CDNA - Earnings call transcript Q4 2021

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Operator

Thank you for standing by. This is the conference operator. Welcome to the CareDx, Inc. Fourth Quarter 2021 Earnings Conference Call. [Operator Instructions] I would now like to turn the conference over to Ian Cooney Vice President of Investor Relations. ahead. go Please

Ian Cooney

on thank CFO CareDx and year joining today. CEO; currently us December Reg at Good President host Seeto, financial you this results today and available is release released XXXX. Ankur and company's for Earlier website XX, www.caredx.com. Dhingra, afternoon and The for the will the ended call. quarter afternoon's

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

XXXX. projections by conference obligation, any and only disclaims please or update The accepted found Securities except today's the Commission. include list the call accounting now a in revise will measures statements, whether the generally and and This or any the other filed to most accordance to the not see this that principles. or February turn GAAP intention are calculated new as of broadcast business, or financial also financial because SEC. today, information, to in provided For of information, with to call Reg. our speaks in of required financial events XX, live earnings information discussion may risks filings law, CareDx associated with directly uncertainties descriptions will our the a with comparable over be release call future I otherwise. forward-looking Reconciliation certain measure with Exchange

Reg Seeto

Thanks, you joining Year Ian. for Full Call. Fourth and XXXX afternoon, Good Earnings everyone Conference and for thank us Quarter CareDx's

COVID after group I want Before start, thank tough over made last but all patient the I years. been of two two this tireless community during vulnerable the your efforts difference looking transplant and treating to patients. for a have It's efforts the years transplant a

to transplant in We solutions outcomes played over year success revenues our consistent are At a during QX with do innovative of quarter. the the our proud growth quarter, transplant vision $XX.X XX% but a patient revenues the CareDx, million, in was journey. we not in where mission representing of the on patient have the just of record delivered also of providing transplant our we prior ecosystem community measure role being delivering and to with difference leader make another

of of transplant of volume sequentially XXXX, the and testing down quarter XX% QX. to year-over-year XXXX. XX,XXX For growth with tests, revenues record a our we straight growth year X% kidney X% the XX% QX full second $XXX.X Omicron Notably, decline versus of fourth a our full XX%. representing as of the achieved, saw heart the result was of being transplants volumes, services volume year reported and represented versus initial in quarter This sequential surge growth down million, impact despite QX led

the believe transplants increase term however, of could longer organ we the Over number nearly.

xenotransplants. high-risk double kidney, could organs, increased in of transportation, use donors, in improvements logistics, initiatives through living example this new and For government

is who this revenues and Products to quarter the University of out xenotransplantation, XX% respectively and other in and $X.X business we've Maryland and be of QX with year-over-year positive the xenotransplant respectively respectively. revenues $X.X first $X.X pig Services year recently EBITDA and team, Testing proud million This million we an full the top were a of team and Adjusted growth for $XX.X of completed working $XX.X top XX% million the with to revenue contributed the million the built exciting achieved delivered We digital is successful team. field On xenotransplant heart. and a negative and million fourth line. and human

an profitability spend. in increase by legal QX Our was in impacted

strategic our continued goals. on three During QX, plan, focused on we

three, and can further transplant more enrollment. ADMIRAL Kidney use moment. moat is our the these to around the first, was with to innovation over and On which with leading goal patient underived of one improvements bar and real-world patients. surveillance mode presence competitors; our theme. transplant competitive the exciting clinical the was years conducted show prospective digitally deepening XXXX multimodal raising around competitive our we from connecting The about further the evidence kidney a X,XXX XXXX resetting with Further the adoption in centers; protocols long-term utility. stay AlloSure's the further patients OKRA the both This excited ADMIRAL the kidney AlloSure has ahead real ability we centers support a and deepened is innovation testament of with by continued use. extending results standards generating I study of we're completion in With data. now reflected outcomes how of multicenter heart lung. XX standard commercial in in a In will kidney, have Care share in in saw in now only success strength to and recent kidney AlloSure our have cell-free to to The bring one largest DNA centers with publication AlloSure publications real-world settings for been we test three brought. outcome covering improve new across to two, commercial cause

of saw The greater rate are heart, MolDX. At by attachment our test response XX% the multimodal proud we In heart. the care diagnostic and scientific hard reflects improved the to approved standards. utility. clinical to only CareDx, than value of incredible Now we first

