Interpace Biosciences, Inc. (“Interpace” or the “Company”) (OTCQX:
IDXG) today announced financial results for the fiscal quarter
ended March 31, 2021 and provided a business and financial update.
“We are very pleased with our first quarter
operating results which are on track and in accordance with our
growth, restructuring and reprioritization plan,” said President
and CEO Thomas Burnell. “As we progress further into 2021, we
expect to build on this momentum and will be focused on
opportunities related to expanded private payor coverage, market
penetration and the pricing of clinical testing. We continue to
implement new clinical automation technology, have begun the
process of renovating and modernizing our Pittsburgh clinical
services laboratory, and in pharma services, we are exploring new
clinical development capabilities with the Company’s
state-of-the-art lab in Morrisville, North Carolina. We believe
these initiatives will help us drive growth and enhance shareholder
value,” added Mr. Burnell.
“Our strong first quarter results were driven
primarily by the positive impact of higher clinical service volume
and improved reimbursement rates,” stated Tom Freeburg, CFO of
Interpace. “We are very excited by the prospect of higher
reimbursement rates across non-Medicare payor categories given
positive clinical data and our recent improvements in Medicare
reimbursement. With the completion of the transition of pharma
services to our state of the art laboratory in North Carolina, we
are now uniquely positioned to take advantage of new clinical
development capabilities which we believe will further diversify
and enhance our overall business.”
“We are providing second quarter Fiscal 2021
revenue guidance north of $11 million,” added Mr. Freeburg.
First Quarter 2021 Financial Performance
as Compared to First Quarter 2020
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Net Revenue was $9.8 million, an increase of 9% versus the prior
year. Gross Profit percentage was 46%, compared to 33% for the
prior year, a nearly 40% improvement year over year. |
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Loss from Continuing Operations was approximately $(4.2) million as
compared to $(6.4) million for the prior year, a 35% improvement
year over year. |
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Adjusted EBITDA was $(0.9) million as compared to $(4.3) million
for the prior year, a nearly 400% improvement year over year. |
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Cash collections are exceeding expectations and continuing to grow.
Days Sales Outstanding (DSO) has decreased 34% year over year. |
First Quarter 2021 Financial Performance
as Compared to the Fourth Quarter of 2020
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Gross Profit margin was 46% for the first quarter 2021, vs 32% for
the fourth quarter 2020. |
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Loss from Continuing Operations was $(4.2) million vs $(8.1)
million in the fourth quarter 2020. |
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Adjusted EBITDA was $(0.9) million vs $(4.1) million in the fourth
quarter 2020. |
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March 31, 2021 cash balance was $2.8 million, net of restricted
cash. April 30, 2021 cash balance was $3.3 million, net of
restricted cash. |
Recent Highlights
- In January 2021, we announced an agreement with Blue Cross Blue
Shield of Florida under which ThyGeNEXT® and ThyraMIR® tests are
now covered in-network services for their 5 million members.
- In February 2021, we announced an agreement with Blue Cross
Blue Shield of Illinois that makes ThyGeNEXT® and ThyraMIR® tests
covered in-network services for their more than 8 million members
in Illinois.
- In February 2021, we announced that we had executed a license
agreement with Rutgers, The State University of New Jersey, and
Massachusetts General Hospital for a novel monoclonal antibody
platform, Das-1, used in the risk assessment of pancreatic
cysts.
- In March 2021, we announced that we had expanded our
relationship with XIFIN, Inc. to deploy XIFIN’s award-winning
revenue cycle management solution, XIFIN RPM 12, enterprise-wide to
support all Interpace Diagnostics testing services.
- In March 2021, we announced that we had entered into a
definitive agreement to sell our New Haven, CT CLIA certified, CAP
accredited laboratory to DiamiR Biosciences, Corp. (DiamiR). The
transaction closed in April 2021.
- In April 2021, we announced our new capability in advancing RNA
biomarker analysis for gene and cell-based therapies.
