NEW YORK – CareDx reported after the close of the market on Tuesday that its second quarter revenues rose 33 percent year over year, thanks largely to a 41 percent increase in testing services revenues.
For the three months ended June 30, the molecular diagnostics company reported total revenues of $41.8 million, up from $31.5 million during the same period a year earlier, beating the average Wall Street estimate of $35.6 million.
Testing services revenues rose to $36.3 million from $25.7 million in the prior-year quarter, while product revenues fell 28 percent to $3.3 million from $4.6 million. Digital and other revenues rose to $2.2 million from $1.2 million in Q2 2019.
"Throughout this challenging time, our team at CareDx successfully executed across our initiatives and never wavered from our commitment to improving the lives of transplant patients," CareDx Chairman and CEO Peter Maag said in a statement. "Our performance in the second quarter, highlighted by strong growth and robust results from RemoTraC, is a testament to our patient focus and dedication. As we look to the second half of this year, while uncertainty continues, what remains clear is the dedication of our team, our ability to navigate through this time and our confidence to be able to continue to deliver durable long-term operational growth."
CareDx also said it returned more than 17,100 results from its AlloSure blood-based, donor-derived, cell-free DNA test for organ transplant rejection and AlloMap heart transplant test to patients in Q2, a 44 percent year-over-year increase. More than 40 percent of the results originated from the RemoTraC and mobile phlebotomy service the firm launched in early April to provide blood draws of routine transplant tests at home, CareDx said.
On a conference call with analysts following the release of the earnings, Maag noted that around 150 transplant centers are offering RemoTraC to their patients, and that more than 4,000 kidney, heart, and lung transplant patients have enrolled in the program to date.
He also said the company has chosen to "invest strategically" during the pandemic in areas that will help it to develop its capabilities in transplant care, including direct-to-patient capabilities, multimodal testing, and digital solutions.
But despite an increase in testing revenues, Maag said that CareDx's product revenues have been negatively affected by the pandemic.
"Hospitals and transplant laboratories across the US and Europe have restricted access to their facility for outside personnel," he said. "In May, we received the CE mark for AlloSeq Tx 17, our best-in-class solution for HLA matching of transplant donors and recipients. Despite providing better care for patients by extending the typing range through non-classical HLA loci, our launch efforts will be late in the US and Europe due to the COVID pandemic."
Maag also noted that CareDx recorded its first ever revenues from AlloCell in the second quarter. In April, the company announced that it would begin a biopharma research partnership for AlloCell, which it described as a surveillance solution for patients who have received engineered-cell transplants for allogeneic cell therapy.
"While we are in the proof-of-concept phase, we have fielded many inquiries from pharmaceutical and biotech companies of all sizes," Maag said. "We are very excited about the opportunities in cell therapy and we will continue to update you on our progress."
The firm's Q2 net loss narrowed to $6.6 million, or $.15 per share, from $7.8 million, or $.19 per share, in Q2 2019. On an adjusted basis, the company reported earnings of $.04 per share for the quarter, beating analysts' consensus expectation for a loss of $.04 per share.
CareDx's Q2 R&D costs rose 72 percent to $13.1 million from $7.6 million in the year-ago quarter, and its SG&A expenses rose 28 percent to $24.4 million from $19.1 million.
The company ended the quarter with $211.4 million in cash and cash equivalents. The company also reported receiving $4.8 million from the CARES Act Provider Relief Fund during the quarter.
CareDx said that while it experienced improved trends in the second quarter, it won't be providing guidance because of the continued uncertainties with respect to the COVID-19 pandemic.
The company's shares rose nearly 3 percent to $34.40 in after-hours trading on the Nasdaq.