##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended June 30, 2007
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
 For
the transition period from ___ to ___.
 Commission File Number 0-51110
 VIACELL, INC.
 (Exact Name of Registrant as Specified in Its Charter)
 Delaware(State or Other Jurisdiction of 
Incorporation or Organization)
    
    04-3244816(I.R.S. Employer Identification No.)245 First Street, Cambridge, MA(Address of Principal Executive Offices)
    
    02142(Zip Code)
 (617) 914-3400  (Registrants telephone number, including area code)
 
 þ o
  o þ o
 o þ




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##### Table of Contents



ViaCell, Inc.
Quarterly Report on Form 10-Q
For the Fiscal Quarter Ended June 30, 2007
 NOTE ABOUT REFERENCES TO VIACELL
  NOTE ABOUT TRADEMARKS
 ® ® sm tm ® ® ® tm
 NOTE ABOUT FORWARD-LOOKING STATEMENTS
  2




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##### 



TABLE OF CONTENTS
 PagePART I  FINANCIAL INFORMATIONItem 1. Financial Statements (unaudited)Condensed Consolidated Balance Sheets  June 30, 2007 and December 31, 2006
    
    
    4Condensed Consolidated Statements of Operations  three and six months ended June 30, 2007 and June 30, 2006
    
    
    5Condensed Consolidated Statements of Comprehensive Loss  three and six months ended June 30, 2007 and June 30, 2006
    
    
    6Condensed Consolidated Statements of Cash Flows  Six months ended June 30, 2007 and June 30, 2006
    
    
    7Notes to Condensed Consolidated Financial Statements
    
    
    8Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    15Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    27Item 4. Controls and Procedures
    
    
    27PART II  OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    28Item 1A. Risk Factors
    
    
    28Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    44Item 3. Defaults upon Senior Securities
    
    
    44Item 4. Submission of Matters to a Vote of Security Holders
    
    
    45Item 5. Other Information
    
    
    45Item 6. Exhibits
    
    
    45Signatures
    
    
    46EXHIBITSIndex to Exhibits
    
    
    47EX-31.1 Section 302 Certification of CEOEX-31.2 Section 302 Certification of CFOEX-32.1 Section 906 Certification of CEOEX-32.2 Section 906 Certification of CFO
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PART I  FINANCIAL INFORMATION
 
 Item 1  Financial Statements
 ViaCell, Inc. and Subsidiaries
 
 Condensed Consolidated Balance Sheets
 (amounts in thousands, except share data)
 (unaudited)
 June 30,
    
    
    December 31,2007
    
    
    2006ASSETSCurrent assets:Cash and cash equivalents
    
    $
    10,439
    
    
    $
    18,039Short-term investments
    
    
    33,519
    
    
    
    33,206Accounts receivable, less allowances of
$2,190 and $1,436 at June 30, 2007 and
December 31, 2006, respectively
    
    
    13,426
    
    
    
    12,616Prepaid expenses and other current assets
    
    
    2,264
    
    
    
    2,008Total current assets
    
    
    59,648
    
    
    
    65,869Property and equipment, net
    
    
    7,902
    
    
    
    8,376Goodwill
    
    
    3,621
    
    
    
    3,621Intangible assets, net
    
    
    2,521
    
    
    
    2,621Restricted cash
    
    
    1,795
    
    
    
    1,795Total assets
    
    $
    75,487
    
    
    $
    82,282LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Current portion of long-term debt obligations
    
    $
    50
    
    
    $
    55Accounts payable
    
    
    600
    
    
    
    960Accrued expenses
    
    
    9,449
    
    
    
    9,550Deferred revenue
    
    
    8,409
    
    
    
    7,300Total current liabilities
    
    
    18,508
    
    
    
    17,865Deferred revenue
    
    
    17,722
    
    
    
    14,666Deferred rent
    
    
    3,128
    
    
    
    3,252Contingent purchase price
    
    
    6,000
    
    
    
    8,155Long-term debt obligations, net of current portion
    
    
    14
    
    
    
    27Total liabilities
    
    
    45,372
    
    
    
    43,965Commitments and contingencies (Note 5)Stockholders equity:Preferred stock, $0.01 par value; authorized
5,000,000 shares at June 30, 2007 and December
31, 2006, none outstanding
    
    
    
    
    
    
    Common stock, $0.01 par value; authorized
100,000,000 shares at June 30, 2007 and December
31, 2006; issued and outstanding 38,828,471 and
38,525,036 shares at June 30, 2007 and December
31, 2006, respectively
    
