Myriad Genetics Reports Third Quarter 2024 Financial Results; Updates 2024 Financial Guidance
Myriad Genetics (MYGN) reported Q3 2024 revenue growth of 11% year-over-year to $213 million, driven by Pharmacogenomics (34%) and Prenatal (10%) segments. GAAP net loss improved to $22.1 million from $61.3 million in Q3 2023, with adjusted EBITDA increasing to $14.1 million from $1.4 million. The company updated its 2024 guidance, projecting revenue of $837-843 million and adjusted EPS of $0.12-$0.14. However, UnitedHealthcare announced plans to discontinue coverage of GeneSight testing effective January 2025, impacting approximately $40 million in trailing twelve-month revenue.
Myriad Genetics (MYGN) ha registrato una crescita del fatturato del 11% anno su anno per il terzo trimestre del 2024, raggiungendo 213 milioni di dollari, grazie ai segmenti di farmacogenomica (34%) e prenatale (10%). La perdita netta GAAP è migliorata a 22,1 milioni di dollari rispetto ai 61,3 milioni di dollari del terzo trimestre del 2023, con un EBITDA rettificato aumentato a 14,1 milioni di dollari dai 1,4 milioni di dollari precedenti. L'azienda ha aggiornato le sue previsioni per il 2024, prevedendo un fatturato tra 837 e 843 milioni di dollari e un utile per azione rettificato di 0,12-0,14 dollari. Tuttavia, UnitedHealthcare ha annunciato piani per interrompere la copertura del test GeneSight a partire da gennaio 2025, influenzando circa 40 milioni di dollari in fatturato degli ultimi dodici mesi.
Myriad Genetics (MYGN) reportó un crecimiento en los ingresos del 11% interanual en el tercer trimestre de 2024, alcanzando 213 millones de dólares, impulsado por los segmentos de farmacogenómica (34%) y prenatal (10%). La pérdida neta GAAP se mejoró a 22,1 millones de dólares desde los 61,3 millones de dólares en el tercer trimestre de 2023, y el EBITDA ajustado aumentó a 14,1 millones de dólares desde 1,4 millones de dólares. La empresa actualizó sus proyecciones para 2024, previendo ingresos de 837 a 843 millones de dólares y una EPS ajustada de 0,12 a 0,14 dólares. Sin embargo, UnitedHealthcare anunció planes para descontinuar la cobertura de la prueba GeneSight a partir de enero de 2025, lo que impactará aproximadamente 40 millones de dólares en ingresos de los últimos doce meses.
Myriad Genetics (MYGN)는 2024년 3분기 매출이 전년 대비 11% 증가하여 2억 1300만 달러에 이르렀다고 보고했습니다. 이는 약물유전자학(34%)과 산전(10%) 부문에 의해 주도되었습니다. GAAP 순손실은 2023년 3분기의 6130만 달러에서 2210만 달러로 개선되었으며, 조정 EBITDA는 1410만 달러로 증가했습니다. 회사는 2024년 매출 가이던스를 업데이트하여 8억 3700만~8억 4300만 달러와 조정된 주당 순이익(EPS)을 0.12~0.14 달러로 예상하고 있습니다. 그러나 UnitedHealthcare는 2025년 1월부터 GeneSight 테스트의 보장을 중단할 계획을 발표하여 최근 12개월의 약 4000만 달러의 매출에 영향을 미칠 것입니다.
Myriad Genetics (MYGN) a annoncé une croissance de 11% de son chiffre d'affaires au troisième trimestre 2024 par rapport à l'année précédente, atteignant 213 millions de dollars, tirée par les segments de la pharmacogénomique (34%) et du prénatal (10%). La perte nette selon les principes comptables GAAP s'est améliorée à 22,1 millions de dollars contre 61,3 millions de dollars au troisième trimestre 2023, avec un EBITDA ajusté en hausse à 14,1 millions de dollars contre 1,4 million de dollars. L'entreprise a mis à jour ses prévisions pour 2024, anticipant un chiffre d'affaires de 837 à 843 millions de dollars et un bénéfice par action ajusté de 0,12 à 0,14 dollar. Cependant, UnitedHealthcare a annoncé son intention de cesser la couverture des tests GeneSight à partir de janvier 2025, ce qui impactera environ 40 millions de dollars de chiffre d'affaires des douze derniers mois.
Myriad Genetics (MYGN) meldete im 3. Quartal 2024 ein Umsatzwachstum von 11% im Vergleich zum Vorjahr auf 213 Millionen Dollar, angetrieben durch die Segmente Pharmakogenomik (34%) und Pränatal (10%). Der GAAP-Nettoverlust verbesserte sich auf 22,1 Millionen Dollar im Vergleich zu 61,3 Millionen Dollar im 3. Quartal 2023, während das bereinigte EBITDA auf 14,1 Millionen Dollar stieg, verglichen mit 1,4 Millionen Dollar. Das Unternehmen aktualisierte seine Prognose für 2024 und erwartet einen Umsatz von 837 bis 843 Millionen Dollar und einen bereinigten Gewinn pro Aktie von 0,12 bis 0,14 Dollar. Allerdings kündigte UnitedHealthcare Pläne an, die Deckung des GeneSight-Tests ab Januar 2025 einzustellen, was einen Einfluss von etwa 40 Millionen Dollar auf die Umsätze der letzten zwölf Monate haben wird.
