Thank you everyone for joining the call today. We had another outstanding quarter, third quarter for 2022, and Chris and I are excited to provide you with key results and an overview of the quarter, as well as to give you an update on our growth strategy, ELEVATE. We want to take this opportunity to also talk to you a little bit more about the market areas where we see the highest potential for the adoption of optical genome mapping. Now turning to our third quarter results, total revenue was $7.2 million for the quarter, which represents another record revenue for the company and an increase of 55% over the third quarter in 2021. We've seen revenue growth compared to the same time last year across APAC, Europe, Middle East, Africa, and AmErikas, and so we're very pleased with this progress.
We sold 3,975 flow cells in the quarter, which is a record for the number of flow cells sold in any quarter in the company's history, and that represents a 17% sequential increase over the second quarter of this year. It's comparable to the 3,969 flow cells we sold a year ago in 2021. We analyzed 369 samples in our laboratories, which represents 19% growth over the third quarter in 2021, and we ended the quarter with an installed base of 217 Saphyr systems, which is growth of 54% over the 141 systems installed at the end of the third quarter in 2021, and an 11% sequential increase over the second quarter of this year.
Another area where we saw significant progress was in Bionano Laboratories, which officially launched this quarter. Bionano Labs is a new organization that combines our optical genome mapping data services with the clinical testing services that were previously known as Lineagen. We've also launched the first optical genome-based, mapping-based laboratory developed test out of Bionano Labs, and we received CLIA certification for the San Diego lab. Now, this certification is important because it enables Bionano Laboratories to offer services to customers who seek to implement optical genome mapping into their clinical routines and for research applications with hospitals, pharmaceutical companies, and other groups that require a more robust regulatory structure for their projects. At this point, I'd like to turn the call over to Chris, so he can go a little deeper into the financials for the quarter.
After Chris's remarks, I will provide updates to the five strategic pillars in the growth strategy and then discuss the market potential we see for optical genome mapping in key areas, including cytogenomics, discovery research, and something we haven't been talking a lot about but is really exciting, called cell bioprocessing QC. Chris?
Thanks, Erik. The third quarter of 2022 was another outstanding quarter for Bionano. As Erik mentioned, we recorded significant year-over-year revenue growth and continued growth in the installed base of our Saphyr systems. We believe the building excitement in the market about the capabilities of our products is driving the revenue momentum we are seeing. Revenue in the third quarter of 2022 was $7.2 million, representing an increase of 55% over the third quarter of 2021, and our highest quarterly revenue to date. We came in just above our previous guidance range of $6.7-$7.1 million, mainly due to stronger than expected sales of NxClinical software.
Gross margins for the third quarter came in at 25%, in line with the third quarter of 2021, and a 3% improvement over the 22% we saw in the second quarter of 2022, due to improvements in chip production yields and the favorable product mix in the quarter. We are making good progress on improving yields, and we expect to see continued gross margin improvements in the coming quarters. Third quarter 2022 GAAP operating expense was $34 million, compared to $21.8 million in the third quarter of the prior year. Q3 2022 Non-GAAP operating expense was $26.4 million, compared to $18.7 million in Q3 of 2021, and roughly flat to the $26.3 million in Q2 2022.
Q3 2022 Non-GAAP operating expense includes $6.1 million in stock-based compensation, $1.4 million in amortization of intangibles, and $100,000 of transaction-related expenses. The year-over-year increase in OpEx was primarily due to increased headcount and related spending. Our capitalization remains strong, with $180.2 million in cash equivalents, and available for sale securities as of September 30th, 2022. That includes $22.5 million in net proceeds raised through the sale of 6.6 million shares in Q3 2022 under our ATM facility.
Looking forward, we expect revenues in the fourth quarter to be in the range of $7.5-$8 million, which would imply full year revenue in the range $27.1-$27.6 million. This number is slightly above the top end of our prior full year guidance range of $24-$27 million. Before I turn it back over to Erik, I want to quickly mention that we plan to hold our first strategy day this coming February. More information will be forthcoming in the near future. With that, I'll turn it back to Erik.
