NVTA - Earnings call transcript Q4 2020

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Operator

Ladies and gentlemen, thank you for standing by and welcome to Invitae's Fourth Quarter and Full Year 2020 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions] I would now like to hand the conference over to your speaker today, Laura D'Angelo. Thank you. ahead. go Please,

Laura D'Angelo

and us operator, earnings everyone. you Thank Thank our good fourth joining for XXXX quarter for you, afternoon, and call. year-end

Guyer, our today our our us Sean our Officer. Shelly CFO; Joining Chief Commercial Ken and COO; are Knight Katherine Stueland CEO; George,

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

Securities one, share as the hereof. non-GAAP applicable; consider business amortization GAAP, United adjustments fair assets; value of and benefit. this with exclude, revenue, liabilities; our the in with Statements assumes, bonus for differ provisions on timing services measures. operations, of is results, expense, predict various titled from expense, two, accurately Principles actual as could measures related constitute Before compensation; acquisitions, the Factors Safe therefore, conclude to market which to cost combination; date and to difficult in our future gross supplement and company We we call of slide don't we our to future to intangible that stated review our of the section to acquisition-related differ grants like in statements the not any integrate acceleration and including monitor particular, other income connection five, our and and Accepted well that, financial research acquired businesses for demand restructurings we things, factors profit, general consolidated and and that to acquisition-related operating including that non-GAAP or It certain settlements. Act. that stock-based you income selling to focus prepared additional assets development, on Litigation several services this our begin, In our and outlook. cause Generally additional plans With tax earnings from investments, make Sean. Risk refer in net, materially and actual period, we and legal and expense release infrastructure within These the the statements of acquisition-related the company's marketing and results States, the to GAAP to in you historical, as business remind To as and loss equity or products, accordance opportunities, Reform materially our among include; information burn. and to you are manage and net reimbursement cash We administrative, of encourage net or demand our and statements non-GAAP turn strategy, most the could other the in per call results XX-Q, speak the four, deck. on our remarks performance future we that our our Harbor thereof, Private over for recent and only will Accounting our financial investment reconciliations, our three, I'd those loss our are post-combination expectations. prospects, business our of of meaning forward-looking I about and available current in the plans acquire, the We forward-looking payments services product pipeline operating press

Sean George

use steadily trajectory. quarter a pre-pandemic surpassing returning in even how thought lot and time for as indicating we'll we of to an Thanks, metrics talk had I results to hope call as headed and afternoon, everyone. QX that introduce It's Having our COO, Laura, key today's to opportunities for recap to a metrics, will investors would and preliminary we January, was sizable and a our progress. months great analysts. to We've the get active where growth our to we we performance and us good with accelerate to into and excited all and with few announced of Knight, be our also We find you'll we market. Ken great look as track the there our ahead. strategy reiterate growth scaling prospectus use XXXX, are we're on are

financial do us that, walk and and year Shelly? Shelly quarterly will full for results Before through QX the XXXX. outlook we

Shelly Guyer

before note you, we begin. Thank Sean. quick A

still All preliminary change expect our which of month XX-K, and be subject are until we we end. to our to numbers file before

metric we scales, generated evolves by number. relevant has approximately which year-over-year. generated $XXX.X In strong marginally quarter, we revenue growth XX% revenue the million, pre-announced our the our business. most $XXX.X a measure of the above million, of As the we and success become fourth business XXXX, In representing

was of the due year. All this throughout accomplished the significant facing headwinds despite to pandemic

statements. closed to seven Slide deal, Archer Invitae XX-K, to legacy line footnotes will the disaggregate mapping we've within statement that the revenue the to In presented Now is streams how in into a the revenue categories. includes the it's financial additional our important we understand ArcherDX items. financial individual of our revenue some

institutions. biopharma instance, or from to other business-to-business For our used which partner BXB bucketed one be both of in revenue category out customer breaking revenue, called

customer ArcherDX, coming and partner other and hospitals percentage revenue. remainder in mix is The BXB medical customers. from and to also through they other payers and decentralized biopharma biopharma payers the BXB out almost will either primarily centralized other reactions where with are revenue third-party XXXX, and at of came the be XX% biopharma by from or a consisting of third-party shipment of partners centers through generated our decrease from partners entirely from our In revenue patients. BXB breaking XX% We lab customers, by driven revenues the

and hereditary our Excluding payer higher with test. improvement revenue and to Archer, NIPS due largely third-party remains performance, payer commercial in particularly third-party our strong cancer Medicare steady payments

