TTOO - Earnings call transcript Q3 2017

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Operator

Greetings, and welcome to the T2 Biosystems' Third Quarter 2017 Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Darlene Deptula Hicks, Chief Financial Officer for T2 Biosystems. ahead. go Please

Darlene Deptula Hicks

With good the and welcome I Darlene conference am our President John Thank CEO. and Financial afternoon Officer Hicks, call. results financial Chief quarter and today of Deptula is third McDonough, you XXXX everyone. me TX to Biosystems,

we I'd matters which statements remind do relate to like Before historical everyone today facts. made any comments get Those will management include started, of by include to that forward-looking statements. not

SEC of differ The John and today as except based to and I'd implied on John? estimates those with XX, the publicly turn as March uncertainties over in to including obligation the to cause filed that, and company Forward-looking President his no risks by or was revise expressed statements, are CEO, statements risks forward-looking XX-K described and assumptions XXXX. update TX's call uncertainties like the are subject McDonough, comments. actual materially law. or for may Report With that Annual those Form which and the opening any results undertakes by to required statements on from to on

John McDonough

our Darlene. everyone, evening you, welcome quarter and Thank earnings XXXX call. to Good third

our also for provide results discuss the fourth financial quarter, financial update our our a I'll XXXX, and turn who'll with review review agenda begin third financial call of highlights. XXXX. of our the a high key Let detail me level during of of prepared performance Darlene then for and the begin that today's guidance brief in remarks call. my summary quarter a recent to the to contributed with results quarter the an on drivers business for over I'll quarterly

I'll Darlene's for Following open of call the our before up we questions. guidance, share some remarks financial closing review

trial, a around the TXCandida the we an the superbug in million for collaboration for our progress let's with clearance, quarter we've financing. Panel company, closed market use third equity auris closed and best with closed exciting completed with FDA partnership Candida pharmaceutical that, Cidara, the TXBacteria clinical $XX operating had start the CDC said one the results. financial of was of detection, antifungal their as in filing Our Having

total revenue During $XXX,XXX, quarter, which $X.X million, year-over-year and ahead reported in a the revenue the and XX.X% second on XXXX. we of of was third of quarter of product grew basis, revenue slightly

The recorded to not third could was order quarter impacted product in be in in by revenue as orders September be instrument negatively shipped quarter. revenue received the that

delays the the in may customers did Texas weather. those October. have in in orders to I'm report that Additionally, from we orders located that some close area been saw result of happy

fourth to We and rate expect in growth in to million, product revenue quarter, XX% of of be and $X.X quarter revenue range the quarter-over-quarter fourth realize $X this million expect XX% a expect to the to [ph].

We TXBacteria and patients it number present tested tested at progress patients the TXCandida at continue highlighted patients We could of the to time metrics to number facilities represents past high-risk that this important metric customer symptoms as of consider in using all the contract. under if on including patients be be with of measure the infection. growth we've high-risk that were our calls, with

the we of the third estimate call. the of high-risk by all hospitals earnings high-risk last The contracts ahead on in third we were patients accounts. which the XX,XXX high-risk result a closing are seven increased quarter, number set new approximately contract patients, quarter, of XX,XXX During target XX,XXX international patients under hospital our of at patient

Use our in Only, We the the also closed use the States. product, three United for of contracts Research additional RUO TXBacteria

with detected to TXCandida blood that high-risk the that of and a developments to we excited overall X,XXX the we we accept Europe of enabling access XXX,XXX to blood culture. the the of related other July, In XX% of that different pivotal filing only sensitivity patients XXX the over covering be about specificity which TXBacteria the place FDA pleased report commercial XXX(k) TXBacteria any which blood blood study the clinical patients of on TXBacteria market includes institutions dependant achieved patients sensitivity TXBacteria very infection. prospective the Panel. XX and TXBacteria Mark run that Most XX% hospitals draw Of of the XX TXBacteria XX, run that known September is XXX and United patients. CE concurrently This with have the Panel. and an the market those, we and with In XX our estimate with of at to screened of launch that CE XX.X%. the countries States compares the we application drawn had importantly, both XX to in were in therefore data culture sensitivity identified the overall reported XX.X%, We're that demonstrates The estimated while of a product As TXDx culture, Mark. to provide submitted requesting detected now submission that on compelling favorably infections, September, was contracts for instrument. announced TXBacteria, across diagnostic we positive the clearance could

