NTRA - Earnings call transcript Q3 2019

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Operator

Welcome to Natera's 2019 Third Quarter Financial Results Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded today, November 6, 2019.

I would now like to turn the conference call over to Mr. Michael Brophy, Chief Financial Officer. Please go ahead.

Michael Brophy

operator. Thanks, afternoon. Good joining of for call discuss to Thank third our quarter. results our the you conference Also line General Chief Operating and on Bob Officer CEO; the Transplant. and is Steve Solomon Moshkevich, Manager Oncology our of Chapman, Schueren,

conference webcast. live call is Today's broadcast via being

referring at slide presentation be investor.natera.com. to been that will call a of replay A the to also will has posted We investor.natera.com. be available

as that this financial clinical future statements anticipated and products, market for course operating of XXXX; and related dates, opportunities conference and operational expectations such capabilities, regarding product and future events the and will year forward-looking expected release results. call, guidance guidance; During strategies; make financial size; our future partnerships; and including reimbursement performance full for current our for on our various coverage studies; and effects we the assumptions our

results to refer most from currently We the our that recent actual such on filed caution you SEC, Form with and time-to-time that Form or X-K factors differ reflect our press based we today's the us including file and the judgment documents release. could best materially. known with statements XX-Q events to Please

actual those the factors risks to important documents cause statements. These contained from identify that may differ in our forward-looking or and by other results suggested

call statements. replayed made any revise any contain Forward-looking not disclaims is today, update call reviewed or or of information. during may call are accurate during this after the the information today. to statements being made forward-looking current If as obligation Natera the or presented

updates provide a on do not but quarter so forum. or in guidance our guidance unless will on the provide We call, further we will today's performance public during any

represents number growth performance. year-on-year we of a a our reference comparison. noted, otherwise changes quote financial as each or such will We And unless discuss numeric

And call like to now Steve. turn to over I'd the

Steve Chapman

will spoke everyone progress you last us. the business and Mike. for highlights we and our I since in Great, on Solomon financial our oncology additional will in our cover cover thank then recent details afternoon progress progress. joining provide August Mike thanks and Good will and

we go that at mentioned, topic. had will detail will review investor.natera.com. and I into Mike quarter. As a referring just very to each of more were the A then We on successful posted be highlights quick slides

really equity $XX in roughly another put million are for We pleased up XX% as quarter range strong last pre-announced offering versus $XX.X to of This million October. we $XX exceeding in easily represents QX of with revenue year. had the the to part million QX, revenues growth

strong the now. volume up quarter versus of was which XX% QX year on hitting We another XXXX. all represented cylinders roughly we're also feel versus growth last also We had and of like third sequential quarter

development BGI, selling we sequentially additional us collaboration from with prices efforts. our and up allowed in was lower cleared Average in the partnership recognize and to which our COGS volumes quarter. were hurdles revenue additional

many for of were also and year. clinical pleased actively a cancer As from local for significant launch draft now we're colorectal a decision very coverage to receive you planning Medicare next we know,

monitoring partnership market tumor previously. this believe discussed, access signed our develop up Medicine in been with circulating started and entirely opens strides also We've Foundation new an commercialize we to we we assets. in make deal personalized DNA as and to oncology able hadn't to QX that We that

shoe, launches We upcoming Prospera finally a the execute strong commercial total upsized us the very and the which puts we deal our raised a And offering. position so on Signatera. for $XXX green and deal completed executed in to million, successful equity

despite same X% XX% the one quarter year-on-year our half QX first quarters versus Now up test QX with of growth the growth quarter represents consistent let the On year, jump in XXX,XXX me XXXX, more into we've the and growth, last details. our strong in being had. than roughly volume best sequentially process versus

NIPT The between really and was balanced screening. carrier growth

believe much on the set and the are the far QX in line we year. that goals in so are very in XXXX, of momentum track at seeing with overall beginning for continued we We we volume a growth strong

