Full Press Release Details
iSpecimen Reports Second Quarter 2021 Financial
-Delivered Revenue Growth of 93% Year-Over-Year-
-Successfully Completed IPO Raising Total Gross
Proceeds of $20.7 Million-
August 10, 2021 - iSpecimen Inc. (Nasdaq: ISPC) ("iSpecimen" or the "Company"),
an online marketplace for human biospecimens, today reported its financial results for the three-month period ended June 30, 2021.
"During the second quarter of 2021, iSpecimen successfully completed
its initial public offering and began trading on the Nasdaq Capital Market. This is both a significant milestone and the starting point
of a new and exciting chapter for the Company," said Christopher Ianelli, MD, PhD, CEO and President of iSpecimen. "During
the quarter, we continued to deliver exceptional financial and operating performance, posted revenue growth of 93% on a year-over-year
basis and increased the number of registered research users on the iSpecimen Marketplace by 40% year-over-year to more than 3,800 users.
With our enhanced capital position, iSpecimen is well-positioned to expand and scale its operations, with the goal of becoming the preeminent,
online marketplace for human biospecimens."
"We continue to broaden our supply network and data assets while
improving our technology platform, which should accelerate our sales and revenue momentum as more suppliers and customers embrace the
iSpecimen Marketplace. Through our continued expansion, iSpecimen is disrupting the biospecimen procurement process, providing instant
access to a vast repository of biospecimens and patient data from a global network of healthcare organizations, thereby empowering researchers
to advance scientific discovery," concluded Dr. Ianelli.
Q2 2021 Financial and Operational Updates
Recent Corporate Updates
Financial Results for the Second Quarter of 2021
Revenue for the second quarter of 2021 increased 93% to approximately
$2.9 million, compared to approximately $1.5 million for the same period in 2020. The 93% year-over-year increase was primarily due to
the success of iSpecimen's maturing sales team, continued demand for specimens from patients with known COVID-19 test results, and
an increasing demand for specimens in non-COVID-19 research areas.
Cost of revenue was approximately $1.5 million for the second quarter
of 2021, compared to approximately $0.5 million for the second quarter of 2020. This increase was attributable to an 8% increase in the
number of specimens accessioned as well as a 191% increase in the average cost per specimen due to the specimen mix during the second
quarter of 2021, compared to the prior year period. In addition to the increase in the average cost per specimen in 2021 being related
to specimen mix, a significant project in 2020, which yielded a sizably lower than average cost per specimen, significantly impacted the
magnitude of the year over year difference in the average cost per specimen.
General and administrative expenses were approximately $1.5 million
for the second quarter of 2021, compared to approximately $0.3 million for the second quarter 2020. The increase was primarily attributable
to an increase in costs related to becoming a public company including an increase in legal and accounting expenses, an increase of other
general and administrative expenses across the board related to amortization of internally developed software, associated software licenses,
human resource related expenses, insurance costs and facility expenses, an increase in director and officer insurance, and an increase
in payroll related costs for the chief financial officer. Additionally, the remaining increase is related to costs not expected to recur
in the future, such as payroll expenses of approximately $0.5 million for a special IPO bonus provided to all employees and increased
legal, accounting and consulting expenses of approximately $0.3 million that did not qualify as offering costs.
Net loss was approximately $1.4 million for the second quarter of 2021,
compared to approximately $0.2 million for the same period in 2020. This was primarily due to higher operating expenses partially offset
by an increase in revenue, all associated with the factors mentioned above.
Cash was approximately $13.2 million as of June 30, 2021.
Conference Call and Webcast Information
The Company will host a conference call and audio webcast today, Tuesday,
August 10th at 8:30 a.m. Eastern Time featuring remarks by Christopher Ianelli, MD, PhD, CEO and President, Tracy
Curley, CFO and Treasurer, and Jill Mullan, COO and Secretary.
| Event: | iSpecimen Second Quarter 2021 Results Conference Call |
| Date: | Tuesday, August 10, 2021 |
| Time: | 8:30 a.m. Eastern Time |
| Live Call: | +1-877-425-9470 (Toll Free) or + 1-201-389-0878 (International) |
| Webcast: | http://public.viavid.com/index.php?id=145777 |
For interested individuals unable to
join the conference call, a replay will be available through August 24, 2021, at +1-844-512-2921 (U.S. Toll Free) or +1-412-317-6671
(International). Participants must use the following code to access the replay of the call: 13721607. An archived version of the webcast
will also be available on iSpecimen's Investor Relations site: https://ispecimen.irpass.com/.
iSpecimen offers an online marketplace
for human biospecimens, connecting life scientists in commercial and non-profit organizations with healthcare providers that have access
to patients and specimens needed for medical discovery. Proprietary, cloud-based technology enables scientists to intuitively search
for specimens and patients across a federated partner network of hospitals, labs, biobanks, blood centers, and other healthcare organizations.
