NVTA - Earnings call transcript Q2 2019

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good afternoon. My name is Chris, and I will be your conference operator today. At this time, I would like to welcome everyone to the Invitae Second Quarter 2019 Financial Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session [Operator Instructions]

begin may you D'Angelo your conference. Laura

Laura D'Angelo

operator joining us you, earnings and XXXX good for you call. Thank everyone. for results afternoon financial Thank our quarter second

CFO; our today our Stueland, Officer Randy Shelly Sean us Chairman, Commercial our George, Executive Joining Guyer, and are Chief our Scott Lee and Katherine Bendekgey, COO; CEO;

press well listen includes our which to we as As the available, and conference you on encourage you results as release call, today's to metrics commentary have our financial quarter.

opportunities, to like make and constitute product I'd and investment begin, manage you we the that statements that on business thereof, we our future the timing we reimbursement our Before Reform our Litigation operations, including prospects, for our meaning financial services, that the remarks remind the and Harbor products, of Act. and and and forward-looking services, our businesses our strategy, demand on are plans infrastructure various provisions focus operating pipeline, and results future, of call of our Safe this Private the integrate within those plans Securities of not our acquire, historical in about market to

to could and our demand predict our actual guidance. therefore results It for difficult differ is our accurately from materially services

only the date could expectations. materially to We current Our settlements. as XX, conclude refer particular “Risk from that for performance March you any that for differ guidance on our quarter speak restructurings cause forward-looking assumes not ended legal future to hereof. in XXXX things to factors we titled the additional investments, do company among other statements or These information results business Factors” additional section the actual on acquisitions our XX-Q

available consider review in net Generally We in administrative research encourage to consolidated non-GAAP financial reconciliations, and expense, you are non-GAAP we the and and the loss our monitor Accounting press Principles burn. in and release. supplement prepared accordance expense, development general which States or GAAP, non-GAAP United To with statements Accepted cash

that, over the will to I turn Sean. With call

Sean George

the Invitae demonstrating execution investment execution Laura. barriers of you, believe to healthcare contrarian genetics decade information. in a the demand The most benefit health this in from subsequent such successfully as aggressive the utility access. of of Thank on for technology increased people can fundamental remove model is in led planet now or cost a of and billions of has could model to we this personal that

are of just current continues to need a guide in getting people they in United testing offering to Invitae diagnosed for testing demonstrating States information therefore with only X.X genetic year, cancer, Every care. genetic everyone their cancer, them comprehensive guidelines. more and lead fraction importance the but than million with broadening are with the of the science

people genetic cancer, of other More to the be to Beyond same in medicine. true benefit found inform access areas health their testing from we to have exactly would care choices.

the the percentage great in health can pregnancies full of a both per million mother currently of that the U.S. example, value six For be the from and and well-being of only those suite information baby. of the benefit for of genetic year, small

believes a testing. warrant those would screening making benefit also a Invitae without health in personal that traditionally family there clear genetic was history or available strong to

we customers. opened the of years set our a a of of testing With offering launch number to new proactive ago, genetic completely up

Invitae. of the enables towards our for have those gaining direct the on come from to is time same channel, that the customers first which broader ground experts clinical rely testing grade approach Our with launch commercial

everyone's considered gaining the clinical a routine a more data genetic barriers health broad information when utility information to day towards all and genetic and supporting a that comprehensive are care. testing, is personal in and moving value across access necessary people we success our part of of more stages grade life, lowering With of

Another increase to is biopharma through our opportunity such to access testing partnerships.

the than growing us XX programs of we a now addition the care more have them growth in quarter programs for in to with partners people including of to alone, than accurately and introduce ever, qualify treatments, dozen these a can then biopharma network, more allows and partnership that across the partnership continuum network second of our them therapies appropriate upon diagnose trials. With clinical programs. The help patients health

and prevention accelerating trend effective, result more cost screening this as future become outcomes. and envision more We foreseeable as strategies better monitoring, and the in tailored as better therapies well in targeted,

in approximately period In now we short very million commercial lives network. coverage insurance XXX a of time, up have ramped

the more the in importantly, care. the growing now engage importance payers starting to provision of health genetics given strategically, More are of

United are honored July to Healthcare's We Effective health that preferred continue broad to quality, named price in companies transparency Xst, seven of lab matter and care. network. one we capabilities, only especially to believe be

with advanced self-insured integrated to payers, world available, more we partner and around provider networks, evaluate needs, and in the Invitae medical to employers, information genetic for provider a will further genetics. more best tools as As the and and invest the various continue leader execute governments the position

to revenue few in XXX thousand where to We grown hundred from are XXXX dollars we are proud have samples a now. and

Invitae for testing and content on XXX cost XXXX Our is genetic than investment XXX,XXX and capabilities. lower us [ph] million platform, of our to to of the obsession first the than in This our more across another of as progress the our confidence rapidly time same guidance of in year in and our samples half gives deliver add we revenue. ability more at

across genetic easier We continue to it as our information we to and competitive moat access in deepen widen even life. needed stages all make now

financial to for now to results over quarter. our turn call the highlight the Shelly I will

Shelly Guyer

you, Thank matters. Volume Sean.

accounted samples for all accession again XXX,XXX. which over posted we Notably, segments, the XXXX. growth volume total XX% than nearly to second especially a growth in international of volume with We quarter and quarter last of growth more billable an have over from We of year, volume the are XX% this accession from a accession pleased quarter sequential XXX,XXX markets, experienced first XX% strong of volume. across

