Net Revenue Grew 7% Over the Prior Year
Comparable Quarter and 11% Over the First Quarter of 2017 Raised
Over $22 Million in Capital in Past 6 MonthsEliminated All Long
Term Debt and Related Royalties and MilestonesCash on Hand in
Excess of $14 MillionStockholders’ Equity Grew to in Excess of $36
Million at June 30, 2017ThyGenX® Now Covered by CIGNA
Interpace Diagnostics Group, Inc. (NASDAQ:IDXG) (“Interpace” or
“the Company”), a fully integrated commercial company that provides
clinically useful molecular diagnostic tests and pathology services
for improved patient diagnosis and management, today announced
financial results and business progress for the second quarter
ended June 30, 2017 and year to date, as well as recent
accomplishments.
“The second quarter and year to date in 2017 was certainly
transformative for Interpace. We continued to improve our balance
sheet in the second quarter by raising an additional $13.7 million
of capital, eliminating all long term debt and related possible
royalties and milestone obligations while continuing to make good
commercial progress,” said Jack Stover, Interpace’s President &
CEO. “Our cash position is now in excess of $14 million and
we increased our stockholders’ equity by over $29 million since
year-end. We are now well positioned to leverage our commercial
resources and further build out our platforms,” noted Stover.
“Additionally, continuing to make reimbursement progress, such as
getting coverage for our ThyGenX assay with CIGNA, one of the
largest healthcare insurers in the US, further demonstrates the
importance of our diagnostic tests to the marketplace,” added Mr.
Stover.
Q2 and Year to Date 2017 Financial
Performance
- Net Revenue for the three-month period ended June 30, 2017 and
for the six-month period was $3.9 million and $7.3 million, an
increase of 7% over the same prior year period and 11% over the
first quarter of 2017.
- Year to date Total Operating Expenses were $3.6 million, a
reduction of $6.7 million from the prior year due to a Change in
Fair Value of Contingent Consideration related to conversion of our
then outstanding long term debt to equity and termination of future
related royalties and milestone obligations.
- Total Operating Expenses for the 2017 second quarter increased
to $5.6 million, an increase of $.9 million compared to the same
quarter of 2016 due principally to increased General &
Administrative costs in 2017 as we began to strategically rebuild
our operations from the deep cost reductions required in 2016 as
well as professional fees related to multiple equity offerings and
debt/equity exchanges that we successfully closed during the first
half of 2017.
- Year to date the Loss from Continuing Operations for the six
months ended June 30, 2017 was $4.4 million compared to $7.5
million for the six months ended June 30, 2016. Included in the
Loss from Continuing Operations in the 2017 second quarter is a
$2.7 million Loss on Extinguishment of Debt and $4.3 million year
to date in 2017. Also included in the 2017 year to date Loss from
Continuing Operations is a $5.8 million benefit due to a Change in
Fair Value of Contingent Consideration.
- Loss from Continuing Operations for the quarter ended June 30,
2017 was $6.3 million as compared to $3.5 million for the second
quarter of 2016.
- Total Assets year to date grew by approximately $12 million
while at the same time total liabilities were reduced by over $17
million, a 51% improvement since year-end.
- Cash balances year to date improved to over $14 million at the
end of the 2017 second quarter.
- Net Cash Used in Operations year to date 2017 was $8.6 million
as compared to $5.3 million for the comparable period of 2016.
Included in Net Cash Used in Operations year to date 2017 is over
$3 million of expenditures related to discontinued operations,
transaction fees and the remainder of payment obligation carried
over from the CSO business we sold in 2015.
- Net Cash Used in Operations for the second quarter of 2017
amounted to $4.4 million as compared to $1.3 million for the same
quarter in 2016. Included in Net Cash Used in Operations in the
second quarter of 2017 was approximately $0.7 million of
expenditures related to discontinued operations, transaction fees
and the remainder of payment obligations carried over from the
contract sales organization (CSO).
- Total stockholders’ equity grew by over $29 million to $36.3
million since year-end 2016.
Adjusted EBITDA (in the attached schedule), which we believe is
a meaningful supplemental disclosure that may be indicative of how
management and our Board of Directors evaluate Company performance,
adjusts Income or Loss from Continuing Operations for non-cash
charges such as depreciation & amortization, asset impairment,
loss on extinguishment, and the change in fair value of contingent
consideration. Accordingly, our Adjusted EBITDA for the six months
ended June 30, 2017 and 2016 was $(3.6) million and $(4.2) million
respectively due primarily to the reduction in Loss from Continuing
Operations. Adjusted EBITDA for the three-month periods ended
June 30, 2017 and 2016 was $(2.5) million and $(1.7) million,
respectively.
