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CareDx Reports Lift in Preliminary Q1 Revenues, Gets Nasdaq Notice of Non-Compliance

NEW YORK (GenomeWeb) – CareDx reported after the close of the market on Monday that its preliminary first quarter revenues would be in the range of $11.4 million to $11.6 million, up 73 percent to 76 percent, respectively, from $6.6 million in Q1 2016.

Also on Monday, the firm received a notification letter from Nasdaq stating that it is out of compliance with a rule requiring timely filing of periodic reports with the US Securities and Exchange Commission. The firm received the notice because it had not filed its Form 10-Q for Q1 in the required time.

In reporting preliminary financial results, CareDx said that revenues for its AlloMap gene expression test for identifying heart transplant recipients would be between $7.7 million and $7.9 million in the quarter, and US volumes for the test would rise 12 percent year-over-year.

CareDx noted that Olerup, a product designed to increase the chance of successful transplants by facilitating a better match between a donor and a recipient of stem cells and organs, would contribute $3.7 million in the first quarter.

CareDx President and CEO Peter Maag said in a statement that "strong AlloMap volume and revenue growth in the quarter underscores the build out in our core business." He noted that the firm continues "to anticipate CMS coverage this year, and with this milestone achieved, we are well on track to make AlloSure available to kidney transplant patients later in 2017."

The firm said it recently received a draft local coverage determination from Palmetto GBA for AlloSure, a non-invasive test that uses donor-derived, cell-free DNA to measure allograft injury and identify the probability of active rejection.

CareDx said that its net loss would narrow in Q1 to between $5.8 million and $6.8 million, or a loss of between $.27 and $.32 per share, from a loss of $9.8 million, or $.81 per share, in the year-ago period.

The firm expects that it would end the quarter with $12.2 million in cash and cash equivalents.

For full year 2017, CareDx said it expects revenues of $45 million to $50 million, excluding potential AlloSure revenues. Analysts, on average, expect revenues of $46 million for the year.

The firm said that Nasdaq has given it until July 21 to submit a plan to regain compliance with a rule for filing its quarterly report in a timely manner. The firm said that it intends to file the 10-Q with the SEC as promptly as possible and prior to the deadline. It added that if it is still unable to file Form 10-Q by the due date, it "intends to submit a compliance plan on or prior to that date."

If submission of a compliance plan is needed, Nasdaq could grant an exception of up to 180 calendar days from the filing due date, or until Nov.13, so that CareDx can regain compliance, the firm said.

CareDx said that the Nasdaq notice has no immediate effect on the listing of its common stock.

In early morning trading on the Nasdaq, CareDx shares were down more than 7 percent to $1.01.