This for offerings. notable stronger associated and we and from to the a of products. Archer and the in by that, Archer an to NIPS Apps patients healthy XXXX, with partners ASPs lower due stratified RUO third-party our in another as biopharma The time increase Note hereditary Our clinical payers ASPs, reimbursement benefit of increase products years. third-party from launch in increase increase from expect $XXX by we of third decreased was regulated payers our the and the a rising quarters to and quarter PCM, from leverage. driven our ASP driven to quarter-over-quarter shift in cancer to source $XXX, progress over primarily mix ASP primarily experienced ASPs by coming represents in testing $XXX. with a payer payers and

access the payer bearing adoption ahead to of many curve Our fruit. to patients platform investments is willingness in early our and provide

to Archer we As last the the volume has our important in of in about Archer. more relevant approximately develops become we billable test regarding That period. We're growth future, business continued about legacy moving metric levels XXX,XXX quarter. mix as forward. fourth year, third we quarter, clinical that the our while mentioned tests the remained legacy caution plan billable including on to an in XXXX our given pleased volume from business, could defined that term. an and X, interchangeably the definition tests face reactions to not perform test XXXX. longer billable said, benchmark customers. and continue slide product growth quarter. volume the Slide In the and the base some internationally This previous compared the expected number units set billable and breaks based by out increased includes as of individual to revenue quarter breaks as in in and of XX% exceeded accrue reports by the used pre-COVID test since with term defined volume. we Invitae in units volume reflect NGS to volume billable XX% our next affect will Overall, fourth still report XX% a by of across ArcherDX XXX,XXX as of by trend We reagents shipped. quarters, with break a the measured International volume driven Archer total in ArcherDX business down the out also our the volume of released over customized COVID-XX volume test urge as the of growth impacts back which volume to volume associated current the billable our use individual forward, all in the pandemic our in as and offerings, of for to going during report Historically, topped international our quarter. reports The fourth longer strength of billable business we XXXX, no our they year was reactions couple consistent no accession reagents volume near

non-GAAP providing it for P&L by detailed reconciliation allow of make noted comparison in at metrics. the the of numbers, to and understand on tables prior our today's items the and business the the activity line factors we've sets financials M&A are pace included and in by slide As of of easier to review the non-GAAP Most affected acquisition-related we deck. charges. the and press investors quarters, other release, back two to To urge

call, including business of cash a the more depiction of remainder For which operating relevant discuss burn we'll the the non-GAAP dynamics. we provide numbers believe

with mix unit is impacted quarter per in cost by the we and fourth of run our changes health units $XXX per now to the in expect of billable XXXX the continue now The revenue the number reproductive benefit. COGS non-GAAP defined that in-house total $XXX unit Our and will cost was was divided in by quarter. test our cost

beneficial Archer, test. $XXX gross $XXX.X quarter. in per quarter. of quarter, The a XXXX XXXX have and million fourth would unit $XX.X average in non-GAAP the impact cost in translates non-GAAP XX% Archer the gross a XX% fourth and the fourth per to which COGS our profit on Excluding was during in COGS margin the million A been have

Our impact our to margin. mix gross continues

quarters, NIPS goal XXXX. COGS several acquisition increased gross in announced gross the next goal XX% the collection margin in when and on set a margin target the that we of our again is over XX% stated our margins mid-XXXX, midterm XX%, With our approach rate Recall, and the between Archer. decreased of should

contributed COVID, expense. in did business. spring by Moving operating full was in The response noted We our $XX.X operating which million time the the XXXX the fourth in to cost exited fourth of year. in excludes expense to and million reduce operating so Archer million we We Non-GAAP expense. would $XXX.X burn revenue $XXX.X the to in a of base which activity, we quarter contained the period quarter. that our

have $XXX.X quarter. But expense were transaction of to operating would costs been activity fourth early the the if was the costs, $XX.X million. by reducing $XXX.X quarter business, takes fourth in of the out acquisition the pandemic. in succeeded third one OpEx the this million and goal million quarter acquisition the We quarter. we in in compared Excluding third set the down spend in base our versus our OpEx for quarter days in ArcherDX spend fourth year-end the a Included

Given ideas comment the in including more such prudent and that make grow, continue and Codex M&A markets last as continue and detail. we'll us stabilization will front just assessing, Ken worth Sean of of to opportunities acquisitions, One transaction in the investments programs our projects, that week. in to multiple on

In base Recall associated as expenses. would acquisitions, for business. the was OpEx we and our $XX.X million to $XX.X amount Cash million that finance will ArcherDX in million. invest primarily burn the fund and the fourth million. costs in been burn the increase that expect burn acquisitions to first to we This the million including includes close addition quarter for the cash $XX.X $XX.X comparable in marketing. continue for all in base the XXXX quarter Without acquisition of business these have paid was and quarter $XXX.X and R&D

the our shows we fourth burn quarter. dropped as operating This titrate conditions the million spend ability again by market by over So require. to $XX

XX. cash Moving million marketable $XXX.X December equivalents, $XXX cash XX, at to cash securities, September compared position. our Cash, million restricted to totaled and at

January our more raised Importantly, additional the acquisition this million. proceeds on than guidance. and And additional basis an finance of in equity net $XXX $XXX debt Archer close, revenue. million have In year, to took fourth of down the in we cash forma we quarter equity maintain of we million offering. guidance and to over issued pro ATM. we our during raised XXXX Thus We via $XXX of a in January nearly that

