On August 6, 2024 Myriad Genetics, Inc. (NASDAQ: MYGN), a leader in genetic testing and precision medicine, reported financial results for its second quarter ended June 30, 2024 and raised its previously issued financial guidance on business performance for the full-year 2024 (Press release, Myriad Genetics, AUG 6, 2024, View Source [SID1234645427]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"We are very proud to have delivered another quarter of strong double digit year-over-year revenue growth in the second quarter of 2024. Our year-to-date 2024 revenue growth of 13% year-over-year, following our 11% year-over-year revenue growth in calendar year 2023, and our 15% year-over-year revenue growth in the second quarter 2024, demonstrate the sustainability of our organic growth and gives us the confidence to raise our long-term revenue growth target to 12%," said Paul J. Diaz, President and CEO of Myriad Genetics. "In the second quarter, we saw strong performance across our portfolio, highlighted by increasing evidence of market share gains in prenatal testing. We anticipate these trends to continue as we move through the year and into 2025. In addition, second quarter average revenue per test improved across our product portfolio, benefiting from expanded coverage and our ongoing efforts in revenue cycle management. We remain optimistic about the evolution of our product portfolio as we continue to publish additional clinical validation studies and launch new products.

At the same time, we continue to improve access and ease of use for our customers, as we accelerate electronic medical record (EMR) integrations for new customers and make meaningful progress in our Labs of the Future initiative. Myriad Genetics is growing profitably and delivering improved financial results, including a 17% year-over-year increase in gross profit of $147.1 million, cash flow from operations of $2.6 million, and $16.4 million of adjusted operating cash flow. All while continuing to invest in the innovation required to achieve our mission and vision to reach more patients with life-saving precision medicine."
Financial and Operational Highlights
•Test volumes of 389,000 in the second quarter of 2024 increased 9% year-over-year.
•The following table summarizes year-over-year testing volume changes in the company’s core product categories:
Three months ended Six months ended
(in thousands)
June 30, 2024 June 30, 2023
% Change
June 30, 2024 June 30, 2023
% Change
Product volumes:
Hereditary cancer
73 71 3 % 144 136 6 %
Tumor profiling
14 16 (13) % 28 32 (13) %
Prenatal 173 154 12 % 345 312 11 %
Pharmacogenomics
129 117 10 % 253 227 11 %
Total 389 358 9 % 770 707 9 %

•The following table summarizes year-over-year revenue changes in the company’s core product categories:
Three months ended Six months ended
(in millions)
June 30, 2024 June 30, 2023
% Change
June 30, 2024 June 30, 2023
% Change
Product revenues:
Hereditary cancer
$ 91.5 $ 76.7 19 % $ 179.6 $ 152.4 18 %
Tumor profiling
32.6 36.0 (9) % 63.5 73.3 (13) %
Prenatal 44.4 35.6 25 % 88.7 71.8 24 %
Pharmacogenomics
43.0 35.2 22 % 81.9 67.2 22 %
Total $ 211.5 $ 183.5 15 % $ 413.7 $ 364.7 13 %

•Gross margin of 69.6% in the second quarter of 2024 increased 110 basis points year-over-year, reflecting operating leverage and improved average revenue per test. Adjusted gross margin in the second quarter of 2024 was 70.1%, an increase of 110 basis points year-over-year as the company’s revenue cycle, Labs of the Future and supply chain initiatives begin to take hold.
•Second quarter of 2024 operating expenses were $183.6 million. Adjusted operating expenses were $140.8 million, increasing 6% over the year ago period. This increase was driven by investments in technology, product development and R&D. Adjusted operating expenses accounted for 67% of total revenue in the second quarter of 2024, down from 73% of total revenue in the second quarter of 2023.
2

•Operating loss in the second quarter of 2024 was $36.5 million, improving $77.2 million year-over-year; adjusted operating income in the second quarter of 2024 was $7.4 million, improving $14.2 million year-over-year.

Business Performance and Highlights

Oncology
The Oncology business delivered revenue of $82.2 million in the second quarter of 2024.
•Second quarter 2024 hereditary cancer testing revenue in Oncology grew 11% year-over-year, reflecting ongoing initiatives to improve average revenue per test through payer coverage expansion and revenue cycle process improvements that are reducing the company’s no pay rate.
•Second quarter 2024 tumor profiling revenue of $32.6 million grew 5% compared to first quarter 2024 but decreased 10% year-over-year, reflecting the ongoing challenging biopharma environment, slow ramp of biopharma contracts executed in 2023, and challenges in the international business.
•In July 2024, Myriad Genetics received a patent relating to detecting circulating tumor DNA in patient fluid samples, which is complementary to a patent granted earlier in the year for the company’s methods of preparing cell-free DNA. Both of these patents support advancing commercialization of the company’s high sensitivity tumor informed Molecular Residual Disease (MRD) assay.
•In July 2024, Myriad Genetics entered into an agreement with Personalis, Inc. (Nasdaq: PSNL) to cross-license patent estates covering tumor-informed approaches to detect MRD. The agreement helps solidify each company’s freedom to operate in the MRD market and broadens patient access to the benefits of MRD testing.
•Announced a collaboration with GSK (NYSE: GSK) aimed at improving access to homologous recombination deficiency (HRD) diagnostic testing for high-grade serous ovarian cancer (HGSOC) patients, leveraging Myriad Genetics’ MyChoice HRD Plus and MyChoice CDx Plus tests in nine countries outside the United States.
•Myriad Genetics and QIAGEN (NYSE: QGEN) agreed to develop a globally distributable kit-based test for analyzing HRD status to support research into personalized medicine in multiple solid tumor types, including ovarian cancer.
3