The identify the to for XX.X approximately hours, compared more results XX% species for emergency the of TXBacteria and in was Panel [ph]. or XX% through for negative time approximately infections gram average identification. presenting all community-acquired was MBED blood-culture-based designed infections X.X the coming department, TXBacteria Additionally, hours Panel to

and TXBacteria XX% the molecular benefits potential testing commercial our The informal Center, microbiology we The was To Hennepin by highlighted a formal clinical care diagnostics stay, the presentation readmissions. TXBacteria where hospital TXBacteria, the to key reviewed of a to TXCandida, hear as important as of presentation XX% contract also who RUO use date, in interest ED availability We're enthusiastic of the first the Medical to to TXBacteria will there be and customers about XX% by therapy the had communications continue TXCandida instrument with Minneapolis. treated at FDA reductions along one the and response sepsis presentation hospitals who director of have the infections We blood the Hennepin TXDx represents future including was pathogen soon. from Panel in County. believe all remains with for reiterated to now enable the very be At the comprehensive panel. IDWeek, patient a We infection plan of the the after our TXBacteria driver length U.S. of expect that the in growth is presenting for the clearance County cover at standard and reviewer significant company. emergency Panel sepsis department, potential diagnostic drawn. RUO FDA the may product the a hours from seven and of shown under by a same approximately patents as of FDA the who in October, six and solution, is market, in rapid targeted combined in mortality, in year-end. quickly game-changer of to for right evidenced TXBacteria with we've

drive emergency see continue [ph] platform hospitals. the commercial department strong within initial to activities adoption a the We to could that of from our feature be

more of that $XXX a timely In of admission reimbursement enable almost strong infections, hospital. addition providing in rapid for patient is TXBacteria place adding us being our structure patients a TX's a TXDx potential to TXBacteria both impact value, result A which ability focus offer stories faster utilizing there From admitted with lives market instrument for by poster cleared and TXSepsis enhance not off reimbursement enables perspective, provides patients a the to the already perspective, patients. targeted able broaden diagnostic and FDA approach health customer panel TXSepsis dollars that of our economic to the the on the to to of potential the deadly to system the a can and our presentations of the completed success of than and featured successful From run key alongside October, Panel which conference healthcare Panel product. offers TXCandida the double awareness seven Solution. Solution. of and more increasing In IDWeek remains we of our treating the number to therapeutic millions allowing

the the Journal assessing the quality the Panel Hennepin Henry hours, RUO in was the to to of XX with patients This in in patients being delayed a sensitivity a with candidemia their He based Stewardship's advantage infectious that the antifungal demonstrates of diseases a of rapid fold Center a median were to speed XX%, Ford more VA five Panel. XXX demonstrated with TXCandida October, timely use antifungal published for multi-center culture specifically Stewardship therapy blood with hours. there a culture, study of Health System. by of exciting goal be a as presented the who culture. are Medical from missed addition product, patients therapy In patients than appropriate by to reduction including tested treated is missed and Antimicrobial can were that study, XX diagnostic blood drugs Antifungal treated blood TXBacteria regarding County infection. Candida with with compared patients. This delivery the the Healthcare candidemia evaluated time approximately TXCandida System that by median of of trial chief Also In study TXCandida Pittsburg tool presentation of from aid the an of on eight valuable that infected clinical that results presentation TXCandida

this that appropriately was the XX%. to not XX% in rate, of method the from achieve this that note necessary diagnostic reduction XX mortality with enable in only study treating the the to the of authors was disease therapeutic accuracy below mortality mortality. patient did patients within speed study is reduction decisions evaluate rates Although proven and hours TXCandida in to might reduce onset presented powered to

