{ "docId": "019dd923-622c-750b-8b9a-ad0811d3e80d", "docSlug": "dfcef8f28a20", "documentTitle": "Accelerate Diagnostics (AXDX)", "authorId": "61_White_Diamond_Research", "authorName": "White Diamond Research", "documentKindSlug": "research-note", "documentKindLabel": "Research note", "sourceTypeSlug": "short_seller", "sourceTypeLabel": "Short seller", "presentationDate": "2019-09-16 00:00:00", "orientation": "portrait", "aspectRatio": 0.77272725, "pageNumber": 32, "pageCount": 41, "prevPage": 31, "nextPage": 33, "slideType": "expose_contradiction", "function": "expose_contradiction", "density": "dense", "nDataPoints": 2, "notes": "The text highlights a contradiction between management's narrative of 'better pricing' strategy and the observed low compliance in clinical studies.", "elementsJson": [ "paragraph", "quote_block" ], "metadataConfidence": 0.95, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b9a-ad0811d3e80d/32", "deckHref": "/decks/019dd923-622c-750b-8b9a-ad0811d3e80d", "deckJsonHref": "/decks/019dd923-622c-750b-8b9a-ad0811d3e80d.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b9a-ad0811d3e80d#slide-32", "components": [ { "bbox": null, "kind": "callout", "text": "It does not look to us that physicians were eager to know PhenoTest results, otherwise why would they be not placing positive blood cultures on Pheno systems?", "attrs": null, "subkind": null, "toolName": "Visual emphasis", "toolSlug": "visual-emphasis", "confidence": null, "componentId": "019dd953-78b4-70ad-b3a2-4439a44b5887", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.28, "w": 0.78, "x": 0.11, "y": 0.52 }, "kind": "paragraph", "text": "At the ECCMID, Dr. Wilke and Dr. Bordman reported on initial results of their PHENOMENON study using the Pheno system at Klinikum Barnim in Germany. Per study design, all positive blood cultures should have been sent both to traditional cell culture testing and to the Pheno system. The clinical study was met with a low compliance from ICU physicians and only 50% of positive blood cultures were sent to the Pheno system at week 6 after the start of the study (see the slide below). After additional efforts from Principal Investigators, the clinician's compliance, as shown in the slide by a green bar, eventually reached 80.3% at 6 months, which is still a low number for a controlled environment of a clinical study. It does not look to us that physicians were eager to know PhenoTest results, otherwise why would they be not placing positive blood cultures on Pheno systems?", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "02d0119b-fba0-43d7-a318-b7f17767612e", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.07, "w": 0.78, "x": 0.11, "y": 0.43 }, "kind": "paragraph", "text": "The fact that Pheno system adoption is slowing in the EMEA, may simply indicate the disappointment with Pheno system performance. We observed evidence of low interest of hospitals in PhenoTests during clinical studies in EU.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "05a97d52-1439-451a-b4bb-cf220c68814f", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.16, "w": 0.78, "x": 0.11, "y": 0.24 }, "kind": "paragraph", "text": "As Mehren states above, AXDX didn't close several deals in Germany. Mehren has an excuse for why the deal didn't go through, but the fact remains that they didn't close the deal. We found it intriguing that despite growing concerns in Europe about antibiotic resistance, the Pheno system, which supposedly is designed to quickly and effectively de-escalate antibiotic regiment with its anti-bacterial susceptibility test is such a hard sell in the EU.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "567c73cc-3a04-46b7-8e94-c610a05d2967", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.13, "w": 0.78, "x": 0.11, "y": 0.09 }, "kind": "paragraph", "text": "Our results for the quarter were mixed. Our 55 net new placements were up over 90% year-over-year, but came in below our expectations .... The miss was largely EMEA. And we had turnover in Germany where we had planned on several capital deals and then a large distributor deal that, while we could have closed that sooner, we held out for better pricing.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "fcf52371-e99b-4a20-8ac1-b51ae2d4b762", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "quote", "text": "Our results for the quarter were mixed. Our 55 net new placements were up over 90% year-over-year, but came in below our expectations .... The miss was largely EMEA. And we had turnover in Germany where we had planned on several capital deals and then a large distributor deal that, while we could have closed that sooner, we held out for better pricing. — Mehren", "attrs": null, "subkind": null, "toolName": "Authority citation", "toolSlug": "authority-citation", "confidence": null, "componentId": "019dd953-78b4-70ad-b3a2-4b6b1d5efc54", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.03, "w": 0.3, "x": 0.35, "y": 0.87 }, "kind": "source-note", "text": "Copyright 2019 White Diamond Research research@whitediamondresearch.com", "attrs": null, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "836362a0-3a7c-49b0-99c0-d5a82c83cad5", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [ { "name": "ceo-quote-contradiction", "slug": null, "matchId": "44d7f3a3-dfd0-4256-a210-956476163b9b", "evidence": "Contrasts management's stated reason for deal failure with observed clinical study data.", "confidence": 0.9 } ], "arcBeats": [ { "to": 41, "from": 30, "beatId": "ca57db9c-677e-4ef8-919c-92b1690ee48e", "arcName": "Problem-Agitate-Solution", "arcSlug": "problem-agitate-solution", "beatName": "Solution (Provide relief)", "beatSlug": "problem-agitate-solution-solution-provide-relief", "evidence": "The document implies that the solution is to be cautious of the system's limitations and avoid investment in AXDX, citing a potential decline in AXDX shares.", "position": 2, "confidence": 0.8, "parentBeatName": "Resolution", "parentBeatSlug": "resolution" } ], "loops": [ { "to": 35, "from": 31, "name": "Cost Of Inaction", "slug": "27-cost-of-inaction", "bestFor": "Urgent budget requests, compliance, risk mitigation", "matchId": "c590c16d-0680-4cc5-a734-8a884e9eff8b", "evidence": "The document implies that the cost of inaction is the potential decline in AXDX shares and the unjustifiable premium vs its close comparator, T2 Biosystems.", "position": 1, "objective": "What is the cost of inaction regarding AXDX's Pheno system?", "structure": "The Status Quo -> The Hidden Costs Accumulating -> The Future State of Inaction -> The Tipping Point", "confidence": 0.7, "description": "Quantify what happens if the audience does nothing" } ], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }