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SALT LAKE CITY, Aug. 03, 2023 (GLOBE NEWSWIRE) -- Myriad Genetics, Inc. (NASDAQ: MYGN), a leader in genetic testing and precision medicine, today announced financial results for its second quarter ended June 30, 2023. The Company also provided an update on its business performance and 2023 financial guidance. “Strong double-digit test volume growth in the second quarter of 2023 continues to reflect greater adoption by providers as we continue to emerge from the pandemic restrictions on access and Myriad’s improved commercial execution across our businesses. We're pleased with ongoing share gains in our hereditary cancer testing franchise, particularly the 21% year-over-year volume growth in Women's Health," said Paul J. Diaz, president and CEO, Myriad Genetics. "Excluding changes in estimated revenue, Myriad generated 10% year-over-year revenue growth in the second quarter of 2023, even as the company, and the diagnostics lab industry, continue to work through challenging payor dynamics that negatively impacted our second quarter revenue by approximately $4 million. We believe these dynamics are largely transitory and we remain focused on working collaboratively with payers to support reimbursement for the services we provide to healthcare providers and their patients." Mr. Diaz concluded, “In the second quarter of 2023, we generated strong gross margins, managed operating expenses and improved our financial flexibility by executing on a new credit facility. We remain confident in our ability to achieve our goal of adjusted profitability by the fourth quarter and sustainable 10%+ annual revenue growth."
Financial and Operational Highlights:
Business Performance and Highlights:
OncologyThe Myriad Genetics Oncology business provides hereditary cancer testing, including the MyRisk® hereditary cancer test for patients who have cancer. It also provides tumor profiling products such as the myChoice® CDx companion diagnostic test, the Prolaris® prostate cancer test, Precise™ Tumor molecular profile test and the EndoPredict® breast cancer prognostic test. The Oncology business delivered revenue of $80.7 million in the second quarter of 2023.
Women’s HealthThe Myriad Genetics Women’s Health business serves women of all ancestries by assessing their risk of cancer and offers prenatal testing solutions for those who are pregnant or planning a family. The Women’s Health business delivered revenue of $67.6 million in the second quarter of 2023.
Mental HealthThe Myriad Genetics Mental Health business consists of the GeneSight test that covers 64 medications commonly prescribed for depression, anxiety, attention deficit hyperactivity disorder, and other psychiatric conditions. GeneSight helps physicians understand how genetic alterations impact patient response to antidepressants and other drugs. In the pharmacogenomics category, the GeneSight test recorded revenue of $35.2 million in the second quarter of 2023.
Securities Class Action SettlementMyriad Genetics reached an agreement to settle the securities class-action lawsuit, In re Myriad Genetics, Inc. Securities Litigation, 2:19-cv-00707-JNP-DBP (D. Utah). The settlement, if approved by the United States District Court for the District of Utah, will resolve all claims brought by the plaintiff Los Angeles Fire and Police Pensions Fund, without Myriad Genetics making an admission or the finding of fault, liability, or wrongdoing by Myriad Genetics or any current and former Myriad Genetics employees. Pursuant to the terms of the settlement, Myriad Genetics has agreed to pay a settlement amount of $77.5 million, consisting of at least $20 million in cash to be paid in the third quarter of 2023, and, at Myriad Genetics’ sole election, the remaining $57.5 million in either shares of Myriad Genetics common stock or cash, or a combination thereof, upon the final court approval of the settlement, which is expected to occur in the first quarter of 2024. The company intends to pay the majority of the settlement amount in cash from its cash on hand, operating cash flow and asset based credit facility. Additional details can be found on the Current Report on Form 8-K filed with the Securities and Exchange Commission on August 3, 2023.
Liquidity and Cash FlowIn the second quarter, Myriad established a new $90 million asset-based credit facility (the “ABL Facility”) with JPMorgan Chase Bank, N.A., Wells Fargo Bank, N.A. and Bank of America, N.A. The ABL Facility includes an option to increase the maximum principal amount by up to $25 million for a total of $115 million. The ABL Facility replaces the Company’s previous credit facility and matures on June 30, 2026.
2023 Investor Event Myriad Genetics will host its 2023 Investor Event at the Dr. Walter Gilbert Innovation Center in South San Francisco on September 19, 2023. The event will commence with a facility tour beginning at 12:00 p.m. EDT followed by a management presentation and Q&A from 1:00 p.m. to 3:00 p.m. EDT. For those unable to attend in person, a webcast will be available at the investor site on www.myriad.com.
