CSTL - Earnings call transcript Q2 2020 | Castle Biosciences, Inc.

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Operator

Good afternoon, and welcome to Castle Biosciences Second Quarter 2020 Conference Call.

As a reminder, today's call is being recorded.

We will begin today's call with opening remarks and introductions, followed by a question-and-answer session. I would like to turn the call over to Frank Stokes, Chief Financial Officer. Please go ahead.

Frank Stokes

operator. you, Thank everyone. Good afternoon, Castle call. Biosciences' financial to quarter second conference results Welcome XXXX

three Joining and only Founder, Derek Castle's or if me is today the to President August XXXX. recorded replay this Investor time website the of be will you're today's any listening today, Maetzold. may Relations of on longer Chief call company's sensitive weeks. the the page of approximately of transcript call, speaks be as reading no for XX, call Therefore, available information Information this accurate. recording on Officer, Executive A

I assumptions to events information COVID-XX of and XXXX. future to the or Before would we the Private of contain of pursuant forward-looking some other you or made of company, the pandemic are safe Litigation related the the begin, today harbor projections may the provisions like Securities the expectations remind impact future regarding that financial to statements Act and discussed of performance Reform including

statements no on change. the Report for obligation assume statements revise are December Exchange contemplated Forward-looking factors actual risks filed results I'll call and factors described the of only be and forward-looking the XX-K that turn today, based inherent Annual and in risks Form will documents circumstances of forward-looking differ company's realized. cause to the to other no the those from or update and these materially in forward-looking assurances A other there statements. and risks over could speak detail now in and uncertainties company's and be XXXX number Derek. and These involve the these these Commission. year results Securities and can to statements contained and in statements as with in ended current XX, expectations we as reports upon These are uncertainties

Derek Maetzold

results, provide detail the good performance and quarter, us I'll and seen COVID's recent joining second our our and Frank the today. quarter We, trends thank for afternoon, discuss more Frank will impact on you, afternoon, results This position. in we've Thank everyone. the you financial for our then

impact We're While for we navigating times. that increase execution from gross maintain COVID-XX. our year-over-year successfully by results deliver saw flow. these strong quarter employees, revenue our strong pleased challenging we're in operating positive a second the reflect and cash Thanks margins,

our with and we're making And maintain growth long-term who importantly, churn We and our patients reports. on test order the them. to for clinicians serve progress near test to diagnosed of DecisionDx-Melanoma our plans. with times DecisionDx-UM Additionally, melanoma strong treat in proprietary who have strategic test normal and access uninterrupted been delivery around

As revenue you report second by COVID-XX. volume expect and XXXX quarter impacted were would

was Specifically DecisionDx-Melanoma quarter the revenue in quarter report decline in XXXX. second an XX% million to second million, volume of the of XXXX, $XX.X the $XX.X second of quarter in second from the quarter XXXX. increase XX% compared of test XXXX

and dermatology resulting our a year-over-year cancellations melanoma. of order in trends test color Let provide trends XXXX test me to I diagnostic a demand cutaneous feel traditional test as report quarter thus DecisionDx-Melanoma to believe important volume for performance test on recovery and/or diagnoses report some the in closing it's is the patient visits test metric. remains as We and decline volume and in reduced provide have positive expectations volume. decline second of we due seen. the current key and discuss well, they this increased reduced insight practices Well here biopsies delays

DecisionDx-Melanoma after melanoma our remind by is place take me ordered Let biopsy you, made. is and of the test physicians diagnosis

pandemic in in decline largest party April. due Third the biopsies occurred data suggest to the

further in orders in continued in the monthly quarter year-over-year in improvement illustrate then In year-over-year second July. decreased we for quarter. DecisionDx-Melanoma of points the declines this monthly June increased orders XX% in by orders April. largest DecisionDx-Melanoma increase month data in and June year-over-year. our trends. second XX% saw outline have sequential orders Since year-over-year seen April To to throughout and decreased orders XX% also I'll orders We year-over-year. which gains demand improvement to-date April, In a May, leading

