Biocept, Inc.
Q4 2017 Earnings Call Transcript

Published: 29 Mar 2018

[Operator:]

Ladies and gentlemen, thank you for standing by. Welcome to the Biocept Fourth Quarter and Full Year 2017 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Following management's prepared remarks, we will hold a question-and-answer session [Operator Instructions]. As a reminder, this conference call is being recorded today, March 28, 2018. I’d now like to turn the call over to Mr. Bruce Voss. Please go ahead, sir.

[Bruce Voss:]

Thank you. This is Bruce Voss with LHA. Thank you all of you for participating in today’s conference call. Joining me from Biocept are Michael Nall, President and Chief Executive Officer, Tim Kennedy, Senior Vice President of Operations and Chief Financial Officer. During this call, management will be making a number of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that are not historical facts, and generally can be identified by terms such as anticipates, estimates, believes, could, expects, intends, may, plans, potential, predicts, projects, should, would, will, or the negative of those terms. Forward-looking statements involve known and unknown risk, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from those statements, as well as performance or achievements that are expressed or implied by the forward-looking statements. For details about these risks, please see the Company’s SEC Filings. The content of this call contains time sensitive information that is accurate only as of today, March 28, 2018. Except as required by law, Biocept disclaims any obligation to publicly update or revise any information to reflect events or circumstances that occur after this call. Now I’d like to turn the call over to Michael Nall. Mike?

[Michael Nall:]

