Oncocyte Reports First Quarter 2024 Financial Results
Oncocyte (Nasdaq: OCX) reported Q1 2024 financial results, highlighting key developments. The company formed a global commercialization partnership with Bio-Rad Labs, raised $15.8M from equity private placement, and reduced cash burn to $3.9M. However, net revenue fell by 41% YOY to $176K. Research and development expenses rose by 2% to $2.2M, while general and administrative expenses decreased by 22% to $2.7M. The loss from operations was $9.3M, compared to a $5.9M income in Q1 2023, mainly due to a $3.3M loss from the change in fair value of contingent consideration. Oncocyte is set to ship its GraftAssure transplant monitoring test kits globally in 2Q 2024 and is advancing other diagnostic tests.
- Raised $15.8M in gross proceeds from equity private placement.
- Reduced cash burn to $3.9M, below the $5M target.
- Formed a global commercialization partnership with Bio-Rad Laboratories.
- On track to ship GraftAssure transplant monitoring test kits in 2Q 2024.
- Received positive response from prospective customers for GraftAssure.
- General and administrative expenses decreased by 22% to $2.7M.
- Developing regulated products including VitaGraft Kidney IVD.
- Net revenue decreased by 41% YOY to $176K.
- Loss from operations was $9.3M, compared to a $5.9M income in Q1 2023.
- Unrealized noncash change in fair value of contingent consideration resulted in a $3.3M loss.
- Research and development expenses increased by 2% to $2.2M.
- Sales and marketing expenses increased by 22% to $846K.
Insights
Oncocyte's first-quarter financial results show a mixed bag.
The strategic partnership with Bio-Rad and the
However, the loss from operations at
Oncocyte's market entry strategy with the launch of GraftAssure RUO transplant rejection diagnostic test kit is noteworthy. Their partnership with Bio-Rad enables them to rapidly penetrate the transplant monitoring market, which is a growing sector. The global commercial strategy spanning the U.S., EU and Asia, if executed well, can provide Oncocyte with a significant market share.
Positive feedback from prospective customers, emphasizing the affordability, turnaround time and ease of use of GraftAssure, is a strong indicator of the product's potential market acceptance. This, coupled with their cost-control measures, presents a well-rounded strategy for growth despite current financial setbacks.
However, the
Conference Call on Wednesday, May 15, 2024 at 1:30 p.m. PT / 4:30 p.m. ET
IRVINE, Calif., May 15, 2024 (GLOBE NEWSWIRE) -- Oncocyte Corporation (Nasdaq: OCX), a precision diagnostics company, today reported financial results for the quarter ended March 31, 2024.
Recent Highlights
- Announced global commercialization partnership with Bio-Rad Laboratories, Inc.
- On track to ship research use only (RUO) GraftAssure™ transplant monitoring test kits to initial customers in Asia, the U.S., and the EU in 2Q 2024. IVD kits are under development for FDA submission.
- Raised
$15.8 million in gross proceeds from equity private placement; as part of the financing, Bio-Rad purchased8.99% of Oncocyte; new and existing investors invested as well. - Reduced cash burn to
$3.9 million , reflecting capital-efficient business model.
“In the first quarter of 2024, Oncocyte made significant progress toward commercializing its innovative blood-based diagnostic tests. That progress was bolstered by a
“The Bio-Rad partnership validates the efficacy and market opportunity of our proprietary assays and enables us to rapidly enter the growing transplant monitoring market at key academic centers with GraftAssure RUO. It also lays the groundwork for broader commercial expansion. Together with Bio-Rad, we are developing regulated products including VitaGraft™ Kidney IVD, and preparing for clinical adoption. Additionally, our technology has been selected to support multiple Phase 2 clinical studies by pharmaceutical companies that are developing therapeutics to treat and manage anti-body mediated rejection. These therapeutic studies may unlock valuable new commercial applications.”