AlloMap, it's been with For been and competitor's to support that leading their guidelines of international in Medicine releases New the journals claims. including is the pay England Journal publications than more FDA-cleared coverage. slate of example published or Contrast incorporating recent has the no with XX% extensively with press substantiate

by gene and has data do patients built transplant evidence have to been published right We approach. multicenter that generated showing and using the from earned trust by community the of so way prospective the real-world in a

thrilled Lung AlloSure were launch We support unmet a lung. to to significant to clinical Now need.

as years. paramount lung a CareDx, at been think fall allograft bringing the a two market, centers AlloSure when within this team well XXX XX% Lung, for patients last Achieving lung has patients as transplant objective need that built innovation to over test the transplant penetration for and in heart the we three results months community a patient the than with within decades. and within smaller have Although especially two the you trust commercial of still in was testament AlloSure to the will true five established one

was developed XX% competitors for AlloSure derive transplant-specific NIPT cell-free patients. our designed all chromosomes. not than some test a to and cover whereas designed was test. repurposed chromosomes transplant and cover somatic for less Importantly, of don't use DNA Moreover, we're

set raised particularly competition, on remain to and the ahead with innovation Now, of data. bar goal to has XXXX X. real-world continued CareDx during

now is multimodality utility health future signs through already when perform stake. our publish AlloMap improved moved our of this clinical can services balance real-world of We liver validation and the clinical are following QX, heart lung. We've achieve kidney upon at we be validation for portfolio as clear data. to and of proving were the wave investing and next the that that innovation in organs testing and we're across to test excited patients In is transplant Kidney relied to with expected strong multimodal

gene need vital needed more and and the a As alone. expression is health rejection to that assessment the and Kidney test comprehensively Data current AlloMap AlloMap health. kidney test standard a the Kidney Kidney provided immunoquiescence, identifies reminder, by than comprehensive risk care to AlloSure of a biomarker offers blood-based of immunological assess allograft our

We of test long-term underived reset up patients the risk improvement ADMIRAL cause. ability was a study with novo X,XXX two, thresholds multicenter centers over and bar in serum DNA donor-derived rejection. kidney associated three elevated also This standard at we with years. DSA subclinical demonstrated and leading that is XXX% surveillance demonstrated real-world utility subclinical and mentioned had transplant in for a incredible for rejection was to Based both different injury relative XX% antibody from publication, DNA first was formation. clinical the AlloSure clinical scientific of with more on strongly correlated up allograft transplant retina care AlloSure through this the ADMIRAL. over and and than AlloSure. cell-free to following increased seen cell-free Number which kidney seven earlier followed two differentiate AlloSure showed in demonstrated and de

again of we that and are known on of XX% demonstrate new validation. multimodalty others only Thirdly then a By for identified And the and low further AI quiescence in strength over incredible over clinicians the data ADMIRAL setting. with in its was to innovation AlloSure four transplant compared contrast greater to less the under in accuracy than kidney in now an test around we XX% We these these of persistent clinical transplant than a for built demonstrated than retrospective further changer we've being rejection. NIPT the the and kidney function. buy-bank AlloSure the XX% the identifying single-center is improvement offerings which years, are are have decline creatinine our banner. allograft addition has levels eGFR believe with long-term creatinine and serum moved a will needle test for and over results base greater patients need persistent to game this standards three who Notably shown in improvement in digital CareDx a monitoring elevated a correlated repurposed At absolute with that of study levels we AlloSure eGFR with in score. the

on to Now lung.

reduction surveillance also detections surveillance AlloSure to noninvasive X% XX% before repeat again, a surveillance as dependent just AlloSure performed. early function biopsies. protocol XX% patients. transplant surveillance I'll published surveillance entering These the to can as treatment find through real-world setting. with an with were biopsies that compared recently tests that of also for enable the raised was the This study home-based NIH demonstrate study the We also to a real-world asymptomatic lung NIH-led the of recipients organ This documented alarm during the infection designed deck scientific use transplant demonstrated AlloSure lung done prospective in signs now pandemic. rejection on identified utility is compromised. multicenter lung These lung tests ability graph subclinical curved reduction. and clear in a of in barn lung of to

