GenMark Diagnostics this week reported revenue growth of 162 percent for its first quarter since going public in the US.
The company, which was based in London and known as Osmetech before going public in the US at the end of May, also announced that it is seeking a new CEO. Jon Faiz Kayyem, who previously served in that role, is now chief scientific officer. Christopher Gleeson, chairman of the firm, will serve as CEO on an interim basis.
The Pasadena, Calif.-based molecular diagnostics microarray firm brought in total revenues of $650,712 for the three months ended June 30, compared to $248,568 for the second quarter of 2009.
Company officials attributed the spike in sales to increased demand for GenMark's US Food and Drug Administration-cleared tests for cystic fibrosis, warfarin sensitivity, and thrombophilia risk. All three assays run on the company's eSensor XT-8 System, which supports up to 24 test cartridges, each of which can detect up to 72 distinct biomarkers in a single sample.
Kayyem said during the firm's earnings call that the cystic fibrosis carrier detection assay is its "number one product," though "all three FDA-cleared products are performing well."
While Kayyem did not break out sales numbers for each assay, he said the thrombophilia risk assay experienced "excellent uptake" in the market during the quarter, while demand for the warfarin sensitivity test is expected to increase as GenMark's platform is being used in several studies, including one led by Iverson Genetics.
Kayyem also said that the firm is developing a respiratory viral panel, which it expects will detect 21 different upper respiratory viruses. Studies on that test will be conducted during the fourth quarter of this year.
GenMark has also completed development of a genotyping test for cytochrome P450 2C19, which is intended to assess drug metabolism in patients. Kayyem said that GenMark is currently using this test to assess population frequency of different genotypes thought to be associated with poor Plavix response.
The company is in discussions regarding appropriate regulatory pathway in order to bring these tests to market as in vitro diagnostics in the US, he added.
Kayyem said that GenMark is also developing a test for KRAS mutations that is designed to aid in treatment of colorectal and other cancers. He said the test should be developed by the end of this year and will be in beta trials in the first half of 2011. GenMark, meantime, is "evaluating more opportunities in the infectious disease space," Kayyem said. He did not elaborate.
While GenMark seeks to expand its test menu, it is developing a next-generation version of its eSensor system. Kayyem said that the new instrument will be developed in conjunction with an undisclosed external partner, and GenMark expects to ink a long-term agreement by the end of this year.
GenMark saw demand for the current generation of the eSensor during the quarter. Gleeson said in a statement that "placements of our XT-8 system exceeded our expectations and we are extremely pleased with the productivity of our new and still growing direct sales force."
Gleeson assumed the role of CEO this week on an interim basis as GenMark seeks its new CEO. Kayyem, who previously held that role but now serves as CSO, will oversee all activities associated with menu expansion and platform development.
"We have met with key regulatory officials and advisors, reviewed our test pipeline opportunities, and refined our strategy," Gleeson said during the call. "It's become clear to the board that we needed to bring in a higher-level and more qualified approach to our product development and scientific activities."
He said that the board believes that Kayyem, the founder of the company and the inventor of its technology, was best suited to head these efforts. Gleeson said that the search for the firm's new CEO could take up to 12 months.
GenMark's net loss widened to $5.1 million from $4.3 million for the second quarter last year.
Its R&D expenses increased 21 percent to $1.7 million from $1.4 million, while its SG&A spending jumped 39 percent to $3.2 million from $2.3 million.
GenMark's US IPO and name change were disclosed in a prospectus Osmetech filed with the US Securities and Exchange Commission in March (BAN 3/23/10). That plan also included moving the firm's headquarters from the UK to Pasadena, Calif. Gleeson said this week that the move was necessary to reduce costs and build a uniform corporate culture within the firm.
GenMark finished the quarter with $29.6 million in cash and cash equivalents.