This article has been updated to include additional comments from Helicos' conference call this morning.
NEW YORK (GenomeWeb News) – Helicos BioSciences today reported a 15 percent increase in its third-quarter net loss and a dip in grant revenue as it continues to perform validation studies of its flagship Helicos Genetic Analysis Platform in house. It also revised its guidance downward on orders for the system for the remainder of this year, citing economic conditions.
The Cambridge, Mass.-based firm brought in grant revenue of $202,000 for the three-month period ended Sept. 30, down from grant revenue of $230,000 in the third quarter of 2007. The grant revenue comes from a three-year, $2 million award from the National Human Genome Research Institute that was awarded in 2006
and runs through August 2009.
Helicos has placed two of its systems this year with genomics services firm Expression Analysis and a cancer research center at Stanford University, but it has yet to recognize any commercial revenue.
In addition to those two systems, the firm currently has six HeliScope instruments in house that have completed validation studies and are ready to ship to potential customers, Helicos President and CEO Steve Lombardi said during the call. He said those six validated instruments are “running customer samples to help us close business in the quarter.”
In late September, Lombardi told investors at the UBS Global Life Sciences Conference that the firm expects
to have a total of between five and 10 orders for the HeliScope instrument by the end of this year and a total of 15 to 30 orders for its Genetic Analysis System, which includes the HeliScope, by mid-2009.
During the call today, Lombardi said, “Since then, the economic conditions, especially those of a small cap company like ours, have been tough.” He said that the sales cycle for the firm’s system has lengthened, and he now estimates that orders for the system will be at the low end of the guidance for full-year 2008. Lombardi added that he would provide an update on expected orders for the first half of 2009 during Helicos’ year-end conference call.
Specifically, Lombardi said that the firm’s primary customers, the large academic health centers, are taking a harder look at capital equipment purchases, and combined with the economic climate, that is lengthening the sales cycle.
Helicos posted a Q3 net loss of $11.5 million, or $.55 per share, compared with a net loss of $10 million, or $.48 per share, for the third quarter of 2007.
The firm’s R&D costs declined 22 percent year over year to $5.6 million from $7.2 million, while its SG&A spending increased 50 percent to $5.4 million from $3.6 million.
Helicos finished the third quarter with $12.3 million in cash, $8.9 million in working capital, and $10.4 million in restricted cash.
Helicos CFO Stephen Hall said during the call that the firm’s cash-burn rate is around $2.5 million per month, or $7.5 million for the balance of the year. He said the firm is “actively reviewing fundraising opportunities,” but he declined to provide further details.
“We believe we can be successful in raising our funds,” he added.
In late Wednesday trading on the Nasdaq, shares of Helicos were up nearly 4 percent at $.87.