Medgenics, Inc. (NYSE Amex: MDGN and AIM: MEDU, MEDG) (the “Company”), the developer of a novel technology for the sustained production and delivery of therapeutic proteins in patients using their own tissue, today announced financial results for the year ended December 31, 2011, and the filing with the U.S. Securities and Exchange Commission (“SEC”) of the Company’s Annual Report on Form 10-K. The Form 10-K includes audited annual consolidated financial statements containing the information highlighted below, as well as additional information regarding the Company. The Form 10-K is available at www.sec.gov and at www.medgenics.com. It will be mailed to shareholders on or about March 9, 2012.
2011 Financial Results
For the year ended December 31, 2011, net research and development (“R&D”) expense increased to $5.05 million from $1.53 million for the year ended December 31, 2010. This increase is due to the use of materials and sub-contractors in connection with the Phase I/II EPODURE™ clinical trial, increased expenses in developing our Factor VIII Biopump™ and preparations for the clinical trial of INFRADURE™, including the production of a GMP vector, as well as an increase in R&D personnel and patent expenses. These increases were partially offset by $0.94 million participation from the Israeli Office of the Chief Scientist (“OCS”) and a third party recorded during 2011, compared with $1.85 million participation from the OCS, a U.S. grant and a third party during 2010.
General and administrative expense for the year was $4.92 million compared with $4.41 million for 2010. The increase was largely due to legal and professional services fees in connection with Medgenics’ IPO and to stock-based compensation expense related to options granted to consultants.Other income for 2011 was $0.00 compared with $2.58 million for 2010. Other income in 2010 reflects the excess of the recognized amount received from the third party collaboration agreement over the amount of R&D expense incurred during the period in connection with the agreement.