This story has been updated from a previous version to include comments made by GeneDx executives during an earnings call.
NEW YORK – GeneDx said Tuesday after the close of the market that its fourth quarter revenues grew 6 percent to $61.4 million from $57.8 million a year ago, but fell short of the Wall Street consensus estimate of $70.1 million.
GeneDx, performed 48.8 million tests in the quarter, excluding COVID-19 tests, 26 percent more than the 38.8 million in Q4 2021 when calculated on a pro forma basis. The company ceased COVID-19 testing in Q1 2022.
GeneDx is in the throes of change as it attempts to restructure and chart a course toward profitability, and the firm did not report other year-on-year comparisons for Q4. Net loss for the quarter ended Dec. 31 was $324.8 million, though the company did not provide loss per share. On an adjusted basis, the company recorded a Q4 net loss of $72.7 million.
At the beginning of 2023, the Stamford, Connecticut-based company formerly known as Sema4 adopted the GeneDx name that it had acquired less than a year earlier and changed its stock ticker symbol from SMFR to WGS.
Sema4 purchased GeneDx in April 2022 from Opko Health for $623 million and has announced two restructurings and three rounds of job cuts since the acquisition closed.
In November, the firm said that it would exit reproductive health testing by the end of the first quarter of 2023 and close one of its laboratories near its headquarters. The rebranded GeneDx instead will lean into the clinico-genomic insights market, focusing on whole-exome and whole-genome sequencing and related analysis to support precision medicine, particularly in pediatric rare diseases.
In a conference call to discuss its 2022 fourth quarter financial results, GeneDx President and CEO Kathleen Stueland reiterated that the latest restructuring puts the company on course to be profitable by 2025. She said that the company would be aggressive in attempting to educate physicians about the benefits of ordering exome-based tests instead of gene panels, particularly as payors expand coverage for whole-exome sequencing.
According to Stueland, GeneDx has analyzed more than 400,000 exomes to date, nearly a quarter of those in the last year. She added that data is "an important long-term strategic growth opportunity," even though it is a small part of the firm's business today.
Also, at the American College of Medical Genetics and Genomics annual meeting this week, partners in the GUARDIAN newborn genome sequencing study that GeneDx is supporting gave a rosy update on the study's progress.
Meanwhile, CFO Kevin Feeley said during the call that exome sequencing and analysis carry a 60 percent gross margin for GeneDx.
"We're in the perfect storm of commercial opportunity," Stueland said, citing expansion of clinical and practice guidelines and payor coverage policies that will benefit companies like GeneDx. Also during the call, Feeley said that the company would soon ask shareholders to approve a reverse stock split. He did not elaborate.
GeneDx, then Sema4, received a notice of noncompliance Dec. 28 because its stock price had been below $1 per share for 30 consecutive trading days. It has 180 days, until June 26, to come back into compliance by having a closing bid price of at least $1 per share for 10 consecutive trading days.
For full-year 2022, GeneDx reported revenues of $234.7 million, an increase of nearly 11 percent over the $212.2 million booked in 2021.
R&D expenses for the full year totaled $86.2 million, down 18 percent from $105.2 million in 2021. The company's SG&A costs rose 6 percent to $338.2 million in 2022 from $318.7 million a year earlier.
GeneDx's 2022 net loss more than doubled to $549.0 million, or $1.63 per share, from $245.4 million, or $2.27 per share, in 2021. The firm used 337.8 million shares to calculate its per-share loss in the recently completed year, compared to 108.1 million shares in the previous year.
The company had $123.9 million in cash and equivalents plus $13.5 million in restricted cash as of Dec. 31. It has not yet drawn on a $125 million revolving credit facility it has available.
GeneDx reiterated an earlier forecast that it expects 2023 revenues of $205 million to $220 million.
In January, the company brought in $150 million in gross proceeds from new public and direct stock offerings. Feeley said Tuesday that GeneDx expects to use $130 million to 145 million of its cash on hand in 2023, including $95 million to $100 million for continuing operations.
GeneDx shares advanced less than 2 percent Wednesday to close at $.35.