Bioniche Life Sciences Inc. Reports Q3, Fiscal 2013 Results

         Bioniche Life Sciences Inc. Reports Q3, Fiscal 2013 Results

PR Newswire

TORONTO, May 8, 2013

(all figures are in Canadian dollars unless otherwise noted)

TORONTO, May 8, 2013 /PRNewswire/ - Bioniche Life Sciences Inc. (TSX: BNC)
(ASX: BNC), a research-based, technology-driven Canadian biopharmaceutical
company, today announced financial results for the third quarter of its 2013
fiscal year (ended March 31, 2013).

Management has been making concerted efforts to unlock corporate value for the
benefit of all  shareholders, and  these efforts  have been  progressing on  a 
number of fronts. "The actions by a group of dissident shareholders in  recent 
weeks was  unexpected, and  has  presented a  challenge  that the  Company  is 
dealing with in consultation with external advisors," added Mr. McRae.  "These 
actions appear  to be  motivated by  recognition of  the significant  inherent 
value within the Company."

"Meanwhile, Animal  Health product  sales remain  ahead of  Fiscal 2012  on  a 
year-to-date basis, and we are encouraged by the interest in Immunocidin™  and 
Sin Susto™ - two new companion  animal products that were launched within  the 
last six months,"  said Mr.  Graeme McRae, President  & CEO  of Bioniche  Life 
Sciences Inc. "At the same time, we  are pleased with the level of  engagement 
with new potential partners for our  Phase III human bladder cancer product  - 
Urocidin™. Since  the return  of global  rights from  Endo Pharmaceuticals  in 
December, 2012, more than 30 companies  have approached us about becoming  our 
new marketing partners in various jurisdictions."

The Company just received clinical sponsorship for Urocidin™ back from Endo in
early April, but has  already scheduled a meeting  with Health Canada in  late 
June, 2013 to discuss the potential  for Urocidin™ to be considered under  the 
regulator's Notice  of  Compliance  with conditions  (NOC/c)  policy.  If  the 
Company is successful  in obtaining access  to the Canadian  market under  the 
NOC/c policy, a new drug  submission will be made  to Health Canada within  60 
days of the  meeting. Approximately one  year of review  would follow and,  if 
Health Canada is satisfied with the submission, an approval under NOC/c  could 
follow in 2014, giving the Company full access to the Canadian market.

Fiscal 2013 Third Quarter Financial Results Highlights

Revenues from the  sale of  Animal Health products  were $7.4  million in  the 
quarter, as compared to $8.4 million in the same period in Fiscal 2012 - a 12%
decrease. The timing of sales orders contributed to this decline. However,  on 
a year-to-date  basis,  Animal  Health product  revenues  have  reached  $22.8 
million,

compared to  $21.9  million in  Fiscal  2012.  This represents  growth  of  4% 
year-over-year. Consolidated revenues for the quarter were 16% lower than  the 
same period last year  and 4% lower  on a year-to-date  basis, due to  reduced 
collaborative research revenues and the drop in product revenues in the  third 
quarter.

Gross margins were 51.5 % in Q3,  Fiscal 2013, compared to 48.7% in the  third 
quarter of last year.  The margins are 51.8%  on a year-to-date basis,  versus 
50.3% in the first nine months of Fiscal 2012.

The Company generated Earnings (Loss) Before Interest, Taxes, Depreciation and
Amortization (EBITDA) -  before research and  development expenses and  income 
taxes - of $0.5 million for Q3,  Fiscal 2013, as compared to $0.6 million  for 
the same period in Fiscal 2012. On a year-to-date basis, the EBITDA before R&D
amounted to $1.4 million as compared  to $1.2 million at the nine-month  point 
in Fiscal 2012. This increase relates to increased Animal Health revenues  and 
reduced administration  expenses, partially  offset by  reduced  collaborative 
research revenues.

Cash and  cash equivalents  amounted to  $6.5 million  at March  31, 2013,  as 
compared $20 million at  June 30, 2012. Further,  non-cash working capital  of 
$6.1 million was available to the Company at March 31, 2013. At June 30, 2012,
non-cash working capital totaled $7.5 million.

"In terms of corporate  finances, the Company has  been exploring a number  of 
options to boost  its cash  reserves," said  Mr. Brian  Ford, Chief  Financial 
Officer, Bioniche Life Sciences Inc. "Our lender - Capital Royalty Partners II
L.P. - has been involved in  these discussions, and is investigating  possible 
ways to assist with the Company as our value-creating events are consummated."

