Submitted 510(k) Application to the FDA
Requesting Market Clearance for T2Bacteria PanelYear over Year
Quarterly Product Revenue Growth of 27.4%
T2 Biosystems, Inc. (NASDAQ:TTOO), an emerging leader in the
development of innovative diagnostic products to improve patient
health, announced today operating highlights and financial results
for the third quarter ended September 30, 2017.
Third Quarter Business and Financial Performance
Highlights:
- Reported third quarter total revenue of $1.1 million, in line
with guidance. Product revenue of $739,000, was a $159,000 or 27.4%
increase from the third quarter of 2016.
- Submitted 510(k) application to the FDA requesting market
clearance for T2Bacteria® Panel; continue to plan for FDA clearance
as early as year-end.
- Secured contracts with seven new hospitals internationally
primarily for initial implementation of the T2Candida® Panel and
three hospitals in the US for the T2Bacteria Research Use Only
Panel, that could provide access to an estimated 58,000 additional
patients annually considered to be at high risk for sepsis
infections.
- Featured in seven sessions at IDWeek 2017 highlighting the
positive impact of T2Candida and potential impact of T2Bacteria,
including a session highlighting the potential benefits of the
T2Bacteria Panel within the emergency department.
- Henry Ford Health System published a study in the Journal of
Antimicrobial Stewardship assessing the benefit and value of the
rapid diagnostic result obtained with the T2Candida Panel.
- Announced a partnership with the Centers for Disease Control
and Prevention (CDC) describing a new effort to use the T2Dx®
Instrument and the Candida auris Investigational Use Only Panel to
rapidly detect the superbug Candida auris.
- Commenced a partnership with the biotechnology company Cidara
Therapeutics to use the T2Dx Instrument along with the T2Candida
Panel as a means of accelerating patient enrollment in their Phase
3 clinical trial evaluating its lead antifungal compound.
- Closed equity financing raising $20.1 million in gross proceeds
to fund continued research and development of T2 Biosystems
pipeline and commercialization of the T2Sepsis SolutionTM.
“Our operating progress in the third quarter was one of the best
we have had,” said John McDonough, president and chief executive
officer of T2 Biosystems. “We completed the T2Bacteria Panel FDA
filing for market clearance, closed two exciting new partnerships –
one with the CDC for the detection of the Candida auris superbug
and the other with Cidara to facilitate clinical trial recruitment,
both of which could lead to new revenue opportunities for the
company, and closed a $20.1 million gross equity financing. Total
company revenue was in line with our guidance while product revenue
was slightly behind, due to orders received late in the quarter
that could not be shipped by quarter end.”
Third Quarter Financial Results:
Total revenue for the third quarter of $1.1 million increased 2%
over the third quarter of 2016 and 15.8% over the second quarter of
this year. Product revenue for the third quarter of 2017 was up
27.4% from the third quarter of 2016 while growing slightly from
the second quarter of this year. Product revenue was negatively
impacted by an order received late in the quarter that could not be
shipped in the third quarter. Research revenue in the third quarter
of 2017 of $369,000 exceeded our guidance of less than $100,000,
however declined year over year by $135,000 as expected, primarily
due to a decline in revenue recognized from our co-development
agreement with Canon U.S. Life Sciences.
Operating expenses, excluding cost of product revenue, in the
third quarter decreased sequentially from the second quarter of
2017 by $1.4 million and increased $304,000 to $11.4 million, from
$11.1 million in the third quarter of 2016. The quarterly
year-over-year increase in operating expense was primarily driven
by a $680,000 increase in research and development expenses, offset
by a $376,000 reduction in SG&A expenses.
Net loss attributable to common shareholders for the third
quarter of 2017 was $14.1 million, or $0.45 per basic and diluted
share, compared to a net loss of $12.8 million or $0.51 per basic
and diluted share in the same period of the prior year.
Cash and cash equivalents as of September 30, 2017 was $52.9
million and reflects the equity financing completed in September
which raised an additional $18.8 million in net proceeds which,
together with the additional remaining liquidity on the Company’s
term loan of up to $10 million, should extend the company’s cash
runway into the first half of 2019.
Outlook for Remainder of 2017:
The company is updating guidance for 2017, as follows:
- The company reaffirms expectations regarding the timeframe for
FDA clearance of the T2Bacteria Panel and continues to prepare for
the commercial launch of the T2Bacteria Panel in the U.S. as early
as year-end, pending market clearance by the FDA.
- Total revenue in the fourth quarter is expected to be in the
range of $1.1 million to $1.3 million. Fourth quarter 2017 product
revenue is expected to be in the range of $1.0 million to $1.2
million which would be a growth rate of 36% to 63% over the third
quarter of 2017. Research revenue is expected to be in the range of
$100,000 in the fourth quarter.
- The target for increasing the number of high-risk patients at
customer facilities under contract in the fourth quarter is 35,000
high risk patients, including additional contracts in the United
States for the use of the T2Bacteria Research Use Only Panel.