The prices. was next very of see slide when the QX from year. improvement expectations selling of our We covers beginning sequential were QX average pleased to in itself the ahead the

risk opportunity. largely we've As market untapped discussed, average the a remains

unlocking XX% described have revision the is a XX% average-risk and to on key We driver year. we withdrawn As think that NIPT penetrated only guideline to estimate ACOG for is the that we was last previously. market

course timing update be remains but guideline will uncertain. new the We positive, the continue that of believe of to

such In we execution to our ASPs we XX volume authorization average the can policies. In payer an as existing NIPT revenue higher opportunity think fully-covered. drive against requirements and is when average cash continued on million growth, volume we from prior roughly addition believe to through risk performance is without meantime, improve collections there's risk there and reimbursement even unlock cash

so these fronts the we setting a summer fresh in when air of returns encouraging success early on some in we because have our revenue accrual. the having on After caution spring, far, of the been set the initiatives launched and side

want lot a of persist over are to quarters. see today, we yet However, reflected reporting recent the because these in not several the are improvements ASPs we trends

here. feel we have some we momentum good like So

to revenues Medicine, we contributions some a the sense we contributed million reached earned to we our because certainly stripping starting partnerships make BGI valuable financials. in $X.X expect milestones out The revenue about we various partnerships over with unit have give time. And those from partnerships to with this our to from but quarter. with to now continue BGI Just Foundation of work ASPs, a want level like you strategic calculate reminder contribution are these ASPs, a

and reminder a As with out progress replaced partnerships call, our risk that on of like average we pulled essentially the on assumption guide QX the XXXX reimbursement revenue BGI.

playing as largely is out this expected. So

of blended The next slide describes cost our sold progression. goods

over We over from track the we bring year range past posted time. COGS in unit. posted per have unit significant see improvement a which $XXX leaner QX, COGS We per QX last we long made to a track blended are $XXX below COGS to $XXX $XXX progress running As of you reach the year. remain on goal we've is again an can to reducing and this and on slide, our clearly much than record

we've As We described next from wave of in the past. we projects come that in think will XXXX. to savings underway hit the larger expect

I in key our a hitting making of targets. will which to the clear the of described, we to want scale several completion those to just As COGS out line of that increase call projects. in we lab, long-term are QX we investments have infrastructure role play a sight

again, we take Some remain for upfront investments, the conservatively as per higher that QX of will unit in of book set the expenses improvements quarter, track these describe but which in COGS we'll in on we may XXXX. marginally

Okay.

our Now in for let me moment a transplant. effort on touch

be X% chance beginning those and care. with DNA majority described, in meet centers business transplant meaningful penetrated a the our cell-free recently transplant can had One is business. the think today. we in from I've to As the regions. patient overall still to this go we've on a different only estimate are road of a We contributor key as tool of is very about using market stages meetings centers the that, in takeaway

compete So for hard we DNA will meaningful opportunity the a very users. existing see Greenfield we also cell-free and

chart of of future indicative the side right business. from just revenues potential gives this The you range an hand

reasonable you market CMS conservative. current range well the transplants you estimated at next rate, the seven with quarterly could If can pricing – in tests rate the realized years assume of at penetration XX,XXX thereafter then per could and that annual the United in year year well as to per two could achieved see new revenues a proved a year and be States, first be for

we everything before year so we of that a The so slide by since pricing ever now just we hand and on commercial commercial the validation are indicates in hit presentation chart shown know every the last goal. obviously decision don't while launch. We've local same the control milestone is far said the next launch data for those time to on final we're and have previously, that expect timing, coverage announced summer. the track end we our far of awaiting we've our the that and we towards We

We Toronto. of Jonathan a the led from Bromberg of study Maryland registry the University from proactive our second and Dr. University announced Halloran led by by previously Dr. Phil

recruiting look actively sites the with and for are those to forward the we're future. We we in really pleased and studies thus updates far providing interest

progress Now, to our in oncology. over to let discuss recent the me hand call Solomon

Solomon?

