CDNA - Earnings call transcript Q4 2024

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Operator

Good afternoon, everyone. Welcome to the CareDx Inc. Fourth Quarter and Fiscal Year 2024 Earnings Conference Call. [Operator Instructions] Also, today's call is being recorded.

Now at this time, I'll turn things over to Ms. Relations. Investor Corner, Caroline ma'am. ahead, go Please

Caroline Corner

available Thank and you, today. the for us will afternoon's and is Thank ending www.caredx.com. this website John host Hanna, Jain, Good today, CareDx Chief afternoon. President currently release Earlier The for Executive XX, you the released company's December at Officer; joining Chief XXXX. operator. on Abhishek financial year Officer, call. results Financial

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

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

John Hanna

XX,XXX donor with rest million the ended through for stages match mission operating look in generated and over in to of impacted year. in thrive. of the joining solutions disciplined transformational $XX.X you, for everyone a revenue today's quarter January, the our cash congratulating to highlighting supporting a growth fourth XXX the $XXX and CareDx. in year-over-year. post-transplant by and employees in the CareDx, XXXX, gains all the revenue build we of At of call. our EBITDA. results, revenue patients to XX% performance, at adjusted $XXX million the We quarter start the million we XX% guidance lives of balance recipient monitoring, establishing We million globally the adjusted debt. approximately early in was to preannounced of of achieved the fiscal Thank to and create patients our we and the welcome due XXXX care expenses year year XXXX transplant fourth cash early to XXXX upon positive a patients to fourth I to In million EBITDA drive with forward sometimes quarter, management million, million $XXX Caroline, full target $X.X In EBITDA CareDx reported and continue and fourth our our up continuing from $XX reiterate life. for exit adjusted financial quarterly to $XX.X on and that in from to what and we patient's and year enable in way want transplant for that in no deliver of XXXX quarter the revenue Positioned to operations life-changing

in $XX.X our testing quarter services kidney sequential approximately drivers committed throughout quarter the We I'm expect was hearing to XX% from profitable growth to XX volume are services the anticipate year-over-year. was to revenue our an you then XX% further add and plan We prior million The the turn marketing up solutions. accomplishments up of Services, team on quarter, sell completed between across for several year. for we growth. million members should fourth and gain services Testing and sales highlight We year. in and fourth long-term to quarter the of lung. growth. EBITDA $XX XXXX, testing the and In our promote consecutive And we fourth quarter, $XX all million. me heart, adjusted going to the sixth experienced commentary key delivered fourth providing growth which XX,XXX from tests Testing from XXXX, transplant again organs,

addition collections ASP. to We expand to our and of XX organization team our also members the billing completed drive greater

continue our drive commercial opportunity invest where outsized operations in to we to an growth by will penetrating the further We see market.

expanded XX lives coverage. post-transplant XX.X from million added commercial the to post-transplant by payer in coverage commercial at AlloSure. strides million make to for X Heart and lives fourth beginning we In AlloMap continue month new X month We quarter, covered

will ASP expanded AlloMap new drive for million million quarters. For Heart the to we for added and coverage future our XXXX, lives continue management added AlloSure. XX This disciplined XX and in coverage covered or lives cycle for commercial full year revenue

software our and the patient services, in $XX.X year-over-year transplant reported tools which patient representing includes monitoring quarter, we million pharmacy, solutions, XX% of revenue our approximately digital and remote fourth to on growth. Moving

large-scale the synergies more the quarter, have on experience to accounts more projects data see our organ than Leidos' and digital patient U.S. or Department XXX,XXX new Human the the other OPTN Transplant the leverages Organ bid to by continue aims reporting, X the system IT wait modernize greater on health individuals services This patient transplant deep better and partnership organ a offerings. allocation serve associated initiative. solutions the facets modernization Health collection, AI rate of or with for systems capture to was and science procurement testing transplant in and a fourth We and This and When patient development, list. In solutions, solutions programs. strong Network, transplant digital expertise use and CareDx services. our between collaboration they organ National multiyear data awarded XX% and CareDx's partner, in Services and with the that health testing in software initiative contract to opportunity team Leidos, of provides us digital our our

potential We are to this access transplants. proud initiative, has expand which of to be the to organ a part

assays test lab globally kit, multicenter representing recipient which study centers published on DNA growth. for monitoring the was Moving industry-leading In drove of and Tx which Transplant recipients prospective of of transplant IVD revenue X% cell-free the allograft December, cell-free DNA Journal from and in typing AlloSeq detects AlloSeq NGS-based consistent that U.S. outside the the our for a includes in DNA referral HLA AlloSure results outside CareDx with of to our IVD X $XX.X solid donor kits organ HLA U.S., in XX% typing stem we PCR for growth. donor-derived kits patients rejection transplant included this Europe of our year-over-year primarily revenue from rapid International. Sales products, cell typing lab-developed Today, million, demonstrated disease reported organ study NGS kits and of XXX U.S. approximately the transplant AlloSeq comes for The HLA cell-free recipients

