The Medipattern Corporation
TSX VENTURE : MKI

The Medipattern Corporation

November 29, 2010 11:37 ET

Medipattern Reports Unaudited Results for Q1 2011

TORONTO, ONTARIO--(Marketwire - Nov. 29, 2010) - The Medipattern Corporation ("Medipattern") (TSX VENTURE:MKI), a pioneer in the development of medical software solutions that help improve imaging workflow and productivity, today announced its financial results for its first fiscal quarter of 2011 ended September 30, 2010.

Jeff Collins, CEO of Medipattern, commented, "Results for Q1 2011 remain much weaker than we anticipated due mainly to the ongoing reimbursement concerns in the US. Revenue for this new software as a service model started to flow in during the second quarter of fiscal 2010, and although B-CAD® procedural volume is growing quarter over quarter, revenue is not what we anticipated due to lower than expected reimbursement yield per report. Healthcare iQ is continuing to provide reimbursement advice to our customers and to manage denials from payers while gaining acceptance for the B-CAD® procedure. Through our relationship with GE Healthcare we welcome our first B-CAD® installation in Louisiana at the Baton Rouge Clinic. Celebrating 60 years of serving its community, the clinic offers screening and digital mammography, diagnostic breast ultrasound as well as biopsies and even surgical procedures. Baton Rouge Clinic will now include B-CAD® in their diagnostic ultrasound procedures. The clinic offers a full range of general and specialized medical procedures caring for over 250,000 patients per year. We have been working with our partner, PenRad Technologies Inc., to expand CAD for breast ultrasound into their existing installed base as part of our national roll out strategy. We will demonstrate an integrated B-CAD® system with PenRad® at RSNA in their PenView™ Mammography Review and Reporting Workstation. This will be the first Mammography Review Station to offer integrated CAD for Mammography, Ultrasound and MRI generating reports compliant with the American College of Radiology Breast Imaging Standards."

Collins also remarked, "Our entry into the vascular market remains expected in early calendar 2011 with the release of our Visualize:Vascular™ product." Francis Porreca MD, FACS RPVI, director of the Vascular Surgery and Vascular Laboratory at the Albert Einstein College of Medicine discussed his paper, "Carotid Plaque Morphology, New Horizons on Non-invasive Diagnosis," featuring Medipattern's new Visualize:Vascular™, at the November 17 - 21 Veith Symposium in New York City. Attendees consider the technology to be a useful new step in understanding vascular disease. We continue to believe we are providing solutions that fit a market need and will do everything possible to generate meaningful revenue in the latter half of fiscal 2011."

Financial Highlights for Q1 Fiscal 2011:

  • Revenue totaled $33,434 (Q1 2010 - $2,119) for the fiscal quarter ended September 30, 2010, a significant increase from last year. Licensing fees totaled $16,432 compared to $2,119 for fiscal 2010 while subscription rental fees increased to $17,002 (fiscal 2010 – nil) in the ongoing response to the North American roll out of the Company's B-CAD-FOR-LIFE™ subscription rental program. No professional fees were earned in Q1 fiscal 2011 (fiscal 2010 - Nil) as the Company remains focused on meeting its deadlines for completion of internal development and commercialization of its new vascular software Visualize:Vascular™ scheduled for early calendar 2011;

  • Operating expenses in Q1 fiscal 2011 totaled $607,099 versus $719,405 in last years' first fiscal quarter, an overall decline of 16%. Medipattern remains committed to preserving its cash resources and controlling all discretionary spending until operating cash flow improves in response to its ongoing commercialization of its award winning software products;

  • Resulting net loss for Q1 fiscal 2011 was $573,665 ($0.01 per share) versus $717,286 ($0.1 per share) for the 2010 Q1 fiscal quarter;

  • As at September 30, 2010, cash and cash equivalents totaled $143,398 (June 30, 2010 - $269,329), current assets, including highly liquid short-term investments of $1,050,000 (June 30, 2010 - $1,250,000), were $1,627,513 (June 30, 2010 - $2,070,913) and current liabilities were $369,293 (June 30, 2010 - $377,443).

Working capital at September 30, 2010 totaled $1,258,220 (June 30, 2010 - $1,693,470).

Results of Operations:  
   
THE MEDIPATTERN CORPORATION  
UNAUDITED STATEMENTS OF OPERATIONS, COMPREHENSIVE LOSS AND DEFICIT  
FOR THE 3 MONTHS ENDED SEPTEMBER 30, 2010 AND 2009  
   
   
   
  September 30,2010     September 30,2009  
  UNAUDITED     UNAUDITED  
  (3 Months)     (3 Months)  
   
REVENUES              
  Licensing fees $ 16,432     $ 2,119  
  Professional fees   -       -  
  Subscription rental fees   17,002       -  
    33,434       2,119  
   
EXPENSES              
  Research and development (Note 17)   230,064       220,578  
  Administration and product support   200,452       261,291  
  Sales and marketing   103,590       218,451  
  Interest on convertible debt (Note 10)   41,690       -  
  Accretion of interest on convertible debt (Note 10)   21,127       -  
  Foreign exchange loss   4,680       10,018  
  Investment income   (2,862 )     (1,280 )
  Amortization of property and equipment   8,358       10,347  
   
    607,099       719,405  
   
NET LOSS AND COMPREHENSIVE LOSS $ (573,665 )   $ (717,286 )
   
DEFICIT, BEGINNING OF YEAR $ (18,969,163 )   $ (16,348,417 )
   
  Net loss for the period   (573,665 )     (717,286 )
   
DEFICIT, END OF PERIOD $ (19,542,828 )   $ (17,065,703 )
   
   
LOSS PER SHARE (Note 13) - basic and diluted $ (0.01 )   $ (0.01 )
   
Weighted average number of common shares outstanding   57,154,579       54,432,357  

For further details concerning Medipattern's results, please see the Company's filings on SEDAR. (www.sedar.com).

2010 Upcoming Events:

  • RSNA (Radiological Society of North America), November 28 to December 2, 2010, Chicago, IL. Booth 4600

About The Medipattern Corporation:

Medipattern® (TSX VENTURE:MKI) is a pioneer in the development of medical software solutions that help improve imaging workflow and productivity. Our first-to-market, award-winning B-CAD® advances breast ultrasound computer aided detection (CAD) by streamlining workflow and organizing information into a comprehensive patient record. Medipattern uses its Cadenza™ CAD Technology to power the digital conversion in medical communications. B-CAD automatically creates fully digital standardized worksheets and reports that make every practice more efficient, productive and ultimately more effective. For more information, please visit the Company's website at: www.medipattern.com.

B-CAD™ and B-CAD MRI™ are trademarks of The Medipattern Corporation. Medipattern® is a registered mark of The Medipattern Corporation.

Forward-looking statements

This document contains forward-looking statements relating to Medipattern's performance, operations, or business environment. These statements are based on what we believe are reasonable assumptions given currently available information and our understanding of Medipattern's current activities. We have tried, whenever possible, to identify these forward- looking statements using words such as "anticipates,'' "believes,'' "estimates,'' "expects,'' "plans,'' "intends,'' "potential'', and similar expressions. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict or control. A number of factors could cause actual outcomes and results to differ materially from those expressed in forward-looking statements. These factors include but are not limited to those set forth in the Company's corporate filings, (posted at www.sedar.com). In addition, these forward- looking statements relate to the date on which they are made. The Company disclaims any intention or obligation to update or revise any forward-looking statements for any reason. Readers should not rely on forward-looking statements.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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