- 11% revenue growth to $213M in Q3 2024
- Significant net loss improvement from $61.3M to $22.1M year-over-year
- Adjusted EBITDA increased to $14.1M from $1.4M
- Pharmacogenomics revenue grew 34% year-over-year
- Prenatal testing revenue increased 10% year-over-year
- Gross margin improved 20 basis points to 70.2%
- UnitedHealthcare to discontinue GeneSight coverage, affecting $40M in annual revenue
- Operating loss of $20.0M in Q3 2024
- Tumor profiling volumes remained flat year-over-year
- Women's Health hereditary cancer testing revenue declined 2% year-over-year
Highlights
- Third quarter revenue grew
11% year-over-year to$213 million , driven by Pharmacogenomics (34% ) and Prenatal (10% ) and progress on payor coverage and revenue cycle initiatives. - Third quarter GAAP net loss improved to
$22.1 million from a loss of$61.3 million in the third quarter of 2023 on improved revenue, gross margins and disciplined management of operating expenses. Third quarter adjusted EBITDA increased to$14.1 million from$1.4 million in third quarter of 2023. - Third quarter GAAP loss per share improved to
$(0.24) from$(0.75) in the third quarter of 2023; adjusted earnings (loss) per share improved to$0.06 from ($0.03) in the third quarter of 2023. - Updated 2024 financial guidance to reflect our current business outlook, with full year revenue moving to a range of
$837 -$843 million , and adjusted earnings per share (EPS) to a range of$0.12 -$0.14 .1 - On November 1, 2024, UnitedHealthcare ("UNH") updated its medical policy for commercial and individual exchange plans to discontinue coverage of multi-gene panel pharmacogenetic testing, including GeneSight, effective January 1, 2025. Myriad Genetics generated approximately
$10 million and$40 million of GeneSight revenue from UNH's commercial population in the third quarter and trailing twelve month period ended September 30, respectively. Myriad Genetics continues to pursue a resolution with UNH that allows for its commercial enrollees to continue to have access to the GeneSight test.
SALT LAKE CITY, Nov. 07, 2024 (GLOBE NEWSWIRE) -- Myriad Genetics, Inc. (NASDAQ: MYGN), a leader in genetic testing and precision medicine, today announced financial results for its third quarter ended September 30, 2024 and updated its previously issued financial guidance on business performance for the full-year 2024.
“During the third quarter of 2024, we grew revenue by
_______________
1 The company does not forecast GAAP EPS because it cannot predict certain elements that are included in the reported GAAP results. Please see below under "Financial Guidance" for a full explanation.
Financial and Operational Highlights
- Test volumes of 376,000 in the third quarter of 2024 increased
6% year-over-year. - The following table summarizes year-over-year testing volume changes in the company's core product categories:
| Three months ended September 30, | Nine Months Ended September 30, | ||||||||||||
| (in thousands) | 2024 | 2023 | % Change | 2024 | 2023 | % Change | |||||||
| Product volumes: | |||||||||||||
| Hereditary cancer | 74 | 71 | 5 | % | 219 | 207 | 5 | % | |||||
| Tumor profiling | 13 | 13 | — | % | 41 | 45 | (9 | )% | |||||
| Prenatal | 162 | 156 | 3 | % | 506 | 469 | 8 | % | |||||
| Pharmacogenomics | 127 | 116 | 10 | % | 380 | 343 | 11 | % | |||||
| Total | 376 | 356 | 6 | % | 1,146 | 1,064 | 8 | % | |||||
- The following table summarizes year-over-year revenue changes in the company's core product categories:
| Three months ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
| (in millions) | 2024 | 2023 | % Change | 2024 | 2023 | % Change | |||||||||||
| Product revenues: | |||||||||||||||||
| Hereditary cancer | $ | 90.5 | $ | 86.5 | 5 | % | $ | 270.1 | $ | 238.9 | 13 | % | |||||
| Tumor profiling | 31.6 | 30.2 | 5 | % | 95.1 | 103.5 | (8 | )% | |||||||||
| Prenatal | 43.5 | 39.5 | 10 | % | 132.2 | 111.3 | 19 | % | |||||||||
| Pharmacogenomics | 47.7 | 35.7 | 34 | % | 129.6 | 102.9 | 26 | % | |||||||||
| Total | $ | 213.3 | $ | 191.9 | 11 | % | $ | 627.0 | $ | 556.6 | 13 | % | |||||
- Gross margin of
70.2% in the third quarter of 2024 increased 20 basis points year-over-year, reflecting operating leverage and improved average revenue per test. Adjusted gross margin in the third quarter of 2024 was70.6% , an increase of 20 basis points year-over-year. - Third quarter 2024 operating expenses were
$169.8 million , decreasing13% over the same period in the prior year due to significant legal costs incurred in the third quarter of 2023 that did not repeat in the third quarter of 2024. Operating expenses accounted for80% of total revenue in the third quarter of 2024, down from101% of total revenue in the third quarter of 2023. Adjusted operating expenses were$141.0 million , increasing3% over the same period in the prior year and reflect ongoing investments in technology, research and development offset by cost management activities. Adjusted operating expenses accounted for66% of total revenue in the third quarter of 2024, down from72% of total revenue in the third quarter of 2023. - Operating loss in the third quarter of 2024 was
$20.0 million , improving$40.1 million year-over-year; adjusted operating income in the third quarter of 2024 was$9.5 million , improving$11.7 million year-over-year.