- Operating expenses, excluding cost of product revenue, for the
fourth quarter are projected to be in the range of $11.4 million to
$11.8 million.
Conference Call
Management will host a conference call today with the investment
community at 4:30 p.m. Eastern Time to discuss the financial
results and other business developments. Interested parties may
access the live call via telephone by dialing 1-877-407-9208 (U.S.)
or 1-201-493-6784 (International). To listen to the live call via
T2 Biosystems' website, go to www.t2biosystems.com, in the
Investors/Events & Presentations section. A webcast replay of
the call will be available following the conclusion of the call,
also in the Investors/Events & Presentations section of the
website.
About T2 Biosystems T2 Biosystems, an
emerging leader in the field of in vitro diagnostics, is dedicated
to saving lives and reducing the cost of healthcare by empowering
clinicians to effectively treat patients faster than ever before.
T2 Biosystems is focused on addressing critical unmet needs in
healthcare starting with sepsis, one of the deadliest and most
expensive conditions in hospitals today. The T2Sepsis Solution is a
unique approach that combines the standard of care for the
management of sepsis patients with T2 Biosystems’ products,
including the T2Dx Instrument and T2Candida Panel, and the
T2Bacteria Panel, which is commercially available in Europe and
other countries that accept the CE Mark and available for research
use only in the U.S. Powered by the proprietary T2 Magnetic
Resonance technology, or T2MR®, the T2Sepsis Solution is proven to
deliver better patient care and greater cost savings. Hospital
customer experience has demonstrated faster time to effective
treatment, shortened ICU and hospital lengths of stay, reduced use
of unnecessary antifungals, and millions of dollars in savings. T2
Biosystems has an active pipeline of future sepsis products,
including additional species and antibiotic resistance, as well as
tests for Lyme disease and hemostasis. For more information, please
visit www.t2biosystems.com.
Forward-Looking Statements This press
release contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. All
statements contained in this press release that do not relate to
matters of historical fact should be considered forward-looking
statements, including, without limitation, statements regarding
additional patients, timing of testing patients, anticipated
product benefits, strategic priorities, product expansion or
opportunities, growth expectations or targets, timing of FDA
filings or clearances and anticipated operating expenses, as well
as statements that include the words “expect,” “intend,” “plan”,
“believe”, “project”, “forecast”, “estimate,” “may,” “should,”
“anticipate,” and similar statements of a future or forward looking
nature. These forward-looking statements are based on management's
current expectations. These statements are neither promises nor
guarantees, but involve known and unknown risks, uncertainties and
other important factors that may cause actual results, performance
or achievements to be materially different from any future results,
performance or achievements expressed or implied by the
forward-looking statements, including, but not limited to, (i) any
inability to (a) realize anticipated benefits from commitments,
contracts or products; (b) successfully execute strategic
priorities; (c) bring products to market; (d) expand product usage
or adoption; (e) obtain customer testimonials; (f) accurately
predict growth assumptions; (g) realize anticipated revenues; (h)
incur expected levels of operating expenses; or (i) increase the
number of high-risk patients at customer facilities; (ii) failure
of early data to predict eventual outcomes; (iii) failure to
make or obtain anticipated FDA filings or clearances within
expected time frames or at all; or (iv) the factors discussed under
Item 1A. "Risk Factors" in the company's Annual Report on Form 10-K
for the year ended December 31, 2016, filed with the U.S.
Securities and Exchange Commission, or SEC, on March 15, 2017, and
other filings the company makes with the SEC from time to
time. These and other important factors could cause actual
results to differ materially from those indicated by the
forward-looking statements made in this press release. Any such
forward-looking statements represent management's estimates as of
the date of this press release. While the company may elect to
update such forward-looking statements at some point in the future,
unless required by law, it disclaims any obligation to do so, even
if subsequent events cause its views to change. Thus, no one should
assume that the Company’s silence over time means that actual
events are bearing out as expressed or implied in such
forward-looking statements. These forward-looking statements
should not be relied upon as representing the company's views as of
any date subsequent to the date of this press release.