Thanks Bruce, and thanks to everyone for joining us on the call. I hope you've had an opportunity to see our press release from earlier today, announcing our collaboration with Thermo Fisher Scientific. This partnership gives us access to Thermo Fisher’s proprietary molecular oncology assay panel Oncomine, which is run utilizing next generation sequencing or NGS. Under the agreement, we intend to validate the panel in our clear laboratory here at Biocept. Once completed, we expect to become a Thermo Fisher liquid biopsy center of excellence, and intend to jointly market our services to the pharmaceutical industry. We also plan to eventually expand our current menu to include this panel for clinical use. Importantly, we have agreed to work together with Thermo Fisher to evaluate the development of additional products and services, through the combination of cutting edge technologies from both companies. Turning to a brief overview of our financial results. Revenues for 2017 increased 57% compared to 2016, including the impact of changing to the accrual basis of revenue recognition from the cash basis for commercial samples. This growth reflects our success in developing relationships with health plans, as well as upgrades to our billing and collection processes that dramatically improved reimbursement for our commercial target selector liquid biopsy tests. That said, our billable sample volume for the year grew at a more modest 7%. You might recall that in the third quarter of last year, we increased the number of field representatives in our commercial organization. We had anticipated a corresponding increase in volume during the fourth quarter as the new hires gain tenure. However, that increase did not occur. As a result, we have taken actions by refining our sales strategy aimed at getting our volume growth back on track. While we have several territories that are performing above plan, there are others that are below target. We are combining some territories and replacing representatives in others. I'm pleased to report that we are seeing improvement in the daily average and sample volume. During the fourth quarter of 2017, we averaged about 16 accessions per sales day. To date, in the first quarter of 2018, we are averaging approximately 18 accession per sales today, as liquid biopsy starts to move towards becoming the standard of care for patients with lung cancer. Notably, most of the specimens we receive at Biocept, are from patients diagnosed with lung cancer. This is due to the difficulty in obtaining a lung biopsy and when a biopsy is performed, gaining adequate tissue for molecular testing. I want to mention two recent developments that hold promise for increasing billable volume and sales. In late January, new treatment guidelines recommending the use of liquid biopsy in patients with lung cancer, were issued by four prominent clinical associations, the College of American Pathologists, the International Association for the Study of Lung Cancer, the Association for Molecular Pathology and the American Society for Investigative Pathology. Evidence based guidelines are essential for generating adoption of innovative medical technologies, and these guidelines call for using liquid biopsy at two time points in the patient care continuum. First, liquid biopsy is recommended for use at the time of diagnosis or disease occurrence when tissue is inadequate or unavailable. Secondly, liquid biopsy is now recommended to be ordered immediately when a patient fails first line targeted therapy and must be reassessed for second line targeted therapy. We believe these guidelines validate the clinical utility of liquid biopsy, as well as its key benefits relative to tissue biopsy. That utility includes the ability to rapidly obtain molecular information about a patient's tumor if the cancer is changing, and reduce risk to patients through the use of a simple blood sample instead of a surgical biopsy. These new guidelines were jointly published in the Archives of Pathology and Laboratory Medicine, The Journal of Thoracic Oncology, and The Journal of Molecular Diagnostics. And we are leveraging the publication of these new recommendations to increase the use of our target selector testing in lung cancer. Also, a new coverage policy was recently issued by the Centers for Medicare and Medicaid Services or CMS for molecular testing using next generation sequencing. We believe this action by CMS provides additional evidence that molecular testing is on its way to becoming part of the standard of care, and we view this as an important step in the industry. However, reimbursement for assay panels using next generation sequencing, remains a significant hurdle for both public and private health insurers. And as a result, certain competitors have elected to withdraw from the liquid biopsy segment. At Biocept, we rely on traditional reimbursement coding for our single biomarker target selector test, and we now have an opportunity to increase our share voice in the liquid biopsy market, due to positive coverage for the individual biomarkers. As we evaluate the opportunity to gain reimbursement for the panel approach, we intend to add the Thermo Fisher Oncomine panel to our clinical offerings, in addition to our individual biomarker test in order to offer the most comprehensive menu in liquid biopsy. I now want to briefly review some highlights of our progress since the beginning of 2017. Late last year, we launched our novel molecular pathology partnership program Empower TC. This is the only commercial liquid biopsy offering that allows local pathologist direct involvement in the interpretation of test results. This service aligns local pathologists with our leading edge liquid biopsy technology, which can be important as pathologists are often the first to know when a tissue biopsy is inadequate for molecular profiling. Empower TC has shown strong initial acceptance during its first phase, enabling Biocept to enter into new relationships