SQI Diagnostics gains momentum achieving recurring revenues with major new commercial milestones
Installations, test volume, client acquisition and recurring revenues all demonstrate continued commercial progress.
TORONTO, July 30, 2018 /PRNewswire/ - SQI Diagnostics Inc. (TSX-V: SQD; OTCQB: SQIDF), a life sciences and diagnostics company that develops and commercializes proprietary technologies and products for advanced microarray diagnostics ("SQI" or the "Company"), today provided an operational update on its commercial activities during the current fiscal year.
"We're achieving not only an inflection point in achieving recurring sales, but also opening new revenue streams for the same transformation to occur," said Andrew Morris, President and CEO of SQI.
"Our commercial success is anchored in our ability to grow the sales of platforms and kits to our customers and reduce the relative contribution of revenue from service-based sales. We are now delivering on that model and there are many reasons we expect this trend to continue. The number of kit sales to customers will continue to grow as our customers gain confidence and expand their business with us. Service revenue will always be a component of our business model as it is a key phase in onboarding new customers and we expect this component of our revenue will grow as we transition customers through the sales pipeline."
"For the first time in SQI's history, we have reached a major milestone by expanding the volume of recurring kit sales to three major customers whose kit usage is growing."
Specifically, during the fiscal year to date, SQI has:
We have grown our installed base of systems and have a solid pipeline of systems targeted at achieving our goal of 10 systems installed by the end of the year.
We currently have 5 systems installed; 2 recently delivered and being installed within one week; pending shipment for 1 evaluation system at a large contract research organization and an additional 4 systems in our near-term sales pipeline – 3 of these are for an existing customer. The combined total of 12 systems listed above is a notable milestone in SQI's commercialization pathway. More installed systems generating recurring revenues will be transformative.
Generated an increase of eight times kit sales from the first quarter for the cardiac health predictive product.
We believe the number of recurring, monthly kit sales are on-track to reach over 5,000 patient samples this calendar year. The demand for our product has increased from 1,000 tests per month to 2,500 tests per month in the last quarter. Within the next year, it is reasonable to expect that SQI could be manufacturing and selling tests for 25,000 patients per month.
As cited in leading scientific papers, the test's predictive potential has been shown to predict the likelihood that patients will experience a heart attack (ACS event) up to five years in advance. The benefit is significant and obvious; doctors can now put in place potentially life-saving preventative measures to keep the heart attack from happening.
The narrative created with this cardiac product has parallels to the product being developed by Microdrop (www.microdrop.health), another SQI customer. Microdrop is launching imaware™, an advanced home-based health testing platform that will provide patient awareness to life-altering conditions. imaware™ will initially provide tests for Celiac Disease and Rheumatoid Arthritis, which are two significantly underdiagnosed illnesses. While these diseases currently afflict about 1% of the American population, potentially another 1% of Americans may have these diseases and not be aware of it. Early awareness and diagnosis of both Celiac and Rheumatoid Arthritis are critical in order to stem ongoing damage to the body. Microdrop is using sqidlite machines and test kits to deliver this revolutionary new testing platform and will launch imaware™ later this Fall.
This month, SQI delivered two sqidlite systems to Microdrops' US-based CLIA laboratory with the goal of testing 50,000 celiac patients and 25,000 Rheumatoid Arthritis patients annually, within approximately one year.
While our focus is on commercialization, we will always be a research-based organization working to improve the quality, speed and safety of our testing across a growing range of conditions.
To that end, we made continued progress with our instant immunoassay collaboration with McMaster University. During the quarter we continued to progress on our targeted development milestones and have achieved a more consistent methodology for manufacturing the single-use chips. The data from these chips are positive and we believe we are on a path to test sensitivity which will equal our current high sensitivity tests. Our next milestone for this project is August 2018 when we will continue to optimize the performance of the pilot design for better sensitivity, linear range, precision, and device stability.
"We continue to advance and move customers up the revenue funnel from target customers, through product development to commercial validation and product shipments. What's more, the duration from signing a new client to generating revenue has shortened considerably. We are confident that number will grow in the next quarters and that revenue-per-customers will also grow significantly," said Andrew Morris.
About SQI Diagnostics
SQI Diagnostics is a life sciences and diagnostics company that develops clinical grade multiplexed microarray and molecular assays run on its automated instrumentation for the pharmaceutical research, animal health, and clinical diagnostics markets. SQI develops custom research and diagnostic assays that are multiplexed; meaning the simplification, consolidation and automation of many individual tests into one. This increases sample throughput, reduces time, cost and chance for human error, and provides excellent data quality. For more information, please visit sqidiagnostics.com.
Sales and Marketing Contact:
Vice President, Global Commercial Operations
SQI Investor Relations Contacts:
Chief Executive Officer
Vice President, Finance and Administration
416.674.9500 ext. 229
416.674.9500 ext. 277
This press release contains certain forward-looking statements, including, without limitation, statements containing the words "may", "plan", "will", "estimate", "continue", "anticipate", "intend", "expect", "believe", "in the process", "is subject to" and other similar expressions which constitute "forward-looking information" within the meaning of applicable securities laws. Forward-looking statements reflect the Company's current expectation and assumptions, and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated. These forward-looking statements involve risks and uncertainties including, but not limited to, the ability of our patents to adequately protect our rights or permit us to gain or keep any competitive advantage, and our ability to market and sell our novel multiplexing technologies and detection platforms. Such statements reflect the current views of the Company with respect to future events and are subject to certain risks and uncertainties and other risks detailed from time-to-time in the Company's ongoing filings with the securities regulatory authorities, which filings can be found at www.sedar.com. Actual results, events, and performance may differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements either as a result of new information, future events or otherwise, except as required by applicable securities laws.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.