercial rights to the discoveries made through the
partnership. -- Vermillion's stockholders and board of directors
approved a 1 for 10 reverse stock split of the Company's common
stock. The reverse split became effective at the close of trading
on Monday, March 3, 2008. -- The Ohio State University commercially
launched Vermillion's diagnostic test for managing patients with
TTP, a hematological disease. The test helps physicians make the
correct diagnosis, initiate timely treatment, evaluate response to
therapy and predict the risk of recurrence in patients with TTP. --
Received issuance of U.S. Patent No. 7,297,556 for aiding diagnosis
of nephrotic syndrome, a kidney disorder marked by very high or low
levels of protein in the urine, which results in bodily swelling
and high cholesterol. 2008 Milestones The Company's primary goal
for 2008 will be to commercialize its diagnostic tests through
collaborations with Quest Diagnostics and other thought leaders in
oncology, cardiology and hematology. Vermillion expects to attain
the following milestones: -- Present data from three studies
highlighting progress in Vermillion's ovarian cancer diagnostic
program at the Society for Gynecologic Oncologists' (SGO) 2008
Annual Meeting on Women's Cancer held March 9-12 in Tampa, Florida.
-- Report top-line data from the ovarian tumor triage clinical
trial later this quarter and submit to the U.S. Food and Drug
Administration (FDA) for clearance as an in vitro diagnostic test
in the first half of 2008. -- Work with Quest Diagnostics to
integrate Vermillion's PAD proteomic biomarkers as a laboratory
developed test. -- Establish a clinical steering committee to guide
and provide advice on additional clinical studies to support
registration of the PAD test with the FDA and to further potential
market adoption. -- Continue to build the product pipeline by
partnering with collaborators to identify and in-license biomarkers
for future diagnostics. Fourth Quarter and Year-End 2007 Results As
a result of the November 13, 2006 sale of its former instrument
business to Bio-Rad Laboratories, the Company anticipates no major
revenue until its diagnostic tests are commercialized. Accordingly,
the Company had minimal revenue from service of $23,000 in the
fourth quarter of 2007 and $44,000 for the full year of 2007,
compared to $1.2 million and $18.2 million for the fourth quarter
of 2006 and full year of 2006, respectively. Total operating
expenses for the fourth quarter of 2007 were $4.9 million, compared
to $7.7 million in the same period last year. The decrease in
operating expenses was due to reductions in research and
development and general and administrative expenses, as well as the
elimination of selling and marketing expenses associated with the
Company's former instrument business. The net loss for the fourth
quarter of 2007 was $3.3 million, compared to $1.9 million for the
fourth quarter of 2006. Basic and diluted net loss per share for
the fourth quarter of 2007 was $0.52 per share based on 6.4 million
shares outstanding after the effect of the reverse stock split,
compared to a basic and diluted net loss per share of $0.49 per
share for the same period in 2006 adjusted for the retroactive
treatment of the reverse stock split. For the full year of 2007,
the net loss was $21.3 million or $4.47 per share, compared to a
net loss of $22.1 million or $6.05 per share in the same period in
2006. All earnings per share calculations are on a post reverse
stock split basis. Gain on the sale of the Company's instruments
business was $1.6 million in 2007 compared to $6.9 million in 2006.
At December 31, 2007, the Company's cash, short- and long-term
investments, totaled $20.4 million, compared to $17.7 million at
December 31, 2006. Net cash used in operating activities in the
fourth quarter of 2007 was $4.3 million. The Company continues to
prudently manage expenses and cash utilization. About Vermillion
Vermillion, Inc. is dedicated to the discovery, development and
commercialization of novel high-value diagnostic tests that help
physicians diagnose, treat and improve outcomes for patients.
Vermillion, along with its prestigious scientific collaborators,
has diagnostic programs in oncology, hematology, cardiology and
women's health. Vermillion is based in Fremont, California.
