Ciphergen CEO Steps Down as Company Restates Q2 Earnings, Posts 16-Percent Decline in Q3 Revenues
Ciphergen Biosystems this week restated its second-quarter earnings to reflect the "improper recognition" of $552,000 in revenues that its audit committee identified in mid-November (see ///issues/5_28/features/127527-1.html"sp?Article=20051110152326" target="_blank">ProteoMonitor, 11/11/2005).
The company also reported a 16-percent decline in its third-quarter revenues and announced several executive management changes.
Effective Dec. 31, William Rich will retire as CEO and as a member of the company's board of directors, while Gail Page will be promoted from president and COO to president and CEO and a member of the board. In addition, James Rathmann has been appointed executive chairman of the company and John Young will act as lead outside director.
"The restatement was a distracting event for the company, but we have been making appropriate changes to our internal controls and we are now focused on moving forward with the business," Page said in a statement.
For the second quarter of 2005, which ended June 30, Ciphergen reported restated revenues of $6.9 million as compared to the previously reported $7.5 million. The company said that the adjustment caused its reported net loss for the period to increase by $354,000 to $9.4 million.
For the third quarter of 2005, which ended Sept. 30, Ciphergen's total revenue fell to $7.1 million from $8.5 million in the third quarter of 2004.
The company's third-quarter R&D spending fell year-over-year to $3.1 million from $4.3 million in the third quarter of 2004. Its operating expense declined about 12 percent from
Ciphergen narrowed its third-quarter net loss to $7.5 million from $9.5 million in the third quarter of 2004.
As of Sept. 30, Ciphergen had $28.9 million in cash and cash equivalents.
During a conference call to discuss Ciphergen's earnings, executive management changes, and other highlights, chief financial officer Matthew Hogan said that he expects that the audit investigation, including legal fees and fees for the audit investigators, will cost about $400,000. He said that "most, but not all" revenue will be recognized in future quarters.
"We have carefully reviewed our internal controls and added internal controls to ensure that this won't happen in the future," he said.
Page said that a "mega assay" had been conducted during August and September to validate a diagnostic test for ovarian cancer which is being developed in conjunction with Quest Diagnostics. The assay involved 1,050 patient samples which were tested in triplicate on three different SELDI chips, generating 18,900 mass spectra, Page said.
An additional ovarian cancer study is being conducted using 202 new samples from a prospective collection, Page said. The study is expected to conclude in January.
Genethon to Use Hybrigenics' Y2H Platform, Software for Muscular Dystrophy Research
Genethon, a research center funded by the French Muscular Dystrophy Association, will use Hybrigenics' yeast two-hybrid screening platform to study muscle cell proteins, Hybrigenics said this week.
Genethon conducted a pilot screening study with Hybrigenics in 2004 and 2005 that identified several proteins involved in muscular dystrophies, the company said. Genethon will now use the screening platform along with Hybrigenics' protein interaction mapping software, PIMRider, to discover interactions between the proteins.
Hybrigenics said that Genethon will use the technology to map "genome-wide interactomes" to study protein mechanisms. Under the agreement, all data will belong to Genethon.
France's Muscular Dystrophy Association provided â‚¬894,000, or $1.2 million, in funding to support the project.
Expression Pathology to Discover Cancer Biomarkers with Digene
Expression Pathology will collaborate with Digene to identify cancer protein biomarkers in archived tissue, Expression Pathology said this week.
Under the terms of the agreement, Expression Pathology will employ its Liquid Tissue MS Protein Prep reagents with LC MS/MS mass spectrometry to identify proteins in microdissected formalin-fixed tissue of known pathology and clinical history. The collaboration will use Expression Pathology's Microproteomics Biomarker Discovery platform.
Financial details were not disclosed.
Bruker, U of Goettingen, PanaTecs to Develop Molecular Dx for Rheumatoid Arthritis
Bruker Daltonik, the University of Goettingen, and PanaTecs will collaborate to develop molecular diagnostic assays for rheumatoid arthritis, Bruker said this week.