Thanks, Chris. Our strategy for growth, which we call Elevate, is based on five key pillars. To expand commercial traction and validation of optical genome mapping with Saphyr, to delight our customers with robust products, to clear the path for reimbursement of OGM-based tests, and change medical practice to include optical genome mapping in medical society guidelines, to advance our products to enable and support higher market adoption and entry into new markets, and lastly, to make software a strategic driver of our solutions. Now recently, we've added a sixth pillar, and that's that we focus on doing all of these things in a way that's scalable to meet the demands of our growth environment. We've seen great momentum in the adoption of OGM and its validation for use this last quarter.
Last week, at the AmErikan Society of Human Genetics, or ASHG Conference, they featured the first dedicated scientific session on genome mapping technologies, where researchers from around the world highlighted optical genome mapping as a technique that has the potential to revolutionize molecular and cytogenetic research. Bionano recently held its first scientific meet the user event in the company's history, where we brought together over 50 researchers who are curious about optical genome mapping, seeking to find out where it fit into their lab and what applications they could run on it. These folks came to San Diego from all around the world and visited Bionano Laboratories, which is now a showcase for excellence in optical genome mapping. They were able to see demonstrations of the Bionano Saphyr system and its workflow, as well as our NxClinical software.
We've continued our previously announced collaboration with Hamilton to release an automated sample prep solution for customers. In support of this effort, we've been developing new chemistries, which will be part of the world's first walkaway automation for ultra-high molecular weight DNA extraction with the Hamilton Long String VANTAGE system. That system has the potential to double throughput and deliver increased confidence in sample yields and DNA quality, making it easier than ever to adopt optical genome mapping at scale. Last week at ASHG, we were excited to announce together with Hamilton, that this platform will be shipping commercially in early 2023.
Now regarding the progress in reimbursement, our plans for a category one CPT code reapplication remain on track, and we have seen significant progress in the field for sites with laboratory developed tests, or LDTs, that are based on optical genome mapping, who have gone and applied for reimbursement codes known as PLA codes or proprietary laboratory analysis codes. They have been reporting that these codes now have established pricing. The 2022 gap fill recommendations were released by the Centers for Medicare & Medicaid Services, or CMS, for use in constitutional genetic testing with OGM, and they include reimbursements of $1,263.53 for two PLA codes, and a reimbursement for $6,739.33 for another PLA code.
The first two codes that I mentioned are for use of OGM in whole genome analysis for constitutional genetic disease, and the second one that I mentioned is for the combination of optical genome mapping and next-generation sequencing. We're very gratified to see that reimbursement for optical genome mapping is now possible, and we see optical genome mapping on the clinical diagnostic laboratory fee schedule. This is very significant progress for us. The clinical studies that we are working on remain the backbone of our evidence to support OGM in changing medical practice through revising medical guidelines. We remain on track to meet our previously outlined milestones for this year, and we have made progress on a new version of our NxClinical software, which will integrate optical genome mapping data alongside other data types.
Finally, we remain on track to have a pre-commercial version of the next generation mapping instrument in the field before the end of this year. Now during this quarter, Soheil Shams, who has been our Chief Informatics Officer since the acquisition of BioDiscovery, transitioned out of his day-to-day activities and became the CIO Emeritus, which means that he is a consultant to the company for assistance and guidance in software development. During the 25 years since forming BioDiscovery, Soheil has established himself and his team as global thought leaders in genome analysis. The products and services they created, including NxClinical, are recognized around the world as providing powerful solutions for visualization, interpretation, and reporting of genome variation.
Now Bionano will take it forward to finalize the addition of structural variation and create a tool that will really transform the way the world sees the genome. Now in closing, I would like to spend some time discussing the market opportunities for optical genome mapping, which we see as approximately valued at about $8 billion across the areas of cytogenomics, discovery research, QC for cell bioprocessing, and a handful of other applications. We estimate the number of cytogenetic labs on a worldwide basis to be approximately 6,000 cytogenetic labs, and the number of samples that they are analyzing to be approximately 4.2 million per year. We also know that there are about 15,000 sequencers installed worldwide.