Solomon Moshkevich

that into efforts that so primarily at Thanks, look investors our accessible more if of We go in ago. of could easily seen our an a tuned with dives did to for some it. here, have you detail. take page I'm Steve. that haven't investor weeks not into oncology few call but Many detailed detail please that oncology presentation a level same the relations presentation you going our update

we lot Given investors on today. of will the information give summary that have a of I a call newer

on profile Disease The left as biopsy test. based Therapy first match which commercial talk selection, We're is of patient other to of look then focused on the Signatera or typically seen on at therapy tumors a many selection side Residual screening is today slide about reminder test asymptomatic appropriate position. where the Signatera Molecular focused is people therapy and the is and tumor when a MRD tests not are liquid on where genomic in specific a not referring the positioned, to tests also on where of slide. the the genotype. the

however uniquely in estimate cancer a win, suited billion be and of our which setting. core approach efficiency, is we Signatera’s is assessment, roughly with positions personalized market. Signatera’s, indication focus, to and tumor-informed this in well slide, is the technology to middle it think MRD accuracy because We to critical main which the maximizes the monitoring $XX

three within are There this applications key segment.

size of can stratification, risk decisions, the setting. determine and and neoadjuvant MRD adjuvant the patient treatment in First, where better the support recurrence

well recurrence for in testing We're third immunotherapy progress serial how to Second, these than therapy detect And areas. definitive current diagnostic effectiveness making monitoring, working, after my three of earlier meaningful therapy example. each is tools.

three additional to months commercial slide opportunity. revenue. key the even pursuing. offering talked primary was direct a we've When us channels, path channels which we as represents biopharmaceutical using the each clinical opened trials. we're we business we then, sales pharma our companies about are up the near-term significant to to oncology a summarizes generate tool The of pharma oncology for channel, believe Since Signatera In ago, six next for

in we colorectal colorectal now and received building designing cancer. First, scale we is for out colorectal a cancer effort, in addresses needs unmet of Medicare And August. are signature patients. of adoption a indication clinical coverage two the registry population decision team support the in study very commercial clinical large a direct draft for the This cancer to at

Signatera clinical Next is with for trials competing our business for has in a partner with large testing which DNA last has BGI million the opportunity more in clinical and already global approval. China, in did China, than cell-free experience genetic X very FDA BGI and Chinese tests year Genomics.

or large million Signatera very Many XXXX sales pay China X.X and X.X We royalty with all high marketing quality do access consistent a for opportunity represents expect roughly Chinese We a BGI million cancer sales. annually. BGI cancer the cases cancer in imaging. of not will survivors us get these deaths to handle believe market and to launch effort the on and new

it’s blood-based can distribute crucial So like monitoring unmet simple need. Signatera, address to in relatively tool

co-develop results In we're using in leader information as rapidly the and to standard for analyzed FoundationOne Foundation very will monitoring existing the of essay. the tissue ease partners, genomic in patients with profiling pleased product this monitoring CDx partnership of offering Finally, comprehensive Foundation monitoring Medicine. additional the gives announce chance setting. partnership, to CT products we and this partnering Within tissue and QX in this our existing with their by a baseline personalized a to Medicine, biopharm become tumor DNA

just For the I'd our to in uses cancer. intended summarize investors, Medicare two like colorectal newer briefly by proposed

colorectal early is to XX% cancer is CRC early is detection improve if become by of is to known type with detection allowing a eligible recurrence. regional need recurrence cancer relapse local cancer early to relapse Approximately enough. or detected and where XX% outcomes, will the some for curative patients patients unmet first of The surgery

CEA are For serum a and patients imaging five biomarker, this least using reason at today the closely CT of years. combination for monitored

after JAMA over recurrences our most late too appeared. the chance of to can being Oncology are detected relapse result Signatera significant This in majority diagnosed for surgery, today patients Unfortunately, have tools XX.X up cure paper, caught already to with that earlier vast X.X treatment. standard a symptoms XX% to average and cases having more clinical months curative months than is time on lead a In earlier.

