The clinical research organization (CRO), that designs and manages clinical trials for the pharmaceutical and biotechnology industries, said that its 2004 third quarter revenue had been negatively impacted by significant unanticipated cost increases of completing some of its studies.
The company has also experienced a general decrease in clinical trial activity and lower than anticipated new business contracts since the third quarter 2004 and has cut staff accordingly to control costs.
"We are competing for multiple new business contracts which we believe will help us significantly improve our future operating results. We expect to make additional new business announcements during the fourth quarter of this year," said Kenneth Borow, president and CEO.
>Covalent reported an operational loss of $290,787, however this was over seven times less the operational loss for the same quarter last year.
The business has, however, generated double the amount of cash it did at the end of 2004, although this did include a one-time income tax refund of $1.1 million.
"Our third quarter financial results improved significantly compared to the third quarter of 2004 with our business providing $3.9 million of positive cash flow from operations," said Borow.
"We are now actively seeking new business opportunities in order to grow our revenues and leverage our in-house resources to a fuller extent," said Borow.