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Myriad Genetics' Q2 Revenues Rise 11 Percent; Profit up 67 Percent

By a GenomeWeb staff reporter

NEW YORK (GenomeWeb News) – Myriad Genetics reported after the close of the market Tuesday that its second-quarter revenues climbed 11 percent due primarily to increased sales and marketing efforts and improved physician acceptance of its products.

The Salt Lake City-based firm brought in total revenues of $92.8 million for the three-month period ended Dec. 31, compared with $84 million for the second quarter of 2009. Analysts, on average, had expected revenues of $91.6 million for Q2 2010.

"Improvements in the overall economy as well as recent company-specific strategic initiatives, allowed us to generate solid year-over-year revenue growth and a return to sequential revenue growth,” Myriad Genetics President and CEO Peter Meldrum said in a statement.

Myriad posted a profit of $35.4 million, or $.36 per share, up 67 percent from net income of $21.2 million, or $.22 per share, for the second quarter of 2009. The firm's EPS beat analysts' consensus estimate of $.34.

The 2009 results include a loss of $15.6 million from discontinued operations related to its former research and pharmaceutical businesses.

Its R&D spending increased 11 percent to $5.1 million from $4.6 million, while its SG&A expenses jumped 20 percent to $42.1 million from $35 million. Myriad said that the increase was primarily due to expanding its sales force to 300 from 250 persons, as well as "support of its direct-to-consumer marketing campaigns in the Mid West and South regions, and expansion of its physicians speakers programs."

"Given the early success of these sales and marketing programs, the increase in our testing volumes over the past quarter and our 9 percent sequential revenue growth, I remain confident that the company will meet or exceed the current First Call consensus revenue of $381 million and earnings per share of $1.47 for fiscal 2010," Meldrum said during the firm's conference call.

Myriad finished the quarter with $457.6 million in cash, cash equivalents, and marketable investment securities. The firm noted that it has no debt and no convertible securities outstanding.

Meldrum added during the call that Myriad remains on track to launch its eighth molecular diagnostic product during the first quarter, as well as the launch of its ninth MDx product in the second half of 2010.

In addition, Meldrum said during the Q&A portion of the call that the firm's defense of its BRCA patents from a lawsuit that was filed by the American Civil Liberties Union and others has not had any negative impact on customers using the test. Oral arguments in that case, which challenges Myriad's rights to the patents, as well as gene patenting in general, were heard yesterday in a New York courtroom.

"If anything, I think the added publicity has had a positive benefit to the company," said Meldrum.

Myriad also announced Tuesday that Greg Critchfield, president of Myriad Genetic Laboratories, a wholly owned subsidiary of Myriad Genetics, will retire from the firm on March 1. He will be replaced by Mark Capone, who currently serves as COO of the lab subsidiary.