On August 7, 2023 Biodesix, Inc. (Nasdaq: BDSX), a leading data-driven diagnostic solutions company with a focus in lung disease, reported its financial and operating results for the second quarter ended June 30, 2023 and provided a corporate update (Press release, Biodesix, AUG 7, 2023, View Source [SID1234633863]).
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"I am very pleased to announce another record-setting quarter from our core lung diagnostics," said Scott Hutton, President and Chief Executive Officer. "In addition to continued sales growth, we had a number of important publications this past quarter that highlighted the benefits to patient care of our lung diagnostic tests in a real-world, clinical setting.
We are also happy to announce the successful completion of a private placement that included some of our largest shareholders and management. All board members, all Section 16 officers, and additional members of the Biodesix leadership team participated in the round raising $27.5 million in equity funding to further support our growth. We also maintained strong cost discipline, with sustainable and improving gross margins to 73% from 65%, and reducing our Operating Expense excluding direct costs and expenses by $2.7 million, all versus first quarter 2023. We continue to focus on projects and initiatives that drive near term-revenue growth, while reducing expenses and cash burn. Overall, the progress and positive trends in our core lung diagnostics tests in the first half of the year solidifies our confidence in reaffirming our 2023 revenue guidance and making progress on our path to profitability."
Business Highlights
Biodesix continues to publish new data supporting the value and utility of their lung diagnostics portfolio. The Company was pleased to announce the following accomplishments:
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Published the achievement of the primary endpoint of the prospective ORACLE clinical utility study, demonstrating that use of the Nodify XL2 test resulted in a 74% decrease in unnecessary invasive procedures on patients with benign lung nodules compared to the control group;
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Researchers from Beth Israel Deaconess, Tulane University, and Einstein Medical Center published an independent, multi-center study demonstrating that use of the Nodify XL2 test resulted in a 73% reduction in the number of invasive procedures compared to the control arm;
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Presented new health economics data on the Nodify XL2, Nodify CDT, and VeriStrat tests at the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) and the International Society for Pharmaceutical and Outcomes Research (ISPOR). These data indicate savings to the US healthcare system with use of the tests;
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Completed enrollment of 5,000 patients with non-small cell lung cancer (NSCLC) in the large multi-center observational registry study INSIGHT. The study was designed to further validate the utility of the VeriStrat test;
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Announced that CMS has designated the Nodify CDT Test as an Advanced Diagnostic Laboratory Test (ADLT) effective June 30, 2023. ADLT status is reserved for innovative tests with Medicare coverage that provide new clinical diagnostic information that cannot be obtained from any other test or combination of tests.
Second Quarter 2023 Financial Results
For the three-month period ended June 30, 2023, as compared to the same period of 2022 (where applicable):
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Total revenue of $11.9 million, an increase of 8% including COVID testing revenue in second quarter 2022, driven primarily by strong year-over-year growth in core lung diagnostics, and a 48% year-over-year increase excluding COVID testing revenues from the prior year comparison.
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Core lung diagnostic revenue of $11.4 million reflected a year-over-year increase of 58% driven primarily by the continued adoption of Nodify Lung nodule management tests;
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BioPharma Services revenue of $0.4 million decreased 43% year-over-year. Timelines for existing and new agreements continue to be impacted by delayed enrollment in clinical trials; entered the third quarter of 2023 with continued strong dollars under contract;
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COVID-19 testing revenue decreased by 100% year-over-year, the Company no longer provides COVID-19 diagnostic testing services commercially;
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Second quarter 2023 gross profit of $8.6 million, or 73% gross margin as compared to 64% gross margin in the comparable prior year period primarily driven by growth in Lung Diagnostic Testing and optimization of testing workflows that resulted in improvements in costs per test, and the commercial discontinuation of our lower-margin COVID-19 diagnostic testing;
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Operating expenses (excluding direct costs and expenses) of $19.6 million, an increase of approximately $1.0 million, or 5% as compared to the second quarter 2022 (includes non-cash stock compensation expense of $1.1 million as compared to $1.4 million). This increase is primarily attributable to increased sales and marketing costs to support core lung diagnostic sales growth including increased travel-related costs and marketing programs to enhance product awareness as we actively participate in an increasing number of peer-to-peer physician educational events;
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Net loss of $13.4 million, a decrease of approximately $2.5 million, or 16%;
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Cash and cash equivalents of $17.4 million as of June 30, 2023, a decrease of $7.9 million from March 31, 2023. This represented an improvement of approximately 56% in cash utilization versus the cash utilized in the first quarter 2023;
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Scheduled milestone payment of $2.3 million paid in April 2023 to Integrated Diagnostics;
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Subsequent to quarter end, raised $27.5 million in gross equity proceeds from a private placement to be used for commercial expansion of sales, research and development, and for general corporate purposes.
2023 Financial Outlook
The Company reaffirms our 2023 financial outlook and expects to generate between $52 million and $55 million in total revenue in 2023.
Conference call and webcast information
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For a full list of Biodesix’s press releases and webinars, please visit biodesix.com.