CDNA - Earnings call transcript Q1 2019

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Operator

Greetings, ladies and gentlemen and welcome to CareDx Incorporated First Quarter 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] It is now pleasure to introduce your host, David Clair. Thank you.

begin. may You

David Clair

website you will released thank XX, us Earlier Bell, the today. The Executive Maag, Good and this Officer; results for afternoon’s for CareDx Michael company’s on available financial is Financial March www.caredx.com. the today, Peter release Chief Officer, afternoon, Chief currently joining at host quarter XXXX. ended call.

Harbor the deemed statements be Reform in of meaning involved current Any of this would Safe of contained without results during including these future of should are that fact, historical management expectations to statements those to could provisions expectations making by not statements regarding this Before Litigation be are the Private that to everyone statements not within Securities differ cause made you limitation, historical we will decisions, Act place forward-looking Federal on remind material operating These our the trends, upon of statements. actual undue and Securities these our should get enrollment from or call results implied statements. financial and Laws coverage which like are that to started, reliance forward-looking anticipated that forward-looking call I includes materially pursuant statements be XXXX. statements matters, estimates and and risks various and statements. assumptions. pricing forward-looking Accordingly, examination based All uncertainties

Principles. other is future required new today’s whether of release I Exchange or with and the a CareDx by is Reconciliation also to accurate as description Accounting statements, financial XXXX. or risks in filings the Generally the business, of of not calculated accordance call filed uncertainties of contains measure and conference May or sensitive X, discussion GAAP the may see list events, over call because directly will projections information, most today, any earnings Peter. the and intention financial that update live to obligation comparable with disclaims include information otherwise. with Commission. found with This a This turn and Accepted or as financial revise broadcast call associated our in forward-looking to For now a the only law will measure please any be Securities except SEC. our

Peter Maag

had David everyone. Thanks, position our and leadership to quarter CareDx transplantation good continue diagnostics. afternoon, as exciting We we at another in accelerate

are X Interleukin use an validation with to agent of treatment the we was March partnership published first tocilizumab heart In announced clinical Our advantage considerable characterize we transplantation, strengthening AlloSure gives day. AlloSure a mediated for patients mover American Also speed we in antibody in which a use response platform of announced to a the CareDx study to Cedars-Sinai in the March, every a therapy transplant patient as of acquire software and with Journal the our used with rejection. over of Transplant transplant Transplantation. and This service ability showing tracking in provider the in the April, transplant in rejection of XX organ clinical announced heart our mediated Management; solid the an mediated study is cell to agreement antibody late which testing the is first Complete heart detect validation acute centers large to leading U.S. OTTR recipients. of multi-center we currently AlloSure In prospective leading

The longitudinally. manage to that integration closed seamless expect and OTTR are we artificial backbone transplant the CareDx EMR the that the patients transplant centers value we software It also addition ability CareDx ordering provides to a the excited welcome confirm tools integration. providing transaction the yesterday pleased increases to care the workflow for intelligence pathways. our am simplify team surveillance to proposition center AlloMap. build will OTTR the I Importantly for to and OTTR to solution of AlloSure of and and enables the

last Alex intelligence. [ph] Loopik and transplant from a and we Paris his pathologist with leading Just based Cibiltech. announced team learning Alex of agreement is artificial machine an in-licensing in week exclusive the field

beginning. a we work. Cibiltech patients team. based stratify with relationship be of are tool, Cibiltech of are Predigraft over this built use We with tool long-term on his data able closely the excited power see risk the outcomes. collaborate group's the by and for We Besides years only excited analysis this represent being brain to to strong Predigraft have transplant to start to as equally the we data the the able

Let me all together. this stop here fits provide how on context some and

we have XX last transplantation. Over been to dedicated years, the

reimbursement trailblazer and clinical a been have developing landscape. biomarkers proprietary the We successfully navigating

We sequencing based are gene next-generation for setting and multimodality the ball combining technologies. of testing expression knowhow now our

