Earnings call transcript Q1 2023

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Operator

Good day, and thank you for standing by and welcome to the Biodesix First Quarter 2023 Earnings Conference Call. At this time all participants are in a listen-only mode. After the speakers presentation there will be a question-and-answer session. [Operator Instructions]

Please be advised that today’s conference is being recorded.

to Brinzey conference of like speaker to now Chris today Biodesix would hand over the your I Investor Relations. ahead. go Please

Chris Brinzey

Thank highlights will by Chief be and Scott everyone. be afternoon results. Leading today joined of and Chief today for Officer. financial first Financial operator, will call Biodesix's business us discussion for Cowie, Executive Thank XXXX Robin quarter Hutton, Harper the joining a you, you good Officer. He

Q&A. we also will release recording open as After An the for today’s will audio this webcast call call detailed prepared be for replay call. remarks, announcement for press and the online in conference the available

the a for results found as changing on release and press issued of a our announcing the financial Investor Biodesix we Relations of reduced the business of company or competitive XXXX. demand, results quarter those events page website. Actual highlights from projected nature result of and trends, industry. the can Today, first the may be release copy materially differ market A

Commission as year section XX-Q statements and their first factors quarter X, The unknown those other statements projected. elsewhere March form and the XXXX actual for Factors from this forward-looking may on in applicable. are December the ending subject report as and materially on for risks in known call other and involve discussed uncertainties, well and cause differ uncertainties, or XX-K that risks, XX, Exchange Risk with results forward-looking and those to discussed performance implications to on today Such including the the company’s XXXX XXXX Form annual filed on filed as Securities

and are detail results factors forward-looking in that the materially with in SEC. filings today press could in greater information described differ the release our to issued company’s concerning company’s Additional cause from the statements

the Scott. to Chief call would to Scott I over Hutton, like turn now Executive Officer.

Scott Hutton

personalized unite to clinical portfolio diagnostics and lung the Biodesix of lung mission with across to care. of continuum transform the build diagnostics. biopharma of Biodesix a standard support company patient-centric, a test a physicians, we Chris. is outcomes patients, to decision-making mission-driven At you, care with disease diagnostic and Thank cancer precision improve comprehensive

from a of with by lung Nodify of lung cancer risk of diagnostic malignancy diagnosis, strategy. testing lung strategy, lung initial physicians nodule. guidance with lung which the proteomic nodules to CDT assessment testing Nodify to and the the consists portfolio risk testing Our ranges Nodify test. are treatment lung Nodify and monitoring of the used two blood-based IQ core XLX, assess post

tests, as mutations, consist test, test, the within treatment lung and of three three tests proteomic IQ blood based GeneStrat options are test. VeriStrat resistance rise the while for monitor genomic the of to testing lung therapy Offered patients strategy, decisions these IQ genomic the are on used the NGS inform and GeneStrat-ddPCR-targeted

And with All market five continued only Medicare covered cancer, by start the year. pleased the lung and to make portfolio all we for on tests five tests progress. Throughout the with in our core to we're I'm company are with lung diagnostic Medicare we've diagnostic excellent quarter, believe coverage. testing the

year at quarter the which XXXX, our million Looking we of revenue growth of reported XX% period financial compared $X.X for the represents same performance, total a first to ago.

years, lung growth in lung our nearly test Core quarterly accelerating of X.X The pleased that driven but quarterly business testing to highest XXXX, increased by the XX%, million We're testing growth diagnostic not core quarter generated ramp approximately testing diagnostics by volumes, primarily volumes only highlighted first in growth Nodify lung was quarter which again growth. in diagnostic compared two year-over-year impressive the core the lung growth. exceptionally our the with XX% of of by the reflecting volumes. of revenue year-over-year

beginning the day-to-day care an the in from teams as number of basis, sales on a increasing being physicians well Following of quarter, peer-to-peer the and has of our first in seen benefited educational events. as front team seasonality physician

