Chembio Diagnostics, Inc. (Nasdaq: CEMI), a leading point-of-care
diagnostics company focused on infectious diseases, today reported
financial results for the quarter ended March 31, 2021. Chembio
achieved first quarter 2021 total revenue of $8.7 million and
product revenue of $4.0 million, representing growth of 27% and a
decline of 30%, respectively, compared to the prior year period.
Commercial and Product
Accomplishments
- Launched marketing programs with
national distribution partners in the U.S to promote and supply the
rapid DPP HIV-Syphilis test system across decentralized healthcare
markets
- Completed registrations in and
received initial purchase orders for shipment to multiple countries
in Africa and Southeast Asia for the World Health Organization
prequalified SURE CHECK HIV Self-Test
COVID-19 Testing Portfolio
Update
- Completed milestones resulting in
the recognition of $3.4 million of revenue in the first quarter as
part of the $12.7 million BARDA award for the development and
issuance of an Emergency Use Authorization (EUA) application for
the DPP Respiratory Panel and the development and receipt of 510(k)
clearance for the rapid, point-of-care DPP SARS-CoV-2 Antigen test
system
- Continued the close collaboration
with BARDA under the $628,000 award in pursuit of an EUA for the
DPP SARS-CoV-2 Antigen test system
- Received regulatory approval for
the DPP SARS-CoV-2 Antigen test system from Agência Nacional de
Vigilância Sanitária (ANVISA), Brazil’s health regulatory agency,
in collaboration with Bio-Manguinhos, a subsidiary of the Oswaldo
Cruz Foundation that is responsible for the development and
production of vaccines, diagnostics and biopharmaceuticals,
primarily to meet demands of Brazil’s national public health
system
- Initiated U.S. distribution of the
in-licensed rapid, point-of-care, EUA approved Status COVID-19/Flu
A&B test that is sourced from a third party
“In recent months we have advanced several
strategic initiatives focused on leveraging the capabilities of our
network of distributors and fully scaled U.S. salesforce across our
diversified product portfolio,” said Richard Eberly, Chembio’s
President and Chief Executive Officer. “Commercially, we are seeing
good momentum with our SURE CHECK HIV Self-Test via our
international channels and our DPP HIV-Syphilis system in the
United States.”
Mr. Eberly continued, “In addition, we are
seeing positive reaction from customers regarding the Status
COVID-19/Flu A&B test. These include both customer commitments
and planned product evaluations in anticipation of the return of
flu season in the late summer and early fall. Together with BARDA,
we remain actively engaged in pursuit of an EUA for the rapid,
point-of-care DPP SARS-CoV-2 Antigen System and DPP Respiratory
Panel, and are continuing our work towards 510(k) clearance for the
DPP SARS-CoV-2 Antigen System. As we look ahead, we remain
committed to delivering profitable growth by leveraging our growing
customer base and expanded commercial team while also focusing on
gross margin expansion through manufacturing automation and
operational excellence.”
First Quarter 2021 Financial
ResultsTotal revenue for the first quarter of 2021 was
$8.7 million, an increase of 27% compared to the prior year period.
Net product sales for the first quarter of 2021 were $4.0 million,
a decrease of 30% compared to the prior year period. Government
grant, license and royalty, and R&D revenue for the first
quarter of 2021 totaled $4.7 million, an increase of 311% compared
to the prior year period.
Gross product margin for the first quarter of
2021 was $0.5 million, compared to $1.3 million for the prior year
period. Gross product margin percentage for the first quarter of
2021 was 12%, compared to 24% for the prior year period. Gross
product margin in the first quarter of 2021 was impacted by
unfavorable geographic product mix and fixed manufacturing
overhead.
Research and development expenses increased by
$0.9 million, or 46%, in the first quarter of 2021 compared to the
prior year period. The increase in research and development expense
was primarily associate with work related to pursuing an EUA and
510(k) from the FDA for the DPP SARS-CoV-2 Antigen test system and
an EUA for the DPP Respiratory Panel. Selling, general and
administrative expenses increased by $1.9 million, or 46%, in the
first quarter of 2021 compared to the prior year period. The
increase in selling, general and administrative expenses was
primarily due to increased costs associated with professional
fees.
Net loss for the first quarter of 2021 was $4.5
million, or $0.22 per diluted share, compared to a net loss of $5.0
million, or $0.29 per diluted share, for the prior year
period.
Cash and cash equivalents as of March 31, 2021
totaled $14.4 million.
