NEW YORK – CareDx reported after the close of the market Wednesday a 20 percent drop in fourth quarter revenues as testing services revenue flagged due primarily to a Medicare billing article change on these services.
For the three months ended Dec. 31, the Brisbane, California-based transplant diagnostics company logged revenues of $65.6 million compared to $82.4 million in the year-ago quarter, beating analysts' consensus estimate of $63.7 million and in line with preliminary revenues provided by the company in January.
Testing services revenue was $46.7 million in Q4, down 29 percent from $65.4 million a year ago. AlloSure and AlloMap patient results provided in Q4 were approximately 39,900, down 16 percent from the year-ago quarter but up 4 percent sequentially. Patient and digital solutions revenue grew 14 percent to $9.6 million in Q4, while product revenue grew 8 percent to $9.2 million.
CareDx's Q4 net loss swelled to $118.1 million, or $2.21 per share, from a net loss of $18.3 million, or $.34 per share, in Q4 2022 due to a one-time $96.3 million accrual related to damages awarded to Natera in January as part of a patent dispute with CareDx. Adjusted Q4 loss per share was $.17, bettering the Wall Street expectation of a $.27 loss per share.
CareDx said it is in the process of seeking judicial review of the damages, consisting of lost profits and past royalties, that were awarded by a jury in the US District Court for the District of Delaware.
The company's Q4 R&D spending fell 22 percent to $18.3 million from $23.6 million a year ago, while its SG&A expenses declined 4 percent to $46.5 million from $48.5 million.
"In 2023, we met our challenges head-on as we navigated the impact of Medicare coverage changes," Alex Johnson, president of patient and testing services and a member of the office of the CEO at CareDx, said in a statement. "We reset our operations, strategically reduced our cost structure, and created a growth pathway for the company in the second half of the year, as we continued to focus on care for transplant patients."
In November, CareDx announced that Reginald Seeto had stepped down as CEO and president, and that the company had established an office of the CEO comprising Johnson, board member Michael Goldberg, and CFO Abhishek Jain.
For full-year 2023, CareDx reported revenues of $280.3 million, down 13 percent from $321.8 million in 2022 and a tick above the high end of previous full-year guidance and preliminary revenues provided in January. Full-year revenues also bested the Wall Street expectation of $278.4 million.
Full-year testing services revenue dropped 20 percent to $209.7 million from $263.7 million in 2022, primarily due to the Medicare billing article change. Patient and digital solutions revenue grew 29 percent to $37.1 million while product revenue grew 15 percent to $33.5 million.
CareDx's 2023 net loss totaled $190.3 million, or $3.54 per share, compared to a net loss of $76.6 million, or $1.44 per share, in 2022. Adjusted loss per share was $.64 for the year, lower than analysts' average expectation of a loss per share of $.73.
The company finished the year with $82.2 million in cash and cash equivalents and $153.2 million in marketable securities.
For full-year 2024, CareDx said it expects revenues of $260 million to $274 million.