UroMed Corporation Announces Third Quarter Results.NORWOOD Norwood. 1 Town (1990 pop. 28,700), Norfolk co., E Mass.; settled 1678, set off from Dedham and Walpole and inc. 1872. Chiefly residential, its industries include printing and publishing and the manufacture of plastics, apparel, computer software, and , Mass.--(BW HealthWire)--Oct. 20, 1999-- Continued Growth and Achievement in Prostate Cancer Treatment Market THIRD-QUARTER 1999 RESULTS UroMed Corporation (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on SmallCap:URMD) today reported revenues of $0.7 million for the third quarter ended September 30, 1999, compared with $0.3 million for the same period of 1998. UroMed reported a loss from operations of $1.2 million for the third quarter ended September 30, 1999, compared with a loss from operations of $3.0 million for the same period in 1998. For the nine months ended September 30, 1999, UroMed reported revenues of $1.8 million, compared with revenues of $0.4 million for the same period of 1998, and reported a loss from operations of $4.7 million, compared with a loss from operations of $14.0 million for the same period in 1998. As of September 30, 1999, the Company had cash, cash equivalents and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments totaling $23.2 million. UroMed reported a net loss of $0.6 million, or $0.12 per share, for the third quarter ended September 30, 1999, compared with net income of $1.5 million, or $0.28 per share, for the same period of 1998. For the third quarter ended September 30, 1999, the net loss included a gain of $0.7 million from the sale of certain rights to the Company's Impress Softpatch Impress™ Softpatch UroMed incontinence patch Urogynecology A foam pad worn externally to help prevent urine leakage in ♀ with stress incontinenc. See Stress incontinence. technology and assets to Procter & Gamble. For the third quarter ended September 30, 1998, net income included an extraordinary gain of $4.9 million resulting from the company's repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. , at a discount, of a portion of its outstanding 6% Convertible Subordinated Notes due October 15, 2003 (the "Notes"). UroMed reported a net loss of $3.7 million, or $0.70 per share, for the nine months ended September 30, 1999, compared with a net loss of $10.1 million, or $1.91 per share, for the same period of 1998. The net loss for the nine months ended September 30, 1999 included a gain of $0.7 million from the sale of certain rights to the Company's Impress Softpatch technology and assets and an extraordinary gain of $0.7 million resulting from the Company's repurchase, at a discount, of a portion of its Notes. The net loss for the nine months ended September 30, 1998 included an extraordinary gain of $4.9 million resulting from the Company's repurchase, at a discount, of a portion of its Notes. COMPANY COMMENTS John G. Simon, UroMed's chairman of the board and chief executive officer, commented, "We are pleased to report a quarter of revenue growth. We are also pleased that we are continuing to make progress on reducing our operating losses operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the . In addition to financial progress, this quarter was marked by milestones achieved for our CaverMap CaverMap™ Urology A device that maps and locates the cavernosal nerve filaments during radical prostatectomy, helping preserve the nerve bundles, when feasible, in an attempt to maintain Pt potency and continence. Cf Prostate cancer, Radical prostatectomy. Surgical Aid and Symmetra Symmetra™ Radiation oncology A 125I radiation seed used for brachytherapy for localized prostate CA. See Prostate cancer. (TM) I-125 brachytherapy brachytherapy /brachy·ther·a·py/ (-ther´ah-pe) treatment with ionizing radiation whose source is applied to the surface of the body or within the body a short distance from the area being treated. seed. This quarter's modest revenue growth was primarily due to an increase in revenues of our CaverMap Surgical Aid for prostate cancer prostate cancer, cancer originating in the prostate gland. Prostate cancer is the leading malignancy in men in the United States and is second only to lung cancer as a cause of cancer death in men. surgery during the summer months. We are pleased with the growth of our CaverMap account base during the third quarter, as we ended the quarter with more than 80 hospital accounts who have access to the CaverMap Surgical Aid technology. A variety of studies and articles on CaverMap, including a Current Surgical Techniques in Urology urology Medical specialty dealing with the urinary system and male reproductive organs. It traces its origin to medieval lithologists, itinerant healers who specialized in surgical removal of bladder stones. publication by Dr. Carl A. Olsson