At March 31, 2013, the Company's net working capital totalled $12.6 million as
compared to working capital of $27.5 million at June 30, 2012, reflecting  the 
decrease in  cash  primarily used  to  invest in  late-stage  development  and 
commercialization activities.

The Company's cash  flows used  in operations  before net  changes in  working 
capital for the nine-month period ended  March 31, 2013 was $12.5 million,  as 
compared to cash flows used in operations of $11.0 million in the same  period 
in Fiscal 2012. This  increase is primarily related  to an increased net  loss 
which reflects increased financing expenses as a result of the long-term  debt 
financing that was established in April, 2012.

On a year-to-date  basis, the average  monthly burn rate  for the Company  was 
$1.4 million, vs. $1.2 million for the same nine-month period in Fiscal  2012. 
Cash requirements to support financing have increased the average monthly burn
rate by $0.2 million compared to last year. This relates to the cash  interest 
associated with the Capital Royalty debt of US$20 million, received in  April, 
2012.

The Company remains  committed to reducing  operating expenses and  increasing 
revenues  through  the  commercialization   of  new  products  and   strategic 
partnering deals  related  to  its  core  technologies.  The  Company  remains 
committed to neutralizing  the monthly  burn rate  and developing  sustainable 
positive cash flows by the end of Fiscal 2014.

Administrative expenses were $1.8 million in  Q3, Fiscal 2013, as compared  to 
$2.4 million  in  the  same  quarter  last  year.  On  a  year-to-date  basis, 
administrative expenses were $6.0 million  in Fiscal 2013 versus $7.4  million 
in the first nine months of  Fiscal 2012. Marketing, selling and  distribution 
expenses were $1.8 million in Q3, Fiscal 2013, no change from the same quarter
last year. On a year-to-date basis, these expenses were $5.6 million this year
versus $5.1 million last year. The additional expenditure in this category  is 
related to  increased expenditures  to  support the  launch and  promotion  of 
several new Animal Health products.

Research and  development (R&D)  expenditures for  Q3, Fiscal  2013 were  $4.5 
million, as compared to $5.5  million in the same  quarter last year. For  the 
nine months ending March 31, 2013, R&D expenditures were $13.0 million  versus 
$15.0 million for the same period last year. R&D resources are focused on  the 
advancement of certain development programs in Animal Health and Food  Safety, 
and continued investment  in the staffing  and infrastructure associated  with 
the GMP  production of  the Company's  Urocidin^TM bladder  cancer  treatment. 
Further, until  such time  as the  Company's Vaccine  Manufacturing Centre  in 
Belleville is making  commercial product, the  carrying costs associated  with 
this facility  are also  accounted for  under R&D.  The Vaccine  Manufacturing 
Centre continues to undergo GMP validation, a process which is expected to  be 
completed this summer.

The Company  continues its  efforts to  encourage the  Canadian government  to 
adopt a national E. coli cattle vaccination program. The Canadian  Cattlemen's 
Association has finally  acknowledged that there  is an E.  coli problem  with 
beef and urged the government to adopt irradiation as a solution, ignoring the
existence of an approved vaccine -  Econiche® - that targets the reduction  of 
E. coli O157 at the source: cattle. Human illnesses from this deadly  pathogen 
come from many sources other than beef consumption.

The Company incurred financial expenses of $4.7 million during the first  nine 
months of Fiscal 2013, partly as a result of its US$20 million debt  financing 
with Capital  Royalty  Partners,  but also  including  interest  accretion  on 
repayable government assistance. This compares  to financial expenses of  $0.5 
million in the same period of Fiscal  2012, $0.4 million of which was  related 
to non-cash interest accretion.

The basic  and  fully-diluted net  loss  per share  for  Q3, Fiscal  2013  was 
($0.05), as compared  to ($0.06) in  the same period  last year. Total  Common 
Shares outstanding  at  March  31,  2013  were  104,809,572,  as  compared  to 
103,127,506 at March 31, 2012.

The Company has incurred significant losses and has an accumulated deficit  of 
$136.1 million as at March 31, 2013, including a current loss of $17.3 million
for the  first  nine months  of  Fiscal  2013. The  Company's  committed  cash 
obligations and  expected level  of expenditures  for the  next twelve  months 
exceed its committed resources  of funds and funds  available as at March  31, 
2013.

As earlier reported, the Company has  formed a Special Committee of its  Board 
of Directors to, among other things, oversee a broad exploration of  strategic 
alternatives to address the Company's liquidity  needs and to unlock value  in 
its assets. The  Company is  exploring all  financing alternatives,  including 
additional debt  and/or  equity  financing, licensing  arrangements,  and  the 
monetization of assets through a sale of technologies, assets and/or  business 
units, or  strategic  partnering of  technologies  under development.  If  the 
Company is  unable  to accomplish  these  initiatives, which  are  outside  of 
management's control, the Company will be required to curtail its  development 
activities and operations.