Several modeling comments business think forward. how on moving to our about

historical with volume second our due of that same, expect the but This volumes quarter, is between seasonality accession in appendix. volumes slide between larger billable as quarter, billable nearly we the and billable difference line experience the there third in in were small on to will shown a gap and accessions the in accession be the the in the quarter

seasonality you as quarters. grew tracking and and the the experience X% And, Last our think to quarters. the between third how growth we guidance? our year, between that we normally of And second these about remember year, are remainder we accessions, in only

for the year of the the we in accessions We standard over six year samples over with reiterate guided of our of XXXX. accession months to XX% first XX% over of the XXX,XXX We XXX,XXX for annual of in guidance our half first the guidance year. volume the

XX% In represents revenue the second quarter, in year-over-year. revenue, in generated a growth we quarterly which $XX.X million

revenue XX% This from payers over and just partners, both our of patient from pay. quarter, came party XX% under including third and institutions

due The insurance and third the del/dups payers for Medicare is in paying of as effect as continued largely increasing from full increases to percentage from well payments. HBOC Lynch party the syndrome for

HBO onetime ASPs last year's $X.X this of average in for del/dups. quarter quarter, a from Medicare $XXX payments In included second million which $XXX terms benefit for down was our

of write comparable payment, quarter's some $XXX, up to is first del/dup from from onetime remember $XXX ASP that would the year the quarter's $XXX. the been the repeat. have we we that downs last And first don't this had quarter number expect Excluding in while

in trend believe Taking these lower will that but account, our the and have ASPs changes. around we into see will bounce as ASPs payor term that the we we our bit, mix a products near

by pricing contract and are into the tests these like from changes. more offset growing areas third that expect get businesses increases small and be to our ASPs continue but quarterly collect patient payers, we in mix product pay we as as the party As well more international in will lower

growth revenue pleased that underlying believe quarter our we this from with experiences year only the the is due our in quarter, follow historical that While volumes. to revenue third are seasonality trend. this slightly billable this quarter, We our will up traditionally second strong

Recall first We with XX% the quarter We guidance suggested our million of we of revenue this of annual $XXX revenue our over revenue annual in year. on guidance. first half XX% sum, in second achieved year. around in in our So in came reiterate historically had of the for half the track the that is that XXXX.

In as to RSU our stock-based compensation expense million and retention per quarter cost a quarter COGS primarily representing XXXX, sample which reduced average and $XX approximately factors merit-based the $XXX an from down including grants well increased per totaling the launch. COGS large of The $XXX higher in in annual direct channel of from as to other NIPS we for second related our added reduction due to $X.X sample quarter XXXX, of first for sample year-over-year. second quarter a the XX% costs the

Just of on comments my a reminder past COGS.

new will bring and online. COGS continue as expect We to technologies we products, introduce fluctuate new

Importantly, we new newly put gross on will to commitment uptake to COGS. make XXXX to target products depending products, have on introduce worse margins year made intend could and a margins. investment, we upon pressure We and acquired continue a XX% those of the products, our of early and technologies Invitae’s and

than versus quarter more XXXX. profit $XX.X We the quarter million second XXXX, second from million year, in in of gross XX% improved the previous the by generating $XX.X of

del/dups in XXXX, aided the by onetime This margin been of quarter, payments from gross benefit for was the up without and this our XX% Medicare have was would XX%. XX% second which quarter

products of foster beyond, offer to discussed additional this As investing in last stages several of across scale year business life. we our to enabling the all us growth quarter, are and and areas

cost excludes million incurred the The of our what $XX.X business, acquisitions. XX% to which explained that But we OpEx operating the can you several cost impact the of of increase our million XXXX. be factors excluding quarter second was quarter from quarter, $XX.X the For of to $XX.X in the of understand of the due structure of changes? need an so current expense, the increase further about first that are from revenue in million, base

of retention increase to the First, quarter, primarily stock-based second of and RSU annual merit-based due OpEx million had an we grants. and in compensation $X.X the

million expensed the we employees, granted stock-based in R&D. expense compensation bio RSU to $X.X is inducement for to singular which approximately Second,

$X.X acquisition Bio incurred over is which $X.X of we Singular to accounting for And expensed related in Third, the costs we fourth, legal options for close onetime and transaction upon and the the Bio acceleration Singular expensed costs Jungla. million G&A. million in of

the remainder OpEx base to The from increase business. second growth in to of was our in quarter first this due

sales support the in costs We mid-February our $X incurred to continued and and and marketing and additional our marketing quarter’s total and selling in selling of June. over we increased early with approximately and our headcount launched increased launched in to end direct offering, costs marketing, investment In R&D at our NIPS $XXX million. channel

business, our for improving the costs scaling R&D, we down. content on preparing continued headcount In and our driving expansion focused customer experience expansion,

let's million. end, At cash and to totaled marketable our equivalents, restricted position. cash move Now cash quarter our $XXX cash, securities

$XX.X burn in Cash quarter million second totaled the of measure, XXXX. a non-GAAP

quarter first would in throughout increase we throughout the indicated our the quarterly our the that call, XXXX On would invest continue we and year. that business year burn and into to

the when to in For anticipate to more to XX% year, compared up we burning XXXX. XXXX, continued

$XXX in burn high Our as be XXXX. million could as

cash Our operating of financial is strategy to focus the increase on flows.

path elected we've our push make and investment. to GAAP instead While of year profitability XXXX out a to

to with We on to swing hand. will the maintain resources company the the to operate ability, profitability

per In our net loss non-GAAP provided have we reconciliation. press release, share

payments? you these think for equity quarter have payments until our obligations about to Singular We should future completed. Bio reconciliations been milestone will our every How provide

If you combination not acquisition expense, look several related the million totaled which expect will post $X.X do categories. performance, payments quarter. at future for you see this We

from end were the closing million stock-based charges see These will deal charges. the large acquisition of you days for XX $X.X the quarter. to However, related compensation

for from As separate forward, related compensation performance include based our business acquisition will each the time quarter, we we grants. out based break OpEx. base Each may both move these expense and quarter charges,

that last over longer than call this I the expect now We two to will would back no Sean. turn years.