government in since saw positive the dermatology patient successful for common reopening wealth also We the data part pivot. believe the fund diagnoses. Further their according year-over-year published of support recovery. the coincided in July. is visits by We week dermatology of efforts restrictions. February believe our orders With seen April, we easing and We June April orders of with in by generally test to the XX, and XXXX, reschedule have is orders have to since state which team to improvement of DecisionDx-Melanoma melanoma driven the local promotional And this DecisionDx-Melanoma will its partly further anticipate business rate which clinics baselines. commercial returned we attributable have to outpace practices

in our driven the as seen government believe continue the on US orders we primarily local pre-COVID near-term will and quarter by test volume We report closely the DecisionDx-Melanoma third severity expect restrictions impact and These the and increase to such state trends are expectations we've healthcare test pandemic's approaching system. positive levels. of

the of DecisionDx-UM quarter compared to the to in XXXX. our reports diagnosed Turning quarter We second melanoma. with delivered patients of for XXX in XXX UV second test reports XXXX

we COVID-XX relative buying our routine to our test. decrease thus incidents the we're made of it the our as strength recovery DecisionDx-Melanoma interpret that to position earnings the the company we pandemic to the remain to observe order order through year-over-year we UV is to comparisons in expect the and call facilitate UM believe plans for melanoma As UV and and move to strategic that exam be our investing of melanoma. COVID-XX of the and we quarter we recovery some believe time on volume how UV first difficult in said current relates of diagnoses being about year-over-year monthly majority incidents a eye This On thoughts are shifted of the test the incidental impact due are in growth the to due to low in after situation. melanoma

of foundation these a execution advancement for XXXX. for now lay our pipeline as test will well commercial discuss our XXXX progress a second quarter, of I development, plans progress we to our commercial evidence the the evidence In test our remainder significant As and which team. on the includes recent saw expansion of appropriate by of great of use support and to coverage payers. publication and

quality, with both Academy were taxonomy system for or is of peer that meta-analyses For reviewed with current of demonstrating systematic quantity prognostic level actionable or publications the of organizations biomarker used is one American a to recommendation support SORT and as independent test and by and clinically the Dermatology patient that consistency to evidence. test to highest two cutaneous melanoma evidence of SORT level significant in one recurrence example, reviews support DecisionDx-Melanoma an this total such achieving in is evaluate of DecisionDx-Melanoma the invasive that strength risks than the of in metastatic uses The predictor XX. other brings number of test the the DecisionDx-Melanoma published,

guide plan millimeters first when treatment biopsy less sentinel is or decisions to is to and on X.X second tumor the use patients decisions. is the inform The of subsequent than use test thickness in lymph equal node clinical our

both believe commercial to payers. penetration market As previously coverage in evidence we stated, and investment development continued our by is supporting key

patients pleased test patients' identify pipeline, test, systems informed high-risk be predictor importantly includes for who we to risk. development independent strongest options. our we're This risk squamous therapy skin with our second decisions beginning American with three our metastasis treatment risk Turning and design expand public is our become only to shown clinical data the to September us staging anticipate demonstrate allow metastatic order saw a supporting in of hosting cancers. current which Journal stratify to subsequent risk of in quarter, commercial are with of able better DecisionDx-SCC with continued concurrently to patients the with progress of patients in We which decisions review was thus commercially at test. available DecisionDx-SCC for DecisionDx-SCC investors metastatic plan publications factors test Academy for to DecisionDx-SCC discuss early to use peer of can SCC. pipeline We're complement to on for DecisionDx-SCC risk The pathologic pipeline of clinical of not carcinoma and regarding the high-risk adjuvant were In availability. predictor also is diagnosed plan published services webcast of Dermatology test in our in our stage results metastasis But appropriate, other cell JAAD. management to the risk September. and more of and relative its validation our

suspicious in needed to pipeline completed for team second our use pigmented one clinical the Additionally, test. launch lesions. of work This our validation

billion of lesions will our addressable have our the a our As XXXX. we to a designed this a forward diagnoses available moving current product test continued test This more previously make XXXX. pigmented melanoma. increase second approximately plans in that with suspicious US And for to expand moving in the of commercial support test, become of to we stated, of second commercially skin the total DecisionDx-SCC and assist our our DecisionDx-Melanoma billion, loss team estimate market over half to out market. cannot that also with We forward a to we're is DecisionDx-SCC. but informed expect rule [indiscernible] $X lead lastly, these support We're pathologist as to for or products, be half plan test the pigmented US primarily lesions our cancer as $X.X safely of DecisionDx-Melanoma combined three total addressable benign growth in suspicious ruled