    
    388
    
    
    
    385Additional paid  in capital
    
    
    233,997
    
    
    
    232,215Accumulated deficit
    
    
    (204,501
    )
    
    
    (194,490
    )Accumulated other comprehensive income
    
    
    231
    
    
    
    207Total stockholders equity
    
    
    30,115
    
    
    
    38,317Total liabilities and stockholders equity
    
    $
    75,487
    
    
    $
    82,282
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ViaCell, Inc. and Subsidiaries
 
 Condensed Consolidated Statements of Operations
 (amounts in thousands, except per share data)
 (unaudited)
 Three Months Ended June 30,
    
    
    Six Months Ended June 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Processing and storage revenues
    
    $
    15,729
    
    
    $
    13,362
    
    
    $
    30,092
    
    
    $
    25,299Grant revenues
    
    
    
    
    
    
    177
    
    
    
    95
    
    
    
    320Total revenues
    
    
    15,729
    
    
    
    13,539
    
    
    
    30,187
    
    
    
    25,619Operating expenses:Cost of processing and storage revenues
    
    
    2,623
    
    
    
    2,536
    
    
    
    5,263
    
    
    
    4,864Research and development
    
    
    2,710
    
    
    
    3,660
    
    
    
    5,988
    
    
    
    7,126Sales and marketing
    
    
    11,908
    
    
    
    9,995
    
    
    
    23,029
    
    
    
    17,916General and administrative
    
    
    4,316
    
    
    
    5,013
    
    
    
    9,116
    
    
    
    9,650In-process research and development
    
    
    (2,155
    )
    
    
    
    
    
    
    (2,155
    )
    
    
    Restructuring
    
    
    267
    
    
    
    
    
    
    
    267
    
    
    
    (180
    )Total operating expenses
    
    
    19,669
    
    
    
    21,204
    
    
    
    41,508
    
    
    
    39,376Loss from operations
    
    
    (3,940
    )
    
    
    (7,665
    )
    
    
    (11,321
    )
    
    
    (13,757
    )Interest income (expense):Interest income
    
    
    613
    
    
    
    803
    
    
    
    1,312
    
    
    
    1,527Interest expense
    
    
    
    
    
    
    (17
    )
    
    
    (2
    )
    
    
    (43
    )Total interest income, net
    
    
    613
    
    
    
    786
    
    
    
    1,310
    
    
    
    1,484Loss from operations before cumulative effect of
change in accounting principle
    
    
    (3,327
    )
    
    
    (6,879
    )
    
    
    (10,011
    )
    
    
    (12,273
    )Cumulative effect of change in accounting principle
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    283Net loss
    
    $
    (3,327
    )
    
    $
    (6,879
    )
    
    $
    (10,011
    )
    
    $
    (11,990
    )Net loss per share:Basic and diluted net loss per common share
before cumulative
effect of change in accounting principle
    
    $
    (0.09
    )
    
    $
    (0.18
    )
    
    $
    (0.26
    )
    
    $
    (0.32
    )Cumulative effect of change in accounting principle
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.01Basic and diluted net loss per common share
    
    $
    (0.09
    )
    
    $
    (0.18
    )
    
    $
    (0.26
    )
    
    $
    (0.31
    )Weighted average shares used in basic and diluted
net loss per share computation
    
    
    38,784
    
    
    
    38,367
    
    
    
    38,725
    
    
    
    38,329
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ViaCell, Inc. and Subsidiaries
 
 Condensed Consolidated Statements of Comprehensive Loss
 (amounts in thousands)
 (unaudited)
 Three Months Ended June 30,
    
    
    Six Months Ended June 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Net loss
    
    $
    (3,327
    )
    
    $
    (6,879
    )
    
    $
    (10,011
    )
    
    $
    (11,990
    )Foreign currency translation adjustment
    
    
    13
    
    
    
    2
    
    
    
    24
    
    
    
    11Comprehensive loss
    
    $
    (3,314
    )
    
    $
    (6,877
    )
    
    $
    (9,987
    )
    
    $
    (11,979
    )
  6




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ViaCell, Inc. and Subsidiaries
 
 Condensed Consolidated Statements of Cash Flows
 (amounts in thousands)
 (unaudited)
 Six Months Ended June 30,2007
    
    
    2006Cash flows from operating activities:Net loss
    
    $
    (10,011
    )
    
    $
    (11,990
    )Adjustments to reconcile net loss to net cash used in operating activities:Depreciation and amortization
    
