NEW YORK (GenomeWeb) — Cancer Genetics reported after the close of the market Monday a 26 percent drop in its third quarter revenues due to declines across its biopharma, clinical, and discovery services units.
For the three-month period ended Sept. 30, Rutherford, New Jersey-based CGI posted revenues of $5.9 million versus $8.0 million in the same period a year before.
Biopharma services revenues fell nearly 10 percent to $3.8 million from $4.2 million. CGI said that biopharma projects are dependent on the timing, size, and duration of contracts with clients, resulting in fluctuations between comparable periods. It added that the number of clinical trials it is supporting increased to 241 in Q3 from 191 the year before.
"As a part of our transformation strategy, we focused our efforts on expanding our biopharma business," CGI CEO John Roberts said in a statement. "We signed a strategic partnership with Cellaria to develop precision medicine tools that support research related to cancer therapies, which we believe will contribute to the growth of our biopharma business."
Clinical services revenues were down nearly 45 percent in Q3 to $1.6 million from $2.9 million, which the company attributed in part to its recent adoption of the ASC SC 606 accounting standard and a planned reduction of its test menu, which was intended to eliminate non-cash generating activities. Meanwhile, discovery services revenues dipped 44 percent to $500,000 from $900,000.
CGI's third quarter net loss jumped to $8.5 million, or $.31 per share, from $600,000, or $.15 per share, in the year-ago quarter.
Its R&D spending in the quarter declined 30 percent to $692,000 from $981,000, while SG&A expenses climbed 13 percent to $6.3 million from $5.6 million year over year. In Q3 2018, CGI also incurred $1.4 million in costs related to a recently completed restructuring that included the consolidation of the firm's West coast molecular profiling laboratory to its New Jersey and North Carolina labs.
At the end of September, CGI — which recently agreed to merge with Jerusalem-based NovellusDx — had cash and cash equivalents totaling $1.2 million.