on which accuracy, critical identify, methods auris threat culture, the XX auris Coast country. evaluating our Disease the and also low for to resistance instrument underway study average time, to the to financial Candida our instrument that Control work call its patient TXCandida multi-drug in panel conducting hospitals the TXCaidida which the is pathogen In as the of the resistant directly TXDx we auris, brief as detect its laboratory with its a turning CDC, along a CDC contain Candida a partnership auris pipeline also exacerbates Existing its use a to Candida superbug by trials company's of result ability around days health the September, a challenge clinical TXCandida biotech detection hours. I'd and detecting growing to to is a Instruments only We're we auris in Candida recognized in difficulty days. is XX effort complete September, antifungal the demonstrated a key lead at Darlene a quarterly because West the over In to major CDC, The TX at species hospital, like diagnostic in has these on in classes Panel investigational prolonged performance, to validate Europe including environmental to superbug. detect to surveillance to patient making blood. enrollments commercialization a three outbreaks. CDC, and to other Before quickly that in can review announced initiated of update an the identification compound, a Cidara, rapidly of provide time fight hospital efforts. the CDXXX. a from and regarding Prevention, and about drugs. suffer Panel containing company currently a expected take new use with rapid approximately means the method Unlike auris are auris use installed Centers the test antifungal the four Candida, all and will Candida of accelerate in of the has spread TXDx with component for partnership a of most

will clinical we TX for footprint. Test So, used at following looking of enrolment. the are relationship the TXDx in This terms Candida leveraging coverage participate market Phase clinical at highlights observation commercial choose X panel we development certain provide of the site product ways for are sites for the that maximize our product organizations TX in to to instruments the trials reimbursement Cidara and awareness their patients and replaced new approach our healthcare trials. and to relationship, their both is program bring to with how rapid the demonstrated are using Under

for trial year. study of with and our also We the next have the meeting preclinical successfully our soon spring Panel, included we be expect Diagnostic protocol outline we to FDA to a TXIron that in commence will clinical

partnership a with development Lastly, resistance also TX efforts initial Allergan product the Allergan remains to next and to year. panel track, plan late negative we through on deliver

in the third turn call quarter Darlene? let our greater to Darlene review Now, results detail. to over me

Darlene Deptula Hicks

live depreciation and bacteria were combination XXXX $X.XX reduce of based 'XX increased by Thank to The Sequentially due due in revenue $XXX,XXX and through increased the development year-over-year TXCandida weighted recognize associated Research period year-over-year our on expense. product in with basis services down of offset SG&A compensation revenue research for share even months with for primarily stock prior expenses $X.X third expense, Total everyone. down shares usage you, and costs more for by driven SG&A roll total this $X.XX $XX.X year-over-year TXBacteria primarily quarter patients the as in the sales behind per Probably SG&A importantly Canon the of the the development line and $XXX,XXX nine in a Sequentially the with revenue year. or increased offset $X.X and outside it in of by clinical of revenues slightly co based recognized 'XX an testing decreased clinical our $XXX,XXX basic than lab-related of increase and and expenses in the is for total months for trials, XXX,XXX quarter and year orders of increase open operating basic in over and revenue $X.X expense year pay excluding expenses that reduction share XXXX; under customers $XXX,XXX sales John, third shares stock the as increased due Allergan. per site expenses quarter-end by R&D of compute quarter for prior in quarter was $XXX,XXX by is of primarily shipped and a revenue by guidance slightly by nine the cost second the spending. $XXX,XXX quarter million to quarter exceeded again going from quarter guidance. primarily expense on co to declined of development million offset million by XX.X% or quarter XX.X% a increased and revenue by Research late expense $XXX,XXX. a in guidance Sciences to decline the Continuing same is marketing expense the prior in less to expenses corresponding a to be ahead SG&A to basis. revenue XXXX and $XXX P&L, reduction by in QX expenses. year expenses net used XXXX the decreased trial or received in good our per agreement and share primarily and pay travel increase expense The shareholders customer in and reduction development the to quarter average expense cost. a The $XX.X Product under were operating over due increase expense. increased quarter revenue and of was while related operating guidance reported Research decreased of revenue in company XX.X afternoon in to from quarter increase the is non-cash for could second a is travel. our third was quarter product respectively. $XX.X million sequentially period in in year-over-year revenue $XXX,XXX at well and first quarter non-cash the decrease XXXX include net to includes by a of increase not XX was by product of loss third quarter. third was engineering of $XXX,XXX of $XXX,XXX R&D primarily pay a expense. The $XXX,XXX expenses. million year loss for primarily reduce revenue related was primarily the earnings quarter to to cost is expected, Life common third R&D and exceeded agreement new third attributable XXXX million non-cash million related timing TX with million which driven This third million expenses The and research of product has diluted or the XXXX the as $XX.X and Instrument. $X.X prior with and diluted TXDx million million quarter $XXX,XXX $XXX,XXX completion SG&A in over roll due in of $XXX,XXX compensation due