I'll call Now the Sean. over turn to back

Sean George

business, and we expect on trajectory to many we for Thanks, Shelly. included continues expand tackling day-to-day year of information could which the fully few a come. for Last we to a us years maintain demand Global high-growth obviously to the have anticipated. executed provide challenges

and platform series technologies We to grow will also new continue addressable allow propel into growth. transformational undertook services a more that and our of We us menu, that markets increase integrated our to investments quickly. to

investment service picture Their technology One microbial of Our of in with growing years leading acquisition the Their databases and and laboratories genomics. now. provide growing Codex, algorithms and performing labs, most examples. developing biotherapeutics field infectious complex been of curated provider watching advanced clinical biotechnology metagenomic We've academic the microbiome the space accurate diagnostics. a customers disease include recent is companies, interest most the top for several the live

on patients As Codex One it this take developed work to for talent, deep been another Invitae platform. work is engine. and genomic clinicians the projects their and years our knowledge augment One technology making area working action. the their get use team element domain another add assess It's can immediately in can delighted and research in We've how Codex and tool the to incorporating yet been appreciation to and own into on to with welcome growth we're important industry-leading a great health our technology and to to

to to the on you milestone scaling operational important company. industry. investments, And pace that why He We've becomes growing come important organizational for where trade-offs technology and as than brings our continue ecosystem. to Amazon's most for in global of That's we scale comes at our early recognize We including hire with operations any coming led from contribution and the scale, share And more companies, various own on with our M&A lessons need which complexity. him strategic last services, transportation experience will deep including required the resources. defense capitalize operations. continued and platform Amazon, he the tell the do pace higher thereafter. of us And for shift challenges as Knight, new development the then, global to As to Invitae services, that as activity. made internalized global our his an help us of genetics fulfillment plane us fair than more vital first-mover infrastructure, something akin board hundreds as to Ken and of capture will to required be, delivery was Ken year allowing manufacturing backbone, technology engineering, a other sign, years. well, in delivery is Bringing the operations an recently COO human and wins.

it and larger to ever will minutes I consumer-directed while markets, few As to consistent share Ken's impressions. will over take expertise returns. how invaluable. Ken, outlook Ken? to we And move first scale, to a into more and growth be on, now financial turn an continue we delivering

Ken Knight

It's Thank you, call today. the with you, Sean. on to be here great all of

leader relevant Invitae's As familiar me. philosophy Amazon, are both flywheel a model to at former and and

effect, reach flywheel to strategy on a centers to billions, growth. drive self-propelling Our creating

and ways for to mission impact me During to have our everyone with my new serve quality I to delivery time healthcare, Invitae customer delivery. the it at unwavering find of and It the that hope Amazon, attracted the commitment in CEO could mile job the to customers. from the an associate, innovate was the to and last was to scale that

we a unique and information have was again, board, getting business, still traditional so new since I've pleased and formative envisioned. out the task. have Sean Building enormous the execute this needed see past Our do we words, of to is seven we them, goal necessary testing you to of months When need the value of is been that historic ability exciting, right. scale it and an came customers. significantly first playbook, period. made its capabilities and from new out bold and can And way have every me And on getting short platform, these our require a sharper. aspirations to many at mission as customers been part technology-enabled succeed will standard to The differs our clear to I of firsthand, to that in services doing of health differentiates focus decades. that healthcare to then the In the have routine other age as as genetic against over-and-over I The delivering experienced our throw on way serve imagine. models our

think scaling support notable strength see for some our about applies, how build to to growth. I the operations As And I on. strategy us

We First, to we answers have cost. industry-leading our low science and accurate patients provide base technology. is and quickly at formidable. our knowledge And

technology or than, focus Second, and and attributes improve will the is finally, that have flexibility, people bigger big Invitae operating a we also And scale. ourselves. leverage. purpose our for cost several have areas believe of of mission immediate and effectiveness in aspirations. our historic There that are attention. are have The basis core And

central the the providing business, answers to to able for define and metrics leverage, provide our time plan. are flow, customer satisfaction how growth. of is And for providers refining outputs key by volume and support provide and others to is result path, clarity patients, clients not the to and our growth Now for Defining win, urgency we that Cash willing ongoing decision-making to action. impressive inputs. and operating scale three-to-five-year are are or managing

are process driving value delivering cost inputs. Speeding essential now the those and cash revenue up generation. landing to We is key of

We and payoff see of effectiveness, in which reduction, drive have we dedicated faster to, COGS product and teams operational delivery enhancements. invested

to and to money, bound, All time, of so we finite of my our well. them objectives need have we recognize use are time a energy

on bets. mean, placing does not big Focusing cost we avoid

wrong, never too aiming to low. we more be wrong, but or being means often have too we moving right than slowly are We either are

and customers and that will us. our predict large ability by for by came that a not accident. all happen, operating I'm and generate it's I'll to but is for today here to coming precisely I sticky flow call back excited our platform by both a over working be for prepared to future. our do fueled is our part turn goal health I'm now the for when transforming and to will cash Our is sustainable just care and that. present to of I'm be energized Sean. not of

Sean George

long sees you, view is discussed genetic that into mainstream Thank The a future Ken. we've driving as reality. medicine information coming

build of genetic experience unique the across to place single information customer's the stages the time platform care. right Our all reorganizing in is health at deliver as strategy life in essentially we right the

extend innovation. Invitae to to continue that platform constant people turn up for and are operator the march health right over with the investments world. it leadership to the services for around will lining in ongoing is information of We Q&A. menu and billions utilize small big moves improve our its to I'll the with genetic now that, call And With care

Operator

[Operator Doug Instructions] is Our first from Cowen. question with Schenkel

is Your line open.

