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November 05, 2020

Invitae Reports $68.7 Million in Revenue Driven by 170,000 Samples Accessioned in the Third Quarter of 2020

-- Strong results driven by comprehensive menu, customer relationships and consistent execution --
-- Landmark data supporting universal genetic testing in cancer and the utility of germline and somatic testing to improve patient management published --
-- Hosting conference call and webcast today at 4:30pm Eastern/1:30pm Pacific --

SAN FRANCISCO, Nov. 5, 2020 /PRNewswire/ -- Invitae Corporation (NYSE: NVTA), a leading medical genetics company, today announced financial and operating results for the third quarter ended September 30, 2020.

"Strategic, commercial and operating results in the third quarter continued to demonstrate the value and leverage available from our global, diversified business. These strong results are a testament to our unique combination of comprehensive menu, durable customer relationships and ability to execute," said Sean George, Ph.D., co-founder and chief executive officer of Invitae. "We further advanced clinical understanding of the importance of genetic information with the publication of several studies, including a collaboration supporting universal testing for cancer patients. Looking ahead, we believe recent acquisitions and integrations, coupled with our internal development efforts, will provide access to new and developing markets and improve ease-of-use for customers, enhancing our ability to meet the needs of patients and clinicians as the use of genetics in healthcare continues to accelerate."  

Third Quarter 2020 Financial Results

  • Accessioned approximately 170,000 samples in the third quarter of 2020 compared to 129,000 samples in the third quarter of 2019. Billable volume was approximately 157,000 in the third quarter of 2020
  • Generated revenue of $68.7 million in the third quarter of 2020 compared to $56.5 million in revenue in the third quarter of 2019
  • Reported average cost per sample of $274 in the third quarter of 2020 compared to $249 average cost per sample in the third quarter of 2019. Non-GAAP average cost per sample was $247 in the third quarter of 2020
  • Achieved gross profit of $22.1 million in the third quarter of 2020 compared to $24.4 million of gross profit in the third quarter of 2019. Non-GAAP gross profit was $26.8 million in the third quarter of 2020

Total operating expense, excluding cost of revenue, for the third quarter of 2020 was $102.9 million. Non-GAAP operating expense was $102.6 million in the third quarter of 2020.

Net loss for the third quarter of 2020 was $102.9 million, or $0.78 net loss per share, compared to a net loss of $78.7 million in the third quarter of 2019, or $0.82 net loss per share. Non-GAAP net loss was $81.7 million, or $0.62 non-GAAP net loss per share, in the third quarter of 2020.

At September 30, 2020, cash, cash equivalents, restricted cash and marketable securities totaled $368.0 million. Net decrease in cash, cash equivalents and restricted cash for the quarter was $61.4 million. Cash burn was $64.9 million for the quarter.

Corporate and Scientific Highlights

  • Completed the transaction to bring ArcherDX, a leading genomics analysis company, into Invitae to create a global leader in comprehensive cancer genetics and precision oncology, bringing germline and somatic testing, liquid biopsy and tissue genomic profiling onto a single platform. With both centralized and distributed capabilities, Invitae is now uniquely positioned to provide flexibility in meeting customers' needs.  
  • Published significant studies underscoring the use of both germline and somatic sequencing in oncology:
    • A multi-year collaboration with researchers at Mayo Clinic published in JAMA Oncology evaluated universal germline genetic testing for solid tumor cancer patients. The study found one in eight patients with cancer had an inherited, cancer-related gene mutation, half of whom would not have been detected using a standard guidelines based approach and one-third of whom had their therapy changed as a result of their genetics. The data support changing the standard of care to include germline genetic testing for all solid tumor cancer patients.
    • A study published in JAMA Network Open showing tumor-only genetic sequencing misses medically actionable genetic variants in cancer patients that germline genetic tests identify, suggesting the use of both tumor and germline testing to provide the most complete and actionable genetic profiling to inform cancer treatment.
    • Data presented at the American Society of Human Genetics annual meeting, showed one in ten men with prostate cancer harbored genetic changes linked to hereditary cancer syndromes and three-quarters of those patients met criteria for changes in their cancer management or treatment based on their genetic findings. Study findings suggest common criteria used to restrict testing would miss clinically important changes for many patients and their families.
  • Began enrollment in a nationwide study to better understand the role of current genetic testing guidelines in ensuring prostate cancer patients receive testing to identify clinically relevant genetic variants that can inform prognosis and support access to targeted therapies.
  • Signed 32 biopharma partnership deals in the quarter.
    • Partnered with Pfizer to offer the BRCA Care genetic testing program, which provides sponsored, no-charge germline BRCA testing for patients diagnosed with HER2-negative locally advanced or metastatic breast cancer in different countries, beginning in Hong Kong, Oman, Qatar, Saudi Arabia, Taiwan and United Arab Emirates.
    • Signed two new partners to the Behind the Seizure program, bringing the total number of biopharma partners in this program to 10.
    • Added two additional partners to Invitae's Detect programs providing no-charge genetic testing for conditions in which testing is underutilized and can improve diagnosis and treatment.
  • Announced the appointment of tech entrepreneur Kimber Lockhart to the company's Board of Directors, noting her expertise and leadership in scaling engineering and digital tools.

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 register for the conference call and webcast, please use one of the methods below. Upon registering, each participant will be provided with call details and a registrant ID.

Online registration: http://www.directeventreg.com/registration/event/7916067

Phone registration: (888) 869-1189 or (706) 643-5902

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.

About Invitae

Invitae Corporation (NYSE: NVTA) is a leading medical genetics company whose mission is to bring comprehensive genetic information into mainstream medicine to improve healthcare for billions of people. Invitae's goal is to aggregate the world's genetic tests into a single service with higher quality, faster turnaround time, and lower prices. For more information, visit the company's website at invitae.com.

Safe Harbor Statement
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the company's belief regarding the value and leverage of its global, diversified business; the company's belief regarding the impact of its unique combination of comprehensive menu, durable customer relationships and ability to execute; the importance of the company's recent studies and collaborations; the company's belief regarding the momentum of its business and ability to continue to deliver on its mission to bring genetic information into mainstream medicine; the impact of the company's acquisitions, including its completed merger with ArcherDX, as well as its internal development efforts, partnerships and product offerings; and the company's beliefs regarding its ability to access new and developing markets, improve ease-of-use for customers, and meet the needs of patients and clinicians. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, and reported results should not be considered as an indication of future performance. These risks and uncertainties include, but are not limited to:  the impact of COVID-19 on the company, and the effectiveness of the efforts it has taken or may take in the future in response thereto; the company's ability to continue to grow its business, including internationally; the company's history of losses; the company's ability to compete; the company's failure to manage growth effectively; the company's need to scale its infrastructure in advance of demand for its tests and to increase demand for its tests; the risk that the company may not obtain or maintain sufficient levels of reimbursement for its tests; the company's failure to successfully integrate or fully realize the anticipated benefits of acquired businesses; risks associated with litigation; the company's ability to use rapidly changing genetic data to interpret test results accurately and consistently; security breaches, loss of data and other disruptions; laws and regulations applicable to the company's business; and the other risks set forth in the company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2020. These forward-looking statements speak only as of the date hereof, and Invitae Corporation disclaims any obligation to update these forward-looking statements.

Non-GAAP Financial Measures
To supplement Invitae's consolidated financial statements prepared in accordance with generally accepted accounting principles in the United States (GAAP), the company is providing several non-GAAP measures, including non-GAAP gross profit, non-GAAP cost of revenue, non-GAAP operating expense, including non-GAAP research and development, non-GAAP selling and marketing, non-GAAP general and administrative and non-GAAP other income (expense), net, as well as non-GAAP net loss and non-GAAP net loss per share and non-GAAP cash burn. These non-GAAP financial measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similarly-titled measures presented by other companies. Management believes these non-GAAP financial measures are useful to investors in evaluating the company's ongoing operating results and trends.

Management is excluding from some or all of its non-GAAP operating results (1) amortization of acquired intangible assets, (2) acquisition-related stock-based compensation, (3) post-combination expense related to the acceleration of equity grants or bonus payments in connection with the company's business combinations, (4) adjustments to the fair value of acquisition-related liabilities and (5) acquisition-related income tax benefits.  These non-GAAP financial measures are limited in value because they exclude certain items that may have a material impact on the reported financial results. Management accounts for this limitation by analyzing results on a GAAP basis as well as a non-GAAP basis and also by providing GAAP measures in the company's public disclosures.