- In April 2021, we announced that Novitas, our Medicare
Administrative Contractor, has agreed to recognize the new
Proprietary Laboratory Analysis (PLA) code that specifically
identifies ThyGeNEXT® as a distinct test from any other test or
service. The new PLA code for ThyGeNEXT® is 0245U and the
reimbursement for this code remains $2,919, representing a
significant price increase over the prior reimbursement level of
$560.
- In April 2021, we announced that we initiated a full review of
a broad range of alternatives to enhance shareholder value. As part
of this process, we are considering strategic, financial and
operational alternatives involving the Company. Guggenheim
Securities, LLC is serving a strategic advisor in this
process.
- In May 2021, we announced that eviCore Healthcare (“eviCore”),
a wholly owned subsidiary of Cigna, has updated their laboratory
management guidelines to include positive coverage for ThyGeNEXT®
and ThyraMIR®. This update, which impacts approximately 27 health
plans nationwide covering 100 million lives, is effective on July
1, 2021. This means that after the effective date, claims for
ThyGeNEXT and ThyraMIR which meet eviCore’s criteria for coverage
will be considered medically necessary and processed as a covered
service.
About
Interpace Biosciences
Interpace Biosciences is an emerging leader in
enabling personalized medicine, offering specialized services along
the therapeutic value chain from early diagnosis and prognostic
planning to targeted therapeutic applications.
Clinical services, through Interpace
Diagnostics, provides clinically useful molecular diagnostic tests,
bioinformatics and pathology services for evaluating risk of cancer
by leveraging the latest technology in personalized medicine for
improved patient diagnosis and management. Interpace has five
commercialized molecular tests and one test in a clinical
evaluation program (CEP): PancraGEN® for the diagnosis and
prognosis of pancreatic cancer from pancreatic cysts; PanDNA, a
“molecular only” version of PancraGEN® that provides physicians a
snapshot of a limited number of factors; ThyGeNEXT® for the
diagnosis of thyroid cancer from thyroid nodules utilizing a next
generation sequencing assay; ThyraMIR® for the diagnosis of thyroid
cancer from thyroid nodules utilizing a proprietary gene expression
assay; and RespriDX® that differentiates lung cancer of primary
versus metastatic origin. In addition, BarreGEN®, a molecular based
assay that helps resolve the risk of progression of Barrett’s
Esophagus to esophageal cancer, is currently in a clinical
evaluation program (CEP) whereby we gather information from
physicians using BarreGEN® to assist us in gathering clinical
evidence relative to the safety and performance of the test and
also providing data that will potentially support payer
reimbursement.
Pharma services, through Interpace Pharma
Solutions, provides pharmacogenomics testing, genotyping,
biorepository and other customized services to the pharmaceutical
and biotech industries. Pharma services also advances personalized
medicine by partnering with pharmaceutical, academic, and
technology leaders to effectively integrate pharmacogenomics into
their drug development and clinical trial programs with the goals
of delivering safer, more effective drugs to market more quickly,
while also improving patient care.
For more information, please visit Interpace
Biosciences’ website at www.interpace.com.
Forward-looking Statements
This press release contains forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, Section 21E of the Securities Exchange Act of 1934 and the
Private Securities Litigation Reform Act of 1995, relating to the
Company’s future financial and operating performance. The Company
has attempted to identify forward looking statements by terminology
including “believes,” “estimates,” “anticipates,” “expects,”
“plans,” “projects,” “intends,” “potential,” “may,” “could,”
“might,” “will,” “should,” “approximately” or other words that
convey uncertainty of future events or outcomes to identify these
forward-looking statements. These statements are based on current
expectations, assumptions and uncertainties involving judgments
about, among other things, future economic, competitive and market
conditions and future business decisions, all of which are
difficult or impossible to predict accurately and many of which are
beyond the Company’s control. These statements also involve known
and unknown risks, uncertainties and other factors that may cause
the Company’s actual results to be materially different from those
expressed or implied by any forward-looking statements including,
but not limited to, the adverse impact of the COVID-19 pandemic on
the Company’s operations and revenues, the substantial doubt about
the Company’s ability to continue as a going concern, the
possibility that the Company’s estimates of future revenue may
prove to be materially inaccurate, the Company’s history of
operating losses, the Company’s ability to adequately finance its
business, the Company’s ability to repay its $7.5M secured bridge
loan, the Company’s dependence on sales and reimbursements from its
clinical services, the Company’s ability to retain or secure
reimbursement including its reliance on third parties to process
and transmit claims to payers and the adverse impact of any delay,
data loss, or other disruption in processing or transmitting such
claims, the Company’s revenue recognition being based in part on
estimates for future collections which estimates may prove to be
incorrect, and the Company’s ability to remediate material
weaknesses in internal controls. Additionally, all forward-looking
statements are subject to the “Risk Factors” detailed from time to
time in the Company’s Annual Report on Form 10-K for the fiscal
year ended December 31, 2020 filed with the Securities and Exchange
Commission , Current Reports on Form 8-K and Quarterly Reports on
Form 10-Q. Because of these and other risks, uncertainties and
assumptions, undue reliance should not be placed on these
forward-looking statements. In addition, these statements speak
only as of the date of this press release and, except as may be
required by law, the Company undertakes no obligation to revise or
update publicly any forward-looking statements for any reason.
