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T2 Biosystems Posts Q2 Revenues Decline But Big Jump in Product Sales

NEW YORK (GenomeWeb) – T2 Biosystems reported after the close of the market Thursday a 3 percent drop in overall revenues for the second quarter but a big increase in product sales year over year.

The Lexington, Massachusetts-based diagnostics firm brought in total revenues of $956,000 for the three months ended June 30 versus $990,000 in Q2 2016. The drop was the result of a sharp decline in research revenue to $221,000 from $839,000 year over year, which the firm attributed to lower revenue recognition from its codevelopment agreement with Canon US Life Sciences.

However, T2's product sales jumped to $735,000 from $151,000 year over year. On a sequential basis, product sales were up nearly 17 percent versus the firm's projected 10 percent growth. The firm, which makes the T2Candida and T2Bacteria Panels that run on its T2Dx instrument, said that during the quarter it secured contracts with three hospitals in the US and two in Europe, and also inked four contracts with hospitals in the US to use of the T2Bacteria Panel under a research-use-only program.

It also obtained the CE mark for the T2Bacteria Panel allowing for the sale and distribution of the test in Europe and other countries that accept the CE mark. T2 Biosystems CEO John McDonough noted in a statement that the company expects to file for US Food and Drug Administration clearance of the T2Bacteria panel in the next four to six weeks and is targeting "a potential FDA clearance by the end of 2017."

T2 posted a net loss of $15.5 million, or $.50 per share for the quarter, compared to a loss of $14.0 million, or $.58 per share, for Q2 2016. The number of shares used to calculate the loss per share figure increased to approximately 30.7 million shares from 24.3 million shares in the second quarter of 2016.

The firm's R&D costs in Q2 2017 increased 11 percent to $7.1 million from $6.4 million, while its SG&A spending dipped around 5 percent to $5.8 million from $6.1 million.

T2 finished the quarter with $46.1 million in cash and cash equivalents.

The company said it expects to report product revenue growth of at least 20 percent sequentially in the third quarter.