Exact Sciences (EXAS) 23 Feb 222021 Q4 Earnings call transcript

Company Profile

Participants

Megan Jones	Senior Director, Investor Relations
Kevin Conroy	Chairman and Chief Executive Officer
Jeff Elliott	Chief Financial Officer and Chief Operating Officer
Matt Sykes	Goldman Sachs
Brandon Couillard	Jefferies
Derik De Bruin	Bank of America
Brian Weinstein	William Blair
Vijay Kumar	Evercore
Catherine Schulte	Baird
Dan Brennan	Cowen
Jack Meehan	Nephron Research
Andrew Cooper	Raymond James
Puneet Souda	SVB Leerink

Call transcript

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Operator

Ladies and gentlemen, good afternoon. My name is Abby and I will be your conference operator today. At this time, I would like to welcome everyone to the Exact Sciences Corporation Fourth Quarter 2021 Earnings Conference Call. Today’s conference is being recorded. [Operator Instructions] Thank you. to Jones, like Investor Director would Relations. I introduce Senior Megan of And Ms. begin conference. you your Jones, may

Megan Jones

Thanks, thank call. Exact Sciences’ Abby us fourth joining and quarter all of XXXX conference for you for

the our news On today quarter detailing on Jeff our are news at Exact Financial the Chief our release release financial presentation Officer. and and available Operating issued are Conroy, fourth Elliott, Chief call Officer and Sciences exactsciences.com. CEO today’s company’s website Kevin earlier and This Chairman results. a afternoon this

we today’s on During forward-looking current expectations. will call, make statements based

Our our call actual uncertainties available and such GAAP over filings. accessed be SEC the descriptions results website. in may Reconciliations are risks in from the associated have Both will can with and material figures now our release turn of statements. to through differences Exact our Sciences I press earnings Kevin. included to are

Kevin Conroy

Thanks, Megan.

detection care. Our making by mission part earlier routine to medical eradicate is in of cancer

needs. Precision evidence cancer, patient and advanced welcoming Pfizer and exceeding testing, We Highlights for from first liver generating cancer to commercial test hereditary have test Work our brought business to that together and a XX%, to goal third ever, million for tumor growing Place talented X people billion our support year by solving XXXX Cologuard row, tests our our certified profiling in and being from a a milestone, business core to for support million to adding in $X dedicated the Great that team engine Oncology making cancer in nearly $XXX the include testing over a revenue, talented generating team new real sales reach first time strengthening reality. comprehensive by diagnostic surveillance

getting and leader the diagnostics our Jeff of commercial in we financial results. and now capabilities, detection, and scientific engine on are screening early advanced are started. because focus will just We our review cancer

Jeff Elliott

volumes. X% of ordered the an XX%, volume. Precision Screening XX,XXX DX healthcare Oncology driven COVID launch. of revenue quarter million, was Cologuard or afternoon. million, increase new $XXX testing. was Fourth have an by Cologuard increase Thanks, than $XXX revenue quarter Kevin. ordered was by XXX,XXX since XX%, providers Good up million, XX%, more $XXX Oncotype excluding revenue and driven during Breast

acquired of GAAP X acquisition Sales guidance. in gross to $XX billion. added the $XXX ended above our and our $XXX and a in million, $XXX COVID million, our weighted margin, Omicron growth XX%. to was loss cash $XXX with marketing to XX% in $XX $X million Our revenue our of November. gross amortization and quarter. million, over to was to XX%. Ashion expense was quarter loss decreased was increased million. both of was points margin which Pfizer securities above the agreement, consistent due co-promotion Adjusted EBITDA G&A related was expense – December with Non-GAAP payment the R&D was of Fourth which intangibles, a million testing which quarter expense due was variant. expectations for testing guidance $XX excludes million, Net of

Turning expect year. the the billion $XXX $XXX revenue our quarter to first and between between $X.XXX for billion guidance, total million we and $X.XXX million and during

first approximately million $XX year. This quarter expect $X the PreventionGenetics for for quarter between and between and and revenue and million $X.XX for $XX year. million of first We million the screening million $XXX billion billion for $XXX the between $X.XXX includes the and revenue

and the We million first $XXX Oncology $XXX million and the between quarter million Precision for revenue million for between expect year. $XXX and $XXX

visits for million the gradually force and quarter to million and assumes and and access abate million We between sales expect million COVID for testing $XX continues XXXX. that first revenue between $XX Guidance wellness and year. $XX pandemic improved $XX throughout the

be less to revenue current slightly loaded screening estimates. back-end than expect consensus We

For Precision expect from we globally. continued momentum Breast DX Oncotype Oncology,

international total the single-digit mid the to expecting and percent range over in U.S. are XX%. grow grow to We business

fourth We then and will Ashion first expect it in annualize the acquisition April. to the quarter growth in similar quarter contribute the as

our following a February. business revenue decreasing speed testing during to expect decline We continue the COVID in

We expected added about fight Cologuard We volumes approximately against is and a as to in support prepare the to lab and capacity for growth. to accelerating XX%. this margins X year gross This COVID point testing decrease due leverage mix unfavorable to our declined. non-GAAP COVID negative had

will Cologuard benefit automation XX%. as improvement we gross we capacity Cologuard this enhancements. margin from reach margins absorb We strong and least expect at confident gross Long-term, remain

are confidence our and we cancer long-term outlook OpEx, diagnostics. innovative our for to growth, invested in pipeline of Oncotype the given in Moving Cologuard,

For the with a new to $XXX campaign and full million. $XXX for team impact marketing sales we full from year million advertising Pfizer year, of the includes the Americans. and reach last Cologuard, unscreened expense of hired XX This sales expanded million we the year expect to

drive to new we as grow hereditary launch incremental the such our strong and business We as tests. cancer products, expect sales profitability team our

For $XXX $XXX million in forward. leverage going G&A, million we expect to significant

scale One our in tens operations. cycle revenue of is to dollars of example millions and We in within provide investing initiatives are several drive recurring savings.

cycle upgrading are our cost and new efforts commission. and streamline These reducing We errors tools and manual our systems and checks faster enable eligibility benefit work. revenue lower

within in run-rate this basis cash expect X deliver over flows just million $XX incremental on years. to a We

R&D, million. million products. $XXX expect than $XXX future More supporting XX% of R&D to For we is

CapEx We expect amortization around and to million. be intangible $XX $XXX run to for million

R&D to future will facilities support to in centers back turn investing now the are state-of-the-art growth around the call I country. develop and We Kevin.

Kevin Conroy

Cologuard, the the last leadership electronic than colorectal $XX million Cologuard. making XX more it initiatives commercial testing rate sales reach, These easier will We during enhancing fuel come. strengthened by on than and the to Cologuard systems several more created from group, to experience We XXXX patients expanded build our our from achieved point to age brought screening. of years momentum for and XX exceeded benefits for our with to to providers ordering customer the through educating cancer Thanks, XX much to make a the in in $XXX we health plan repeat revenue Cologuard Jeff. both growth in Cologuard improvement screening a in million XX March more releasing earlier for exciting being the unscreened and more to team our and XX%, at patients take advancing campaign people rescreened to patients, new order initiatives XX encourage Americans age easier million We in providing our healthcare and and growth lasting advertising providers Cologuard benefits action. starting year, goals

New impact and opportunity results benefit Medicine we of to new to and for and standard continue node-positive OncoMAP test people DX for publication in The have quickly becoming cancer for important early-stage the answered more questions cancer women chemotherapy for node-negative. of support as advanced test Oncology Oncotype Precision responder comprehensive Journal X.X adding outstanding did of recurrence million just with breast last test risk Our breast tumor our year care study Breast has Oncotype delivered led of an England of diagnosed DX, live. to of stage women early even the [indiscernible] with to testing cancer The a Oncotype with DX supporting responder record study the the number team a ExTra. by profiling the

and on globally, We focusing year are women Italy. test DX the making with to our Oncotype largest two more countries the opportunities, this Breast incremental available Japan growth

necessary successfully We our in provides the Ashion oncology. leadership our precision to foundation acquisition, which extend integrating are also

cancer with early the women breast Oncologists of each stage treatment. people undergo DX of bioinformatics picture more Oncotype sequencing additional OncXerna their of HERX-negative tumor-informed capabilities, and with us year U.S. test, minimum partnership an gives our necessary understand differentiated, agreement inherited of comprehensive cancer than them We can foundation XX% provide for Ashion residual them hereditary ER-positive screening, to all license order provide the test, a to these understand Helping only Therapeutics. women. and opportunities of Oncotype the and cancer. also risk earlier profiling to more in test like cancer their the guide could test Offering announced DX in full tumor motivate more testing treat and effective disease our cancer biopharma XX% all detect hereditary recently their diagnosed

We of in have the oncologists relationships U.S. with XX%

can X beyond team and earlier. breast DX year. in hereditary eligible with proactive Oncotype each expand cancer Our patients most cancer, not engage primary care reach care nearly diagnosed oncology to with XXX,XXX into cancer testing the people diagnosed plan for of million people We the those just to

our minimal team PreventionGenetics We positioned relationships Combined germline we They their a than genetics. care established with reality and providers. risk customizable of detection to high-quality expertise, incremental sales, insurance The lab at a and are vision experienced with test, primary with coverage our PhD risk early investment. reducing marketing have more this test. a make to multi-cancer patients with provides their more XXX,XXX screenings can frequent understand leading actions like cancer, help

more test off within evidence We to coming. patient opportunities good generating diagnostics a the largest our three with data impact are start for in

Our pipeline colon finalizing our of to in in tumor-naive lab goals and X.X, share beginning results FDA feasibility launching top study, our next our disease generation development multi-cancer monitoring. XX and prospective line to next present test, a from prospective BLUE-C and for and multi-cancer the and minimum colorectal validation of blood months announced version present and colon study submissions cancer the Cologuard blood over are support Cologuard our data tumor-informed for data our design cancer data, our recurrence before test residual

of patients how growth and contribute top cancer of Oncotype of Cologuard of tests pipeline are DX. on Our billions dollars transform and treated could

are with lab and team We recent and test pleased commercial plans development for developed our multi-cancer test progress on launch. from

Combining unique our Cologuard serve we cancer value precision broad create health technologies cancer, and Sciences most hereditary X.X, multi-cancer tests, available. we and systems This in test step. blood oncology offerings most every Exact the a with and supporting teams colon cancer the this efforts, provide will patients. how importantly, we make providers, will patient and screening and have compelling Our

We take now to questions. your are happy

Operator

take question Instructions] will with [Operator our And you. from Goldman Sykes we Matt Sachs. Thank first

Matt Sykes

in taking guide consensus what probably talked first you more of you the everyone. back visits about baking for move end the thinking starting quarter afternoon cadence love but Maybe kind just to for Hi, guys we just expects bit ‘XX first little of guide? through screening, a and loaded what you hear my the about maybe second how about to love questions. I than of good and know as you less just I for get quarter the thinking and the overall how access are are year physician would would this recovery. wellness are on Thanks guys

