SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): March 16, 2020
(Exact Name of Registrant as Specified in Its Charter)
(State of Incorporation)
(Commission File Number)
(I.R.S. Employer Identification No.)
4 Science Park, New Haven, CT 06511
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(Former name, former address and former fiscal year, if changed since last report date)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
|¨||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))|
|Securities registered pursuant to Section 12(b) of the Act:|
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|Common Stock, $0.01 par value per share||PRPO||The Nasdaq Stock Market LLC|
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.
Emerging growth company ¨
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|Item 7.01||Regulation FD Disclosure|
On March 16 Precipio, Inc. (the “Company”) issued a press release in connection with the company’s completion of a transaction relating to Oncometrix Hematopathology division. The press release is furnished as Exhibit 99.1 and incorporated herein by reference.
The information in this Current Report on Form 8-K, including Exhibit 99.1 attached hereto, is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, nor shall it be deemed subject to the requirements of amended Item 10 of Regulation S-K, nor shall it be deemed incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, regardless of any general incorporation language in such filing. The furnishing of this information hereby shall not be deemed an admission as to the materiality of any such information.
|Item 9.01||Financial Statements and Exhibits|
99.1 Precipio Inc. Press Release March 16, 2020
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.
|By:||/s/ Ilan Danieli|
|Title:||Chief Executive Officer|
Date: March 16, 2020
Precipio Completes the Transaction with Poplar Healthcare’s Oncometrix Hematopathology Division
Customer base and sales team transition to Precipio, Doubling Revenues
NEW HAVEN, CT, (March 16, 2020) – Specialty diagnostics company Precipio, Inc. (NASDAQ: PRPO), announced today that it has completed the non-cash transaction of the transition of Oncometrix’s customer base, as discussed in Precipio’s recent announcement.
As stated previously, the transaction with Poplar involves no upfront exchange of cash or equity in consideration, providing for a non-dilutive transaction. Assuming a continued successful implementation of the transition and no disproportionate impact from COVID-19, management anticipates that the transaction will impact revenue growth, gross margin and cash flow:
|1.||Projected Revenues more than Double. This transaction and Precipio’s current growth initiatives have increased revenue projections for the 2020 Hemepath diagnostic business to more than $6.5M, representing more than 160% increase (or 2.6x) when compared to the 2019 unaudited pathology services revenues of $2.5M.|
|2.||Projected Gross Margin more than Doubles. As a highly scalable, volume-driven business, this growth will have a material impact on Precipio’s laboratory business gross margin. With minimal capital equipment expenditures required to process the increase in volume, we anticipate Hemepath product line gross margins to improve from the current level of 16% to 34%. Furthermore we project incremental Hemepath business above $6.5M to reach estimated margins of 50%.|
|3.||Projected Cash Burn Reduced by more than $800K. While Precipio has absorbed the three additional sales representatives from Oncometrix, as well as several additional hires in laboratory operations to handle the volume increase, it is anticipated that the net cash impact due to this transaction will be an estimated reduction of $800,000 in cash burn on an annualized basis.|
“We are delighted to complete this transaction, partner with Precipio for the hematopathology business, enabling us to focus on our other core businesses”, said James Sweeney, CEO of Poplar Healthcare. “We look forward to continued collaboration with Precipio in other areas of our partnership”.
“While every absorption of a business is challenging, this transaction is an exact fit with current Precipio operations. I am confident in our team’s quick execution of this strategic initiative, and believe it will have a substantial impact on the company”, said Ilan Danieli, Precipio CEO. “We are excited to work with the Oncometrix team and continue to provide their customers and patients with outstanding quality and service; we too look forward to a continued fruitful partnership with the Poplar team”.
Precipio has built a platform designed to eradicate the problem of misdiagnosis by harnessing the intellect, expertise and technology developed within academic institutions and delivering quality diagnostic information to physicians and their patients worldwide. Through its collaborations with world-class academic institutions specializing in cancer research, diagnostics and treatment such as the Yale School of Medicine, Harvard’s Dana-Farber Cancer Institute and the University of Pennsylvania, Precipio offers a new standard of diagnostic accuracy enabling the highest level of patient care. For more information, please visit www.precipiodx.com.
Certain statements in this press release constitute “forward-looking statements,” within the meaning of federal securities laws, including statements related to ICP technology, including financial projections related thereto and potential market opportunity, plans and prospects and other statements containing the words “anticipate,” “intend,” “may,” “plan,” “predict,” “will,” “would,” “could,” “should,” and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors. Factors that could cause future results to materially differ from the recent results or those projected in forward-looking statements include the known risks, uncertainties and other factors described in the Company’s definitive proxy statement filed on May 29, 2018, the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2019 and on the Annual Report on Form 10-K for the year ended December 31, 2018 as well as the Company’s prior filings and from time to time in the Company’s subsequent filings with the Securities and Exchange Commission. Any change in such factors, risks and uncertainties may cause the actual results, events and performance to differ materially from those referred to in such statements. All information in this press release is as of the date of the release and the Company does not undertake any duty to update this information, including any forward-looking statements, unless required by law.
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