In the joint project funded by the German Ministry of Education and Research, PanaTecs will apply Bruker Daltonics' CLINPROT technology for biomarker discovery, profiling and identification in the field of rheumatoid arthritis research and development. In addition, PanaTecs will offer services for biomarker identification using Bruker Daltonics' mass spectrometry equipment.
Gerhard Mueller, director of the Cooperative Center for Rheumatology, University of Goettingen, said in a statement that the center will contribute its "clinical expertise and access to a large number of clinically well characterized patient samples."
Further details of the agreement were not disclosed.
20/20 Acquires Rights to Protein Biomarkers for Lung Cancer Dx from U of Kentucky
The University of Kentucky said last week that it has licensed a panel of protein biomarkers to 20/20 GeneSystems that the company will use to develop a lung cancer diagnostic tool.
University of Kentucky researchers reported in the November 2005 issue of the American Thoracic Society's American Journal of Respiratory and Critical Care Medicine that they have identified multiple antibodies that the body's immune system produces in response to lung cancer development.
With the biomarkers identified by the team, 20/20 plans to create a screening test for the early detection of lung cancer using its proprietary layered peptide array platform.
Invitrogen Buys Xcyte's T-Cell Tech for $5M to Fatten Immunotherapy Play; Deal Ties Into Dynal Acquisition
Invitrogen will acquire Xcyte Therapies' T-cell expansion technology for $5 million in cash, the companies said last week.
The acquired assets will include intellectual property for the technology, known as the "Xcellerate Process," raw materials and equipment, and clinical data from six clinical trials of Xcyte's lead product, Xcellerated T Cells.
For Invitrogen, the acquisition is aimed at buttressing the firm's immunotherapy offerings, and plays into its acquisition of Dynal, which closed in April. "We firmly believe T-cell based therapy will become an important contributor in the efforts to fight disease in the future," Oystein Amellem, business area manager for Invitrogen's Dynal Bead Based Separation group, said in a statement.
Xcyte has collaborated with Dynal Biotech in the production of Xcyte Dynabeads, the bead Xcyte uses to expand and activate T cells for "potential therapeutic indications in oncology and infectious disease," Xcyte said in a statement.
"Expansion of T cells ex vivo using Dynabeads to which anti-CD3 and anti-C28 monoclonal antibodies are linked may prove useful for the treatment of cancer, infectious diseases and recently autoimmune diseases," Amellem added.
Terms of the acquisition also call for Xcyte to receive an undisclosed percentage of any sublicensing revenue Invitrogen derives from licensing Xcyte's intellectual property for therapeutic purposes. This part of the deal is subject to certain minimum revenue requirements, the firms said.
The transaction is subject to certain customary closing conditions, including the approval of Xcyte's stockholders.
Invitrogen to Use ProtoArray Platform in Research Collaboration with FSMA
Invitrogen will use its ProtoArray protein microarrays in a collaboration with Families of Spinal Muscular Atrophy to identify biological targets associated with spinal muscular atrophy, the organizations said this week.
SMA is a genetic disorder that causes a chronic deficiency in the production of the survival motor neuron (SMN) protein.
Invitrogen scientists will use the ProtoArray technology to screen approximately 3,000 human proteins and 5,000 yeast proteins as potential targets for SMA therapeutic intervention. The work builds upon the identification of compounds that up-regulate SMN levels in an FSMA-sponsored program at DeCode Genetics, FSMA said.
"We hope that the discovery and characterization of critical protein targets and their associated pathways will lead to new drug discovery avenues and ultimately to novel therapeutic approaches to treat SMA," said Jill Jarecki, research director of FSMA, in a statement.
The organizations said that the initial target identification stage will be followed by "further collaborative work to validate the targets and develop new compound screening assays."
Financial terms of the collaboration were not disclosed
Persistent Systems Receives $18.8M in Venture Capital Funding
Software product development company Persistent Systems has received $18.8 million in venture capital funding from Norwest Venture Partners and Gabriel Venture Partners.
The Pune, India-based company has a life sciences operation that specializes in providing software for storing, sharing, querying, annotating, and visualizing microarray, proteomic, genetic, and clinical data.