Sontra Medical Reports Third Quarter 2006 Results and Business Update

FRANKLIN, Mass., Nov. 20 /PRNewswire-FirstCall/ -- Sontra Medical Corporation announced financial results today for the third quarter ended September 30, 2006. For the three months ended September 30, 2006, the net loss applicable to common stockholders was $1,389,882, or $.49 per common share, as compared to $1,510,797 or $.68 per common share, for the same period in 2005. For the nine months ended September 30, 2006, the net loss applicable to common stockholders was $4,229,286, or $1.60 per common share, as compared to $4,556,259 or $2.05 per common share, for the same period in 2005. As of September 30, 2006, the Company had a total of $1,677,256 in cash and short term investments.

On July 24, 2006, the Company's Board of Directors approved a 1-for-10 reverse stock split. The reverse stock split was effective at 5:00 p.m. on August 10, 2006, and the Company's common stock began trading on a split adjusted basis on August 11, 2006. All share and per share information presented herein have been retroactively restated to reflect the reverse stock split. The Company expects that cash and short term investments of $1,677,256 at September 30, 2006 ($1,216,029 at November 20, 2006) will be sufficient to meet its cash requirements through December 2006. Currently, the Company is meeting with several potential private investors to raise capital to meet its working capital and its forecasted operating costs and expenses beyond December 31, 2006. The Company has engaged a financial consultant to provide introductions to potential investors. Over the past year, the Company has experienced a decline in investors interested in making an investment in the Company. If we do not raise additional capital by December 31, 2006 (as debt or equity), then we will run out of cash and will be unable to continue operations. We are continuing to pursue additional capital through several potential identified investors but have not received a commitment for financing at this time. If we do not raise additional capital, the Board of Directors of the Company may decide to initiate an orderly wind-down of business operations or to file for bankruptcy protection under the United States Bankruptcy Code. In the event that we wind-down our business or file for bankruptcy, there would likely be little or no proceeds available for our stockholders.

"While we have worked, and continue diligently working, to raise additional cash for the Company's development and working capital needs, we have also remained focused on the development and on-going clinical evaluations of our Symphony Continuous Glucose Monitor (CTGM)," stated Thomas W. Davison, PhD, Sontra's President and Chief Executive Officer. Dr. Davison added, "Clinical trials of our Symphony Continuous Transdermal Glucose Monitor (CTGM) are underway at a major Boston, Massachusetts Medical Center. The study has enrolled 30 patients and preliminary data analysis verified that the Symphony system is effective for continuous glucose monitoring in patients undergoing open heart surgery in the operating room and cardiac care unit. Recently, we expanded this clinical trial to enroll up to 65 cardiac surgery patients. Assuming we are successful in obtaining the necessary capital to continue the Company's operations, we expect to initiate a multi-center clinical study in the first quarter of 2007 that will enroll critically ill patients in surgical and medical intensive care units."

About Sontra Medical Corporation (http://www.sontra.com/)

Sontra Medical Corporation is a technology leader in transdermal science and is developing a non-invasive, continuous transdermal glucose monitor ("CTGM") for principal use in the Intensive Care Market. Through its platform technology, the SonoPrep(R) Permeation System, combined with technical competencies in transdermal drug formulation, analysis, delivery systems and biosensors, the Company is creating a new paradigm in transdermal drug delivery and diagnosis. The CTGM and other company products are being developed for several billion dollar market opportunities, all utilizing skin permeation, chemistry and biosensor technology developed by the Company. In addition, the Company owns technology for transdermal delivery of large molecule drugs and vaccines.

Any statements contained in this press release that do not describe historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Any forward-looking statements contained herein are based on current expectations, but are subject to a number of risks and uncertainties. The factors that could cause actual future results to differ materially from current expectations include, but are not limited to, risks and uncertainties relating to the Company's ability to develop, market and sell products based on its technology, including a continuous transdermal glucose monitor for the hospital ICU market; the expected size of the market for the continuous transdermal glucose monitor for the hospital ICU market; the expected benefits and efficacy of the SonoPrep device in connection with diagnostics, vaccine delivery, glucose monitoring and transdermal science; the availability of substantial additional funding to continue our operations and to conduct research and development, clinical studies and future product commercialization; and, the Company's business, research, product development, regulatory approval, marketing and distribution plans and strategies. These and other factors are identified and described in more detail in our filings with the SEC, including, without limitation, our respective annual reports on Form 10-KSB for the year ended December 31, 2005, our most recent quarterly reports on Form 10-QSB, and our current reports on Form 8-K. We do not undertake to update these forward-looking statements made by us.

