Translational Oncology Solutions Revenues
TOS revenues were
$5.9 millionand $4.8 millionfor the years ended April 30, 2013and 2012, respectively, an increase of $1.1 millionor 23%. The increase in TOS revenues was due primarily to growth in sales of these products, as well as the one-time buyout payment, described below, from the successful completion of a TumorGraft technology collaboration with Cephalon, a subsidiary of Teva Pharmaceutical Industries. On November 30, 2012, Cephalon exercised its option to pay a one-time fee of $880,000to the Company, in lieu of any future milestone or royalty payments relative to a March 16, 2011agreement between Cephalon and the Company, which is discussed further above. This fee was recognized as revenue during the year ended April 30, 2013.
Cost of Personalized Oncology Solutions
POS cost of sales was
$2.7 millionand $2.4 millionfor the years ended April 30, 2013and 2012, respectively, an increase of $0.3 million, or 13%. For the years ended April 30, 2013and 2012, gross margins for POS were negative 12% and 1%, respectively. The increases in cost of sales and the declines in gross margins are attributed to increased volumes of implants and drug studies performed, at lower prices as discussed above.
Cost of Translational Oncology Solutions
TOS cost of sales was
$2.7 millionand $2.5 millionfor the years ended April 30, 2013and 2012, respectively, an increase of $0.2 million, or 4%. For the years ended April 30, 2013and 2012, gross margins for TOS were 55% and 47%, respectively. The increase in gross margin was primarily the result of the Cephalon one-time fee discussed above. Research and Development
Research and development expense was
$1.9 millionand $2.9 millionfor the years ended April 30, 2013and 2012, respectively, a decrease of $1.0 millionor 35%. This decrease is primarily related to decreased laboratory maintenance costs associated with research and development efforts, as a result of lower unit costs associated with performing the work in our laboratory. Additionally, the decrease can be attributed to decreased tumor costs, resulting from our strategy to source models from our POS business. Sales and Marketing
Sales and marketing expense was
General and Administrative General and administrative expense was
$4.7 millionand $5.5 millionfor the years ended April 30, 2013and 2012, respectively, a decrease of $0.8 million, or 14%. This decrease can be attributed to reductions in stock-based compensation expenses and consultant costs. The decrease in stock-based compensation expense is primarily due to large prior period stock option grants that contain performance conditions and were, and continue to be, accounted for using the accelerated attribution method. Other Income
Other income (expense) consists of the change in the fair value of warrants that are accounted for as liabilities and are described further below and in Note 6 to the accompanying consolidated financial statements. Other income (expense) was
$(0.1) millionand $0.4 millionfor the years ended April 30, 2013and 2012, respectively. The Company will continue to adjust the warrant liability for changes in fair value, until the earlier of the exercise of the warrants or expiration of the warrants. This change in the fair value of the warrant liability was a result of revaluing the warrant liability based on the Monte Carlo simulation valuation model, impacted primarily by the quoted price of the Company's common stock. The revaluation of the warrant liability has no impact on our cash balances.