On February 25, 2020 Veracyte, Inc., (Nasdaq: VCYT) reported financial results and business progress for the quarter and full year ended December 31, 2019, and provided financial guidance for 2020 (Press release, Veracyte, FEB 25, 2020, View Source [SID1234554738]).
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"Veracyte experienced a transformational year in 2019 as we successfully drove strong revenue and volume growth across our products, secured strategic biopharmaceutical collaborations, advanced our pipeline – specifically, our nasal swab test for early lung cancer detection – and positioned the company to become a global leader in advanced genomic diagnostics on a world-class instrumentation platform," said Bonnie H. Anderson, chairman and chief executive officer of Veracyte. "We also achieved cashflow breakeven status for the fourth quarter of 2019, underscoring our focus on driving business growth, while maintaining financial discipline. We expect 2020 to be a big year for the company as we grow our business, advance our pipeline and leverage the opportunity to expand our global footprint."
Fourth Quarter and Full-Year 2019 Financial Results
For the three months ended December 31, 2019, compared to the prior year:
Total Revenue was $29.7 million, an increase of 15%;
Gross Margin was 66%, unchanged;
Operating Expenses, Excluding Cost of Revenue, were $27.8 million, an increase of 38%;
Net Loss and Comprehensive Loss was ($7.5) million, an increase of 140%;
Basic and Diluted Net Loss Per Common Share was ($0.15), an increase of 88%;
Net Cash Provided by Operating Activities was $1.8 million, compared to $1.2 million used; and
Cash and Cash Equivalents was $159.3 million at December 31, 2019.
For the year ended December 31, 2019, compared to the prior year:
Total Revenue was $120.4 million, an increase of 31%;
Gross Margin was 70%, an increase of six percentage points;
Operating Expenses, Excluding Cost of Revenue, were $99.0 million, an increase of 22%;
Net Loss and Comprehensive Loss was ($12.6) million, an improvement of 45%;
Basic and Diluted Net Loss Per Common Share was ($0.27), an improvement of 56%; and
Net Cash Used in Operating Activities was $3.2 million, an improvement of 76%.
2019 Full-Year and Recent Business Highlights
Commercial Growth:
Achieved strong revenue growth across our testing and product portfolio delivering $29.5 million in the fourth quarter and $108.3 million for 2019, an increase of 16% and 19%, respectively, compared to the prior year.
Accelerated pulmonology testing revenue to $2.0 million and $5.5 million for the fourth quarter and full year, respectively, a 123% and 174% increase compared to prior year.
Grew total genomic volume (Afirma, Percepta and Envisia) by 18% to 10,846 tests in the fourth quarter of 2019 and by 25% to 39,612 tests in 2019, compared to prior year.
Increased genomic volume for our pulmonology products by 136% in 2019 compared to prior year, achieving growth targets for both the Percepta and Envisia classifiers.
Received final Medicare coverage in March 2019 for the Envisia classifier and published strong clinical validation and clinical utility data in The Lancet Respiratory Medicine, propelling nationwide commercial expansion of the test in the second half of 2019.
Expanded payer contracts by 14.4 million lives, making Veracyte an in-network genomic testing provider to health plans representing over 225 million members.
Continued to build an extensive library of clinical data across our portfolio in 2019, including 8 publications and 11 presentations at leading medical meetings, demonstrating our Afirma and pulmonology tests’ performance and clinical utility.
Eleven abstracts were presented at the San Antonio Breast Cancer Symposium in December 2019, including data showing a benefit of Prosigna over other genomic testing to identify patients’ long-term risk of developing distant metastases. In addition, data were presented showing the test’s ability to identify patients with intrinsic breast cancer subtypes that may potentially benefit from CDK4/6 inhibitors in place of standard chemotherapy.
Biopharmaceutical Collaborations/Pipeline Advancement:
In January 2019, announced a long-term strategic collaboration with Johnson & Johnson Innovation LLC to advance the development and commercialization of novel diagnostic tests to detect lung cancer at its earliest stages, when the disease is most treatable.
Presented preliminary data at the American College of Chest Physicians (CHEST) annual meeting for our first-of-its-kind noninvasive nasal swab classifier for improved lung cancer diagnosis. The test, being developed through our Johnson & Johnson collaboration, is expected to launch in early 2021.
Launched the second-generation Percepta GSC, completing the transition of our core classifiers to our RNA whole-transcriptome sequencing platform.
Announced a multi-year collaboration with Acerta Pharma, the hematology research and development arm of AstraZeneca plc, to provide genomic information that will support the biopharmaceutical company’s development of oncology therapeutics in lymphoma.
Global Expansion:
Acquired the exclusive global diagnostic rights to the NanoString nCounter FLEX Analysis System, as well as the Prosigna breast cancer assay and the in-development LymphMark lymphoma subtyping test. We believe this transaction positions us to access a $40 billion global market for our current and pipeline products, by offering a broad menu of advanced genomic tests in oncology and other indications using a distributed-kit model.
2020 Outlook
Veracyte is guiding to full-year 2020 total revenue in the range of $138 million to $142 million and net cash used in operating activities in the range of $8 million to $12 million.
Conference Call and Webcast Details
Veracyte will host a conference call and webcast today at 5:00 p.m. Eastern Time to discuss the company’s financial results and provide a general business update. The conference call will be webcast live from the company’s website and will be available via the following link: View Source The webcast should be accessed 10 minutes prior to the conference call start time. A replay of the webcast will be available for one year following the conclusion of the live broadcast and will be accessible on the company’s website at View Source approximately two hours following the completion of the call.
The conference call can be accessed as follows:
U.S./Canada participant dial-in number (toll-free):
(855) 541-0980
International participant dial-in number:
(970) 315-0440
Conference I.D.:
1184223