For more information about iSpecimen, please visit www.ispecimen.com.
Forward Looking Statements
This press release may contain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Such forward-looking statements are characterized by future or conditional verbs such as "may," "will,"
"expect," "intend," "anticipate," believe," "estimate" and "continue"
or similar words. You should read statements that contain these words carefully because they discuss future expectations and plans, which
contain projections of future results of operations or financial condition or state other forward-looking information.
Forward-looking statements are predictions, projections and other statements
about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many
factors could cause actual future events to differ materially from the forward-looking statements in this press release, including but
not limited to the risks factors contained in the Company's filings with the Securities and Exchange Commission, which are available for
review at www.sec.gov. Forward-looking statements speak only as of the date they are made. New risks and uncertainties arise over time,
and it is not possible for the Company to predict those events or how they may affect the Company. If a change to the events and circumstances
reflected in the Company's forward-looking statements occurs, the Company's business, financial condition and operating results
may vary materially from those expressed in the Company's forward-looking statements.
Readers are cautioned not to put undue reliance on forward-looking
statements, and the Company assumes no obligation and do not intend to update or revise these forward-looking statements, whether as a
result of new information, future events or otherwise.
For further information, please contact:
KCSA Strategic Communications
Allison Soss / Scott Eckstein
Condensed Balance Sheets
| June 30, 2021 | December 31, 2020 | |||||||
| ASSETS | (Unaudited) | |||||||
| Current assets: | ||||||||
| Cash | $ | 13,184,310 | $ | 695,909 | ||||
| Accounts receivable - unbilled | 1,125,789 | 652,761 | ||||||
| Accounts receivable, net of allowance for doubtful accounts of $147,714 and $108,096 at June 30, 2021 and December 31, 2020, respectively | 1,987,112 | 1,526,392 | ||||||
| Prepaid expenses and other current assets | 442,089 | 417,929 | ||||||
| Tax credit receivable, current portion | 179,376 | 179,376 | ||||||
| Total current assets | 16,918,676 | 3,472,367 | ||||||
| Property and equipment, net | 55,879 | 75,589 | ||||||
| Internally developed software, net | 2,602,886 | 2,634,139 | ||||||
| Security deposits | 27,601 | 27,601 | ||||||
| Total assets | $ | 19,605,042 | $ | 6,209,696 | ||||
| LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 3,233,231 | $ | 1,792,432 | ||||
| Accrued expenses | 1,879,812 | 810,910 | ||||||
| Accrued interest | 9,864 | 3,696,944 | ||||||
| Convertible notes payable, related parties, net of unamortized debt discount and debt issuance costs | - | 5,490,811 | ||||||
| Derivative liability for embedded conversion features on convertible notes payable | - | 2,373,000 | ||||||
| Bridge notes payable, net of debt issuance costs | - | 4,589,228 | ||||||
| Bridge notes payable, related parties | - | 1,905,000 | ||||||
| Derivative liability for embedded conversion feature on bridge notes payable and bridge notes, related parties | - | - | ||||||
| Note payable, current portion | - | 604,109 | ||||||
| Deferred revenue | 802,860 | 873,254 | ||||||
| Total current liabilities | 5,925,767 | 22,135,688 | ||||||
| Note payable, net of current portion | - | 178,899 | ||||||
| Bridge notes payable, net of debt issuance costs | 2,675,000 | - | ||||||
| Bridge notes payable, related parties | 325,000 | - | ||||||
| Total liabilities | 8,925,767 | 22,314,587 | ||||||
| Commitments and contingencies | ||||||||
