OraSure Reports Fourth Quarter and Full Year Loss | Lehigh Valley Regional News

BETHLEHEM, Pa. – What next for OraSure Technologies?

On January 5, the Bethlehem-based maker of point-of-care and home diagnostic tests announced organizational changes, including the resignation at the end of March of Stephen Tang, Ph.D., president and chief executive officer. In addition, the company said it would conduct a board-level review of strategic alternatives designed to improve shareholder value.

On Wednesday, OraSure released its fourth-quarter and full-year 2021 results. The company met its fourth-quarter and full-year revenue guidance released in October, but saw a significant drop in earnings per share. OraSure stock is down 43% over the past year, while the S&P 500 is up 18.7%. Today, OraSure stock is down almost 4.5%.

On the positive side, OraSure announced that it has received Emergency Use Authorizations (EUAs) from the Food and Drug Administration for its InteliSwab tests for children ages 2-14 and for a reporting application called InteliSwab® Connect. InteliSwab® is OraSure’s rapid COVID-19 antigen test.

These developments still leave the future uncertain for OraSure. And Tang told analysts during the earnings webcast, “Until the board makes a decision, we will not comment.” Additionally, while the strategic review is ongoing, the company is not providing financial guidance for fiscal year 2022 or the first quarter of 2022. According to Scott Gleason, interim chief financial officer, “We will reinstate financial guidance at outcome of our strategic review process. »

The news regarding InteliSwab® is undoubtedly positive, but so far OraSure cannot ship enough. According to the company, these simple COVID-19 lateral flow tests use self-collected samples from the lower nostrils. The unique InteliSwab® design incorporates an integrated swab fully integrated into the test stick. After users swab their lower nostrils, the test stick is swirled in a pre-measured buffer solution, and the result appears directly on the test stick within 30 minutes, without instruments, batteries, smartphones, or lab analysis. necessary to see the result, the claims of the company.

Emergency use of this product has been authorized only for the detection of SARS-CoV-2 proteins, and not for other viruses or pathogens. The product is authorized only for the duration of the period in which the circumstances justifying the authorization exist.

CEO Comments

“We are delighted to have generated record revenues from our Diagnostics and Molecular Solutions business units in our fiscal year 2021,” said Tang. “InteliSwab® is an exceptional product in terms of simplicity and accuracy, and we are excited about its growth potential. OraSure has confirmed by an independent external laboratory that InteliSwab® detects the live variant of Omicron at the same level as other variants of concern.

Dr. Tang continued, “We continue to ramp up production of InteliSwab®, which includes plans to commission additional production sites. We continue to experience many of the typical challenges associated with scaling, which will take time to fully implement. Even so, we expect InteliSwab to move modestly in the first quarter and then more significantly throughout the year.

Financial Highlights

Net revenue for the fourth quarter of 2021 was $63.6 million, an increase of 1% over the fourth quarter of 2020. Excluding COVID-19 product revenue, revenue for the quarter increased by 3 % year over year.

Total revenue for the company’s Diagnostics business unit was $32.7 million during the fourth quarter of 2021 and increased 58% over the same period last year. Revenue growth was entirely driven by the year-over-year increase in InteliSwab® revenue.

OraSure’s Molecular Solutions business unit total product and services revenue was $30.9 million in the fourth quarter of 2021, down 27% from the fourth quarter of 2020 This decline is entirely due to lower sales of the company’s COVID-19 molecular collection kits. . Excluding these COVID-19-related revenues, the molecular solutions business grew 19% year-over-year despite changes in the ordering habits of the company’s direct customers.

Gross margin percentage in the fourth quarter was 42.7%, compared to 60.7% a year earlier. Gross margins were negatively impacted by inefficiencies in InteliSwab’s manufacturing process as the company worked to start and expand process automation.

The fourth quarter operating loss was $9.4 million, compared to an operating profit of $7.9 million in the fourth quarter last year. OraSure’s operating loss in the quarter was driven by increased capital expenditure to support the launch of InteliSwab, as well as lower gross margins. On a sequential basis, operating income improved by $3.6 million.

