Nanosphere, Inc. (NSPH)
Q3 2008 Earnings Call
November 10, 2008 5:00 pm ET
Bill Moffitt - CEO
Roger Moody - CFO
Mike McGarrity - Chief Marketing Officer
Scott Gleason - Stephens
Bruce Cranna - Leerink Swann
Bill Quirk - Piper Jaffray
Katherine Xu - Credit Suisse
Previous Statements by NSPH
» Nanosphere, Inc. Q4 2008 Earnings Call Transcript
» Nanosphere, Inc. Q2 2008 Earnings Call Transcript
» Nanosphere Incorporation Q1 2008 Earnings Call Transcript
Before the call begins, Nanosphere would like to state that certain statements made during this conference call which are not based on historical facts, maybe deemed to constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Because these forward-looking statements involve known and unknown risks and uncertainties, there are important factors that could cause actual results, events or developments to differ materially from those expressed or implied by these forward-looking statements.
Such factors include those described from time-to-time in the Nanosphere's filings with the United States Securities and Exchange Commission, including without limitations the risks described in Nanosphere's most recent quarterly report on Form 10-Q on file with the SEC. Please note that Nanosphere undertakes no duty to update this information.
I would now like to turn the presentation over to your host for today's call Mr. Bill Moffitt, Chief Executive Officer. Please proceed sir.
Thank you, Crysta. Good afternoon everyone and thank you for joining us for Nanosphere's investor conference call, covering the third quarter. In a few moments I will turn the call over to Roger Moody, Chief Financial Officer of the company, who will review the results we released this afternoon; and to Mike McGarrity, Chief Marketing Officer of the company, who will provide an update on our customer activities and sales and marketing programs.
Before turning the call over to Roger and Mike, I would like to discuss with you the progress that we are making in product development and building our business. As we discussed last quarter, our business growth is driven by test menu expansion.
Our currently clearly assays for hyper-coagulation and warfarin metabolism continue to generate customer interest, but we do not expect to see accelerated growth until we expand our test menu. In that regard, we continue to make notable progress on a broad number of fronts.
Let me take you through some of those and how we expect our pipeline of products to enable us to accelerate market penetration. Our nucleic acid product development programs encompass additional human genetic assays and infectious disease tests, while our protein test menu is driven first by cardiac troponin with additional assays in feasibility.
In the Human Genetics market segment, we have filed a 510(k) submission with the FDA for our cystic fibrosis assay comprising the panel of mutations recommended by the American College of Medical Genetics and the American College of Obstetrician Gynecology.
The market for this assay is approximately 1.8 million tests per year and we anticipate an average sell price target of about $65. This assay demonstrates the unique high count multiplex capability of our nanotechnology based Verigene System and offers our customers the ease of use associated with our random access cartridge format.
We have also filed a 510(k) with the FDA for our first infectious disease assay, a panel of respiratory viruses for the detection of influenza and RSV. In clinical trials to support the FDA submission, we believe our data demonstrate this assay to be superior to others on the market today. This first generation assay requires external sample preparation by the customer before proceeding to the Verigene System.
A second generation assay that will run on the Verigene II System will provide complete sample-to-result automation. In a few moments, Mike McGarrity will give our review of the market opportunity for this test.
Other product development programs continue on track. We are completing the validation and verification studies for our HFE assay in preparation for clinical trials later this quarter. Mutations in the HFE gene are the leading cause of hemochromatosis, the excess absorption of iron by the body, which leads to diseases such as cirrhosis to the liver, liver cancer, thyroid cancer, diabetes, pancreatic cancer, renal failure and heart attack.
When we receive FDA clearance to market this test, we will be the only FDA cleared assay on the market. While today this is not a huge market, the potential is significant. Since one in 250 has this disease and one in eight is a carrier of one or more of the mutations. Although more prevalent than cystic fibrosis, HFE is not that well known, but awareness is on the rise. A number of customers in our pipeline are awaiting this test.
Looking at how our instrument platform continues to develop, the Verigene II incorporating complete sample to resolve automation remains on track with the targeted release in the back half of 2009. Our regulatory plan is to submit first for human DNA extraction in support of our previously cleared genomic assays and then develop all future genomic and infectious disease assays on this platform.
The first infectious disease assay we plan to bring to market on the Verigene II will be the second generation respiratory panel. Although all versions of the Verigene System will run protein assays, many of the subsystems in the Verigene I and the Verigene II are not required for protein test.