Genomic Health Announces Second Quarter 2014 Financial Results and Business Progress 17% Increase in Test Volume, 11% Increase in Total Revenue and 29% Increase in International Product Revenue Compared to Prior Year Positive Topline Results from Additional, Large Clinical Validation Study of Oncotype DX® Prostate Cancer Test with Multiple Clinical Endpoints Positive Results from Second, Large Ductal Carcinoma In Situ (DCIS) Clinical Validation Study Submitted for Presentation at the San Antonio Breast Cancer Symposium in December Conference Call Today at 4:30 p.m. ET PR Newswire REDWOOD CITY, Calif., Aug. 7, 2014 REDWOOD CITY, Calif., Aug. 7, 2014 /PRNewswire/ -- Genomic Health, Inc. (Nasdaq: GHDX) today reported financial results and business progress for the quarter ended June 30, 2014. Product revenue was $70.5 million in the second quarter of 2014, compared with $63.7 million for the second quarter of 2013, an increase of 11 percent. There was no contract revenue in either period. International product revenue grew by 29 percent to $11.9 million compared to the same period last year and represented 17 percent of product revenue in the second quarter of 2014. Net loss in the second quarter of 2014 was $4.6 million, compared with a net loss of $3.0 million in the second quarter of 2013. Basic and diluted net loss per share applicable to common stockholders was $0.15 for the second quarter of 2014, compared with a basic and diluted net loss per share of $0.10 for the same period in 2013. "In the second quarter, we delivered 17 percent growth in test volume and double-digit revenue growth by increasing penetration of the U.S. invasive breast cancer market and through continued strong international adoption and reimbursement success," said Kim Popovits, Chairman of the Board, Chief Executive Officer and President of Genomic Health. "Additionally, we delivered strong prostate cancer test growth and announced positive results from an additional large clinical validation study, which we believe will drive reimbursement and further adoption of our test. We look forward to presenting complete results from this study and the landmark DCIS breast cancer study later this year." Additional Second Quarter 2014 and Six Months Ended June 30, 2014 Financial Results Total operating expenses for the second quarter of 2014 were $75.1 million, compared with total operating expenses for the comparable period in 2013 of $66.6 million. Product revenue for the six months ended June 30, 2014 was $137.5 million, compared with $126.4 million for the six months ended June 30, 2013, an increase of 9 percent. Total revenue for the six months ended June 30, 2014 was $137.5 million, compared to $126.8 million for the comparable period in 2013. Net loss was $12.1 million for the six months ended June 30, 2014, compared with a net loss of $3.9 million for the six months ended June 30, 2013. Cash and cash equivalents and short-term investments at June 30, 2014 were $105.7 million, compared with $105.4 million at December 31, 2013. In the second quarter, more than 24,050 Oncotype DX^® test results were delivered, an increase of 17 percent, compared with more than 20,650 test results delivered in the same period in 2013. International test results grew 32 percent during the quarter and represented approximately 20 percent of total test volume in the quarter. "Our first half net loss reflects planned investments in the international and prostate cancer markets," said Brad Cole, Chief Operating Officer and Chief Financial Officer of Genomic Health. "We anticipate planned investments in DCIS, prostate and international markets to continue through the end of the year, resulting in second half net losses similar to the first half." Recent Business Highlights: Oncotype DX Commercial Progress oIn Canada, established Oncotype DX breast cancer test coverage for an additional 3.6 million lives in the province of Alberta, bringing the total lives covered to more than 86 percent of the country's population. oIn Spain, the Agency for Health Technology Assessment of Andalusia (AETSA) published the Evaluation Report of Genomic Platforms, recommending Oncotype DX as the only breast cancer test to support therapeutic decision-making in patients with early-stage, hormone receptor-positive, invasive breast cancer. oIn Mexico, private health insurer AXA granted reimbursement for the Oncotype DX breast cancer test, covering 1.2 million lives. oAnnounced that the Oncotype DX breast cancer test was the first multi-gene test for cancer management to be included in the National Institutes of Health's genetic testing registry. oEstablished Medicaid coverage in three additional states for the Oncotype DX breast cancer test. Pipeline, Presentations and Publications oAnnounced positive preliminary results from an additional independent clinical validation study conducted by the Center for Prostate Disease Research (CPDR), demonstrating that the Oncotype DX Genomic Prostate Score (GPS) predicts