MDxHealth Provides Q3-2019 Business Update
IRVINE, CA, and HERSTAL, BELGIUM – November 11, 2019 – MDxHealth SA (Euronext: MDXH.BR), a commercial-stage innovative molecular diagnostics company, today provided a business update for the three and nine months ended September 30, 2019.
Michael McGarrity, CEO of MDxHealth, said: “During this transitional period for MDxHealth we have set a foundation that will enable us to drive growth into our best in class menu which provides a pathway for both clinicians and patients screened for prostate cancer. We are confident that our refocused commercial organization, strengthened leadership team, financial operating discipline and clear strategic focus will serve as drivers of revenue growth.
This confidence is based in the actions we have taken to strengthen and focus our commercial organization and our ability to leverage the following key areas, which will be the catalyst for our growth projections. First, we are driving utilization into our current ConfirmMDx customer base, with a clear targeted approach to segmenting our focus through analytics related to payer mix and experience with adoption of a clinical pathway. We expect to see a return of this focus evidenced by growth in our unit volume for ConfirmMDx going forward.
Secondly, we have clear visibility to Medicare coverage for our SelectMDx test, evidenced by the Draft LCD achieved during the third quarter. It should be noted that final issuance of coverage will drive immediate revenue growth for that segment of our customer base. We look forward to providing visibility and guidance to both these growth drivers at the time of our full year results.”
Operational highlights for the three and nine months ended September 30, 2019
ConfirmMDx
- For the nine months ended September 30, 2019, billable test volume was down 13% to 13,037 versus 14,975 for the same period last year, due to non-recurring utility study volume last year as well as instability and restructuring of the commercial organization
·For the three months ended September 30, 2019, billable test volume was up 5% to 4,305 versus 4,111 for the same period last year
SelectMDx
- Positive draft Local Coverage Determination (LCD) released August 22, 2019. The draft LCD recommends coverage of the test for qualified Medicare patients throughout the United States
- For the nine months ended September 30, 2019, global billable test volume was up 84% to 16,801 versus 9,153 for the same period last year
- For the three months ended September 30, 2019, global billable test volume was up 50% to 4,273 versus 2,840 for the same period last year
- U.S. SelectMDx volumes have moderated, as expected, as a result of our focus on building the foundations for ConfirmMDx growth. We expect SelectMDx billed volumes and revenues to accelerate upon receipt of final LCD coverage decision, expected in H1-2020
Summary of billable test volume by product
| Territory | Products | Nine Months Ended September 30, | ||
| 2019 | 2018 | % Change | ||
| U.S. | ConfirmMDx | 13,037 | 14,975 | (13)% |
| SelectMDx | 13,418 | 7,250 | 85% | |
| E.U. | SelectMDx | 3,383 | 1,903 | 78% |
| Territory | Products | Three Months Ended September 30, | ||
| 2019 | 2018 | % Change | ||
| U.S. | ConfirmMDx | 4,305 | 4,111 | 5% |
| SelectMDx | 3,200 | 2,315 | 38% | |
| E.U. | SelectMDx | 1,073 | 525 | 104% |
Financial Highlights for the nine months ended September 30, 2019
- For the nine months ended September 30, 2019, product revenue was down 31% to $15.3 million from $22.1 million for the same period last year. Revenues declined more than the decline in unit volume primarily as a result of accounts receivable adjustments, payor mix, and timing of collections. However, underlying reimbursement levels obtained were stable
- For the nine months ended September 30, 2019, operating loss was $20.6 million, an improvement of $1.9 million over the same period last year due to continued focus on operating expense discipline
- Cash and cash equivalents of $16.4 million as of September 30, 2019, following an equity capital increase of €9 million, or approx. $10 million
- On November 1, 2019, under the loan facility entered into with Kreos Capital, the Company drew down €9 million, or approx. $10 million, bringing September 30, 2019 pro forma cash and cash equivalents to $26.4 million
Financial review for the nine months ended September 30, 2019
| USD in thousands (except per share data) | Nine Months Ended September 30, | |||
| 2019 | 2018 | $ Change | % Change | |
| Product revenue | 15,270 | 22,117 | (6,847) | (31)% |
| Royalties and patent income | 342 | 1,865 | (1,523) | (82)% |
| Total Revenue | 15,612 | 23,982 | (8,370) | (35)% |
| Gross Profit | 6,819 | 15,116 | (8,297) | (55)% |
| Operating expenses | (27,452) | (37,660) | 10,208 | 27% |
| Operating loss | (20,633) | (22,544) | 1,911 | 8% |
| Net loss | (20,915) | (22,842) | 1,927 | 8% |
| Basic and diluted loss per share | (0.35) | (0.40) | 0.05 | 13% |
Post Period Developments
- The Board of Directors elected Mr. Timothy Still as an independent director. Mr. Still, most recently the President and CEO of Myoscience, has over 29 years of experience in the medical device and diagnostics market with an accomplished track record of building and structuring commercial organizations, fundraising, and M&A. Prior to Myoscience, Mr. Still was the Executive Chairman of Gold Standard Diagnostics and also served as the President and CEO of Global Kinetics Corporation. Mr. Still holds a Bachelor’s Degree from the University of California at Davis and an MBA from the University of Southern California.
- On October 30th Walter Narajowski, independent director (represented by LabDx, LLC), has informed the Company of his decision to retire from the Board of Directors after five years of dedicated service.
Commenting on the changes to the MDxHealth Board, Mr. Koen Hoffman, Chairman of the Board, said "We welcome Tim Still to the board and offer our thanks and deep appreciation for the many years of valuable service by Walter Narajowski."
About MDxHealth
MDxHealth is a multinational healthcare company that provides actionable molecular diagnostic information to personalize the diagnosis and treatment of cancer. The company's tests are based on proprietary genetic, epigenetic (methylation) and other molecular technologies and assist physicians with the diagnosis of urologic cancers, prognosis of recurrence risk, and prediction of response to a specific therapy. The Company’s European headquarters are in Herstal, Belgium, with laboratory operations in Nijmegen, The Netherlands, and US headquarters and laboratory operations based in Irvine, California. For more information, visit and follow us on social media at: , and .
For more information:
| MDxHealth | |
| Consilium Strategic Communications (IR & PR) Amber Fennell, Chris Welsh, Marieke Vermeersch, Nicholas Brown UK: 1 |
This press release contains forward-looking statements and estimates with respect to the anticipated future performance of MDxHealth and the market in which it operates. Such statements and estimates are based on assumptions and assessments of known and unknown risks, uncertainties and other factors, which were deemed reasonable but may not prove to be correct. Actual events are difficult to predict, may depend upon factors that are beyond the company’s control, and may turn out to be materially different. MDxHealth expressly disclaims any obligation to update any such forward-looking statements in this release to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based unless required by law or regulation. This press release does not constitute an offer or invitation for the sale or purchase of securities or assets of MDxHealth in any jurisdiction. No securities of MDxHealth may be offered or sold within the United States without registration under the U.S. Securities Act of 1933, as amended, or in compliance with an exemption therefrom, and in accordance with any applicable U.S. securities laws.
NOTE: The MDxHealth logo, MDxHealth, ConfirmMDx, and SelectMDx are trademarks or registered trademarks of MDxHealth SA.
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