improvement physician resolution such direct as with locate reflex as MRI the who a or Furthermore, this CT Signatera contrast higher the PET in scan, just to to with testing was sensitivity to Signatera as shows CEA, level versus positive could rate of scan guided CEA. patient And than in XX% compared setting, a less with For head-to-head for XX%, the XX% testing one-tenth positive meeting serially both comparison CEA, lesion to compared possible. sensitivity soon CEA. imaging, significant of specificity. serially Signatera’s with was and the specificity false patient XX%

workups regard Signatera positive diagnostic is test significantly testing and specificity XX.X%, anxiety XX%. over and test results. of frequency NCCN at timing positive higher unnecessary implying coverage per false Signatera’s Signatera with that with Medicare predictive and even with guidelines for On value the this a for associated was level, a In clinical This could reduce a per surveillance CEA. why proposed matches

The second and chemotherapy to with are patients major surgery. triage surgery Most need after cured CRC regional unmet is patients adjunct alone. for local

So know is physicians that after the objective not. not disease micrometastatic and who could has of still remain who is micrometastatic surgery disease may that and eradicate The in any body. the does to problem now chemotherapy

with many So significantly chemotherapy. patients over-treated are today

In to that need can a treated patients stratify a up status to however benefit to quo, patients who Signatera, surgery lead and getting reduction one. just after more treatment we to it Using patients XX to who significant deescalation. estimate adverse potentially clinical and benefit only instead on one. improves one test three patients efficiency events, unnecessary This Signatera our treatment treatment in treatment of for treating patients candidates benefit to to XX and for are to negative

testing schedule with supporting and LCD, in per which With cancer, getting colorectal high and certain occasional the the This pathway of which slide commercial two in lays year to patients times out risk stage patients. is of times same indicated We certain ahead two the CEA, covers draft first short of frequency Signatera two with roughly launch. years about four interval thereafter. use were year testing three per for in

Overall, we Making tests for receive X million oncology diagnostics policy ever of draft out near oncologists and who a designing we're largest developments, this, represent NCCN we in these believe think trial up specialty direct we'll the Based cancer. indication Medicare. also could We're annually. pool the testing to to described with a channel, a on centers meaningful a colorectal not patients future. registry sales multiple surgeons the treat and begin targeting building enrolling coverage GI

to ramping we is sizeable We'll by which be that effort over decision time a expect a have the time Medicare. expect have and team coverage for about mid-XXXX, to hired final

will channel like for proposed the clinical on While will we tumors. Medicare Signatera of up already in opens support we'd the focused colorectal Ideally, across broadly indications coverage stream solid also indication driving use a commercial space. this coverage, volumes has be effort additional the to steady it of which have decisions, anticipate this in

Mike? Mike to over it hand me walk to through let that, With the financials.

Michael Brophy

Thanks, Solomon.

cross to the our wire and the results key I'm quarter, the focus QX afternoon summarize from quarter this to for the points the going results. the of results on Now

QX mentioned, XX% for million, margins gross Steve Gross development year, cost without the we As we the in points quarter unit XXX were as our efforts year. sold same the $XX.X from in the goods revenues Steve up described, development significant drop were estimate year. are up period benefited last even revenue this the given seeing. last XX% last were versus per We've quarter in with but basis BGI better of margins quarter, versus versus

reference in selling prices average Steve quarter. the

be of consistently total conservative test and variables reserves we events. out and reporting as reminder, labs stripping try metric are in we such by calculate think out we by true-ups a our don't dividing revenues that that to As recurring

Panorama $XX.X if In the in revenues quarter and a million reflected those roughly think the quarter were revenues $XX.X we've the roughly million, quarter beyond. more million, third increase QX that an $X.X in we in third $XX.X and there's last hold, increase seen our to the to for accrual improvement $X.X potential three the for Horizon XXXX, significant quarter XXXX, compared an of million. in million months, see revenue of trends were $XX the of collection metrics, of compared of benefit million. to

order the expenses see for year. million, don't the litigation consistent last increase. think But expected the we've are significantly and expenses quarter permanent the third to we to operating launches contributed did compared Stock-based $XX.X personnel second ongoing Total other operating outside ramp-up charges our with that discussed. planned $XX.X product increase in services related we to expenses were price million compensation that expenses share

