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GeneNews Q2 Revenues Fall Sharply

NEW YORK (GenomeWeb News) – GeneNews on Friday reported its revenues for the second quarter dropped more than five-fold year over year.

For the three months ended June 30, the Toronto-based molecular diagnostics firm's revenues totaled C$10,019 (US$9,729), compared to C$56,304 in the second quarter of 2012, it said in a document filed with Canadian regulators.

Royalty revenues dropped to C$7,472 in the recently completed quarter from C$51,833, while sales were down to C$2,547 from C$4,471.

In a statement, GeneNews President and COO Gailina Liew blamed "ongoing challenges in the US reimbursement landscape" for the reduction in royalty revenue.

Net loss for the quarter was C$1.9 million, or $.06 per share, compared to C$1.3 million, or C$.08 per share, a year ago. The weighted average number of shares for Q2 2013 was nearly 34 million shares while the weighted average number of shares for the year-ago period was about 16.5 million shares.

R&D expenses rose 31 percent to C$572,656 from C$438,660, and SG&A costs were up 71 percent to C$1.2 million from C$728,164.

GeneNews ended the quarter with C$510,740 in cash, and C$5.9 million in short-term investments.

Subsequent to the end of the second quarter, GeneNews announced a joint venture with Health Diagnostic Laboratory and an unnamed sales organization "with national capabilities" to create a clinical laboratory called Innovative Diagnostic Laboratory.

GeneNews granted IDL an exclusive license for certain technology related to its ColonSentry test for development and commercialization in the US, excluding New York and New Jersey, and availability of the test broadly in the US is anticipated in the third quarter, Liew said. The company said in July that it anticipates CLIA certification of the IDL lab in the third quarter.

ColonSentry has been available in New York and New Jersey through a deal with Enzo Biochem.

In July, Heiner Dreisman stepped down as interim CEO of GeneNews.

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