OpGen Reports Third Quarter 2023 Financial Results and Provides Business Update
14 Nov 2023
Financial StatementLicense out/in
OpGen Reports Third Quarter 2023 Financial Results and Provides Business Update
Total revenue for the first nine months of 2023 was approximately $2.35 million compared to approximately $1.89 million in the first nine months of 2022
Implemented certain cash management initiatives, including restructuring U.S. operations by reducing headcount during the third quarter of 2023
Signed preferred stock purchase agreement with a potential strategic investor in October 2023
Entered into a warrant inducement agreement with an institutional investor in October 2023
Subsidiaries Curetis GmbH in Germany and Ares Genetics GmbH in Austria filed for insolvency under German and Austrian laws, respectively, in November 2023
ROCKVILLE, Md., Nov. 14, 2023 (GLOBE NEWSWIRE) -- OpGen, Inc. (Nasdaq: OPGN, “OpGen” or “the Company”), a precision medicine company harnessing the power of molecular diagnostics and bioinformatics to help combat infectious disease, reported its third quarter 2023 financial and operating results.
Third Quarter 2023 Financial Results of OpGen, Inc.
Total revenue for the third quarter of 2023 was approximately $0.70 million compared to the Company’s revenue of approximately $0.45 million in the third quarter of 2022. Total revenue for the nine months ended September 30, 2023 was approximately $2.35 million compared to the Company’s revenue of approximately $1.89 million in the nine months ended September 30, 2022.
Total operating expenses decreased in the third quarter of 2023 to approximately $4.26 million compared to approximately $13.96 million for the third quarter of 2022 primarily due to the Company’s goodwill impairment charge of $6.98 million recorded in the third quarter of 2022. Total operating expenses decreased by approximately 39% in the nine months ended September 30, 2023 to approximately $16.14 million compared to approximately $26.52 million for the same period in 2022.
Cash and cash equivalents were approximately $0.29 million as of September 30, 2023, compared with approximately $7.44 million as of December 31, 2022.
The Company entered into two agreements in October 2023 to improve its cash position consisting of a preferred stock purchase agreement for $1.0 million in gross proceeds with a potential strategic investor and a warrant inducement agreement with an existing institutional investor that, as of November 14, 2023, resulted in gross proceeds of approximately $2.06 million. Nevertheless, the Company has concluded that there is substantial doubt about the Company’s ability to continue as a going concern. The Company continues to actively consider multiple alternatives, including, but not limited to, restructuring or refinancing its debt, seeking additional debt or equity capital, reducing or delaying business activities, selling assets, other strategic financings or transactions and other measures, including obtaining relief under applicable bankruptcy laws. There can be no assurance that the Company will be able to identify or execute on any of these alternatives on acceptable terms or that any of these alternatives will be successful.
In the reporting quarter and year to date, the Company has seen the following key developments:
OpGen implemented certain cash management initiatives, including restructuring its U.S. operations by reducing headcount from 23 to 6 and scaling down operations at OpGen’s U.S. headquarters to the core functions of a U.S. Nasdaq listed company with only minimal marketing and sales support, allowing the Company to conserve cash and focus on the functions needed to pursue potential strategic alternatives.
In October 2023, OpGen amended its non-exclusive distribution agreement with Fisher Healthcare to allow Fisher Healthcare to sell to existing U.S. Unyvero customers of the Company, which had previously been maintained by the Company’s sales force.
In October 2023, OpGen’s German subsidiary Curetis GmbH responded to all of the FDA’s additional requests with regard to Curetis' De Novo request for the Unyvero UTI urinary tract infection test in order to continue the FDA review.
In October 2023, OpGen entered into a preferred stock purchase agreement with a potential strategic investor for gross proceeds of $1.0 million in exchange for 1,000 shares of the Company’s Series D Preferred Stock. In connection with the ongoing discussions for a transaction with such potential strategic investor, the parties anticipate closing the transaction under the preferred stock purchase agreement as soon as practical.
On November 6, 2023, following OpGen’s unsuccessful efforts to sell the businesses or assets of its wholly owned subsidiaries Curetis GmbH and Ares Genetics GmbH or to access additional capital to continue their operations, Curetis GmbH and Ares Genetics GmbH filed for insolvency under the applicable German and Austrian laws, respectively.
About OpGen, Inc.
OpGen, Inc. (Rockville, Md., U.S.A.) is a precision medicine company harnessing the power of molecular diagnostics and bioinformatics to help combat infectious disease. Along with our subsidiaries, Curetis GmbH and Ares Genetics GmbH, both of which are subject to insolvency proceedings under German and Austrian laws, respectively, since November 6, 2023, we are developing and commercializing molecular microbiology solutions helping to guide clinicians with more rapid and actionable information about life threatening infections to improve patient outcomes, and decrease the spread of infections caused by multidrug-resistant microorganisms, or MDROs. OpGen’s current product portfolio includes Unyvero and the ARES Technology Platform including ARESdb, NGS technology and AI-powered bioinformatics solutions for antibiotic response prediction including ARESiss, ARESid, ARESasp, and AREScloud.
