Datatrak International, the troubled US-based eClinical specialist that is considering a sale or merger among a range of options to maximise its shareholder value, reported operating losses of US$15.6 million for the second quarter, more than five times the US$3.0 million loss sustained in the three months ended 30 June 2007.

Revenues for the latest quarter were US$2.2 million, down by 26.6% on Q2 2007. A net loss of US$16.0 million (US$3.0 million one year earlier) included US$12.8 million in asset impairment charges, US$579,000 in severance expenses and a tax provision of US$385,000. The gross margin remained consistent at around 60% in both the 2008 and 2007 quarters.

Explaining the impairment of goodwill and other intangible assets, Datatrak noted that its market capitalization declined from around US$16.46 million as of 31 March 2008 to US$6.17 million at 30 June 2008. The severance expenses were mostly for the closure of Datatrak’s German office in Bonn, announced last June, and for scrapping the role of chief operating officer in May.

In all, 15 positions were eliminated during the second quarter, which is expected to cut annual direct costs by around US$686,000 and annual selling, general and administrative (SG&A) expenditure by about US$923,000. In July Datatrak took out another six positions, which should further reduce annual direct costs by around US$249,000 and SG&A expenses by roughly US$236,000.

Datatrak’s backlog as of 30 June was US$13.2 million and it currently stands at US$12.6 million. The backlog at 31 December 2007 was US$13.0 million. According to chief executive officer Dr Jeffrey Green, the company continues to sign up new business with both existing a new customers and was “very pleased” with the level of industry interest shown in its unified technology platform at the annual Drug Information Association conference in June.

As for the initiative under which Healthcare Growth Partners was retained to help consider strategic options for the struggling company, it is early days but “we are making process and are in early discussions regarding several opportunities”, Green said.