Chemokine Therapeutics announces 2006 financial and operating results



    TSX: CTI  OTCBB: CHKT

    VANCOUVER, April 16 /CNW/ - Chemokine Therapeutics Corp. (the "Company")
(TSX:CTI, OTCBB:CHKT), a biotechnology company developing chemokine-based
therapies to treat cancer, blood disorders, and vascular diseases, today
announced highlights and the financial and operating results of the year ended
December 31, 2006.

    
    2006 Highlights:

        -  Commencement and continued enrollment of subjects to the
           Phase Ib/II clinical study of CTCE-9908 to assess the safety and
           signs of efficacy of CTCE-9908 after repeated administration in
           late stage cancer patients.

        -  Collaborations with several prestigious academic institutions to
           study the benefits of CTCE-9908 in brain and breast cancers and to
           study the potential of CTCE-0214 to accelerate the repopulation of
           stem cells in the bone marrow from human umbilical cord blood.

        -  Encouraging results from the Phase Ib clinical trial program for
           CTCE-0214 in stem cell and white blood cell mobilization.

        -  Demonstration that CTCE-0324 enhances the survival of endothelial
           cells (essential components of existing blood vessels), stimulates
           the organization of endothelial cells into coordinated tube-like
           structures and induces new blood vessel type structures to sprout
           from pre-existing vessels using cell culture systems.

        -  Issuance of US Patent "Chemokine Analogs for the Treatment of
           Human Disease". The patent covers Chemokine analogs that are
           useful for the treatment of a variety of diseases and disorder
           including cancer, autoimmune diseases, and inflammation. The
           Company currently has a portfolio of 64 patents and patent
           applications that the Company either owns or has licensed around
           its key products and technologies.

        -  Strengthening of the Company's management team with the
           appointment of Dr. Guy Ely to serve as Chief Medical Officer and
           Mr. Bashir Jaffer to serve as Chief Financial Officer.

        -  Closing of a CDN$6.9 million private placement which provided
           further capital to fund the Company's pre-clinical and clinical
           development.

    Subsequent events

        -  Positive preliminary data and the successful completion of the
           dose-escalation portion of the Phase Ib/II clinical trial for
           CTCE-9908, the Company's anti-cancer drug candidate.

        -  The appointment of C. Richard Piazza as the new Chief Executive
           Officer.
    

    Financial Results - Audited
    (All amounts in U.S. dollars and in accordance with U.S. GAAP unless
    otherwise specified)

