- Major ColorectAlert(TM) study with U.S. National Cancer Institute
- 25,000-participant PREPARE study underway in life insurance
testing market - Expanded scientific validation for PREVU(x) -
Positioned to receive milestone payments later this year TORONTO,
Aug. 10 /PRNewswire-FirstCall/ -- Predictive medicine company IMI
International Medical Innovations Inc. (TSX: IMI; Amex: IME) today
announced financial results for the second quarter of fiscal 2005
ended June 30, 2005 and provided an update on operating activities.
"We have realized a number of important achievements in the first
half of 2005 that will contribute significantly to the long-term
value of the company," said Dr. Brent Norton, President and Chief
Executive Officer. "We have started the 25,000-participant PREPARE
(PREVU(x) Predicts Atherosclerosis Risk and Events) clinical trial
in the life insurance testing industry for PREVU(x) LT (Lab Test)
Skin Sterol Test, the lab-processed format of the technology --- a
study that includes LabOne and, most recently, Allstate Life
Insurance Company. Interim results from PREPARE, along with data
from other studies, will create near-term revenue opportunities and
may lead to regulatory applications in Canada and Europe as well as
milestone payments as early as later this year. We are also
continuing to generate compelling skin sterol data, with four
scientific publications and three presentations to date in 2005,
and more expected in the second half of the year." Dr. Norton
added, "Our cancer portfolio is likewise advancing, with a major
study with ColorectAlert(TM) sponsored by the U.S. National Cancer
Institute's Early Detection Research Network (EDRN). The EDRN study
will add significant credibility to our cancer platform and raise
awareness of our technology among key thought leaders. Most
importantly, pending favorable data we anticipate this study will
help pave the way for regulatory approval of ColorectAlert(TM). We
also have a pivotal study underway for our breast cancer test,
which is expected to be completed by the end of the year." PREVU(x)
Commercialization Update Total revenue for the quarter amounted to
$411,000, reflecting $333,000 in sales of product to McNeil
Consumer Healthcare and license revenue of $78,000. McNeil has
completed its first sales of PREVU(x) Point of Care (POC) Skin
Sterol Test. McNeil is actively promoting PREVU(x) POC through
medical conferences in major world markets, including the upcoming
annual meetings for the European Society of Cardiology, Canadian
Cardiovascular Society and American Heart Association. McNeil is
also targeting specific health care programs and providers, with a
number of training initiatives for operators underway to support
planned programs in Europe, Canada and the U.S. with PREVU(x) POC.
These programs are aimed primarily at clinics where cardiovascular
risk assessment is conducted. Additionally, McNeil expects to work
with certain national retailers in select markets to establish
in-store PREVU(x) POC clinics, possibly starting in fall 2005.
McNeil also continues to meet with life insurance companies to
prepare for the upcoming launch of PREVU(x) LT and will be
attending the upcoming Association of Home Office Underwriters
conference to raise market awareness of PREVU(x) LT. Recent
Operational Highlights Increased visibility of PREVU(x) with
presentation of new clinical data - Data presented at the 6th
Annual Conference on Arteriosclerosis, Thrombosis and Vascular
Biology showed that patients with elevated skin sterol and a high
Framingham global risk score have a significantly higher risk of
multi-vessel disease (a narrowing or blockage in two or more
coronary arteries, which provide the heart muscle with blood rich
in oxygen). - Data published in the July 2005 issue of the journal
Atherosclerosis showed that skin sterol is at least as predictive
of the presence of coronary calcium as traditional risk factors,
including serum (blood) lipid measures. Deposits of calcium in the
coronary arteries indicate a narrowing or blockage. - Data
presented in July at the American Association for Clinical
Chemistry (AACC) Annual Meeting showed that PREVU(x) LT can
effectively measure skin sterol on the palm of the hand and that
results from PREVU(x) LT and PREVU(x) POC are comparable. - Data
published in the August 2005 issue of Atherosclerosis showed that
skin sterol is strongly associated with history of myocardial
infarction (MI), or heart attack, and may indicate increased risk
of coronary-related events. Expanded patent protection for PREVU(x)
- A patent titled Multilayer Analytical Element, which describes a
"thin film" that could lead to new film-based techniques for
determining the amount of cholesterol in skin tissues, was granted
in Mexico. This patent has been granted in the United States,
Canada, Europe, China, Australia and Korea, and is pending in Japan
and Brazil. - A patent titled Method of Determining Skin Tissue
Cholesterol, which describes an alternative method of using
reagents for the measurement of cholesterol on the skin surface,
was allowed in Canada and Japan. This patent has been granted in
the United States and is pending in Europe. Continuing to pursue
re-instatement of two U.S. skin sterol patents In June 2005, IMI
submitted a request to the U.S. Patent and Trademark Office (U.S.