Doug Schenkel

thank everybody you for questions. good Hey, my afternoon and taking

existing used number products those finally monitoring MRD for just you by products. it's Natera MRD the opportunity The now. kit and place getting really in big MRD into kit this by -- that What the are plans such do as are is are could on is that first plan, extent you? and updates PCM planned on can launch? the of of topic for launching companies codes central bringing provide in the the running part just To piggybacked there actually and midst there? for are launched then it that timing monitoring. are the a What of any believe or of the you But be And a lab Signatera

huge hand one So, underpenetrated you TAM. an that a could it's make argument a sense on

least hand crowded the On little at to be getting this bit is a liquid other biopsies. within more

few over years anticipate would I'm differentiating? wondering you the just So, how next

Sean George

Doug. Thanks Sure. Yes.

details the think launches. the on I So,

So, some now -- using setting them pharma there in are an translational today. are kits actually customers and the customers

ins that for LVT We've to the lines. submission FDA directly our We're sometime submission time accomplish year and a looking as up The and kind course are both then this there's better the LVT would year sometime on handful The clinical kits which PCM next. on we'll that's time early again of so service of the time line call which at So, the regulated we that product current still kind in that outs are offering but PCM we're those on to is as concerned. oncologists but going I an that get products this customers of track running. and will the right? the to for certainly -- standing and submission are happen launch for we the lines kits far stand kits previous got sooner up. as I'm But of

of the see For -- a globe you at all -- million the the the yes countries of opportunity. huge let's are around cancer. XX XX question market battling I least patients next the serve in in the million-odd huge, mean one on It's players there's there's versus it the size that

ever how them to All monitor treated for want of changes get to to recurrence therapies increasingly going are targeted ever. that's than going people with and earlier working and are see

it do So, say. while there's think would I market all the one of them really of I say the that in more at was. great of it's to with room. better fair thing it kind than of I Frankly, general. think it's the crowded are tests for players kind in That's more awful lot an

is to here by into a think treating this the oncologists And of a that differentiates I much sense importantly sensitivity muster anticipating ease with cancer. to There's -- non-invasive into that that in specificity the have long-held accuracy a goods up screening. be again is of pass all is which handful I kind players pretty going are come view the energy of adoption people of patients to space be then general to good have are renal most we going the play. these that and rest then determined I going like things think going think the care. for the that's be be as talking -- of what coming the use view easier this going there entire have is a going precise to select possible levels say to ultimately of going market actually to to offering you're to cancers make compelling the the patient specific it. and our patient what back when to rest that's nature what of many it addressable best versus to easier ultimately differentiates about cases guide ability for early and use very oncologists speed where information be to And service to trying able of the the really actually the be might in use Not useful we've or I obviously coming you'll ultimately, all healthy aren't of market, everybody next therapy the kind therapy this to virtue battling by are stratify parts anywhere determine is. easier

it's So put view not I think one also be way TAM by homogenous lightly. to is going our the uniform it to

agnostic more same. skipped that think people that I exact going family many way is coding -- is this the I past. we the receiving And think and same under it are building seeing pretty yes, that's genes mean NCDs codes -- I So approach. -- the billing number methodologies that's think, and now thought kind way the of the the the most the written with company/test about and will in then I we've apparently -- I one. Again, and be that way Yes. of likely and the it's or and And companies size the of sorry, consistent view at approaching around indeed of been describe have are the thing think the the CMS codes yes the many, coming this

Doug Schenkel

the seemed The remain the partnership reconcile we was part vision more be kits. central to about optimizing in should these bit, PacBio I'm a to extent diagnostics how but quick you. lab. the one. for committed very of bite a Archer with And the decentralize observations? sign one to to long-term your know on And a The could motivated oversimplifying Okay. that think these you'll in importantly, events Thank desire I acquisition you you That's this market? great. by context

Sean George

I in is I kind running what a the engine scale just the mind would is a only within at doing say let's production test cost and specific of And of the Absolutely. Yes. lab keep and think difference Kettering and whatnot. matter between --

it's very the that and for the and as that is we the don't in applicable kit we So standing decentralized testing. that that technology and Archer slow then a highly a the to ability down team as have applicable kind production was well a these that pipeline and at bringing purchased of clinicians both knowledge, offer catering to world places to that of a domain plant at high clearinghouse the can take a up service machine throughput local up as customers and scaled --

kind there. important draw I So just know-how. of that a want what's technology people to is distinction The to

think met Now has patient got something be in to to is where needs out. the oncology that we still time some work