and over that detection labs expanding what cell-free at achieve year enable X,XXX for Tx NGS performed we transition HLA rejection lab to for we are labs key adoption use and well globally drivers alone. HLA of drive I growth positioned CareDx, our to AlloSeq that our products continue in of highlight NGS believe kidney, profitable lung DNA there in view be will in HLA of truly a industry-leading detecting to are we growth was XXXX. now XXXX However, want transformational continued the to to heart continuum AlloSeq to XXXX care for our allograft out in to and typing our data typing plan X,XXX Union XX,XXX The is rejection services the strategy and European X-year annually our across long-range these testing laid assay. allograft centers presentation. forward XX go-to-market look in business. Number our growth. one We the that transplant same drive us we've transplants growth the across provide in to volume solutions to

Number and services synergistic two, digital growing pharmacy, to are lab payer evidence testing coverage. Our our adoption. generation to expand products

health our which outcomes cash. XXXX, business allow achieve Evidence care and these and business we including number services and provide We improve and process have areas. operating significant continue to we three, to generate operational coverage profitably, to demonstrate And value status the improve excellence achieving each and optimization, growth us health of allows anticipate growth provide the to generation, milestones ASP. coding patient in-network to payment testing Throughout revenue expense outpace in significant us system. scale

risk may of tool both enabling how digital the the required. IOTA XXXX more go-to-market rate centers no to use AlloSure more These the monitoring, of example engagements it the real and our released of focus crucial program implemented their centers. we acceptance to in so sales offering to that IOTA time downside our around the of is surveillance Kidney, may transplant of of quality solutions most of Each prior score independently, current transplant for in CMS anticipate cases, is are perform through understand Kidney organ importance their positioned our real IOTA in with be regular increase each and payments the July in reporting risk performance by well namely designed transplant center. expanding kidney patient adoption AlloSure is metrics these transplant synergistic at start score which metrics specifically be with This transplant upside is may performance anticipate to CareDx's XXXX believe upcoming and we continued of The program, in we is strategy, provides program surveillance program. is release of year are of solutions, centers kidney program our X services to our July the XynQAPI, to testing rejection. anticipated center First, synergistic nationally. time. data centers drive an support. IOTA assessed the AlloSure The and patients will transplant manual monitor a allow software, which which entry testing volumes is IOTA require complex growing Both of digital

The pharmacy. transplant engagement solutions medication why suppression driving CareDx example of therapy medications, allograft the match kidney are Another support Pharmacy management undergo the immune the dose A of surveillance therapy immune of particular, symptoms interactions. rejection program a a transplant greater launching XXXX reason than is which patients, launch that is in and Transplant testing medication ideal result of key the a suppression our are in of first organ patients their drug-to-drug our adherence is are CareDx less often effects. side with to program half medication higher through individuals management of of in patient digital that on lack anticipated our those to with

XX a several failure determining pairs Heart and HLA of addition, kidney Tx that assay testing. later simultaneous an we NGS patients ongoing the assay, for rejection. our which for the primarily for with AlloView, to X.X of new of In our test transplant is rapid the in for for renal next-generation patients, we antibody-mediated organ intend HistoMap kidney this services, software lab Kidney our and of for products with plan allograft and we such to year, rejection. launch commentary performed as and and subtype piping software digital expression in rejection in for Assign including launch kidney AlloSure age patients patient our AlloSure under diabetes to In molecular Score testing on prediction expand products, year, our pancreas AI intend the provide gene XX, insulin-dependent solutions, profiling model pediatric launch risk X, launch And of the HLA AlloSeq PCR

