Aspira Women's Health Inc. (NASDAQ:AWH) is a leading diagnostics company dedicated to the discovery, development, and commercialization of noninvasive, AI-powered tests to aid in the diagnosis of gynecologic diseases, with a focus on ovarian cancer and endometriosis. The company's comprehensive product portfolio and robust pipeline position it as a trailblazer in the women's health diagnostics space.

Business Overview

Aspira's core business revolves around its OvaSuite product line, which includes the Ova1Plus workflow and the OvaWatch test. The Ova1Plus workflow utilizes Ova1 as the primary test and Overa as a reflex for Ova1 intermediate range results. Ova1 is a qualitative serum test intended to further assess the likelihood of malignancy in women with an ovarian adnexal mass when the physician's independent clinical and radiological evaluation does not indicate malignancy. Overa is a second-generation biomarker test designed to maintain Ova1's high sensitivity while improving specificity.

The company's OvaWatch test is a laboratory developed test (LDT) intended to assist in the initial clinical assessment of malignancy risk in all women thought to have an indeterminate or benign adnexal mass. In the first quarter of 2024, OvaWatch test volume grew by an impressive 114% year-over-year, representing approximately 18% of the company's total OvaSuite test volume of 5,829.

Aspira's product portfolio also includes the development of OvaMDx, a multi-marker test that combines serum proteins, clinical data, and miRNA for assessing the risk of ovarian cancer in women with an adnexal mass. Additionally, the company is developing EndoCheck, the first protein biomarker test designed to identify ovarian endometriomas, and EndoMDx, a multi-marker test that combines serum proteins, clinical data, and miRNA for the identification of endometriosis.

Financials

For the full year 2023, Aspira reported annual revenue of $9,154,000, a decrease from the previous year's revenue of $9,567,000. The company's net loss for the year was $16,690,000, compared to a net loss of $17,234,000 in the prior year. Annual operating cash flow was -$15,894,000, and annual free cash flow was -$15,918,000.

In the first quarter of 2024, Aspira's product revenue was $2,153,000, a slight decrease from $2,315,000 in the same period of the prior year. The decrease was primarily due to a 4.4% decline in OvaSuite test volume, which was partially offset by a 114% increase in OvaWatch test volume. The company's gross profit margin for the quarter improved to 56.4%, compared to 51.2% in the first quarter of 2023.

Operating expenses decreased significantly in the first quarter of 2024, with research and development expenses down 28%, sales and marketing expenses down 27%, and general and administrative expenses down 13%, compared to the same period in the prior year. This disciplined spending helped to reduce the company's cash used in operating activities by 23% to $4.4 million in the first quarter of 2024, compared to $5.7 million in the same period of 2023.

Liquidity

As of March 31, 2024, Aspira had $3.4 million in cash and cash equivalents (excluding restricted cash of $260,000) and $5.3 million in current liabilities. The company has an existing equity line of credit with Lincoln Park Capital, of which approximately $2.8 million remains available. Additionally, Aspira is pursuing various dilutive and non-dilutive sources of funding, including research grants, to support its operations and product development initiatives.

Recent Developments

Operational Highlights

A key operational highlight for Aspira in the first quarter of 2024 was the successful launch of the longitudinal monitoring feature for its OvaWatch test. This new capability allows physicians to order the OvaWatch test at prescribed intervals to monitor the risk of ovarian cancer in women with indeterminate or benign adnexal masses. The company believes this feature has the potential to significantly expand the addressable market for OvaWatch, as it can now be used for repeat testing on the more than 1.2 million women in the United States diagnosed with an adnexal mass each year.

The launch of the longitudinal monitoring feature for OvaWatch was supported by the publication of two peer-reviewed manuscripts in May 2024. The first manuscript, published in Frontiers of Medicine, demonstrated that the use of OvaWatch to stratify risk in patients with an adnexal mass might help to reduce surgical backlogs and unnecessary surgical referrals. The second manuscript, published in Gynecologic Oncology, showed that OvaWatch could be an effective tool for the monitoring of ovarian cancer risk over time in women with indeterminate or low-risk adnexal masses.

Aspira also made significant progress in the development of its pipeline products, OvaMDx and EndoMDx. For OvaMDx, the company has completed assay analytical feasibility on an FDA-approved PCR system and is nearing completion of the initial test design. The company believes the performance of the miRNAs licensed from Dana Farber Cancer Institute will lead to the development of a commercial application that can improve sensitivity for early-stage ovarian cancer and specificity for histological subtypes.

Regarding EndoMDx, Aspira will begin establishing analytical feasibility and down-selecting miRNA and protein candidates as part of the ongoing test design. The company expects to complete the assay and algorithm design input and begin the verification and validation procedures by the end of 2024, leveraging its experience in developing OvaMDx.

Regulatory Landscape

In May 2024, the FDA finalized its rule to regulate laboratory developed tests (LDTs), which include Aspira's current commercially available tests. The final rule included a clause to grandfather in tests already in the market as of May 6, 2024, which applies to Aspira's current tests. The company is still assessing the impact of the final rule on the regulatory strategy for products in its pipeline, but it does not currently anticipate the new regulation to cause significant extensions of its prior development or launch timelines.

Competitive Landscape and Market Opportunity

Aspira operates in a competitive women's health diagnostics market, with players such as Myriad Genetics, Vermillion, and Biodesix offering similar tests for the assessment of ovarian cancer risk. However, the company's unique position as the only provider of a blood-based test for the accurate assessment of malignancy risk in all patients with an adnexal mass, as well as its pipeline of innovative tests for endometriosis, gives it a distinct advantage.

The company estimates the addressable market for OvaWatch, including the new longitudinal monitoring feature, to be two to three times larger than the single-use test, as it can now be applied to the more than 1.2 million women in the United States diagnosed with an adnexal mass each year. Additionally, the endometriosis market represents a significant opportunity, as the condition affects more than 6.5 million women in the United States, according to the U.S. Department of Health and Human Services.

Outlook

Aspira remains focused on its mission to improve health outcomes for millions of women while positioning the company for long-term success. The launch of the longitudinal monitoring feature for OvaWatch, the return to volume growth, and the strong clinical data supporting the test's utility are all positive indicators for the company's future.

The company's pipeline of innovative diagnostics, including OvaMDx and EndoMDx, further solidifies its position as a leader in women's health diagnostics. Aspira's disciplined approach to spending and its pursuit of alternative funding sources, such as research grants, demonstrate its commitment to responsible financial management and the advancement of its product development initiatives.

Conclusion

Despite the ongoing challenges in the market, Aspira has remained steadfast in its execution and continues to deliver on its promises to patients, physicians, and shareholders. With a strong product portfolio, a robust pipeline, and a dedicated team, the company is well-positioned to capitalize on the growing demand for innovative, non-invasive diagnostic solutions in the women's health space.