Oct. 29, 2009 (PR Newswire) -- REDWOOD CITY, Calif., Oct. 29 /PRNewswire-FirstCall/ -- Cardica, Inc. (Nasdaq: CRDC) today reported financial results for its fiscal 2010 first quarter ended September 30, 2009. Our financial results reflect a transition of our sales model related to our automated anastomotic systems used by cardiac surgeons to perform coronary bypass surgery and the expansion of our business through the development of an endoscopic microcutter intended for use by general, thoracic, gynecologic, bariatric and urologic surgeons.

"During the first quarter of fiscal 2010, we signed six new agreements with independent distributors and manufacturers' representatives, bringing our external sales team to 22. We utilized the summer months, during which typically there are fewer cardiac surgery procedures, to train our new sales representatives, preparing them to proctor bypass procedures using our automated anastomosis products moving forward. While our revised sales model using a core sales team supported by independent distributors and manufacturers' representatives remains to be proven, we believe that it will allow us to incrementally increase clinician adoption of our cardiac surgery products while controlling our costs," said Bernard A. Hausen, M.D., Ph.D., president and chief executive officer of Cardica.

"In addition, we completed a private placement that provided funding for the further development of the Cardica Microcutter, which applies our proprietary automated stapling technology outside of cardiac surgery and has potential use in a range of surgical applications, including bariatric, thoracic and general surgery. We continue to make strides in the development of our microcutter, and we intend to initiate animal testing in the first half of calendar 2010."

Recent Highlights and Accomplishments

--  Increased cumulative worldwide shipments of PAS-Port® Proximal
Anastomosis Systems to over 16,100 units, with a total of 1,186 units
sold in the first quarter of fiscal 2010;
--  Increased cumulative worldwide shipments of C-Port® Distal Anastomosis
Systems to over 9,500 units, with a total of 181 units sold in the first
quarter of fiscal 2010;
--  Expanded network of independent distributors and manufacturers'
representatives through the addition of six organizations: AlphaCor, Bio
Instruments, Ilex Medical, Medical Dynamics, MEDI-MAC Cardiovascular and
MedSurg Specialty Medical;
--  Raised $10 million in net proceeds through the sale of 8,142,082 shares
of common stock and warrants to purchase 4,071,046 shares of common
stock; and

--  Continued development of the Cardica Microcutter, a multi-fire
endolinear microcutter device based on Cardica's proprietary
"staple-on-a-strip" technology.

Fiscal 2010 First Quarter Financial Results

Net product sales totaled $0.8 million for the fiscal 2010 first quarter, compared to $1.6 million for the fiscal 2009 first quarter. Net product sales decreased as a result of Cardica's smaller direct sales force and the transition period necessary to train our new independent distributors and manufacturers' representatives and due to the lower number of cardiac surgery bypass procedures in the summer months of July and August. Total net revenue was $0.9 million for the fiscal 2010 first quarter, compared to $2.1 million for the same period of fiscal 2009. Cost of product sales decreased to $0.8 million for the fiscal 2010 first quarter, compared to $1.1 million in the fiscal 2009 first quarter.

For the fiscal 2010 first quarter, research and development expenses decreased to $1.1 million, compared to $2.3 million for the fiscal 2009 first quarter.