Start Time: 16:30 January 1, 0000 5:18 PM ET
OpGen, Inc. (NASDAQ:OPGN)
Q4 2019 Earnings Conference Call
March 24, 2020, 16:30 PM ET
Company Participants
Evan Jones – Chairman and CEO
Tim Dec – CFO
Oliver Schacht – CEO Curetis
Joe Green – Managing Director of IR
Conference Call Participants
Yi Chen – H.C. Wainwright
Ben Haynor – Alliance Global Partners
Maxim Jacobs – Edison Group
Bruce Jackson – The Benchmark Company
Operator
Ladies and gentlemen, thank you for standing by. Welcome to the Fourth Quarter 2019 OpGen, Inc. Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions]. Please be advised that today’s conference is being recorded. [Operator Instructions].
It is now my pleasure to introduce Managing Director of Investor Relations, Joe Green.
Joe Green
Thank you, operator. Welcome to the OpGen fourth quarter and full year 2019 earnings call and business update. At this time, all participants are in listen-only mode. Following the management prepared remarks there will be a Q&A session. As a reminder, this conference is being recorded today, March 24, 2020.
Before we begin, I would like to caution you that comments made during this conference call by management may contain forward-looking statements regarding the operations of and future results of OpGen as well as the combined business of OpGen and Curetis following the closing of the business combination transaction.
I encourage you to review OpGen’s filings with the Securities and Exchange Commission, including, without limitation, the company’s most recent Form 10-K, which identify specific factors that may cause actual results or events to differ materially from those described in the forward-looking statements.
Factors that may affect the company’s results include, but are not limited to, our ability to successfully combine the business of OpGen and Curetis; achieve the expected synergies and implement the combined company strategy; the impact of the current global coronavirus pandemic on our business and operations; our use of proceeds from the at-the-market offering that we commenced in February 2020 as well as the proceeds from recent warrant exercises; pursuit of FDA clearance for the Acuitas AMR Gene Panel for use with bacterial isolates and for our other products and services; the rate of adoption of our products and services by hospitals and other healthcare providers in general as well as in the current coronavirus pandemic situation in particular; the success of our commercialization efforts; the effect of our business of both existing and new regulatory requirements; and other economic and competitive factors.
The content for this conference call contains time-sensitive information that is accurate only as of the date of this live call, March 24, 2020. The company undertakes no obligation to revise or update any statements to reflect events or circumstances after the date of this conference call, except as required by law.
Joining the call today will be Evan Jones, Chairman and CEO; and Tim Dec, CFO of OpGen; as well as Oliver Schacht, CEO of Curetis who will be available for the question-and-answer session.
At this time, I would now like to turn the call over to Evan Jones, Chairman and CEO of OpGen.
Evan Jones
Thank you, operator, and thank you everyone for joining us this afternoon. On today’s call, we will provide a business update and discuss the status of the business combination between OpGen and Curetis. We will discuss recent activities and developments with regard to the global COVID-19 pandemic and provide a brief review of result for OpGen’s fourth quarter and full year 2019 financial results.
I want to welcome Oliver Schacht, CEO of Curetis to our call this afternoon. Oliver will be taking over as CEO of the combined company after the transaction close in early April. In September 2019, we entered into an implementation agreement with Curetis N.V. under which we agreed to acquire the business assets of Curetis GmbH, a subsidiary of Curetis N.V. to create a combined business with OpGen.
In connection with the transaction, we called a special meeting of stockholders originally scheduled for March 10 and adjourned to March 30 in order to approve the combination. As announced earlier today, we have received sufficient votes to establish quorum for our reconvened special meeting on March 30 in order to approve the business combination of OpGen with Curetis.
The votes received today are 99% in favor of the combination and we anticipate closing the transaction by early April. This is an exciting moment for our two companies. We have already demonstrated the synergies and benefits of combining our businesses and we expect to see more benefits in the immediate future.
