Biodesix Announces Third Quarter 2020 Results and Provides Corporate Update

Rhea-AI Summary

Biodesix reported record revenue of $9.2 million for Q3 2020, a 133% increase from the previous year, primarily driven by $5.5 million from COVID-19 diagnostic tests. The company completed a successful IPO, raising approximately $63 million. However, operating loss decreased to $6.2 million, down 31% year-over-year. Research expenses rose by 15%, while total cash reserves increased to $6.3 million as of September 30, 2020. The strategic partnership for COVID-19 testing further highlights the company’s role in the pandemic response.

Positive

• Record revenue of $9.2 million in Q3 2020, a 133% increase from Q3 2019.
• Successful IPO raised net proceeds of approximately $63 million.
• Strategic partnership with Big Ten Conference for COVID-19 testing.
• Nodify XL2® test data published in CHEST Journal shows sustained benign diagnosis.

Negative

• Operating loss of $6.2 million remains substantial despite a decrease from $9.0 million in Q3 2019.
• Net loss increased by 11% in the nine months ending September 30, 2020, totaling $26.8 million.

BOULDER, Colo.--(BUSINESS WIRE)--Biodesix, Inc. a leading data-driven diagnostic solutions company with a focus in lung disease, today announced financial and operating results for the third quarter ended September 30, 2020 and provided a corporate update.

Third Quarter 2020 and Recent Highlights

• Generated record quarterly revenue of $9.2 million for the third quarter ended September 30, 2020.
• Completed initial public offering (IPO) that raised net proceeds of approximately $63 million after deducting offering costs, underwriting discounts and commissions.
• Announced a strategic partnership with the Big Ten Conference whereby Biodesix is conducting ddPCR™ COVID-19 validation testing and managing the onsite testing of rapid antigen SARS-CoV-2 testing for all student-athletes and staff personnel involved in close contact sports competition.
• Published an extended analysis of data from the company’s Nodify XL2® lung nodule test in the American College of Chest Physicians (CHEST) Journal. The data demonstrate that all nodules in the study group that were established as benign after one year remained benign after two years, the guideline-recommended surveillance period to radiologically confirm a benign diagnosis.
• Presented data from three studies at the American College of Chest Physicians (CHEST 2020) Annual Meeting highlighting the clinical value of the company’s Nodify XL2® and Nodify CDT™ lung nodule risk assessment tests.

“We recently achieved a very significant milestone with our IPO and transition to a public company,” stated Scott Hutton, Chief Executive Officer of Biodesix. “With the proceeds from the offering, we plan to continue to market our suite of commercially available diagnostic tests, including our Biodesix Lung Reflex® and Nodify Lung™ testing strategies, in addition to our COVID-19 testing, while also investing in the discovery, development, and validation of innovative new tests leveraging our proprietary AI-driven discovery platform.

“We continue to monitor the COVID-19 pandemic carefully in light of the recent surge in case counts around the country, and we are pleased to be able to play an important part in the fight against this dangerous virus through our WorkSafe testing program. To this point, our lung disease-focused core business continues to perform well even while healthcare facilities devote time and resources to combat COVID-19 and travel restrictions affect our commercial efforts. We believe this is a testament to the valuable clinical information that our tests provide along critical points of the lung disease care continuum,” concluded Mr. Hutton.

Financial Results

Revenue. Revenue for the three months ended September 30, 2020 was $9.2 million, as compared to $3.9 million for the comparable period in 2019, an increase of 133%. This increase was due to $5.5 million of revenue from our two COVID-19 diagnostic tests, partially offset by a modest decline in our non-COVID-19 diagnostic test volumes of $0.7 million as health care practitioners, including pulmonologists, were increasingly diverted to pandemic-related care. In addition, company sales efforts continued to be impacted by travel and other COVID-19 pandemic related restrictions. Revenue for the nine months ended September 30, 2020 was $18.5 million, as compared to $16.3 million for the comparable period in 2019, an increase of 14%.

