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NanoString Q3 Revenues Jump 27 Percent

This story has been updated to include statements from NanoString officials and stock market information.

NEW YORK (GenomeWeb) - NanoString Technologies today reported a 27 percent increase year over year in its third quarter revenues.

For the three months ended Sept. 30, NanoString's total revenues increased to $15.7 million from $12.3 million in the prior-year period, beating the average Wall Street estimate of $15.4 million.

Instrument revenue decreased 6 percent to $4.3 million, due to fewer sales in the Asia Pacific region, the firm said in a statement. Consumables revenue, excluding its Prosigna breast cancer test, was $8.4 million, up 40 percent year over year. On a conference call following the release of the results, NanoString CEO Brad Gray said consumable growth was strong across all regions and customer segments, especially pharma, where orders increased 60 percent year over year and contributed to over 40 percent of consumables revenue for the quarter.

Prosigna revenues were $662,000, and collaboration revenue increased to $1.8 million from $1.1 million year over year. Gray noted several favorable developments for increased adoption of the breast cancer test.

"In the US, we have continued to make substantial progress with Prosigna," Gray said. On Oct. 1, Medicare began reimbursing in nine states managed by several contractors, including Palmetto. Meridian, which administers Medicare in 13 states including California, published a "favorable" draft local coverage definition policy, he said.

Gray added that Medicare has issued a draft clinical lab fee schedule that sets Prosigna reimbursement at $ 3,416, which was "consistent with our expectations," he said. The success also extended to Europe, as the European Society of Medical Oncology recently recognized Prosigna's use in its clinical practice guidelines.

NanoString said its installed base of nCounter systems increased to 320.

The firm reported a net loss of $9.5 million, or $.49 per share, for the quarter compared to a loss of $12.1 million, or $.61 per share, in Q3 2014, beating the consensus Wall Street estimate of $.50 per share.

NanoString's R&D spending in the quarter decreased just over 3 percent to $5.8 million from $6 million in Q3 2014. Its SG&A costs decreased 4 percent to $12 million from $12.5 million, due to streamlining in its sales and marketing organization, the firm said.

NanoString's finished the quarter with $16.6 million in cash and cash equivalents, and $28.7 million in short-term investments.

The firm reiterated its full-year guidance for revenues between $60 million and $63 million.

In Tuesday morning trade on the Nasdaq, shares of NanoString were down 7 percent at $13.70.