Contacts:
Investor RelationsInterpace Biosciences,
Inc.(855)-776-6419Info@Interpace.com
INTERPACE BIOSCIENCES,
INC.CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (in thousands, except per share
data)
|
|
Three Months Ended |
|
|
|
March 31, |
|
|
|
2021 |
|
|
2020 |
|
|
|
|
|
|
|
|
Revenue, net |
|
$ |
9,833 |
|
|
$ |
9,059 |
|
Cost of revenue |
|
|
5,316 |
|
|
|
6,113 |
|
Gross Profit |
|
|
4,517 |
|
|
|
2,946 |
|
|
|
|
|
|
|
|
|
|
Sales and marketing |
|
|
2,351 |
|
|
|
2,481 |
|
Research and development |
|
|
637 |
|
|
|
809 |
|
General and
administrative |
|
|
2,979 |
|
|
|
4,837 |
|
Transition expenses |
|
|
1,253 |
|
|
|
56 |
|
Acquisition amortization
expense |
|
|
1,112 |
|
|
|
1,115 |
|
Total operating expenses |
|
|
8,332 |
|
|
|
9,298 |
|
|
|
|
|
|
|
|
|
|
Operating loss |
|
|
(3,815 |
) |
|
|
(6,352 |
) |
Interest accretion
expense |
|
|
(135 |
) |
|
|
(109 |
) |
Other (expense) income,
net |
|
|
(188 |
) |
|
|
47 |
|
Loss from continuing operations before tax |
|
|
(4,138 |
) |
|
|
(6,414 |
) |
Provision for income
taxes |
|
|
15 |
|
|
|
15 |
|
Loss from continuing operations |
|
|
(4,153 |
) |
|
|
(6,429 |
) |
|
|
|
|
|
|
|
|
|
Loss from discontinued operations, net of tax |
|
|
(54 |
) |
|
|
(65 |
) |
|
|
|
|
|
|
|
|
|
Net loss |
|
|
(4,207 |
) |
|
|
(6,494 |
) |
Less adjustment for preferred
stock deemed dividend |
|
|
- |
|
|
|
(3,033 |
) |
Net loss attributable to common stockholders |
|
$ |
(4,207 |
) |
|
$ |
(9,527 |
) |
|
|
|
|
|
|
|
|
|
Basic and diluted loss per
share of common stock: |
|
|
|
|
|
|
|
|
From continuing operations |
|
$ |
(1.02 |
) |
|
$ |
(2.37 |
) |
From discontinued operations |
|
|
(0.01 |
) |
|
|
(0.01 |
) |
Net loss per basic share of
common stock |
|
$ |
(1.03 |
) |
|
$ |
(2.38 |
) |
|
|
|
|
|
|
|
|
|
Weighted average number of
common shares and common share equivalents outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
|
4,089 |
|
|
|
4,004 |
|
Diluted |
|
|
4,089 |
|
|
|
4,004 |
|
Selected Balance Sheet Data
(Unaudited)($ in thousands)
|
|
March 31, |
|
|
December 31, |
|
|
|
2021 |
|
|
2020 |
|
Cash and cash equivalents |
|
$ |
2,839 |
|
|
$ |
2,772 |
|
|
|
|
|
|
|
|
|
|
Total current assets |
|
|
14,265 |
|
|
|
14,122 |
|
Total current liabilities |
|
|
20,461 |
|
|
|
18,233 |
|
|
|
|
|
|
|
|
|
|
Total assets |
|
|
43,858 |
|
|
|
45,681 |
|
Total liabilities |
|
|
30,218 |
|
|
|
28,228 |
|
Total stockholders’
deficit |
|
|
(32,896 |
) |
|
|
(29,083 |
) |
Selected Cash Flow Data
(Unaudited)($ in thousands)
|
|
For the Three Months Ended |
|
|
|
March 31, |
|
|
|
2021 |
|
|
2020 |
|
Net loss |
|
$ |
(4,207 |
) |
|
$ |
(6,494 |
) |
|
|
|
|
|
|
|
|
|
Net cash used in operating
activities |
|
