Diaxonhit Reports 2012 Results
Exonhit 2012 Highlights
- Recruitment completed for AclarusDx ™clinical studies
- Two new collaborations within consortia to develop companion diagnostics in breast cancer and chemo- and radio-resistant cancers
- Launch of DX15 development program in thyroid cancer
Birth of Diaxonhit
- Acquisition of InGen BioSciences by Exonhit and creation of a new integrated player in in vitro diagnostics (IVD) by the name of Diaxonhit
- Pro forma 2012 revenues at € 28.6 million
2012 Financial Highlights
- Augmented scope of consolidation including InGen BioSciences
- Reduction of losses
- Capital increases in cash for a total amount of € 6.5 million
- Approximately € 10 million in cash at December 31, 2012
- Integration of InGen BioSciences
- Continued development of proprietary products
- Extension of the marketed products portfolio
- Maintain external growth strategy
PARIS--(BUSINESS WIRE)-- The Management Board of Diaxonhit (Paris:ALEHT) (NYSE Alternext: ALEHT), the leading French provider of specialty diagnostic solutions, met on March 25, 2013 to close the consolidated financial accounts for the year ending on December 31, 2012. These accounts were verified by the Supervisory Board 1.
Commenting on these results, Loïc Maurel, MD, President of the Management Board of Diaxonhit, said: "2012 is a milestone in the life and size of Diaxonhit. The acquisition of InGen BioSciences, undertaken with the support of our shareholders, led to the creation of an integrated Group in the field of diagnostics. More than a simple addition, the merger of both companies provides the Group with the powerful development tool needed to allow ambitious growth in the coming years. We are excited about these new prospects for Diaxonhit, with the goal of ultimately becoming a profitable biotechnology company".
|Total operating expenses||11.4||13.1|
|Cash burn from operations*||(4.4)||(6.0)|
|Consolidated cash and cash equivalent at Dec. 31||9.8||12.9|
*including R&D tax credit
KEY FINANCIAL HIGHLIGHTS
New scope of consolidation
On December 14, 2012, after approval by Exonhit's Shareholders General Meeting, the Diaxonhit Group was formed through the merger of Exonhit and Ingen Biosciences (IBS). Diaxonhit consolidated accounts as of December 31, 2012 were prepared on the basis of this new corporate structure.
In terms of balance sheet, IBS was integrated with Diaxonhit on December 14, 2012. The acquisition generated the recognition of a goodwill of € 16.9 million, representing the difference between the acquisition cost and the book value of IBS assets and liabilities at the acquisition date. This goodwill, calculated on an interim basis in 2012, might be reduced in 2013 after further standard analysis in order to assess the market value of IBS assets and liabilities. This goodwill is amortized on a straight-line basis over a period of 10 years. The acquisition cost is in line with market practice.
For the income statement, income and expenses incurred by IBS between December 15 and December 31, 2012 were added to income and expenses incurred by Diaxonhit during the full year 2012. Amortization of the goodwill for the period from December 15 to December 31, 2012 was also added to the expenses for the year.
Reduction of losses
In 2012, Diaxonhit recorded revenues for a total amount of € 5.4 million, of which € 4.4 million relate primarily to R&D fees received through the partnership with Allergan, and € 0.7 million relates to product sales recorded by IBS between December 15 and December 31, 2012.
Operating expenses were reduced by € 1.7 million (-13%) to € 11.4 million, mainly due to:
- a decrease in R&D expenses following the closure of Diaxonhit's U.S. laboratories in 2011, and
- a reduction in sales and marketing expenses related to investments in communication around AclarusDx ™ that were made in 2011 and not renewed in 2012.
Operating loss is reduced to € 6.5 million in 2012 compared to € 8.1 million in 2011.
Including financial results of € -0.2 million and an R&D tax credit of € 0.9 million, Diaxonhit recorded a net loss of € 5.8 million for 2012, an 18% decrease compared to the loss of € 7.1 million recorded in 2011.