Conference CallChembio will
host a conference call today beginning at 4:30 pm ET to discuss its
financial results and recent business highlights. Investors
interested in listening to the call may do so by dialing
877-545-0320 from the United States or 973-528-0016 from outside
the United States and providing entry code 562459. To listen to a
live webcast of the call, please visit the Investor Relations
section of Chembio's website at www.chembio.com. Following the
call, a replay will be available on the Investor Relations section
of Chembio’s website. A telephone replay will be available until
4:30 pm ET on May 19, 2021 by dialing 877-481-4010 from the United
States or 919-882-2331 from outside the United States and using
passcode 40896.
Highlighted Product Features and
Clinical ApplicationsThe SURE CHECK HIV Self-Test uses the
world’s smallest blood sample required by any rapid HIV test and
provides results in 15 minutes. The unique design of the SURE CHECK
HIV Self-Test integrates the capillary device and buffer solution,
eliminating the need for separate collection devices and buffer
solution bottles required by other HIV self-tests. In 2016, the WHO
recommended HIV self-testing (HIVST) as a safe, accurate,
convenient, and confidential option for HIV testing, and that it is
a way to reach people who may not test otherwise, including people
from key populations, men and young people. Lay users can perform
HIVST reliably and accurately and achieve performance comparable to
that of trained health-care workers. In 2019, the WHO reported that
“thirty-two randomized controlled trials showed that, compared with
standard facility-based HIV testing, HIVST increases the uptake of
HIV testing.”
Chembio’s DPP HIV-Syphilis System is a
multiplex, single-use, 15-minute test, which is designed, in
combination with the Micro Reader analyzer, to simultaneously
detect antibodies to HIV types 1 and 2 and Treponema pallidum, the
bacteria that causes syphilis. The U.S. Centers for Disease Control
recently reported that from 2015 to 2019, primary and secondary
syphilis infections have risen 178% , and congenital syphilis
infections have risen 291%. Untreated syphilis in pregnant women
results in still birth or infant death in 40% of cases, and
patients with active infections are 2 to 5 times more likely to
contract HIV when exposed.
About the DPP Rapid Test
PlatformChembio’s proprietary DPP technology platform
provides high-quality, rapid diagnostic results in 15 to 20 minutes
using a small drop of blood from the fingertip or alternative
samples. Through advanced multiplexing, the DPP platform can detect
up to eight, distinct test results from a single patient sample,
delivering greater clinical value than other rapid tests. For
certain applications, Chembio’s easy-to-use, highly portable,
battery-operated DPP Micro Reader optical analyzer then reports
accurate results in approximately 15 seconds, making it well-suited
for decentralized testing where real-time results enable patients
to be clinically assessed while they are still on-site. Objective
results produced by the DPP Micro Reader reduce the possibility of
the types of human error that can be experienced in the visual
interpretations required by many rapid tests.
Chembio’s portfolio of DPP-based point-of-care
tests with FDA regulatory approvals include the DPP HIV-Syphilis
System (PMA approved), DPP HIV 1/2 Assay (PMA approved and CLIA
waived), DPP Zika IgM System (510(k)), and DPP Ebola Antigen System
(EUA). Additionally, DPP-based tests have received regulatory
approvals from the World Health Organization, CE-Mark, ANVISA, and
other global organizations, where they aid in the detection and
diagnosis of several other critical diseases and conditions.
All DPP tests are developed and manufactured in
the United States and are the subject of a range of domestic and
global patents and patents pending.
About Chembio
DiagnosticsChembio is a leading point-of-care diagnostics
company focused on detecting and diagnosing infectious diseases,
including COVID-19, sexually transmitted, respiratory and insect
vector diseases. Coupled with Chembio’s extensive scientific
expertise, its novel DPP technology offers broad market
applications beyond infectious disease. Chembio’s products are sold
globally, directly and through distributors, to hospitals and
clinics, physician offices, clinical laboratories, public health
organizations, government agencies, and consumers. Learn more at
www.chembio.com.
About the BARDA ProjectsChembio
will use the federal funds from the Department of Health and Human
Services; Office of the Assistant Secretary for Preparedness and
Response; Biomedical Advanced Research and Development Authority,
under Contract No. 75A50121P00012 and Contract No.
75A50120C00138.
