MADISON, Wis., May 6, 2020 /PRNewswire/ -- Exact Sciences Corp.
(Nasdaq: EXAS) today announced that the company generated revenue
of $347.8 million for the first
quarter ended Mar. 31, 2020, compared to $162.0 million for the same period of 2019.
"Even in unprecedented times, cancer doesn't stop. The
coronavirus pandemic highlights and increases the need for novel
ways to screen for cancer, detect it early, and guide treatment.
Our Cologuard, Oncotype DX, and Paradigm tests meet that need,"
said Kevin Conroy, chairman and CEO.
"In a world that is trying to avoid unnecessary physician office
visits, invasive procedures, and treatments, our tests and deep
pipeline are more valuable now than ever. We plan to play an even
greater role in cancer screening and guiding therapy decisions
after the coronavirus pandemic abates."
First Quarter 2020 Financial Results
For the three-month period ended March
31, 2020, as compared to the same period of 2019 (where
applicable):
- Total revenue was $347.8 million,
compared to $162.0 million
- Screening revenue was $219.5
million, an increase of 35 percent
- Precision Oncology revenue was $128.4
million
- Gross margin including amortization of acquired intangible
assets was 71 percent, and non-GAAP gross margin excluding
amortization of acquired intangible assets was 77 percent
- Net loss was $105.7 million, or
$0.71 per share, compared to a net
loss of $82.9 million, or
$0.66 per share
- EBITDA was $(51.0) million and
adjusted EBITDA was $(8.2)
million
- Non-cash interest expense related to convertible debt was
$22.5 million, which included a
non-cash loss on extinguishment of debt of $8.0 million, compared to $19.6 million, which included a non-cash loss on
extinguishment of debt of $10.6
million
- Cash, cash equivalents, and marketable securities were
$1.2 billion at the end of the
quarter, including $975.5 million,
net, raised in relation to the issuance of new convertible notes
and the repayment of a portion of previously issued convertible
notes
Screening includes laboratory service revenue from Cologuard and
revenue from Biomatrica products. Precision Oncology includes
laboratory service revenue from global Oncotype DX products and the
recent Paradigm acquisition.
Non-GAAP Disclosure
In addition to the company's financial results determined in
accordance with U.S. GAAP, the company provides non-GAAP measures
that it determines to be useful in evaluating its operating
performance. The company presents EBITDA, adjusted EBITDA, as well
as non-GAAP gross margin and non-GAAP gross profit. EBITDA and
adjusted EBITDA consist of net loss after adjustment for those
items shown in the table below. The company defines non-GAAP gross
profit and non-GAAP gross margin as GAAP gross profit and GAAP
gross margin, respectively, excluding amortization of acquired
intangible assets. The amortization of acquisition-related
intangible assets used in the calculation of non-GAAP gross profit
and non-GAAP gross margin pertain only to the amortization
associated with developed technology acquired and recorded through
purchase accounting transactions. The amortization of these
intangible assets will recur in future periods until such
intangible assets have been fully amortized. The company believes
that these non-GAAP measures are useful in evaluating the company's
operating performance. The company uses this non-GAAP financial
information to evaluate ongoing operations and for internal
planning and forecasting purposes. Non-GAAP financial information,
when taken collectively, may be helpful to investors because it
provides consistency and comparability with past financial
performance. However, non-GAAP financial information is presented
for supplemental information purposes only, has limitations as an
analytical tool and should not be considered in isolation or as a
substitute for financial information presented in accordance with
U.S. GAAP. For example, non-GAAP gross margin and non-GAAP gross
profit exclude the amortization of acquired intangible assets
although such measures include the revenue associated with the
acquisitions. For a reconciliation of these non-GAAP measures to
GAAP, see below "EBITDA and Adjusted EBITDA Reconciliations."
First Quarter Conference Call & Webcast
Company management will host a conference call and webcast on
Wednesday, May 6, 2020, at
5 p.m. ET to discuss first quarter
2020 results. The webcast will be available at
www.exactsciences.com. Domestic callers should dial 833-235-7650
and international callers should dial +1-647-689-4171.
An archive of the webcast will be available at
www.exactsciences.com. A replay of the conference call will be
available by calling 800-585-8367 domestically or 416-621-4642
internationally. The access code for the replay of the call is
7874149. The webcast, conference call and replay are open to all
interested parties.
About Cologuard
Cologuard was approved by the FDA in August 2014, and results
from Exact Sciences' prospective 90-site, point-in-time,
10,000-patient pivotal trial were published in the New England
Journal of Medicine in March 2014. Cologuard is included in
the American Cancer Society's (2018) colorectal cancer screening
guidelines and the recommendations of the U.S. Preventive Services
Task Force (2016) and National Comprehensive Cancer Network (2016).