Jeff Elliott

take that This I’ll Matt. Jeff. Hi, one. is

primary started. the holidays the variant If in Since would it in then, somewhere before IQVIA was where in pandemic. you that Omicron November look between of data, office access was XX% care had pandemic XX% we at and the the IQVIA’s physician what obviously, talk to about

is here people news think access cases it now impact on I which that a whole of so lot. good sick means And a changed less are down, having country. it’s this fewer way the hasn’t calling Omicron The an are and

wellness continued both expect office I visits. physician improvement forward, Going access in and

said, finding our reps to other we better educate in that there. with uncertain So variants access Oncotype. I And Cologuard pandemic. time, then think physicians them are be There over out that are could highly and and the environment ways on are even

these has So, done still a to overcome they headwinds, but the exist. job team nice work to

don’t So yet will in year. the normalize think market I things there this fully

Matt Sykes

XX%. is Thanks about had hit you the for ‘XX, build for one maybe on But capacity talked COVID of gross which And for to given that, margin the Cologuard then the – impact sort potential it. mentioned more, Got Jeff. out. just you understandable

accelerate As we potential? XXXX of of had gross could prior is specifically in terms Cologuard when expansion of for kind mentioned that profitability in automation, you sort think what your that thinking you should we working of do path that of to then with be importance timeline? to and XX% about of within sort sort think that of Cologuard And you are that adding your margin is the you today or to about the

Jeff Elliott

expect up pandemic, the XX% opened a of Matt, I target, lab towards of that. growth we that but is the new before anticipated make some progress do to long-term Cologuard. ahead actually Recall very nice

pandemic XX% high of cost $XX margin, the long-term expected that reaching added some for about leverage. bringing actually is this that Cologuard gross and of test. the lab new Again, additional growth added approaching because range been with have per We and on now

a very test will clear very are back as going pre only done pandemic, that has $XXX expected the I not both Cologuard where given leveraging Going team per a job new automation, the also path be provides. automating were our am cost combination term, they of to forward nice Cologuard in these test. that will cost, value reach highs. Longer additional the we though this but we we labs, through per fixed absorb revenue get improvement that of we It’s to fixed confident which

gross on that, Cologuard. do when for path you longer I third to a the think there So, math again, XX% margin term is

Operator

question we from with And will take our Couillard next Brandon Jefferies.

Brandon Couillard

morning thanks. good Good or Hi, afternoon.

with you mentioned, of happy new given good docs in you kind and gone with pretty whether ‘XX course Jeff, over is of think, your would I you I XX,XXX the and kind kind so just just the which how far added of of talk integration the about reps that think the are seasonality. seeing from quarter, since? fourth has outlook I are productivity Pfizer the

Jeff Elliott

can outlook. then Hey, on docs Brandon. new start the could maybe in and Kevin the I for force sales outlook chime on

quarter. light a the I as new in excited very of providers, number, in far the to As the new good very especially see pandemic. was That’s XX,XXX

can think XX,XXX. we rate, a drivers drivers. the we orders the There opportunity to where rescreens, forward, productivity new marketing wide When the year. number of expect are new XX, number will the be have force Cologuard this maybe biggest there growth that we that we a expanded growth of you range XX,XXX very look this with number from of continue the Cologuard order up and per Going sales significant to to reach is year, to providers provider that plus like at that The this is Cologuard in have, fortunate of be bigger still in year, additional have variety probably innovative things lifting driver of campaign. I our out number this

part to do talk core of growth Kevin, force? orders number the the higher So, year, will be you the about of doc than rather doctors this Brandon, the sales per ordering. want new

Kevin Conroy

Yes.

are integrate sales members. work the team We XXX to force really proud did new that of

organization commercial side amazing the the precision an and side. have on We screening both oncology

large remarkable the country Cologuard, has thoughtful the into just about with team very approach being side team systems. done teams screening one through organizing health the forming four On as Omicron a job together we how across

the of year, upside There will through tools initiative, and for year. Cologuard year, is with over there the of We focus half be more potentially Epic for to make XX-year-old The of prior bring an progress are the additional We focused let’s people XX, on team new provoke XX to is we that. just bit going intense retirement lot care more a investments can the really digital The are what to physicians talk this there this action. on Cologuard at jumping that grow say, to campaign, we our and making rescreen bullish that about IT. group. saw is effort that instance this believe even standard to more to with to last up people colonoscopy. in We

year. sales the of up, the starts to as that’s where course happen that’s across all open So, over force, start offices it we so great with. to things expect the And

Brandon Couillard

Thanks. embedded oncology primary Jeff, should is that talk then into care? launch, year? revenue And not me. this in on to helpful. for And outlook we there of or timeline bringing Would about clear cancer it’s any that really That’s actually be the precision the screening, hereditary

Jeff Elliott

Brandon, I this any year. the baked do HCT. with We not start into will outlook the HCT have revenue

of that bake business. So base did, source potential however, upside. in PreventionGenetics the is I a

million baked $XX As the $XX in to guidance. I million this to remarks, my said year is

want far to timing, that, as cover you As do Kevin?

Kevin Conroy

contract expect and kick anybody take the half. there one Yes. upside. result build hereditary bake encourage our timing it start in that I to we testing some to hereditary – cancer order test The want express major the want of payers to caution is in again, to some a that we there the start step to to the in for payers to in, that easier the expectations. going to it And to through testing physicians will time to instance with our into for in revenue but second provide want genetics and are medical that of get to services add talk that this the about where That’s to process I strong similarly digital make connection team. year, that don’t with to on Epic you nobody part encourage to But to to and is

Operator

De next with we from And question will Bank Derik take Bruin our America. of

Derik De Bruin

Hey, sort the good afternoon. Hey, $XX to just PreventionGenetics in of segment, is that clarify, screening million?

