‘Resilient' Pacific Edge announces capital raise
Cancer diagnostics company Pacific Edge has announced a $20 million capital raise in tandem with what it describes as a "resilient" full-year financial result.
In a statement yesterday, the listed company said the equity raising was about ensuring it had the cash reserves to capitalise on recent clinical and commercial milestones, grow in non-Medicare channels and regain Medicare coverage of its tests.
Total revenue was down 16% to $24.6 million while an after tax net loss of $29.9 million was up 1.4%.
Total laboratory throughput of Cxbladder tests fell 11.5% on FY24 to 28,894 while commercial tests fell 9.9%.
Medicare coverage discontinued in April and Pacific Edge was now focused on regaining coverage for its Triage and Monitor products and obtaining coverage and launch of new products Triage Plus and Monitor Plus.
Chairman Chris Gallaher said while the adverse determination was a significant disappointment, it should not overshadow the major strategic progress made over the past year.
Cxbladder Triage was included in the American Urological Association's new microhematuria guideline with a grade-A evidence rating, the only biomarker to receive that level of endorsement.
With the US Centers for Medicare & Medicaid Services (CMS) announcing a draft price of US$1,018.44 for Cxbladder Triage Plus — a significant premium over the current US$760 price for Pacific Edge's existing tests — the company was positioned for "a rapid acceleration of revenue growth" in the United States once Medicare coverage was achieved, Mr Gallaher said.
While confident it would regain coverage for Triage, the company said there were no guarantees as to the timing or outcome of the re-coverage process — it could be delayed or not achieved at all.
Chief executive Dr Peter Meintjes said the AUA guideline cemented Pacific Edge's position as the market leader in non-invasive bladder cancer diagnostics.
In combination with evidence not considered during the finalisation of the determination, the guideline put the company in a strong position to regain Medicare coverage for Cxbladder Triage.
The capital raise comprised a placement of $NZ15 million of new ordinary shares to be offered to selected investors and an offer of $NZ5 million of new shares to retail investors, by way of a share-purchase plan.
The share issue was priced at $NZ0.10 per share.
Mr Gallaher said the new capital would support the company and its operations for over 12 months, giving Pacific Edge the ability to grow testing volume as it worked to regain coverage through planned Medicare reconsideration requests and challenging the non-coverage of Cxbladder Triage through the Medicare appeals process.
All of Pacific Edge's directors and senior management intended to participate in the equity raising.
sally.rae@odt.co.nz
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