htgm-8k_20190307.htm

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

March 7, 2019

Date of Report (Date of earliest event reported)

 

HTG Molecular Diagnostics, Inc.

(Exact name of registrant as specified in its charter)

 

 

Delaware

 

001-37369

 

86-0912294

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

 

3430 E. Global Loop

Tucson, AZ

 

85706

(Address of principal executive offices)

 

(Zip Code)

Registrant’s telephone number, including area code: (877) 289-2615

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

 

 

 


 

Item 2.02 Results of Operations and Financial Condition

On March 7, 2019, HTG Molecular Diagnostics, Inc. issued a press release announcing its financial results for the year ended December 31, 2018. A copy of this press release is attached hereto as Exhibit 99.1.

The information in this Item 2.02 and the attached exhibit are being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

 

Exhibit

No.

 

Description

 

 

 

99.1

 

Press release of HTG Molecular Diagnostics, Inc. dated March 7, 2019

 

 


 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

HTG Molecular Diagnostics, Inc.

 

 

 

 

 

Dated: March 7, 2019

 

By:

 

/s/ Shaun D. McMeans

 

 

 

 

Shaun D. McMeans

 

 

 

 

SVP and Chief Financial Officer

 

 

htgm-ex991_6.htm

 

Exhibit 99.1

 

FOR IMMEDIATE RELEASE

 

HTG Molecular Diagnostics Reports Full Year 2018 Results

 

Revenue increased 46% in 2018 compared to the prior year reflecting continued success growing the company’s profiling business with Pharma company customers

 

 

TUCSON, Ariz., March 7, 2019 -- HTG Molecular Diagnostics, Inc. (Nasdaq:HTGM) (HTG), a life science company whose mission is to advance precision medicine, today reported its financial results for the year ended December 31, 2018.

 

 

Recent Accomplishments & Highlights:

 

 

Achieved revenue of $21.5 million for the year ended December 31, 2018, representing a 46% increase over fiscal 2017. This increase was driven by the expansion of the company’s profiling services business and further progress on our collaborative development programs.

 

 

Established HTG Molecular Diagnostics France, SARL (“HTG France”), a wholly-owned French subsidiary, encompassing an applications laboratory in Sausheim, France. HTG France is expected to facilitate HTG’s ability to generate molecular diagnostic revenue in Europe and to improve our responsiveness to our growing customer base in Europe.

 

 

Entered into an amendment and extension to HTG’s second precision diagnostic partnership program under the company’s Master Assay Development, Commercialization and Manufacturing Agreement with QIAGEN Manchester Limited in February 2019.

 

 

Expanded HTG’s molecular diagnostic leadership team to include Dr. Maureen Cronin, CSO, and, most recently, Laura Beggrow, President, Diagnostics, and also made several, experienced development team hires, expected to be based in a San Francisco Bay Area California facility.

 

 

“We entered 2018 with the momentum of our collaboration program success and determined to grow our profiling business further, by accelerating customer adoption, expanding our Biopharma pipeline, initiating commercialization of our CE/IVD products in Europe and strengthening our balance sheet. In 2019 we plan to leverage our 2018 momentum to expand our base profiling business and execute on our diagnostic programs,” said TJ Johnson, CEO of HTG.


 


Full Year 2018 Financial Results; 2019 Guidance:

Revenue for the year ended December 31, 2018 was $21.5 million, compared to $14.8 million for the year ended December 31, 2017.

Cost of product and product-related services revenue for the year ended December 31, 2018 was $5.1 million, compared to $5.0 million for the year ended December 31, 2017. In addition, costs relating to our collaborative development services revenue, which are included in research and development expense in HTG’s consolidated statements of operations, were approximately $8.0 million for the year ended December 31, 2018, compared to $4.8 million for the year ended December 31, 2017.

Net loss from operations for the year ended December 31, 2018 was $16.2 million, compared to $17.7 million for year ended December 31, 2017. Net loss for the year ended December 31, 2018 was $16.5 million, compared to $19.0 million for the year ended December 31, 2017. Net loss per share for the year ended December 31, 2018 was $(0.60) compared to $(1.79) for the year ended December 31, 2017.

HTG ended 2018 with $31.1 million in cash, cash equivalents and short-term available-for-sale securities and current liabilities of approximately $7.0 million plus an additional $15.7 million in non-current liabilities. An additional $3.3 million of restricted cash was held in connection with the convertible note that is included in non-current liabilities as of December 31, 2018.  

 

HTG is providing Q1 2019 revenue guidance of $2.5 million to $3.0 million and full year revenue guidance of $23.0 million to $28.0 million for 2019.

 

 

Conference Call and Webcast:

HTG will host an investment community conference call today beginning at 4:30 p.m. Eastern Time. Conference call and webcast details follow:

 

Date:

 

Thursday, March 7, 2019

Time:

 

4:30pm Eastern Time

Toll Free:

 

(877) 407-0789

International:

 

(201) 689-8562

Conference ID:

 

13687663

Webcast:

 

http://public.viavid.com/index.php?id=133300

 

 

About HTG:

HTG is focused on advancing precision medicine. The company’s proprietary HTG EdgeSeq technology automates complex, highly multiplexed molecular profiling from solid and liquid samples, even when limited in amount. HTG’s customers use its technology to identify biomarkers important for precision medicine, to understand the clinical relevance of these discoveries, and ultimately to identify treatment options.

