GenMark Diagnostics will launch at least five new assays by the end of next year and is making progress developing its next-generation NexGen system, which is on track to debut in the second half of 2013, according to its CEO.
Hany Massarany said that the Carlsbad, Calif.-based firm later this month will launch one of the tests, a hepatitis C detection and subtyping assay, which follows a recently completed beta trial.
The test addresses a $50 million market in the US and a $100 million market globally, he said.
Massarany made his comments during the firm's second-quarter earnings call, in which the firm said revenue grew 35 percent year over year.
According to Massarany, GenMark will have one competitor in the HCV-genotyping market, adding that his firm's assay offers "greater ease of use" and a "simpler workflow" compared to its rival.
Massarany did not name the competitor.
Of GenMark's other planned test debuts, several are close to reaching regulatory clearance in the US. The firm is in discussions with the US Food and Drug Administration about a clinical trial to validate its respiratory viral panel, which is designed to detect 21 different upper-respiratory viruses.
GenMark had originally planned to submit the test to FDA in the second quarter and launch it in time for the 2011-2012 flu season, which begins in October, according to the US Centers for Disease Control and Prevention.
Because its competitors have also experienced "substantial delays" in having their flu tests approved, GenMark said it believes FDA has been demanding more data than usual from companies submitting similar molecular tests for 510(k) clearance.
As a result, the company has taken additional steps to prepare its assay for submission, including performing additional tests of uncommon viral subtypes that meet FDA's sample-size requirements.
"FDA is clearly demanding more data from companies submitting tests for 510(k) clearance," said Massarany, without elaborating. As a result, he said GenMark expects to delay by several months submitting its flu test to the agency.
GenMark is also discussing with the FDA the appropriate regulatory pathway for its CYP2C19 genotyping test, which interrogates 11 alleles to identify patients most likely to respond safely to the anticoagulant Plavix (clopidogrel).
Massarany also said that GenMark plans to launch its KRAS test for colorectal cancer in 2012.
Lastly, GenMark is also moving forward with its NexGen system, which will integrate DNA amplification with its eSensor detection technology. GenMark currently runs all of its tests on its eSensor XT-8 instrument. The system relies on the firm's electrochemical-detection technology to locate nucleic acids on a microarray.
Massarany said that the new system will "leverage the electrochemical sensor detection system and integrate the preanalytical step on the same cartridge, including extraction and amplification." However, he noted that the "actual test, how we detect and analyze markers, will be the same."
He said GenMark has not determined its test menu for the NexGen, but said some tests will transition from the XT-8 to the new system while the company develops a "specific menu" for the new platform.
In June, GenMark initiated a public offering of nearly 7.1 million shares of its common stock at $4.25 per share, from which it said it expects to pocket roughly $27.6 million in net proceeds. Last week, Massarany said the firm's NexGen-development program will be a "major beneficiary" of that capital.
Also in the second quarter, total revenues rose 35 percent to $901,000 from $665,000 a year ago, while product revenues grew to $866,000 from $523,000.
In a statement, GenMark attributed the growth to a broader test menu, a "significant" increase in the number of tests sold, and an increase in system placements.
During the quarter, the company placed 17 analyzers, bringing to 37 its 2011 installed base. The company's complete installed base is 119.
Reagent revenues for the three months ended June 30 grew 104 percent year over year to $825,000, GenMark said.
Massarany attributed the revenue growth to an expanded sales team, which currently has a head of sales, eight sales people in the field, and four application specialists.
Massarany said that GenMark intends to grow its sales team in coming quarters, but did not elaborate.
Meantime, R&D spending during the quarter climbed 28 percent to $2.3 million from $1.8 million a year ago, while SG&A spending decreased 8 percent to $1.2 million from $1.3 million.
GenMark's net loss for the quarter increased to $5.6 million from $5.1 million a year ago. GenMark ended the quarter with $43.5 million in cash and cash equivalents.
During the call, Massarany reiterated an earlier projection that GenMark would generate $5.1 million in revenue in 2011. He also said the company expects to record between 15 and 20 system installations for the second half of the year.
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