SG biotech firm Mirxes reports 70% revenue drop in FY 2022, prospectus reveals (Update)

Mirxes co-founder and CEO Lihan Zhou / Photo credit: Mirxes

Mirxes, a Singapore-headquartered biotech firm, generated US$17.8 million in revenue in the financial year ended December 31, 2022, according to the prospectus filed for its upcoming Hong Kong IPO.

This marks a 70.7% reduction compared to FY 2021.

Its gross profit margin dropped “primarily due to lower margins of our infectious diseases business segment,” the company wrote in its prospectus. In this segment, Mirxes offers Covid-19 testing kits, a swab collection system, as well as RNA extraction kits.

According to Mirxes, sales of its Covid-19 diagnostic kit “substantially declined in 2022 and we expect it will continue to decrease significantly.” The business unit contributed “a meaningful portion” of its revenues last year, as well as 2021.

However, a spokesperson for Mirxes told Tech in Asia that Covid-related products are not part of Mirxes’ core business, and that the firm’s early detection unit has been on a steady climb revenue-wise.

The Singapore biotech company’s cost of sales for 2022 stood at US$8.4 million, shrinking 54.3% compared to the prior year. This places Mirxes’ gross profit at US$9.3 million, down from US$42.2 million the year before.

The filing also shows that Mirxes increased its R&D spending from US$7.9 million in 2021 to US$18.5 million in 2022.

The spokesperson said that the company’s increased investments in tech last year “form part of our plans to build for the future.”

Mirxes develops test kits for the early detection of cancer and other diseases. It was spun out of Singapore’s Agency of Science, Technology, and Research (A*STAR) in 2014 to commercialize its products and make them more accessible.

Last week, Mirxes announced its plan to list on Hong Kong’s stock exchange after a US$50 million fundraise that took the firm’s valuation to around US$600 million.

“We hope to tap into Hong Kong’s specialist healthcare and biotech investor base, and by extension, China as well, which could both support and benefit from our growth,” the person said, keeping mum on the company’s valuation at the time of listing.

If the plan goes through, Mirxes would become the first company outside China and Hong Kong to be granted a biotech IPO on the exchange.

Moving forward, the company plans to further increase R&D capabilities, improve its speed to market, and develop a “super app” for precision multi-omics testing in Southeast Asia, the prospectus said.