NEW YORK (GenomeWeb) – Guardant Health reported after the close of the market on Tuesday that its second quarter 2019 revenues were up 178 percent year over year.
The liquid biopsy firm reported total revenues of $54.0 million for the quarter ended June 30, compared to $19.4 million in the same period of 2018, handily beating the $36.4 million that Wall Street had predicted on average.
Guardant's oncology testing revenue increased 136 percent to $42.1 million from $17.8 million in the prior year's quarter, the firm said. Development services revenue shot up 664 percent to $11.9 million from $1.6 million in Q2 2018, reflecting new projects in companion diagnostic development and regulatory approval services for biopharmaceutical customers.
The company reported 11,875 tests to clinical customers and 5,285 tests to biopharmaceutical customers in the second quarter of 2019, representing increases of 77 percent and 112 percent, respectively, over the same quarter last year.
Among recent milestones, the company highlighted results presented at the American Society of Clinical Oncology Annual Meeting this June demonstrating the ability of its research-use Lunar assay to identify early-stage colorectal cancer patients who may benefit from adjuvant therapy.
Plans to release a CLIA-validated version of the test by the end of this year are still in place, the firm said, as are plans to begin enrolling patients in a prospective colorectal cancer screening study by the fourth quarter.
In a call discussing the firm's earnings, Guardant Health CEO Helmy Eltoukhy said that the embrace of both its Guardant360 and GuardantOmni products "continues to accelerate and outpace our expectations."
"Despite this tremendous growth," he added, "we believe we are still in the early innings of adoption in the advanced cancer market … a roughly $6 billion opportunity." As a result, Guardant estimates that "clinical adoption of Guardant360 is still only in the mid-single digits, with fewer than 15 percent of patients receiving any kind of comprehensive genomic profiling either by tissue or by liquid."
According to Eltoukhy, Guardant continues to believe that a shift to a blood-first paradigm will accelerate adoption of its test, and the first half of 2019 has been a time of "significant headway" in reaching certain proof points that the company believes are critical for achieving this goal.
Progress toward two of these points — FDA approval of Guardant360 with a pan-cancer tumor profiling label, and pan-cancer Medicare coverage — is advancing, Eltoukhy added. "Our team continues to make very good progress in our FDA application … and we believe that a final Medicare pan-cancer LCD could be issued later this year," he said.
Regarding development of its Lunar cancer screening and monitoring assays, Eltoukhy reiterated that Guardant has turned to a "focused strategy" for cancer testing "in spite of the broad applicability of our platform technology in multiple cancer types."
"In selecting colorectal cancer as our initial indication for early detection we considered a number of factors including technical performance cost reimbursement and unmet need," he explained.
As announced in parallel with the firm's first quarter earnings, Guardant plans to begin a prospective colorectal cancer screening study of over 10,000 individuals. Eltoukhy said that this trial, now named "ECLIPSE," is slated to enroll its first patient in Q4 of this year.
"We currently expect the cost directly and indirectly associated with this trial to total between $70 [million] to $100 million, including the build out of a high-throughput laboratory facility to process trial samples," he said.
Importantly, he added, because Guardant believes ECLIPSE will be a critical component of its approval package with the FDA, it is preparing the assay from the start as an in vitro diagnostic product.
Guardant's net loss for the quarter shrank to $11.6 million, or $.13 per share, from $21.6 million, or $1.75 per share, in Q2 2018. Analysts, on average, had predicted a significantly higher loss per share of $.36.
Guardant's R&D expenses were up 68 percent to $19.5 million from $11.6 million in Q2 2018. Its SG&A expenses rose 60 percent to $32.8 million from $20.6 million in the prior-year period.
As of June 30, 2019, the company had $174.7 million in cash and cash equivalents and $371.0 million in short-term marketable securities.
Based on its quarterly results, Guardant Health said it has updated its full-year guidance. The company now expects 2019 revenue to be in the range of $180 million to $190 million, rather than $145 to $150 million, representing 99 percent to 110 percent growth year over year.
In after hours trading on the Nasdaq, Guardant's stock was up 20 percent at $111.