and deepen existing ones within the medical community around the country. Major cancer centers already signed up for this service are Scripps Health, Tennessee Oncology, and Cancer Treatment Centers of America. Collaborating with medical institutions to further validate our test, has long been a priority of Biocept. Over the past year, we entered into several significant agreements with highly reputable institutions. This included the key collaborations with the Addario Lung Cancer Medical Institute and its consortium of leading US and international oncology centers for participation in the Alchemy 009 liquid biopsy clinical trial. In this trial, four to six blood samples from each of 400 patients diagnosed with lung cancer, will be analyzed over a 12 month period, generating between 1,600 and 2,400 data points to evaluate the clinical utility of using our target selector testing for both the profiling and monitoring of patients with lung cancer. We expect patient enrollment for this landmark trial to begin soon. Last year, we expanded our relationship with the Blue Cross Blue Shield Association, by gaining in-network agreements with Blue Cross Blue Shield of Texas and Wellmark, as well as becoming a preferred provider for the National Blue Cross Blue Shield GPO. Importantly, our target selector tests are routinely reimbursed, with over 200 million covered lives having access to our technology nationwide. We also signed a multi-phased agreement with Oregon Health and Sciences University’s Knight Cancer Institute, granting OHSU the exclusive rights to commercially offer our target selector testing services in the state of Oregon, and to jointly development molecular diagnostic offerings in the future. Additionally, we partnered with the University of Texas Southwestern on studies to examine the clinical utility of liquid biopsy for ALK-positive non-small cell lung cancer. We began studies with both the National Cancer Institute of Mexico, known as INCAN and the University of California San Diego to provide additional clinical validation of our target selector PD01 assay for patients diagnosed with lung cancer. And we recently presented clinical data at the American Association for Cancer Research meeting in collaboration with the University of Minnesota, demonstrating the ability of our CTC platform to monitor key biomarkers in refractory testicular cancer. These data represent a new potential indication for our target selector technology and underscore the versatility of our assay platforms. We also presented data on our Circulating Tumor DNA or CTDNA platform at AACR, which demonstrates even greater performance of our molecular tests since we incorporated Thermo Fisher's QuantStudio 5 PCR instrument into our workflow. A poster on these data can be found on our website, further supporting our industry leading sensitivity and specificity for liquid biopsy using CTDNA. Also in 2017, we executed on our commitment to expand our portfolio of assays with the launch of additional biomarker tests. These include the introduction of Biocept’s liquid biopsy test for progesterone receptor or PR, which completes our menu of assays for all NCCN guideline based biomarkers relevant to patients with breast cancer. We also introduced a test for mutations of the NRAS oncogene, associated with multiple cancer types, including metastatic melanoma, colorectal and lung cancers. Our total clear certified offerings now stands at 15 biomarker tests. In addition to new assays, we obtained seven new patents for our proprietary technologies in 2017, including those for our molecular testing platforms in the US and Australia. To date, Biocept owns 25 issued patents globally for our novel molecular assays and our blood collection tubes. Expanding distribution of our offerings has also been a priority. In the second half of 2017, we entered into an agreement with the leading global laboratory products supplier, VWR International for the exclusive worldwide distribution of our proprietary blood collection tubes, except in China. We believe the VWR agreement is an important step in our future as we move toward becoming a proprietary technology and products company. I'm delighted to announce that after a comprehensive onboarding process, VWR placed an initial stocking order last week, and we anticipate the worldwide distribution of our blood collection tubes will begin in the near future. And finally, since the beginning of 2017, we successfully raised more than $35 million in equity capital, including warrant exercises and our January 2018 financing. We believe we are now well positioned to complete the payoff of our long term debt in July of this year, a move that is expected to reduce our annual cash need in excess of $2 million. We are also beginning an expense reduction plan that is expected to save an additional $1 million to $1.5 million annually, bringing our expected cost savings in the range of $3 million to $3.5 million annually. In 2018, we expect to deliver another year of progress. Our business priorities are as follows. Increase target selector liquid biopsy volume and revenue. Enter into strategic partnerships in the US and internationally. Sign additional Empower TC agreements with pathology groups and other major hospital systems. Capitalize on newly issued industry guidelines that support the use of liquid biopsy for patients with lung cancer. Launch our blood collection tube sales under the VWR marketing and distribution agreement. Sign new third party help line contracts and agreements with integrated health care delivery networks. Launch additional oncology biomarker assays. Grow our companion diagnostics and research business in the pharmaceutical industry with our new collaborator, Thermo Fisher. And continue to publish clinical case studies that validate the use of our target selector assays. And with that, I'll turn the call over to Tim Kennedy to review highlights of our 2017 fourth quarter and full year financial results. Tim?