About Bioniche Life Sciences Inc.

Bioniche Life Sciences  Inc. is a  research-based, technology-driven  Canadian 
biopharmaceutical   company   focused    on   the   discovery,    development, 
manufacturing, and marketing of proprietary and innovative products for  human 
and animal health markets worldwide. The fully-integrated company employs more
than 200 skilled personnel  and has three  operating divisions: Human  Health, 
Animal Health, and Food Safety. The  Company's primary goal is to develop  and 
commercialize products  that  advance  human or  animal  health  and  increase 
shareholder value.

For more information, please visit www.Bioniche.com.

Except  for   historical   information,   this  news   release   may   contain 
forward-looking statements  that  reflect the  Company's  current  expectation 
regarding future  events. These  forward-looking statements  involve risk  and 
uncertainties, which  may  cause, but  are  not limited  to,  changing  market 
conditions, the  successful and  timely completion  of clinical  studies,  the 
establishment of corporate alliances, the  impact of competitive products  and 
pricing, new  product development,  uncertainties  related to  the  regulatory 
approval process, and other risks detailed from time to time in the  Company's 
ongoing quarterly and annual reporting.

Bioniche Life Sciences Inc.
Amalgamated under the laws of Ontario

       CONDENSED INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
                                 (Unaudited)
                                                              
As at                                            March 31, 2013 June 30, 2012
(thousands of Canadian dollars)                                $             $
ASSETS                                                                     
Current
Cash and cash equivalents                                 6,468        20,020
Trade and other receivables                               7,095         6,787
Inventories                                               8,674         7,776
Prepayments                                               1,009         1,081
                                                        23,246        35,664
Non-current                                                                
Property, plant and equipment                            40,534        40,134
Intangible assets                                         4,708         5,206
Goodwill                                                    456           456
Other non-current receivables                               126           183
Deferred tax assets                                         340           509
Total assets                                             69,410        82,152
                                                                          
LIABILITIES AND SHAREHOLDERS' EQUITY                                       
(DEFICIENCY)
Current                                                                    
Trade and other payables                                  8,317         6,713
Income taxes payable                                        287            94
Current portion of long-term debt                           969           997
Current portion of repayable government                   1,116           366
assistance
                                                        10,689         8,170
Non-current                                                                
Long-term debt                                           26,173        25,438
Repayable government assistance                          31,642        30,921
Employee benefit liability                                1,962         1,875
                                                        70,466        66,404
Shareholders' equity (deficiency)                                          
Share capital                                           126,746       126,354
Other paid-in capital                                     9,662         9,327
Deficit                                               (136,148)     (118,807)
Foreign currency translation reserve                    (1,316)       (1,126)
Total shareholders' equity (deficiency)                 (1,056)        15,748
Total liabilities and shareholders' equity               69,410        82,152
(deficiency)

Bioniche Life Sciences Inc.

              CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN
                         SHAREHOLDERS' EQUITY (DEFICIENCY)
                                    (Unaudited)
                                                                   
                                                                  Foreign
                    Preferred   Total     Other                currency
(thousands   Common      Shares   Share   paid-in             translation
of Canadian  Shares    Series I Capital Capital     Deficit     reserve      Total
dollars)          $           $       $         $           $           $          $
Balance,    126,354           — 126,354     9,327 (118,807)     (1,126)     15,748
June 30,
2012
Net loss          —           —       —         —    (17,341)           — (17,341)
for the
period
Exchange          —           —       —         —           —       (190)      (190)
difference
on
translation
of foreign
operations
Issued          354           —     354         —           —           —        354
under
employee
Share
ownership
plan
Fair value        —           —       —       335           —           —        335
of stock
Options
vested
Shares           37           —      37         —           —           —         37
issued to
Directors
Options           1           —       1         —           —           —          1
exercised
Balance,    126,746           — 126,746     9,662   (136,148)     (1,316)    (1,056)
March 31,
2013
                                                                            
Balance,    125,469         161 125,630     8,771    (95,687)     (1,174)     37,540
June 30,
2011
Net loss          —           —       —         —    (14,437)           —   (14,437)
for the
period
Exchange          —           —       —         —           —          59         59
difference
on
translation
of foreign
operations
Issued          659           —     659         —           —           —        659
under
employee
Share
ownership
plan
Fair value        —           —       —       541           —           —        541
of stock
Options
vested
Share             —       (161)   (161)         5           —           —      (156)
redemption
Options           —           —       —         1           —           —          1
issued to a
consultant
Options           8           —       8       (3)           —           —          5
exercised
Balance,    126,136           — 126,136     9,315   (110,124)     (1,115)     24,212
March 31,
2012

Bioniche Life Sciences Inc.