the publications in In is and for of nearly investigators interim the kidney, manuscript second to anticipate CareDx's submitted we evidentiary the and lung, the malignancies transplant manuscript submitted in that We and malignancies. where of Moving to abstract build Society And quarter Tandem second for second evidence AlloSure monitor study to publications trial for An will anticipate XXXX half of half our be interim generation. transplant as of we payer each minimal undergone follow-up commercial clinician patients study for to Transplant the in demonstrates coverage at that an quarter, second first taking be transplantation. in drive of XXXX. cell we hematologic of AlloHeme and catalyst I kidney start be Heart hematologic SHORE of library to data expect heart, XXXX, the outcomes in health the published AlloHeme the testing the year, recurrence behaviors indication. second meeting and and and X-year the disease X,XXX have Congress in additional for and XXXX occurs form X-year improves will continue data who patient AlloHeme ISHLT our to last Transplantation, with for allogeneic in ACROBAT with from patients lung major to readouts meaningful we several anticipated pipeline of demonstrate to AlloSure trial cell for the readout Switching submitted will of a We or residual data In and long-term this the San changes The that data stem was presented assay manuscript half in heart first Lung the data scale. XXXX. therapy throughout underwent half KOAR presented improving future for Francisco. future These in manuscripts future conferences. supporting the Medicare be publication that from of submitted are outpaces expected will in approaches. kidney. the August meetings growth data World additional in further registry scientific be be in KOAR April International in lung. of expect build These more XXXX. in the heart and relapse, infrastructure we coverage expense ACROBAT conference operational those foundation a place of the excellence, for to is published abstract the enterprise month. XXXX. this submission ahead processes in The lay registry, following anticipate will the cell kidney care the second groundwork to completion efficiently operate at transplantation the interim of AlloHeme our clinically as detects time trial XXXX standard we business revenue In operational such fourth These

ASPs our to to team our cycle the seeing We a that may margins management future key have initiative products rebuilt our revenue in and the And quarters. increase supply impact look on have business. of forward lab in chain is operations gross

processes and and financial as the guidance. share If XX XXXX to Fremantle Abhishek full Australia turn contract quarter now end from improve to additional steps our now transitioned reduce profile supply to you recall, I gross by with and and of results and on COGS, And the margin year fourth XXXX. manufacturing the EU call more first that, over in will details taking U.S. manufacturers the Abhishek? to in phase, we we chain to are a manufacturing AlloSeq Tx

Abhishek Jain

John. our guidance. focus In my otherwise financial will fourth on remarks and Thank full to XXXX results I before results. year my discuss noted, you, quarter XXXX Unless will remarks turning non-GAAP today,

For further press and GAAP to refer filings. recent presentation in non-GAAP information, earnings please to our reconciliations release, SEC

quarter delivered exceeding quarter year-over-year, million, was We was fourth Test our with was up XX% revenue XX,XXX XXX,XXX to sixth Testing in and Digital of financial XX% XXXX, gain in services $XXX.X services sequential $XX highlights. XXXX. million testing year-over-year XXXX million year-over-year. of million, XX% of Patient in the approximately guidance. X% of tests, start grew the approximately representing the revenue updated $XXX $XX.X loss year-over-year results XX% growth. million, adjusted products compared EBITDA volumes the me XX% up $XX.X revenue million, Let to up of reported consecutive and revenue up end We adjusted an reported Solutions up $XX.X full year-over-year. volume an in key XXXX EBITDA year test high year-over-year. We

marketable Finally, in in debt. XXXX of no equivalents and million from securities year and cash, ending million the $XXX cash we cash generated operations, $XX with

starting margin. Moving to the details, with gross

Our gross non-GAAP in by up XXXX. year margin gross as for gross testing XX.X% points to compared The services. expansion was margin full was margin basis XXX driven primarily XX.X%, non-GAAP the of

operations. XX.X% XXXX services Our services testing gross to XXXX. ASP in expansion margin non-GAAP in our growth, improvement testing driven efficiencies The margin was in as managing compared was XX% well as gross lab by in continued volume

as gross and was to for 'XX Our XX% XX% Patient XXXX. margin in Digital non-GAAP Solutions compared

Excluding our 'XX gross profile, non-GAAP XX%. and Solutions has Patient for transplant pharmacy, gross a margin margin Digital which was our lower

as gross non-GAAP was XXXX. for margin XX% products to in 'XX compared Our XX%

the the expenses litigation million, financial operating year-end our million spend. continued reversed accrued reversed week, from $XXX by the the were million a jury year expenses the net In million approximately by in XXXX, recorded positive of down driven our we a $XX.X were decision reductions $XX for case verdict. GAAP competitor in million discipline the XXXX. in XXXX, reduction GAAP Moving for down in our overturning managing $XX statements, The Non-GAAP prior operating in P&L. this XXXX income legal Court operating our resulting liability the District $XX brought principally approximately the expenses. patent demonstrating in Earlier

in $XX gross operating revenue. X% a loss gain driven a to by which a full as XXXX. EBITDA EBITDA growth The was EBITDA million of adjusted gain to as improvement was year in leverage, million contributed $XX percent the in improved for operational loss of of margin margins adjusted non-GAAP Our better to expenses compared Adjusted of XXXX. revenue XXXX EBITDA in XX% from and adjusted and

equivalents million driven was cash a in increase The $XXX activities. in debt, year million strong an increase our no approximately marketable the ended balance cash $XX year-over-year. We balance. operating by cash, cash position strong cash of flow from and of our securities to and Turning with

