SAN DIEGO, Nov. 13, 2018 /PRNewswire/ -- Biocept, Inc.
(NASDAQ: BIOC), a leading commercial provider of liquid biopsy
tests designed to provide physicians with clinically actionable
information to improve the outcomes of cancer patients, reports
financial results for the three and nine months ended September 30, 2018, and provides an update on its
business progress.
"Progress continues on multiple fronts to support our future
growth," said Michael Nall,
President and CEO of Biocept. "We have restructured our commercial
organization with the recent hiring of a team of industry veterans
who have a proven track record of success in the diagnostics
market. Under the leadership of our new Chief Commercial Officer,
Edwin Hendrick, we have developed
new marketing strategies with a focused approach on specific market
segments. We are also launching new programs to further engage our
current customers as we continue to seek to broaden adoption of our
Target Selector™ platforms.
"As an update on our collaboration with Thermo Fisher
Scientific, we expect to complete validation of the molecular
oncology assay panel before the end of 2018, and we anticipate
being in position for commercial launch in 2019. At that time,
Biocept will be the only liquid biopsy company offering both
individual cancer biomarker tests along with the option of a larger
oncology assay panel," he added.
Review of Third Quarter and Recent Accomplishments
Collaborations
- Entered into an agreement with Highmark Heath, part of the
Allegheny Health Network, to evaluate the clinical utility and cost
effectiveness of Target Selector™ in patients diagnosed with
non-small cell lung cancer (NSCLC). More than 10% of the 100
patients expected to participate have been enrolled in the
program.
- Entered into a partnership with the Moores Cancer Center at UC
San Diego Health to conduct two clinical studies in patients with a
variety of solid tumors. These studies will use Target Selector™ to
detect circulating tumor cells (CTCs) and circulating tumor DNA
(ctDNA), and compare results with findings from computed tomography
(CT) or positron emission tomography (PET) scans. More than 10% of
patients have been enrolled in these studies.
- Entered into a provider agreement with Alliance Global FZ, LLC
to market and distribute Target Selector™ liquid biopsy tests in
the United Arab Emirates and
select countries in the Middle
East, North and Sub-Saharan Africa and Southeast Asia. All diagnostic testing
services will be performed in Biocept's CLIA-certified laboratory
in San Diego with Alliance Global
responsible for sales, marketing and distribution.
Clinical Data Presentations
- Presented two posters at the International Association for the
Study of Lung Cancer's 19th World Conference on Lung
Cancer featuring clinical data sets highlighting the ability of our
Target Selector™ technology platforms to detect and monitor
actionable biomarkers in patients diagnosed with NSCLC. The first
study was conducted with a large academic medical center and
evaluated CTC count in blood in order to demonstrate response to
treatment. The second poster, presented with a pharmaceutical
partner, demonstrated the utility of CTCs and ctDNA in blood and
cerebrospinal fluid (CSF).
Intellectual Property
- Obtained patent in Japan for
Switch-Blocker technology that is core to Target Selector™ assays
for analysis using real-time PCR, Sanger sequencing and next-generation
sequencing.
- Awarded a Canadian patent covering the use of microchannels for
the capture and detection of any target of interest, including
proteins and nucleic acids, as well as the capture of cancer or
other cells that can be used for molecular analysis in blood and
other biological fluids.
- Granted patent in seven European countries for our Target
Selector™ ctDNA assays featuring our Switch-Blocker
technology.
Corporate
- Appointed Edwin C. Hendrick as
Senior Vice President, Chief Commercial Officer. Mr. Hendrick
brings more than 25 years of sales and commercial leadership
experience in the healthcare industry including senior level
commercial and operational positions in the clinical diagnostics
field.
- Strengthened commercial team by naming Scott Nicholson as Vice President of Sales – US,
and Cory Dunn as Vice President of
Marketing. Mr. Nicholson has 24 years of experience in the medical
laboratory industry with a focus in oncology for the physician and
hospital markets, and Ms. Dunn has over 15 years of commercial
marketing experience in the life sciences industry, specializing in
diagnostic testing services for oncology.
- Entered into a securities purchase agreement with accredited
institutional investors pursuant to which we sold approximately
$2.5 million in gross proceeds of
common stock and warrants.
- Completed a shareholder rights offering raising gross proceeds
of approximately $11.6 million.
Third Quarter Financial Results
Revenues for the third quarter of 2018 were $762,000, compared with $1.1 million for the third quarter of 2017.