Second Quarter 2017 and Recent Business
Highlights
- In April 2017 announced that UnitedHealthcare, the largest
health plan in the United States, has agreed to cover Interpace’s
ThyraMIR test for all of United’s members nationwide.
Interpace’s ThyGenX and ThyraMIR thyroid assays are now covered for
approximately 275 million patients nationwide.
- In April 2017 we also announced a laboratory services agreement
with Cedar Sinai Medical Center of Los Angeles for our two thyroid
assays.
- In May 2017 six abstracts related to PancraGEN were accepted
and presented as posters at the Digestive Disease Week (DDW)
meeting being held May 6th-9th, 2017 in Chicago, Illinois.
- In June 2017 we announced national contract approval with AETNA
for our thyroid assays. AETNA is the third largest health plan in
the US with over 44 million members.
- In May we announced that Anthem, the second largest health plan
in the US and the largest Blue Cross Blue Shield plan in the
country agreed to cover ThyraMIR for its 75 million members.
- In June 2017 we entered into an agreement with a major
Healthcare system in Philadelphia for our two molecular tests for
indeterminate thyroid nodules, ThyGenX and ThyraMIR.
- In June 2017 we also announced coverage by LifeWise, a regional
plan in Washington State and Premea Blue Cross to cover
ThyraMIR.
- In July 2017 we announced that CIGNA, one of the largest
national health plans in the US, agreed to cover our ThyGenX test
for CIGNA’s 15 million members nationwide.
- In July 2017 we also announced formal launch of the TERT marker
of aggressiveness in our thyroid test at the World Congress of
Thyroid Cancer.
About Interpace Diagnostics Group,
Inc.
Interpace is a fully integrated commercial company that
provides clinically useful molecular diagnostic tests and pathology
services for evaluating risk of cancer by leveraging the latest
technology in personalized medicine for better patient diagnosis
and management. The Company currently has three commercialized
molecular tests; PancraGEN® for the diagnosis and prognosis of
pancreatic cancer from pancreatic cysts; ThyGenX®, for the
diagnosis of thyroid cancer from thyroid nodules utilizing a next
generation sequencing assay and ThyraMIR®, for the diagnosis of
thyroid cancer from thyroid nodules utilizing a proprietary gene
expression assay. Interpace’s mission is to provide
personalized medicine through molecular diagnostics and innovation
to advance patient care based on rigorous science. For more
information, please visit Interpace’s website at
www.interpacediagnostics.com
About Thyroid Nodules, ThyGenX and ThyraMIR
testing
According to the American Thyroid Association,
approximately 15% to 30% of the 525,000 thyroid fine needle
aspirations (FNAs) performed on an annual basis in the U.S. are
indeterminate for malignancy based on standard cytological
evaluation, and thus are candidates for ThyGenX and ThyraMIR.
ThyGenX and ThyraMIR reflex testing yields high predictive value
in determining the presence and absence of cancer in thyroid
nodules. The combination of both tests can improve risk
stratification and surgical decision-making when standard
cytopathology does not provide a clear diagnosis for the presence
of cancer.
ThyGenX utilizes state-of-the-art next-generation sequencing
(NGS) to identify more than 100 genetic alterations associated with
papillary and follicular thyroid carcinomas, the two most common
forms of thyroid cancer. ThyraMIR is the first microRNA gene
expression classifier. MicroRNAs are small, non-coding RNAs
that bind to messenger RNA and regulate expression of genes
involved in human cancers, including every subtype of thyroid
cancer. ThyraMIR measures the expression of 10 microRNAs.
Both ThyGenX and ThyraMIR are covered by both Medicare and
Commercial insurers.
About Pancreatic Cysts and PancraGEN
PancraGEN is a pancreatic cyst molecular test that, by using a
small sample of pancreatic cyst fluid, can aid in pancreatic cancer
risk assessment. PancraGEN is 90% accurate, according to clinical
studies, enabling effective risk stratification of patients.
Pancreatic cancer is often difficult to diagnose in early stages
and typically spreads rapidly with signs and symptoms appearing
when the cancer is significantly advanced. Because of this, and
that complete surgical removal of the pancreas is not possible,
pancreatic cancer is considered a leading cause of cancer
deaths.
