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Quidel Q4 Revenues Shrink 7 Percent on Softer Flu Business; MDx Projects Remain on Track

NEW YORK (GenomeWeb News) – Quidel reported after the close of the market on Tuesday that its fourth quarter revenues declined 7 percent year over year on slower influenza and respiratory disease business.

The San Diego-based diagnostics company saw its revenues during the three months ended Dec. 31, 2013 retreat to $50.2 million from $53.9 million in the year-ago period, but still beat the consensus analyst estimate of $48.7 million.

In a statement, Quidel said that the revenue drop resulted from a "more normalized influenza and respiratory disease season in 2013," compared to an earlier and more severe season a year ago.

On the firm's conference call following the release of its financial results, Quidel President and CEO Douglas Bryant provided an update on its molecular diagnostics business. Of its AmpliVue hand-held MDx instrument he said that "we expect 2014 to be a big year" for assays being developed for the instrument.

Since launching its AmpliVue assay for C. difficile last year, Quidel has inked a "number of key larger volume customers, and [the firm] should begin to see a meaningful uptick in our test order run rate beginning in Q2 as a result," Bryant said.

The firm received 510(k) clearance from the US Food and Drug Administration for the AmpliVue Group B Strep Assay in December, and it anticipates the product to generate "some incremental benefit" in 2014.

Quidel also submitted its 510(k) package to the FDA for its HSV 1/2 assay in late December and it anticipates receiving clearance for the product in the second quarter.

The firm initiated clinical trials this week for its Group A Streptococcus assay running on the AmpliVue platform, and will initiate clinical trials this week also for pertussis and parapertussis. Further, Quidel has "several other assays in development," including one for trichomonas and one for chlamydia/gonorrhea, Bryant added.

"If all goes well, we could have five or six AmpliVue assays either in market or with the FDA by the end of the year," he said.

Lastly, he said the Savanna integrated cartridge-based platform remains on schedule. The platform will perform both real-time PCR assays and helicase-dependent amplification assays developed by BioHelix, which Quidel acquired last May.

As the firm moves toward the conclusion of the development stage of the instrument, it has begun in parallel the cartridge manufacturing phase. Goals for the coming year include installing the cartridge manufacturing line at Quidel's Athens, Ohio facility, rolling out Savanna at a US trade show, and delivering the first integrated system to Africa for field evaluation trials, Bryant said.

For Q4 2013, the company's net income was down to $1.1 million, or $.03 per share, compared to a profit of $8.7 million, or $.26 per share, a year ago. On an adjusted basis, EPS was $.20. Wall Street had estimated EPS at $.09, on average.

The company increased its R&D spending 55 percent to $11.3 million from $7.3 million, and its SG&A spending 26 percent to $16.6 million from $13.2 million. During Q4 2013, Quidel took a facility restructuring charge of $1.3 million.

For full-year 2013, the company's revenues increased 13 percent to $175.4 million from $155.7 million, beating the consensus Wall Street estimate of $174.0 million.

Quidel's profit rose to $7.4 million, or $.21 per share, compared to $5.0 million, or $.15 per share, in 2012. Adjusted EPS was $.61 versus a consensus estimate of $.27.

Its R&D costs rose 23 percent year over year to $34.2 million from $27.7 million, and its SG&A spending increased 18 percent to $60.0 million from $51.0 million.

It exited 2013 with $9.4 million in cash, cash equivalents, and restricted cash.