GENOMIC HEALTH, INC. REDWOOD CITY, Calif., Nov. 4, 2014 /PRNewswire/ -- Genomic Health, Inc. (Nasdaq: GHDX) today reported financial results and business progress for the quarter ended September 30, 2014.
Product revenue was $69.1 million in the third quarter of 2014, compared with $65.7 million for the third quarter of 2013, an increase of 5 percent. There was no contract revenue in either period.
International product revenue grew by 12 percent to $11.3 million compared to the same period last year and represented 16 percent of product revenue in the third quarter of 2014.
Net loss in the third quarter of 2014 was $6.3 million, compared with net income of $0.5 million in the third quarter of 2013. Basic and diluted net loss per share was $0.20 for the third quarter of 2014, compared with a basic and diluted net income per share of $0.02 for the same period in 2013.
"In the third quarter, we again delivered test and revenue growth in our U.S. invasive breast cancer business, as well as double digit international growth and triple digit prostate test volume increases," said Kim Popovits, Chairman of the Board, Chief Executive Officer and President of Genomic Health. "We also achieved important, positive milestones in both prostate cancer and breast cancer that we believe will drive reimbursement and further adoption of our tests. Additionally, we look forward to presenting results from the first studies of our NGS-based proprietary liquid biopsy platform at two upcoming medical meetings in December demonstrating significant progress with this important pipeline program."
Additional Third Quarter 2014 and Nine Months Ended September 30, 2014 Financial Results
Total operating expenses for the third quarter of 2014 were $74.9 million, compared with total operating expenses for the comparable period in 2013 of $65.5 million.
Product revenue for the nine months ended September 30, 2014 was $206.6 million, compared with $192.1 million for the nine months ended September 30, 2013, an increase of 8 percent. Total revenue for the nine months ended September 30, 2014 was $206.6 million, compared to $192.8 million for the comparable period in 2013.
Net loss was $18.3 million for the nine months ended September 30, 2014, compared with a net loss of $3.4 million for the nine months ended September 30, 2013.
Cash and cash equivalents and short-term investments at September 30, 2014 were $104.7 million, compared with $105.4 million at December 31, 2013.
In the third quarter, more than 23,700 Oncotype DX(®) test results were delivered, an increase of 9 percent, compared with more than 21,790 test results delivered in the same period in 2013. International tests delivered grew 17 percent compared to last year and represented approximately 20 percent of total test volume in the quarter. Prostate tests more than doubled compared to the prior year and represented approximately 6 percent of total test volume in the quarter.
"While we are pleased to see the continued strength of our U.S. invasive breast cancer business, third quarter test volume was impacted by seasonality and slower growth, primarily in Western Europe," said Brad Cole, Chief Operating Officer and Chief Financial Officer of Genomic Health. "We expect revenue and net income to be within our 2014 guidance and test volume to be just below guidance."
Recent Business Highlights:
Oncotype DX Commercial Progress
-- Centers for Medicare & Medicaid Services (CMS) announced its pricing
methodology recommendation to use "gapfill" to price the Oncotype DX
breast cancer test's unique CPT code through local Medicare
Administrative Contractors (MACs) who have historically covered and
consistently reimbursed the test.
-- The National Comprehensive Cancer Network (NCCN) updated its prostate
cancer clinical practice guidelines to include Oncotype DX as an option
for physicians to consider when determining treatment for men with
localized prostate cancer, referencing both adverse pathology and
biochemical recurrence endpoints as clinically meaningful outcomes.
-- Launched the Your Prostate Your Decision campaign in partnership with
Men's Health Network (MHN), Prostate Health Education Network (PHEN),
ZERO - the End of Prostate Cancer and Joe Torre, baseball legend and
prostate cancer survivor, to encourage men to seek genomic testing, like
Oncotype DX, to enable more confident treatment decisions and avoid
life-altering side effects.
-- Expanded Medicaid coverage for the Oncotype DX breast cancer test,
bringing coverage to more than 40 million Medicaid patients in 35
states.
Pipeline, Presentations and Publications
-- Presented strongly positive results at the European Society for Medical
Oncology (ESMO) 2014 Congress from an additional independent clinical
validation study of the Oncotype DX prostate cancer test that
reconfirmed the biopsy-based test's Genomic Prostate Score (GPS) as a
predictor of adverse pathology at surgery and, for the first time,
validated GPS as a strong independent predictor of a rise in
prostate-specific antigen (PSA) following surgery (biochemical
recurrence).