    
    1,137
    
    
    
    1,130Non-cash disposal of property and equipment
    
    
    244
    
    
    
    Cumulative effect of change in accounting principle
    
    
    
    
    
    
    (283
    )Stock-based compensation
    
    
    1,235
    
    
    
    1,531Warrant expense
    
    
    20
    
    
    
    Non-cash credit to in-process research and development
    
    
    (2,155
    )
    
    
    Reserve for bad debt
    
    
    582
    
    
    
    777Tenant improvement allowance
    
    
    
    
    
    
    60Other
    
    
    
    
    
    
    4Changes in assets and liabilities:Accounts receivable
    
    
    (1,391
    )
    
    
    1,093Prepaid expenses and other current assets
    
    
    (256
    )
    
    
    (733
    )Accounts payable
    
    
    (361
    )
    
    
    507Accrued expenses
    
    
    (117
    )
    
    
    3,007Deferred revenue
    
    
    4,165
    
    
    
    3,094Deferred rent
    
    
    (111
    )
    
    
    (263
    )Net cash used in operating activities
    
    
    (7,019
    )
    
    
    (2,066
    )Cash flows from investing activities:Purchases of property and equipment
    
    
    (807
    )
    
    
    (1,204
    )Proceeds from maturities of investments
    
    
    33,615
    
    
    
    20,922Purchase of investments
    
    
    (33,929
    )
    
    
    (20,276
    )Net cash used in investing activities
    
    
    (1,121
    )
    
    
    (558
    )Cash flows from financing activities:Proceeds from exercise of stock options
    
    
    531
    
    
    
    49Proceeds from refund of security deposit
    
    
    
    
    
    
    218Repayments on credit facilities
    
    
    
    
    
    
    (881
    )Payments on capital lease principal
    
    
    (18
    )
    
    
    (36
    )Net cash provided by (used in) financing activities
    
    
    513
    
    
    
    (650
    )Effect of change in exchange rates on cash
    
    
    27
    
    
    
    68Net decrease in cash and cash equivalents
    
    
    (7,600
    )
    
    
    (3,206
    )Cash and cash equivalents, beginning of period
    
    
    18,039
    
    
    
    33,138Cash and cash equivalents, end of period
    
    $
    10,439
    
    
    $
    29,932
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ViaCell, Inc. and Subsidiaries
 
 Notes to Unaudited Condensed Consolidated Financial Statements
 1. Organization and Nature of Business
 sm
  2. Summary of Significant Accounting Policies
 Basis of Presentation
  Use of Estimates
  Stock-Based Compensation
  8




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Net Loss Per Common Share
   Three Months Ended June 30,
    
    
    Six Months Ended June 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Basic and diluted net loss per shareNet loss
    
    $
    (3,327
    )
    
    $
    (6,879
    )
    
    $
    (10,011
    )
    
    $
    (11,990
    )Weighted average number of common
shares outstanding
    
    
    38,784
    
    
    
    38,367
    
    
    
    38,725
    
    
    
    38,329Basic and diluted net loss per share
    
    $
    (0.09
    )
    
    $
    (0.18
    )
    
    $
    (0.26
    )
    
    $
    (0.31
    )
  Six Months
    
    Six MonthsEnded
    
    EndedJune 30,
    
    June 30,2007
    
    2006Stock Options
    
    
    3,998,502
    
    
    
    3,958,946Warrants
    
    
    1,328,055
    
    
    
    1,837,291
 In-Process Research and Development Expense
  9




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##### Table of Contents



Recent
Accounting Pronouncements
   3. Accrued Expenses
  June 30,
    
    
    December 31,2007
    
    
    2006Payroll and payroll-related
    
    $
    1,926
    
    
    $
    1,904Management incentive
    
    
    635
    
    
    
    1,047Professional fees
    
    
    2,131
    
    
    
    1,829Accrued marketing
    
    
    2,240
    
    
    
    2,079Deferred rent, current
    
    
    357
    
    
    
    345Accrued taxes
    
    
    529
    
    
    
    459Other
    
    
    1,631
    
    
    
    1,887Accrued expenses
    
    $
    9,449
    
    
    $
    9,550
 4. Income Taxes
     10




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5. Commitments and Contingencies
 Agreements
  11




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Litigation
  12




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ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
  Overview
   Revenues
   15




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Operating Expenses
    16




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Results of Operations
 Three and Six Months Ended June 30, 2007 and 2006 (table amounts in thousands)
 Three Months Ended June 30,
    
