T2 Biosystems Announces Exclusive U.S. Agreement with Cardinal Health to Sell its FDA-Cleared Direct-From-Blood Diagnostics for Rapid Detection of Sepsis-Causing Pathogens

Rhea-AI Summary

T2 Biosystems (NASDAQ: TTOO) has entered into a multi-year exclusive U.S. agreement with Cardinal Health (NYSE: CAH) for the distribution of its FDA-cleared direct-from-blood diagnostics for rapid sepsis detection. The agreement covers the T2Dx® Instrument, T2Bacteria® Panel, and T2Candida® Panel. This collaboration is expected to significantly expand T2 Biosystems' access to the U.S. hospital market.

T2 Biosystems' technology can detect sepsis-causing pathogens directly from blood in 3-5 hours, without waiting for blood culture results. The T2Bacteria Panel detects six pathogens responsible for nearly 75% of U.S. bacterial bloodstream infections, while the T2Candida Panel detects five Candida species accounting for up to 95% of U.S. Candida bloodstream infections. Both panels demonstrate high sensitivity and specificity.

Positive

• Exclusive distribution agreement with Cardinal Health for U.S. market
• Potential for significant expansion in U.S. hospital market access
• FDA-cleared diagnostics for rapid sepsis detection (3-5 hours)
• High sensitivity and specificity of T2Bacteria and T2Candida panels
• Technology not affected by prior antimicrobial treatment

Negative

• None.

Insights

Medical Research Analyst

This exclusive distribution agreement with Cardinal Health is a significant development for T2 Biosystems. It provides access to Cardinal Health's extensive commercial infrastructure, potentially expanding T2's reach in the U.S. hospital market. The agreement covers T2's FDA-cleared direct-from-blood diagnostics, including the T2Dx® Instrument, T2Bacteria® Panel and T2Candida® Panel.

T2's technology addresses critical shortcomings in current sepsis detection methods. Their tests can detect pathogens directly from blood in 3-5 hours, compared to the typical 2-3 days for blood cultures. This rapid detection could be crucial in improving sepsis outcomes, given that sepsis is the leading cause of death in U.S. hospitals and costs the healthcare system an estimated $62 billion annually.

The market potential is substantial, considering sepsis's prevalence and the limitations of current diagnostic methods. However, the success of this partnership will depend on factors such as hospital adoption rates, reimbursement policies and the technology's performance in real-world settings. Investors should monitor the rollout and initial sales figures to gauge the agreement's impact on T2's revenue and market share.

Financial Analyst

This exclusive distribution agreement represents a potentially transformative opportunity for T2 Biosystems. By partnering with Cardinal Health, a major player in healthcare services and products, T2 gains access to a vast network of hospital customers and specialized sales representatives.

For context, T2 Biosystems is a small-cap company with a market capitalization of about $31.6 million. This deal could significantly boost their sales and market penetration. However, it's important to note that the financial terms of the agreement were not disclosed, making it challenging to quantify the immediate impact on T2's revenues.

Investors should consider several factors:

• Potential for increased revenue growth and market share expansion
• Possible reduction in sales and marketing expenses as Cardinal Health takes on distribution
• The competitive landscape and how this partnership positions T2 against other diagnostic companies
• T2's ability to scale production to meet potentially increased demand

While this agreement is promising, investors should remain cautious and monitor upcoming quarterly reports for concrete evidence of its impact on T2's financial performance.

LEXINGTON, Mass., Oct. 07, 2024 (GLOBE NEWSWIRE) -- T2 Biosystems, Inc. (NASDAQ: TTOO) (the “Company”), a leader in the rapid detection of sepsis-causing pathogens and antibiotic resistance genes, today announced that it has entered into a multi-year exclusive U.S. agreement with Cardinal Health (NYSE: CAH),. Under the agreement, Cardinal Health will have exclusive rights to sell T2 Biosystems’ FDA-cleared direct-from-blood diagnostics for the rapid detection of sepsis-causing pathogens, including the T2Dx^® Instrument, the T2Bacteria^® Panel, and the T2Candida^® Panel.

“We are thrilled to have entered into a distribution agreement with Cardinal Health that will make them the exclusive distributor of our FDA-cleared direct-from-blood diagnostics in the United States which will dramatically increase our representation with hospital customers who are eager to add culture-independent diagnostics to strengthen their sepsis clinical care,” stated John Sperzel, Chairman and CEO of T2 Biosystems. “We expect this collaboration to greatly expand our access to the U.S. hospital market as Cardinal Health has an extensive commercial and distribution infrastructure that includes capital equipment specialists who will sell the T2Dx Instrument.”

Despite the widespread use of blood culture-based diagnostics to detect sepsis-causing pathogens and antibiotic susceptibility, sepsis remains the leading cause of death in U.S. hospitals and claims the lives of approximately 350,000 Americans annually.¹ Sepsis also represents the leading cost of U.S. hospitalization, costing our healthcare system an estimated $62 billion annually.² Lastly, sepsis is the leading cause of 30-day hospital readmission in the U.S., with 19% of sepsis survivors re-hospitalized within 30 days and 40% within 90 days,^3,4,5 which underscores the need for advanced technologies in sepsis detection.

A September 2024 article which appeared in The Lancet, titled “The Culture of Blood Culture,” described the weakness of blood culture, including poor sensitivity (i.e., missed infections), slow time to result (i.e., typically 2-3 days); vulnerability to contamination; reduced effectiveness in patients who have received antibiotics; and a labor-intensive process requiring skilled technicians.

