On November 14, 2024 bioAffinity Technologies, Inc. (Nasdaq: BIAF; BIAFW), a biotechnology company focused on the need for noninvasive, accurate tests for the detection of early-stage lung cancer and other lung diseases, reported financial results for the three months ended September 30, 2024 (Press release, BioAffinity Technologies, NOV 14, 2024, View Source [SID1234648390]).
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Key Highlights
● Generated quarterly revenue of $2.4 million in the third quarter of 2024.
● More than 1,300% growth rate for CyPath Lung orders in first nine months of 2024 over full-year 2023.
● Number of physician offices signed increased by 75% compared to the second quarter of 2024, setting the stage for acceleration of CyPath Lung sales in the quarters ahead.
● In October 2024, CyPath Lung was added to the U.S. Federal Supply Schedule (FSS), a procurement system that provides the Veterans Health Administration and the Military Health System streamlined access to state-of-the-art healthcare products and services. Under the FSS contract, Veterans at high risk for lung cancer will have easy access to CyPath Lung through 1,380 government health care facilities. Approximately 8,000 Veterans are treated for lung cancer annually, according to the VA.
● Referrals and word-of-mouth from physicians, including key opinion leaders (KOLs), continues to be a key driver for expanding CyPath Lung in states beyond Texas; now receiving CyPath Lung orders from physicians in 11 states, up from eight in the second quarter of 2024. In addition to previously reported orders from Pennsylvania, New Jersey, North Carolina, Arizona, Michigan, California, and Ohio, physicians in Alabama, Louisiana and Illinois have also begun ordering CyPath Lung tests.
● Added new sales representative to target increasing opportunities in Texas.
● Continued to advance new product development initiatives in collaboration with Brooke Army Medical Center, the U.S Department of Defense’s largest military health organization, focusing on tests that use the Company’s artificial intelligence and flow cytometry platform for diagnosing COPD and a companion test with bronchoscopy.
● Economic study published in Journal of Health Economics and Outcomes Research, a peer-reviewed journal, concludes that adding CyPath Lung to the standard of care for Medicare patients with a positive lung cancer screening could have saved an average of $2,773 per patient for total cost savings of $379 million in 2022.
● Awarded a Certificate of Grant of Patent from the Japan Patent Office for the Company’s unique method using flow cytometry to predict the likelihood of lung disease, including the CyPath Lung diagnostic test for early-stage lung cancer.
● Appointed William Bauta, Ph.D., as Chief Science Officer following the retirement of Vivienne I. Rebel, M.D., Ph.D. Dr. Bauta joined bioAffinity in 2016 as Senior Vice President. Previously, he was Associate Director of science at Genzyme.
● Successfully closed a $2.7 million registered direct offering and concurrent private placement to fund continued growth.
Management Commentary
"We are pleased with the continued progress we achieved in the third quarter, highlighted by a 75% growth in the number of physician offices signing on to offer CyPath Lung. This significant expansion not only reflects the increasing recognition of our test’s value in early lung cancer detection but also lays a strong foundation for accelerating sales growth in the coming quarters," bioAffinity President and Chief Executive Officer Maria Zannes said. "With CyPath Lung now being used in 11 states and its recent addition to the U.S. Federal Supply Schedule, we are making meaningful strides in broadening access to this innovative diagnostic tool.
"Our focus remains on expanding our operations and strengthening our foothold in this rapidly growing market," Zannes continued. "Our strategic approach in Texas has resulted in a robust sales and support infrastructure that has us well-equipped to meet rising demand and accelerate our nationwide growth. As we look toward the future, we are confident that these efforts will not only fuel our success but also advance our mission to enhance patient outcomes through groundbreaking, noninvasive cancer diagnostics."
Third Quarter Financial Results
Revenue for the third quarter of 2024 was $2.4 million, compared with $298,000 revenue for the prior-year period. The majority of the year-over-year increase is through the acquisition of Precision Pathology Laboratory Services, LLC (PPLS). Revenue is primarily generated from patient service fees, including billing for CyPath Lung tests, with additional revenues generated from histology service fees and medical director fees.
Research and development expenses were $274,000 for the third quarter of 2024, compared with $330,000 for the comparable period in 2023. The decrease was primarily due to higher R&D laboratory supply and equipment costs following the acquisition of PPLS in the prior year period.
Clinical development expenses were $94,000 for the third quarter of 2024, compared with $106,000 for the third quarter of 2023. The decrease was primarily attributable to higher professional fees in the prior year period related to evaluating the clinical strategy for the Company’s Food and Drug Administration (FDA) pivotal CyPath Lung clinical trial.
Selling, general and administrative expenses were $2.4 million for the third quarter of 2024, compared with $2.0 million for the comparable period in 2023. The increase was primarily attributed to an increase in sales personnel and services to support the launch of CyPath Lung, together with acquired general and administrative costs from PPLS.
Net loss for the third quarter of 2024 was $2.0 million, or $0.16 per share, a $0.3 million improvement from a net loss of $2.3 million, or $0.26 per share, for the comparable period in 2023.
Cash and cash equivalents as of September 30, 2024, were $0.8 million, compared with $2.8 million as of December 31, 2023. Subsequent to the end of the third quarter of 2024, bioAffinity Technologies raised aggregate gross proceeds of $2.7 million in a registered direct offering and concurrent private placement closed on October 21, 2024.