For more information, please visit www.opgen.com
Forward-Looking Statements
This press release includes statements regarding the third quarter of 2023 and the current business of OpGen. These statements and other statements regarding OpGen’s future plans and goals constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and are intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. Such statements are subject to risks and uncertainties that are often difficult to predict, are beyond our control, and which may cause results to differ materially from expectations. Factors that could cause our results to differ materially from those described include, but are not limited to, the risks and uncertainties relating to the insolvency proceedings of Curetis GmbH and Ares Genetics GmbH, our ability to continue to finance our business and operations, the result of any alternatives to mitigate the Company’s cash position, including restructuring or refinancing of our debt, seeking additional debt or equity capital, reducing or delaying our business activities, selling assets, other strategic transactions or other measures, including obtaining relief under U.S. bankruptcy laws, and the terms, value and timing of any transaction resulting from such alternatives, our ability to satisfy debt obligations under our loan with the European Investment Bank, and our liquidity and working capital requirements. For a discussion of the most significant risks and uncertainties associated with OpGen's business, please review our filings with the Securities and Exchange Commission. You are cautioned not to place undue reliance on these forward-looking statements, which are based on our expectations as of the date of this press release and speak only as of the date of this press release. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
OpGen:
Oliver Schacht
President and CEO
InvestorRelations@opgen.com
OpGen Investor & Press Contact:
Alyssa Factor
afactor@edisongroup.com
Condensed Consolidated Balance Sheets
(unaudited) September 30, 2023 December 31, 2022 Assets Current assets Cash and cash equivalents $292,642 $7,440,030 Accounts receivable, net 422,725 514,372 Inventory, net 1,198,259 1,345,137 Prepaid expenses and other current assets 1,541,074 1,355,949 Total current assets 3,454,700 10,655,488 Property and equipment, net 3,820,829 3,457,531 Finance lease right-of-use assets, net 986 3,500 Operating lease right-of-use assets 1,915,049 1,459,413 Intangible assets, net 6,842,406 7,440,974 Strategic inventory 1,608,890 2,300,614 Other noncurrent assets 492,022 495,629 Total assets $18,134,882 $25,813,149 Liabilities and Stockholders’ Equity Current liabilities Current maturities of long-term debt $9,199,764 $7,023,901 Accounts payable 904,559 420,821 Accrued compensation and benefits 381,807 1,097,654 Accrued liabilities 1,268,723 1,526,204 Deferred revenue 194,687 142,061 Short-term finance lease liabilities 1,121 3,364 Short-term operating lease liabilities 521,424 377,626 Total current liabilities 12,472,085 10,591,631 Long-term debt, net — 4,850,686 Derivative liabilities 34,364 99,498 Long-term finance lease liabilities — 280 Long-term operating lease liabilities 2,830,282 2,566,138 Other long-term liabilities 121,428 129,368 Total liabilities 15,458,159 18,237,601 Stockholders’ equity Preferred stock, $0.01 par value; 10,000,000 shares authorized; none issued and outstanding at September 30, 2023 and December 31, 2022 — — Common stock, $0.01 par value; 100,000,000 shares authorized; 10,013,524 and 2,899,911 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively 100,135 28,999 Additional paid-in capital 291,705,905 281,167,161 Accumulated deficit (288,451,655) (272,824,772)Accumulated other comprehensive loss (677,662) (795,840)Total stockholders’ equity 2,676,723 7,575,548 Total liabilities and stockholders’ equity $18,134,882 $25,813,149
Condensed Consolidated Statements of Operations and Comprehensive Loss
(unaudited) Three months ended September 30, Nine months ended September 30, 2023 2022 2023 2022Revenue Product sales$558,965 $359,112 $1,409,534 $1,614,435 Laboratory services 47,135 31,016 112,810 94,515 Collaboration revenue 92,922 58,585 826,257 176,713 Total revenue 699,022 448,713 2,348,601 1,885,663 Operating expenses Cost of products sold 618,796 1,886,191 1,925,566 2,824,577 Cost of services 73,174 17,239 405,582 63,450 Research and development 1,201,865 2,031,113 4,403,488 6,621,310 General and administrative 2,034,628 2,020,452 6,883,588 6,779,773 Sales and marketing 336,184 1,031,496 2,522,471 3,252,277 Goodwill impairment charge — 6,975,520 — 6,975,520 Total operating expenses 4,264,647 13,962,011 16,140,695 26,516,907 Operating loss (3,565,625) (13,513,298) (13,792,094) (24,631,244)Other (expense) income Interest and other income 24,977 11,174 86,301 28,147 Interest expense (396,768) (569,306) (1,698,564) (2,618,799)Foreign currency transaction (losses) gains (135,930) (51,547) (288,326) 419,160 Change in fair value of derivative financial instruments 10,389 18,995 65,800 54,623 Total other expense (497,332) (590,684) (1,834,789) (2,116,869)Loss before income taxes (4,062,957) (14,103,982) (15,626,883) (26,748,113)Provision for income taxes — — — — Net loss$ (4,062,957) $ (14,103,982) $ (15,626,883) $ (26,748,113)Net loss available to common stockholders$(4,062,957) $(14,103,982) $(15,626,883) $(26,748,113)Net loss per common share – basic and diluted$(0.46) $(5.92) $(2.38) $(11.40)Weighted average shares outstanding – basic and diluted 8,778,152 2,382,848 6,565,853 2,345,794 Net loss$(4,062,957) $(14,103,982) $(15,626,883) $(26,748,113)Other comprehensive income (loss) – foreign currency translation 78,815 (536,758) 118,178 (2,247,749)Comprehensive loss$(3,984,142) $(14,640,740) $(15,508,705) $(28,995,862)
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