Importantly, continued. we're start second the the with has first And seen of to the the quarter pleased the through momentum quarter. end

the first sales and our making to the this volumes year. private growth on driven coverage growth addition CDT of our part an team, the expect and In important test quarters, for Nodify remains reimbursement coming four strategy. private broadening our for payer by expected the policies in Nodify Building coverage XLX recent updates announcements progress you excellent including months additional for the to of and have later we're first coverage the anticipated

adoption support of studies our utility our support we IQ will and anticipate are build lung, strategies. that conducting clinical we several and also reimbursement, the testing clinical Nodify and clinical further To lung updates on upon

proteomic Specifically, Insight we testing, anticipate proprietary test. the assessing data additional study updates updated Nodify from the our study, and from immune clinical of data profiling based sharing evaluating Oracle and effectiveness our of performance blood VeriStrat the

in existing new and of enrollment trials. to but we backlog quarter, yet strong business, reported first biopharmaceutical the under by our and the positive the resulting to million for to service revenue and timelines continues clinical a a and ended we for not On impacted Moving partnerships from be with contract, agreements $XXX,XXX which quarter, quarter have delayed continue recognized. note, $X.X we

the believe delayed different healthcare Flow, pharma in challenges said providing partners and ability mechanisms, driving are our we're insights Longer key by AI remain subgroups biological experiencing timelines. identify and biopharmaceutical a the and cases quarters, to teams we the I've specific term, patients to in provide before continued in few it we for ongoing beyond and and efforts outcomes approach enough. encouraged may for that and require our originally backlog, will strength professionals some expected reiterate as by assume believe we next and our explainability While the advancements academic research different treatment. cannot are unique what are or clarity the Project transparent it

professionals range and matters when results We a United people care develop than patients. of deadliest position, combined; for class these with With the ability our more teams XXXX drive quickly and strong tests help with broad financial in colon in kills back breast, all three Time patient and continued health States test turnaround next volume our pride ability ourselves to growth strengthened the confident Lung and best that discover to products outcomes. beyond. and revenue and critical can cancer. times annually in and to the improve provide insights treating on Biodesix's cancer along prostate we're care in commercialize cancers in place, team to test

to the Robin? it review Now, over first financial performance. turn let Robin to me quarter XXXX

Robin Harper Cowie

Thanks Scott.

The million XX% increase the XXXX the for in compared increase prior X.X testing, prior the was XX% quarter approximately million XXXX X.X over first First by which increase. lung quarter we diagnostic recorded first of a CDT an Nodify year. over to first XXXX approximately Core test XLX XX% XXXX for the and in revenue quarter is volume quarter the total quarter lung driven was versus volumes includes the year. primarily test Nodify tests. total X.X growth revenue of of nodule In Nodify was our million

in of quarter in XX%. quarter was for between of Nodify The growth coverage XXX,XXX first the XXX,XXX primarily and quarter second achieved compared revenue Medicare by was revenue the in XXXX. CDT volume to a difference Biopharmaceutical decrease the services rates driven in XXXX

in including timing contract this instance, to continued several project prospective and due but in reflects reminder, factors, enrollment to delays can business a this recognize revenue. execution, clinical complete As project fluctuate trials the the of and

revenue. be diagnostic revenue In recognized million and public As modeled with emergency as company these expiration connection but negligible with will have we projects XXXX we was These XXXX. testing dollars agreements of the in health multiple as should as timelines to to recognized $X.X contribute today, ended Scott not in are not contracted with mentioned, declaration COVID first and will revenue XX no yet of executed. testing are tied services quarter quarter the the provide be longer commercially. May the the guided COVID-XX to different

Nodify versus of diagnostic higher the growth Gross gross long for prior margin first business in margin year quarter a year trends to quarter quarter. XXXX our the XXXX of in Medicare in testing in coverage receiving was the testing core our XX% the XX% percentage decrease COVID and expected as margin reflect of revenue margin for test. prior margin year reflects Current compared percentage ago. from revenue also CDT a lower Gross the quarter the the first

Looking to the of XXXX. remainder

benefit We of Medicare margin recently of benefit expect the gross commercial result as and for decisions through the year Nodify Nodify percentage coverage the overall to the to as a the coverage from resulting continue of announced XLX the our several including well tests, volumes CDT for payer efficiencies tests. coverage increase additional factors, as for all commercial and move operational we growth as of

expense driven for costs The quarter was from the direct compared the of the XXXX marketing of and travel level in other increases increased same team due expense to the excluding XXXX. primarily sales from period and the XX.X to expense related to to non-employee and members Overall operating return is in access in quarter for sales physicians million million XX.X operating first costs related increased pre-pandemic costs. expenses increase hiring

for expense team X.X expense of the the non-cash was the loss Net costs the perceptive the Operating stock million, quarter from XX.X compensation, period stock associated loss increase of first to the an quarter expense of our X.X the in to million X.X XXXX and net for increase a first with for included efforts. in loan as XXXX. XXXX includes quarter based quarter primarily million increase during the of commercial compensation in same million XX.X The interest in facility increase first the compared and for XXXX. net of non-cash in expansion million of term loss compared

cash with for includes and end unrestricted million integrated at scheduled in was the million considering equivalents payment XX.X the which equivalents approximately XX.X January of for million, of cash compared million our After in of ended cash an XX.X paid XXXX XX.X payments these million. royalty of and annual We in cash to other XXXX, all to burn diagnostics, a unrestricted activities decrease the non-financing million. items operating as quarter among milestone quarter X.X X.X the cash

will We we year. areas remain on cost move term growth through in as that focused XXXX the that near drive measures revenue growth driving impact positively primarily savings revenue not additional do and

