T2 Biosystems: Innovator in Rapid Diagnostics with FDA and CE-Certified Products and Over $10M in Revenue

New Technology Add-on Payment (NTAP) is a program launched by the U.S. Centers for Medicare & Medicaid Services (CMS) in 2001 to provide additional payments for new technologies. Under this program, hospitals receive supplemental reimbursement when they use an NTAP-qualified technology to provide medical services to patients.

This was introduced by CMS to support the development of new technologies with clinical value. To qualify for NTAP, three screening criteria must be met:First, the technology must be novel; second, existing Medicare coverage does not adequately cover the technology; third, the technology must demonstrate to CMS a distinct clinical advantage over other available technologies.

In 2019, the T2Bacteria Panel, an in vitro diagnostic test, was approved by CMS for inclusion in the New Technology Add-on Payment (NTAP) program. In September 2020, T2 Biosystems, the developer of the T2Bacteria Panel, announced that CMS would continue to provide NTAP coverage for the T2Bacteria Panel in 2021.

Through this extension, U.S. hospitals will continue to receive a new technology add-on payment of $97.50, which represents 65% of the average price of the T2Bacteria Panel, when treating Medicare inpatients with sepsis.

John Sperzel, President and Chief Executive Officer of T2 Biosystems, stated, “We are pleased that CMS has decided to extend the NTAP for the T2Bacteria Panel, as it allows healthcare institutions to continue receiving favorable reimbursement while utilizing this life-saving technology.”

T2 Biosystems is a medical device company based in Massachusetts, USA, specializing in the development of innovative in vitro diagnostic products.

The T2Bacteria Panel’s access to NTAP is attributable toIt can directly identify bacteria from whole blood and complete species identification within hours, without the need to wait for blood culture results.

This highly efficient detection is built on a technology called T2 Magnetic Resonance (T2MR), a diagnostic testing method that leverages micro-NMR technology. The "T2" refers to what the technology measures—the response of water molecules in a magnetic field—which is also the origin of the name T2 Biosystems.

T2MR has a wide range of applications.Studies published in more than 100 peer-reviewed journals have shown that T2MR can directly detect targets in whole blood, plasma, serum, saliva, sputum, and urine.

Moreover, T2MR is more time- and labor-efficient compared to traditional methods such as blood culture.T2MR is a detection technology that can rapidly identify molecular targets in patient samples without the need to purify or extract target molecules from the samples. Furthermore, T2MR diagnostic signals are not affected or disrupted by sample background, even in the presence of the highly complex background found in blood. Based on this, T2MR technology reduces the intensive operational steps required in traditional assays, thereby saving time.

On the other hand, T2MR exhibits exceptionally high detection sensitivity, thereby ensuring diagnostic accuracy.The T2Dx instrument, powered by T2MR, can detect organisms at levels as low as 1 CFU/mL, whereas traditional blood cultures typically require cell counts ranging from 10,000 to 1,000,000 CFUs/mL. This represents a more than thousand-fold increase in the number of cells required compared to T2MR, which also meansT2MR offers a thousands-fold increase in sensitivity, making it the only FDA- and CE-cleared technology capable of detecting low levels of pathogens in whole blood.

T2 Biosystems, driven by its T2MR technology, has developed products such as the T2Dx Instrument, T2Candida Panel, T2Bacteria Panel, T2Cauris Panel, and T2Resistance Panel. Its product pipeline is shown in the figure below.

Source: T2 Biosystems Official Website

T2 Biosystems helps clinicians treat patients rapidly, improve patient care, and reduce care costs through the development and commercialization of innovative medical diagnostic products. Specifically, it relies on the T2Dx instrument from T2 Biosystems to run various panels of assays.

T2Dx is a fully automated, portable, benchtop diagnostic system powered by T2MR technology, capable of clinical multiplexing. It has received FDA clearance and CE marking, and is currently serving nearly 200 hospitals worldwide. The instrument offers the following advantages:

First, rapid results.that is, no sample pre-preparation is required, and test results can be obtained within 3–5 hours;

Second, it is easy to operate.The T2Dx is a fully automated system that requires only placing the sample tubes and reagent tray on the detection plate, then inserting it into the instrument.

Third, random access.T2Dx features seven independent access panels that can be loaded at any time without the need for batch processing.

Fourth, one instrument for multiple tests.T2Dx can run multiple assay panels, enabling clinical multiplexing.

Source: T2 Biosystems Official Website

In addition to the T2Dx instrument, T2 Biosystems’ website indicates that there are currently two commercialized products—the T2Bacteria Panel and the T2Candida Panel—as well as four products in development and two in the planning stage.

Among these, the T2Bacteria Panel available on the market can directly identify sepsis-causing bacteria from whole blood and deliver results within 3 to 5 hours, with diagnostic accuracy equivalent to that obtained from three sets of blood cultures.It can identify 50% of bacterial bloodstream infections; 70% of blood culture isolates in the emergency department; and 92% of lethal ESKAPE pathogens.

