Post by icemandios on May 10, 2022 23:45:52 GMT
OraSure Reports 1Q22 Record Revenue of $67.7 Million; +16% Year-Over-Year With 21% Growth in Non-COVID Revenue
InteliSwab ® revenue of $22.1 million in Q1, up 50% sequentially with significant scaling in production
Non-COVID molecular kits increase 42% year-over-year demonstrating continued strong growth
Management to Host Analyst/Investor Call and Webcast Today at 5:00 p.m. ET
BETHLEHEM, Pa., May 10, 2022 (GLOBE NEWSWIRE) -- OraSure Technologies, Inc. (NASDAQ: OSUR), a leader in point-of-care and home diagnostic tests, specimen collection devices, and microbiome laboratory and analytical services, today announced its financial results for the three months ended March 31, 2022.
“We made significant progress in the quarter scaling InteliSwab® production and improving the efficiency of our manufacturing process as we look to drive profitable growth,” said OraSure Interim President and CEO Nancy J. Gagliano, M.D., MBA. “Excluding COVID-19 products, both our Diagnostics and Molecular Solutions businesses grew at a double-digit rate year-over-year.”
She continued, “We once again saw exceptionally strong demand for our molecular kits business, with our non-COVID-19 core collection kit business growing 36% versus the same quarter a year ago. We also continue to launch innovative offerings such as our first-of-its-kind U.S. Food and Drug Administration (FDA) de novo authorized microbiome gut collection kit and our new metatranscriptome services offering, with new offerings to be launched this quarter. In addition, we continue to expand our market coverage with our base of active purchasing Molecular Solutions customers growing 6% in the quarter, positioning us for continued long-term growth.”
Financial Highlights
Net revenues for the first quarter of 2022 were $67.7 million, a 16% increase from the first quarter of 2021 and a new record for the Company. Excluding COVID-19 product revenues, revenues for the quarter increased 21% year-over-year.
Total revenues from the Company’s Diagnostic business unit were $38.3 million during the first quarter of 2022 and grew 163% relative to the same period last year. Revenue growth was driven primarily by InteliSwab®. Excluding InteliSwab® sales, total Diagnostic business unit revenue grew 11% year-over-year.
Total product and service revenues for the Company’s Molecular Solutions business unit were $29.4 million during the first quarter of 2022, a decline of 33% from the first quarter of 2021. The decline was driven entirely by lower sales of the Company’s COVID-19 molecular collection kits given the expected transition to point of care solutions, as well as customers working through high inventory levels. Excluding these COVID-19 revenues, the molecular solutions business grew 28% year-over-year.
Gross margin in the first quarter was 36% and was negatively impacted by one-time InteliSwab® manufacturing costs including high scrap rates during the quarter and under-absorption as the Company worked to scale InteliSwab® production. Additionally, average selling prices for InteliSwab® declined on a sequential basis as the mix of the first quarter revenue was primarily related to the Company’s government procurement contract compared to fourth quarter 2021 revenue which consisted of predominantly commercial sales. Furthermore, product mix drove declining margins with more revenue coming from the Company’s Diagnostic business unit, as well as lower revenues from higher margin COVD-19 collection kits. In addition, gross margin was negatively impacted by the expiration of subsidies for the international sale of our HIV Self-Test under the charitable support agreement with the Gates Foundation ,which expired in June 2021. The Company currently has a number of programs in place which are intended to improve gross margins including efficiency programs associated with production, changes in logistical processes, product packaging redesign, and supply chain consolidation.
Operating loss in the first quarter was ($16.0) million compared to operating income of $10.4 million in the first quarter of last year. OraSure’s operating loss in the quarter was driven by an increase in investments to support the InteliSwab ® scale-up, one-time production inefficiencies, continued development, and approximately $4.9 million in one-time expenses tied to the company’s strategic alternative process and CEO transition.
