"The third quarter was a period of continued strategic transformation for iSpecimen, primarily driven by several key initiatives," said Tracy Curley, CEO of iSpecimen. "First, we completed a 1-for-20 reverse stock split which helped the Company maintain its Nasdaq listing. Additionally, we secured a $1,000,000 loan facility with favorable terms, an agreement which included access to an additional $1,000,000 revolving credit line tied to a future $5,000,000 financing, which we successfully completed on October 31, 2024.”
"I am particularly pleased with the progress and success of our Supplier Refresh program, which is aimed at streamlining our network and focusing on our most productive relationships. In doing so, we have strategically reduced our supplier base this year by 157 suppliers to 75 key suppliers, with an additional 13 new prospects currently in our pipeline. This focused approach has significantly improved the quality and efficiency of our supplier network, while reducing administrative overhead. Combined with our Next Day Quotes program, these initiatives continue to accelerate our sales velocity and enhance conversion rates. These operational improvements, combined with our cost optimization efforts in the third quarter, which included relocating our headquarters and reducing our headcount, are expected to yield over $750,000 in annual savings. As we move closer to a cash flow neutral position we have continued our cost cutting efforts into the fourth quarter. Through November 2024, we have executed additional activities that are expected to yield an additional estimated $2,350,000 in annual savings. In aggregate, these actions provide a solid foundation from which to strengthen our position in the biospecimen industry and drive shareholder value.”
Subsequent Events
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On October 1, 2024, iSpecimen received a notification from Nasdaq stating that the Company had regained compliance with Listing Rule 5559(a)(2) based on the Company maintaining a closing bid price of our common stock was $1.00 per share or greater for 11 consecutive business days.
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On October 31, 2024, iSpecimen announced the closing of a $5,000,000 public offering of the Company’s common stock and pre-funded warrants.
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During the 4th quarter, through November 2024, the Company has continued its cost-cutting efforts that are expected to result in an additional estimated $2,350,000 in annual savings for the Company.
Financial Results for the Three and Nine Months Ended September 30, 2024
For the three months ended September 30, 2023, iSpecimen had revenue of approximately $2,660,000, compared with approximately $2,780,000 for the three months ended September 30, 2023. This result was primarily due to a 39% decrease in average selling price per specimen for the third quarter of 2024, compared with approximately $518 for the same period in 2023. The decrease in the average selling price per specimen was offset by a 58% increase in specimen count to 8,461 specimens for the three months ended September 30, 2024, compared with 5,367 specimens for the same period last year.
For the nine months ended September 30, 2024, revenue increased by approximately $463,000, or 6%, to $7,820,000, from approximately $7,350,000 for the same period in 2023. This was result was primarily due to a 942, or 5%, increase in specimen count, to 19,620 specimens, compared with 18,678 specimens for same period in 2023. The average selling price per specimen also increased by approximately $4, or 1%, to $398 for the nine months ended September 30, 2024, compared with approximately $394 for the same period last year.
For the three months ended September 30, 2024, cost of revenue increased by approximately $162,000 to $1,550,000, compared with approximately $1,390,000 for the same period in 2023. This result was attributable to an approximately 58% increase in the number of specimens accessioned for the three months ended September 30, 2024, compared with the same period in the prior year, offset by an approximately $76, or 29%, decrease in the average cost per specimen for the recent nine month period.
For the nine month period ended September 30, 2024, cost of revenue increased by approximately $586,000 to $3,980,000, compared with approximately $3,390,000 for the same period in 2023. This result was attributable to a $21, or 12%, increase in the average cost per specimen and a 5% increase in the number of specimens accessioned, compared with the same period in the prior year.
For the three month period ended September 30, 2024, general and administrative expenses decreased by approximately $209,000, or 19%, to approximately $893,000, compared with approximately $1,100,000 for same period in 2023. The decrease was attributable to decreases in compensation costs of approximately $172,000, general operating expenses of approximately $71,000, professional fees of approximately $20,000, utilities and facilities expenses of approximately $16,000, and depreciation and amortization of approximately $7,000, partially offset by increases in taxes and insurance of approximately $57,000 and bad debt expense of approximately $20,000.