multiple clinical endpoints related to disease aggressiveness in men with low- and intermediate-risk prostate cancer. This study validated the Oncotype DX prostate cancer test as a predictor of biochemical recurrence, a rise in prostate-specific antigen (PSA) following surgery, which is a longer-term measure of outcomes for aggressive disease. It also reconfirmed the test's ability to predict adverse pathology from the biopsy, as previously demonstrated in a published validation study performed by the University of California, San Francisco (UCSF). oAnnounced positive preliminary results from a large, independent clinical validation study of Oncotype DX in patients with a pre-invasive form of breast cancer, also known as DCIS (ductal carcinoma in situ). Complete data has been submitted for presentation at the 2014 San Antonio Breast Cancer Symposium. oEuropean Urology published groundbreaking results from three studies demonstrating that the Oncotype DX prostate cancer test predicts aggressiveness at diagnosis and significantly increases the number of low-risk patients who can confidently choose active surveillance. oPresented results from nine abstracts at the American Society of Clinical Oncology^® (ASCO^®) Annual Meeting, including data demonstrating that the Oncotype DX breast cancer test predicts late recurrence five to 15 years out; the unique, practice-changing impact of Oncotype DX to optimize cancer care; and the importance of utilizing multiple biological pathways to predict tumor behavior in prostate and renal cancers. oPresented results of a new analysis suggesting that the Oncotype DX prostate cancer test predicts recurrence risk after prostatectomy, regardless of post-surgery treatment, at the American Urological Association (AUA) Annual Meeting. oReceived acceptance to present one study at the upcoming ASCO Breast Cancer Symposium September 4-6. oReceived acceptance to present two studies at the upcoming American Society of Radiation Oncology^® (ASTRO^®) Meeting September 14-17. oReceived acceptance to present eight studies in multiple tumor types at the upcoming European Society of Medical Oncology^® (ESMO^®) Congress September 26-30. Conference Call Details To access the live conference call today, August 7 at 4:30 p.m. Eastern Time via phone, please dial (877) 303-7208 from the United States and Canada or +1(224) 357-2389 internationally. The conference ID is 66377262. Please dial in approximately ten minutes prior to the start of the call. To access the live and subsequently archived webcast of the conference call, go to the Investor Relations section of the company's website at http://investor.genomichealth.com/events.cfm. Please connect to the web site at least 15 minutes prior to the call to allow for any software download that may be necessary. About Genomic Health Genomic Health, Inc. (NASDAQ: GHDX) is the world's leading provider of genomic-based diagnostic tests that address both the overtreatment and optimal treatment of early stage cancer, one of the greatest issues in healthcare today. The company is applying its world-class scientific and commercial expertise and infrastructure to lead the translation of massive amounts of genomic datainto clinically-actionable results for treatment planning throughout the cancer patient's journey, from screening and surveillance, through diagnosis, treatment selection and monitoring. Genomic Health's lead product, the Oncotype DX® breast cancer test, has been shown to predict the likelihood of chemotherapy benefit as well as recurrence in invasive breast cancer and has been shown to predict the likelihood of recurrence in ductal carcinoma in situ (DCIS). In addition to this widely adopted test, Genomic Health provides the Oncotype DX colon cancer test, the first multi-gene expression test developed for the assessment of risk of recurrence in patients with stage II and stage III disease, and the Oncotype DX prostate cancer test, which predicts disease aggressiveness in men with low risk disease. As of June 30, 2014, more than 19,000 physicians in over 70 countries had ordered more than 465,000 Oncotype DX tests. The company is based in Redwood City, California with European headquarters in Geneva, Switzerland. For more information, please visit, www.GenomicHealth.com and follow the company on Twitter: @GenomicHealth. To learn more about OncotypeDX tests, visit: www.OncotypeDX.com, www.mybreastcancertreatment.org and www.myprostatecancertreatment.org. This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the company's belief that positive study results will drive further reimbursement and adoption of its prostate cancer test; the company's expectations regarding reporting study results; the company's intent to continue its investments in DCIS, prostate cancer and international markets; the company's expectations regarding second half financial results; the attributes and focus of the company's product pipeline; the applicability of clinical study results to actual outcomes; the company's beliefs regarding the benefits and attributes of its tests; the ability of any potential tests the company may develop to optimize cancer treatment; and the ability of the company to develop and commercialize additional tests in the future. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, and reported results should not be considered as an indication of future performance. These risks and uncertainties include, but are not limited to: the risks and uncertainties associated with the regulation of the company's tests; the results of clinical studies and their impact on reimbursement and adoption; the applicability of clinical study results to actual outcomes; the company's ability to develop and commercialize new tests and expand into new markets domestically and internationally; the risk that the company may not obtain or maintain sufficient levels of reimbursement, domestically or abroad, for its existing tests and any future tests it may develop; the risks of competition; unanticipated costs or delays in research and development efforts; the company's ability to obtain capital when needed and the other risks set forth in the company's filings with the Securities and Exchange Commission, including the risks set forth in the company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2014. These forward-looking statements speak only as of the date hereof. Genomic Health disclaims any obligation to update these forward-looking statements. NOTE: The Genomic Health logo, Oncotype, Oncotype DX, Recurrence Score, and DCIS Score are trademarks or registered trademarks of Genomic Health, Inc. All other trademarks and service marks are the property of their respective owners. GENOMIC HEALTH, INC. Condensed Consolidated Statements of Operations (In thousands, except per share amounts) (Unaudited) ThreeMonthsEnded SixMonthsEnded June30, June30, 2014 2013 2014 2013 REVENUES: Product revenues $ 70,477 $ 63,691 $ 137,479 $ 126,400 Contract revenues - - - 385 Total revenues 70,477 63,691 137,479 126,785 OPERATING EXPENSES (1)(2): Cost of product revenues 12,207 10,757 24,262 20,503 Research and development 13,295 13,800 27,976 27,463 Selling and marketing 34,571 28,135 67,303 55,574 General and administrative 15,015 13,910 29,743 27,045 Total operating expenses 75,088 66,602 149,343 130,585 Loss from operations (4,611) (2,911) (11,805) (3,800) Interest income 47 57 97 122 Other income (expense), net 34 (85) (192) (91) Loss before income taxes (4,530) (2,939) (11,900) (3,769) Income tax expense 88 55 163 108 Net loss $ (4,618) $ (2,994) $ (12,063) $ (3,877) Basic and diluted net loss per $ (0.15) $ (0.10) $ (0.39) $ (0.13) share Shares used in computing basic 31,333 30,302 31,211 30,236 and diluted net lossper share Included in operating expenses for the three months ended June 30, 2014 were non-cash charges of $6.1 million, including $4.3 million of stock-based compensation expense and $1.8 million of depreciation and (1) amortization expenses, compared with non-cash charges for the same period in 2013 of $6.1 million, including $4.4 million of stock-based compensation expense and $1.7 million of depreciation and amortization expenses. Included in operating expenses for the six months ended June 30, 2014 were non-cash charges of $12.1 million, including $8.6 million of stock-based (2) compensation expense and $3.5 million of depreciation and amortization expenses, compared with non-cash charges for the same period in 2013 of $11.6 million, including $8.5 million of stock-based compensation expense and $3.1 million of depreciation and amortization expenses. GENOMIC HEALTH, INC. Condensed Consolidated Balance Sheets (In thousands) As of As of December31, June30, 2013 2014 (Unaudited) Cash and cash equivalents $ 32,494 $ 33,279 Short-term marketable securities 73,209 72,071 Accounts receivable, net 31,771 29,446 Prepaid expenses and other current assets 9,014 10,196 Total current assets 146,488 144,992 Property and equipment, net 17,342 18,290 Other assets 14,120 13,752 Total assets $ 177,950 $ 177,034 Accounts payable $ 5,560 $ 5,160 Accrued expenses and other current liabilities 26,581 24,086 Deferred revenues 273 586 Other liabilities 2,083 2,221 Stockholders' equity 143,453 144,981 Total liabilities and stockholders' equity $ 177,950 $ 177,034 The condensed consolidated balance sheet at December 31, 2013 has been derived from the audited consolidated financial statements at that date included in the Company's Form 10-K for the year ended December 31, 2013. Genomic Health, Inc. logo. Logo - http://photos.prnewswire.com/prnh/20130425/SF01493LOGO SOURCE Genomic Health, Inc. Website: http://www.GenomicHealth.com Contact: Investors: Emily Faucette, Genomic Health, 650-569-2824, email@example.com, or Media: Victoria Steiner, Genomic Health, 650-569-2499, firstname.lastname@example.org
Genomic Health Announces Second Quarter 2014 Financial Results and Business Progress
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