Jeff Elliott

That’s is. correct, It Derik.

Derik De Bruin

Okay.

mean, are sales additions think for the of – implied So bit rebound, Cologuard force with the some looking. I below, the and that that new the a Cologuard is given sort being of growth I those all still said little and

of that, sort the that that force? number fact $XX in of bit people sort sales level begs was that number? of sort embedded Just looking? of the that I recovering are what’s number, conservatism as COVID with revenue where markets I the sort question so from by have said, it below, in And still the you driven that million is And on were think, a of little the the more

Jeff Elliott

for implied XX% billion. $X.XXX to What’s we fortunate are billion of a $X.X Yes. Again, about That to Cologuard drivers. equates significant to number growth. growth have is

Obviously, become million things X-year of there, re-screening, think revenue people when X you eligible available the baked million there. today, we is already this have in at look another opportunity there $XXX like year. X.X You million restating, for of

age is million. XX, this So deliver of When obviously, group market, to bottom of the lot million the that there’s million of $XXX driver, we big look Obviously, revenue. the revenue room baked size another you out $XXX a at if more the people Cologuard about in park, go we’ve and and there the is, than in all hit sales so on year, well trending a all obviously be driver to force, force the Things there again right out sales force on very opportunity and as on electronic huge it XX The there. XX. are now, XX ordering. doctors said, to where prescreens that’s They Kevin screened that is starts. educating sales need XX essentially

it year. the really still there. That’s that lot a of all There’s this some there. now of look, are of COVID. mean So great team, starts at the things middle in we you expanded expecting this And we’re a news night uncertainty sales force on I with turn

world as reality guidance that the out So here and provide we when account over rest to recognize important headwinds have in a the there that company, the early for is are the we we year it the in it that for there in year. stay some of

Kevin Conroy

Yes.

that of is this X during pandemic, face-to-face have XX% first pre-pandemic the think returns visibility rate, I office perfect we quickly last into we and That’s offices – don’t is of will on measurably. how up course the our quickly have back wellness average business, is go want face-to-face dipped to start upside and tremendous again missed that – X about call patients return The to about the Kevin, visits pandemic. don’t earnings off to course to good over the how which there I into open we to visits, and will we’re of here, office million news – by the the the the years, visits.

think of what are said be? Cologuard start think the do was Cologuard And question users the impact using we more. So will to asked, you going that marginal we

We have seen that.

previously half able been our reach frequently to did. volume of as the we again key on that ordering the top by to Now customers haven’t focus we is as

be to how up. the seeing the personally how at Omicron and not use pretty we this around open I dynamic positive about – abated. just words Jeff’s country how I’m has those we knowing offices quickly sober So want quickly year, look

color the think, I on guidance. that’s, our So

Derik De Bruin

was go sensitivity GI staying help driver had bit above little and sensitivity what prescribe actually the and With to that improved above XX% data Cologuard bit a that we trying and little that level Can Great. more ultimately about get response. great obviously in means you when that’s like more can – of was means sort just in ASCO to the about release a XX%. that comes talk what to terms a Thanks level investors, also of sort a what I that the for of for some stays XX% And up really, for being little like the XX% AA I in? back bit think an docs think for that, from we and That’s looking X.X. And test. incremental of ascertain difficulty that of data us that the of BLUE-C in color.

Kevin Conroy

original the free XX% The Cologuard biggest with data was disappointment in cancer.

is markers, market. off learning also our we we techniques what machine used the so to markers R&D X.X at team of from City that refine then new did specific improved advanced help the in data Cologuard Redwood us and a the our And team we coming and way more sensitive looked these

that really of a sensitivity machine is study. that adenomas up with that So I XX%. to believe, apples-to-apples, markers different data for the And to want DeeP-C learning advanced the it’s combination bump emphasize and we

does depending So collected samples. with in variability of upon we time that because about that etcetera. polyp, That’s really current, XX% us? going detection so to what your about as They is precancerous case deal precancerous Cologuard DeeP-C. of docs a control polyps. for we’re were these XX% similar that’s with next scope, get not want XX% your your day big reality GI, there’s generation, Commercially, because prospectively see do saw the colonoscopy to much adenomas in are of where of detect you size

Cologuard for has into pre-cancer detection. that years gain. detection And more So big in now impact you rate life when the how it only aggressive be a market we then can on feed lot a XX% models,

colonoscopy or see USPSTF to and that that approaching life number to colonoscopy. of gained of superior is look will at data harms vastly is the the Cologuard, will that compared fit years the the unnecessary performance, So

act care the Cologuard see presently standard we’re work of a to great coequal that doing Cologuard time colorectal and to a deal. for coequal provide new is though and considered it that but believe is So of Cologuard in with physicians take big urgency colonoscopy the a becomes is to but of little the that it’s patients, it standard even time, with out, care, it’s we guidelines, play in and this way of of day, screening. It’s to over standard awareness cancer that with not we minds become coming. going greater the the a bit The a

Operator

our we Brian from take William question will Weinstein with next And Blair.