We think about the opportunity to transform the cytogenetic workflow by adding Saphyr and OGM, as well as complementing sequencing with optical genome mapping, we estimate that these two opportunities amount to a market potential of about $4 billion. In cytogenetics and molecular pathology, optical genome mapping is not only supported by emerging reimbursement, but now by a number of studies that validate its use as a replacement for traditional methods like karyotyping, fluorescence in situ hybridization or FISH, chromosomal microarray, or as a complement to next-generation sequencing. We believe that this ability to detect structural variations is well suited in cancer and genetic disease applications. This quarter, we saw several research studies validating OGM's use in solid tumor and hematologic malignancy applications.
They all indicated that optical genome mapping workflows could lead to changes in important information used in patient management, like prognostic scoring and treatment recommendations in a variety of areas, including leukemias, lymphomas, myelodysplastic syndrome, and others. We believe the use of optical genome mapping may provide cancer researchers for a better understanding of the causes of cancer, which could lead to new diagnoses and therapies. Evidence for these views has been published.
Four peer-reviewed studies in the third quarter from researchers at sites including MD Anderson Cancer Center, Augusta University, as well as a multi-site study in Europe, all validated optical genome mapping's ability to not only see what traditional methods see, but find additional pathogenic variants in MDS, acute myeloid leukemia, chronic lymphocytic leukemia, as well as myeloid malignancies, suggesting that the identification of these previously undetected variants may impact prognosis and offer improved insight into the genomic architecture of heme malignancies and tumors in a way that would provide for better classification, risk stratification, and therapy selection. Genetic disease as well, we see growing support for OGM. Two recent studies from researchers in China showed progress in this area. One study this quarter used optical genome mapping to detect balanced chromosomal rearrangements that were not detected by traditional methods, but found in subjects who had experienced recurrent pregnancy loss.
A recent study successfully evaluated optical genome mapping for investigation of abnormal non-invasive prenatal testing, suggesting that optical genome mapping could be used as a reflex test for positive NIPT tests, as well as ambiguous ones. These are very powerful applications for optical genome mapping in genetic disease. We also saw the publication of the first study to evaluate OGM in the analysis of certain repeat expansion disorders, where researchers successfully used optical genome mapping to replace Southern blot, which has been the gold standard for sizing these repeat expansions historically. Repeat expansion disorders are a class that impact approximately one person in 3,000 people, and so they have a significant incidence in the population.
OGM also has great potential in discovery research, as we've been talking about, either as a standalone tool or with sequencing. We believe discovery research is an area of such enormous potential because structural variations are highly biologically and clinically relevant. Historically, there hasn't been a tool capable of the kind of comprehensive and sensitive for detection of structural variations that optical genome mapping offers. With such a tool, we believe that optical genome mapping could become a new gold standard for structural variation detection, 500 base pairs and bigger throughout genome analysis. I wanna talk about an area of the market that is increasingly significant and interesting, as well as one that's pretty unique to optical genome mapping, and that's this area that we call cell bioprocessing QC or quality control.
This methodology entails evaluating intended and unintended modifications to genes in cells used for therapeutic applications such as immune cell therapy, stem cell therapy, and other areas where gene editing has a therapeutic benefit. Two studies this quarter showed OGM's utility involving induced pluripotent stem cell lines, one with potential application for autologous cell therapy and one for allogeneic cell therapy. Autologous cell therapy uses an individual's cells, cultures them, engineers them to transform and modify them. They're then expanded in vivo and introduced back into the patient. Allogeneic follows a similar process, but based on universal cell lines. One study validated OGM's ability to detect SVs that had not been seen by traditional methods.
