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Exact Sciences' Q4 Revenues Rise 50 Percent

The story has been updated to include comments from the company's earnings call this morning.

NEW YORK (GenomeWeb) – Exact Sciences today said that its fourth quarter revenues grew 50 percent year over year. 

For the three months ended Dec. 31, 2014, the Madison, Wis.-based molecular diagnostics company reported revenues of $1.5 million, up from $1 million in Q4 2013 and even with the average analysts' estimate. 

All revenues in the recently completed quarter derived from laboratory services, while revenues from the year-ago period derived from license fees. 

On a conference call following the release of Exact Sciences' financial results, President and CEO Kevin Conroy provided details about the adoption of the company's Cologuard colorectal screening test, which received US Food and Drug Administration approval in August and for which the Centers for Medicare and Medicaid Services is reimbursing at $501.

"We are pleased with the launch trajectory of Cologuard during the fourth quarter," he said. "In the short time following FDA approval, and particularly following the Medicare coverage determination, our sales and marketing efforts generated strong interest in Cologuard from both physicians and patients."

By the end of the year more than 4,000 physicians had ordered the test at least once, and more than 40 percent of those physicians had ordered Cologuard at least twice, Conroy said.

To date, Exact Sciences' sales force has reached about 16,000 primary care physicians, or about 6 percent of such doctors in the US, he added. To expand its reach, Exact Sciences is hiring additional sales people, and by next week, its number of sales personnel will increase to 140, compared to 80 at Cologuard's launch. By the end of 2015, that figure will grow to about 200, Conroy said.

He also said that by the end of 2014, about 10,000 physicians were registered with Exact Sciences' laboratory to order Cologuard, and by the middle of this month, an additional 2,000 doctors had registered to order the test.

On the commercial payor front, Conroy said that the company has contracts with between five and 10 payors. The focus is on securing contracts with large national payors and regional payors. Uptake so far has been from regional payors, and getting the large payors on board will take more time, he said, though Exact Sciences is in discussions with a number of them. 

For the quarter, Exact Sciences had a net loss of $32.4 million, or $.38 per share, compared to a net loss of $12.2 million, or $.17 per share, a year ago. The consensus Wall Street estimate was for a loss of $.39 per share. 

Its R&D spending in the quarter was down 25 percent year over year to $5 million during the quarter from $6.7 million a year ago, while its SG&A costs shot up to $25.7 million from $6.6 million. 

Exact Sciences' revenues for full-year 2014 fell to $1.8 million from $4.1 million in 2013, but matched the consensus Wall Street estimate. It recorded $1.5 million in laboratory service revenues and $294,000 in license fees in 2014, while all revenues in 2013 derived from license fees. 

Exact Sciences posted a net loss of $100 million, or $1.25 per share, in 2014, compared to a net loss of $46.5 million, or $.69 per share, in 2013. The average analysts' estimate was for a loss of $1.25 per share. 

Its R&D costs grew 4 percent year over year to $28.7 million from $27.7 million, while its SG&A costs was up nearly three-fold to $69.3 million from $23.2 million. 

Exact Sciences finished 2014 with $58.1 million in cash and cash equivalents. 

Separately, the company said after the close of the market on Monday that the Wisconsin Economic Development Corporation will provide it tax credits of up to $9 million as part of the firm's ongoing growth in the state. Exact Sciences can earn the credits ratably through a combination of hiring 758 new full-time employees and investing $26.3 million in capital expenditures by Dec. 31, 2020. 

In morning trading on Tuesday, shares of Exact Sciences were down about 9 percent on the Nasdaq at $22. 

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