San Diego-based Progenity, a biotech company focused on precision medicine, anticipates better years ahead after overcoming hurdles of the past and becoming a newly publicly held company.
The women’s health diagnostic firm became one of six publicly traded companies in 2020, raising more than $100 million in its IPO. It now trades under the PROG ticker symbol on the Nasdaq exchange.
“We started the year off strong like everyone else, but when COVID-19 hit, it did affect our people as everyone needed to work from home,” said Harry Stylli, CEO and chairman of the board at Progenity. “Despite those challenges and having a turnaround story. We still managed to go public, which has been quite an accomplishment.”
Founded in 2011, Progenity develops molecular tests to detect genetic markers in prenatal medicine and cancer.
Progenity’s product line includes the noninvasive prenatal tests Resura, for monogenic disease, Preparent Carrier Test for cystic fibrosis and Innatal, for chromosomal aneuploidies.
In May it also entered the COVID-19 testing market, introducing its coronavirus testing kit and partnered with Thermo Fisher Scientific to increase its testing capacity and supply chain access.
“Meeting the current need for COVID-19 testing requires support from every organization in a position to contribute to the national effort,” said Stylli. “We were able to leverage our molecular testing experience initially to support our women’s health providers who needed testing for patients and staff members, as well as offering our expanded COVID-19 testing services nationally.”
Products in the Pipeline
This year, the firm expects to launch two new products: the next-generation Innatal 4 test, which will allow much faster turnaround time than sequencing, and the preeclampsia rule-out test, called Preecludia.
The firm demonstrated the ability to quantify fetal fraction in the Innatal 4 test, a key development milestone, according to Chris Wahl, vice president of strategy and operations at Progenity.
“Preecludia has moved to the validation studies stage, which will begin next year. We already have the patient samples which will be used for validation and we expect commercialization of the test in the second half of 2021,” said Wahl. “We also have a handful of other products that remain under development.”
In the third quarter of 2020, Progenity reported $25.9 million in revenue, up from $18.8 million in 2019. However, that number fell short of the consensus Wall Street estimate of $34.7 million.
Progenity’s revenues to volume grew 12% quarter-over-quarter, despite the pandemic-induced lockdowns in certain other key markets, said Stylli, adding that revenues from the firm’s noninvasive prenatal testing, its core business, would gradually improve as more payors expand NIPT coverage for average-risk patients.
The company performed 84,067 tests in Q3, up 12 percent from 75,017 tests in the second quarter, including COVID-19 testing volumes.
“COVID-19 testing helped drive our company’s volume increases,” said Stylli. “We believe we will continue to experience return to sequential quarterly growth driven by the differentiation of our products and services and by recognizing the benefits of increased in-network coverage from both our core business as well as COVID contribution.”
“This year we expect to meet development and launch milestones for Preecludia and Innatal 4. We’re confident that our precision medicine platform will continue to gain momentum. We also anticipate further value-add partnerships that will provide validation. We’re well-positioned for compelling value creation in the coming years,” he added.
Last year in March, Progenity reached a settlement with the Department of Justice over alleged kickbacks to physicians and patients in past billing practices. The settlement called for the company to pay $49 million over five years.
Progenity received a $15.7 million refund under the Coronavirus Aid Relief Economic Security Act, most of which was used to make payments under its settlement agreements, according to the company. Headquartered in La Jolla, it employs roughly 600 staffers.