During the first quarter of 2017, the Company converted from
cash-based revenue recognition for its commercial revenues to
accrual-based revenue recognition. Of the $1.1 million of revenues recognized during the
third quarter of 2017, $0.9 million
were related to revenues recognized on an accrual basis, while
$102,000 were related to revenues
recognized upon the receipt of cash. This compares with the third
quarter of 2018, when $762,000 of
revenues were recognized on an accrual basis and no revenues were
recognized upon the receipt of cash. For the third quarter of 2018,
revenues included $698,000 in
commercial test revenues, and $63,000
in development services test revenues.
Biocept reported 964 total samples in the third quarter of 2018,
compared with 1,343 total samples in the third quarter of 2017.
Total samples include billable samples and samples from research
activities, assay validations and other non-billable sources. The
Company accessioned 878 billable samples in the third quarter of
2018, compared with 1,203 billable samples for the third quarter of
2017.
Cost of revenues for the third quarter of 2018 of $2.5 million was unchanged from the prior year
period. Cost of revenues in the 2018 period was impacted by an
increase in expenses associated with validating the Thermo Fisher
molecular oncology assay panel, and an increase in costs associated
with calibrations and CLIA validations to improve upon existing
equipment specifications and testing protocols. In addition, we
continue to maintain laboratory capacity to accommodate higher
volumes as we work to improve our growth trends.
Research and development (R&D) expenses for the third
quarter of 2018 were $1.1 million,
compared with $857,000 for the third
quarter of 2017, with the increase due primarily to the higher
proportion of allocated laboratory costs associated with increased
research and development activities and cost of research studies in
collaboration with academic and healthcare institutions.
General and administrative (G&A) expenses for the third
quarters of 2018 and 2017 were unchanged at $1.8 million.
Sales and marketing expenses for the third quarter of 2018 were
$1.4 million, compared with
$1.7 million for the third quarter of
2017, a decrease of $272,000, or 16%,
primarily driven by a reduction in headcount-related expenses and
sales commissions due to lower sales volume.
The net loss for the third quarter of 2018 was $6.0 million, or $2.42 per share on 2.8 million weighted-average
shares outstanding. This compares with a net loss for the third
quarter of 2017 of $5.8 million, or
$5.90 per share on 987,000
weighted-average shares outstanding.
Nine Month Financial Results
Revenues for the first nine months of 2018 were $2.4 million, compared with $4.1 million for the first nine months of 2017,
and included $2.2 million in
commercial test revenues, $160,000 in
development service test revenues and $9,000 in revenues for CEE-Sure blood collection
tubes. As a result of the change to accrual-based revenue
recognition in the first quarter of 2017, the Company recognized
total nonrecurring revenue of $839,000 during the first nine months of 2017 for
cases delivered on or prior to December 31,
2016.
Biocept reported 2,958 billable samples during the first nine
months of 2018, compared with 3,535 billable samples for the first
nine months of 2017. Total samples, which also include samples from
research activities, assay validations and other non-billable
sources, were 3,209 for the first nine months of 2018, compared
with 3,994 total samples for the first nine months of
2017.
Cost of revenues for the first nine months of 2018 was
$7.6 million, compared with
$7.0 million for the first nine
months of 2017, an increase of $631,000 or 9%, driven primarily by an increase
in the cost of materials due to assay validations, an increase in
depreciation expense related to laboratory and computer equipment,
software amortization, and allocated facility charges as we
invested in upgrading our laboratory equipment and information
system and facility maintenance.
R&D expenses for the first nine months of 2018 were
$3.2 million, compared with
$2.5 million for the prior-year
period, an increase of $724,000 or
29%, with the increase due primarily to higher lab allocation costs
and headcount-related expenses as we focused on the development and
deployment of next generation sequencing, support and
implementation of data-intensive laboratory processes, and new
product validations. In addition, R&D expenses also saw an
increase related to cost of research studies in collaboration with
academic and healthcare institutions.
G&A expenses for the first nine months of 2018 were
$5.4 million, compared with
$5.5 million for the first nine
months of 2017, a decrease of $98,000
or 2%, with the decrease driven primarily by a decrease in
headcount-related expenses.
Sales and marketing expenses for the first nine months of 2018
were $4.5 million, versus
$4.7 million for the first nine
months of 2017, a decrease of $227,000 or 5%, with the decrease driven
primarily by a decrease in sales commissions due to lower sales
volume, decrease in travel and related expenses, and other
personnel related costs.