Sean George

time, data us and could The both direct genome of clinical whose testing. continue people genetic technologies Thank initiate at expanding the enhance biopharma more tests from you, first presentation on to of Shelly. demonstrating for benefit genetic quality conferences consumers Bio enable partnerships. work a business, with the We've and to more our and our had the that launch with busy network of Singular our channel scale Jungla a acquisitions grade of to quarter, strong and various the

over infrastructure the We've Technology the double-digit growth. pace game volume years. our integrate and explosively platforms is company picking will The matter. we've industry's to run, long over up, several demonstrated past ability continuing scale the grown of and the consolidation to in average the win acquire XX technologies last and the quarter-over-quarter and successfully quarters,

in related is in the focus position all industries, the working, the in fundamental corners Invitae Our of importance to and healthcare globe, information model of right the new right. is into genetic of and is era coming Around medicine. is lead this timing

Before move to guiding utmost us and to is we gratitude for deepest vision for just opportunity a all entire industry. today. Randy, wanted future light the the publicly take but who my of the here with across Q&A, I many not us here been thanks express to His has Invitae, to for

the much you're we’ll in for continued and of and his as forward an many internal you've miss involvement to the industry, world do of large. I for company. to While the our Invitae, things everything him friend look strategic Thank direct and done, more very at going official Randy operations you working the future the the brainstorming company, with

Randy Scott

it's team here in about the the is part Invitae I Invitae my a ecosystem. more but an Sean. opinion a couldn't Boy, being experience founding and just entire be Thanks, of building company, future, fantastic really at really been a excited because not

my cutest XX years, is knowing it forward. put So take the starting retire, is to as kids ever I and up for wife, in and amazing some companies great seen, me and with running three going who's spend really hands Invitae that time with and grandkids, you've of

and a plan in So to going next is partner taking year and time after investment being to investing a forward. ecosystem off, office that some Invitae I great open creating the continue family

guys to just just me to team. work really Invitae shareholder joys time. plan long And let a for as a I a to not but So back to the tears been I be that over very with of you turned one Sean. significant my call, life say very that, the for with It's the only roll as great

Sean George

with you that, Thank the And turn all to over we'll for the Randy. for Thanks, of operator us. call Q&A.

Operator

from question is [Operator Tycho Peterson Instructions] with JPMorgan. Your first

open. is Your line

Unidentified Analyst

Thanks. Hi. This for is Tycho. [Indiscernible]

margin comment you XX% do Jungla to key can that acquisition the and Singular expedite the to hit on And timeline? does Bio hurdles what goal? what gross addressed term are First, to the be that, for long

Sean George

unknown will plus margin moving maintain I'll which of within Yes, that of I'll all allow the -- that, target. that I let the and puts the globe non-invasive our discussing Bio we in forward. Singular Shelly updated pregnancies I Bio, resolving a spent up where our can as couple that gotten the see the comment collaboration backdrop points where are. significance we line, pilot in a are reduce well around exactly screening reduce there think XXX will we've we against impact in rate hit for prenatal them affect think technology to are that the COGS now months an could us on exactly say to million Jungla, have to know course involved we where we That I our XX% again months, price labor or those. we we're going And four Singular to together. before of good gross with variant started actually significantly really enjoying start and in teaming that Shelly takes let as will at -- and larger a of the impact speak plus

Shelly Guyer

question. for Thanks the

quarter. gross this So XX% our was margin

that, jump we people above around and been have that that headquarters that have it anticipated would We we bit. told a

say us tests and begin we party that more, by payors reproductive So from as going it's collecting is we sorts the given that tests, diagnostics target, but we at tests, to not more third also look higher not insurance for up to be anticipate specific, as we it to and of a other rates only some other can it, that rate. those for collection oncology get the drive pay of let's

Similarly, in cost we respects. control have many the over of

be should able been us of help interpretation to time. For down, in scale Jungla also and which enable us over Sean some lot but the a to instance, we've of putting those money bring mentioned, medical to costs as

term driving volume those control down. have the throughput, us more much long to really it's and costs So allows which

always more can be try pricing to can to down. and down or collect have the that trying decision in down, decisions have So investing whether aggressive COGS to specifically will is we COGS, that are we either we're to on that, or the around. With bumps we and quarter it's drive the the we or time, content more will to that bring whether mean with or add the drive

So available it all assist helping business, and say are those around to which will any of our XX% us around of indicated that around XX% in we've those to will level. levers levers further is of us, those any one jump that in why that

Unidentified Analyst

That's Great. institutions that mention volumes and XX%. just from helpful. you And were patient under both then, pay

you're platform of And patient So that sort how is the the evolve? I launch positive wondering, seeing ASCO? early what was traction to testing following initiated you're expecting at

