NEW YORK – Oncocyte said after the close of the market on Monday that it booked $1.1 million in revenues in the first quarter compared to $16,000 a year ago driven by sales of its DetermaRx lung cancer recurrence risk test and growth in its pharma services business.
Oncocyte's Q1 revenues exceeded analysts' consensus estimate of $830,000. The company said that it performed a total of 236 tests in Q1, down slightly from 238 tests in the fourth quarter of 2020, but noted that it saw steady month-over-month test volume growth despite the pandemic surge in January and February.
During the quarter, the Irvine, California-based molecular diagnostics firm announced an agreement with MultiPlan Network, expanding access to DetermaRx to an additional 60 million lives at a negotiated price in line with US Centers for Medicare and Medicaid Services pricing.
On a call discussing the firm's quarterly results, Oncocyte CEO Ron Andrews said that the firm's agreement with Shanghai-based Burning Rock to distribute DetermaRx in China is "progressing as planned."
"Our continued progress to complete full onboarding and validation in late Q3 leaves us on track for $4 million in booked revenue from Burning Rock in 2021. And it's just the beginning of our efforts to tap into the world's largest early-stage lung cancer market," Andrews said.
With DetermaRx in the clinic, Oncocyte is now working to launch its second assay, DetermaIO, a gene expression test that assesses the tumor microenvironment to predict immunotherapy response. DetermaIO is currently a research-use-only tool for pharmaceutical and academic clinical trials, but Oncocyte expects to make it available as a clinical test in the second half of this year.
Andrews highlighted the company's recent presentation at the annual meeting of the American Association for Cancer Research, which assessed the ability of DetermaIO to predict immunotherapy response in bladder cancer, the third tumor type the firm has studied so far.
"In a very short period of time we have built a compelling foundation of data, demonstrating applicability of this test across all four [FDA]-approved immunotherapies … and across four different indications — lung, breast, bladder, and kidney cancers — which together suggests a pan-cancer immunotherapy opportunity," Andrews said.
As this data has begun to add up, the company has now initiated pilots with four pharma firms for DetermaIO, he added. These studies are assessing the test using samples from failed drug trials, with the potential for companion diagnostic development and resurrection of these indications if the results are positive.
To complement DetermaIO, Oncocyte also anticipates launching DetermaTx in the second half of 2021 as a clinical test to assess the mutational status of a tumor to help identify the appropriate targeted therapy.
During the first quarter, the firm also acquired Chronix Biomedical, positioning itself to enter the blood-based cancer monitoring market with tests for immunotherapy-response monitoring and transplant-rejection testing.
Oncocyte shaved its Q1 net loss to $3.9 million, or $.05 per share, from a loss of $7.7 million, or $.13 per share, a year ago. On average, analysts had expected a loss per share of $.10.
The company's Q1 R&D spending jumped 55 percent to $3.4 million from $2.2 million a year ago, primarily due to increased investment in DetermaIO, personnel, and related expenses.
Its SG&A expenses grew 16 percent to $7.1 million from $6.1 million, primarily due to personnel and related expenses for ramping up sales and marketing activities for DetermaRx's commercialization as well as market development investments to prepare for the launch of new products later this year.
Oncocyte finished the quarter with $58.9 million in cash and cash equivalents and $887,000 in marketable equitable securities