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Exiqon Logs 11 Percent Revenue Growth in Q2 Buoyed by miRNA PCR Products

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Exiqon reported today that its revenues increased 11 percent in the second quarter of 2011 and 21 percent in the first half of the year, driven primarily by the sales of research products, including the company's Mircury LNA Universal RT microRNA PCR platform.

The Danish life sciences research and diagnostics firm also reported that its net loss in Q2 swelled to approximately DKK 12.8 million ($2.4 million) in Q2 2011 after the company broke even in the same quarter last year. However, Exiqon reduced its net loss in the first half of 2011 22 percent to DKK 17.7 million from DKK 22.8 million in the first half of 2010.

Exiqon's total revenue increased 11 percent to DKK 26.7 million in the second quarter from DKK 24.1 million in Q2 2010. The company said that research product sales, including services, were up 13 percent in Q2 compared to the same period last year; and were up 7 percent when excluding OEM sales and reagent sales associated with license agreements.

Exiqon said that revenue growth in Q2 was affected by a periodic deviation in recognized service revenue due to an unexpected delay in a single larger program.

For the first half of 2011, Exiqon logged receipts totaling DKK 54.2 million, up 21 percent from the DKK 44.8 million it recorded in the first six months of 2010.

Research product sales in the first half increased 26 percent to DKK 46 million from DKK 36.6 year over year; however, when excluding OEM sales and reagents sales associated with license agreements, research product sales increased 19 percent to DKK 39.7 million from DKK 33.3 million in the first half of 2010.

Exiqon, which trades on Nasdaq OMX Copenhagen, is organized into two reportable operating segments: Exiqon Life Sciences, which includes sales of research products and services for miRNA analysis; and Exiqon Diagnostics, which includes R&D for several diagnostic tests currently under development at the company.

Exiqon Life Sciences accounted for the lion's share of Exiqon's total revenues in the first half of 2011 with DKK 49.9 million.

Operational highlights for the Life Sciences division in the first half of 2011 included the addition of new distributors in April, expanding its geographical coverage and total number of worldwide distributors to 18; expanding its qPCR product offerings with the Pick & Mix microRNA PCR panels and qPCR panels for analyzing mouse and rat miRNAs; and launching a new, higher throughput version of its qPCR data-analysis software.

Exiqon also noted that it granted a non-exclusive license in the first half to Idexx Laboratories to use its Locked Nucleic Acid technology in veterinary disease diagnostic products.

Operational highlights for Exiqon Diagnostics, which accounted for approximately DKK 4.6 million in first-half revenues, included positive results from a multicenter study that demonstrated the ability of the Mircury LNA Universal RT microRNA PCR platform to detect miRNA biomarkers associated with the presence of colorectal cancer in less than 0.2 mL of blood. Exiqon presented theses results in April at the American Association of Cancer Research annual meeting (PCR Insider, 4/7/11).

In addition, in June at the American Society of Clinical Oncology annual meeting Exiqon presented data compiled in collaboration with the New York University Cancer Institute that demonstrated the potential of using circulating microRNAs in serum for prognostic purposes in melanoma.

Lastly, Exiqon said that total operating expenses in the first half remained unchanged year-over-year at DKK 44.7 million, and were affected by a one-time litigation cost in the second quarter. Specifically, Santaris Pharma filed suit against Exiqon to prevent it from being awarded a patent related to the company's LNA technology; however, at the end of June these proceedings were concluded in Exiqon's favor, the company said.

Prior to this, in the first half of this year Exiqon filed its own lawsuit against Santaris in a Danish court for breach of contract and patent infringement related to the same LNA technology patents. As reported in March by PCR Insider sister publication Gene Silencing News, the companies had been in arbitration in since last September, when Exiqon became concerned about a potential breach by Santaris of a co-ownership arrangement for the LNA technology.

Exiqon is seeking DKK 98.6 million in damages. However, the company said this week that neither income nor costs associated with the litigation are included in its outlook for 2011; and that it expects to conclude the litigation by the end of the year.

For the full-year 2011, Exiqon said that it expects total revenue of DKK 105 million to 115 million. "The ongoing litigation will expectedly be concluded before year end," the company said in a statement. "If the litigation is concluded successfully, it represents a significant potential upside to the … full-year guidance. Contrarily, if the litigation is not successful, Exiqon will have realized a significant one-time cost."

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