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DermTech Q4 Revenues Jump 52 Percent, Miss Wall Street Estimate

NEW YORK — DermTech on Tuesday posted a 52 percent year-over-year increase in fourth quarter revenues as sales of the company's noninvasive skin cancer tests nearly doubled.

For the three-month period ended Dec. 31, 2021, DermTech's revenues came in at $3.2 million, up from $2.1 million a year earlier but falling short of the Wall Street consensus estimate of $3.4 million. Assay revenues in the quarter climbed 87 percent to $3.0 million from $1.6 million, as billable sample volume rose 42 percent to about 11,780 from 8,300 the year before. Contract revenue during the quarter fell 65 percent to $196,000 from $558,000 a year ago.

"In 2021, we substantially scaled our commercial, operations, payor, and development teams," DermTech CEO John Dobak said in a statement. "We look forward to making significant progress in 2022, which will be our first year of commercialization with a fully resourced sales and marketing organization."

DermTech's fourth quarter net loss jumped to $26.1 million, or $.88 per share, from a year-ago loss of $10.7 million, or $.54 per share. Analysts had, on average, been expecting a loss per share of $.73.

Its R&D spending in the quarter surged 216 percent to $6.0 million from $1.9 million in the fourth quarter of 2020, primarily due to higher compensation costs associated with an expanded R&D team, increased clinical trial expenses, increased consulting, software and travel expenses, and greater spending on laboratory supplies to support new product development.

Its SG&A costs, meantime, were up 159 percent at $20.5 million from $7.9 million a year ago on higher payroll-related costs and stock-based compensation.

At the end of 2021, La Jolla, California-based DermTech had cash and cash equivalents totaling $176.9 million and short-term marketable securities of $48.4 million.

For the full-year 2021, DermTech's revenues doubled to $11.8 million from $5.9 million, just missing Wall Street's consensus estimate of $12.1 million. Assay revenues were up 162 percent to $11.0 million from $4.2 million, while billable sample volume rose 86 percent to roughly 44,620 during the year from about 24,000 in 2020. Contract revenue during 2021 dropped to $815,000 from $1.6 million the previous year.

DermTech's net loss for 2021 rose to $78.3 million, or $2.71 per share, from $3.65 million, or $2.15 per share, in 2020. Analysts had, on average, been expecting a loss per share of $2.55.

The company's R&D costs for the year were up over 200 percent at $16.3 million from $5.3 million, while its SG&A expenses rose 109 percent to $62.4 million from $29.9 million in 2020.

Looking ahead, DermTech said that it anticipates Q1 2022 assay revenue will be between $3.4 million and $3.8 million, with full-year assay revenue in the range of $22 million and $26 million.

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