DermTech Reports Third-Quarter 2023 Financial Results
- Average selling price (ASP) for the DermTech Melanoma Test (DMT) increased 24 percent year-over-year
- Test revenue increased 8 percent versus the third quarter of 2022
- Cash runway into the first quarter of 2025
“We’re just a few months into our strategy of prioritizing reimbursed tests and growing revenue and are seeing faster progress than we expected,” said
Christensen continued, “We believe monetizing our already significant demand is the best way to reach a meaningful revenue inflection point while managing our balance sheet. Our operating expenses substantially declined in the third quarter even with solid revenue growth, and excluding non-recurring costs related to our restructuring actions, our net cash burn declined from approximately
Christensen concluded, “The powerful patient stories where we’ve had a role in potentially saving a life are why we push ahead. The patient need is great with approximately 200,000 new cases of melanoma reported every year in the
Third-Quarter 2023 Financial Results
- Billable sample volume declined 13 percent from the third quarter of 2022 to approximately 15,710.
-
Test revenue was
$3.7 million , up 8 percent from the third quarter of 2022, primarily due to a higher ASP for the DMT. -
Total revenue was
$3.9 million , a 10 percent increase from the third quarter of 2022, driven by higher test revenue. -
Cost of test revenue was
$3.7 million , a less than 1 percent increase from the third quarter of 2022, yielding a test gross margin of 1 percent, compared to negative 6 percent for the third quarter of 2022. Cost of test revenue increased primarily because of higher infrastructure costs related to the Company’s new facility. -
Sales and marketing expenses were
$8.1 million , a 44 percent decrease from the third quarter of 2022. The decrease was primarily attributable to lower employee-related and marketing expenditures. -
Research and development expenses were
$3.6 million , a 37 percent decrease from the third quarter of 2022, largely due to lower employee-related and lab supplies costs. -
General and administrative expenses were
$8.3 million , a 6 percent decrease from the third quarter of 2022. The decrease was driven primarily by lower employee-related costs, offset by higher infrastructure costs related to the Company's new facility. -
Net loss was
$19.2 million , or ($0.57 ) per share, which included$3.2 million of non-cash stock-based compensation expense, as compared to$28.8 million , or ($0.96 ) per share, for the third quarter of 2022, which included$4.9 million of non-cash stock-based compensation expense. -
Cash, cash equivalents, restricted cash and short-term marketable securities were
$71.7 million as ofSeptember 30, 2023 . During the third quarter, the Company generated net proceeds of approximately$0.5 million from the issuance of 302,598 shares of common stock in at-the-market (ATM) offerings at a weighted average price of$2.55 per share.DermTech believes it should have sufficient cash resources to fund its planned operations into the first quarter of 2025.
Conference Call Information
As previously announced, the Company will host a conference call to discuss its results at
About
Forward-Looking Statements
This press release includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. The expectations, estimates, and projections of
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Condensed Consolidated Statements of Operations |
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(in thousands, except share and per share data) |
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(Unaudited) |
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Three Months Ended |
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Nine Months Ended |
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|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Revenues: |
|
|
|
|
|
|
|
||||||||
Test revenue |
$ |
3,692 |
|
|
$ |
3,433 |
|