We that's I'd two transplant with company and we're like we publications patients. a journey progress We're patients only like the the transplant with goal donor the highlights are during our lung goal are in using company share There are to things our And and goal two transplantation. connect these the XXXX. lung sulfate today. two long-term company using developing I focused significant our and but was company study. would that multimodal donor-derived only solution and publications patient highlight on with in is to to ultimate from the to the XXXX. third it many only transplantation Again only patient ALAMO one connect our made first already enrolled the sulfate

through group more the to more use clinics XXXX referred our end centers. dialysis XX connecting built have of patients report the now have than XXXXX pleased XXXX is I'm and dialysis than first to over of TxAccess. transplant we TxAccess The patients dialysis the ability transplant at to with and new acquisition a practices centers aimed at we

patients QX Secondly AlloCare the XXXXX with alone. were Notably and connecting our of XXXXX we year the over accelerated more AlloCare on patients strategy XXXX added of patients our than transplant app. the during QX ended in

XXXXX have RemoTraC. access patients addition who direct have In to more we than

digital and digital digital we've the and business of patient to multiple the and be topic the solutions. solutions on patient digital acquisitions digital given While renamed

patients. build in XXXX in And two goal this are towards managing and progress with We in benefit transplant our will one we in outcomes our recent really medication to award ultimately delivered segment improving acquisitions from management XXXX. continue of as pleased the revenue we

Our now suite care the transplant covers applications throughout of continuum of all patients. for broad utilized offerings digital

us moves or two meaningful and recent of leading after Med Action in Our Pharmacy medication acquisitions business the infection Plan adherence is Transplant most of which of the way very a third graft rejection. the into loss cause

our ecosystem vision long-term is of towards us that of patients. propels of the of leading our transplant of at continue improving on focus execute outcomes transplant patient stages value the forward being all to partner As we goal the their journey adding

the year a Now was product business. moving quarter the XXXX indeed products a for QX to successful and and team.

full launches as and with Therapy business and including product XXXX, continue this Gathering of equally transplant been further of in known AlloSeq patients this For business and drive otherwise growth are to the this Cellular spotlight, product about fourth AlloSeq to and expansion a over less partnering to We're XX% auto business, XX% quarter meaningful as year-over-year important respectively. revenue year And pleased XX% are as business that interrupted and to the increased geographic Transplant now to has XXXX in revenue progress versus we our pharma we franchise looking respectively of scale. part COVID the forward comes technologies. from after say excited CTT. the

term, initiated multiple the building progress more Although pharma this during course to forward revenues of We the are commercial partnerships look and longer make partnerships year. new XXXX. continue we to during

we are as reflect continues its Now transplant. another to and record even how delivering and on year, revenue we're by extend but XXXX, pleased, CareDx pleased more by quarter leadership we

at including, coverage the Investor SHORE and catalyst-rich KLXXXX one of CMS, Lung the connect launch goal be publication multiyear the our UroMap, and year this Allovue data two of and XX OKRA by the transplant of in AlloMap another will ATC. the to Day, Kidney, mind, is and readout during in patients. data of next of With shared months As journey our is the AlloSure that submission a ISHLT

our and rich opportunity set heart evidence and part we be growth execute innovate and SHORE will studies world up five-year and by our journey. catalysts are As respectively. kidney, exciting sets real with us patient year as of reminder, and both a extend OKRA capture multimodal connecting in XXXX to an the to to have this demonstrated leadership that continue generate plan to in that to

turning and in to to issue the about. Clive discuss harder Program of transplant thrilled study Transplant recently at and the care and Calder. the in MOTTEP, and Directors transplant. NIH. in and meaningful America's on call Scantlebury impact lasting a or Board to Valantine, And of thrilled It's who on founded also an of minorities by equity parts members, the African-American of in one adequate with like is be working spend equity it surgeon. high-risk also Dr. is many be our who is Before honor over Velma joined we pre-transplant the the receiving Diversity a financials, need transplant. We're improving mission working services working often Board we the Valentine Ankur and and Equity our I'd Dr. provide with at who moment Dr. to the a of her. real deeply of as transplant with honored transplant Both We're Dr. but be CareDx thrill accretable with The with wealth have Hannah working a female a expertise to announced Education Head time to partnership us to Scantlebury care. work make first Organ/Tissue. and helping and Minority recently Dr. be MOTTEP

