Oncocyte Reports GraftAssure™ Beta Launch Success and Q2 2024 Results

Oncocyte Corp., a company specializing in diagnostic technology, has released its second quarter 2024 results and shared a letter with its shareholders. The company announced the successful launch of GraftAssure™, a research-use-only assay designed to detect early signs of graft organ damage in blood samples. This assay was first used outside of Oncocyte labs on July 11, 2024, at a major transplant center and research university in the northeastern United States, followed shortly by a leading transplant center in Southeast Asia.

Since January 2023, Oncocyte has been focused on commercializing its transplant test intellectual property, particularly through the development of a kitted test that relies on a biomarker known as donor-derived cell-free DNA (dd-cfDNA). The first prototypes of GraftAssure were produced in December, and by April 2024, Bio-Rad Laboratories had become an investor and strategic partner, supporting the global launch of GraftAssure. In the first week of shipments in June 2024, the company delivered its products to major transplant centers and research universities in the U.S. and Southeast Asia.

Oncocyte has reported significant interest in its transplant assay from centers that represent approximately 25% of U.S. transplant volumes. The company is also seeing interest in Germany, other European countries, Asia, and the Middle East. Oncocyte and Bio-Rad are co-marketing GraftAssure in the U.S. and Germany, while Bio-Rad leads the commercial efforts outside these regions.

Beyond sales, Oncocyte continues to build industry relationships and partnerships, such as an agreement with a European biotechnology company to provide dd-cfDNA testing for a Phase II clinical trial for a therapeutic in antibody-mediated rejection. These partnerships validate Oncocyte’s technology and support new clinical applications of their diagnostic tools, which may lead to future recurring revenue.

Oncocyte's VitaGraft Kidney, which received Medicare reimbursement in 2023, is increasing its throughput in Oncocyte’s CLIA lab by implementing higher automation and scaling options. This expanded capacity will support ongoing clinical trials and generate data necessary for future FDA in-vitro diagnostic (IVD) program submissions.

Oncocyte’s "land and expand" strategy involves introducing GraftAssure to major transplant centers and research universities as a research-use-only product to build utility and prepare for eventual clinical use after obtaining FDA clearance. The company believes that it can achieve this with a limited sales force due to the concentrated nature of the industry, where fewer than 100 academic and research centers in the U.S. account for about 80% of transplant volumes.

In Q2 2024, Oncocyte reported revenue of $104,000 from pharmaceutical services and a gross profit of $50,000. Operating expenses totaled $4.7 million, and the company recorded a loss from continuing operations of $4.5 million. Oncocyte ended the quarter with approximately $11.0 million in cash, including proceeds from a capital raise in April and investment from Bio-Rad.

In anticipation of rapid growth, Oncocyte appointed Andrea James as Chief Financial Officer in June 2024. Andrea brings extensive experience in financial strategy, capital raising, and investor relations from her previous roles at Axon Enterprise, Inc., and Tesla, Inc.

Oncocyte is focused on democratizing access to molecular diagnostic testing to improve patient outcomes, combining innovative science with a disruptive business model. The company aims to have more than 20 transplant centers running GraftAssure tests by the end of 2025, projecting each center could eventually generate annual revenue of several hundred thousand dollars to $2 million.