Veracyte Announces Third Quarter 2020 Financial Results
Revenue of
Achieved Key Reimbursement Milestones
Conference Call and Webcast Today at
“We are pleased with the strong rebound in our business during the third quarter, with revenue returning to pre-pandemic levels, led by our Afirma franchise,” said
Third Quarter 2020 Financial Results
For the third quarter of 2020:
-
Total Revenue was
$31.1 million , comprising$30.3 million in testing and product revenue and$0.8 million in biopharmaceutical partnership revenue; - Gross Margin was 67%;
-
Operating Expenses, Excluding Cost of Revenue, were
$24.8 million ; -
Net Loss and Comprehensive Loss was
$4.1 million ; -
Basic and Diluted Net Loss Per Common Share was
$0.08 ; -
Net Cash Provided by Operating Activities was
$1.8 million ; and -
Cash and Cash Equivalents were
$345.1 million atSeptember 30, 2020 .
For the nine-month period ended
-
Total revenue was
$82.9 million , comprising$77.6 million in testing and product revenue and$5.3 million in biopharmaceutical partnership revenue; - Gross Margin was 64%;
-
Operating Expenses, Excluding Cost of Revenue were
$80.0 million ; -
Net Loss and Comprehensive Loss was
$26.9 million ; -
Basic and Diluted Net Loss Per Common Share was
$0.52 ; and -
Net Cash Used in Operating Activities was$12.0 million .
Third Quarter 2020 and Recent Business Highlights
Commercial Growth and Reimbursement Expansion:
- Grew reported genomic testing volume (Afirma, Percepta and Envisia) to 10,242, an increase of 90% over the second quarter of 2020 and 3% over the third quarter of 2019.
-
Generated
$7.0 million in year-to-date 2020 revenue from our Prosigna breast cancer test, achieving our pre-pandemic, full-year 2020 revenue goal. -
Received Advanced Diagnostic Laboratory Test (ADLT) status and new Medicare pricing for the Envisia classifier, beginning
October 1, 2020 , positioning the test for expanded revenue growth. - Received new CPT codes and preliminary national Medicare pricing for the Afirma Medullary Thyroid Carcinoma (MTC) classifier and the Xpression Atlas, providing a pathway for increased reimbursement.
-
Obtained coverage for the Prosigna breast cancer test from the Federal Joint Committee (G-BA) in
Germany , our third largest European market.
- Prosigna:
- Launched the PROCURE study, led by a distinguished, independent scientific committee of breast cancer experts and including input from 180 clinicians throughout
- Data from the TransATAC study were published in the
- Afirma:
- An independent study published in Cytopathology by
- Pulmonology:
- Presented three e-Posters at the
- Published data in the journal CHEST suggesting that the Percepta classifier reduces unnecessary invasive procedures following inconclusive bronchoscopy results for patients with lung nodules and that these results are durable for over one year of follow-up.
- Presented an oral and e-Poster presentation at CHEST Annual Meeting 2020 supporting advancement of our lung cancer nasal swab classifier, along with the potential to integrate radiologic data to further augment genomics in the diagnosis of ILDs, including idiopathic pulmonary fibrosis.
Financing:
-
Issued and sold 6,900,000 shares of common stock in
August 2020 in a registered public offering, including the underwriters’ exercise in full of their option to purchase an additional 900,000 shares, at a price to the public of$30.00 per share. Net proceeds from the offering were approximately$194 million .