Now, this is really important because these off-target or spurious events may impact the genome integrity of these cells that are used in therapy and bring about poor performance or poor safety. The other study used optical genome mapping as part of a quality control workflow to evaluate iPSC quality and genomic integrity in allogeneic therapies, again, to minimize the potential for immune rejection of donor cells by the recipient. We're excited to see the support for OGM as a new method in this space, and we believe this validation helps Bionano expand beyond the research and clinical diagnostics areas into uses of OGM for drug development and cell therapy applications. Now in closing, I just wanna reiterate that we are excited about our continued growth in 2022.
I wanna emphasize that we are on track to meet all of our outlined Elevate milestones, and we look forward to updating you on our progress during the Q4 call. As Chris mentioned, and I wanna reiterate that we would also like to share that we will be hosting an investor and analyst event in February of 2023. This is what we call our strategy day, and we'll give you more specifics on that, in due time. With that, operator, we are now ready to open the floor for questions.
If you would like to ask a question, please signal by pressing star one on your telephone keypad. If you are using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, if you would like to ask a question at this time, please press star one. We'll pause for just a moment to allow everyone the opportunity to signal for questions. We will take our first question from Jeffrey Cohen with Ladenburg Thalmann. Please go ahead.
Hi, Erik and Chris. How are you?
Hey, Jeff.
Hi, Jeff.
A few questions for us. Firstly, on the services and other number, which was strong for the quarter, very strong. Should I assume that includes some money from the San Diego CLIA lab?
Yeah, that number does include all of our services, which yes includes revenue from the San Diego CLIA lab, which is continuing to process samples as we have for the last several years now.
Got it. Okay. Then Erik, talk a little bit about Hamilton and Vantage and the launch of this new product line. I understand that you'll be supporting them as far as the units and all the reagent kits. Could you talk about perhaps the size of that market as they see it or you see it, and some of the competitive advantages that the system has out there in the marketplace?
Yeah, sure. Happy to. A couple of things. As you know, Hamilton is one of the handful or very small number of global leaders in workflow automation. For them to create this program and invest in it, I think is really significant validation of the emergence of optical genome mapping as a mainstream technique throughout genomics. I don't think that they would put the resources behind this project if they didn't see the potential. We're excited about that. If you think about the market size for ultra-high molecular weight DNA isolation, which this robot is expressly developed for, we talked about these 6,000 cytogenetic labs worldwide. We talked about 15,000 sequencers worldwide.
I've got to believe that Hamilton views the potential of putting automation in many of those labs, as we view the potential for putting Saphyr in all of those labs. Not every lab is gonna need automation, but it certainly simplifies the workflow, makes it more consistent and more robust. What we see in labs is that their throughput is beginning to consistently ramp up, especially in Europe, where they've been going through a phase of validation and beginning to build a menu of applications. Automation at this time makes a lot of sense. If you ask me, do I think every site is gonna wanna have automation? I think that there will be sites that continue to process samples manually, but the opportunity is very significant. Otherwise, Hamilton wouldn't get behind it.
Got it. Secondly from us, congratulations on the news with CMS, right? This is the gap fill final recommendations. Has that gone into effect or when does that go into effect for the two codes you outlined?
There's three of them. Two in constitutional genetic disorders, and then one. Well, they're all in constitutional, but two of them are for OGM alone, and then one is for the combination of optical genome mapping and sequencing. They are in effect now, and I think that's in the last week or so. Now you gotta keep in mind, you know, this is important for everybody to be clear about, these are what we call or what CMS calls proprietary laboratory analysis codes, and they are unique to the lab that has developed the LDT and applied for the code.
I will tell you that having CMS go through the process to study and analyze and discuss at the panel level, and then go through a process of gap fill to price these codes, that the next steps for other labs following the same path will be more straightforward. I think we're finally in a period where we can say that there's reimbursement for OGM. Early days, but it exists.
Yeah. Fantastic. I know you've been working on that for a number of years. That does it for us. Thanks for taking the questions.
Thanks, Jeff.
Thank you, Jeff.
We will take our next question from François Brisebois with Oppenheimer. Please go ahead.
