Champions Oncology Reports Record Results for the Quarter Ended January 31, 2013

<b>Hackensack, NJ – March 14, 2013</b> – Champions Oncology, Inc. (OTC: CSBR), engaged in the development of advanced technology solutions and services to personalize the development and use of oncology drugs, announced today its financial results for the fiscal quarter ended January 31, 2013.
<h2>Quarterly Highlights:</h2>
<ul>
<li>Record revenue for the quarter of $2.9 million.</li>
<li>$10.8 million of cash at quarter end as a result of successful capital raise during the quarter.</li>
<li>Increase in number of POS implants and studies of 64% and 160% over same quarter last year.</li>
<li>Successful launch of Champions’ POS business in Singapore.</li>
<li>Successful completion of a TumorGraft technology collaboration with a subsidiary of Teva</li>
</ul>
<h2>Pharmaceutical Industries</h2>
Joel Ackerman, Champions Oncology CEO, stated, “This was a great quarter for the company. We made great progress in both the POS and TOS business and continued to build a solid foundation for future growth. With a strong capital position, we are moving quickly to accelerate our plans for leveraging the TumorGraft technology platform for the future.”

Revenue was $2.9 million, as compared to $2.4 million for the three months ended January 31, 2012. For the nine months ended January 31, 2013 and 2012, revenue was $6.5 million and $5.7 million, respectively.

Total operating expenses were $3.6 million, as compared to $4.1 million for the three months ended January 31, 2012. Operating expenses were $10.7 million, as compared to $12.2 million for the nine months ended January 31, 2012.

Champions reported a net loss of $1.0 million, or ($0.02) per share, as compared to a net loss of $1.7 million, or ($0.04) per share, for the three months ended January 31, 2012. For the nine months ended January 31, 2013, Champions reported a net loss of $4.2 million, or ($0.09) per share, as compared to a net loss of $6.1 million, or ($0.13) per share, for the 2012 period.

Excluding stock-based compensation of $0.6 million and $0.7 million for the three months ended January 31, 2013 and 2012, Champions recognized a net loss of $0.4 million, or ($0.01) per share and a net loss of $1.0 million, or ($0.02) per share for three months ended January 31, 2013 and 2012, respectively. For the nine months ended January 31, 2013 and 2012, excluding stock-based compensation of $1.9 million and $2.6 million, Champions recognized a net loss of $2.3 million, or ($0.05) per share and a net loss of $3.5 million, or ($0.07) per share, respectively.
<h2>Operating Results</h2>
<b>Personalized Oncology Solutions (POS):</b>

POS unit volumes continued to grow rapidly during the quarter. The number of implants during the quarter and year to date was 41 and 113, an increase of 64% and 61% over the same periods last year. The increase in implants is the result of growing visibility with patients and physicians, an increase in the number of free implants offered to physicians to enable them to get direct experience with TumorGraft technology and the recent opening of an office in Singapore. The number of patients for whom studies were completed was 11 and 34 for the quarter and year to date, an increase of 160% and 209% over the same periods last year. The increase in patient studies is the result of higher implant volumes in the recent quarters which lead to studies in subsequent quarters. POS revenues were $0.5 million and $0.7 million for the three months ended January 31, 2013 and 2012, respectively, a decrease of $0.2 million, or 28%. For the nine months ended January 31, 2013 and 2012, POS revenues were $1.9 million and $1.8 million, respectively, an increase of $0.1 million, or 6%. The changes in POS revenues were driven by the increased number of implants and drug studies completed during the three and nine months ended January 31, 2013 compared to the same period in the previous year, offset by a decline in pricing. The decline in pricing is part of the company’s strategy to increase volumes to grow the TumorBank and provide physician’s with more experience with TumorGraft technology. In addition, revenue during the three months ended January 31, 2012 included two very large studies that generated more than $150,000 each.

POS cost of sales was $0.7 million and $0.5 million for the three months ended January 31, 2013 and 2012, respectively, an increase of $0.2 million, or 40%. For the nine months ended January 31, 2013 and 2012, POS cost of sales was $2.0 million and $1.5 million, respectively, anincrease of $0.5 million, or 33%. For the three months ended January 31, 2013 and 2012, gross margins for POS were -40% and 29%, respectively. For the nine months ended January 31, 2013 and 2012, gross margins for POS were -5% and 17%, respectively. The increases in cost of sales and the declines in gross margins can be attributed to increased volumes of implants and drug studies performed, in line with management’s strategy to obtain more tumors to increase our tumor model offerings to our TOS sponsors and increase the number of models in our Tumorbank.