I to Ankur. Now, handing over

Ankur Dhingra

Reg. Thank you,

financial XXXX. the We quarter we journey very the in progress fiscal the performance our making and connecting pleased results and transplant patient of fourth are the are with the business, year for

new results, for year and some thanks in our of portfolio. our growth next about our offerings strong our I'll business proven year. model first acquisitions our exceeded of give our and The you plan meaningful adoption then details financial guidance our businesses, tests to expectations, broad-based across to growth five-year adding

AlloSure core in heart across For as up for as volumes we XX% We $XXX revenues XXX,XXX the million well adoption strong total to with strong $XXX year-over-year XX% our XX% as grew of compared launched with launched revenues the XX% portfolio. million our above newly million was revenues to rates achieved recorded position. excellent million as XXXX Services, XXXX, $XX our QX AlloSure the revenues by an $XX very increasing contributions Solutions the increase end demand. Product tests. Lung XX% to solutions year-over-year for and by XXXX. grew market-leading Testing year. to to testing in the year compared NGS-based attach of approximately approximately saw plus $XXX and were Heart tests grew throughout test, Patient kidney Digital typing million XX% an of to

compared in to during our in times XX.X% lower Each margin and well tests. with non-GAAP AlloMap excellent same feel due $X.X our increase expenses reflective Plan demonstrated spending and tests, also CareDx our $XXX team. sets for by the scale of capacity gross QX. margins of strong and Non-GAAP strength We for of the launched Lung. healthy Action XX% up from good Heart AlloSure approximately Med we five-year $X This revenue acquisitions about margins last was This the by Adherence year solutions XXXX multiple by expenses patient also our and has our were in million million in increases us as growth. were organ to our COVID the intend making an contributed in added were strong adoption of Kidney Pharmacy derives legal plan. business, digital XX.X%, of pharmacy very with revenue is services Non-GAAP QX to factors margins. operating profile despite up which $X.X growth our with and the gross We're have expanding our up million, about playbook We and the our was And over million. Medication $XX.X This declined we solutions. Our our Non-GAAP Transplant transplant apply execution offerings far million, gross the to when XXXX. quarter and The exceeded core from performance are achieved expenses volume fourth AlloSure to investments XXXX. year start Heart to revenue patient compared impact strong the of QX new capabilities we Laboratory. tests also gross has various operating portfolio quarter sequentially scaled AlloSure Brisbane margins to in for newly driven testing very XXXX.

portfolio, scaling as trials sustained new at the During of we and portfolio growth. business aimed also all infrastructure, our services invested in reach to building our this our invested year, expand our clinical build we commercial started long-term expanded for

recorded For we legal the million, of of EBITDA disciplined increased of EBITDA $X.X $X.X XXXX. We fourth impacted in the fourth profitability XXXX to as Reg quarter negative remain compared our investments. And adjusted quarter was our by of mentioned, million adjusted in spend.

cash, flows For EBITDA during to the of over XXXX, sheet, $XX.X marketable adding adjusted with EBITDA and products With portfolio We've of of remains deployment journey. $XXX and our the securities compared cash in our of services $X on ending year we year marketing the billion $X patient transplant equivalents million million. recorded balance quarter cash generated million adjusted across operating XXXX. cash strong of also focus full

we our execute their During continue on acquisitions transplant in artificial testing to supporting Plan Action as for position we plan. in develop our XXXX and All multi-modal multiyear Med business. the our in patients growth Pharmacy journey through through Mirametrix and We TransChart, Xenotransplantation strengthen intelligence invested invested invested investments services. of these to in Transplant partnerships

of a that to have investors top of topics address couple call. been like Now QX since our mind I for would

in AlloSure materially Medicaid The combined success per Heart growth in test commercial ASP. of affecting growth our growth. outpaced versus realized first resulted or The higher revenue strong that is XXXX amazing with very volume of volumes ongoing price a dynamics

changes we last kidney with saw In the shift patients plans Medicare Advantage to from addition the Act year. CARES Medicare testing in introduced for

XXXX We for a should XXXX of in in headwind these average rate. expect launch some hence a go-forward not annualized trends but and was AlloSure prices. lower persist to at be Heart QX

