NEW YORK – Castle Biosciences reported after the close of the market on Monday that its first quarter revenues increased 18 percent year over year.
For the three months ended March 31, the Friendswood, Texas-based molecular diagnostics company reported revenues of $26.9 million, up from $22.8 million in Q1 2021 and beating the average Wall Street estimate of $25.2 million.
In Q1, Castle delivered 6,023 DecisionDx-Melanoma test reports, a 48 percent jump from the 4,060 reports delivered in the first quarter of 2021. Castle also issued 456 DecisionDx-UM test reports during the first quarter, up 35 percent from 337 reports in the prior-year quarter, as well as 1,142 DecisionDx-SCC tests, more than twice the 527 tests in the first quarter of 2021. Finally, Castle delivered 950 MyPath Melanoma DecisionDx DiffDx-Melanoma aggregate test reports in Q1, compared to 218 in the same quarter a year ago, and 56 TissueCypher Barrett’s Esophagus test reports.
"We continue to make careful investments intended to further accelerate growth in our core dermatology business as well as in the other pillars of our growth strategy," Castle CEO Derek Maetzold said during a call with investors.
Maetzold said that COVID-19 has continued to impact the diagnosis of cutaneous melanoma, but he highlighted decisions Castle believes have strengthened its resilience and positioned it for growth despite this headwind.
"We doubled our dermatology-facing representatives in 2021 to the mid-60s … so that we would enter 2022 with a commercial team that could take advantage of the promotional responsiveness that we see in this market," he said. Coupled with investments in R&D and new efforts to interface with electronic medical records "should position us well for growth across our suite of dermatologic tests for the remainder of 2022," he added.
Maetzold said the company is also seeing positive reception of its newer TissueCypher Barrett's Esophagus test. The assay was granted advanced diagnostic laboratory test status by CMS during the first quarter, he noted, which will be a boon to future billing.
The firm's net loss for Q1 was $24.6 million, or $.97 per share, compared to a net loss of $4.3 million, or $.17 per share, a year earlier. Wall Street analysts, on average, had estimated a loss per share of $.71 for Q1. Castle used approximately 25.4 million shares to calculate per-share loss in Q1 2022 compared to about 24.9 million shares a year earlier.
Castle's Q1 R&D expenses almost doubled to $10.8 million from $5.9 million in Q1 2021, and its SG&A costs for the quarter rose 68 percent to $30.5 million from $18.2 million the year before.
At the end of March, the company had cash and cash equivalents of $309.0 million.
Castle Biosciences increased its revenue guidance for the year and now anticipates between $118 million and 123 million in revenue for 2022, compared to previous guidance of $115 million to $120 million.