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Oxford Immunotec Q1 Revenues Jump 27 Percent

NEW YORK (360Dx) – Oxford Immunotec reported today a 27 percent year-over-year increase in first quarter revenues primarily on growth in tuberculosis testing in all geographies.

For the three months ended March 31, 2019, Oxford Immunotec logged $14.8 million in total revenues compared to $11.7 million in the year-ago period. On a constant-currency basis, Q1 revenues increased 39 percent year over year.

On a conference call following release of the company's earnings, Oxford Immunotec CEO Peter Wrighton-Smith noted that revenues came in above the company's implied guidance range of $13.4 million to $14.1 million.

"We're really pleased to see such a strong start to the year and an acceleration in growth," Wrighton-Smith said. "In addition to a renewed focus on driving revenue growth as a pure-play kits business, we're also concentrating on driving the company's profitability metrics. … We continue to repurpose the company's spending around being a pure-play kit company."

Product revenues soared 37 percent to $13.8 million from $10.1 million a year ago, while service revenues declined 41 percent to $948,000 from $1.6 million. The decrease in service revenue resulted from the company's previously announced exit from the blood donor screening business, partially offset by growth in tuberculosis testing volumes at the company's UK Oxford Diagnostic Laboratories.

In November, Oxford Immunotec closed the sale of its Memphis, Tennessee-based US laboratory business to Quest Diagnostics for $170 million in cash, a deal originally announced in September.

As such, the Oxford, UK-based company noted, total revenue and product revenue for the first quarter of 2019 and 2018 are not fully comparable. Revenues for Q1 2018 included sales to the former US lab business, while sales for Q1 2019 included revenue from T-SPOT.TB tuberculosis test kits and accessories sold to Quest after Nov. 6 as part of a long-term supply agreement.

Oxford Immunotec slashed its Q1 net loss to $1.5 million, or $.06 per share, from a net loss of $10.3 million, or $.40 per share, a year ago.

The company's Q1 R&D spending was essentially flat year over year at $2.3 million, while SG&A expenses fell 10 percent to $11.5 million from $12.8 million.

Oxford Immunotec finished the quarter with $189.5 million in cash and cash equivalents.

For full-year 2019, the company continues to expect revenue of $69 million to $72 million.

During the earnings call Wrighton-Smith said that the company's first operating priority for 2019 is maximizing the success of its relationship with Quest in the US market, which "significantly increases the reach and competitiveness" of Oxford Immunotec's T.Spot-TB assay for latent tuberculosis in the US.

"Our focus for now remains on bringing the former Oxford Immunotec operation onto the Quest platform." Wrighton-Smith said. "This is a staged process covering IT, phlebotomy access, logistics, and managed care."

"The initial priority has been integrating the Memphis lab operations to Quest's software platform," he added. "This will allow physicians to order T.Spot-TB directly from their EMR or Quest ordering interface, just like any other Quest test, and receive results and invoices the way they're used to. Quest has made great progress on this and has just launched electronic ordering of T.Spot TB. This opens up access to Quest patient service centers, managed care plans, and logistics capabilities."

Wrighton-Smith also noted that in Q1 the company signed a manufacturing and distribution agreement in Russia with Generium Pharmaceutical, adding to its existing distribution partnership with Russia's PharmLine.

"Generium has a strong presence in the TB screening market and we look forward to working with them and PharmLine to drive further growth of T.Spot TB in the Russian market," Wrighton-Smith said.

In afternoon trading on the Nasdaq, shares of Oxford Immunotec were down a fraction of 1 percent at $16.16.