NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 1. Organization, Use of Estimates and Basis of Presentation
Champions Oncology, Inc. (the “Company”) is engaged in the development and sale of advanced technology solutions and products to personalize the development and use of oncology drugs. The Company’s TumorGraft Technology Platform is a novel approach to personalizing cancer care based upon the implantation of human tumors in immune-deficient mice. The Company uses this technology, in conjunction with related services, to offer solutions for two consumer groups: Personalized Oncology Solutions (“POS”) and Translational Oncology Solutions (“TOS”). POS assists physicians in developing personalized treatment options for their cancer patients through tumor specific data obtained from drug panels and related personalized oncology services. The Company’s TOS business offers a technology platform to pharmaceutical and biotechnology companies using proprietary TumorGraft studies, which the Company believes may be predictive of how drugs may perform in clinical settings.
The Company has
two
operating subsidiaries: Champions Oncology (Israel), Limited and Champions Biotechnology U.K., Limited. Champions Oncology Singapore, PTE LTD was closed on November 7, 2016 and had no material operations during the nine months ended January 31, 2017 and year ended April 30, 2016. For the
three and nine months ended January 31, 2017
and
2016
, there were no material revenues earned by these subsidiaries.
The Company’s foreign subsidiaries functional currency is the U.S. dollar. Transaction gains and losses are recognized in earnings. The Company is subject to foreign exchange rate fluctuations in connection with the Company’s international operations.
These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission, or the SEC. All significant intercompany transactions and accounts have been eliminated. Certain information related to the Company’s organization, significant accounting policies and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States, or GAAP, has been condensed or omitted. The accounting policies followed in the preparation of these unaudited condensed consolidated financial statements are consistent with those followed in the Company’s annual consolidated financial statements for the year ended
April 30, 2016
, as filed on Form 10-K. In the opinion of management, these unaudited condensed consolidated financial statements contain all material adjustments necessary to fairly state our financial position, results of operations and cash flows for the periods presented and the presentations and disclosures herein are adequate when read in conjunction with the Company’s Annual Report on Form 10-K for the year ended
April 30, 2016
.
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Liquidity
Our liquidity needs have typically arisen from the funding of our research and development programs and the launch of new products, working capital requirements, and other strategic initiatives. In the past, we have met these cash requirements through our sales of products and services, working capital management, and proceeds from certain private and public offerings of our securities. For the
nine
months ended
January 31, 2017
, we had a net loss of
$4.5 million
and net operating cash outflows of
$3.2 million
. In addition, as of
January 31, 2017
, we had positive working capital of
$783,000
and cash and cash equivalents on hand of
$3.5 million
. We have grown our revenues while undertaking significant cost reductions beginning in the fourth quarter of fiscal year 2016, which has reduced our net loss and use of cash in operations for the nine months ended
January 31, 2017
compared to the same period in the prior year by
$3.4 million
and
$2.6 million
, respectively. For the three months ended January 31, 2017, our net loss and use of cash in operations was approximately
$1.4 million
and $
684,000
, respectively.
W
e believe that our cash and cash equivalents on hand at
January 31, 2017
are adequate to fund our operations through at least March 2018.
However, in order for us to continue our operations beyond March 2018, we need to continue to increase revenues and generate cost savings from operations. In addition, we may need to obtain capital from external sources. If we are unable to maintain our operating levels and cannot obtain additional financing, we may be required to reduce the scope of, or delay or eliminate, some of our research and development and other activities, which could harm our financial condition and operating results. Financing may not be available on acceptable terms or at all, and our failure to raise capital when needed could negatively impact our growth plans and our financial condition and results of operations.
Reverse Stock Split
On October 15, 2013, the shareholders of the Company authorized our Board of Directors to effect a reverse stock split of all outstanding shares of common stock, warrants and options. The Board of Directors subsequently approved the implementation of a reverse stock split at a ratio of one-for-twelve shares, which became effective on August 12, 2015. All share and per share data relating to
January 31, 2016
in these condensed consolidated financial statements and related notes hereto have been adjusted to account for the effect of the reverse stock split.
