Applied DNA Reports Fiscal Third Quarter 2019 Financial Results

On August 13, 2019 Applied DNA Sciences, Inc. (NASDAQ: APDN) ("Applied DNA" or the "Company"), consolidated financial results for the fiscal 2019 third quarter ended June 30, 2019 (Press release, Applied DNA Sciences, AUG 13, 2019, View Source [SID1234538658]). "Our fiscal third quarter performance reflects our continuing abilities to monetize our molecular taggant technology and our diagnostic and therapeutic platforms while also realigning our cost structure and reorienting our sales and business development efforts to support new opportunities," said Dr. James A. Hayward, chairman, president and CEO of Applied DNA. "Revenues increased over 100% this quarter over the same period last fiscal year and increased 164% quarter over quarter, supplemented by the receipt of a $1 million cash payment under the terms of our exclusive licensing agreement with TheraCann International Benchmark Corporation (TheraCann)."

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"After the close of the quarter we received a written delisting notice from Nasdaq regarding our non-compliance with the requirements for a $1.00 bid price and $35 million market value of listed securities. We are diligently working to comply with all applicable requirements for continued listing on Nasdaq and we intend to submit a plan to that effect to the NASDAQ Hearings Panel as part of the hearing process," continued Dr. Hayward. "As part of our plan, we secured a non-binding term sheet from TheraCann for the outstanding $4 million balance under our licensing agreement in the form of $4 million in convertible preferred stock as well as an incremental $1 million convertible note. We also raised $1.5 million through a convertible note offering, which increases our current convertible notes outstanding to approximately $3.7 million. If any portion of these notes were to convert into common stock, it would increase our equity as a further step towards facilitating Nasdaq compliance. We are engaged in Nasdaq’s appeal process, and I am pleased to report that we have secured a hearing for September 19, 2019 that allows us additional time to execute on the balance of our plan. However, we can not provide assurance that we will be successful in our NASDAQ appeal."

Concluded, Dr. Hayward, "As we projected last quarter, our growth is coming from cannabis, textiles and biotherapeutics. Looking ahead, we remain focused on growth supported by these business verticals. TheraCann’s ETCH BioTrace solution powered by our tagging platform is attracting the attention of large cannabis players. We will soon launch our CertainT brand into the cotton apparel market. Initial product from our recently completed tagging program for Egyptian cotton is being used to build demand among brands and manufacturers. Our LineaRx subsidiary is increasingly being viewed within the biotech industry as a cleaner, higher-performing alternative to plasmid DNA production that is converting to increased order-flow. We have a burgeoning pipeline and growing scientific and intellectual property assets following the recent acquisition by LineaRx of the assets and IP of Vitatex, Inc. that further broaden our platform’s applicability in the potentially high-reward cancer diagnostic and therapeutic spaces. Just last week we submitted to the NIH our application for a 3-year, approximately $4 million SBIR Phase IIb grant to be matched with funding being sought from commercial 3rd parties, that, if granted, will fund the full commercialization of the Vitatex platform for early detection of non-hematologic cancers."

Fiscal Third Quarter 2019 Financial Results:

Revenues increased 102% for the third quarter of fiscal 2019 to $2.1 million, compared with $1.0 million reported in the second quarter of fiscal 2018, and increased 164% from the $778 thousand reported in the second fiscal quarter ended March 31, 2019. The increase in revenues was due primarily to an increase in revenue from a licensing agreement in the cannabis industry of $1 million.
Total operating expenses decreased to $3.2 million for the second fiscal quarter of 2019, compared with $3.6 million in the prior fiscal year’s second quarter. This decrease is primarily attributable to approximately a $409 thousand decrease in payroll, due to a realignment of the sales force and reductions in overall headcount. This decrease in payroll was offset by an increase in legal and professional fees.
Net loss for the quarter ended June 30, 2019 was $1.5 million, or $0.04 per share, compared with a net loss of $2.9 million, or $0.10 per share, for the quarter ended June 30, 2018 and a net loss of $2.7 million, or $0.08 per share, for the quarter ended March 31, 2018.
Excluding non-cash expenses, Adjusted EBITDA was negative $1.2 million and a negative $2.5 million for the quarters ended June 30, 2019 and 2018, respectively. See below for information regarding non-GAAP measures.
Nine-Month Financial Highlights:

Revenues for the first nine months of fiscal 2019 totaled $3.7 million, an increase of 37% from $2.7 million from the same period in the prior fiscal year. The increase in revenues was due to an increase in service revenues of $1.4 million, or 92%, offset by a decrease in product revenues of $344 thousand, or 28%. The increase in service revenue was attributable to an increase in revenue of $1 million from the licensing agreement in the cannabis industry, as well as increases of $140 thousand for a pre-commercial feasibility project under the cooperation agreement with TheraCann entered into during 2018, $51 thousand for the government contract award and $143 thousand from pre-commercial pilots within the textile industry.
Effective October 1, 2018, the Company was required to adopt Accounting Standards Update (ASU; the "Update") No. 2014-09, Revenue from Contracts with Customers (Topic 606), utilizing the modified retrospective method. Had the Company not adopted the Update, the Company would have recognized additional revenue of approximately $851 thousand during the first nine months of fiscal 2019. This amount was primarily comprised of the recognition of $766 thousand during the nine months periods ended June 30, 2019, under a $1.15 million cotton order shipped in June 2018, with extended payment terms. The total cumulative impact of the Update that was recorded to opening retained earnings in fiscal 2019 was approximately $494 thousand. See Cumulative Effect Adjustment and the Impact on Current Period Financial Statements of Adopting Topic 606 attached.
Operating expenses for the nine months ended June 30, 2019 increased by $486 thousand or 5% for the same period last fiscal year. The increase is primarily attributable to an increase in stock-based compensation and legal and professional fees, offset by a decrease in payroll of $659 thousand.
Net loss for the nine months ended June 30, 2019 was $7.4 million or $0.21 per share, compared with a net loss of $8.2 million or $0.28 per share for the nine months ended June 30, 2018.
Excluding non-cash expenses and interest, Adjusted EBITDA for the nine months ended June 30, 2019 was a negative $6.1 million as compared to a negative $7.6 million for the same period in the prior fiscal year. See below for information regarding non-GAAP measures.
Fiscal Third Quarter 2019 Conference Call Information

The Company will hold a conference call and webcast to discuss its fiscal third quarter-end 2019 results on Tuesday, August 13, 2019 at 4:30 PM ET. To participate on the conference call, please follow the instructions below. While every attempt will be made to answer investors’ questions on the Q&A portion of the call, due to the large number of expected participants, not all questions may be answered.

To Participate:

Participant Toll Free:1-844-887-9402
Participant Toll: 1-412-317-6798
Please ask to be joined to the Applied DNA Sciences call
Live webcast: View Source

Replay (available 1 hour following the conclusion of the live call through August 21, 2019):

Participant Toll Free: 1-877-344-7529
Participant Toll: 1-412-317-0088
Participant Passcode: 10133063
Webcast replay: View Source
For those investors unable to attend the live call, a copy of management’s PowerPoint presentation will be available for review under the ‘Events and Presentations’ section of the company’s Investor Relations web site: View Source

Information about Non-GAAP Financial Measures

As used herein, "GAAP" refers to accounting principles generally accepted in the United States of America. To supplement our condensed consolidated financial statements prepared and presented in accordance with GAAP, this earnings release includes Adjusted EBITDA, which is a non-GAAP financial measure as defined in Rule 101 of Regulation G promulgated by the Securities and Exchange Commission. Generally, a non-GAAP financial measure is a numerical measure of a company’s historical or future performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information presented in accordance with GAAP. We use this non-GAAP financial measure for internal financial and operational decision making purposes and as a means to evaluate period-to-period comparisons of the performance and results of operations of our core business. Our management believes that these non-GAAP financial measures provide meaningful supplemental information regarding the performance of our business by excluding non-cash expenses that may not be indicative of our recurring operating results. We believe this non-GAAP financial measure is useful to investors as they allow for greater transparency with respect to key metrics used by management in its financial and operational decision making.

"EBITDA"- is defined as earnings (loss) before interest expense, income tax expense and depreciation and amortization expense.

"Adjusted EBITDA"- is defined as EBITDA adjusted to exclude (i) stock-based compensation and (ii) other non-cash expenses.

Personalis Reports Second Quarter 2019 Financial Results

On August 13, 2019 Personalis, Inc. (Nasdaq: PSNL), a leader in advanced genomics for cancer, reported financial results for the second quarter ended June 30, 2019 (Press release, Personalis, AUG 13, 2019, View Source [SID1234538657]).

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Second Quarter 2019 Highlights

Record revenues of $15.8 million in the second quarter of 2019, versus $8.8 million in the second quarter of 2018, an increase of 80%
In June, completed initial public offering of 9.1 million shares, raising $140.0 million in net proceeds, after deducting underwriting discounts, and fees and other expenses
Announced several important customer and partner relationships including agreements with the Parker Institute for Cancer Immunotherapy and RAPT Therapeutics
Initial customer pilots of ImmunoID NeXT, the company’s universal cancer immunogenomics platform
"The Personalis team has made solid progress over the last few months. With our raising of $140 million and very encouraging traction with our Million Veteran Program and biopharmaceutical customers, I believe we are well-positioned for continued growth ahead," said John West, Chief Executive Officer. "With the proceeds from our offering, we are driving the build out of our commercial infrastructure and accelerating our new product programs to capitalize on the approximately $5 billion total addressable market for comprehensive tissue and liquid biopsy testing, and investing in our operational capabilities and infrastructure so we can scale quickly in response to customer demands."

