Exagen Inc. Reports Third Quarter 2019 Results
November 12 2019 - 4:05PM
Exagen Inc. (Nasdaq: XGN), an organization dedicated to
transforming the care continuum for patients suffering from
debilitating and chronic autoimmune diseases by enabling timely
differential diagnosis and optimizing therapeutic intervention,
today reported financial results for the quarter ended September
30, 2019.
Recent Highlights:
- Experienced record demand, including a 29% increase of flagship
AVISE® CTD volume, including AVISE® Lupus, to 27,159 tests.
- Grew the number of ordering healthcare providers by 29% to
1,591, compared to the third quarter of 2018, with 98% healthcare
provider adopter retention.
- Generated total revenue of $10.4 million for the third quarter
of 2019, representing 27% growth over the third quarter of
2018.
- Successfully completed initial public offering in September,
selling 4.14 million shares of stock with aggregate gross proceeds
to the company of $58.0 million.
- Advanced strategic integrated testing and therapeutics strategy
(Dx/Rx) through co-promotion agreement with Janssen Biotech for
SIMPONI®.
- Further expanded the salesforce to 55 representatives to
execute Dx/Rx strategy.
“The Exagen team took an important step in the quarter by
completing our initial public offering, which will help enable the
company’s continued growth. The company continues to execute at a
high level, delivering another record quarter of testing volumes,
increasing the number of ordering healthcare providers, and
benefiting patients suffering from chronic autoimmune
diseases. This continued traction resulted in revenue growth
of 27%. Our results are indicative of our momentum and we believe
we are well-positioned for continued growth in 2019 and beyond,”
said Ron Rocca, Exagen President and Chief Executive Officer. “The
Company’s Dx/Rx strategy is gaining momentum, with SIMPONI®
delivering incremental revenue in the quarter. Our recently
expanded sales force positions Exagen to execute on the significant
opportunity in front of the company.”
Third Quarter 2019 Financial Results
Revenue for the three months ended September 30, 2019 was $10.4
million, compared with $8.2 million in the third quarter of
2018. Testing revenues increased to $10.0 million, or a 23%
increase compared to the third quarter of 2018, driven by record
testing volumes in AVISE® CTD, including AVISE® Lupus. Revenue from
our co-promotion efforts contributed to $0.4 million in the third
quarter of 2019.
Gross margins improved to 54% in the third quarter of 2019
compared to 53% in the third quarter of 2018, driven by higher
testing volumes.
Operating expenses increased to $12.6 million in the third
quarter of 2019, compared with $9.4 million in the third quarter of
2018, due primarily to an increase in selling, general, and
administrative expenses associated with the salesforce
expansion.
For the third quarter of 2019, net loss was $3.1 million
compared to a net loss of $1.8 million in the third quarter of
2018.
Cash and cash equivalents were approximately $77.8 million as of
September 30, 2019.
2019 Guidance
For the full year 2019, Exagen expects revenue to be in the
range of $40 million to $41 million.
Conference Call
A conference call to discuss third quarter 2019 financial
results is scheduled for today November 12th, 2019 at 4:30 PM
Eastern Time (1:30PM Pacific Time). Interested parties may access
the conference call by dialing (877) 407-3982 (U.S.) or (201)
493-6780 (international). Media and individuals will be in a
listen-only mode. Participants are asked to dial in a few minutes
prior to the call to register for the event. A replay of the
conference call will be available until Tuesday, November 19, 2019
at 11:59 PM Eastern Time (8:59 PM Pacific Time). Interested parties
may access the replay of the conference call by dialing (844)
512-2921 (U.S.) or (412) 317-6671 (international) using passcode
13695740.
About Exagen
Exagen is dedicated to transforming the care continuum for
patients suffering from debilitating and chronic autoimmune
diseases by enabling timely differential diagnosis and optimizing
therapeutic intervention. Exagen has developed and is
commercializing a portfolio of innovative testing products under
its AVISE® brand, several of which are based on our proprietary
Cell-Bound Complement Activation Products, or CB-CAPs, technology.