Turning now to XXXX our guidance.

to million revenue XX provided XX We total the million. last of are quarter guidance of maintaining

our business. a modest as Our in as biopharmaceutical guidance year-over-year services brought expected growth market on assumes reimbursement strong core testing our growth five long of in diagnostic our continued well tests, business

revenue. Our revenue guidance as of XX% XXXX. approximately long year does growth for annual project represents and COVID-XX biopharmaceutical services not compared this revenue quarter guidance any The prior to midpoint

back Scott. Now to let Scott? me it turn

Scott Hutton

commitment collective thank lung dedication vision to double belief our their by focus and digit Biodesix's Thanks, for patients doing, and Robin. strong teammates, In which team. positively contributions growth Biodesix and so In closing, have daily mission, trajectory in I lives. impact sales exceptionally the established would all driven revolves our culture, like to we to around an

reimbursement our with from expanding private payers on Medicare XXXX our We market are will of decisions multiple test contribute to and that growth. we anticipate coverage

to support body expand we all successfully five our the utility clinical Supporting continue effort, lung growing of tests. data the clinical diagnostic this core to of of

strong have We which improve established margins, gross continue to

core diagnostic our on And of term approach. we cost and scaling lung near the a are with focusing revenue reimbursement. disciplined testing drivers with

I'll for to the that, the With turn questions. over call operator

Operator

much line from William [Operator comes the Andrew so first Brackmann Instructions] Blair. presenters. you question Your of Thank of

is line now Your open.

Unidentified Analyst

on This Andrew, Hi, Dustin the for thanks line is questions. taking for everyone. our

thus about asked just extra this ASPs. volumes recently in what in core some and the pacing all, of the terms year? patients for And of second trends the are loan rest you're seeing of quarter maybe First far on

Scott Hutton

joining. with consistent good Great Hey, question. to QX Yes. Thanks QX. is hear for from Dustin, you.

priority All back to of access treat on accounts, professionals desire our so sales physicians basis, they were to and do less a patients pre-pandemic. are those that have to treating able

out back of patients a risk lung So cancer. identifying those high with they're

physicians. had pandemic, And throughout of open so about that. to as ensuring one that know, challenges good feel access the continued really we you That we was the was

we're physicians offices what that schedules Secondarily, full. is and finding are

told What immunocompromised and were or pandemic. back we're that the to those risk, in following had clinic, those patients during are hearing and physicians. is might patients at that have comorbidity stay So seeing up home a with

look we green a us, for as so light. it And at

supporting talented force is sales physicians. Our out those

said, momentum They the now That positively trajectory and all margins especially and think maintain stopping Robin successes build we've gross and are upon had. to impact we can collaborating, growth that testing. will those we're continue COVID really we that as

lung double diagnostic levels continuing digit So we on core XX% growth the those year strong hope we're end back our portfolio. really by that to gross of pre-pandemic have low to margins, on and

Robin Harper Cowie

From an ASP by very perspective, consistent. our average product has been price sale

for As you know, Medicare population. the of accounts XX% about

and the drives Medicare least modest would that the coverage biggest anticipate see franchise, driver each I we we that for space, in private upticks. year the more But the is of of start payer of payments. lung really disease Medicare. the as over Nodify with the for the could to more the majority ASP So course gain is, at coverage some really

Unidentified Analyst

maybe Got effectiveness are force. recently and next there? your sales How it. related you gives year? just Thanks guys core a expanded growing of reps this for good And that. sales level franchise measuring now then on level And think the year current long of your you you a do question

Scott Hutton

Yes.