Our goal and Artificial in analytics learning Intelligence provide smart machine to transplantation. is to Solutions add

will You artificial about talk for stands which care. us in transplant hear [indiscernible] intelligence

population. caregivers Our provide will large through clinical stratify datasets point-of-care to allow them registry collected with patient support study tools our their making that decision

to to high highly complex costly diagnostics provide coming strategy is medicine a population life. tools with to precision value Our patient and

and first combines analysis our then for The community. of KidneyCare, precision at alone. Lung of rendering multi-modality both data International was tests remain April The of matter. benefits Transplantation the early was [indiscernible] In assessment either is only excited and higher but and to logical HeartCare test we tools solution, and second AlloMap the AlloSure-Heart heart the example HeartCare HeartCare really of reception combines combining testing multi-modality these for the example AlloMap also strong a Society our heart Heart not kidney KidneyCare testing AlloSure patient about transplant the allograft

prognostic weeks three in as marks providing insight Transplant step excited [ph] in next American KidneyCare the the We this at into immune Congress will five years. injury organ element also and very provide Boston XX launch few at years are in allograft survival and time, we a of the years,

we property from good potential along lead from vigorously to Now industry the our fair and lines will is inappropriate substantial back our our ensure race our conduct these of aspect intellectual competitors. another the maintaining a turning name that execution is to defend performance in contest and

heart leader the are surveillance market. fortify and We we kidney to transplant continue in our competitive and

we don't to with stop transplant intend there We product. are global and transplant away surveillance on as have our our in a we presence lung

of the contributed $XX ago this revenues service, testing to traction up in and transplantation. of quarter grew our all quarter total and up million XXX% market For revenue product compared XX% reflecting business based AlloSure, year Growth XX%, this in quarter. the segment of first growth. XXXX, to broad to continued AlloMap was the revenue product

the quarter first on AlloSure provided transplant results the results in to approximately X,XXX includes AlloSure, XXXX, to provided number patients launching results of we States. kidney CareDx provided both to numbers AlloSure kidney equates approximately to kidney transplant a for as revenue during patients. approximately effect XXXX living Since XXX of with the account X,XXX protocol. X,XXX define in first X,XXX as transplant X,XXX broad total who Demand testing their patients to volume patients the Turning which X% patients. of transplant, the AlloSure. centers transplant of XXX predefined patients. AlloSure and on allograft quarter in these as for to We in XX% remains over estimate kidney surveillance These quarter centers of Overall October well the United patients their surveillance by volume patients. AlloSure that AlloSure attributed We of transplant patients in our to first recurring XX% CareDx the that was surveillance center previous We reimbursement XX% years. helped a receive recently Medicare quarters, the previous are managed patients finished consistent quarter patients. with received with build have first

K-OAR, our patients make in to and initial enrolling our surpassed having Kidney enrollment centers goal. progress continue patient We Registry, AlloSure Outcome X,XXX

a us XXXX, the March adherence and Multi-center We to transplant target of AlloSure with as enrolled. hub our K-OAR our innovation I in centers a patients touch end in study and to K-OAR XX the as mode moment study, the surveillance would which full our through call element provide studies Dr. studies to initiated been to mention this had like XX% of also from like at protocol. standard as As CareDx drive the our the had Chief take an for of adherence and advisor extremely Yee; studies After in these X,XXX centers retire direct dialog with CareDx, Jim Medical been and role end to his we These career quarter. physician an leaders. successful compliance that transplantation, in the with widen protocols, key Officer. community. additional time opinion Jim points a K-OAR at us transplant work is to keep has sites crucial decided

sad hundreds was events his K-OAR and D-OAR launched extremely honored immense participated shared tens of patient tenure which all on and Jim and joined AlloSure journey thousands thousands results. heart move care, and CARGO of II, CareDx of our has transplant in executing at conferences instrumental see clinician in of to of patients During I'm to led but Jim XX-year have DART, has speaker this together. conversation in to developing

success team our the kidney the and peer performed of which the together K-OAR center With an U.S. Jim with unrivalled XX% transplant of our publications for on account transplants reviewed over the partnerships in

our are adding kidney transplant care. initiative integration Our our patient multi-modality to new EMR and solutions, Formidable around we Moat

solution surveillance our AlloMap. heart to shifting Now transplant

translating surveillance First Allograft XX% the care quarter. heart with increased solution view volume appreciating both of novel both of health results heart X,XXX it’s HeartCare. AlloSure-Heart, patients volumes transplant year-over-year combining the and heart test care. the AlloMap the comprehensive enables accelerating transplant by into heart adoption quarter the community of resonating This by Enabled patient in XXXX with decisions the with and