Business Performance and Highlights
Oncology
The Oncology business delivered revenue of
- Third quarter 2024 hereditary cancer testing revenue in Oncology grew
11% year-over-year, reflecting both volume growth year-over-year and ongoing initiatives to improve average revenue per test. - Third quarter 2024 tumor profiling revenue of
$31.6 million grew5% year-over-year, as contributions from Precise Tumor and Prolaris were partly offset by a challenged biopharma environment and the sale of the EndoPredict business on August 1, 2024. - In October 2024, Myriad Genetics entered a collaboration with Flatiron Health, a leading health technology company, that allows physicians to order Myriad Genetics’ MyRisk Hereditary Cancer Test and view the results of the test directly in Flatiron’s cloud-based Electronic Medical Record (EMR) platform, OncoEMR.
- In October 2024, Myriad Genetics received a third patent relating to proprietary methods that generate ultra-sensitive detection of tumor-specific mutations in circulating tumor DNA (ctDNA), which is complementary to two patents granted earlier in the year for the company’s methods of preparing cell-free DNA. These patents support advancing commercialization of the company's high sensitivity tumor informed molecular residual disease (MRD) assay.
- Myriad Genetics has established a number of additional research collaborations regarding the use of the company's Precise MRD test for breast cancer patients, with leading cancer research institutions, including The University of Texas MD Anderson Cancer Center and the National Cancer Center Hospital East in Japan. Myriad Genetics has previously announced other MRD collaborations, including a metastatic breast cancer study with researchers at Memorial Sloan Kettering Cancer Center and a prospective pan-cancer study, including breast cancer, led by researchers at the National Cancer Center Hospital East in Japan.
Women’s Health
The Women’s Health business delivered revenue of
- Prenatal testing revenue in the third quarter of 2024 grew
10% year-over-year, reflecting volume growth and ongoing initiatives to improve average revenue per test. - Third quarter 2024 hereditary cancer testing revenue in Women's Health declined
2% year-over-year with modest volume growth which was offset by the fact that a favorable change in estimate for average revenue per test in the third quarter of 2023 did not repeat in the third quarter of 2024. Year-to-date 2024 hereditary cancer testing revenue in Women's Health grew12% compared to the same nine-month period in 2023 as we believe more practitioners have seen the benefit of incorporating MyRisk with RiskScore as part of a comprehensive breast cancer risk assessment program. - In October 2024, Myriad Genetics initiated a satellite media tour to coincide with new FDA guidelines to drive increased awareness and engagement around the connection between breast density and cancer risk. New FDA guidelines provide that mammography facilities are required to provide all patients receiving a mammogram with a breast density notification.
- In October 2024, Myriad Genetics established a strategic partnership with jscreen, a national organization providing access to genetic testing with a focus on high-risk populations. The partnership intends to reach hundreds of thousands of high-risk adults across the United States through targeted outreach and in-person genetic screenings.
Pharmacogenomics
In the pharmacogenomics business, GeneSight test revenue was
- Third quarter 2024 GeneSight testing revenue grew
34% year-over-year, reflecting double-digit test volume growth year-over-year and ongoing initiatives to improve payor coverage and 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. Additionally, there are a number of states where legislation is in process. Myriad Genetics continues to see an increasing number of payors incorporating, or planning to incorporate, GeneSight into their coverage.
- During the third quarter of 2024, Myriad Genetics expanded payor coverage for several products, including GeneSight. Third quarter saw an additional 17 new contracts and expanded medical policies and coverage, enhancing access to our products, including GeneSight.
- On November 1, 2024, UNH updated its medical policy for pharmacogenetic testing to no longer provide coverage for certain multi-gene panel pharmacogenetic tests, including our GeneSight test, under its commercial and individual exchange benefit plans, effective January 1, 2025. After initial review of the updated policy, the company strongly disagrees with UNH’s decision and its rationale that there is insufficient evidence of efficacy to support coverage of GeneSight. Myriad Genetics is actively engaging with UnitedHealthcare to discuss additional evidence for Myriad Genetics’ proprietary and clinically differentiated mental health medication test, and is seeking to ensure that enrollees continue to have access to the test. We do not believe that the updated policy affects coverage of GeneSight by UNH under Medicare Advantage and managed Medicaid plans or coverage by other payors.
Cash Flow and Liquidity
For the third quarter of 2024, restricted and unrestricted cash increased by
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) | INITIAL (as of February 27) | PRIOR (as of August 6) | CURRENT FY 2024 | Expected Year- Over-Year Change | ||
| Revenue | ||||||
| Gross margin % | 100 - 150 bps | |||||
| Adjusted OPEX | ||||||
| Adjusted EBITDA** | ||||||
| Adjusted EPS*** | ||||||
| * | Assumes currency rates as of November 7, 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 92 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, Thursday, November 7, 2024, at 4:30 p.m. ET to discuss Myriad Genetics’ financial results and business developments for the third 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://edge.media-server.com/mmc/p/cnfp9pdm/. 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.
About Myriad Genetics
Myriad Genetics is a leading genetic testing and precision medicine company dedicated to advancing health and well-being for all. Myriad Genetics provides insights that help people take control of their health and enable healthcare providers to better detect, treat, and prevent disease. Myriad Genetics develops and offers genetic tests that help assess the risk of developing disease or disease progression and guide treatment decisions across medical specialties where critical genetic insights can significantly improve patient care and lower healthcare costs. For more information, visit www.myriad.com.
