A Medical Device Daily
Two companies – Cardima (Fremont, California) and NeoRx (Seattle) – were among those that reported "going concerns" last week.
Cardima said that BDO Seidman, its independent auditor, included a paragraph in its annual report, stating concern regarding Cardima's ability to continue as a going concern. A similar explanatory paragraph has been included in its annual report filings each of the past three years by the company's independent auditor.
Cardima noted that it has suffered "recurring losses from operations and has a net capital deficiency that raises substantial doubt about its ability to continue as a going concern."
As of March 31, Cardima had around $1.7 million in cash and cash equivalents. Based on its 2005 plan, the company said that this cash balance will provide sufficient capital to fund operations only "for a very limited period of time and will not be sufficient to fund operations into the third quarter of 2005."
It said it is exploring funding opportunities, including the sale of equity securities or entering into a strategic transaction relating to its Surgical Ablation System.
Cardima has developed the Revelation Tx, Revelation T-Flex and Revelation Helix linear ablation microcatheters, the Naviport deflectable guiding catheters, and the Intellitemp energy management system for the minimally invasive treatment of atrial fibrillation. The company also has developed a Surgical Ablation System, used in ablating cardiac tissue during heart surgery using radio frequency energy. The company received FDA clearance for the system in February 2003.
NeoRx said also that its 2004 financial statements, the audit opinion of KPMG contained a going concern qualification.
NeoRx is a cancer therapeutics development company. The Company's product pipeline includes STR, a radiotherapeutic targeting bone, currently in a pivotal Phase III clinical trial for patients with multiple myeloma, and NX 473, a next-generation platinum therapy that it plans to evaluate in the treatment of advanced lung and colorectal cancers.