of Columbia University Columbia University, mainly in New York City; founded 1754 as King's College by grant of King George II; first college in New York City, fifth oldest in the United States; one of the eight Ivy League institutions. , has benefited our growing account base. This piece, which was published in May 1999 and widely released to the medical community during the third quarter of 1999, highlights the procedural techniques and potential benefits of using the CaverMap Surgical Aid." "On the brachytherapy front, the Company commenced customer shipments of its FDA-cleared Symmetra (TM) I-125 brachytherapy seed during the third quarter. We are currently engaged in a planned limited market release of our Symmetra seeds, with our first shipments and the first brachytherapy procedures using our seeds having begun in the third quarter. Customer feedback to date on Symmetra, and its potential advantages, has been quite positive. Nonetheless, we are still in our start up phase, with limited quantities of our seeds available from our German partner, Bebig, as a result of initial scale-up issues. This start-up Start-up The earliest stage of a new business venture. phase includes the limited market release of the seeds in addition to the gathering of customer feedback on the seed design and performance measures. As this phase concludes and additional larger quantities of our seeds become available, expected in or near the first quarter of 2000, we hope to see an increase in quarterly brachytherapy seed customer shipments and related procedures." Simon continued, "Our efforts to pursue third-party arrangements to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. existing products and/or product technology continued to yield value, as shown by our Impress Procter & Gamble transaction which closed on July 21, 1999. Pursuant to this transaction, the Company sold certain global rights to its Impress Softpatch technology and assets to Procter & Gamble for $3.3 million in cash at closing and $0.6 million in cash payments to be received over a four-year period as well as some potential additional cash consideration. This transaction resulted in a $0.7 million gain in the third quarter of 1999. We believe this transaction is attractive for UroMed shareholders because it (1) provides immediate cash proceeds, (2) allows us to maintain rights for this technology in the prescription market for other potential licensees or technology acquirers and (3) enables us to receive some benefit from our consumer technology without diluting our focus from our growing prostate cancer business. This transaction, along with the April 1999 spin-off The situation that arises when a parent corporation organizes a subsidiary corporation, to which it transfers a portion of its assets in exchange for all of the subsidiary's capital stock, which is subsequently transferred to the parent corporation's shareholders. of Assurance Medical Inc, marks an important milestone for the Company, and fosters our ability to further streamline our operations and focus on prostate cancer markets." Most importantly Adv. 1. most importantly - above and beyond all other consideration; "above all, you must be independent" above all, most especially , over the remainder of 1999 and into 2000, we hope to continue our momentum to make sequential progress in our operating performance and further enhance our efforts in the treatment of prostate cancer to lay the foundation for growth in 2000 and beyond," concluded Simon. COMPANY MISSION UroMed is dedicated to establishing itself as a leader in providing interventional urological products, with primary emphasis on the treatment of prostate cancer. The Company seeks to market a portfolio of products including its two main proprietary products for the treatment of prostate cancer: the CaverMap (TM) Surgical Aid, available to aid physicians in preserving vital nerves during prostate cancer surgery, and the Symmetra (TM) I-125 radioactive seeds I-125 radioactive seed Radiation oncology A small radioactive seed implanted into the prostate under ultrasound guidance for treating prostate CA–brachytherapy. See Ultrasound-guided transperineal permanent palladium-103 implantation of prostate. , used in brachytherapy procedures to treat localized Translated into the spoken language of the country. See localization. prostate cancer. The Company also markets brachytherapy introducer needles and minimally invasive invasive /in·va·sive/ (-siv) 1. having the quality of invasiveness. 