NEW YORK (GenomeWeb News) – Transgenomic reported after the close of the market on Wednesday that revenues in the second quarter increased 18 percent year over year.
Total revenues for the three months ended June 30 increased to $9.1 million from $7.7 million a year ago as the firm's Laboratory Services segment rose 41 percent year over year and Diagnostic Tools improved 17 percent, Transgenomic CEO Craig Tuttle said in a statement. He added that the company has solved problems related to its laboratory information system that led to a reduction in sample processing capacity at the company's New Haven, Conn., lab testing facility, resulting in a 4 percent dip in first-quarter revenues year over year.
"Further, with the improvements made to our LIMS, we are well positioned for the continued growth in volumes that we expect in our Clinical Laboratories division," following the launch of Transgenomic's clopidogrel genetic absorption activation panel, or C-GAAP test, for predicting a patient's response to the anti-platelet drug, Tuttle said.
On a conference call following the release of its earnings results, Chad Richards, Transgenomic's chief commercial officer, said that in the second quarter Diagnostic Tools posted $3.3 million in revenues. Growth in the business was driven by the company's partnership with A Menarini Diagnostics, continued success with its Hanabi chromosome harvesters, and a strong sales quarter in Asia for its Wave systems.
Clinical Laboratories, meanwhile, brought in $5.5 million in revenues in the second quarter, resulting from the resolution of the LIMS problems and sales growth in the Familion and neurology segments, Richards said. Tuttle added that the Familion product line had 10 percent "natural growth" in the quarter, and $600,000 in revenues stemming from the Q1 backlog.
The Pharmacogenomics service business was down 65 percent in the quarter year over year to $300,000, Richards said. In Q2 2011, Transgenomic received $800,000 for the completion of a Phase III trial.
Last week, Transgenomic announced Medicare would cover the C-GAAP test. On the conference call Tuttle said that more than 6 million prescriptions are currently written each year for the drug, and with recent approvals by the US Food and Drug Administration for "multiple generic versions" of the drug, which goes under the brand name Plavix, "we expect prescriptions to grow significantly and for our C-GAAP test to be ordered more routinely. We believe the C-GAAP test represents a potential multi-billion dollar market opportunity for our Clinical Laboratories division."
The firm's net loss for the quarter was sliced to $563,000, or $.01 per share, from a net loss of $6.0 million, or $.13 per share, a year ago. On the conference call, Tuttle said the improvement resulted from and adjustment of $4.2 million in preferred stock expense in 2011 and $1 million from gains on common stock warrants.
The company increased its R&D spending 13 percent during the quarter to $654,000 from $579,000 a year ago, but pulled back on SG&A spending 5 percent to $5.3 million from $5.6 million.
Transgenomic ended the quarter with $6.3 million in cash and cash equivalents, and $9.0 million in short-term investments.
In early Thursday trade on the OTC Bulletin Board, shares of Transgenomic dipped 2 percent to $1.03.