IVAX Diagnostics Releases Fourth Quarter and Full Year 2007 Results

MIAMI--(Business Wire)--
IVAX Diagnostics, Inc. (AMEX:IVD) reported net revenues for the
year ended December 31, 2007 of $19,976,000, an increase of 2.3%
compared to net revenues of $19,523,000 for the year ended December
31, 2006. For the full year 2007, net loss was $10,434,000, compared
to net loss of $2,809,000 for the full year 2006. Net revenues for the
fourth quarter of 2007 were $4,937,000, an increase of 7.6% compared
to net revenues of $4,590,000 from the same period of the previous
year. Net loss for the fourth quarter of 2007 was $1,892,000, compared
to net loss of $626,000 for the fourth quarter of 2006.

Kevin Clark, acting Chief Executive Officer and Chief Operating
Officer of IVAX Diagnostics, said, "Although net loss increased
significantly in 2007 from 2006, this increase was primarily the
result of the significant changes we undertook during 2007 in an
effort to improve our cash flow and increase our stockholders' value
in the future. Specifically, net loss in 2007 included the
tax-affected impact of $9,064,000 of previously reported one-time
third quarter 2007 non-cash write-offs and a one-time fourth quarter
2007 accrual for severance related costs, while net loss in 2006
included the impact of previously reported one-time non-cash
write-offs and adjustments totaling $710,000. The previously reported
one-time third quarter 2007 non-cash write-offs were comprised of
goodwill totaling $5,852,000 and PARSEC(R) System related assets
totaling $1,674,000, and the one-time severance related costs of
$1,998,000 included in general and administrative expenses were
incurred during the fourth quarter of 2007 in connection with
management and other personnel changes. The previously reported third
quarter 2007 non-cash write-off of PARSEC(R) System related assets and
the fourth quarter 2007 incurrence of severance related costs were
each related to our previously announced change in strategic direction
to focus on the development of the Mago(R) 4 as a platform for
marketing our kits and to place any further development of the
PARSEC(R) System on hold indefinitely. Although this change in
strategic direction resulted in significant non-cash write-offs and
other non-recurring expenses during 2007, we believe that we are now
better positioned to focus on our core business and to achieve
profitability in the future, as reflected by our improved fourth
quarter results excluding one-time charges. We expect that our
decision to focus on the development of our proprietary Mago(R) 4
platform, the upgraded version of our Mago(R) Plus instrument, will
allow us to broaden our product portfolio of diagnostic assays and
continue to deliver to our customers the technological innovation that
they expect from us. We also expect to be able to leverage our
refocused efforts by selectively partnering on other new projects with
other established diagnostics industry companies. Now that our change
in strategic direction is behind us, we intend to continue to build
upon our core business and strengthen our position."

About IVAX Diagnostics, Inc.

IVAX Diagnostics, Inc., headquartered in Miami, Florida, develops,
manufactures and markets proprietary diagnostic reagents,
instrumentation, and software in the United States and Italy through
its three subsidiaries: Diamedix Corporation, Delta Biologicals
S.r.l., and ImmunoVision, Inc. Teva Pharmaceutical Industries Limited,
through its wholly-owned IVAX Corporation subsidiary, owns
approximately 72% of IVAX Diagnostics, Inc.

Except for the historical matters contained herein, statements in
this press release are forward-looking and are made pursuant to the
safe harbor provisions of the Private Securities Litigation Reform Act
of 1995. Investors are cautioned that forward-looking statements
involve risks and uncertainties that may affect the business and
prospects of IVAX Diagnostics, Inc., including, without limitation:
that IVAX Diagnostics may not successfully implement the change in its
strategic direction to focus on the development of the Mago(R) 4 as a
platform for marketing its kits and to place any further development
of the PARSEC(R) System on hold indefinitely; that IVAX Diagnostics
may not achieve improved cash flow or increased stockholders' value as
a result of its implementation of the change in strategic direction
described above; that the implementation of the change in strategic
direction described above will not successfully position IVAX
Diagnostics to focus on its core business or achieve profitability
when expected or at all; risks and uncertainties regarding the
PARSEC(R) System, including, without limitation, that the PARSEC(R)
System may not ever be available, and that IVAX Diagnostics'
international activities associated with the PARSEC(R) System will be
adversely impacted by the change in strategic direction described
above; risks and uncertainties regarding the Mago(R) 4, including,
without limitation, that the Mago(R) 4 may not perform as or be
available when expected or at all, that IVAX Diagnostics may not be
able to obtain all necessary regulatory approvals for the Mago(R) 4
when expected or at all, that IVAX Diagnostics may not broaden its
product portfolio of diagnostic assays or continue to deliver to its
customers the technological innovation that they expect from IVAX
Diagnostics as a result of its focus on the development of the Mago(R)
4, that IVAX Diagnostics may not be successful in its marketing of the
Mago(R) 4, that customers may not integrate the Mago(R) 4 into their
operations as readily as expected, and that sales and reagent rentals
of the Mago(R) 4 may adversely affect sales and reagent rentals of the
Mago(R) Plus; that IVAX Diagnostics may not be able to successfully
leverage its refocused efforts by selectively partnering on other new
projects with other established diagnostics industry companies; in the
event IVAX Diagnostics partners on other new projects with other
established diagnostics industry companies, that any such partnerships
may not be successful or otherwise result in improved financial
performance or results for IVAX Diagnostics; that IVAX Diagnostics
will not successfully build upon its core business and strengthen its
position; that improved financial performance or results may not
occur; and other risks and uncertainties that may cause results to
differ materially from those set forth in the forward-looking
statements. In addition to the risks and uncertainties set forth
above, investors should consider the economic, competitive,
governmental, technological and other risks and uncertainties
discussed in IVAX Diagnostics' filings with the Securities and
Exchange Commission, including, without limitation, the risks and
uncertainties discussed under the heading "Risk Factors" in such
filings.