Background on Walter Gilbert, Ph.D.Walter Gilbert, Ph.D, a molecular biology pioneer and co-founder of Myriad Genetics served on the Board of Directors for 28 years and was the company’s first Chairman of the Board. An early proponent of sequencing the human genome, Dr. Gilbert joined Myriad as a founding scientist in 1992 and served in numerous leadership roles which positively impacted the strategic direction and growth of the company. Leading up to his work at Myriad Genetics, Dr. Gilbert won the Nobel Prize in Chemistry in 1980 for his contributions to the development of DNA sequencing technology. He also was a founder of Biogen, Inc. and its Chairman of the Board and Chief Executive Officer from 1981 to 1985, as well as the Carl M. Loeb University Professor at Harvard University.
Financial GuidanceMyriad Genetics reaffirms its 2023 revenue and non-GAAP financial guidance and updates its other GAAP financial guidance to account for the pending settlement of the securities class action lawsuit, as stated in the table below.*
Myriad Genetics' fiscal year 2023 non-GAAP guidance begins with the comparable GAAP financial measure and excludes the estimated impact of stock-based compensation expense of approximately $40.0 million, non-cash amortization associated with acquisitions of approximately $43.0 million and special items such as costs related to transformation initiatives of approximately $24.0 million, legal settlement costs of approximately $80 million, and tax adjustments of approximately $8.0 million.
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 WebcastA conference call will be held today, Thursday, August 3, 2023, at 4:30 p.m. EDT to discuss Myriad Genetics’ financial results and business developments for the second quarter 2023. The dial-in number for domestic callers is 1-800-954-0653. International callers may dial 1-212-231-2921. All callers will be asked to reference reservation number 22027563. An archived replay of the call will be available for seven days by dialing 1-800-633-8284 and entering the reservation number above. The conference call and slide presentation will be available through a live webcast at www.myriad.com.
About Myriad GeneticsMyriad 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, ColarisAP, MyRisk, Myriad myRisk, MyRisk Hereditary Cancer, myChoice, Tumor BRACAnalysis CDx, MyChoice CDx, Prequel, Prequel with Amplify, Amplify, Foresight, Precise, FirstGene, SneakPeek, SneakPeek Early Gender DNA Test, Health.Illuminated., RiskScore, Prolaris, GeneSight, and EndoPredict are registered trademarks or trademarks of Myriad Genetics, Inc.. All third-party marks—® and ™—are the property of their respective owners. © 2023 Myriad Genetics, Inc. All rights reserved.
Revenue by Product (Unaudited):
Business Units:WH = Women’s HealthONC = OncologyMH = Mental Health
Product Categories:Hereditary Cancer – MyRisk, BRACAnalysis, BRACAnalysis CDxTumor Profiling – myChoice CDx, Prolaris, EndoPredictPrenatal – Foresight, Prequel, SneakPeekPharmacogenomics – GeneSight
MYRIAD GENETICS, INC.AND SUBSIDIARIESCondensed Consolidated Statements of Operations(in millions, except per share amounts)
MYRIAD GENETICS, INC.AND SUBSIDIARIESCondensed Consolidated Balance Sheets(in millions, except share information)
MYRIAD GENETICS, INC.AND SUBSIDIARIESCondensed Consolidated Statements of Cash Flows(in millions)
Safe Harbor StatementThis 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 2023 financial guidance, the company's goal of adjusted profitability by the fourth quarter of 2023 and sustainable 10%+ annual revenue growth, statements relating to the securities class action settlement subject to court approval, including the expected timing of the initial $20 million cash payment in the third quarter of 2023 and the payment of the remaining $57.5 million in the first quarter of 2024, and the company's intention to pay the majority of the settlement amount in cash from its cash on hand, operating cash flow and asset based credit facility, the company's expected capital expenditures and cash flow from operations for the second half of 2023, and the company's estimated total available cash and credit at year end 2023. 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 or 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; risks related to increased competition and the development of new competing tests; continued uncertainties associated with COVID-19, including its possible effects on the company's operations and the demand for its products; 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, including the company’s ability to successfully generate substantial revenue outside the United States; 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 constructing and operating the company’s 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 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 operating covenants under the company’s credit or lending agreements; risks related to the company’s inability to achieve and 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, including the risk that the court does not approve the settlement of the class action lawsuit, 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 March 1, 2023 as updated in the company's Quarterly Report on Form 10-Q filed with the SEC on May 4, 2023, 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 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 measuresIn 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.
Reconciliation of GAAP to Non-GAAP Financial Measuresfor the Three and Six Months ended June 30, 2023 and 2022(unaudited data in millions, except per share amounts)
Adjusted Free Cash Flow Reconciliationfor the Three and Six Months Ended June 30, 2023 and 2022(unaudited data in millions)
Following is a description of the adjustments made to GAAP financial measures:
1 Change of estimates may include both positive and negative adjustments primarily driven by changes in the estimated transaction price due to contractual adjustments, actual cash collections, and obtaining updated information from payors and patients that was unknown at the time revenue was recognized.