REDWOOD CITY, Calif., Feb. 5 /PRNewswire-FirstCall/ -- Genomic Health, Inc. today reported financial results and business progress for the fourth quarter and year ended December 31, 2007.
Total revenue increased to $19.3 million in the fourth quarter of 2007 compared to $8.6 million in the fourth quarter of 2006. Total revenue for the year ended December 31, 2007 increased to $64.0 million compared to $29.2 million in 2006. Product revenue from Oncotype DX was $19.3 million in the fourth quarter of 2007 compared to $8.1 million in the fourth quarter of 2006. Product revenue was $62.7 million for the year ended December 31, 2007 compared to $27.0 million in 2006. Contract revenue comprised the balance of total revenue for each of these periods.
“Throughout 2007, and particularly in the fourth quarter, we experienced significant growth in product revenue fueled by increasing physician, patient and payor adoption of Oncotype DX,” said Randy Scott, Ph.D., Chairman and Chief Executive Officer of Genomic Health. “We believe that the inclusion of Oncotype DX in both the American Society of Clinical Oncology (ASCO) and the National Comprehensive Cancer Network (NCCN) guidelines signals a change in the treatment paradigm for patients with early-stage breast cancer. Increasingly, physicians and patients are incorporating individualized molecular information into treatment decisions as standard practice.”
Additional Fourth Quarter and Year-End 2007 Financial Results
Cost of product revenue was $4.9 million in the fourth quarter of 2007, compared to $2.7 million for the fourth quarter of 2006. Cost of product revenue for the year ended December 31, 2007 was $17.3 million, compared to $9.9 million in 2006.
Research and development expenses for the fourth quarter of 2007 were $6.0 million, compared to $4.2 million for the same period in 2006. Research and development expenses for the full year 2007 were $22.1 million as compared to $12.8 million in 2006.
Selling and marketing and general and administrative expenses for the fourth quarter of 2007 were $15.2 million, compared to $11.2 million for the same period in 2006. Selling and marketing and general and administrative expenses for the full year 2007 were $54.3 million as compared to $37.4 million in 2006.
Included in fourth quarter 2007 operating expenses was $1.9 million of stock-based compensation expense, compared to $0.9 million of stock-based compensation expense in the same period in 2006. Stock-based compensation expense for the full year was $6.4 million, compared to $3.0 million in 2006.
Net loss was $6.0 million in the fourth quarter of 2007, compared to $9.0 million in the fourth quarter of 2006. Basic and diluted net loss per share applicable to common stockholders was $0.21 in the fourth quarter of 2007, compared to a net loss per share of $0.37 per share in the fourth quarter of 2006.
Net loss for the year ended December 31, 2007 was $27.3 million, compared to $28.9 million in 2006. Basic and diluted net loss per share was $1.02 for the year ended December 31, 2007 compared to a $1.18 net loss per share in 2006.
During the fourth quarter of 2007, approximately 45 percent of product revenue was recorded on an accrual basis and recognized at the time the test results were delivered, primarily reflecting established payment patterns from payors with coverage policies in place. This compares to 31 percent of product revenue recorded on an accrual basis in the third quarter of 2007.
Cash and cash equivalents and investments at December 31, 2007 were $68.4 million, compared to $44.2 million at December 31, 2006 and $73.9 million at September 30, 2007.
2008 Outlook and Financial Guidance
“In 2008, we will continue to seek to broaden the clinical utility of Oncotype DX by investigating ways to appropriately expand its use to help women and their physicians with treatment decisions for breast cancer, including patients with node-positive breast cancer and ductal carcinoma in situ, or DCIS,” said Kim Popovits, President and Chief Operating Officer of Genomic Health. “We expect our net loss to narrow in the coming year, while we continue to invest in our product pipeline and commercial infrastructure.”
The Company is providing the following financial guidance for the full year ending December 31, 2008:
Conference Call Details
To access the live conference call today, February 5 at 4:30 p.m. Eastern Time via phone, please dial (877) 356-8064 from the United States and Canada or (706) 758-4314 internationally. The conference ID is 33305336. Please dial in approximately ten minutes prior to the start of the call. A telephone replay will be available beginning approximately one hour after the call through February 12 and may be accessed by dialing (800) 642-1687 from the United States and Canada or (706) 645-9291 internationally. The replay passcode is 33305336.
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. 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. is a life science company focused on the development and commercialization of genomic-based clinical laboratory services for cancer that allow physicians and patients to make individualized treatment decisions. In 2004, Genomic Health launched its first test service, Oncotype DX(R), which has been shown to predict the likelihood of breast cancer recurrence and the likelihood of chemotherapy benefit in a large portion of early-stage breast cancer patients. The company was founded in 2000 and is located in Redwood City, California. For more information, please visit http://www.genomichealth.com.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to our belief that the inclusion of Oncotype DX in ASCO’s and NCCN’s guidelines signals a change in the treatment paradigm for women with early-stage breast cancer; our belief that the use of Oncotype DX is becoming standard practice in breast cancer treatment planning; our plans to broaden the clinical utility of Oncotype DX to include node-positive breast cancer and ductal carcinoma in situ; the results of studies related to early-stage colon cancer, and our ability to develop a clinical assay for early-stage colon cancer; our ability to identify other genes that may be clinically useful in DCIS; the timing of a validation study for our colon cancer assay; the outcome or success of clinical trials and our expectations regarding potential clinical outcomes; our plans to invest in our product pipeline and our commercial infrastructure; the applicability of clinical study results to actual outcomes; and our 2008 financial guidance, including expectations regarding the number of test results delivered, revenue and net loss. 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: our ability to increase usage of our test; the risk that we may not obtain or maintain sufficient levels of reimbursement for our existing test and any future tests we may develop; the risks and uncertainties associated with the regulation of our tests by FDA; our ability to compete against third parties; our ability to develop and commercialize new tests; unanticipated costs or delays in research and development efforts; our ability to obtain capital when needed; our history of operating losses; the results of clinical studies and the other risks set forth in our filings with the Securities and Exchange Commission, including the risks set forth in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2007. 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 and Recurrence Score are trademarks or registered trademarks of Genomic Health, Inc. All other trademarks and service marks are the property of their respective owners.
The condensed consolidated balance sheet at December 31, 2006 has been derived from the audited consolidated financial statements at that date included in the Company’s Form 10-K for the fiscal year ended December 31, 2006.
CONTACT: Brad Cole, +1-650-569-2281, investors@genomichealth.com, or Emily
Faucette, +1-650-569-2824, media@genomichealth.com, both of Genomic Health,
Inc.
Web site: http://www.genomichealth.com/