Given XXXX $XX program up our over position February the to confidence authorized the buyback strong cash of in Board million years. share and business, our in another X

$XX we of expired As approximately that worth in a an a million program at average period. December of price approved reminder, shares $XX.X buyback a repurchased X-year share previously in XXXX over

Turning to guidance.

revenue expect from 'XX in assumes to million XX% range $XXX million. be adjusted of to million of 'XX XXXX. our $XXX midpoint in We approximately revenue growth the our The guidance $XXX of our

revenue XXXX adjusted with in tests prior $XX Our periods. in million excludes associated the revenue performed

details guidance. more provide our 'XX now me Let on

our anticipate We we services, a do testing to test basis be year. mid-teens volumes. For in volumes to We $X,XXX the expect a on approximately blended our our year-over-year. ASP grow estimate test seasonality to see for testing some full

Additionally, midweek in having the from first snow so fires, we quarter New have L.A. far, impacts Year holiday. and storms seen

We in and does X% quarter, we quarter to expect to proportionately X% the X% in in in to XXXX. Medicare not changes throughout quarter, growth growing X% test QX any 'XX to modest ASP, a for expect X% assume Also, coverage. of X% to third X% X,XXX first the the the X% year. the quarter fourth growth On of second this

and in solutions million approaching year-over-year, to is total. the approximately Our $XXX revenue grow lab mid-teens digital and in products expected Patient

year-over-year. expect our expenses We non-GAAP to expecting XX% our $XXX million, increase the approximately be We're of for full approximately gross operating margin XX% an XXXX. to approximately be year

million benefits, between quarter a matching, such full of employee full of gain We cetera. generally is impact the recent will also hires. our year expect soft million. payroll have QX our of as quarter taxes, et adjusted XXX(k) and to XXXX reset to due QX $XX $XX EBITDA for 'XX be

We deliver adjusted QX, the to that, With will mid-single expect to remarks. in QX turn in EBITDA digit of call I high now closing XXXX. remaining in and single-digit QX digit single QX, John a over in low

John Hanna

and do to this deeply care Zuill, us heart. he year At proud of team. Thank the our nurse the given music on of him, and and Meryl transplanted our one journey a loves honored first donors we AlloMap Earlier grandfather, are patients, transplant. is the of Abhishek. He with work recipients father, were XXth support a creating we a join month, have you, their to transplant of to shared advocate celebrate curative to art, gift which heart the CareDx, to respected patients for alike. Meryl patient we newly

patients XX through past selfless inspire life, to It transplant himself dedicated volunteer the community like Meryl profoundly For the he the a years, has is his that impacting and living stories ask every meaningful to create rich employees to efforts. our questions. line operator day for like I mission important life-changing to to thrive. would to open their that continue solutions now the transplant the enable

Operator

of Instructions] Goldman first this [Operator Sachs. go We afternoon Matt Sykes to

Prashant Kota

Congrats on quarter. is Matt. Prashant for This the on

about existing new services to talked more accounts you your converting solutions less in previously X customer about X than accounts solutions testing talk with customer efforts you revenue. So acquiring multi-solution your accounts? generating or more versus Can

John Hanna

quality are new on where metrics and now and to cause about into talked in in taking launching then our centers interactions we're we digital reporting to we really patient in that assisting is particular, kidney the can that those enables, therapy as which our to skip remarks, product transplant rejection. them having our assess. medication they lead a performance which drug-to-drug their patients focused we're IOTA prepared to in So shared that have geared addition, monitor dashboarding how pesky suppression, on immune solutions, leading program working management And XynQAPI toward for really the program,

team as is digital that and have believe they're heart commercial at about drive our here be as lung. centers transplant synergistic together across selling on so adopted solutions, use talked October, of each the we've or of patient our put since into of AlloSure, total and we types solutions in a account. become kidney, in And focused portfolio Investor more they Day country, And it we will these the

XXXX. a continuing And drive so growth to is think for we really this going be to catalyst in

Prashant Kota

transplantation you initially about and kidney have? can for Heart tests pancreas some Kidney provide may will tests you AlloSure is, reimbursement. like ASPs and imagine the AlloSure to follow-up that impact these without Pediatric talk on I my launching have then And simultaneous

all, impact, margins will So this how large have a at gross of in if XXXX? dilutive on

