Full Press Release Details
PROVIDES CORPORATE UPDATE AND REPORTS FOURTH QUARTER AND FULL YEAR 2019 FINANCIAL RESULTS
Commercial Launch of DetermaRxTM in U.S.
Acquisition of Insight Genetics
Research Use Launch of DetermaIOTM After Completion of CLIA Validation
Completion of DetermaDxTM CLIA Validation
call today, March 25, at 4:30 PM EDT
Calif., March 25, 2020 - Oncocyte Corporation (NYSE American: OCX), a molecular diagnostics company with a mission to
provide actionable answers at critical decision points across the cancer care continuum, today reported financial and operating
results for the fourth quarter and year ended December 31, 2019, and provided a corporate update.
started 2020 in a strong position with significant accomplishments that support our strategy to provide actionable answers to
physicians and their patients with the goal of improving outcomes and survival," said Ron Andrews, Chief Executive Officer
of Oncocyte. "I am incredibly proud to have officially transitioned to a commercial stage company with the launch of DetermaRxTM,
the first test for chemotherapy benefit prediction in patients with NSCLC. We have successfully onboarded all 7 of our early access
partners and they have started sending patient samples to our lab and, notably, all physicians have re-ordered the test, a very
important indicator of future utilization. To date, we have identified 7 "high-risk" patients and believe we are already
saving lives by identifying high-risk patients whose treatment course will now include adjuvant chemotherapy instead of surgical
resection alone. This is a remarkable advancement for early NSCLC patients, and we are honored to be able to provide clarity for
these patients and their physicians when making critical decisions after surgery. We look forward to receiving our final coverage
decision from CMS and our continued progress in widespread adoption of this important test."
Andrews continued, "While we are doing our part to minimize the COVID-19 situation in our local communities, we have been
able to continue lab operations in compliance with applicable orders and mandates, and have made great strides in expanding our
suite of important tests with the acquisition of Insight Genetics which includes DetermaIOTM, our immunotherapy response prediction
test. With the recently announced CLIA validation of DetermaIOTM, and the subsequent commercial launch for research use in academic
and biopharma settings, we are poised to provide a valuable and potentially transformative test that we believe, based on recently
published clinical data, outperforms currently available PD-L1 and TMB immunotherapy response prediction tests. We also have continued
our progress in advancing DetermaDxTM , and we were pleased to announce the completion of CLIA validation in early January, consistent
with our previous guidance, and believe we are now are on track with clinical validation and preparations for commercial availability.
Taken together, it is clear that Oncocyte is transforming into a leader for early lung content. While cancer surgeries are being
impacted by the current COVID-19 situation, our discussions with surgeons indicate that these patients will still be getting treated
and surgeries will restart soon, so our focus is on being ready when that moment happens. We look forward to continued execution
across our commercialization and development efforts for a milestone rich 2020."