Sean George

Yes, I the think, Katherine let speak to evolution it. of the I'll

early three the to different. think here volume and I the also interestingly, generate you channel quite using institutional are is for that of looking people and And payment -- insurance all we for types, type build interest and magnitude we're and I of on of products. I an as. patient think that, direct the people on but expected, of expect to that the expected, I -- important know is the early again The to think And all what consumer you're accustomed type think yields mix as bill. returns I direct channel driver of three is on pay are both in kind those are channel that less measure, basically channels where of a kind mix than spending orders think, that modestly as we're

tests, for qualified and through for indeed payment. are coming insurance in that direct are Some diagnostic channel

part as in one of our XX that of access which biopharma easy of is a key uses a coming almost know programs, that partner ease feature. enjoy you are Some for and

finding course and interesting of are information willing for they're to some this go themselves. just the then And pay process enough ahead and that start

three in So, will this payment come types channel. all through

what the broken speak -- in clarification, one-to-one out Catherine in that, as the and So not that I it's expect the with it's queues, to with think can as a But future. correlation. to

Katherine Stueland

Sean. Sure, thanks,

trust this years relationships genetic uphold and and clinicians So we've ensuring half and continue brand a a other are on, and to importance have five medical that really that new experts direct-to-patient paramount rely brand strong those grown spent that with we that counselors, genetic the really building as to that channel of us able channel, introduced initiation. -- to to introduction our was of and we

from after initial And was with positive. did clinicians response education some so we on it the them very

of we to And there experimenting pretty spend now with strategies and our marketing several minimal digital we'll the and mainly next right continuing so are, spend. to plan months nascency experiment various with

we as budgeted direct-to-consumer posted what do magnitude you will have mentioned, learn what be or spend. orders ancestry more, less our but companies looks see currently is more you our of if intention to it that than keep we than pharma We'll for spend Sean be as

this year as So as we channel, but XXXX and to to the direct contribution volume we've more mentioned minimal beyond. the in past, look from

Unidentified Analyst

from you last seeing pharma from Thank partnerships briefly Thank you. us. on Great. how And and one evolve? pharma you're Can you. interest comment

Katherine Stueland

adding handful partners existing partners Certainly, programs is and to of things. added programs we we've we're so too. programs to quarter, seen and existing additional additional are One, a XX additional what adding this we

starting pharma -- will some So channel. within to see same-store sales, if we're some you the

additional heart And one muscular least new screening cardiomyopathies prostate as on unmet signed to LSDs tested. Detect because arrhythmias. cancer, and at for the who forward seeing looking programs conditions have well, and those and patients not partner several to what returns those where addressing really we're really bring partners dystrophy, they introduced needs for we are and four are also on programs we're look are programs to We getting programs, on

to where pharma companies areas. these show testing also where investing the in of utility These are genetic are areas in clinical gaining are are conditions data And in these similarly, currently they research.

where it able really they those how chose those in of areas to looking generate is came that be terms four So in to and data up pharma were we areas. conversations

and to continuing well as So, build growing really pharma strong owners. a of network patients as

Unidentified Analyst

Great. Thanks.

Operator

from is Cohen. Schenkel Your with next question Doug

Your line open. is

Doug Schenkel

afternoon. good Hey,

know profound getting world goodbye. I say on a And impact this something break for into want long Before just a to warrants my the you, is broader Invitae you've had rather very that or Randy, a in of questions, the and action just than genetics. I so

we'll So talk I'd just soon. say, congrats and enjoy and it,

on effective at to So, being the on have I my or drivers. United really of of this growth year July first some drive is to Xst? that part guess Is the is you expected something on, What do PLN volumes point that impact question the beyond? to expect

Sean George

Yes.

all I tend is take months These I'd perhaps expectations. ironed and get ironed that you I think be get think to to the a kind kind working we've months to out, been that the meaning years out So systems rolling think, up programs. in over early to in months the likely of are systems, six these the three are same freight, of I many our say programs out. payment know modest. with get the the systems to while so are full The struggling to same

the to take iron -- tend they a kinks. out to while to they So tend

is relatively With longer a commercial it you effective of that know kind States, effect. of a the insurance piece and that storage strategy. it think important term of a the in United do think of very they term certainly programs we is near These commercial our said, aspects in I other have lot are an business,

who people appear always for start it that line begun. and to have and didn't going many we're asking information had at looking looked talking are point testing, has years pay even at we some the that we genetic what We in that understand questions really like suggested suggested would about, but genetic it for item time

us next the that a strategy. driving we suggestion many looks of has commercial that the again, the day always over year with information, help that providers see And that increase part leader And you it it follow I of we looks it expect been to as our And that to United that our over purchasers The expect time. the volume. in for will has influence know it, the like do like, are suit. that we in more come, think and

Doug Schenkel

Okay. discussion guidance another send quick assumptions. on I'll a Segway, I guess which I'll growth question, driver

on So what these second non-invasive the half what's the account on going? IPT in prenatal testing, especially that in an -- on given the QX been impact new in guidance is the And implies, QX. expectation accounts embedded guidance for early growth cross-selling ramp that your to

Sean George

Yes.

the it impact and setting. offering a and other along pull I at NIPS I QX. that with health also that year know of reproductive have with new definitely and to allowing on still of looks setting creation in there’s would impact would the us this year, beginning that this indeed other, you summer of we of accounts point the carrier many -- -- the QX it we given its the suggested of So seasonality break variety At the tests

a and wildly it's year in on Nothing's impact will end different to QX, the significant year, the of hasn't still it we be hasn't, QX happen or launched the toward our QX, it the nor Yes, QX. way, put of excess into the and there, going our of of outlook. end think driver expectations changed that's major it do end of

