On August 3, 2021 Invitae Corporation (NYSE: NVTA), a leading medical genetics company, reported preliminary financial and operating results for the second quarter ended June 30, 2021 and increases 2021 guide to revenue between $475-$500 million for the year (Press release, Invitae, AUG 3, 2021, View Source [SID1234585607]).
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Invitae’s (NVTA) mission is to bring comprehensive genetic information into mainstream medical practice to improve the quality of healthcare for billions of people. www.invitae.com (PRNewsFoto/Invitae Corporation)
"Having now served more than 2 million patients, a major milestone for the quarter, we are seeing a clear and steady rise in the rate of adoption of genetics for personalized medicine, and we are sitting at the forefront of making the vision of genetics in mainstream medicine a reality," said Sean George, co-founder and chief executive officer of Invitae. "Years of investment in that reality have delivered yet another strong quarter of growth, and with increased confidence in continuing momentum we are increasing our revenue guidance for the year."
Second Quarter 2021 Financial Results
Generated revenue of $116.3 million in the quarter, a 152% increase compared to $46.2 million in the same period in 2020
Reported billable volume of 287,000 in the quarter, a 154% increase compared to 113,000 in the same period in 2020
Reported preliminary average cost per billable unit of $317 in the quarter compared to $380 average cost per billable unit in the same period in 2020. Non-GAAP average cost per unit was $261 in the quarter
Achieved preliminary gross profit for the second quarter of 2021 of $25.2 million, compared to $3.2 million in the same period in 2020. Non-GAAP gross profit was $41.2 million in the second quarter
Preliminary total operating expense, which excludes cost of revenue, for the second quarter of 2021 was $159.3 million compared to $145.3 million in the same period in 2020. Non-GAAP operating expenses, which excludes cost of revenue, for the quarter was $198.2 million.
Preliminary net loss for the second quarter of 2021 was $129.0 million, or a $0.64 net loss per share, compared to a net loss of $166.4 million, or a $1.29 net loss per share, in the second quarter of 2020. Non-GAAP net loss for the quarter was $170.8 million, or a $0.85 non-GAAP net loss per share.
Cost of revenue, operating expense and net loss and other results as indicated are preliminary and subject to change as we finalize acquisition-related adjustments related to the likelihood of achieving a milestone related to the ArcherDX acquisition which closed in October 2020. These non-cash adjustments are expected to be significant and would be expected to increase the gain and reduce the liability reported in the preliminary financial information contained herein. Any adjustments will be incorporated in Invitae’s Form 10-Q to be filed with the SEC on or before August 9, 2021.
At June 30, 2021, cash, cash equivalents, restricted cash and marketable securities totaled $1.54 billion as compared with $681.9 million as of March 31, 2021. Net increase in cash, cash equivalents and restricted cash for the quarter was $913.5 million. Cash burn was $256.8 million for the quarter. Cash burn for the quarter would have been $136.7 million excluding the cash paid for acquisitions, primarily related to the cash paid to acquire Genosity.
In April, the company announced that a small group of investors, led by SB Management, a subsidiary of Softbank Group Corp., made an investment of $1.2 billion in convertible senior notes to support the company’s future growth initiatives.
Corporate and Scientific Highlights
Acquired digital health AI company Medneon to add their risk assessment tools to Invitae’s education and clinical support offerings to further support cancer patients by making it easier for clinicians to determine who should get testing and how to use genetic information to individualize treatment.
Launched collaborative partnership with the ECOG-ACRIN Cancer Research Group providing genetic testing for the NCI-sponsored, Phase II APOLLO trial (led by Dr. Kim Reiss-Binder, University of Pennsylvania), investigating the effectiveness of PARP inhibitor Olaparib in treating pancreatic cancer patients with mutations in BRCA1, BRCA2 or PALB2 (NCT04858334).
Partnered with Children’s National Hospital to expand the knowledge of Mendelian disorders (conditions that run in families) by identifying novel causes of rare inherited diseases, investigating the mechanisms underlying undiagnosed conditions, and enhancing data sharing across the genomics research community.
Opened early access to its new Personalized Cancer Monitoring (PCM) platform as a laboratory-developed test performed at an Invitae central laboratory.
Presented multiple studies in multiple cancer types at the 2021 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting showing all cancer patients can benefit from germline genetic testing to guide their care, including:
Data from 250 pancreatic cancer patients from the landmark INTERCEPT study conducted at the Mayo Clinic showed that nearly one in six patients with pancreatic cancer showed cancer-linked genetic changes and, importantly, receiving germline testing was associated with improved survival.
The nationwide PROCLAIM study applied a universal genetic testing approach in 615 prostate cancer patients to assess the efficacy of current testing criteria and found, consistent with INTERCEPT, that current testing criteria deprive patients and clinicians of actionable information, particularly among underrepresented populations, showing a significant number of cancer treatment-linked variants were missed if testing was restricted to current NCCN guidelines.
A third study showed simply changing medical policy is not enough to drive changes in clinician adoption. In a review of two independent datasets, including commercially insured and Medicare Advantage enrollees, only 3% of the 55,595 colorectal cancer patients received germline genetic testing, despite medical policy recommending germline genetic testing for all colorectal cancer patients (consistent with the INTERCEPT colorectal cancer study). Of the patients who received testing, 18% had a cancer-linked variant and two thirds, or 67%, of those patients were potentially eligible for precision therapy and/or clinical trials.
Signed 43 biopharma partnership deals in the quarter, including the introduction of a new sponsored testing program to provide no-charge genetic testing to individuals at risk for or suspected of having the most common adult neurodegenerative conditions, including Parkinson’s disease, amyotrophic lateral sclerosis and early-onset Alzheimer’s disease, in the United States, Canada, Australia and Brazil.
Inducement Grants
Invitae reported that it is granting restricted stock units ("RSUs") to new employees who joined Invitae in connection with its recent acquisition of Medneon LLC. The RSUs are being granted under Invitae’s 2015 Stock Incentive Plan, which was amended and restated to increase a pool of shares of Invitae common stock thereunder which is used exclusively for the grant of inducement awards in compliance with New York Stock Exchange Rule 303A.08 ("Rule 303A.08"). The RSUs were approved by the Invitae Board of Directors and are made as an inducement material to each employee entering into employment with Invitae in reliance on the employment inducement exemption under Rule 303A.08. The RSUs cover a total of 114,000 shares of Invitae common stock and will vest in tranches of 25% upon each of the date of grant and the first, second and third anniversaries of such date, subject to acceleration in the event of a termination without cause by Invitae or a termination with good reason by a recipient. A total of 12 recipients will receive these RSUs and the founders of Medneon, Kamal Gogineni and Rakesh Patel, will receive RSUs with respect to 15,000 shares of Invitae common stock each.
Webcast and Conference Call Details
Management will host a conference call and webcast today at 4:30 p.m. Eastern / 1:30 p.m. Pacific to discuss financial results and recent developments. To access the conference call and webcast, please register at the link below:
Upon registering, each participant will be provided with call details and a registrant ID. Reminders will also be sent to registered participants via email.
The live webcast of the call and slide deck, may be accessed here or by visiting the investors section of the company’s website at ir.invitae.com. A replay of the webcast and conference call will be available shortly after the conclusion of the call and will be archived on the company’s website.