Exact Sciences stock, revenue jumps
Company’s colon cancer test gains acceptance
Exact Sciences Corp.’s stock jumped Tuesday after the Madison company reported a 152% increase in revenue for 2016 as its noninvasive screening test for colon cancer continued to gain acceptance.
The company’s stock closed at $22.41, up 12.56%, or $2.50 a share, Tuesday. The stock has increased more than fourfold from its 52-week low of $4.67 a share.
Exact Sciences reported revenue of $99.4 million for the year, compared with revenue of $39.4 million in 2015. Its net loss was $167.2 million, or $1.63 a share, for the year, compared with $157.8, or $1.71 a share, in 2015.
For the fourth quarter, the company reported a net loss of $37.2. million, or 34 cents a share, on revenue of $35.2 million. That compared with a net loss of $40 million, or 41 cents a share, on revenue of $14.4 million in the fourth quarter of 2015.
Exact Sciences is building a market for its test and is not expected to post a net profit for several years.
But its gross margin increased to 61% in the fourth quarter of last year, compared with 47% in the fourth quarter of 2015. And the company ended the year with $311.1 million in cash, cash equivalents and marketable securities, up from $306.9 million at the end of 2015.
The company’s performance for the year solidifies its foundation for long-term growth, Kevin Conroy, chairman and chief executive officer of Exact Sciences, said in a conference call with Wall Street analysts.
It projects revenue of $170 million to $180 million this year.
Exact Science developed a non-invasive test that uses DNA-based technologies to analyze stool samples to screen for colon cancer.
The test, which was approved by the Food and Drug Administration in August 2014, is included in the recommendations of the U.S. Preventive Services Task Force and the American Cancer Society’s colorectal cancer screening guidelines.
The company, which spent $33.5 million on research and development last year, also is working to develop tests for lung, liver and other cancers.
The number of physicians and clinicians who ordered the company’s Cologuard test more than doubled last year, increasing to almost 60,000, the company said. More than 9,500 physicians and other clinicians ordered Cologuard for the first time in the fourth quarter of last year.
The company estimates that there are more than 200,000 primarycare physicians in the country.
“We have a long runway for growth,” Conroy said.
An estimated 171 million people now are in health plans that cover the company’s test, and Conroy said the company’s expects coverage by commercial health plans to continue to increase.
Approximately 244,000 Cologuard tests, including 82,000 in the fourth quarter, were completed last year.
Revenue per test averaged $432 in the fourth quarter.
Exact Sciences projects that 415,000 tests will be completed this year.
“We feel pretty good about the trajectory we are one, and the opportunity is significant,” Jeff Elliott, chief financial officer, said during the conference call.