Cash burn excludes (1) changes in marketable securities, (2) cash received from equity financings and (3) cash received from exercises of warrants. Management believes cash burn is a liquidity measure that provides useful information to management and investors about the amount of cash consumed by the operations of the business. A limitation of using this non-GAAP measure is that cash burn does not represent the total change in cash, cash equivalents, and restricted cash for the period because it excludes cash provided by or used for other operating, investing or financing activities. Management accounts for this limitation by providing information about the company's operating, investing and financing activities in the statements of cash flows in the consolidated financial statements in the company's most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K and by presenting net cash provided by (used in) operating, investing and financing activities as well as the net increase or decrease in cash, cash equivalents and restricted cash in its reconciliation of cash burn.

In addition, other companies, including companies in the same industry, may not use the same non-GAAP measures or may calculate these metrics in a different manner than management or may use other financial measures to evaluate their performance, all of which could reduce the usefulness of these non-GAAP measures as comparative measures. Because of these limitations, the company's non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the non-GAAP reconciliations provided in the tables below.

INVITAE CORPORATION


Consolidated Balance Sheets

(in thousands)

(unaudited)



September 30,
2020


December 31,
2019

Assets




Current assets:




Cash and cash equivalents

$

106,436



$

151,389


Marketable securities

254,848



240,436


Accounts receivable

27,328



32,541


Prepaid expenses and other current assets

26,492



18,032


Total current assets

415,104



442,398


Property and equipment, net

46,130



37,747


Operating lease assets

39,007



36,640


Restricted cash

6,685



6,183


Intangible assets, net

187,060



125,175


Goodwill

211,225



126,777


Other assets

7,961



6,681


Total assets

$

913,172



$

781,601


Liabilities and stockholders' equity




Current liabilities:




Accounts payable

$

15,589



$

10,321


Accrued liabilities

77,986



64,814


Operating lease obligations

6,628



4,870


Finance lease obligations

1,237



1,855


Total current liabilities

101,440



81,860


Operating lease obligations, net of current portion

42,363



42,191


Finance lease obligations, net of current portion

1,834



1,155


Convertible senior notes, net

279,870



268,755


Deferred tax liability

10,250




Other long-term liabilities

60,864



8,000


Total liabilities

496,621



401,961






Stockholders' equity:




Common stock

13



10


Accumulated other comprehensive income (loss)

199



(9)


Additional paid-in capital

1,542,848



1,138,316


Accumulated deficit

(1,126,509)



(758,677)


Total stockholders' equity

416,551



379,640


Total liabilities and stockholders' equity

$

913,172



$

781,601


 

INVITAE CORPORATION


Consolidated Statements of Operations

(in thousands, except per share data)

(unaudited)




Three Months Ended
September 30,


Nine Months Ended
September 30,



2020


2019


2020


2019

Revenue:









Test revenue


$

67,326



$

55,502



$

175,503



$

147,423


Other revenue


1,402



1,009



3,664



3,116


Total revenue


68,728



56,511



179,167



150,539


Cost of revenue


46,643



32,120



130,017



81,380


Research and development


37,802



46,951



168,433



90,247


Selling and marketing


37,800



32,690



119,440



87,662


General and administrative


27,306



21,733



81,966



56,326


Loss from operations


(80,823)



(76,983)



(320,689)



(165,076)


Other expense, net


(15,771)



(7,591)



(32,499)



(5,572)


Interest expense


(6,308)



(2,833)



(17,244)



(7,062)


Net loss before taxes


(102,902)



(87,407)



(370,432)



(177,710)


Income tax benefit




(8,700)



(2,600)



(12,650)


Net loss


$

(102,902)



$

(78,707)



$

(367,832)



$

(165,060)


Net loss per share, basic and diluted


$

(0.78)



$

(0.82)



$

(3.08)



$

(1.86)


Shares used in computing net loss per share, basic and diluted


132,484



95,577



119,386



88,663


 

INVITAE CORPORATION


Consolidated Statements of Cash Flows

(in thousands)

(unaudited)



Nine Months Ended September 30,


2020


2019

Cash flows from operating activities:




Net loss

$

(367,832)



$

(165,060)


Adjustments to reconcile net loss to net cash used in operating activities:




Depreciation and amortization

22,964



11,135


Stock-based compensation

102,329



47,826


Amortization of debt discount and issuance costs

11,115



855


Remeasurements of liabilities associated with business combinations

42,448




Benefit from income taxes

(2,600)



(12,650)


Debt extinguishment costs



8,926


Other

(570)



901


Changes in operating assets and liabilities, net of businesses acquired:




Accounts receivable

5,516



(444)


Prepaid expenses and other current assets

(8,460)



(1,424)


Other assets

1,387



2,369


Accounts payable

3,118



87


Accrued expenses and other liabilities

5,665



9,692


Net cash used in operating activities

(184,920)



(97,787)


Cash flows from investing activities:




Purchases of marketable securities

(180,021)



(20,781)


Proceeds from sales of marketable securities

12,832




Proceeds from maturities of marketable securities

152,465



34,500


Acquisition of businesses, net of cash acquired

(57,576)



(9,801)


Purchases of property and equipment

(13,991)



(13,530)


Other

(2,000)




Net cash provided by (used in) investing activities

(88,291)



(9,612)


Cash flows from financing activities:




Proceeds from public offerings of common stock, net

217,489



204,024


Proceeds from issuance of common stock, net

9,076



5,734


Proceeds from issuance of convertible senior notes, net



339,900


Payments of debt extinguishment costs



(10,638)


Loan payments



(75,000)


Finance lease principal payments

(1,543)



(1,590)


Other

3,738




Net cash provided by financing activities

228,760



462,430


Net increase in cash, cash equivalents and restricted cash

(44,451)



355,031


Cash, cash equivalents and restricted cash at beginning of period

157,572



118,164


Cash, cash equivalents and restricted cash at end of period

$

113,121



$

473,195


 

INVITAE CORPORATION


Reconciliation of GAAP to Non-GAAP Cost of Revenue

(in thousands)

(unaudited)




Three Months Ended
September 30,


Nine Months Ended
September 30,



2020


2019


2020


2019

Cost of revenue


$

46,643



$

32,120



$

130,017



$

81,380


Amortization of acquired intangible assets


(4,708)



(1,412)



(12,138)



(2,397)


Non-GAAP cost of revenue


$

41,935



$

30,708



$

117,879



$

78,983


 

Reconciliation of GAAP to Non-GAAP Gross Profit

(in thousands)

(unaudited)




Three Months Ended
September 30,


Nine Months Ended
September 30,



2020


2019


2020


2019

Revenue


$

68,728



$

56,511



$

179,167



$

150,539


Cost of revenue


46,643



32,120



130,017



81,380


Gross profit


22,085



24,391



49,150



69,159


Amortization of acquired intangible assets - cost of revenue


4,708



1,412



12,138



2,397


Non-GAAP gross profit


$

26,793



$

25,803



$

61,288



$

71,556


 

Reconciliation of GAAP to Non-GAAP Research and Development Expense

(in thousands)

(unaudited)




Three Months Ended
September 30,


Nine Months Ended
September 30,



2020


2019


2020


2019

Research and development


$

37,802



$

46,951



$

168,433



$

90,247


Amortization of acquired intangible assets


(117)



(117)



(350)



(350)


Acquisition-related stock-based compensation


171



(18,613)



(52,011)



(21,199)


Acquisition-related post-combination expense


(60)





(60)




Non-GAAP research and development


$

37,796



$

28,221



$

116,012



$

68,698


 

Reconciliation of GAAP to Non-GAAP Selling and Marketing Expense

(in thousands)

(unaudited)




Three Months Ended
September 30,


Nine Months Ended
September 30,



2020


2019


2020


2019

Selling and marketing


$

37,800



$

32,690



$

119,440



$

87,662


Amortization of acquired intangible assets


(760)



(675)



(2,331)



(2,024)


Acquisition-related post-combination expense


(40)





(40)




Non-GAAP selling and marketing


$

37,000



$

32,015



$

117,069



$

85,638


 

INVITAE CORPORATION


Reconciliation of GAAP to Non-GAAP General and Administrative Expense

(in thousands)

(unaudited)




Three Months Ended
September 30,


Nine Months Ended
September 30,



2020


2019


2020


2019

General and administrative


$

27,306



$

21,733



$

81,966



$

56,326


Amortization of acquired intangible assets




(29)



