Yesterday I wrote about how the medtech and healthcare sector is seeing amazing growth. It’s one of my favorite sectors to look for promising startups in. But my love of this sector is nothing new. And today I want to give you an update on one of my favorite medtech startups. I originally recommended 20/20 GeneSystems in December 2017 — more than three years ago. The company has used that time to improve its core OneTest product (which measures tumor antigens), expand into other testing services and substantially increase sales.
To refresh your memory, 20/20 helps identify cancer risk early on. It does this by using tumor antigen markers and then adding its proprietary machine-learning algorithms that boosts cancer detection by up to 30%.
In its fourth quarter 2020 report, the company reported impressive topline growth. (Quick note: Topline is revenue growth and bottomline is profit growth.) It generated more than $2.2 million last year, thanks to several opportunistic COVID-related initiatives. That’s a sevenfold increase over the $288,000 it made the year before.
Given its own lab experience and capabilities measuring antigens, 20/20 understood that it would play a role in helping government agencies roll out COVID-19 tests that had received emergency approval from the FDA. It was a win-win opportunity. While being careful to follow all the rules, the company could help the country manage the pandemic and at the same time make some extra money. 20/20 GeneSystems launched three major COVID-related initiatives last year…
- Distribution of validated COVID-19 tests imported from China.
- A contractual arrangement with a local Maryland county (where 20/20 is headquartered) to provide up to 2,000 coronavirus tests a day using a newly installed suite of testing equipment in its CLIA lab.
- Acquisition of a new FDA authorized blood test made by Roche Diagnostics that quantitatively measures antibodies against the coronavirus’ spike protein. Distribution of these tests should help individuals monitor changes in their antibody levels over time. 20/20 believes it’s the first company to market a fingerstick collection kit for use with this particular quantitative antibody test.
It was an unusual year for the company. At the outset of 2020, how could founder and CEO Jon Cohen have any inkling that 80% of the company’s revenues would come from coronavirus-related testing? Like everybody else, he had to adjust on the fly. For some companies, that meant playing defense. But for Jon, it was a chance to go on the offensive and extend the company’s services to take advantage of the unusual circumstances. He did a good job of monetizing the opportunities that best aligned with the company’s capabilities. But he also didn’t ignore his traditional products. Their sales revenue also grew 25% — despite an overall decline in routine cancer screenings nationwide last year. And 20/20’s OneTest revenues increased 30% from the previous year.
This year may prove to have more in common with 2020 than 2019. The country is still in the throes of a worsening pandemic. If anything, 20/20’s distribution of rapid antibody and antigen tests should encounter increasing demand in the coming months and likely for the entire remainder of the year.
That should mean continued robust revenue generation and steady progress for 20/20’s pre-COVID core products. I remain very excited about 20/20 GeneSystems’ future prospects.