•In August 2024, Myriad Genetics announced that it further advanced its international reorganization efforts, including the closing of the sale of its EndoPredict business to Eurobio Scientific. The reorganization of its international operations better aligns company resources to its domestic opportunities while continuing to serve key biopharma partners and patients globally and builds on Myriad Genetics’ efforts this year to accelerate profitable business growth across its portfolio.

Women’s Health
The Women’s Health business delivered revenue of $86.3 million in the second quarter of 2024.
•Second quarter 2024 hereditary cancer testing revenue in Women’s Health grew 31% year-over-year as more practitioners see the benefit of incorporating MyRisk with RiskScore as part of a comprehensive breast cancer risk assessment program.
•Prenatal testing revenue in the second quarter of 2024 grew 25% year-over-year, reflecting market share gains, expanded coverage by payers, and ongoing initiatives to improve average revenue per test.
•Myriad Genetics launched the Universal Plus Panel for Foresight Carrier Screen, which includes 39 new conditions and screens up to 272 genes associated with serious inherited conditions.
•Ten abstracts, including four on FirstGene, have been accepted to be showcased at the National Society of Genetic Counselors’ 43rd annual meeting, which begins on September 17, 2024, in New Orleans, LA.

Pharmacogenomics
In the pharmacogenomics category, GeneSight test revenue was $43.0 million in the second quarter of 2024.
•Second quarter 2024 GeneSight testing revenue grew 22% year-over-year, reflecting ongoing initiatives to improve average revenue per test.
•Currently, biomarker legislation for state-regulated plans has passed in 15 states. In many of these states, commercial and managed Medicaid payers have modified their coverage policies to include GeneSight and Prolaris. Additionally, there are a number of states that have legislation in process. Myriad Genetics continues to see an increasing number of payors incorporating, or planning to incorporate, GeneSight into their coverage. Notably, this includes Blue Shield of California, a major commercial and managed Medicaid plan, effective July 1, 2024.

Financial Guidance
Myriad Genetics does not provide forward-looking guidance on a GAAP basis for the measures on which it provides forward-looking non-GAAP guidance as the company is unable to provide a quantitative reconciliation of forward-looking non-GAAP measures to the most directly comparable forward-looking GAAP measure, without unreasonable effort, because of the inherent difficulty in accurately forecasting the occurrence and financial impact of the various adjusting items necessary for such reconciliations that have not yet occurred, are dependent on various factors, are out of the company’s control, or cannot be reasonably predicted. Such adjustments include, but are not limited to, real estate optimization and transformation initiatives, certain litigation charges and loss contingencies, costs related to acquisitions/divestitures and the related amortization, impairment and related charges, and other adjustments. For example, stock-based compensation may fluctuate based on the timing of employee stock transactions and unpredictable fluctuations in the company’s stock price. Any associated estimate of these items and its impact on GAAP performance could vary materially.

Below is a table summarizing Myriad Genetics’ fiscal year 2024 financial guidance*:
(in millions, except per share amounts) PRIOR
FY 2024 CURRENT
FY 2024 Expected Year-Over-Year Change
Revenue $820 – $840 $835 – $845 11% – 12%
Gross margin % 69.5% – 70.5% 70.0% – 70.5%
100 – 150 bps
Adjusted OPEX $572 – $582
$575 – $585
6% – 8%
Adjusted EBITDA** $20 – $30
$25 – $35
$36 – $46
Adjusted EPS*** $0.00 – $0.05
$0.08 – $0.12
$0.35 – $0.39
*
Assumes currency rates as of August 6, 2024.
** Adjusted EBITDA is defined as Net Income (loss) plus income tax expense (benefit), total other income (expense), non-cash operating expenses, such as amortization of intangible assets, depreciation, impairment of long-lived assets, and share-based compensation expense, and one-time expenses such as expenses from real estate optimization initiatives, transformation initiatives, legal settlements, and divestitures and acquisitions.
***
Full-year 2024 adjusted EPS is based on a 91 million share count.

These projections are forward-looking statements and are subject to the risks summarized in the safe harbor statement at the end of this press release.

Conference Call and Webcast
A conference call will be held today, Tuesday, August 6, 2024, at 4:30 p.m. EDT to discuss Myriad Genetics’ financial results and business developments for the second quarter 2024. A live webcast of the conference call can be accessed on Myriad Genetics’ Investor Relations website at investor.myriad.com. To participate in the live conference call via telephone, please register at https://register.vevent.com/register/BI620080625d0e42be9b313c17391abf61. Upon registering, a dial-in number and unique PIN will be provided to join the conference call. Following the conference call, an archived webcast of the call will be available at investor.myriad.com.