2012 pro forma revenues of € 28.6 million
If the acquisition of IBS had occurred on January 1, 2012, Diaxonhit would have recorded total revenues of € 28.6 million in 2012.
For the same year, a stand-alone Exonhit would have posted a net loss of € 5.7 million and IBS a net gain of € 1.1 million. Given the amortization of goodwill, € 1.7 million over the full year, pro forma net loss of the Group would have amounted to €6.3 million in 2012.
€ 6.5 million raised in 2012
During the year 2012, Diaxonhit completed three capital increases in cash for a total amount of € 6.5 million:
- a placement reserved to private investors under the TEPA Act for an amount of approximately € 0.5 million, after exercise of the over-allotment option, and
- two private placements with institutional investors for € 4.3 million and € 1.7 million in order to partially fund the cash portion of the purchase price of IBS.
Given other capital increases carried out during the year, in particular the issuance of new shares to IBS shareholders in connection with the acquisition, 21,257,468 new shares were issued. This increased the outstanding number of common shares to 55,376,765 as of December 31, 2012.
A cash position of almost € 10 million at December 31, 2012, after acquisition of IBS
At the end of 2011, Diaxonhit had € 12.9 million in cash and cash equivalents. Following a reduction in operating cash flow (€ 4.4 million for the year), funds received as grants or through capital increases, the amount of € 8 million paid in cash for the acquisition of IBS, and IBS cash position on December 14, 2012 for a total of € 5.6 million, the Group's cash position as of December 31, 2012 amounts to € 9.8 million.
In addition, on December 14, 2012 Diaxonhit Shareholders General Meeting approved the establishment of a funding program "PACEO2" with Société Générale for an amount of approximately € 6.5 million. The first tranche was drawn during the month of January 2013 for a net amount of € 0.4 million.
With the addition of this program, Diaxonhit has approximately 24 months of cash resources on the basis of its current cash burn rate.
Marketing: Diaxonhit, the French leader for HLA
Since its merger with IBS, Diaxonhit has expanded its scope of business to the commercialization of specialty in vitro diagnostic products and related advanced equipment.
The group's product offering now covers transplantation, infectious diseases and autoimmunity, product quality control and rapid tests, including Tetanus Quick Stick ®, its proprietary product used in emergency wards for the assessment of patients' immune protection against tetanus.
In the field of transplantation, Diaxonhit is the market leader in France of HLA (Human Leukocyte Antigen) tests that are used for assessing the compatibility between donors and recipients for organ and bone marrow transplants. These diagnostic tests are distributed exclusively for One Lambda, the world leader in HLA tests and a subsidiary of Thermo Fisher Scientific. Diaxonhit is currently its leading distributor in terms of sales outside the United States.
Strengthened R&D capabilities
The acquisition of IBS also strengthened Diaxonhit's research and development activities through an increase in its expertise and know-how. This activity is characterized by in-house developments in neurodegenerative diseases, cancer and infectious diseases, and developments undertaken within consortia or collaborative agreements with pharmaceutical companies, biotechnology companies and research institutes.
Diaxonhit's portfolio of proprietary products includes the three following diagnostic tests:
- AclarusDx™, a blood test for Alzheimer's disease that is currently being introduced in French memory centers in the context of a clinical observational real life study whose goal is to finalize the positioning of this test within the current diagnosis process. Study enrollment is completed, and the first results should be available by the end of 2013. A pilot study of the test is also underway in the United States to assess the potential of this market.
- DX15, a tissue test for thyroid cancer, whose goal is to identify from a sample collected by fine needle aspiration, whether a thyroid nodule is benign or malignant when cytology is indeterminate. After validation of the clinical need and positioning of the test by experts, a pilot feasibility study was successfully completed. The study for signature identification is currently starting.
- Inoplex™, a test for the serological detection of staphylococcus infections related to hip or knee replacement. The first generation of this test has already obtained the CE mark. A second generation, that covers a wider range of bacteria involved in these infections, is currently being developed as part of a clinical validation study.
