MELA Sciences Announces 2013 Fourth Quarter and Year-End Financial Results

  MELA Sciences Announces 2013 Fourth Quarter and Year-End Financial Results

Business Wire

IRVINGTON, N.Y. -- March 17, 2014

MELA Sciences, Inc. (NASDAQ:MELA), (the “Company”), developer of MelaFind^®,
an FDA approved optical diagnostic device that assists dermatologists in the
diagnosis of melanoma, today announced financial results for the fourth
quarter and year ended December 31, 2013.

Conference Call

The Company will host a conference call at 4:30pm ET to review results. Please
dial 877-303-9205 (domestic) or 760-536-5226 (international). A live webcast
will be available at: If you are unable to participate
during the live call and webcast, a replay will be archived and available for
approximately 90 days after call.

Fourth Quarter and Full Year 2013 Financial Results

Net Revenues for the three months ended December 31, 2013 were $140,000
compared to $122,000 for the same period last year, an increase of 14.75%.
Cost of revenue for the fourth quarter was $914,000 down 5.87% from $971,000
in the prior year. Total operating expenses for the fourth quarter were $3.6
million down 30.58% from last year, which was due to management’s cost
reduction and cash conservation policy put in place mid-year.

The Company’s net loss for the three months ended December 31, 2013 was $4.6
million, or $0.09 per diluted share, compared to a net loss of $6.1 million,
or $0.19 per diluted share, for the same period in 2012.

Net Revenues for the twelve months ended December 31, 2013 were $536,000
compared to $278,000 reported for the same period in 2012, an increase of
92.81%. Cost of revenue for the full year was $4.3 million compared to $2.0
million for 2012 and primarily relates to increased depreciation expense for
units placed during the year. Total operating expenses for 2013 were $20.3
million down 3.02% from last year and included an impairment charge taken in
the third quarter of approximately $1 million related to our MelaFind^®
systems placed in the field.

The net loss for 2013 was $25.9 million or $0.60 per share compared to $22.7
million or $0.74 per share in 2012. The net loss for 2013 includes the $1
million non-cash impairment charge mentioned above, a write-off of unamortized
loan costs of approximately $1 million relating to the pay-off of long term
debt, increased interest expense of $0.6 million also attributed to the long
term debt and a non-cash charge of $0.3 million primarily related to warrants
issued in the October 2013 financing that must be accounted for as a

Fourth Quarter and Full Year 2013 Highlights

On October 31, 2013 the Company closed on a $6 million registered direct
offering, which resulted in net proceeds to the Company of approximately $5.5
million. As part of the offering the Company sold just over 4.2 million shares
of common stock and prefunded warrants to purchase up to 4.3 million shares of
common stock. The Company also issued additional warrants to purchase up to
6.9 million shares of common stock, which could result in proceeds of $5.8
million, if exercised.

In November, Rose Crane was appointed President and CEO of the Company
bringing over 30 years of healthcare industry experience in fields such as
pharmaceuticals, medical devices and healthcare services. As President and CEO
of Epocrates, a healthcare technology firm, she directed the efforts to take
the company public.

In October, Dr. Darrell Rigel, Clinical Professor of Dermatology at New York
University, Langone Medical Center was appointed Chief Medical Advisor to the
Board. Dr. Rigel also serves as a Regional Chair of the Massachusetts
Institute of Technology Education Council.

In the fourth quarter, MELA Sciences participated in various clinical
conferences and meetings including the following:

  *MelaFind^® was showcased at the American Society of Dermatologic Surgery
    Annual Meeting, the meeting was held over four days and provided attendees
    the opportunity to stay current on innovative devices, news and
  *presented four Poster Presentations at the 32^nd Annual Fall Clinical
    Dermatology Conference in Las Vegas and held its first Clinical Advisory
    meeting, which announced the launch of a new user study, called the
    MelaFind^® Experience Trial (MET–1);
  *participated in the Washington D.C. Dermatological Society’s Fall Clinical
    Conference, a hands-on symposium involving live patient case studies and
    pathology analysis; and
  *in conjunction with the Mount Sinai Winter Dermatology Symposium, hosted
    its second Clinical Advisory Meeting chaired by Dr. Gary Goldenberg,
    Medical Director of Mount Sinai’s Dermatology Faculty Practice.

“Having joined MELA Sciences just before the end of the year, I can only say
thank you to everyone from management to staff for their diligence and hard
work throughout 2013. The market proved to be a difficult one and ultimately
the Company realized that a refocused strategy was in order. So I am happy to
say we have initiated a new business plan and a new business model that will
serve not only MELA but dermatologists and most importantly the patients at
high risk for melanoma,” said Rose Crane, President and CEO of MELA Sciences.

The new business plan refocuses the Company’s go-to-market strategy on medical
dermatologists who treat high-risk patients and on Key Opinion Leaders at
leading hospitals and teaching institutions in the United States as they lead
the charge on melanoma.

The new business model allows dermatologists to purchase the MelaFind^® device
rather than rent it. This is typically how business is conducted for medical

The Company is also working diligently on securing insurance reimbursement
codes for both doctors and insurance companies.