XXXX. coverage opportunity and continue business adoption Strong for on with patients focus our testing lower growth our a commercial contracting Advantage seen our commercial to of of continue at With created into has significant in and shift in across to us. higher services plans plans, rate albeit to Advantage to very tests. payers expect increased We Medicare both remain Medicare commercial more a range

as Our goal turn XXXX. into going work in into is tailwind through a this XXXX we to this

agencies The second XXXX. information is government we that disclosed in the request from

responding We and in moving these expeditiously requests. are cooperating to

as utility are in management Beyond you team our market on running we limited that in We sure that services and understand, can say. I'm remains what business. innovation confident products focused the our the and remain bring clinical can to we quality, and the

on to XXXX. for Now year guidance the

full annualized the last range we year $XXX For AlloSure Heart the XXXX, million to the revenues We of million. $XXX expect in launch of quarter.

is AlloMap expanding using assume Our core winning our double-digit our does This on nephrology. revenue and adding of guidance franchise formula and Kidney. and built guidance contribution protocols centers in into growth kidney from not heart

of the well end transplant volumes. guidance on testing low Our as assumes impact impact continued procedure on COVID-related as volumes

into saw guidance This procedure January a we of from lowest second transplant decline high long-term in we has reminder, volumes to decline faster of but strong well formally month XXXX February, weak end which early high the a single-digit The beginning of some seen procedure a and in half in as grow transplants since to rebound testing in of demand continue number The transplants rate. we COVID. continued at later having part believe led to recovery As We've a transplant growth resumption of realized which down. in. overall volumes volumes assumes remain commercial expect in prices as declines still in volumes assumes trends XXXX.

maintain our intend investments approach we disciplined growth. as for continue Regarding to we to invest

our that position, year been our focused on us We CareDx. opportunity kidney I'll upcoming about With and excited open front realizing strengthening businesses. grow With fantastic products our a our with XXXX company questions. of market the and that we significantly tremendous a catalysts, published, the clinical We made we're our connecting patient opportunity. several adoption several very to acquisitions utility call has lung XXXX. journey and strong of excellent for saw in transplant focused portfolio. services data As have only for and on of remain test demonstrating

Operator

The begin now [Operator the question-and-answer comes Group. Please Capital go will Craig-Hallum question We Nowak first Alex from ahead. Instructions] from session.

Alex Nowak

afternoon, Good everyone. Great.

included are lung guidance you all Are color for that Just in that the to given just what's appreciate included. stay reimbursement assuming not the there But you there? what on comes curious in. was assuming

think you I also volumes, as what we far understand transplant are the assuming as but competition?

Reg Seeto

of I'll I Lung the here. with we're just including really mentioned guidance. -- Yes just I phenomenal Ankur sort the a excited AlloSure opportunity we launch might mean had with about us QX and over think completed for SIM in I need as I tests now what's about XXX talk let

Ankur Dhingra

Yes.

from lung on contribution we growth question like or our fairly test minimal assumed minimal. in lung from the of to your X% have coming lung range something Specifically very

Alex Nowak

I've then And And about what follow-up Okay. on got another then competition competition. there?

Reg Seeto

competition Alex lung side on overall? the Sorry, or just

Alex Nowak

factor is Just factor guidance. not you're a guidance in in no competition composition overall the the if assuming and a what

Reg Seeto

we we're as our maintain assumptions our Yes. assuming maintain No share. with we

in was beyond seen in biggest last the which in heart. put was impact happening been XXXX saw XXXX last back time was Ankur kidney that I mentioned tests hospital we system to think The and January March just we've have in that. then the the really ways you time reflection lost go in what's

reflected calls in trying think year understand I the was centers nation significant for around been transplant of of also happening. the and start seeing that across there we're what's impact that's been the a to sort So

a of impact our has assumptions. So and driver biggest the been that

Alex Nowak

it Natera strong upward That where in a And that's they Okay. volume cost out XX% on came makes it about It but right kidney now. looks like you're sense. actually on like their broke trajectory. going like then at on their looks of call looks at is volume

maybe like just seeing volume. competitive an So certainly some the strong impact, environment. Natera It seeing seems broadly comment but on you're not

Fisher that? So your thoughts product? Biotech that Thermo between the what And around means on then just year just UroMap end deal any on and thoughts

Reg Seeto

Yes.

think the done it's I good to that. think, I with have breakout,

of their they've are is X,XXX that is see which what the I initial lot you'll studies think typically patients. registry a done,

again back volume. think raise want it's commercial probably I separate I'd that's you to seen true A added what out of to every those defer quarter. I reminder refer you what but -- is protocols questions, we've to is what we've --

patient we model. that We over by feel a continues addition to adding driven new more really built that good We've have in protocols, generate now with a to center-by-center. base, this the ability recurring have And is but with model protocols XX centers. to importantly