For the nine months ended September 30, 2024, general and administrative expenses decreased approximately $470,000, or 10%, to approximately $4,050,000 compared with approximately $4,520,000 for the nine months ended September 30, 2023. The period over period decrease was attributable to decreases in compensation costs of approximately $470,000, general operating expenses of approximately $175,000, depreciation and amortization of approximately $51,000, bad debt expense of approximately $37,000, utilities and facilities expenses of approximately $26,000, which were partially offset by increases in taxes and insurance of approximately $148,000 and professional fees of approximately $141,000.
For the third quarter ended September 30, 2024, net loss was approximately $1,440,000, or $(2.10) per share, for the third quarter of 2024, compared with a net loss of approximately $2,110,000, or $(4.66) per share, for the third quarter of 2023. For the nine months ended September 30, 2024, net loss was approximately $6,450,000, or $(11.30) per share, compared with a net loss of approximately $8,030,000, or $(17.78) per share, for the first nine months of 2023.
As of September 30, 2024, cash and cash equivalents, as well as available for sale securities, were approximately $1,750,000, compared with approximately $5,000,000 as of December 31, 2023.
About iSpecimen
iSpecimen (Nasdaq: ISPC) offers an online marketplace for human biospecimens, connecting scientists in commercial and non-profit organizations with healthcare providers that have access to patients and specimens needed for medical discovery. Proprietary, cloud-based technology enables scientists to intuitively search for specimens and patients across a federated partner network of hospitals, labs, biobanks, blood centers and other healthcare organizations. For more information, please visit www.ispecimen.com.
Forward Looking Statements
This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements are characterized by future or conditional verbs such as "may," "will," "expect," "intend," "anticipate," “believe," "estimate," "continue" or similar words. You should read statements that contain these words carefully because they discuss future expectations and plans, which contain projections of future results of operations or financial condition or state other forward-looking information.
Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this press release, including but not limited to the risk factors contained in the Company's filings with the U.S. Securities and Exchange Commission, which are available for review at www.sec.gov. Forward-looking statements speak only as of the date they are made. New risks and uncertainties arise over time, and it is not possible for the Company to predict those events or how they may affect the Company. If a change to the events and circumstances reflected in the Company's forward-looking statements occurs, the Company's business, financial condition and operating results may vary materially from those expressed in the Company's forward-looking statements.
Readers are cautioned not to put undue reliance on forward-looking statements, and the Company assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.
For further information, please contact:
Investor Contact
KCSA Strategic Communications
Phil Carlson
iSpecimen@kcsa.com
iSpecimen Inc.
Condensed Balance Sheets
| | | | | | | |
| | | | | | | |
| | | September 30, 2024 | | December 31, 2023 |
| ASSETS | | (Unaudited) | | | |
| Current assets: | | | | | | |
| Cash and cash equivalents | | $ | 1,751,854 | | | $ | 2,343,666 | |
| Available-for-sale securities | | | — | | | | 2,661,932 | |
| Accounts receivable – unbilled | | | 1,654,019 | | | | 2,212,538 | |
| Accounts receivable, net of allowance for doubtful accounts of $639,116 and $520,897 at September 30, 2024 and December 31, 2023, respectively | | | 974,383 | | | | 728,388 | |
| Prepaid expenses and other current assets | | | 277,579 | | | | 292,079 | |
| Total current assets | | | 4,657,835 | | | | 8,238,603 | |
| Property and equipment, net | | | 102,803 | | | | 127,787 | |
| Internally developed software, net | | | 5,357,188 | | | | 6,323,034 | |
| Other intangible assets, net | | | 764,589 | | | | 908,255 | |
| Operating lease right-of-use asset | | | 342,107 | | | | 193,857 | |
| Security deposits | | | 39,701 | | | | 27,601 | |
| Total assets | | $ | 11,264,223 | | | $ | 15,819,137 | |
| LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | | |
| Current liabilities: | | | | | | |
| Accounts payable | | $ | 4,055,332 | | | $ | 3,925,438 | |
| Accrued expenses | | | 1,022,373 | | | | 1,540,607 | |
| Senior note payable, net of debt discount | | | 864,425 | | | | — | |
| Operating lease current obligation | | | 42,513 | | | | 167,114 | |
| Deferred revenue | | | 283,571 | | | | 415,771 | |
| Total current liabilities | | | 6,268,214 | | | | 6,048,930 | |
| Operating lease long-term obligation | | | 281,437 | | | | 29,130 | |
| Total liabilities | | | 6,549,651 | | | | 6,078,060 | |
| | | | | | | |
| Commitments and contingencies (See Note 9) | | | | | | |
| | | | | | | |
| Stockholders’ equity | | | | | | |
| Common stock, $0.0001 par value, 200,000,000 shares authorized, 831,373 issued and 829,823 outstanding at September 30, 2024 and 455,719 issued and 454,169 outstanding at December 31, 2023 | | | 83 | | | | 45 | |
| Additional paid-in capital | | | 70,530,467 | | | | 69,105,176 | |
| Treasury stock, 1,550 shares, at cost | | | (172 | ) | | | (172 | ) |
| Accumulated other comprehensive income | | | — | | | | 840 | |
| Accumulated deficit | | | (65,815,806 | ) | | | (59,364,812 | ) |
| Total stockholders’ equity | | | 4,714,572 | | | | 9,741,077 | |
| Total liabilities and stockholders’ equity | | $ | 11,264,223 | | | $ | 15,819,137 | |
| | | | | | | | | |
iSpecimen Inc.
Condensed Statements of Operations and Comprehensive Loss
(Unaudited)
| | | | | | | | | | | | | |
| | | Three Months Ended September 30, | | Nine Months Ended September 30, |
| | | 2024 | | | 2023 | | | 2024 | | | 2023 | |
| Revenue | | $ | 2,661,936 | | | $ | 2,777,751 | | | $ | 7,815,608 | | | $ | 7,353,090 | |
| Operating expenses: | | | | | | | | | | | | |
| Cost of revenue | | | 1,554,159 | | | | 1,392,534 | | | | 3,978,557 | | | | 3,393,079 | |
| Technology | | | 754,730 | | | | 921,580 | | | | 2,578,624 | | | | 2,599,086 | |
| Sales and marketing | | | 631,625 | | | | 897,433 | | | | 2,380,515 | | | | 2,972,757 | |
| Supply development | | | 84,972 | | | | 186,176 | | | | 420,322 | | | | 801,038 | |
| Fulfillment | | | 449,142 | | | | 471,735 | | | | 1,293,185 | | | | 1,363,427 | |
| General and administrative | | | 892,712 | | | | 1,102,373 | | | | 4,051,994 | | | | 4,522,028 | |
| Total operating expenses | | | 4,367,340 | | | | 4,971,831 | | | | 14,703,197 | | | | 15,651,415 | |
| | | | | | | | | | | | | |
| Loss from operations | | | (1,705,404 | ) | | | (2,194,080 | ) | | | (6,887,589 | ) | | | (8,298,325 | ) |
| | | | | | | | | | | | | |
| Other income, net | | | | | | | | | | | | |
| Interest expense | | | (7,364 | ) | | | (4,465 | ) | | | (16,303 | ) | | | (11,535 | ) |
| Interest income | | | 1,235 | | | | 67,362 | | | | 40,896 | | | | 292,506 | |
| Other income (expense), net | | | 271,680 | | | | 20,082 | | | | 412,002 | | | | (9,173 | ) |
| Total other income, net | | | 265,551 | | | | 82,979 | | | | 436,595 | | | | 271,798 | |
| | | | | | | | | | | | | |
| Net loss | | $ | (1,439,853 | ) | | $ | (2,111,101 | ) | | $ | (6,450,994 | ) | | $ | (8,026,527 | ) |
| | | | | | | | | | | | | |
| Other comprehensive income (loss): | | | | | | | | | | | | |
| Net loss | | $ | (1,439,853 | ) | | $ | (2,111,101 | ) | | $ | (6,450,994 | ) | | $ | (8,026,527 | ) |
| Unrealized gain (loss) on available-for-sale securities | | | — | | | | (47 | ) | | | (840 | ) | | | 641 | |
| Total other comprehensive income (loss) | | | — | | | | (47 | ) | | | (840 | ) | | | 641 | |
| Comprehensive loss | | $ | (1,439,853 | ) | | $ | (2,111,148 | ) | | $ | (6,451,834 | ) | | $ | (8,025,886 | ) |
| | | | | | | | | | | | | |
| Net loss per share - basic and diluted | | $ | (2.10 | ) | | $ | (4.66 | ) | | $ | (11.30 | ) | | $ | (17.78 | ) |
| | | | | | | | | | | | | |
| Weighted average shares of common stock outstanding - basic and diluted | | | 687,141 | | | | 453,267 | | | | 570,693 | | | | 451,487 | |