Earnings Per Share
Basic net loss per share is computed by dividing the net loss for the period by the weighted-average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing the net loss for the period by the weighted-average number of shares of common stock plus dilutive potential common stock considered outstanding during the period. Such dilutive shares consist of incremental shares that would be issued upon exercise of the Company’s common stock purchase warrants and stock options. For the
three and nine months ended January 31, 2017
and
2016
, basic and dilutive loss per share were the same, as the potentially dilutive securities did not have a dilutive effect.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
January 31,
|
|
Nine Months Ended
January 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Basic and diluted net loss per share computation:
|
|
|
|
|
|
|
|
|
|
Net loss attributable to common stockholders
|
$
|
(1,408,904
|
)
|
|
$
|
(2,412,381
|
)
|
|
$
|
(4,459,773
|
)
|
|
$
|
(7,872,115
|
)
|
Weighted Average common shares – basic
|
10,967,738
|
|
|
8,702,237
|
|
|
10,130,460
|
|
|
8,702,237
|
|
Basic and diluted net loss per share
|
$
|
(0.13
|
)
|
|
$
|
(0.28
|
)
|
|
$
|
(0.44
|
)
|
|
$
|
(0.90
|
)
|
The following table reflects the total potential share-based instruments outstanding at
January 31, 2017
and
2016
that could have an effect on the future computation of dilution per common share:
|
|
|
|
|
|
|
|
January 31,
|
|
2017
|
|
2016
|
Stock options
|
2,308,704
|
|
|
2,212,571
|
|
Warrants
|
2,109,840
|
|
|
2,109,840
|
|
|
|
|
|
Total common stock equivalents
|
4,418,544
|
|
|
4,322,411
|
|
Income Taxes
Deferred income taxes have been provided to show the effect of temporary differences between the recognition of expenses for financial and income tax reporting purposes and between the tax basis of assets and liabilities, and their reported amounts in the consolidated financial statements. In assessing the realizability of deferred tax assets, the Company assesses the likelihood that deferred tax assets will be recovered through tax planning strategies or from future taxable income, and to the extent that recovery is not likely or there is insufficient operating history, a valuation allowance is established. The Company adjusts the valuation allowance in the period management determines it is more likely than not that net deferred tax assets will or will not be realized. Changes in valuation allowances from period to period are included in the tax provision in the period of change. As of
January 31, 2017
and
2016
, the Company provided a valuation allowance for all net deferred tax assets, as recovery is not more likely than not based on an insufficient history of earnings.
Tax positions are positions taken in a previously filed tax return or positions expected to be taken in a future tax return that are reflected in measuring current or deferred income tax assets and liabilities reported in the consolidated financial statements. Tax positions include, but are not limited to, the following:
|
|
•
|
An allocation or shift of income between taxing jurisdictions;
|
|
|
•
|
The characterization of income or a decision to exclude reportable taxable income in a tax return; or
|
|
|
•
|
A decision to classify a transaction, entity or other position in a tax return as tax exempt.
|
The Company reflects tax benefits only if it is more likely than not that we will be able to sustain the tax position, based on its technical merits. If a tax benefit meets this criterion, it is measured and recognized based on the largest amount of benefit that is cumulatively greater than 50% likely to be realized. The Company has recorded
$185,000
and
$165,000
of liabilities related to uncertain tax positions relative to one of its foreign operations as of
January 31, 2017
and
April 30, 2016
, respectively.
The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company had no accrual for interest or penalties on the Company’s balance sheets at
January 31, 2017
and
April 30, 2016
, and has not recognized interest and/or penalties in the statement of operations for either period. We do not anticipate any significant unrecognized tax benefits will be recorded during the next 12 months.
The income tax provision for the
nine months ended January 31, 2017
and
2016
was
$7,000
and
$76,000
, respectively.