-- Also presented at ESMO were data highlighting further evidence of the
practice-changing impact of the Oncotype DX test in breast cancer and
the consistent importance of assessing multiple, disease relevant,
biological pathways to predict tumor behavior.
-- Received acceptance from the Society of Urologic Oncology (SUO) to
present additional data from the latest clinical validation study of the
Oncotype DX prostate cancer test, as well as results from the first
prostate cancer decision impact study at its upcoming annual meeting
December 3-5.
-- Received acceptance to present five studies at the 2014 CTRC-AACR San
Antonio Breast Cancer Symposium (SABCS) including an oral presentation
of positive results from the second large, independent clinical
validation study of Oncotype DX in DCIS breast cancer on December 12.
-- Received acceptance from SABCS and SUO to present results from the first
clinical studies using the company's next-generation sequencing (NGS)
based proprietary liquid biopsy platform to detect the presence of
breast and bladder cancers, respectively.
-- In Germany, researchers at the Women's Healthcare Study Group (WSG)
presented early results from the first, large prospective study using
Oncotype DX to stratify treatment for more than 3,000 patients with
nearly three-year follow-up, indicating very high survival rates and low
recurrence rates in patients with low Recurrence Score(®) results.
-- PharmacoEconomics published positive results from a health economic
analysis suggesting that the use of the Oncotype DX colon cancer test
may result in a significant reduction in direct medical costs and
improve patient quality of life by helping patients avoid side effects
of unnecessary treatment.
-- BMC Health Services Research published positive results from a cost
effectiveness analysis demonstrating that the Oncotype DX breast cancer
test is projected to be cost-effective in Japan.
Conference Call Details
To access the live conference call today, November 4 at 4:30 p.m. Eastern Time via phone, please dial (877) 303-7208 from the United States and Canada or +1(224) 357-2389 internationally. The conference ID is 15552266. Please dial in approximately ten minutes prior to the start of the call. To access the live and subsequently archived webcast of the conference call, go to the Investor Relations section of the company's website at http://investor.genomichealth.com/events.cfm. Please connect to the web site at least 15 minutes prior to the call to allow for any software download that may be necessary.
About Genomic Health
Genomic Health, Inc. (NASDAQ: GHDX) is the world's leading provider of genomic-based diagnostic tests that address both the overtreatment and optimal treatment of early stage cancer, one of the greatest issues in healthcare today. The company is applying its world-class scientific and commercial expertise and infrastructure to lead the translation of massive amounts of genomic data into clinically-actionable results for treatment planning throughout the cancer patient's journey, from screening and surveillance, through diagnosis, treatment selection and monitoring. Genomic Health's lead product, the Oncotype DX® breast cancer test, has been shown to predict the likelihood of chemotherapy benefit as well as recurrence in invasive breast cancer and has been shown to predict the likelihood of recurrence in ductal carcinoma in situ (DCIS). In addition to this widely adopted test, Genomic Health provides the Oncotype DX colon cancer test, the first multi-gene expression test developed for the assessment of risk of recurrence in patients with stage II and stage III disease, and the Oncotype DX prostate cancer test, which predicts disease aggressiveness in men with low risk disease. As of September 30, 2014, more than 19,000 physicians in over 70 countries had ordered more than 485,000 Oncotype DX tests. The company is based in Redwood City, California with European headquarters in Geneva, Switzerland. For more information, please visit, www.GenomicHealth.com and follow the company on Twitter: @GenomicHealth. To learn more about OncotypeDX tests, visit: www.OncotypeDX.com, www.mybreastcancertreatment.org and www.myprostatecancertreatment.org.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the company's belief that positive study results will drive further reimbursement and adoption of its prostate cancer and breast cancer tests; the company's expectations regarding reporting study results; the company's beliefs regarding its liquid biopsy platform; the company's intent to continue its investments in DCIS, prostate cancer and international markets; the company's expectations regarding full year 2014 results; the attributes and focus of the company's product pipeline; the applicability of clinical study results to actual outcomes; the company's beliefs regarding the benefits and attributes of its tests; the ability of any potential tests the company may develop to optimize cancer treatment; and the ability of the company to develop and commercialize additional tests in the future. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, and reported results should not be considered as an indication of future performance. These risks and uncertainties include, but are not limited to: the risks and uncertainties associated with the regulation of the company's tests; the results of clinical studies and their impact on reimbursement and adoption; the applicability of clinical study results to actual outcomes; the company's ability to develop and commercialize new tests and expand into new markets domestically and internationally; the risk that the company may not obtain or maintain sufficient levels of reimbursement, domestically or abroad, for its existing tests and any future tests it may develop; the risks of competition; unanticipated costs or delays in research and development efforts; the company's ability to obtain capital when needed and the other risks set forth in the company's filings with the Securities and Exchange Commission, including the risks set forth in the company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2014. These forward-looking statements speak only as of the date hereof. Genomic Health disclaims any obligation to update these forward-looking statements.