commercial net to with offering plans of You option position a development our to X and We full test. near additional common and proceeds more may we to term In to and pandemic. approximately despite in that to to purchase X to growth. recall an June activities for further support portion of including implemented million and expansion. million as strategic research of and On accelerate on our exercise we've important plan XXX,XXX underwriters' XX, of doubled shares their the support order We of that us commercial of of net July our long-term studies DecisionDx-Melanoma on these shares. further result the proceeds approximately for execute $XX.X in we proceeds completed continue a public a facilitate stock additional our $XX.X XXXX, use two million successfully team to than remain

interactions the study we evaluate therapies. The first is adjuvant which DecisionDx-Melanoma in personalized for of

to the collect up long-term test CONNECTION which DecisionDx-Melanoma. with [ph] been will outcomes is second The for XX,XXX patients who've study clinically to

we will on progress. detail more will over We turn studies relating the provide these will financial to Frank call I results. provide back additional make who as our information now to

Frank Stokes

message reported due main our changed. of away I want second pleased revenue strategic progress in made of and where execution revenues the We're unit and from XXXX remain in not to that adjustments of and is our fundamentals second $XX.X revenue with And Derek. quarter plans In the reduced to heading strong is we our XXXX, is and growth test call you, periods. by business long-term the per prior the XX% take the the today's to the $XX.X of business Thank increase from volume quarter. partially expectation second of on and quarter we million higher million primarily reduced related offset Castle's

revenue, test million addition quarter in prior million delivered our of of positive XXXX. to quarter related $X.X second test second includes to $X.X to periods period In adjustments revenue the in compared in

particularly with of to of our the XXXX, adjustments we XXXX. revenue forward, quarter second due margins impacts significant maintain to third gross second We're and XX% XX% lagging was compared in for the our quarter quarter also gross pandemic. of these anticipate strong during Looking ability the pleased in of period margin XXXX the declines to prior

result With the leverage improvement revenues. primarily higher of on the operating increased

period pursuant Our increases Health pandemic associated expansion and funds relief travel of and These the of by to functions for quarter distributed marketing fill products increased But growth providers million growth. for in to million that the R&D administrative US although offset critical XX, and due expansion million earlier personnel year. healthcare partially was million driven the increase what the and Services to from expense, by due R&D compared and the further our expenses on partially our during and expense increases particularly SG&A were of net of benefit $XX.X quarter XXXX to were same increases by in support well Act. to in that cost for higher higher The well CARES SG&A to primarily as support received administrative Human June offset increases ended last of organization. R&D our and activities we also the R&D operating automatically were and $X.X due the as the to Department further result $X.X million discussed $X.X was expenses to sales conferences as of our the of lower in with the restrictions. studies roles pandemic and position continued spending With related Derek we regard invest cancellation us continue we expect clinical $X.X these

last for the compared convertible due quarter percentage to a expense was interest on quarter due our XX% re XX% second the second quarter As quarter XXXX venue impacts second of for COVID-XX. were of to notes XXXX XXXX Interest expense of reflecting revenue, the year. to the decreased XXXX SG&A of compared $X.X growth million that on promissory outstanding for of to second the primarily

common IPO connection the July XXXX. As in a notes in converted in stock the reminder with these

to for flow flow of to first operating Castle's for compared to share of for second XXXX. $X.X year. Diluted holders a compared period year. provided XXXX million million cash XXXX and the operating three was common million the the attributable June three was $XX.X June June of XX, half cash Our by to $X.X net $XX.X million months activities XXXX. $X.XX operating months In net last prior XX, June cash generated ended provided million million we operating positive for by the quarter XXXX ended the generated loss ended the $X.XX was We XXXX, three months ended in compared to net loss months compared stock $X.X three the XX, $X.X XX, cash per activities for

mentioned $X.X under Our Medicare payment will operating reimbursement from XXXX second claims in cash in which CARES flow of quarter the previously an well XXXX of measure as relief compared benefited million be against future for a $X.X of quarter of million providers these the we excluding allocated million second CMS payments quarter payment flow to for submit non-GAAP advance Medicare the second as million $X.X applied adjusted was XXXX. cash later that funds are from automatically one-time Act, operating $X.X to for the for