    
    
    
    
    
    Six Months Ended June 30,2007
    
    
    2006
    
    
    Change
    
    
    2007
    
    
    2006
    
    
    ChangeProcessing revenues
    
    $
    12,389
    
    
    $
    10,822
    
    
    
    14
    %
    
    $
    23,615
    
    
    $
    20,433
    
    
    
    16
    %Storage revenues
    
    
    3,340
    
    
    
    2,540
    
    
    
    31
    %
    
    
    6,477
    
    
    
    4,866
    
    
    
    33
    %Total processing and
storage revenues
    
    
    15,729
    
    
    
    13,362
    
    
    
    18
    %
    
    
    30,092
    
    
    
    25,299
    
    
    
    19
    %Grant revenues
    
    
    
    
    
    
    177
    
    
    
    (100
    )%
    
    
    95
    
    
    
    320
    
    
    
    (70
    )%Total revenues
    
    $
    15,729
    
    
    $
    13,539
    
    
    
    16
    %
    
    $
    30,187
    
    
    $
    25,619
    
    
    
    18
    %
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Three Months Ended June 30,
    
    
    
    
    
    Six Months Ended June 30,2007
    
    2006
    
    Change
    
    2007
    
    2006
    
    ChangeCost of
processing and
storage revenues
    
    $
    2,623
    
    
    $
    2,536
    
    
    
    3
    %
    
    $
    5,263
    
    
    $
    4,864
    
    
    
    8
    %
  Three Months Ended June 30,
    
    
    
    
    
    Six Months Ended June 30,2007
    
    2006
    
    Change
    
    2007
    
    2006
    
    ChangeResearch and development
    
    $
    2,710
    
    
    $
    3,660
    
    
    
    (26
    )%
    
    $
    5,988
    
    
    $
    7,126
    
    
    
    (16
    )%
  Three Months Ended June 30,
    
    
    
    
    
    Six Months Ended June 30,2007
    
    2006
    
    Change
    
    2007
    
    2006
    
    ChangeSales and marketing
    
    $
    11,908
    
    
    $
    9,995
    
    
    
    19
    %
    
    $
    23,029
    
    
    $
    17,916
    
    
    
    29
    %
  18




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Three Months Ended June 30,
    
    
    
    
    
    Six Months Ended June 30,2007
    
    2006
    
    Change
    
    2007
    
    2006
    
    ChangeGeneral and administrative
    
    $
    4,316
    
    
    $
    5,013
    
    
    
    (14
    )%
    
    $
    9,116
    
    
    $
    9,650
    
    
    
    (6
    )%
  Three Months Ended June 30,
    
    
    
    
    
    Six Months Ended June 30,2007
    
    2006
    
    Change
    
    2007
    
    2006
    
    ChangeIn-process
research &
development
    
    $
    (2,155
    )
    
    $
    
    
    
    
    (100
    )%
    
    $
    (2,155
    )
    
    $
    
    
    
    
    (100
    )%
  Three Months Ended June 30,
    
    
    
    
    
    Six Months Ended June 30,2007
    
    2006
    
    Change
    
    2007
    
    2006
    
    ChangeRestructuring
    
    $
    267
    
    
    $
    
    
    
    
    100
    %
    
    $
    267
    
    
    $
    (180
    )
    
    
    248
    %
   19




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Three Months Ended June 30,
    
    
    
    
    
    
    Six Months Ended June 30,2007
    
    
    2006
    
    
    Change
    
    
    2007
    
    
    2006
    
    
    ChangeInterest income
    
    $
    613
    
    
    $
    803
    
    
    
    (24
    )%
    
    $
    1,312
    
    
    $
    1,527
    
    
    
    (14
    )%Interest expense
    
    
    
    
    
    
    (17
    )
    
    
    100
    %
    
    
    (2
    )
    
    
    (43
    )
    
    
    95
    %Total interest income, net
    
    $
    613
    
    
    $
    786
    
    
    
    (22
    )%
    
    $
    1,310
    
    
    $
    1,484
    
    
    
    (12
    )%
  Liquidity and Capital Resources
   Six Months
    
    Six MonthsEnded June 30,
    
    Ended June 30,2007
    
    2006
    
    $ ChangeNet cash used in operating activities
    
    $
    (7.0
    )
    
    $
    (2.1
    )
    
    $
    (4.9
    )Net cash used in investing activities
    
    
    (1.1
    )
    
    
    (0.6
    )
    