Note 2. Property and Equipment
Property and equipment is recorded at cost and primarily consists of laboratory equipment, leasehold improvements, furniture and fixtures, and computer equipment and software. Depreciation and amortization is calculated on a straight-line basis over the estimated useful lives of the various assets ranging from three to seven years. Property and equipment consisted of the following (table in thousands):
|
|
|
|
|
|
|
|
|
|
January 31,
2017
|
|
April 30,
2016
|
|
(unaudited)
|
|
|
Furniture and fixtures
|
$
|
74
|
|
|
$
|
73
|
|
Computer equipment and software
|
857
|
|
|
715
|
|
Laboratory equipment
|
820
|
|
|
782
|
|
Leasehold improvements
|
2
|
|
|
2
|
|
|
|
|
|
Total property and equipment
|
1,753
|
|
|
1,572
|
|
Less: Accumulated depreciation
|
(1,081
|
)
|
|
(954
|
)
|
|
|
|
|
Property and equipment, net
|
$
|
672
|
|
|
$
|
618
|
|
Depreciation and amortization expense, excluding expense recorded under capital lease, was
$34,000
and
$31,000
for the
three months ended January 31, 2017
and
2016
, respectively, and $
108,000
and $
95,000
for the
nine months ended January 31, 2017
and
2016
, respectively. As of
January 31, 2017
and
April 30, 2016
, property, plant and equipment included assets held under capital lease of
$124,000
. Related depreciation expense was
$6,000
and
$6,000
, respectively, for the
three months ended January 31, 2017
and
2016
, and $
19,000
and $
19,000
for the
nine months ended January 31, 2017
and
2016
, respectively.
Capital Lease
In November 2014, the Company entered into a capital lease for laboratory equipment. The lease has costs of approximately
$149,000
and matures on November 2019. The current monthly capital lease payment is approximately
$3,000
.
The following is a schedule by years of future minimum lease payments under this capital lease together with the present value of the net minimum lease payments as of
January 31, 2017
(table in thousands):
|
|
|
|
|
For the Years Ended April 30,
|
Total
|
2017 (remaining)
|
$
|
6
|
|
2018
|
25
|
|
2019
|
27
|
|
2020
|
16
|
|
|
|
|
Total minimum payments
|
74
|
|
Less: amount representing interest
|
(6
|
)
|
Present value of minimum payments
|
68
|
|
Less: current portion
|
(25
|
)
|
|
$
|
43
|
|
The present value of minimum future obligations shown above is calculated based on an interest rate of
5%
. The short-term and long-term components of the capital lease obligation are included in accrued liabilities and other non-current liabilities, respectively at
January 31, 2017
and
April 30, 2016
.
Note 3. Share-Based Payments
The Company has in place a 2010 Equity Incentive Plan and a 2008 Equity Incentive Plan. In general, these plans provide for stock-based compensation in the form of (i) Non-statutory Stock Options; (ii) Restricted Stock Awards; and (iii) Stock Appreciation Rights to the Company’s employees, directors and non-employees. The plans also provide for limits on the aggregate number of shares that may be granted, the term of grants and the strike price of option awards.
Stock-based compensation in the amount of
$237,000
and
$567,000
was recognized for the
three months ended January 31, 2017
and
2016
, respectively, and $
1.9 million
and $
2.1 million
for the
nine months ended January 31, 2017
and
2016
, respectively. Stock-based compensation expense was recognized as follows (table in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
January 31,
|
|
Nine Months Ended
January 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
General and administrative
|
$
|
184
|
|
|
$
|
488
|
|
|
$
|
1,482
|
|
|
$
|
1,600
|
|
Sales and marketing
|
7
|
|
|
27
|
|
|
194
|
|
|
173
|
|
Research and development
|
44
|
|
|
49
|
|
|
174
|
|
|
262
|
|
TOS cost of sales
|
2
|
|
|
2
|
|
|
49
|
|
|
28
|
|
POS cost of sales
|
—
|
|
|
1
|
|
|
2
|
|
|
27
|
|
Total stock-based compensation expense
|
$
|
237
|
|
|
$
|
567
|
|
|
$
|
1,901
|
|
|
$
|
2,090
|
|
Stock Option Grants
Black-Scholes assumptions used to calculate the fair value of options granted during the
