WALTHAM, Mass., May 12, 2017 (GLOBE NEWSWIRE) -- Interleukin Genetics, Inc. (OTCQB:ILIU) today announced financial results for its first quarter of 2017, ended March 31, 2017, and provided a corporate update.
“We continued to advance our refined strategy that focuses on the potential utility of our Interleukin-1 (IL-1) genetic platform in the development of new classes of drugs for cardiac disease, and management of patients who have suffered previous cardiac events,” said Mark B. Carbeau, Chief Executive Officer of Interleukin Genetics. “We believe our proprietary genetic patterns have potential to accelerate clinical development through more targeted patient recruitment and may help address important questions such as dose responses, side-effect profiles and pricing/reimbursement strategies. Commercially, we believe our test may assist clinicians in identifying patients more likely to benefit from specific drug therapies. These scientific developments are potentially significant to the post-statin era of cardiovascular medicine, and in response to increased interest from potential partners, we have made our cardiovascular test program a major focus for the company. We are expanding efforts to build additional clinical evidence and are broadening business development outreach.”
“We also continued to support our ILUSTRATM Inflammation Management Program by targeting ILUSTRA Program deployments and advancing new customer relationships that expand the evidence base for this program’s effectiveness,” said Mr. Carbeau. “These relationships will help demonstrate business impact and enable us to refine program elements for future deployments. We believe we add value by providing risk stratification, though engagement and empowerment, and by offering potential disease avoidance.”
First Quarter 2017 and Recent Highlights
- Reported results from The Ioannina Study at the annual meeting of the American College of Cardiology: Presented data that showed that certain IL-1 genetic patterns together with elevated lipoprotein (a) predict recurrent atherosclerotic cardiac events. These results corroborate findings of an earlier study published in 2014 of patients treated at the Mayo Clinic.
- Secured additional capital: Completed $1 million financing in the form of a subordinated convertible note from Bay City Capital and Horizon Technology Finance Corporation and restructured the debt facility with Horizon such that principal payments will be deferred, reducing the Company’s near-term cash requirements.
- Streamlined workforce: Restructured the Company’s work force to better utilize resources and align the organization to support our emphasis on the cardiovascular testing program and to advance a more targeted commercial strategy for the ILUSTRA Program.
First Quarter Ended March 31, 2017 Financial Results
Total revenue was $196,000 for the three months ended March 31, 2017 compared to $961,000 for the three months ended March 31, 2016. The decrease in total revenue is primarily attributable to the absence of contracted research projects recognized in Other revenue for the three months ended March 31, 2017 compared to the same period in 2016. Genetic testing revenue also declined in the three months ended March 31, 2017 compared to the same period in 2016.
Cost of revenue for the three months ended March 31, 2017, was $310,000, or 158% of total revenue, compared to $527,000, or 55% of total revenue, for the three months ended March 31, 2016. The increase in the cost of revenue as a percentage of revenue in the three months ended March 31, 2017 is primarily attributable to the fixed laboratory costs being applied to lower revenue in the period, which was due to less genetic tests processed and no contracted research projects.
Research and development expenses were $425,000 for the three months ended March 31, 2017 compared to $480,000 for the three months ended March 31, 2016. The decrease in research and development expenses was mainly due to decreased compensation expense and consulting costs.
Selling, general and administrative expenses were $1.8 million for the three months ended March 31, 2017, compared to $1.3 million for the three months ended March 31, 2016. The 35% increase is primarily attributable to increased compensation expense related to new staff in sales and marketing and higher consulting costs.
The Company reported a net loss of $2,529,710, or ($0.01) per diluted share for the three months ended March 31, 2017, compared to a net loss of $1,517,736, or ($0.01) per share in the comparable period in 2016.
As of March 31, 2017, the Company had cash of $791,000. On April 17, 2017, the Company completed a subordinated convertible note financing that raised gross proceeds of $1.0 million, and restructured its debt with Horizon Technology Finance Corporation to temporarily defer principal payments due under the loan. The Company expects that its current cash will be sufficient to support the Company’s operations through the second quarter of 2017.
About Interleukin Genetics, Inc.
