Dunedin-based cancer diagnostics company Pacific Edge has reported a full-year net loss of 35.8 million dollars and a revenue slump to 11.5 million dollars, but chief executive Peter Meintjes says the business is now in sight of a return to profitability following a major US Medicare breakthrough.
The NZX-listed firm released its results for the 12 months to 31 March 2026 on Monday, confirming the worst trading year in its recent history. Operating revenue fell from 21.8 million dollars the previous year to 11.5 million dollars, total revenue dropped from 24.6 million to 13.6 million, and the bottom-line loss widened from 29.9 million to 35.8 million dollars. Net assets shrank from 26.0 million to 10.7 million dollars over the same period.
Laboratory throughput across the group dropped 16.3 percent to 24,190 tests for the year, with commercial test volumes falling 23.8 percent to 18,783 tests. The collapse traces back to January 2025, when the United States Centers for Medicare and Medicaid Services pulled reimbursement for the company’s flagship Cxbladder test, a urine-based diagnostic used to detect or rule out bladder cancer in patients presenting with blood in the urine. Medicare had previously underpinned roughly 60 percent of Pacific Edge’s income.
The picture turned on 15 May, when Medicare administrator Novitas published a draft Local Coverage Determination proposing coverage for urine biomarker testing in patients with microhaematuria, with specific positive language for Cxbladder Triage and Cxbladder Triage Plus. The draft covers roughly 20 million Americans aged 65 and over within the Novitas jurisdiction and is expected to be finalised before the end of calendar 2026.
Pacific Edge is not waiting for the final ruling. From 15 May, the company began submitting claims for intermediate-risk patients to Novitas under the draft policy, with Cxbladder Triage Plus priced at 1,328 US dollars a test. Meintjes told RNZ the Triage product carries better economics than the older Detect line that the company had historically pushed in the US market, saying it delivered “more revenue per test, more margin per test, higher margin percentage per test”.
Costs have also been pulled back hard. Operating expenses fell 9.5 percent on the previous year, and average monthly cash burn in the second half eased to 2.4 million dollars from 3.3 million in the first half. The first-half loss of 19.1 million dollars compares with 16.7 million in the second half, suggesting the bleeding has slowed even as revenue stayed under pressure.
To keep the lights on while waiting for Medicare to flick the switch on full reimbursement, Pacific Edge tapped the market in mid-May, raising 25.4 million dollars from institutional investors at 17 cents a share. A retail share purchase plan seeking up to a further 6 million dollars is due to close on Thursday 28 May. The placement nearly doubled the company’s cash reserves, which sat at just 7.8 million dollars at balance date.
In the company’s FY26 results commentary, Meintjes described the year as strategically significant, with the draft Medicare policy change the standout achievement after almost two years of regulatory limbo. He said the focus has now shifted from policy advocacy to commercial execution, including integration of Cxbladder ordering into US hospital electronic medical records to lock in first-mover advantage before competing biomarker tests reach the market.
Investors have noticed. Pacific Edge shares were among the strongest performers on the NZX through May after the draft determination was published, although the stock remains well below the levels it traded at before Medicare coverage was withdrawn in early 2025. The capital raise priced at 17 cents underlines how much value has been destroyed, with the company still trading at a fraction of its 2021 peak.
The Pacific Edge story is one of the more closely watched on the local market because it sits at the intersection of New Zealand biotech ambition and the realities of US healthcare reimbursement. Cxbladder is developed in Dunedin and processed in a CLIA-accredited laboratory in Hershey, Pennsylvania, but its commercial fortunes rise and fall with decisions made inside Medicare contractors thousands of kilometres from Otago. The past 16 months have been a brutal demonstration of that dependency.
What happens next is largely procedural. Novitas is taking submissions on the draft determination, with a final ruling expected to convert the present claim-by-claim reimbursement into automatic coverage. If that happens on the timeline the company is signalling, Pacific Edge will enter 2027 with a Medicare-funded product line, a refreshed balance sheet, and a US sales effort that is being rebuilt around the Triage products rather than Detect. If it does not, the company will have to test the patience of investors who have just put in another 25 million dollars.
For now, Meintjes is calling it a turning point. The market will know within months whether he is right.
What do you think, is the worst over for Pacific Edge, or has the company simply bought itself another year of runway? Have your say in the comments below.
This article was written by AI, briefed to report the facts, hopefully without some of the bias people bring to the job 🙂
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