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Biocept Q3 Revenues Spike Sharply With COVID-19 Testing Dwarfing Core Cancer Tests

NEW YORK – Biocept reported after the close of the market on Thursday that its third quarter revenues more than quadrupled year over year driven by its current offering of molecular COVID-19 testing services.

For the three months ended Sept. 30, the San Diego-based liquid biopsy company posted $6.6 million in revenues compared to $1.5 million in Q3 2019.

These revenues included $6.4 million from commercial testing, of which $5.7 million was attributable to the company's temporary provision of COVID-19 testing. The remaining $700,000 represents a 50 percent drop from the $1.4 million in commercial oncology testing revenue Biocept recorded in the prior year's quarter.

The firm also took in $47,000 in development services test revenue — a 24 percent increase from the $38,000 seen in Q3 2019 — and $154,000 in revenue for distributed products, which include Biocept's Target Selector RUO kits, CEE-Sure blood collection tubes, an approximately 161 percent increase over $59,000 earned in the same period last year.

Biocept said it accessioned 52,993 total samples during the third quarter of 2020, compared with 1,429 total samples during the third quarter of 2019. Of these, 52,773 were billable samples compared with 1,189 billable samples in the same period last year. The company attributed the increase in total and billable samples to its COVID-19 testing business.

The firm announced this week that it has received more than 100,000 samples for COVID-19 testing thus far, a service it performs using Thermo Fisher Scientific's TaqPath SARS-CoV-2 assay. According to Biocept it was reimbursed for COVID-19 testing at about $120 per test during Q3.

This August, the company announced it had created its own COVID-19 specimen collection kits and was working under a development agreement with Aegea Biotechnologies, using the Switch-Blocker technology co-owned by the two firms to develop a novel SARS-CoV-2 assay.

On a call discussing the company's quarterly financial results, Biocept President and CEO Michael Nall said that the sample collection kit is on track for validation by the end of 2020 despite delays due to backorders on the equipment needed to produce the number of kits the company will require for its expected test volumes, as well as a delay by the third-party CRO it is working with to confirm the effectiveness of the viral killing properties used in its sample tubes. Nall added that progress is also being made under the Aegea agreement. He stressed, however, that while Biocept expects COVID-19 testing to be an important part of its business until the pandemic subsides, the firm's long-term strategy remains oncology-focused.

During the call Nall said that Biocept experienced "some of the recovery we anticipated in our commercial oncology and development testing volume compared with the second quarter."

That said, he added "like many other molecular diagnostic labs, our commercial testing volume has not returned to [pre-pandemic] levels owing to lower patient visits to physician offices." With a resurgence in COVID cases currently occurring across the US, the company may see an extended impact on its oncology volume and associated revenue, Nall said.

Biocept's Q3 net loss attributable to common shareholders dropped to $4.9 million, or $0.43 per share, from $5.7 million, or $2.47 per share, in the same quarter last year. Reflecting the 1-for-10 reverse stock split it completed in September, Biocept used approximately 11.3 million weighted-average shares outstanding to calculate its per-share loss in the recently completed quarter compared to about 2.3 million weighted-average shares outstanding in the same period of 2019.

R&D costs for the firm dropped about 8 percent to $1.1 million from $1.2 million a year ago, primarily due to a reduction in laboratory allocated costs. Its SG&A spending rose almost 38 percent to $4.4 million from $3.2 million, with the increase primarily due to legal and investor relations expenses, as well as headcount additions to handle COVID-19 related activities.

Biocept exited Q3 2020 with $16.9 million in cash and cash equivalents.