we AlloMap one pleased all Registry to throughout which April, Anthem’s nation's transplant-led in are to Our be SHORE in turning network is transplant products, a organs approximately to now and is also $XX products is recipient. covered used across of X cardiologists plans labs or a transplant report HLA in recruited match the Surveillance our XX% and world of I'm and Anthem HeartCare of to members Outcomes determine all now the to-date. for help well-received centers of donor test insured the marrow patient study payers typing the from U.S. for approximately U.S. largest very the the our network continues or with between AlloMap by bone million lives have

quarter provider product of in products $X.X our AlloSeq addition new HLA typing, order was quarter. product sequencing and Mike patient and contributing for care We XXXX. was model the impact have engagement DNA high transplant added on of the long-term and for increasing. BMT AlloSeq next-generation U.S. testing, million the the leading fortify ever to continued as discuss AlloSeq track Today driven longitudinally over this value traction manage capabilities transplant with revenue patient is to we the I'll cardiac of TruSight need of of our the by revenue offerings AlloSeq growth start population call marrow X% hand cell-free for transplant further patients XX% remains our first you great Growth Our approximately financial. to remain HLA for surveillance to outcome. introduction kidney transplantation expanding, organ QTYPE. to kit bone TX and a the solution is patient with in is

Michael Bell

Peter. Thank you,

increased year increase XXXX we we prior provided quarter. in by was first compared quarter first the services to income AlloMap growth Testing primarily patient from testing provided also significant was our the Services X,XXX million. the the to AlloSure first the results X,XXX in Turning Growth driven The came to statement, revenue XX% year-over-year results an $XX.X which quarter. revenue XXX% patient

XX% was quarter $XX.X year-over-year $XX.X XXXX such as quarter and total compared to million, for the first product prior an revenue first increased revenue $X.X XX% to the representing year’s million. of million increase Our

first net of loss XXXX. loss in the was quarter $X.X million million of net same the to compared XXXX, $X a period the For of

to loss of first quarter $X.XX was per net quarter in share XXXX. for compared $X.XX Our the the

liabilities. Our compensation value first included the stock $X.X net loss quarter common XXXX million million in a change of estimated warrant a stock-based and $X.X loss from expense fair

net our a XXXX. the was the loss For same to compared in net million period first non-GAAP million of income $X.X quarter non-GAAP of XXXX, $X.X

of net a quarter non-GAAP the net per income XXXX. $X.XX share first Our non-GAAP per compared to quarter, for loss share of in the $X.XX was

net non-GAAP non-controlling to depreciation, income interest. expense reminder loss a attributable interest, amortization, income we tax, and net define before adjusted as As EBITDA other

the For XXXX, the in EBITDA was million of quarter of a first first of ofXXXX. million $X.X compared a quarter adjusted to gain loss $X.X

expenditures was further this positive our compensation Cash was of the the EBITDA, compared during at annual and that payments the quarter March in position $X.X The start leadership equivalents the for flow primarily were the transplantation. XXXX operating quarter modestly was million in consecutive third outflow in enhance as quarter. Net quarter. million our quarter we first operating XXXX to cash be of paid While to to marks million cash incentive related XXXX. progresses operating XXXX of on the negative performance XX, cash further will increasing adjusted $XX.X $XX.X

We the to for expect flow cash continue year positive full operating XXXX.

we acquisition $X the for completed or in being to million with full-year with income Peter yesterday May to is revenue for OTTR million of cash As million million net the $X funded through and This million. to hand mentioned on breakeven. $X anticipates XXXX OTTR from $X December the Management Complete transaction be be to Transplant we range $XX expect

call Turning to guidance, and I for to year,including acquisition. expectations million revenue we're for $XXX the our anticipate to the With growth OTTR to the continued AlloSure questions. for $X the open $XXX XXXX updating million $X reflect million of will million that,

Operator

Quirk with question. Jaffray. Thank you. first question proceed Our your from comes Bill [Operator of with Piper Please line Instructions] the

Bill Quirk

everyone. afternoon good and thanks, Great,

Peter Maag

Bill. Hi

Bill Quirk

Hi.

to is upcoming or at be released. data here when this I guess question might first we know kidney on should meeting care So expect see you the

