This article has been updated to clarify the reasons for the year-over-year decline in diagnostic services revenue.
NEW YORK (GenomeWeb) – Sequenom's second quarter 2016 revenues fell 11 percent compared to the second quarter of 2015, the firm reported in a filing with the US Securities Exchange Commission.
The molecular diagnostics company reported $29.3 million in Q2 2016 revenues, down from $32.8 million in Q2 2015, missing analysts' average estimate of $30.3 million.
Sequenom reported its second quarter earnings in a Form 10-Q filed with the SEC, on the heels of last month's announcement that Laboratory Corporation of America would acquire the company for $302 million in cash, a deal that is expected to close by the end of the year.
Total revenues included $26.5 million in diagnostic services revenues, generated from its laboratory developed tests, including carrier screening tests as well as multiple noninvasive prenatal tests for high-risk and average-risk pregnancies. The firm reported $30.9 million in diagnostic revenues for Q2 2015.
Sequenom accessioned 46,400 tests in the quarter, up 4.5 percent from 44,400 in Q2 2015 and flat sequentially. Of those, the firm reported 41,400 were noninvasive prenatal tests, though it did not break down how many tests it ran of each of its three NIPT offerings — MaterniT21 Plus, MaterniT Genome, and VisibiliT.
Despite the increase in tests accessioned — which was primarily driven by average-risk pregnancies — diagnostic services revenues decreased year over year. The firm attributed the decrease primarily to "a reduction in cash basis revenue for collections related to prior periods as the volume of unrecorded receivables has declined." In addition, Sequenom cited a reduction in its average rate of reimbursement as it continues to increase the percentage of tests billed under in-network payor agreements.
Sequenom's carrier screening test volume also declined. And growth in testing volumes were further negatively affected by a 10 percent reduction in field sales personnel, the company reported.
Sequenom also recognized $2.8 million in license fees — up from $1.9 million in Q2 2015 — from a patent pool agreement it struck with Illumina in 2014 that now includes 50 licensees. Four new laboratories joined the patent pool agreement in Q2 and 32 of the 50 participants were active by the end of the quarter.
Sequenom's Q2 net loss narrowed year over year to $6.3 million, or $.05 per share, from $9.0 million, or $.08 per share, beating analysts' average estimate for a loss per share of $.07.
The firm's R&D expenses fell 28 percent to $4.1 million in Q2 2016, down from $5.7 million in Q2 2015, while SG&A costs were down 7 percent $15.7 million, down from $16.9 million.
Sequenom ended the quarter with $60.7 million in cash and cash equivalents, and $597,000 in marketable securities.