of proceeds stock. June of of XXXX approximately June cash net we equivalents Finally, and from million at $XX.X approximately public had X offering our XXXX XX, common $XXX.X of which million shares includes million

of option additional public approximately an July in on were full additional X, offering common net XXXX of The stock. the Additionally $XX.X million. proceeds exercised purchase underwriters their to XXX,XXX shares

we XX, the a on our XXXX As reminder, full-year withdrew guidance pandemic. revenue COVID-XX May of XXXX in light

half in generated execute call products as recognize build we're foreseeable in turn invest will While fund from cash will our second growth. the remains Derek. now future. confident our to our plans in near with business guidance over operating the we year, back believe the We uncertainty the and cash and ability recovery sufficient sales long-term the expecting for remain our growth reissue company continued We to expenses this time. from I'll we to our on that of position the at current commercial and along be of not

Derek Maetzold

Thank you, Frank.

onto move anniversary strong Q&A. our express my gratitude with foundation their to marked of with as we employees recently cancer. our to to as skin dedication public Before Castle's want improving company. we people lives the one-year a I begins

quarter impact. the the despite second During COVID-XX

success. current your concludes execute Thank ready This support now to Operator, on continue interest remarks. remain continued in and Castle. our for you and future focused plans Q&A. on strategic we're and growth We for our

Operator

comes Leerink. with Thank first SVB the you. Puneet our [Operator line of from Instructions] question Souda

go please line ahead. Your is open,

Punnet Souda

taking and the for Frank, question. Derek thanks

be seeing pre-COVID work that in reasonable improvement you're levels quarter can first expecting point that in improvement we're yet. providing week that not potentially terms assume it levels. a of here first And there out is, the a not we the quarter. guidance you're the is of yet. there one get two to or and the I COVID with totally anything quarter across you the there reach was provide line should in could if so First recognizing totally to see Obviously, with that else it's to all But in - March third you're and just that impact off of improvement great that given pre-COVID

Frank Stokes

I we're report have actually visibility revenue. to is reissue triggers it is enough in. relates mind and for ready. think between Just to the But Thanks yet. like we I calling QX keep there in not just test and said, don't as that I guidance a lag do what report there, orders

impact that some because impact over between of certainly order was revenue most that was there QX. correct days believe in and COVID. still QX of you're cycle that of we report the But in natural So pushed means early

Punnet Souda

And provide reps the timing right - and the SCC capability about launch. also, And us quarter. trained of that's timing. the have of that assumed fourth you we product. sales that ready Tell land going around they're given corner? that given us that the the just of terms is Okay, point maybe terms the appears in It Can this helpful. volumes there you in the most there to go again potential to how on should in think at

Derek Maetzold

concur meetings I'd not science a to rest I rather sales I'd in highly ahead adjustments customer launch think I But and the based to period. as guess, in our in our effective we awareness pipeline this volumes team representatives our comment caution to from the made clinically team they'll training would that in first September focused a of here. has test in that or almost, medical ready the we liaisons September. up be virtual of commercial be both we So where go I on our here. effective about and national long and upon We available standpoint did the make sales time launched switch call expect have the expect national have talked training format

new the maybe tough forecasting in, get coming out time the think quarter over. you're right anyways. I that in almost in would XXXX issue we I if of because [ph] material sort by orders of nothing product is from But we is the September, quarter third would expect get early

is So the couple next forecasting effective the I first nice of look to would say, of will probably think of forecast handle at be launch first I after to year right the launch, a our anything staffed and an quarter probably uptake. we end of we'll you're re-challenge probably But a the end expectation fourth kind our the quarter. quarters indication at well is that

Punnet Souda

Okay, practice of great. with Can as you're normal current that's essentially us that patients. on, line and whether accommodate do or could because hours largely the [indiscernible] in was you a demand as pointed expect sort to July would August normalize we pick hearing I derm in were And September. see quarter business. out was you to elaborate extended across of dermatology expect if due hours it at or improvements the work across practices to ask trying list to some up the continuing were you to in were work and they and seeing of that some that asking of I'm you you the that