Moreover, in 2012 Diaxonhit was selected to participate in two collaborative projects to develop companion diagnostics in cancer:
- RESPONSIFY, a European consortium of 12 partners whose objective is to identify biomarkers of response to two common chemotherapeutic treatments of breast cancer, anti-HER2 (Herceptin) and anti-angiogenic (Avastin) therapies, and develop in vitro diagnostic tests for use in clinical practice. The company received a grant from the European Commission for a total of €418 K;
- TEDAC, a consortium gathered around Erytech Pharma and Diaxonhit, AP-HP (Department of Pathology, Beaujon Hospital), Inserm and Paris-Diderot University. It aims to develop innovative therapies for the treatment of chemo- or radio-resistant cancers, and tools enabling personalized care of patients. Diaxonhit is entitled to receive a total funding of € 2.9 million spread over several years as part of this project endorsed by the Competitiveness Cluster LyonBiopôle.
Integration of IBS: a strong development tool
During the first half of 2013, Diaxonhit should finalize the integration of IBS. Beyond expected cost reductions resulting from the consolidation of R&D activities and sharing of general resources, this integration will provide strong business leverage. The current size of the Group is a key factor in building credibility with partners to enter into new distribution contracts or new license agreements.
An ambition: to build an in vitro diagnostics European leader
Diaxonhit's development strategy, whose objectives include the Group's transformation into a profitable biotechnology company, focuses on two axes.
On the one hand, Diaxonhit intends to pursue implementation of its organic growth, driven by advances in the development of its proprietary products to be commercialized by its own sales force, and the signing of new partnerships for the commercialization of innovative in vitro diagnostic products. The award last February by the French Blood Bank of four national public tenders to its marketing affiliate, InGen, is an initial step in that direction.
In parallel, the Group expects to benefit from the consolidation trend currently underway in the field of in vitro diagnostics, and accelerate its development through external growth.
(1) All financial statements were audited by the auditors and their report will be issued after review of the 2012 management report.
(2) Equity line
A meeting for institutional investors, analysts and journalists is held by Diaxonhit's management team today, Tuesday, March 26, 2012 at 8:30 CET.
2013 Financial Calendar
Shareholders Annual General Meeting: June 20, 2012
Diaxonhit (NYSE Alternext, FR0004054427, ALEHT) is a French fully integrated leader in the in-vitro diagnostic field, involved from research to commercialization of specialty diagnostic products.
With many partnerships and a strong presence in hospitals, Diaxonhit has an extensive commercialization network. Through its affiliate, InGen, it commercializes and services, mostly under exclusivity agreements, in-vitro diagnostic kits and advanced equipment. It operates mainly in the fields of transplantation, infectious diseases and autoimmunity, product quality control and rapid tests, including Tetanus Quick Stick ®, a proprietary product.
The group also owns a diversified portfolio of products in development, including both innovative molecular and non-molecular diagnostics, covering three main specialty areas: immuno-infection, Alzheimer's disease and cancer.
Diaxonhit headquarters are located in Paris and its affiliate in the Paris region. The Group is listed on NYSE Alternext in Paris and is part of the NYSE Alternext OSEO innovation index.
For more information, please visit: http://www.diaxonhit.com.
This press release contains elements that are not historical facts including, without limitation, certain statements about future expectations and other forward-looking statements. Such statements are based on management's current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those anticipated.
In addition, Diaxonhit, its shareholders, and its affiliates, directors, officers, advisors and employees have not verified the accuracy of, and make no representations or warranties in relation to, statistical data or predictions contained in this press release that were taken or derived from third party sources or industry publications, and such statistical data and predictions are used in this press release for information purposes only.
Finally, this press release may be drafted in the French and English languages. In an event of differences between the texts, the French language version shall prevail.