<b>Translational Oncology Solutions (TOS):</b>

TOS revenues were $2.4 million and $1.7 million for the three months ended January 31, 2013 and 2012, respectively, an increase of $0.7 million, or 41%. TOS revenues were $4.6 million and $3.9 million for the nine month periods ending January 31, 2013 and 2012, respectively, an increase of $0.7 million, or 18%. The increase in TOS revenues was due primarily to the one-time payment from the successful completion of a TumorGraft technology collaboration with a subsidiary of Teva Pharmaceutical Industries.

TOS cost of sales was $0.6 million and $0.8 million for the three months ended January 31, 2013 and 2012, respectively, a decrease of $0.2 million, or 25%. For the nine months ended January 31, 2013 and 2012, TOS cost of sales was $1.7 million and $1.9 million, respectively, decrease of $0.2 million, or 11%. For the three months ended January 31, 2013 and 2012, gross margins for TOS were 75% and 53%. For the nine months ended January 31, 2013 and 2012, gross margins for TOS were 63% and 51%, respectively.

Research and development expense was $0.6 million and $0.9 million for three months ended January 31, 2013 and 2012, respectively, a decrease of $0.3 million, or 33%. For the nine months ended January 31, 2013 and 2012, research and development expense was $1.4 million and $2.5 million, respectively, a decrease of $1.1 million, or 44%. This decrease is primarily related to decreased laboratory maintenance costs associated with research and development efforts, in line with our strategy to focus on our POS and TOS lines of business. Additionally, the decrease can be attributed to decreased tumor procurement costs, resulting from our strategy to source models from our POS business.

Sales and marketing expense was $0.6 million and $0.6 million for the three months ended January 31, 2013 and 2012. For the nine months ended January 31, 2013 and 2012, sales and marketing expense was $2.1 million and $1.9 million, respectively, an increase of $0.2 million, or 11%.

General and administrative expense was $1.1 million and $1.3 million for the three months ended January 31, 2013 and 2012, respectively, a decrease of $0.2 million, or 15%. For the nine months ended January 31, 2013 and 2012, general and administrative expense was $3.5 million and $4.4 million, respectively, a decrease of $0.9 million, or 21%. 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.

<b>Conference Call Information:</b>

The Company will host a conference call on Thursday, March 14, 2013, at 8:30 a.m. ET to discuss its third quarter financial results. To access the conference call, domestic participants should dial 800-874-4559, Canadian participants should dial 800-696-0876, and international participants should dial 302-607-2019. The participant passcode is “Champions Oncology”.

Full details of the Company’s financial results will be available in the Company’s Form 10-Q at www.championsoncology.com.

<b>* Non-GAAP Financial Information</b>

See the attached Reconciliation of GAAP Net Loss to Non-GAAP Net Loss for an explanation of the amounts excluded to arrive at non-GAAP net loss and related non-GAAP loss per share amounts for the three and nine months ended January 31, 2013 and 2012. Non-GAAP financial measures provide investors and management with supplemental measures of operating performance and trends that facilitate comparisons between periods before and after certain items that would not otherwise be apparent on a GAAP basis. Certain unusual or non-recurring items that management does not believe affect the Company’s basic operations do not meet the GAAP definition of unusual or non-recurring items. Non-GAAP net loss and non-GAAP loss per share are not, and should not be viewed as a substitute for similar GAAP items. We define non-GAAP diluted loss per share amounts as non-GAAP net loss divided by the weighted average number of diluted shares outstanding. Our definition of non-GAAP net loss and non-GAAP diluted loss per share may differ from similarly named measures used by others.

Champions Oncology - Specializing in | Personalized Cancer Therapy | Translational Oncology Solutions | Oncology drug development | Oncology drug discovery | Translational oncology | Translation oncology research | Predictive oncology | Patient-derived xenograft model | Tumorgrafts | Alternative/new cancer treatment | Anticancer therapies | Personalized cancer treatment | Personalized cancer therapy | Personalized oncology