Myriad, the Myriad logo, BRACAnalysis, BRACAnalysis CDx, Colaris, MyRisk, Myriad myRisk, MyRisk Hereditary Cancer, myChoice, Tumor BRACAnalysis CDx, MyChoice CDx, Prequel, Prequel with Amplify, Amplify, Foresight, Foresight Universal Plus, Precise Tumor, Precise Oncology Solutions, Precise Liquid, Precise MRD, FirstGene, SneakPeek, SneakPeek Early Gender DNA Test, SneakPeek Snap, Urosuite, Mygenehistory, Health.Illuminated., RiskScore, Prolaris, and GeneSight are registered trademarks or trademarks of Myriad Genetics, Inc. All third-party marks—® and ™—are the property of their respective owners. © 2024 Myriad Genetics, Inc. All rights reserved.
Revenue by Product (Unaudited)
| Three months ended September 30, | ||||||||||||||||||||
| (in millions) | 2024 | 2023 | ||||||||||||||||||
| WH | ONC | PGx | Total | WH | ONC | PGx | Total | % Change | ||||||||||||
| Hereditary Cancer | $ | 39.2 | $ | 51.3 | $ | — | $ | 90.5 | $ | 40.2 | $ | 46.3 | $ | — | $ | 86.5 | 5 | % | ||
| Tumor Profiling | — | 31.6 | — | 31.6 | — | 30.2 | — | 30.2 | 5 | % | ||||||||||
| Prenatal | 43.5 | — | — | 43.5 | 39.5 | — | — | 39.5 | 10 | % | ||||||||||
| Pharmacogenomics | — | — | 47.7 | 47.7 | — | — | 35.7 | 35.7 | 34 | % | ||||||||||
| Total Revenue | $ | 82.7 | $ | 82.9 | $ | 47.7 | $ | 213.3 | $ | 79.7 | $ | 76.5 | $ | 35.7 | $ | 191.9 | 11 | % | ||
| Nine months ended September 30, | ||||||||||||||||||||
| (in millions) | 2024 | 2023 | ||||||||||||||||||
| WH | ONC | PGx | Total | WH | ONC | PGx | Total | % Change | ||||||||||||
| Hereditary Cancer | $ | 120.7 | $ | 149.4 | $ | — | $ | 270.1 | $ | 107.6 | $ | 131.3 | $ | — | $ | 238.9 | 13 | % | ||
| Tumor Profiling | — | 95.1 | — | 95.1 | — | 103.5 | — | 103.5 | (8 | )% | ||||||||||
| Prenatal | 132.2 | — | — | 132.2 | 111.3 | — | — | 111.3 | 19 | % | ||||||||||
| Pharmacogenomics | — | — | 129.6 | 129.6 | — | — | 102.9 | 102.9 | 26 | % | ||||||||||
| Total Revenue | $ | 252.9 | $ | 244.5 | $ | 129.6 | $ | 627.0 | $ | 218.9 | $ | 234.8 | $ | 102.9 | $ | 556.6 | 13 | % | ||
Business Units:
WH = Women’s Health
ONC = Oncology
PGx = Pharmacogenomics
Product Categories:
Hereditary Cancer – MyRisk, BRACAnalysis, BRACAnalysis CDx
Tumor Profiling – myChoice CDx, Prolaris, Precise Tumor, EndoPredict
Prenatal – Foresight, Prequel, SneakPeek
Pharmacogenomics – GeneSight
| MYRIAD GENETICS, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Operations (unaudited) (in millions, except per share amounts) | |||||||||||||||
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Testing revenue | $ | 213.3 | $ | 191.9 | $ | 627.0 | $ | 556.6 | |||||||
| Costs and expenses: | |||||||||||||||
| Cost of testing revenue | 63.5 | 57.6 | 192.5 | 174.6 | |||||||||||
| Research and development expense | 28.5 | 24.0 | 81.2 | 67.7 | |||||||||||
| Selling, general, and administrative expense | 139.1 | 136.1 | 424.0 | 428.5 | |||||||||||
| Legal settlements | — | 34.3 | — | 111.8 | |||||||||||
| Goodwill and long-lived asset impairment charges | 2.2 | — | 13.8 | — | |||||||||||
| Total costs and expenses | 233.3 | 252.0 | 711.5 | 782.6 | |||||||||||
| Operating loss | (20.0 | ) | (60.1 | ) | (84.5 | ) | (226.0 | ) | |||||||
| Other income (expense): | |||||||||||||||
| Interest income | 0.4 | 0.6 | 1.4 | 1.8 | |||||||||||
| Interest expense | (0.8 | ) | (1.0 | ) | (2.1 | ) | (2.0 | ) | |||||||
| Other | (0.8 | ) | (0.7 | ) | 0.8 | (3.7 | ) | ||||||||
| Total other income (expense), net | (1.2 | ) | (1.1 | ) | 0.1 | (3.9 | ) | ||||||||
| Loss before income tax | (21.2 | ) | (61.2 | ) | (84.4 | ) | (229.9 | ) | |||||||
| Income tax expense | 0.9 | 0.1 | 0.4 | 2.2 | |||||||||||
| Net loss | $ | (22.1 | ) | $ | (61.3 | ) | $ | (84.8 | ) | $ | (232.1 | ) | |||
| Net loss per share: | |||||||||||||||
| Basic and diluted | $ | (0.24 | ) | $ | (0.75 | ) | $ | (0.94 | ) | $ | (2.84 | ) | |||
| Weighted average shares outstanding: | |||||||||||||||
| Basic and diluted | 90.9 | 81.9 | 90.5 | 81.6 | |||||||||||
| MYRIAD GENETICS, INC. AND SUBSIDIARIES Condensed Consolidated Balance Sheets (unaudited) (in millions) | |||||||
| September 30, 2024 | December 31, 2023 | ||||||