I would like to begin my comments by discussing the global COVID-19 pandemic and how it is impacting our business. From the initial announcement by the Chinese government of the COVID-19 outbreak in December to the identification of the first case in the United States on January 24 of this year, things have moved very quickly.
I’m sure all of you have been following the daily updates with regard to the virus and the global efforts to fight it. Government regulations and directives impacting every aspect of our lives and our business have been established over the last 60 days, including shelter in place, the closing of national borders and worldwide travel restrictions.
Impacts from individuals who may test positive or who are at risk for the virus have impacted our work environment and supply chain disruptions are a rising concern. The hospital environment has become very challenging. Hospitals are canceling elective surgeries and are implementing emergency preparedness plans to deal with the rapidly evolving pandemic.
In this environment, it has become increasingly difficult to speak with healthcare professionals regarding any matters that are not related to helping manage the COVID-19 pandemic. The U.S. government has projected that the pandemic could last 18 months or longer and could include multiple waves of illness.
We have adopted this worldview as our working case and we are adjusting our operations and business practices to capitalize on opportunities to help assist in the fight against the virus and to prepare for the tough times our society is facing. Fortunately, the big picture outlook for the company is strong and we have a positive outlook for the business as we emerge from the near-term global crisis.
The tragic COVID-19 pandemic further emphasizes the need for infectious disease precision medicine solutions such as rapid DNA and RNA testing. Curetis recognized this need early and is now participating as a first mover in Europe supplying rapid PCR test kits, develop and CE-IVD marked by a strategic partner BGI.
The first shipment of kits by BGI have been received and Curetis is processing orders for thousands of tests with first shipments being made to distribution partners in Europe. Curetis has been receiving significant inbound interest from labs, clinicians and distribution partners in the European Union, Middle East and Africa, as well as the Asia-Pacific regions.
Across both of our companies, we are taking steps to capitalize on this initial success by adjusting our product development efforts to bring products and services to market as quickly as possible that could help mitigate the impact of the COVID-19 crisis. The products and services could include new rapid PCR test capabilities, bioinformatics and potentially DNA sequencing offerings.
Late last year, Curetis received FDA clearance for an expanded labeling claim for its Unyvero Lower Respiratory Panel to include the use of bronchoalveolar lavage specimens, or BAL, and testing for Pneumocystis in addition to a broad range of bacterial pathogens and antibiotic resistance markers.
This makes the Unyvero LRT BAL test uniquely differentiated and the first and only FDA cleared test which includes this key pathogen relevant especially in immunocompromised patients. This new indication substantially increases the total addressable market for the Unyvero system in the United States.
The overall business outlook for this exciting new product is currently transforming. Hospitals and health systems preparing for the immediate COVID-19 crisis appear to be focusing entirely on this matter and new Unyvero system installations and many new planned evaluations have been pushed out to free hospital and laboratory resources.
Conversely, with the expected surge in hospitalized COVID-19 patients in ICUs globally, many of them on ventilators, and the anticipated rise in bacterial pneumonia as a likely complication and comorbidity in many cases, the Unyvero Lower Respiratory Tract test could become an important tool for hospitals combating the anticipated surge in acutely ill patients.
In Europe and other regions hit hard by the pandemic, there are increasing numbers of expressions of interest to use the Unyvero test to help manage patients at risk for life-threatening bacterial co-infections. As a result, additional placements of Unyvero systems are anticipated and Curetis is developing structured programs to help address this critical need.
Knowing the pathogen ID and antimicrobial resistance profile is key to selecting antibiotics for these patients. Time is of the essence in triaging patients. Bacterial culture can take days compared with just four to five hours for the Unyvero test. In addition, we are evaluating the medical need for a potentially new product with SARS-CoV-2 added to the current Unyvero LRT BAL panel. In the U.S., the path to market would be accelerated through the recently expanded FDA emergency use authorization pathway.
I will now turn the call over to Tim Dec who will review financial results for 2019 and recent financial developments for the business. Tim?