   CONDENSED INTERIM CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS
                                 (Unaudited)
                                                                        
For the three and nine               2013        2012        2013        2012
months ended March 31                    $           $           $           $
(thousands of Canadian
dollars, except Share and
per Share amounts)
                                                                        
REVENUES                                                                 
Product                             7,372       8,377      22,760      21,857
Research collaborations                 —         370          82       1,821
                                   7,372       8,747      22,842      23,678
EXPENSES                                                                 
Cost of sales                       3,572       4,294      10,972      10,871
Administrative                      1,757       2,406       6,023       7,361
Marketing and selling               1,843       1,759       5,557       5,092
Financial expenses                  1,533         279       4,687         504
Foreign exchange loss (gain)        (106)         280         114       (246)
                                   8,599       9,018      27,353      23,582
(Loss) income before              (1,227)       (271)     (4,511)          96
research and development
expenses and income taxes
Research and development            4,507       5,532      13,034      15,031
expenses, gross
Less: government assistance         (229)           —       (574)       (372)
Loss before income taxes          (5,505)     (5,803)    (16,971)    (14,563)
Income tax expense                     46          87         370       (126)
(recovery)
Net loss for the period           (5,551)     (5,890)    (17,341)    (14,437)
OTHER COMPREHENSIVE (LOSS)
INCOME
Exchange difference on
translation of foreign
operations                          (208)          33       (190)          59
Total comprehensive loss for      (5,759)     (5,857)    (17,531)    (14,378)
the period
Basic and diluted net loss         (0.05)      (0.06)      (0.17)      (0.14)
per Common Share
Weighted-average number of    104,532,477 102,998,425 104,034,633 102,627,328
Common Shares outstanding

Bioniche Life Sciences Inc.

           CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (Unaudited)
                                                                       
For the nine months ended March 31                                      
                                                          2013       2012
(thousands of Canadian dollars)                            $            $
OPERATING ACTIVITIES                                                    
Net loss for the period                                (17,341)   (14,437)
Items not affecting cash and other reconciling                          
items:
 Depreciation of property, plant and equipment           1,108      1,121
 Amortization of intangible assets                       1,022        730
 Unrealized foreign exchange gain                        (397)      (142)
 Finance expense on government incentives,               2,263        447
long-term debt
  and repayable government assistance
 Stock-based compensation expense                          335        541
 Shares issued to directors                                 37          —
 Employee Share ownership plan                             354        659
 Employee future benefit                                    87         88
 Deemed government assistance                                —        (7)
 Write off of intangible asset                               —        143
 Deferred income taxes                                      37      (126)
 Other                                                       —          1
                                                      (12,495)   (10,982)
Net change in non-cash working capital balances             945        203
Cash used in operating activities                      (11,550)   (10,779)
INVESTING ACTIVITIES                                                    
Purchases of property, plant and equipment                (380)    (3,966)
Proceeds on disposal of other current financial               —      1,493
asset
Proceeds on disposal of property, plant and                   5          8
equipment
Purchases of intangible assets                            (523)       (46)
Cash used in investing activities                         (898)    (2,511)
FINANCING ACTIVITIES                                                    
Proceeds from repayable government assistance                 —      1,230
Proceeds on exercise of stock Options                         1          5
Proceeds from long-term debt                                  —      2,750
Redemption of Shares                                          —      (156)
Repayment of repayable government assistance              (343)       (57)
Repayment of finance lease obligations                    (336)      (322)
Repayment of long-term debt                               (426)      (255)
Cash provided by (used in) financing activities         (1,104)      3,195
Net decrease in cash and cash equivalents during the   (13,552)   (10,095)
period
Cash and cash equivalents, beginning of period           20,020     15,353
Cash and cash equivalents, end of period                  6,468      5,258





SOURCE Bioniche Life Sciences Inc.

Contact:

Jennifer Shea, Vice-President, Communications, Investor & Government Relations
Bioniche Life Sciences Inc.
Telephone: (613) 966-8058; from Australia: 0011 1 613-966-8058
Cell: (613) 391-2097; from Australia: 0011 1 613-391-2097
Jennifer.Shea@Bioniche.com
 
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