$X.X sale incurred million the to Evercord. charge We impairment also related of

to of we quarter. the close $XX.X reported equity the of Pro-forma why Evercord, million cash, equivalents, the of cash expenses, at June remained end and the quarter cash, in lower place offering, for the the this as share The the of loss per shortly the is structure in company operating compared gain addition XXXX. total much XXth, sale is roughly the capital In $XXX held $XXX recent million to from so same which after short-term million investments QX. at restricted

the our to raising and we outlook, revenue million tightening to to are Turning million our guidance feature $XXX year. $XXX for effectively

in described. increase $XXX that related by by the compensation, with largely million expenses expense million which stock-based $XXX along slightly to driven If and XX%. million. share which XX% we quarter, again On would guide to $XXX increasing in a would had price increase On to to from as $XXX have to the some that is been is the we that guiding SG&A, gross now timing I driven come you have we the and legal to to non-cash we're include guided $XXX sold margins, our a to we're to were Evercord, revenue million, XX% million $XXX previously XX%

fewer We have expense year the reduction didn't $XX added burden and more people R&D year this R&D people initially we're $XX teams more to we’re frankly driver than million later We lowering expense XXXX. goals the find We did key that feel another efficiencies some million the and million accomplish but $XX to to calendar during forecasted full year, in we that is of to timing our related. the quite forecast, to $XX be with I million. in had so able

previously to driven $XX Finally, to to down we million burn the change we guiding is in burn cash we million We guide. last sale were $XX in now million in by we event took really for million significantly of million reducing and included from Medicine forecast and and $XX.X are the in in to the are in cash upfront received the million year. upfront cash cash neither Foundation cash and Evercord for $XX that our the burn $XXX was $XX.X

the Horizon. the we're We the May. and note to QX for when will format this purposes, timing the guidance normally we I standard report and that start we and only Horizon out our the combined number the out Panorama unit stick do break then call. since combined next QX for data and of QX public this in a company for XXXX breaking detail. Panorama This level of revenue and continue for XXXX, we plan competitive is will at a make to We'll currently like change QX plans and to number for also reporting

question. open to I'd the Operator? like for Now, line

Operator

and you. Instructions] from Co. Doug first with question Cowen Thank Our Schenkel [Operator comes

Adam Wieschhaus

on Adam Thanks This for taking question. the Wieschhaus Doug. there. for is Hi

guidance Also – Let guide and just can these of you midpoint was licensing your off have Medicine? looks Thanks. QX Mike. through like with does what of What in you in million, emerging contributions like revenues walk it some by guidance for $X.X so update? start you question me us just a that Foundation contemplated from BGI imply for

Michael Brophy

Yes.

so kind don't is they breaking it a why – licensing the The is Adam, teams much it contributed revenue And contribute last function not specifically, that is is that there. deferred I and as working That's quarters. we've quarters. I on the two I'm the anticipate in of the as really last between the have giving recognition flows licensing deals together rec to odds what the – as off but QX, I've the reason some not revenue milestones some and from seen two specific do in rev of that. pronounced two companies in meeting why as anticipate

Adam Wieschhaus

it product commercialization that the What progress be? Okay. in BGI, Thank technical quarter can like some before helpful. On but and specifics with good further you. a detail there? looks And hurdles be would could made said those when know remain you XXXX, any milestones. be more anything I launched Thanks. on you've launch really

Steve Chapman

Steve. this Adam; Thanks, is Yes.

So two that working products is there on. we're

because is opportunity than market one a oncology is times four larger Signatera think Chinese U.S. in China, we I market. the big which is about think very the

serve that clinical run clinical have it those So not enable want China with who in an global but patients, run us only does trial it companies arm in testing also trials to to of to allows China.