Tim Dec
Thank you, Evan. On today’s call, I will touch briefly on the highlights of the fourth quarter and the full year 2019 financial results. Total revenue for the 12 months ended December 31, 2019 was 3.5 million compared with 2.9 million in 2018, an increase of approximately 19%. Fourth quarter revenue was 821,000 compared with 759,000 in the prior year period, an increase of approximately 8%.
Total operating expenses for the 12 months ended December 31, 2019 were 15.8 million as compared to 16.1 million for 2018. If you exclude the transaction fees associated with the Curetis business combination of 800,000 and the impairment of the right-of-use asset of 500,000, our operating expenses for 2019 would have been 14.5 million or a 10% reduction in our operating expenses year-over-year.
Net loss for the year was $12.4 million or $7.70 per share as compared to $13.4 million or $44.49 per share in 2018. Since our last call in October, we have been working weekly, if not daily, with the Curetis team on preparations to integrate the two organizations.
Numerous key executives and team members have been back and forth across the Atlantic to ensure we will be prepared to move forward immediately as the business combination comes together. We have formalized a post closing combination of the Board. Our internal executive management team identified other key senior members of the team and identified numerous synergistic financial opportunities.
As Evan mentioned, we expect the combination to be approved by our OpGen shareholders next Tuesday on March 30, Monday rather. Approximately 2.66 million new OpGen shares will be issued to Curetis N.V. as sole consideration for the purchase of Curetis GmbH at the closing.
In the transaction announcement, we estimate combined pro forma 2019 revenue would be in the $5 million to $6 million. We are pleased to say that our pro forma revenue for 2019 would have been at the high end of that range or $6 million. We have previously publicly stated that we expect our 2020 revenue to grow. Due to the current global pandemic situation, we will not be providing revenue or any other guidance at this time.
For those that did not listen to our last call, I would like to point to a number of key items that support the rationale for this strategic business combination. First, Curetis brings a strong U.S. sales and marketing team and the two companies together have significant potential revenue synergies.
Secondly, Curetis has a dedicated international commercial distribution partnership network and a strong support team. Third, Curetis has a state-of-the-art 16,000 square foot clean room for test manufacturing that is outfitted with robotic technology and has been FDA inspected. With historic capital investment approaching $10 million, we anticipate these capabilities will help to bring our AMR Gene Panel to market with lower incremental cash burn.
Fourth, Curetis with Ares Genetics has advanced bioinformatics capabilities that can be leveraged to integrate both companies’ AMR databases, data analytics and reporting platforms. And finally, our preliminary annual cost saving estimates when comparing against 2019 pro forma combined actuals are in the 15% to 20% range, potentially even higher as we work to identify other areas of savings post combination.
I would like to conclude my prepared remarks by updating everyone on our cash position. During the past five to six weeks, we have seen tremendous volume in our stock. Our average daily trading volume is currently over 3 million shares per day with a high share price achieved a week ago at $5.76.
We are encouraged to see the company’s stock price respond to our work to help address the coronavirus pandemic and the increased certainty that the OpGen-Curetis business combination will be completed successfully. Because of that positive support for our stock and the business combination, we have raised approximately $13.2 million since mid-February through both our ATM and exercises of the $2 per share warrants issued in our October 2019 public offering.
Additionally, our shelf capacity has been increased by approximately $11.5 million. We recently filed a prospectus supplement last week to increase the capability under our ATM thus providing additional access to capital on a selective basis at the appropriate time over the coming months and quarter.
This capacity can be used during calendar 2020 to support the combined operations of OpGen and Curetis following closing of the business combination. With more than approximately 22.6 million of capital raised over the last six months, our balance sheet is in a solid position as we look to combine the two organizations.
With that, I’ll turn the call back to Evan to discuss additional key milestones.