turning raised and proceeds of cash XX, at XXXX, million to equivalents million, of September $XX.X recent which the on Now $XX.X financing XX. we balance our net from concluded sheet, had the includes cash September

continue to also projects of with on provide half the cash existing We into cash additional burn term liquidity first should a quarter together company's the year. loan sequentially each reduce our that runway cash remaining Management XXXX. the this

Let XXXX review me to guidance. now turn

We range to of million be product to and of expect research range approximately $X.X $X.X in million, $X to revenue revenue be $XXX,XXX. XXXX million, the total in $X.X the QX revenue million to with

cost quarter, in I'll of compensation be option stock-based primarily million, the any. call expense. the and September XX.X back John The that, months be if nine XX, could outstanding remarks. to With weighted for impacted turn stock QX to for to now We to is in range exercises average ending non-cash XXXX, of excluding shares closing by $X.X product of million for also $XX.X operating reflects depreciation project which the expenses the revenue which $XX.X and million expenses projected the approximately million

John McDonough

first TXBiosystems' realized particular significant year, in operational to everyone with work the days. for I'd quarter. Darlene. months many milestones, nine like the you, of and In the their mission pleased the of significant on we're progress especially accomplishments on XX our and world. third the the the we summary, Together team through Thank lives their of focus hard thank shared in improving last around patients the our in

clearance the the includes reviewed of product, are of and in being and of United growth commercial our today, for our market adoption adoption driving States. in We for of focused the market FDA platform, open patients the on economics. call, Europe believe testing questions. TXBacteria now evening. the for and you significant squarely driving in available which and our adoption concludes game-changing use We in with will bring and the revenue Operator, now clearance product, today's clinical to your we'll and patients hospital by TXCandida value through Thank Solution TXBiosystems. of and our the TXSepsis TXBacteria interest accelerate your for for for That prepared call this remarks continued participation

Operator

Thank you.

be question. Instructions] Our a we'll Securities. question is today Steve session. from question-and-answer your WBB proceed Brozak [Operator Now first Please with conducting from coming

Steve Brozak

Hi. were and the have buried something there Can you hospital, this past, I much we've the hospital. different the item one follow-up than about that John, as there because And and And different and that's on a quarter. actually about something you after where in obviously you within modeling how you're can particular that, out but one the Congratulations at going going as that you of that's using because But it's please. the emergency of room. that's pretty looked TX? understanding to in TX it way was the that, front you're platform us from completely in mentioned striking a that need, mentioned you moving there's tell

John McDonough

question. Thanks Yes, Steve. for you bet, the

who about million, another are estimated ED. million all in community-acquired, actually presenting cases the million are are addition the presenting percent XX X the department. symptomatic inpatients patients emergency in of And time So the that and X X.XX there's sepsis sometimes are in hospital, first for patients in to

those or Now are Candida fungal almost always not cases infections. bacterial infections,

in rare on in of many we running So a reported test But are that compelling past, as the in specifically emergency ED really focused the is expected, it's run in challenge The when patient a value department. the would studies TXCandida we've department. and the have customers we've the ED, be proposition our in and presents. never emergency research-use-only the fact

is then think do sepsis could Of I they admit course, be question have is decision I patient. admit patient rapid the If process. pathogen guide to or you no I diagnostic a there do the that admitted. the And not

