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Vermillion Q1 Revenues Up 24 Percent

NEW YORK (360Dx) – Vermillion reported after the close of the market on Tuesday a 24 percent year-over-year rise in first quarter revenues.

For the three months ended March 31, the Austin, Texas-based cancer diagnostics firm said that total revenues rose to $803,000 from $649,000 in the year-ago quarter.

Product revenues were $779,000, up 27 percent from $613,000 in Q1 2018. Service revenues were $24,000, down 33 percent from $36,000 the year before.

Product revenues for the recently completed quarter were derived from 2,313 OVA1 tests performed, up 27 percent from the 1,818 OVA1 tests performed in Q1 2018. Revenue per test was flat year-over-year at $337.

In a statement, President and CEO Valerie Palmieri noted that the company launched OVA1+, its next-generation version of the test last quarter. "[O]ur sales this quarter are reflective of the positive responses we are seeing in the market," she said. "We believe that our risk assessment offerings have the potential to change the paradigm in ovarian cancer risk management."

The OVA1+ test combines the company's first-generation OVA1 test with its second-generation Overa test, using OVA1 as the initial test with Overa performed as a reflex test in the event of a positive OVA1 result. The combination provides improved specificity over OVA1 alone.

Vermillion also expanded its commercial team during the quarter. On a conference call following release of the Q1 results, Chris Goulart, the company's senior vice president of commercial operations, said it had 30 full-time employees on its commercial team with a presence in 20 sales territories.

He noted that OVA1 sales volumes had continued to rise in the beginning of Q2, with April volume up more than 60 percent year over year.

Goulart also provided an update on Vermillion's roll-out of its expanded ovarian cancer portfolio, named OVA360. The company plans in June to launch a genetic testing product consisting of a hereditary breast and ovarian cancer panel as well as a prenatal carrier screening panel.

Goulart added that Vermillion aims to release in the second half of the year a seven-protein panel to help monitor pelvic mass patients who don't opt for surgery. It is currently submitting a retrospective validation study for the test to a peer-reviewed journal, he said, adding that while the company will initially launch the assay as a laboratory-developed test, it is planning a prospective study with a future US Food and Drug Administration submission in mind.

Vermillion also this week saw publication of a study in the journal Biomarkers in Cancer that analyzed data from the company's previous prospective studies, finding that OVA1 provided superior performance for detecting ovarian cancer in African-American women compared to the biomarkers CA125 and HE4.

Goulart said the company is launching a multicenter study looking at the test's performance in the African-American population with the aim of creating ethnic-specific risk assessments.

For Q1 2019 Vermillion had a net loss of $3.7 million, or $.05 per share, compared to a net loss of $2.9 million, or $.05 per share, in Q1 2018.

Its R&D expenses rose 47 percent year over year to $209,000 from $142,000, while its SG&A spending was up 43 percent to $3.6 million from $2.5 million.

The company finished the quarter with $6.2 million in cash and cash equivalents.

In Wednesday morning trading on Nasdaq, Vermillion's stock was down 5 percent to $1.29 per share.