Peter Maag

have I I you obviously think AlloSure. data very we know on packages strong

I basis is So there because expression on we form transplant Alexandre waiting AlloMap field called to And it trial. we available of this a on Transportation are very always in launched the bit trial Loupy combination excited technology and was and Predigraft kidney applying as also a a on Making do is what think to clinicians and of about be before. data a and and the will of team as initially profiling gene and launched Paris available three of surprise that a out on actually I the extensively readily clinical published it iBox probably have in transplantation in

Bill Quirk

Understood. three reimbursement And thinking you the be additional Peter or should any we seeking that. would of out the be for how about combination

Peter Maag

No short for is about talking the I think the company driver really in we the have AlloSure term. been

reimbursement not strategy as I the on mold has on reimbursement strategy out in to we again be predominantly are side think laid the been street. be strong will building will as reimbursement we the transplantation out focused out soon Medicare which the laid have communicated

Bill Quirk

just great. from Okay your strategy just little And thinking me. last then a earlier. bit It's about one for

your new brought with the all. quarter you that change for to is get up I strategy deeper in existing think want adding that of versus them. just Does new call I fourth at the accounts accounts care, adding the sake necessarily kidney

deeper going make You or know essentially in broader? as Thanks. model basically as it well maybe combine you are both directions

Peter Maag

the out we these that a XXX Bill an are strategy, question lot of – to in converting a going centers transplant good thank very established much, no and confirming see KidneyCare surveillance see it’s our completely think is we centers I you deep centers centers you that there now same us presence these for we this our also in which quarter is into into strategy play and testing. have opportunity XXX

strategy the execute think against we – strategy, no I to to to is the change continues strategy the there working. out is laid that So our path

Bill Quirk

guys. Okay got it. Thanks very much

Operator

Thank you.

proceed comes your line Couillard of question the Please question. next with Jefferies. Brandon with from Our

Brandon Couillard

afternoon. that about to thinking with ordered would users XX% the change while perhaps terms volume of it’s that thanks, the like start that breadth you do docs I XXXX. in at all the in and year you double-digit good since and for how or sort for the a Peter business AlloMap of growth sort we’ve centers have of to that then assumption the penciled been you're or relative spike does there actually – out quantify perhaps of the AlloMap mid-single-digit growth HeartCare from growth impact seen could Hey

Peter Maag

excellent an that’s question. Brandon

palpable in centers Congress expectations we however that of have bit a the heart study adopted of see the first and our a SHORE primary our driver felt in excitement is transplantation paradigm I think the you see HeartCare we was was slow growth registry this exceeding previous the is the was year. changing and to the quarter for actually ISHLT actually of the great quarter in and number the – that really

had year. heavy, last catch quarter a few outwit in a that northeast days up heavy second bit in So a were leading storms of the we to the

to to double-digit quarter, happy volume AlloMap this for So continue obviously volume growth but growth range. think modeling we we for for a look AlloMap. this mid-single We are the continue digit mid-single about digit be I in

Brandon Couillard

Thanks. and deals. Then the iBox couple on OTTR

First to think how of test AlloSure require this sort – or take of you OTTR, ultimately sort for drop AlloMap? of is that data sort you the it’ll into approval build on long be functionality do feature for or this incremental then can results? able something iBox, to of is AlloSure that direct ordering and in would And FDA data you a just an

Peter Maag

Both excellent question.

measure then a I OTTR AlloMap but for virtual us is some AlloSure and patients adherence to skipping out actually great sketching sure there for hanging low and a the will take the functionality surveillance will to and think centers the centers that that's fruit regulatory a that will strategy. that mouse then and think Congress. I we'll lot think at make is Longer functionality out we'll updating options the think by kidney is OTTRs actually this. patients strategy to to FDA these option. Overall, as the include informing is with an are think the is easy be kidney DNA immune and hit be hand or Transplant In simple be to AlloSure realizing launching of yet. now opportunities is regulatory actually team longitudinally activity. and of AlloMap that adopt at we drop-ins the having really not include is terms the shifting allograft longer But strategy artificial on to over primary injury term monitor I I us testing of AlloMap this function there cell-free with opportunity for may that eyeball. having AlloSure which marker community may don't intelligence opportunities have they’re significant few reimbursement term That compliance American how ongoing FDA; quarters an for care Having it And would patients. a then And as stage. focus. kidney I excitement And the obviously care, for long test exciting prediction progressing click. there the together or about it we detailed with be to allograft the leg increase it transplant on transplant and it's reimbursement the the the on testing as contribution to be the does on the quick. the you a centers one and very third than The quarters in right

So multi-modality exciting concept this for is testing comprehensive very us.