    The Company incurred a net loss of $7,507,866 ($0.19 per share) compared
to $6,020,166 ($0.19 per share) during the twelve months ended December 31,
2006 and 2005, respectively. The increase in our net loss was principally
caused by the increase in research and development expenditures as well as
general and administrative expenses as described below.
    The Company had no revenues in the twelve months ended December 31, 2006,
compared to $275,000 for the twelve months ended December 31, 2005. In fiscal
2005, we recorded revenues of $275,000 from a research collaboration with
Proctor & Gamble involving an evaluation of our compounds for cardiovascular
applications. The decrease in revenues was due to the one-time nature of the
$275,000 payment from Proctor & Gamble under our research collaboration.
    Research and development expenses were $4,642,457 during the twelve
months ended December 31, 2006, an increase of $945,452 from the $3,697,005
comparative amount recorded in the twelve months ended December 31, 2005. The
increase in research and development expenses in fiscal 2006 was primarily
attributable to the increased expenses associated with our two lead compounds,
CTCE-0214 and CTCE-9908, and our continued efforts with our other early
research activities. Research and development expenses include contract
research, manufacturing, laboratory supplies, staff salaries and a $100,000
payment to Pharmaceutical Product Development Inc. (PPDI) to re-acquire the
rights to our CTCE-0214 compound.
    Direct costs for CTCE-0214 were approximately $1,735,000 for the twelve
months ended December 31, 2006, compared to $1,874,000 for the twelve months
ended December 31, 2005.
    The Company recorded direct costs for CTCE-9908 of approximately
$1,776,000 for the twelve months ended December 31, 2006, which included costs
of preparatory and clinical trial costs for the Phase Ib/II clinical trial
currently underway, and related manufacturing of compound. This compares to
approximately $1,276,800 for the twelve months ended December 31, 2005.
    Research and development expenses are expected to increase in the future
as and when we incur costs for clinical trials. Completion dates and
completion costs to bring a drug candidate to market vary significantly for
each drug candidate given the nature of the clinical trials and the fact that
more clinical trials may need to be conducted to advance a drug candidate
based upon the results of each phase. In addition, we anticipate partnering
with larger pharmaceutical companies to conduct and finance later stage
clinical trials and therefore the timing of completion of the approval of a
drug will likely not be within our control. Based on these factors we cannot
reasonably estimate the completion dates and completion costs required to gain
regulatory approval of our compounds for sale. Drug candidates are required to
successfully complete Phase III clinical trials before gaining regulatory
approval for sale which for our drug candidates is not expected to occur for
several years.
    General and administrative expenses for the twelve months ended
December 31, 2006 were $2,904,595, compared to $2,667,290 for the twelve
months ended December 31, 2005. The year over year increase of $237,305
reflects additional salary costs as a result of our adding personnel to
support the continued growth in our research and development infrastructure.
Other general and administrative expenses included consulting, marketing and
promotion expenses incurred for business development.
    Interest income was $331,190 for the twelve months ended December 31,
2006 compared with $231,654 for the twelve months ended December 31, 2005.
Interest income was primarily interest earned on cash balances and investments
which benefited from increasing interest rates.
    As of December 31, 2006, we had approximately $6.1 million in cash and
cash equivalents and short term investments on hand, compared to approximately
$6.3 million as of December 31, 2005, a decrease of $0.2 million. Our working
capital at December 31, 2006 was approximately $5.9 million, compared to
approximately $6.3 million at December 31, 2005, a decrease of $0.4 million.
    We believe that our current funds will be sufficient to fund our
operations until January 31, 2008. However, our forecast of the period of time
through which our financial resources will be adequate to support our
operations is a forward-looking statement that involves risks and
uncertainties, and actual results could vary materially. If we are unable to
raise additional capital when required or on acceptable terms, we may have to
significantly delay, scale back or discontinue one or more of our clinical
trials or our operations.

    About Chemokine Therapeutics Corp. (TSX: CTI, OTCBB: CHKT)
    Chemokine Therapeutics is a product-focused biotechnology company
developing drugs in the field of chemokines. Chemokines are a class of
signaling proteins which play a critical role in the growth, differentiation
and maturation of cells necessary for fighting infection as well as tissue
repair and regeneration. Chemokines also have an important role in cancer
metastasis and growth. Chemokine Therapeutics is a leader in research in the
field of chemokines and has several products in various stages of development.

    Safe Harbor Statement under the U. S. Private Securities Litigation
Reform Act of 1995: Statements in this document regarding managements' future
expectations, beliefs, goals, plans or prospects constitute forward-looking
statements that involve risks and uncertainties, which may cause actual
results to differ materially from the statements made. For this purpose, any
statements that are contained herein that are not statements of historical
fact may be deemed to be forward-looking statements. Without limiting the
foregoing, the words "believes", "anticipates", "plans", "intends", "will",
"should", "expects", "projects", and similar expressions are intended to
identify forward-looking statements. You are cautioned that such statements
are subject to a multitude of risks and uncertainties that could cause actual
results, future circumstances, or events to differ materially from those
projected in the forward-looking statements. These risks include, but are not
limited to, those associated with the success of research and development
programs, the regulatory approval process, competition, securing and
maintaining corporate alliances, market acceptance of the Company's products,
the availability of government and insurance reimbursements for the Company's
products, the strength of intellectual property, financing capability, the
potential dilutive effects of any financing, reliance on subcontractors and
key personnel and other risks detailed from time-to-time in the Company's
public disclosure documents and other filings with the U.S. Securities and
Exchange Commission and Canadian securities regulatory authorities.
Forward-looking statements are made as of the date hereof, and the Company
disclaims any intention and has no obligation or responsibility, except as
required by law, to update or revise any forward-looking statements, whether
as a result of new information, future events, or otherwise.