Hi. Thanks for taking the questions. Just, so congrats again on the CMS and the reimbursement progress and kinda, you know, hope or just the fact that it's out there now for OGM a little more here. I was just wondering, in terms of practices changing, you know, what they do, is reimbursement probably the main driver of a potential hockey stick kind of growth in terms of top line? Or is it more a combination of publications and more validation, getting the word out, or was this really kind of one of the key drivers here?
Well, I think that you really do need to think in terms of a combination or a multifactorial process of demand creation through illustration of utility that's validated in the publications, combined with pulling down barriers to adoption, such as reimbursement. All of these things are ongoing in parallel, but they accelerate continuously. We're here at the Association for Molecular Pathology meeting, AMP, in Phoenix, and we were talking about the number of human genomes that have been analyzed and published in the last year or so, and it's a little over 1,000 human genomes . At this point last year, in the history of the company, it was 300 human genomes , right? 300 human genomes for the history of the company up until October 2021.
From October 2021 until October of 2022, triple that in one year. These things accelerate as we're moving through time and pushing forward on all of these different fronts, and as a result, that's what really drives the revenue growth. You said hockey stick, I'll just say the revenue growth. You know, I know that down the road, you're gonna expect us to continue the revenue growth. When we see, you know, this initial reimbursement, that's gonna pull some folks in who are on the sideline. When we see this automation that comes out, we'll see some people come in from the sidelines who were waiting for the automation. They will do work and publish papers, which will in turn drive some additional folks in from the sideline.
We'll see things like we hope or we believe we will see things like private payers coming on board, so on and so forth. It really is multifactorial, but I can tell you that the process is accelerating on all fronts.
Okay. No, that's very helpful. Maybe can you just touch on, do you see any seasonality in the business, or does it not affect the business as much as maybe others in summer months? Also maybe just touch on, you know, in the press release, there's a couple of publications that are mentioned and talked about. I'm just wondering, in terms of the research, if there's one in particular, or again, it's kind of multifactorial where all of these are extremely helpful or are some more important than others? Thank you.
Yeah, I'll start by answering the seasonality question and then let Erik weigh in on publications. We have seen over the past several years, typically we're stronger in the second half of the year, as companies get their arms around their budget, and then in Q4, typically they're, you know, spending their budgets before they lose it. Seasonality is a little bit slower in Q1, with, among other things, Chinese New Year and then, you know, people kind of getting slowly back to work after the holidays. Yeah, that's what we've seen. Typically, seasonal strength in the second half of the year, little bit seasonal, seasonally weaker in the first half of the year. Erik, do you wanna talk about the publications?
Yeah, I mean, I think, listen, we've seen a number of significant publications that have come out certainly in the third quarter. I think one of the most impactful ones, and we talked about it during our last call, so I don't wanna seem like I'm diminishing the impact of the others, but the paper from Dr. Rashmi Kanagal-Shamanna from MD Anderson Cancer Center, I don't think that we can really understate or overstate how significant that is, because she touched on a number of different areas in that publication where optical genome mapping really dramatically impacts the patient management workflow in myelodysplastic syndrome, which was the topic of her paper, but I think it's reasonable to extend that throughout hematologic malignancies.
There are other aspects of that publication which go into depth about the relationship between new findings that optical genome mapping revealed and existing clinical trials for treatment. When you begin to put together and kind of connect all the dots in that paper, you realize that that's a seminal work that really highlights, number one, the impact of optical genome mapping, but number two, the importance of driving these new methods forward. Of course, we're doing this here in Bionano Genomics 'cause we have an incredible platform, and we know we can build a great company behind it. We really have to be focused on the importance of innovation in healthcare because at the end of the day, this changes people's lives, and it certainly helps them in some of their most desperate times.
I think that's the most significant paper that really was published this quarter.
Okay, great. Thank you very much.
Thank you.
There are no further questions at this time. Dr. Holmlin, I will turn the conference back to you for any additional or closing remarks.
Okay, Cynthia, I wanna thank everybody for joining the call, and we look forward to updating you on the fourth quarter call after the first of the year. Thank you very much.
This concludes today's call. Thank you for your participation. You may now disconnect.