SonoPrep is a registered trademark of Sontra Medical Corporation. All other company, product or service names mentioned herein are the trademarks or registered trademarks of their respective owners.

Investor Relations Contacts: Harry G. Mitchell, CFO [e-mail] MEDICAL CORPORATION Consolidated Balance Sheets As of, September 30, December 31, 2006 2005 (Unaudited) ASSETS Current Assets: Cash and cash equivalents $677,256 $1,016,792 Short term investments 1,000,000 3,000,000 Accounts receivable 44 1,129 Inventory, net of reserve for obsolescence 48,410 31,250 Prepaid expenses and other current assets 61,455 65,468 Total current assets 1,787,165 4,114,639 Property and Equipment, at cost: Computer equipment 248,175 241,324 Office and laboratory equipment 600,426 593,576 Furniture and fixtures 14,288 14,288 Manufacturing equipment 522,797 224,888 Leasehold improvements 177,768 177,768 1,563,454 1,251,844 Less-Accumulated depreciation and amortization (1,030,112) (894,658) Net property and equipment 533,342 357,186 Other Assets: Restricted cash 19,949 29,248 Deposits and other assets 2,000 207,012 Total other assets 21,949 236,260 Total assets $2,342,456 $4,708,085 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable $153,781 $210,208 Deferred revenue 7,499 45,000 Current portion of note payable 57,982 53,653 Accrued expenses 368,799 416,936 Total current liabilities 588,061 725,797 Note Payable, net of current portion 104,999 149,043 Commitments Stockholders' Equity: Series A Convertible Preferred Stock, $0.01 par value, authorized 7,000,000 shares, issued and outstanding 73,334 shares at September 30, 2006 and December 31, 2005 (preference in liquidation of $80,679) 80,679 76,291 Common stock, $0.01 par value, authorized 60,000,000 shares, issued and outstanding 2,976,295 shares at September 30, 2006 and 2,226,183 shares at December 31, 2005 29,763 22,262 Additional paid-in capital 34,883,548 32,858,548 Accumulated deficit (33,344,594) (29,123,856) Total stockholders' equity 1,649,396 3,833,245 Total liabilities and stockholders' equity $2,342,456 $4,708,085 (Reflects 1-for-10 reverse stock split effective August 11, 2006) Sontra Medical Corporation Consolidated Statements of Loss (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2006 2005 2006 2005 Revenue: Product revenue $10,679 $ 20,615 $ 37,619 $169,018 Licensing revenue 12,500 - 37,501 - Total revenue 23,179 20,615 75,120 169,018 Operating Expenses: Cost of product revenue 9,445 149,209 61,734 246,068 Research and development 803,754 998,026 2,489,996 2,943,821 Selling, general and administrative 622,518 427,564 1,843,535 1,681,341 Total operating expenses 1,435,717 1,574,799 4,395,265 4,871,230 Loss from operations (1,412,538) (1,554,184) (4,320,145) (4,702,212) Other Income (Expense): Interest income 28,604 50,670 109,687 163,151 Interest expense (4,469) (5,804) (14,439) (12,809) Other income, net 24,135 44,866 95,248 150,342 Net loss (1,388,403) (1,509,318) (4,224,897) (4,551,870) Accretion of dividend on Series A Convertible Preferred Stock (1,479) (1,479) (4,389) (4,389) Net loss applicable to common shareholders $(1,389,882) $(1,510,797) $(4,229,286) $(4,556,259) Net loss per common share, basic and diluted $(0.49) $(0.68) $(1.60) $(2.05) Basic and diluted weighted average common shares outstanding 2,839,201 2,223,396 2,640,691 2,218,635 (Reflects 1-for-10 reverse stock split effective August 11, 2006)