Revenues
Total revenues for the full year ended December 31, 2013, increased by 28% to $7.6 million, compared to total revenues of $5.9 million for the prior year. Revenue from ConfirmMDx for Prostate Cancer was 75% of the total Q4 revenues compared to 20% in the same quarter last year. Total revenues for Q4 2013 were $1.6 million compared to $2.1 million during the same period in 2012. The decline in Q4 2013 revenues compared to the prior period was due to lower PharmacoMDx revenues resulting from the timing of the completion of projects and the shift in focus to ClinicalMDx opportunities. For the full year, 50% of company's revenue came from ConfirmMDx for Prostate Cancer, compared to only 8% in 2012.
At the beginning of 2013, certain molecular diagnostics billing codes adopted by Medicare, Medicaid and third-party payors were eliminated or replaced. As a consequence many payors are requesting additional information to process claims, resulting in payment delays. These changes have a larger impact on companies new to the market and those with limited years of reimbursement and billing history. Based on 2013 reported cases and historical average reimbursement amounts, the total estimated value of tests performed in 2013 was $9.2 million. Of this amount $3.8 million was recognized as revenue, leaving uncollected outstanding unrecognized revenues of $5.4 million, consisting of $2.8 million from Medicare and $2.6 million from private payors. This uncollected amount has been excluded from the Company's 2013 revenues, but may still be recognized and collected at a later point in time. MDxHealth's revenue recognition policy evaluates the certainty of payment on a payor-by-payor basis, currently resulting in a mixture of accrual based revenue recognition and cash based collections depending on our evaluation of certainty of payment. We believe our conservative revenue recognition policy is appropriate at this time. However, as more managed care contracts are secured, and experience with existing payors increases, the Company expects to transition more payors to an accrual basis and increase revenue recognition in 2014.
In Q4 2013, the Company reported a net loss of $4.4 million, or ($0.13) a share, compared to a net loss of $3.1 million, or ($0.07) a share, in the same period 2012. The Company's net loss for the year ended December 31, 2013, was $16 million, or ($0.47) a share, compared to $11.5 million loss, or ($0.45) a share, for the prior year. This loss is attributed to the continued investment in commercialization efforts in the U.S. and the delay in recognizing revenues from ConfirmMDx sales.
Operating Expenses
Operating expenses for Q4 2013 were $3.7 million, a decrease of 16% compared to $4.4 million in Q4 2012. This decrease is attributable to the capitalization of internal development costs for products partially offsetting the ongoing build-up of U.S. operations to support the commercialization of the ConfirmMDx for Prostate Cancer test. Operating expenses for the year ended December 31, 2013 increased by 10% to $17.8 million from $16.2 million for the prior year.
Cash Position
The Company ended 2013 with cash and cash equivalents of $24.7 million, compared to $15.5 million on December 31, 2012. The Company raised net proceeds of $24.3 million in a private placement in June 2013. Collections from ConfirmMDx reimbursements were $2.4 million in 2013 vs. $0.3 million in 2012. Collections which are an important variable in net cash burn is improving and will be an important factor in the strength of the company's cash position. Excluding the proceeds of the 2013 private placement, the Company had a net cash burn of $15.3 million in 2013 compared to a net cash burn of $11.4 million in 2012. This 33% increase in the cash used by the Company resulted from the expansion of it's U.S. operations, and commercialization of the ConfirmMDx for Prostate Cancer test.
Outlook
The Company is expanding the sales and support effort for ConfirmMDx for Prostate Cancer, with plans to increase its U.S. sales force from 15 to 20 sales representatives and double its billing and collections department in Q1 2014 to accelerate its revenue cycle and reimbursement.
In early 2014, MDxHealth reported on the potential prognostic value of its current ConfirmMDx test. If further studies confirm the prognostic value of the genes used in ConfirmMDx, this would add significant value to the test and open expanded labeling. Consistent with its focus on the urology market, the company is also investigating the possibility to fast track the commercialization of its previously reported bladder cancer test. The test is designed to rule-out bladder cancer in patients diagnosed with hematuria, who are traditionally followed with cytology and cystoscopy. In 2010, MDxHealth published the results of a validation study of the two-gene epigenetic bladder cancer test, with strong positive results, in the journal European Urology. Based on these data the Company is accelerating the development of this test in 2014. The Company will also continue to pursue its development efforts on next generation sequencing (NGS)-based assays for both its own service offerings, as well as for its pharmaceutical partners. NGS offers the prospect for reducing cost and increasing throughput of molecular assays.
For fiscal year 2014, the Company expects a significant increase in ConfirmMDx test volume, with the majority of revenues generated from sales of the ConfirmMDx for Prostate Cancer test. Building upon our continued positive interactions with the Medicare contractor responsible for molecular diagnostic test reimbursement, MDxHealth expects to receive coverage with evidence development (CED) for its ConfirmMDx test by Medicare. Additionally, the company will continue its focus on capturing managed care contracts to accelerate the billing and reimbursement cycle with insurance companies. In 2014 the growth rate in operating expenses are expected to moderately increase from the rate in 2013, primarily from the expansion of infrastructure, including sales force and billing department expansion, to improve the order to cash cycle. R&D spending in 2014 is expected to modestly decline. In 2014, collections from private third party payors and volume increases previously noted are expected to improve revenue recognition and cash inflow. Therefore the 2014 net loss and net cash burn are expected to improve compared to 2013. The projections provided herein should be considered as forward looking statements and are subject to the risks summarized in the safe harbor statement at the end of this press release.