Forward-Looking
StatementsCertain statements contained in the two
paragraphs following the bulleted items under “COVID-19 Testing
Portfolio Update” above are not historical facts and may be
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements include statements regarding the intent, belief or
current expectations with respect to the distribution and sale of
Chembio’s diagnostic tests, the availability, timing, functionality
and regulatory approval of Chembio’s COVID-19 diagnostic tests, and
Chembio’s ability to achieve profitability or growth. Such
statements, which are expectations only, reflect management's
current views, are based on certain assumptions, and involve risks
and uncertainties. Actual results, events or performance may differ
materially from forward-looking statements due to a number of
important factors, and will be dependent upon a variety of factors,
including, but not limited to, the following, any of which could be
exacerbated even further by the continuing COVID-19 outbreak in the
United States and globally: the ability of Chembio to maintain
existing, and timely obtain additional, regulatory approvals,
particularly for its proposed COVID-19 diagnostic tests, which
approvals are subject to processes that can change recurringly
without notice; Chembio’s dependence upon, and limited experience
with, COVID-19 diagnostic tests; the highly competitive and rapidly
developing market for testing solutions for COVID-19, which
includes a number of competing companies with strong relationships
with current and potential customers, including governmental
authorities, and with significantly greater financial and other
resources that are available to Chembio; and the risks of doing
business with foreign governmental entities, including
geopolitical, international and other challenges as well as
potential material adverse effects of tariffs and other changes in
U.S. trade policy. Chembio undertakes no obligation to publicly
update forward-looking statements in this release to reflect events
or circumstances that occur after the date hereof or to reflect any
change in Chembio's expectations with regard to the forward-looking
statements or the occurrence of unanticipated events. Factors that
may impact Chembio's success are more fully disclosed in Chembio's
periodic public filings with the U.S. Securities and Exchange
Commission, including its Annual Report on Form 10-K for the fiscal
year ended December 31, 2020, particularly under the heading “Risk
Factors.”
DPP is Chembio’s registered trademark, and the
Chembio logo is Chembio’s trademark. For convenience, these
trademarks appear in this release without ® or ™ symbols, but that
practice does not mean that Chembio will not assert, to the fullest
extent under applicable law, its rights to the trademarks. All
other trademarks appearing in this release are the property of
their respective owners.
Investor Relations
ContactPhilip TaylorGilmartin Group(415)
937-5406investor@chembio.com
|
CHEMBIO DIAGNOSTICS, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(Unaudited) |
|
|
|
|
|
For the three months ended |
|
March 31, 2021 |
|
March 31, 2020 |
REVENUES: |
|
|
|
Product revenue |
$ |
4,024,662 |
|
|
$ |
5,716,593 |
|
R&D revenue |
|
1,106,639 |
|
|
|
907,687 |
|
Government grant income |
|
3,350,000 |
|
|
|
- |
|
License and royalty
revenue |
|
243,058 |
|
|
|
235,304 |
|
TOTAL
REVENUES |
|
8,724,359 |
|
|
|
6,859,584 |
|
|
|
|
|
COSTS AND
EXPENSES: |
|
|
|
Cost of product revenue |
|
3,548,441 |
|
|
|
4,374,442 |
|
Research and development
expenses |
|
2,863,338 |
|
|
|
1,958,853 |
|
Selling, general and
administrative expenses |
|
6,085,067 |
|
|
|
4,156,641 |
|
Severance, restructuring and
other related costs |
|
83,087 |
|
|
|
723,118 |
|
Acquisition costs |
|
- |
|
|
|
63,497 |
|
|
|
12,579,933 |
|
|
|
11,276,551 |
|
LOSS FROM
OPERATIONS |
|
(3,855,574 |
) |
|
|
(4,416,967 |
) |
|
|
|
|
OTHER
EXPENSE: |
|
|
|
Interest expense, net |
|
(712,477 |
) |
|
|
(662,141 |
) |
|
|
|
|
LOSS BEFORE INCOME
TAXES |
|
(4,568,051 |
) |
|
|
(5,079,108 |
) |
|
|
|
|
Income tax benefit |
|
67,888 |
|
|
|
79,559 |
|
|
|
|
|
NET LOSS |
$ |
(4,500,163 |
) |
|
$ |
(4,999,549 |
) |
|
|
|
|
Basic and diluted loss
per share |
$ |
(0.22 |
) |
|
$ |
(0.29 |
) |
|
|
|
|
Weighted average
number of shares outstanding, basic and diluted |
|
20,163,386 |
|
|
|
17,197,301 |
|
|
|
|
|
CHEMBIO DIAGNOSTICS, INC. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED BALANCE SHEETS |
AS OF |
|
|
|
|
|
(Unaudited) |
|
|
|
March 31, 2021 |
|
December 31, 2020 |
|
|
|
|
- ASSETS - |
|
|
|
CURRENT
ASSETS: |
|
|
|
Cash and cash equivalents |
$ |
14,350,953 |
|
|
$ |
23,066,301 |
|
Accounts receivable, net of
allowance for doubtful accounts of $354,528 and $296,793 as of
March 31, 2021 and December 31, 2020, respectively |
|
2,413,552 |
|
|
|
3,377,387 |
|
Inventories, net |
|
14,690,627 |
|
|
|
12,516,402 |
|
Prepaid expenses and other
current assets |
|
812,638 |
|
|
|
778,683 |
|
TOTAL CURRENT
ASSETS |
|
32,267,770 |
|
|
|
39,738,773 |
|
|
|
|
|
FIXED
ASSETS: |
|
|
|
Property, plant and equipment,
net |
|
9,582,872 |
|
|
|
8,688,403 |
|
Finance lease right-of-use
asset, net |
|
217,376 |
|
|
|
233,134 |
|
TOTAL FIXED ASSETS,
net |
|
9,800,248 |
|
|
|
8,921,537 |
|
|
|
|
|
OTHER
ASSETS: |
|
|
|
Operating lease right-of-use
assets, net |
|
5,904,299 |
|
|
|
6,112,632 |
|
Intangible assets, net |
|
3,377,003 |
|
|
|
3,645,986 |
|
Goodwill |
|
5,689,315 |
|
|
|
5,963,744 |
|
Deposits and other assets |
|
374,862 |
|
|
|
509,342 |
|
|
|
|
|
TOTAL
ASSETS |
$ |
57,413,497 |
|
|
$ |
64,892,014 |
|
|
|
|
|
- LIABILITIES AND STOCKHOLDERS’ EQUITY - |
|
|
|
CURRENT
LIABILITIES: |
|
|
|
Accounts payable and accrued
liabilities |
$ |
8,396,994 |
|
|
$ |
10,042,790 |
|
Deferred revenue |
|
404,486 |
|
|
|
1,606,997 |
|
Operating lease
liabilities |
|
572,478 |
|
|
|
642,460 |
|
Finance lease liabilities |
|
60,064 |
|
|
|
58,877 |
|
TOTAL CURRENT
LIABILITIES |
|
9,434,022 |
|
|
|
12,351,124 |
|
|
|
|
|
OTHER
LIABILITIES: |
|
|
|
Long-term operating lease
liabilities |
|
6,197,527 |
|
|
|
6,327,143 |
|
Long-term finance lease
liabilities |
|
169,765 |
|
|
|
185,239 |
|
Long-term debt, net |
|
18,327,037 |
|
|
|
18,182,158 |
|
Deferred tax liability |
|
- |
|
|
|
69,941 |
|
TOTAL
LIABILITIES |
|
34,128,351 |
|
|
|
37,115,605 |
|
|
|
|
|
STOCKHOLDERS’
EQUITY: |
|
|
|
Preferred stock – 10,000,000
shares authorized, none outstanding |
|
- |
|
|
|
- |
|
Common stock - $0.01 par
value; 100,000,000 shares authorized; 20,285,695 shares and
20,223,498 shares issued at March 31, 2021 and December 31, 2020,
respectively |
|
202,857 |
|
|
|
202,235 |
|
Additional paid-in
capital |
|
125,425,514 |
|
|
|
124,961,514 |
|
Accumulated deficit |
|
(101,606,494 |
) |
|
|
(97,106,331 |
) |
Treasury stock 41,141 shares
at cost as of March 31, 2021 and December 31, 2020,
respectively |
|
(190,093 |
) |
|
|
(190,093 |
) |
Accumulated other
comprehensive (loss) income |
|
(546,638 |
) |
|
|
(90,916 |
) |
TOTAL STOCKHOLDERS’
EQUITY |
|
23,285,146 |
|
|
|
27,776,409 |
|
|
|
|
|
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY |
$ |
57,413,497 |
|
|
$ |
64,892,014 |
|
|
|
|
|
CHEMBIO DIAGNOSTICS, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWSFOR THE THREE MONTHS
ENDED(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2021 |
|
March 31, 2020 |
|
|
|
|
|
|
|
Net cash used in operating activities |
|
$ |
(7,261,260 |
) |
|
$ |
(5,651,960 |
) |
Net cash used in
investing activities |
|
|
(1,239,168 |
) |
|
|
(1,078,271 |
) |
Net cash used by
financing activities |
|
|
(129,341 |
) |
|
|
(223,290 |
) |
Effect of exchange
rate changes on cash |
|
|
(85,579 |
) |
|
|
(79,814 |
) |
INCREASE IN CASH AND
CASH EQUIVALENTS |
|
|
(8,715,348 |
) |
|
|
(7,033,335 |
) |
Cash and cash equivalents -
beginning of the period |
|
|
23,066,301 |
|
|
|
18,271,352 |
|
Cash and cash
equivalents - end of the period |
|
$ |
14,350,953 |
|
|
$ |
11,238,017 |
|
|
|
|
|
|
|
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