REDWOOD CITY, Calif.,
Aug. 1, 2017 /PRNewswire/ -- Genomic
Health, Inc. (NASDAQ: GHDX) today reported financial
results and business progress for the quarter ended June 30, 2017.
Total revenue was $85.5 million in
the second quarter of 2017, compared with $82.0 million in the second quarter of 2016, an
increase of 4 percent, and an increase of 5 percent on a constant
currency basis.i
U.S. product revenue was $72.4
million in the second quarter of 2017, compared with
$69.6 million in the second quarter
of 2016. U.S. invasive breast revenue from Oncotype DX Breast
Recurrence Score® test sales was $65.6 million in the second quarter of 2017,
compared with $64.4 million in the
second quarter of 2016. U.S. prostate revenue from Oncotype
DX® Genomic Prostate Score™ (GPS™) test sales was
$4.1 million in the second quarter of
2017, compared with $2.3 million in
the second quarter of 2016.
International product revenue was $13.1
million in the second quarter of 2017, compared with
$12.3 million in the second quarter
of 2016, an increase of 6 percent, and an increase of 10 percent on
a constant currency basis.i
"In the second quarter, we continued to deliver solid results
reflecting both the strength and differentiation of our clinical
data and unmatched commercial channel, generating a 9 percent
increase in test volume and a 4 percent increase in revenue,"
said Kim Popovits, chairman of the board, chief executive
officer and president of Genomic Health. "Importantly, we
delivered operating leverage and made significant progress toward
our goal of delivering full-year profitability, having improved net
loss by $9 million in the first half
of the year."
More than 31,550 Oncotype™ test results were delivered in the
second quarter of 2017, an increase of 9 percent, compared with
more than 29,060 test results delivered in the same period in 2016.
Oncotype DX Breast Recurrence Score tests delivered in the U.S.
grew 5 percent and Oncotype DX Genomic Prostate Score tests
delivered in the U.S. grew 38 percent compared with the second
quarter of the prior year. International tests delivered grew 12
percent compared with the same period of the prior year and
represented approximately 24 percent of total test volume in the
second quarter of 2017.
Operating loss for the second quarter of 2017 improved to
$3.1 million, compared with
$5.1 million for the second quarter
of 2016. Net loss was $2.7 million,
or 8 cents per share, for the second
quarter of 2017, compared with a net loss of $6.1 million, or 18
cents per share, for the second quarter of 2016. Basic and
diluted net loss per share was $0.08
for the second quarter of 2017, compared with basic and diluted net
loss per share of $0.18 for the
second quarter of 2016.
Total revenue for the six months ended June 30, 2017 was $169.5
million compared with $162.9
million for the six months ended June
30, 2016, an increase of 4 percent. On a constant currency
basis, revenue increased 5 percent compared with the same period in
the prior year.i
International product revenue was $26.5
million for the six months ended June
30, 2017, compared with $22.7
million for the six months ended June
30, 2016, an increase of 16 percent, and an increase of 20
percent on a constant currency basis.i
Operating loss improved to $6.0
million for the six months ended June
30, 2017 compared with an operating loss of $13.9 million for the six months ended
June 30, 2016. Net loss was
$3.5 million for the six months ended
June 30, 2017 compared with a net
loss of $12.5 million for the six
months ended June 30, 2016.
Cash and cash equivalents and short-term marketable securities
at June 30, 2017 were $109.8 million, compared with $87.7 million at December
31, 2016 excluding the fair value of the company's
investment in a marketable security of $9.3
million.
2017 Financial Outlook
The company is providing the following adjusted financial
guidance for the full year ending December
31, 2017:
- Total revenue of between $345 to $355
million (formerly $355 to $370
million); and
- Profit for the full-year at either end of revenue range
(formerly profit at revenue above $362.5
million).
"While the timing of important reimbursement drivers has delayed
the pace of revenue growth, we expect to deliver full-year
profitability at these revised revenue levels, including
double-digit revenue growth in the fourth quarter," said Brad Cole,
chief operating officer and chief financial officer of Genomic
Health. "We expect full-year CMS intermediate prostate coverage and
the implementation of both PAMA reimbursement rates and AJCC
staging criteria, along with increased global market penetration,
to drive strong revenue growth in 2018."
