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Atossa Genetics Reports Loss of $482,436 as It Prepares for IPO

By a GenomeWeb staff reporter

NEW YORK (GenomeWeb News) – Atossa Genetics, which recently filed for an initial public offering, disclosed that its net loss for the most recently completed quarter rose five-fold.

For the three months ended Sept. 30, the Seattle-based molecular diagnostics firm reported a loss of $482,436, compared to $92,581 for the year-ago period, Atossa said in a document recently filed with the US Securities and Exchange Commission. Contributing to the loss is $237,249 in legal and professional expenses, up from $70, 804 in the year-ago period as Atossa prepared to file for its IPO. Compensation expenses also shot up to $140,545 during the quarter, compared to none a year ago.

The company reported no revenues for the quarter, unchanged from a year ago.

For the nine months ended Sept. 30, Atossa said it had a net loss of $744,231, or $0.13 per share. From April 2009, when the company was founded, through December 2009, it had a net loss of $122,857, or $0.03 per share.

R&D costs for the nine months ended Sept. 30, totaled $1,306, which Atossa expects to increase as it finalizes the product design for the first generation of its FDA-cleared Mammary Aspirate Specimen Cytology Test System and develops a second-generation system and related technologies.

SG&A costs for the nine months were $738,251, primarily consisting of $331,863 in legal and professional services related to the filing of its IPO.

Atossa said it had cash and cash equivalents of $29,531 as of Sept. 30.

Atossa announced its IPO in October and anticipates raising $17.6 million. Net proceeds are anticipated to be about $16 million, or approximately $18.3 million if its underwriters exercise their options in full.

It plans to use the proceeds to create a cytology and molecular diagnostics laboratory focused on breast cancer, and to manufacture and launch its MASCT System in the Northwestern US, the Seattle-based company said.

In its original filing, Atossa said that it expected to select a "large volume contract medical device manufacturer" to begin manufacturing its MASCT System for commercialization in the fourth quarter of 2010 at an estimated cost of $1.5 million. The company has now pushed back the selection period to the first quarter of 2011 and plans to begin developing a sales and marketing team by the second quarter of 2011, according to the SEC filing.

If Atossa is successful in launching the system regionally, it would proceed with a national introduction in the first quarter of 2012.

Proceeds also will be used to develop a second-generation MASCT System and to develop additional laboratory biomarker-based tests.

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