Second Quarter 2019 Financial Results

Revenues were $15.8 million in the three months ended June 30, 2019, up 80% from $8.8 million in the same period of the prior year. Second quarter revenue growth was driven by an increase in volume for testing and analytical services provided to pharmaceutical, biotech, the U.S. Department of Veterans Affairs "Million Veteran Program" ("VA-MVP"), universities, and research laboratory customers. The VA-MVP accounted for 54% of our revenues in the three months ended June 30, 2019, and the remaining 46% was primarily from pharmaceutical and biotech customers.

Gross margin for the three months ended June 30, 2019 was 37.3% and increased 10.1% from 27.2% in the same period of the prior year.

Operating expenses totaled $10.0 million for the three months ended June 30, 2019, compared with $6.1 million for the same period of the prior year.

Net loss for the three months ended June 30, 2019 was $5.9 million and net loss per share was $0.89 based on a weighted-average basic and diluted share count of 6.6 million, compared with a net loss of $7.3 million and a net loss per share of $2.39 on a weighted-average basic and diluted share count of 3.1 million last year.

Cash and cash equivalents were $163.3 million as of June 30, 2019. Personalis received net proceeds of $140.0 million in its initial public offering, net of underwriting discounts, fees and expenses payable by the company, and issued 9.1 million shares of common stock.

2019 Outlook

Personalis expects full year 2019 revenues to be in the range of $60 million to $62 million, representing 59% to 64% growth over full year 2018.

Webcast and Conference Call Information

Personalis will host a conference call to discuss the second quarter financial results after market close on Tuesday, August 13, 2019 at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time. The conference call can be accessed live over the phone (866) 220-8061 for U.S. callers or (470) 495-9168 for international callers, using conference ID: 5981178. The live webinar can be accessed at View Source

Deciphera Pharmaceuticals Announces Proposed Public Offering of Common Stock

On August 13, 2019 Deciphera Pharmaceuticals, Inc. (NASDAQ:DCPH), a clinical-stage biopharmaceutical company focused on addressing key mechanisms of tumor drug resistance, reported the commencement of a registered underwritten public offering of $200.0 million in shares of its common stock (Press release, Deciphera Pharmaceuticals, AUG 13, 2019, View Source [SID1234538656]). In addition, Deciphera intends to grant the underwriters a 30-day option to purchase up to $30.0 million in shares of its common stock.

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J.P. Morgan, Piper Jaffray and Jefferies are acting as joint book-running managers for the offering.

Deciphera intends to use the net proceeds of the offering to fund: clinical trials for ripretinib, including the expansion stage of its current Phase 1 clinical trial, its ongoing pivotal Phase 3 clinical trials, and additional clinical trials, as well as clinical research outsourcing and manufacturing of clinical trial material, and pre-commercialization manufacturing process development and validation; clinical trials for DCC-3014, including the expansion stage of its current Phase 1 clinical trial, as well as clinical research outsourcing and manufacturing of clinical trial material; clinical trials for rebastinib, including its current Phase 1b/2 clinical trial, as well as clinical research outsourcing and manufacturing of clinical trial material; Investigational New Drug-enabling studies and the potential development of DCC-3116; new and ongoing research activities for future drug candidates using its proprietary kinase switch control inhibitor platform; continued growth of its commercial and medical affairs capabilities to support its transition from a development-stage company toward a commercial-stage company; and working capital purposes, including general operating expenses.

A shelf registration statement relating to the shares of common stock offered in the public offering described above was filed with the Securities and Exchange Commission (SEC) and was declared effective by the SEC on October 12, 2018. The securities may be offered only by means of a written prospectus, including a prospectus supplement, forming a part of the effective registration statement. A preliminary prospectus supplement and accompanying prospectus relating to the offering will be filed with the SEC and will be available on the SEC’s website at www.sec.gov. When available, copies of the preliminary prospectus supplement and the accompanying prospectus relating to the offering may also be obtained from J.P. Morgan Securities LLC c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, or by telephone at (866) 803-9204, or by email at [email protected]; Piper Jaffray & Co., 800 Nicollet Mall, J12S03, Minneapolis, Minnesota, 55402, Attention: Prospectus Department, by telephone at (800) 747-3924 or by email at [email protected]; and Jefferies LLC, Attention: Equity Syndicate Prospectus Department, 520 Madison Avenue, 2nd Floor, New York, NY 10022, by telephone at (877) 821-7388 or by email at [email protected].