Forward Looking Statements
This press release contains forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, Section 21E of the Securities Exchange Act of 1934 and the
Private Securities Litigation Reform Act of 1995, relating to our
future financial and operating performance. The company has
attempted to identify forward looking statements by terminology
including "believes," "estimates," "anticipates," "expects,"
"plans," "projects," "intends," "potential," "may," "could,"
"might," "will," "should," "approximately" or other words that
convey uncertainty of future events or outcomes to identify these
forward-looking statements. These statements are based on
current expectations, assumptions and uncertainties involving
judgments about, among other things, future economic, competitive
and market conditions and future business decisions, all of which
are difficult or impossible to predict accurately and many of which
are beyond the Company’s control. These statements also involve
known and unknown risks, uncertainties and other factors that may
cause the Company’s actual results to be materially different from
those expressed or implied by any forward-looking statement. Known
and unknown risks, uncertainties and other factors include, but are
not limited to, our ability to adequately finance the business, our
ability to restructure our liabilities and other obligations, the
market's acceptance of our molecular diagnostic tests; our ability
to retain or secure reimbursement, our ability to secure additional
business and generate higher profit margins through sales of our
molecular diagnostic tests, in-licensing or other means,
projections of future revenues, growth, gross profit and
anticipated internal rate of return on investments and our ability
to maintain our NASDAQ listing. Additionally, all forward-looking
statements are subject to the risk factors detailed from time to
time in the Company’s periodic filings with the Securities and
Exchange Commission (SEC), including without limitation, the Annual
Report on Form 10-K filed with the SEC on March 31, 2017 and the
amendment on Form 10-K/A filed on April 28, 2017, the Company’s
Quarterly Report on Form 10-Q for the quarter ended March 31, 2017
filed with the SEC on May 12, 2017, and the Company’s Registration
Statement on Form S-1, as amended (333-218140) initially filed with
the SEC on May 22, 2017. Because of these and other risks,
uncertainties and assumptions, undue reliance should not be placed
on these forward-looking statements. In addition, these statements
speak only as of the date of this press release and, except as may
be required by law, the Company undertakes no obligation to revise
or update publicly any forward-looking statements for any
reason.
Non-GAAP Financial Measures
In addition to the United States generally
accepted accounting principles, or GAAP, results provided
throughout this document, Interpace has provided certain non-GAAP
financial measures to help evaluate the results of its performance.
We believe that these non-GAAP financial measures, when presented
in conjunction with comparable GAAP financial measures, are useful
to both management and investors in analyzing the Company’s ongoing
business and operating performance. We believe that providing the
non-GAAP information to investors, in addition to the GAAP
presentation, allows investors to view the Company’s financial
results in the way that management views financial results.
In this document, we discuss Adjusted EBITDA, a
non-GAAP financial measure. Adjusted EBITDA is a metric used by
management to measure cash flow of the ongoing business. Adjusted
EBITDA is defined as income or loss from continuing operations,
plus depreciation and amortization, non cash stock based
compensation, interest and taxes, and other non-cash expenses
including asset impairment costs, loss on extinguishment of debt,
goodwill impairment and change in fair value of contingent
consideration. The table below includes a reconciliation of this
non-GAAP financial measure to the most directly comparable GAAP
financial measure.
Conference Call
As previously announced, Interpace will hold a
conference call Thursday August 10, 2017 at 4:30 p.m. (ET) to
discuss financial and operational results for the second quarter
and year to date ended June 30, 2017. Details as follows:
The live webcast and subsequent replay may be
accessed by visiting Interpace’s website
www.interpacediagnostics.com. Alternatively, please call
1-800-334-0872 (U.S.) or 1-719-457-2615 (international). The
conference ID number is 5840893. The webcast replay will be
available on the company’s website approximately two hours
following completion of the call and archived on the company’s
website for 90 days.