I side strong think the it's So our such that that our of developed Alex, is built, us it's most impressive because think for continuing competitive the I sustain built. to of is the ad which growth continues addition quarter, quarter-on-quarter well. every us strength This quite and we've as impressive. moat help we've moat and from And a protocols

able to drive the is come space, because what enabled also If been us, we've overall in it's do on good you think others but grow share that capturing been top help market of to competition, we it's think overall of for it's But that so not growth. market Natera, only share. the market

of just overall well. the increase sort seeing in growth overall been volume being pre-COVID point But an as time current seeing COVID an with we've in what that obviously numbers. think this offset given we're market I to

thing about it our key other competition accelerate to The allowed is really overall us strategy.

So do that really able what's digital else connect building no really to we actually on couldn't that. just of heard about is business, we're do But as one and before. to the don't is unique patient able journey. really No also now which one you have focused what space it this it, in been think in number we the side adding that but was core link on our we expand we've described been doing patients by

bring really to that's those think follow there investing moving described well. of key innovation. multimodal competitors. I try on the leader we one company previously, side. market are and which There three route some So sets see will the Also We as are as in

So that's real is where innovation. opportunity I think others drive to are seeing whether the

we are to mentioned of I bio this license in you where the are how to than to the And see opportunistic the do trying more wanting you take urine tests, there shortcuts in think you others think compete the marketplace. example. others technique That's not space out. there get

of in the terms competitors. segmentation of sort that's So different we've the given

Alex Nowak

extremely just then paid lastly per helpful. you the now. No, Okay. And being look just when test price at

does at paid of you how could commercial, those guidance And add not in clear that it is come be. And to that just of being You any there? the revenue much those tests sitting you're revenue want by up, certainly assuming I look but all in. make out aren't

Ankur Dhingra

Yes. That's right.

every to even So certainly a any now I'm to were guidance where could think don't we about in ASPs. my for have fully higher next reimbursed we test improvement fairly coverage of assuming if But for in year revenues. get I XX% in out not significant as XX% opportunity be there

Alex Nowak

Appreciate Understood. update. Thank Okay. the you.

Operator

question Matt Please comes from go ahead. with next Goldman Sachs. Sykes The

Unidentified Analyst

this is on Nick for Hey, Matt.

the in to the pick headwind from levels, Omicron year conservatives far headwind So normal mentioned you that to of on baking the Are first or so certain that? that to kind abate volumes -- those in volumes amount are of quarter. the maybe up you and you you're expecting seeing goes a as into

Reg Seeto

I mean, it lowest had the spoke that we so the this was let of Ankur available. example the test talk XXXX. to putting less X,XXX in lot of during hospitals was that It were XX during really talk do XX being of interesting Yes. of -- past And a about us for probably sort period January. be then ability I of out centers had than just beds staffing Delta about to the the And shortages, of I'll since what March in including really think and network a as with is for be lot are I'll to couldn't kidney remarked IPOs, held and had it the actually people guidance. the search done part swaths transplant out and community. with was of and what's infected centers support taken the in to system example. being for of But

country was time real needing is during the that and a also during X.X you I January. the during that staff of like the infections this really think So And acuteness were beds getting then remember time. like million patients in shortage the

was really there pressure. significant So a

we're The saw of and what for So transplant we the at continues in we February an sort as month is the thing hope improvement good what that in January. volumes was least seeing well. is real

hand I'll to over Ankur. So,

Ankur Dhingra

-- to Thanks outlining profile volumes will assumes And of outlined, and the Yes. the guidance continued course, midpoint market as at Reg Reg. a was transplant belief lower think, year. end, at the given that actions that I the end weakness. growth the the Reg of And the we its Matt, long-term strong high this overall return various during in our

right now. it how we're that's thinking So, about

Unidentified Analyst

this growth And the Okay. how know about on you you. the said on? AlloSure thinking just probably isn't see cadence? increased you are goes Got you too Thank to overall Lung, about growth year But the And excited I penetration year how it. guys contribution be big. can you guys then are going as

Reg Seeto

Sorry can AlloSure The you just Lung-- repeat that?

