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| 8-K - FORM 8-K - CareDx, Inc. | d782629d8k.htm |
Exhibit 99.1
NEWS RELEASE
CareDx, Inc. Reports Second Quarter 2014 Financial Results
Record Quarterly Revenue reported
Brisbane, CA—August 27, 2014—CareDx, Inc. (Nasdaq: CDNA) a molecular diagnostics company focused on the development and commercialization of clinically differentiated, high value, non-invasive surveillance solutions for transplant recipients today reported financial results for the three and six months ended June 30, 2014.
Recent Accomplishments:
| • | Closing an initial public offering in July 2014, resulting in net proceeds to the Company of $35.5 million; |
| • | AlloMap, the Company’s molecular diagnostic surveillance solution, was used for heart transplant patients more than 3,000 times in the second quarter of 2014, representing 20% year-over-year growth and a new quarterly record; |
| • | Second quarter revenues of $6.8 million, representing 24% growth over the same period of 2013, and also a CareDx quarterly record; |
| • | Launch of the D-OAR (Donor-derived cell-free DNA Outcomes AlloMap Registry) clinical trial, which provides a research use only diagnostic tool to help clinicians and scientists investigate the use of cell-free (cf) DNA technology for heart transplant recipients; |
| • | Published results demonstrating that graft-derived cfDNA in the bloodstream correlates to acute cellular rejection in kidney and heart transplant recipients, further supporting the Company’s development initiatives. |
“As a result of significant AlloMap volume growth in the second quarter of 2014, revenues grew 24% over the prior year” said President and Chief Executive Officer, Peter Maag. “The past several months have been transformational for CareDx. With the success of the recent IPO, our strengthened balance sheet enables us to build on the momentum we have gained with our AlloMap surveillance solution for heart transplant patients and to pursue our development pipeline for cfDNA tests for heart and kidney transplant patients. The CareDx team is committed to driving forward the initiatives we laid out in order to create both short and long-term value for our shareholders.
Second Quarter Financial Results
Revenue for the three months ended June 30, 2014 increased 24% to $6.8 million, from $5.5 million in the same period of the prior year. U.S. AlloMap revenue accounted for nearly all of the revenue in the quarter, as volume increased 20% year-over-year.
Total operating expenses for the second quarter of 2014 were $7.1 million, an increase of 25% compared to the second quarter of 2013. Operating loss for the second quarter was $345,000. However, the second quarter of 2014 included one-time expenses of $750,000 associated with the legal, accounting and consulting fees of the ImmuMetrix acquisition. Without these expenses, the Company would have shown an operating profit of $405,000.
For the second quarter of 2014, net income was $877,000 and basic net income per share was $.87, primarily resulting from a one-time income tax benefit of $1.5 million, also resulting from the acquisition of ImmuMetrix in June 2014. Net loss for the comparable period in 2013 was $802,000 or ($0.79) per basic and diluted share. Cash and cash equivalents were $7.9 million as of June 30, 2014. Subsequent to June 30, the Company completed its initial public offering raising proceeds of approximately $35.5 million, after deducting underwriting discounts and commissions and other issuance costs.
2014 Outlook
CareDx expects revenue for the full year of 2014 to be in the range of $26 to $26.5 million.
Conference Call
Management will host a conference call today beginning at 1:30 p.m. PT / 4:30 p.m. ET. Individuals interested in listening to the conference call may do so by dialing (855) 420-0616 for domestic callers or (678) 304-6848 for international callers. Please reference Conference ID 73744990. To listen to a live webcast, please visit the investor relations section of CareDx’s website at: www.caredxinc.com.
A replay of the call will be available beginning August 27, 2014 at 4:30pm PT/7:30pm ET through midnight on August 28, 2014. To access the replay, dial (855) 859-2056 or (404) 537-3406 and reference Conference ID: 73744990. The webcast will also be available on CareDx’s website for one year following the completion of the call.
About CareDx
CareDx, Inc., based in Brisbane, California, is a molecular diagnostics company focused on the discovery, development, and commercialization of clinically differentiated, high-value, non-invasive diagnostic surveillance solutions for transplant recipients. The company has commercialized AlloMap, a gene expression test that aids clinicians in identifying heart transplant recipients with stable graft function who have a low probability of moderate/severe acute cellular rejection. For more information, please visit: www.CareDxInc.com.
Forward Looking Statements
In addition to the historical information, this press release contains forward-looking statements with respect to our business, research, development and commercialization efforts and anticipated future financial results. These forward-looking statements are based upon information that is currently available to us and our current expectations, speak only as of the date hereof, and are subject to numerous risks and uncertainties, including risks relating to our development and commercialization of additional diagnostic solutions, which is a lengthy and complex process that may not be successful, our dependence on the sales of one test, AlloMap, for substantially all of our current revenue, our dependence on Medicare for a substantial portion of our revenue, our dependence on health insurers and other third-party payers to provide coverage for our current test and future tests, if any, risks of increased competition from other market participants, many of whom have substantially greater resources than us, and risks relating to our intellectual property position and infringement claims from third parties that could be time-consuming and costly to defend and could preclude us from operating our business. These factors, together with those that are described in greater detail in the prospectus filed by us with the SEC on July 18, 2014, may cause our actual results, performance or achievements to differ materially and adversely from those anticipated or implied by our forward-looking statements. We expressly disclaim any obligation, except as required by law, or undertaking to update or revise any such forward-looking statements. Our results for the quarter ended June 30, 2014 are not necessarily indicative of our operating results for any future periods.