Recent Business Highlights
- Presented new results from a large, community-based,
multi-center clinical validation study conducted at Kaiser
Permanente at the American Urological Association (AUA) 2017 Annual
Meeting. The results confirmed that the Oncotype DX GPS test is a
strong independent predictor of prostate cancer-specific death and
disease progression (metastases) at 10 years in men with localized
prostate cancer.
- Data from two Oncotype DX GPS test analyses based on a
prospective, multi-center, 1,200-patient study were also presented
at AUA, including results that represent the first-ever prospective
validation of a tissue-based molecular marker in prostate cancer.
The second analysis, presented at AUA and published online in
Urology, reinforced that the GPS test significantly
increases use of and persistence on active surveillance.
- Initiated an early access Clinical Utility Program for select
centers around the country in preparation for the commercial launch
of the Oncotype DX AR-V7 Nucleus Detect™ test in collaboration with
Epic Sciences.
- The 15th St. Gallen International Breast Cancer Conference
Expert Panel published updated guidelines endorsing the Oncotype DX
Breast Recurrence Score test for guiding treatment decisions on
adjuvant chemotherapy in both node-negative and node-positive
patients (up to three nodes).
- Breast Cancer Research and Treatment published positive
five-year clinical outcomes results from the PlanB study led by the
West German Study Group (WSG) in 93 centers across Germany. The study showed that women with
Recurrence Score® results of 11 or less who were treated
with hormonal therapy alone had excellent outcomes with 94 percent
disease-free survival rates at five years despite having high-risk
disease by traditional parameters.
- Presented results from eight studies across breast, prostate
and kidney cancers that provide additional evidence of the value of
Oncotype DX tests in predicting clinically meaningful endpoints and
outcomes across cancer types at the 2017 American Society of
Clinical Oncology (ASCO) Annual Meeting in Chicago.
Conference Call Details
To access the live conference call today, August
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 call ID is
47057890. 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 web site at
http://investor.genomichealth.com. Please connect to the web site
at least 15 minutes prior to the presentation 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,
including addressing the overtreatment of the disease, one of the
greatest issues in healthcare today. With its Oncotype
IQ® 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 800,000 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™ test. 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 updated financial
guidance for the full year 2017; 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, and collaborate with third parties to
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 risk
that the company may not achieve its updated 2017 guidance
estimates and the assumptions underlying such guidance; 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 commercial success of any collaborations
entered into by the company; 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 March 31, 2017.
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, Liquid Select, Genomic
Prostate Score, GPS Oncotype DX AR-V7 Nucleus Detect and Oncotype
IQ 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 is a non-GAAP measure that is
calculated by comparing the company's quarterly average foreign
exchange rates for the three and six months ended June 30, 2017. The constant currency
disclosures take current local currency revenue and translate it
into U.S. dollars based upon the foreign currency exchange rates
used to translate the local currency revenue for the applicable
comparable period in the prior year, rather than the actual
exchange rates in effect during the current period. It does not
include any other effect of changes in foreign currency rates on
the company's results or business. The company believes this
non-GAAP financial measure is useful to investors in assessing the
operating performance of the business. This non-GAAP measure should
not be considered in isolation or as an alternative to GAAP
measures.
GENOMIC
HEALTH, INC.
|
Condensed
Consolidated Statements of Operations
|
(In thousands,
except per share amounts)
|
(Unaudited)
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
|
June 30,
|
|
June 30,
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
REVENUES:
|
|
|
|
|
|
|
|
|
|
Product revenues –
United States
|
|
$
|
72,409
|
|
$
|
69,556
|
|
$
|
142,998
|
|
$
|
140,051
|
|
Product revenues –
Outside of the United States
|
|
13,078
|
|
12,330
|
|
26,469
|
|
22,729
|
|
Total product
revenues
|
|
|
85,487
|
|
|
81,886
|
|
|
169,467
|
|
|
162,780
|
|
Contract
revenues
|
|
-
|
|
88
|
|
-
|
|
88
|
|
Total
revenues
|
|
85,487
|
|
81,974
|
|
169,467
|
|
162,868
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES
(1)(2):
|
|
|
|
|
|
|
|
|
|
Cost of product
revenues
|
|
13,798
|
|
15,598
|
|
27,471
|
|
31,752
|
|
Research and
development
|
|
15,781
|
|
14,948
|
|
30,655
|
|
30,557
|
|
Selling and
marketing
|
|
40,656
|
|
37,989
|
|
82,163
|
|
77,489
|
|
General and
administrative
|
|
18,395
|
|
18,537
|
|
35,146
|
|
36,975
|
|
Total operating
expenses
|
|
88,630
|
|
87,072
|
|
175,435
|
|
176,773
|
|
Loss from
operations
|
|
(3,143)
|
|
(5,098)
|
|
(5,968)
|
|
(13,905)
|
|
Interest
income
|
|
206
|
|
87
|
|
364
|
|
165
|
|
Gain on sales of
marketable securities
|
|
-
|
|
676
|
|
2,807
|
|
2,009
|
|
Other income
(expense), net
|
|
357
|
|
(150)
|
|
452
|
|
(63)
|
|
Loss before income
taxes
|
|
(2,580)
|
|
(4,485)
|
|
(2,345)
|
|
(11,794)
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
159
|
|
1,615
|
|
1,200
|
|
657
|
|
Net loss
|
|
$
|
(2,739)
|
|
$
|
(6,100)
|
|
$
|
(3,545)
|
|
$
|
(12,451)
|
|
Basic and diluted net
loss per share
|
|
$
|
(0.08)
|
|
$
|
(0.18)
|
|
$
|
(0.10)
|
|
$
|
(0.38)
|
|
Shares used in
computing basic and diluted net loss per share
|
|
34,428
|
|
33,130
|
|
34,219
|
|
33,015
|
|
|
(1)
|
Included in operating
expenses for the three months ended June 30, 2017, were non-cash
charges of $8.2 million, including $5.2 million of stock-based
compensation expense and $3.0 million of depreciation and
amortization expenses, compared with non-cash charges for the same
period in 2016 of $7.0 million, including $4.8 million of
stock-based compensation expense and $2.2 million of depreciation
and amortization expenses.
|
|
|
(2)
|
Included in operating
expenses for the six months ended June 30, 2017, were non-cash
charges of $15.7 million, including $10.3 million of stock-based
compensation expense and $5.4 million of depreciation and
amortization expenses, compared with non-cash charges for the same
period in 2016 of $13.8 million, including $9.4 million of
stock-based compensation expense and $4.4 million of depreciation
and amortization expenses.
|
GENOMIC
HEALTH, INC.
|
Condensed
Consolidated Balance Sheets
|
(In
thousands)
|
|
|
|
As
of June 30,
2017
|
|
As of
December 31,
2016
|
|
|
|
(Unaudited)
|
|
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
42,200
|
|
$
|
40,404
|
|
Short-term marketable
securities (2)
|
|
67,599
|
|
56,585
|
|
Accounts receivable,
net
|
|
32,427
|
|
35,179
|
|
Prepaid expenses and
other current assets
|
|
12,278
|
|
13,796
|
|
Total current
assets
|
|
154,504
|
|
145,964
|
|
|
|
|
|
|
|
Property and
equipment, net
|
|
48,908
|
|
45,688
|
|
Other
assets
|
|
9,518
|
|
9,462
|
|
Total
assets
|
|
$
|
212,930
|
|
$
|
201,114
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
5,322
|
|
$
|
2,864
|
|
Accrued expenses and
other current liabilities
|
|
33,762
|
|
38,311
|
|
Other
liabilities
|
|
3,899
|
|
3,834
|
|
Stockholders'
equity
|
|
169,947
|
|
156,105
|
|
Total liabilities and
stockholders' equity
|
|
$
|
212,930
|
|
$
|
201,114
|
|
|
|
(1)
|
The condensed
consolidated balance sheet at December 31, 2016, has been derived
from the audited consolidated financial statements at that date
included in the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 2016.
|
|
|
(2)
|
Included in
short-term marketable securities as of December 31, 2016 is $9.3
million of corporate equity securities, representing the Company's
investment in Invitae Corporation. All remaining shares of Invitae
Corporation were sold during the quarter ended March 31,
2017.
|
GHDX-F
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SOURCE Genomic Health, Inc.