SAN DIEGO ( TheStreet) -- Pop! Goes the Sequenom ( SQNM) bubble. Shares of the genetic test maker are down 17% in pre-market trading Tuesday following a year-end conference call Monday night in which Sequenom management declined to offer 2010 financial guidance, laid out plans to raise more money this year and failed to provide any new details about the development of a fetal gene test for Down's syndrome. Sequenom's sober, conservative assessment for the year ahead did not live up to the unrealistic -- even fantastical -- expectations held by some investors who mistakenly believed the Sequenom's well-documented troubles were a relic of the past. Some Sequemon analysts have helped fuel the hype, using fuzzy math to gin up sky-high revenue and stock price targets. As it became clear that Monday night's conference call wasn't going to be the party some investors expected, they bolted for the exits. Sequenom's stock is down $1.34, or 17%, to $6.42 early Tuesday. The stock was down as much as 20% in Monday's after-hours trading and closed and closed Monday's regular session down slightly to $7.76. Sequenom shares had essentially doubled in price from $4 to $8 this year in the run-up to Monday's financial results announcement. Sequenom shares plunged last year after the company admitted that clinical data validating a non-invasive, blood-based fetal gene test for Down's syndrome were "mishandled" and therefore no longer reliable. A good portion of the company's management team was fired, including the CEO and head of research and development. Investigations by the SEC and FBI were launched and are continuing, and a class action lawsuit filed on behalf of shareholders is in the process of being settled. Sequenom is still trying to recover from a disastrous 2009. On Monday, chief financial officer Paul Meyer would not provide any financial guidance for 2010, citing the ongoing litigation and government investigations as well as the uncertain commercial potential for its two new diagnostic tests recently launched. One of those gene-based blood tests, which will allow expectant mothers to determine the sex of their baby earlier than conventional ultrasound, will not be reimbursed by insurance companies, Meyer acknowledged. Sequenom closed 2009 with just under $43 million in the bank, a bit more than expected. But Meyer also admitted that Sequenom will raise more money this year. "We are currently in the process of assembling our preliminary plans to address this issue," he said.
The company is currently burning through about $3 million in cash per month. Meyer declined to give guidance on the company's burn rate for the rest of the year. The resurrection of Sequenom's Down's test is still a work in progress, said CEO Harry Hixson Monday, deflating the expectations of some investors who had hoped for more details, perhaps even an announcement that a final testing methodology has been selected. Hixson did say that Sequenom was focusing its efforts on a creating a Down's test which will detect fetal DNA in the blood of the mother. Sequenom's previous Down's test -- the one that was "mishandled" and led to the company's blowup -- was based primarily on detecting fetal RNA. Monday, Hixson said a RNA-based test was "basically on the backburner at this point." Sequenom has not yet made public any details or clinical data supporting the validity or accuracy of a DNA-based gene test for the detection of Down's syndrome. When asked for a progress report, Hixson said, "Our DNA methodologies are still being investigated by R&D. We are not going to pressure and put any time pressures on the scientists here, so really can't comment beyond that." The company continues to collect blood samples from pregnant women, which will be used to validate a DNA-based Down's test if the company can create one. Sequenom lost $18.4 million, or 30 cents a share, in the fourth quarter, compared to a net loss of $15.4 million, or 25 cent a share, in the year-ago quarter. Fourth-quarter revenue decreased 11% to $10.8 million. -- Reported by Adam Feuerstein in Boston. Follow Adam Feuerstein on Twitter.