| ASSETS | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 99.9 | $ | 132.1 | |||
| Marketable investment securities | — | 8.8 | |||||
| Trade accounts receivable | 125.7 | 114.3 | |||||
| Inventory | 26.2 | 22.0 | |||||
| Prepaid taxes | 17.0 | 17.0 | |||||
| Prepaid expenses and other current assets | 24.4 | 19.4 | |||||
| Total current assets | 293.2 | 313.6 | |||||
| Operating lease right-of-use assets | 57.4 | 61.6 | |||||
| Property, plant and equipment, net | 115.4 | 119.0 | |||||
| Intangibles, net | 312.5 | 349.5 | |||||
| Goodwill | 286.3 | 287.4 | |||||
| Other assets | 16.5 | 15.4 | |||||
| Total assets | $ | 1,081.3 | $ | 1,146.5 | |||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
| Current liabilities: | |||||||
| Accounts payable | 29.6 | 25.8 | |||||
| Accrued liabilities | 111.2 | 113.9 | |||||
| Current maturities of operating lease liabilities | 13.5 | 16.2 | |||||
| Total current liabilities | 154.3 | 155.9 | |||||
| Unrecognized tax benefits | 31.4 | 30.2 | |||||
| Long-term debt | 39.0 | 38.5 | |||||
| Noncurrent operating lease liabilities | 90.6 | 97.4 | |||||
| Other long-term liabilities | 34.3 | 41.3 | |||||
| Total liabilities | 349.6 | 363.3 | |||||
| Commitments and contingencies | |||||||
| Stockholders’ equity: | |||||||
| Common stock, 91.0 and 89.9 shares outstanding at September 30, 2024 and December 31, 2023, respectively | 0.9 | 0.9 | |||||
| Additional paid-in capital | 1,445.2 | 1,415.5 | |||||
| Accumulated other comprehensive loss | (0.1 | ) | (3.7 | ) | |||
| Accumulated deficit | (714.3 | ) | (629.5 | ) | |||
| Total stockholders' equity | 731.7 | 783.2 | |||||
| Total liabilities and stockholders’ equity | $ | 1,081.3 | $ | 1,146.5 | |||
| MYRIAD GENETICS, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Cash Flows (unaudited) (in millions) | |||||||||||||||
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Net cash provided by (used in) operating activities | $ | 0.7 | $ | (22.1 | ) | $ | (15.3 | ) | $ | (56.2 | ) | ||||
| Net cash provided by (used in) investing activities | 7.5 | (2.5 | ) | (6.0 | ) | 43.9 | |||||||||
| Net cash provided by (used in) financing activities | (3.1 | ) | (2.5 | ) | (9.5 | ) | 31.0 | ||||||||
| Effect of foreign exchange rates on cash, cash equivalents, and restricted cash | 1.2 | (0.6 | ) | (0.3 | ) | (0.1 | ) | ||||||||
| Change in cash and cash equivalents classified as held for sale(1) | 2.3 | — | — | — | |||||||||||
| Net increase (decrease) in cash, cash equivalents, and restricted cash | 8.6 | (27.7 | ) | (31.1 | ) | 18.6 | |||||||||
| Cash, cash equivalents, and restricted cash at beginning of the period | 101.2 | 112.7 | 140.9 | 66.4 | |||||||||||
| Cash, cash equivalents, and restricted cash at end of the period | $ | 109.8 | $ | 85.0 | $ | 109.8 | $ | 85.0 | |||||||
| (1) The change is associated with the divestiture of the EndoPredict business that was completed during the three months ended September 30, 2024, that was classified as held for sale at June 30, 2024. | |||||||||||||||
Safe Harbor Statement
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including the company's updated fiscal year 2024 financial guidance, statements relating to the company’s product pipeline and how these new products, once commercialized, have the potential to address a number of large market opportunities where the company believes it will have highly differentiated proprietary solutions, providing the company with opportunities to accelerate growth going forward, and statements about UnitedHealthcare's recent decision to no longer provide coverage for certain multi-gene panel pharmacogenetic tests, such as GeneSight, under its commercial and individual exchange benefit plans, effective January 1, 2025, and the company's continued engagement with UnitedHealthcare to find a positive resolution for patients, including continued access to GeneSight. These “forward-looking statements” are management’s present expectations of future events as of the date hereof and are subject to a number of known and unknown risks and uncertainties that could cause actual results, conditions, and events to differ materially and adversely from those anticipated.
