Executives at Radient Pharmaceuticals Corporation may one day look back on 2009 as the year when the coming-out party for the two-decades-old firm located in Tustin, California, began. Until last fall, the company focused largely on the production and distribution of pharmaceutical products through its subsidiaries in the People’s Republic of China. That changed on September 18, 2009, when the firm refocused its core business strategy on the international commercialization of its Onko-Sure In Vitro Diagnostic (IVD) Cancer Test Kits and, to a lesser extent, Elleuxe skin care products.
“What we’ve really determined is that focusing on a much narrower path of being a cancer diagnostic company, or an IVD company, is the strongest path for us,” said company chairman and CEO Douglas MacLellan. In addition to changing its focus, the company also changed its name from American Medical Diagnostics Lab (AMDL) to the current Radient Pharmaceuticals.
Radient spent 18 years developing the Onko-Sure test kits and gaining approval from the FDA and regulatory agencies in other countries. Commercial sales were initiated in 2009, a year in which the company sold 1005 kits, a figure MacLellan acknowledged “doesn’t sound like a lot” but is nevertheless important. MacLellan explained that American laboratory companies like Lab Corps view the ability to move at least 1000 kits in a year as a critical milestone when considering taking on a new product.
At an average price of $265 per kit, 2009 sales generated approximately $266,000 in gross revenue for the company, far short of the $1.1 million in aggregate sales the company had previously forecast. Radient anticipates meeting its projection of selling 1100 Onko- Sure test kits during the first quarter of 2010.
The company missed the target of $3 million in financing it had hoped to raise during the fourth quarter of 2009 as a means of executing its distribution plan for 2010, coming in at around $1.5 million instead. But MacLellan maintains a positive perspective. “We’re behind the curve on raising capital, but the definition of a small-cap company is the CEO is always raising capital,” he said. “So, we are still actively raising capital and will be throughout the first half of 2010.” According to a recent press release, the company’s 2010 business plan includes securing additional capital through equity financing and an equity line of credit, securing shareholder approval for various debt for equity transactions to eliminate the majority of the company’s near- and long-term debt, and monetizing ownership of its China-based subsidiary, Jade Pharmaceuticals, Inc.
MacLellan said while the intensity of interest in Onko-Sure is growing, Radient recognizes that change and growth take time. “Our goal is to get some much broader long-term investors into the company who aren’t focused on selling, but are focused on participating in the business with us,” which he described as a change from hedge fund investors whose economic model is to sell shares as quickly as possible. “Then the selling pressure comes off the stock, and we think that will improve things dramatically.”
Onko-Sure measures fibrin and fibrinogen degradation products in the blood. It was previously marketed as the DR-70 (FDP) test and was approved by the FDA in 1982 as a tool for monitoring colorectal cancer. It is also approved in Canada for the monitoring and detection of lung cancer and in the European community and selected countries in Asia Pacific as a general screening tool for 14 types of cancer.