Evan Jones
Thank you, Tim. For the next part of the call I will comment on some of the key OpGen and Curetis development programs and commercial activities. Last May, we submitted the Acuitas AMR Gene Panel isolates 510(k) to the FDA. The agency responded in July 2019 with extensive questions in what is called an Additional Information Request letter.
In early January 2020, we submitted formal responses to the majority of the agency’s questions after which we received additional questions from the FDA in mid-January. Through the first quarter, we have continued to respond to the questions posed by the agency.
OpGen is continuing to work with the FDA to address additional questions that have arisen during the interactive review process. The FDA shared with OpGen a working plan to complete the FDA’s review of the Acuitas AMR Gene Panel isolate 510(NYSE:K) submission. However, we anticipate delays to the planned timeline as a result of the ongoing COVID-19 pandemic.
Consequently, the anticipated timeline for the remainder of the second interactive process review and ultimately the clearance for the Acuitas AMR Gene Panel isolate diagnostic test is currently unknown, although we anticipate that the extensive review process is nearing completion.
We began accruing samples for the Acuitas AMR Gene Panel urine de novo clinical trial in December and by early March we had all nine centers accruing urine samples per enrollment and the completion of the clinical trial was anticipated by mid spring given the rate of accruals.
Unfortunately as a consequence of the COVID-19 pandemic, our clinical trial sites have notified us that they will be suspending clinical trial activities until the COVID-19 situation is under control. We currently estimate that this program freeze could last until early summer as the clinical laboratory sites focus on efforts to bring laboratory testing and services to support the COVID-19 pandemic.
We’ve seen a similar situation with the New York State digital health initiative. OpGen completed planned milestones in the groundbreaking collaboration with New York State Department of Health and ILÚM Health Solutions, a wholly owned subsidiary of Merck’s Healthcare Services and Solutions, to develop a state-of-the-art research program to track, detect and manage antimicrobial-resistant infections at healthcare institutions statewide.
In response to the COVID-19 emergency in New York State, testing under the program has been put on hold by the Wadsworth Center and participating hospitals. We have successfully completed the final milestone for the first year of the contract and will provide more information about the continuation of the project into year two when it is available.
Curetis’ subsidiary Ares Genetics programs are proceeding nicely towards the achievement of the planned corporate partner milestones this summer. Recently, the Austrian government has implemented some of the most restrictive worker stay-at-home requirements to help combat the COVID outbreak. But so far the entire Ares team has been able to continue the project work by smart teleworking solutions.
We anticipate there may be an impact on some programs as laboratory staff might be unable to complete planned experiments on time. Ares Genetics is looking into several alternative scenarios to avoid bottlenecks should this become reality. While the COVID-19 pandemic is creating challenges for our co-development efforts, the new COVID-19 testing and related opportunities presenting themselves to the company could help offset some of the program delays we have highlighted this afternoon.
As mentioned earlier, the business combination with Curetis is expected to be completed as we enter April. The company is well positioned to capitalize on a number of significant new opportunities. Even though we faced challenges with supply chain disruptions, travel restrictions and stay-at-home policies, we are confident that we will be able to both protect our employees and capitalize on the promising opportunities for the new combined company.
In closing, we are pleased with our results for the fourth quarter and full year 2019. We look forward to completing our exciting business combination with Curetis and are encouraged by what will be our integrated business pipeline and growth opportunities for 2020 and beyond. We appreciate your support and your time this afternoon.
I would now like to turn the call back to the operator for questions.
Question-and-Answer Session
Operator
Thank you. [Operator Instructions]. And our first question comes from the line of Yi Chen with H.C. Wainwright.
Yi Chen
Thank you for taking my question. Could you please comment about the specifications of BGI’s test kit for COVID-19 and what’s the volume of shipment thus far, and how the economics will be accounted for in terms of revenue recorded for Curetis? Thank you.
Evan Jones
Thank you, Yi, for your question and interest in the company. I’m going to hand this one over to Oliver Schacht to answer.
Oliver Schacht
Hi. Can you hear me? Is this line open?
