SAN DIEGO, May 9, 2013 /PRNewswire/ --Sequenom, Inc. (SQNM), a life sciences company providing innovative genetic analysis solutions, today reported revenue of $38.5 million for the first quarter of 2013, an increase of 158% compared to revenue of $14.9 million for the first quarter of 2012. First quarter 2013 revenues from the Sequenom Center for Molecular Medicine (Sequenom CMM) diagnostics services operating segment grew more than 38% as compared to the fourth quarter of 2012.

"The volume of 35,000 MaterniT21 PLUS tests accessioned in the first quarter shows that Sequenom CMM continued to take advantage of its first mover position in the non-invasive prenatal diagnostic (NIPT) market by increasing its penetration of the NIPT market and maintaining its dominant market share. The recent announcement that Sequenom CMM had accessioned over 100,000 MaterniT21 PLUS test samples since the test was launched in October of 2011 is further evidence of the remarkable success of this testing service," said Harry F. Hixson, Jr., Ph.D., Chairman and CEO of Sequenom. "Furthermore, we are making progress in our negotiations within the payor community, with more than 70 million patients now under coverage who have access to the MaterniT21 PLUS test."

Revenues from the Sequenom CMM diagnostics services operating segment grew to more than $29 million in the first quarter of 2013, up from $4.8 million in the prior year period. As of the first quarter 2013, diagnostic revenue accounted for more than 75% of total revenue, up from 63% in the fourth quarter of 2012.

Revenues from the Sequenom CMM diagnostics services operating segment are recorded primarily on a cash basis. Approximately 35% of diagnostic revenue reported for the first quarter 2013 is attributable to tests performed in the same period. Approximately 65% of the diagnostic revenue reported in the first quarter 2013 is related to payment collected on tests performed in prior periods. First quarter 2013 revenues from the genetic analysis operating segment decreased 7% from the same period in 2012, due to a softening in consumables orders, partially due to timing.

Total cost of revenues increased to $24.5 million for the first quarter of 2013, compared to $10.3 million for the prior year period. Cost of revenues increased primarily due to the significant increase in Sequenom CMM's test volumes and costs to support increased testing capacity, as total tests accessioned increased 250% to more than 44,500 patient samples during the first quarter of 2013. Approximately 35,000 of those patient samples tested during the first quarter were MaterniT21 PLUS test samples, compared to approximately 25,000 in the fourth quarter of 2012, growing 40% sequentially.

Overall gross margin for the first quarter of 2013 was 36% as compared to gross margin of 31% for the first quarter of 2012. This improvement is attributable primarily to the positive contribution from the Sequenom CMM diagnostic services business resulting from higher cash collections during the quarter and improved efficiencies in processing patient samples. Gross margin for the Sequenom CMM diagnostics services business in the first quarter of 2013 was approximately 28%, as compared to a negative gross margin in the first quarter of 2012. Gross margin for the genetic analysis business for the first quarter of 2013 was 63% compared to 66% for the prior year period.

Total operating expenses for the first quarter of 2013 were $41.0 million, as compared to total operating expenses of $28.9 million for the first quarter of 2012, down sequentially from total operating expenses of $42.0 million for the fourth quarter of 2012. Selling and marketing expenses increased to $13.7 million for the first quarter of 2013 from $9.7 million year-over-year, resulting primarily from higher labor costs associated with the expansion of the Sequenom CMM sales force and increased headcount to support commercial operations. Research and development expenses increased to $13.8 million for the first quarter of 2013, as compared to $11.8 million in the first quarter of 2012, related primarily to increased labor and supplies and costs relative to the expansion into the Sequenom CMM North Carolina facilities.

General and administrative expenses for the first quarter of 2013 were $13.5 million, as compared to $7.4 million for the first quarter of 2012, primarily due to increased legal expenses associated with patent litigation, increased collection costs due to the increase in diagnostics revenue and increased headcount to support the Company's operations. Total stock-based compensation expense was $3.1 million for the first quarter of 2013, an increase from $2.9 million in stock-based compensation recorded for the first quarter of 2012.

Net loss for the first quarter of 2013 was $29.4 million, or $0.26 per share, as compared to net loss of $24.4 million, or $0.22 per share, for the same period in 2012. Net cash used in operating activities was $19.7 million for the first quarter of 2013, compared to $23.3 million in the same period in the prior year. The Company also used cash for capital investments of $4.1 million and debt repayments of $1.8 million during the first quarter of 2013. As of March 31, 2013, total cash, cash equivalents, and marketable securities were $151.1 million.

"We are pleased to see sequential improvements in volume, revenue and margin during the quarter, an indication of steady growth and sustained momentum in 2013," said Paul V. Maier, Sequenom's CFO. "As we complete the process of moving our billing and collections processes in-house, we anticipate even greater control in monitoring our payments from payors and improved workflows that will help us improve our collection cycle and reimbursement."

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Sequenom, Inc. Reports Financial Results For The First Quarter Of 2013

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