Unidentified Analyst

Yes.

the see are you are you looking how that similarly the that up to cadence on? center on? Just increase year growth penetration goes of the And as year sort goes seeing penetration -- pick how as

Reg Seeto

I year. And such XXX mean this place a unmet I we is shared also QX we've last think need months. in of that first the XX% three in that shared take really huge Yes. we've tees seen

we that steady-state look example continue as look I -- to analogue if think I hard an increase. penetration, XX%, as mean XX expect seed to it's at we over was at for XX at plus kidney we built a XX% it's half years. years. and over And see was side, three on what and if that you of at the think XX% built and you that in

we months everything. you really And if a have three so that benchmark we're XX%, getting pretty exceeding good think in

that the penetration think what I the I kidney which be is. get bar will that hopefully next we to So, we'll trajectory think continue

Unidentified Analyst

Thank you.

Operator

ahead. from comes Raymond Cooper with Please Andrew James. go question next The

Andrew Cooper

year-over-year everybody. Hey but more in for the dynamics you decline, the little Thanks I commentary expecting you're lung versus around in to you're just questions. terms spend Maybe the of flavor the that want -- can by too of high ASP breakout give kidney single-digit it, sort heart? the what on apples-to-apples a much time is driven first don't bit and for of assuming

Ankur Dhingra

-- as or Yes, is And to XXXX. core about business higher we've so in visibility lung, XXXX parse I is intend and in testing of provide comes so that be the expected able into for and franchise out, volumes smaller say it where relatively next to the for but the from continue a kidney would heart growth be and you'll commercial roughly I that seen to then given a we'll that would the to smaller kind few trend the Andrew mid-single-digits market quarters, be should that contributor.

Andrew Cooper

more in kidney lung of terms in as kind exactly of Has there think about sorry what Is -- anything they're And terms back some perfect. then then wanted. you to before the there and they're coverage? forth? been what can MolDx I for of asking And submission? looking greatest with for still Okay, add what or just can Medicare you latest you get AlloMap as sitting That's there Palmetto? also and

Ankur Dhingra

start additional of hands It's kidney of of and the with complete. of happening. the earlier. our lung, data let continued some York working for for in the through dossier in to well. it for providing with The test parallel is AlloMap time. case then of that lung published around and State case certainly there at Kidney, Yes, or on make had validation and waiting approval all well. the dossier then to as we're when Okay. said that the point we're is We'll approval transition published know information as looking is progress we're information the this that In work MolDx the our everyone as New And all all I'll we In We we including decision CLIA their good earlier comes ongoing for. and MolDx. that they're in that

been very been we've there team in progress on has timeline Kidney excited stayed has of the Given and good. that AlloMap their -- case the is quite

Andrew Cooper

Okay, for me. great. And one maybe just more

that parts here as I As of and can we give kind front? is but think there's a well, there's lawsuits called on other DOJ what legal forward some you going just related? some anything think flavor to Is you out, on? going know about moving this is if that that there spend the driver

Ankur Dhingra

Yes. going on up False so several False actually Claims here we and we has you factors coming IP-related the few a our know do the a that trial there, Claims especially shortly act. been have Yes, As on for Act right? litigations work have

we in contribution part that So, doing also of and the all the expeditiously That's as the was in spend, are of that. required providing work well. is the part with that but that information the government requests

Andrew Cooper

there. I’ll great. stop the time. for Okay, Thanks

Operator

question ahead. go next Please BTIG. comes from with Massaro The Mark

Unidentified Analyst

the Mark. is Thanks Hey, taking for Vivian guys. questions. This for on

might lower offset just procedures the you how So considering to you over in decline recovery transplant Thanks. volume? trending the that during any sequential Any volume the you quarter, transplant measures could take to speak year? see might next

Reg Seeto

transplant of back -- in last basically reinforce to further Vivian. talked time, years Thanks levels you we in No. saw X,XXX had you around under then go around you X,XXX, X,XXX in was if you XXXX, time if XXXX. a February I volumes January that in a how mean, month. dramatic back or of was back Yes. that, even volumes something low we history where about done. get -- couple had transplants the had to in And we was you just March And a in trend was XXXX again are mentioned was the The when go slow. this last

to really big the So was January a community. transplant hit

said is beginning that beginning Now is January recover. to to -- February

And in back previous when recovery that with wave the are happen, in this we the improvements the as donors. living done. see lot do was the volumes a will last around of hit rebound, we saw this transplant So time being

staff also but some side in So staffing would the be start have seeing I there happen return And biggest process but where recovery areas the as the across donors U.S., the think hospitals. that shortages of There the is are there. has that you the part a of you'll get points to kidding couple of increase, of living you'll of of step gating well. as natural delta increase think, other more I been now

bit it's we'll in seeing that So of start as but continue through than more quarter, we January. a twofold promising expect, you'll February the more it certainly have data had looked we sort But that.

