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GenMark Diagnostics Q1 Revenues Grow 80 Percent

NEW YORK (GenomeWeb) – GenMark Diagnostics reported after the close of the market on Monday that its first quarter revenues rose 80 percent, driven in part by continued sales growth of its ePlex molecular diagnostics analyzer and by its SARS-CoV-2 test.

The company also announced interim CEO Scott Mendel had been appointed President and CEO.

For the three months ended March 31, 2020 the molecular diagnostics firm reported revenues of $38.7 million, up from $21.5 million a year ago, and exceeding the consensus Wall Street estimate of $29.8 million. The Q1 2020 result matches the preliminary figure provided by the firm in early April.

In Q1, the firm booked ePlex revenues of $34.3 million, growing 119 percent compared to the prior-year period's $15.7 million. The company placed 54 net new ePlex analyzers, expanding the global installed base to 581 placements and growing its installed base by 48 percent compared to the prior-year period. Average annuity per analyzer reached approximately $214,000, a 29 percent increase over the first quarter of 2019.

Mendel noted in a conference call to discuss the earnings that the SARS-CoV-2 test was a key driver in 80 percent of the instrument placements in the first quarter. The SARS-CoV-2 test contributed 5 percent to overall ePlex revenue, Mendel said.

In March, the company received Emergency Use Authorization from the US Food and Drug Administration for its ePlex SARS-CoV-2 test. GenMark was also granted up to $749,000 from the US Department of Health and Human Services to develop and pursue an EUA for a diagnostic panel incorporating a new SARS-CoV-2 viral target in its ePlex Respiratory Pathogen panel.

Mendel said the new respiratory panel, which will detect five coronavirus strains, is expected to launch in June. As customers decide to move from the single-target SARS-CoV-2 test to the expanded respiratory panel, Mendel said testing capacity could be freed up by 10 to 20 percent, since the company will produce less single-target tests. Because the new respiratory panel will help hospitals eliminate costs related to running multiple tests and will increase value, Mendel said the test will be "at or above" current pricing levels.

The company is making progress on the development of a gastrointestinal panel, Mendel noted, but said the focus was on tests already on the market.

The company's net loss decreased to $7 million, or $.12 per share, from $12.1 million, or $.21 per share, a year ago, beating analysts' average estimate for a loss of $.14 per share.

GenMark's R&D costs declined slightly to $6.1 million from $6.3 million in Q1 2019, and its SG&A costs rose 45 percent to $15.1 million from $10.4 million.

The firm ended the quarter with $26.3 million in cash and cash equivalents and $20.8 million in short-term marketable securities.

For full-year 2020, GenMark expects total revenue to be in the range of $120 to $130 million. It previously said it expected revenue to reach $112 million to $122 million for the full year. The increase is based on expected volumes from ePlex systems placed in 2020, as well as the demand for SARS-CoV-2 and respiratory panel tests, said CFO Johnny Ek.

It anticipates that global ePlex placements will be in the range of 175 to 200 net new analyzers with an annuity per analyzer of $130,000 to $135,000.