NEW YORK — ProPhase Labs on Friday morning posted a 153 percent year-over-year increase in second quarter revenues.
For the three-month period ended June 30, ProPhase's revenues increased to $9.1 million from $3.6 million the year before. Driving the revenue increase was $7.5 million generated by the company's new diagnostic services business, which performs COVID-19 and other infectious disease testing. This was offset by a $2.0 million decrease in orders from the firm's consumer products business.
During the quarter, ProPhase formed two wholly owned subsidiaries, ProPhase Precision Medicine, which will focus on genomic testing technologies, and ProPhase Global Healthcare, which will expand the firm's SARS-CoV-2 testing to other countries and pursue other healthcare initiatives.
ProPhase CEO Ted Karkus said in a statement that ProPhase processed over 8,000 COVID-19 tests in the first week of August and that he expects continued growth in this area for the remainder of the year as new virus variants drive a new wave of infections.
"While we expect to grow our COVID-19 testing revenues as a result of this new wave, our long-term focus now also includes the development of our Precision Medicine subsidiary," he added.
Earlier this week, the company acquired direct-to-consumer genome testing firm Nebula Genomics for $14.6 million in stock and cash, with the goal of integrating the firm into ProPhase Precision Medicine.
"We believe that we will be able to improve on Nebula's current estimated next 12-month revenues of $9 million given our experience developing, manufacturing, distributing, marketing, and selling other consumer healthcare products," he added.
ProPhase's net loss in the second quarter grew to $1.4 million, or $.09 per share, versus a year-ago net income of $70,000, or $.01 per share.
R&D spending in the second quarter rose 43 percent to $93,000 from $65,000 in the same period a year earlier, while general and administrative costs more than quadrupled to $5.0 million from $1.2 million. The Garden City, New York-based company also recorded an $830,000 expense in Q2 related to its diagnostic operations, which it did not have in the year-ago quarter.
At the end of June, ProPhase had cash and cash equivalents totaling $17.7 million and $18.6 million in marketable debt and equity securities.
In morning trading on the Nasdaq, ProPhase Labs' shares were down almost 8 percent at $5.99.