|
|
|
|
|
|
|
|
|
|
|
|
|
Interpace Diagnostics Group,
Inc. |
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
(unaudited, in thousands, except per share
data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Six Months Ended |
|
|
|
June 30, |
|
|
June 30, |
|
|
|
|
2017 |
|
|
|
|
2016 |
|
|
|
|
2017 |
|
|
|
|
2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue, net |
|
|
$ |
3,855 |
|
|
|
$ |
3,612 |
|
|
|
$ |
7,325 |
|
|
|
$ |
6,647 |
|
Cost of revenue |
|
|
|
1,879 |
|
|
|
|
1,842 |
|
|
|
|
3,651 |
|
|
|
|
3,020 |
|
Gross
profit |
|
|
|
1,976 |
|
|
|
|
1,770 |
|
|
|
|
3,674 |
|
|
|
|
3,627 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Sales and
marketing |
|
|
|
1,555 |
|
|
|
|
1,322 |
|
|
|
|
2,691 |
|
|
|
|
2,904 |
|
Research
and development |
|
|
|
413 |
|
|
|
|
357 |
|
|
|
|
719 |
|
|
|
|
680 |
|
General
and administrative |
|
|
|
2,793 |
|
|
|
|
2,015 |
|
|
|
|
4,315 |
|
|
|
|
4,797 |
|
Acquisition related amortization expense |
|
|
|
813 |
|
|
|
|
970 |
|
|
|
|
1,626 |
|
|
|
|
1,939 |
|
Change in
fair value of contingent consideration |
|
|
|
- |
|
|
|
|
- |
|
|
|
|
(5,776 |
) |
|
|
|
- |
|
Total
operating expenses |
|
|
|
5,574 |
|
|
|
|
4,664 |
|
|
|
|
3,575 |
|
|
|
|
10,320 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
(loss) income |
|
|
|
(3,598 |
) |
|
|
|
(2,894 |
) |
|
|
|
99 |
|
|
|
|
(6,693 |
) |
Interest expense |
|
|
|
(216 |
) |
|
|
|
(858 |
) |
|
|
|
(469 |
) |
|
|
|
(1,062 |
) |
Loss on extinguishment
of debt |
|
|
|
(2,731 |
) |
|
|
|
- |
|
|
|
|
(4,278 |
) |
|
|
|
- |
|
Other (loss) income ,
net |
|
|
|
(8 |
) |
|
|
|
3 |
|
|
|
|
(44 |
) |
|
|
|
10 |
|
Loss from
continuing operations before tax |
|
|
|
(6,553 |
) |
|
|
|
(3,749 |
) |
|
|
|
(4,692 |
) |
|
|
|
(7,745 |
) |
Benefit from income
taxes |
|
|
|
(301 |
) |
|
|
|
(236 |
) |
|
|
|
(298 |
) |
|
|
|
(227 |
) |
Loss from
continuing operations |
|
|
|
(6,252 |
) |
|
|
|
(3,513 |
) |
|
|
|
(4,394 |
) |
|
|
|
(7,518 |
) |
(Loss)
income from discontinued operations, net of tax |
|
|
|
(54 |
) |
|
|
|
1,179 |
|
|
|
|
502 |
|
|
|
|
398 |
|
Net
loss |
|
|
$ |
(6,306 |
) |
|
|
$ |
(2,334 |
) |
|
|
$ |
(3,892 |
) |
|
|
$ |
(7,120 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic (loss) income per
share of common stock: |
|
|
|
|
|
|
|
|
|
|
|
|
From
continuing operations |
|
|
$ |
(0.65 |
) |
|
|
$ |
(1.93 |
) |
|
|
$ |
(0.64 |
) |
|
|
$ |
(4.19 |
) |
From
discontinued operations |
|
|
|
(0.01 |
) |
|
|
|
0.65 |
|
|
|
|
0.07 |
|
|
|
|
0.22 |
|
Net
(loss) income per basic share of common stock |
|
|
$ |
(0.65 |
) |
|
|
$ |
(1.29 |
) |
|
|
$ |
(0.57 |
) |
|
|
$ |
(3.96 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted (loss) income
per share of common stock: |
|
|
|
|
|
|
|
|
|
|
|
|
From
continuing operations |
|
|
$ |
(0.65 |
) |
|
|
$ |
(1.93 |
) |
|
|
$ |
(0.64 |
) |
|
|
$ |
(4.19 |
) |
From
discontinued operations |
|
|
|
(0.01 |
) |
|
|
|
0.65 |
|
|
|
|
0.07 |
|
|
|
|
0.22 |
|
Net
(loss) income per diluted share of common stock |
|
|
$ |
(0.65 |
) |
|
|
$ |
(1.29 |
) |
|
|
$ |
(0.57 |
) |
|
|
$ |
(3.96 |
) |
Weighted average number of common shares and |
|
|
|
|
|
|
|
|
