Chemokine Therapeutics Corp.
TSX : CTI
OTC Bulletin Board : CHKT

Chemokine Therapeutics Corp.

November 14, 2007 08:31 ET

Chemokine Therapeutics Announces Third Quarter 2007 Financial and Operating Results

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Nov. 14, 2007) - Chemokine Therapeutics Corp. (the "Company") (TSX:CTI)(OTCBB:CHKT), a biotechnology company developing chemokine-based therapies to treat cancer, blood disorders and vascular diseases, today announced the financial and operating results of the third quarter ended September 30, 2007.

Third Quarter Highlights:

- Patient recruitment of CTCE-9908 phase I/II clinical trial completed

- Three abstracts accepted for presentation at the Molecular Targets and Cancer Therapeutics International Conference

"With the CTCE-9908 phase I/II patient recruitment complete, we can now focus on preparations for the international phase II study which is planned for early next year," said C. Richard Piazza, Chairman and CEO of Chemokine Therapeutics.

Financial Results - Unaudited

(All amounts in U.S. dollars and in accordance with U.S. GAAP unless otherwise specified)

The Company incurred a net loss of $1,467,667 ($0.03 per share) for the three months ended September 30, 2007 compared to a net loss of $2,004,328 ($0.05 per share) for the three months ended September 30, 2006. The decrease in the net loss was principally caused by the decrease in research and development expenditures.

The Company had no revenues in the three months ended September 30, 2007, or in the three months ended September 30, 2006.

Research and development expenses include contract research, manufacturing, laboratory supplies, and staff salaries. Research and development expenses were $778,296 during the three months ended September 30, 2007, compared to $1,464,591 for the three months ended September 30, 2006. The decrease of $686,295 in research and development expenses in the comparative three month period was primarily attributable to reduced expenditures for CTCE-0214 of $355,394 relating to the deferral of dose escalation studies, $174,225 for CTCE-0324, $50,565 for CTCE-9908, and $106,111 for other research and development expenses.

Direct costs for CTCE-9908 were $483,181 for the three months ended September 30, 2007 compared to $533,746 for the three months ended September 30, 2006. The decrease of $50,565 was due to a decrease in preclinical studies.

Direct costs for CTCE-0214 were $57,769 for the three months ended September 30, 2007 compared to $413,163 for the three months ended September 30, 2006. The decrease of $355,394 in CTCE-0214 direct costs in the current period reflects a reduction of spending on preclinical studies in keeping with a progression to a clinical phase of development.

The Company expects that research and development expenses will increase in the future as and when it incurs costs for clinical trials. Completion dates and completion costs to bring a drug candidate to market vary significantly for each drug candidate given the nature of the clinical trials and the fact that more clinical trials may need to be conducted to advance a drug candidate based upon the results of each phase. In addition, the Company anticipates partnering with larger pharmaceutical companies to conduct and finance later stage clinical trials and therefore the timing of completion of the approval of a drug will likely not be within the Company's control. Based on these factors we cannot reasonably estimate the completion dates and completion costs required to gain regulatory approval of the compounds for sale. Drug candidates are required to successfully complete Phase III clinical trials before gaining regulatory approval for sale, which the drug candidates do not expect to occur for several years.

General and administrative expenses for the three months ended September 30, 2007 were $751,887, compared to $525,351 for the three months ended September 30, 2006. The increase of $226,536 was primarily in respect of increased salaries and travel expenditures.

Interest income was $26,483 for the three months ended September 30, 2007 compared with $93,938 for the three months ended September 30, 2006. The decrease of interest income of $67,455 was due to decreases in short-term investments and cash equivalents.

Foreign exchange gain was $140,360 for the three months ended September 30, 2007, compared to a loss of $14,643 in the three months ended September 30, 2006. These gains principally resulted from short-term investments and foreign currency transactions and the strengthening of other currencies against the US currency.

At September 30, 2007, the Company had approximately $1.8 million in cash and cash equivalents and short term investments on hand, compared to approximately $6.1 million as of December 31, 2006, a decrease of $4.3 million. Our working capital at September 30, 2007 was approximately $1.5 million, compared to approximately $5.9 million at December 31, 2006, a decrease of $4.4 million.

About Chemokine Therapeutics Corp. (TSX:CTI)(OTCBB:CHKT)

Chemokine Therapeutics is a product-focused biotechnology company developing drugs in the field of chemokines. Chemokines are a class of signaling proteins which play a critical role in the growth, differentiation, and maturation of cells necessary for fighting infection as well as tissue repair and regeneration. Chemokines also have an important role in cancer metastasis and growth. Chemokine Therapeutics is a leader in research in the field of chemokines and has several products in various stages of development.