John Hanna

on that Peds and pancreas with consistent a but simultaneous AlloSure transplant. AlloSure other So indications, transplantation, acuity those commercial and important conditions, are for X right? we'll simultaneous that a AlloSure paid Heart pancreas for relatively undergoes a those claims paid I kidney kidney and AlloSure Kidney we patient pediatric indications, claims Heart undergoing in very on Kidney a anticipate when high heart and patient particular, be smaller how we're for think

any So would that providing or impact 'XX. that margins we're on have an guidance not gross negatively positively for

Operator

go We Jefferies. at Tycho to now next Peterson

Noah

This $XXX is on of forward $XX you Noah and from in for Tycho. million the longer wanted from on organic is million the the how in Congrats path thinking what M&A. ask capital I options particularly I of but kind are hook and about allocation are kind quarter. also with authorization, there the what on you the have there? the about cash, reversal, litigation, to here? If also know you're no you buyback for have

John Hanna

with forward likely IP it we path anticipate any litigation, The will that be appealed.

do along However, audit this that significant believe that with that that that thing partners our at accrual reverse invalidated we time. our was and assessment having the such to is is those patents appropriate

In your I and we've buyback about quarters. terms change perspective it the doesn't which this, share think talked of on capital our allocation, for second several question around

we're where growth. continued we continue see reinvest and foremost, business the First opportunities to for in to going

we'll third, if described. any look shares as buybacks transplant opportunities transactions, the or do to buy for to invest appropriate. in then share back marketplace or in the then go don't And plus transplant that opportunities we'll strategic and field see we've in Second, we strategic to adjacent that business

Noah

could follow-up just ask on I new And here, my if hires. for then

in I think you you that noted XQ. that completed

that in And from impact out wondering so will the half to how about XXXX. I'm ramp play particularly second new first half hires, see or

John Hanna

fully hire X the this We in and see be to field. up space roughly get the months them to new effective in typically ramp ramped

and Abhishek But bit also commented have quarter here QX. on training, and call like a we've to in pavement, As weather to given and us stronger the remarks, events QX seen expect and time the has a that fires little really focus field our in that. hitting out strategy in from teams there prepared we planning, of disruption

Operator

We'll now go Mark next at Massaro to BTIG.

Mark Massaro

topic say then 'XX, is about And wanted we to can for of a you And any I I on full in the might think Congrats much quarter. that? for there Abhishek, QX? can number but just period XXXX, hit collections repeat have as good prior you you collections. period then Maybe, the year the how I think clarify contribution hit guidance? in prior heard

Abhishek Jain

first which question, had the is on And with about called what prior were revenue, about the $XX includes throughout $X.X XXXX, recognized QX tests we test of outside the in in I've million revenue that So your the that also million Those revenue. associated we were QX. that to done out XXXX.

contribution So that's and we XXXX in these one last not and the the are from third in part the the one-timer of question. upsides. baking second And piece, Mark, guidance, tests, stays that the of

Mark Massaro

are into month in testing broadly, And now surveillance for QX? marketplace ASPs much to of increased that and I you the the understand I'd surveillance What about volume of XXXX curious try more you of how then $X,XXX. mid-teens maybe is here volume what mid-teens testing? baking seeing we're are talk heard in that be for seeing think you then I guys And in February. to

John Hanna

surveillance that believe mid-teens to quarter. turning to growth. And we volume Yes, pace. kidney do through institutions and own protocols organs, their that move continue contribute that institutions have going substantially testing testing those on to In at the is we other outpaced surveillance QX, are all

that then going protocols to on the to the of of those And protocol. new take back So turn as XX for patients said protocol volume quarters to through I've initiation it's get months on. build it's started previously, X X course the to to time to probably us following take that going and

forward, to on. back having workflow really is and So turned we're on primary about our it. the focus engagements those working in get a and protocols of through those that feel team that journey. discussions going good And We

Mark Massaro

one provided then quick like looks a just last buffer one. you And million It $X the guidance. on

weather think or end a just million. $XXX some can million explain rationale it's guide what to for to the preannounced the just that. levers of the million, are of other due end the you lower and now upper you $XXX to of Maybe guide? Maybe I you think the rev $XXX But also variability. it's and

Abhishek Jain

nontesting the revenue. $XXX bridge the we growth our end high the And the that's million have the out, million. the midpoint volume, percentage the of the up of about adjusted plus/minus and of difference. what at there were in guide, mid-teens, makes small the a And X.X low point end million the I guide, the plus/minus and X% to services. So course, XX% $X portion ASP, on is basically That $X XXXX assuming the on called if from I'm basically

John Hanna

the the about on are on it's go surveillance new built with how in organization the focus which and think comes back effective operational and we excellence cash. out I collect a speed that kidney on at billing to upside, we've really with

rate less is you reimbursement at that of our suggested XXXX than As year know, our the Medicare half reimbursement we've rate. for

of the And there, so we're but organization. in it's there's we lot focused to on a opportunity difficult really ASP, think it's very but something forecast here

Operator

Bill Bonello now at Craig-Hallum. We'll next go to

William Bonello

of questions. couple A

talked made guide. First sense again and makes front, terms And sort all, just of year. the it's strides team. But assumes that about in following of of obviously ASP of pretty total a good reorganizing the up things what you you kinds on billing which last adding really flat,

important lay capture? to revenue have the just you some little the most of us a bit what opportunities you can or So opportunities improve out for

John Hanna

in the good really to for new been we're What a claims understanding are ours to about can claims the filing? work don't And would what get I leader money. letters cash. about miss that goes ones able into teams place in towards, have industrial team talent to and is so the tight the we a to in timely lot appeal deadline? claims processes drive improve and workflow lot really dials be business and overturned? steps are appealing are leadership the on work call that now. billing needed can on really that it's it's blocking a turning to And What and of we the detailed and the in okay, skill We individuals manner Do which what our we're and we've to order right that what up-level on right and and an impact. team to organizations, set now that We going which what doing the There's we the timely hiring. get have got we're put brought tackling and appropriate operations place we and that of feel the hit these we've billing. are think a cash collection timely that you we the going collect know engineering organization. we've the in systems filing Are aisles And in like so collect working knobs the So the processes process? revamp to in that across

William Bonello

those of sorts that, a systems And from capable of just system, is as part what a follow-up use are systems implementing tools? doing, to collection as and you're know you I on mean, themselves? don't the guys of be of standpoint, sort going what upgrading billing have the I systems Or you the but

John Hanna

the We customize and the capable system just it. upgraded then using were in of Yes. you license we The system. modules can and our is workflows

out what under-resourced, very were the of we basic of and could. a was the So they previously doing were was just team lot they and box what collecting

the spend. and And return so the we way said, "Hey, here outsizes came in

on the And course, there team, like to hard we've the the execute we that about table." let's said up and the ensure build feel And system, we you're what go talent have of it's upgrade putting and really repeatedly, right Let's before. to as workflows left we're collect can build of I've the let's be out appreciation in before. This because place done best-in-class. forecast stuff. in this has But mirror team kind good the done rearview looking this ASP what's

And so we there opportunity upside execute we have we think appropriately. if

William Bonello

endpoints results, you And is important remind just get KOAR, completely is for maybe speak that gears. switching On can to then what evaluating? just or just this you at the I study why know to but trying were the looking study. can't I'm us us of guess I objectives the you obviously, such and remind an

John Hanna

payers. we these multicenter control typically, products, we've groups, And when build, products, enrolled, several groups, The evidence the no these patients important And prospective, there retrospective? as things evaluated all weight you number you the center Bill, got see a of by the now are relatively launch know, of large. control becomes size you with is of studies, more group? an the the single control because, evidence It's All of no retrospective. studies, by important. study it retrospective study, these Is and

guide study care solidify symptoms Kidney creatinine, control like patient of which observation biopsy, much rejection multicenter these of that way and of product other the patients, evaluating of proteinuria, is a KOAR than best signs really ultrasound, AlloSure of higher And when without. you're is detect use X,XXX with tools a efficacy nearly with the it to a clinical or of the serum of physician yield so standard group has rejection ahead patients the management be managing to AlloSure and prospective the

William Bonello

ask if one And follow-up. can just I

Just doesn't least as one the that maybe biopsy, issues tests. set be isn't a comparison the think know I of to we other although is a the Or we initially, instead is introduced not think being clinical these not I this in biopsy. about at the perception comparison that The whole of study, sense. of done mean is that point But laboratory reimbursement tests and kidney, accurate? this Is situation were point make ton case? that up.

John Hanna

AlloSure in to manage of Kidney clinically the rejection use is intended think order I to patients. identify

by yield is guided a biopsies. a goal of than The in avoid of is the such so higher AlloSure. when is the goal performed, to biopsy study the a patient manage And rejection much is patients to that's not who that undergoes not biopsy effectively

Operator

to James. at We'll Andrew go next now Raymond Cooper

Andrew Cooper

just I legal a spend P&L, EBITDA. out bit you on Maybe starting called the the think kind first Abhishek, little helping of really down

You don't out. back that

run at couldn't isn't new year, the we here of that the guidance and that the something if comp XQ that as $XX-plus laying for in right get of you some kind out why we increases framework higher hires you're Looking than starting at now? point, right the adjust start of even Why see million rate a the starting point?

