This article has been updated from a previous version to include comments made by Veracyte executives during the company's earnings call.
NEW YORK – Genomic testing firm Veracyte reported after the close of the market Tuesday that its third quarter 2019 revenues grew 32 percent year over year.
For the three months ended Sept. 30, the South San Francisco, California-based firm reported total revenues of $31.0 million, compared to $23.5 million in Q3 2018, beating analysts' average estimate of $30.1 million.
According to Veracyte, total revenue included $4.3 million in biopharmaceutical revenue. Anderson noted that the revenue stems from achievements with the J&J Lung Cancer Initiative, as well as the firm's continued collaboration with Loxo Oncology.
Veracyte said its Q3 genomic testing volume grew to 9,941 tests, an increase of 24 percent over Q3 2018. The firm also expanded its Envisia Genomic Classifier volume to 223 tests, a quarterly growth of 72 percent. In addition, Veracyte said its Afirma test volume has grown to 8,925 tests, an increase of 17 percent from 7,606 in Q3 2018.
Veracyte narrowed its net loss to $730,000, or $.02 per share, from a loss of $4.5 million, or $.12 per share, in the year-ago quarter. The firm beat Wall Street's consensus estimate for a loss per share of $.07.
Veracyte's R&D expenses totaled $3.6 million in Q3 2019, up about 6 percent from $3.4 million in Q3 2018. The firm's SG&A's expenses jumped 25 percent to $19.7 million from $15.8 million.
Veracyte noted that it recently presented several studies at the American College of Chest Physicians annual meeting (CHEST 2019) demonstrating the ability of its Envisia classifier to help physicians distinguish idiopathic pulmonary fibrosis from other interstitial lung diseases when used with high-resolution CT imaging; and the clinical validity and utility of its Percepta classifier in lung cancer diagnosis when bronchoscopy findings are inconclusive.
In a conference call with investors Tuesday afternoon, Veracyte CEO and Chairman Bonnie Anderson elaborated on another CHEST 2019 prospective study using its newly developed nasal swab test for lung cancer patient guidance after CT imaging, noting that it showed higher sensitivity for low-risk patients and higher specificity for high-risk patients.
"We are particularly excited by the new, preliminary data for our noninvasive nasal swab test for early lung cancer detection, which we believe has significant potential to improve care among the millions of patients with suspicious lung nodules detected each year," Anderson said in a statement.
In addition to developing the nasal swab classifer, Veracyte announced that it has partnered with National Jewish Health to explore opportunities to improve diagnosis of idiopathic pulmonary fibrosis and other interstitial lung diseases (ILD). The group will combine diagnostic imaging data from National Jewish Health with whole transcriptome RNA sequencing genomic data from Veracyte's repository of ILD patient samples.
"Our goal is to determine if these expansive and complementary datasets, when informed by our deep machine learning expertise, can enhance diagnosis across the care continuum for ILD patients," Anderson explained.
The company ended the quarter with $195.7 million in cash and cash equivalents.
Veracyte reaffirmed its 2019 annual revenue guidance of $119 million to $122 million. In the conference call, Veracyte CFO Keith Kennedy elaborated that in Q4 the company anticipates receiving $4 million in payments from Johnson & Johnson related to milestones achieved in the second and third quarter in connection with a collaboration around an optimized version of the Percepta brocnhial classifier.
In Wednesday morning trading on the Nasdaq, shares of Veracyte were up about 1 percent at $26.38.