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| Invitae CEO and co-founder Randy Scott |
It's a good time to be in the genetic testing business, as Invitae ($NVTA) knows well. The company posted second-quarter revenues that beat last year's numbers and is forecasting more success in the year to come, carving out a niche in the market months after filing for an IPO.
The San Francisco, CA-based testing outfit is upping its guidance for billable tests delivered in 2015 to 16,000 to 18,000, significantly higher than its previous guidance of 14,000 to 17,000 billable tests. The move comes amid positive Q2 results, as Invitae roped in $1.8 million in revenue for the quarter--a 47% jump over Q1 and more than 6 times the revenue the company brought in during the same quarter last year. And Invitae boosted its testing volume with more than 4,400 billable reports, a 90% jump over Q1.
With promising results in tow, Invitae will take "an aggressive approach" to besting its competition, CEO Randy Scott said in a statement. Part of that will involve bolstering its offerings. The company already has an assay of 216 genes comprising 85 genetic disorders and 17 panels focused on hereditary cancers including breast, ovarian, colon and pancreatic. Earlier this year, Invitae said it planned to surpass the 500-gene mark in its genetic testing menu, and the company achieved this goal during Q2. Now, Invitae is shooting to add 500 genes during the first half of 2016, resulting in a test menu of more than 1,000 genes with tests for less than $1,000 a pop.
"We're now moving into a new chapter for the company, focused on the path to profitability," Scott said. "We believe our investment in scaling up our production--and especially our medical interpretation capabilities--will enable us to deliver more than 1,000 genes for under $1,000 per indication in the first half of 2016, accelerating our mission to make comprehensive genetic testing a part of mainstream medical practice for billions of people."
Meanwhile, Invitae is working hard to set itself apart from the competition following a 2013 U.S. Supreme Court ruling that found Myriad Genetics' ($MYGN) patents for DNA invalid. The move opened the door for increased rivalry in the market, and Invitae has not wasted any time vying for its share. In February, the company raised $102 million in an IPO priced well above its range. In June, the company announced it would cut prices for its genetic tests, planning to offer its products at a patient price of $475 rather than $1,500. And payers who have contracts with Invitae will pay $950 for the tests, providing a more cost-effective model than those laid out by rivals.
"With the Supreme Court decisions regarding DNA patents, the declining cost of sequencing, and the recent data that we've published, the genetics field has been opened to disruption and has transformed into a market in which high-quality, high-value services delivered at scale will win," Invitae COO Sean George said in a statement. "Given our team, our investment in our infrastructure, and our progress to date, we expect to be the leader in this new competitive marketplace."
- read Invitae's statement