This article has been updated with comments from a conference call following the release of the firm's financial results.
NEW YORK (GenomeWeb) – NeoGenomics reported today a 159 percent increase in its first quarter revenues driven by increases in both base and clinical genetic test volume growth.
For the three-month period ended March 31, the company posted revenues of $59.7 million compared with $23 million a year earlier, topping Wall Street's consensus estimate of $57 million.
Base test volume — which excludes contributions from acquisitions PathLogic and Clarient — climbed 36 percent, while clinical genetic test volume — which excludes tests performed for biopharmaceutical customers and performed by PathLogic — grew 175 percent on the inclusion of Clarient.
During a conference call to discuss the quarterly results, NeoGenomics Chairman and CEO Douglas VanOort noted that revenues from biopharma services were lower than the company had expected, attributing the shortfall to the need to "re-energize" sales efforts. To that end, NeoGenomics brought on four new sales managers in 2016, he said.
NeoGenomics' average revenue per clinical genetic test slipped 6 percent to $390, "but this was driven by our changing test mix and not by declines in average reimbursement," VanOort said. "This test mix change is a result of the addition of Clarient's larger mix of lower revenue immunohistochemistry tests."
The company's first quarter net loss jumped to $5.4 million, or $.07 per share, from $761,000, or $.01 per share, in the same period last year, matching analysts' average expectation. NeoGenomics attributed $5.6 million of the loss to the Clarient acquisition.
NeoGenomics' adjusted net income for the quarter was $2.9 million, or $.03 per share, versus a net loss of $300,000, or $.00 per share, the year before.
SG&A expenses in the first quarter were up 153 percent to $23.8 million from $9.4 million, while R&D costs jumped 116 percent to $1.4 million from $669,000.
Contributing to the R&D costs was the continued evaluation of NeoGenomics' NeoLab Prostate liquid biopsy test. The test is available commercially, but is also being evaluated in a study of more than 2,500 patient samples.
Ahead of the publication of data from that study, NeoGenomics has hired two sales reps and a product manager to "more aggressively market the test," VanOort said. He added that the test is currently billed using a miscellaneous CPT, or current procedural terminology, code and is generally not reimbursed by insurers.
"After we have the results of this latest trial, we will start to work with payors to establish reimbursement for the test," VanOort said.
NeoGenomics finished the first quarter with cash and cash equivalents totaling $19.3 million.
Looking ahead, the company revised its full-year 2016 guidance and now expects revenues for the year to be in the range of $242 million to $252 million, compared with previous guidance of $240 million to $250 million.
Adjusted 2016 EPS is expected to be in the range of $.08 to $.13 a share, compared to previous guidance of between $.07 and $.13 a share.
During midday trading on the Nasdaq, shares of NeoGenomics were up more than 8 percent, climbing $.64 to $8.10.