Derek Maetzold

apologize had with I Yes, I don't you that, so I and quantitative I share so for wish have one to that. data

I we delayed on and fit going they at practices they could average they four kinds deferred aspect ahead honest that's other up days to meant clinical ahead week XQ that, because if in They June and whenever the as sense if pick try of survey biopsies June, maybe days a earlier May catch the or and were we of a may go procedures our normal and you follow-up five on up and coming they own through from to appointments and of a of volume practices year, mean concerning position or don't [ph] also I of to and the over saw to proprietary call, more reopen or week be indication localized that's an customers volume. more well drive also whatever over April and that obviously between if hoping the cancelled their recall they income that would that probably sort a have in and visits indicated not. being had as for either were suggested and May, or last done July of presumably year-end working a and yesterday being year's planning well. As the or medically basis. higher last

orders points that us. all and to it properly at right would cycle the getting hopefully think by subsequent I patients treated reports lead

So guide on seeing five I that, don't more we is actually quantity feel patients but good or help, any that work at I going period can't to that that of in to of days same is to point one from four about data time. have you.

Punnet Souda

fair. Okay, that's

Just that? study of some is to adjuvant that study other elaborate be last Does personalized so therapy. and if one would prospective for a around and study, much. the can XX,XXX is increase maybe your the you of on outcomes it that sort for taking what squeeze provide that that patient on could for TAM if I expect details could the you study, study melanoma practice the study Thanks questions. that you of Thank changing, duration

Derek Maetzold

Sure.

that, helping you of I to adjuvant our on direct study So assessing personalized value focused heard. the little decisions test as details go in around we'll But later and is therapy our think separately. in really the more quarter guidance, the

largely those think I overall TAM honest. be our baked to are into patients

as orders do and clinician patients majority the patient etc. concerned and test the a However they're undergoing follow about or patients, how our same a imaging where from and/or biopsy semblance thinner procedure really I come of patient of afterwards negative less

TAM calculation rapid able that stage three be two, I top in basket market not of already have see to a might for we [ph] that one, but we of more penetration add there would our on current TAM So us.

being protocol lot on patients. clinically study, [ph] that CONNECTION the On tested is

patients. half and clinically we're [ph] around patients hoping of prospective to think have the tested true retrospective half the I recent patients

to data hasn't we rather set that us. for of very later, large also data a get level than certainly to can at clinical and going realize ahead very, us outcomes some establish that's been really diagnostic the nice use skincare in seen earlier So business be out

Punnet Souda

Great, thanks.

Operator

Ji Thank from line you. Nam And BTIG. Sung the with our next of question comes

Your open. go ahead. is line Please

Sung Ji Nam

Thanks launch. taking initially the the kind of a Could remind also follow-up on you're SCC, congratulations current leveraging we'd initial all hear you that strategy? there? to and go-to-market your questions on Decision us that target existing love customer for kind of Is the base salesforce progress making. the Maybe Dx-SCC again plans and to some your

Derek Maetzold

Sung clinicians. existing market upon One Excellent, clinically which for I base our based The up cutaneous an launching essentially think audience interactions individuals be base. target of it test and this and will our suggest clinicians with with is liaison this a customer salesforce that customer current the advisory eight seven test a of is that our research largely community our will is lines reminder to our medical and current our associate Ji. paired they're that, melanoma group be sales XX outside ones sales with territories then or inside staff science

this surgeons need trained and test current their we pinnacle skin medical level and sort of And versus practice focus to the individuals surgery practice orders customers So fellowship skin of [indiscernible] is and say cosmetic are interested those subset with most are or management of directly. dermatologist expect it medical that who trained are be most in dermatologist exact higher versus who our dermatologist initial in that these a a surgeons fits have more within in medical so the maybe not. then most are given dermatologist are uptake cancer which dermatology and cancer and

used dialog way, then expectation clinicians perhaps that test get have So they try more can quickly our to of answer with what and value one and assay is there say, to they of to and get more you with they cutaneous the cutaneous question cell our by squamous around the our similar to in already carcinoma. show people risk page a walk reinforce have who and melanoma and factors turn where know we out the a

benefit. your to We that some assay, of peers. Our in R&D let's guys listen you were see successful walk team an data if can developing and through