In the third quarter of 2018, we made a payment to Oxford
Finance of approximately $500,000,
which included our final debt installment and other fees to
extinguish our long-term debt facility.
The net loss for the first nine months of 2018 was $18.6 million, or $8.26 per share on 2.3 million weighted-average
shares outstanding. This compares with a net loss for the first
nine months of 2017 of $15.9 million,
or $18.53 per share on 861,000
weighted-average shares outstanding.
Cash and cash equivalents as of September
30, 2018 were $9.0 million,
compared with $2.1 million as of
December 31, 2017. The Company raised
approximately $12.5 million in
aggregate net proceeds from a shareholder rights offering and a
financing with certain institutional investors, both of which
closed in the third quarter of 2018.
Biocept implemented a cost-reduction program to reduce expenses
by an estimated $1.0 million to
$1.5 million annually, in addition to
the more than $2 million reduction in
annual cash spend, resulting from the payoff of the Company's
long-term debt obligation in July
2018.
Conference Call and Webcast
Biocept will hold a
conference call today at 4:30 p.m. Eastern
time to discuss these results and answer questions. The
conference call can be accessed by dialing (855) 656-0927 for
domestic callers, (855) 669-9657 for Canadian callers or (412)
902-4109 for other international callers. A live webcast of the
conference call will be available on the investor relations page of
the company's website at http://ir.biocept.com/events.cfm. A replay
of the webcast will be available for 90 days.
A replay of the call will be available for 48 hours following
the conclusion of the call and can be accessed by dialing (877)
344-7529 for domestic callers, (855) 669-9658 for Canadian callers
or (412) 317-0088 for other international callers. Please use event
passcode 10125618.
About Biocept
Biocept, Inc. is a molecular diagnostics
company with commercialized assays for lung, breast, gastric,
colorectal and prostate cancers, and melanoma. The Company
leverages its proprietary liquid biopsy technology to provide
physicians with clinically actionable information for treating and
monitoring patients diagnosed with cancer. Biocept's patented
Target Selector™ liquid biopsy technology platform captures and
analyzes tumor-associated molecular markers in both circulating
tumor cells (CTCs) and in circulating tumor DNA (ctDNA). With
thousands of tests performed, the platform has demonstrated the
ability to identify cancer mutations and alterations to inform
physicians about a patient's disease and therapeutic options. For
additional information, please visit www.biocept.com.
Forward-Looking Statements Disclaimer Statement
This
news release contains forward-looking statements that are based
upon current expectations or beliefs, as well as a number of
assumptions about future events. Although we believe that the
expectations reflected in the forward-looking statements and the
assumptions upon which they are based are reasonable, we can give
no assurance that such expectations and assumptions will prove to
be correct. Forward-looking statements are generally identifiable
by the use of words like "may," "will," "should," "could,"
"expect," "anticipate," "estimate," "believe," "intend" or
"project," or the negative of these words or other variations on
these words or comparable terminology. To the extent that
statements in this news release are not strictly historical,
including, without limitation, statements as to our ability to
provide physicians with clinically actionable information to
improve the outcomes of cancer patients, our ability to grow our
business and drive adoption of our products, the success of our
collaboration with Thermo Fisher Scientific and our ability to
validate and commercially launch products as a result thereof, the
benefits of our cost-reduction program, and our ability to increase
physician adoption of our liquid biopsy platform, such statements
are forward-looking, and are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
The reader is cautioned not to put undue reliance on these
forward-looking statements, as these statements are subject to
numerous risk factors as set forth in our Securities and Exchange
Commission (SEC) filings. The effects of such risks and
uncertainties could cause actual results to differ materially from
the forward-looking statements contained in this news release. We
do not plan to update any such forward-looking statements and
expressly disclaim any duty to update the information contained in
this press release except as required by law. Readers are advised
to review our filings with the SEC at www.sec.gov.
Investor
Contact:
|
|
Media
Contact:
|
LHA Investor
Relations
|
|
Trevelino/Keller
|
Jody Cain
|
|
Colleen
Murphy
|
Jcain@lhai.com
|
|
cmurphy@trevelinokeller.com
|
(310)
691-7100
|
|
(404) 214-0722, Ext.
