BDSX: Biodesix awarded U.S. Federal Supply Schedule contract
Biodesix announced the award of a U.S. Federal Supply Schedule contract which includes the Veterans Health Administration providing care for U.S. Veterans and Military Health System providing care for active-duty service members and their families. The contract covers the company's entire lung diagnostic portfolio: Nodify XL2, Nodify CDT, VeriStrat, GeneStrat ddPCR, and GeneStrat NGS testing. The U.S. Department of Veterans Affairs is the largest integrated health care system in the United States and provides care at 1,298 health care facilities, including 171 VA Medical Centers and 1,113 outpatient sites of care of varying complexity to over 9 million veterans enrolled in the VA health care program. |
Marvellous long term future ahead for Oncimmune, a global leader in all things auto-antibody & immunodiagnostics.
Find out here why from CEO Adam Hill & Chairman Alistair Macdonald.
www.linkedin.com/posts/paul-hill-a5994116_video-qa-with-oncimmune-ceo-dr-adam-m-activity-6983329490898714625-lwvh?utm_source=share&utm_medium=member_desktop |
Link to a company update/interview published today and crucially the CEO reiterated that they do not anticipate a need to come to market to fund organic growth. |
 @rambutan2
Yes, I think you are right this is a key pharagraph, but once again I think it suffers from their communication style which would benefit from being more explicit. I also think there is a mistake in the announcement, the cash margin requirement is a covenant to demonstrate (tested on quarterly basis) they have at least 9 months forward cash flow on hand, it is not at a rate of 9%.
I would have presented more like this
Gross Cash
31 May 2021 - 8.63 million
30 Nov 2021 - 2.79 million
31 May 2022 - 2.53 million
Net Debt
31 May 2021 - 0.53 million
30 Nov 2021 - 5.93 million
In Dec 2021 - Company drew down an additional 2.5 million from facility to finance expansion of US BD team
31 May 2022 - 8.16 million
I am afraid my hackles are always raised when I see the levels of interest and fees that IPF and their ilk are able to charge but when you think about it rationally I would rather pay them that and some warrants than be diluted and paying similar levels of cash to a broker.
The headroom is there to sign and convert contracts in to cashflow, this year is now all about execution. The RNS flow on new contract announcements over the next 6 months (which is seasonally the strong period) will be the key leading indicator and if we get positive and early RNS flow we should see the share price move up very substantially. |
I noted this:
Gross cash balance at the period end was GBP2.53M (31 May 2021: GBP8.63M; 30 November 2021: GBP2.97M) and net debt at the period end was GBP8.16M (31 May 2021: GBP0.83M; 30 November 2021: GBP5.39M), after investment, including capacity growth. The Company drew down an additional EUR3.0M (c. GBP2.50M) in December 2021 under the IPF facility to fund the acceleration in the ImmunoINSIGHTS business, including the expansion of the US-based commercial team.
In August 2022, the Group's renewed its debt banking facility with IPF Partners. The new terms provide for a 12-month deferral of all principal repayments until June 2023, no further issue of warrants, no change in the fixed existing cash margin rate of 9%, and the continued repayment of interest as from September 2022. The new facility terms are expected to provide the Group with a cash headroom to continue to grow the commercial pipeline and convert that pipeline into signed contracts, revenue, and cash. An arrangement fee of EUR EUR1.5M has been agreed which is payable at final maturity of the debt, with up to 50% (EUR EUR0.75M) of this fee able to be offset against any warrants already issued to IPF Partners. |
Having reread the Interims I think there are a couple of important things to note.
Firstly they are forecasting to do more revenue in the first half from Immunoinsights GBP4.8 million than the whole business did last year. Even assuming no growth in the pipeline and 50% conversion rate this year and when added to the commercial backlog and also increased revenue from CDT lung GBP 12.5 million of revenue for 2023 does not look like a stretch.
At 80% gross margin and with the highlighted decrease in R&D and certain operational costs we will be very strongly cashflow positive. There is upside in both the conversion of the pipeline and also new prospects added in to the top of the funnel.
Seems to me the shareprice decline is an overreaction caused by a few factors including market sentiment, confusion around the change of the financial year (I saw comment about a miss on revenue, They had always said, possibly not explicitly enough, the forecast was for the 15th months and not the 12 months but others seem to have seen it differently) and I think they are still not up to scratch with the clarity of their message to the market ( all the information is there but you have to dig it out which can lead to misunderstanding and the management message getting lost). |
The RNS has not been written in a way that makes it easy to understand, so it will be good to hear what Adam has to say and he can explain exactly what the outlook is.
But from a first reading it looks very much like the company will be decently cashflow positive in this financial year. If that is indeed the case buying now will be well rewarded. I think todays sellers have their eyes in the rearview mirror.
Quick maths suggests at this stage we are looking at revenue for this financial year of @ GBP12.5 million. Of which about 9.5 million will drop from the gross to net line. From that need to take out SG&A and we can strip out from this year numbers the one offs that were highlighted and also the significant reduction in the R&D that is flagged and then add a bit back for inflation you should be looking at positive operating cash flow of @ 4 to 5 million. |
Was waiting patiently for the drop
Think sub 50p coming and then will buy more
Added few now |
I have not seen this before and I could not find the app in any of the app stores so perhaps it has not been released yet.
Interesting but not game changing in and of itself but does suggest a management team that are focused on both the big picture and the nuts and bolts of the existing business. |
Couple of instis unloading. Reckon Genostics have gone against their agreement and are unloading. Plus there's always cash raise concerns. Like this company but it's been drifting for a year |
Yeah it's rubbish! |
Can any cast some light on the recent performance? |
For anyone who wants to get to grips with how the ImmunoINSIGHTS business works in practice and specifically in Immuno-oncology the link above provides a very good overview. It is presented by Oncimmune's Hans-Dieter Zucht and was posted last month. |
A recent spotlight on ONC from Luminex who are a key partner for us given their XMAP technology. |
Outstanding growth expected in H2! Cheap IMHO |
Yet another contract. They have been a bit unlucky with the market back drop against which they have been announcing this string of contract awards. |
You probably don’t want JW to get it. Look how he got POLX …… you don’t hear him go on too much about the 100x potential on that one any more. In fact podcast suggests he has been trimming that position down. |
Brummy_git,
Thanks for that and the one 2 one earlier in the week.
It's a hidden gem, but probably due to investors not understanding the tech, or the RNS content.
Even Justin in the last interview, with his FDA comme3nt, highlights a need for the company to do a plain non tech version of the RNS and what their tech does. Maybe some PR also to attract a wider audience before it gets snapped up on the cheap! |
Justin Waite & I of Vox Markets discussed Oncimmune here today (starts 49:00).
www.voxmarkets.co.uk/articles/stocks-to-follow-on-vox-markets-4th-march-2022-ef5d2a0 |
Out of interest: |
Another day, another contract. A NEW large pharma to boot. |
Hard not to be happy with that outlook and they were very clear no new capital (debt or equity) needed.
We have also been told plenty more contracts to come in the coming weeks or months.
KT_Aim : Early CDT Lung does not work ? That is really your conclusion ? I suggest you look again. It would be fair to say it is slow/hard to commercialise but that is true of all new diagnostics. As you say perhaps are you are just not seeing it. |
Nice recovery - should be strong H2 |
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