On March 31, 2023 bioAffinity Technologies, Inc. (Nasdaq: BIAF; BIAFW), a biotechnology company addressing the need for noninvasive detection of early-stage lung cancer and other diseases of the lung, reported financial results for the three and 12 months ended December 31, 2022 (Press release, BioAffinity Technologies, MAR 31, 2023, View Source [SID1234629736]).

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Financial Highlights

● Raised net proceeds of approximately $6.0 million from an initial public offering (IPO) in September 2022

● Converted nearly $16 million in debt, related accrued interest and fair value adjustments into shares of common stock in connection with the IPO

● Raised an additional $7.8 million from the exercise of warrants and stock options

Corporate and Operational Highlights

● Announced publication in Respiratory Research of an article titled "Detection of early-stage lung cancer in sputum using automated flow cytometry and machine learning" detailing results of bioAffinity Technologies’ clinical validation trial, which showed CyPath Lung had 92% sensitivity and 87% specificity in high-risk patients with nodules smaller than 20 millimeters or no nodules in the lung, with an area under the ROC curve of 94%

● Selected a contract research organization to manage the pivotal trial intending to seek U.S. Food and Drug Administration clearance of CyPath Lung as a Class II IVD medical device for the detection of lung cancer; the pivotal trial is expected to recruit 1,800 patients beginning in 2023, with participants followed for at least one year to determine the presence of lung cancer

● Research continues aimed at the expansion of the Company’s flow cytometric platform technology for use in detecting additional lung diseases, including Chronic Obstructive Pulmonary Disease (COPD)

● Announced publication in the Journal of Visualized Experiments of an article titled "Porphyrin-Modified Beads for Use as Compensation Controls in Flow Cytometry" describing the beads engineered by the Company for use with its CyPath Lung test

● Received Notice of Allowance for a U.S. patent protecting the targeted delivery of novel cancer treatments using porphyrin compounds for bioAffinity Technologies’ wholly owned subsidiary, OncoSelect Therapeutics

● Awarded therapeutic patents in China, Mexico and Australia for compounds comprised of porphyrins conjugated to chemotherapeutic agents that can provide selective treatment for cancer; the Company’s global patent portfolio now includes the U.S., Australia, Canada, China, France, Germany, Hong Kong, Italy, Mexico, Spain, Sweden and the United Kingdom

● Expanded the Company’s Scientific and Medical Advisory Board with the appointments of Sheila Habib, M.D., Director of the Pulmonary Lung Nodule Clinic and the Lung Cancer Screening Program at South Texas Veterans Health Care, and David Hill, M.D., National Board Member of the American Lung Association and assistant clinical professor of medicine at Yale University School of Medicine

● Strengthened the diagnostics division with the appointment of Rossella Titone, Ph.D., and Alvaro Souto Padron de Figueiredo, Ph.D., who bring significant technical expertise in flow cytometry and clinical research across various cancers

● Appointed Julie Anne Overton, a veteran of print and broadcast journalism, corporate communications and federal public affairs, as Director of Communications

● Scheduled to ring the Nasdaq closing bell on April 5 to commemorate the Company’s 2022 IPO

Management Commentary

"Through the capital raised during and following our IPO, 2022 was a landmark year for bioAffinity Technologies as we executed on our goal to become a leader in non-invasive early-stage cancer diagnosis by bringing our first flow cytometry-based diagnostic, CyPath Lung, to market. With key research and leadership appointments, we are engaging clinicians and patients on the value of early lung cancer screening, lowering healthcare costs and raising the survival rate for one of the deadliest cancers," said Maria Zannes, President and Chief Executive Officer of bioAffinity Technologies.

Low-dose computed tomography (LDCT) is the standard of care for screening patients at high risk for lung cancer and can significantly increase survival by finding early-stage cancer. But screening’s low positive predictive rate of 3.8% means that only four people out of 100 who get a positive screening result will actually have lung cancer. CyPath Lung assists clinical decision-making for patients whose screening results are not clear. Physicians can order bioAffinity’s patient-friendly CyPath Lung test to confirm or rule out cancer, reducing the need for biopsy and other costly invasive procedures, and providing greater clarity to determine next steps in patient care.

"Our ongoing pilot launch of CyPath Lung in Texas continues to provide value by helping us to refine positioning, gather valuable insights from labs and healthcare providers, and optimize logistics throughout the care pathway, from ordering the test to reporting results. By building upon real-world feedback from this test market, we are enhancing the value proposition of CyPath Lung and can achieve more impactful adoption as we prepare for commercial expansion," Ms. Zannes said.

Fourth Quarter Financial Results

Revenue for the fourth quarter of 2022 was approximately $2,500, compared with no revenue for the prior-year period. Revenue was derived from the sale of CyPath Lung as a Laboratory Developed Test (LDT).

Research and development expenses were $429,000 for the fourth quarter of 2022, compared with $318,000 for the comparable period in 2021. General and administrative expenses were $1.2 million for the fourth quarter of 2022, compared with $341,000 for the comparable period in 2021.

Net loss for the fourth quarter of 2022 was $1.7 million, compared with a net loss of $5.6 million for the comparable period in 2021.

Full Year Financial Results

Revenue for 2022 was approximately $5,000, compared with no revenue for 2021.

Research and development expenses were $1.1 million in 2022, compared with $1.0 million in 2021. The increase was primarily due to higher personnel, legal and research costs, partially offset by lower stock-based compensation expense.

General and administrative expenses were $2.7 million in 2022, compared with $1.1 million in 2021. The increase was primarily due to higher consulting, legal and professional fees related to the Company’s IPO and compliance with public company reporting requirements. The increase was also attributed to higher stock-based compensation expense, as well as hiring-related expenses to support the commercial launch of CyPath Lung.

Net loss for 2022 was $8.2 million, or $1.81 per share, compared with a net loss for 2021 of $6.3 million, or $2.36 per share.

Cash and cash equivalents as of December 31, 2022, were $11.4 million. On September 6, 2022, bioAffinity Technologies raised net proceeds of $6.0 million from an IPO of 1,282,600 units, with each unit consisting of one share of common stock, one tradeable warrant to purchase one share of common stock and one non-tradable warrant. An additional $7.8 million was raised from the exercise of warrants and options. bioAffinity Technologies believes that its available cash will be sufficient to fund planned operations for at least the next 12 months.

Conference Call and Webcast

Management will host a conference call on Monday, April 3, 2023, at 9:00 a.m. Eastern time to discuss those results and answer questions.

Date: Monday, April 3, 2023
Time: 9:00 a.m. Eastern time
Toll Free: 877-270-2148
International: 412-902-6510
Webcast: Webcast link

A replay of the event will be available for 90 days at the webcast link above, which can also be found in the Investor Relations section of bioAffinity Technologies’ website at ir.bioaffinitytech.com.