GENOMIC HEALTH, INC. REDWOOD CITY, Calif., Nov. 1, 2016 /PRNewswire/ -- Genomic Health, Inc. (Nasdaq: GHDX) today reported financial results and business progress for the quarter ended September 30, 2016.
Total revenue was $82.3 million in the third quarter of 2016, compared with $73.6 million in the third quarter of 2015, an increase of 12 percent.
U.S. product revenue was $70.0 million in the third quarter of 2016, an increase of 11 percent, compared with $63.0 million in the same period in the prior year. Prostate test revenue in the U.S. of $2.3 million contributed to approximately 3 percent of the year-over-year growth.
International product revenue was $12.1 million in the third quarter of 2016, compared with $10.5 million a year ago, an increase of 15 percent. International revenue on a constant currency basis increased by 18 percent compared with a year ago.(i)
In the third quarter, more than 29,990 Oncotype(®) test results were delivered, an increase of 8 percent, compared with more than 27,820 test results delivered in the third quarter of 2015. U.S. invasive breast tests delivered grew 5 percent and prostate tests delivered grew 6 percent compared with the prior year. International tests delivered grew 15 percent compared with the prior year and represented approximately 24 percent of total test volume in the third quarter of 2016.
"In 2016 we have delivered three consecutive quarters of double-digit revenue growth, with 15 percent revenue growth and 12 percent test growth year-to-date, in line with our guidance provided in February," said Kim Popovits, chairman of the board, chief executive officer and president of Genomic Health. "We believe these results demonstrate the strength of our business, including the importance of continuing to generate clinical data that differentiate our Oncotype IQ(TM) portfolio of products. Specifically, in invasive breast cancer, Oncotype DX remains the only genomic test proven to predict chemotherapy benefit and, with our latest clinical validation study in prostate cancer announced today, we now provide the only test to predict all major short- and long-term outcomes."
Operating loss for the third quarter of 2016 improved to $3.0 million, compared with $5.4 million for the third quarter of 2015. The operating loss includes a favorable impact in the quarter from the satisfaction of certain royalty payment obligations for the license of PCR patents, as well as an unfavorable impact from a write-down of a software development project for interactive digital reporting. These two items were approximately $2.5 million each and individually off-set each other.
Net loss was $2.8 million for the third quarter of 2016 compared with a net loss of $11.8 million for the third quarter of 2015. Basic and diluted net loss per share was $0.08 for the third quarter of 2016, compared with basic and diluted net loss per share of $0.36 for the same period in 2015.
Total revenue for the nine months ended September 30, 2016 was $245.1 million, compared with $212.3 million for the nine months ended September 30, 2015, an increase of 15 percent.
Operating loss improved to $16.9 million for the nine months ended September 30, 2016, compared with an operating loss of $30.9 million for the nine months ended September 30, 2015. Net loss was $15.3 million for the nine months ended September 30, 2016, compared with a net loss of $30.6 million for the nine months ended September 30, 2015.
Cash and cash equivalents and short-term marketable securities at September 30, 2016 were $83.6 million excluding the fair value of the company's investment in a marketable security of $15.0 million, compared with $76.8 million at December 31, 2015 excluding the fair value of the company's investment in a marketable security of $18.1 million.
Recent Business Highlights
Oncotype DX Commercial Progress
-- As of September 30, 2016, the company's flagship line of Oncotype DX
gene expression tests has been used to guide treatment decisions for
more than 700,000 cancer patients worldwide.
-- Established an additional coverage for the Oncotype DX Genomic Prostate
Score(TM), bringing the total number of prostate cancer covered U.S.
lives to more than 61 million.
Presentations and Publications
-- Announced positive topline results from a prostate cancer clinical
validation study demonstrating Oncotype DX is a strong predictor of the
development of metastasis and prostate cancer death in patients with
early-stage disease. With these new results, the Oncotype DX prostate
cancer test becomes the first genomic test validated in all major short-
and long-term end points, including adverse pathology, biochemical
recurrence, metastasis and prostate cancer specific death.
-- Reviews in Urology published a comprehensive economic analysis
demonstrating use of Oncotype DX in low-risk prostate cancer patients
leads to an increase in a net uptake of active surveillance and a net
savings of $2,286 per patient - including the cost of the test - by
decreasing unnecessary immediate invasive treatment.
-- Presented results from eight Oncotype DX Breast Recurrence Score(TM)
presentations at the European Society for Medical Oncology (ESMO) 2016
Congress, highlighting superior clinical evidence in identifying which
patients with node-negative and node-positive invasive breast cancer
should be treated with chemotherapy. To date, the unique clinical
utility of Oncotype DX has been demonstrated with prospective outcomes
results in over 63,000 breast cancer patients.
-- Presented robust analytical validation study results on Oncotype SEQ(®)
Liquid Select at the ESMO 2016 Congress. The results demonstrated that
this liquid biopsy mutation panel is highly sensitive, specific and
reproducible.
-- Received acceptance to present seven studies at the 2016 CTRC-AACR San
Antonio Breast Cancer Symposium (SABCS) in December.