Brandon Couillard

first then the how these expenses of sequentially margins the from Mike, year. more one the for helpful, Should we just Thanks. in sort guess quarter we expect expect should guess trend and expect, It's then I gross of for of terms and I the the outlook operating balance margins. thirdly, and orders full-year positive how operating over EBITDA the impact would still the will for year to

Peter Maag

would end about be the the on from Brandon, look would the at QX, expense, in of expense operating I expense by say was about million. a in I non-GAAP operating if $XX viewpoint $XX the that year operating QX, million, Yeah. it

rollout about we’ve other And our and we rollout million, as quarter. $X a end by marketing that the and previously. $X and about QX, by of team going fill being about show probably expense sales the would K-OAR talked continued the driven of So increase million of

be getting we'll couple expense next full quarters. for of over the the those And so

EBITDA margin from impact guidance small margin –throughout gross revenue full targeting an though, very a still – overall. with for throughout a think AlloSure to EBITDA the be from very, I and increased on breakeven margins be guidance, on is that and perspective, EBITDA to positive perspective, up very from we’re year small increased going a – the revenue impact our so

Brandon Couillard

you. Thank Okay.

Operator

Thank you.

Please comes question Craig-Hallum the Capital. your next with Ostlund proceed Our of Per from with question. line

Per Ostlund

start Thanks. out I Jim retirement. And want to everybody. with congratulations his AlloSeq DNA. Good to afternoon, on well-deserved

of some started sketch assume on a you're that, XXXX you pretty your signal and strategy, from go-to-market that's focus at presentations good Have Peter, you plan much for guys help how grease you market know areas whether week. skids I introduction. this of of you this get with to the infrastructure So does that out, sort EFI that are thing and to that it's in Allenex the to very much geographic product? for acquisition featuring pretty, that the sort

Peter Maag

setting excellent you thank and the on for much question Per, business. product so light

success today excitement U.S. cell-free be is be Congress to great actually the I'm our it's then in outside bringing, what the at network with everybody adopting DNA that are is States, distributor transplantations could together to as the So the see and with here to and Portugal the looking AlloSeq to our obviously team DNA is EFI see then cell-free bring United of about, testing. in this and we the at

And actually the one is is one the then exciting. AlloSeq XX, are will is would strategy that we U.S. typing same a other found way two We free have Tx in which very cell so product, the our be theAlloSeq’s DNA the we that in launch which launching HLA market products,

the use really soon year -- us very year revenue and reimbursement. products are will in relevant it strategy thought product -- in is and sure relevant then very, We maybe don't to take of be long on their them to for a that and with that we inform very revenue get think be study the acquainted around will surveillance these it'll and this important how are vendors very but hands this middle getting in market. be We clinical make order excited transplant next a in setting into launching this to this the out we

Per Ostlund

and the you XX:XX:XX the building utilization Is you've we'll good. telegraphed I from to and seems noise quarter you the out any back market in nicely. very, you've think mountain the in very some have well of call guess one XXXX the to competitive competitive that have on you. terms noise periphery that order at I centers domestic of impacting it XXX of established be centers. Is year impact yourself up you this ticking any it that know current the kidney activity very those ordered know competitive to centers AlloSure there ordering Coming and as I Okay - of yet that's AlloSure XXX is having in guess

Peter Maag

I mode as No and to free I then is there have think we're not answer testing the transplantation executing we widen our is well. to in No. that CareDx that really first clear excitement someone having we and talk that growing advantage cell is is are negative do else about for we DNA think for of provider this mover out moment I solutions the working at a strategy couple have is execution noise here predominant companies these now the now. this as us stage. we and which quarter There are this against are supporting and I advantage first capitalizing of efforts solutions that think we that just think continue making right and our it now have are is on is demonstrate somewhat do a a really our mover the there

Per Ostlund

of me up bills actually for care. question to follow Last Okay. it's and kind kidney related to a

essentially to coming in suggest SHORE a test? to Peter of a up few of adoption kidney forward would that version multimodality looking that that weeks. So see probably did get center the launch something here you

Peter Maag

that really combining exciting generating approaches do if multi-center prospective and the and followed of and a information different that of we a support to, are kidney out have do which evidence we with company you three very always initiative. is concept concept patients, surveillance and valuable responsible new clinical a scientific would really to If science bringing the is an the to are based right way in way we community based with to

great will than been to there addition a to scientific just and biomarkers biomarker us digital clinicians something and is novel has in XX on X,XXX and evidence from for K-OAR these novel patients, how As think potentially build K-OAR recruiting more I change a are allowed that to such than more these build how success transplant caring continue caregivers with centers patients.