|
T2
BIOSYSTEMS, INC. |
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND
COMPREHENSIVE LOSS |
|
|
|
(In
thousands, except share and per share data) |
|
|
|
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
September 30, |
|
September 30, |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
|
Revenue: |
|
|
|
|
|
|
|
|
Product
revenue |
$ |
739 |
|
|
$ |
580 |
|
|
$ |
2,105 |
|
|
$ |
1,168 |
|
|
Research
revenue |
|
369 |
|
|
|
504 |
|
|
|
900 |
|
|
|
2,003 |
|
|
Total revenue |
|
1,108 |
|
|
|
1,084 |
|
|
|
3,005 |
|
|
|
3,171 |
|
|
Costs and
expenses: |
|
|
|
|
|
|
|
|
Cost of
product revenue |
|
2,106 |
|
|
|
1,894 |
|
|
|
5,722 |
|
|
|
4,701 |
|
|
Research
and development |
|
5,880 |
|
|
|
5,200 |
|
|
|
19,577 |
|
|
|
18,160 |
|
|
Selling,
general and administrative |
|
5,559 |
|
|
|
5,935 |
|
|
|
17,192 |
|
|
|
18,282 |
|
|
Total costs and
expenses |
|
13,545 |
|
|
|
13,029 |
|
|
|
42,491 |
|
|
|
41,143 |
|
|
Loss from
operations |
|
(12,437 |
) |
|
|
(11,945 |
) |
|
|
(39,486 |
) |
|
|
(37,972 |
) |
|
Interest expense,
net |
|
(1,718 |
) |
|
|
(876 |
) |
|
|
(5,008 |
) |
|
|
(2,416 |
) |
|
Other income, net |
|
79 |
|
|
|
38 |
|
|
|
260 |
|
|
|
133 |
|
|
Net loss and
comprehensive loss |
$ |
(14,076 |
) |
|
$ |
(12,783 |
) |
|
$ |
(44,234 |
) |
|
$ |
(40,255 |
) |
|
Net loss per share —
basic and diluted |
$ |
(0.45 |
) |
|
$ |
(0.51 |
) |
|
$ |
(1.43 |
) |
|
$ |
(1.64 |
) |
|
Weighted-average number
of common shares used in computing net loss per share —
basic and diluted |
|
31,420,726 |
|
|
|
25,027,751 |
|
|
|
30,873,930 |
|
|
|
24,524,508 |
|
|
|
|
|
|
|
|
T2
BIOSYSTEMS, INC. |
|
|
|
|
|
CONDENSED CONSOLIDATED BALANCE SHEETS |
|
|
(In
thousands, except share and per share data) |
|
|
(Unaudited) |
|
|
|
|
September 30, 2017 |
|
December 31, 2016 |
|
|
Assets |
|
|
|
|
|
Current assets: |
|
|
|
|
|
Cash and
cash equivalents |
$ |
52,897 |
|
|
$ |
73,488 |
|
|
|
Accounts
receivable |
|
442 |
|
|
|
327 |
|
|
|
Prepaid expenses and other current assets |
|
754 |
|
|
|
820 |
|
|
|
Inventories, net |
|
1,254 |
|
|
|
803 |
|
|
|
Total
current assets |
|
55,347 |
|
|
|
75,438 |
|
|
|
Property and equipment,
net |
|
13,854 |
|
|
|
13,589 |
|
|
|
Restricted cash |
|
260 |
|
|
|
260 |
|
|
|
Other assets |
|
218 |
|
|
|
281 |
|
|
|
Total assets |
$ |
69,679 |
|
|
$ |
89,568 |
|
|
|
Liabilities and
stockholders’ equity |
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
Accounts
payable |
$ |
993 |
|
|
$ |
962 |
|
|
|
Accrued
expenses and other current liabilities |
|
5,513 |
|
|
|
4,908 |
|
|
|
Current
portion of notes payable |
|
1,416 |
|
|
|
1,269 |
|
|
|
Deferred
revenue |
|
2,076 |
|
|
|
2,445 |
|
|
|
Current
portion of lease incentives |
|
247 |
|
|
|
301 |
|
|
|
Total
current liabilities |
|
10,245 |
|
|
|
9,885 |
|
|
|
Notes payable, net of
current portion |
|
40,089 |
|
|
|
39,504 |
|
|
|
Lease incentives, net
of current portion |
|
751 |
|
|
|
792 |
|
|
|
Other liabilities |
|
467 |
|
|
|
49 |
|
|
|
Stockholders’
equity: |
|
|
|
|
|
Preferred
stock, $0.001 par value; 10,000,000 shares authorized; no shares
issued and outstanding at September 30, 2017 and December 31,
2016 |
|
— |
|
|
|
— |
|
|
|
Common
stock, $0.001 par value; 200,000,000 shares authorized;
35,796,322 and 30,482,712 shares issued and outstanding
at September 30, 2017 and December 31, 2016, respectively |
|
36 |
|
|
|
30 |
|
|
|
Additional paid-in capital |
|
266,014 |
|
|
|
242,997 |
|
|
|
Accumulated deficit |
|
(247,923 |
) |
|
|
(203,689 |
) |
|
|
Total
stockholders’ equity |
|
18,127 |
|
|
|
39,338 |
|
|
|
Total liabilities and
stockholders’ equity |
$ |
69,679 |
|
|
$ |
89,568 |
|
|
|
Company Contact:Darlene Deptula-Hicks, T2
BiosystemsSVP & Chief Financial
Officerddeptula@t2biosystems.com603-553-5803
Media Contact:Amy Phillips, Feinstein Kean
Healthcareamy.phillips@fkhealth.com412-327-9499
Investor Contact:Chris Brinzey, Westwicke
Partners chris.brinzey@westwicke.com339-970-2843
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