- Full-Year Revenue Increased 120 Percent Compared to 2006 -
- Tests Delivered Grew 69 Percent Compared to 2006 -
- Oncotype DX Included in NCCN, ASCO Guidelines -
- Conference Call Today at 4:30 p.m. ET -
REDWOOD CITY, Calif., Feb. 5 /PRNewswire-FirstCall/ -- Genomic Health, Inc. (Nasdaq: GHDX) today reported financial results and business progress for the fourth quarter and year ended December 31, 2007.
Total revenue increased to $19.3 million in the fourth quarter of 2007 compared to $8.6 million in the fourth quarter of 2006. Total revenue for the year ended December 31, 2007 increased to $64.0 million compared to $29.2 million in 2006. Product revenue from Oncotype DX was $19.3 million in the fourth quarter of 2007 compared to $8.1 million in the fourth quarter of 2006. Product revenue was $62.7 million for the year ended December 31, 2007 compared to $27.0 million in 2006. Contract revenue comprised the balance of total revenue for each of these periods.
"Throughout 2007, and particularly in the fourth quarter, we experienced significant growth in product revenue fueled by increasing physician, patient and payor adoption of Oncotype DX," said Randy Scott, Ph.D., Chairman and Chief Executive Officer of Genomic Health. "We believe that the inclusion of Oncotype DX in both the American Society of Clinical Oncology (ASCO) and the National Comprehensive Cancer Network (NCCN) guidelines signals a change in the treatment paradigm for patients with early-stage breast cancer. Increasingly, physicians and patients are incorporating individualized molecular information into treatment decisions as standard practice."
Additional Fourth Quarter and Year-End 2007 Financrued expenses and other current liabilities 7,616 4,390
Deferred revenue 1,008 847
Notes payable, short-term 2,687 2,547
Notes payable, long-term 2,039 4,726
Other liabilities 1,447 1,162
Stockholders' equity 71,166 41,829
Total liabilities and stockholders' equity $87,929 $58,024
The condensed consolidated balance sheet at December 31, 2006 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, 2006.cial Results
Cost of product revenue was $4.9 million in the fourth quarter of 2007, compared to $2.7 million for the fourth quarter of 2006. Cost of product revenue for the year ended December 31, 2007 was $17.3 million, compared to $9.9 million in 2006.
Research and development expenses for the fourth quarter of 2007 were $6.0 million, compared to $4.2 million for the same period in 2006. Research and development expenses for the full year 2007 were $22.1 million as compared to $12.8 million in 2006.
Selling and marketing and general and administrative expenses for the fourth quarter of 2007 were $15.2 million, compared to $11.2 million for the same period in 2006. Selling and marketing and general and administrative expenses for the full year 2007 were $54.3 million as compared to $37.4 million in 2006.
Included in fourth quarter 2007 operating expenses was $1.9 million of stock-based compensation expense, compared to $0.9 million of stock-based compensation expense in the same period in 2006. Stock-based compensation expense for the full year was $6.4 million, compared to $3.0 million in 2006.
Net loss was $6.0 million in the fourth quarter of 2007, compared to $9.0 million in the fourth quarter of 2006. Basic and diluted net loss per share applicable to common stockholders was $0.21 in the fourth quarter of 2007, compared to a net loss per share of $0.37 per share in the fourth quarter of 2006.
Net loss for the year ended December 31, 2007 was $27.3 million, compared to $28.9 million in 2006. Basic and diluted net loss per share was $1.02 for the year ended December 31, 2007 compared to a $1.18 net loss per share in 2006.
During the fourth quarter of 2007, approximately 45 percent of product revenue was recorded on an accrual basis and recognized at the time the test results were delivered, primarily reflecting established payment patterns from payors with coverage policies in place. This compares to 31 percent of product revenue recorded on an accrual basis in the third quarter of 2007.
Cash and cash equivalents and investments at December 31, 2007 were $68.4 million, compared to $44.2 million at December 31, 2006 and $73.9 million at September 30, 2007.
2008 Outlook and Financial Guidance
"In 2008, we will continue to seek to broaden the clinical utility of Oncotype DX by investigating ways to appropriately expand its use to help women and their physicians with treatment decisions for breast cancer, including patients with node-positive breast cancer and ductal carcinoma in situ, or DCIS," said Kim Popovits, President and Chief Operating Officer of Genomic Health. "We expect our net loss to narrow in the coming year, while we continue to invest in our product pipeline and commercial infrastructure."