Corporate Highlights
| o | Acquisition broadens Oncocyte's portfolio of molecular diagnostic tests with addition of DetermaIOTM, a potentially transformative immunotherapy response prediction test demonstrated to outperform PD-L1 and TMB tests | |
| o | Completed CLIA validation of DetermaIOTM, enabling research use launch of the test as a reliable and robust option for academic research and biopharma companies | |
| o | Unlocks significant pharma services opportunity including immunotherapy trials and development of companion diagnostics in lung cancer and other solid tumors | |
| o | Acquisition significantly expands Oncocyte's suite of proprietary tests to manage key decision points potentially across multiple stages and types of cancer, as immunotherapies are currently approved for thirteen solid tumor types |
| o | Announced commercial availability of DetermaRxTM in early January, transforming Oncocyte to a commercial stage company. With multiple sites already onboarded and testing beginning, the commercial team is focused on driving rapid adoption across specialty physicians | |
| o | DetermaRxTM, a CLIA-validated lung cancer treatment stratification test, broadens Oncocyte's capabilities with an extensively validated and published molecular test that enables the identification of early-stage lung cancer patients at high risk for recurrence that are likely to benefit from chemotherapy. OncoCyte acquired the rights to commercialize this test from Razor Genomics in September 2019 | |
| o | Received regulatory approval to begin distribution of DetermaRxTM in Canada | |
| o | Provided an educational grant in support of an accredited Continuing Medical Education (CME) Activity: Advances in Diagnostic Testing: Assessing Your Patient's Risk of Recurrence to Inform Treatment Decisions in Early-Stage NSCLC |
| o | Demonstrates the successful transfer of the research assay to the rigorous environment of Oncocyte's commercial CLIA laboratory | |
| o | Oncocyte has commenced Clinical Validation, which is expected to be completed in Q2 2020. Upon successful completion of Clinical Validation and establishment of performance parameters, Oncocyte will begin preparations for commercial availability |
| Presented data at the CHEST Annual Meeting 2019 on the Immune Response for Nodule Evaluation (IRENE) clinical cohort used for the development and validation of DetermaDxTM. IRENE is one of the largest reported clinical study cohorts in lung nodule management with 62 sites in the U.S. and over 3,000 enrolled patients. IRENE is uniquely representative across clinical settings with a focus on community practices, where most lung cancer patients are diagnosed and treated | ||
| Successfully completed a $7.6 million registered offering of common shares, priced at the market, directly with fundamentally driven, healthcare focused institutional investors. The proceeds strengthened Oncocyte's balance sheet, which will support the strategic commercial launch of the DetermaRxTM lung cancer stratification test and the continued development of DetermaDxTM | ||
| Moved Oncocyte's administrative and executive headquarters to Orange County, California, in January 2020. Plans to construct a clinical diagnostic laboratory and a research laboratory at the new location are being implemented. The move best suited Oncocyte's need to find talented individuals to join its growing team and provides opportunities to engage with oncology patients in the community setting, as well as potentially reduce overall operating costs associated with our CLIA Lab Service |
Quarter and Annual 2019 Financial Highlights
December 31, 2019, Oncocyte had cash, cash equivalents, and marketable securities of $22.5 million as compared to $8.5 million
at December 31, 2018. On March 20, 2020 Oncocyte put in place an at-the-market (ATM) offering for access to additional working
the fourth quarter ended December 31, 2019, Oncocyte reported a net loss of $8.0 million, or $(0.15) per share, as compared to
$4.5 million, or $(0.11) per share, for the fourth quarter ended December 31, 2018.
2019, Oncocyte reported a net loss of $22.4 million, or $(0.44) per share, compared to $15.8 million, or $(0.42) per share for
expenses, as reported, for the three months ended December 31, 201,9 were $7.5 million, an increase of $3.5 million as compared
to the same period in 2018. Operating expenses, as adjusted, for the three months ended December 31, 2019, were $6.7 million,
an increase of $3.1 million as compared to the same period in 2018.
expenses, as reported, for the year ended December 31, 2019, were $22.2 million, an increase of $7.0 million as compared to the
same period 2018. Operating expenses, as adjusted, for the year ended December 31, 2019, were $18.6 million, an increase of $6.1
million as compared in 2018.
reconciliation between GAAP and non-GAAP operating expenses is provided in the financial tables included with this earnings release.
and development expenses for fourth quarter of 2019 were $2.3 million as compared to $1.2 million for the same period in 2018,
an increase of $1.1 million. The increase was primarily attributable to personnel and laboratory related expenses for the completion
of CLIA validation of DetermaDxTM. Research and development expenses for 2019 were $6.8 million as compared to $6.5 million for
2018, remained relatively unchanged.
and administrative expenses for the fourth quarter of 2019 were $4.2 million, as compared to $2.6 million for the same period
in 2018, an increase of $1.6 million. General and administrative expenses for the year ended December 31, 2019, were $13.3 million,
as compared to $7.0 million for 2018, an increase of $6.3 million. The increases were primarily attributable to personnel and
related expenses, including management transition costs; investment banking expenses; legal, business development, investor relations,
recruiting, audit and accounting related expenses; and noncash stock-based compensation expense due to additional equity grants.