109
|
BIOCEPT,
INC.
|
CONDENSED BALANCE
SHEETS
|
|
|
December 31,
|
|
September
30,
|
|
2017
|
|
2018
|
|
|
|
|
(unaudited)
|
ASSETS
|
|
|
|
|
|
Cash
|
$
|
2,146,611
|
|
$
|
8,956,200
|
Accounts
receivable, net
|
|
1,193,426
|
|
|
1,476,454
|
Inventories,
net
|
|
498,702
|
|
|
581,498
|
Prepaid expenses
and other current assets
|
|
416,600
|
|
|
636,746
|
TOTAL CURRENT
ASSETS
|
|
4,255,339
|
|
|
11,650,898
|
FIXED ASSETS,
NET
|
|
3,123,567
|
|
|
2,900,994
|
TOTAL
ASSETS
|
$
|
7,378,906
|
|
$
|
14,551,892
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
CURRENT
LIABILITIES, NET
|
$
|
4,661,345
|
|
$
|
4,439,087
|
NON-CURRENT
LIABILITIES,
NET
|
|
1,421,527
|
|
|
1,174,397
|
TOTAL
LIABILITIES
|
|
6,082,872
|
|
|
5,613,484
|
SHAREHOLDERS'
EQUITY
|
|
1,296,034
|
|
|
8,938,408
|
TOTAL LIABILITIES
AND SHAREHOLDERS' EQUITY
|
$
|
7,378,906
|
|
$
|
14,551,892
|
BIOCEPT,
INC.
|
CONDENSED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
|
|
|
For the three
months ended September 30,
|
|
For the nine
months ended September 30,
|
|
(Unaudited)
|
|
(Unaudited)
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
Net
revenues
|
$
1,111,411
|
|
$
761,591
|
|
$
4,073,437
|
|
$
2,390,772
|
Costs and
expenses:
|
|
|
|
|
|
|
|
Cost of
revenues
|
2,487,054
|
|
2,481,916
|
|
6,985,213
|
|
7,616,473
|
Research and
development expenses
|
856,698
|
|
1,089,746
|
|
2,455,947
|
|
3,179,612
|
General and
administrative expenses
|
1,834,771
|
|
1,793,720
|
|
5,539,432
|
|
5,441,354
|
Sales and marketing
expenses
|
1,675,852
|
|
1,404,192
|
|
4,701,030
|
|
4,473,908
|
Total costs and
expenses
|
6,854,375
|
|
6,769,574
|
|
19,681,622
|
|
20,711,347
|
Loss from
operations
|
(5,742,964)
|
|
(6,007,983)
|
|
(15,608,185)
|
|
(18,320,575)
|
Other income/
(expense):
|
|
|
|
|
|
|
|
Interest
expense
|
(88,269)
|
|
(63,764)
|
|
(385,172)
|
|
(230,677)
|
Other
income
|
12,804
|
|
23,963
|
|
51,216
|
|
(6,037)
|
Total other income/
(expense):
|
(75,465)
|
|
(39,801)
|
|
(333,956)
|
|
(236,714)
|
Loss before income
taxes
|
(5,818,429)
|
|
(6,047,784)
|
|
(15,942,141)
|
|
(18,557,289)
|
Income tax
expense
|
(2,877)
|
|
—
|
|
(5,023)
|
|
(739)
|
Net loss and
comprehensive loss
|
$(5,821,306)
|
|
$(6,047,784)
|
|
$(15,947,164)
|
|
$(18,558,028)
|
Deemed dividend
related to warrants down round provision
|
—
|
|
$
(636,370)
|
|
—
|
|
$
(636,370)
|
Net
loss attributable to common shareholders
|
$(5,821,306)
|
|
$(6,684,154)
|
|
$(15,947,164)
|
|
$(19,194,398)
|
Weighted-average
shares outstanding used in computing net loss per share
attributable to common shareholders:
|
|
|
|
|
|
|
|
Basic
|
986,865
|
|
2,767,440
|
|
860,539
|
|
2,322,749
|
Diluted
|
986,865
|
|
2,759,614
|
|
860,539
|
|
2,320,111
|
Net loss per common
share:
|
|
|
|
|
|
|
|
Basic
|
$
(5.90)
|
|
$
(2.42)
|
|
$
(18.53)
|
|
$
(8.26)
|
Diluted
|
$
(5.90)
|
|
$
(2.42)
|
|
$
(18.53)
|
|
$
(8.27)
|
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SOURCE Biocept, Inc.