SAN FRANCISCO – In a presentation at the JP Morgan Healthcare Conference here on Wednesday, NeoGenomics CEO Chris Smith offered financial guidance for fiscal year 2025 and additional information about the company's long-term financial plans.
Last week, Smith announced he would retire as CEO and board member, effective April 1. Tony Zook, an independent board member, will take over as CEO.
Although NeoGenomics did not provide preliminary financial results for 2024, Smith reaffirmed previous guidance of revenues between $655 million and $667 million.
The firm expects 2025 revenues between $735 million and $745 million, indicating growth between 11 percent and 13 percent, and anticipates at least 25 percent growth of its next-generation sequencing testing business. NGS continues to be a driver of overall revenue growth, CFO Jeff Sherman said.
NeoGenomics is also implementing revenue cycle management initiatives to further increase its revenue growth, as Sherman said it is not getting reimbursed for many of the large panel tests it is performing.
In the long term, Smith said the firm expects annual base revenue growth between 12 percent and 13 percent, although he specified that this estimate does not include any revenue related to minimal residual disease testing — an area the company is looking to enter with its Radar assay. NeoGenomics also expects its NGS business to continue to grow about 25 percent per year.
While the company has traditionally focused on cancer diagnostic testing, Smith said NeoGenomics intends to move further into both the therapy selection and MRD markets with new product launches. 2025 will be the "year of the product," he added, with plans to launch a liquid biopsy test by the end of the year and to further build out its testing menu through internal R&D and licensing.
Chief Commercial Officer Warren Stone said the firm has thus far been focused largely on the community hospital setting, but as it moves into therapy selection, it will also direct its sales organization to community oncologists.
The firm has spent the past three years building out its commercial organization and improving operational efficiencies, and by the end of January, NeoGenomics expects to have mostly completed a 30 percent expansion of its sales force, Smith noted.
Regarding M&A, Smith said there is potential for bolt-on acquisition deals, but the company is more interested in licensing technology and strategic partnerships. There are "a lot of really innovative companies out there that don't have a distribution channel" that NeoGenomics may be able to work with, he noted. Any M&A deals would likely be relatively small and quickly accretive to the larger business. "We're not going to the mall and going shopping," he added. "The goal is to strategically fill gaps where we see those and really utilize our commercial organization."