NEW YORK (GenomeWeb) – Exact Sciences reported after the close of the market on Monday that its third quarter revenues rose 158 percent year over year, driven by a 136 percent increase in the number of completed Cologuard colon cancer tests.
For the three months ended Sept. 30, the molecular diagnostics company reported revenues of $72.6 million, up from $28.1 million a year earlier, and significantly beating analysts' consensus estimate of $65.0 million.
Exact completed 161,000 Cologuard tests during the quarter, with an average recognized revenue per test of $451. The company had expected to complete 150,000 tests during the quarter. Exact said that more than 10,000 healthcare providers ordered their initial Cologuard test during Q3 2017, and that approximately 91,000 providers have ordered the test since it was launched.
"A growing number of patients and physicians are demanding Cologuard," Exact Chairman and CEO Kevin Conroy said in a statement. "Through our direct-to-consumer television and marketing campaign and our national sales force, we are reaching a larger percentage of the 80 million people eligible to be screened with Cologuard."
On a conference call with analysts following the release of the earnings, Conroy added that the company is beginning to achieve its goal of making Cologuard a standard of care for colon cancer screening in the US, and that Exact believes it can achieve 40 percent market share in colon cancer screening over the long term.
He said that consumer reaction to Cologuard has been positive relative to colonoscopy, and further, the company is getting about 800 doctors each week to place initial orders for the test, a pace that has been consistent since Exact launched its TV ad campaign. This gives the company confidence to keep the campaign going in 2018, he added.
Conroy cautioned, however, that the rate at which Exact adds new physicians will decline in the long term. The firm's sales force is focused on signing up as many new doctors as possible, but now its goal is also to increase the rate of Cologuard use within the doctors' offices that already use the test, he said.
Conroy also disclosed that Exact acquired Salt Lake City-based software development firm SampleMinded during Q3. The two companies had been working together to develop a lab information system for Exact, and the acquisition is part of the firm's bid to strengthen its IT systems, Conroy noted. He did not disclose specific terms of the deal.
Exact's Q3 2017 net loss narrowed to $26.9 million, or $.23 per share, from $37.8 million, or $.36 per share, in the year-ago period. Analysts had expected a loss per share of $.30.
The company's R&D costs for the quarter rose 54 percent to $11.7 million from $7.6 million in Q3 2016, and its SG&A expenses rose 47 percent to $68.6 million from $46.6 million.
The firm ended the quarter with $50.8 million in cash and cash equivalents, and $411.7 million in marketable securities.
For full-year 2017, Exact raised its guidance for both revenues and test volume. The company now anticipates revenues of $254 million to $257 million and completed Cologuard test volume of 568,000 to 572,000 tests during 2017. The company's previous guidance was for 2017 revenues of $230 million to $240 million and at least 550,000 completed Cologuard tests. Analysts are expecting revenues of $244.3 million for 2017.
With 395,000 Cologuard tests completed through the end of the third quarter, the company anticipates completing 173,000 to 177,000 tests during the fourth quarter in order to reach its goal for the year. Conroy also said the company plans to increase its sales force and medical affairs team, and plans to purchase real estate in Q4 to make room for the larger staff. Exact is also expanding its lab capacity and plans to break ground on the new lab soon.
As for the company's pipeline of new tests, Exact believes its next market opportunity will be a noninvasive, blood-based biomarker test for differentiating lung nodules from lung cancer, Conroy said. Recent studies showed the test to have more than 90 percent sensitivity and specificity, he added. The company will give an update on its development in the first half of 2018.
Exact shares rose nearly 12 percent to $55.97 in Tuesday morning trading on the Nasdaq.