NEW YORK – Amid ongoing pandemic uncertainty, Accelerate Diagnostics continues to build evidence of its ID/AST system's clinical utility and develop new products including Pheno 2.0, a next generation identification (ID) and antimicrobial susceptibility testing (AST) system, its President and CEO Jack Phillip said on a conference call last week.
This year, Accelerate will target new customers with two new products ─ a new IVD configuration of its PhenoTest BC kit that addresses the antimicrobial susceptibility testing needs of laboratories that have rapid identification already in place, and a sample preparation system that automates front-end testing steps to enable rapid identification of bacterial species via MALDI-TOF systems.
"With the impact of the pandemic waning, we will increase the pace of selling our integrated [ID/AST] solution, address the balance of the market with our new product offerings, and open a significantly larger market with Pheno 2.0 ─ collectively bringing a change to the market," Phillips said during the call to discuss the firm's financial results.
The Tuscon, Arizona-based developer of test systems for antibiotic resistance and bloodstream infections reported Thursday that its second quarter revenues rose 33 percent year over year.
In Q2, the company saw an increase in the number of potential new customers, inked new contracts, and went live with tests, signing agreements for 15 instruments and implementing testing with 24 instruments. The company also added "dozens of prospective customers to the sales funnel," Phillips said.
Nonetheless, a surge in US infections as a result of the Delta variant is particularly concerning for Accelerate, and some of the hospitals it is approaching as potential customers have recently begun to focus on COVID-related care.
"In the first quarter, we outlined that increasing the rate of adoption of our integrated ID/AST solution would require a normalization of hospital priorities and access," Phillips said. "In the second quarter, hospital access improved and the number of prospective customer meetings increased. However, there remain lingering pandemic-related impacts, leading to inconsistent access to key hospital stakeholders in regions where fluctuating COVID cases and hospitalizations remain the focus."
That said, in a positive shift for its business, US antimicrobial stewardship teams are starting to reorganize, Phillips said. There's an increasing focus among hospital antimicrobial stewardship teams on how to manage sepsis and other infectious diseases beyond COVID-19, he said, adding it is "more of a prominent discussion today than it has ever been over the past year, and we expect this trend to continue."
With antimicrobial stewardship teams as potential customers, Accelerate's recent product enhancements aim to improve the performance of its ID/AST system and expand its AST menu for bloodstream infections, Phillips said, adding that the company has launched "a series of enhancements, including new drugs, updates to algorithms to address evolving resistance patterns, improvements to reportability, and ecofriendly packaging to improve the shipping and storage of [its] test kits."
The new IVD configuration of its PhenoTest BC kit addresses the needs of laboratories that lack rapid susceptibility results but have diagnostic systems in place that identify disease-causing pathogens. The kit accepts an identification test result and loads an appropriate antibiotic panel to enable susceptibility results in about seven hours after blood culture, Phillips said.
Accelerate recently launched it in the US and Europe, and said it is seeing strong interest from potential customers.
The company is also preparing to launch a sample preparation system, called Arc, to enable rapid MALDI-TOF identification results. "MALDI is the leading method for obtaining an identification result in the US and [Europe, the Middle East, and Africa]," Phillips said, adding that in the US, half of the microbiology laboratories are using MALDI.
However, many of the labs struggle with a cumbersome workflow, he said, adding Accelerate's new product "delivers a substantial improvement in time to result and hands-on time," and combined with MALDI-TOF "will be a good alternative to molecular syndromic panels by giving customers access to a greater menu at a more affordable price."
The firm further expects to expand its available market fourfold and improve its profitability with the development of Pheno 2.0, which will provide ID/AST testing using blood, isolates, and urine. Accelerate plans to launch the platform around the end of 2023.
"Based on continuing prototype testing and ongoing progress, we are increasingly confident that the system will deliver fast and accurate results at a fraction of the size and cost of the current system," he said. "This will allow us to launch Pheno 2.0 in multiple configurations across different sized hospitals and across various higher volume sample types."
Phillips said on Thursday that in the ongoing effort to convince customers of the clinical utility of its tests, Accelerate released data in the second quarter from a study to evaluate the clinical impact of rapid susceptibility testing using its Pheno ID/AST system and test. "This four-hospital study spanning nearly 800 patients compared key clinical outcomes prior to adopting Pheno to their current state of using Pheno many times per day to optimize patient therapy decisions."
The data are among "the most compelling … released to date on the clinical necessity of a rapid susceptibility testing," Phillips said, adding, "The clinical benefits of rapid susceptibility testing are now difficult to challenge and ignore."
Specifically, use of the Pheno system improved time to optimal therapy, and led to reductions in sepsis mortality, acute kidney injury, and the length of stay, he said, adding that "30-day sepsis mortality was … reduced from 15.7 percent to 6 percent."
It is too soon to see the impact of the findings on its business but Accelerate is generating new customer interest as a result of them, Phillips said.
Additionally, over the past year, Accelerate reorganized its business in the EMEA. It "developed a new strategy [in the region] based on focused markets where we believe we can generate the right level of revenue and utilization of Pheno," Phillips said. He added that the EMEA "is having a decent year" despite challenges to accessing hospitals there because of the pandemic. In particular, Accelerate is seeing progress among customers in Italy, Spain, Portugal, Saudi Arabia, and Kuwait.
"Despite pandemic headwinds, which continue to hinder the team’s ability to get in front of customers, this was another quarter of solid work being done under the hood to bring the value of Accelerate’s offerings to the market," William Blair analyst Brian Weinstein said in a research note on Friday. "Looking forward, the priorities for the team remain crystal clear: increase adoption, launch new products, and demonstrate the strength of rapid AST through clinical studies."