BOSTON, Mass. ( TheStreet) -- Vanda Pharmaceuticals' ( VNDA - Get Report) buyout partner remains missing in action. No more improper drug marketing claims from Oculus Innovative Sciences ( OCLS). Sequenom ( SQNM) walks back expectations for its Downs syndrome gene test -- these are some of the random notes and observations from second-quarter earnings.
Microcyn is a liquid- and gel-based antiseptic made from a form of diluted bleach that is sold over the counter for $20 a bottle. The U.S. Food and Drug Administration allows Oculus to market Microcyn as a wound cleaner under the agency's regulation of simple medical devices known as 510(k) approvals. Yet, as I reported recently, Oculus has been marketing Microcyn as a drug with specific medical claims that the product cures infections, accelerates wound healing and reduces inflammation in patients with serious diabetic ulcers, according to comments made by Alimi and his CFO Bob Miller on the company's last quarterly conference call held June 11. All these medical claims run afoul of FDA rules, of course. Perhaps someone at the agency sent a letter to Oculus or the company's lawyers stepped in with a warning, because on Thursday night Alimi and Miller were back to describing Microcyn as just a "wound cleaner" and "protector." Meantime, watch for the possibility that channel stuffing is at least partly responsible for Microcyn's sales growth reported in the quarter. Accounts receivable grew 40% quarter over quarter, while Microcyn sales grew 31% quarter over quarter. The company is still losing money, burning cash and heavily dependent on Mexico, which accounts for almost 80% of Microcyn sales of $1.56 million in the quarter. U.S. sales, by comparison, totaled just $131,000.
Stylli said Thursday that Sequenom "hopes" to launch its non-invasive gene test for Down's syndrome in 2010, adding that the company "remains cautious about timelines and milestones." That's a less assured statement than the one Stylli offered in April, when he said the company thought it could launch the Down's test in 2010. Meantime, the company's quasi-independent investigation into how clinical data for the Down's test was "mishandled," including who is responsible, continues with no resolution. -- Reported by Adam Feuerstein in Boston.