So that we think Chinese that's already and advantage a we're signed which arm, that deals we've include excited significant about.

the Signatera specialty So once XXXX. commercialize, set will as it trials And available comes and launch in more on FDA to it then clinical we in will targeted hospitals to centers But broadly. be in approval be initially also think centers. prospective side in, XXXX Chinese we

to we XXXX. we've also the expect includes BGI that the The and Prenatal mentioned, our access on side partnership technology other launch Prenatal in opportunities as to

Adam Wieschhaus

you. Thank

Operator

Thank you.

comes Piper question from Jaffray. Bill next Our with Quirk

Rachel Vatnsdal

for on quarter on Rachel is Congratulations guys. this Hi, Bill.

Michael Brophy

Thank you.

Rachel Vatnsdal

for you talked have yes, for – had you colorectal, talked So colorectal, reimbursement. for guys guys mid-XXXX about

more any defined going timeline a of there that, And MolDx, and of that? talk and salesforce the on the how that? of of is for hiring you ramp update pace than can colorectal you on will then Signatera about for hire guys So off

Steve Chapman

Yes. Thanks, Rachel.

Medicare this open would just so be and MolDx submissions we there's to think actively we second the I the cadence And line our a oncology standard And not forth. period we've on LCD various roughly come said already this meeting for up only to but of think pre-submission of believe that we've on when sort oncology comment and we timeframe. with mean completed sort we're as would sort So, and mentioned in. a previously, our XXXX I – final mid-XXXX LCD, engaged call product. will fronts, also these that of mid

So time really we specialty just largest many in of to coverage that receive pan-cancer decisions as colorectal, draft we in in even really ever see diagnostic Signatera of one test we it's, think future the believe though it's will the a the opportunity coverage, come future. all

we as very as meeting pre-submission second there look that positive submitting and the well had future forward complete we'll update in So a on and the second product that dossier we to investor that we community process. on

As aligned decision hiring limited said coverage on is, the what very the will we far available, it's at we to into building building product a We this that approved, local ramping effort we is think salesforce and that growth as goes, sales be come. have momentum clear up with summer point. commercial plan

and later very to going this over we've off to going trial, it year, announce leaders. top feedback we small opinion which we're expect gotten launching to and start relatively registry our So up good centers scale time. key also be We're from

a So lot of things going very positive on. momentum,

Rachel Vatnsdal

Great. And much think you’ve you over do any? for a do Panorama lower drive XXX, that, years. then the goal is And improvement few get substantial but guys can how last made have COGS, you to to if your

Steve Chapman

Yes.

and then comment. maybe comment I'll So can Mike

all overall which of you the is So COGS, includes the show we products. number different the that

think $XXX that some XXXX. board be business the that that at we of said We lower in think projects $XXX. is place based be have We significantly launching we've our already overall that on the Panorama get we already we'll below currently will that health in reproductive the projects. with ongoing below COGS the across So can down

Michael Brophy

have that’s wouldn't cumbersome. done, I

Operator

Okay.

JPMorgan. will with come Tycho Peterson Our question next from

Eleni Apostolatos

our Eleni on questions. for Hi, thanks. for Tycho. This taking is Thanks

Mike, on you've impact and expecting each the you million you're also seemed by Going of other different but $X practically this to increased midpoint headwind cancel which million, the out. pieces the from can quarter comments back sale You've around Evercord, to your beat by there? million $X guidance. $X about then

million the here piece that consider there to other what $X midpoint? is increase driving is the at So

Michael Brophy

we Well, obviously, expect business that to progress the we core And to continue very grow had actuals year-to-date driving strong – we a continue there. see to do are to ASPs and we QX. the expect to expect

So to And do the core expectations, QX internal revenue short answer expect the as we last expect to growth described and Adam. good quarters the partnerships we I to is relative more strong QX, do recognition two our we've expectations business in from out own our beaten muted QX.