NOTE: The Genomic Health logo, Oncotype, Oncotype DX, Recurrence Score, and DCIS Score are trademarks or registered trademarks of Genomic Health, Inc. All other trademarks and service marks are the property of their respective owners.
GENOMIC HEALTH, INC.
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
------------- -------------
2014 2013 2014 2013
---- ---- ---- ----
REVENUES:
Product revenues $69,101 $65,732 $206,580 $192,132
Contract revenues - 258 - 644
--- --- --- ---
Total revenues 69,101 65,990 206,580 192,776
OPERATING EXPENSES (1):
Cost of product revenues 11,979 10,781 36,241 31,285
Research and development 14,742 14,726 42,718 42,189
Selling and marketing 33,208 26,013 100,511 81,587
General and administrative 15,007 14,007 44,750 41,052
------ ------ ------ ------
Total operating expenses 74,936 65,527 224,220 196,113
------ ------ ------- -------
Income (loss) from
operations (5,835) 463 (17,640) (3,337)
Interest income 47 52 144 174
Other income (expense),
net (345) 89 (537) (2)
---- --- ---- ---
Income (loss) before
income taxes (6,133) 604 (18,033) (3,165)
------ --- ------- ------
Income tax expense 129 116 292 223
--- --- --- ---
Net income (loss) $(6,262) $488 $(18,325) $(3,388)
======= ==== ======== =======
Basic net income (loss)
per share $(0.20) $0.02 $(0.58) $(0.11)
Diluted net income (loss)
per share $(0.20) $0.02 $(0.58) $(0.11)
Shares used in computing
basic net income (loss)
per share 31,590 30,661 31,339 30,368
====== ====== ====== ======
Shares used in computing
diluted net income (loss)
per share 31,590 32,324 31,339 30,368
====== ====== ====== ======
(1) Included in operating expenses for
the third quarter of 2014 were
non-cash charges of $5.7
million, including $4.0 million
of stock-based compensation
expense and $1.7 million of
depreciation and amortization
expenses, compared with non-cash
charges for the same period in
2013 of $6.0 million, including
$4.4 million of stock-based
compensation expense and $1.6
million of depreciation and
amortization expenses.
(2) Included in operating expenses for
the nine months ended September
30, 2014 were non-cash charges
of $17.8 million, including $12.6
million of stock-based
compensation expense and $5.2
million of depreciation and
amortization expenses, compared
with non-cash charges for the
same period in 2013 of $17.6
million, including $12.8 million
of stock-based compensation
expense and $4.8 million of
depreciation and amortization
expenses.
GENOMIC HEALTH, INC.
Condensed Consolidated Balance Sheets
(In thousands)
As of As of
December
31,
September
30, 2013
2014
----
(Unaudited)
Cash and cash
equivalents $37,238 $33,279
Short-term marketable
securities 67,452 72,071
Accounts receivable, net 30,967 29,446
Prepaid expenses and
other current assets 9,551 10,196
----- ------
Total current assets 145,208 144,992
Property and equipment,
net 18,099 18,290
Other assets 16,038 13,752
------ ------
Total assets $179,345 $177,034
======== ========
Accounts payable $5,895 $5,160
Accrued expenses and
other current
liabilities 27,503 24,086
Deferred revenues 189 586
Other liabilities 2,130 2,221
Stockholders' equity 143,628 144,981
------- -------
Total liabilities and
stockholders' equity $179,345 $177,034
======== ========
The condensed consolidated
balance sheet at December 31,
2013 has been derived from the
audited consolidated financial
statements at that date
included in the company's Form
10-K for the year ended
December 31, 2013.
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SOURCE Genomic Health, Inc.