T2 Biosystems has developed the only FDA-cleared diagnostics able to detect sepsis-causing bacterial and fungal pathogens directly-from-blood, in just 3-5 hours, without the need to wait days for a positive blood culture. The T2Bacteria Panel runs on the FDA cleared T2Dx Instrument and detects six pathogens which account for nearly 75% of U.S. bacterial bloodstream infections, with 90% sensitivity and 98% specificity, including E. faecium, S. aureus, K. pneumoniae, A. baumannii, P. aeruginosa, and E. coli. The T2Candida Panel runs on the FDA-cleared T2Dx Instrument and detects five Candida species which account for up to 95% of U.S. Candida blood stream infections, with 91% sensitivity and 99% specificity, including C. albicans, C. tropicalis, C. parapsilosis, C. krusei, and C. glabrata. The T2 Biosystems test panels are not affected by prior antimicrobial treatment.

About Cardinal Health
Cardinal Health is a distributor of pharmaceuticals, a global manufacturer and distributor of medical and laboratory products, and a provider of performance and data solutions for healthcare facilities. With more than 50 years in business, operations in more than 30 countries and approximately 48,000 employees globally, Cardinal Health is essential to care. Information about Cardinal Health is available at cardinalhealth.com.

About T2 Biosystems
T2 Biosystems, a leader in the rapid detection of sepsis-causing pathogens and antibiotic resistance genes, is dedicated to improving patient care and reducing the cost of care by helping clinicians effectively treat patients faster than ever before. T2 Biosystems’ products are powered by the proprietary T2 Magnetic Resonance (T2MR^®) technology and include the T2Dx^® Instrument, the T2Bacteria^® Panel, the T2Candida^® Panel, the T2Resistance^® Panel, and the T2Biothreat™ Panel. T2 Biosystems has an active pipeline of future products, including the U.S. T2Resistance Panel, the T2Lyme™ Panel, and the expended T2Candida Panel to add the detection of Candida auris. For more information, please visit www.t2biosystems.com.

1. Centers for Disease Control https://www.cdc.gov/mmwr/volumes/72/wr/mm7234a2.htm
2. Buchman, T. G., Simpson, S. Q., Sciarretta, K. L., Finne, K. P., Sowers, N., Collier, M., ... & Kelman, J. A. (2020). Sepsis among medicare beneficiaries: 3. The methods, models, and forecasts of sepsis, 2012–2018. Critical care medicine, 48(3), 302-318. https://journals.lww.com/ccmjournal/FullText/2020/03000/Sepsis_Among_Medicare_Beneficiaries__3__The.4.as
3. Fingar K, Washington R. HCUP Statistical Brief #196. November 2015. Agency for Healthcare Research and Quality, Rockville, MD. https://www.hcup-us.ahrq.gov/reports/statbriefs/sb196-Readmissions-Trends-High-Volume-Conditions.jsp
4. Gadre SK, et al. Chest. 2019;155(3):483-490. https://journal.chestnet.org/article/S0012-3692(18)32895-2/abstract
5. Prescott H and Angus D. JAMA. 2018;319(1):91. https://jamanetwork.com/journals/jama/fullarticle/2667724
   

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including, without limitation, statements the likelihood that this collaboration will greatly expand our access to the U.S. hospital market and the potential that hospitals will complement the standard of care with new culture-independent diagnostic technology, as well as statements that include the words “expect,” “may,” “should,” “anticipate,” and similar statements of a future or forward-looking nature. These forward-looking statements are based on management’s current expectations. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, (i) any inability to (a) realize anticipated benefits from commitments, contracts or products; (b) successfully execute strategic priorities; (c) bring products to market; (d) expand product usage or adoption; (e) obtain customer testimonials; (f) accurately predict growth assumptions; (g) realize anticipated revenues; (h) incur expected levels of operating expenses; or (i) increase the number of high-risk patients at customer facilities; (ii) failure of early data to predict eventual outcomes; (iii) failure to make or obtain anticipated FDA filings or clearances within expected time frames or at all; or (iv) the factors discussed under Item 1A. “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the U.S. Securities and Exchange Commission, or SEC, on April 1, 2024, and other filings the Company makes with the SEC from time to time, including our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. These and other important factors could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking statements represent management’s estimates as of the date of this press release. While the Company may elect to update such forward-looking statements at some point in the future, unless required by law, it disclaims any obligation to do so, even if subsequent events cause its views to change. Thus, no one should assume that the Company’s silence over time means that actual events are bearing out as expressed or implied in such forward-looking statements. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to the date of this press release.

Investor Contact:
Philip Trip Taylor, Gilmartin Group
ir@T2Biosystems.com
415-937-5406

FAQ

What is the new distribution agreement for T2 Biosystems (TTOO)?

T2 Biosystems has entered into a multi-year exclusive U.S. agreement with Cardinal Health for the distribution of its FDA-cleared direct-from-blood diagnostics for rapid sepsis detection, including the T2Dx Instrument, T2Bacteria Panel, and T2Candida Panel.

How quickly can T2 Biosystems' (TTOO) technology detect sepsis-causing pathogens?

T2 Biosystems' technology can detect sepsis-causing bacterial and fungal pathogens directly from blood in just 3-5 hours, without the need to wait days for a positive blood culture.

What pathogens can the T2Bacteria Panel from T2 Biosystems (TTOO) detect?

The T2Bacteria Panel detects six pathogens which account for nearly 75% of U.S. bacterial bloodstream infections: E. faecium, S. aureus, K. pneumoniae, A. baumannii, P. aeruginosa, and E. coli.

What is the sensitivity and specificity of T2 Biosystems' (TTOO) T2Candida Panel?

The T2Candida Panel has 91% sensitivity and 99% specificity for detecting five Candida species which account for up to 95% of U.S. Candida bloodstream infections.