So know it's a launched months few expected. you it's we kind as proceeding of ago, about

pickup. account new seeing are We

see growth an That out start in of health not playing year. the conversation. was reproductive expect without it we're IPS up end in accounts the is indeed that suggested having and our we and interested that again the health picking some to it toward reproductive just accounts there we know You do

Doug Schenkel

Okay.

over lot clearly momentum you have this and of recognizing a quarters. So quarter, had several

about of just clear XX% growth would just, seem sequential terms to to to XX% about that growth. growth QX. to for you're QX volume imply sequential the That be you you're QX math, looking sequential in think QX, about said know I You of assuming volume

NIPS an through seem surface. momentum walk a appreciate on Sean be again NIPT, the there's at a just So, what and big lot on does here, but jump you that of least to I

reproductive So give the that that -- is to? NIPS it. there be it of target, us should something this more of in to we else these is achievability addition should confidence looking in that or Is

Sean George

not it's reproductive. only Yes,

big reproductive chunk So definitely that. is a of

in are the pharma volume. uptick partnership We seeing

So that is, that rapidly. is growing

international seeing, are kind also last is as of up the we picking business highlighted We quarter, pace.

about all the I take big when and last conversation confidence involved this also, it's familiar And brought us This is. same we and gives of I those because I'm had a a year. QX so is that's what very QX you think exact you think up, glad conversation.

growth. very it QX, seasonality is At a gosh, remember such of freaking real, a was have oh you were end that the X% it way monster The is only People can real no factor, out is my big there's quarter. QX definitely quarter.

I to guidance. think in exceed order, seasonality where we're, So shape great meet we're the we when you three in plus take -- when those think factors the you take and

Shelly Guyer

start there productive quarter that, and will into we uptick all be – that the in and the they quarter, time think to in people get only as it sales they some the would in our mention that on we I force and fully tracking The is we did that third that in that quarter fourth by time. late take expect to boarded, point those

that's So gives confidence other one I know… thing you us think that the that

Sean George

a Yes, point. good that’s

past territories around, of gives up factor in the late detail finish last we The new enough, size in that month that the really the time the point a a process entire contribution The three January. been burn, typically course small -- think we've the then April, that's from worth that, bit didn't I and ads the with added and of it's until other to entirely on of almost and the new. the new, new the we've of the six one of reps. month where

Doug Schenkel

Last terms last in in of one you I or in you. on work flip quarter, given question. Anything can or had your worked side; things you. this There accruals against working can like against or some that your worked it clean-up favor. Shelly, think And quarter of Really that? favor can be be just for be that's Okay, some the to helpful. any reversals revenue worked -- there a reversals. reversals In accruals in terms out that you may call anything quarter,

Shelly Guyer

was So that going let that time and for the historically we of one and million, the had in me between $X.X the year by for full was that tests that answer year. differentiating and second was that quarter del/dups a back last pickups non-expected

to to this able year so was quarter, the that this you So second have some the comparisons of have an apples-to-apples that be quarter. $X.X take out with in to

The that and time we Lynch $X.X fourth million, Medicare, was that syndrome. other time for in the time also one that got pickup that but from was quarter,

This out. one time broken year, had any we've those have not we that of

at If you in charts slides, you our the lines. dotted see any don't look

of So from order some quarter, our weren't yes, internally diminution down. we And prices X.X largely the institutional that and factors. and as about things took took, first some those of but expect we had exogenous and did was controlled They million we on acquisitions reviewing probably the was it the some and from in indicate, things. related we to they it were

then or find means you'll in better prices, those were of set some in have anticipated. quarter, you and is had hope just XXX that always in we those. than our in time, I the and collections that historically of now you that filed, you amounts is will increase your your changing In quarter, XX-Q across we you upticks. collecting general, conservative rules million the $X.X over which can as What expects we're of under every That board this see decrease

and our under that of we XXX those all quarter. report quarter up, looking that business and and saying were So what's of to just and spectacular. collections on this we'll what's quarter factors, continue the at do that's and none forward, every just All we'll $X.X those course exogenous down, but million, normal this. move Nothing are as first

Doug Schenkel

Okay. Very helpful. Thank you.

Operator

DeGeeter from is question next Your with Kevin Oppenheimer.

open. is line Your

Kevin DeGeeter

extent in magnitude what that channel, volumes With you just some the through on through a do about taking a as be contribution give questions. -- you are to patient to quarter congratulations pharma bit to framework of really uptake channel? biopharma little that thanks in have may you change and that a seeing now relative order driven initiated strong to of regards also that phase for us my guys, Hey, and of part of your can channel, kind are talk access the

Sean George

of it high revenue I mean shows you Yes, can want. there then that varies kind filings would revenue the know I pharma break but represented of just we academic can business, a I there. we that's of go a paid in the and think out the kind you good you level, that you in into institutional don't very it's a say, little institutional. up portion details versus institutes, know The

I and it said, our is is that both a significant being On factor the our now the the and that menu. entire encompass break clinical overall areas certainly we the to growth albeit, business pharma the revenue. business are revenue to basis, new and frankly the volume of partnerships contributor our growth, of disease don't out still driving would say again, the just by since kind beginning

