NEW YORK (GenomeWeb) – MDxHealth said today that its full-year 2018 revenues dropped about 1 percent, driven by challenges in its US commercial growth. The firm has also begun an initiative to reduce costs and deliver sustainable revenue growth for 2019.
For the year ended Dec. 31, 2018, MDxHealth said it anticipates total revenues of $28.3 million, down from $28.5 million in 2017. MDxHealth had originally reported $40.5 million for 2017, but it normalized the amount for royalties from a sale of patents to Exact Sciences.
Product revenue for 2018 is expected to be $27.7 million, which MDxHealth said is comprised of $24.0 million for ConfirmMDx, $2.4 million for SelectMDx, and $1.3 million from other product revenue.
MDxHealth said that total genomic test volume increased by 16 percent to more than 38,000 cases in 2018 from 33,100 in 2017. Annual test volume of ConfirmMDx dropped 5 percent to 20,060 tests in 2018, while overall SelectMDx test volume rose 58 percent to over 18,000 tests in 2018.
"Although some challenges within our US commercial organization have hampered the growth of ConfirmMDx test volume, we firmly believe in the growth potential of our products," MDxHealth CEO Jan Groen said in a statement. "We launched an aggressive, targeted, commercial plan in December 2018 that includes a further rationalization of our operating footprint [which] will lay the foundation for renewed and sustainable revenue growth."
According to MDxHealth, the new plan will reduce operating cost by about $10 million on an annualized basis. The firm will realign US sales territories based on payor coverage and target increased overall cash collections and revenue. The firm will also focus operational departments solely on activities to support ConfirmMDx and SelectMDx.
However, MDxHealth will delay certain product pipeline initiatives, such as commercial rollout of AssureMDx, deferring an additional $10 million in expenditures that it had plan to use in 2019. In addition, the company will delay investments for prostate cancer, including InformMDx and MonitorMDx.
An MDxHealth spokesperson said in an email that the firm has accomplished the restructuring "mainly through "natural attrition," and that there have been no large-scale layoffs.
The firm expects $26.2 million in cash and cash equivalents as of the end of 2018, up from $16.8 million the previous year.
MDxHealth expects to announce its final 2018 financial results on February 28.