I from and of probably estimates seen centralized the the of think to everything centralized from is XX% there's you've XX% in kind anywhere of market is market between.

way. good three I will let's think we've been be a to five either of XX-XX years pretty consistent saying, just assume kind for

For and run, locally. want raw sheer cancer the new and globe the the will -- always are cancer run economies and more. world-leading develops centralized there content be centers adding the constitute that portion as kind samples institutes the market just continue not are as national own of market what of and scale to out of some even approach places their the to again their send to run important for approach data the to going certain long in around even or push own that And that going

other, in to out. cancer get that three healthy place important which for million going kind operating time It's sooner on And that to we kind these call that five-year on market place is they the think need kind that So mix frame structure think information to -- and I that's that's it informs to it later, be to ins be some be period an run whether of our it basis And in again, that. in could as four they're way send exact of we is patients a indifferent will served. is be going in-house they're the really five whether of it patient help view of access our and at this why a again or will period aim talk why view but it's profit the years. wherever our would of time unit or goal different in per to about thinking to outs might one the to end go a of it time, the that

Doug Schenkel

very you right. That's All Sean. great Thank much.

Sean George

Sure. Thanks, Doug.

Operator

question with is next Peterson JPMorgan. from Our Tycho

Your line is open.

Tycho Peterson

couple on follow-ups thanks. of A Hey, there Archer.

designation? about kind you to MCIT through of the device could think the have, and rule? we breakthrough Could PCM As have that potential Medicare coverage accelerate

Sean George

we it a can. and new-ish do for think We a lot people. It's Yes. of of kind

really So exactly with of means definitely will certainly working and say the But, it's we're that. an important what and reimbursement hard pathway on look an FDA -- exactly is that kind the like. that nonetheless, what important to

Tycho Peterson

what what I'm as actually model are whether the quick. It's need the curious ready front constantly development bring market is I side out is efficient. think just hospitals we kitting to do to on the on And you in send the mean, we this in-house? about field hear

to results. interpret easy get You

want drive do what once reimbursement beyond a adoption decentralized So to to the -- kit? really you needs like think happen you do

Sean George

Yeah.

all adding the for then be kit and price, and be the fewer I to comprehensive, to been ultimately think And easy our has and interpretation, cost push to this makes room have any these shorter, as those it to designs the apply that want data validation then type of as are It's way plus much comes in might working that accurate, as places relatively the know to I do as places it matters pretty to those it's the a -- to of be has do -- much way then And, and are samples to come really the course, with of And that and temperature said, it's to then economics turn And and opposed feature all-in-one established it's on if easy a to value-add requisite to FDA-approved to Archer possible pricing regardless of is again locally otherwise iteration your as have they're those in for stand have can. one the of everything it's if use. has you the ease you're order, And with really the the help very of turn around stand it's be and some include for kid and is therapy of than indicated product team's easy they that infrastructure of can for around therapy of been has on places to every to virtue also then much work it's that be clear by the or they to -- price can we kind along much reimbursement. answers high available best put that use economics by up decision-making different kind where much And other about I rest box data players think put think because infrastructure by to it patient validate. to as have work, he up easier it that ability has I would to The if very be reporting, that to subscribe the a has approved inventory, selection all easiest And one streamlined economics -- themselves. that the like have going apply vary of be that natural think hands that's those going to But box of centralized it one then, in same involved. the have for more easier -- of that as look those want single of dramatically it to for of you this do then players fastest stratified we the be easy use. itself, view a that well. the also course, own, way the easy patient again The for to the to work. Invitae other. it to a run very effective. would of patient. history there with to be as factors the will And run experience the and different -- is our can approach. an view need

Tycho Peterson

PacBio. on follow-up a then And

What deal curious And of, at players forward? development that kind the plus, You, the of, the about looked technology? a moving comfort came the a to decision what on are a you they then never be announced guess, going instrument at to We how had the them incubating. that. deal I right it together. in you got as conference. technology that our There subsidize follow-up are that was kind talked really obviously, got that to landscape, of one market I've third-gen got I'm, range sequencing the changing right dozen as companies is opposed you with quickly. And comfort

Sean George

Sure thing. Yeah.