Direct costs and expenses. Direct costs and expenses for the three months ended September 30, 2020 were $3.9 million, as compared to $1.5 million for the comparable period of 2019, an increase of 159%. Direct costs and expenses for the nine months ended September 30, 2020 were $7.3 million compared to $4.2 million for the nine months ended September 30, 2019, an increase of 73%. The increase in costs were primarily driven by the release of the company’s Nodify CDT™ test and its COVID-19 testing program in 2020.

Research and development. Research and development expenses for the three months ended September 30, 2020 were $2.7 million, as compared to $2.4 million for the comparable period in 2019, an increase of 15%. Research and development expenses for the nine months ended September 30, 2020 were $7.7 million, as compared to $8.0 million for the comparable period in 2019, a decrease of 3%.

Sales, marketing, general and administrative. Sales, marketing, general and administrative expenses for the three months ended September 30, 2020 were $7.9 million, as compared to $8.2 million for the comparable period in 2019, a decrease of 4%. Sales, marketing, general and administrative expenses for the nine months ended September 30, 2020 were $22.8 million, as compared to $24.1 million for the comparable period in 2019, a decrease of 5%. The decrease was driven by reductions in travel and related expenses as the COVID-19 pandemic reduced or eliminated the travel and related expenses.

Operating loss. Operating loss for the three months ended September 30, 2020 was $6.2 million, as compared to an operating loss of $9.0 million for the comparable period in 2019, a decrease of 31%. Operating loss for the nine months ended September 30, 2020 was $20.3 million, as compared to an operating loss of $23.2 million for the comparable period in 2019, a decrease of 13%. The decrease was due in part to higher revenue in the third quarter of 2020 as compared to the third quarter of 2019.

Net loss. Net loss for the three months ended September 30, 2020 was $8.9 million, as compared to $9.6 million for the comparable period in 2019, a decrease of 8%. Net loss for the nine months ended September 30, 2020 was $26.8 million, as compared to $24.2 million for the comparable period in 2019, an increase of 11%.

Cash and cash equivalents. As of September 30, 2020, the company held cash and cash equivalents of $6.3 million, as compared to $5.3 million as of December 31, 2019. Subsequent to the end of the third quarter, the company completed a successful initial public offering that raised net proceeds of approximately $63 million. As a result of the completion of the initial public offering, the company estimates that it has sufficient cash resources to meet its cash obligations through at least the next 12 months.

About Biodesix

Biodesix is a leading diagnostic company with a focus in lung disease. The company develops diagnostic tests addressing important clinical questions by combining multi-omics through the power of artificial intelligence. Biodesix is the first company to offer six non-invasive tests for patients with diseases of the lung. Biodesix launched the SARS-CoV-2 ddPCR™ test and the Platelia SARS-CoV-2 Total Ab in response to the global pandemic and virus that impacts the lung and causes COVID-19. The blood based Biodesix Lung Reflex® strategy for lung cancer patients integrates the GeneStrat® and VeriStrat® tests to support treatment decisions with results in 72 hours, expediting time to treatment. The blood based Nodify Lung™ nodule risk assessment testing strategy, consisting of the Nodify XL2® and the Nodify CDT™ tests, evaluates the risk of malignancy in incidental pulmonary nodules, enabling physicians to better triage patients to the most appropriate course of action. Biodesix also collaborates with many of the world’s leading biotechnology and pharmaceutical companies to solve complex diagnostic challenges in lung disease. For more information about Biodesix, visit biodesix.com.