Eleni Apostolatos

That's of then the much cumulative has about tracking terms value, recognized? you in how Okay. contracted helpful. to-date and pharma where can And talk you're been

Michael Brophy

Yes.

we for So beginning year, the we're the of million landed just we at track. we on with well well the like really year, track as but we’re we to of that value of use full just the guys $XX target, where million help in that to frame year, annual of and an feel laid to at of you that's the target that's the contracted it’s beginning out on the terms $XX consistent on for readout QX opportunity – call, that kind what kind said the overall we'll give going

deals In a not you revenue material start samples average you customer, pharma those actually trial you something there's yet, really about, waterfall sign with and a have talked the year actual coming terms recognition as from launch start of takes amount booking where revenue like deal sending of we've the it a here them and recognition, a on revenue to then.

start and and these value that and I is sample from recognize of then prep way revenue that the year things in turns goes generally three deal, the that there's two, about flowing contracted the sign you four. years you the a think into deal, a revenue So into

Eleni Apostolatos

going guidance your how read the range about framework and other lastly, realize of on moving and outcomes? Thank ACOG you pieces given then the are and different but thinking the reimbursement, And XXXX exome, thinking wide you're about you're not give risk yet, I average you early wide-range an Foundation Okay. as to ramps, Signatera catalysts Medicine for Can liquid outcomes us different such be the you. guiding partnerships. BGI, of about for CRISPR how

Steve Chapman

for of timing whether those terms very expect successful get we good in the and the that, we oncology. in not executing think we of really launches we both like We towards you expect feel the on transplant do continued initiatives. is, I look we catalyst weighted progress about are to more kind XXXX or mentioned, and mean, feel core What very, versus all of I Yes, risks in that business have in do the expect do them.

in actuals to we that, color, grounded and kind bottom the numbers do and like QX kind of actuals. those in a actually of why to have reason the terms on you thoughtful think we'd I give putting of of a months that that's guidance of of around guide analysis couple

Eleni Apostolatos

Okay. Thank you.

Operator

you. Thank

Our next Baird. from Catherine Schulte question comes from

Catherine Schulte

guys, thanks the for questions. Hey

given and just QIAGEN changes of there what's if the rest the that's forward First strategy, to your terminated? the shifted being path year, rev-rec any for sequencing expectations that

Steve Chapman

is expected would previously another. it not there small not any revenue recognition to that really XXXX or the Yes, had thanks Catherine, we have always anticipated just QIAGEN quite way one because changes we'd what in been

we what partnership, need we're now. – be need doing that in dialogue just happens we terms In with to with and of the QIAGEN next

share we that So from partner, once we have we'll have feedback with some then you all. resolutions there some and our

Catherine Schulte

a drive or Prospera transplant, then do more you potentially a this from with guys for flip Medicare you commercially as Medicare ramp? start seeing to to revenue Okay. how think quickly soon, final contribution we gradual effective volumes should switch Are you coming think And coverage prepared of could pretty following coverage?

Steve Chapman

Yes, comes we've fully said put in is I we position that shortly to happen a commercialize that after ourselves in the before year. will LCD this to wanted final and think we think what

gradual will also not feel new our this similar physicians feedback that product, we ramp. very we from any the we've in product it so with as remarks. that course, market overall alluded Of only And think, the case, positive on prepared opportunity in about a to gotten always be there's on but the I

discussions having centers. positive initial top have with of proactive our the that also many engaged we're now where we're And study very been the on registry

and you LCD. I can so expect does final time So about shortly think, a overall I we good. it's to collecting start XX very trying launch, receiving after announce we're the looking Medicare days things roughly would It would take appropriately. from before

Catherine Schulte

on readout Okay. confidence data we an your for us reimbursement microdeletions you of time? drive expecting level SMART trial, just should And this over then when better be the what's update can should and that your give

Solomon Moshkevich

the be of done. We readout its been is the prenatal the last it's For SMART Yes, take think arrays trial being sort for beautifully. is baby perspective mean, SMART are mid going testing completed I year. newborn study. a and It's data on this kind. actually questions the groundbreaking the ever largest It's analyzed really been question, specifically done we've on enrollment of microdeletions. that's almost of last the awhile. completed born, will really and it's the been being love study about a along has largest next we'd The And and SMART patient. non-invasive we