Since the end of 2013, the Company has also taken important steps in raising
awareness of, the Company and its product MelaFind^®, and strengthening its
balance sheet. Senior management presented at a small-cap investor conference
in New York and was well received. MelaFind^® has been introduced to several
major institutions in the United States gaining placement in four of the
leading melanoma centers.

In February, the Company completed a private placement offering with two major
healthcare institutional investors and its directors for net proceeds of
approximately $11.54 million prior to approximately $2.5 million in penalties
that have applied and up to an additional $1.4 million in penalties that may
apply. As part of the offering the Company sold shares of its non-redeemable
preferred stock, which is convertible into approximately 14.6 million shares
of its common stock and warrants to purchase up to 13.3 million shares of
common stock which, if exercised, could result in proceeds to the Company of
up to $9.8 million. In addition, the Company sold approximately 200,000 shares
of its common stock to its directors.

Please follow us:
Twitter: @MELASciencesIR or @MelaFind
StockTwits: @MELASciencesIR

About MELA Sciences, Inc.

MELA Sciences is a medical device company developing dermatology diagnostics
utilizing state-of-the-art optical imaging. The flagship product is
MelaFind^®, an FDA, PMA and CE Mark approved, non-invasive diagnostic tool to
assist dermatologists in melanoma evaluation and diagnosis. MelaFind^® uses a
variety of visible to near-infrared light waves to analyze atypical pigmented
skin lesions 2.5mm below the skin surface. It provides images and data on the
relative disorganization of a lesion's structure that provides substantial
additional perspective to assist melanoma diagnosis. MELA is also exploring
new potential uses for its core imaging technology and algorithms.

Safe Harbor

This press release includes "forward-looking statements" within the meaning of
the Securities Litigation Reform Act of 1995. These statements include but are
not limited to our plans, objectives, expectations and intentions and may
contain words such as “seeks,” “look forward,” and “there seems” that suggest
future events or trends. These statements are based on our current
expectations and are inherently subject to significant uncertainties and
changes in circumstances. Actual results may differ materially from our
expectations due to financial, economic, business, competitive, market,
regulatory and political factors or conditions affecting the company and the
medical device industry in general, as well as more specific risks and
uncertainties set forth in the company’s SEC reports on Forms 10-Q and 10-K.
Given such uncertainties, any or all of these forward-looking statements may
prove to be incorrect or unreliable. MELA Sciences assumes no duty to update
its forward-looking statements and urges investors to carefully review its SEC
disclosures available at and

As of December 31, 2013 and 2012
(in thousands, except for share and per share data)
                                                   2013           2012
Current Assets:
Cash and cash equivalents                          $ 3,783        $ 7,862
Accounts receivable, net                             57             180
Inventory, net                                       5,631          676
Prepaid expenses and other current assets           880          965      
Total Current Assets                                 10,351         9,683
Property and equipment, net                          3,691          7,350
Patents and trademarks, net                          42             47
Deferred financing costs                             -              106
Other assets                                        48           84       
Total Assets                                       $ 14,132      $ 17,270   
Current Liabilities:
Accounts payable                                   $ 1,479        $ 1,850
Accrued expenses                                     844            956
Deferred placement revenue                           244            172
Warrant liability                                    3,017          -
Other current liabilities                           68           41       
Total Current Liabilities                           5,652        3,019    
Long Term Liabilities:
Deferred placement revenue                           64             132
Deferred rent                                       120          144      
Total Long Term Liabilities                         184          276      
Total Liabilities                                   5,836        3,295    
Stockholders' Equity
Preferred stock - $.10 par value; authorized
10,000,000 shares: issued and outstanding:
Common stock - $.001 par value; authorized
Issued and outstanding 47,501,596 and
32,204,720 shares at December 31, 2013 and           48             32
2012, respectively.
Additional paid-in capital                           176,396        156,143
Accumulated deficit                                 (168,148 )    (142,200 )
Stockholders' Equity                                8,296        13,975   
Total Liabilities and Stockholders' Equity         $ 14,132      $ 17,270   

(in thousands, except for share and per share data)
                   Three months ended December 31    Twelve months ended December 31
                   2013             2012             2013             2012
Net revenues         140              122              536              278
Cost of             914            971            4,341          2,042      
Gross profit         (774       )     (849       )     (3,805     )     (1,764     )
Research and         540              1,285            3,782            6,792
general and          3,096            3,953            15,536           14,169
Impairment of
long-lived          -              -              1,011          -          
operating           3,636          5,238          20,329         20,961     
Operating loss       (4,410     )     (6,087     )     (24,134    )     (22,725    )
Other income
Interest             1                4                8                32
Interest             (1         )     -                (564       )     -
Change in fair
value of             (206       )     -                (296       )     -
Loss on early
extinguishment       -                -                (983       )     -
of debt
Other income,       6              5              21             20         
                    (200       )    9              (1,814     )    52         
Net loss           $ (4,610     )   $ (6,078     )   $ (25,948    )   $ (22,673    )
Basic and
diluted net        $ (0.09      )   $ (0.19      )   $ (0.60      )   $ (0.74      )
loss per
common share
Basic and
average number      46,058,796     31,727,391     42,894,500     30,762,610 
of common


MELA Sciences, Inc.
Diana Garcia Redruello
Catalyst Global
Toni Trigiani, David Collins
Press spacebar to pause and continue. Press esc to stop.