EX-99.1 2 ex99-1.htm

 

Exhibit 99.1

 

ONCOCYTE REPORTS SECOND QUARTER 2023 FINANCIAL RESULTS

 

Conference Call on Thursday, August 10, 2023 at 5:00 a.m. PT / 8:00 a.m. ET

 

IRVINE, Calif., August 10, 2023 (GLOBE NEWSWIRE) — Oncocyte Corporation (Nasdaq: OCX), a precision diagnostics company, today reported financial results for the second quarter of 2023, ended June 30, 2023.

 

Second Quarter and Recent Highlights

 

  ● Transplant product launch on pace for Q4 early access. Manufacturing transfer process for 48-target universal assay began in June
  ● Expanding clinical utility for VitaGraft Kidney, a recent peer-reviewed publication in Kidney International Reports showed ability to identify ABMR and differentiate it from IgA Nephropathy
  ● Landmark randomized triple negative breast cancer study of DetermaIO in patients treated with Keytruda in the adjuvant setting continues to progress
  ● Cash, cash equivalents, and marketable securities totaled $17.9 million at June 30, 2023, with average cash burn projected to drop below $5 million a quarter in 2H 2023

 

“In the second quarter, we made significant progress towards the development and manufacturing of our Transplant product for institutions conducting research on the use of cfDNA monitoring post-transplantation,” said Josh Riggs, CEO of Oncocyte. “We look forward to serving the global transplant community with our patented technology and expect to meet our target of early access launch by the end of this year. On the clinical front, our transplant and oncology laboratory tests continue their review process with MolDX as they are evaluated for potential coverage. Amongst the potential coverage decisions, ongoing clinical studies and operational improvements, we believe that Oncocyte is positioned for success with several value creating milestones achievable in the second half of this year.”

 

Second Quarter 2023 Financial Results

 

Consolidated revenues for the second quarter of 2023 were approximately $0.5 million, and cost of revenues for the second quarter were approximately $0.2 million, primarily from services customers.

 

 

 

 

Net consolidated operating loss for the three months ended June 30, 2023, was $8.3 million, compared to consolidated operating loss of $8.6 million, a decrease of $0.3 million from the same period in the prior year.

 

Consolidated research and development expense for the second quarter decreased 56% year-over-year from $5.6 million to $2.4 million driven by focused investment in developing manufacturable versions of our assays.

 

Consolidated general and administrative expense for the second quarter decreased 36% year-over-year from $5.5 million to $3.5 million, reflecting management’s efforts to control spending not directly related to product development or commercial activities.

 

Consolidated sales and marketing expense for the second quarter decreased 77% year over year from $3.5 million to $0.8 million. We focused on our early access programs and early market access work for our laboratory tests and research products.

 

For Oncocyte’s complete financial results for the second quarter ended June 30, 2023, see the Company’s Quarterly Form 10-Q to be filed with the Securities and Exchange Commission on Aug 10, 2023.

 

Webcast and Conference Call Information

 

Oncocyte will host a conference call to discuss the first quarter 2023 financial results prior to market open on Thursday, August 10, 2023 at 5:00 a.m. Pacific Time / 8:00 a.m. Eastern Time. The conference call may be accessed live via telephone by dialing (877) 317-6789 for domestic callers or (412) 317-6789 for international callers. Once dialed in, ask to be joined to the Oncocyte Corporation call. The live webinar of the call may be accessed by visiting the “Events & Presentation” section of the Company’s website at https://investors.oncocyte.com.

 

About Oncocyte

 

Oncocyte is a precision diagnostics company. The Company’s tests are designed to help provide clarity and confidence to physicians and their patients. DetermaIO™ is a gene expression test that assesses the tumor microenvironment in order to predict response to immunotherapies. VitaGraft™ is a blood-based solid organ transplantation monitoring test, and pipeline test DetermaCNI™ is a blood-based monitoring tool for monitoring therapeutic efficacy. For more information, visit www.oncocyte.com

 

DetermaIO™, DetermaCNI™, and VitaGraft™ are trademarks of Oncocyte Corporation.

