FT. MYERS, Fla., March 5, 2012 /PRNewswire/ -- NeoGenomics, Inc. (NASD OTCQB: NGNM ) announced today that it was revising upward its previously issued revenue guidance for the first quarter of 2012. The Company now expects revenue of approximately $14.5 - $15.0 million for the first quarter, an increase from the prior guidance of $13.5 - $14.0 million released on February 16, 2012. At the $14.75 million midpoint of this revised guidance range, first quarter revenue would be 68% higher than it was in the first quarter of last year.
The Company also reiterated that it expects to be profitable in Quarter 1 with earnings of $0.00 to $0.01 per share, but is suspending its previously issued guidance for the full year 2012 pending a review of the implications of certain provisions in the Middle Class Tax Relief Act of 2012 (the "Act"). The provisions of the Act that affect medical laboratories, pathologists and hospitals were first proposed on Tuesday evening February 14th, and then passed by Congress on February 17th with very little input from hospitals and the laboratory industry. The Act was then signed into law on February 22, 2012.
Among other items, the Act reduces reimbursements on the Medicare Clinical Lab Fee Schedule by 2% beginning in 2013, and sets an expiration date of June 30, 2012 for the Technical Component ("TC") Grandfather Clause. The TC Grandfather Clause has extended a decades-old practice by independent labs and eligible hospitals under which labs bill Medicare directly for reimbursement of the technical component of certain anatomic pathology services. The clause has been renewed year after year for over a decade, and the Act further extends it until June 30, 2012. However, if it is not extended again beyond June 30, 2012, labs will be required to bill hospitals directly for such technical component testing, and hospitals will have to absorb the additional costs without any additional reimbursement from Medicare.
Douglas VanOort, the Company's Chairman and CEO, commented, "We experienced strong and broad-based revenue growth in both January and February, and we expect this excellent growth momentum to continue. However, we are disappointed that anticipated changes in the TC Grandfather Clause will now require us to concentrate on changing our billing practices rather than on improving cancer genetic testing. Until we can quantify the implications of these regulatory changes, we are suspending our full-year 2012 guidance. Over the next few months, we will focus on developing strategies to offset the potential negative impacts from this new legislation in the event that the TC Grandfather Clause is not extended further."The Company reserves the right to adjust this guidance at any time based on the ongoing execution of its business plan. Current and prospective investors are encouraged to perform their own due diligence before buying or selling any of the Company's securities, and are reminded that the foregoing estimates should not be construed as a guarantee of future performance.