“Building on the momentum of these achievements, we are preparing to ship to several initial commercial customers in the U.S., the EU, and Asia in Q2. We are encouraged by prospective customers’ positive response to GraftAssure’s superior affordability, turn-around-time, and ease of use. We are well-positioned to achieve numerous critical commercial and regulatory milestones throughout 2024 and into 2025. We also are continuing to advance the development of our oncology diagnostics pipeline products, DetermaIO and DetermaCNI. Lastly, in Q1 2024, our cash burn stayed low at
2024 First Quarter Financial Results
Net revenue for the three months ended March 31, 2024 was
Total cost of revenues for the three months ended March 31, 2024 was
Research and development expense for the three months ended March 31, 2024 was
The increase was driven by continued focused investment in developing kitted versions of assays including DetermaIO™, VitaGraft™ and DetermaCNI™.
Sales and marketing expense for the three months ended March 31, 2024 was
General and administrative expense for the three months ended March 31, 2024 was
Loss from operations for the three months ended March 31, 2024 was
For Oncocyte’s complete financial results for the first quarter ended March 31, 2024, see the Company’s quarterly Form 10-Q to be filed with the Securities and Exchange Commission on May 15, 2024.
Webcast and Conference Call Information
Oncocyte will host a conference call to discuss first quarter 2024 financial results after market close on Wednesday, May 15, 2024 at 1:30 p.m. Pacific Time / 4:30 p.m. Eastern Time. The conference call may be accessed live via telephone by dialing toll free (800) 715-9871 for both domestic and international callers. Once dialed in, ask to be joined to the Oncocyte Corporation call. The live webcast of the call may be accessed by visiting the “Events & Presentation” section of the Company’s website at https://investors.oncocyte.com.
About Oncocyte
Oncocyte is a precision diagnostics company. The Company’s tests are designed to help provide clarity and confidence to physicians and their patients. VitaGraft™ is a clinical blood-based solid organ transplantation monitoring test. GraftAssure™ is a research use only (RUO) blood-based solid organ transplantation monitoring test. DetermaIO™ is a gene expression test that assesses the tumor microenvironment to predict response to immunotherapies. DetermaCNI™ is a blood-based monitoring tool for monitoring therapeutic efficacy in cancer patients. For more information about Oncocyte, please visit https://oncocyte.com/. More information about our products, please visit the following web pages:
VitaGraft Kidney™ - https://oncocyte.com/vitagraft-kidney/
VitaGraft Liver™ - https://oncocyte.com/vitagraft-liver/
GraftAssure™ - https://oncocyte.com/graftassure/
DetermaIO™ - https://oncocyte.com/determa-io/
DetermaCNI™ - https://oncocyte.com/determa-cni/
VitaGraft™, GraftAssure™, DetermaIO™, and DetermaCNI™ are trademarks of Oncocyte Corporation.
Forward-Looking Statements
Any statements that are not historical fact (including, but not limited to statements that contain words such as “will,” “believes,” “plans,” “anticipates,” “expects,” “estimates,” “may,” and similar expressions) are forward-looking statements. These statements include those pertaining to, among other things, the anticipated launch of the Company’s GraftAssure RUO transplant rejection diagnostic test and the Company’s rapid entry into the transplant monitoring market at key academic centers, the expectation that the Company and Bio-Rad will successfully develop regulated products, including VitaGraft Kidney IVD, the Company’s high-margin and low-complexity business model, anticipated shipments to commercial customers in Q2, the belief that the Company is well positioned to meet numerous critical commercial and regulatory milestones throughout 2024 and into 2025, and other statements about the future expectations, beliefs, goals, plans, or prospects expressed by management. Forward-looking statements involve risks and uncertainties, including, without limitation, risks inherent in the development and/or commercialization of diagnostic tests or products, uncertainty in the results of clinical trials or regulatory approvals, the capacity of Oncocyte’s third-party supplied blood sample analytic system to provide consistent and precise analytic results on a commercial scale, potential interruptions to supply chains, the need and ability to obtain future capital, maintenance of intellectual property rights in all applicable jurisdictions, obligations to third parties with respect to licensed or acquired technology and products, the need to obtain third party reimbursement for patients’ use of any diagnostic tests. Oncocyte or its subsidiaries commercialize in applicable jurisdictions, and risks inherent in strategic transactions such as the potential failure to realize anticipated benefits, legal, regulatory or political changes in the applicable jurisdictions, accounting and quality controls, potential greater than estimated allocations of resources to develop and commercialize technologies, or potential failure to maintain any laboratory accreditation or certification. Actual results may differ materially from the results anticipated in these forward-looking statements and accordingly such statements should be evaluated together with the many uncertainties that affect the business of Oncocyte, particularly those mentioned in the “Risk Factors” and other cautionary statements found in Oncocyte’s Securities and Exchange Commission (SEC) filings, which are available from the SEC’s website. You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they were made. Oncocyte undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law.