2. involving puncture of the skin or insertion of an instrument or foreign material into the body; said of diagnostic techniques. incontinence incontinence Inability to control excretion. Starting and stopping urination relies on normal function in pelvic and abdominal muscles, diaphragm, and control nerves. Babies' nervous systems are too immature for urinary control. Later incontinence may reflect disorders (e.g. surgical products. UroMed, through its approximate one-third ownership of Assurance Medical Inc., has supported the development of electronic palpation palpation /pal·pa·tion/ (pal-pa´shun) the act of feeling with the hand; the application of the fingers with light pressure to the surface of the body for the purpose of determining the condition of the parts beneath in physical diagnosis. technology in order to aid physicians and patients in the important mission of finding suspicious breast lumps breast lump Breast mass, see there earlier. The Company has also developed technology and assets in office-based incontinence products; the Company continues its efforts to leverage its technology and assets in this area via corporate partnerships and/or strategic alliances. UroMed also continues to dedicate ded·i·cate tr.v. ded·i·cat·ed, ded·i·cat·ing, ded·i·cates 1. To set apart for a deity or for religious purposes; consecrate. 2. resources to the development and/or acquisition of product lines that fit into its strategic platform. RISK FACTORS AND FORWARD-LOOKING STATEMENTS forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. The Company recognizes that the previous paragraphs contain forward-looking statements relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the Company's future activities, including development and commercialization of the company's CaverMap(TM) Surgical Aid and Symmetra(TM) I-125 radioactive seeds, and future growth. These forward-looking statements are based largely on the Company's expectations and are subject to a number of risks and uncertainties beyond the Company's control. Actual results could differ materially from these forward-looking statements as the result of certain risks, including the risk that physicians will not use its products in significant numbers, the risk that physicians using its products will not develop into long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. users, the Company's ability to successfully reduce costs, the uncertainty of securing additional alliances, the uncertainty of manufacturing scale-up and general market acceptance of the Company's Symmetra I-125 radioactive seeds, and the CaverMap Surgical Aid , as well as the Company's dependence on these products going forward, and the risk that the Company will not be able to successfully develop any new products. There can be no assurance that these risks would not have a material adverse effect on the company. Other relevant risks are described in the Company's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 1998, under the headings "Forward-Looking Statements and Associated Risks" and "Risk Factors," which are incorporated herein by reference. Impress (R) Softpatch is a registered trademark of UroMed Corporation. CaverMap (TM) Surgical Aid and Symmetra (TM) I-125 Seeds are trademarks of UroMed Corporation. -0-
UROMED CORPORATION
CONDENSED STATEMENT OF OPERATIONS
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
1999 1998 1999 1998
(In thousands, except per share data)
Revenues $719 $271 $1,837 $452
Costs and expenses:
Cost of revenues 608 809 1,949 2,811
Research and development 445 1,067 1,784 4,443
Marketing and sales 505 720 1,547 3,636
General and administrative 364 682 1,387 2,591
Restructuring -- -- (80) 1,024
Total costs and expenses 1,922 3,278 6,587 14,505
Loss from operations (1,203) (3,007) (4,750) (14,053)
Gain on sale of assets 672 -- 672 --
Interest income 297 730 877 2,394
Interest expense (385) (1,077) (1,176) (3,345)
Loss before extraordinary
gain on early retirement
of debt (619) (3,354) (4,377) (15,004)
Extraordinary gain on
early retirement of debt -- 4,865 701 4,865
Net Income (loss) (619) 1,511 (3,676) (10,139)
Basic and diluted per
share amounts:
Loss before extraordinary
gain on early retirement
of debt $(.12) $(.63) $(.84) $(2.83)
Extraordinary gain on early
retirement of debt -- 0.91 .14 0.92
Net Income (loss) $(.12) $0.28 $(.70) $(1.91)
Basic and diluted weighted
average common shares
outstanding 5,177 5,323 5,181 5,303
UROMED CORPORATION
CONDENSED BALANCE SHEET
(unaudited)
Sept. 30, Dec. 31,
1999 1998
(In thousands)
Assets
Current assets:
Cash and cash equivalents $6,895 $11,576
Short-term investments 16,278 14,704
Accounts receivable 537 224
Inventories 660 422
Prepaid expenses and other assets 510 640
Total current assets 24,880 27,566
Fixed assets, net 209 4,414
Other assets 2,137 1,626
$27,226 $33,606
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $114 $250
Accrued expenses 1,859 3,026
Total current liabilities 1,973 3,276
Convertible subordinated notes 23,406 24,756
Stockholders' equity 1,847 5,574
$27,226 $33,606
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