Vermillion, a bio-analytical solutions company focused on gynecologic disease, reported on its financial results for the first quarter ended March 31, 2016.
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Total revenue in the first quarter of 2016 was $505,000 compared to $951,000 in the same year-ago quarter. All first quarter 2016 revenue was recognized from product sales of OVA1 by ASPiRA LABS.
First quarter revenue in 2015 was comprised of $635,000 in OVA1 product revenue primarily from sales by Quest Diagnostics and $316,000 in license revenue.
Also, product revenue for the first quarter of 2015 included the one-time recognition of $163,000 in deferred product revenue upon the signing of company's commercial agreement with Quest Diagnostics in March 2015. Thus, the quarters are not directly comparable.
Product revenue in the first quarter of 2016 was derived from 2,265 OVA1 tests performed by ASPiRA LABS. In the first quarter of the prior year, ASPiRA LABS performed a total of 216 OVA1 tests in addition to the 3,567 OVA1 tests performed at Quest Diagnostics.
Vermillion estimates that OVA1 volume for the second quarter of 2016 will exceed 2,300 tests.
Cost of product revenue for the first quarter of 2016 totaled $528,000 and was consistent with the comparable prior year quarter.
Total operating expenses in the first quarter of 2016 increased to $4.9 million compared to $4.7 million in the same year-ago quarter. The increase was due primarily to costs related to establishing the laboratory for launching ASPiRA IVD services as well as severance costs relating to company's February 2016 restructuring.
The goal of the restructuring was to reduce go-forward operating expense by approximately 20% from company's 2015 run rate.
Net loss for the first quarter of 2016 was $4.9 million or $0.09 per share, as compared to a net loss of $4.1 million or $0.10 per share in the same year-ago quarter.
As of March 31, 2016, cash and equivalents totaled $13.1 million. The company utilized $5.6 million in cash in the first quarter of 2016 including $600,000 of capital expenditures primarily for IT infrastructure and ASPiRA IVD's laboratory build out.
Subsequent to March 31, 2016, Vermillion received $2.0 million in disbursements from a loan of up to $4.0 million from the DECD.
The remaining $2.0 million will be disbursed if and when the Company achieves certain future milestones. Including the $2.0 million received from the State of Connecticut, Vermillion expects net cash utilization of $2.0 million - $3.0 million in the second quarter of 2016. ■