Biomerica Reports Financial Results for Fiscal 2023 Second Quarter Ended November 30, 2022

Rhea-AI Summary

Biomerica, Inc. (NASDAQ: BMRA) reported a decline in net sales to $1.5 million for Q2 fiscal 2023, down from $4.6 million in Q2 fiscal 2022, mainly due to decreased demand for Covid-19 tests. However, excluding Covid-19 products, revenue rose by 8%. The company experienced a net loss of $1.6 million, compared to $1.1 million the previous year. The launch of the InFoods® IBS test is expected in Q3, promising personalized dietary solutions for IBS sufferers. The company’s gross margin improved to 24%. Key developments included the recognition of InFoods® IBS data by ACG and sales fulfillment through Amazon for other products.

Positive

• Gross margin increased to 24%, up from 17% year-over-year.
• Excluding Covid-19 sales, revenue increased by 8% compared to the previous year.
• Launch of InFoods® IBS expected to drive future revenue, targeting a significant IBS market.
• Data presented at ACG showed InFoods® significantly improved IBS symptoms.

Negative

• Net loss widened to $1.6 million from $1.1 million year-over-year.
• Net sales decreased from $4.6 million to $1.5 million due to lower demand for Covid-19 tests.

• InFoods® IBS Data Receives American College of Gastroenterology Presidential Award (ACG) Following Presentation at Annual Scientific Meeting
   
• Trial Data Shows InFoods® IBS Treatment Diet Significantly Improved Several IBS Symptoms Including Abdominal Pain Intensity (API): In Some Cases Better Than Certain Currently Marketed Drugs
   
• Launch of InFoods® IBS Lab Developed Test Expected in Fiscal 3Q
   
• Amazon Now Fulfills Sales of Aware® Breast Self Exam and EZ Detect™ Colon Disease Tests

IRVINE, Calif., Jan. 13, 2023 (GLOBE NEWSWIRE) -- IRVINE, CABiomerica, Inc. (Nasdaq: BMRA), (the “Company”) a global provider of advanced medical products, today reported its second quarter fiscal 2023 financial results for the period ended November 30, 2022.

Net sales for the three months ended November 30, 2022 were $1.5 million as compared to net sales of $4.6 million for the same three months in fiscal 2022. The reduction in sales reflects a decline in demand for Covid-19 tests in the quarter. Excluding sales of Covid-19 products, revenues increased 8% for the quarter ended November 30, 2022 as compared to the three months ended November 30, 2021. Net loss was $1.6 million for the three months ended November 30, 2022 compared to a net loss of $1.1 million for the three months ended November 30, 2021. Gross margin during the quarter ended November 30, 2022 increased to 24% as compared to a gross margin of 17% in the second fiscal quarter 2022. Sales, general and administrative expenses for the three months ended November 30, 2022 were $1.6 million, compared to $1.4 million for the same period in the previous year. Cash and cash equivalents at the end of the fiscal second quarter was $5.1 million, a net decrease of $0.8 million during the first six-months of fiscal 2023.

Key Developments During the Quarter:

• InFoods® IBS launch: the Company is working to launch the InFoods IBS laboratory developed test with large GI groups and expects initial revenues from the launch of this product during fiscal Q3 which ends February 28, 2023. Rather than simply treating the symptoms of IBS, the InFoods® IBS platform is designed to identify the unique foods that trigger or worsen IBS symptoms in individual patients, paving the way for more effective treatment. It is estimated that over 40 million Americans suffer from IBS, with symptoms often triggered by consumption of specific foods (which are unique in each sufferer). The total direct and indirect cost of IBS has been estimated at $30 billion annually in the United States alone.
• InFoods®: In the data presented at the ACG annual meeting for the Abdominal Pain Intensity (API) responder endpoint of >30% improvement in pain, patients with IBS Constipation and IBS Mixed in the treatment diet arm had a statistically significant improvement over patients in the placebo diet arm (p-value of 0.0246). The improvement for patients in the treatment arm versus the placebo arm is considered clinically significant and is similar and, in some cases, better than the current drugs in the market.
• H. pylori: After discussions with the FDA, the Company has been asked to run one additional set of tests in-house on the Biomerica hp+detect™ before the FDA can move to clear the product. Biomerica is in the process of running these tests and submitting the results to the FDA. The Biomerica hp+detect™ product is designed to detect the presence of the H. pylori bacteria which infects approximately 35% of the U.S. population. Over 80% of gastric cancers are attributed to H. pylori infection, and gastric cancer is the third most common cause of cancer-related death worldwide.
• Walmart & Aware: During the quarter Walmart began online and in-store sales of the FDA cleared Aware^® Breast Self Exam device. About 80% of breast cancers are detected because women themselves notice changes in their breasts, highlighting the important role that each woman can play in her own health. The Aware® Breast Self Exam device is designed to allow women to enhance tactile sensitivity to changes or irregularities in breast tissue, making breast self-exams easy and convenient.
• EZ Detect and Aware International Approvals: The Company received clearance from the Kingdom of Saudi Arabia Food and Drug Administration (KFDA), and the United Arab Emirates (UAE) Ministry of Health and Prevention (MOHAP) for the EZ Detect™ Colon Disease test and the Aware® Breast Self Exam device. The Company is working with distribution partners to launch the products in these countries and throughout the Middle East and North Africa (MENA) regions.