 

 

 

 

Forward-Looking Statements

 

Any statements that are not historical fact (including, but not limited to statements that contain words such as “will,” “believes,” “plans,” “anticipates,” “expects,” “estimates,” “may,” and similar expressions) are forward-looking statements. These statements include those pertaining to, among other things, the expectation that the Company’s transplant product launch is on pace for Q4 2023 early access, the projection that average cash burn will drop below $5 million a quarter in 2H 2023, the anticipation of potential coverage from MolDX for our transplant and oncology laboratory tests, the expectation that Oncocyte is positioned to achieve several value creating milestones in the second half of this year, and other statements about the future expectations, beliefs, goals, plans, or prospects expressed by management. Forward-looking statements involve risks and uncertainties, including, without limitation, the potential impact of COVID-19 on Oncocyte or its subsidiaries’ financial and operational results, risks inherent in the development and/or commercialization of diagnostic tests or products, uncertainty in the results of clinical trials, changes to regulatory oversight and/or regulatory approvals, the capacity of Oncocyte’s third-party supplied blood sample analytic system to provide consistent and precise analytic results on a commercial scale, potential interruptions to supply chains, the need and ability to obtain future capital, maintenance of intellectual property rights in all applicable jurisdictions, obligations to third parties with respect to licensed or acquired technology and products, the need to obtain third party reimbursement for patients’ use of any diagnostic tests. Oncocyte or its subsidiaries commercialize in applicable jurisdictions, and risks inherent in strategic transactions such as the potential failure to realize anticipated benefits, legal, regulatory or political changes in the applicable jurisdictions, accounting and quality controls, potential greater than estimated allocations of resources to develop and commercialize technologies, or potential failure to maintain any laboratory accreditation or certification. Actual results may differ materially from the results anticipated in these forward-looking statements and accordingly such statements should be evaluated together with the many uncertainties that affect the business of Oncocyte, particularly those mentioned in the “Risk Factors” and other cautionary statements found in Oncocyte’s Securities and Exchange Commission (SEC) filings, which are available from the SEC’s website. You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they were made. Oncocyte undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law.

 

CONTACT:

Stephanie Prince

PCG Advisory

(646) 863-6341

sprince@pcgadvisory.com

 

 

 

 

ONCOCYTE CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

 

   June 30,   December 31, 
   2023   2022 
   (unaudited)      
ASSETS          
CURRENT ASSETS          
Cash and cash equivalents  $17,368   $19,993 
Accounts receivable, net of allowance of $178 and $154, respectively   1,716    2,012 
Marketable equity securities   530    433 
Prepaid expenses and other current assets   1,179    977 
Assets held for sale   191    - 
Current assets of discontinuing operations   -    2,121 
Total current assets   20,984    25,536 
           
NONCURRENT ASSETS          
Right-of-use and financing lease assets, net   1,891    2,088 
Machinery and equipment, net, and construction in progress   5,997    8,763 
Intangible assets, net   56,639    61,633 
Restricted cash   1,700    1,700 
Other noncurrent assets   329    371 
TOTAL ASSETS  $87,540   $100,091 
           
LIABILITIES AND SHAREHOLDERS’ EQUITY          
CURRENT LIABILITIES          
Accounts payable  $875   $1,253 
Accrued compensation   1,301    1,771 
Accrued expenses and other current liabilities   2,196    3,839 
Accrued severance from acquisition   2,314    2,314 
Accrued liabilities from acquisition   109    109 
Right-of-use and financing lease liabilities, current   737    815 
Current liabilities of discontinuing operations   135    2,005 
Total current liabilities   7,667    12,106 
           
NONCURRENT LIABILITIES          
Right-of-use and financing lease liabilities, noncurrent   2,398    2,729 
Contingent consideration liabilities   29,150    45,662 
           