Brian Weinstein

guys. the Thanks Hi, for taking questions.

you guys about Cologuard. penetration So I have that often recall don’t exact XX% frame. talked the time for

where that sales I differently. all really colonoscopy and Jeff, campaign driving difference something it’s revenue going million to million you about That advanced the think for unscreened I and tests how new by or X and about the year you individuals tests like the And would about come as $X target take does think of decade. in $XX the end between in you revenue. after each you about Have $X.X I’m and marketing this billion between billion conversion thoughts that curious, talked that you at from a about from? unscreened. trajectory, think

and part answer, that why campaign as that think maybe you So could of address can you that successful? be

Jeff Elliott

Brian, take I’ll this is one. that Jeff.

see in today, because others options screening you where cancer We you know and at targeting with rates, screening. screening term, the possible, like are that’s we that’s again, XX% ages that’s XX breast somewhere And overall above. if rates and for possible many that’s cervical It’s So range. they’re look XX%. Cologuard. and Longer possible including

out of have or evidence to using there country, who we documented XX% today we’re lifting XX% Cologuard, market, Cologuard a rates, previously about And lifting which had there screened were mix screen is with at of today which gotten blood with that a had XX% screened that The longer screening doing. been does test. been with so, colonoscopy you So get is look question, at our previously patients if fecal what and patients rates XX% know About we screening it’s term, a and from already but before? share mixture When higher, screening is ask before. this in taking the your what? in never overall you more to of how Cologuard

and expanding know we screening we’re So this the tested. importantly taking market. getting We people we’re in market know more also

physicians the And Another to earlier, pandemic way has order is to Brian, to there, to helped do Kevin’s analysis. a get Cologuard. get accelerate We point that. more decile to

at today look the look one trends stands at us of orders you The the pandemic, that different the those XX% before doctors top me of these in and calls doctors. before is we represented and about order that to different kind thing doctors that I’ve in of the sales So well, talked when really QX, their down of because some start has their the the down. pandemic. coming again, doors, order XX% and because trends the versus pandemic. access patients of down They’re unlimited fewer they’re because about have Well, they through are our force pandemic, there been

pandemic, They there, out bottom are gets get doctors nearly of come The the of of and However, really XX% that will reps orders, start is excited pandemic. represent in we those as before there, come back. QX were ordering the the more doctors as believers. what XX% that the back pandemic, will back in than they patients more, again, of did true factors, the those XX% get will

the of bottom a base, that the for near the a of order amongst So the doctors penetration all broadening we’re of future. kind well bodes significant deepening seeing that

that’s how urgency in there. to that, lift rates So confident very are marketing get here. that in country. there, the increase get That rolls This we very people this stay the screening going and to Brian, screened am overall it will one I one, the new more campaign help near-term out tuned

Brian Weinstein

readouts just so kind for on expect you follow-up running just you take over there’s that to just place? various then to data would or want kind things, year when of through sort a of sure been the of And make Okay. timing readouts, in timing mind no the on next change

Kevin Conroy

Yes, to Brian. take that, I’d be happy

in combined data, past of of top will the quarter out half second submission FDA the then Next-generation year. data technology, we read to case top year, pivotal the line next second of control early the line study Cologuard, fourth have first drive case half year XXXX. our we Multi-cancer the to data clinical mid-XXXX, cancer Colon with BLUE-C first that lead the data in this in half, probably this XXXX. that expect control validation, to feasibility in blood, our Exact Sciences half BLUE-C expect detection

Our prospective study starts late XXXX.

MRD to of validation just fact our [ph], XX Oncoguard take this second XX MALB about Our that I type will a be that different to year. attention complete. probably test liver test clinical the reimbursement, of months call the half And to want in study will

that reimbursement. and to and So the with we Brian? get real-world else touch offer summary. cash I pushed evidence key build that, out pocket is can We’ll that’s continue continue to unfortunately, off upon, didn’t Anything before pay that of partners

Brian Weinstein

that I I and think talk sure the thank everything up call. to you and I’m on on had, we’ll but else Thanks. guys you you someone will you missed after pick it, if got

Operator

our will Vijay from We next take Kumar Evercore. with question

Vijay Kumar

Jeff, Hi, the question. here, it’s screening revenue $X.XX XX low Thanks guidance the billion $X.X at maybe one for guys. taking about end. acquisition, my the around on guidance here,

XX XX screening assuming XX XX-year-old I’m you. walk those base of your other mean, I in double your in to and noted not rescreening fiscal XX access I perhaps year-on-year. ‘XX, it back to fiscal procedures physician us ex up improve, think guys Pfizer decelerating you XX decelerate and last revenues out ‘XX. expect to companies year, on to maybe why be the pre-screening if ‘XX, in you in about improving, a to the contribution, why if contribution? that to age If sense in are through contribution, XX $XXX just to being Cologuard Cologuard that device inclusive and is perhaps pre-screening up million seems sure would go I doubling makes But

Jeff Elliott

guiding consistent to this Jeff. pretty we’re first, at million an start, I incremental of to revenue the from is That’s midpoint. year-to-year. mean, $XXX Vijay, Sure,

have that biggest incremental we XX. as see have beauty rescreen that we don’t Well, this high I sales The our this an model all year, sales Cologuard which together, force right? X-year last So expectations business and program for As example a year expanded productivity. that is driver in of the deceleration. here, to force, work drivers see is we large of that growth multiple our

they So hand-in-hand. all work

can’t all you out. those parse – really So things you

I part a that’s kind that We screened. them probably million good expect the olds, that’s part the business XX XX good period is It’s years a source of of where again, year business are because above. expect XX, of XX think pool And XX% are people. recurring of now. when that eventually The time, exciting And patients screen say XX, grow keep significant Cologuard will margins out them, thing. because good revenue. time, higher patient of That’s the to for That the it to time. keep getting of in we I our – part we business. you’re rescreen was and margin not the core higher. rescreens increase doing won’t XX And screened and over that’s that to a Cologuard for that that a other do growth is, screened growing fastest point will us of people drive and a our faster. becomes It’s Cologuard faster right? over very get drive at them a more to higher, business is compliance what way grow That’s long eligible. a who parts thing, have revenue. revenue. source of

big of a revenue. again, So, source recurring

earlier, at have got point. access a pandemic. But limited visits we look, attention of Vijay, here. expect growth to year, talked wellness a we about, the down are significant this amount The we that over on But of XX. broad-based and We still somewhat fact is your because rescreening

we those in, provide we So all our take things guidance.

