Exclusive: T2 Biosystems CEO Says Euro Approval On Sepsis Bacteria Test A 'Big Milestone' - T2 Biosystems (NASDAQ:TTOO)

The emergence of superbugs and drug-resistant bacteria have many talking about antibiotic overprescribing, a practice common in the desperate treatment of sepsis.

With a U.S. incidence rate of more than 1 million and an estimated mortality rate between 28 and 50 percent, sepsis is a formidable foe with a range of possible causes, requiring physicians to initiate treatment plans on guesswork as they await the slow results of blood diagnostics.

“If you guess right, you can save their life, so it’s the right thing to do,” T2 Biosystems Inc TTOO CEO John McDonough said.

But a wrong guess can lead to death or, at the very least, strengthen bacterial resistance to drugs.

To address the problem, T2 blends nanotechnology and advanced magnetic resonance methods to hasten detection and inform treatment of sepsis. It currently markets T2Candida for fungal infections, and last week, it secured approval to distribute T2Bacteria Panel in Europe.

“For the first time, we’re able to identify the specific source of that bacteria or fungal infection directly from the blood without a blood culture, and our detection time ranges between three and five hours,” McDonough said.

What's Up Next

McDonough said trials for the U.S. Food and Drug Administration are 92-percent complete, and he’s hopeful to secure clearance before the end of 2017 to initiate a U.S. rollout in early 2018.

Primarily targeting midsize-to-large U.S. hospitals, T2 aims to support in-patients with hospital-acquired infections and emergency drop-in patients presenting with signs of sepsis.

So far, it’s reported positive feedback from early clients.

Detroit’s Henry Ford Health System allegedly demonstrated annual savings of more than $2 million since its adoption of T2 products, which eliminated speculative prescription methods, prevented the expense of ultimately ineffective drugs and limited patient time in the hospital.

“We can enable up to 95 percent of patients to get on the right drug the first time in the first six hours, and it’s a real game changer,” McDonough said.

T2’s Rough Financial Ride

Despite management optimism, T2’s stock has trended down since early 2015, and it hit an all-time low in mid-July. It’s now down 48 percent year to date.

However, McDonough said he is comfortable with the firm’s cash position ━ $50 million as of the end of June ━ and does not need to raise capital.

“I think the share price, we’re not crazy about where that price is,” he said. “But we also know that we had some big early-venture investors that even go back to 2006 and 2007 who may be selling, and of course if you have that kind of selling of such a thinly traded stock like T2, it will put enormous pressure on the price. We’re hopeful and believe that the current price is not reflective of the performance of the company but perhaps other market dynamics that are in play.”

Nick Donato contributed reporting.

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