CONTACT:
Jeff Ramson
PCG Advisory
(646) 863-6893
jramson@pcgadvisory.com
- Tables Follow -
ONCOCYTE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
| March 31, | December 31, | |||||||
| 2024 | 2023 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Cash and cash equivalents | $ | 5,578 | $ | 9,432 | ||||
| Accounts receivable, net of allowance for credit losses of | 161 | 484 | ||||||
| Prepaid expenses and other current assets | 735 | 643 | ||||||
| Assets held for sale | 61 | 139 | ||||||
| Total current assets | 6,535 | 10,698 | ||||||
| NONCURRENT ASSETS | ||||||||
| Right-of-use and financing lease assets, net | 2,199 | 1,637 | ||||||
| Machinery and equipment, net, and construction in progress | 3,528 | 3,799 | ||||||
| Intangible assets, net | 56,573 | 56,595 | ||||||
| Restricted cash | 1,700 | 1,700 | ||||||
| Other noncurrent assets | 438 | 463 | ||||||
| TOTAL ASSETS | $ | 70,973 | $ | 74,892 | ||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable | $ | 908 | $ | 953 | ||||
| Accrued compensation | 2,427 | 1,649 | ||||||
| Accrued royalties | 1,116 | 1,116 | ||||||
| Accrued expenses and other current liabilities | 741 | 452 | ||||||
| Accrued severance from acquisition | 2,314 | 2,314 | ||||||
| Right-of-use liabilities, current | 821 | 665 | ||||||
| Current liabilities of discontinued operations | - | 45 | ||||||
| Total current liabilities | 8,327 | 7,194 | ||||||
| NONCURRENT LIABILITIES | ||||||||
| Right-of-use liabilities, noncurrent | 2,514 | 2,204 | ||||||
| Contingent consideration liabilities | 43,212 | 39,900 | ||||||
| TOTAL LIABILITIES | 54,053 | 49,298 | ||||||
| Commitments and contingencies | ||||||||
| Series A Redeemable Convertible Preferred Stock, no par value; stated value | 5,332 | 5,126 | ||||||
| SHAREHOLDERS’ EQUITY | ||||||||
| Preferred stock, no par value, 5,000 shares authorized; no shares issued and outstanding | - | - | ||||||
| Common stock, no par value, 230,000 shares authorized; 8,273 and 8,261 shares issued and outstanding at March 31, 2024 and December 31, 2023, respectively | 310,553 | 310,295 | ||||||
| Accumulated other comprehensive income | 40 | 49 | ||||||
| Accumulated deficit | (299,005 | ) | (289,876 | ) | ||||
| Total shareholders’ equity | 11,588 | 20,468 | ||||||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 70,973 | $ | 74,892 | ||||
ONCOCYTE CORPORATION
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
| Three Months Ended | ||||||||
| March 31, | ||||||||
| 2024 | 2023 | |||||||
| Net revenue | $ | 176 | $ | 297 | ||||
| Cost of revenues | 252 | 265 | ||||||
| Cost of revenues – amortization of acquired intangibles | 22 | 22 | ||||||
| Gross (loss) profit | (98 | ) | 10 | |||||
| Operating expenses: | ||||||||
| Research and development | 2,169 | 2,127 | ||||||
| Sales and marketing | 846 | 695 | ||||||
| General and administrative | 2,673 | 3,412 | ||||||
| Change in fair value of contingent consideration | 3,312 | (18,307 | ) | |||||
| Impairment loss | - | 4,950 | ||||||
| Impairment loss on held for sale assets | 169 | 1,283 | ||||||
| Total operating expenses (credits) | 9,169 | (5,840 | ) | |||||
| (Loss) income from operations | (9,267 | ) | 5,850 | |||||
