'Uncertainty' over future of Neurostream joint venture with Otto Bock: Victhom
Victhom Human Bionics Inc. (TSXV:VHB) says there is "uncertainty" over whether Neurostream Technologies, its joint venture partnership to develop products to treat conditions such as sleep apnea, can continue as a going concern.
The Quebec-based company, which reported its financial results Friday, holds a 44.4 per cent interest in the venture with Otto Bock HealthCare.
As of the end of the most recent quarter on June 30, Neurostream had still failed to meet a milestone for its Neurobionix products that had been due May 1.
Victhom said that while there is sufficient liquidity to meet cash flow requirements for at least the next 12 months "management believes that its joint venture... will require additional financing to fund its continuing operations."
Otto Bock is continuing to fund Neurostream's operations on a voluntary basis but "the outcome of this situation is dependent on a number of factors that are not entirely under the company's control," Victhom said.
"As a result, there is uncertainty as to whether the company's joint venture will have the ability to continue as going concern."
Meanwhile, Victhom reported second-quarter revenue decreased 94.4 per cent to $27,901 compared with $495,736 in the comparable 2009 quarter.
The decrease is attributable to the transfer of product support and development activities to its partner Ossur, an orthopedics company based in Iceland that was completed during the first quarter.
Victhom, which develops and makes bionic devices involved in the treatment of a variety of physical and physiological dysfunctions, did not provide any net income or per share information.
Victhom voluntarily delisted itself from the Toronto Stock Exchange at the end of last year and started trading on the TSX Venture market Dec. 30.
"During the second quarter of 2010, our joint venture Neurostream, continued to make good progress on the development and registration of the commercial version of the Neurostep product with the European regulatory authorities," president and CEO Normand Rivard said.
"However, the overall Neurostep project is taking longer than anticipated ... (and) therefore the European market launch and the start of the U.S. clinical trial for the Neurostep product have been postponed to next year."
Victhom shares were down a penny at 7.5 cents in afternoon trading Friday.