Fluidigm said this week that single-cell genomics applications and production genotyping continued to serve as the primary growth drivers for the company, helping first-quarter revenues spike 33 percent year over year.
As in recent quarters, about 40 percent of Fluidigm's revenues were driven by single-cell genomics applications, an area that the company has embraced as its sweet spot in the last few years, CEO Gajus Worthington said during a conference call yesterday following the release of Fluidigm's financial results.
"This revenue estimate includes our C1 Single-Cell Autoprep System sales and associated consumables, as well as BioMark HD and associated consumables motivated by single-cell gene expression," Worthington said during the call.
"This is a fantastic result, but I want to remind everyone that we had no revenues from the C1 in Q1 of 2012, as we launched the system in late Q2 of 2012," he added. "So we don't expect this kind of growth throughout the year."
Fluidigm first disclosed in May 2012 that it was developing the C1 system, which takes cells from suspension and uses Fluidigm's microfluidics technology to automatically separate them into individual chambers where each can be treated and imaged. The system then automatically processes each cell in parallel through multiple steps to produce nucleic acid samples that can be analyzed directly on the BioMark or BioMark HD, highly parallel PCR-based gene expression analysis platforms (PCR Insider, 5/17/2012).
Since that time, the company has placed systems with multiple early access users working on a variety of applications.
"We expect 2013 to be a watershed year for single-cell genomics," Worthington said. "This is based on multiple indications from the market, not the least of which is our substantial growth in the sector wherein our revenues nearly doubled year on year."
External indicators also support this expectation, Worthington said. These indicators range from "key opinion leader endorsements at high-profile scientific meetings; to the announcement of the third single-cell genomics center at the Sanger Institute in the UK; to a growing publication base supporting high-impact science," Worthington said.
Fluidigm's BioMark products also contributed significantly to its single-cell genomics revenue base and to overall growth. Approximately 70 percent of BioMark HD units sold in the quarter were motivated by single-cell gene expression, Worthington said, with about 30 percent of C1 sales bundled with a BioMark or BioMark HD.
"With our full workflow solution with single-cell genomics, we have come to market with a solution that fills an unmet need at the right place and at the right time," Worthington said. "Our early C1 adopters have been very actively ramping up their single-cell research over the past few months. Some of our customers have begun to publicly share their data. And we know of several publications in the pipeline and the science behind them is fantastic."
Production genomics, which describes very high-throughput, repeat testing applications usually in industrial or applied settings, also contributed significantly to Fluidigm's year-over-year growth.
Fluidigm's production genomics customers include clinical labs, agbio seed companies, fisheries, and biorepositories. This business is predominantly based on SNP genotyping, Worthington said, but the company also has garnered production customers for gene expression with the BioMark system and targeted resequencing sample preparation with the Access Array system.
"We experienced increased adoption by clinical reference and [laboratory-develop test] laboratories in oncology, reproductive health, immunology, and complex human diseases," Worthington said. He also underscored the sale of multiple Access Array systems in Q1 to Germany's DKMS, or the German Bone Marrow Donor Database Life Science Lab, a large bone marrow registry screening lab.
"We are happy to report that the DKMS has scaled its NGS-based HLA typing operation to thousands of samples per week, which wouldn't have been practical without the workflow, cost, and performance benefits of the Access Array," Worthington said.
Another emerging important production genomics application for Fluidigm is sample fingerprinting in a biorepository or core lab setting.
To further enhance its offerings in this area, the company expects later this year to launch a 96-SNP panel based on its SNPType chemistry to assess sample quality and identity.
This panel, Worthington noted, was developed in collaboration with Andy Brooks from the Rutgers University Cell and DNA Repository, a partnership covered earlier this month by PCR Insider sister newsletter BioArray News.
During the quarter, Fluidigm received $3.1 million in cash for its minority equity interest in Verinata Health, which was acquired by Illumina for $450 million in February.
Excluding this cash influx, Fluidigm was essentially cash flow neutral for the first time in any quarter in its history, Worthington noted during the call.
"For the first time in the company’s history I am simply thrilled to point out that we generated a little cash, even excluding the effects of the sale of our Verinata investment," he said. "Q1 has always been our toughest quarter of the year, as evidenced by our seasonal pattern. So I am simply elated that Fluidigm was able to generate cash in Q1 of 2013."
Worthington added that it was "a major milestone" for the company that occurred "substantially earlier" than it expected. However, he noted that the company does not expect this trend to continue throughout the year, since in Q1 the company "enjoyed the polar opposite of a perfect storm, with overachievement in revenues, margins, and cash collection combined with better-than-expected operating expense and spending on working capital."
Overall, Fluidigm netted total revenues of $14.5 million for the period ended March 31, compared to $10.9 million in the first quarter of 2012. This included instrument revenues of $7.9 million, a 34 percent increase over the $5.9 million it logged in Q1 2012 — a spike driven largely by sales of the C1.
Meantime, the company tallied consumables revenues of $6.3 million, up 31 percent from $4.9 million in Q1 2012 and driven primarily by high-throughput production genomics customers.
Fluidigm posted a net loss in Q1 of $3.6 million, or $.14 per share, compared to a net loss of $6.7 million, or $.33 per share, in the first quarter of 2012. R&D expenses totaled $4.2 million in the first quarter, a slight decrease from $4.3 million in the comparable period last year. Meantime, SG&A costs rose 18 percent to $11.1 million from $9.4 million in Q1 2012.
Fluidigm finished the year with approximately $86.9 million in cash, cash equivalents, and investments.
The company is maintaining its 2013 total revenue growth guidance of 22 percent to 26 percent over 2012. Historically, Fluidigm’s product revenues have tended to be lowest in the first quarter of the year and highest in the fourth quarter of the year. This trend is expected to continue in 2013.
"With respect to macro funding considerations, our market strategy is playing out well and like we expected it to," Worthington said. "Single-cell genomics continues to grow substantially despite some concerns about sequestration; and the other key area of focus for Fluidigm, production genomics, derives its funding from industrial, not academic, funding sources. Thus, we are reiterating our strong revenue growth guidance."