These risks include, but are not limited to: the risk that sales and profit margins of the company’s existing tests may decline; the risk that the company may not be able to operate its business on a profitable basis; risks related to the company’s ability to achieve certain revenue growth targets and generate sufficient revenue from its existing product portfolio or in launching and commercializing new tests to be profitable; risks related to changes in governmental or private insurers’ coverage and reimbursement levels for the company’s tests or the company’s ability to obtain reimbursement for its new tests at comparable levels to its existing tests, including risks to the company's business and financial results associated with UnitedHealthcare's recent update to its medical policy for pharmacogenetic testing to no longer provide coverage for certain multi-gene panel pharmacogenetic tests, such as GeneSight, under its commercial and individual exchange benefit plans, effective January 1, 2025, and the company's pursuit of a resolution with respect thereto that may benefit the company and patients that could benefit from GeneSight; risks related to increased competition and the development of new competing tests; the risk that the company may be unable to develop or achieve commercial success for additional tests in a timely manner, or at all; the risk that the company may not successfully develop new markets or channels for its tests; the risk that licenses to the technology underlying the company’s tests and any future tests are terminated or cannot be maintained on satisfactory terms; risks related to delays or other problems with operating the company’s laboratory testing facilities and the transition of such facilities to the company's new laboratory testing facilities; risks related to public concern over genetic testing in general or the company’s tests in particular; risks related to regulatory requirements or enforcement in the United States and foreign countries and changes in the structure of the healthcare system or healthcare payment systems; risks related to the company’s ability to obtain new corporate collaborations or licenses and acquire or develop new technologies or businesses on satisfactory terms, if at all; risks related to the company’s ability to successfully integrate and derive benefits from any technologies or businesses that it licenses, acquires or develops; the risk that the company is not able to secure additional financing to fund its business, if needed, in a timely manner or on favorable terms, if it all; risks related to the company’s projections or estimates about the potential market opportunity for the company’s current and future products; the risk that the company or its licensors may be unable to protect or that third parties will infringe the proprietary technologies underlying the company’s tests; the risk of patent-infringement claims or challenges to the validity of the company’s patents; risks related to changes in intellectual property laws covering the company’s tests, or patents or enforcement, in the United States and foreign countries; risks related to security breaches, loss of data and other disruptions, including from cyberattacks; risks of new, changing and competitive technologies in the United States and internationally and that the company may not be able to keep pace with the rapid technology changes in its industry, or properly leverage new technologies to achieve or sustain competitive advantages in its products; the risk that the company may be unable to comply with financial or operating covenants under the company’s credit or lending agreements; the risk that the company may not be able to maintain effective disclosure controls and procedures and internal control over financial reporting; risks related to current and future investigations, claims or lawsuits, including derivative claims, product or professional liability claims, and risks related to the amount of the company's insurance coverage limits and scope of insurance coverage with respect thereto; and other factors discussed under the heading “Risk Factors” contained in Item 1A of the company’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (SEC) on February 28, 2024 as updated in the company's Quarterly Report on Form 10-Q filed with the SEC on May 8, 2024, as well as any further updates to those risk factors filed from time to time in the company’s Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. Myriad Genetics is not under any obligation, and it expressly disclaims any obligation, to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise except as required by law.
Statement regarding use of non-GAAP financial measures
In this press release, the company’s financial results and financial guidance are provided in accordance with accounting principles generally accepted in the United States (GAAP) and using certain non-GAAP financial measures. Management believes that presentation of operating results using non-GAAP financial measures provides useful supplemental information to investors and facilitates the analysis of the company’s core operating results and comparison of operating results across reporting periods. Management also uses non-GAAP financial measures to establish budgets and to manage the company’s business. A reconciliation of the GAAP financial results to non-GAAP financial results is included in the schedules below and a description of the adjustments made to the GAAP financial measures is included at the end of the schedules.
The company encourages investors to carefully consider its results under GAAP, as well as its supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand its business. Non-GAAP financial results are reported in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP.
The company does not forecast GAAP operating expenses, net income (loss) or earnings per share because it cannot predict certain elements that are included in reported GAAP results. Please see above under “Financial Guidance” for a full explanation.
Reconciliation of GAAP to Non-GAAP Financial Measures
for the Three and Nine Months Ended September 30, 2024 and 2023
(unaudited data in millions, except per share amounts)
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Adjusted Gross Margin | |||||||||||||||
| Gross Profit (1) | $ | 149.8 | $ | 134.3 | $ | 434.5 | $ | 382.0 | |||||||