Net loss for the fourth quarter of 2021 was $10.4 million, or $0.14 per share on a fully diluted basis, compared to net income of $1.9 million, or $0.03 $ per share on a fully diluted basis for the fourth quarter of 2020. As of December 31, 2021, the Company also had $10.9 million of committed capacity expansion funds associated with the Department of Defense contract for InteliSwab which is expected to be repaid in the first quarter of fiscal 2022.

Recent Industry Highlights

Business Diagnosis

Orasure’s diagnostics segment includes rapid tests for COVID-19, HIV, hepatitis C, Ebola and workplace drug use.

InteliSwab’s fourth quarter revenue reached $14.7 million, representing 92% sequential growth over the third quarter. OraSure has increased its weekly manufacturing output for InteliSwab.

At the end of the fourth quarter, OraSure restructured its business units to vertically integrate operations within them and appointed a president with a proven track record of successfully leading large-scale manufacturing operations. Additionally, OraSure announced that the InteliSwab® COVID-19 rapid tests detect the Omicron variant as effectively as they detect the original SARS-CoV-2 strain and other previous variants of concern, including Delta, Alpha, Beta and Gamma.

Sales of OraQuick HIV in the fourth quarter were $12.4 million compared to $15.2 million in the same period a year earlier. The decline in revenues is mainly attributable to the overseas market, which was affected by two factors. First, international HIV revenues were negatively impacted by the expiration of the Bill and Melinda Gates Foundation testing grant that occurred in June 2021. Second, the global coronavirus pandemic has created logistical delays in the shipment of HIV self-tests to many countries.

The company launched in Europe the OraQuick® HIV self-test, a home oral swab test for HIV-1 and HIV-2. The test will be available in six European countries: UK, Germany, France, Italy, Spain and Portugal.

Global sales of OraQuick® HCV increased 7% to $2.4 million in the fourth quarter from $2.2 million in the fourth quarter of 2020. Risk assessment testing revenue was flat year-over-year to $2.4 million, primarily due to increased drug abuse in the workplace. testing offset by continued challenges in insurance testing given the COVID-19 pandemic.

Molecular Solutions Company

The Molecular Solutions segment includes genomics, PCR testing for COVID-19 and gut microbiome testing.

Genomics Collection Kits revenue of $14.0 million for the fourth quarter of 2021 increased 3% year-over-year despite changes in ordering habits, many companies Directly speaking to consumers purchasing larger quantities of kits in Q3 ahead of the Q4 promotional season.

Full-year genomic kits revenue increased 72% to $63.4 million, demonstrating strong growth in existing customers, expansion of new customers and recovery in clinical markets and academics after the global pandemic.

Sales of OraSure’s specimen collection devices for molecular testing/PCR COVID-19 decreased year-over-year to $8.0 million in the fourth quarter of 2021, from $22.9 million dollars in the prior year period. The decline in revenue is attributed to lower testing volumes with major customers as the market shifts to point-of-care solutions such as rapid antigen testing.

Total microbiome revenue, including kits and services, was $5.9 million in the quarter and increased 65% from the fourth quarter of last year. OraSure’s subsidiary, Diversigen, now supports more than 50 commercial customers, including more than 30 biopharmaceutical customers with 20 ongoing clinical trials.

OraSure has announced the planned launch of a new gut metatranscriptome collection kit in the first half of 2022, to complement the gut metatranscriptome service offering of its Diversigen business launched in the fourth quarter of 2021. Orasure has received the first and only authorization to the US FDA for a new gut microbiome collection kit that the company plans to launch commercially in the first half of fiscal 2022.

About OraSure

Bethlehem-based OraSure Technologies (OSUR: NASDAQ), together with its wholly owned subsidiaries, DNA Genotek, Diversigen and Novosanis, develops, manufactures and distributes rapid diagnostic tests, sample collection and stabilization devices and solutions of molecular services designed to discover and detect critical medical conditions.

OraSure’s product portfolio is sold worldwide to clinical laboratories, hospitals, medical practices, clinics, public health and community organizations, research institutes, government agencies, pharmaceutical companies, commercial entities and directly to consumers.

Comments are closed.