NEW YORK (GenomeWeb) – Biocept reported after the close of the market Thursday that its third quarter 2017 revenues rose around 10 percent year over year.
The liquid biopsy assay developer reported total revenues of $1.1 million for the three months ended Sept. 30, up from $1 million in the same period last year.
Of the $1.1 million of revenues recognized during Q3 2017, $900,000 was revenues recognized on an accrual basis and $102,000 reflected the receipt of cash. Biocept converted from cash-based to accrual-based reporting in Q1 of this year.
Overall revenue included $67,000 from development services and $1.0 million in commercial test revenues from the accession of 1,343 samples — 7 percent more than the 1,179 samples the company saw in Q3 2016. Among these, 1,203 samples were billable samples, a 2 increase over 1,183 billable samples accessioned during the third quarter of 2016.
"This has been a productive period in developing new distribution channels, launching key biomarker tests, and initiating an important clinical study all aimed at supporting further physician adoption of our Target Selector liquid biopsy platform," Biocept President and CEO Michael Nall said in a statement.
Nall highlighted Biocept's recent distribution agreement with VWR and its newly launched Pathology Program, which allows labs to perform part of the company's test process in house, as key steps toward the company's goal of advancing distribution of its patented technologies.
"No one else is offering pathologists a chance to be part of value stream like we are," he added in a call discussing the firm's results. "And it is these pathologists who are in a great position to advocate for liquid biopsy."
The firm is also still focused on its clinical testing services, Nall said. With the addition this August of a test for NRAS mutations, the company's menu now comprises 15 biomarkers including all of the markers recommended by National Comprehensive Cancer Network guidelines for both melanoma and colorectal cancer.
Nall also said that Biocept has now validated its testing platform in pancreatic and ovarian cancers bringing the total number of cancer types it addresses to eight. These new indications are expected to help the firm's sales force continue to grow adoption of its tests by physicians.
He also noted that while some labs are facing price erosion next year due to the Protecting Access to Medicare Act, the impact to Biocept's pricing is expected to be neutral.
According to Biocept CFO Tim Kennedy, sales and volume during the quarter were affected negatively by this summer's hurricanes in Texas and Florida, as well as the earthquake in Mexico City. The quarter also was shorter than the previous year's third quarter by two sales days. These factors reduced volume by about 15 to 20 percent from what would have otherwise been expected, the company said.
Its R&D expenses for Q3 2017 rose to $856,698 from $600,613 a year ago, due primarily to a higher headcount, greater consumption of materials, and higher costs associated with research and development activities. The firm's SG&A costs were up about 9 percent at $3.5 million compared to $3.2 million in Q3 2016, reflecting the company's salesforce expansion.
Biocept said that its increased cost of revenues was attributable to an expansion of its laboratory capacity, in turn a result of its sales force expansion, pathology partnership initiative, and investments in upgrading its laboratory information system, equipment, and facilities. As test volumes continue to increase, the company said it expects to leverage its fixed and semi-variable costs, reducing costs per sample and improving gross margins.
The firm's net loss for Q3 was $5.8 million, or $.20 per share, on 29.6 million weighted-average shares outstanding, up from $4.7 million, or $.57 per share, on 8.4 million weighted-average shares outstanding in the same period of 2016.
Biocept finished the quarter with $5.9 million in cash and cash equivalents, and Nall said on the call that the company is "evaluating numerous alternatives" for additional funding.