TOTAL LIABILITIES   39,215    60,497 
           
Commitments and contingencies          
           
Series A Redeemable Convertible Preferred Stock, no par value; stated value $1,000 per share; 5 and 6 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively; aggregate liquidation preference of $5,140 and $6,091 as of June 30, 2023 and December 31, 2022, respectively   4,725    5,302 
           
SHAREHOLDERS’ EQUITY          
Preferred stock, no par value, 5,000 shares authorized; no shares issued and outstanding   -    - 
Common stock, no par value, 230,000 shares authorized; 8,241 and 5,932 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively   309,535    294,929 
Accumulated other comprehensive income   41    39 
Accumulated deficit   (265,976)   (260,676)
Total shareholders’ equity   43,600    34,292 
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY  $87,540   $100,091 

 

 
 

 

ONCOCYTE CORPORATION

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

 

   Three Months Ended   Six Months Ended 
   June 30,   June 30, 
   2023   2022   2023   2022 
                 
NET REVENUE  $463   $237   $760   $617 
                     
Cost of revenues   169    183    434    288 
Cost of revenues – amortization of acquired intangibles   22    23    44    51 
Gross profit   272    31    282    278 
                     
OPERATING EXPENSES                    
Research and development   2,435    2,444    4,562    4,451 
Sales and marketing   805    127    1,500    393 
General and administrative   3,531    5,445    6,943    11,092 
Change in fair value of contingent consideration   1,795    (6,359)   (16,512)   (11,015)
Impairment loss from intangible assets   -    -    4,950    - 
Loss on disposal and held for sale assets   -    -    1,283    - 
Total operating expenses   8,566    1,657    2,726    4,921 
                     
Loss from operations   (8,294)   (1,626)   (2,444)   (4,643)
                     
OTHER INCOME (EXPENSES), NET                    
Interest income (expenses), net   1    (21)   (9)   (51)
Unrealized gain (loss) on marketable equity securities   (24)   5    97    (325)
Other income (expenses), net   (16)   278    (18)   242 
Total other income (expenses), net   (39)   262    70    (134)
                     
LOSS BEFORE INCOME TAXES   (8,333)   (1,364)   (2,374)   (4,777)
                     
Loss from continuing operations   (8,333)   (1,364)   (2,374)   (4,777)
Loss from discontinuing operations   -    (6,936)   (2,926)   (13,814)
                     
NET LOSS  $(8,333)  $(8,300)  $(5,300)  $(18,591)
                     
LESS: DIVIDENDS AND ACCRETION OF SERIES A REDEEMABLE CONVERTIBLE PREFERRED STOCK   (311)   (72)   (541)   (72)
                     
NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS: BASIC AND DILUTED  $(8,644)  $(8,372)  $(5,841)  $(18,663)
                     
Net loss from continuing operations per share: basic and diluted  $(1.03)  $(0.24)  $(0.34)  $(0.93)
Net loss from discontinuing operations per share: basic and diluted  $-   $(1.23)  $(0.42)  $(2.69)
Net loss per share: basic and diluted  $(1.07)  $(1.48)  $(0.83)  $(3.63)
                     
Weighted average shares outstanding: basic and diluted   8,090    5,652    7,030    5,135 

 

 
 

 

Oncocyte Corporation

 

Reconciliation of Non-GAAP Financial Measure

Consolidated Adjusted Loss from Operations

(Amounts in Thousands)

 

   For the Three Months Ended 
   June 30,   March 31,   June 30, 
   2023   2023   2022 
   (unaudited)   (unaudited)   (unaudited) 
Consolidated GAAP loss from operations  $(8,294)  $2,924   $(8,562)
Stock-based compensation expense   834    834    2,232 
Change in fair value of contingent consideration   1,795    (18,307)   (6,359)
Severance charge   604    14    143 
Depreciation and amortization expense   457    472    1,360 
Loss on disposal and held for sale assets   -    1,335    - 
Impairment loss   -    4,950    - 
Consolidated Non-GAAP loss from operations, as adjusted  $(4,604)  $(7,778)  $(11,186)