So as base target current right a group. that to dermatology most kind focus that's would customer a the now as DecisionDx-Melanoma be and will thinking we our will predominantly within sub-focus be of which

want Or just to is anything, Frank? You okay. that, add

Sung Ji Nam

obviously the if pandemic kind or kind given just private on if thinking outside you're more of side might in of on that. for more Obviously, just how And commercial progressing, the And not too world. generate you side. much be traction payer around sequentially into well and more if curious, curious With There's But this payers, this year-over-year. thank I'm continue I'm gaining Great, as just reaching of increase then there DecisionDx-Melanoma. the especially sure guys in conversations seeing environment, the per you modest higher if the also, evidence your payer the with on unit the that's quarter. box from revenue just will I'm what's to it. commercial going products the your

Derek Maetzold

maybe is and word. I I'll a guess, correct comments couple Yes, such a add can harsh adjust Frank

late haven't significant I a sort or for I'm interactions overwhelmed period test. managed say they two cycles properly. plan stiff early get now organized of perceived most policy that exception we've the to of more testing one DecisionDx-Melanoma directors do couple seen of hey, trying With COVID-XX our group we had where March, of medical accounts our April arm sort care time of right the in in by would terms review

I in negative of complete may think of don't of of to positive to cycle year. our some aware data. changes third maturation more ongoing to you Well I'm the expect should I the this from Most last that right in are though. have lead of to quarter some we review COVID related interactions them it's recall first sort I a number plans year. related every it think the the quarter we year, As from up think IPO that of is, positive don't that's now, think to coverage. I set

potential I because I the of like level is the evidence to level the publication review test of subsequent of highest-level net certainly meta-analysis think think that hard and system for ours. ignore initial evidence the represents

as So quarter. from move policy at to here the quarter discuss to the close through a quarter negative caught go third third of opportunity of a or to publicly what I'm an the lead unveil have decisions, change as into we least the thinking the at coverage or we'll off no coverage coverage some

Sung Ji Nam

Great there's business volume are makes diagnoses declines me. recovery just things prioritizing lastly associated pretty given a particular for or from that curious recover melanoma a deal would part a business that small declines, physician we're then other rate provided. given and sales expect to standpoint, just offices On etc., obviously urgency the your potentially melanoma. comparable of information given just saw new of curious delayed the Obviously, at to you with kind shutdown the how from if faster now sense that you

Derek Maetzold

Yes, actually. I hoping for was that

it I think just reverse Sung see to we're to going happen Ji.

the checked COVID spot you their patients usually US As trust of a XX% all dermatologist from your back literature is first who self-protect when can we melanoma how of did based up done first worse by do least that people they because getting in at out. or [ph] with diagnosed at say recall mole if would early it getting and review commentary, our end or it friend get that looking hey, was spouse you now, that suggest neck with may having either detected melanoma the potentially melanoma

is of away post-COVID of information think go to that patients would the models doctor anxious our going melanoma oncology usually it's because or In skin found sort optometry ocular majority in we've able up bit in they suggest with about really a a to the quicker are end eye glean terms UV ophthalmology melanoma lesion. visit. that comparison, that, specialists the which internal retina visible of their tumors our So a of routine treat customers the being diagnosing are patients that those or from not would that [indiscernible] managing we

be ophthalmology So for quarter. have I largely closed handle down the frank. good a on Well think don't to we second were given practices just

so, in September a or they their They're who and [ph] annual for that. prescription slower rush of a slightly I because to off change prescriptional had eye appointment we'll gets, if was April cancelled. for you their patient maybe was August see back it think going in recovery what felt going a so lens If that exam in is

to that to from disturbance gross being standpoint also melanoma not than it's accelerating going difficult a all somebody that a is with rather have So a believe later. sooner visual that's said UV

the the So anything, behind test. you But see melanoma is sure we end we I'm I low facts Frank? think that to can Do and add the of will the not of rare given cancer. so discern behind actual delayed want volume time, [indiscernible] issue the the that. kind

Frank Stokes

bit the is, I small here make patient difficult to the out. there to that think a more numbers little key trend just try

Sung Ji Nam

Okay, great. much. so Thank you

Frank Stokes

Ji. Sung Thanks,

Operator

Catherine with comes Thank line of Baird. you and the next our Schulte from question

Please line is open. Your go ahead.