Cash flow used in operations in the quarter was ($35.8) million which was impacted by working capital changes due to increases in accounts receivable and inventory levels associated with the InteliSwab® scale up. Cash and investments totaled $112.2 million at March 31, 2022. As of March 31, 2022, the Company also had approximately $16.9 million in funds committed to the capacity expansion build out associated with the Department of Defense contract which will be reimbursed in future periods.
Recent Business Highlights
InteliSwab ® COVID-19 Testing
InteliSwab® revenue in the quarter grew to $22.1 million representing over 50% sequential growth relative to the fourth quarter.
Production volumes of InteliSwab® scaled dramatically during the first quarter. In early April, the company demonstrated the ability to produce tests at volume equivalent to the Company’s installed capacity representing over a four-fold increase from production levels in early January. During the quarter, the company resolved major production issues and is now in full production phase.
The Company has been highly focused on improving production efficiencies as well. Finished goods scrap rates for InteliSwab declined to less than 1% by late March from over 30% in early January.
OraSure announced that the InteliSwab® COVID-19 rapid tests detect the Omicron variant with similar limits of detection to the original SARS-CoV-2 strain and other previous variants of concern, including Delta, Alpha, Beta and Gamma.
Diagnostics Business Results (excluding InteliSwab®)
Excluding InteliSwab ® revenue, the Diagnostics legacy revenue was $16.2M and grew 11% compared to the prior year quarter.
International Diagnostics revenue was $5.6M in Q1, a20% increase compared to the prior year period. Excluding the impact of the Bill and Melinda Gates Foundation subsidy expiry in June 2021, the business grew 34% year-over-year.
U.S. Diagnostics revenue, excluding InteliSwab ® , was $10.5M and grew 7% year-over-year despite lapping the Q1 2021 Center for Disease Control’s, “Let’s Stop HIV Together,” home testing program which was not repeated this quarter.
The Company launched the OraQuick® HIV Self-Test, an oral swab in-home test for HIV-1 and HIV-2, into Europe. The test will be available in six European countries: United Kingdom, Germany, France, Italy, Spain and Portugal.
Molecular Solutions
Genomics collection kit revenue of $15.1 million for the first quarter of 2022 grew 40% year-over-year.
Sales of OraSure’s sample collection devices for molecular/PCR COVID-19 testing decreased 68% year-over-year to $8.9 million in the first quarter of 2022 compared to $28.0 million in the prior year period. The decline in revenue is attributable to lower testing volumes with core customers as the market transitions to point-of-care solutions such as rapid antigen tests and customers work through current inventory levels of collection kits.
Total microbiome revenue, including kits and services, was $3.7 million in the quarter and declined 12% relative to the first quarter of last year. During the quarter, services revenue was negatively impacted by the delayed timing of customer clinical trials. Microbiome collection kits grew 14% in Q1 compared to the prior year.
Received U.S. Food and Drug Administration (FDA) de novo authorization for the OMNIgene ® ·GUT Dx (OMD-200) microbiome collection device and commercially launched the product. OMNIgene ® ·GUT Dx is the first FDA approved collection kit specifically targeted to the collection of stool-based microbiome samples.
Launched a new service to provide metatranscriptomic sequencing and analysis of gut microbiome samples through the Company’s Diversigen subsidiary. As part of the launch, the company created a comprehensive, curated database with more than 190,000 genomes, representing 31,000 species of microbes, to allow profiling of microbial gene expression, including functional modules and pathways. Metatranscriptomic sequencing provides powerful insights not possible with other sequencing technologies.
Strategic Alternatives Review and CEO Search
On January 5, 2022, the Company announced it is exploring strategic alternatives. The review is ongoing, and no decisions have been made.
Consistent with the first quarter, OraSure will not be providing guidance for the second quarter given the ongoing strategic alternative process.
Additionally, the company has hired an external search firm and is in the process of looking for a permanent chief executive officer. Dr. Nancy J. Gagliano has been appointed as interim President and CEO by the Board of Directors and is not a candidate for the full-time position.
