INTERLEUKIN GENETICS REPORTS FOURTH QUARTER AND YEAR END 2009 FINANCIAL RESULTS
03/25/2010
WALTHAM, MA — MARCH 25, 2010 - Interleukin Genetics, Inc. (NYSE Amex: ILI) today issued financial and operational results for its fiscal fourth quarter and full fiscal year ended December 31, 2009.
“2009 was a transformative year for Interleukin Genetics. We repositioned the company to focus completely on the emerging field of personalized medicine by divesting the Alan James Group supplement business and launching our own line of single condition genetic tests under the Inherent Health brand. Our new line of products includes a first-of-its kind genetic test for weight management and a test to help maintain bone health. We have generated strong interest in our Company and believe we are poised for market growth of our products in multiple areas.” said Interleukin Genetics CEO, Lewis H. Bender. “We remain steadfast in our commitment to continue driving towards partnerships in medical and consumer channels and promoting our clinical research in support of our products.”
2009 Corporate and Scientific Highlights
Launched Inherent Health Brand of Genetic Tests
Interleukin Genetics introduced its line of Inherent Health® genetic tests and related programs including the first-of-its-kind test for weight management that identifies an individual’s genetic tendencies for weight gain and metabolism. In addition, the Bone Health test was launched which reveals for individuals their risk for developing vertebral or spinal fractures and low bone mineral density associated with osteoporosis.
Chaired Panel Discussion on Use of Biomarkers in Drug Development at the BIO International Conference
Interleukin Genetics presented with other pharmaceutical and biotech companies during a panel discussion on the use of biomarkers in drug development.
Granted License of Heart Health Genetic Test to LABEC Pharma
Interleukin Genetics entered into a licensing agreement to permit LABEC Pharma to market and sell the Company’s Heart Health genetic test throughout Spain and Portugal.
Sold Alan James Group Business
Interleukin Genetics, Inc. executed an agreement to sell substantially all of the Alan James Group business and assets of our wholly-owned subsidiary AJG Brands, Inc. to Pep Products, Inc., a subsidiary of Nutraceutical Corporation.
Published Results from Clinical Study on Osteoarthritis
Interleukin Genetics and NYU Langone Medical Center announced findings from a study on the genetics of osteoarthritis were published online in the Annals of Rheumatic Diseases. Results from the study highlight the importance of the IL-1Ra gene as a likely determinant for whether patients with knee osteoarthritis will go on to develop a severe form of the disease.
Presented Findings at the IDF 20th World Diabetes Congress
Interleukin Genetics presented findings that suggest genetic polymorphisms in the perilipin, IL-1, ADRB and MCR-4 genes may predispose individuals to abnormal fat metabolism. These findings could have utility in the clinical management of obese patients.
Presented Findings at the Society of Human Genetics Annual Meeting
Interleukin Genetics presented findings that suggest variations in the IL1B, VDR, and ESR1 genes may indicate susceptibility for vertebral fracture or low bone mineral density. The findings could be valuable in guiding medical management of osteoporosis, design of clinical trials of investigational new drugs, as well as guiding preventive treatments for individuals at risk for the disease.
Presented Findings at the Annual Scientific Meeting of the Obesity Society
Interleukin Genetics presented findings which suggest that genetic polymorphisms in perilipin, IL-1 and ADRB genes show strong association with resistance to weight loss under caloric restriction. These genetic risk markers could have important clinical utility in the medical management of obese patients and in the design of optimal weight loss programs.
Completed a Clinical Study with Stanford University
The Company announced initial findings from a retrospective clinical study done in collaboration with researchers from Stanford University on weight management using patients who participated in a diet study previously reported in the Journal of the American Medical Association. The clinical study demonstrated that individuals following diets matched to their genotype, as determined by the Interleukin Genetics Weight Management Genetic Test, showed statistically significant greater weight loss and other benefits at all time points (2 months, 6 months and 12 months) when compared to individuals on diets not matched to their genotype.
