SANTA CLARA, Calif.,
Aug. 15, 2011 /PRNewswire/ --
NewCardio, Inc., (OTC BB: NWCI) a cardiac diagnostic technology
provider, today announced financial results for the second quarter
ended June 30, 2011. More details on
the financial results are available in the Company's Quarterly
Report on Form 10-Q, filed today with the Securities and Exchange
Commission.
Highlights
- QTinno® was selected by a top 5 global pharmaceutical company
for two Phase I drug safety studies, both of which were initiated
in the second quarter. The fully automated ECG analysis will be
delivered by one of NewCardio's existing customers, the ECG core
lab of a top 3 Clinical Research Organization, a CRO.
- NewCardio presented the results of a recent QTinno performance
study in April at a conference "Cardiovascular Safety in Drug
Development: State-of-the-Art Assessments," sponsored by the FDA,
the Cardiac Safety Research Consortium and the Heart Rhythm Society
("HRS").
- NewCardio presented the results of a key study showing that our
urgent care solution, my3KG™, had substantially greater accuracy
than expert cardiologists' interpretation of standard 12-lead ECG
(12L ECG) in diagnosing Acute Myocardial Infarction in diabetic
patients at the 60th Annual American College of Cardiology
Scientific Meeting in April
2011.
- The Company presented the results of a recent clinical study
showing at the HRS conference in May
2011 showing that recurrent atrial fibrillation (AF) was
accurately and timely detected in patients who used CardioBip™ for
daily monitoring following catheter ablation procedures. The
presentation was titled "Long-term Intermittent Wireless Remote
Monitoring of Reconstructed 12L ECG in Post-Ablation AF Patients
Using the CardioBip System." The NewCardio study results showed
that CardioBip detects recurrent AF earlier and more reliably than
the current gold standard, which is periodic Holter
monitoring.
- Two of NewCardio's recent medical and technical submissions
were accepted for presentations at the 33rd Annual International
Conference of the IEEE Engineering in Medicine and Biology Society
conference to be held early September
2011 in Boston. The two
papers were titled: 'Wireless Monitoring of Reconstructed 12L ECG
in AF Patients Enables Differential Diagnosis of Recurrent
Arrhythmias' and 'Algorithm for Quantitative 3-D Analysis of ECG
Signals Improves Myocardial Diagnosis Over Cardiologists in
Diabetic Patients'.
NewCardio generated ECG license and professional services
revenue associated with the deployment of QTinno for use in the
cardiac safety component of a drug development study, totaling
$102,000 compared to $21,000 in the second quarter of last year, an
increase of 386%. Net cash used in operating activities was
$682,000 in the current quarter,
which is a decrease of 54% from $1,492,000 in the second quarter last year. For
the quarter, the Company reported a net loss attributable to common
shareholders of $935,000, or
$(0.03) per fully diluted share,
compared to a net loss attributable to common shareholders of
$1.5 million, or $(0.05) per fully diluted share, in the second
quarter last year.
The Company is continuing to explore potential strategic funding
opportunities to provide capital and other resources for the
further development and marketing of its 3-D platform technology
solutions; however, there can be no assurance that such efforts
will be successful.
Vincent Renz, NewCardio's
President and CEO commented, "Progress in the development and
commercialization of our initial solutions remains steady, but
sure, as we continue our strategic funding efforts in raising the
capital required to accelerate the development of CardioBip and
my3KG. QTinno continues to gain market adoption, as marked by our
selection by Merck for use in two early phase QT trials, which we
believe will continue as our partners continue to educate their
drug development customers who continue to look for advanced
science and technology which will enable them to receive quality
results in a more timely and cost effective manner. In addition, we
continue to bolster the reputation of CardioBip and my3KG in the
industry through our current development and validation efforts, as
evidenced by the presentations and the acceptance of papers, and
believe this will ultimately lead to commercial success."
Dr. Patrick Maguire, Chairman of
the Board of Directors, added, "Since becoming Chairman in
June 2011, I have been actively
working with the management team and the Board on our strategic
opportunities. I continue to believe in NewCardio and the
opportunity to move forward our superior technology, which has the
potential to successfully address significant clinical needs in
cardiac safety, remote monitoring and arrhythmia detection. I look
forward to being part of NewCardio's progress and success, bringing
both my medical background as a cardiologist and business
background as CEO of a VC-backed cardiology technology company to
help the Company realize its potential."