PTO) for consideration to accept unavoidably delayed payments of
maintenance fees for two U.S. patents related to IMI's skin sterol
technology. As disclosed in February, the U.S. PTO had asked for
more information regarding the credentials and procedures of IMI's
patent agents and their performance of clerical functions related
to the payment of the maintenance fees. Outlook "Our outlook for
the remainder of 2005 is positive," said Dr. Norton. "With the
start of PREPARE, McNeil is advancing its strategy for PREVU(x):
having multiple formats of the product available in multiple
markets. While we cannot provide specific guidance on revenue, we
expect to see sales of PREVU(x) build through the year and into
2006." Dr. Norton continued, "Another important objective for us is
to accelerate our cancer franchise. With new data expected this
fall from two LungAlert studies as well as the pivotal breast
cancer trial, we expect to initiate discussions with possible
partners as early as the fourth quarter this year." Primary
objectives for 2005 include: - Initiate a clinical trial directed
at expanding PREVU(x)'s regulatory claims to screening for risk of
heart attack; - Develop an additional test format for PREVU(x); -
Seek regulatory approval of PREVU(x) LT in Canada and Europe later
this year; - Achieve milestone payments from McNeil; and - Initiate
discussions with potential partners for IMI's cancer portfolio.
Financial Review Total product-related sales to McNeil were
$333,000 for Q2 2005 compared with $100,000 for Q2 2004. Product
sales for the six months ended June 30, 2005 were $345,000 compared
with $100,000 for 2004. This increase is attributable to McNeil's
commercial launch of PREVU(x) POC in Q1 2005. License revenue was
$78,000 compared with $27,000 for Q2 2004. For the six months ended
June 30, 2005 and 2004, license revenue was $155,000 and $28,000,
respectively, reflecting the upfront payments received in 2004 and
2003. License revenue consists primarily of the upfront cash
payments received in accordance with the respective worldwide and
Canadian licensing agreements. The net loss for Q2 2005 was
$1,455,000 or $0.07 per share compared with a loss of $1,480,000 or
$0.07 per share in the same period last year. For the six months
ended June 30, 2005, the net loss was $2,757,000 or $0.13 per share
compared with $2,562,000 or $0.12 per share for the six months
ended June 30, 2004. Research and development expenditures in the
quarter increased by $29,000 to $805,000 from $776,000 in Q2 2004.
Total research and development expenditures for the six months
ended June 30, 2005 and 2004 amounted to $1,448,000 and $1,348,000,
respectively. The primary reasons for the variance for the quarter
are: - A decrease of $131,000 in salaries and benefits due to the
timing of incentive compensation in Q2 2004 resulting from the
achievement of predetermined performance milestones; - An increase
of $137,000 in professional fees related to the petition to
reinstate two of IMI's U.S. skin sterol patents that had been
listed as abandoned in 2004; and - An increase of $12,000 in
clinical trial costs for cancer and skin sterol. General and
administration expenses amounted to $758,000 for Q2 2005 compared
with $766,000 in Q2 2004, a decrease of $8,000. General and
administration expenses for the six months ended June 30, 2005 and
2004 amounted to $1,522,000 and $1,287,000, respectively. The
primary reasons for the variance for the quarter are: - A decrease
of $85,000 in salaries and benefits due to the incentive
compensation payments in Q2 2004 resulting from the achievement of
predetermined performance milestones; - A $132,000-increase in
stock-based compensation, a non-cash expense, to $183,000 for Q2
2005 from $51,000 for Q2 2004; - An increase of $32,000 in expenses
related to the annual report and annual meeting; - A decrease of
$33,000 in fees related to investor relations for consulting and
development of public relations materials; and - A decrease of
$42,000 in office administration and travel expenses. Amortization
expenses for equipment and acquired technology for Q2 2005 amounted
to $54,000 compared with $63,000 for Q2 2004 as a result of the
lower net book value of the acquired technology. Total amortization
for the six months ended June 30, 2005 and 2004 amounted to
$106,000 and $120,000, respectively. Purchases of capital assets,
primarily in support of our clinical trial program and
manufacturing, amounted to $116,000 during 2005 compared to
$151,000 in 2004. Recoveries of provincial scientific investment
tax credits (ITCs) amounted to $48,000 for Q2 2005 compared with
$63,000 in Q2 2004. For the six months ended June 30, 2005 and
2004, recoveries of ITCs amounted to $98,000 and $100,000,
respectively. Interest income amounted to $22,000 for Q2 2005,
compared with $30,000 for Q2 2004. This decrease resulted from
lower cash balances invested through most of the quarter. As at
June 30, 2005, IMI had cash, cash equivalents and short-term
investments totaling $2,386,000. Cash used in operating activities
during Q2 2005 amounted to $1,163,000 compared with cash provided
of $1,459,000 in Q2 2004. The 2004 period was affected by the
$3,000,000-up-front licensing fee received in Q2 2004. To date, the
Company has financed its activities through product sales, license
revenues, the issuance of shares and the recovery of ITCs.