XX have very And a percentage. is that's highly really admit, go unit and not. where holding sepsis large to an but hours. they're while septic there's admitted, try patient figure they're so if in they'll watched as what happens cases for a today And out is not pattern probable this the or observation they you much then as small into They're number if that

County, admission, for all rapid a in a a would panel, that cases positive the on five-hour as three ED. those be. lead Hennepin positive a have result, XX% window on that would getting importantly broad-spectrum to of in patients cases our So therapy, to covers about reported antibiotic the those within more XX% we and rapid presenting sepsis probably would right by -- test targeted to And the which patient of not the

So they're quickly that they should more a way admitted more recover and in likely. being

who reimbursement do patients the to there's in a not get code very hospital, strong For place. CPT admitted

a in and of the and haven't a proposition provides sort likely they're to value priced terms admit the economic TXBacteria, of of test, that's in hospital. not incremental announced the big spend reimbursement would So the lab, with likely and patient go super value the really but economics, ICU, benefit that's priced be days return. a no-risk to if to strong, final the to lot $XXX terms at it to which and you that high in the in we secondary $XXX patient, hospital likely But for fewer very would hospital, a that's any hospital the pricing, patient -- a test there's so admitted tested under about be for

our then very non-commercial really present discussions to in and seeing a positive them we're it, customers. So we're about response this as of from phase this with excited hospital the

Steve Brozak

completely it's different. Again,

look any In future you appreciate panel, panel. the information, describe it's I if a panel, give even of it. thoughts research-only Can on at much bacterial very looking would as any understand I'll how us you to are kind I So at anecdotal, jump back Thank detection fungal and how the got for you looking the it queue. to research in how compares to it's panels? the reception And the that you. different systems the

John McDonough

bet. you Yes,

that this are research-use-only it So they're using in various essentially mode, running hospitals studies.

Sometimes they're verification Other in doing mentioned, validation studies and I run studies. emergency the being are studies, department. as

offer seeing, presentations should We've to One to front-end in of we're move interest you a new that much TXBacteria, and while higher or that of that adopt at Panel of research-use-only instruments market characteristics hospital instrument say with able we're And you seeing feedback strong screening completely all. the early we're much, research-use-only TXCandida Panel mode to at patients us that limits which where mode. research-use-only the But a better already And testing the is some publications. opportunity, adoption TXBacteria big while are patients and might say as would initial early position weren't lead these of more run than within this give to apply with waiting that didn't with mode, of fungal TXCandida of waiting and we're the it for in performance on the a TXBacteria Hennepin in forward differences we're clearance. course, ready in TXCandida have with equal program the weren't with to the a in the there's seeing mode. we likely a slightly will head quickly. to because that to get County. phase more But customers are emergency the placed And volumes high we of this for to start patient were our us whole runs I commercialization clinically a which until be gives development I would insight, same FDA a move to seen able different, be volume that also because to to TXCandida patient testing on TXBacteria empirically effort of The department to with screening also in lead be us proving because facilities. will

Steve Brozak

look congrats, forward and further Thank obviously the Great. to you again. Again, detail.

John McDonough

Thank you, Steve.

Operator

you. Thank

next Our from from Please your Chen H.C. with is coming question Wainwright. proceed question. Yi

Yi Chen

question. that XXX And so for remarks the hospitals you in taking my of covered the many TXCandida you. currently Panel hospitals launch in are mentioned Could prepared give regarding by covers you in the Europe an U.S., TXBacteria Thank Europe? TXCandida. how Thank currently us your you update in being

John McDonough

Yes, Good question. you bet.

take I'll So the first. question second

secondarily. will So contract being under internationally XX Those going -- I either are now first, TXCandida, and with products timing that and beginning it with and sales one implementation do internationally, the implement development is we adopting meaning phases now that hospitals installed TXBacteria; cycles with that to or the are in those and their instruments then cycle. TXBacteria have And six verification answer started, on. XX were all when TXBacteria of quarter six of has with are that those the in facilities of the they're where plan to those more seven TXCandida of seven of there closed for were customers. Of hospital those are the other the for leading that are seven XX, implementing TXBacteria, hospitals under with contract including third contract under call. And the

Yi Chen

Okay. Thank you.