About NewCardio, Inc.
NewCardio is a cardiac diagnostic and services company
developing and marketing proprietary software platform technologies
to provide higher accuracy to, and increase the value of, the
standard 12L ECG. NewCardio's 3-D ECG software platform
reduces the time and expense involved in assessing cardiac status
while increasing the ability to diagnose clinically significant
conditions which were previously difficult to detect.
NewCardio's software products and services significantly
improve the diagnosis and monitoring of cardiovascular disease, as
well as cardiac safety assessment of drugs under development. For
more information, visit www.newcardio.com.
Forward-Looking Statements
This press release contains forward-looking statements.
Forward-looking statements include, but are not limited to,
statements that express our intentions, beliefs, expectations,
strategies, predictions or any other statements relating to our
future activities or other future events or conditions. These
statements are based on current expectations, estimates and
projections about our business based on currently available
information and assumptions made by management. Although we believe
that the assumptions on which the forward-looking statements
contained herein are based are reasonable, any of those assumptions
could prove to be inaccurate given the inherent uncertainties as to
the occurrence or nonoccurrence of future events. These statements
are not guarantees of future performance and involve risks and
uncertainties that are difficult to predict. Therefore, actual
outcomes and results may, and are likely to, differ materially from
what is expressed or forecasted in the forward-looking statements
due to numerous factors, including the potential risks and
uncertainties set forth in Item 1A of our Annual Report on Form
10-K for the year ended December 31,
2010 and relate to our business plan, our business strategy,
development of our proprietary technology platform and our
products, timing of such development, timing and results of
clinical trials, level and timing of FDA regulatory clearance or
review, market acceptance of our products, protection of our
intellectual property, implementation of our strategic, operating
and people initiatives, benefits to be derived from personnel and
directors, ability to commercialize our products, our assumptions
regarding cash flow from operations and cash on-hand, the amount
and timing of operating costs and capital expenditures relating to
the expansion of our business, operations and infrastructure,
implementation of marketing programs, our key agreements and
strategic alliances, our ability to obtain additional capital as,
and when, needed, and on acceptable terms and general economic
conditions specific to our industry, any of which could impact
sales, costs and expenses and/or planned strategies and timing. We
assume no obligation to, and do not currently intend to, update
these forward-looking statements.
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Tables follow
|
|
|
NEWCARDIO,
INC.
|
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
June
30,
|
December
31,
|
|
|
2011
|
2010
|
|
|
(unaudited)
|
|
|
|
ASSETS
|
|
|
|
|
Current assets:
|
|
|
|
|
Cash
|
$
122,044
|
$
584,974
|
|
|
Accounts receivable,
trade
|
47,811
|
42,905
|
|
|
Prepaid expenses
|
16,972
|
32,303
|
|
|
Prepaid commitment
fees
|
550,910
|
1,958,654
|
|
|
Total current
assets
|
737,737
|
2,618,836
|
|
|
|
|
|
|
Property, plant and equipment,
net of accumulated depreciation of $200,067 and $158,950 as of June
30, 2011 and December 31, 2010, respectively
|
116,843
|
156,261
|
|
|
|
|
|
|
Other assets:
|
|
|
|
|
Patent costs, net
|
81,431
|
55,357
|
|
|
Deposits
|
22,600
|
22,600
|
|
|
Total other
assets
|
104,031
|
77,957
|
|
|
|
|
|
|
$
958,611
|
$
2,853,054
|
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDERS' DEFICIT
