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Nanosphere's Q1 Top Line Hit by Lower Contract Revenue

By a GenomeWeb staff reporter

NEW YORK (GenomeWeb News) – Nanosphere today reported that its first-quarter revenues declined, as contract revenue from the first quarter of 2010 was much higher than in 2011, but its product sales increased 31 percent.

The Northbrook, Ill.-based molecular diagnostics firm brought in total revenues of $640,000 for the three-month period ended March 31, down from $826,000 for Q1 2010. Nanosphere missed analysts' consensus estimate for revenues of $940,000.

Its product sales were $586,000 versus $446,000 for the comparable period of 2010. Its contract revenue declined to $54,000 in Q1 2011 from $380,000 for the first quarter of 2010, which was due to the completion of two assay development contracts.

Nanosphere said that its product sales growth was driven by new customer placements of its platform and customers adopting its respiratory virus test, which was cleared for marketing by the US Food and Drug Administration earlier this year.

The firm's net loss for the quarter was $8.9 million, or $.32 per share, compared to a net loss of $8.6 million, or $.31 per share, for the first quarter of 2010. It beat analysts' estimates for a loss of $.35 per share.

Nanosphere's R&D spending increased 7 percent to $4.7 million from $4.4 million, and its SG&A spending also climbed 7 percent to $4.4 million from $4.1 million.

"We generated more new business in the first quarter of 2011 than we have in any previous quarter," Nanosphere President and CEO William Moffitt said in a statement. "As we continue to expand our menu and market presence, we will build a revenue ramp that will enable us to sustain our operations for long-term maximum value creation."

Nanosphere finished the quarter with cash and cash equivalents of $30 million.

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