Cologuard is indicated to screen adults 45 years of age and older
who are at average risk for colorectal cancer by detecting certain
DNA markers and blood in the stool. Do not use Cologuard if you
have had precancer, have inflammatory bowel disease and certain
hereditary syndromes, or have a personal or family history of
colorectal cancer. Cologuard is not a replacement for colonoscopy
in high risk patients. Cologuard performance in adults ages 45-49
is estimated based on a large clinical study of patients 50 and
older. Cologuard performance in repeat testing has not been
evaluated.
The Cologuard test result should be interpreted with caution. A
positive test result does not confirm the presence of cancer.
Patients with a positive test result should be referred for
diagnostic colonoscopy. A negative test result does not confirm the
absence of cancer. Patients with a negative test result should
discuss with their doctor when they need to be tested again.
Medicare and most major insurers cover Cologuard. For more
information about Cologuard, visit www.cologuardtest.com. Rx
only.
About Oncotype DX
The Oncotype DX® portfolio of breast, colon and prostate cancer
tests applies advanced genomic science to reveal the unique biology
of a tumor in order to optimize cancer treatment decisions. In
breast cancer, the Oncotype DX Breast Recurrence Score® test is the
only test that has been shown to predict the likelihood of
chemotherapy benefit as well as recurrence in invasive breast
cancer. Additionally, the Oncotype DX Breast DCIS Score test
predicts the likelihood of recurrence in a pre-invasive form of
breast cancer called DCIS. In prostate cancer, the Oncotype DX
Genomic Prostate Score® test predicts disease aggressiveness and
further clarifies the current and future risk of the cancer prior
to treatment intervention, and the Oncotype DX AR-V7 Nucleus
Detect™ test helps determine which patients with metastatic
castration-resistant prostate cancer (mCRPC) are resistant to
androgen receptor (AR)-targeted therapies. The Oncotype DX AR-V7
Nucleus Detect test is performed by Epic Sciences at its
centralized, CLIA-certified laboratory in San Diego and offered exclusively by Exact
Sciences. With more than 1 million patients tested in more than 90
countries, the Oncotype DX tests have redefined personalized
medicine by making genomics a critical part of cancer diagnosis and
treatment. To learn more about Oncotype DX tests, visit
www.OncotypeIQ.com, www.MyBreastCancerTreatment.org or
www.MyProstateCancerTreatment.org.
About Exact Sciences Corp.
A leading provider of cancer screening and diagnostic tests, Exact
Sciences relentlessly pursues smarter solutions providing the
clarity to take life-changing action, earlier. Building on the
success of Cologuard and Oncotype DX, Exact Sciences is investing
in its product pipeline to take on some of the deadliest cancers
and improve patient care. Exact Sciences unites visionary
collaborators to help advance the fight against cancer. For more
information, please visit the company's website at
www.exactsciences.com, follow Exact Sciences on Twitter
@ExactSciences, or find Exact Sciences on Facebook.
Forward-Looking Statements
This news release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended,
that are intended to be covered by the "safe harbor" created by
those sections. Forward-looking statements, which are based
on certain assumptions and describe our future plans, strategies
and expectations, can generally be identified by the use of
forward-looking terms such as "believe," "expect," "may," "will,"
"should," "would," "could," "seek," "intend," "plan," "goal,"
"project," "estimate," "anticipate" or other comparable
terms. All statements other than statements of historical
facts included in this news release regarding our strategies,
prospects, expectations, financial condition, operations, costs,
plans and objectives are forward-looking statements. Examples of
forward-looking statements include, among others, statements we
make regarding expected future operating results, anticipated
results of our sales, marketing and patient adherence efforts,
expectations concerning payer reimbursement, and the anticipated
results of our product development efforts. Forward-looking
statements are neither historical facts nor assurances of future
performance. Instead, they are based only on our current beliefs,
expectations and assumptions regarding the future of our business,
future plans and strategies, projections, anticipated events and
trends, the economy and other future conditions. Because
forward-looking statements relate to the future, they are subject
to inherent uncertainties, risks and changes in circumstances that
are difficult to predict and many of which are outside of our
control. Actual results, conditions and events may differ
materially from those indicated in the forward-looking statements.