Unidentified Participant

in kind from This are How curious June. Tom if a given guys trended. the of you're you you consistently whether is terms just back peers into Appreciate curious you still the dig curious COVID to is color quarter have we've on that early year-over-year same Catherine. how actually I in orders sort some know I to think directionally up trying July. pull the on thing? versus increase just just seeing I flared of seeing Specifically July, for I'm just in even said seen of it? guys was trend

Frank Stokes

seen trying in here have because more physician We it on or and Yes, people don't the think didn't, make at were come patients. to think And of in guess contrast just quarter-by-quarter up think when crisis topics look providers not they is effective, their these thanks physicians to for basis. retightening question. areas. some encounters reasons. want some be seen I I on do some a monthly dermatologist visit. and days healthcare the to variety I COVID things in we areas and tightening with But careful avoid early effect I in to a Don't for cautioning the that not the We've of disclosures for

healthcare, make the you Now providers treated healthcare you that's one most But I sure if of are needs. of to care comfortable. safely. for need think we're you have don't what lagging this. to those way in off you're sure impacts make We'll don't We'll a needs comfortable. and put saying your be of off find you your parts put hear country We'll the hey, treat where

maybe We're acute post-COVID I think so can't at why predictions. in find happen least solid its could to a of cadence. that's we so a lot provider good But been make the healthcare more yet what's continue then going normal in to really looks care like far that they've fashion. things to it is community a gotten continuing cautious, will practice have we know normal treatment had people they don't if

Unidentified Participant

of so thoughts get for I reps environment in on just virtually. half you could what more know front more just I and training as thoughts if to had the then on thanks a sort mentioned just launch you around compared sort done like the color typically some of launch? little the and just a sort had The to of launches behind. bit a kind any access to looks it think COVID strategy guys your of in Okay, ability or in dig of that how we curious one specifically physician would pipeline product But that back new

Derek Maetzold

but guess product normally would to excellent science to new of or sales I in-person have a would been our launch, going means couldn't trained to understanding most relying in-person other and some it as not to are standpoint, who opportunity. year those example, a from would small [indiscernible] about participate and for back setting, meetings some or typical speakers be up practice one-on-one squamous learn Those use say small upon exposed of cancelled had I speaking maybe that from commercial weak group team investigators of liaisons, could representative a I my train become test when training mix develop train but We groups. concerns dynamic. because or medical would peer-to-peer ideal have can for our to think of in maybe being clinicians you have points them have that information the confidently strong only a data, test in a as group investigators people cell carcinoma discussions there's speakers points so group individuals question that around to largely what be I

a sales compared to resilience a science liaisons calls going on by in normal see months think and little more of I to first the and individuals. we're virtual medical launch So some couple product calls to in-person

see I kind peer-to-peer grow expect in of opportunities think COVID that the we will up a environment slower environment. you non-COVID in might the little

we with As earlier. talked Puneet

if think the of of look sort end the next of back of we're quarter second the the - I first quarter end the year. day at at end we

getting major customers I has of be customer in we to a audience, call taken in able the won't Those feel engagement Surgeons that be peer-to-peer you would maintained the and are meetings that is we're lot virtual/cancelled. there think in-person pretty expect, programs similar our opportunities be thing American on little the given fall But big we otherwise test melanoma base or levels today opportunities would adding a sales nearly might a was the in might target it if that less asking, probably good as a the think positive. I of to But the is with use, would as the of going cutaneous as that add see say Dermatological from what certainly having the squamous because our the really you're about local year. I negative test and we this easily to away one fall on cycle. dialog you like normal our being cell think very be of different Society are that if sort meeting, reliance have worked

Unidentified Participant

color the Thanks. Thanks. That's me. it from Appreciate guys.

Operator

from And next comes our Masucci with Max Genuity. the you. of Thank line question Canaccord

line go Your is ahead. Please open.