Yi Chen
Yes.
Oliver Schacht
Okay. Perfect. Thanks, Yi. Look, the BGI test kit is a standard PCR plate-based assay. It works on an ABI, so it’s a Thermo Fisher platform, ABI 7500; fairly simple reagent kit. It works with any standard RNA extraction protocol. They have specified or recommend the QIAGEN one, but we also know it works with other RNA perhaps. In terms of volume of shipments, it’s really early days as Evan pointed out. Literally last week we received our very first shipment. We’ve gone from let’s say low single digit thousands. Our second order which we received yesterday is the first five digit number of tests. We’re processing orders daily. What I can say is we have shipped several thousand tests in these past 48 hours and quite literally by the hour there is expressions of interest. We just got to work through and figure out how to best and most efficiently and effectively leverage our existing European distribution network. Because as you remember, we at Curetis no longer have a direct sales and end customer presence in the European market. We work through various distributions such as Menarini, Axon Labs, [indiscernible] and others. So that’s our primary goal. That said, we’ve also been – I won’t say inundated, but we’ve also been receiving a lot of inbound calls and requests from hospitals existing Unyvero customers across Germany, France, Benelux where we’re of course also willing to stand by and provide these kits to anybody who has an ABI 7500 system. In terms of the accounting, it’s fairly straightforward. We purchased these kits at an agreed upon transfer price from BGI. They ship to our warehouse here in Germany and we then sell them at a transfer price to our distribution partners. We’ve not guided to any specific pricing, but – and I’d say it’s fair to assume that we’re working off of standard molecular diagnostic industry distribution margins, so somewhere in the call it 20% to 40% range. So there’s definitely a positive gross margin. And again we as of today have no direct end customer channel here. This is all buying in bulk from BGI and then reselling to our distribution network to make sure these tests get straight into the hands of the labs and doctors who need them most urgently across initially Europe, but we’ve also been given the green light from BGI to expand beyond the strict boundaries of the European Union and we have inbound requests as Evan pointed out from a number of countries across the Northern African, Middle Eastern and Asia-Pacific regions of the world as well.
Yi Chen
Thank you. Could you also comment on the additional synergy, if there’s any, between using both the BGI COVID-19 test and the Unyvero test system? Thanks.
Oliver Schacht
Absolutely. If you look at some recent data that’s come out of China, there has been a retrospective study of about 200 patients showing very clearly that in intensive care unit patients you have a prevalence of about 15% to 20% of patients also getting a bacterial pneumonia co-infection. If you look at the mortality cases, almost half, 50%, of all of deaths in the COVID crisis have been attributable to bacterial pneumonia. So while of course it is critical initially to triage patients and diagnose them for coronavirus, as soon as you have them in an intensive care unit and especially ventilated, it’s also critical to make sure you get a rapid diagnosis of all the potential pathogens and that’s really the core of our product portfolio and pipeline at Curetis with the pneumonia and lower respiratory panels in Europe and the U.S. So being able to detect 20 different pathogens and 10 different resistant markers in the U.S., 19 of them have been cleared in Europe, clearly also gives doctors the ability to then select the best antibiotic treatment. Of course, the good news is as opposed to a virus, we do have effective drugs for bacterial pneumonia. We just got to make sure we pick the right ones for these critical care patients.
Yi Chen
Got it. Thank you.
Operator
Thank you. And our next question comes from the line of Ben Haynor with Alliance Global Partners.
Ben Haynor
Good afternoon, gentlemen. Thanks for taking the questions and congrats on reaching a quorum for the vote. Just first off for me, is there any supply chain impact for you guys? And then in the prepared remarks, you mentioned that there is some Unyvero structured programs. If I heard that correctly, what are those? And is there any potential impact to the supply chain on those?
Evan Jones
Go ahead, Oliver.