three and nine months ended January 31, 2017
and
2016
were as follows:
|
|
|
|
|
|
|
|
|
|
Three Months Ended
January 31,
|
|
Nine Months Ended
January 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Expected term in years
|
3
|
|
2.5 - 6
|
|
3 - 6
|
|
2.5 - 6
|
Risk-free interest rates
|
0.59% - 1.90%
|
|
0.995% - 1.75%
|
|
0.59% - 1.90%
|
|
0.995% - 1.77%
|
Volatility
|
72.12% - 87.96%
|
|
82.72% - 91.98%
|
|
72.12% - 87.96%
|
|
82.72% - 92.32%
|
Dividend yield
|
—%
|
|
—%
|
|
—%
|
|
—%
|
The weighted average fair value of stock options granted during the
three months ended January 31, 2017
and
2016
was
$1.35
and
$3.12
, respectively. The weighted average fair value of stock options granted during the
nine months ended January 31, 2017
and
2016
was $
1.71
and $
3.6
, respectively. The Company’s stock options activity for the
nine months ended January 31, 2017
was as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-
Employees
|
|
Directors
and
Employees
|
|
Total
|
|
Weighted
Average
Exercise
Price
|
|
Weighted
Average
Remaining
Contractual
Life (Years)
|
|
Aggregate
Intrinsic
Value
|
Outstanding, May 1, 2016
|
51,250
|
|
|
2,161,507
|
|
|
2,212,757
|
|
|
$
|
5.58
|
|
|
6.1
|
|
$
|
10,000
|
|
Granted
|
—
|
|
|
2,420,681
|
|
|
2,420,681
|
|
|
1.99
|
|
|
7.0
|
|
6,688,000
|
|
Exercised
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
Forfeited
|
—
|
|
|
(421,487
|
)
|
|
(421,487
|
)
|
|
2.03
|
|
|
|
|
|
|
Canceled
|
—
|
|
|
(1,793,779
|
)
|
|
(1,793,779
|
)
|
|
4.92
|
|
|
|
|
|
Expired
|
(1,250
|
)
|
|
(108,218
|
)
|
|
(109,468
|
)
|
|
7.86
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outstanding, January 31, 2017
|
50,000
|
|
|
2,258,704
|
|
|
2,308,704
|
|
|
2.76
|
|
|
6.6
|
|
$
|
6,201,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vested and expected to vest as of January 31, 2017
|
50,000
|
|
|
2,258,704
|
|
|
2,308,704
|
|
|
2.76
|
|
|
6.6
|
|
$
|
6,201,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exercisable as of January 31, 2017
|
33,336
|
|
|
1,954,383
|
|
|
1,987,719
|
|
|
2.97
|
|
|
6.0
|
|
$
|
4,672,000
|
|
Included in the forfeited balance in the table above are
203,043
options (which vest based on performance criteria) granted to each of the Company’s Chief Executive Officer and its President as of November 5, 2013 as part of their employment agreements. Performance-based options are expensed on an accelerated basis once the Company determines it is probable that the performance-based conditions will be met. It was determined the performance conditions will not be set and as such the
203,043
options have been forfeited. Additionally, included in the forfeited balance in the table above are
209,383
options which were granted to the previous CEO as part of his yearly compensation beginning in November 2016. The CEO has transitioned to Chairman of the Board of Directors as of January 31, 2017.
On July 21, 2016, the Company and certain members of its senior management team agreed to exchange existing options to purchase shares of the Company's common stock with new options. The new options have a lower exercise price for fewer shares and have the same vesting schedules and the same termination expiration dates as the existing options. The Company used the Black Scholes valuation method to determine if the modification created additional stock option expense. As a result of the option exchange, an aggregate of
1,793,781
existing options with exercise prices ranging from
$4.55
to
$6.96
per share were exchanged for an aggregate of
1,568,191
new options with exercise prices of
$2.10
per share. Due to the modification the Company had an additional stock option expense of
$414,756
,
$330,945
of which was recognized in the first quarter ended July 31, 2016,
38,590
which was recognized in the second quarter ended October 31, 2016,
$3,289
which was recognized in the third quarter ended January 31, 2017 and
$41,932
of which will be recognized over the next year and a half as the options continue to vest.