Safe Harbor Statement under the U.S. Private Securities Litigation Reform Act of 1995: Statements in this document regarding management's future expectations, beliefs, goals, plans or prospects constitute forward-looking statements that involve risks and uncertainties, which may cause actual results to differ materially from the statements made. For this purpose, any statements that are contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, the words "believes", "anticipates", "plans", "intends", "will", "should", "expects", "projects", and similar expressions are intended to identify forward-looking statements. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause actual results, future circumstances, or events to differ materially from those projected in the forward-looking statements. These risks include, but are not limited to, those associated with the success of research and development programs, the regulatory approval process, competition, securing and maintaining corporate alliances, market acceptance of the Company's products, the availability of government and insurance reimbursements for the Company's products, the strength of the Company's intellectual property, the ability of the Company to obtain adequate financing to fund its operations, the potential dilutive effects of any financing, reliance on subcontractors and key personnel and other risks detailed from time-to-time in the Company's public disclosure documents and other filings with the U.S. Securities and Exchange Commission and Canadian securities regulatory authorities. Forward-looking statements are made as of the date hereof, and the Company disclaims any intention and has no obligation or responsibility, except as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.



CHEMOKINE THERAPEUTICS CORP.
(A Development Stage Company)
INTERIM CONSOLIDATED BALANCE SHEETS

September 30, December 31,
2007 2006
------------ ------------
(Unaudited) (Audited)

ASSETS

CURRENT ASSETS
Cash and cash equivalents $ 1,748,645 $ 4,446,668
Short-term investments 75,392 1,642,308
Amounts receivable 81,584 60,366
Prepaid expense and deposits 34,320 103,816
------------ ------------

TOTAL CURRENT ASSETS 1,939,941 6,253,158

PROPERTY AND EQUIPMENT, net 469,072 332,440

LICENSE COSTS, net 10,528 16,299

DEFERRED FINANCING COSTS 1,054,295 -

AMOUNT DUE FROM AFFILIATE 167,613 253,263
------------ ------------

$ 3,641,449 $ 6,855,160
------------ ------------
------------ ------------

LIABILITIES

CURRENT LIABILITIES
Accounts payable and accrued liabilities $ 467,747 $ 377,915
Current portion of capital lease obligation 13,932 12,392
------------ ------------

TOTAL CURRENT LIABILITIES 481,679 390,307

CAPITAL LEASE OBLIGATION - 8,722
------------ ------------

481,679 399,029
------------ ------------

COMMITMENTS

STOCKHOLDERS' EQUITY

PREFERRED STOCK
Authorized - 6,000,000 shares; par
value $ 0.001 per share
Issued and outstanding shares: September 30,
2007 and December 31, 2006 - Nil - -

COMMON STOCK
Authorized - 200,000,000 shares; par
value $ 0.001 per share at September 30,
2007 and 100,000,000 shares at December 31,
2006
Issued and outstanding shares: September 30,
2007 and December 31, 2006 - 42,183,748 42,184 42,184

ADDITIONAL PAID-IN CAPITAL 31,046,680 30,957,359

(DEFICIT) ACCUMULATED DURING THE DEVELOPMENT
STAGE (27,929,094) (24,543,412)
------------ ------------

3,159,770 6,456,131
------------ ------------

$ 3,641,449 $ 6,855,160
------------ ------------
------------ ------------

See notes to the interim consolidated financial statement on SEDAR or
EDGAR.


CHEMOKINE THERAPEUTICS CORP.
(A Development Stage Company)
INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Cumulative
from
inception
Three months ended Nine months ended on July 15,
September 30, September 30, 1998 to
--------------------- --------------------- September
2007 2006 2007 2006 30, 2007
---------- ---------- ---------- ---------- -----------

REVENUE $ - $ - $ - $ - $ 275,000
---------- ---------- ---------- ---------- -----------
EXPENSES
Research and
development 778,296 1,464,591 1,098,881 3,900,707 15,694,606
General and
administrative 751,887 525,351 2,541,487 2,215,003 12,795,083
Stock-based
compensation 26,747 38,734 89,321 110,965 647,440
Amortization of
license 1,924 1,923 5,771 5,770 40,075
Depreciation and
amortization of
property and
equipment 75,656 53,024 225,823 127,454 571,914
---------- ---------- ---------- ---------- -----------

