BDSX Q3 2024: Maintains $70–72M Guidance and $11M Biopharma Backlog
- Sales Force Productivity & Expansion: The management highlighted strong sales rep productivity—with some reps achieving over $1 million in revenue—and ongoing expansion through new hires and upgraded territories to drive future growth.
- Resilient Pipeline & Revenue Guidance: Despite short-term disruptions (e.g., hurricanes), the company maintained its full-year revenue guidance of $70–$72 million and reported a robust backlog in biopharma services (approximately $11.1 million contracted), indicating a healthy and resilient demand.
- Catalysts from Clinical Data & Market Adoption: Positive reception at CHESS, ongoing clinical studies like [ClariPhy], and discussions around potential guideline inclusion for lung diagnostic tests serve as key catalysts, underscoring the strong market potential and long-term growth trajectory.
- Biopharma revenue timing risk: The company acknowledged that delays in sample receipt and project completions are pushing biopharma revenue recognition from one quarter to the next, making revenue visibility dependent on project timing and potentially leading to future quarter shortfalls.
- Vulnerability to regional disruptions: The hurricanes in the Southeast notably impacted testing volumes by forcing evacuations and limiting patient access in regions with high lung cancer prevalence, raising concerns over future disruptions affecting core lung diagnostics.
- Sales force expansion and execution challenges: Slow hiring and the need for extensive onboarding—as noted from delayed hiring decisions and underperforming territories—may impede ramp-up efforts and sustained productivity, while lingering reimbursement or Medicare Advantage issues add further uncertainty.
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EBITDA Outlook
Q: How will EBITDA turn positive in H2 2025?
A: Management explained that by maintaining high gross margins (in the 77–80% range) and exercising disciplined cost control while gradually expanding its sales force, they expect to hit adjusted EBITDA profitability in the second half of 2025. -
Revenue Guidance
Q: How did hurricanes affect revenue briefly?
A: They noted that hurricanes in the Southeast disrupted testing for about two weeks, but patient and provider recovery is underway, supporting the full-year guidance of $70M–$72M with minimal long-term impact. -
Biopharma Backlog
Q: What’s the timeline for biopharma revenue conversion?
A: Management expects that roughly 70–80% of the biopharma backlog will convert into revenue within 12–18 months, with full recognition occurring over a three-year horizon. -
Sales Productivity
Q: What is revenue per sales rep now?
A: The team is averaging about $1M per rep—with some reaching well above $1.5M—thanks to disciplined hiring and strategic territory splits. -
Top-Line Drivers
Q: What will drive additional revenue growth?
A: Key inflection points are broader system adoption, potential guideline inclusion, and ongoing investments in high-quality clinical data to fuel incremental test volumes. -
CHESS Momentum
Q: How was the CHESS conference received?
A: CHESS proved to be a record-setting event with strong physician engagement and proactive lead follow-up, bolstering confidence in a strong start for 2025. -
Screening Impact
Q: How does blood-based screening influence testing?
A: While blood-based tests show promise, they can yield more false positives; thus, they are seen as complementary to Nodify, enhancing patient triage for further testing. -
Hiring Pace
Q: Why did hiring progress slow?
A: They deliberately delayed onboarding to secure the right talent and maintain cultural fit, with plans to ramp up hiring in early 2025. -
Medicare Advantage
Q: What’s the update on Medicare Advantage issues?
A: Efforts with 1–2 payers continue without broader problems, as payment performance remains strong and no further expansion of issues is anticipated. -
Revenue Per Test Consistency
Q: Were there any one-time cash effects in revenue per test?
A: Management confirmed that current revenues and ASP improvements strictly reflect regular operations with no one-time cash collections influencing the figures. -
Territory Management
Q: How are new territories being managed?
A: The strategy involves a mix of adding new hires and upgrading territories by replacing underperformers to ensure optimal and consistent coverage. -
Hurricane Recovery Timing
Q: How long did post-hurricane effects last?
A: There was a brief lag in sample collection after the hurricanes, but recovery is well underway with minimal lingering disruption. -
ClariPhy Study
Q: What is the focus of the ClariPhy study?
A: The study aims to assess the test’s performance in underrepresented subgroups and compare results against PET scan outcomes to further validate clinical utility.
Research analysts covering BIODESIX.