|
$ |
10,682 |
|
|
$ |
11,098 |
|
Contract revenue |
|
223 |
|
|
|
140 |
|
|
|
690 |
|
|
|
426 |
|
Total revenues |
|
3,915 |
|
|
|
3,573 |
|
|
|
11,372 |
|
|
|
11,524 |
|
Cost of revenues: |
|
|
|
|
|
|
|
||||||||
Cost of test revenue |
|
3,661 |
|
|
|
3,644 |
|
|
|
11,361 |
|
|
|
10,410 |
|
Cost of contract revenue |
|
82 |
|
|
|
50 |
|
|
|
175 |
|
|
|
111 |
|
Total cost of revenues |
|
3,743 |
|
|
|
3,694 |
|
|
|
11,536 |
|
|
|
10,521 |
|
Gross profit/(loss) |
|
172 |
|
|
|
(121 |
) |
|
|
(164 |
) |
|
|
1,003 |
|
Operating expenses: |
|
|
|
|
|
|
|
||||||||
Sales and marketing |
|
8,123 |
|
|
|
14,632 |
|
|
|
36,573 |
|
|
|
45,076 |
|
Research and development |
|
3,595 |
|
|
|
5,702 |
|
|
|
11,891 |
|
|
|
18,955 |
|
General and administrative |
|
8,264 |
|
|
|
8,806 |
|
|
|
35,359 |
|
|
|
26,258 |
|
Total operating expenses |
|
19,982 |
|
|
|
29,140 |
|
|
|
83,823 |
|
|
|
90,289 |
|
Loss from operations |
|
(19,810 |
) |
|
|
(29,261 |
) |
|
|
(83,987 |
) |
|
|
(89,286 |
) |
Other income: |
|
|
|
|
|
|
|
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Interest income, net |
|
641 |
|
|
|
485 |
|
|
|
2,186 |
|
|
|
700 |
|
Change in fair value of warrant liability |
|
5 |
|
|
|
4 |
|
|
|
4 |
|
|
|
126 |
|
Total other income |
|
646 |
|
|
|
489 |
|
|
|
2,190 |
|
|
|
826 |
|
Net loss |
$ |
(19,164 |
) |
|
$ |
(28,772 |
) |
|
$ |
(81,797 |
) |
|
$ |
(88,460 |
) |
Weighted average shares outstanding used in computing net loss per share, basic and diluted |
|
33,835,370 |
|
|
|
30,096,261 |
|
|
|
32,073,448 |
|
|
|
29,969,435 |
|
Net loss per share of common stock outstanding, basic and diluted |
$ |
(0.57 |
) |
|
$ |
(0.96 |
) |
|
$ |
(2.55 |
) |
|
$ |
(2.95 |
) |
|
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Condensed Consolidated Balance Sheets |
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(in thousands, except share and per share data) (Unaudited) |
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Assets |
|
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|
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Current assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
37,230 |
|
|
$ |
77,757 |
|
Short-term marketable securities |
|
30,970 |
|
|
|
48,411 |
|
Accounts receivable |
|
3,605 |
|
|
|
4,172 |
|
Inventory |
|
1,196 |
|
|
|
1,757 |
|
Prepaid expenses and other current assets |
|
2,928 |
|
|
|
3,940 |
|
Total current assets |
|
75,929 |
|
|
|
136,037 |
|
Property and equipment, net |
|
5,611 |
|
|
|
6,375 |
|
Operating lease right-of-use assets |
|
52,889 |
|
|
|
56,007 |
|
Restricted cash |
|
3,467 |
|
|
|
3,488 |
|
Other assets |
|
— |
|
|
|
168 |
|
Total assets |
$ |
137,896 |
|
|
$ |
202,075 |
|
Liabilities and Stockholders’ Equity |
|
|
|
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Current liabilities: |
|
|
|
||||
Accounts payable |
$ |
1,703 |
|
|
$ |
2,419 |
|
Accrued compensation |
|
5,773 |
|
|
|
7,894 |
|
Accrued liabilities |
|
1,946 |
|
|
|
3,464 |
|
Short-term deferred revenue |
|
236 |
|
|
|
109 |
|
Current portion of operating lease liabilities |
|
2,941 |
|
|
|
1,634 |
|
Current portion of finance lease obligations |
|
37 |
|
|
|
116 |
|
Total current liabilities |
|
12,636 |
|
|
|
15,636 |
|
Warrant liability |
|
1 |
|
|
|
5 |
|
Long-term finance lease obligations, less current portion |
|
42 |
|
|
|
53 |
|
Operating lease liabilities, long-term |
|
52,153 |
|
|
|
54,028 |
|
Total liabilities |
|
64,832 |
|
|
|
69,722 |
|
Stockholders’ equity: |
|
|
|
||||
Common stock, |
|
3 |
|
|
|
3 |
|
Additional paid-in capital |
|
477,778 |
|
|
|
456,171 |
|
Accumulated other comprehensive income/(loss) |
|
127 |
|
|
|
(774 |
) |
Accumulated deficit |
|
(404,844 |
) |
|
|
(323,047 |
) |
Total stockholders’ equity |
|
73,064 |
|
|
|
132,353 |
|
Total liabilities and stockholders’ equity |
$ |
137,896 |
|
|
$ |
202,075 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20231102342448/en/
(858) 291-1647
steve.kunszabo@dermtech.com
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