| Series B convertible preferred stock, $0.0001 par value, 3,200,000 shares authorized, 0 and 572,465 shares issued and outstanding at June 30, 2021 and December 31, 2020, respectively | - | 7,999,997 | ||||||
| Series A-1 convertible preferred stock, $0.0001 par value, 556,550 shares authorized, 0 and 100,365 issued and outstanding at June 30, 2021 and December 31, 2020, respectively | - | 561,041 | ||||||
| Series A convertible preferred stock, $0.0001 par value, 3,427,871 shares authorized, 0 and 618,182 issued and outstanding at June 30, 2021 and December 31, 2020, respectively | - | 2,612,038 | ||||||
| Total convertible preferred stock | - | 11,173,076 | ||||||
| Stockholders' equity (deficit) | ||||||||
| Common stock, $0.0001 par value, 200,000,000 shares authorized, 6,596,729 issued, and 6,565,729 outstanding at June 30, 2021, and 16,000,000 shares authorized, 967,213 issued and 936,213 outstanding at December 31, 2020 | 657 | 94 | ||||||
| Additional paid-in capital | 45,094,782 | 1,779,698 | ||||||
| Treasury stock, 31,000 shares at June 30, 2021 and December 31, 2020, at cost | (172 | ) | (172 | ) | ||||
| Accumulated deficit | (34,415,992 | ) | (29,057,587 | ) | ||||
| Total stockholders' equity (deficit) | 10,679,275 | (27,277,967 | ) | |||||
| Total liabilities, convertible preferred stock and stockholders' equity (deficit) | $ | 19,605,042 | $ | 6,209,696 |
Condensed Statements of Operations
| Three months ended June 30, | Six months ended June 30, | |||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
| Revenue | $ | 2,903,876 | $ | 1,504,569 | $ | 5,867,683 | $ | 3,216,228 | ||||||||
| Operating expenses: | ||||||||||||||||
| Cost of revenue | 1,489,196 | 473,982 | 3,112,847 | 1,128,249 | ||||||||||||
| Technology | 361,799 | 291,601 | 771,750 | 718,314 | ||||||||||||
| Sales and marketing | 647,592 | 367,617 | 1,176,978 | 799,256 | ||||||||||||
| Supply development | 100,693 | 147,588 | 212,269 | 262,193 | ||||||||||||
| Fulfillment | 287,275 | 185,185 | 556,371 | 400,355 | ||||||||||||
| General and administrative | 1,545,852 | 343,602 | 2,508,643 | 656,855 | ||||||||||||
| Total operating expenses | 4,432,407 | 1,809,575 | 8,338,858 | 3,965,222 | ||||||||||||
| Loss from operations | (1,528,531 | ) | (305,006 | ) | (2,471,175 | ) | (748,994 | ) | ||||||||
| Other income (expense), net | ||||||||||||||||
| Interest expense | (1,133,479 | ) | (459,005 | ) | (1,986,407 | ) | (1,048,220 | ) | ||||||||
| Change in fair value of derivative liability on convertible notes | (117,000 | ) | 583,000 | (271,000 | ) | (22,000 | ) | |||||||||
| Change in fair value of derivative liability on bridge notes and bridge notes, related parties | 1,630,700 | - | 1,582,700 | - | ||||||||||||
| Gain (loss) on extinguishment of bridge notes and bridge notes, related parties | 9,746 | - | (2,740,425 | ) | - | |||||||||||
| Loss on extinguishment of convertible notes and convertible notes, related parties | (260,185 | ) | - | (260,185 | ) | - | ||||||||||
| Gain on extinguishment of note payable | - | - | 788,156 | - | ||||||||||||
| Other income (expense) | 3,663 | 6,688 | (69 | ) | 6,691 | |||||||||||
| Interest income | 172 | 86 | - | 309 | ||||||||||||
| Other income (expense), net | 133,617 | 130,769 | (2,887,230 | ) | (1,063,220 | ) | ||||||||||
| Net loss before benefit from income taxes | (1,394,914 | ) | (174,237 | ) | (5,358,405 | ) | (1,812,214 | ) | ||||||||
| Benefit from income taxes | - | 145 | - | 145 | ||||||||||||
| Net loss | $ | (1,394,914 | ) | $ | (174,092 | ) | $ | (5,358,405 | ) | $ | (1,812,069 | ) | ||||
| Net loss per share | ||||||||||||||||
| Basic and diluted | $ | (0.87 | ) | $ | (0.19 | ) | $ | (4.21 | ) | $ | (1.94 | ) | ||||
| Weighted average common shares outstanding | ||||||||||||||||
| Basic and diluted | 1,611,774 | 936,213 | 1,273,993 | 936,213 |