| Acquisition - amortization of intangible assets | 0.3 | 0.4 | 0.9 | 1.1 | |||||||||||
| Equity compensation | 0.3 | 0.4 | 1.2 | 1.0 | |||||||||||
| Transformation initiatives | — | — | — | 0.2 | |||||||||||
| Other adjustments | 0.1 | — | 0.5 | — | |||||||||||
| Adjusted Gross Profit | $ | 150.5 | $ | 135.1 | $ | 437.1 | $ | 384.3 | |||||||
| Adjusted Gross Margin | 70.6 | % | 70.4 | % | 69.7 | % | 69.0 | % | |||||||
| (1) Consists of total revenues less cost of testing revenue from the Condensed Consolidated Statements of Operations. | |||||||||||||||
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Adjusted Operating Expenses | |||||||||||||||
| Operating Expenses (1) | $ | 169.8 | $ | 194.4 | $ | 519.0 | $ | 608.0 | |||||||
| Acquisition - amortization of intangible assets | (10.0 | ) | (10.3 | ) | (30.6 | ) | (31.0 | ) | |||||||
| Goodwill and long-lived asset impairment charges | (2.2 | ) | — | (13.8 | ) | — | |||||||||
| Equity compensation | (12.0 | ) | (11.3 | ) | (37.6 | ) | (29.2 | ) | |||||||
| Real estate optimization | (2.0 | ) | (2.7 | ) | (5.5 | ) | (13.7 | ) | |||||||
| Transformation initiatives | (2.6 | ) | (0.1 | ) | (6.6 | ) | (6.9 | ) | |||||||
| Legal charges, net of insurance reimbursement | — | (35.1 | ) | (0.5 | ) | (113.3 | ) | ||||||||
| Other adjustments | — | 2.4 | (3.5 | ) | 1.6 | ||||||||||
| Adjusted Operating Expenses | $ | 141.0 | $ | 137.3 | $ | 420.9 | $ | 415.5 | |||||||
| (1) Consists of research and development expense and selling, general and administrative expense, goodwill and lived-asset impairment charges, and legal settlements from the Condensed Consolidated Statements of Operations. | |||||||||||||||
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Adjusted Operating Income (Loss) | |||||||||||||||
| Operating Loss | $ | (20.0 | ) | $ | (60.1 | ) | $ | (84.5 | ) | $ | (226.0 | ) | |||
| Acquisition - amortization of intangible assets | 10.3 | 10.7 | 31.5 | 32.0 | |||||||||||
| Goodwill and long-lived asset impairment charges | 2.2 | — | 13.8 | — | |||||||||||
| Equity compensation | 12.3 | 11.7 | 38.9 | 30.3 | |||||||||||
| Real estate optimization | 2.0 | 2.7 | 5.5 | 13.7 | |||||||||||
| Transformation initiatives | 2.6 | 0.1 | 6.6 | 7.1 | |||||||||||
| Legal charges, net of insurance reimbursement | — | 35.1 | 0.5 | 113.3 | |||||||||||
| Other adjustments | 0.1 | (2.4 | ) | 3.9 | (1.6 | ) | |||||||||
| Adjusted Operating Income (Loss) | $ | 9.5 | $ | (2.2 | ) | $ | 16.2 | $ | (31.2 | ) | |||||
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Adjusted Net Income (Loss) (1) | |||||||||||||||
| Net Loss | $ | (22.1 | ) | $ | (61.3 | ) | $ | (84.8 | ) | $ | (232.1 | ) | |||
| Acquisition - amortization of intangible assets | 10.3 | 10.7 | 31.5 | 32.0 | |||||||||||
| Goodwill and long-lived asset impairment charges | 2.2 | — | 13.8 | — | |||||||||||
| Equity compensation | 12.3 | 11.7 | 38.9 | 30.3 | |||||||||||
| Real estate optimization | 2.0 | 2.7 | 5.5 | 13.7 | |||||||||||
| Transformation initiatives | 2.6 | 0.1 | 6.6 | 7.1 | |||||||||||
| Legal charges, net of insurance reimbursement | — | 35.1 | 0.5 | 113.3 | |||||||||||
| Other adjustments | 0.1 | (1.7 | ) | 2.5 | — | ||||||||||
| Tax adjustments | (2.1 | ) | 0.4 | (5.2 | ) | 9.6 | |||||||||
| Adjusted Net Income (Loss) | $ | 5.3 | $ | (2.3 | ) | $ | 9.3 | $ | (26.1 | ) | |||||
| Weighted average shares outstanding: | |||||||||||||||
| Basic | 90.9 | 81.9 | 90.5 | 81.6 | |||||||||||
| Diluted | 92.6 | 81.9 | 91.9 | 81.6 | |||||||||||
| Adjusted Earnings (Loss) Per Share | |||||||||||||||
| Basic | $ | 0.06 | $ | (0.03 | ) | $ | 0.10 | $ | (0.32 | ) | |||||
| Diluted | $ | 0.06 | $ | (0.03 | ) | $ | 0.10 | $ | (0.32 | ) | |||||
| (1) To determine Adjusted Earnings (Loss) Per Share, or adjusted EPS. | |||||||||||||||
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Adjusted EBITDA | |||||||||||||||
| Net Loss | $ | (22.1 | ) | $ | (61.3 | ) | $ | (84.8 | ) | $ | (232.1 | ) | |||
| Acquisition - amortization of intangible assets | 10.3 | 10.7 | 31.5 | 32.0 | |||||||||||
| Depreciation expense | 4.4 | 3.5 | 13.2 | 9.1 | |||||||||||
| Goodwill and long-lived asset impairment charges | 2.2 | — | 13.8 | — | |||||||||||
| Equity compensation | 12.3 | 11.7 | 38.9 | 30.3 | |||||||||||
| Real estate optimization(1) | 2.0 | 2.7 | 5.5 | 13.7 | |||||||||||
| Transformation initiatives | 2.6 | 0.1 | 6.6 | 7.1 | |||||||||||
| Legal charges, net of insurance reimbursement | — | 35.1 | 0.5 | 113.3 | |||||||||||
| Interest expense, net of interest income(2) | 0.4 | 0.4 | 0.7 | 0.2 | |||||||||||
| Other adjustments | 1.1 | (1.6 | ) | 3.6 | 2.9 | ||||||||||
| Income tax expense(3) | 0.9 | 0.1 | 0.4 | 2.2 | |||||||||||
| Adjusted EBITDA | $ | 14.1 | $ | 1.4 | $ | 29.9 | $ | (21.3 | ) | ||||||
| (1) Real estate optimization includes depreciation expense of | |||||||||||||||
| (2) Derived from interest expense and interest income from the Condensed Consolidated Statements of Operations. | |||||||||||||||
| (3) Derived from income tax (benefit) from the Condensed Consolidated Statement of Operations. | |||||||||||||||
Adjusted Free Cash Flow Reconciliation
for the Three and Nine Months Ended September 30, 2024 and 2023
(unaudited data in millions)
| Three months ended September 30, | Nine months ended September 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Adjusted free cash flow | |||||||||||||||
| Cash flow from operations | $ | 0.7 | $ | (26.6 | ) | $ | (15.3 | ) | $ | (56.2 | ) | ||||
| Real estate optimization | 2.5 | 2.7 | 11.7 | 8.0 | |||||||||||
| Transformation initiatives | 2.6 | 0.1 | 6.6 | 7.1 | |||||||||||
| Legal charges, net of insurance reimbursement | — | 21.1 | 0.6 | 23.3 | |||||||||||
| Contingent consideration payment | — | — | 5.8 | — | |||||||||||
| Other adjustments | — | — | 3.5 | 0.4 | |||||||||||
| Adjusted operating cash flow | $ | 5.8 | $ | (2.7 | ) | $ | 12.9 | $ | (17.4 | ) | |||||
| Capital expenditures | (3.5 | ) | (10.9 | ) | (15.4 | ) | (53.2 | ) | |||||||
| Capitalization of internal-use software costs | (2.8 | ) | (2.1 | ) | (8.4 | ) | (6.6 | ) | |||||||
| Adjusted free cash flow | $ | (0.5 | ) | $ | (15.7 | ) | $ | (10.9 | ) | $ | (77.2 | ) | |||
Following is a description of the adjustments made to GAAP financial measures:
- Acquisition – amortization of intangible assets – represents recurring amortization charges resulting from the acquisition of intangible assets.