Oliver Schacht
Sure. I’ll let Evan comment on the supply chain. In Europe, what I can so far, knock on wood, on the Curetis side have not been impacted by any immediate supply chain issues. That of course can change going forward. But we have supply of instruments, we have supply of any components, plastics as well as reagents we need to manufacture our cartridges. So, so far so good. In terms of the structured programs, you’re obviously facing a very interesting conundrum. On the one hand there is significant inbound interest from hospitals to bring in additional Unyvero systems for what I outlined earlier, this parallel testing for bacterial pneumonia. On the other hand, there’s virtually no way physically to send anybody into these hospitals, be it Northern Italy, Austria, the borders are closed across Europe, even inside Germany frankly with a lot of the travel restrictions, it’s literally impossible. So part of the programs we’ve been working on with our distribution partners but also with some of our former direct end clients is sort of virtual video-based Skype and WhatsApp-based video tutorials where we have staff virtually standing by and assisting in the installation, training. And again, it goes to show how easy the Unyvero platform is to use. It doesn’t take necessarily somebody onsite as much as you’d like to be there for the first installation and initial training. That’s just part of the programs. We’ve also offered to our European partner Menarini an increase – we have a pool defined across Europe in all the 11 countries that they serve for us, we have a pool of Unyvero instrument systems which we have agreed to potentially increase in size, make additional units available in a very uncomplicated fashion. And again, we’ve received several additional installation requests in Italy, in Southern Europe in places like Greece. Again, right now the key challenges that Menarini being headquartered in Northern Italy is effectively quarantined as a company, nobody able to go from A to B, so we’re trying to figure out smart ways of working through that. We’ll have some of the – just the hands-on real world challenges that we’re facing, but we’re going to find smart solutions to those.
Ben Haynor
Okay, that’s very helpful. And —
Evan Jones
Sorry. So I was just going to say, Oliver mentioned maybe we’d have some additional comments on the supply chain side of this. We have no immediate impact on the supply chain for our business. But as we look to capitalize on these emerging opportunities in the coronavirus area, you’d be probably aware that even things as simple as getting a nasal swab are very difficult in these times. And when you start to get into more specialty reagents such as the enzymes required for PCR, we think we’re in good shape but we want to sensitize people that our ability to do open field running with new product is also gated by ability to produce the products, and there’s a run on everything you could imagine by all the producers trying to get to market.
Ben Haynor
Okay, that color is very helpful. And —
Evan Jones
Fortunately, that thing – it’s okay, Ben, go ahead.
Ben Haynor
Okay. And then just on the New York State program, I understand that that’s on hold, and no surprise there I guess. But just thinking about it in Q1, will there be or was there any revenue recognized during the quarter for that program?
Evan Jones
Go ahead, Tim.
Tim Dec
Yes, Ben, that’s a good question. If you remember, there was one final milestone in the first year. I’ll let Evan touch on maybe potential out years, but we will be recognizing that last piece of the final milestone in Q1.
Ben Haynor
Okay.
Evan Jones
And back to the programmatic side of this, the full system was up and running including the real-time evaluation of patient records, our AMR pathogen detection showing some very promising data and certainly as you can imagine the New York metro area being at full side of the COVID situation. It’s all hands on deck for that in terms of resources. But one of the things that this has shown is that whole infrastructure and capability may be repurposed in interesting ways to help the state as they go to Phase 2 of this, meaning after we get passed this initial surge. How do we manage COVID-19 patients through the rest of this year and beyond? And as things potentially develop there, we’ll keep you posted.
Ben Haynor
Okay. So that kind of flows into my final question, just thinking about the Lighthouse and the pathogen tracking that you’re already doing on the bacterial side. Is that something that could be expanded and track viruses as well? And if so, what are you guys doing there?
Evan Jones
So I’ll answer this and then hand it over to Oliver if he wants to add anything. Clearly opportunities there, Ben. I think – we just don’t want to get ahead of things and if there’s more to describe, we will bring it forward in the coming month or two.