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IVAX DIAGNOSTICS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Twelve Months
Period Ended
December 31, 2007 2006 2007 2006
------------ ------------ ------------- ------------

NET REVENUE $ 4,936,752 $ 4,590,355 $ 19,975,870 $19,523,471

COST OF SALES 2,089,927 1,915,011 8,399,399 8,457,855
------------ ------------ ------------- ------------
Gross profit 2,846,825 2,675,344 11,576,471 11,065,616
------------ ------------ ------------- ------------

OPERATING
EXPENSES:
Selling 1,402,397 1,529,004 5,485,532 5,883,610
General and
administrative 2,959,854 1,404,943 7,730,164 5,652,392
Research and
development 539,339 416,607 2,152,114 1,894,971
Write-off of
PARSEC(R)
related assets - - 1,673,824 509,000
Impairment of
goodwill - - 5,852,435 -
------------ ------------ ------------- ------------
Total
operating
expenses 4,901,590 3,350,554 22,894,069 13,939,973
------------ ------------ ------------- ------------

Loss from
operations (2,054,765) (675,210) (11,317,598) (2,874,357)
------------ ------------ ------------- ------------

OTHER INCOME,
NET:
Interest income 158,852 112,664 435,575 463,882
Other income
(expense), net 37,843 36,504 119,515 (44,380)
------------ ------------ ------------- ------------
Total other
income, net 196,696 149,168 555,090 419,502
------------ ------------ ------------- ------------

Loss before
income taxes (1,858,070) (526,042) (10,762,508) (2,454,855)

INCOME TAX
PROVISION
(BENEFIT) 34,070 100,400 (328,769) 153,379
------------ ------------ ------------- ------------

LOSS BEFORE
CUMULATIVE
EFFECT OF CHANGE
IN ACCOUNTING
PRINCIPLE (1,892,140) (626,442) (10,433,739) (2,608,234)
------------ ------------ ------------- ------------

CUMULATIVE EFFECT
OF CHANGE IN
ACCOUNTING
PRINCIPLE - - - (201,000)
------------ ------------ ------------- ------------

Net loss $(1,892,140) $ (626,442) $(10,433,739) $(2,809,234)
============ ============ ============= ============

Loss per share,
before
cumulative
effect of change
in accounting
principle
Basic and diluted $ (0.07) $ (0.02) $ (0.38) $ (0.09)
============ ============ ============= ============

Cumulative effect
of change in
accounting
principle, per
share
Basic and diluted $ - $ - $ - $ (0.01)
============ ============ ============= ============

Loss per share
Basic and diluted $ (0.07) $ (0.02) $ (0.38) $ (0.10)
============ ============ ============= ============

WEIGHTED AVERAGE
SHARES
OUTSTANDING:
Basic 27,649,887 27,649,887 27,649,887 27,639,221
============ ============ ============= ============
Diluted 27,649,887 27,649,887 27,649,887 27,639,221
============ ============ ============= ============
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IVAX DIAGNOSTICS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2007 and 2006

2007 2006
------------ ------------
ASSETS
--------------------------------------------

CURRENT ASSETS:
Cash and cash equivalents $ 3,900,564 $ 1,995,730
Marketable securities 1,925,000 6,650,000
Accounts receivable, net of allowances for
doubtful accounts of $1,052,797 and
$1,093,070, respectively 6,287,654 7,489,272
Inventories, net 4,013,312 5,557,528
Other current assets 374,579 1,183,571
------------ ------------
Total current assets 16,501,109 22,876,101
------------ ------------

PROPERTY, PLANT AND EQUIPMENT:
Land 352,957 352,957
Buildings and improvements 3,039,902 2,985,081
Machinery and equipment 2,534,084 2,825,404
Furniture and fixtures 1,887,369 1,788,170
------------ ------------
7,814,312 7,951,612
Less - Accumulated depreciation (5,969,020) (5,650,032)
------------ ------------
1,845,292 2,301,580
------------ ------------
OTHER ASSETS:
Marketable securities 4,100,000 -
Goodwill 870,290 6,722,725
Equipment on lease, net 163,113 386,762
Product license 1,242,936 1,255,936
Other 1,045,592 163,998
------------ ------------
7,421,931 8,529,421
------------ ------------

Total assets $25,768,332 $33,707,102
============ ============
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LIABILITIES AND SHAREHOLDERS' EQUITY
--------------------------------------------

CURRENT LIABILITIES:
Accounts payable $1,217,408 $935,896
Accrued license payable 147,184 526,800
Accrued expenses 5,404,372 3,048,285
------------ ------------
Total current liabilities 6,768,964 4,510,981
------------ ------------

OTHER LONG-TERM LIABILITIES:
Deferred tax liabilities 174,708 572,089
Other long-term liabilities 850,177 885,890
------------ ------------
Total other long-term liabilities 1,024,885 1,457,979
------------ ------------

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY:
Common stock, par value $0.01, authorized
50,000,000 shares, issued and outstanding
27,649,887 in 2007 and 2006 276,498 276,498
Additional paid-in capital 40,910,677 40,781,825
Accumulated deficit (23,209,941) (12,776,202)
Accumulated other comprehensive loss (2,751) (543,979)
------------ ------------
Total shareholders' equity 17,974,483 27,738,142
------------ ------------
Total liabilities and
shareholders' equity $25,768,332 $33,707,102
============ ============
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IVAX Diagnostics, Inc., Miami
Duane M. Steele, 305-324-2338
www.ivaxdiagnostics.com

Copyright Business Wire 2008