Per Ostlund

you much, Thank very excellent. Okay, Peter.

Operator

Thank you.

comes next your the John proceed question Please Raymond Hsu James. Our line with of from with question.

John Hsu

off somewhere organically increase Good I with the guidance afternoon. the just the $X to that could in or range, was I looks OTTR million million from $X like million ex-software. the with the If guess start $X to million raise $X it

start business increase or where strength of the with what's the in really and you're So the organically seeing maybe could the Mike driving in revenue you Peter kind if guidance?

Peter Maag

So I'll closest it, the number. Mike and to the to Mike? talk he’s

Michael Bell

mean, acquisition of the right. Yeah, other growth. being the the John, of Roughly continued think on comes expectations the really, by half I you're AlloSure that I growth from think, is the yeah on guidance, I really driven our OTTR,

think slightly guidance increased I and again for we the our AlloSure quarter, expectations not to the exceeded represent so. so

it's yes, So just AlloSure. continued acceptance of

John Hsu

but seems of adding, would mid-XXXX? just it longer it you've looks targeting know patients might are are tracking still there, it. based extend it it pace the because patients the the based bit X,XXX been pacing that, might, imply that that like pretty you little you on Got a And K-OAR on than like then just, just the nicely study, things to turning that

Peter Maag

You against by patient about recruitment that to exceeded a end in they'll we talked X,XXX there patients some target, have quarter this X,XXX, March know X,XXX you fashion, good right a I June take you're the originally this at of we think be recruited is early, the had that know that and time. probably now we in already year exceeded a

standards recruiting. are not fully some will there think be I that

go in in you or centers will it technology. – were between vendor in will beyond and very maybe and a be at an center see it are we so we and range X,XXX are this there know, adopting there seeing continuously and recruiting additional if about So the X,XXX being XX there patients, be way, excited these of June. patients And XX

insight. centers are additional to there some want gain that Now do actually

protocol So now with which the will really a extremely kidney itself in is the a we’re where recruitment that's for also so are are But surveillance X+X+X protocol or how pleased established increasing K-OAR have patients company. few accomplishment we option. actually key has we XX centers centers the XX transplant using an in from XX and transplantation, patients forensic to

John Hsu

fast if and little will Excellent we guess just that could If KidneyCare I enrollment. on a clearly enrollment. be forward incremental then just there some we you stay bit said on

just thinking so high K-OAR. do to to most of typically or the on volume kidney looking typically So – XX the centers call year centers patients about XXX are transplants I it XX these know to again XXX enroll centers which a up right mode

So it is could some of overlap patients with registry there call the the a of will up sure study another rollout be in right it that you way once you associated centers. to lot to think and reach potentially XX KidneyCare these about that. I'm

Peter Maag

has adoption three how information broad markers AlloSure I that surveillance on that on can make next we accustomed Our we’re get and that the that centers centers now strategy many been surveillance development accumulate in a think [indiscernible] with we used think discussed the data protocols I always based we providing. three are through a that this we which coverage with protocol providing have have points these study there based beyond study K-OAR the is sure to study Medicare and transplant have the data based we that or

get penetrate about guidance our And many lion's to it a possible talk in think goal be a this in share that's XXX to even of probably per to we'll that. centers XXX some substantially and transplantations kidney these that ATP deep more centers XXX and you is But so I defined and really year following as and number of up go give year on as

John Hsu

nice gave thinking replacement] of last added the Clearly quarter time then combination breakout of the great. just quarter. last kind patients a very patients Okay [kidney patients just patients plus really then you That's one And surveillance plus a maintenance attrition. it's true-up of me a helpful. KR about in for first for and

but you. can Obviously added I you the patients us think math KR on about could maybe you if help we based other just the help think just pieces So don't into us number. specifically about know for with associated back ballpark that the Thank three can the that. KR