Additional information about Vermillion can be found on the Web at
http://www.vermillion.com/. Forward Looking Statements This news
release contains forward-looking statements that involve
significant risks and uncertainties, including statements regarding
Vermillion's plans, objectives, expectations and intentions. These
forward-looking statements are based on Vermillion's current
expectations. The Private Securities Litigation Reform Act of 1995
provides a "safe harbor" for such forward-looking statements. In
order to comply with the terms of the safe harbor, Vermillion notes
that a variety of factors could cause actual results and experience
to differ materially from the anticipated results or other
expectations expressed in such forward-looking statements. There
are no guarantees that Vermillion will succeed in its efforts to
commercialize its diagnostic tests in 2008 or during any other
period of time. Factors that could cause actual results to
materially differ include but are not limited to: (1) uncertainty
in obtaining intellectual property protection for inventions made
by Vermillion; (2) unproven ability of Vermillion to discover,
develop, and commercialize diagnostic products based on findings
from its disease association studies; (3) unproven ability of
Vermillion to discover or identify new protein biomarkers and use
such information to develop ovarian cancer diagnostic products; (4)
uncertainty as to whether Vermillion will be able to obtain any
required regulatory approval of its diagnostic products; (5)
uncertainty of market acceptance of its products, including the
risk that its products will not be competitive with products
offered by other companies, or that users will not be entitled to
receive adequate reimbursement for its products from third party
payors such as private insurance companies and government insurance
plans; and (6) other factors that might be described from time to
time in Vermillion's filings with the Securities and Exchange
Commission. All information in this press release is as of the date
of the release, and Vermillion expressly disclaims any obligation
or undertaking to release publicly any updates or revisions to any
such statements to reflect any change in Vermillion's expectations
or any change in events, conditions or circumstances on which any
such statement is based, unless required by law. ~financial
statements follow~ Vermillion, Inc. and Subsidiaries Condensed
Consolidated Balance Sheets (In Thousands) (Unaudited) December 31,
2007 2006 (1) Assets Current assets: Cash and cash equivalents
$7,617 $17,711 Short-term investments, at fair value 9,875 -
Accounts receivable, net of allowance for doubtful accounts of $-
and $2, respectively 19 29 Prepaid expenses and other current
assets 1,064 2,300 Total current assets 18,575 20,040 Property,
plant and equipment, net 1,938 2,260 Long-term investments, at fair
value 2,902 - Other assets 638 716 Total assets $24,053 $23,016
Liabilities and Stockholders' Deficit Current liabilities: Accounts
payable $2,975 $2,401 Accrued liabilities 3,595 4,645 Current
portion of convertible senior notes, net of discounts 2,471 - Total
current liabilities 9,041 7,046 Long-term debt owed to related
party 10,000 7,083 Convertible senior notes, net of discount 16,196
18,428 Other liabilities 278 360 Total liabilities 35,515 32,917
Stockholders' deficit: Common stock 6 39 Additional paid-in capital
227,895 207,991 Accumulated deficit (239,142) (217,860) Accumulated
other comprehensive loss (221) (71) Total stockholders' deficit
(11,462) (9,901) Total liabilities and stockholders' deficit
$24,053 $23,016 (1) The condensed consolidated balance sheet at
December 31, 2006 has been derived from the audited consolidated
financial statements at that date included in the Company's Form
10-K for the fiscal year ended December 31, 2006 Vermillion, Inc.
and Subsidiaries Condensed Consolidated Statements of Operations
(In Thousands, Except Per Share Amounts) (Unaudited) Three Months
Ended Year Ended December 31, December 31, 2007 2006 2007 2006
Revenue $23 $1,216 $44 $18,215 Cost of revenue 13 506 28 9,338
Gross profit 10 710 16 8,877 Operating expenses: Research and
development 1,916 2,693 8,213 11,474 Sales and marketing 735 1,916
2,175 12,568 General and administrative 2,232 3,112 10,858 10,661
Total operating expenses 4,883 7,721 21,246 34,703 Gain on sale of
instrument business 1,992 6,929 1,610 6,929 Loss from operations
(2,881) (82) (19,620) (18,897) Loss on extinguishment of debt -
(1,481) - (1,481) Interest and other expense, net (247) (326)
(1,499) (1,536) Loss before income taxes (3,128) (1,889) (21,119)
(21,914) Income tax benefit (expense) (164) 38 (163) (152) Net loss
$(3,292) $(1,851) $(21,282) $(22,066) Loss per share - basic and
diluted (1) $(0.52) $(0.49) $(4.47) $(6.05) Shares used to compute
basic and diluted loss per common share (1) 6,379 3,772 4,765 3,646
(1) Adjusted for March 4, 2008, 1 for 10 reverse stock split.
DATASOURCE: Vermillion, Inc. CONTACT: Investors, Sue Carruthers of
Vermillion, Inc., +1-510-505-2233; or Media, Daryl Messinger of
WeissComm Partners, +1-415-946-1062, for Vermillion, Inc. Web site:
http://www.vermillion.com/
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