[Tim Kennedy:]

Thanks, Mike, and good afternoon everyone. Let me start my review of our financial results with the fourth quarter. As a reminder, we accounted for revenue in the fourth quarter of 2017 on an accrual basis, versus a cash basis for the fourth quarter of 2016. For the fourth quarter of 2017, revenue as reported on an accrual basis, was $1 million versus revenue in the fourth quarter of 2016 of $1.3 million, which was recognized on a cash basis. For an apples to apples comparison, we estimate that revenue recognition in the fourth quarter of 2016, would have been approximately $1.1 million on an accrual basis. Commercial reimbursement based on historical mix and test per accession, continues to be in the $1,100 to $1,200 range on average. Total sample volume in the fourth quarter was 1,057, which includes commercial samples, as well as samples submitted for research and validation purposes. Research and validation samples are not billable, but do support the use of our liquid biopsy test, awareness of our services, and the development of our pipeline of new biomarker assays. In Q4 ’17, billable accessions were 982 versus 1,101 in Q4 ’16. As Mike mentioned, our billable volume reflected sales productivity in certain territories that was below our expectations, as well as one less sales day in Q4 ‘17 versus Q4 2016. As a reminder, billable samples are defined as commercial cases, plus those samples that come from our development services. Commercial cases are tests ordered by a physician for which we submit a claim to an insurance company, hospital or other third party responsible for payment. Development cases are testing services performed for either a research partner, a pharmaceutical company or under an international distribution agreement. The number of billable samples per sale day averaged 16 in the fourth quarter of 2017. Also, as Mike mentioned, we believe the measures taken in late 2017 and early in 2018, have resulted in first quarter 2018 billable samples to date of approximately 18 per sales day, which is up about 13% from Q4 ‘17. In addition, we expect that the recently signed pathology partnership agreements, will contribute meaningfully to our volume going forward. Liquid biopsy is in the early stages of acceptance and adoption. Therefore, referral patterns from physician community can be sporadic. Now moving on to our expenses. Cost of revenue for Q4 2017 was $2.4 million, compared to $1.9 million in Q4 2016. The increase was attributable to direct costs from the addition of excess capacity in our lab operations to service expected higher test volumes in future months, as well as expected tests volumes associated with the recent signing of multiple pathology partnership agreements. As mentioned on previous calls, we need to hire in advance of volume increases in order to properly train new employees to effectively process the expected higher number of tests. Research and development expenses for Q4 2017 were $909,000 compared with $668,000 in Q4 2016. The increase was due mainly to the addition of personnel for the development of new biomarker assays, the improvement of existing assays, greater consumption of materials associated with this development, a higher proportion of lab allocation costs, and other costs associated with R&D activities. General and administrative expenses for Q4 2017 were $1.65 million, essentially flat with Q4 2016. Sales and marketing expenses for Q4 2017 were $1.6 million versus $1.2 million in Q4 2016, with the increase due primarily to the expansion of our salesforce in 2017. The net loss for the fourth quarter of 2017 was $5.7 million or $0.18 per share on 31.5 million weighted average shares outstanding. This compares to a net loss for the fourth quarter of 2016 of $4.2 million or $0.27 per share on 15.6 million weighted average shares outstanding. Now turning to the full year. Revenue for 2017 was $5.1 million, an increase of 57% from 2016. Revenue in 2017 comprised of $4.8 million from commercial testing and $272,000 from development services. Commercial net revenue per accession in 2017 was approximately $1,117, an increase of 13% versus approximately $988 in 2016. This, due predominantly to an increase in the average number of tests per accession from about 3.5 in 2016, to an average of about four in 2017. In addition, the results of bringing billing and collections in-house during Q2 ‘17 provided improvements with our ability to get paid on claims denied in prior periods. Total samples accessioned in 2017 were 5,051, an increase of 11% from 2016. Billable samples were 4,517, which represented year over year volume growth of 7%. 2016 had four more sales days versus 2017. In 2017, the average of new account startups per quarter, rose approximately 20% versus 2016, and the same store growth or base account referral volume, increased by about 10% over prior period averages, despite the fewer number of sales days in 2017. For 2017, cost of revenue was $9.3 million. Research and development expenses were $3.4 million. General and administrative expenses were $7.2 million. And sales and marketing expenses were $6.3 million. The net loss for the full year of 2017 was $21.6 million, or $0.79 per share, with about 27 million weighted average shares outstanding. This compares to a net loss in 2016 of $18.4 million, or a $1.92 per share, with about 10 million weighted average shares outstanding. In 2017, cash generated from operations averaged about 15% of the company's cash needs. While our overall expense base grew to support higher current and future period volumes, we expect that our cash generated from operations, will fund a higher percentage of our overall cash need as incremental volume is expected to leverage the fixed components of our costs and consume the excess capacity. Cash and cash equivalents as of December 31, 2017, totaled $2.1 million. In January 2018, the company raised an additional $14.8 million in gross proceeds, primarily from institutional investors. And finally, as a reminder, we switched to accrual based revenue recognition on March 31, 2017. In doing so, we recognized $726,000 of accounts receivable in the first quarter of 2017 that had not previously been reflected as revenues. We will not have a comparable recognition of revenue from accounts receivable in the first quarter of 2018. And with that, I’ll now turn the call back over to Mike. Mike?

[Michael Nall:]

Thank you, Tim. So in summary, we look forward to building upon our accomplishments as we continue to work toward establishing Biocept’s target selector test as a standard of care in liquid biopsy. We have made significant progress in establishing Biocept as a leader in the emerging field of liquid biopsy, and have helped approximately 14,000 patients and their physicians choose the most appropriate treatment plan since our IPO in 2014. We have a differentiated test offering that provides physicians with clinically actionable information they need to develop personalized treatment plans for patients diagnosed with cancer. Our proprietary biomarker assays are based on a unique platform that leverages information from both Circulating Tumor Cells or CTCs, and Circulating Tumor DNA or CTDNA. And we continue to build on the body of clinical evidence that supports the high sensitivity and specificity of our biomarker assays. In addition to organic growth, we are focused on expanding opportunities through strategic partnerships and other alternatives. Importantly, we remain dedicated to our mission of improving the outcomes of patients diagnosed with cancer. I want to thank our employees at Biocept for their constant dedication and hard work, our customers for their trust, our investors for their support, and each of you for dialing in today's call. Tim and I will now be happy to answer questions. Operator, please poll the audience.

[Operator:]

Thank you. [Operator Instructions]

[Michael Nall:]

While we’re waiting for the first question, I'd like to announce that I'll be making a company presentation and hosting a roundtable discussion, covering recent developments in cancer research and treatments at the MicroCap Conference. This conference is being held April 9 and 10 in New York City, and we look forward to seeing those of you who are attending. Okay, Operator, we’re ready for the first question.

[Operator:]

Our first question today will come from Keay Nakae with Chardan. Please go ahead.

[Keay Nakae:]

Thank you. How is it going? So can you tell us how many reps you have now? And then as a point of reference, how does that compare to what you had entering 2017 and what you had at your peak in 2017?

[Michael Nall:]

Well, we'll end up the quarter with about 12 representatives. And so I believe at the start of last year, we had approximately eight. I need to - I don't have the numbers right in front me. Tim is giving me a thumbs up here, Keay. And we have - the peak, we have 16. So we've downsized a bit, but we think 12 was the way to go through most of this year. If - as we see growth continue, we may go ahead and add a few more, but right now the plan is to stick with the 12 that we have.

[Keay Nakae:]

Okay. So happen to be proactive in shifting course here as needed, but in hindsight, looking back as to why you didn't get the growth in sample volume that corresponded with the increase in sales reps and notwithstanding the fact that maybe you didn't hire some of the right people. But what are the factors you think contributed to the lack of the anticipated growth?

[Michael Nall:]

Well, when you look at the overall space, I think there are some lessons to learn overall. And you - it’s kind of always like a funnel, right? If you're a commercial person like me, you're starting at the top and going down to the pinpoint of the call. Molecular testing itself has continually been slow to adopt, although I think we all realize, including physicians, this is where it has to go in the future. But it's tough to change behavior and changing how they treat patients is sometimes difficult. Examples are in lung cancer where still a lot of patients just get treated with chemo rather than a targeted therapy, even if they might be eligible for a targeted therapy. So that's a challenge for companies even like Foundation Medicine which have tremendous resources, has a stake in them what, 10 years now, just about to get where they are today, or eight to 10 years. And so then you go on to liquid biopsy and you see overall that there's been slower adoption than I think all of us had expected since in my view, there is clear clinical utility for these biomarkers. We're just able to detect them in blood as opposed to in tissue. But physicians don't just use common sense of this is a blood test, why wouldn't I do this instead of a tissue biopsy? They use common sense, but they rely on data. And the data has been eventual in coming out, just like it's been with us. And Keay, you've been with us for a long time. We’ve come light years ahead from the data that we had when we started this. But it's still - it's an evolution and evidence of that is in other companies that have now stepped back from the liquid biopsy race, which has helped us, right? As one of the leaders in the space, it's helpful when I see very well funded competitors decide to throttle back and not emphasize that part of the business, or withdraw entirely. It’s a double edged sword though, right? They’re doing that because the market just isn't quite involved just yet. But I know we all believe it is, and those companies do too. It's just a matter of when. And so Biocept as a leadership position, it’s going to allow us to exploit this in the coming year. Two things that make me very excited about this year. One we covered in great deal here, and that was this inclusion in the lung cancer guidelines, because now when our sales team goes and sees a medical oncologist, there shouldn't have to be such a learning curve for them to even get up to speed as to what we're even talking about. We can show them the guidelines. That means that KOLs, Key Opinion Leaders in the industry, have vetted this and decided this is something you should do in these indications. So that's a huge forward step for us this year that just happened in this quarter. So going forward, that's certainly going to be something we think will be helpful and already kind of helped us in this quarter get ahead. The other piece is this whole debate I think you're familiar with Keay, but I'm not sure all the listeners are about reimbursement for next gen sequencing panels. And the fact that CMS has finally decided on that, I think as an industry helps give clarity, which should give investors comfort. So there's a path forward and that's why we're excited about this relationship with Thermo Fisher. We’ll have a marketing strategy to go forward with pharma here at the beginning, while we're working out the reimbursement. And now there is a path to reimbursement, and together with Thermo Fisher, we're going to work on that with our friends in the payer community, specifically at Medicare. So I think those are two very exciting things that hopefully investors stop to think about as we look to what's going to happen this year in 2018, and as we make this a real business going forward in the future when we get that hockey stick we're all looking for.

[Keay Nakae:]

Two questions. One, with respect to Thermo Fisher. At what point do you think you're going to adopt or be a center of excellence for (indiscernible) tests? At what point will you roll these out?

[Michael Nall:]

Well, we're just now announcing the MOU today and stay tuned for the final agreement, which will we'll let you all know about that as well - and in near term. After that, we’ll start the validation. And I would anticipate that we'll have the assay validated around Q3 timeframe. We’re shooting for the end of Q2, but more likely probably the beginning of Q3 to give us a little bit of breathing room there. And from there, we’ll be ready to start marketing to pharma. In the meantime though, we aren’t going to sit and wait for that. We’re going to start the dialogues with the payers. So therefore I've got a path to reimbursement and we can get this launched clinically as well. In addition, we're exploring our technologies to be adopted by some of their platforms. As I think you know, Keay, and I'm not sure others have focused on, maybe they saw the press releases, we have a good partnership there already that we use some of their technology and have developed assays using their technology. We’re exploring how we can integrate those even deeper into their robust product distribution.

[Keay Nakae:]

Okay, And then just a final question on expected cash burn in 2018. I know some of the headcount reduction and interest payment reductions. Can you review those numbers again and just give us a sense of, if nothing else, how far you think your current cash will take you.

[Michael Nall:]

Sure. The - what I had said there before, the payoff of the Oxford debt will be about $2 million annualized. And then - because we’re amortizing obviously right now. And then the other piece was kind of other reductions, including as you mentioned, the sales team size reduction, and that would be about another $1 million to $1.5 million. So three, 3.5 total. As far as how long the cash would last us, as you recall, Keay, we just raised in Q1 and netted about $13.3 million. So we have cash on hand at the end of the year of, Tim, two …

[Tim Kennedy:]

2.1

[Michael Nall:]

2.1 So our burn will be reduced at the end of Q2 and Q1 a little bit from some of those other reductions we talked about. So that hopefully gives you an idea of kind of the timeframe for that money to last.

[Keay Nakae:]

Okay.

