bioAffinity Technologies Plans $4 Million Cost Cut to Boost CyPath® Lung Sales
bioAffinity Technologies, Inc. (Nasdaq: BIAF; BIAFW), a biotechnology company focused on noninvasive testing for early-stage lung cancer and other lung diseases, has outlined its latest strategic actions aimed at improving financial performance and driving the growth of CyPath® Lung, its noninvasive diagnostic test for early-stage lung cancer. The company has announced a series of measures expected to deliver approximately $4 million in annual cost savings at its subsidiary, Precision Pathology Laboratory Services (PPLS), while reinvesting those savings into the commercial expansion of CyPath® Lung, particularly in high-potential national markets.
Following the acquisition of PPLS, bioAffinity Technologies embarked on a comprehensive review to optimize operations and accelerate CyPath® Lung’s market penetration. This review has led to the decision to implement operational changes at PPLS that align with bioAffinity’s long-term commercial strategy. The company remains committed to providing PPLS clients with the high-quality anatomical pathology services that have been the cornerstone of the laboratory’s reputation for over 25 years. These changes are designed to enhance bioAffinity’s commercial strategy, fast-tracking the market expansion of CyPath® Lung, and increasing sales while maintaining excellent customer service for PPLS’s existing clients.
Maria Zannes, President and CEO of bioAffinity Technologies, shared the company’s vision: “We believe that the changes at PPLS will not only support but enhance bioAffinity’s ability to expand the reach and sales of CyPath® Lung. Our focus is on achieving key milestones by 2025, including initiating enrollment in the FDA pivotal trial for CyPath® Lung, and continuing to develop other noninvasive diagnostic tests, such as those for COPD and asthma. We are committed to achieving our goals by leveraging the innovation and expertise of both bioAffinity and PPLS employees.”
The strategic cost-saving measures are expected to reduce operational expenses and improve profitability at PPLS. Specifically, bioAffinity Technologies aims to achieve the bulk of the $4 million in cost savings through:
- Labor Cost Reductions: A workforce reduction of approximately 38% at PPLS will contribute to the overall savings.
- Operational Efficiency Enhancements: These include reducing direct costs for purchased services and supplies, which will streamline operations.
- Focusing on High-Margin Services: By discontinuing certain pathology services with suboptimal profit margins, bioAffinity will prioritize services that offer higher margins, such as those related to CyPath® Lung.
While these measures may result in a short-term reduction in revenue, they are expected to enhance PPLS’s long-term profitability by concentrating resources on high-value service lines, particularly CyPath® Lung. Michael Edwards, Chief Financial Officer at bioAffinity, emphasized that the focus on high-margin services would improve the company’s overall financial performance.
“Although these actions are expected to decrease revenue in the short term, they will also help improve the profitability of PPLS by focusing on CyPath® Lung and other high-value services,” said Edwards. “We are confident that this strategic shift will enhance our ability to serve the growing market for noninvasive lung cancer detection.”
CyPath® Lung remains the centerpiece of bioAffinity’s commercial strategy, which continues to see strong year-over-year sales growth. The company is particularly optimistic about the expanding adoption of CyPath® Lung by physicians, especially in civilian and military healthcare systems. With the test now available through the Federal Supply Schedule, bioAffinity plans to launch a focused government marketing program to introduce CyPath® Lung to Veterans Administration (VA) and Department of Defense (DoD) medical centers in the coming quarter.
Zannes commented on this opportunity, saying, “Our strategic adjustments are aimed at enhancing our readiness to serve both civilian and military healthcare systems for noninvasive lung cancer detection. We are seeing an increasing number of physicians incorporating CyPath® Lung into their protocols for patients at high risk for lung cancer, and we are excited to introduce this breakthrough technology to the VA and DoD medical centers.”
About CyPath® Lung
CyPath® Lung is a groundbreaking noninvasive diagnostic test developed by bioAffinity Technologies that utilizes advanced flow cytometry and artificial intelligence (AI) to detect lung cancer. The test works by identifying specific cell populations in patient sputum that may indicate malignancy. The system incorporates a fluorescent porphyrin compound that preferentially binds to cancer and cancer-related cells. CyPath® Lung is designed to detect small lung nodules, less than 20 millimeters in size, which are typically difficult to evaluate using traditional diagnostic methods.
Clinical studies have demonstrated that CyPath® Lung boasts a high degree of accuracy, with 92% sensitivity, 87% specificity, and 88% accuracy in detecting lung cancer in high-risk patients. Early-stage lung cancer detection can significantly improve treatment outcomes and increase patient survival rates. With its noninvasive nature, CyPath® Lung offers a safer, more accessible method of screening for lung cancer, presenting a compelling alternative to more invasive procedures like biopsies.
By combining advanced technology and a commitment to improving patient outcomes, CyPath® Lung is positioned to become a key tool in the fight against lung cancer, offering a promising solution for both doctors and patients alike.
