Biomerica Inc. has gotten a boost from increased global demand for diagnostic testing.
Irvine-based Biomerica, which makes diagnostic-testing products, ranks No. 59 on the list of fastest-growing Orange County-based public companies (see list, page 40), down from No. 61 a year ago.
Its tests include EPO Elisa—which is used to track anemia—and EZ Detect for colon maladies.
It also makes tests for irritable bowel syndrome and gastrointestinal diseases, food intolerance, and bone and anemia conditions.
The company posted 20% revenue growth during a two-year span through June 30. It saw $6.1 million in revenue for 12 months through June and $5.1 million during a similar period ending in June 2010.
Biomerica’s growth comes primarily from its established markets, said Chief Executive Zackary Irani.
“It’s really not any new tests or any new markets at this point,” Irani said. “This is just organic growth in the markets that we are operating in.”
The company is seeing more use of its tests for diabetes and irritable bowel syndrome, a disorder with symptoms that include cramping, diarrhea, abdominal pain and other signs.
“As diabetes grows [and] as people discover the benefit of using our product for IBS, our market is just growing organically,” Irani said.
IBS represents a particularly growing market. Millions of Americans have various symptoms of the syndrome, and Irani said the annual direct medical cost of the disease is about $10.5 billion.
“It’s a very large market,” he said. “It’s something that doesn’t really have any clear therapy for.”
Most of Biomerica’s sales are in Europe and Asia, including China, and the company is interested in expanding into some more Southeast Asian and South American markets.
Irani said the company has some U.S. sales, primarily to drugstores and some larger clinical laboratories.
Irani said that the company is considering submitting some of its IBS and diabetes tests to the Food and Drug Administration to sell domestically.
• Headquarters: Irvine
• Business: Medical diagnostic products
• Founded: 1971
• Ticker symbol: BMRA (OTC)
• Fiscal 2012 revenue: $6.1 million through May
• Recent earnings: $291,640 for fiscal first quarter ended Aug. 31
• Market value: About $5.8 million
• Notable: Primarily focuses on products for diabetes, gastrointestinal disease and esoteric testing
Distributors
Biomerica uses distributors to get its tests onto the market. The company educates its distributors and clinicians on how its tests work, and it also sponsors clinical studies for its tests, according to Irani.
Biomerica posted a profit of $291,640 for a three-month period ended Aug. 31 for a 148% increase from the year-earlier quarter.
Sales came in at $1.7 million, or 21% higher than a year earlier.
Biomerica’s stock trades over the counter without analyst coverage.
“Right now, we operate in niche markets,” Irani said.
The company’s stock is up 73% this year to a market value of about $5.8 million.
Biomerica said in its 10-K filing that immunodiagnostic products are currently produced by more than 100 companies, and that it’s “not a significant player in the overall market.”
It said that it competes with “divisions or subsidiaries of well-established medical and pharmaceutical companies [that] are much larger than Biomerica and expend substantially greater amounts than we do for research and development, manufacturing, advertising and marketing.”
The filing also noted: “[Biomerica offers] a broader range of products than many competitors of comparable size, but have had limited marketing capability. We are working on expanding this capability through marketing and strategic cooperation with larger companies and distributors.”
Buyout Offers
The company has “to entertain [buyout] offers just because we are a public company,” but it prefers to remain independent, Irani said.
Irani has worked there since 1986 and eventually served as vice president of business development. He took the helm as chief executive in 1997.
Prior to that he served as chief executive of a former subsidiary, Lancer Orthodontics, for seven years in the late 1990s and early 2000s.
Besides its local headquarters, Biomerica also has a 10,000-square-foot plant built to FDA specifications in Mexicali, Mexico, where packaging and assembly are done.