InteliSwab ® revenue of $22.1 million in Q1, up 50% sequentially with significant scaling in production
Non-COVID molecular kits increase 42% year-over-year demonstrating continued strong growth
Management to Host Analyst/Investor Call and Webcast Today at 5:00 p.m. ET
BETHLEHEM, Pa., May 10, 2022 (GLOBE NEWSWIRE) -- OraSure Technologies, Inc. (NASDAQ: OSUR), a leader in point-of-care and home diagnostic tests, specimen collection devices, and microbiome laboratory and analytical services, today announced its financial results for the three months ended March 31, 2022.
“We made significant progress in the quarter scaling InteliSwab® production and improving the efficiency of our manufacturing process as we look to drive profitable growth,” said OraSure Interim President and CEO Nancy J. Gagliano, M.D., MBA. “Excluding COVID-19 products, both our Diagnostics and Molecular Solutions businesses grew at a double-digit rate year-over-year.”
She continued, “We once again saw exceptionally strong demand for our molecular kits business, with our non-COVID-19 core collection kit business growing 36% versus the same quarter a year ago. We also continue to launch innovative offerings such as our first-of-its-kind U.S. Food and Drug Administration (FDA) de novo authorized microbiome gut collection kit and our new metatranscriptome services offering, with new offerings to be launched this quarter. In addition, we continue to expand our market coverage with our base of active purchasing Molecular Solutions customers growing 6% in the quarter, positioning us for continued long-term growth.”
Financial Highlights
Net revenues for the first quarter of 2022 were $67.7 million, a 16% increase from the first quarter of 2021 and a new record for the Company. Excluding COVID-19 product revenues, revenues for the quarter increased 21% year-over-year.
Total revenues from the Company’s Diagnostic business unit were $38.3 million during the first quarter of 2022 and grew 163% relative to the same period last year. Revenue growth was driven primarily by InteliSwab®. Excluding InteliSwab® sales, total Diagnostic business unit revenue grew 11% year-over-year.
Total product and service revenues for the Company’s Molecular Solutions business unit were $29.4 million during the first quarter of 2022, a decline of 33% from the first quarter of 2021. The decline was driven entirely by lower sales of the Company’s COVID-19 molecular collection kits given the expected transition to point of care solutions, as well as customers working through high inventory levels. Excluding these COVID-19 revenues, the molecular solutions business grew 28% year-over-year.
Gross margin in the first quarter was 36% and was negatively impacted by one-time InteliSwab® manufacturing costs including high scrap rates during the quarter and under-absorption as the Company worked to scale InteliSwab® production. Additionally, average selling prices for InteliSwab® declined on a sequential basis as the mix of the first quarter revenue was primarily related to the Company’s government procurement contract compared to fourth quarter 2021 revenue which consisted of predominantly commercial sales. Furthermore, product mix drove declining margins with more revenue coming from the Company’s Diagnostic business unit, as well as lower revenues from higher margin COVD-19 collection kits. In addition, gross margin was negatively impacted by the expiration of subsidies for the international sale of our HIV Self-Test under the charitable support agreement with the Gates Foundation ,which expired in June 2021. The Company currently has a number of programs in place which are intended to improve gross margins including efficiency programs associated with production, changes in logistical processes, product packaging redesign, and supply chain consolidation.
Operating loss in the first quarter was ($16.0) million compared to operating income of $10.4 million in the first quarter of last year. OraSure’s operating loss in the quarter was driven by an increase in investments to support the InteliSwab ® scale-up, one-time production inefficiencies, continued development, and approximately $4.9 million in one-time expenses tied to the company’s strategic alternative process and CEO transition.