Vijay Kumar

similar And increase, plus still XXX was past, ‘XX Pfizer them think the roughly have sales million flow revenues. fiscal so looking incremental we severely maybe mentioned I And our that, was increase you of had just be Pfizer, follow-up of what cash added in the the Is screening that’s the rep, neutral. for of the $XXX case? to that expect Jeff, to to one you guidance, and we didn’t And curtailed, Last revenues. year, right? $XXX I’m at access million

conservatism dollar guidance a to basis in on dollar still seems in in here? line we’re and the some it increase be the year, is with this ‘XX, Pfizer perhaps there have We

Jeff Elliott

last good. seems breakeven at a have we Vijay, on expect has The for better Pfizer, again, to been basis, productivity probably cash were there to them in October, of so answer Exact keep far, out Pfizer least given thrilled some Well, that flow they from the we’ve that while that incremental seen weren’t Do productivity. that until team, employees working productivity year be that we’re them they I question. actually that, onboard. do hired to for mind driving

So least incremental. all some to the were it’s at is team not extent that that, base. There in

year. mind was when impact back XXXX on you that higher. pandemic, had the the careful that do last easy allowed in Also an XXXX, keep in be to basis still growth It a faced year-to-year COVID that from you go we if comp pretty significant got look incremental comparison. which you’ve an So

Vijay Kumar

And sorry, housekeeping, my Jeff, on maybe one one. the third

Ashion XQ last was in year? of What and XQ Ashion. contribution

Jeff Elliott

It’s quarter points April. so a during X that or closed a

think quarter of range, had of So high have And in will a you it way, that you will Vijay. a probably of kind kind annualize of year. this the another then of single-digit quarter of that partial kind April but in

Vijay Kumar

Understood. Thanks, guys.

Operator

next We Baird. from question our with Schulte will Catherine take

Catherine Schulte

Hi, questions. quarter guys. Omicron flat up Thanks expected first out how And screening looks guess, the impact would core if holiday business sequentially of guide, much weather and we your imagine like still screening is is to PreventionGenetics? it that, for be to I for the back despite for slightly seasonality, some that impact. typical having the I first, some

business would drivers can for of that through positive you’re increase? that some you that seeing talk that So just drive sequential the

Jeff Elliott

PreventionGenetics. remarks, Catherine, in QX, I my million in So $X we expect mentioned from

break through for walk you’ll that prevention. transcript, see the have the screening amount month out the then and If you we we full for

patients seek is fewer the and visit. good out go seasonal here and The a New primary typically and trend Cologuard during and that’s with ordered care holidays, a typical around point. care primary is Christmas Thanksgiving Year’s, So starting

the So that a from went to implying does meaningful QX we’re in have a expect trend Cologuard year, negative sales rescreening what down think impact. been Cologuard we’ve like productivity, our talked QX X-year a This business. about, some better has there pretty is a equal, All drivers. Omicron. from else step you’d impact force the Yes, for incremental things reasons trend, better XX, all positive very

calling access people, going did the in and should that here’s have wellness news and good an fallen sick. more physicians had well. visits the cases have And disease patients should getting as improve forward, improve the but dramatically. You impact, sales and And force and both

Catherine Schulte

it. rate electronic talked And year? then Right. improvement in about any further that you or ordering goals Got XXXX, achieving for in targets a XX this improving the point

Jeff Elliott

XX%. went the then years, we orders look past we electronic to Cologuard Since XX% over of XX%, now from X

gets expect harder at XX We year up each keep improvement to going continued points.

XX I’m So I XX we’ll past for Longer there. don’t get know We’ll more that years, of but term, couple if points, in progress be year. will will you that cost order is and a keep that, when better news know, they number the for physician experience far good And confident here electronically, the higher. us. to lower order overall well, challenging this aim points very the much, after made the more, it’s working to orders patient as Catherine, they’ve a

to back G&A, investing G&A. my again, So now in we’re on comments

P&L a business We’re build to margin better investing create this this and for grow to overall efficiently foundation, robust everybody.

rates improve IT So we’re billing electronic operations. will will higher, will making that the help it drive help in our X-year order it rescreens, investments now lift

of moving multi-cancer, layer they making part cancer IT When layer test. Cologuard So is important only to for to now because is environment, environment investment is it’s launch so keep button or allows in down G&A an or also compare new products higher we’re road. that’s the rate order factory challenging. click into physicians more and very a for to unique, a we that will big into When the hereditary to pipeline you not into that launch will companies that far a have an launch other Cologuard that, which that they that foundation watch the one

Operator

from will Brennan next Dan question with Cowen. We our take

Dan Brennan

is the of which the And does precancerous should How could question this blood-based off start a decision that or lot looking NCCN I remind that will a taking then gains still blood-based others competition come other the out could questions. how the I of If share the for focus. could is the recommendations whether impact that the very the kind you And the you in point loss? USPSTF detection for fit competition final data there levers once that’s will maybe then know be be above since to out question years adenoma into blood-based us, number likely here. it’s which, b, share a decisions of sort we Kevin, or because is while for future, question XX% their key is on of have nuanced Thanks in think do? or there? paradigm below and can a to on kind bodies, Great. just AMA an that and make screening

Kevin Conroy

Yes.

