NEW YORK (360Dx) – Vermillion reported after the close of the market on Wednesday a 12 percent year-over-year jump in its third quarter revenues
For the three months ended Sept. 30, the Austin, Texas-based cancer diagnostics firm said that total revenues rose to $699,000 from $623,000 in the year-ago quarter.
Product revenues were $657,000, up 13 percent from $581,000 in Q3 2016. Service revenues from the company's Aspira IVD business were flat at $42,000.
Product revenue for the recently completed quarter was derived from 1,954 OVA1 tests performed, down from 2,257 OVA1 tests performed in Q3 2016. But revenue per test performed was up to $336, compared to $257 in the year-ago period.
This continues the trend evident since Vermillion began transitioning OVA1 sales from its former partner Quest Diagnostics to its subsidiary Aspira Labs in 2014. Since then, OVA1 test volume has dropped from around 4,000 tests per quarter to around 2,000, but Vermillion's revenues have held steady or improved slightly due to increased revenues per test.
On a conference call following the release of the earnings results, Vermillion President and CEO Valerie Palmieri attributed the company's sluggish volume numbers to a pullback in sales efforts in recent years as the company concentrated on getting OVA1 included in relevant treatment guidelines and expanding payor coverage for the test.
The recently ended quarter saw progress on the insurer front, Palmieri noted. The company added 14.8 million covered lives through an agreement with Healthcare Service Corporation, which covers patients in Illinois, Montana, New Mexico, Oklahoma, and Texas. It also announced during the quarter that it had received coverage for OVA1 from Blue Cross Blue Shield of Louisiana, as well as from the Louisiana and Arizona state Medicaid programs.
Palmieri said that Vermillion is now working to expand its sales force in certain regions with high payor penetration, with converting top Quest legacy territories to in-house sales teams a primary goal.
The company also received OVA1 pricing news that could help keep revenues up even in the face of slow sales volume. Preliminary pricing for OVA1 was set by CMS at a proposed rate of $897 under PAMA, which Palmieri said was a fourfold boost over the OVA1 pricing the company has historically received from its local Medicare carrier.
Vermillion had a net loss for the quarter of $2.5 million, or $.06 per share, compared to a net loss of $3.5 million, or $.07 per share, in Q3 2016.
Its R&D expenses were down 48 percent to $192,000 from $370,000, while its SG&A spending fell 24 percent to $2.2 million from $2.9 million.
The company finished the quarter with $7.8 million in cash and cash equivalents.
In Thursday morning trading on Nasdaq, Vermillion stock was flat at $1.57 per share.