So a rapidly contributor. very important growing contributor,

know You business important, I on it'll -- the the digital a we direct it channel, pay not the is too, do up internally swinging continue and The again, the and thing there's get where we -- but is and will advertising. then it's direct look at point and key the be whole very channel, so the think on there's continue tripped I contributor. major clarifying the the factor which this the marketing patient to just frankly to and on is also or worth things volume, this thing not think we're sales a right, grow,

insurance a channel today And either we've or launched, recently In in efforts types. institutional that business. we the can both indirect just build produce those seen mix three of pay, all patient channels of payment

And been of the know you that's given the minor on. is, of you is -- at that shortest all there's payment and broader impact direct types, a so going basically answer on best to everything against of give activity your numbers the scope mix marketing that the small and channel fact the question business the overall

ordering much a large obviously because, Now and And channel. I you pay up families but of the also details, tilt to in mix the ease think people come think us toward of credit patient that's think clear, will direct that’s and to the in become going driving. too kind And that of that's as would we a that over cards, the we in again payment aspect a that -- through pretty channel expect -- Catherine without pointed take with institutions of the start number see that, bigger, are will on pay, use, volume patient going institutional. larger out, we portion to years to become and

could physician can by self-insured and large And etcetera. etcetera, those, you -- groups, employers, imagine employers, player practices, you

reach and -- around for a academic easy to with to direct the people with just logistics. it’s addition In which testing much easier globe a centers

hope, I that side Was a think, wanted pharma go answers into? your more on the I detail to question. there So you

Kevin DeGeeter

in No, mean then amount that's been there question. just fair maybe strategic M&A very more sort great. has group. And a the helpful. I It's activity one of of

had of pretty last of style get given opportunities Invitae currency the of as years transactions. have your there and be where thoughts commercial oriented goals of you've to might retail, bring assets stage kind any technology a in of the think terms I larger kind -- clear couple pharma into strategically rapidly, But to over bolt-on, the in path you guys? in to particularly the here more more stock, the some more longer-term

Sean George

wildly think again still undervalued. I well, Yes, we are

view this way and Look, the and industry the way basis, a on we to we that is it question the -- the throw we've I telling that's evaluate Kevin, still there. both a have one-off actually, in to it's it's built business. how of think the So how a way

really to businesses and that doesn't multiple in multiple with adding and -- running just we have kind in the view acquire them clear to into is of the our we technology COGS pretty running of path Our get being and a to platform fully the M&A, to need. have of filling logistics platforms on us able integrate parallel that targets bolting kind gaps

have the platform. Look, data completely are flow that they so path smallest in all And to to notice in you'll largest data the or of flow kind the the of the acquisitions more there integrate the clear it bit of the answer question and a platform. very we is relatively a a the are to kind less our things into way integrated is marquee of from of

really I amount think And integration kind start you at goes harder becomes more the harder dramatically, that. yield assets imagine. I'll leave and It's different, that thinking that the a I when about amount traditional the established, think the I much, but of up more of commercial much of larger work it not more just no, say approaches. work and to would the the and

opposed to try to technology by sense a that in to stack to a And or examples, lack conclusion the not a those into it's those of on way for at, to the we build investment, is of modern come yes capital the as necessarily, use infrastructure trying better only you no. integrate one, but in consideration. it -- new the looking again often give in, traditional of the to Not

pipeline things. have and a pretty sourcing a of active lot we we I and think M&A diligence consider

Shelly Guyer

would partner versus the in. we would, is, Shelly. would The thing it's buy versus I Shelly. I look I yes, thing -- It's thing only at only there only Kevin, make add The the

on developed area Remember So, two stack partnered as decided it could out six that that and were reproductive do as originally a for actually we on in new own then better acquisitions, internally. health. of of that you we our may recall together we a somatic, did we probably building

partners, at be so to that that build whether that look are we being of reproductive by whether our asked be will etc. somatic, types full suite the And of complementing products for

which only type opportunities AltaVoice not We these us with will remember helped into look at dramatically COGS. got partnership the all with business. technologies, the then the But ones and two recent

look the And our etcetera. across partners and so at by board requested at users, what's being we'll our

that can the been to best sticky so that to of all suite we've about use us. make talking easy customers it And for cost, offer the and the accessible our all we and build products vision to at

business we And across where so various all of that's to contributors development. our those look

Kevin DeGeeter

so Great. much. Thanks

Operator

[Operator Souda Leerink. with next Puneet question Instructions] Your is from SVB

line is Your open.

Puneet Souda

non-invasive on first your If the help Yes, are and thinking of could the Shelly. derive I us the understand hi, Thanks, technology. touch about screening thank maybe you COGS and from market potential Bio you strategy you. reduction prenatal opportunity here, Singular Sean, acquisition NIPT can broadly Just

bit the you've timing or you could since acquired the you weeks elaborate had little more bit couple of sort this of a And given a little more a company? of on maybe

Sean George

absolutely. Yes,

high you a I back. think level, just kind step know let's of on the on the take

mom considering to about stated in. tests child one the check and genetic and from There dozen in through Our from are year more half not baby. may woman may the a know or or health a both anywhere a outcome pediatric goals all be way that currently reproductive aid you healthy having healthy and run are

the test, fertility and amnio screening, take that genomes, run everything of a that's we of everything – part testing, six are panel and U.S. very focusing percentage year, on all general of very in there care prenatal may information a near to metabolic the Just up from and non-invasive them upto reproductive today future a exomes really pregnancy including as from future. what near screening the is care that's the very we're neonatal reproductive million pregnancies the screening, CVS small newborn that suite kind type include relatively all the of in in a complications,

