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Adaptive Biotechnologies Q1 Revenues up 84 Percent, Beat Analyst Estimates

NEW YORK – Adaptive Biotechnologies reported an 84 percent year-over-year increase in first quarter revenues after the close of the market on Wednesday.

For the quarter ended March 31, Adaptive reported $38.4 million in revenues, up from $20.9 million during the year-ago period and beating the consensus Wall Street estimate of $27.8 million.

Sequencing revenues were $15.2 million, up 60 percent from $9.5 million in Q1 2020, and development revenues were $23.3 million, a 103 percent increase from $11.4 million in the prior year's first quarter, primarily driven by increased biopharmaceutical services, including $7 million associated with regulatory milestones achieve by pharma customers and a $4.7 million increase in revenue generated from the firm's drug development agreement with Genentech.

The company said it increased sales of ClonoSeq, its assay for minimal residual disease monitoring in blood cancers, by about 35 percent, from 3,518 tests in Q1 2020, to 4,757 tests in the recently ended quarter.

Research sequencing volume increased by 17 percent to 7,026 sequences delivered from 6,030 sequences delivered in the same period last year.

During a call discussing the firm's quarterly results, CEO and cofounder Chad Robins said that although the $7 million Adaptive earned from pharma milestone payments for trials using its ClonoSeq MRD assay had already been included in its full-year guidance, "it's great to see these materializing and accelerating."

He also highlighted the firm's recent addition of a new collaboration with Pfizer, using the ClonoSeq test to measure minimal residual disease as a clinical endpoint in clinical trials for a Pfizer drug.

Adaptive President Julie Rubinstein added that ClonoSeq is currently being used in all 31 National Comprehensive Cancer Network-designated cancer centers and has been used to treat more than 16,700 patients.

"With eight months having passed since our FDA clearance in CLL, 17 of these NCCN centers are now using ClonoSeq for their CLL patients," Rubinstein said. "In addition, we continued to drive expansion of payer coverage policies for CLL in Q1, reaching about 125 million covered lives," she added.

On the immune diagnostics development front, Robins said he views Adaptive's receipt this March of an Emergency Use Authorization from the US Food and Drug Administration for its T cell-based COVID-19 test, T-Detect COVID, as a significant strategic milestone.

According to Robins, the achievement "de-risks" the future success of the larger T-Detect platform, which the firm is also developing for immune-based Lyme disease and gastrointestinal disease testing.

Adaptive's net loss for the quarter totaled $40.6 million, or $.29 per share, compared to a loss of $31.4 million, or $.25 per share, in Q1 2020. Wall Street analysts, on average, had predicted a significantly higher loss of $.41 per share.

The weighted average number of shares used in computing net loss per share was 139 million in the recently completed quarter compared to 126.1 million a year ago.

The company's quarterly R&D expenses during Q2 rose about 41 percent to $33.8 million from $23.9 million a year ago, reflecting higher personnel, materials, and laboratory costs. Its SG&A expenses totaled $35.5 million, up about 38 percent from $25.8 million in Q1 2020. According to the firm, marketing efforts related to the FDA EUA and early-access launch of its T-Detect COVID assay was a major driver of this increase.

As of March 31, Adaptive had $173.6 million in cash and cash equivalents, and $540.6 million in short-term marketable securities.

The company said it expects its full-year 2021 revenue to be in the range of $145 million to $155 million.