 

 

Safe Harbor Statement:

 

Statements contained in this press release regarding matters that are not historical facts are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding the expected benefits of our French subsidiary and our revenue and operational expectations for 2019. Words such as “believes,” “anticipates,” “plans,” “expects,” “intends,” “will,” “goal,” “potential” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements necessarily contain these identifying words. These forward-looking statements are based upon management’s current expectations, are subject to known and unknown risks, and involve assumptions that may never materialize or may prove to be incorrect. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of various risks and uncertainties, including, without limitation, the risk that our French subsidiary and operations may not provide the expected benefits, the risk that we may not achieve our revenue guidance for Q1 2019 or the full year 2019 (including, without limitation, due to variations from our expectations in the amount or timing of


work we perform under one or more companion diagnostic development programs with pharma customers, which development programs comprise an increasing portion of our business and therefore have the ability to significantly impact the timing and amount of revenue recognized in one or more fiscal periods), the risk that we may not realize the benefits expected under our collaboration agreements, risks associated with our ability to successfully commercialize our products; the risk that our products and services may not be adopted by biopharmaceutical companies or other customers as anticipated, or at all; our ability to manufacture our products to meet demand; the level and availability of third party payor reimbursement for our products; our ability to effectively manage our anticipated growth; our ability to protect our intellectual property rights and proprietary technologies; our ability to operate our business without infringing the intellectual property rights and proprietary technology of third parties; competition in our industry; additional capital and credit availability; our ability to attract and retain qualified personnel; and product liability claims. These and other factors are described in greater detail in our filings with the Securities and Exchange Commission, including without limitation our Annual Report on Form 10-K for the year ended December 31, 2018. All forward-looking statements contained in this press release speak only as of the date on which they were made, and we undertake no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made.

 

 

-Financial tables follow-



HTG Molecular Diagnostics, Inc.

 

Consolidated Statements of Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Years Ended December 31,

 

 

 

2018

 

 

2017

 

Revenue:

 

 

 

 

 

 

 

 

Product and product-related services

 

$

9,121,390

 

 

$

6,797,255

 

Collaborative development services

 

 

12,382,504

 

 

 

7,962,312

 

Total revenue

 

 

21,503,894

 

 

 

14,759,567

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

     Cost of product and product-related services revenue

 

 

5,090,475

 

 

 

4,971,806

 

     Selling, general and administrative

 

 

19,974,616

 

 

 

17,513,742

 

     Research and development

 

 

12,598,034

 

 

 

9,996,627

 

Total operating expenses

 

 

37,663,125

 

 

 

32,482,175

 

Operating loss

 

 

(16,159,231

)

 

 

(17,722,608

)

Loss on settlement of Growth Term Loan

 

 

(105,064

)

 

 

 

Interest income (expense)

 

 

(186,097

)

 

 

(1,234,488

)

Net loss before income taxes

 

 

(16,450,392

)

 

 

(18,957,096

)

Provision for income taxes

 

 

3,526

 

 

 

2,921

 

Net loss

 

$

(16,453,918

)

 

$

(18,960,017

)

 

 

 

 

 

 

 

 

 

Net loss per share, basic and diluted

 

$

(0.60

)

 

$

(1.79

)

Shares used in computing net loss per share, basic and diluted

 

 

27,523,463

 

 

 

10,597,318

 

 



HTG Molecular Diagnostics, Inc.

 

Consolidated Balance Sheets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

 

 

2018

 

 

2017

 

Assets

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

8,432,600

 

 

$

9,968,600

 

Short-term investments available-for-sale, at fair value

 

 

22,681,049

 

 

 

 

Accounts receivable

 

 

5,012,678

 

 

 

6,356,268

 

Inventory, net

 

 

1,306,609

 

 

 

1,180,521

 

Prepaid expenses and other

 

 

568,209

 

 

 

443,068

 

Total current assets

 

 

38,001,145

 

 

 

17,948,457

 

 

 

 

 

 

 

 

 

 

Restricted cash - non-current

 

 

3,270,247

 

 

 

 

Deferred offering costs

 

 

59,030

 

 

 

2,953

 

Deferred MidCap revolving loan costs

 

 

67,068

 

 

 

 

Property and equipment, net

 

 

2,373,790

 

 

 

3,304,890

 

Total assets

 

$

43,771,280

 

 

$

21,256,300

 

 

 

 

 

 

 

 

 

 

Liabilities and stockholders' deficit

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

1,849,921

 

 

$

2,438,798

 

Accrued liabilities

 

 

3,358,465

 

 

 

3,746,786

 

Contract liabilities - current

 

 

332,711

 

 

 

665,882

 

NuvoGen obligation - current

 

 

1,290,234

 

 

 

496,442

 

Growth Term Loan payable - net of discount and debt issuance costs

 

 

 

 

 

5,793,599

 

Other current liabilities

 

 

186,043

 

 

 

200,460

 

Total current liabilities

 

 

7,017,374

 

 

 

13,341,967

 

NuvoGen obligation - non-current, net of discount

 

 

5,702,519

 

 

 

7,520,913

 

Convertible note, related party - net of debt issuance costs

 

 

2,974,213

 

 

 

2,960,760

 

MidCap Term Loan payable - net of discount and debt issuance costs

 

 

6,704,641

 

 

 

 

Other non-current liabilities

 

 

280,471

 

 

 

492,197

 

Total liabilities

 

 

22,679,218

 

 

 

24,315,837

 

Commitments and Contingencies

 

 

 

 

 

 

 

 

Total stockholders’ equity (deficit)

 

 

21,092,062

 

 

 

(3,059,537

)

Total liabilities and stockholders' equity (deficit)

 

$

43,771,280

 

 

$

21,256,300

 



Contact:

 

Ashley Robinson

LifeSci Advisors, LLC

Phone: (617) 535-7742

Email: arr@lifesciadvisors.com