Oliver Schacht
I would just add, we obviously with the Lighthouse on the OpGen side and the ARESdb in Austria with Ares Genetics, technologically a nucleic acid is a sequence of individual letters whether it’s a DNA or an RNA bacterial virus to the software, to the algorithms per se is neither here nor there, so is it technically doable? The answer is clearly yes. In many ways, a single virus is a much simpler beef [ph] than having dozens of different bacteria that also get resistant. But again, as Evan said, we haven’t made any final decisions at this point how to best approach this not just from a technical development standpoint but also from a collaborative standpoint with New York State or other potential laboratory partners in the U.S. and/or Europe, so we’ll update folks as we move forward.
Ben Haynor
Okay, great, fair enough. Thanks for the taking the questions, gentlemen.
Evan Jones
Thanks, Ben.
Oliver Schacht
Thanks, Ben.
Operator
Thank you. And our next question comes from the line of Maxim Jacobs with Edison Group.
Maxim Jacobs
Hi, guys. Thanks for taking my questions. My first one is just – I understand that the testing landscape for COVID-19 is rather fluid, but I was wondering if you can give us a sense of where the Curetis COVID-19 test stands compared to others that are available in that?
Evan Jones
If you’re talking about the Curetis – are you talking about the BGI test kit or you’re talking about a potential future Unyvero?
Maxim Jacobs
The BGI test kit.
Evan Jones
Got it, okay, understood. Sure. Look, the one thing to realize is as you said it’s a very fluid, very dramatic situation. There’s a substantial universe of opportunities for COVID-19 testing, be it almost home testing for antigens. There’s more and more tests coming out that way all the way through the ultra-high throughput Roche, Covis platforms which honestly those types of platforms are likely going to take the bulk of the sheer volumes when you look at central labs processing thousands, if not tens of thousands of tests in a very short order. Where the BGI test kit fits in is really in that middle segment. The Thermo Fisher ABI 7500 is really a workhorse of the PCR landscape. It’s a well established, widely distributed platform both in Europe and the United States, but in Europe it’s been around for a long time. It’s got a lot of fans, a lot of labs. They’re sort of in the lower to medium volume, but it’s a simple platform; doesn’t require the capital outlay if you go farther out into Eastern Europe or Southeastern Europe, they have fewer and fewer labs that have sort of the latest and greatest Roche, Covis [indiscernible] platforms but they do often have these ABI 7500 workhorse platforms. So we’re playing in this let’s call it medium volume throughput, again, standard 96 well plate. So it’s not onesies and twosies, but it’s also not designed to do 10,000 tests in a single shift. So in that mid range and again that’s the sweet spot and that’s really where the focus is getting those tests in the hands of all of those labs who have the platform readily available. If you look at the PAC insert and the instructions for use and you look at it from a technical standpoint, frankly there’s also no reason to believe these reagent kits and this is true for the BGI kit but also many others that are out on generic PCR equipment would not also work on many other PCR platforms, but of course this being a regulated CE Mark diagnostic, it has been validated on the ABI 7500. Now if folks are looking at this from – getting cute and looking at other PCR platforms, I would not be too surprised if it works equally well on a bunch of other platforms. We know it works on other Thermo Fisher platforms as we have some of those in our own labs. We’re not promoting it actively for those, but it’s certainly something that as things evolve can be looked at in terms of expanding the universe of instruments this can run on.
Maxim Jacobs
Great, that was very helpful. I was just wondering what’s the prospect of developing a test for the U.S. market?
Oliver Schacht
Well, the BGI test kit has been FDA cleared under the Emergency Use Authorization. Given our longstanding strategic partnership with BGI, is this a conversation we’re having with them? Absolutely. Now BGI also has its own direct commercial channels in the U.S., so no decisions have been made there. But the test is, in principle, available in the United States by now. Where they are in terms of inventory, I have visibility on their European operations because their European affiliate is in Germany and in Denmark, so we have good visibility on this. The bulk volume that’s coming through there out of China, I don’t have that visibility on any available test kits in the United States, as in are they physically available there today. But from a regulatory standpoint, as of last week, this has been emergency use authorized by the FDA.