So million, as that go that's and kind market, per information. how it clinical health of through just that journey could that think reproductive we view the are U.S. year use it's of mean in going the I X to

more half world, over by not all covered wholly, so covered given pregnancies. by insurance. If you whole some a some by are actually I are covered dozen are million XXX partly, the of are mentioned by or And of some information, that insurance tests, insurance it's insurance, some think covered

-- points. kind cutting-edge absolute little pregnant globe, in most we of to around and would all And information that will that. the there make the price possible an the every so associated chance that sure women the as how best our depending individuals information those serve what much arc, view with and receive getting we on individual is leaving the as And interested plus a in million points XXX the that price want price different that be way year globe up can entire to become have points that to like

prenatal backdrop the long fairly to reduce unlock of price that question it. be the that that the to Bio -- we and will hitting for a demand as really that goods essential points for true Singular cost global will that non-invasive with answer allows of some think the screening think us So dramatically we in

-- terms There The get team XX of them. their moved And it that's the pretty team laboratory are we acquired blocks we've thereabout. within we here, They where it is few why simple. a is development think can somewhere away. logistics were or course we was now of -- months production in has months XX -- already into

to and an small by would for that that innovative I experienced this you the the acquisitions, no and some timeline is well is Invitae focused environment able and other, with been as culture to pick in acquiring add many is folks our great understand of used the we've add pretty that talent the very up, acquisitions the And to tend technology you exception. pick pretty, unforgiving to working we've be really all really our way that shocks with start-up benefit -- other and up

Puneet Souda

Great, detail. thanks for. Thanks for that

we're bundle, and more that testing you steps, I seeing hearing just that and NIPS a and about, overall expansion expansion talked menu testing if think taking seems it where is number effort screening opportunities all we like know look have directed opportunities which I or the a patient have the about bit Invitae little So could that ongoing. of a that you -- back proactive pull is you there you've carrier are at menu

and DETECT think And prostate the of for and it July that started health then condition. for, I on in dystrophy programs top other muscular you have

year trying I'm to how tests efforts to that of sort we and business, and So some cancer? more Help those XXX,XXX your is was hereditary the should from breast million the essentially. core and which going understand expect understand which guide, in much we contribution, a put us framework and full when ovarian together of versus of doubling

about volume these these we think other, we what And expecting how the additional -- two efforts? sort of over be should should next next these sort drivers from years and of the driving

Sean George

this a the covering start that to cancer that guidance associated it subsequently I it's all about cardio XXX,XXX for to whether will of and we that for the arc question. And samples of with no, and providing that think is kind Yes, Yes, the it. reproductive arc how frame hope revenue year presents patient by that care, the the thinking there opportunity of arc, that it's that's, also can that and deliver that it start from the are -- multiple value full arc great by of we demonstrating datasets paid or we the care or for. arc the finish, get we hope we're add

lot we nor for whole this impact really from it. meaningful guidance, However, I that think a aren't anticipating year's of

of much a we're by is year this kind very sample sample So targeting. ASP,

If And sample of the it. you kind ASP math, around per year. that's this XXX do it's

times is of also for for that of same only That for be are larger we a could absolutely aspirationally we question provide multiple you and revenue next aspirationally interested population patient. that the questions make feature and the data guidance we million expecting we value integrated idea provide sample a population the but larger in in definitely for tests care about the the of next $XXX but could year a same think clinical look at the testing data care, reminder, guidance year, off would create based in the as aspiration as results feature aiming of As family off that we multiple would in until would and in individual where leave part we of lead be are next data the thus family million routinely, samples that the of will results set to example their the ordered answer time same that part the contribution management a the other answering to not be year. the that of for a networks one that January,

current to again be? We've referred to what versus going that's business, just building is you we've that like it that as just industry been it as the actually think -- diagnostic works model. testing extent building to business core the -- were wholesale. into we the will So is core a that I up way in and prelude we using in To the been transforming a percent a as be the it

accordingly. we how map, here's think kind And “discrete” two samples is next and a of per the the to to change year year interesting year kind per the we revenue patient anticipate ordered, of our year, we associated patient this patient, in I patient, would best more something basis next test to how old translated on do year do and revenue be, many three will per that one will, but per lingo so COGS revenue many allocated to revenue

Puneet Souda

that great. front, rep Okay, And that just commercial that if I that's if could the year just the end sort squeeze where on could count I by currently the and you're you have does the in of doing? go gave expansions you one don't of sales in know you terms

Katherine Stueland

Sure.

team of end expect So have and the and large the steady folks be year. about now sales on going that by between pretty XXX the to that's we and working we

Shelly Guyer

would productive wouldn't people volume is really that how of Year. We January we ready the be hire of New do that they the that. you're them to sometimes be fourth this sure do many could year, if are about, end thinking able be this would of at the group that to tail in quarter that But generate expect

Puneet Souda

it. Got

guys. Okay, great, thanks

Operator

Thalmann. Cohen is Ladenburg Your next with from question Jeffrey

open. Your line is

Jeffrey Cohen

Hi, thanks for taking the questions.

little little rate some global. from a seeing out interest of the you're international a Could the little of You I flow a can what bit about of basis. on some you seeing the in you money as accession that there? and know talk payers earlier reimbursement spoke as your bit about talk you're hit about that XX% areas far

quicker are And also perhaps talk about not? some online, than of the coming you or geographies that expected