[Michael Nall:]

I think we’re still continuing and I’ll just bring it up because people probably wonder. We continue to have exciting opportunities in China. And as I think I’ve shared previously is our challenges as a small company, we really are holding out to get money upfront for a deal. And people shouldn't read into those not interested in our technology in China with our partner Ally Bridge. There's robust interest, but many folks do not want to invest upfront in that. And for me as the CEO of a small company, I need that money upfront to make it worth our while to go invest in China. So we're waiting for that. And the other thing that will help is of course the adoption of the pathology strategy leads us to that standard of care I was talking about earlier by focusing on institutions. And many times, folks don't understand the role of a pathologist. They really in most cases are in charge of diagnostic selection for an institution. So as liquid biopsy moves towards standard of care with the guidelines, this ability of us to have the pathologists on our side and then be included in the process, will be key. So there's lots of other ways that we can help to mitigate some of the burn that we've experienced in the past and we're absolutely focused on exploring all of that. I think obviously it's important to every one of us at the company to look for ways to make more of the dollars that we get from investors.

[Operator:]

Our next question comes from Lauren Chung with WestPark Capital. Please go ahead.

[Lauren Chung:]

Hi. Thanks for taking my call. Just thinking of other - the collaborations that you have made, what’s the progress that you have made so far with Miraca? Can you speak of any updates there?

[Michael Nall:]

Sure. Well, no, that's great. Thanks for asking. Miraca has gone through their own transition since that announcement was made, and they were acquired. Miraca sold off the US diagnostics business to Vista Partners, which is private equity. So they've been going through their own kind of changes, but I - their oncology division, which is where we have the relationship, remains absolutely interested in our platform. And we're kind of getting a restart now. So that was a little bit hung up and delayed due to this acquisition of that business. So they're no longer Miraca. They're called Inform DX, if you want to look up their website. And they’re a great leadership in the company and we’re excited to work with them and expand their menu by including their test and their oncology divisions sales teams back, sales men.

[Lauren Chung:]

Got you. And how about the Alchemy study, how is that going in terms of when we expect to see some data that might help you in the marketing process?

[Michael Nall:]

Sure. The Alchemy study, we hope to get started this quarter, or I should say in Q2. If you recall, Lauren, it’s a multi-center study, and it's been like herding cats, getting all the IRBs and everything rounded up. Now, that's really not on us. We can’t control it. It's the Addario Foundation which is working hard to get this done. But they've got multiple parties involved and that’s caused a delay. We are teed up now we believe to start in Q2 enrolment at the first two sites. So we'll keep everybody focused there as we communicate as to where that is, because it will be a very important study as we said, curating a lot of data. Now, I doubt we're going to have data this year. It’ll be in into 2019 sometime when some of that data starts to come out. Importantly though, if those on the call are new to the story, that's a study we earned through in RFP process. So they bid out all the other liquid biopsy companies. We were chosen to be selected and there is actually payment for part of the study for us, for our testing. So we're excited to get started, one, because we want the data, and two, we get some commercialized revenue out of it as well.

[Lauren Chung:]

How about, to the extent that you can, how does your business impacted with Genomic Health dropping out of the liquid biopsy business? Are you able to get some of their clients or can you comment on that?

[Michael Nall:]

Well, I don't really like to comment on other folks on the call too much. You’ve mentioned the name. I didn't mention that earlier when I was talking about folks withdrawing from the business. But it's a double edged sword like I said. They were dropping out because they see a lot of challenges for reimbursement and adoption in the space as they make their bets. But the good news is, that's one less very well funded competitor that's not out there today. Their offering was more like the big panel approach, more like what we're talking about with Thermo Fisher, where you have a one size fits all panel. It wasn't really like what we offer today, which is the individual test. That being said, yes, their - what clients they had are up for grabs. I'm not certain they had a big market share in the space. It’s really between us and another private company called Guardant that have most of the share in liquid biopsy today.

[Lauren Chung:]

Got you. Thank you.

[Operator:]

And this concludes our question and answer session. I would like to turn the call back to management for any closing remarks.

[Michael Nall:]

Thank you very much. I want to thank all of you for participating on today's call and for your interest in Biocept. We look forward to sharing our progress on our next conference call in May when we report Q1 financial results. Thank you and have a great evening, everybody.

[Operator:]

The conference has now concluded. We thank you for attending today's presentation and you may now disconnect.