|
|
|
|
|
Current liabilities:
|
|
|
|
|
Accounts payable and accrued
expenses
|
$
918,705
|
$
618,413
|
|
|
Unearned revenue
|
1,000
|
1,500
|
|
|
Line of credit, $2,200,000 and
$1,900,000 to a related party as of June 30, 2011 and December 31,
2010, respectively
|
3,900,000
|
3,000,000
|
|
|
Total current
liabilities
|
4,819,705
|
3,619,913
|
|
|
|
|
|
|
Warrant derivative
liability
|
336,443
|
2,141,871
|
|
|
Preferred stock derivative
liability
|
9,052
|
250,863
|
|
|
Long term
liabilities
|
345,495
|
2,392,734
|
|
|
|
|
|
|
Total
liabilities
|
5,165,200
|
6,012,647
|
|
|
|
|
|
|
Temporary equity:
|
|
|
|
|
Preferred shares subject to
liability conversion
|
-
|
-
|
|
|
|
|
|
|
Permanent equity:
|
|
|
|
|
Stockholders'
deficit:
|
|
|
|
|
Preferred stock, $0.001 par
value; 1,000,000 shares authorized:
|
|
|
|
|
Preferred stock Series B, $0.001
par value; 18,000 shares designated; 12,116 and 12,250 shares
issued and outstanding as of June 30, 2011 and December 31,
2010, respectively
|
12
|
12
|
|
|
Preferred stock Series C, $0.001
par value; 7,000 shares designated; 2,295 shares issued and
outstanding as of June 30, 2011 and December 31, 2010
|
2
|
2
|
|
|
Preferred stock Series D, $0.001
par value; 1,000 shares designated; 1,000 and 800 shares
issued and outstanding as of June 30, 2011 and December 31, 2010,
respectively
|
1
|
1
|
|
|
Common stock, $0.001 par value,
500,000,000 shares authorized; 32,556,576 and 30,688,902 shares
issued as of June 30, 2011 and December 31, 2010, respectively;
32,494,076 and 30,563,902 shares outstanding as of June 30, 2011
and December 31, 2010, respectively
|
32,557
|
30,689
|
|
|
Additional paid in
capital
|
41,537,281
|
39,236,320
|
|
|
Deficit
|
(45,776,442)
|
(42,426,617)
|
|
|
Total stockholders'
deficit
|
(4,206,589)
|
(3,159,593)
|
|
|
|
|
|
|
$
958,611
|
$
2,853,054
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NEWCARDIO,
INC.
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
Three months
ended June 30,
|
Six months
ended June 30,
|
|
|
2011
|
2010
|
2011
|
2010
|
|
|
Revenue
|
$
101,559
|
$
21,077
|
$
140,628
|
$
70,118
|
|
|
Cost of sales
|
35,933
|
44,823
|
97,645
|
63,307
|
|
|
Gross profit (loss)
|
65,626
|
(23,746)
|
42,983
|
6,811
|
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
Selling, general and
administrative
|
1,095,513
|
1,645,112
|
2,305,467
|
3,547,122
|
|
|
Depreciation
|
11,927
|
11,496
|
24,246
|
21,969
|
|
|
Research and
development
|
692,568
|
1,037,614
|
1,417,186
|
1,925,688
|
|
|
Total operating
expenses
|
1,800,008
|
2,694,222
|
3,746,899
|
5,494,779
|
|
|
|
|
|
|
|
|
Net loss from
operations
|
(1,734,382)
|
(2,717,968)
|
(3,703,916)
|
(5,487,968)
|
|
|
|
|
|
|
|
|
Other income
(expense)
|
|
|
|
|
|
|
Gain on change in fair value of
warrant derivative liability and preferred stock derivative
liability
|
1,726,046
|
1,880,553
|
2,084,270
|
614,233
|
|
|
Amortization of commitment
fees
|
(742,531)
|
(541,318)
|
(1,425,502)
|
(781,443)
|
|
|
Other financing costs
|
(75,202)
|
(60,000)
|
(100,438)
|
(85,000)
|
|
|
Interest, net
|
(109,061)
|
(27,408)
|
(204,239)
|
(41,113)
|
|
|
Total other income
(expense):
|
799,252
|
1,251,826
|
354,091
|
(293,323)
|
|
|
|
|
|
|
|
|
Net loss before income
taxes
|
(935,130)
|
(1,466,141)
|
(3,349,825)
|
(5,781,291)
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
-
|
-
|
-
|
-
|
|
|
|
|
|
|
|
|
NET LOSS ATTRIBUTABLE TO COMMON
SHAREHOLDERS
|
$
(935,130)
|
$
(1,466,141)
|
$
(3,349,825)
|
$
(5,781,291)
|
|
|
|
|
|
|
|
|
Net (loss) per share-basic and
fully diluted
|
$
(0.03)
|
$
(0.05)
|
$
(0.11)
|
$
(0.21)
|
|
|
|
|
|
|
|
|
Weighted average number of
shares-basic and fully diluted
|
32,227,739
|
28,495,245
|
31,488,868
|
27,418,543
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investor Contact:
Hayden IR
Jeff Stanlis, Partner
(602) 476-1821
jeff@haydenir.com
SOURCE NewCardio, Inc.