NEW YORK (GenomeWeb News) – Response Genetics today said that its revenues in the third quarter dropped 24 percent year over year as both pharmaceutical client and ResponseDX revenues fell.
The firm's total revenues for the third quarter came in at $4.1 million, down from $5.4 million a year ago. Pharma client revenues decreased 35 percent year over year, the Los Angeles-based molecular diagnostics shop said, adding that ResponseDX revenues were down 16 percent.
The drop in pharma client revenues resulted from one-time $500,000 milestone payments that Response received in the year-ago period, while the decline in ResponseDX revenues resulted from a refocusing of its sales efforts on larger potential accounts, the company said.
In the third quarter, Response started marketing its technical component/professional component testing service, in which Response performs the technical component of the testing process, while the pathologist performs the professional component.
"Prior to having this service, the company believes it was difficult to focus its efforts on larger potential accounts," the company said. "The addition of its TC/PC testing service, the expansion of the company’s testing menu, and other initiatives in process, are expected to add significant volume and stability to the sales base which historically was comprised of primarily small accounts."
Response's net loss for the third quarter increased to $2.7 million, or $.08 per share, from a net loss of $1.4 million, or $.05 per share, a year ago.
It lowered its R&D spending 8 percent to $391,592 from $426,105, it said, while it maintained its SG&A spending at $3.7 million.
The company exited the quarter with $4.6 million in cash and cash equivalents.
"The results for the third quarter of 2013 were clearly disappointing," Response Chairman and CEO Thomas Bologna said in a statement. "Although we anticipate inconsistency in our pharma revenues, the decrease in ResponseDX sales volume was unexpected."
"We are very pleased that we have begun to close the larger [diagnostic] accounts that we began pursuing in the third quarter and we expect to deliver meaningful top-line [diagnostic] growth in the coming quarters," he said.