[Updated 5/3/16, 11:08 a.m. See below.] Exact Sciences plans to launch a national TV advertising campaign in an important test of the appeal of Cologuard, its diagnostic product for colorectal cancer that requires patients to ship samples of their stool to a lab for testing.
It’s not the first time Exact (NASDAQ: EXAS) has made a national media pitch to patients and doctors—the company took out a full-page ad in the Sunday edition of the New York Times after Cologuard won FDA approval in 2014. But Madison, WI-based Exact’s marketing strategy has mostly relied on a nationwide team of sales people who contact doctors directly.
The TV push comes as Exact attempts to build more momentum for its only approved product, a task that hit a disappointing and unexpected setback last fall when a closely watched panel of national health experts proposed classifying Cologuard as an “alternative” colorectal cancer screening method. The draft guidelines, which still need to be finalized, left Cologuard out of a group of recommended tests and raised questions about how commercial insurers would react. (Exact had previously secured coverage of Cologuard from the Centers for Medicare & Medicaid Services.) [This paragraph updated to make clearer that the guidelines haven’t been finalized—Eds.]
Nevertheless, Exact has kept on signing up private insurers to cover the test, which aims to detect colorectal cancer from DNA in stool samples. Cologuard is now covered for 57 percent of its target patient population nationwide, Exact said in a press release today.
The company predicts it will complete 240,000 Cologuard tests and generate $90 million to $100 million in revenue this year. It’s not off to a great start on that goal.
About 40,000 Cologuard tests were completed in the first quarter, up significantly from 11,000 in the same period last year, but marking only a slight increase from the 38,000 tests completed in the final quarter of 2015.
Exact reported $14.8 million in first-quarter revenue, compared with $4.3 million in the same period last year. Its net loss was $47.5 million in the first quarter, wider than the $35.8 million net loss a year ago.
The additional advertising could help. Exact said it recently finished a nine-week pilot TV ad campaign in five markets that resulted in an average 50 percent increase in Cologuard orders and 100 percent boost in the number of new doctors ordering the test for patients. Now, Exact will try to replicate that on a bigger scale.
“As commercial insurance coverage increases, television advertising drives Cologuard orders, and our sales team continues to expand physician awareness, we believe that adoption will increase at a meaningful rate this year,” Exact CEO Kevin Conroy said in the press release.
Exact’s stock price was at $7.50 per share in pre-market trading Tuesday morning, up 7 percent from its Monday close of $6.99.