HemeScreen projected to rapidly become a material revenue contributor in 2021
NEW HAVEN, CT, (March 30th, 2021) – Specialty cancer diagnostics company Precipio, Inc. (NASDAQ: PRPO), announced its audited results for 2020. The Company posted revenues of $6.1 million, an increase of $3.0 million from 2019, representing a 95% year-over-year increase. Additionally, Q4-2020 revenues of $1.9 million represent a 180% increase from revenues of $0.7 million in Q4-2019 and, if continued, would represent an annualized revenue run rate of approximately $8.0 million entering 2021.
The main driver of 2020 growth was the pathology services, with a year over year increase of 26% in our customer base, 27% increase in the number of ordering physicians, and 117% increase in the number of cases received.
HemeScreen a key growth driver in 2021
In 2021, revenues from our products, which were less than 3% of Company revenues in 2020, are expected to reach approximately 50% of our pathology revenue by the fourth quarter of 2021. This growth will be primarily driven by HemeScreen sales to Physician Office Laboratories (POLs) which are embracing this technology and our reagent-rental offering. We have over 10 signed customers, some of them already generating revenue, and an active pipeline of >30 target customers introduced via our partnership with ION Solutions. We are optimistic about the opportunity to add substantial revenue from HemeScreen this year.
In addition, we continue to make progress with our trial customers for IV-Cell. Despite COVID slowing down the onboarding process for these laboratories, we remain confident in the benefits IV-cell offers customers and its ability to add to sales growth.
Review of 2020 results
Gross profit for Q4-20 was $0.5 million, an increase of 27% from the prior quarter, reflecting the Company’s ability to leverage laboratory production costs as case volume increases.
For 2020, gross profit was $1.2 million, an increase of $0.9 million from 2019. 2020 operating expenses of $9.8 million increased less than $0.2 million (or less than 2%) when compared to 2019, while revenue during the same period almost doubled. During 2020, the company focused on reducing general and administrative expenses while reinvesting in selling and R&D initiatives.
“The efforts of our team throughout the 2020 Covid shutdown were incredible, and the results speak for themselves”, said Ilan Danieli, the Company’s CEO. “We began to prepare in mid-March 2020 for the unknown; the individual efforts of our lab, R&D and sales personnel define the word “perseverance” and the phrase “commitment to excellence”. We now have the opportunity to leverage a powerful growth engine which has been put through the challenges of 2020 and is ready for takeoff in 2021.”
Precipio has built a platform designed to eradicate the problem of misdiagnosis by harnessing the intellect, expertise and technology developed within academic institutions and delivering quality diagnostic information to physicians and their patients worldwide, as well as proprietary products that serve laboratories worldwide. Through its collaborations with world-class academic institutions specializing in cancer research, diagnostics and treatment such as the Yale School of Medicine, Harvard’s Dana-Farber Cancer Institute, and the University of Pennsylvania, Precipio offers a new standard of diagnostic accuracy enabling the highest level of patient care. For more information, please visit www.precipiodx.com.
This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including, among others, statements related to the expected or potential impact of the novel coronavirus (COVID-19) pandemic, and the related responses of the government, consumers, and the Company, on our business, financial condition and results of operations, and any such forward-looking statements, whether concerning the COVID-19 pandemic or otherwise, involve risks, assumptions and uncertainties. Except for historical information, statements about future volumes, sales, growth, costs, cost savings, margins, earnings, earnings per share, diluted earnings per share, cash flows, plans, objectives, expectations, growth or profitability are forward-looking statements based on management’s estimates, beliefs, assumptions and projections. Words such as “could,” “may,” “expects,” “anticipates,” “will,” “targets,” “goals,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “predicts,” and variations on such words, and similar expressions that reflect our current views with respect to future events and operational, economic and financial performance, are intended to identify such forward-looking statements. These forward-looking statements are only predictions, subject to risks and uncertainties, and actual results could differ materially from those discussed. Important factors that could affect performance and cause results to differ materially from management’s expectations, or could affect the Company’s ability to achieve its strategic goals, include the uncertainties relating to the impact of COVID-19 on the Company’s business, operations and employees and the other factors that are described in the sections entitled “Risk Factors” and “Management’s Discussion and Analysis” in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020, as updated from time to time in the Company’s Securities and Exchange Commission filings.
The company’s forward-looking statements in this press release are based on management’s current views, beliefs, assumptions and expectations regarding future events and speak only as of the date of this release. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by the federal securities laws.