Interleukin Genetics Reports Third Quarter 2014 Financial Results

Company Gains Additional Visibility and Recognition for PerioPredict™ Among Key Influencers at Medical and Investor Conferences

WALTHAM, Mass.--()--Interleukin Genetics, Inc. (OTCQB:ILIU) today announced financial and operational results for the third fiscal quarter ended September 30, 2014.

“Learned Lessons from Stakeholders – How Much do Economics Matter?”

“During the third quarter, we gained additional visibility and positive recognition among important influencers in dentistry and molecular diagnostics by participating in several key conferences, including the American Dental Association annual meeting, the American Academy of Periodontology annual meeting and the BTIG Inaugural Emerging Technologies in Healthcare Diagnostics Symposium,” said Dr. Kenneth Kornman, Chief Executive Officer of Interleukin Genetics. “We recognize the need to both increase utilization of PerioPredict™ among covered patients, while increasing the number of insurance payors who will cover this innovative genetic test. To that end, we continue to educate dental offices about the benefits of the test, and continue to advance discussions with several prominent dental insurance providers who are considering adding PerioPredict™ to their list of covered services. PerioPredict™ has been shown to be an effective tool to identify an individual’s risk for developing severe periodontal disease, which helps dental offices improve and personalize patient care, which will provide better health and reduce long-term costs.

Third Quarter 2014 Financial Results

Revenues for the quarter ended September 30, 2014, were $472,000, compared to $419,000 for the same period in 2013. The increase in total revenue is primarily attributable to the addition of breakage revenue and international sales royalties in 2014 and revenues from the PerioPredict™ test, offset in part by a reduction in revenues from the Inherent Health product lines.

Research and development expenses for the quarter ended September 30, 2014, were $242,000, compared to $161,000 for the same period in 2013. The increase is primarily attributable to increased compensation related to employee annual salary performance increases as well as separation payments.

Selling, general and administrative expenses for the quarter ended September 30, 2014, were $1.3 million, compared to $2.0 million for the same period in 2013. The decrease is primarily attributable to decreased expenses related to marketing activities for our PerioPredict™ test, decreased consulting and professional expenses and lower sales commissions paid to Amway Global as part of our Merchant Network and Channel Partner Agreement.

Net loss for the quarter ended September 30, 2014, was $1.5 million, or $(0.01) per basic and diluted common share, compared to $2.2 million or $(0.02) per basic and diluted common share for the same period in 2013.

Cash and cash equivalents were $2.6 million as of September 30, 2014, which is sufficient to fund the Company’s operations through February 2015.

Third Quarter 2014 Highlights

  • Received the 2014 DrBicuspid Dental Excellence Award for PerioPredict™: In October, PerioPredict™ received the DrBicuspid Dental Excellence Award for “Best New Hygienist Product,” and Dr. Kornman was presented with the award at the 2014 American Dental Association (ADA) Annual Meeting. The Dental Excellence Awards are based on votes cast by more than 50,000 dental professionals and recognize the very best people, products and services that are helping to improve dental health. The votes are cast by members of the DrBicuspid.com professional community and DrBicuspid.com readers, and honor the best of what dentistry has to offer.
  • Received the 2014 Clinical Research Award for PerioPredict™: In September, Dr. Kornman and Dr. Lynn Doucette-Stamm, Vice President of Development and Clinical Operations, together with their co-authors, received the prestigious Clinical Research Award for PerioPredict™ at the 100th American Academy of Periodontology (AAP) Annual Meeting and Anniversary Celebration. This award recognizes a published scientific manuscript that has direct clinical relevance to periodontics. The study, titled “Patient Stratification for Preventive Care in Dentistry,” provided important new insights into the prevention of periodontal disease and the significant opportunity to improve oral health through a personalized approach to preventive care. The article was originally published in the Journal of Dental Research (June 2013).
  • Provided Expert Commentary Regarding the Future of Periodontology at Investor and Scientific Events: In September, Dr. Kornman was one of three keynote panelists selected for the Opening General Session of the AAP, titled “Pillars of the Past, Foundation for the Future.” Also at the AAP, Dr. Kornman was one of the presenters at a course, titled “The Role of Emerging Diagnostics in Periodontal Practice.” At BTIG’s Inaugural Emerging Technologies in Healthcare Diagnostics Symposium in New York, Dr. Kornman participated in a panel discussion titled “Learned Lessons from Stakeholders – How Much do Economics Matter?” and gave a presentation on the Company’s PerioPredict™ genetic test.

