NEW YORK (GenomeWeb News) – MDxHealth reported today that its third quarter revenues increased 78 percent year over year, driven by growth in its prostate cancer molecular diagnostic test, ConfirmMDx.
The company also announced it has launched an equity placement of up to about 3.4 million shares.
The firm reported overall revenues of $3.5 million for the three months ended Sept. 30, up from $2.0 million for Q3 2013.
MDxHealth CEO Jan Groen noted in a statement that ConfirmMDx revenues grew 93 percent year over year to $3.1 million from $1.6 million in the year-ago period as test volume increased to 3,500 tests in Q3 2014 from 2,100 a year ago.
In September, Medicare contractor Palmetto GBA posted a final Medicare Local Coverage Determination for ConfirmMDx, effective Nov. 3, with a reimbursement rate of $2,030. Since ConfirmMDx was launched in May 2012, over 17,000 tests have been ordered by nearly 1,800 urologists, the company said.
MDxHealth posted a net loss of $4.2 million for the recently completed quarter¬, compared to a net loss of $3.9 million in Q3 2013. It finished the quarter with $7.6 million in cash and cash equivalents.
In August, Exact Sciences received approval from the US Food and Drug Administration for its Cologuard colorectal cancer screening test, and last month the Centers for Medicare and Medicaid Services issued a National Coverage Determination for the test with a reimbursement rate of $502. Exact licensed the rights to MDxHealth's DNA methylation biomarkers in 2010 and chose to use MDxHealth's technology for Cologuard in 2011.
MDxHealth said today that it expects to recognize a milestone fee and deferred license fees from Exact for more than $500,000 in the near term as a result of the launch of Cologuard. It added that it is eligible to receive minimum annual maintenance fees of $100,000 per year; sales milestones of $300,000 after Cologuard sales reach at least $10 million; sales milestones of $750,000 after sales of the test reach at least $50 million; and sales milestones of $1 million if Cologuard net sales reach a minimum of $50 million in a single calendar year. MDxHealth also is eligible for running royalties in the mid-single digit range.
Separately, the company launched an offering of up to 3.4 million new shares in a private placement with a group of institutional, qualified, and professional investors. The placement will be structured as an accelerated bookbuilding and commenced immediately with an anticipated close on Nov. 5.
Net proceeds will go toward support and scale-up of MDxHealth's US-based managed care and related healthcare reimbursement efforts, as well as sales and marketing efforts, the company said. Depending on the amount raised, net proceeds may also be used to accelerate product development and for general corporate purposes.
Petercam is the sole lead manager and book runner for the placement.
MDxHealth is a molecular diagnostics company with offices in Herstal, Belgium and Irvine, Calif., and develops epigenetic tests for cancer assessment.