Conference Call Details
To access the live conference call today, November 1, 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 6320020. 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 help optimize cancer care by addressing the overtreatment of the disease, one of the greatest issues in healthcare today. With its Oncotype IQ(TM) Genomic Intelligence Platform, the company is applying its world-class scientific and commercial expertise and infrastructure to lead the translation of clinical and genomic big data into actionable results for treatment planning throughout the cancer patient journey, from diagnosis to treatment selection and monitoring. The Oncotype IQ portfolio of genomic tests and services currently consists of the company's flagship line of Oncotype DX gene expression tests that have been used to guide treatment decisions for more than 700,000 cancer patients worldwide. Genomic Health is expanding its test portfolio to include additional liquid- and tissue-based tests, including the recently launched Oncotype SEQ(®) Liquid Select assay. The company is based in Redwood City, California, with international headquarters in Geneva, Switzerland. For more information, please visit, www.GenomicHealth.com and follow the company on Twitter:@GenomicHealth, Facebook, YouTube and LinkedIn.
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 beliefs regarding its future performance, including its 2016 full year guidance; the commercial performance of its tests; the attributes and focus of the company's product pipeline; 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 has all rights necessary to commercialize its tests; 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, 2016. 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, DCIS Score, Oncotype SEQ, Oncotype IQ and Genomic Prostate Score are trademarks or registered trademarks of Genomic Health, Inc. All other trademarks and service marks are the property of their respective owners.
i Constant currency was
calculated by comparing the
company's quarterly average
foreign exchange rates for the
three and nine months ended
September 30, 2016 with the
comparable periods of 2015.
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,
------------- -------------
2016 2015 2016 2015
---- ---- ---- ----
REVENUES:
Product revenues - United
States $70,041 $63,051 $210,092 $181,459
Product revenues - Outside
of the United States 12,095 10,503 34,824 30,866
------ ------ ------ ------
Total product revenues 82,136 73,554 244,916 212,325
Contract revenues 122 - 210 -
--- --- --- ---
Total revenues 82,258 73,554 245,126 212,325
OPERATING EXPENSES (1)(2):
Cost of product revenues 13,062 13,718 44,083 39,513
Research and development 15,109 13,480 46,397 47,193
Selling and marketing 38,838 35,369 116,327 107,964
General and administrative 18,268 16,425 55,243 48,594
------ ------ ------ ------
Total operating expenses 85,277 78,992 262,050 243,264
------ ------ ------- -------
Loss from operations (3,019) (5,438) (16,924) (30,939)
Interest income 117 54 282 163
Gain on sales of marketable
securities - - 2,009 -
Other income (expense), net (111) (158) (174) (207)
---- ---- ---- ----
Loss before income taxes (3,013) (5,542) (14,807) (30,983)
------ ------ ------- -------
Income tax expense
(benefit) (193) 6,301 464 (410)
---- ----- --- ----
Net loss $(2,820) $(11,843) $(15,271) $(30,573)
======= ======== ======== ========
Basic and diluted net loss
per share $(0.08) $(0.36) $(0.46) $(0.95)
Shares used in computing
basic and diluted net loss
per share 33,391 32,498 33,141 32,294
====== ====== ====== ======
(1) Included in operating expenses for
the three months ended September
30, 2016, were non-cash charges
of $7.0 million, including $4.7
million of stock-based
compensation expense and $2.3
million of depreciation and
amortization expenses, compared
with non-cash charges for the
same period in 2015 of $5.6
million, including $3.9 million
of stock-based compensation
expense and $1.7 million of
depreciation and amortization
expenses.
(2) Included in operating expenses for
the nine months ended September
30, 2016, were non-cash charges
of $20.8 million, including $14.1
million of stock-based
compensation expense and $6.7
million of depreciation and
amortization expenses, compared
with non-cash charges for the
same period in 2015 of $17.2
million, including $12.1 million
of stock-based compensation
expense and $5.1 million of
depreciation and amortization
expenses.
GENOMIC HEALTH, INC.
Condensed Consolidated Balance Sheets
(In thousands)
As of As of
December 31,
September 30,
2015
2016
----
(Unaudited)
Cash and cash
equivalents $33,999 $32,533
Short-term
marketable
securities (1) 64,602 62,410
Accounts
receivable, net 33,682 37,164
Prepaid expenses
and other
current assets 12,066 10,843
------ ------
Total current
assets 144,349 142,950
Property and
equipment, net 39,465 39,746
Other assets 8,137 1,921
----- -----
Total assets $191,951 $184,617
======== ========
Accounts payable $5,411 $8,585
Accrued expenses
and other
current
liabilities 38,505 33,656
Deferred
revenues 28 431
Other
liabilities 3,606 2,410
Stockholders'
equity 144,401 139,535
------- -------
Total
liabilities and
stockholders'
equity $191,951 $184,617
======== ========
The condensed consolidated balance sheet at
December 31, 2015, has been derived from the
audited consolidated financial statements at
that date included in the Company's Form
10-K for the fiscal year ended December 31,
2015.
(1) Included in short-term
marketable securities as of
September 30, 2016 and December
31, 2015 was $15.0 million and
$18.1 million, respectively, of
corporate equity securities,
representing the Company's
investment in Invitae
Corporation.
GHDX-F
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