    
    (0.5
    )Net cash provided by (used in) financing
activities
    
    
    0.5
    
    
    
    (0.7
    )
    
    
    1.2Cash and cash equivalents, end of period
    
    
    10.4
    
    
    
    29.9
    
    
    
    (19.5
    )
 Operating Activities
  Investing Activities
  20




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Financing Activities
    Other Arrangements
 Mothers Work Data and Marketing Services
  21




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Miltenyi
   Legal Proceedings
   22




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Critical Accounting Estimates
   
    
    revenue recognition;
    
    accounting for stock-based compensation;
    
    accounting for accounts receivable;
    
    accounting for research and development expenses; and
    
    accounting for the Mothers Work indemnification agreement.
 Revenue recognition
 Accounting for stock-based compensation.
 24




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Accounting
for accounts receivable.
 Accounting for research and development expenses.
 Accounting for the Mothers Work indemnification agreement
 25




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Recent
Accounting Pronouncements
   26




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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 Investment Risk
  Foreign Exchange Risk
  Interest Rate Risk
  
 ITEM 4. CONTROLS AND PROCEDURES
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PART II  OTHER INFORMATION
 
 ITEM 1. LEGAL PROCEEDINGS
  
 ITEM 1A. RISK FACTORS
  We may not achieve our goal of becoming cash flow positive, and may never become profitable.
  
    
    our ability to increase sales of our ViaCord service offering
particularly in the face of significant competition;
    
    continued acceptance in the marketplace for family cord blood banking
and the overall growth of the family cord blood banking category;
    
    the impact of any unexpected issues or failures related to the
collection, processing or storage of umbilical cord blood by us or
others in the industry;
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
    
    the impact of any potential adverse outcome in the patent infringement
lawsuits brought against us by PharmaStem, including legal expenses,
and the material impact on our business if PharmaStem were able to
obtain an injunction;
    
    the level of our expenses, including as a result of difficulties or
delays related to our research and development programs, and any
unexpected expenses; and
    
    the overall net impact on revenues and expenses of new licensing
deals, collaborations or other strategic efforts.
  We may not be able to sustain our current level of revenues or our recent growth rates.
  If we do not prevail in the PharmaStem litigation, we may be prevented from selling our ViaCord
service offering or may have to incur significant expenses.
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A third party may again seek to challenge the arbitrators decision related to our agreement with
Mothers Work.
  If we are not able to successfully develop and commercialize new products, our future prospects may
be limited.
     31




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We may not be able to successfully develop our ViaCyte oocyte cryopreservation product candidate.
 in vitro
 We may not be able to raise additional funds necessary to fund our operations.
   
    
    the level of cash flows from sales of our ViaCord service offering;
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
    
    the costs of increasing or expanding our ViaCord sales and marketing efforts;
    
    the scope and results of our research and development programs;
    
    the clinical pathway for each of our product candidates, including the
number, size, scope and cost of clinical trials required to establish safety
and efficacy;
    
    the results of litigation and other disputes;
    
    the costs associated with expanding our portfolio of product candidates
through licensing, collaborations or acquisitions;
    
    the costs of research and development work focused on developing clinical
and commercial scale processes for manufacturing cellular products and, if
we advance our products, the costs of building and operating our
manufacturing facilities, both to support our clinical activities and also
in anticipation of growing our commercialization activities;
    
    funds spent in connection with acquisitions of related technologies or
businesses, including contingent payments that may be made in connection
with our acquisition of Kourion Therapeutics;
    
    the costs of maintaining, expanding and protecting our intellectual property
portfolio, including litigation costs and liabilities; and
    