Stock Purchase Warrants
As of
January 31, 2017
and
April 30, 2016
, the Company had warrants outstanding for the purchase of
2,109,840
shares of its common stock, all of which were exercisable. Activity related to these warrants, which expire at various dates through March 2020, is summarized as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number
of
Shares
|
|
Weighted
Average
Exercise
Price
|
|
Weighted
Average
Remaining
Contractual
Life (Years)
|
|
Aggregate
Intrinsic
Value
|
Outstanding, May 1, 2016
|
2,109,840
|
|
|
$
|
5.54
|
|
|
3.6
|
|
|
$
|
—
|
|
Granted
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Exercised
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Expired
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
Outstanding, January 31, 2017
|
2,109,840
|
|
|
$
|
5.54
|
|
|
2.9
|
|
|
$
|
—
|
|
Note 4. Common Stock
On June 15, 2016, the Company closed a public offering ("The June 2016 Public Offering") of
2,000,000
registered shares of its common stock, par value
$0.001
per share, at an offering price of
$2.25
per share. In addition, the underwriter exercised a partial exercise of the over-allotment option granted to the underwriter to purchase an additional
258,749
shares of its common stock at the public offering price. All of the shares have been offered by the Company.
The net proceeds from The June 2016 Public Offering, including the partial exercise of the over-allotment option, was
$4.3 million
, after deducting the underwriting discount and offering-related expenses of
$742,000
. The Company intends to use the net proceeds of this offering for research and development to grow the TumorGraft platform, and the balance of the net proceeds for working capital and general corporate purposes.
The Company issued
3,247
shares valued at
$11,852
on January 24, 2017 and
3,896
shares valued at
$8,688
on July 6, 2016 of common stock in relation to consulting services.
Note 5. Related Party Transactions
Related party transactions include transactions between the Company and its shareholders, management, or affiliates. The following transactions were in the normal course of operations and were measured and recorded at the exchange amount, which is the amount of consideration established and agreed to by the parties.
Consulting Services
During the
nine months ended January 31, 2017
and
2016
, the Company paid a member of its Board of Directors
$54,000
and
$54,000
, respectively, for consulting services unrelated to his duties as a board member. During the
nine months ended January 31, 2017
and
2016
, the Company paid an affiliate of a board member $
22,000
and
$8,800
, respectively, for consulting services unrelated to their duties as board members. In addition, the Company issued
45,000
stock options to a member of its Board of Directors with a fair value of
$94,132
for consulting services unrelated to his duties as a board member. All of the amounts paid to these related parties have been recognized and expensed in the period the services were performed. As of
January 31, 2017
, no amounts were due to these related parties.
Note 6. Commitments and Contingencies
Operating Leases
The Company currently leases its office facilities. Rent expenses totaled
$297,000
and
$216,000
for the
nine months ended January 31, 2017
and
2016
, respectively. The Company considers its facilities adequate for our current operational needs.
The Company leases the following facilities under non-cancelable operating lease agreements:
|
|
•
|
One University Plaza, Suite 307, Hackensack, New Jersey 07601, which, since November 2011, serves as the Company’s corporate headquarters. The lease expires in
November 2021
. The Company recognized
$64,000
of rental costs relative to this lease for each of the
nine months ended January 31, 2017
and
2016
, respectively.
|
|
|
•
|
855 North Wolfe Street, Suite 619, Baltimore, Maryland 21205, which consists of laboratories and office space where the Company conducts operations related to its primary service offerings. This lease expires
December 2017
. The Company recognized
$78,000
and
$65,000
of rental costs relative to this lease for the
nine months ended January 31, 2017
and
2016
, respectively.
|
|
|
•
|
450 East 29t
h
Street, New York, New York, 10016, which is a laboratory at which we implant tumors. The Company recognized
$155,000
and
$87,000
of rental expense for the
nine months ended January 31, 2017
and
2016
, respectively. The lease expires in
May 2017
and can be renewed by the Company for subsequent one year terms.
|
Legal Matters
The Company is not currently party to any legal matters to its knowledge. The Company is not aware of any other matters that would have a material impact on the Company’s financial position or results of operations.