start payers Cancer most me weighs but guidelines, Let that in, also important That with far guidelines that one. American by USPSTF. USPSTF the Society follow are are guidelines

are the ones. most They recommended. the most important So, those are also

there kind have minimum is positive a impact screening. be think So, XX% just last test. test with coming of overall performance XX%, uptake just an blood-based on a of the think level at resort. It is to Well, do we we – what will required the not is of to much not of

to last today. have FIT is people still of over going you is population to it’s test test test, $XX. resort false XXX polyps Now, remember XX% an precancerous reimburses The important it a that’s with X% well is in XX% sensitive, the of test of a patient but million And about a – FIT positive. detects where

that specificity, an to a to a to take year pay – dollars. an of not some much every touting going is a multi-hundreds going as reason are people – They detects for with have but the that sensitivity So, years. false cost a polyps not it’s at have be they that blood the of XX% of to have going to are of don’t smaller impact. higher pay precancerous of it’s rate look cancers, impact. an only going X Medicare have And and No, test impact, going level percentage positive every it. guidelines. to used of at part are But I to

seven refused in to feel that So, one a the lower. about There or data not it’s show say sensitivity get people challenge. if lower going that who path yes. down going no doubt other it. XX% And impact pre-cancer don’t comfortable our impact, or colon to go our a docs who all blood all if is have passed they have to think away a and XX% ordering types it sensitivity to Is the screening. and the a is it cancer would approach, so. important colon major going as I test is is Is Is screening an specificity, we time, have We us, of this they cancer because know test. have questions we it level asked yes. blood that sensitivity at own from of

there as it a no? to Cologuard going and of is the need, coequal absolutely? standard care, colonoscopy Is impact So,

Jeff Elliott

survey test clarify to the XX%, Just the were answer said would sensitivity a there, and were only pre-cancer data the if one below XX%. order seven the only cancer sensitivity below docs that in

Dan Brennan

kind it. you right different then Thanks guys. Kevin. that. just talked Got a over of – then And question sorry for maybe as for I And Jeff.

company profitable the turning free for path long-term cash so flow the about self-financing, and think we turning as Just positive. towards

great? Is look it think there occur, equal, be expect Just what things achieve all about are that we which those is or those certain years to you markers would would along enable a Thanks. base the at just should ahead else in we to to the revenue coming helpful any as that? lines thinking

Jeff Elliott

cost business Look, go pandemic in this if we a we quickly the think adjust And I pipeline structure, model investments. pulled Back pivoted years few $XX million on of some over hit, can generated the and when show what cash. now, you back free back the of XXXX we do.

things do. fall and right share R&D. gladly will time, can significant fund IT cash time that through been that growth flow shows business Over Cologuard like time, will over with that that what So, have the all we investors. in this now and generates

starts get the forward, significant. top are we that roadmap profitability opportunity the very It in We line. adjusted as delivering with is do far we the in How ahead EBITDA there? As know XXXX. confident

that So, you few years, broad growing profit. gross that structure even cost from and labs we that further. and down some to walk additional products team team because very profitability oncology, keep here. our health, like will foundation automate over I like IT gives what’s a the systems the grow. things through. that over next at color us sales We and to will and surgeons, their as spans we strong have a Between things from expect will front-loaded give women’s marketing more with trouble bag. margin some sales improvement some When that will line. systems and G&A, will time, now incremental of billing investment have leverage fall we primary leverage That add generate That significant sales look that I top investments, to you are substantial gross help and on now drive marketing, GI, we care, fortunate savings the the P&L, fixed time.

even see to this year. start that will unfold You

the time, growth vast will driving right flow will growth in thing I good the job sources of of leverage X up investors you line will we that’s will majority the Over of my the to investors. forward, the like things allow remarks, I of multi-cancer, that that R&D, years, holding good nearly us XX% even R&D are major to investment. to is of areas new through that Cologuard keep said R&D, new the see MRD, open cash do drive more for of to think and growth. is on And I coming in G&A. think a do

have is So, allow we a in margin one steady single things there in on you improvement there internal plan series to flow and is profitability to will gross continued and laid thereafter. but get then that Dan, cash got that out ‘XX us our not of whole point

Operator

from will question we Meehan Nephron next our take Jack And Research. with

Jack Meehan

good to wanted on focus and I you afternoon. screening. multi-cancer Thank

versus and launching? NCI an have RFI So that to announced this a pivotal does that just about how recently you if the was development respond large-scale plan study plans wondering to talked you for participate RCT. RFI about your I tend and talk

Kevin Conroy

it’s have disease with are NCI to XX% cancer treated in the late-stage are that changes wants request way from And everything doing is how changes to is changing what as We badly screening and proposal, to showing a of news good our multi-cancer north you far time, Federal Today, because the is treated. just to in we XX% government because metastatic what it NCI NCI’s no good is screening responding sign. a for the – oncology. involved be XX%. largely And cancers cancers move could screening. over involvement test, time not everything through away. that’s of of here With another that is found XX% up

will studies. new And one pivotal take needed of is We will too. and going to course, a modality have guidelines screening more Others get own into own that’s to study, study. USPSTF to have because it continue, multiple their than take may our

and So, the way study we for to generate yet others are we and is NCI excited another about that. evidence,

was which program, back life. just Moonshot the is thing other brought The to

One detection President early of next reduce the was cancer Biden the things is multi-cancer that to over screening. couple half mortality emphasized way in of the decades through

So, here the involvement is NCI a step. really positive

Jack Meehan

multi-cancer you blood Great. for when colon and for just thinking was a And the test? your multi-cancer of how test. reviewing as I to a does talk view about you follow-up, the FDA could NCI Thanks. if the FDA kind timeline are change the as to on get of wondering involvement might around latter, about review And

