Clarient Inc., an Aliso Viejo cancer diagnostics company, recently reported second-quarter results that beat expectations as it turned a larger profit.
The company, which provides cancer testing for pathologists and oncologists, swung to a $942,000 second-quarter profit from a $29,000 profit a year earlier.
Analysts expected Clarient to break even in the second quarter.
Clarient’s revenue rose 21% to $28.7 million in the second quarter, compared to a $27.6 million expectation from analysts. The company noted that it ran 287,000 tests in the second quarter, a 22% increase from the same period of 2009.
Clarient’s billing and collections were continuing to improve, according to officials.
Michael Rodriguez, Clarient’s chief financial officer, said the company collected $25.6 million in cash during the second quarter. Bad debt accounted for 10.9% of Clarient’s revenue in the second quarter.
The company has wrestled with some collection challenges from time to time.
The testing provider’s “showing marked improvement in bad debt and cash collections and is on track to reduce bad debt as a percent of revenue to the high single digits in the next three to four quarters,” said Matt Dolan, an analyst with Newport Beach-based Roth Capital Partners LLC, in a report.
Clarient also reiterated its previous full-year revenue guidance of $108 million to $115 million, compared to Wall Street’s projection of $113.6 million.
Dolan said he viewed Clarient’s revenue range estimate as conservative and projects revenue of $114 million.
Clarient also said it expects to report net income for 2010 but didn’t give a specific number.
Analysts estimate Clarient will post a full-year profit of $2.6 million.
Clarient “anticipates maintaining this momentum into the second half of the year,” Chief Executive Ron Andrews said in a release.
The company wants to speed up the pace of introducing new tests, such as its Insight Dx Mammostrat, a prognostic, or predictive, test for breast cancer, Andrews said.
UCI Stem Cell Study
The Food and Drug Administration recently gave its permission to resume a clinical trial for a stem cell treatment for paralysis created by scientists affiliated with the University of California, Irvine.
Regulators had placed a nearly year-long hold on the trial, which is being conducted by Geron Corp., a Bay area biotechnology company.
The trial examines a technique for prompting human embryonic stem cells to form tissue around damaged neurons to restore motor functions in paralyzed rats. The technique was developed by Hans Keirstead, a UC Irvine stem cell researcher, and his colleague Gabriel Nistor.
UCI licensed the technology to Geron. Geron, which is based in Menlo Park, will conduct the trial in patients with acute spinal cord injuries across the U.S.
Geron began the study in early 2009 but it was halted seven months later after safety concerns emerged in an animal study, according to the Wall Street Journal. The initial testing in humans will focus on the treatment’s safety. Later trials will be needed to test its effectiveness, the article said.
Okapi Portfolio Bought
Helixis Inc., a maker of medical devices used for analyzing genes that’s just across the county line in Carlsbad, was acquired for $105 million late last month by Illumina Inc., a San Diego-based maker of gene sequencing instruments.
Laguna Beach-based Okapi Ventures LP, which announced the sale, invested in the company and said it made a return of more than six times the capital it invested on the deal.
Sharon Stevenson, Okapi’s cofounder and managing director, called the deal a “stellar outcome” for all parties.
Helixis developed its machines using technology that it licensed from the California Institute of Technology.
Illumina said that the Helixis instrument would allow it to complement its platform with new DNA analysis.
Ensign’s Stock Index
The Ensign Group Inc., a Mission Viejo-based operator of nursing homes, will be entering the Standard & Poor’s SmallCap 600 stock index on a date to be an- nounced, Standard & Poor’s said late last month.
Ensign will replace CyberSource Corp., a Mountain View-based credit card processing company that recently was acquired by San Francisco-based Visa Inc.
Overall, shares of Ensign are up about 16% from the beginning of 2010 with a recent market value of about $374.5 million.