Management believes that, based on historic cash expenditures and
the current expectation of further revenues from partnering
activities, product sales and royalties, its existing cash
resources together with the ITC receivable of $299,000 will be
sufficient to meet its current operating and capital requirements
until at least Q2 2006.
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Conference Call and Webcast IMI will hold a conference call and
webcast tomorrow, August 11, 2005, at 10 a.m. ET. To access the
conference call, please dial 1-866-249-6463. A live audio webcast
will be available at http://www.imimedical.com/, and will be
subsequently archived for three months. To access the replay via
telephone, which will be available until August 20, 2005, please
dial (416) 640-1917 or (877) 289-8525 and enter the passcode
21133790 followed by the number sign.
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About IMI IMI (http://www.imimedical.com/) is a leading predictive
medicine company dedicated to developing rapid, non-invasive tests
for the early detection of life-threatening diseases. IMI's
cardiovascular products, which are branded as PREVU(x) Skin Sterol
Test, are marketed and distributed worldwide by McNeil Consumer
Healthcare, Canada. The company's cancer tests include
ColorectAlert(TM), LungAlert(TM) and a breast cancer test. IMI's
head office is located in Toronto, and its research and product
development facility is at McMaster University in Hamilton,
Ontario. For information regarding PREVU(x), please go visit
http://www.prevu.com/. Corporate Name Change In September 2005, IMI
will change its corporate name to PreMD Inc. to better reflect the
company's leading position in the predictive medicine field. The
new website will be http://www.premdinc.com/. This press release
contains forward-looking statements. These statements involve known
and unknown risks and uncertainties, which could cause the
Company's actual results to differ materially from those in the
forward- looking statements. Such risks and uncertainties include,
among others, the successful development or marketing of the
Company's products, the competitiveness of the Company's products
if successfully commercialized, the lack of operating profit and
availability of funds and resources to pursue R&D projects, the
successful and timely completion of clinical studies, product
liability, reliance on third-party manufacturers, the ability of
the Company to take advantage of business opportunities,
uncertainties related to the regulatory process, the inability of
the Company to change its name to PreMD Inc. in the time projected
due to any reason, and general changes in economic conditions. In
addition, while the Company routinely obtains patents for its
products and technology, the protection offered by the Company's
patents and patent applications may be challenged, invalidated or
circumvented by our competitors and there can be no guarantee of
our ability to obtain or maintain patent protection for our
products or product candidates. Investors should consult the
Company's quarterly and annual filings with the Canadian and U.S.
securities commissions for additional information on risks and
uncertainties relating to the forward-looking statements. Investors
are cautioned not to rely on these forward-looking statements. IMI
is providing this information as of the date of this press release
and does not undertake any obligation to update any forward-looking
statements contained in this press release as a result of new
information, future events or otherwise.