| Other (expenses) income: | ||||||||
| Interest expense | (15 | ) | (11 | ) | ||||
| Unrealized gain on marketable equity securities | - | 121 | ||||||
| Other income (expenses), net | 153 | (1 | ) | |||||
| Total other income | 138 | 109 | ||||||
| (Loss) income before income taxes | (9,129 | ) | 5,959 | |||||
| Income taxes | - | - | ||||||
| (Loss) income from continuing operations | (9,129 | ) | 5,959 | |||||
| Loss from discontinued operations | - | (2,926 | ) | |||||
| Net (loss) income | $ | (9,129 | ) | $ | 3,033 | |||
| Net (loss) income per share: | ||||||||
| Net (loss) income from continuing operations - basic and diluted | $ | (9,335 | ) | $ | 4,899 | |||
| Net loss from discontinued operations - basic and diluted | $ | - | $ | (2,502 | ) | |||
| Net (loss) income attributable to common stockholders - basic and diluted | $ | (9,335 | ) | $ | 2,397 | |||
| Net (loss) income from continuing operations per share - basic and diluted | $ | (1.13 | ) | $ | 0.82 | |||
| Net loss from discontinued operations per share - basic and diluted | $ | - | $ | (0.42 | ) | |||
| Net (loss) income attributable to common stockholders per share - basic and diluted | $ | (1.13 | ) | $ | 0.40 | |||
| Weighted average shares outstanding - basic | 8,264 | 5,958 | ||||||
| Weighted average shares outstanding - diluted | 8,264 | 5,963 | ||||||
Oncocyte Corporation
Reconciliation of Non-GAAP Financial Measure
Consolidated Adjusted Loss from Operations
Note: In addition to financial results determined in accordance with U.S. generally accepted accounting principles (“GAAP”), this press release also includes a non-GAAP financial measure (as defined under SEC Regulation G). We believe the adjusted amounts are more representative of our ongoing performance. The following is a reconciliation of the non-GAAP measure to the most directly comparable GAAP measure:
| Three Months Ended | |||||||||||
| March 31, | December 31, | March 31, | |||||||||
| 2024 | 2023 | 2023 | |||||||||
| (unaudited) | (unaudited) | (unaudited) | |||||||||
| Consolidated GAAP (loss) income from operations | $ | (9,267 | ) | $ | (16,179 | ) | $ | 5,850 | |||
| Stock-based compensation | 418 | 484 | 816 | ||||||||
| Severance charge | - | 2 | 14 | ||||||||
| Depreciation and amortization expense | 335 | 325 | 472 | ||||||||
| Change in fair value of contingent consideration | 3,312 | 11,185 | (18,307 | ) | |||||||
| Impairment losses | - | (4 | ) | 4,950 | |||||||
| Impairment loss on held for sale assets | 169 | - | 1,283 | ||||||||
| Consolidated Non-GAAP loss from operations, as adjusted | $ | (5,033 | ) | $ | (4,187 | ) | $ | (4,922 | ) | ||
FAQ
What were Oncocyte's net revenues for Q1 2024?
What caused the increased loss in operations for Oncocyte in Q1 2024?
How much did Oncocyte raise in gross proceeds during Q1 2024?
What is the cash burn rate reported by Oncocyte for Q1 2024?
What are the future plans for Oncocyte's GraftAssure test kits?
What is the significance of Oncocyte's partnership with Bio-Rad Laboratories?
How have Oncocyte's general and administrative expenses changed in Q1 2024?
What are the main reasons for the decrease in Oncocyte's net revenue in Q1 2024?
