This article has been updated to include comments from T2's earnings call.
NEW YORK (GenomeWeb) – T2 Biosystems reported after the close of the market today a more-than-five-fold increase in its first quarter revenues in part due to increased demand for its T2Candida sepsis test.
For the three-month period ended March 31, T2's revenues climbed to $1.1 million from $188,000 in the year-ago quarter, in line with revised revenue guidance the company provided last month and matching analysts' consensus estimate. Product revenue accounted for $437,000 of the total first quarter revenues, compared to essentially no product revenues last year, with the remaining $659,000 coming from research revenue compared to $178,000 a year ago.
At the end of 2015, T2 had said that it expected Q1 revenues would exceed the roughly $1 million, with Wall Street predicting revenues of $1.5 million. However, in April the company said that Q1 revenues would likely match Q4 revenues due to a lower-than-expected number of customers adopting the T2Candida test.
During a conference call held to discuss the Q1 results, T2 President and CEO John McDonough said that the company continues to anticipate closing between 45 and 65 lab and hospital commitments for T2Candida in 2016, which would bring its total customer base to 75 to 95 hospitals by year end.
T2's first quarter net loss increased to $13.4 million, or $.55 a share, versus $10.6 million, or $.53 a share in the same period a year earlier, missing analysts' average expected loss per share of $.54.
R&D spending in the quarter was up about 12 percent to $6.6 million from $5.9 million, reflecting expenses associated with development of its bacterial sepsis test T2Bacteria, which is slated for launch in 2017, as well as earlier-stage tests based on its T2MR magnetic resonance diagnostic technology.
Among the planned tests based on the T2MR technology is the hemostasis profiling panel T2Hemostat. McDonough said that T2 is in discussions with the US Food and Drug Administration about how to design a pivotal study for the test, which could begin in the third quarter, but indicated that there is a strong possibility the company could pursue CE marking and a European launch before getting US regulatory approval.
Meanwhile, SG&A costs jumped nearly 38 percent to $6.2 million from $4.5 million as the company expanded its sales force. McDonough noted that T2 is still aiming to have 20 sales reps by the end of the second quarter, and would add more "as we see the need" over the remainder of the year.
At the end of the first quarter, T2 had cash and cash equivalents totaling $59.5 million. The company noted it has an additional $10 million available through an equipment lease credit line. McDonough said that these cash reserves are sufficient to carry T2 through the launch of T2Bacteria and that the company has no plans to raise additional capital in the short- to midterm.
Looking ahead, second quarter revenues are expected to exceed those in the first quarter due to additional hospital accounts for T2Candida coming on line and increased use of the panel at institutions that are already testing patients.