Unidentified Analyst

And just one great. Okay, follow-up. quick

discuss maybe could what over for or or Given areas quarter, the potential that acquisitions acquisitions you you appetite looking partnerships? two your you're completed additional at

Reg Seeto

than is our acquisitions probably good part do like rate. we year. bit so two three Yes, did of a what run a what I in a Last mean, But it's core more or year we've every normally five, do. around we always thematic. we done

sort did XXXX And direct UroMap we to the Zen HistoMap was us, for the workflow built was do on in also number paper and the with did multimodality, electronically. patients, both both discharge which think, acquisition And connection, dialysis actually which then for partnerships for through with about why at we approach TxHero. and and that transplant about And so, on there order. connection transplant acquisitions innovation as is with bringing and how then pharmacy I with adherence the patient centers saw how with with the direct why we which transplant to well TxAccess patients progress drive improving to last then with how as look the one patient example, bringing we to and XXXX more the direct is center really medication of later is the and with year recently in further us really And LOID. on is you do MedActionPlan the do form also then then and we app

management. integrated it's all is XXXX really, of strategy. So, part for an Thematic direct-to-patient

offerings And that's couple so, ahead. I a years of area well. of thought it's But out that around more -- plan again, like think you'll part sort have see we of as really, a

that years executing plan just on a was developed we're a So few ago.

Unidentified Analyst

taking questions. for Thanks great. Okay, the

Ankur Dhingra

litigation a to false on meant advertising. say claims, competitors. the to question we next legal going about correction our have I the Andrew's go I there's said about like I spend. to make question Andrew, we one is mistakenly false in with to responding would Before This litigation of the

Operator

go from next Patel Dipesh Wainwright. question H.C. comes Please The Instructions] from ahead. [Operator

Dipesh Patel

going any standing in and do And change forward? Hi, everyone. Chen, Dipesh the months? Yi you the the but Patel for in is volumes question transplant My Thank anticipate extension for name update. to H.C. you transplant of Wainwright. heart stable recent kidney In just

Reg Seeto

Sorry repeat Can repeat the question question? you the can volumes. you transplant

Dipesh Patel

months? I do change – transplant And going the you are guess you in of anticipate kidney and any forward? stable Do they recent volumes heart

Reg Seeto

in since a when February were of hit. last was you last probably as January January a And March that done back the was answering which that COVID XXXX, in the spent as number the years of month the found we last worst XXXX. in XXXX. about you've the ago baseline, just We low numbers January saw five couple questions time And of around first was then time

So there volume. has been a impact transplant the cyclical nature in of terms on

three quarters also QX on seen continue from that we've from declines we've and last seen the QX. in QX QX and in sequential However, QX

here well rebound However, we've we will think past a the particularly as donor seen is in as cycles do side. the take point on that place as living

Dipesh Patel

is the do my continue XXXX?. Great. And expenses you last total to throughout expect then operating increase question to

Ankur Dhingra

Yes.

well keep we are sustainable commercial we front for us we mentioned, both – of at intent our look in as scale as capabilities as to as R&D investing in in we investing And anticipate growth. as opportunity this As the is growth. our for company market

Dipesh Patel

Thank so much. Perfect. you

Operator

Seeto turn the for conference any like over I would to the back remarks. closing question-and-answer to concludes session. Reg This

Reg Seeto

really all and an today's a much call. was XX. month very real us African-American month for on is not donate that's it's hot only think Thanks February incredible the as analysts I mission it's mean we the transplant February and of for month, life transplant and investors for also us Yes. tend space convenient.

well. different So our calls think just the space may on all that invest hopefully, continue as to know patient this to we transplant you of within to focus as listening be the you continue and

have you now. So Thank day. a great again

Operator

conference today's concludes call. This

participating Thank for day. You lines. pleasant a your you may have disconnect and

CareDx (CDNA) 25 Feb 222021 Q4 Earnings call transcript