This press release does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

KIYATEC Announces Addition of Capital Health as Clinical Site in Trial to Predict GBM Patient-Specific Response to Cancer Drugs Prior to Treatment

On August 13, 2019 KIYATEC, Inc. reported that Capital Health has joined its U.S. clinical trial, 3D-PREDICT, to validate the company’s test as a patient-specific predictor of response to cancer therapies in glioblastoma (GBM) and anaplastic astrocytoma (AA) patients (Press release, KIYATEC, AUG 13, 2019, View Source [SID1234538655]). Capital Health is currently the only healthcare system in New Jersey, Pennsylvania and the New York City region enrolling GBM patients in the study.

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"Capital Health is committed to improving the health and well-being of our patients, while making the care we provide as personalized as possible. Taking part in this clinical trial underscores our mission to provide the best care, for each individual patient, at the earliest possible time," said Dr. Navid Redjal, director of Neurosurgical Oncology at Capital Health, and lead investigator of the study. "In oncology treatment, and especially for our patients with glioblastoma, being able to predict if a treatment will be successful has the potential to truly change patient care, particularly when time is of the essence."

3D-PREDICT is a prospective, open-label, multi-institutional, non-interventional study to validate KIYATEC’s EV3D platform for clinical use and to investigate the impact on outcomes for cancer patients with both newly diagnosed and recurrent epithelial ovarian cancer and recurrent high-grade gliomas. KIYATEC’s EV3D cell culture platform utilizes live cancer cells derived from surgical or biopsy tissue to create a patient specific in vivo-like tumor and immune microenvironment. The tumor and immune microenvironment are used to accurately model and assess responses from both investigational and approved cancer therapies. The study is anticipated to continue through 2020. Details on the trial can be found on View Source

"The continued growth of patient enrollment with the addition of Capital Health is a true testament to the value that oncology clinical teams realize in being able to better determine a viable treatment path for their patients at the earliest possible time," said Matthew Gevaert, CEO of KIYATEC. "We are realizing tremendous momentum, both with our ongoing clinical trial as well as recent publication of the positive results of our ovarian cancer study in the Nature journal Scientific Reports. This is a truly exciting time in the company’s growth as we continue on our path to provide a more personalized cancer treatment experience for patients."

Genprex Demonstrates Growth and Expansion Through Recent Achievements

On August 13, 2019 Genprex, Inc. (NASDAQ: GNPX), a clinical-stage gene therapy company, reported recent achievements the company has completed as a part of the company’s overall strategy to expand its clinical development programs and bring its lead drug candidate, Oncoprex immunogene therapy, to commercialization (Press release, Genprex, AUG 13, 2019, View Source [SID1234538654]).

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These recent achievements are outlined in the company’s newly launched, interactive corporate timeline, which can be found on Genprex’s website.

"Since Genprex’s IPO last year, we have made significant progress in many areas of the company, including progress toward expansion of our clinical programs and sponsored research, our manufacturing process development and scalability, and the growth of our team to support these initatives," said Rodney Varner, Chairman and Chief Executive Officer of Genprex. "These accomplishments have set the stage for us to continue on our path of growth and expansion, enabling our efforts to bring our drug candidate to market for lung cancer patients who cannot benefit from today’s therapies."

Genprex’s updates to ongoing activities, include:

Q2 2019

Announced positive pre-clinical findings from MD Anderson Cancer Center Sponsored Research Agreement studying the effects of TUSC2 with pembrolizumab at American Association of Cancer Research meeting
Developed Oncoprex and immunotherapy combination clinical trial design
Collaborated with Addison Whitney for drug nomenclature branding program and submission of non-proprietary drug name selections
Initiated manufacturing process development with key manufacturing partners to support clinical expansion and manufacturing scale-up processes
Completed manufacturing of TUSC2 DNA plasmid to support clinical trial ramp-up
Q1 2019

Appointed Key Staff: Senior Director of Pharmaceutical Sciences and Manufacturing and Senior Manager of Communications and Marketing
USPTO issued two additional patents to add to our intellectual property portfolio
Identified potential new clinical sites for expansion of Oncoprex and erlotinib combination clinical trial
Q4 2018

Appointed Key Staff: VP of Clinical Operations
Completion of clinical data reconciliation within a CDISC/SDTM-compliant database
Q3 2018

Initiated clinical site selection and expansion program with CRO partner
Initialization of sponsored pre-clinical research with MD Anderson Cancer Center to evaluate TUSC2 with immunotherapies including immune checkpoint inhibitors anti-PD1 and CTLA-4
Q2 2018

Continued execution and enhancement of strategy for manufacturing technology transfer and scale-up initiatives
Genprex’s new interactive timeline on its website shares additional historical achievements, where visitors can follow the company’s success since its inception.