The Company is providing the following financial guidance for the full
year ending December 31, 2008:
* Deliver 34,000 to 37,000 test results;
* Revenue of $100 million to $110 million; and
* Net loss of $15 million to $20 million.
Recent Highlights and Accomplishments
Peer-Reviewed Publications and Medical Meeting Presentations
-- In October, ASCO included the use of Oncotype DX in updated
guidelines on the use of breast cancer tumor markers.
-- NCCN, in its 2008 Breast Cancer Treatment Guidelines, included use
of Oncotype DX to set treatment planning. Oncotype DX is the only
multi-gene expression assay to be recommended by NCCN, an alliance
of 21 world-leading cancer centers dedicated to improving the
quality and effectiveness of care provided to patients with cancer.
-- In December, eight studies were presented at the San Antonio Breast
Cancer Symposium (SABCS) reinforcing the clinical utility of
Oncotype DX. The SABCS presentations included a study presented by
the Southwest Oncology Group (SWOG), which reported positive results
for use of Oncotype DX in early-stage estrogen receptor-positive
breast cancer patients with positive nodes. Additionally, three
studies assessing the impact of Oncotype DX on treatment decisions
concluded that use of the test resulted in less recommendation for
and use of chemotherapy, demonstrating the actionable nature of
Oncotype DX in its ability to help reduce unnecessary use of
-- In December, the Agency for Healthcare Research and Quality, the
lead Federal agency charged with improving the quality, safety,
efficiency, and effectiveness of health care, released an online
report reviewing the field of genomic classifiers in breast cancer
including Oncotype DX and other tests. This report, sponsored by CDC
and prepared by the Johns Hopkins Evidence-based Practice Center,
indicates that there is strong evidence that Oncotype DX provides
meaningful information beyond standard measures to predict
recurrence and chemotherapy benefit, with demonstrated clinical
Physician Usage and Adoption
-- More than 7,200 test results were delivered in the fourth quarter of
2007, compared to more than 4,450 test results delivered in the
fourth quarter of 2006.
-- More than 24,450 test results were delivered in 2007 compared to
more than 14,500 in 2006, bringing the cumulative total to more than
46,500 tests since Oncotype DX became commercially available.
Reimbursement Progress for Oncotype DX
-- Health plans covering greater than 70 percent of U.S. insured lives
provide reimbursement for Oncotype DX through contracts, agreements
and policy decisions.
-- Medi-Cal, our first Medicaid payor, established a policy covering
approximately 6 million lives.
-- Excellus Blue Cross Blue Shield, a payor in upstate New York,
established a positive policy covering approximately 2 million
-- Regence Blue Cross Blue Shield, in the Pacific Northwest and
Mountain states, established a positive coverage policy covering
approximately 3 million lives.
-- Blue Cross Blue Shield plans of Florida, Idaho, North Dakota,
Louisiana and Mississippi established policies covering
approximately 7.5 million lives.
-- Great-West Healthcare, recently acquired by CIGNA, initiated a
positive policy covering approximately 2.6 million lives.
-- Results of two studies presented at the ASCO Gastrointestinal
Cancers Symposium in January 2008 identified genes that could help
predict the likelihood of recurrence of early-stage colon cancer.
Genomic Health is conducting detailed analyses of these studies to
select a refined gene set for the development of a clinical assay to
quantify the risk of recurrence and likelihood of chemotherapy
benefit for patients with early-stage colon cancer, which we expect
will be validated in an independent study later this year.
-- Established an agreement with Pfizer to apply the same molecular
technology and clinical strategy used to develop Oncotype DX to
develop a genomic test to estimate the risk of recurrence following
surgery for patients with Stage I-III renal carcinoma, clear cell
type, which affects an estimated 25,000 people each year in the
-- Beginning February 1, 2008, included single gene reporting for
estrogen and progesterone receptor gene expression in all Oncotype
-- Announced plans to investigate the utility of Oncotype DX in
patients with ductal carcinoma in situ (DCIS), a pre-invasive form
of breast cancer that affects approximately 60,000 women per year in
the United States. Genomic Health plans to evaluate the use of the
Oncotype DX 21-gene panel and also seek to identify other genes that
may be used for treatment planning in DCIS.