CONSOLIDATED INCOME STATEMENT
(in thousands of euros, except per share data)
December 31, 2012
December 31, 2011
|Sales of in vitro diagnostic products||691|
|Research and Development revenues||4,375||4,978|
|Research & Development grants||305||4|
|Cost of goods sold||(449)|
|Research and Development expenses||(6,963)||(7,717)|
|Marketing and Sales expenses||(898)||(1,508)|
|General and Administrative expenses||(3,531)||(3,863)|
|Total operating expenses||
|Loss from operations||
|Currency exchange gain (loss) - net||(184)||227|
|Financial income (loss)||(168)||384|
|Income (loss) before tax||(6,643)||(8,202)|
|Net income (loss)||(5,770)||(7,099)|
|Weighted average number of shares outstanding||35,941,997||33,670,511|
|Net loss per share||(0.16)||(0.21)|
|Net loss per share (diluted)||(0.16)||(0.21)|
CONSOLIDATED BALANCE SHEET
(in thousands of euros)
|ASSETS||December 31, 2012||December 31, 2011|
|Intangible assets, net||599||6|
|Property and equipment, net||1,223||655|
|Other long term assets||440||379|
|Total long-term assets||19,112||1,040|
|Accounts and grants receivable||4,108||1,031|
|Other short term assets||5,472||2,607|
|Cash and cash equivalents||9,802||12,925|
|Total short-term assets||19,382||16,563|
|LIABILITIES AND SHAREHOLDERS' EQUITY|
|Additional paid-in capital||102,590||96,783|
|Provisions for risks||569||632|
|Long-term debt less current portion||1,867||-|
|Long-term capital lease obligations less current portion||131|
|Long-term portion of deferred income||126||-|
|Total long-term liabilities||2,125||-|
|Current portion of long-term debt||444||-|
|Current portion of capital lease obligations||237||15|
|Deferred income short-term||1,456||1,022|
|Total short-term liabilities||11,299||3,404|
|TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY||38,494||17,603|
CONSOLIDATED CASH FLOW STATEMENT
|(in thousands of euros)||
Dec 31, 2012
Dec 31, 2011
|Depreciation and amortization of property & equipment||268||638|
|Depreciation of intangible assets||16||128|
|Amortization of goodwill||71||-|
|Net book value of impaired assets||8||29|
|Retirement liability accrual and other||(296)||352|
|Reversal of accruals/ Convertible bonds reimbursement premium||-||(1,254)|
|Capitalized interests on convertible bonds||-||1,339|
|Increase (decrease) in cash from:|
|Research tax credit receivable||423||226|
|Prepaid expenses and other assets||(776)||(122)|
|Accounts payable and accrued expenses||1,832||4|
|Deferred income, short term||(146)||(164)|
|Deferred income, long term||-||-|
|Net cash used in operations||(4,447)||(6,023)|
|Purchase of property and equipment||(87)||(149)|
|Payment of patent and acquisition of other intangibles||-||77|
|Acquisition of shares in subsidiaries (net of cash acquired) (a)||(5,659)||-|
|Net cash used in investing activities||(5,746)||(72)|
|Issuance of shares (net of fees)||5,943||1,364|
|Reimbursement of convertible bonds||-||(7,968)|
|Loan - redeemable advances||646||-|
|Reimbursement of loans and lease obligations||(27)||(66)|
|Grants - deferred income, short term||475||-|
|Grants - deferred income, long term||86||-|
|Net cash provided by (used in) financing activities||7,123||(6,670)|
|Net increase (decrease) in cash and cash equivalents||(3,070)||(12,765)|
|Effects of currency exchange rate on cash||(52)||84|
|Cash and cash equivalents, beginning of period||12,925||25,607|
|Cash and cash equivalents, end of period||9,802||12,925|
(a) Equal to : amount of capital increase approved at the December 14, 2012 Extraordinary General Meeting (+€10.0 million), minus acquisition costs (equity investment and acquisition related costs for a total of -€19.635 million), less payment of dividends to the sellers on the acquisition date (-€1.592 million), and plus the amount of InGen Biosciences Group's cash on the day of acquisition (+€5.569 million).
Hervé Duchesne de Lamotte, +33 1 53 94 52 49
+ 33 1 56 88 11 11
Alexandre Commerot, email@example.com
Jennifer Jullia, firstname.lastname@example.org
KEYWORDS: Europe France
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