Registration Payment Arrangements
The Company has entered into an Amended and Restated Registration Rights Agreement in connection with the March 2015 Private Placement and is discussed more fully in Note 7 in the Company’s Form 10-K for the fiscal year ended
April 30, 2016
. This Amended and Restated Registration Rights Agreement contains provisions that may call for the Company to pay penalties in certain circumstances. This registration payment arrangement primarily relates to the Company’s ability to file a registration statement within a particular time period, have a registration statement declared effective within a particular time period and to maintain the effectiveness of the registration statement for a particular time period. The Company has not accrued any liquidated damages associated with the Amended and Restated Registration Right Agreement as the Company has filed the required registration statement and anticipates continued compliance with the agreement.
Note 7. Teva Agreement
On July 30, 2013, the Company entered into an agreement with Teva Pharmaceutical Industries Ltd. (“Teva”), pursuant to which the Company agreed to conduct TumorGraft studies on multiple proprietary chemical compounds provided by Teva to determine the activity or response of these compounds in potential clinical indications. Under the agreement, Teva agreed to pay an upfront payment and, under certain conditions, pay the Company various amounts upon achieving certain milestones, based on the performance of the compounds in preclinical testing and dependent upon testing the compound in clinical settings and obtaining FDA approval. In addition, Teva agreed to pay the Company royalties on any commercialized products developed under the agreement. This agreement terminated a prior collaborative agreement between Cephalon, Inc., a wholly-owned subsidiary of Teva, and the Company. Revenue recognized related to this agreement for the
nine months ended January 31, 2017
and
2016
, was
$42,000
and
$48,000
, respectively. This agreement has been terminated and all work relating to the upfront payment has been completed.
Note 8. Fair Value
The carrying value of cash and cash equivalents, accounts receivable, prepaid expenses, deposits and other receivables, accounts payable, and accrued liabilities approximate their fair value based on the liquidity or the short-term maturities of these instruments. The fair value hierarchy promulgated by GAAP consists of three levels:
|
|
•
|
Level one
— Quoted market prices in active markets for identical assets or liabilities;
|
|
|
•
|
Level two
— Inputs other than level one inputs that are either directly or indirectly observable; and
|
|
|
•
|
Level three
— Unobservable inputs developed using estimates and assumptions, which are developed by the reporting entity and reflect those assumptions that a market participant would use.
|
Determining which category an asset or liability falls within the hierarchy requires significant judgment. The Company evaluates its hierarchy disclosures each quarter. The Company currently has no assets or liabilities measured at fair value on a recurring basis.
Note 9. Segment Information
The Company operates in two reportable segments, POS and TOS. The accounting policies of the Company’s segments are the same as those described in Note 2 of the Company’s annual financial statements for the year ended
April 30, 2016