    
                         Chemokine Therapeutics Corp.
                        (A Development Stage Company)
                         CONSOLIDATED BALANCE SHEETS

                                                          December 31,
                                                 ----------------------------
                                                      2006           2005
                                                 -------------  -------------
    ASSETS

    CURRENT ASSETS
      Cash and cash equivalents                  $  4,446,668   $  3,719,163
      Short term investments                        1,642,308      2,627,760
      Amounts receivable                               60,366         33,214
      Prepaid expense and deposits                    103,816        154,969
                                                 -------------  -------------

    TOTAL CURRENT ASSETS                            6,253,158      6,535,106

    PROPERTY AND EQUIPMENT, net                       332,440        351,438

    LICENSE COSTS, net                                 16,299         23,993

    AMOUNT DUE FROM AFFILIATE                         253,263         91,783
                                                 -------------  -------------

                                                 $  6,855,160   $  7,002,320
                                                 -------------  -------------
                                                 -------------  -------------

    LIABILITIES

    CURRENT LIABILITIES
      Accounts payable and accrued liabilities   $    377,915   $    253,199
      Current portion of capital lease obligation      12,392         11,648
                                                 -------------  -------------

    TOTAL CURRENT LIABILITIES                         390,307        264,847

    CAPITAL LEASE OBLIGATION                            8,722         21,157
                                                 -------------  -------------

                                                      399,029        286,004
                                                 -------------  -------------

    COMMITMENTS

    STOCKHOLDERS' EQUITY

    PREFERRED STOCK
      Authorized - 6,000,000 shares;
       par value $ 0.001 per share
      Issued and outstanding shares: December 31,
       2006 - Nil; December 31, 2005 - 2,000,000            -          2,000

    COMMON STOCK
      Authorized - 100,000,000 shares;
       par value $ 0.001 per share
      Issued and outstanding shares: December 31,
       2006 - 42,183,748; December 31,
       2005 - 31,897,206                               42,184         31,897

    ADDITIONAL PAID-IN CAPITAL                     30,957,359     23,717,965

    (DEFICIT) ACCUMULATED DURING THE
     DEVELOPMENT STAGE                            (24,543,412)   (17,035,546)
                                                 -------------  -------------

                                                    6,456,131      6,716,316
                                                 -------------  -------------

                                                 $  6,855,160   $  7,002,320
                                                 -------------  -------------
                                                 -------------  -------------

    See Edgar or Sedar for accompanying notes.



                         Chemokine Therapeutics Corp.
                        (A Development Stage Company)
                    CONSOLIDATED STATEMENTS OF OPERATIONS

                                                                 Cumulative
                                                               from inception
                                                                 on July 15,
                                    Years ended December 31,       1998 to
                                  ----------------------------   December 31,
                                       2006           2005           2006
                                  -------------  -------------  -------------
    REVENUE                       $          -   $    275,000   $    275,000
                                  -------------  -------------  -------------

    EXPENSES
      Research and development       4,642,457      3,697,005     14,595,725
      General and administrative     2,904,595      2,667,290     10,253,596
      Stock-based compensation         184,085        289,533        558,119
      Amortization of license            7,694          7,694         34,304
      Depreciation & amortization
       of property and equipment       173,350         46,684        346,091

                                  -------------  -------------  -------------

                                     7,912,181      6,708,206     25,787,835
                                  -------------  -------------  -------------
    OTHER INCOME
      Foreign exchange gain             73,125        181,386        366,945
      Interest income                  331,190        231,654        602,478
                                  -------------  -------------  -------------

    NET LOSS                      $ (7,507,866)  $ (6,020,166)  $(24,543,412)
                                  -------------  -------------  -------------
                                  -------------  -------------  -------------