order we help really diagnostic population. we're a great feel a informing, like patient and to question. to testing empowering educating it's So Again, as physicians mover out this this in first space,

that some coming scale for that they're be of gonna are later, territories data. that more where and definitely there's additional on waiting faster, a some laggard, and So clinical they're

right can max tap out positioned, feel that or sales sales have that territory. is that the we So we we to out professional sales and really deal continue yet to now with team a grow see scale force have, appropriately we the

still sales those to And productivity numbers rep on there's improve think and metrics. so we room

we've on sales an performers here provide associate and our that onboarding them prospect, accounts. junior a with to opportunity made new we've bringing One rep to exceptionally associate of really is follow larger fast, consultant. the are goal allowing of continue go on enable sales the The that or more recent territories out XXXX, changes those up in support enable is kind top the and with and to accounts, begun to bringing growing

measures cost will it'll sales force. that the savings allow We to us think bench. this allow a But to some us on focus build for also

this been continue So already territories. of on will force, us expand as to that trained the the and grow already we can talent sales boarded, other pool we give with into that's move

that and get we in of start months. territories savings kind is cutting additional mass to minimize fees an and recruiting will to cost growth future expenses critical focus on As are and that able again, with

size So the we the feel force. about sales of good

Now.

know large Any we would resources And than less. sales always But would that more rather really begun is journey. opportunity. they have professional we've market this this say just a

keep intentionally expand ensure costs So to it to want mindfully we'll continue that check. we but in and to do we

Unidentified Analyst

we being can And five an Make sense. Thanks, contract just us is ramp? the What have VA you are together contract? Scott. Thank then like and update more, one Are all wondering utilization give if within the those CDT on ordered VA across you. those tests? And XLX?

Scott Hutton

what diagnostic added conducted and had the Last trial to That the for we've are to Nodify, led the XLX schedule CDT, fee VA an the that an And and in the of year, together. added of that year, the schedule. fee results a Nodify and core evaluation additional five was trial for announced Great XX Yes. utilizing all trial. question site half an of Nodify second being we others. our been And to reminder lung tests. of VA reminder,

indicative So could on them view we thought this of that was performance, tests help how risk at with really those population. patient their two

added So fee VA. schedule the on to go the the gave being ability us out expanding really across and to focus

everybody remind We've an we focus months, one done the to few and last introduction. continue of on would But it. thing is really that that over the it

rep bit again, it each that a to makes the educating every test. new order and a takes that empowering VA. sales into of So informing, and they're time. time They're little physician call And

of and out part trends. ordering question, test, of broken that Dustin, second the any On volumes haven't we the

notified for on and and over use XL lead other to CDT that it's an and opportunity think as tests it's going will schedule easiest that state fee those that to way acceptance to that the safest time. be to I three introduce the

Unidentified Analyst

Got all it. That's you. from Thank us.

Operator

you so much. Thank

Scott Hutton

Thanks Dustin.

Scott Hutton

I sorry. was Dustin, thinking question. just first I'm

Operator

Vukasin of Canaccord Thank you question next of Alex so much. And from line Genuity. the your comes

open. now is line Your

Alex Vukasin

is Kyle just services discuss if potential you was Thanks. Can our a revenue quarter the over headwinds of this if face could you the comment revenue might on than of curious Hi, the pharma might usual. Mikson. kind Vukasin line Alex year? lower you cadence for think bit be, some I what little biopharma for the just on is you

Scott Hutton

closed. Alex. the the we've watching trials return What hear were to That's so to pandemic, you, share the and that on whether Biopharma to three cadence proud been that Great last that clinical impacted. fronts. has pause seen years question. it excited contract significantly why from And dollars of Good been enrollment, of XXXX. events a of like Yes. we kind pandemic. for that's during or to in due over monitoring trial really it was numerous of rebound, pre lot is stalled really or clinical saw We've normal under we're and trials the

number come We've record proposals in had a of requests for thus far.

and leading with samples, that a contracts those think getting those retrospective that existing to we Unfortunately, dealing that that's samples. a you're of it's biopharma So are the interest on lot high and rebounding. indicator when is reliant remains business access really pulling

we to we And partners. believe finished for were biopharma how think all those But in contracts a little continue top XXXX. we priorities disappointed of in are our that so are still proceed. We they'll place

come but XXXX to be the QX, quite And to strong. some be this fully lumpy begun expect time, seen of in. Obviously, liked for I going business second would improvement forward, there's the we quarter to exceptionally going mark, for we've we question upon us been more of is think improve, we has to QX. an half have to be again, probably going XXXX. think that's But think that opportunity how those And have an we samples still

building over most of business, should and business. year. low book think expect fully the grow, little throughout we in that the at digits time, on And call. we're which it is X the But focused in expect next scale book contract, to we build nine, we earnings be So importantly, that million double a continue we'll to continue point under this and to of by

Alex Vukasin

great and next Got for all that their that the in it. of One upcoming of much curious very I for one look you Thanks. highlight me. kind we other can if color. Thank studies Insight you just readouts to any quarters. could last was forward few any for

