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Rosetta Genomics Q2 Revenues Jump on Sales of Thyroid Assay

NEW YORK (GenomeWeb) – Rosetta Genomics today reported a 115 percent jump in its second quarter revenues, due to increased sales of the company's RosettaGX Reveal assay for the classification of indeterminate thyroid nodules (ITN).

The company also disclosed that the previously announced $2.9 million sale of its PersonalizeDx business has been delayed after the buyer, Pragmin Prognosis, failed to complete the transaction.

For the three months ended June 30, Rosetta's revenues climbed to $870,000 from $404,000 in the year-ago quarter. Sales of Reveal rose more than four-fold in the quarter to $699,000 from $166,000, more than offsetting a 28 percent decrease in Q2 revenues from solid tumor testing services to $171,000 from $238,000 the year before.

Rosetta has been increasingly making Reveal its primary focus since the test's launch in early 2016, and earlier this year the firm announced that it was redirecting "substantially all" of its sales and marketing resources on Reveal. Part of that effort included layoffs and the signing of a sale agreement for PersonalizeDx with Pragmin.

"We are pleased with the progress we made during the first half of 2017 in increasing revenue and unit volume for Reveal in the ITN classification market," Rosetta President and CEO Kenneth Berlin said in a statement. "In addition to an increased unit demand for Reveal, we continue to work with payers to ensure proper payment for this high-value assay." He added that preliminary third quarter revenues of Reveal are up 23 percent over Q2 revenues at $860,000.

As for the PersonalizeDx deal, Rosetta said that Pragmin has thus far not complied with its acquisition obligation. The firm is considering all its options, including litigation against Pragmin and seeking a new buyer for the business.

Rosetta's Q2 net loss narrowed to $2.1 million from $3.4 million a year earlier. On a per share basis, the firm reported a Q2 net loss of , or $.81 on 2.5 million shares outstanding compared to a net loss of $1.95 a share on 1.7 million shares outstanding a year earlier. In March, Rosetta effected a 1-for-12 reverse stock split.

R&D spending in the second quarter decreased 23 percent to $476,000 from $617,000, primarily resulting from a reduction in compensation expense and travel. Meanwhile, SG&A costs dropped 54 percent to $1.2 million from $2.6 million, mostly due to lower headcount and decreased marketing/consulting expenses.

As of June 30, Rosetta had cash and cash equivalents totaling $1.3 million. Since the end of the second quarter, Rosetta has netted about $4.7 million from a public offering of ordinary shares and warrants, as well as a private placement of convertible debentures and warrants.

The company said that it expects to have sufficient funds to continue operations into the latter part of the fourth quarter.