$ |
(5,006 |
) |
|
$ |
(7,122 |
) |
Net cash provided by investing
activities |
|
|
39 |
|
|
|
- |
|
Net cash provided by financing
activities |
|
|
5,034 |
|
|
|
18,171 |
|
Change in cash, cash
equivalents and restricted cash |
|
|
67 |
|
|
|
11,049 |
|
Cash, cash equivalents and
restricted cash – beginning |
|
|
3,372 |
|
|
|
2,321 |
|
Cash, cash equivalents and
restricted cash – ending |
|
$ |
3,439 |
|
|
$ |
13,370 |
|
Reconciliation of Adjusted EBITDA
(Unaudited)($ in thousands)
|
|
Quarters Ended |
|
|
|
March 31, |
|
|
|
2021 |
|
|
2020 |
|
Loss from continuing
operations (GAAP Basis) |
|
$ |
(4,153 |
) |
|
$ |
(6,429 |
) |
Bad debt (recovery)
expense |
|
|
(140 |
) |
|
|
250 |
|
Transition expenses |
|
|
1,253 |
|
|
|
56 |
|
Depreciation and
amortization |
|
|
1,532 |
|
|
|
1,319 |
|
Stock-based compensation |
|
|
286 |
|
|
|
418 |
|
Taxes |
|
|
15 |
|
|
|
15 |
|
Financing interest and related
costs |
|
|
144 |
|
|
|
- |
|
Interest accretion
expense |
|
|
135 |
|
|
|
109 |
|
Mark to market on warrant
liability |
|
|
41 |
|
|
|
(26 |
) |
Change in fair value of
contingent consideration |
|
|
(57 |
) |
|
|
- |
|
Adjusted EBITDA |
|
$ |
(944 |
) |
|
$ |
(4,288 |
) |
Non-GAAP Financial Measures
In addition to the United States generally
accepted accounting principles, or GAAP, results provided
throughout this document, we have provided certain non-GAAP
financial measures to help evaluate the results of our performance.
We believe that these non-GAAP financial measures, when presented
in conjunction with comparable GAAP financial measures, are useful
to both management and investors in analyzing our ongoing business
and operating performance. We believe that providing the non-GAAP
information to investors, in addition to the GAAP presentation,
allows investors to view our financial results in the way that
management views financial results.
In this document, we discuss Adjusted EBITDA, a
non-GAAP financial measure. Adjusted EBITDA is a metric used by
management to measure cash flow of the ongoing business. Adjusted
EBITDA is defined as income or loss from continuing operations,
plus depreciation and amortization, acquisition related expenses,
transition expenses, non-cash stock based compensation and ESPP
plans, interest and taxes, and other non-cash expenses including
asset impairment costs, bad debt expense, receipt of stimulus
grants, loss on extinguishment of debt, goodwill impairment and
change in fair value of contingent consideration, and warrant
liability. The table above includes a reconciliation of this
non-GAAP financial measure to the most directly comparable GAAP
financial measure.
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