Sean George

absolutely. Yes,

there. globally and I opens and price one are the thesis ex-U.S. at think our genomics been has we up medicine that certain point, world genomic largely of a

that it's palpable, small world, begun of with excitement we've is our entire business, total the now the amount is clear. after that commercial about demand that's very a to we've but with effort So put the the -- see it's XX% still historically,

same market and with We have we ex-U.S. we capabilities, logistics that ex-U.S. fairly market. the limited serve serving the essentially the infrastructure domestic are

high always the to the our broader is quality panels. world after it's points information are particularly large get kind -- screening, there points that are our epilepsy around we price can So broad at -- I'll emerging our starting put that go offer. is points picture ability the price we panels, hampered our There of carrier price a we have, in to, no in Nonetheless, can developmental with it. the one this

it's we to region all be lot it's over kind that So perhaps not now for are really worth really, tends ever. the of of map. or specific reasons into It a going

Israel, America, Middle kind the East the Latin -- I time kind up of are see of we think it. of it's of have in They as with and really demand. areas more spent into amount picking see of, can all kind time a well. we go we Europe, Northern But lot we equal APAC

reimbursement and question, difficult for We structural not authorities. not worth in spent Central just. reasons, lot It's a to with date, a pointing there have time do answer or do out in China of Japan get it's to European lot your just to the traditional we

-- Historically, priority time, too ramp, for been, it's been it's too us. long a we of much not just it's a it's

-- we make by lower we effort the to fix broaden much, really some to real logistics it to local once think essentially I international, just up to decide continuing start easier get think language support. I after put will much the the menu,

for to little, might a we think, level. think little we around I more the a want addressing the time, emerge But I Over begin clearly government world. at governments picture the

The it. people side can valuable of we probably ex-U.S. we better the will how question price We management can know it, that after We're demand do think this a the on are a for better. points currently and then Just something mark pay. that offer until is and exists for very, going their is to at bullish willing while. do government of that reimbursement we the population I very can

Katherine Stueland

with So that I then we would institutions that began just the really we patient add pay. supplemented over to and how

do And get so, paid partners. upfront for then and we that pharma

big other of the piece So that.

large the just bill you agencies. direct some not that not of when we that So means think governmental institutions, it's and institutions

waiting getting those from not so partners the not Sean directly. And governments we're today patients insurance. as for third and we're pharma We're party said, paid for waiting institutions,

Jeffrey Cohen

available far far be Okay. more avenues that as Would any as territories there or plan in that over? partnership to go efforts paths certain is the that you're as are are other focused made is there deciding -- not as company there aware would

Sean George

a the frankly partnership, there the revenue very lot of our time tests. model set on can't pursued and there possibly around and period plus again [Indiscernible] and XX% past, these was -- just of network the I classic distributor domestically very these are We are aggressively with do know, is global to these sales industry -- We XX% marketing. up go very You margin of around. don't a the highly complex approached spend in we not margin, we distributor kind of a mean gross in distribution

The frankly more around network distribution we to set just margin it demands give. global than up have demands --

But local we support, with absolutely. do bit worth direct up we of I with effort, actually yes cleaning to it's and a the drive little export, exploring can think import partnerships, what think given our language volume is there logistics very, very So etcetera. little of do ability

Jeffrey Cohen

all Thanks from that. That's for it Okay, perfect. me.

Operator

next is question with Bruce from Your Jackson Benchmark.

open. is line Your

Bruce Jackson

question. you thank taking for the Hi,

technology, places your So or in Jungla when with of area? any of or and in terms places did any either look like you portfolio, product capabilities where menu there like therapeutic in Singular you'd are you with fill terms breadth at to

Sean George

is answer yes. short the Yes,

and market we generally the, is host around again, it bit behalf. time actually the in then and here, you are running the little that on the of all the into remember it's the information it's a the think genetic patients' platform aggregating at I place a But us takes turning at of answer. right things pursuing back all single joke the right

is in in additional genetics, therapies we've way think mentioned the be for that done we've there that disease So are, the if there is you measures about patients, management to each very therein. think the I and can of the data preventive that in area, in interesting about what is deployed think

extent that's that add to to kind thing And that to the the on door, envision sample we're comes generating streams of we a technology data those can every that that our in mass stack. taking data looking and

In then profiling cancer, monitoring. tissue by the liquid we've begun working somatic on the subsequently biopsy and for

So we the as diagnosis individual have they that can treatment a diagnosis understand individual, or risk an like with cancer of cancer cancer the for it and progresses. really of monitor

also imagine expression specifically or isn't information I inherited that that or in interested as that other would I maybe genomic but would will kind adding over that exogenous for tumor the somatic management patient genetic factors there, of any be care. is well. imagine profiling, genetic time we

close we're areas pretty I it. the think think to all about disease of to the way is

autism, pharmacogenomics, wasn't now when more of important for think you of that well. is of of Mendelian accumulating healthcare, as becoming when when the think but are now, things is treated previously important areas for kind other like as disease a you think that which But genetics perhaps you is data those emerging areas

management, a in think lead continue patient that's is our the out of mass in probably there think we our we'll scaled it's of outcomes goods manage much capabilities infrastructure deployed and I better is currently being and that and to industry patient And cost really lot good information it. in will to investing enough, -- there

Bruce Jackson

Got very it. you Thank much. right. All

Sean George

right, All thanks.

Operator

closing remarks. D'Angelo now Q&A I'll the back to turn call. any concludes this for period gentlemen, the over for and Ladies Laura it

Laura D'Angelo

you to Thank today. conferences. with you for joining soon upcoming at look us up We catching forward

Operator

concludes This call. today’s conference

now may disconnect. You

Invitae (NVTAQ) 6 Aug 192019 Q2 Earnings call transcript