As Oncocyte transitioned from Lineage Cell Therapeutics ("Lineage" formerly BioTime, Inc.) Shared Services by the
second half of 2019, Oncocyte hired its own administrative, human resources, legal, finance and accounting functions and teams.
This transition also included the termination of the Shared Facilities agreement with Lineage as of December 31, 2019, in which
Oncocyte leased its own facilities and laboratories and moved into its Irvine, California, headquarters in January 2020.
and marketing expenses for the three months ended December 31, 2019, were $1.0 million, as compared to $0.3 million for the same
period in 2018, an increase of $0.7 million. Sales and marketing expenses for 2019 were $2.2 million, as compared to $1.7 million
for 2018, an increase of $0.5 million. The increases were primarily due to sales and marketing efforts, including key hires and
ramp-up in activities for commercialization of DetermaRxTM.
Company will host a conference call today, March 25, 2020, at 4:30 pm EDT / 1:30 pm PDT to discuss the results along with recent
corporate developments.
dial-in number in the U.S./Canada is 877-407-9716; for international participants, the number is 201-493-6779. For all callers,
please refer to Conference ID 13700598. To access the live webcast, go to the investor relations section on the Company's
website, or by clicking here: http://public.viavid.com/index.php?id=136415.
Oncocyte Corporation
is a molecular diagnostics company whose mission is to provide actionable answers at critical decision points across the cancer
care continuum, with the goal of improving patient outcomes by accelerating and optimizing diagnosis and treatment. The Company
recently launched DetermaRx , a treatment stratification test that enables the identification of early-stage lung cancer
patients at high risk for recurrence post-resection, allowing them to be treated when their cancer may be more responsive to adjuvant
chemotherapy. DetermaDx , the company's liquid biopsy test in development, utilizes a proprietary immune system interrogation
approach to clarify if a patients' lung nodules are benign, which may enable them to avoid potentially risky invasive diagnostic
procedures. Oncocyte is also developing DetermaIO , a gene expression test that identifies patients more likely to respond
to checkpoint immunotherapies.
Forward Looking Statements
cautions you that this press release contains forward-looking statements concerning, but not limited to, the commercial launch
of DetermaRx, the acquisition of Insight Genetics, the commercial launch of DetermaIO for research use, and the DetermaDx clinical
validation study. Any statements that are not historical fact (including, but not limited to statements that contain words such
as "will," "believes," "plans," "anticipates," "expects," "estimates,"
"may," and similar expressions) are forward-looking statements. These statements include those pertaining to the development
of DetermaDx and the ongoing Clinical Validation study, the impact of the commercial launch of DetermaIO and DetermaRx, unexpected
expenditures or assumed liabilities or other unanticipated difficulties resulting from the acquisition of Insight Genetics, the
impact on our business of the COVID-19 pandemic, implementation and results of research, development, clinical trials and studies,
commercialization plans, future financial and/or operating results, and future opportunities for Oncocyte, along with other statements
about the future expectations, beliefs, goals, plans, or prospects expressed by management. Forward-looking statements involve
risks and uncertainties, including, without limitation, risks inherent in the development and/or commercialization of potential
diagnostic tests or products, uncertainty in the results of clinical trials or regulatory approvals, the capacity of our third-party
supplied blood sample analytic system to provide consistent and precise analytic results on a commercial scale, the need and ability
to obtain future capital, maintenance of intellectual property rights, and the need to obtain third party reimbursement for patients'
use of any diagnostic tests we commercialize, and risks inherent in acquisitions such as failure to realize the anticipated benefits
of the acquisition, unexpected expenditures or assumed liabilities that may be incurred as a result of the acquisition, unanticipated
difficulties in conforming business practices, including accounting policies, procedures and internal controls, or failure to
maintain any laboratory accreditation or certification. Actual results may differ materially from the results anticipated in these
forward-looking statements and accordingly such statements should be evaluated together with the many uncertainties that affect