- Goodwill and long-lived asset impairment charges – for the three and nine months ended September 30, 2024, primarily the impairment of assets held for sale related to the sale of the EndoPredict business to Eurobio Scientific.
- Equity compensation – non-cash equity-based compensation provided to Myriad Genetics employees and directors.
- Real estate optimization – costs related to real estate initiatives. Prior to the fourth quarter 2023 reporting period, these costs were included in the transformation initiatives category. With respect to the adjusted free cash flow reconciliation, the cash flow effect of real estate optimizations excludes non-cash items such as accelerated depreciation and the cash impact of items previously expensed. These costs include the following:
- For the three months ended September 30, 2024, additional rent as a result of the build-out of our new laboratories in Salt Lake City, Utah, and South Francisco, California, while maintaining our current laboratories in those locations and testing and set-up costs for equipment in our new facilities.
- For the three months ended September 30, 2023, rent expense on abandoned facilities and additional rent as a result of the build-out of our new laboratories in Salt Lake City, Utah, and South San Francisco, California, while maintaining our current laboratories in those locations.
- For the nine months ended September 30, 2024, additional rent as a result of the build-out of our new laboratories in Salt Lake City, Utah, and South Francisco, California, while maintaining our current laboratories in those locations and testing and set-up costs for equipment in our new facilities, lease terminations gains, net of lease termination losses, impairment charges and other abandonment costs.
- For the nine months ended September 30, 2023, accelerated depreciation in connection with our decision to cease the use of our former corporate headquarters in Salt Lake City, Utah, and additional rent as a result of the build-out of our new laboratories in Salt Lake City, Utah, and South San Francisco, California, while maintaining our current laboratories in those locations.
- Transformation initiatives – costs related to transformation initiatives including:
- For the three and nine months ended September 30, 2024, consulting and professional fees.
- For the three and nine months ended September 30, 2023, consulting and professional fees and severance costs related to restructuring.
- Legal charges, net of insurance reimbursement – one-time legal expenses, net of insurance reimbursement. With respect to the adjusted free cash flow reconciliation, the cash flow effect includes cash paid for settlements in the related period.
- Tax adjustments – tax expense (benefit) due to non-GAAP adjustments, differences between stock compensation recorded for book purposes as compared to the allowable tax deductions, and valuation allowance recognized against federal and state deferred tax assets in the United States.
- As of September 30, 2024, a valuation allowance of
$63.1 million was not recognized for non-GAAP purposes given our historical and forecasted positive earnings performance. - As of September 30, 2023, a valuation allowance of
$47.3 million was not recognized for non-GAAP purposes given our historical and forecasted positive earnings performance. - For purposes of adjusted EBITDA, the income tax expense adjustment includes the income tax expense (benefit) recognized in the financial statements.
- As of September 30, 2024, a valuation allowance of
- Depreciation expense - depreciation expense recognized on our fixed assets.
- Contingent consideration payment – for the nine months ended September 30, 2024, the payment of contingent consideration related to the previous acquisition of Sividon Diagnostics GmbH.
- Other adjustments – other one-time non-recurring expenses including:
- For the three months ended September 30, 2024, changes in severance and other consulting costs.
- For the three months ended September 30, 2023, primarily includes changes in the fair value of contingent consideration related to acquisitions from prior years and the reclassifications of cumulative translation adjustments to income upon liquidation of an investment in a foreign entity.
- For the nine months ended September 30, 2024, primarily includes a gain recognized on acquisition, changes in the fair value of contingent consideration related to acquisitions from prior years, the reclassifications of cumulative translation adjustments to income upon liquidation of an investment in a foreign entity, severance, and costs incurred in connection with executive personnel changes.
- For the nine months ended September 30, 2023, changes in the fair value of contingent consideration related to acquisitions from prior years, the reclassifications of cumulative translation adjustments to income upon liquidation of an investment in a foreign entity, and consulting and professional fees related to prior year acquisitions.
- For purposes of adjusted EBITDA, other adjustments include the items listed above as well as amounts included in other income/expense in the financial statements.
| Media Contact: | Glenn Farrell | Investor Contact: | Matt Scalo |
| (385) 318-3718 | (801) 584-3532 | ||
| PR@myriad.com | matt.scalo@myriad.com |
FAQ
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