NEW YORK (GenomeWeb) – NanoString Technologies reported after the close of the market Wednesday that its first quarter revenues increased 54 percent year over year as its instrument sales doubled.
The Seattle-based molecular diagnostics firm brought in total revenues of $8.8 million for the three months ended March 31, up from $5.7 million in the first quarter of 2013. It beat the average Wall Street estimate of $8.4 million.
Instrument revenue for the quarter was $3.4 million versus $1.7 million for Q1 2013, while consumables sales increased 29 percent to $4.8 million from $3.7 million. NanoString noted that it now has more than 200 of its nCounter systems installed worldwide, and President and CEO Brad Gray said in a statement that growth in the quarter was driven by "new instrument placements into leading centers of cancer research."
During the quarter, NanoString launched its Prosigna Breast Cancer Prognostic Gene Signature Assay services. The assay runs on NanoString's nCounter Dx Analysis System and is based on the PAM50 gene signature. It assesses the gene expression profile of cells found in a woman's breast cancer tissue.
The firm said that it brought in $61,000 in Prosigna kit revenue during the quarter, which Gray said on a conference call following the release of the results was in line with expectations. He reiterated that the firm expects Prosigna sales to be "relatively slow in the first two to three quarters of the year" but ramp gradually as clinical labs begin offering the test.
Gray noted on the call that during the first quarter Laboratory Corporation of America and Arup Laboratories launched Prosigna testing services, and seven more clinical labs, including Quest Diagnostics, are preparing to begin offering the test.
He also noted that the company recently submitted a technology assessment application with Palmetto for the MolDx program. "We continue to be optimistic that we could receive a positive coverage decision by as early as Q3 2014," Gray said.
Gray also said that approximately 40 percent of the firm's nCounter System placements during the quarter were for the Flex configuration, which can run all of the company's research assays but also can be used by "properly qualified" clinical labs to run the Prosigna assay.
"We have found that the Flex system appeals both to clinical laboratories and traditional research customers who take comfort in knowing that the system has been part of an FDA clearance and value the option to begin Prosigna testing as some point in the future," Gray said.
NanoString posted a net loss of $11.4 million, or $.68 per share, for the quarter, compared to a loss of $7.3 million, or $17.88 per share, for Q1 2013, when the firm was still privately held. It beat analysts' consensus estimate of $.76.
The firm's R&D spending in the quarter jumped 52 percent to $4.7 million from $3.1 million, while its SG&A expenses increased 75 percent to $10.7 million from $6.1 million.
NanoString finished the quarter with $29 million in cash and cash equivalents and $56.8 million in short-term investments.
The firm expects full-year 2014 revenues to be between $45 million and $50 million, roughly 43 percent to 59 percent over its FY 2013 revenues of $31.4 million.
NanoString's shares fell 4 percent to $13.68 in Thursday morning trade on the Nasdaq.