    NET LOSS PER COMMON SHARE -
    BASIC AND DILUTED             $      (0.19)  $      (0.19)
                                  -------------  -------------
                                  -------------  -------------

    WEIGHTED AVERAGE NUMBER OF
    COMMON SHARES OUTSTANDING       39,606,809     31,605,162
                                  -------------  -------------
                                  -------------  -------------

    See Edgar or Sedar for accompanying notes



                         Chemokine Therapeutics Corp.
                        (A Development Stage Company)
                    CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                                 Cumulative
                                                               from inception
                                                                 on July 15,
                                                                   1998 to
                                    Years ended December 31,     December 31,
                                       2006           2005           2006
                                  -------------  -------------  -------------
    CASH FLOW FROM OPERATING
     ACTIVITIES
      Net loss                    $ (7,507,866)  $ (6,020,166)  $(24,543,412)
      Adjustments to reconcile
       net cash provided (used)
       by operating activities
        Depreciation and
         amortization                  181,044         54,378        380,395
        Common stock issued for
         consulting services                 -              -      1,033,669
        Warrants issued for
         consulting services                 -              -        404,842
        Options issued for
         consulting services                 -              -         87,968
        Stock-based compensation       184,085        289,533        558,119
        Decrease (increase) in
          Amounts receivable           (27,152)       (27,654)       (60,366)
          Prepaid expense and
           deposit                      51,153        (97,071)      (103,816)
        Increase (decrease) in
          Accounts payable and
           accrued liabilities         124,716       (359,968)       377,915
          Deferred revenue                   -       (275,000)             -
                                  -------------  -------------  -------------

        Cash (used) by operating
         activities                 (6,994,020)    (6,435,948)   (21,864,686)
                                  -------------  -------------  -------------

    CASH FLOW FROM FINANCING
     ACTIVITIES
      Stock issued for cash          7,489,823      2,023,872     31,647,476
      Stock issued for settlement
       of debt                               -              -        200,000
      Offering costs                  (426,228)      (213,682)    (2,974,596)
      Net advances (to) from
       affiliate                      (161,480)      (118,105)      (206,445)
      Capital lease payment            (11,691)        (1,845)       (13,536)
                                  -------------  -------------  -------------

      Cash provided by financing
       activities                    6,890,424      1,690,240     28,652,899
                                  -------------  -------------  -------------

    CASH FLOW FROM INVESTING
     ACTIVITIES
      Cash held by disposed
       subsidiary                            -              -         (4,754)
      Purchase of short term
       investments                 (10,185,725)    (6,185,883)   (16,371,608)
      Redemption of short term
       investments                  11,171,178      3,558,123     14,729,301
      Payment under license
       agreement                             -              -        (50,603)
      Purchase of property and
       equipment                      (154,352)      (343,847)      (643,881)
                                  -------------  -------------  -------------

      Cash provided (used) by
       investing activities            831,101     (2,971,607)    (2,341,545)
                                  -------------  -------------  -------------

    INCREASE (DECREASE) IN CASH
     AND CASH EQUIVALENTS DURING
     THE PERIOD                        727,505     (7,717,315)     4,446,668

    CASH AND CASH EQUIVALENTS,
     beginning of period             3,719,163     11,436,478              -
                                  -------------  -------------  -------------

    CASH AND CASH EQUIVALENTS,
     end of period                $  4,446,668   $  3,719,163   $  4,446,668
                                  -------------  -------------  -------------
                                  -------------  -------------  -------------

    See Edgar or Sedar for accompanying notes.
    





For further information:

For further information: Chemokine Therapeutics Corp., Mr. Don Evans,  
Director of Public Relations, Phone: (604) 822-0305 or 1-888-822-0305, Fax:
(604) 822-0302, E-mail: devans@chemokine.net, Internet: www.chemokine.net;
Equicom Group, Joanna Longo, Investor Relations, Phone: (416) 815-0700 ext.
233, Fax: (416) 815-0080, E-mail: jlongo@equicomgroup.com

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CHEMOKINE THERAPEUTICS CORP.

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