Max Masucci

doc of or with recovery yourself customer targeting recent sort virtual of any over are detail the initiatives specifically additional than you start, dermatologist offer weeks can is What in environment? ads To months? current there just around for resonating new the

Derek Maetzold

Yes, two actual questions, Max.

say saw of one with our you XXXX doc did that XXXX I that that growth our sales X, over XQ, that, script think saw we release compared XQ, reduced expansion - growth as the was we I year. occurred acceleration is you last would a in see to on nice XXXX ordering guess the common December got new

course think that's increase did think the we time kind in just I nobody order saying able to a clinicians. with pretty maybe having in new good feels a across having country. from less of flow minus re-growth going in had that XX%, that period the XX, to the of March direct minus result visits terms XX lot and interactions to of for similar commensurate virtual I dermatologist example a of face-to-face mid-May see plus in in so late order to, doc, We with we're of

behind where the questions. I at. kind in actually because physicians began number that think is of of ordering a virtual who language that's don't that's being chance we're off group good data clinicians you shared think potential reading a to have as of being call really But upon effective a value on that's and kind go We go-to-meeting interaction small just think acting in-person and I the think or of the of don't which having Zoom deep effective part positive about terms of able of and have just that. to call about that about, being

it recovery in growth a new order doc think was I overall the parallel ordering of recovery of So coming it to growth. that like feels

in and do So that feels third of quarter, where be. business I good think terms for to? expect fourth the want we Frank, you to the

Frank Stokes

to I concur. wouldn't anything I that.

Max Masucci

complementary know to balance following Great, view you cumulatively studies. any investments financing so fortified. your other your I tuck-ins? internal Are that now accelerate change any your announced and on trials sheet to the M&A and you're and is there potential or plan investing

Derek Maetzold

do about talk M&A, that. won't can Frank I So

with So fortifying issue June and follow-on in the early in I balance late in guess quite sheet certainly us. raise for July the there positive was

the important in generation. with investing offensive in going into thing January get in most when We melanoma drive team sat to utility Frank XXXX early months time. both to down I XX going had point down we've think this talked management test cutaneous our be the data from we're again we that, about and As drive and was,

going cell programs squamous for with we the to the the by carcinoma and reach want lesions two December was the on to and pre-COVID, is and it end a programs, year so than In a us to successful the position test have you. of also had maybe starting go because take felt bank. XXXX one say, have make to We most to able we the was, launches that two and start end say, wrong or care this commentary we XX, have pigmented being in the expected job have product didn't before corner planned exactly and we're initiative enough pipeline mind one, of XXXX pipeline because to didn't being the to additional two test turns we of rather properly important don't we back our three capital we we choice

was So make factor. sure in that part business proactively and negative can for COVID XXXX to happens we to just raise XXXX, invest and of our the of goal XXXX, of be kind aggressively

Of it's more to reason forward. course push all the

positive. quite that's think I So

that spring, for of protocols initiatives, proceeds part we undoubtedly cutaneous melanoma. earlier briefly this DecisionDx-Melanoma specific about talked we the So so in the large used R&D initiated be will

just skin. I all for say can wouldn't the but weren't the impact that before cell we've is carcinoma published population twice as size squamous probably seen is we population progress, of what have our test of excited think mean nearly data of I I fantastic. the the melanoma

of as so we'll patients we be in R&D commercial course investments, program. that and pipeline full so bet of that test subsequent And to have you soon and as well clinicians value the investments can as that both as increasing possible can

You want to add further.

Frank Stokes

much $X.X time we're look, Max growth. product We still so don't maybe a which we're would happy to our to much that million so billion minded that spend another our we're runway a is said open for about take so that. sure. TAM ahead $XXX of M&A much got in Yes, the new in it's - [ph] note so just and in launch and opportunities products, opportunity us certainly and And outside XX% melanoma too of two looking we've penetrated area I we and having

But certainly path we're course got and to existing excited it shareholders, makes we've look something. for about we of if sense just do the will and ahead for We are ideas space at the positioned portfolio. the

Max Masucci

Thanks. me. from it that's Great,

Operator

no and to I Maetzold you the further further remarks. questions back at and conference for like any this showing Derek I'm turn time Thank to would

Derek Maetzold

Thank thank I you, XXXX for person and our continued in call. joining today Castle operator. Frank and to you your earnings in second want This concludes for interest quarter again us Biosciences.

Operator

This Ladies may great and in Everyone does today's program gentlemen, participating a for and conclude you you the conference. thank disconnect. day. all have

Castle Biosciences (CSTL) 11 Aug 202020 Q2 Earnings call transcript