Conference Call and Webcast Information

Interleukin Genetics, Inc. will host a live conference call and webcast today at 8:30 a.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. (OTCQB: ILIU) develops and markets proprietary genetic tests for chronic diseases and health related conditions. The products empower individuals to prevent certain chronic conditions and manage their existing health and wellness through genetic-based insights with actionable guidance. Interleukin Genetics leverages its research, intellectual property and genetic panel development expertise in metabolism and inflammation to facilitate the emerging personalized healthcare market. The Company markets its tests through partnerships with health and wellness companies, healthcare professionals and other distribution channels. Interleukin Genetics’ flagship products include its proprietary PerioPredict™ genetic risk panel for periodontal disease and tooth loss susceptibility sold through dentists, and the Inherent Health Weight Management Genetic Test that identifies the most effective diet and exercise program for an individual based on genetics. Interleukin Genetics is headquartered in Waltham, MA and operates an on-site, state-of-the-art DNA testing laboratory certified under the Clinical Laboratories Improvements Act (CLIA). For more information please visit www.ilgenetics.com.

Certain statements contained herein are “forward-looking” statements, including statements related to the need to both increase utilization of PerioPredict™ among covered patients, while increasing the number of insurance payors who cover the test and the sufficiency of cash and cash equivalents as of September 30, 2014 to fund the Company’s operations through February 2015. 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, 2013 and other filings with the Securities and Exchange Commission. The Company disclaims any obligation or intention to update these forward-looking statements.

 
INTERLEUKIN GENETICS, INC.
FINANCIAL HIGHLIGHTS
         
Balance Sheet Data September 30, December 31,

2014

2013

 
 
Cash and cash equivalents $ 2,604,399 $ 7,542,281
Total current assets $ 3,382,387 $ 8,952,583
Total assets $ 4,457,125 $ 10,125,055
 
Total current liabilities $ 3,519,836 $ 4,871,833
Total liabilities $ 3,519,836 $ 4,871,833
 
Total shareholders' equity $ 937,289 $ 5,253,222
 
Total liabilities and shareholders' equity $ 4,457,125 $ 10,125,055
 
 
Statement of Operations Data Three Months Ended Sep 30, Nine Months Ended Sep 30,

2014

2013

2014

2013

Revenue:
Genetic testing service revenue $ 439,400 $ 411,557 $ 1,342,947 $ 1,744,342
Other   32,751     7,484     145,365     14,220  
Total revenue 472,151 419,041 1,488,312 1,758,562
Cost of Revenue   358,578     362,769     1,115,095     1,242,757  
 
Gross profit 113,573 56,272 373,217 515,805
 
Operating costs and expenses:
Research and development 242,142 161,353 666,839 509,509
Selling, general and administrative 1,305,583 2,035,179 4,338,245 4,610,737
Amortization of intangibles   23,525     27,317     70,575     81,950  
 
Total operating expenses   1,571,250     2,223,849     5,075,659     5,202,196  
 
Loss from operations (1,457,677 ) (2,167,577 ) (4,702,442 ) (4,686,391 )
 
Total other income and (expense), net   911     (8,480 )   4,511     (467,557 )
Loss from operations
before income taxes (1,456,766 ) (2,176,057 ) (4,697,931 ) (5,153,948 )
Benefit for income taxes   -     -     -     -  
Net loss $ (1,456,766 ) $ (2,176,057 ) $ (4,697,931 ) $ (5,153,948 )
 
Basic and diluted net loss per common share $ (0.01 ) $ (0.02 ) ($0.04 ) ($0.06 )
Weighted average common shares outstanding,
basic and diluted   122,548,292     122,277,324     122,515,671     79,666,229  
 

Contacts

Media:
Argot Partners
David Pitts, 212-600-1902
david@argotpartners.com
or
Investors:
Argot Partners
Susan Kim, 212-600-1902
susan@argotpartners.com

Interleukin Genetics, Inc.