2009 Financial Highlights
The Company reported revenues from continuing operations of $1.1 million and a net loss of $9.2 million, or $(0.29) per basic and diluted common share, for the year ended December 31, 2009, compared to revenues from continuing operations in 2008 of $2.6 million and a net loss of $6.9 million, or $(0.22) per basic and diluted common share. The revenue decrease is primarily attributable to decreases in contract research and royalty revenue offset by increased genetic testing revenue.
Research and development expenses were $3.2 million for the year ended December 31, 2009 compared to $3.6 million for the year ended December 31, 2008. The decrease is attributable to lower clinical trial expenses relating to the Company’s sponsored research agreement with Alticor, and lower consulting expenses offset by increased expenses relating to our patent portfolio.
Selling, general and administrative expenses from continuing operations were $5.6 million for the year ended December 31, 2009 compared to $5.0 million for the year ended December 31, 2008. The increase is primarily attributable to increased product development and advertising expenses for our Inherent Health brand of genetic tests and increased headcount, offset by decreased expenses related to administrative support consultants.
Fourth Quarter Results
Revenue from continuing operations for the three months ended December 31, 2009, was $0.2 million compared to $0.9 million for the same period in 2008. The revenue decrease is primarily attributable to decreases in contract research and royalty revenue offset by increased genetic testing revenue.
Research and development expenses were $0.6 million for the quarter ended December 31, 2009, compared to $1.1 million for the same period in 2008. The decrease was primarily attributable to decreased expenses relating to our sponsored research programs with Alticor, consulting expenses and decreased expenses related to our patent portfolio.
Selling, general and administrative expenses from continuing operations were $1.1 million for the three months ended December 31, 2009 and December 31, 2008. The change in expenses were primarily due to increased promotional and advertising expenses related to our Inherent Health brand of genetic tests offset by decreases in professional service fees.
The Company reported a net loss from continuing operations of $1.9 million, or $(0.06) per basic and diluted common share, for the fourth quarter of 2009, compared to $1.7 million or $(0.05) per basic and diluted common share for the same period in 2008.
As of December 31, 2009, the Company had cash and cash equivalents of $0.9 million compared to $5.0 million of cash and cash equivalents on December 31, 2008. In addition, as of December 31, 2009, the Company had access to $7.3 million under credit facilities with Pyxis Innovations Inc., an affiliate of Alticor, now extended through June 2011. The Company borrowed $2.0 million under this facility in February 2010, leaving $5.3 million of available credit.
March 2010 Equity Financing
On March 5, 2010, the Company entered into a definitive agreement with certain institutional investors to sell $5.3 million of securities in a registered direct offering. The investors purchased an aggregate of 4,375,002 units for $1.20 per unit, with each unit consisting of a share of common stock and a warrant to purchase 0.40 of a share of common stock. The warrants are exerciseable at $1.30 per share and expire in five years. Net proceeds to the Company after fees and expenses were approximately $4.9 million.
Conference Call and Webcast Information
Interleukin Genetics, Inc. will host a live conference call and webcast today at 4:30 p.m. EDT. To access the live call, dial 877-324-1976 (domestic) or 631-291-4550 (international). The live webcast will be available at the Investors section of the Company’s website, www.ilgenetics.com.
The webcast will be archived following the call at www.ilgenetics.com.
About Interleukin Genetics
Interleukin Genetics, Inc. (NYSE Amex: ILI) develops and markets genetic tests that empower consumers to prevent certain chronic diseases and that assist pharmaceutical companies in the development and marketing of targeted therapeutics. The Company leverages its research, intellectual property and biomarker development experience to facilitate the emerging personalized health market. Interleukin Genetics markets a line of genetic tests under the Inherent Health brand including Bone Health, Weight Management, Heart Health and Nutritional Needs. The Company is headquartered in Waltham, MA. For more information please visit www.ilgenetics.com.
Certain statements contained herein are “forward-looking” statements, including statements regarding the potential market growth of the Company’s products in multiple areas and the potential value and uses of the results of the Company’s genetic studies. 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, 2009 and other filings with the Securities and Exchange Commission. The Company disclaims any obligation or intention to update these forward-looking statements.
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Contacts:
Erin Walsh
Interleukin Genetics
781-419-4707
ewalsh@ilgenetics.com
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