Evan Jones
Max, Evan here. Just wanted to add that on the script earlier, we talked about the potential of adding the coronavirus test to the Unyvero LRT Panel. If that goes forward, that could be moved into the North American market under the Emergency Use Authorization fairly quickly. And then we’re also looking at other opportunities, but one thing we don’t want to do is just duplicate some of the activities that have already been done by others. So I think we’d look to the company to make smart strategic moves here while it capitalizes on its position on the two products that I just mentioned.
Maxim Jacobs
Wonderful. That was extremely helpful. My last question is kind of minor one for Tim. I was just wondering, so after the amendment that was filed last week, how much is left under the ATM right now?
Tim Dec
Sure. There’s a significant amount left, in excess of 11 million.
Maxim Jacobs
Okay, that’s everything. Thank you, guys. That’s all my questions.
Evan Jones
Thank you.
Operator
Thank you. And our next question comes from the line of Bruce Jackson with Benchmark Company.
Bruce Jackson
Hi. Good afternoon and thank you for taking my questions. I wanted to start off with the 510(k) for the Acuitas device. Can you give us a sense of what types of questions the FDA is asking? Are they questions that are easy to address or are these questions that might take some time to work on?
Evan Jones
Bruce, thanks for the question. Even Jones here. I’ll answer that one. First, let me just say that the near-term delays are primarily a function of the State of Maryland having shutdown all nonessentials businesses. And so even though the FDA is capable and is working remotely, that’s causing anticipated understandable near-term delay there. In terms of the remaining questions, without getting into a lot of details I can tell you that they’re the type of questions that are related to product labeling and things like that.
Bruce Jackson
Okay, great. That’s really helpful. And then in terms of the supply of the BGI SARS-2 test, you said you’ve got some visibility. Do you have any type of relationship in place where if you get – if they get supply constrained, you get preferred status and the product can continue to flow to your customers?
Evan Jones
That’s a very good question. I would like to believe so. Is it contractual in writing? No. But I’ve been dealing with Chinese partners for many, many years. We were the first ones they called in January in Europe. We were the first ones they offered the commercial partnership opportunity too? No. Understandably they’re not relying on Curetis alone here in Europe. So we are one of several partners. But we have a very close dialogue with the European representatives and we also have a direct communication channel to corporate headquarters in Shenzhen in China. So far they’ve been very good. They give us heads up on volumes inbound. They proactively ask, what’s your next week’s take? If only I knew. I can tell you literally we’ve been in a mold these last 48 hours where we’ve been short selling products. I’ve sold kits that I knew we were going to get and we did actually receive them this morning, but I sold some of those kits last Friday. So, so far – again, they have made us a preferred partner. We hope that stays that way and we obviously do our utmost to justify that trust in that relationship by getting those kits in the hands of distribution partners and into the market as quickly as possible. What I can see from – again, it’s only been a week the first shipment. The second shipment was 10x the size of the first one. It’s a safe assumption that the next shipment we’re getting is yet again going to be larger. So we’re definitely getting a feel for what’s the weekly volume that we can safely put into our channels, and that number is likely going to be increasing. And so yes, I think we will continue to benefit from this personal but also corporate relationship between Curetis and BGI as things get even crazier and even more hectic here.
Bruce Jackson
Okay, great. Thank you very much.
Operator
Thank you. And I’m showing no further questions at this time. With that, I’ll turn the call back over to CEO, Evan Jones, for closing remarks.
Evan Jones
Thank you everyone for attending today and those of you from the analyst community, thank you for your questions. As you can see, there’s a lot of excitement around the company right now and the work we’re doing and things are moving quickly. We look forward to updating you as we continue to progress things. And thank you very much.
Operator
Ladies and gentlemen, thank you for participating in today’s conference. This does conclude the program. You may now disconnect.
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