there of So definitely path-to-market. interesting newer in are real technologies a quick -- players burgeoning with landscape it's

distinction indications of couple is particularly is another right? time. But It yield. a I to pediatric been has important I maybe around these long PacBio reads One mind the very thing of to XX-plus things. with -- think keep a diagnostic also a there's proven some lead and in is think percent PacBio in long increase a does

of the So in when assay lot RFP PacBio company was of development our was a fact leadership developed. [ph] at

it been around been know So with well It's we familiar It's its time. long through paces. it. a very put

ahead also as risk. very, the technology is capital energy we so asked simply view function and, opportunity kind a some ourselves to when has us we there's certain price opposed which is where then could there, very a a -- purely manage someone written got real that is what what think re-genomes those specification for it it, had of of over right in It I to, not by is of play we And pretty didn't us idea. kind together over a it. with genetics if get-go and what venture being a sample basically of, capital, that as time. head was venture got staying thing engineering. investment curve of, close a was who as virtue of them was years those direction important much came long full Once the a some it space enable decided of to exciting tool many the a happens them do. give that a up was volume We're be when to time to to re-genome kind steam will an here. it seen where of question, really on of high-quality firm. a course take that take like-minded And possible kind as effort behind we long we've and staple focused pretty possible. again And comfort and to a engineering that's around approach and go A not our And in very a presented long this We're medical technology after Christian sheer to to

Tycho Peterson

over the hurdle what And, up you side does there? open to how I mean I get market take other of payers it guess, for are going genome whole the is it sequencing? the clinical-grade to

Sean George

test the the thought. on and to that doing exomes $X,XXX than in say, very we're It's would reimbursement better I'd healthy. of PK The I and $X,XXX pediatric is for space kind per range. actually have even perhaps

that's So happening.

I familiar see see be on in is that's are -- been coming a obvious. with reimbursement path of what three when to people Now going that's disease. years think But the lot a data two criteria will is smaller than year very our the next that we've still that the to

certainly amount part those whom also be developmental of -- that fair that pharmaceutical to is outcome of going partners forward. have important the We -- super And therapies. who picture for for biopharma for reimbursement is going a a do targeted

play. all And think -- healthier from our have at affordable of, kind pay explain price I is that's again patient forward. a Having well mix families this that think, like place of piece it. that's, like But said do and probably of, another three as We is it that I I as going could on As not all no -- the well panels. it's answers fronts well. kind of accessible positive other this go frankly way is a typical to for perspective. $XXX There's best and who our for model

Tycho Peterson

Okay. Thank you.

Operator

SVB Our next Leerink. Puneet question is Souda from with

is open. line Your

Westley Dupray

This for Hi. Good on Puneet afternoon. today. is Westley

the growth last XX% XX% Just achievable wanted long-term but to gives pro couple forma the of the to I of a our a -- it's for high the there weeks start $XXX from with a mean backdrop Seems about like been target given pandemic side million rate. out now so XX% guide. and year. relatively level

the and So can we the baked XX% longer to upside curious how just in CAGR there can what's bridge see XX% gap we to where term?

Sean George

we've the only above -- fully relevant question. think growth. three given also do in Yes. pointed years this thing No, confidence -- more picture honest, to. we some that's of be years. I'll acknowledge our substantial got means a guide to I means guide this year just And Yes. the I, in our good think work is the over year kind I the two but there's overall But of, If we've come think do more COVID from for next ever-evolving pointing year, And country-by-country that. is the it be cropping next region-by-region we're and or some that's saga. importantly uncertainty This a some on this up still to COVID the whether question it exactly it think and I that in see and around which obviously, still we kind

feel beat -- can adequately last we appropriately feel or around, confident -- kind our from choppy only of of, that the our few uncertainty we meet year the Also few position with raise, recent been impactful uncertainty opening at be is so or we've say in In have weeks circumspect weeks we of COVID. would still I solidified XXX or have mind, And the potential whether since largely kind is revenue. it still top the our active of that the it's on guide. talking

is then if look So up biggest happening. right clears impact asking sooner upside some goes like the of sooner single tell kind If it that later uncertainty that the not does now the that you it thing terms operates. is and than I happens would of there's in if away COVID later world you're

market -- on as urology of our traction kind clinicians and our new thinking we've of example areas, course, with new example at that. an the looking about of the clinical talking traction that, of whole for -- outside particularly, Now the efforts direct an been

think course the we could rapidly we're lot particularly US part upside. US. we very pent-up see really again, some medical It's up And that very I a and of that tough the and women advanced just who -- really more it's last -- And demand low there. strong a with that's of children there's that picking of -- the an to the is obvious, outside great point companies shockingly growing I genetics. in XXXX. it business of ever-increasing then where competitors We still now our it's is outside all getting traction it's think reproductive the think market even percentage still it's having even in are there's afforded insights not Our but are of potential

we areas the upside of on that's to are two swing think those we count aggressive growth And could provide years three over -- to things. some we I see the those where So next that areas in are selection to that year big coming start monitoring two those obviously be really but the the adding years in when cancer story course of therapy in for part a will or affected think two not this we following. then

Westley Dupray

curious the bit to with move a the the each pandemic on I hereditary around we was and currently, think out pre-pandemic can That's longer where reproductive. and portion know inflected can of pre-Archer And But mix of the we that term? I Archer mix Great. of expect expect invite the between just the markets. follow-up to combined resiliency one where and then the shake very know that just XX:XX and little helpful. And legacy I of business