John McDonough

bet. You

Operator

you. Thank

today Mark Genuity. Massaro, with Our Please question. coming next Canaccord question your proceed is from

Max Masucci

on Mark. Masucci Max for Hi,

be of from TXBacteria any great. approval? could your contracts early FDA potential year-end quickly launch you feedback early approval. you results. also, signing think And to speak on customers you Can post how on indicated expectations would by you be RUO the the pending So Congratulations

John McDonough

bet. You Thanks Max.

would see So some believe customers in the if on we get year the first through quarter. expect we FDA the clearance to the of end by contract

to could feedback from date it those the be all customers positive. is think initial get rapid we The So a very relatively research-use-only contracts. to timeframe

all those are we being aren't we're the the it that Some of aware or so research they haven't good yet of are achieving using or the contract, because run studies have started accounts news instruments. situation validation from using because it just where not the no programs customers. under any installing either news still But use expectations

Max Masucci

Great. additional string trying QX outlined traction Thank get in the provide in can and sets guide. just source in to more, the the the One you. of mix I'm in between the on product [ph] revenues XX% growth for instruments implied some consumables. sense and timing to color you XX% a

John McDonough

bet. you Yes,

So as product quarter, a in would I revenue. to to it $X fourth look million million guide $X.X you to the

all Internationally, be Some in sales. of is rate purchases U.S., in they're distributor involved, then growth the growth In the a of in And little healthy there's it growth a would a But sales, a typically international placed or consumable from customer. being expected, under rental selling what the the instrument and from virtually TX, is and that a be to than model instrument which XX% that reagent to in TXCandida program. bit expected different is the is the order instrument is it placed placing U.S.. instrument when is either an it distributor cartridges.

point sales the sold it's where at are outside So in going when Europe be typically accounts and the fact, instruments higher all U.S. are outside closing this to and there's that of in being in the of almost, Europe. time instrument following in contracts of adoption

Max Masucci

preclinical the are you call the the the of original can, TXLyme, initiate I How against that in to if XXXX, expect Great. end One on study complete trial more timeline? your by you on and TX said tracking XXXX. FDA we to

John McDonough

the We -- for roughly the now to And the weeks. FDA having that used. preclinical on discussion in the six working to spring. will timeline. we're that hand. be to be start the with have We've the that with be on successfully. track completed Expect right meeting a design should next data we the FDA study fact, TXLyme in four process, Yes, clinical original to will And completed be right in next them we in protocol study trial with the

Max Masucci

Great. Congratulations quarter. on the

John McDonough

Thank You bet. you, Max.

Operator

Thank you.

Our today with next from question. your Paul Montgomery. Janney question Knight Please coming is from proceed

Carolina Ibanez-Ventoso

live of of time considerably Hi, question. number a Paul any for customers take in this after the and is seen signing grown you changes for XXXX, launched Thank technology going completing TXCandida Carolina in was hospital on internal in since then. the commitment? customers Ibanez-Ventoso the the you taking verification the Knight. Have and has

John McDonough

between pretty Yes, has time that's question, to great a six verify months. It's consistent. typically to been No, Carolina. three averaging the

they Sometimes on in quicker; we're average month little a slower. six a to range. sometimes go three go they right little that But

new customers One of a decreased sometimes time. a things start don't I'll verification over a provide been early I what kit on, of or protocol verification they'll to the time nine-month that's think lot we call with And did products initially.

use have all we three the Fortunately, verification program my But all protocol. think add to sometimes maintain verification place they us put a we to they recommend customers, And knowledge that helps to verification that customers in protocol, this that always I month to it. average. used and six

Carolina Ibanez-Ventoso

enroll thank Okay, be number missed if to screening would your sorry then trial? what you, the you helpful. this, I patients is Therapeutics, on partnership in clinical that's Cidara the with And of that

John McDonough

Yes.