    our ability to establish and maintain collaborative arrangements and obtain
milestones, royalties and other payments from collaborators.
  We depend on patents and other proprietary rights that may fail to protect our business.
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Third parties may own or control patents or patent applications that are infringed by our
technologies or product candidates.
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Our success will depend in part on establishing and maintaining effective strategic partnerships
and collaborations.
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Our cell preservation activities are subject to regulations that may impose significant costs and
restrictions on us.
 Cord blood preservation.
  Oocyte
cryopreservation.
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We have only limited experience manufacturing cell therapy product candidates, and we may not be
able to manufacture our product candidates in quantities sufficient for clinical studies or for
commercial scale.
  We are dependent upon third parties to supply us with certain components of our cell therapy
product candidates, the loss of which may delay development of our product candidates.
   Our inability to have ViaCyte consistently manufactured to specifications or the loss of our
contract manufacturer may delay development of our ViaCyte product candidate.
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We are dependent on our existing suppliers to successfully commercialize our ViaCord service
offering. The loss of such suppliers may inhibit our ability to commercialize ViaCord.
  If our cord blood processing and storage facility or our clinical manufacturing facilities are
damaged or destroyed, our business, programs and prospects could be negatively affected.
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Our competitors may have greater resources or capabilities or better technologies than we have, or
may succeed in developing better products or develop products more quickly than we do, and we may
not be successful in competing with them.
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Due to the nature of our cell preservation activities, harm to our reputation could have a
significant negative impact on our financial condition. Damage to or loss of our customers
property held in our custody could potentially result in significant legal liability.
   The manufacture and sale of products may expose us to product liability claims for which we could
have substantial liability.
  Our success is dependent upon recruiting and retaining qualified management and other personnel.
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We may face difficulties in managing and maintaining the growth of our business.
    Our business could be disrupted or harmed and we could be subject to liability if we are unable to
operate our information systems effectively, successfully implement new technologies and protect
the confidentiality of our or our customers data.
  If we acquire other businesses or technologies the transactions may be dilutive and we may be
unable to integrate them successfully with our business, our financial performance could suffer.
  The successful commercialization of products may depend on patients and physicians obtaining
reimbursement for products from third party payers.
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We face potential liability related to the privacy of health information we obtain from research
collaborators or from providers who enroll patients and collect cord blood or human oocytes.
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Ethical and other concerns surrounding the use of stem cell therapy may negatively affect
regulatory approval or public perception of our products and product candidates, thereby reducing
demand for our products and product candidates.
  Our business involves the use of hazardous materials that could expose us to environmental and
other liability.
  Volatility of Our Stock Price.
  
    
    material public announcements;
    
    the data, positive or negative, generated from the development of our product candidates;
    
    setbacks or delays in any of our research or development programs;
    
    the outcome of material litigation;
    
    the financial results achieved by our cord blood preservation business;
    
    the impact of competition;
    
    unusual or unexpectedly high expenses;
    
    developments related to patents and other proprietary rights;
    
    market trends affecting stock prices in our industry; and
    
    economic or other external factors.
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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
 Sales of Unregistered Securities
  Use of Proceeds from Registered Securities
     Issuer Purchase of Equity Securities
  
 ITEM 3. DEFAULTS UPON SENIOR SECURITIES
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ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  (a)
    
    A proposal to elect Marc D. Beer, Vaughn M. Kailian and James Sigler as directors to
serve for a three year term ending in 2010 and until their successors are duly elected and
qualified or their earlier resignation or removal was approved with the following vote:
 Director
    
    For
    
    WithheldMarc D. Beer
    
    
    23,280,559
    
    
    
    171,871Vaughn M. Kailian
    
    
    23,285,271
    
    
    
    167,159James Sigler
    
    
    23,285,571
    
    
    
    166,859
 (b)
    
    A proposal to ratify the selection of PricewaterhouseCoopers LLP as our independent
registered public accounting firm for the fiscal year ending December 31, 2007 was approved
with 23,333,994 votes for, 89,335 votes against, and 29,101 abstentions. There were no
broker non-votes for this proposal.
 
 ITEM 5. OTHER INFORMATION
 (a)
    
    None.(b)
    
    None.
 
 ITEM 6. EXHIBITS
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SIGNATURES
  VIACELL, INC.August 9, 2007/s/ Marc D. BeerMarc D. BeerChief Executive Officer(Principal Executive Officer)August 9, 2007/s/ John F. TheroJohn F. TheroChief Financial Officer(Principal Financial Officer)
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EXHIBIT INDEX
 No.
    
    Item10.1
    (1)
    
    Letter agreement dated June 16, 2007 between ViaCell and John F. Thero.*31.1
    
    
    Certification of the Chief Executive Officer pursuant to Section 302 of
the Sarbanes-Oxley Act of 200231.2
    
    
    Certification of the Chief Financial Officer pursuant to Section 302 of
the Sarbanes-Oxley Act of 200232.1
    
    
    Certification of the Chief Executive Officer pursuant to Section 906 of
the Sarbanes-Oxley Act of 200232.1
    
    
    Certification of the Chief Financial Officer pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002
 
 (1)
    
    Incorporated by reference to the Companys current report on Form 8-K (No. 000-51110)
filed with the SEC on July 2, 2007.*
    
    Indicates a management contract or compensatory plan 47