Scott Hutton

great I Alex. question, know Yes.

really that better excited company, number We get the in really there, As had and healthcare of we're reinforcing be. demonstrate press release we we're Nodify gonna to of off can goes approach the and most, a really on be the the wait a the data the just And present. recently those driven diagnostic to that testing need have patients intervening hospital sharing publish it it more at out level, impact those can abstracts, obviously, a clinic econ And of the those data it soon. patients and a here and we'll nodule. value strategy, truly and prescribing highlight and benign have for watch a importance

our test, as was the embargoes are to will then we our recall, more that on may and We're which, we approaching that share is more profiling mark, you on really on target. insight, a a data [indiscernible] have excited patient share as we are our lifted. XXXX conference in rapidly season, days proprietary the coming immune And abstracts, meeting that, hear study into we'll as posters, head presentations and So share that. number will of

an on give by update next that. call, earnings our So we'll

that when reminder, kind outlook expect Nodify. have so Insight also we'll some sites, what trial Oracle fully looking publish for begin of shutting at the we of will and that be or to will wrapping as up you a analysis present at. begun the study then time, begun I give And do data will Alex will begin kind we those we've on of as down And a perspective when when we'll close

we've that paper And submitted published. to be

able the publishing. at that share by coming So by did Nodify as we that an that those to we'll were decrease strategy, And utilizing unnecessary a testing we physicians were interventions nearly we're days able have reminder, news to in the weeks last But time, paper hopeful here and show point on XX%. interim year. analysis in to

tests those performing than have we the and performance tests an or quarter So now world interim really again, at taking environment in or don't a are that validation main importantly, most are real are here data, at greater any the continues had next those to that good an in equal the to the rate. altitude two. analysis two strong but lookouts enroll Those demonstrating rate,

Alex Vukasin

That's much. Great. Thank so really you helpful.

Scott Hutton

thank Alex. you, Yes,

Operator

much. so you Thank

Your of the next question line comes [indiscernible] Morgan Stanley. of from

Your line open. is

Unidentified Analyst

academic the comments to Salesforce Nodify currently hires Additional you for franchise. questions. On for building And with the more if thinking physicians thank year. on into is suggested push calling hold Scott about how call your greater that Are prior [indiscernible] also taking this for you [indiscernible] And on your you at focused then community start momentum your centers. the are still right putting setting? Does so, true? commercial time planning

Scott Hutton

question We hear be really trying Great from we when Good Yes. are where and mindful you. to [indiscernible] of spend. to

we've like it's got that we being out we there, all profitability company, yet. companies demonstrating the a think other our and high But shared that a haven't balance. on demonstrating, we're a think growth growth path to eyes I

and be numbers. not same but that equal productivity each it sales blindly only And sales rate, to territory will assume is the they them that what same the can ramp every professionals, to hire don't gives so for the and want and at we opportunity and go that rep us, do hit out an same,

side both great on err before anything, do have setting. in out we'll successes it burdened a the the proving it if So fully in trialing bring the arena, professional. first, sales on to but the academic of also and community we We

presence different a both. pulmonologist. on would vary pathways. territories, focus going say the networks, the right upon actually strengths number territories And institutions, least now, to There's or across referral again, the I different But community are based their of it's yes, the different of so some based academic the on where of do at we focused

entrance But of clinical really our support have we've all. some got to institutions. of our strong from early focus we publishing, trials us, and major on with some the into academic for So

wouldn't I necessarily is lot we've of that as the I that prioritize one And it other. we've, So board. stepwise equal A fully success a we process. balance say expect over across the

Unidentified Analyst

Thank expenses savings And there any question. we are quick cost be that. associated trends discontinue about OpEx Great, for or as another With for we thanks. about that decision testing, you should year? then to thinking the COVID think

Scott Hutton

not Not over test really, we strategy you quarters last was saw use that that for wound couple part CDT really heavily testing we had of in into invest the COVID utilize down [indiscernible] our same the the revenue that testing is DDT, actually our and COVID the our business, testing. to our with of getting decreased. try COVID Part of to technologies we Nodify PCR for and

So everything now now being growth and of of being used used our, all supplies, equipments, personnel all are is the core in of the lung that the our diagnostics.

leveraging really next the year. long had for what to built we over scale help So

Unidentified Analyst

much. so you thank Great,

Operator

further presenters. so you may today's time. this participating conference disconnect. a you day. great no there concludes questions much. presenters, at And This you Have are Thank and now for Thank call

Biodesix (BDSX) 11 May 232023 Q1 Earnings call transcript