Kevin Conroy

a complete. to let’s number to take going So, with cancer. Multi-cancer, multi-cancer these and start take of then colon studies are years

review. all to and data, will the so panel submit meeting panel have typically FDA will the have you And a the need then

to I from probably was to Maybe submission would that we multi-cancer. think, entrants are to what I approval. a approval. nine-month multiple aspiring will So, of with it there from they expect big about was, is months And cancer Colon Cologuard timeframe six have the similar submission with panel six-month data typically that a process meeting. there space since they suspect That’s do. something same. one that would the into

So, are again, process. six-month there, meeting one nine-month submissions three or And to four data. would suspect it of if that I that’s there panel all look to at there will a depend be probably

and have in abated. just been We keep the to now is COVID testing in of by submissions diagnostics office mind overwhelmed has hasn’t right that vitro –

levels and are depends projects. other are with they busy on really where staffing the how it So,

Operator

from will And Raymond take our Cooper we with James. next Andrew question

Andrew Cooper

mentioned been you the asked, follow-up for that Lots on And everybody. Hello questions. but talked the you or Thanks think passed comments multi-cancer. last to I one. maybe already in

how on like that I So, hearing RFI, greatest sort the get player the NCI from to wanted are out and one just the like latest and the what things we on of impacting sort best the LDT and how pathway just what of and down the market pathway be might go dual there. latest is the view you your for greatest FDA and of thinking

Kevin Conroy

Yes.

you Grail entrants the I of space think it like other the into one unlikely they reluctant need Their serious aspiring are test. done get are new They has Congress more about do if work this are act they that company, they want data great product you generate to type to and here because it’s one company a job. a for and than company. involved a more doing see very they than or cover to one a –

will with out are pleased How expect play people Grail really next LDT that way we an are before change to were work get exists screened tests how for have think does of we century were the and year. a multi-cancer it’s in up Cologuard we ultimately the own last year were there lab XXX Cologuard had screening a was developed groups, about different with colorectal our perceptions over of this and cancer etcetera. going to and million So, we have people go perspective, there test from with showed over to that used. There there, to screening is screened. Remember, be Cologuard. that There We a than which quarter no today. advocacy

going how approval, is for of going to of mind, to the changes question coverage is those in And So, potentially first medical going one that just in be lot year. Medicare my there FDA the everything. opportunity screened innovations It’s of first people a year many get just be in to growth. that are

in it’s etcetera. is be significant going It’s think going can you As broad-based opportunity so much I the guideline when the And coverage, to growth. there on going an insurance you be lab greater see to have that not for developed market. what’s though, inclusion, – from tests,

XX% how and It’s cancer long-term back is over a long-term going cancers investment. believe, outcomes. come to and detected It cancers So, XX% from this we treated about screen to is a screen will change let XX% it’s me detected opportunity. to everything

Andrew Cooper

items MolDX great. the Okay, for different kind is flavor for mentioned Helpful. that anything us some be or in looking they then give you what in little for to the some then nitty-gritty, to on guess for, means? can take but that one? terms approaches pipeline more are wanting data away of there MolDX may of changes because a your the I additional of any of looking And you what other And Oncoguard. bit request for

Kevin Conroy

Sure.

that’s and into the the to read-through on doesn’t put because The reason local Let be that other there the about MolDX of liver resulting developed have developed over getting wanted. And me actually our didn’t. advantage huge test. screening. permit come be – It’s put products, able Oncoguard in to are well just extends a the study just MRD making, before that And we all won’t details The And that that that lab for our back Epic is a different multi-cancer into are already to so are we easier. established that decision to we we unfortunately our coverage submit. Palmetto, law has that multi-cancer a on that complete start commercial to that. in instance it ordering, have. X,XXX test we people because excited without will to able because study lab team. hands that of approach we our tremendously is categories going liver for time

our So, on there there other of programs. I is – to pipeline don’t is liver read-through any think any

Operator

And next SVB we Puneet Souda Leerink. question take with our will from

Puneet Souda

number I taking question. guide. Yes. have questions asked Thanks ask, I the Kevin. Hi question. simplify of been the know Maybe for could the if a Jeff, on

are sales rescreens, reps identifying. COVID contribution, could associated the think there X,XXX in-person a unpredictability had general word sort and sober. sales with guide more have anything you with more number force than docs making million of the Is I uncertainty electronic prudent in, other XXX coming investors Jeff XX-year-old mean I a that million things. stronger struggling XXX of is of I you in the the new ordering, plus with beyond if use the full that year

making I wanted just last more very that So, I you is from year is just way, prudent here? a it mean a just could you just in simple clarify, understand. very to uncertain learnings if

Kevin Conroy

think I that’s Well, accurate, Puneet.

the I is we think question the fast biggest still are open again how – up. offices

for by I positive the the prudent And Cologuard we Cologuard it start is look upside saying access growth office we are to baked here variable lot way summarize a was about Omicron, the the think I through this that here. That’s, the that look at strong out – we there have this coming growth. way, good And And impact this across think as a But to that’s worked of of out offices year. – want I growth team the in to very probably is tremendously of still we year. pandemic. good a has and what is main had pre-pandemic. we The to have in a given not year. start

And a so grow From of to more X at this Megan, do us expect on base for have call we we questions? year. other everybody, least any Cologuard XX% thanks, So today. joining than the billion,

and number of year, exciting had we markets record cancer Oncotype a in growth node-positive our therapy tested last team and international selection drivers Oncology with tests. have breast Precision that with Our patients

millions updates the of growth. We testing core a hereditary year. of forward multi-cancer support tests, pipeline detection, our MRD, look to to have diagnostics cancer addition, on and we of in providing the business, cancer of best throughout team innovative dollars billions working patients early to In

Operator

concludes ladies you call. gentlemen, thank We And and this your today’s participation. for

may You now disconnect.

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