, as filed on Form 10-K. The Company evaluates performance of its segments based on profit or loss from operations before stock compensation expense, depreciation and amortization, interest expense, interest income, gain on sale of assets, special charges or benefits, and income taxes (“segment profit”). Management uses segment profit information for internal reporting and control purposes and considers it in making decisions regarding the allocation of capital and other resources, risk assessment, and employee compensation, among other matters. The following tables summarize, for the periods indicated, operating results by reportable segment (table in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended January 31, 2017
|
|
Personalized
Oncology
Solutions
(POS)
|
|
Translational
Oncology
Solutions
(TOS)
|
|
Unallocated
Corporate
Overhead
|
|
Consolidated
|
Net revenue
|
|
$
|
347
|
|
|
$
|
3,218
|
|
|
$
|
—
|
|
|
$
|
3,565
|
|
Direct cost of services
|
|
(320
|
)
|
|
(2,084
|
)
|
|
—
|
|
|
(2,404
|
)
|
Sales and marketing costs
|
|
(128
|
)
|
|
(591
|
)
|
|
—
|
|
|
(719
|
)
|
Other operating expenses
|
|
—
|
|
|
(953
|
)
|
|
(653
|
)
|
|
(1,606
|
)
|
Stock- based compensation expense (1)
|
|
—
|
|
|
—
|
|
|
(237
|
)
|
|
(237
|
)
|
|
|
|
|
|
|
|
|
|
Segment profit (loss)
|
|
$
|
(101
|
)
|
|
$
|
(410
|
)
|
|
$
|
(890
|
)
|
|
$
|
(1,401
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended January 31, 2016
|
|
Personalized
Oncology
Solutions
(POS)
|
|
Translational
Oncology
Solutions
(TOS)
|
|
Unallocated
Corporate
Overhead
|
|
Consolidated
|
Net revenue
|
|
$
|
416
|
|
|
$
|
2,136
|
|
|
$
|
—
|
|
|
$
|
2,552
|
|
Direct cost of services
|
|
(479
|
)
|
|
(1,624
|
)
|
|
—
|
|
|
(2,103
|
)
|
Sales and marketing costs
|
|
(183
|
)
|
|
(569
|
)
|
|
—
|
|
|
(752
|
)
|
Other operating expenses
|
|
—
|
|
|
(950
|
)
|
|
(553
|
)
|
|
(1,503
|
)
|
Stock- based compensation expense (1)
|
|
—
|
|
|
—
|
|
|
(567
|
)
|
|
(567
|
)
|
|
|
|
|
|
|
|
|
|
Segment profit (loss)
|
|
$
|
(246
|
)
|
|
$
|
(1,007
|
)
|
|
$
|
(1,120
|
)
|
|
$
|
(2,373
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended January 31, 2017
|
|
Personalized
Oncology
Solutions
(POS)
|
|
Translational
Oncology
Solutions
(TOS)
|
|
Unallocated
Corporate
Overhead
|
|
Consolidated
|
Net revenue
|
|
$
|
1,354
|
|
|
$
|
10,337
|
|
|
$
|
—
|
|
|
$
|
11,691
|
|
Direct cost of services
|
|
(1,165
|
)
|
|
(5,916
|
)
|
|
—
|
|
|
(7,081
|
)
|
Sales and marketing costs
|
|
(397
|
)
|
|
(1,778
|
)
|
|
—
|
|
|
(2,175
|
)
|
Other operating expenses
|
|
—
|
|
|
(3,043
|
)
|
|
(1,911
|
)
|
|
(4,954
|
)
|
Stock- based compensation expense (1)
|
|
—
|
|
|
—
|
|
|
(1,901
|
)
|
|
(1,901
|
)
|
|
|
|
|
|
|
|
|
|
Segment profit (loss)
|
|
$
|
(208
|
)
|
|
$
|
(400
|
)
|
|
$
|
(3,812
|
)
|
|
$
|
(4,420
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended January 31, 2016
|
|
Personalized
Oncology
Solutions
(POS)
|
|
Translational
Oncology
Solutions
(TOS)
|
|
Unallocated
Corporate
Overhead
|
|
Consolidated
|
Net revenue
|
|
$
|
1,387
|
|
|
$
|
6,958
|
|
|
$
|
—
|
|
|
$
|
8,345
|
|
Direct cost of services
|
|
(1,634
|
)
|
|
(4,654
|
)
|
|
—
|
|
|
(6,288
|
)
|
Sales and marketing costs
|
|
(716
|
)
|
|
(1,800
|
)
|
|
—
|
|
|
(2,516
|
)
|
Other operating expenses
|
|
—
|
|
|
(2,755
|
)
|
|
(2,463
|
)
|
|
(5,218
|
)
|
Stock- based compensation expense (1)
|
|
—
|
|
|
—
|
|
|
(2,090
|
)
|
|
(2,090
|
)
|
|
|
|
|
|
|
|
|
|
Segment profit (loss)
|
|
$
|
(963
|
)
|
|
$
|
(2,251
|
)
|
|
$
|
(4,553
|
)
|
|
$
|
(7,767
|
)
|
(1) Stock compensation expense is shown separately and is excluded from direct costs of services, sales and marketing costs, and other operating expenses, as it is managed on a consolidated basis and is not used by management to evaluate the performance of its segments. See Note 3 for the allocation of stock compensation expense relative to the individual line items as it is reported on the Company's Consolidated Statements of Operations.
All of the Company’s revenue is recorded in the United States and substantially all of its long-lived assets are in the United States.