NEW YORK – T2 Biosystems reported after the close of the market on Thursday that its fourth quarter revenues rose 152 percent year over year.
For the three months ended Dec. 31, 2020, the company posted revenues of $7.8 million compared to $3.1 million in Q4 2019, in line with its preliminary revenues released in January but missing analysts' average estimate for revenues of $8.0 million.
Product revenues rose 273 percent year over year to $5.8 million from $1.6 million. The firm booked no research revenues in Q4 compared to $294,000 in the prior-year quarter, and its grant contribution revenue rose 67 percent year over year to $2 million from $1.2 million.
"We made considerable progress across the business during 2020, including building strong demand for our products," T2 Biosystems CEO John Sperzel said in a statement. "Heading into 2021, we will continue to focus on three corporate priorities – accelerating our commercialization, improving our operations, and advancing our product pipeline – which we believe positions the company for sustained growth and long-term success."
Lexington, Massachusetts-based T2 Biosystems sold 57 T2Dx instruments in 2020, including 47 in the US, more than doubling its US installed base. It sold 21 T2Dx instruments in the fourth quarter including 19 in the US.
The firm said that it increased sepsis test utilization in the US by 72 percent, resulting in a fourth quarter annualized run rate of approximately $86,000 per legacy sepsis instrument. It also achieved COVID test utilization growth in the US, resulting in a fourth quarter annualized run rate of approximately $265,000 per instrument sold in 2020, the firm said.
T2 Bio added that its T2SARS-CoV-2 panel can detect SARS-CoV-2 virus variants including those identified in the United Kingdom, South Africa, and Brazil, along with 99.99 percent of all currently identified variants, based on sequence alignments and in silico analysis.
The company's SARS-CoV-2 tests brought in 27 percent of its total revenue in 2020, Sperzel said on a conference call to discuss the firm's financial results.
Looking at 2021, T2 Biosystems anticipates it will book 70 percent of its COVID-19 testing revenues in the first half and the rest in the second half of the year, he said.
Additionally, this year T2 Biosystems expects to convert recent customers to sepsis testing on its T2Dx instruments, and move some of them away from the SARS-CoV-2 tests that they are currently running on the instrument. That strategy is aligned with the company's "expectation that COVID-19 testing in US hospitals will decline throughout the year," Sperzel said.
He added that T2 Biosystems continues to prioritize initiatives under a milestone-based product development contract awarded in 2019 by the US Department of Health and Human Services' Biomedical Advanced Research and Development Authority.
Under the contract, T2 Biosystems is developing three products: a next-generation instrument, a comprehensive sepsis panel, and a biothreat panel. The company's next-generation instrument would be fully automated and enable random access similar to its current T2Dx instrument. However, the device would also provide faster turnaround times at a lower cost per reportable result, and detect an increased number of pathogens from a whole blood sample, Sperzel said.
T2 Bio reported its Q4 net loss narrowed to $9.9 million, or $.07 per share, from a net loss of $14.0 million, or $.29 per share, in Q4 2019, which matched the consensus Wall Street estimate for a net loss of $.07 per share.
Its Q4 2020 R&D expenses decreased 7 percent to $4.0 million from $4.3 million in 2019, and its SG&A expenses fell 39 percent year over year to $4.6 million from $7.5 million.
For full-year 2020, T2 Bio reported revenues of $18.1 million, an increase of 118 percent year over year from $8.3 million, and narrowly missed on analysts' average estimate for revenues of $18.2 million. Product revenues rose 121 percent year over year to $11.7 million from $5.3 million.
The firm reported that for full-year 2020 its net loss narrowed to $46.8 million, or $.39 per share, from $59.0 million, or $1.30 per share, in 2019, which beat analysts' average estimate for a loss per share of $.40.
T2 Bio's 2020 R&D expenses increased 4 percent to $16.9 million from $16.3 million in 2019, and its SG&A expenses decreased 22 percent to $21.3 million from $27.3 million.
The company had cash and cash equivalents of $16.8 million and marketable securities of $25.4 million as of the end of December.
T2 Bio said that for full-year 2021, it expects revenues between $24.0 million and $26.0 million including product revenue of between $16.0 million and $18.0 million, and research and contribution revenue of $8 million. The firm said it expects to close at least 30 T2Dx instrument contracts in 2021.
The firm also announced that it has appointed Aparna Ahuja as its chief medical officer to drive clinical programs and raise company visibility within the medical laboratory community. She recently joined the firm after serving as worldwide vice president, medical affairs at Becton Dickinson.
In a research note on Thursday, BTIG analyst Mark Massaro said that T2 Bio's 2021 guide for T2Dx placements was a big surprise and far below the investment bank's estimates for 80 placements this year.
Shares of T2 Bio were down more than 15 percent to $1.65 in early Friday morning trading on the Nasdaq.