Therefore, you should not rely on any of these forward-looking
statements. Important factors that could cause actual results,
conditions and events to differ materially from those indicated in
the forward-looking statements include, among others, the
following: uncertainties associated with the coronavirus (COVID-19)
pandemic, including its possible effects on our operations and the
demand for our products and services; our ability to efficiently
and flexibly manage our business amid uncertainties related to
COVID-19; our ability to successfully and profitably market our
products and services; the acceptance of our products and services
by patients and healthcare providers; our ability to meet demand
for our products and services; the success of our efforts to
facilitate patient access to Cologuard via telehealth; the
willingness of health insurance companies and other payers to cover
our products and services and adequately reimburse us for such
products and services; the amount and nature of competition for our
products and services; the effects of the adoption, modification or
repeal of any law, rule, order, interpretation or policy relating
to the healthcare system, including without limitation as a result
of any judicial, executive or legislative action; the effects of
changes in pricing, coverage and reimbursement for our products and
services, including without limitation as a result of the
Protecting Access to Medicare Act of 2014; recommendations,
guidelines and quality metrics issued by various organizations such
as the U.S. Preventive Services Task Force, the American Society of
Clinical Oncology, the American Cancer Society, and the National
Committee for Quality Assurance regarding cancer screening or our
products and services; our ability to successfully develop new
products and services and assess potential market opportunities;
our ability to effectively enter into and utilize strategic
partnerships, such as through our Promotion Agreement with Pfizer,
Inc., and acquisitions; our success establishing and maintaining
collaborative, licensing and supplier arrangements; our ability to
maintain regulatory approvals and comply with applicable
regulations; our ability to manage an international business and
our expectations regarding our international expansion and
opportunities; the potential effects of foreign currency exchange
rate fluctuations and our efforts to hedge such effects; the
possibility that the anticipated benefits from our combination with
Genomic Health cannot be realized in full or at all or may take
longer to realize than expected; the possibility that costs or
difficulties related to the integration of Genomic Health's
operations will be greater than expected and the possibility of
disruptions to our business during integration efforts and strain
on management time and resources; the outcome of any litigation,
government investigations, enforcement actions or other legal
proceedings; and the other risks and uncertainties described in the
Risk Factors and in Management's Discussion and Analysis of
Financial Condition and Results of Operations sections of our most
recently filed Annual Report on Form 10-K and our subsequently
filed Quarterly Reports on Form 10-Q. We undertake no obligation to
publicly update any forward-looking statement, whether written or
oral, that may be made from time to time, whether as a result of
new information, future developments or otherwise.
EXACT SCIENCES
CORPORATION
|
Selected Unaudited
Financial Information
|
Condensed
Consolidated Statements of Operations
|
(Amounts in
thousands, except per share data)
|
|
|
Three Months Ended
March 31,
|
|
2020
|
|
2019
|
Revenue
|
$
|
347,821
|
|
|
$
|
162,043
|
|
|
|
|
|
Operating
expenses
|
|
|
|
Cost of sales
(exclusive of amortization of acquired intangible
assets)
|
81,606
|
|
|
42,827
|
|
Research and
development
|
43,509
|
|
|
31,785
|
|
Sales and
marketing
|
167,749
|
|
|
90,939
|
|
General and
administrative
|
113,991
|
|
|
63,806
|
|
Amortization of
acquired intangible assets
|
23,339
|
|
|
760
|
|
Total operating
expenses
|
430,194
|
|
|
230,117
|
|
Loss from
operations
|
(82,373)
|
|
|
(68,074)
|
|
|
|
|
|
Other income
(expense)
|
|
|
|
Investment income,
net
|
97
|
|
|
6,655
|
|
Interest
expense