Peter Maag

sort and XX% rate in of that the one quarter than of first so segments we saw similar sort think patients first Yeah attrition roughly patient year XXXX again was this newly was yeah The a split quarter similar as previous out again was the what attrition which XX% around more the John, surveillance movements very I in in transplanted before year. ballpark. between of patients was as

yeah in that the patients quarter. mean an XXX I surveillance approximately So addition led to new of

John Hsu

Okay, great. That's helpful. really

quarter And just terms care you any for front from some and renal a last seeing the Secretary movement know Are Azar alluded we comments to movement in legislative level. some sorry around just you made Peter me. last of on one

maybe starting the know to increase You kidney of in terms availability of organs?

Peter Maag

various in issues great think, talking within anticipate Washington, kidney spearheading kidney HHS based this that that, at really development of come very up we hasn't the do cost can in I current dialysis. that something it's effective about ours broad issues that and months. the support specific last contribution out versus I off do is momentum transplantation, very There the week exciting there actually is there. of spent transplantation that to a something field is around we clear because the setting the yet actually will months to next as come three six but

And at relevant issues donor there that don't momentum, the year, transplantation – it forward that us I tailwind things for see field. helping population will a so and going a is share increasing gaining type transplantation this of will long-term will exciting will as so be an and we be – to be positives speak. these I lot and of think company this think is the be but

John Hsu

you Thank much. Great. Okay. so

Operator

Yi with question. you. Instructions] of H.C. Please your Our with Wainwright. the next proceed Chen comes Thank line question [Operator from

Yi Chen

revenue question. anticipated million you anticipated is, first also million or simply taking to higher the the driven acquisition guidance question Thank – is which raised my OTTR, My for it $X of previous has is annual than test revenue by prior by of driven $X volume?

Peter Maag

to over Yi, for I’ll hand it guidance. question. the for – Mike thank the you much talk I’ll very

Peter Maag

The is Yi. Yes, from increase coming OTTR. half is roughly

for to $X to since May probably acquisition, something that $X like revenue for for looking the at to full OTTR. from So year $X coming through million million OTTR, some million million $X is December we’re so the

AlloSure sort for guidance and $X the So expected from the the is million about growth which of the in coming increase midpoint delta really is at that. continued of

Yi Chen

to the top Got revenue it. iBox line? expected to add any Is technology

Michael Bell

year we kidney regulatory think as about here this as product right reimbursement the concept, haven't say which a from the combining I It Predigraft now I now. would and iBox – right path for product the don't for contributions technology expect concept is a is care year. AlloMap we’re for heart encapsulating the a the talked is contribution for where for AlloSure we care this really and sure to similar a

Yi Chen

from and Got it. much years? impact we And in should expect coming some the of inclusion how Blue the Cross AlloMap

Peter Maag

us very and that think than up than contract to and back that going which I issues positive in XX% negotiations Anthem do and are everything allow – AlloMap diagnostics. and reimbursement for every transportation rather now turn more and going value under being AlloMap that that a there them on a I'll see network sets we in having high with battling we as reimbursement and key Mike. back signal

so of effect that Mike see a to you signaling the important impact. to And add very if want we

Michael Bell

a represents been you. for sort so We've getting. of positive X% Anthem Yeah AlloMap for we years, AlloMap several just coverage of have AlloMap on from the had Anthem decision for under

have getting We been paid.

the getting wouldn't network paid we get so the Anthem last we've expect I get a the course which that at improve Of to again of paid getting it the much basis paid a and longer in over we've revenue speed and few been regardless years basis paid it'll of on impact But network network takes being simplicity. on out because been time on

Yi Chen

regarding question Natera. litigations final our And is it. an Got against update the

Peter Maag

Nothing Natera the those rest month respond. throughout were has roughly specific we've time a to still month - ago. litigations order in this of

So there's response been no yet.

this. on movements no So

Yi Chen

you. Got it. Thank

Operator

turn back… Thank and this Ladies questions. like at I'd further there are floor gentlemen, the no to time you.

Peter Maag

Thank you very much.

Operator

and today’s teleconference. you. this gentlemen concludes Thank Ladies

this may participation. time. your you at You for Thank lines your disconnect

CareDx (CDNA) 8 May 192019 Q1 Earnings call transcript