2020 Financial Guidance
While
Conference Call and Webcast Details
The conference call can be accessed as follows:
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(855) 541-0980 |
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International participant dial-in number: |
(970) 315-0440 |
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Conference I.D.: |
3190445 |
About
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements, including, but not limited to, our statements related to our plans, objectives, expectations (financial and otherwise) or intentions with respect to our Prosigna, Afirma, Percepta, Envisia, and nasal swab tests and products for use in diagnosing and treating diseases. Forward-looking statements can be identified by words such as: “appears,” "anticipate," "intend," "plan," "expect," "believe," "should," "may," "will" and similar references to future periods. Actual results may differ materially from those projected or suggested in any forward-looking statements. These statements involve risks and uncertainties, which could cause actual results to differ materially from our predictions, and include, but are not limited to: Veracyte’s ability to achieve and maintain Medicare coverage for its tests; the benefits of Veracyte’s tests, the applicability of clinical results to actual outcomes and the effects of the COVID-19 pandemic on Veracyte’s business and performance. Factors that may impact these forward-looking statements can be found in Item 1A – “Risk Factors” in our Annual Report on Form 10-K filed with the
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| (In thousands of dollars, except share and per share amounts) | ||||||||||||||||
|
Three Months Ended |
Nine Months Ended |
|||||||||||||||
|
2020 |
2019 |
2020 |
2019 |
|||||||||||||
| Revenue: | ||||||||||||||||
| Testing revenue |
$ |
28,270 |
|
$ |
26,723 |
|
$ |
70,473 |
|
$ |
78,798 |
|
||||
| Product revenue |
|
2,027 |
|
|
— |
|
|
7,149 |
|
|
— |
|
||||
| Biopharmaceutical revenue |
|
824 |
|
|
2,250 |
|
|
5,325 |
|
|
7,840 |
|
||||
| Collaboration revenue |
|
— |
|
|
2,000 |
|
|
— |
|
|
4,000 |
|
||||
| Total Revenue |
|
31,121 |
|
|
30,973 |
|
|
82,947 |
|
|
90,638 |
|
||||
| Operating expenses: | ||||||||||||||||
| Cost of testing revenue |
|
9,118 |
|
|
9,114 |
|
|
26,157 |
|
|
26,404 |
|
||||
| Cost of product revenue |
|
1,048 |
|
|
— |
|
|
3,539 |
|
|
— |
|
||||
| Cost of biopharmaceutical revenue |
|
204 |
|
|
— |
|
|
572 |
|
|
— |
|
||||
| Research and development |
|
4,042 |
|
|
3,643 |
|
|
12,618 |
|
|
10,408 |
|
||||
| Selling and marketing |
|
10,955 |
|
|
13,088 |
|
|
39,240 |
|
|
39,508 |
|
||||
| General and administrative |
|
8,546 |
|
|
6,624 |
|
|
24,316 |
|
|
20,448 |
|
||||
| Intangible asset amortization |
|
1,274 |
|
|
267 |
|
|
3,822 |
|
|
800 |
|
||||
| Total operating expenses |
|
35,187 |
|
|
32,736 |
|
|
110,264 |
|
|
97,568 |
|
||||
| Loss from operations |
|
(4,066 |
) |
|
(1,763 |
) |
|
(27,317 |
) |
|
(6,930 |
) |
||||
| Interest expense |
|
(55 |
) |
|
(58 |
) |
|
(175 |
) |
|
(596 |
) |
||||
| Other income (loss), net |
|
(3 |
) |
|
1,091 |
|
|
627 |
|
|
2,385 |
|
||||
| Net loss and comprehensive loss |
$ |
(4,124 |
) |
$ |
(730 |
) |
$ |
(26,865 |
) |
$ |
(5,141 |
) |
||||
| Net loss per common share, basic and diluted |
$ |
(0.08 |
) |
$ |
(0.02 |
) |
$ |
(0.52 |
) |
$ |
(0.11 |
) |
||||
| Shares used to compute net loss per common share, basic and diluted |
|
54,858,052 |
|
|
48,588,296 |
|
51,632,750 |
|
45,141,502 |
|||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||
| (In thousands) | ||||||
2020 |
2019 |
|||||
| (Unaudited) | (See Note 1) | |||||
| Assets | ||||||
| Current assets: | ||||||
| Cash and cash equivalents |
$ |
345,080 |
$ |
159,317 |
||
| Accounts receivable |
|
17,629 |
|
19,329 |
||
| Supplies |
|
4,456 |
|
6,806 |
||
| Prepaid expenses and other current assets |
|
3,150 |
|
2,235 |
||
| Total current assets |
|
370,315 |
|
187,687 |
||
| Property and equipment, net |
|
8,914 |
|
8,933 |
||
| Right-of-use assets - operating lease |
|
8,094 |
|
8,808 |
||
| Finite-lived intangible assets, net |
