Precipio Signs First Major International Services Contract
April 29 2019 - 8:35AM
Specialty cancer diagnostics company Precipio, Inc. (NASDAQ: PRPO)
today announced that it has signed a services contract with a
health care management group serving several major hospitals based
in Cairo, Egypt. Precipio is engaged to provide both expert
pathology diagnostic services as well as access to proprietary
technologies developed by Precipio.
Initially, the contract calls for sending patient biopsies for
primary diagnosis and secondary (consult) opinion. Follow-on
intended business collaborations will include the establishment of
laboratory operations within Egypt that will license Precipio’s
proprietary technologies to provide liquid biopsy testing using
ICE-COLD PCR technology, and HemeScreen for hematologic molecular
testing.
Based on historic volumes, Precipio anticipates significant
first year revenues. In addition, once Precipio’s liquid biopsy and
HemeScreen tests are available within Egypt, revenues will be
substantially augmented from sales of Precipio’s tests. Initial
testing revenues are forecasted to start by the end of Q2, pending
the final completion of several setup, logistics and regulatory
tasks.
This services contract is another example of the rapid and
effective deployment of Precipio’s global initiative, enabling the
provision by Precipio of premier pathology services while utilizing
the expertise of leading expert cancer pathologists from members of
its academic network such as Yale, Harvard and the University of
Pennsylvania.
Financial impact to Precipio
The Company projects that second half of 2019 consolidated
revenues and gross profits will be substantially increased, subject
to completion of necessary logistics and compliance requirements.
Accordingly, the projected increased revenue from growing our
domestic business along with the global revenue volume will enable
Precipio to optimize economies of scale. As such, early estimates
project H2-2019 gross margin to improve by 20 to 25 points; while
benefiting from the pre-paid cash aspect of international business
(unlike the domestic reimbursement challenges). Hence, management
anticipates that the company’s cash burn is similarly expected to
decrease.
All in all, Precipio anticipates that when considering these
factors, it is likely that these steps, combined, will have a
positive impact on the company’s breakeven point, and a reduction
of the company's capital needs.
By gaining access to Precipio’s network of expert academic
pathologists, treating physicians are able to benefit from
Precipio’s delivery model which is designed to drive more accurate
diagnoses which are more likely to enable better targeted treatment
options. Furthermore, with access to some of the advanced
technologies developed by Precipio, laboratories in Egypt may be
able to improve their value proposition to their patients with
cutting edge testing.
“I am delighted to see the benefits of our international efforts
beginning to capitalize on Precipio’s platform and technologies and
deliver the highest level of expertise to patients worldwide,''
said Ilan Danieli, Precipio’s CEO. “The international segment of
our business is going to be a valuable contributor to our revenues,
margins and cash flow in the coming quarters.”
About Precipio
Precipio has built a platform designed to eradicate the problem
of misdiagnosis by harnessing the intellect, expertise and
technology developed within academic institutions and delivering
quality diagnostic information to physicians and their patients
worldwide. Through its collaborations with world-class academic
institutions specializing in cancer research, diagnostics and
treatment such as the Yale School of Medicine and Harvard’s
Dana-Farber Cancer Institute, Precipio offers a new standard of
diagnostic accuracy enabling the highest level of patient care. For
more information, please visit www.precipiodx.com.
Forward-Looking Statements
Certain statements in this press release constitute
“forward-looking statements,” within the meaning of federal
securities laws including financial projections related thereto and
potential market opportunity, plans and prospects and other
statements containing the words “anticipate,” “intend,” “may,”
“plan,” “predict,” “will,” “would,” “could,” “should,” and similar
expressions, constitute forward-looking statements within the
meaning of The Private Securities Litigation Reform Act of 1995.
The Company's actual results could differ materially from those
anticipated in these forward-looking statements as a result of
various factors. Factors that could cause future results to
materially differ from the recent results or those projected in
forward-looking statements include the known risks, uncertainties
and other factors described in the Company’s Annual Report on Form
10-K for the year ended December 31, 2018 as filed on April 16,
2019 as well as the Company’s prior filings and from time to time
in the Company’s subsequent filings with the Securities and
Exchange Commission. Any change in such factors, risks and
uncertainties may cause the actual results, events and performance
to differ materially from those referred to in such statements. All
information in this press release is as of the date of the release
and the Company does not undertake any duty to update this
information, including any forward-looking statements, unless
required by law.
Inquiries:
investors@precipiodx.com
+1-203-787-7888
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