Interleukin Genetics, Inc. (OTCQB:ILIU) develops and markets proprietary genetic tests for chronic inflammatory diseases and health-related conditions, with significant expertise in metabolism and inflammation. Our tests provide information that is not otherwise available, to empower individuals and their healthcare providers to manage their health and wellness through genetics-based insights and actionable guidance, including pharmacogenomics information to guide development and use of therapeutics. Interleukin Genetics’ lead products include our proprietary cardiovascular test to guide treatment of high risk patients; our proprietary ILUSTRA Inflammation Management Program; and its Inherent Health® line of genetic tests. Interleukin Genetics is headquartered in suburban Boston and operates an on-site DNA testing laboratory certified under the Clinical Laboratory Improvement Amendments (CLIA). For more information, please visit www.ilgenetics.com.
Forward-Looking Statements
Certain statements contained herein are “forward-looking” statements, including, but not limited to, statements that the Company’s current cash will be sufficient to support the Company’s operations through the second quarter of 2017, and statements about our expected business focus and the expected benefits and potential of our products and potential products. Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to, those risks and uncertainties described in the Company’s annual report on Form 10-K for the year ended December 31, 2016, and other filings with the Securities and Exchange Commission. The Company disclaims any obligation or intention to update these forward-looking statements.
| INTERLEUKIN GENETICS, INC. | |||||||||
| FINANCIAL HIGHLIGHTS | |||||||||
| Balance Sheet Data | March 31, | March 31, | |||||||
| 2017 | 2016 | ||||||||
| Cash and cash equivalents | $ | 790,737 | $ | 2,657,214 | |||||
| Total current assets | $ | 1,399,791 | $ | 3,271,150 | |||||
| Total assets | $ | 1,901,659 | $ | 3,835,772 | |||||
| Total current liabilities | $ | 6,087,405 | $ | 5,551,228 | |||||
| Total liabilities | $ | 6,916,058 | $ | 6,681,322 | |||||
| Total shareholders' equity/(deficit) | $ | (5,014,399 | ) | $ | (2,845,550 | ) | |||
| Total liabilities and shareholders' deficit | $ | 1,901,659 | $ | 3,835,772 | |||||
| Statement of Operations Data | Three Months Ended Mar 31, | ||||||||
| 2017 | 2016 | ||||||||
| Revenue: | |||||||||
| Genetic testing service revenue | $ | 140,638 | $ | 262,469 | |||||
| Other | 55,806 | 698,449 | |||||||
| Total revenue | 196,444 | 960,918 | |||||||
| Less Sales Allowance & Discount | - | - | |||||||
| Net revenue | 196,444 | 960,918 | |||||||
| Cost of Revenue | 309,876 | 526,946 | |||||||
| Gross profit (loss) | (113,432 | ) | 433,972 | ||||||
| Operating costs and expenses: | |||||||||
| Research and development | 424,591 | 480,057 | |||||||
| Selling, general and administrative | 1,769,773 | 1,311,185 | |||||||
| Amortization of intangibles | 4,780 | 8,362 | |||||||
| Total operating expenses | 2,199,144 | 1,799,604 | |||||||
| Loss from operations | (2,312,576 | ) | (1,365,632 | ) | |||||
| Total other income and (expense), net | (217,134 | ) | (152,104 | ) | |||||
| Loss from continuing operations | |||||||||
| before income taxes | (2,529,710 | ) | (1,517,736 | ) | |||||
| Income taxes | - | - | |||||||
| Loss from continuing operations | $ | (2,529,710 | ) | $ | (1,517,736 | ) | |||
| Income from discontinued Operations, | |||||||||
| net of income taxes | - | - | |||||||
| Net loss | $ | (2,529,710 | ) | $ | (1,517,736 | ) | |||
| Basic and diluted net (loss) income per | |||||||||
| common share from: | |||||||||
| Continuing operations | $ | (0.01 | ) | $ | (0.01 | ) | |||
| Discontinued operations | 0.00 | 0.00 | |||||||
| Net loss | $ | (0.01 | ) | $ | (0.01 | ) | |||
| Weighted average common shares outstanding, | |||||||||
| basic and diluted | 229,434,511 | 172,951,968 | |||||||