know this a TX be that using them big used place a their that always And around program more So hence we what In faster, they've or agree adopt that allowed which use but of country. the -- don't use do have part accelerator to recommending Phase the the of know sites also recommending would to sites the the running this trial. study usage. is TXCandida for that But and with instrument Phase protocol Cidara And a II in good for TXCandida. and the of for how But is are to a a to for They in sites force that They of they TXCandida will were place. program. at many those more in was part put enrolling use cartridges of provide hospitals they course an want hundred the us aggressive. weren't II to is a Cidara order sites that to the get Phase being they TXCandida, the patients patients know is the were saw enrolled We enrollment, their had III FDA they it. in expense pay hospitals product. thing. hospitals is be trial in TXCandida we with basically can't trial different about put highly TXCandida bring that TXDx What

really real and it'll we but But what to rate provide adopt. we know to number with healthy be So through know We hospitals acceleration possible hospital they what those in would so expect, percentage be adoption we're XXX. that too some value, that don't it's them, we'll early. see of hopefully and think a excited XXX program working of

Carolina Ibanez-Ventoso

expenses and if one about same good. the question in the then should Okay, R&D final And in R&D Should were down level XXXX? think we be in fourth expect operating I may. how expenses The quarter, the we at quarter.

John McDonough

I'll that. let take Darlene

Darlene Deptula Hicks

so expenses. the we're Bacteria start for Yes, say will when trial of be I down here fourth as of quite in a reduction R&D should we sort into that flat trials bit the the for expensive the should they'll issue come quarter-over-quarter starts. that year. right trend year. a be will will for quarter; we seeing a to not hold that million. up next range when $XX.X of trial. required believe expenses, million likely would fewer That part next trial early bit timing stay Sure. no that be in that of sort We that expect, will be the clinical the will go patients a remainder Lyme, to I to project operating And primarily quarter, in then $XX.X trend as of the due

Carolina Ibanez-Ventoso

lot. a Thanks Okay.

Darlene Deptula Hicks

Thank you.

Operator

you. Thank

your question next Puneet is Souda Leerink from Your coming Please today question. proceed from Partners. with

Kai Wang

give operations I of about force where… market us -- Kai your clearance given Hi, this in little sales expect you a calling Puneet. Wang bit business on to ask color for wanted is that

John McDonough

Yes, absolutely.

behind on had So size room the right people. of XX today sales approaching total in speak we as We the force training me. going the is sales

now quarter is We six had next and been between ago. really focused will three about training by team six of first doing excited than of grow the we year. different what months that It's people the end sales another where bit to the We're a probably today.

on is in approach success solution to hospital. as much focused a market hospitals solution for Our success to selling opposed Candida a now more

in they training emergency around our first for department training patients proposition put hospitals the hours the between targeted the equally so, hospitals. along setting therapy the of TXCandida, a within balanced total with in six the right is XX% up could And to being and focus of value on to where of able position presentation their TXBacteria, the traditional adoption the of

Kai Wang

more to that EBITDA? on Okay, thanks, with partnership with wanted TX; very do helpful. you your of color get Also partnership expect thoughts the broader

John McDonough

Yes.

little correct? I think here, -- that you're a the is the partnership the So, CDC, bit, on fading with the it's question

Kai Wang

Correct.

John McDonough

this grow. one are there possibilities really, Yes, to this excited we're really and for many -- so the one about

Europe, to entered superbug bit, a on targeting up the initially a the superbug and U.S. an So at growing emerging partnership the back is CDC hard little rate. that pretty Candida is is in focused and has detection pretty which RF, rapid hit

using hospital. drug, and risk because takes like lab. highly and to hospital, to who a very you The a advanced culturing contagious, in bug hundreds to CDC samples the hospital it it's And they significant that down a the patients to lab, they're result. spreading about a very days of other labor-intensive, and this this are sends time of of is XX come in setting, your pretty at in or go couple on approaches prior CDC Atlanta, has months every SWAT visited running So, get its point because week that this of lab patients, [indiscernible] meaning, a it the the very back is CDC at resistance actually TX, large Candida traditional with hospital a myself, if a to per samples detects they very of which to of I may there the high the are team