Investor Relations Contact:
Westwicke Partners
Leigh J. Salvo
(415) 513-1281
Leigh.salvo@westwicke.com
—Financial Tables Follow—
CareDx, Inc.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(unaudited)
(In thousands, except share and per share data)
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||
| Revenue: |
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| Testing revenue |
$ | 6,710 | $ | 5,333 | $ | 12,544 | $ | 10,142 | ||||||||
| Collaboration and license revenue |
66 | 124 | 156 | 296 | ||||||||||||
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| Total revenue |
6,776 | 5,457 | 12,700 | 10,438 | ||||||||||||
| Operating expenses: |
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| Cost of testing |
2,403 | 2,119 | 4,565 | 4,243 | ||||||||||||
| Research and development |
792 | 846 | 1,512 | 1,848 | ||||||||||||
| Sales and marketing |
1,610 | 1,548 | 3,084 | 3,117 | ||||||||||||
| General and administrative |
2,316 | 1,200 | 4,111 | 2,264 | ||||||||||||
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| Total operating expenses |
7,121 | 5,713 | 13,272 | 11,472 | ||||||||||||
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| Loss from operations |
(345 | ) | (256 | ) | (572 | ) | (1,034 | ) | ||||||||
| Interest expense, net |
(644 | ) | (541 | ) | (1,192 | ) | (1,106 | ) | ||||||||
| Other income (expense), net |
366 | (5 | ) | (163 | ) | (10 | ) | |||||||||
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| Loss before income taxes |
(623 | ) | (802 | ) | (1,927 | ) | (2,150 | ) | ||||||||
| Income tax benefit |
1,500 | — | 1,500 | — | ||||||||||||
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| Net income (loss) |
$ | 877 | $ | (802 | ) | $ | (427 | ) | $ | (2,150 | ) | |||||
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| Net income (loss) per share: |
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| Basic |
$ | 0.87 | $ | (0.79 | ) | $ | (0.42 | ) | $ | (2.13 | ) | |||||
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| Diluted |
$ | 0.13 | $ | (0.79 | ) | $ | (0.42 | ) | $ | (2.13 | ) | |||||
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| Shares used to compute net income (loss) per share |
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| Basic |
1,013,128 | 1,011,123 | 1,012,769 | 1,011,116 | ||||||||||||
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| Diluted |
6,939,568 | 1,011,123 | 1,012,769 | 1,011,116 | ||||||||||||
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CareDx, Inc.
CONSOLIDATED CONDENSED BALANCE SHEETS
(In thousands, except share and per share data)
| June 30, | December 31, | |||||||
| 2014 | 2013 | |||||||
| (Unaudited) | ||||||||
| Assets |
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| Current assets: |
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| Cash and cash equivalents |
$ | 7,872 | $ | 5,128 | ||||
| Accounts receivable |
1,725 | 2,270 | ||||||
| Inventory |
614 | 518 | ||||||
| Prepaid and other assets |
3,319 | 255 | ||||||
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| Total current assets |
13,530 | 8,171 | ||||||
| Property and equipment, net |
1,665 | 1,553 | ||||||
| Intangible assets, net |
6,650 | — | ||||||
| Goodwill |
12,005 | — | ||||||
| Restricted cash |
147 | 147 | ||||||
| Other noncurrent assets |
— | 2 | ||||||
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| Total assets |
$ | 33,997 | $ | 9,873 | ||||
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| Liabilities, convertible preferred stock, and stockholders’ deficit |
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| Current liabilities: |
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| Accounts payable |
$ | 1,741 | $ | 618 | ||||
| Accrued payroll liabilities |
1,190 | 1,386 | ||||||
| Accrued and other liabilities |
3,649 | 1,048 | ||||||
| Accrued royalties |
3,526 | — | ||||||
| Deferred revenue |
674 | 80 | ||||||
| Current portion of long-term debt, and subordinated convertible note |
10,434 | 4,461 | ||||||
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| Total current liabilities |
21,214 | 7,593 | ||||||
| Accrued royalties |
— | 2,804 | ||||||
| Deferred rent, net of current portion |
1,784 | 1,885 | ||||||
| Deferred revenue, net of current portion |
1,006 | 1,623 | ||||||
| Long-term debt, net of current portion |
8,338 | 10,914 | ||||||
| Convertible preferred stock warrant liability |
808 | 525 | ||||||
| Contingent consideration |
2,313 | — | ||||||
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| Total liabilities |
35,463 | 25,344 | ||||||
| Commitments and contingencies |
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| Convertible preferred stock: $0.001 par value; 7,501,370 and 6,417,954 shares authorized at June 30, 2014 and December 31, 2013, respectively; 6,043,808 and 5,155,673 shares issued and outstanding at June 30, 2014 and December 31, 2013, respectively; liquidation value of $156,567 and $137,221 at June 30, 2014 and December 31, 2013, respectively |
149,444 | 135,202 | ||||||
| Stockholders’ deficit: |
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| Common stock: $0.001 par value; 10,000,000 and 7,737,226 shares authorized at June 30, 2014 and December 31, 2013, respectively; 1,012,959 and 1,010,711 shares issued and outstanding at June 30, 2014 and December 31, 2013, respectively |
1 | 1 | ||||||
| Additional paid-in capital |
9,672 | 9,482 | ||||||
| Accumulated deficit |
(160,583 | ) | (160,156 | ) | ||||
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| Total stockholders’ deficit |
(150,910 | ) | (150,673 | ) | ||||
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| Total liabilities, convertible preferred stock and stockholders’ deficit |
$ | 33,997 | $ | 9,873 | ||||
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