So at it move the then multiple the we to and testing. in necessary that's time in think has one opportunity if needle different the aneuploidy ways, in NIPT microdeletion separately

positive seen have and severe they're microdeletion ACMG very disorders So we common and and are groups guidelines like from ISPD. very the

on So move broadly if models included of the needle receive a but contributor. it business. we've would overall, impact to Natera the opportunity have does that even in we've able It's to was upside make described, the coverage be that to better some an not enormous it really something the this enormous necessarily more

our we're a happy very secure were CMS microdeletion for today include we CPT microdeletion unique from orders, testing seeing in the that order So, to test and for to range. pricing about and code XX% secure $XXX of

price, discounted a that very rate a impact. would to very $XXX significant it at So, even make

Catherine Schulte

Thank great. Okay, you.

Operator

Thank you.

Next Alex Nowak question Craig-Hallum. with from comes

Alex Nowak

everyone. afternoon Good Great.

Solomon, are? registry how the primary for patients, how study they long monitored to can it and endpoints be detail many here, what going the are just you out CRC

Solomon Moshkevich

details you the to release question. Thank release planning announced to full – by the for end We're study of of the year. Great. registry the

when early ready. things yet We expect to enrolled And And forward details in we looking XXXX. haven't announced getting details, to the going many we're involved those sites first trial. patient are be have and to we're finalized share those

Alex Nowak

And volume for the Panorama around little Understood. then some XXXX, business, and on Steve, cases XX% a higher Horizon Okay. the been bit for than has growth in just that. prenatal

growth, towards little modulate to growth a back is going you which XXXX probably their maintain that think of probably you growth expect the looking or here, in market the to a bit to is like more You're level do do highest-single-digits.

Steve Chapman

to core strongly Yes, remaining about our and and say supporting market I grow we business feel continuing the would leaders. very

fact, think In XXXX, team that sales that our in about. excited we enhancements different we launching multiple have be we'll is very

Mike, you want guide. do So, to comment specifically more on the

Michael Brophy

we're is the that units terms about to the can just QX way that absolute our of there. call, And because growth on not and think show we think guide in I the performance really I to going do mean,

a for looking of And proxy improvements good can are steady so some We're those Steve has got good – last year. announcing few to forward we’ve do, the we quarters state, what next to. that alluded a these

Alex Nowak

then you major had impacting bit or couple last happening prior years, we in Okay, should there authorizations of the had year, the understood. here kind And of CPT this over you coding XXXX? entering the a that sense. little ASPs obviously of anything is billing Makes aware landscape changes be

Michael Brophy

of them. relatively would average to of reimbursement, I things always course paradigm of we there that kind But, of stable mean, there's new a And which of terms evolving in to be other it's big risk have and and then is XXXX. remained expect, something these new be do we the we execute some steady than incremental against we're through continue often that us and Alex requirements state just against, landscape, the and on put a some execute are new XXXX this are deal. to challenges landscape again, – anticipating incremental that for course, an not shift has the

Steve Chapman

that our year, call. made of were into ASP. proactive are I really on are baked said yet that this the a changes Mike mean lot What we seeing not where the we – improvements the

And in so when way of of we're we it some by conservative, future. and fact really see do that we the that we process the nature do that the our accrual just the

the actually forward we this that made to think from looking improvements we're some there's we've upside that So year.

Alex Nowak

Okay. Understood. Good to hear and congrats on good results.

Operator

no Thank I closing like the this you. queue for further back turn at call would the questions any to showing now remarks. I'm over management time. in to

Steve Chapman

quarter look another and thanking everyone touch. the we in forward us and to successful for Just call for being

Operator

today's gentlemen, for you Thank call. participation. your conference and concludes this ladies Well

You may now disconnect.

Natera (NTRA) 6 Nov 192019 Q3 Earnings call transcript