“We are optimizing the process for GI physicians to order and receive results from the InFoods IBS test for their patients. We believe ease of order and work flow for physicians, with easy to understand and actionable results for patients, is critical to our success. At the same time, we are very honored to be recognized and awarded by the esteemed American College of Gastroenterology for the positive data from the InFoods® IBS trial. The data further confirms our commitment to InFoods which continues to advance as an effective treatment for many patients suffering from irritable bowel syndrome and related gastrointestinal issues,” stated Zackary Irani, CEO of Biomerica. “Further, we are very enthusiastic about receiving clearance to launch sales in Saudi Arabia and other Middle East countries. As we look to the future, we increasingly see new possibilities whereby Biomerica will be enhancing people's lives with science, diet and technology.”

About Biomerica (NASDAQ: BMRA)
Biomerica, Inc. (www.biomerica.com) is a global biomedical technology company that develops, patents, manufactures and markets advanced diagnostic and therapeutic products used at the point-of-care (in home and in physicians' offices) and in hospital/clinical laboratories for detection and/or treatment of medical conditions and diseases. The Company's products are designed to enhance the health and well-being of people, while reducing total healthcare costs. Biomerica primarily focus is on gastrointestinal and inflammatory diseases where the Company has multiple diagnostic and therapeutic products in development.

About InFoods®
The Biomerica InFoods® IBS product is designed to allow physicians a new precision medicine approach to identify patient-specific foods (e.g., eggs, broccoli, wheat, potatoes, pork, etc.), that when removed from the diet, may alleviate or improve an individual's IBS symptoms including, but not limited to, constipation, diarrhea, bloating, cramping, pain and indigestion. This patented, diagnostic-guided therapy is designed to allow for a guided dietary regimen to improve IBS outcomes. A point-of-care version of the product is being developed to allow physicians to perform the test in-office using a finger stick blood sample while a clinical lab version of the product is expected to be the first for which the Company will launch and seek regulatory approval. Since the InFoods® product is a diagnostic-guided therapy, and not a drug, it has no drug type side effects. An estimated 40 million people in America currently suffer from IBS making it a leading cause for patient doctor visits¹.

The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking statements. Certain information included in this press release contains statements that are forward-looking, such as statements relating to the Company’s estimated future financial results, physician and patient demand for the Company's products, the Company's ability to fulfill orders, and possible success of our products in the market, and the possible regulatory approvals needed to sell the company’s products. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future, including, without limitation: results of studies testing the efficacy of the Company’s InFoods® products, hp-detect® test and other products and tests; actual efficacy of the Company’s InFoods® products, hp-detect® test and other products and tests; expected completion of clinical studies and trials; the rapidity of testing results; uniqueness of the Company’s products; regulatory approvals necessary prior to commercialization of the Company’s hp+detect® test, InFoods IBS® test and other products and tests, including FDA clearance, attaining CE Mark and approvals from other international regulatory agencies; availability of the Company’s test kits and other products; capacity, resource and constraints on our suppliers; efficacy of the Company’s InFoods® products, hp-detect® test and other products and tests; regulatory approvals necessary prior to commercialization of the Company’s hp+detect® test, InFoods IBS® test and other products and tests; dependence on our suppliers; dependence on international shipping carriers; governmental import/export regulations; demand for our various tests and other products; competition from other similar products and from competitors that have significantly more financial and other resources available to them; governmental virus control regulations that could make it difficult or impossible for the company to maintain current operations; the Company’s ability to comply with current and future regulations in the countries where our products are made and sold and the Company’s ability to obtain patent protection and freedom to operate on any aspects of its rapid test technologies; future production costs and overhead, sales and administrative costs, R&D expenditures, materials costs, needed inventory reserves, collectability of receivables, legal costs and other extraordinary costs. Accordingly, such results may differ materially from those expressed in any forward-looking statements made by or on behalf of Biomerica. Additionally, potential risks and uncertainties include, among others, fluctuations in the Company's operating results due to its business model and expansion plans, downturns in international and or national economies, the Company's ability to raise additional capital, the competitive environment in which the Company will be competing, and the Company's dependence on strategic relationships. The Company is under no obligation to update any forward-looking statements after the date of this release.

1. Canavan et al. The epidemiology of irritable bowel syndrome Clin Epidemiol. 2014; 6: 71–80. doi: 10.2147/CLEP.S40245

Corporate Contact:
Zack Irani
949-645-2111
zirani@biomerica.com

Source: Biomerica

FAQ

What are Biomerica's second quarter fiscal 2023 financial results?

Biomerica reported net sales of $1.5 million, a decrease from $4.6 million in Q2 fiscal 2022, with a net loss of $1.6 million.

What is the InFoods® IBS test, and when is its launch?

The InFoods® IBS test is designed to identify foods triggering IBS symptoms and is expected to launch in fiscal Q3 2023.

How did Biomerica's gross margin change in Q2 2023?

Biomerica's gross margin improved to 24% in Q2 2023, up from 17% in Q2 2022.

What recognition did the InFoods® IBS data receive?

The InFoods® IBS trial data received a Presidential Award from the American College of Gastroenterology.

What impact did Covid-19 test sales have on Biomerica's revenues?

Covid-19 test sales significantly reduced overall revenues, contributing to a drop from $4.6 million to $1.5 million in net sales.