Sean George

to we kind said going doesn't and right fronts. really matter. Yes. great are With that a investing to of just -- way front don't question. it's it it also we a start I'm those just going by think all saying up and No pointing know admit I'm I out, worth it's in across

therapy and we We business for So we'll grow got tends our diseases non-cancer plenty said hereditary reproductive biopharma of years' then cancer by life. pipelines and has three a neurology. keep could of many being continue pharma acceleration of only which in all inherited expanding room then cancer a there's the is that are for for the way Even full reimbursement hereditary. pipelines The it's of out market looking assessment to that line of of business. is no are more grow to serve very, our years. two I We're to of and stages and are the like kind year that, of that in -- three to And served markets in we of globe in a million think next XX% kind We reproductive. again of be see those in market very genetics. around expect oldest we go a to small large pointing XX paid pregnancies out very, certainly as are portion course kind today. health looking or across and trials oncology, the kind of like very, timeframe looking very risk be combination in that With patients therapy monitoring mentioned oncology selection there's of and portion TAM points therapeutics certainly a monitoring. coming the selection And kind very everybody of in for huge clinical of the -- targeted which rare substantial I guidelines running to would building all expand

next a look a could to of healthy those areas. not are don't but It to be said lot in there three go we we of directions, very don't the -- expecting we answer It's years. care. two flip a different growth So are know it's it's dynamic lot all if in going

of look faster see others. of out also one of I much think if mix factors think the areas short efforts the But of just move we'll and yield and I So you ultimately are we to these we most that roughly question. question similar marketing could wouldn't lot determine can see than forward kind that the be selling where and we'll to in the in a near term development much, market will have And see that term.

Shelly Guyer

have begin one business. XX% tough in ways. forward something quarter of test together in Archer diagnostic indicated the of Yes. put XX% a you whether I We to that mention as look piece that sort that reproductive we it's why of these the give consider that different that piece. pegs mention, was all in oncology them Westley it own across but reason piece piece is quarter, this Sean is other the journey the the indicated its quarter is I thing we of you at products it's you cutting we able the diagnostic And old or as to when the some a if and the side of as moving won't platform. a in to did did would do be The as final XX% fourth I disaggregate the we fourth Shelly. the But XX% collections of very fourth obviously I like other then the those on rebound thing oncology And the that would in some of ASPs would way business see business that, thing, say such. the and the

that by at been earlier that historical we reproductive year-end we still back did And before more the very see rates in growing more had We reproductive although found that old of getting durable. sort were whereas was fast. to year we is the so the

Sean George

look and of daily our I really population thing the long more is that run, And of are genetic in we've group at the at the relevant kind be one the in individuals that to each because kind your at day care genomics there what will the life on I like. it's laid recently buckets our add to that's mix Ultimately of our is last in of kind out -- run having phases just call presentations I'll question age kind life. think of use is of and ultimately mix take -- will of in there answer the number Maybe think couple today the important. each long that the we've

to but that's heads that in think our I two based mix the doesn't we stage where answer much the three the next customers ultimately for of years, five think I an XX-year is question think to on very point the in. injury the your period really into life it platform

Westley Dupray

helpful Very

Sean George

Thank much. you very

Operator

Stanley. Savant with [Operator Tejas Instructions] Our next Morgan is from question

Your line is open.

Unidentified Analyst

on to especially of expect taking platform the early for When to access Edwin to it's guys the is for when the collaboration, the back is gaining sequencing long pretty optimized new Thanks This you a of to long your read Hi. And do question. evolve Invitae. advantages have the solution is your into short do Tejas. Circling first platform clear might system the long of this to early, completed? this running read place? versus stay looking And future, little your utilization read in test volumes? how pricing be expect you how will structure once but preferred access

Sean George

Yes.

not tell answers have going can already best I'm to I do So afraid. I'm I'll can. various the but -- because I

it's together When forward. up are we teams available at And of right right? deal of committee deliverables deciding So technology moving ultimate the or be a iterations I I that will it joint we that's or points. other three hard we think to do two have steering the met is, probably the has few short deliverables be our one making, of long think decision price an still read the the deliverable. think we'll kind different here deliverable coming There's points and see

that. So benefit can not disclosing is of detail cost the a a don't where we're know a of not answer. going deal -- kind be point -- quite something we we're of we at that duration The unfortunately, we're it's the short to

time I number duration it's either think samples. is of a say a what and/or can we it's of or

other up reason way by for medicine. And works -- those with that but the the won't a such. kind the possible we any as discuss. application I that are for involved. millions on that details And drive duration to long short. would compelling sequencing and the learnings, So makes and hopefully I companies But that that, it take it's the both of ability very of relatively out think not what so be it and other think many nonetheless it much get using of it something samples samples, of we're lively luck to read to of running kind as something as volume is to than high PacBio long need Suffice for everyone in a build Because the like market platform read that take course, running. -- there best say of detail the

you the So at how I much aspiration out. displace cost how of play then of look rough long is find increase that's of significant in sample the -- there's the can I when a think diagnostic it will like that much again silhouette mentioned how And together matter just could it's volume going reads. be. to simply out and And a we're that yield