Cash flow used in operations in the quarter was ($35.8) million which was impacted by working capital changes due to increases in accounts receivable and inventory levels associated with the InteliSwab® scale up. Cash and investments totaled $112.2 million at March 31, 2022. As of March 31, 2022, the Company also had approximately $16.9 million in funds committed to the capacity expansion build out associated with the Department of Defense contract which will be reimbursed in future periods.
Recent Business Highlights
InteliSwab ® COVID-19 Testing
InteliSwab® revenue in the quarter grew to $22.1 million representing over 50% sequential growth relative to the fourth quarter.
Production volumes of InteliSwab® scaled dramatically during the first quarter. In early April, the company demonstrated the ability to produce tests at volume equivalent to the Company’s installed capacity representing over a four-fold increase from production levels in early January. During the quarter, the company resolved major production issues and is now in full production phase.
The Company has been highly focused on improving production efficiencies as well. Finished goods scrap rates for InteliSwab declined to less than 1% by late March from over 30% in early January.
OraSure announced that the InteliSwab® COVID-19 rapid tests detect the Omicron variant with similar limits of detection to the original SARS-CoV-2 strain and other previous variants of concern, including Delta, Alpha, Beta and Gamma.
Diagnostics Business Results (excluding InteliSwab®)
Excluding InteliSwab ® revenue, the Diagnostics legacy revenue was $16.2M and grew 11% compared to the prior year quarter.
International Diagnostics revenue was $5.6M in Q1, a20% increase compared to the prior year period. Excluding the impact of the Bill and Melinda Gates Foundation subsidy expiry in June 2021, the business grew 34% year-over-year.
U.S. Diagnostics revenue, excluding InteliSwab ® , was $10.5M and grew 7% year-over-year despite lapping the Q1 2021 Center for Disease Control’s, “Let’s Stop HIV Together,” home testing program which was not repeated this quarter.
The Company launched the OraQuick® HIV Self-Test, an oral swab in-home test for HIV-1 and HIV-2, into Europe. The test will be available in six European countries: United Kingdom, Germany, France, Italy, Spain and Portugal.
Molecular Solutions
Genomics collection kit revenue of $15.1 million for the first quarter of 2022 grew 40% year-over-year.
Sales of OraSure’s sample collection devices for molecular/PCR COVID-19 testing decreased 68% year-over-year to $8.9 million in the first quarter of 2022 compared to $28.0 million in the prior year period. The decline in revenue is attributable to lower testing volumes with core customers as the market transitions to point-of-care solutions such as rapid antigen tests and customers work through current inventory levels of collection kits.
Total microbiome revenue, including kits and services, was $3.7 million in the quarter and declined 12% relative to the first quarter of last year. During the quarter, services revenue was negatively impacted by the delayed timing of customer clinical trials. Microbiome collection kits grew 14% in Q1 compared to the prior year.
Received U.S. Food and Drug Administration (FDA) de novo authorization for the OMNIgene ® ·GUT Dx (OMD-200) microbiome collection device and commercially launched the product. OMNIgene ® ·GUT Dx is the first FDA approved collection kit specifically targeted to the collection of stool-based microbiome samples.
Launched a new service to provide metatranscriptomic sequencing and analysis of gut microbiome samples through the Company’s Diversigen subsidiary. As part of the launch, the company created a comprehensive, curated database with more than 190,000 genomes, representing 31,000 species of microbes, to allow profiling of microbial gene expression, including functional modules and pathways. Metatranscriptomic sequencing provides powerful insights not possible with other sequencing technologies.
Strategic Alternatives Review and CEO Search
On January 5, 2022, the Company announced it is exploring strategic alternatives. The review is ongoing, and no decisions have been made.
Consistent with the first quarter, OraSure will not be providing guidance for the second quarter given the ongoing strategic alternative process.
Additionally, the company has hired an external search firm and is in the process of looking for a permanent chief executive officer. Dr. Nancy J. Gagliano has been appointed as interim President and CEO by the Board of Directors and is not a candidate for the full-time position.