|
61,197 |
|
65,019 |
||
|
|
2,725 |
|
2,725 |
|||
| Restricted cash |
|
603 |
|
603 |
||
| Other assets |
|
2,303 |
|
1,437 |
||
| Total assets |
$ |
454,151 |
$ |
275,212 |
||
| Liabilities and Stockholders’ Equity | ||||||
| Current liabilities: | ||||||
| Accounts payable |
$ |
1,932 |
$ |
2,328 |
||
| Accrued liabilities |
|
10,445 |
|
13,734 |
||
| Current portion of operating lease liability |
|
1,542 |
|
1,407 |
||
| Total current liabilities |
|
13,919 |
|
17,469 |
||
| Long-term debt |
|
756 |
|
694 |
||
| Acquisition-related contingent consideration |
|
6,420 |
|
6,088 |
||
| Operating lease liability, net of current portion |
|
10,331 |
|
11,506 |
||
| Total liabilities |
|
31,426 |
|
35,757 |
||
| Total stockholders’ equity |
|
422,725 |
|
239,455 |
||
| Total liabilities and stockholders’ equity |
$ |
454,151 |
$ |
275,212 |
||
(1) The condensed balance sheet at
| CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS | ||||||||
| (Unaudited) | ||||||||
| (in thousands of dollars) | ||||||||
|
Nine Months Ended |
||||||||
|
2020 |
2019 |
|||||||
| Operating activities | ||||||||
| Net loss |
$ |
(26,865 |
) |
$ |
(5,141 |
) |
||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation and amortization |
|
5,919 |
|
|
2,836 |
|
||
| Gain on disposal of property and equipment |
|
— |
|
|
(23 |
) |
||
| Stock-based compensation |
|
9,354 |
|
|
6,965 |
|
||
| Amortization of debt issuance costs |
|
— |
|
|
83 |
|
||
| Interest on end-of-term debt obligation |
|
162 |
|
|
174 |
|
||
| Write-down of excess supplies |
|
1,088 |
|
|
— |
|
||
| Noncash lease expense |
|
714 |
|
|
810 |
|
||
| Revaluation of acquisition-related contingent consideration |
|
332 |
|
|
— |
|
||
| Effect of foreign currency on operations |
|
(17 |
) |
|
— |
|
||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable |
|
1,742 |
|
|
(10,445 |
) |
||
| Supplies |
|
1,262 |
|
|
(3,206 |
) |
||
| Prepaid expenses and other current assets |
|
(923 |
) |
|
185 |
|
||
| Other assets |
|
134 |
|
|
(142 |
) |
||
| Operating lease liability |
|
(1,040 |
) |
|
(881 |
) |
||
| Accounts payable |
|
(534 |
) |
|
2,505 |
|
||
| Accrued liabilities |
|
(3,300 |
) |
|
1,258 |
|
||
| Net cash used in operating activities |
|
(11,972 |
) |
|
(5,022 |
) |
||
| Investing activities | ||||||||
| Purchases of property and equipment |
|
(1,949 |
) |
|
(1,656 |
) |
||
| Purchase of equity securities |
|
(1,000 |
) |
|
— |
|
||
| Proceeds from disposal of property and equipment |
|
— |
|
|
23 |
|
||
| Net cash used in investing activities |
|
(2,949 |
) |
|
(1,633 |
) |
||
| Financing activities | ||||||||
| Proceeds from the issuance of common stock in a public offering, net |
|
193,831 |
|
|
137,848 |
|
||
| Payment of long-term debt |
|
(100 |
) |
|
(24,900 |
) |
||
| Payment of finance lease liability |
|
— |
|
|
(229 |
) |
||
| Payment of taxes on vested restricted stock units |
|
(3,161 |
) |
|
(810 |
) |
||
| Proceeds from the exercise of common stock options and employee stock purchases |
|
10,114 |
|
|
12,413 |
|
||
| Net cash provided by financing activities |
|
200,684 |
|
|
124,322 |
|
||
| Net increase in cash, cash equivalents and restricted cash |
|
185,763 |
|
|
117,667 |
|
||
| Cash, cash equivalents and restricted cash at beginning of period |
|
159,920 |
|
|
78,598 |
|
||
| Cash, cash equivalents and restricted cash at end of period |
$ |
345,683 |
|
$ |
196,265 |
|
||
| Supplementary cash flow information: | ||||||||
| Purchases of property and equipment included in accounts payable and accrued liability |
$ |
355 |
|
$ |
821 |
|
||
| Interest paid on debt |
$ |
3 |
|
$ |
330 |
|
||
| CASH, CASH EQUIVALENTS AND RESTRICTED CASH | ||||||
| (Unaudited) | ||||||
| (In thousands of dollars) | ||||||
| Cash and cash equivalents |
$ |
345,080 |
$ |
159,317 |
||
| Restricted cash |
|
603 |
|
603 |
||
| Total cash, cash equivalents and restricted cash |
$ |
345,683 |
$ |
159,920 |
||
View source version on businesswire.com: https://www.businesswire.com/news/home/20201102005872/en/
Investor and Media Contact:
Vice President of
650-380-4413
tracy.morris@veracyte.com
Source: