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Chembio Diagnostics quarterly loss widens to $2.3M

Profit margins on rapid tests for HIV and other diseases were squeezed in some markets.

Chembio Diagnostic Systems in Medford, seen Oct. 31,

Chembio Diagnostic Systems in Medford, seen Oct. 31, 2016. Photo Credit: Barry Sloan

Chembio Diagnostics Inc. reported a wider loss for the July-September period compared with a year earlier as profit margins on rapid tests for HIV and other diseases were squeezed in some markets, executives said Thursday.

The Medford-based manufacturer lost $2.3 million in the three months ended Sept. 30, compared with a loss of $600,000 in the same period in 2017.

Revenue in the quarter totaled $9.4 million, an increase of 24 percent year over year.

Executives, in an earnings announcement, said the gross profit margin on sales of tests for HIV, syphilis, Ebola, Zika and other illnesses fell 48 percent in July-September to $1.1 million compared with the 2017 period because of production costs and “sales growth in markets with lower average selling prices.”

CEO John J. Sperzel said the company received $16.6 million in net proceeds from its recent stock offering and used about $5 million to purchase opTricon GmbH, a German developer of test results readers.

“We are especially pleased to have completed the first regulatory submission for our DPP test to identify an undisclosed biomarker, developed through our collaboration with AstraZeneca,” the pharmaceutical giant, Sperzel said.

In January, Chembio announced a research collaboration with AstraZeneca to create a test that detects a biomarker or substance that shows a disease or infection is present in the body. Chembio said at the time that it would receive up to $2.9 million from AstraZeneca, the Cambridge, England-based seller of the acid reflux medicine Nexium and other drugs, for the new test.

The announcement came after the stock market closed. Chembio shares rose 7 cents Thursday, or one percent, to close at $7.25 on the Nasdaq Stock Market.


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