CB-CAPs assess the activation of the complement system, a
biological pathway that is widely implicated across many autoimmune
and autoimmune-related diseases, including systemic lupus
erythematosus, or SLE. Exagen’s goal is to enable rheumatologists
to improve care for patients through the differential diagnosis,
prognosis and monitoring of complex autoimmune and
autoimmune-related diseases, including SLE and rheumatoid
arthritis, or RA. Exagen’s model of integrating testing products
and therapeutics positions Exagen to offer targeted solutions to
rheumatologists and, ultimately, better serve patients. For
more information, please visit www.Exagen.com
Forward Looking Statements
Exagen cautions you that statements contained in this press
release regarding matters that are not historical facts are
forward-looking statements. These statements are based on the
company’s current beliefs and expectations. Such forward-looking
statements include, but are not limited to, statements regarding:
the company’s belief it is positioned for continued growth in 2019
and beyond, including potential future momentum in the Dx/Rx
strategy; and full year 2019 guidance. The inclusion of
forward-looking statements should not be regarded as a
representation by Exagen that any of its plans will be achieved.
Actual results may differ from those set forth in this press
release due to the risks and uncertainties inherent in Exagen’s
business, including, without limitation: the company’s commercial
success depends upon attaining and maintaining significant market
acceptance of its testing products and promoted therapeutics among
rheumatologists, patients, third-party payers and others in the
medical community; the company’s ability to successfully execute on
its Dx/Rx strategy, including its promotion efforts for SIMPONI®;
the company’s dependence on third parties for reagents, equipment
and other materials used in its testing products; third-party
payers not providing coverage and adequate reimbursement for the
company’s testing products or promoted therapeutics; the company’s
ability to obtain and maintain intellectual property protection for
its testing products; regulatory developments affecting the
company’s business; the company may not achieve its guidance for
2019; and other risks described in the company’s prior press
releases and the Company’s filings with the Securities and Exchange
Commission (SEC), including under the heading “Risk Factors” in the
Company’s Registration Statement on Form S-1 and any subsequent
filings with the SEC. You are cautioned not to place undue reliance
on these forward-looking statements, which speak only as of the
date hereof, and Exagen undertakes no obligation to update such
statements to reflect events that occur or circumstances that exist
after the date hereof. All forward-looking statements are qualified
in their entirety by this cautionary statement, which is made under
the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995.
CONTACTS:
InvestorsWestwicke PartnersMike
CavanaughMike.Cavanaugh@westwicke.com646.677.1838
CompanyExagen Inc.Kamal
Adawikadawi@exagen.com760.477.5514
Exagen Inc.
Unaudited Condensed Statements of
Operations(in thousands, except share and per
share data)
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2019 |
|
2018 |
|
2019 |
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
10,439 |
|
|
$ |
8,223 |
|
|
$ |
30,173 |
|
|
$ |
22,799 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
Costs of revenue (excluding amortization of purchased
technology) |
|
4,783 |
|
|
3,852 |
|
|
14,217 |
|
|
11,376 |
|
Selling, general and administrative expenses |
|
7,306 |
|
|
4,932 |
|
|
20,787 |
|
|
14,419 |
|
Research and development expenses |
|
507 |
|
|
525 |
|
|
1,610 |
|
|
1,592 |
|
Amortization of intangible assets |
|
— |
|
|
47 |
|
|
— |
|
|
141 |
|
Total operating expenses |
|
12,596 |
|
|
9,356 |
|
|
36,614 |
|
|
27,528 |
|
Loss from operations |
|
(2,157 |
) |
|
(1,133 |
) |
|
(6,441 |
) |
|
(4,729 |
) |
Interest expense |
|
(909 |
) |
|
(704 |
) |
|
(2,720 |
) |
|
(2,098 |
) |
Change in fair value of
financial instruments |
|
(200 |
) |
|
55 |
|
|
267 |
|
|
55 |
|
Other income, net |
|
125 |
|
|
26 |
|
|
264 |
|
|
77 |
|
Net loss |
|
(3,141 |
) |
|
(1,756 |
) |
|
(8,630 |
) |
|
(6,695 |
) |
Accretion of redeemable
convertible preferred stock |
|
(338 |
) |
|
(2,768 |
) |
|
(4,640 |
) |
|
(6,462 |
) |
Deemed dividend recorded in
connection with financing transactions |
|
(13,601 |
) |
|
— |
|
|
(13,601 |
) |
|
(1,152 |
) |
Net loss attributable to
common stockholders |
|
$ |
(17,080 |
) |
|
$ |
(4,524 |
) |
|
$ |
(26,871 |
) |
|
$ |
(14,309 |
) |
Net loss per share, basic and
diluted |
|
$ |
(11.29 |
) |
|
$ |
(71.80 |
) |
|
$ |
(48.70 |
) |
|
$ |
(227.11 |
) |
Weighted-average number of
shares used to compute net loss per share, basic and diluted |
|
1,513,189 |
|
|
63,005 |
|
|
551,730 |
|
|
63,005 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exagen Inc.