1,634,510 2,083,623 3,961,283 6,359,899 29,749,118
---------- ---------- ---------- ---------- -----------
OTHER INCOME
Interest 26,483 93,938 125,867 255,190 728,345
Foreign exchange
gain (loss) 140,360 (14,643) 449,734 288,309 816,679
---------- ---------- ---------- ---------- -----------

166,843 79,295 575,601 543,499 1,545,024
---------- ---------- ---------- ---------- -----------

NET LOSS (1,467,667)(2,004,328)(3,385,682)(5,816,400)(27,929,094)
---------- ---------- ---------- ---------- -----------
NET LOSS PER
COMMON SHARE
FOR THE PERIOD -
BASIC AND DILUTED $ (0.03)$ (0.05)$ (0.08)$ (0.15)
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
WEIGHTED AVERAGE
NUMBER OF COMMON
SHARES
OUTSTANDING 42,183,748 42,183,748 42,183,748 38,776,069
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------

See notes to the interim consolidated financial statements on SEDAR or
EDGAR.


CHEMOKINE THERAPEUTICS CORP.
(A Development Stage Company)
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOW
(Unaudited)
Cumulative
from
inception
Three months ended Nine months ended on July 15,
September 30, September 30, 1998 to
----------------------- ----------------------- September
2007 2006 2007 2006 30, 2007
----------- ----------- ----------- ----------- ------------
CASH FLOW FROM
OPERATING
ACTIVITIES
Net loss $(1,467,667)$(2,004,328)$(3,385,682)$(5,816,400)$(27,929,094)
Adjustments
to reconcile
net cash
provided by
operating
activities
Depreciation
and
amortization 77,580 54,948 231,594 133,225 611,989
Common
shares
issued for
consulting
services - - - - 1,033,669
Warrants
issued for
consulting
services - - - - 404,842
Options
issued for
consulting
services - - - - 87,968
Stock-based
compensation 26,747 38,734 89,321 110,965 647,440
Decrease
(increase) in
Amounts
receivable (16,382) 15,745 (21,218) (44,395) (81,584)
Prepaid
expense
and
deposits 20,603 43,648 69,496 96,222 (34,320)
Increase
(decrease) in
Accounts
payable and
accrued
liabilities (446,733) (46,414) 89,832 (24,449) 467,747
Deferred
financing
cost (340,640) - (1,054,295) - (1,054,295)
----------- ----------- ----------- ----------- ------------

CASH PROVIDED
(USED) BY
OPERATING
ACTIVITIES (2,146,492) (1,897,667) (3,980,952) (5,544,832) (25,845,638)

----------- ----------- ----------- ----------- ------------
CASH FLOW FROM
FINANCING
ACTIVITIES
Stock issued
for cash - - - 7,489,823 31,647,476
Stock issued
for settlement
of debt - - - - 200,000
Offering costs - - - (426,228) (2,974,596)
Net advances
from (advances
to) affiliates 571,004 273,387 85,650 503,288 (120,795)
Capital lease
payments (2,495) (3,092) (7,182) (7,687) (20,718)
----------- ----------- ----------- ----------- ------------

CASH PROVIDED
(USED) BY
FINANCING
ACTIVITIES 568,509 270,295 78,468 7,559,196 28,731,367

----------- ----------- ----------- ----------- ------------
CASH FLOW FROM
INVESTING
ACTIVITIES
Cash held by
disposed
subsidiary - - - - (4,754)
Purchase of
investments (3,761) (3,535,287) (937,378)(10,185,725) (17,308,986)
Redemption of
investments - 4,303,483 2,504,294 7,023,252 17,233,595
Payment under
license
agreement - - - - (50,603)
Purchase of
property and
equipment (2,581) (6,483) (362,455) (153,295) (1,006,336)
----------- ----------- ----------- ----------- ------------

CASH PROVIDED
(USED) BY
INVESTING
ACTIVITIES (6,342) 761,713 1,204,461 (3,315,768) (1,137,084)

----------- ----------- ----------- ----------- ------------
INCREASE
(DECREASE)
IN CASH AND
CASH
EQUIVALENTS
DURING THE
PERIOD (1,584,325) (865,659) (2,698,023) (1,301,404) (1,748,645)

CASH AND CASH
EQUIVALENTS,
beginning of
period 3,332,970 3,283,418 4,446,668 3,719,163 -
----------- ----------- ----------- ----------- ------------

CASH AND CASH
EQUIVALENTS,
end of
period $ 1,748,645 $ 2,417,759 $ 1,748,645 $ 2,417,759 $ (1,748,645)
----------- ----------- ----------- ----------- ------------
----------- ----------- ----------- ----------- ------------

See notes to the interim consolidated financial statements on SEDAR or
EDGAR

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