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IMI International Medical Innovations Inc. Incorporated under the
laws of Canada
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Consolidated Balance Sheets (in Canadian Dollars) As at June 30,
2005 and December 31, 2004 (Unaudited) June 30 December 31 2005
2004
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ASSETS Current Cash and cash equivalents $ 75,161 $ 239,458
Short-term investments 2,311,328 4,956,945 Accounts receivable
41,704 222,348 Inventory 63,969 267,500 Prepaid expenses and other
receivables 164,861 137,015 Investment tax credits receivable
299,000 389,000
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Total current assets 2,956,023 6,212,266
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Capital assets, net of accumulated amortization of $650,879 (2004 -
$581,155) 467,006 420,955 Acquired technology, net of accumulated
amortization of $820,685 (2004 -$784,399) 326,572 362,858
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$ 3,749,601 $ 6,996,079
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LIABILITIES AND SHAREHOLDERS' EQUITY Current Accounts payable $
330,857 $ 1,021,086 Accrued liabilities 352,221 566,951 Current
portion of deferred revenue 306,900 306,900
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Total current liabilities 989,978 1,894,937
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Deferred revenue 2,450,850 2,604,300
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Total liabilities 3,440,828 4,499,237
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Shareholders' equity Capital stock 24,412,846 24,192,321
Contributed surplus 1,676,532 1,328,187 Warrants 200,000 200,000
Deficit (25,980,605) (23,223,666)
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Total shareholders' equity 308,773 2,496,842
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$ 3,749,601 $ 6,996,079
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IMI International Medical Innovations Inc.
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Consolidated Statements of Loss and Deficit (Unaudited) Three
months ended Six months ended June 30 June 30
--------------------------- --------------------------- 2005 2004
2005 2004
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REVENUE Product Sales $ 332,701 $ 100,000 $ 345,060 $ 100,000
License revenue 78,081 26,725 154,806 28,450
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410,782 126,725 499,866 128,450 Cost of product sales 319,322
93,464 330,551 93,464
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Gross Profit 91,460 33,261 169,315 34,986
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EXPENSES Research and development 805,088 776,392 1,447,574
1,347,502 General and administration 758,000 766,149 1,521,865
1,286,703 Amortization 53,705 63,023 106,011 120,291
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1,616,793 1,605,564 3,075,450 2,754,496
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RECOVERIES AND OTHER INCOME Investment tax credits 47,923 63,000
97,923 100,000 Interest 22,383 29,637 51,273 57,144
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70,306 92,637 149,196 157,144
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Net loss for the period (1,455,027) (1,479,666) (2,756,939)
(2,562,366) Deficit, beginning of period $(24,525,578)
$(18,737,467) $(23,223,666) $(17,654,767) Deficit, end of period
$(25,980,605) $(20,217,133) $(25,980,605) $(20,217,133)
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Basic and diluted loss per share $ (0.07) $ (0.07) $ (0.13) $
(0.12)
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Weighted average number of common shares outstanding 21,529,262
21,264,052 21,434,065 21,263,515
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IMI International Medical Innovations Inc.
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Consolidated Statements of Cash Flows (Unaudited) Three months
ended Six months ended June 30 June 30 ---------------------------
--------------------------- 2005 2004 2005 2004
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OPERATING ACTIVITIES Net loss for the period $ (1,455,027) $
(1,479,666) $ (2,756,939) $ (2,562,366) Add items not involving
cash Amortization 53,705 69,623 106,011 126,891 Stock compensation
costs included in: Research and development expense 58,122 55,887
88,443 76,069 General and administrative expense 183,477 50,963
282,027 85,144 Net change in non-cash working capital balances
related to operations 73,591 (211,559) (458,630) (72,815) Increase
(decrease) in deferred revenue (76,725) 2,973,275 (153,450)
2,971,550
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Cash provided by (used in) operating activities (1,162,857)
1,458,523 (2,892,538) 624,473
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INVESTING ACTIVITIES Short term investments 1,009,887 623,950
2,645,617 1,698,366 Purchase of capital assets (80,511) (77,653)
(115,776) (150,657)
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Cash provided by investing activities 929,376 546,297 2,529,841
1,547,709
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FINANCING ACTIVITIES Issuance of capital stock, net - 12,500
198,400 23,368
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Cash provided by financing activities - 12,500 198,400 23,368
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Net increase (decrease) in cash and cash equivalents during the
period (233,481) 2,017,320 (164,297) 2,195,550 Cash and cash
equivalents - Beginning of period 308,642 239,855 239,458 61,625
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- End of period $ 75,161 $ 2,257,175 75,161 $ 2,257,175
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Represented by Cash $ 75,161 $ 891,391 $ 75,161 $ 891,391 Cash
equivalents - 1,365,784 - $ 1,365,784
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$ 75,161 $ 2,257,175 $ 75,161 $ 2,257,175
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DATASOURCE: IMI International Medical Innovations Inc. CONTACT:
Company Contact: Sarah Borg-Olivier, Director, Communications, Ron
Hosking, Chief Financial Officer, T: (416) 222-3449, , ; U.S.
Investor Contact: John Nesbett, Sally Martin, The Investor
Relations Group, T: (212) 825-3210, ,
Copyright