Unidentified Analyst

XXX much can test it think going I more reduction, it. Got think about How guys forward we in your guys expect to here? said and how terms you X mentioned out over you. tests? for earlier cost more a you very health remarks, have side that Thank this then switching in your we can reproductive in-house. I'm helpful. prepared That's guys you And wondering quarter expect? And health reproductive reduction was cost of auto much I

Sean George

Yes.

non-invasive in assisted really handful in-house, kind reduction so carrier also test So of miscarriage terms on PGT screening, other specialty key are tests, PGD, of prenatal analysis, there's of kind a there's for which reproduction. of screening, the there's COGS

not COGS of a need expect we all COGS thing to would no quarter COGS. think kind but -- cost or we quarter jump products, the had it so we as would its have the that an All a biggest It's fastest maybe maybe again of function to consider the step of attacking a in our I continue was XX% brought volume outsourcing reduction of EPS. rest business technology. demonstrable Yes, switch And also single of general now the you in quarter-by-quarter the then savings, which overall of growing of of were we all one -- lowering line, specific one working the kind on COG We the in-house. the there's for on single one running. of -- further cost. over to the if goods of us that those and continue it offering. Certainly different we work NIPS of we in were make the is reproductive we're XX% but decline That's on bulk

entire gross and go. there. that's across target platform So I again, the continue full get a that we confidence room margin there's general, just And think XX% we'll to -- in can to

Unidentified Analyst

Thank Shelly. Okay. maybe one question you. just housekeeping And last quick for

ASP breaking I assuming such think will in as for guys remarks other that's same you metrics, you said right? be and as I'm longer the COGS prepared Archer out volumes. no that Archer well, the

Shelly Guyer

Yes, exactly.

was our what do quarters second Archer since and wanted acquisition documents published, both were for in SXs. as first give and the prior quarter, already fourth we third So you the as to to our all well SX their

been model programs. so, we're last you into time you the but talking, all part, can these as would And we the whatever want integrating complete because thought be our this moving that give year we've so a starting programs forward, in point, you other that of

discrete And to and to so, their and trying what's are for expecting. separate company patients that's it's and platform particular the make our opposed we'll for the business, people on not the best business, decisions a accelerate based as what because

in million is and Sean and saying, this who those XX out, keeping acceptable for can price. we I and the our done into which rapidly test the other So an think the patients it's the rapidly to eye we've sure for that what on affordable business, into we're the every test as whole, get same best how as platform need be patients is was them integrate

Unidentified Analyst

much for Thank guys, got answers. the you, Great, it. very

Operator

Laboratories. Market Capital with Gottlieb Ophir from is question next Our

Your line is open.

Ophir Gottlieb

for XX% you Last year-over-year Hey. few a metric, the there XXXX, this the there And up Thanks report guide preliminary this metrics. so then XX%. Archer? you for Can new Thanks for guys. QX the accounts, taking Thanks. something growth. full excluding and share with new was was accounts, One year was new something metrics rate those year, reorder is like shared other question. which organic like and

Sean George

Yeah.

out It a wasn't a to it offer for I region. reps, get of era, good, would forward the out something I include you, it's I'll of one put on will and to of I'd COVID, those discuss that just discuss depending that look traction most had once a really of field where if our broadly. on real things comparison, something it all and that the where didn't didn't it it what of with it, of at out make that That things important everything COVID It key got thing lot haven't but particularly we continue field of to will sense. lot will alter And the -- not current -- of make kind about as be continue show mess like, kind We going sense kind an of look we But, we it's commercial important publicly. of thing to tell enough talk accounts. as all it we we is with with traction, COVID think -- that of a the something at. will the this

Ophir Gottlieb

Okay.

accounts? mean those vast does growth, in growth the from existing So majority that then that hampered of XXXX was even

Sean George

sporadic the to want also circumspect more were our we telemedicine, bunch us, we stuff newly kind in sticky rationale like new was ChatBot, of some right, score were don't by and market it are do a a fair nearby than point a just ton able versus enough there, and to little a And we actually lot were out toward out off now one accounts, accounts at a come acquired of that's some front-end or or kind of only this about that's it's importantly the reasoning it's to There we means was that and offering is, which that assessment. marker was point. about because but of behind get said, once the experimentation account to We something that -- new interesting Those allotted can I with Are enough kind was that an it's those -- acquire doing I we is to development generally but just how of end of what think the telemedicine. think of that that. they Ophir. could durable? with did with think account that taking I year, same -- action

Ophir Gottlieb

you. thank Okay,

Operator

And over the call turn concludes session. to gentlemen, I'll back the ladies this Laura Q&A and D'Angelo. now

Laura D'Angelo

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

Operator

this gentlemen, today's Ladies does and conclude call. conference

may You disconnect. now

Invitae (NVTAQ) 18 Feb 212020 Q4 Earnings call transcript