Condensed Balance
Sheets(in thousands, except share and per share
data)
|
|
September 30, 2019 |
|
December 31, 2018 |
|
|
(Unaudited) |
|
(As Revised) |
Assets |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
77,828 |
|
|
$ |
13,164 |
|
Accounts receivable, net |
|
6,238 |
|
|
5,952 |
|
Prepaid expenses and other current assets |
|
1,686 |
|
|
2,196 |
|
Total current assets |
|
85,752 |
|
|
21,312 |
|
Property and equipment,
net |
|
1,314 |
|
|
1,566 |
|
Goodwill |
|
5,506 |
|
|
5,506 |
|
Other assets |
|
172 |
|
|
503 |
|
Total assets |
|
$ |
92,744 |
|
|
$ |
28,887 |
|
Liabilities,
Redeemable Convertible Preferred Stock and Stockholders' Equity
(Deficit) |
|
|
|
|
Current liabilities: |
|
|
|
|
Accounts payable |
|
$ |
1,213 |
|
|
$ |
1,279 |
|
Accrued liabilities |
|
6,449 |
|
|
3,923 |
|
Proceeds received prior to issuance of Series G redeemable
convertible preferred stock |
|
— |
|
|
3,750 |
|
Total current liabilities |
|
7,662 |
|
|
8,952 |
|
Borrowings-non-current
portion, net of discounts and debt issuance costs |
|
25,677 |
|
|
24,617 |
|
Redeemable convertible
preferred stock warrant liabilities |
|
— |
|
|
1,503 |
|
Deferred tax liabilities |
|
245 |
|
|
245 |
|
Other non-current
liabilities |
|
510 |
|
|
304 |
|
Total liabilities |
|
34,094 |
|
|
35,621 |
|
Commitments and
contingencies |
|
|
|
|
Redeemable convertible
preferred stock, $0.001 par value; 750,300,000 shares authorized;
none and 532,606,084 shares issued and outstanding at September 30,
2019 (unaudited) and December 31, 2018, respectively; liquidation
preference of $0 and $163,316 at September 31, 2019 (unaudited) and
December 31, 2018, respectively |
|
— |
|
|
105,232 |
|
Stockholders' equity
(deficit): |
|
|
|
|
Preferred stock, $0.001 par value; 10,000,000 shares authorized, no
shares issued or outstanding at September 30, 2019; no shares
authorized, issued or outstanding at December 31, 2018 |
|
— |
|
|
— |
|
Common stock, $0.001 par value; 200,000,000 and 1,470,000,000
shares authorized at September 30, 2019 (unaudited) and December
31, 2018, respectively; 12,559,492 and 63,005 shares issued and
outstanding at September 30, 2019 (unaudited) and December 31,
2018, respectively |
|
13 |
|
|
— |
|
Additional paid-in capital |
|
219,831 |
|
|
40,598 |
|
Accumulated deficit |
|
(161,194 |
) |
|
(152,564 |
) |
Total stockholders' equity (deficit) |
|
58,650 |
|
|
(111,966 |
) |
Total liabilities, redeemable
convertible preferred stock and stockholders' equity (deficit) |
|
$ |
92,744 |
|
|
$ |
28,887 |
|
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