In the pivotal T2Bacteria clinical trial involving 1,427 patients across 11 centers in the United States, researchers demonstrated that T2Bacteria detected three times more infections than paired blood culture results; both positive and negative results were obtained more than two days faster than with blood cultures. This provides an opportunity to reduce treatment complexity and shorten the time to targeted therapy.

By incorporating it as part of the sepsis bundle therapy, clinicians can ensure that more patients receive appropriate treatment more rapidly, thereby optimizing empirical treatment regimens, halting the progression of sepsis, and improving the chances of patient survival and recovery.

Source: T2 Biosystems Official Website

John Sperzel, President and Chief Executive Officer of T2 Biosystems, stated, “According to data from the U.S. Centers for Disease Control and Prevention, at least 1.7 million adults in the United States develop sepsis annually, resulting in nearly 270,000 deaths. Our T2Bacteria Panel facilitates rapid diagnosis and treatment, enabling us to help reduce patient numbers and improve patient outcomes by targeting appropriate antibiotic therapy.”

The T2Candida Panel can also detect fungal pathogens directly from blood, accelerating targeted treatment and reducing treatment costs.Key clinical trials have demonstrated that T2Candida delivers results within 3 to 5 hours. In contrast, all other FDA-approved diagnostic methods for Candida require 2 to 8 days for blood culture, and blood cultures fail to detect up to half of infections.

Its primary clinical use is for patients with any of the following conditions: admission to the ICU, febrile neutropenia, septic shock, or high risk of invasive candidiasis in the ICU setting.

The overall mortality rate for Candida infections is 40%, but it can be reduced to 11% if patients receive targeted therapy within 12 hours. Obtaining appropriate treatment more rapidly can shorten hospital stays and total ICU length of stay, saving $30,000 per patient.

Other products, including the T2Resistance Panel, T2Lyme Panel, and T2Cauris Panel, are currently for research use only.

T2Lyme Test PanelBacteria causing Lyme disease can be directly identified from patients' blood. For patients infected with the bacteria that cause Lyme disease, early diagnosis and appropriate treatment can reduce complications and significant associated costs.

T2Resistance Test PanelIt is a detection panel developed by T2 Biosystems in collaboration with Allergan and CARB-X, capable of detecting a broader range of bacterial species and resistance markers. T2Resistance can detect both Gram-negative and Gram-positive bacteria and was granted "Breakthrough Device" designation by the FDA in 2019.

Source: T2 Biosystems Official Website

T2Cauris Test PanelDetects the superfungus Candida auris in patient skin, blood samples, and hospital environmental samples. Unlike most other Candida species, this fungus is characterized by multidrug resistance, high mortality rates, and difficulty in identification.

In addition to these products, T2 Biosystems’ pipeline includes two more candidates under development.

T2 Biosystems’ products primarily target areas with unmet medical needs, such as sepsis, toxemia, and Lyme disease, aiming to provide patients with rapid and accurate diagnosis and treatment, while contributing to improved patient care and cost reduction.

In May 2021, T2 Biosystems announced amendments to the terms of its existing contract with the U.S. Biomedical Advanced Research and Development Authority (BARDA), advancing the timeline for future product deliveries. The multi-year agreement between T2 Biosystems and BARDA is reportedly valued at up to $69 million.

In addition to its collaboration with BARDA, T2 Biosystems was incubated with support from Flagship in its early stages, and Flagship also participated in the company’s early financing rounds.In fact, since its establishment in 2006, T2 Biosystems has received substantial capital support. After completing five rounds of financing, it successfully went public in 2014.Its partial financing details are as follows:

Source: Crunchbase

More than five years after its IPO, T2 Biosystems has maintained sound operational performance. Its 2020 financial report showed that the company generated $18.1 million in revenue for the year, including $11.7 million from product sales, representing year-over-year increases of 118% and 119%, respectively.

“In 2020, we made significant progress across our business, including demand for our products,” said John Sperzel, President and Chief Executive Officer of T2 Biosystems. “Entering 2021, we will continue to focus on three corporate priorities—accelerating commercialization, improving operations, and advancing our product pipeline. We believe this positions the company for continued growth and long-term success.”

The Company expects its total revenue for the full year 2021 to range between $24 million and $26 million, including product revenue of $16 million to $18 million and research and contribution revenue of approximately $8 million; it also anticipates signing at least 30 contracts for T2Dx instruments in 2021.

Now that half of 2021 has passed, T2 Biosystems has released its financial report for the first quarter of 2021. The report shows that revenue in the first quarter was $7 million, a 173% increase from the same period last year; four T2Dx instruments were sold.

John Sperzel stated, “We are very satisfied with our progress in the first quarter, including a 173% increase in total revenue, a 345% increase in product revenue, and an 85% increase in sepsis testing revenue. We have rebuilt a clinically focused U.S. sales team to drive greater adoption of our new sepsis products, and we are strengthening our medical and clinical affairs teams to support our customers.”