|
(25,153)
|
|
|
(21,990)
|
|
Total other income
(expense)
|
(25,056)
|
|
|
(15,335)
|
|
|
|
|
|
Net loss before
tax
|
(107,429)
|
|
|
(83,409)
|
|
|
|
|
|
Income tax
benefit
|
1,732
|
|
|
470
|
|
|
|
|
|
Net loss
|
$
|
(105,697)
|
|
|
$
|
(82,939)
|
|
|
|
|
|
Net loss per
share—basic and diluted
|
$
|
(0.71)
|
|
|
$
|
(0.66)
|
|
|
|
|
|
Weighted average
common shares outstanding—basic and diluted
|
148,151
|
|
|
126,248
|
|
EXACT SCIENCES
CORPORATION
|
Selected Unaudited
Financial Information
|
Condensed
Consolidated Balance Sheets
|
(Amounts in
thousands)
|
|
|
March 31,
2020
|
|
December 31,
2019
|
Assets
|
|
|
|
Cash and cash
equivalents
|
$
|
701,054
|
|
|
$
|
177,254
|
|
Marketable
securities
|
530,062
|
|
|
146,401
|
|
Accounts receivable,
net
|
140,046
|
|
|
130,667
|
|
Inventory,
net
|
69,424
|
|
|
61,724
|
|
Prepaid expenses and
other current assets
|
43,732
|
|
|
40,913
|
|
Property, plant and
equipment, net
|
465,476
|
|
|
455,325
|
|
Operating lease
right-of-use assets
|
124,369
|
|
|
126,444
|
|
Goodwill
|
1,237,161
|
|
|
1,203,197
|
|
Intangible assets,
net
|
1,128,261
|
|
|
1,143,550
|
|
Other long-term
assets, net
|
21,540
|
|
|
20,293
|
|
Total
assets
|
$
|
4,461,125
|
|
|
$
|
3,505,768
|
|
|
|
|
|
Liabilities and
stockholders' equity
|
|
|
|
Total current
liabilities
|
$
|
243,581
|
|
|
$
|
236,494
|
|
Convertible notes,
net
|
1,514,306
|
|
|
803,605
|
|
Long-term debt, less
current portion
|
—
|
|
|
24,032
|
|
Other long-term
liabilities
|
47,252
|
|
|
34,911
|
|
Operating lease
liabilities, less current portion
|
118,333
|
|
|
118,665
|
|
Total stockholders'
equity
|
2,537,653
|
|
|
2,288,061
|
|
Total liabilities and
stockholders' equity
|
$
|
4,461,125
|
|
|
$
|
3,505,768
|
|
EXACT SCIENCES
CORPORATION
|
Selected Unaudited
Financial Information
|
EBITDA and
Adjusted EBITDA Reconciliations
|
(Amounts in
thousands)
|
|
|
Three Months Ended
March 31,
|
|
2020
|
|
2019
|
Net loss
|
$
|
(105,697)
|
|
|
$
|
(82,939)
|
|
Interest
expense
|
17,199
|
|
|
11,432
|
|
Investment
income
|
(97)
|
|
|
(6,655)
|
|
Depreciation and
amortization
|
39,345
|
|
|
7,135
|
|
Income tax
benefit
|
(1,732)
|
|
|
(470)
|
|
EBITDA
|
$
|
(50,982)
|
|
|
$
|
(71,497)
|
|
Stock-based
compensation
|
26,742
|
|
|
16,166
|
|
Loss on settlement of
convertible notes
|
7,954
|
|
|
10,558
|
|
Acquisition and
integration costs (1)
|
8,048
|
|
|
—
|
|
Adjusted
EBITDA
|
$
|
(8,238)
|
|
|
$
|
(44,773)
|
|
|
|
|
|
|
|
(1) Represents
acquisition and related integration costs incurred as a result of
the company's combination with Genomic Health. Acquisition and
integration costs were $8.0 million for the three months ended
March 31, 2020. The costs primarily consist of legal and other
professional service fees and incremental stock-based compensation
including the fair value of stock awards assumed by the company in
connection with the Genomic Health combination. Legal, severance,
and other professional service fees were $5.2 million for the three
months ended March 31, 2020. Incremental stock-based compensation
including the fair value of assumed stock awards was $2.8 million
for the three months ended March 31, 2020.
|
EXACT SCIENCES
CORPORATION
|
Selected Unaudited
Financial Information
|
Non-GAAP Gross
Profit and Non-GAAP Gross Margin
|
(Amounts in
thousands)
|
|
|
Three Months Ended
March 31,
|
|
2020
|
|
2019
|
Revenue
|
$
|
347,821
|
|
|
$
|
162,043
|
|
Cost of sales
(exclusive of amortization of acquired intangible
assets)
|
81,606
|
|
|
42,827
|
|
Amortization of
acquired intangible assets (1)
|
20,464
|
|
|
425
|
|
Gross
profit
|
$
|
245,751
|
|
|
$
|
118,791
|
|
Gross
margin
|
71
|
%
|
|
73
|
%
|
|
|
|
|
Amortization of
acquired intangible assets (1)
|
20,464
|
|
|
425
|
|
Non-GAAP gross
profit
|
$
|
266,215
|
|
|
$
|
119,216
|
|
Non-GAAP gross
margin
|
77
|
%
|
|
74
|
%
|
|
|
|
|
|
|
(1) Includes only
amortization of intangible assets identified as developed
technology assets through purchase accounting transactions, which
otherwise would have been allocated to cost of sales.
|
Investor Contact:
Megan Jones
Exact Sciences Corp.
meganjones@exactsciences.com
608-535-8815
Media Contact:
Cara Connelly
Exact Sciences Corp.
cconnelly@exactsciences.com
608-284-5735
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