Conference Call Details
To access the live conference call today, February 5 at 4:30 p.m. Eastern Time via phone, please dial (877) 356-8064 from the United States and Canada or (706) 758-4314 internationally. The conference ID is 33305336. Please dial in approximately ten minutes prior to the start of the call. A telephone replay will be available beginning approximately one hour after the call through February 12 and may be accessed by dialing (800) 642-1687 from the United States and Canada or (706) 645-9291 internationally. The replay passcode is 33305336.
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. 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 a life science company focused on the development and commercialization of genomic-based clinical laboratory services for cancer that allow physicians and patients to make individualized treatment decisions. In 2004, Genomic Health launched its first test service, Oncotype DX(R), which has been shown to predict the likelihood of breast cancer recurrence and the likelihood of chemotherapy benefit in a large portion of early-stage breast cancer patients. The company was founded in 2000 and is located in Redwood City, California. For more information, please visit http://www.genomichealth.com.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to our belief that the inclusion of Oncotype DX in ASCO's and NCCN's guidelines signals a change in the treatment paradigm for women with early-stage breast cancer; our belief that the use of Oncotype DX is becoming standard practice in breast cancer treatment planning; our plans to broaden the clinical utility of Oncotype DX to include node-positive breast cancer and ductal carcinoma in situ; the results of studies related to early-stage colon cancer, and our ability to develop a clinical assay for early-stage colon cancer; our ability to identify other genes that may be clinically useful in DCIS; the timing of a validation study for our colon cancer assay; the outcome or success of clinical trials and our expectations regarding potential clinical outcomes; our plans to invest in our product pipeline and our commercial infrastructure; the applicability of clinical study results to actual outcomes; and our 2008 financial guidance, including expectations regarding the number of test results delivered, revenue and net loss. 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: our ability to increase usage of our test; the risk that we may not obtain or maintain sufficient levels of reimbursement for our existing test and any future tests we may develop; the risks and uncertainties associated with the regulation of our tests by FDA; our ability to compete against third parties; our ability to develop and commercialize new tests; unanticipated costs or delays in research and development efforts; our ability to obtain capital when needed; our history of operating losses; the results of clinical studies and the other risks set forth in our filings with the Securities and Exchange Commission, including the risks set forth in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2007. 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 and Recurrence
Score are trademarks or registered trademarks of Genomic Health, Inc. All
other trademarks and service marks are the property of their respective
(Financial statements below)
Genomic Health, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except share and per share data)
For the Three Months For the Year Ended
Ended December 31, December 31,
2007 2006 2007 2006
(Unaudited) (Unaudited) (Audited)
Product revenues $19,264 $8,074 $62,745 $27,006
Contract revenues 84 542 1,282 2,168
Total revenues 19,348 8,616 64,027 29,174
Cost of product revenues 4,915 2,707 17,331 9,908
development 6,015 4,162 22,053 12,841
Selling and marketing 10,079 7,295 36,456 24,625
administrative 5,087 3,861 17,849 12,765
expenses 26,096 18,025 93,689 60,139
Loss from operations (6,748) (9,409) (29,662) (30,965)
Other income (expense):
Interest and other income 900 548 3,048 2,491
Interest expense (143) (134) (678) (446)
Net loss ($5,991) ($8,995) ($27,292) ($28,920)
Basic and diluted net
loss per share ($0.21) ($0.37) ($1.02) ($1.18)
Shares used to
compute basic and
diluted net loss
per share 28,162,249 24,537,122 26,759,798 24,508,845
Genomic Health, Inc.
Condensed Consolidated Balance Sheets
As of As of
Cash and cash equivalents $39,164 $14,926
Short-term investments 29,196 29,289
Accounts receivable, net 4,989 1,862
Prepaid expenses and other current assets 3,205 1,609
Total current assets 76,554 47,686
Property and equipment, net 10,412 9,421
Restricted cash 500 500
Other assets 463 417
Total assets $87,929 $58,024
Accounts payable $1,966 $2,523
|SOURCE Genomic Health, Inc.|
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