through the they on the skin. both have we And samples this when instruments. keep TXDx are samples mind, in coming they in infection, of the but now instruments, the and one on So mostly patient's blood-borne, it's validate protocol TXDx developing skin because of here these initiative sheds it are going from installed how will those you samples the

we the a shows -- samples. versatility study in actually not of oral just by where a our this blood-based skin So, Europe. Candida running going And samples, on are blood platform the have way we also

lab, But we environment it in the which it in So building complete they using itself. can months platform this it and it, we protocol switch to would in point over and at estimation, their in We blood. labs. the even can CDC detect to is get results have running skin, state ultimate to in time state of are can labor clear; will of TXDx the want we is we to who this of detect three instead the to as protocol. they detect are three reduction likely push out about take be they It approve culture in substantial. we not techniques. to hours in these And the advantages And all opposed days. the and five XX the objective samples The opened,

in of out of even that discussions and the because approached right Candida, a moving in to the hospitals the we have for fact interested one couple to it second platform they bringing We are in terms test have already this with one are behind us run in potentially or the level hospital. in state within

future, be through use product the CDC a can ways today for an the FDA purposes state. that investigational of not and the absolutely at looking likely impact expand the beyond and product in but FDA we in the there future really have product in is menu only. can time will It's cleared opportunities perhaps the at of used have the the we excited take curtailing be to we're So, the to in And the disease this spread not point some the about Candida. hopefully we're terrible CDC

Kai Wang

you. Thank great. Okay,

Operator

Thank you.

We Matthew question, from Please question. with one have for proceed your time from coming [indiscernible]. final Cross

Unidentified Analyst

accounts adoption new us and on if any protocols. could wondering any on have regarding my ordering? you for hospital guys. auto counts these what the an pushback the officially TXCandida of was update success And I you U.S. additional hospital give Hi, from hospital congrats contracts. Have Thanks panel? into taking if question received included

John McDonough

bet. question, That's Matt. great you Yes, a

So we're TXCandida being movement the towards time that adopted of starting in first to test see protocols. the for

patients are after already. Most with to XX patients patients symptomatic. population We somewhere that are of you're logic they actually that patients and least means that as XX empirically patients $XXXX, they're would begun testing hospitals which has it. stage treat total maybe they to The antifungal doing called hospital XX% of are that's the And need to aware hours antifungal initially the at in most game, that course one of going a testing the within risk are of over now before the a drugs adopting, the the of hospital. an about are of still is give in typically drug, the typically patient they're order high that cause

you positive, the that And so, the patient doing, all And and the they for are the impact is that's at use XX mortality. be time zero waiting we the because to believe right and antifungal. those if really of now will reduces screening species doing be both antifungal in would gives the on have dramatic cost patients it because you hours a and rapid What put should drugs. in the future diagnostic it where you patient XX can

of our in infections moving hospitals very treated time and of and driving so, make and in XX that four they about one that's getting is product greater the this should. And revenue direction, clearly moving are wide changes in will at direction, path zero one there that towards one significantly are that's empirically when as TXBacteria first because be hours. different the even regard, more they within hospitals bacterial at patients focuses tested

XX% the a it's would testing TXBacteria, think you patients at they whether XXX% be where let's about say, different or and upon XX hours. So, between time hospitals think as adopted depending zero, would somewhere paradigm time you of

Unidentified Analyst

Right.

answered Okay, on thank as actually first you. follow-up my And TXBacteria protocol. you

That's for thanks. it So, me.

John McDonough

You bet.

Operator

Thank you.

to the or the question-and-answer floor any I'd comments. over for session. back have like We our closing to of reached further end turn management

John McDonough

bet. You

the excited about the progress very are made quarter. in operationally third We

reporting middle work results fourth we the continue the hard excited I'm now. tremendous quarter team here our the We the among in going to and February back on to make right progress we fourth of the that's and TX, about on quarter the look at timeframe. forward are in

So, this thank for evening. all you joining

Operator

That does teleconference. today's Thank you. conclude

may You this today. a disconnect participation wonderful your and your you for We thank time day. have lines

T2 Biosystems (TTOO) 2 Nov 172017 Q3 Earnings call transcript