Aris Kekedjian : So Jim, just talking on context on the revenue. Effectively, you look at kind of where we are quarter-over-quarter and year-over-year, we’re kind of — all of the ins and outs of COVID, both the VTM upside and the effect on hemoglobin because of all the COVID testing. All that’s kind of washing out, and we’re basically flattening out on revenue or somewhere around $19 million to $20 million in that range. And the idea is to build from there. So that’s kind of where we’re playing out right now. And that’s kind of where John and I are building our base case kind of from this kind of flattening out point in terms of the next 3-year plan.
Jim Sidoti : Right. So basically, you start out with $75 million, $80 million business, and then you expect to grow it from this point based on the increased sales for the HIV test and the autoimmune and diabetes test.
Aris Kekedjian : Yes. And some of the initiatives that I highlighted, I think, have real growth potential in ’23 and ’24. So I think at the end of the day, we feel like we’re — yes, we’re at the run rate now from where do we want to build a plan.
Jim Sidoti : And at what level do you think you need to achieve of revenue to obtain profitability on the bottom line?
John Gillard : We’re really attacking it 2 ways, Jim, right? So obviously, we want to grow revenue, but we’re very, very focused on growing gross margin as well — gross margin contribution, okay? So we — I think we flagged previously the average selling price of the TrinScreen HIV test will be lower than the Uni-Gold test, okay? So we expect that would have a margin percentage erosion but will add to gross margin contribution, okay? And then we’re very focused on managing our SG&A costs and overall — our overall cost basis. So I wouldn’t want to give guidance in terms of what level will reach overall profitability. It will depend on progress around not just the revenue number, but also as we look to optimize our gross margin.
So Aris spoke about, for example, if we take our hemoglobins business, we’re looking to in-source there a significant aspect of our consumable production. We think that could add somewhere around $1 million to our bottom line on an annual basis through that action. We will not hit that for a full year for 2023, but I’d expect we’d hit that for full year 2024. So we’ll — we’re executing on that at the moment, and I think it will start paying dividends in early 2023. So there’s a number of key initiatives that we’re focused on to make the business much more efficient rather than just rely on revenue growth to get us to breakeven. So what we’re really focused on is revenue growth and efficiency to get us to significant profitability.
Aris Kekedjian : Look, I mentioned the 3-year plan on hemoglobins. I’m — we are looking at a business that should have gross margins well in excess of 50% and operating profit margins pretax in the 20% maybe plus or minus range. So — in a 3-year time frame. So we’re — that will be a healthy profitable — and that’s our largest business. The areas right now that we’re spending some time really vetting out is point of care, how do we position the lab and the product business in point of care to take advantage of high-margin opportunities in developed markets as well as we currently have in — especially in the case of the product business in the developing markets. That partnership strategy — and we feel very confident in terms of what opportunity we have at the lab level, but that strategy is a very high-margin strategy, both for the — both for our Irish-based lateral flow business as well as our lab business.
So I think that’s going to be one of the key drivers, but we’re putting some work around that, and we’re in discussion with a number of partners, and that will determine that model for us shortly. Autoimmune, to be honest, has got tremendous growth potential. It’s small right now. And that’s an area where we may be willing to, in the short, medium term, significantly invest to take advantage. So the idea is between now and the Piper Conference, we’ll have this thing pretty much narrow down, and we’ll have a pretty good 3-year view.
Jim Sidoti : Okay. And then the last one from me. Are you actively working on refinancing the remaining piece of that 14% debt?
Aris Kekedjian : Well, look, the market is a little fluid right now. And one of the things that John and I discussed when I got involved was refinancing the debt has penalties associated with it, okay? When you do all the math, in the short term, it’s a fair bit of penalty for the amount of refinancing benefit you’re getting. Now what I have been thinking about with John here is we’ve got a number of potential transaction or partnership opportunities in front of us and that we’re probably better off going to both debt and equity investors around a transaction ID and do a refinancing once as opposed to doing it twice and paying a penalty. So we’re trying to be prudent. I mean I don’t — 14% of money is stupid, right? I mean that doesn’t make sense to sit on. So that’s not my intent. I expect to refinance out of it. I just want to make sure that — John and I want to make sure we’re being clever about it.
Jim Sidoti : Understood.
John Gillard : Yes. And just through the early repayment and we have taken a significant piece of that cash cost out. And so it’s not as — while the rate is high, the amount are substantially less than we had previously taken some of the cost out.
Operator: the next question is from Paul Nouri of Noble Equity.
Paul Nouri : What do you see is the size for the variant instrument, the size of the market for the —