(10)



(86)


Acquisition-related post-combination expense




(2,946)



(500)



(6,158)


Fair value adjustments to acquisition-related liabilities


504





(4,328)




Non-GAAP general and administrative


$

27,810



$

18,758



$

77,128



$

50,082


 

Reconciliation of Operating Expense to Non-GAAP Operating Expense

(in thousands, except per share data)

(unaudited)




Three Months Ended
September 30,


Nine Months Ended
September 30,



2020


2019


2020


2019

Research and development


$

37,802



$

46,951



$

168,433



$

90,247


Selling and marketing


37,800



32,690



119,440



87,662


General and administrative


27,306



21,733



81,966



56,326


Operating expense


102,908



101,374



369,839



234,235


Amortization of acquired intangible assets


(877)



(821)



(2,691)



(2,460)


Acquisition-related stock-based compensation


171



(18,613)



(52,011)



(21,199)


Acquisition-related post-combination expense


(100)



(2,946)



(600)



(6,158)


Fair value adjustments to acquisition-related liabilities


504





(4,328)




Non-GAAP operating expense


$

102,606



$

78,994



$

310,209



$

204,418


 

Reconciliation of Other Income (Expense), Net to Non-GAAP Other Income (Expense), Net

(in thousands, except per share data)

(unaudited)




Three Months Ended
September 30,


Nine Months Ended
September 30,



2020


2019


2020


2019

Other expense, net


$

(15,771)



$

(7,591)



$

(32,499)



$

(5,572)


Fair value adjustments to acquisition-related liabilities


16,208





37,937




Non-GAAP other income (expense), net


$

437



$

(7,591)



$

5,438



$

(5,572)


 

INVITAE CORPORATION


Reconciliation of Net Loss to Non-GAAP Net Loss Per Share

(in thousands, except per share data)

(unaudited)




Three Months Ended
September 30,


Nine Months Ended
September 30,



2020


2019


2020


2019

Net loss


$

(102,902)



$

(78,707)



$

(367,832)



$

(165,060)


Amortization of acquired intangible assets


5,585



2,233



14,829



4,857


Acquisition-related stock-based compensation


(171)



18,613



52,011



21,199


Acquisition-related post-combination expense


100



2,946



600



6,158


Fair value adjustments to acquisition-related liabilities


15,704





42,265




Acquisition-related income tax benefit




(8,700)



(2,600)



(12,650)


Non-GAAP net loss


$

(81,684)



$

(63,615)



$

(260,727)



$

(145,496)











Non-GAAP net loss per share, basic and diluted


$

(0.62)



$

(0.67)



$

(2.18)



$

(1.64)


Shares used in computing net loss per share, basic and diluted


132,484



95,577



119,386



88,663


 

Reconciliation of Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash to Cash Burn

(in thousands)

(unaudited)



Three Months Ended March 31, 2020


Three Months Ended June 30, 2020


Three Months Ended September 30, 2020


Nine Months Ended September 30, 2020





Net cash used in operating activities

$

(62,361)



$

(60,393)



(62,166)




(184,920)


Net cash provided by (used in) investing activities

801



(83,418)



(5,674)




(88,291)


Net cash provided by financing activities

551



221,794



6,415




228,760


Net increase (decrease) in cash, cash equivalents and restricted cash

(61,009)



77,983



(61,425)




(44,451)











Adjustments:









Purchases of investments



115,350



64,671




180,021


Sales of investments

(12,532)





(300)




(12,832)


Maturities of investments

(24,965)



(65,000)



(62,500)




(152,465)


Proceeds from public offering of common stock, net of issuance costs



(217,489)






(217,489)


Prepayment for private placement





(5,000)




(5,000)


Proceeds from exercises of warrants

(27)



(35)



(324)




(386)


Cash burn

$

(98,533)



$

(89,191)



$

(64,878)




(252,602)











• Cash burn for the three months ended March 31, 2020 includes $32.3 million of cash paid in connection with the acquisition of Diploid and cash burn for the three months ended June 30, 2020 includes $25.4 million of cash paid in connection with the acquisitions of Genelex and YouScript.

















 

Contact:
Laura D'Angelo
ir@invitae.com
(628) 213-3369

 

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Email: ir@invitae.com