We should be profitable. And then those profits start to extend. Nebula is a little more complicated, because we have a lot of overhead to build the business. But once the business starts to take off, the overhead becomes much less significant. And all of a sudden, you see a lot of profits flow to the bottom line. And that’s going to happen could happen very, very quickly, to be honest with you. And that’s why we’re trying we have — we’re the only laboratory in the country with high capacity, whole genome sequencing equipment, at the price — at the low price points that we have. And so — and we’re the first lab in the country to get the next piece of this equipment, we’re next in line, so the next piece of equipment. So our capacity is going to go up significantly.
And we have businesses that want to bring us enormous amounts of high margin business to us. So those numbers are going to start to improve. So whatever the negative cashflow is, now, it’s going to be I believe, it’s going to be less than less each quarter at the same time, and don’t quote me on that on a short term basis. The negative cash flow whether we acquire some more equipment that we depreciate a little bit more things of that nature. But in general, all those numbers are going to be improving. And at the same time, as I mentioned, yes, we do have access to a mortgage at Pharmaloz, the interest rates are higher. But the way I look at it, even though the interest rates are higher than they would have been six months ago. Whatever the interest expense is on any money that we raise in the debt markets right now, even if it’s at a higher interest rate, the cluster that for one year pales in comparison, it’s a rounding error compared to the opportunity and the revenues and earnings that I think that we’re going to be generating.
So we do have access to capital both mortgage at Pharmaloz as well as that our accounts receivable. Our accounts receivable is improving actually even as I mentioned, just from the second quarter to the third quarter, or accounts receivable went down from $39 million to $33.4 million. It will continue to improve, we continue to receive dollars are flowing in from that. I just don’t know if that’s going to accelerate. That’s the frustrating part. But they are flowing into that. So I think that between a credit facility and accounts receivable not to mention, we have a very strong asset base, as well as the mortgage that will more than bridge us that don’t quote me, it’s not a guaranteed forward-looking statements. But as of today, that will more than bridges us to when the company is profitable, and will more than bridge us to options that we may have.
If we want to explore other ways to bring out value in our subsidiaries. When you have subsidiaries like ours that are exploding in revenues, and earnings and dynamics next year, it will create opportunities for liquidity events if we choose to go down that path. And I would certainly go down a path like that before I would ever do anything to raise capital for ProPhase labs the entire company. So I hope I answered your question. We took up a lot of time just with you. I would like to move to our next question. But thank you, Adam, for your question. And your support. Much appreciated. Nick, if you can go to the next question, please.
Operator: Yes, that’ll be from Yi Chen, H.C. Wainwright and company, please go ahead.
Yi Chen : Hi, thank you for taking my questions. Could you give us some color within the total revenue for the third quarter? How much of it was based on testing and whether you expect those testing revenue to pretty much disappear in the fourth quarter?
Ted Karkus : Yeah, so COVID testing has disappeared. It disappeared in the third quarter. I noticed there was a very little bit of testing at the beginning of this quarter, I apologize, I don’t if we didn’t break it out. And I can get those numbers for you afterwards, or CFO can. But I don’t know what the revenues were, it obviously had to be minimal. It was a very small number of tests, we did put that into the press release. So the rest of the revenues are obviously Nebula Genomics and Pharmaloz manufacturing. And, as I mentioned, as you now go into the fourth quarter, those numbers start to pick up and then where they really start to pick up as in first quarter. And so I would expect a significant increase in revenues, and actual profitability for Pharmaloz.
And I would also expect a significant pickup in revenues, and profitability for Nebula not counting. I don’t know what the numbers are going to be relative to our overhead. So whether we’re going to be profitable, I don’t want to be quote on which quarter we’re going to be profitable. But the revenues are going to improve significantly in the first quarter. I believe these are my estimates again, forward-looking statements. But I believe based on the indicated demand, and I’m talking about it, as first of all the demand, as Pharmaloz as I said, we have demand already, for when we build our capacity in the second quarter, when we get up to $30 million, we already have that $30 million demand in contract. All right, and then we have these two large lozenge brands who are about to go into contract with us.