Abhishek Jain

one, did $XX million way that are EBITDA, XXXX. the the at adjusted we on look pieces in I adjusted start Number to this. EBITDA There X to in

we called $XX out So prior the the period I to out backed the to in XXXX. revenue million pertaining that revenue basically

you that's adjusted you of arrive XXXX, So for about adjust at million. $XX that, and our $XX guidance the EBITDA million in midpoint adjusted EBITDA for

So on of to XX% basis, comparable we the are the drop scale the like adjusted XXXX. that drive XX%, increase believe to $XX margin question bottom operations, our on the legal the specifically your down drop given investments in fact And revenue I incremental line. making a that's spend a of our $XX in million And a EBITDA pretty about million that that's kind the that, goal million in profitability, part, to good XXXX. legal is already $XXX to number of on achieve

So to because XXXX expense that's the lower that or not anything impact XXXX makes be that your missing you've maybe of sense going seen itself, I'm already impacting in otherwise. if

Andrew Cooper

trends. asked already surveillance And on somebody then I know

about of like and the at updates of the talk people some higher kind AlloSure right to want now. level reasons things all and the nitty-gritty about exactly when think be you a some you pointing of we things IOTA are are procurement think and we So I that AlloMap should the organs used. these of and of get to that, don't into in utilization and/or where But towards

about programs drive much long about that guide, think can drive how focus to where like it the you really penetration can you of when from a term, So that, think that the when lift in is like John, guess faster? patients a that X-year bit I basis new that And why on is, substantially sort something little higher. of said, happen a IOTA you today can't to knowing

John Hanna

for to are would think or that are has more risk down you. going the is rejection patients, that use I've testing these yes, don't that had they turn those of disagree those utilized. our And to I organs that administration at had especially We're I monitor about when this they that them administration understand team to when the being increased you're be with asking organs and pushing, previously to are centers conversations patients with allocated important are any with Andrew. that,

particularly outcomes need everything role huge a matching ensure tools of program. country there's having to they our conversations context think we And manage are that that for those we're patients and high-quality program software our from to our effectively in the they transplantation. new services, HLA maintain post health the tools, that going be active have digital to around patient so of transplant the all centers part a And the across with IOTA

Andrew Cooper

want out $X,XXX a ROI with ASP, asked a just the heads. And then bit $X.X think XQ, deeper million example, I ask one an I incremental in I from And know maybe mind, of, back of we of little to that about Bill the the in kind if of you're one. back for my perspective. you little the north on just at last a little how dig about but on ASP

You with hopefully. heads, incremental momentum some should get those

the in couple that, about something a So perspective being of of dollars you guidance? an that like this from is other caution mix here to that or a as offset we just ROI, of abundance should of when where is sort think success? about think Or some there lift

Abhishek Jain

million the year. were the QX if the back $X.X on Andrew, then out $X,XXX-ish, be are $X,XXX from would and you to full ASP looking there you're roughly we that the spot for revenues, at

we're as And stays opportunity for in grow. we RCM in single improvements the So system as this leader to our have we building on in team, are basically that side for as out told initially what that an we that to ASPs anticipating we the as new us bring low be well as look growing John course, baking called our the are we of digit.

So numbers for we'll pans these out, are but see to now. this as the how

Operator

go now We at next to Carrico Stephens. Mason

Mason Carrico

today? you Could place on in number out the calling year-to-date? Any you protocols of worth update have us wins

John Hanna

protocol number, a Mason. provide didn't We

that's was in restrictive reduction that number the did insight period previously in we QX, some post the And to think starting something the to in gave we I the that of provide discontinued. that saw initial organization investors earnest. just in language the LCD move with and that then this

Mason Carrico

organs protocols into I out surveillance insight what have quarters quarter. volumes, bit pulling in other at for of you us also you little give outpacing least taking kidney start Well, but seeing a talked a you're the through guys it few so called to know these could about maybe if you far.

base? could starting from is a seeing you're them utilize that market, versus seeing centers today them much surveillance protocol volume coming broader with versus give us adopt were of Are testing in you your protocols centers, in So just patient broader just the early that an patient those frequency increase you to the centers particularly way? of sense that how to at a your