|
|
|
|
common
share equivalents outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
9,657 |
|
|
|
|
1,816 |
|
|
|
|
6,877 |
|
|
|
|
1,796 |
|
Diluted |
|
|
|
9,657 |
|
|
|
|
1,816 |
|
|
|
|
6,877 |
|
|
|
|
1,796 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Balance Sheet Data |
|
|
|
|
|
|
($ in thousands) unaudited |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30 |
|
|
December
31, |
|
|
|
|
|
|
|
|
|
|
2017 |
|
|
|
|
2016 |
|
|
|
|
|
|
|
Cash and cash
equivalents |
|
|
$ |
14,265 |
|
|
|
$ |
602 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current
assets |
|
|
|
18,337 |
|
|
|
|
4,240 |
|
|
|
|
|
|
|
Total current
liabilities |
|
|
|
10,855 |
|
|
|
|
16,241 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
|
|
53,744 |
|
|
|
|
41,778 |
|
|
|
|
|
|
|
Total liabilities |
|
|
|
17,402 |
|
|
|
|
35,247 |
|
|
|
|
|
|
|
Total stockholders'
equity |
|
|
|
36,342 |
|
|
|
|
6,531 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Cash Flow Data |
|
|
|
|
|
|
($ in thousands) unaudited |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months Ended |
|
|
|
|
|
|
|
|
|
June 30, |
|
|
|
|
|
|
|
|
|
|
2017 |
|
|
|
|
2016 |
|
|
|
|
|
|
|
Net loss |
|
|
$ |
(3,892 |
) |
|
|
$ |
(7,120 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in
operations |
|
|
$ |
(8,572 |
) |
|
|
$ |
(5,271 |
) |
|
|
|
|
|
|
Net cash used in
investing activities |
|
|
|
- |
|
|
|
|
- |
|
|
|
|
|
|
|
Net cash provided by
financing activities |
|
|
|
22,235 |
|
|
|
|
- |
|
|
|
|
|
|
|
Change in cash and cash
equivalents |
|
|
|
13,663 |
|
|
|
|
(5,271 |
) |
|
|
|
|
|
|
Cash and equivalents,
Beginning |
|
|
|
602 |
|
|
|
|
8,310 |
|
|
|
|
|
|
|
Cash and equivalents,
Ending |
|
|
$ |
14,265 |
|
|
|
$ |
3,039 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Adjusted EBITDA
(Unaudited) |
($ in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
Six Months Ended |
|
|
|
June 30, |
|
|
|
June 30, |
|
|
|
|
2017 |
|
|
|
|
|
2016 |
|
|
|
|
|
2017 |
|
|
|
|
|
2016 |
|
Loss from continuing
operations |
|
|
$ |
(6,252 |
) |
|
|
|
$ |
(3,513 |
) |
|
|
|
$ |
(4,394 |
) |
|
|
|
$ |
(7,518 |
) |
Depreciation and
amortization- continuing operations |
|
|
|
965 |
|
|
|
|
|
1,133 |
|
|
|
|
|
1,937 |
|
|
|
|
|
2,390 |
|
Stock-based
compensation - continuing operations |
|
|
|
148 |
|
|
|
|
|
21 |
|
|
|
|
|
206 |
|
|
|
|
|
88 |
|
Taxes |
|
|
|
(301 |
) |
|
|
|
|
(236 |
) |
|
|
|
|
(298 |
) |
|
|
|
|
(227 |
) |
Interest expense |
|
|
|
216 |
|
|
|
|
|
858 |
|
|
|
|
|
469 |
|
|
|
|
|
1,062 |
|
Loss on extinguishment
of debt |
|
|
|
2,731 |
|
|
|
|
|
- |
|
|
|
|
|
4,278 |
|
|
|
|
|
- |
|
Change in fair value of
contingent consideration |
|
|
|
- |
|
|
|
|
|
- |
|
|
|
|
|
(5,776 |
) |
|
|
|
|
- |
|
Adjusted EBITDA |
|
|
$ |
(2,493 |
) |
|
|
|
$ |
(1,737 |
) |
|
|
|
$ |
(3,578 |
) |
|
|
|
$ |
(4,205 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONTACTS:
Interpace Diagnostics
Investor Relations:
Paul Kuntz
Redchip
Paul@Redchip.com
Interpace Biosciences (NASDAQ:IDXG)
Historical Stock Chart
From Apr 2024 to May 2024
Interpace Biosciences (NASDAQ:IDXG)
Historical Stock Chart
From May 2023 to May 2024