Note Regarding Forward-Looking Statements

This press release may contain forward-looking statements that involve substantial risks and uncertainties for purposes of the safe harbor provided by the Private Securities Litigation Reform Act of 1995. All statements contained in this press release other than statements of historical fact, are forward-looking statements. The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “plan,” “expect,” “predict,” “potential,” “opportunity,” “goals,” or “should,” and similar expressions are intended to identify forward-looking statements. Such statements are based on management’s current expectations and involve risks and uncertainties. Actual results and performance could differ materially from those projected in the forward-looking statements as a result of many factors. Biodesix has based these forward-looking statements largely on its current expectations and projections about future events and trends. These forward-looking statements are subject to a number of risks, uncertainties and assumptions. Forward-looking statements may include information concerning the impact of the COVID-19 pandemic on Biodesix and its operations, its possible or assumed future results of operations, including descriptions of its revenues, profitability, outlook and overall business strategy. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Factors that could cause actual results to differ materially from those contemplated in this press release can be found in the Risk Factors section of Biodesix’s public filings with the Securities and Exchange Commission, including Biodesix’s final prospectus filed on October 29, 2020 under Rule 424(b)(4) in connection with the company’s initial public offering. Biodesix undertakes no obligation to revise or publicly release the results of any revision to such forward-looking statements, except as required by law. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. All forward-looking statements are qualified in their entirety by this cautionary statement.

Biodesix, Inc.
Consolidated Balance Sheet (unaudited)
(in thousands, except per share data)
		September 30, 2020				December 31, 2019
Assets
Current assets
Cash and cash equivalents		$	6,348			$	5,286
Accounts receivable			5,396				5,292
Other current assets			6,405				2,122
Total current assets			18,149				12,700
Non‑current assets
Property and equipment, net			3,005				2,120
Intangible assets, net			13,667				15,092
Deposits			95				90
Goodwill			11,631				11,631
Total non‑current assets			28,398				28,933
Total assets		$	46,547			$	41,633
Liabilities and Stockholders' Deficit
Current liabilities
Accounts payable		$	3,485			$	1,717
Accrued liabilities			6,953				4,180
Deferred revenue			5,673				1,283
Convertible notes payable			26,600				12,159
Current portion of note payable			7,202				—
Put option liability			6,650				3,261
Total current liabilities			56,563				22,600
Non‑current liabilities
Warrant liability			403				329
Other liabilities			392				358
Long‑term notes payable			17,236				23,812
Paycheck protection program note payable			3,099				—
Contingent consideration			30,071				29,114
Total non‑current liabilities			51,201				53,613
Total liabilities			107,764				76,213
Commitments and contingencies
Convertible Preferred stock
Convertible preferred stock, $0.001 par value, 185,432,719 (2020) and 174,237,067 (2019) authorized; 118,766,273 (2020 and 2019) issued and outstanding; liquidation preference of $202,582 (2020 and 2019)			193,959				193,959
Stockholders' deficit
Common stock, $0.001 par value, 220,000,000 (2020) and 190,000,000 (2019) authorized; 289,508 (2020) and 254,918 (2019) issued and outstanding			2				1
Additional paid‑in capital			2,503				2,324
Accumulated deficit			(257,681	)			(230,864	)
Total stockholders' deficit			(255,176	)			(228,539	)
Total liabilities, convertible preferred stock, and stockholders' deficit		$	46,547			$	41,633

Biodesix, Inc.
Condensed Statements of Operations (unaudited)
(in thousands, except share data)
		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2020				2019				2020				2019
Revenues		$	9,193			$	3,942			$	18,528			$	16,281
Operating expenses
Direct costs and expenses			3,891				1,503				7,346				4,244
Research and development			2,706				2,359				7,713				7,966
Sales, marketing, general and administrative			7,879				8,212				22,793				24,080
Accretion of contingent consideration			957				896				2,901				2,525
Change in fair value of contingent consideration			-				-				(1,944	)			663
Total operating expenses			15,433				12,970				38,809				39,478
Loss from operations			(6,240	)			(9,028	)			(20,281	)			(23,197	)
Interest expense			(2,658	)			(706	)			(6,899	)			(2,005	)
Other income, net			53				133				363				1,001
Net loss		$	(8,845	)		$	(9,601	)		$	(26,817	)		$	(24,201	)
Net loss per share, basic and diluted		$	(31.93	)		$	(39.35	)		$	(99.69	)		$	(103.87	)
Weighted-average shares outstanding, basic and diluted			277				244				269				233