John Hanna

to break that down. happy I'm

and a with an volume on those volume ramp-up of from on described, basis transplants it's transplanted that what being transitioning of I've center I they're protocol, patients transplant yes, going a monthly those incident consistent ARTS that the think, initiate initiate that on And a with very protocol at then a centers, consistent patients. patients performing in patients XXX. are to previously thus, protocol when seeing prevalent does movement, they're is which to and seeing we newly we're

a well that to center mean understood clinician cell-free a a here does are does addition I not and the that, sometimes think lack donor-derived because I In protocol DNA missed use testing we purposes. surveillance or it's for not -- not of that your and question appreciate

of clinicians that case on So that patient biopsy, graft. where using patient volume, that impact the of comes it our and the protocols, surveillance it because that to but protocols some outcomes and and it found testing individual save from they've from that have that we're believe able AlloSure, and don't a they've rejection had in rejection has detected subclinical some of centers test treated with effectively comes that centers performed

So make are continue country to today, that we have clinicians with patients those that their to transplants work like believers there high-quality kidney all sure outcomes. patients with the that and managing over are

Operator

We H.C. go Eduardo Martinez next to at now Wainwright.

Eduardo Martinez

talked whatever for quick more A these I Do drug-drug it improve on what Is with may on it suffering it get about about adherence reminders you're or to already about to be? drugs. be and have pharmacy Eduardo the is some to you've some these implementing? Yi from color trying question. text their interactions there. details any immunosuppressants guess for This planning to on strategy of Chen. the patients these management going more you strategies like the Just hoping

John Hanna

Yes, tools text-based medication reminders. where do digital we we have

transplant is clinician the have other used to medication a document to and they of to discharge consumer patient the clinician that the point app a a download like with the many along is can at app, using take, that where drug-to-drug prior walk they're that's interaction their the the is so We immunosuppression a it summarizes centers and specific patient medication. the the utilizes all that through regimen that information followed discharge, program has with by PDF what that phone then that able effectively patient, on medications reminders

So that's our digital solution.

really undergone operate to business we're that the transplant at In that specialty addition way. and the have specific in system and pharmacists consultative a delivers hospital those specialty discussion specialists, a the deal perhaps health patients specialty or pharmacy, patients with where to with a to launching that, where pharmacists we we have pharmacy therapeutics and they're pharmacists interact in a that in, the transplant trained the as transplant that that MTM setting program more aren't they're have a high-touch patients a center, not their directly

way. high-touch or patient in or the that it compromised clinician patients a health managed be higher-risk organ And maybe so that she complicates that can good issue. has can medication particularly concomitant was drug-to-drug to match a -- that refer to a condition interaction see don't patients in perhaps have CareDx their And the more or that he refer transplant today, pharmacy a we

Eduardo Martinez

that you stem and the what guys the And of curious time for X-year then what line study towards study. have launch is -- cell you vision the hematopoietic kind I'm product? readout and on pivoting more for interim mentioned transplantation that

John Hanna

was So interim it's there data. a Tandem in February, a at And X-year readout X-year of cell therapy study. follow-up the meeting,

there's another fully that is year so study, follow-up enrolled. in nearly but required it of And

product upcoming talking as its that get write-up of the anticipate of closer we conclusion coverage. trial, submission data in to launch calls Medicare that the we so the and And for about of that

Eduardo Martinez

are thinking interest opportunities. M&A thoughts one area? now you in you And curiosity guys partnerships, have and xenotransplantation strategic or you allocation, is in capital mentioned that partnerships any Do about any final on as about

John Hanna

CareDx has a number of partnerships xenotransplantation. in

have date. of that the the We monitoring been has specifically nearly occurred to xenotransplants utilized of have grafts in a product xeno that all for

So the centers we procedures. developing of organs modified that with those are have partnerships companies transplant those each performing and the

Operator

We Nephron at go next Thomas now Research. to DeBourcy,

Thomas DeBourcy

your was for And adds I kidney year curious what this evidence data that question My terms KOAR. to base. in to relates of data your in incremental existing

real-world has it outcomes in it. think I

greater And protocol wins additional as is potential compliance drive there drive and/or so well? payer a to

John Hanna

them. There to and nonbelievers clinicians answer for I think published more that be waiting these are testing is cell-free are products yes both. many data in the adopt to are donor-derived before they DNA on

So a there's any technology, like long adoption medical an that's cycle. curve with

as And clinician earlier. large to continuing adoption both publish of and multicenter well-designed coverage, prospective important course, payer for I so is trials highlighted for

we So the anticipate, initial KOAR be as in second half to I described, XXXX. the manuscript of published

I XXXX. payer think impact really that would policies So in

Operator

at no And time. gentlemen, it questions further this appears we have

all thank So wish that you to like so conclusion great everyone. bring XXXX much Fiscal you for Conference We Quarter remainder thanks us. joining a Again, Earnings Again, Year the of CareDx's of Fourth to Goodbye, us your for we'd joining and will Call. day. today's call.

CareDx (CDNA) 26 Feb 252024 Q4 Earnings call transcript