On August 10, 2022 Oncocyte Corporation (Nasdaq: OCX), a precision diagnostics company with the mission to improve patient outcomes by providing personalized insights that inform critical decisions throughout the patient care journey, reported that financial results for the second quarter 2022, ended June 30, 2022 (Press release, Oncocyte, AUG 10, 2022, View Source [SID1234618045]).
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Second Quarter and Recent Highlights:
Recent rightsizing of organization to match new program priorities is expected to reduce headcount carrying costs by over $4.5 million annually and, in combination with reprioritization cost reduction and anticipated strategic activities, annualized operating costs are expected to be reduced by approximately $12 million in 2023 as compared to 2022.
Reported total revenue of $2.1 million in the second quarter of 2022, compared with $2.0 million in the second quarter of 2021.
Received $1.0 million milestone payment from the final delivery of DetermaRx to Burning Rock, our Chinese partner.
Grew DetermaRx sample volume by 66% compared to second quarter of 2021 and increased onboarded physician base by 82% as compared to the same period in 2021.
Launched our CLIA validated laboratory test for our newly branded VitaGraft Liver Transplant Monitoring, a donor-derived cell-free DNA (dd-cfDNA) test.
Submitted VitaGraft Liver and VitaGraft Kidney for CMS reimbursement.
Clinical Partners presented five abstracts at ASCO (Free ASCO Whitepaper) and AACR (Free AACR Whitepaper) expanding the evidence supporting DetermaIO as clinically relevant to decision making in six different cancer types including:
Independent, prospective randomized clinical trial (RCT) evidence that DetermaIO can identify responders and expand the market for immune checkpoint inhibitor (ICI) therapy in colorectal cancer.
Phase II independent blinded clinical trial evidence that DetermaIO can inform the use of pembrolizumab therapy (Keytruda) in the neoadjuvant treatment of triple negative breast cancer, expanding upon prior reported RCT data with atezolizumab.
Closed an underwritten offering of $32.8 million in net proceeds of common stock and warrants, and a preferred stock offering of $4.9 million in net proceeds, to strengthen the balance sheet and further support our product portfolio.
"Our recent reprioritization efforts have led to a rightsizing of our employee base to better match the resourcing required to deliver DetermaIO, DetermaCNI and VitaGraft to the market. The expected program cost reductions combined with the reduction in headcount and planned monetization of assets through strategic activities are anticipated to result in a decrease of approximately $12 million in annualized operating expenses year over year, extending our cash runway into 2024," said Ron Andrews, Chief Executive Officer of Oncocyte. "We continued to make solid progress in the second quarter, delivering 66% year over year growth in DetermaRx sample volumes and successfully onboarding new physicians and accounts. We also successfully completed our CLIA lab test validation of our VitaGraft product line and submitted both Liver and Kidney for CMS reimbursement."
Continuing, Mr Andrews commented, "Looking ahead, we are excited by the response to the anticipated launch of our VitaGraft Liver test and expect our first samples from a high-profile liver transplant center by the end of August. We also remain on track to submit our dossier for DetermaIO reimbursement this fall. Despite the continued market headwinds, we believe that Oncocyte has an incredibly bright future in front of us as the product development efforts from the past few years are expected to result in new product launches of high value, reimbursed products over the next four to six quarters. I would also like to recognize the promotion of Anish John to CFO and Gisela Paulsen to President and COO. These are well-deserved promotions for two executives that have been instrumental in reshaping our priorities and helping find ways to reduce our burn while still accomplishing our mission. We are now aligned around key areas where our skill sets can best serve Oncocyte’s future. I appreciate the continued support of our shareholders and look forward to updating you as we work to deliver on the key product milestones throughout the second half of 2022."
Second Quarter 2022 Financial Results
Total revenue was $2.1 million for the second quarter of 2022, compared to $1.4 million for the prior quarter. Second quarter revenues associated with DetermaRx were $0.8 million, down $0.2 million sequentially, and up $0.2 million year over year. Operating expenses for the second quarter 2022 were $8.2 million, compared to $13.2 million, a decrease of $5.0 million from the same period in the prior year. Research and Development expense for the second quarter 2022 was $5.6 million, an increase of $3.0 million from the same period a year ago. The increase in R&D expense was due to full integration of the Chronix R&D team, the growth and enrolment of our clinical trials, and added headcount related to the buildout of our IVD product development capabilities. General and Administrative expense for the second quarter of 2022 was $5.5 million, a decrease of $2.4 million for the same period in 2021, primarily due to one-time acquisition related costs related Chronix Biomedical acquisition in the same period in the prior year. Sales and Marketing expense in the quarter was $3.5 million, an increase of $0.8 million year over year, primarily attributable to an increase in headcount and continued ramp in sales and marketing activities related to the transplant business, as well as support the commercialization efforts within oncology.
Net loss was $8.3 million for the second quarter of 2022 and net loss per share was $0.07 on a weighted-average basic and diluted share count of 113.0 million, compared to a net loss of $10.5 million and a net loss per share of $0.12 on a weighted-average basic and diluted share count of 89.8 million in the same period of the prior year.
Cash, cash equivalents, restricted cash and marketable securities were $47.1 million as of June 30, 2022.
Webcast and Conference Call Information
Oncocyte will host a conference call to discuss the second quarter 2022 financial results after market close on Wednesday, August 10, 2022 at 1:30 p.m. Pacific Time / 4:30 p.m. Eastern Time. The conference call can be accessed live over the phone (877) 407-9716 for U.S. callers or (201) 493-6779 for international callers, using conference ID: 13731553. The live webinar can be accessed at View Source