DMTK - Earnings call transcript Q4 2020

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

Operator

Ladies and gentlemen, thank you for standing by and welcome to DermTech’s Fourth Quarter 2020 Financial Results Conference Call. At this time, all participants are in a listen-only mode. [Operator Instructions] It is now my pleasure to turn the conference over to Ms. Caroline Corner. Ma’am, please go ahead.

Caroline Corner

operator. you, Thank fourth DermTech’s full XXXX year Welcome quarter call. earnings to and

This forward-looking Dr. today’s relate Kevin historical President Officer. Securities forward-looking Litigation on All the me not of made meaning John statements. within Sun, will are the statements facts call Financial Reform and Joining do Private Officer; on of are Dobak, this to of that include matters Executive and Chief considered XXXX. Act call statements Chief call

call including on change or release this assumptions, are in of future the XX, including XX-Q of Forward-looking described March differ based during statements in such quarter uncertainties, DermTech’s and over factors, statements. projections performance and are DermTech’s results could Form to materially September management’s Several with today, to which such today’s made Actual quarterly described cause risks factors the and press various for as from recent expectations time. ended contribute are that filings those most X, on XXXX, SEC, report differences XXXX. may subject

are Time DermTech’s on A website section latest call DermTech’s the DermTech’s the the in you’re undertakes obligation available X:XX December to fourth any required Relations as the XXXX to to DermTech’s which website financial release or on and Investor for review. available law. these recording will XX, press website review p.m. and the by year filings, on company’s results Also for with DermTech DermTech’s quarter addition, includes SEC In Report XXXX, be filed year ended to to updates today’s statements is except under revisions available Pacific this Form DermTech’s details XX-K be release. you encouraged results. information today. Annual of www.dermtech.com of the additional about update the no by applicable full encouraged are

Now, turn John. I to the to over would like call

John Dobak

We today. join trends delivery in a growth taking occurring everybody It on believe opportunity patch the and method treatment adhesive healthcare unique by our realize genomic time capitalizing accurately genomics Caroline dermatology, revolution conditions. that genomics to information of and of vision biggest us you, that as based Precision the for the DermTech objective is medicine diagnostic disease skin provide and sticker scar-free use an by thank skin our to and a testing. leader to genomics the can you smart dermatology is healthcare. accurate DermTech today, non-invasive precision is in for for of new to even and smart Thank to the to collection presents dermatology. sticker. is and of two and category we provides in-home a health. refer quality skin of variety high on assess democratize precision healthcare The platform Through our we allowing patient enabled access sampling the care skin any is practitioner pain-free dermatologic a

And us these bringing our forefront the us while into be may be the dermatologic care. and into telemedicine. patients’ fundamental home primary with the transformational melanoma is focused today, the to care DermTech while we to platform beyond our takes first problem. we wide at allows product, skin of vision of a on our changes So, dermatologists via range dermatologists address on may focused

stages. improving solve Assay is Lesion diagnostic old curable lead and Our year the in are to when dermatology, because commercial results than unnecessary enhance how the decade’s the is need of or and early the detection surgery. melanoma most X,XXX first melanoma a lives XXX,XXX aggressive form product saved, early diagnosed is Melanoma in more by is of Pigmented deaths the is accuracy detection of and problem approximately cancer Early product, XX% is each the U.S. PLA reducing the skin melanoma which found in to in times

of difficult early diagnostic visual melanoma current both the is and/or melanoma this diagnosis. melanoma the surgical four a U.S. diagnosis, performed extremely to standard, the year early positive leading About falsely to probability pathology diagnose current giving procedures missing million With each in market. represents stage detection are of a incorrect and the high served

market, this our However, only an within exists expanded market. in not opportunity served current but also

immediately earliest assess One is earliest found of be the to ideally opportunities It our technology change. the early the delayed where and may to stage be is of suited precision melanoma would the diagnosis melanoma missed, at be overtime may followed use our photographed provide dermatologist is were typically detection. stages or and in by moles more where melanomas find moles important that these platform for a to

Importantly, actual for of large in as served with not current do the practice of as the biopsy at we or the this typically market market opportunity these We expanded surgical directly dermatologist. expanded be surgical followed moles the may least market, believe biopsies. compete photographed

cancer, alone. skin focus to addition initial products very large address more types pipeline smart a of for than cancer In of in on vertical of we have our most billion sticker melanoma, leveraging of skin products We technology. built genomic robust our market the $XX believe U.S. opportunities our

next six development these in obtaining the significant drivers progress the and products quarter outside distribution test overtime model then of our Our the the in made four of on channels enables the development new and of channel, is XXXX. of drivers coverage securing We channels volume and professional coverage dermatology key additional distribution to options. leveraging of that fourth fundamental business business precision the dermatology dermatology, professional are quarters. volume of products payor in commercial consumer continued to Key launching payor pay commercial by the monetizes and/or of and drive variety adoption

of took we base access We a forward science significant a tests and headwinds. sales a PLA and personnel. consisting inside directors, commercial regional users, professional in approximately our marketing, managers, organization of unique our sales of and build-out record grew step received offices liaisons, now care the XX other we On the to adoption managed dermatology team of despite have number product pandemic component, and of billable limited physician

driver We expand to can team year. as We to to the biomarker, stage delayed total, chain due dermatology our as to adoption melanoma the and a dermatology. for the sensitivity year COVID supply improves detection for recognized our enhanced seek the the launch further the educating PLA as use can we out further in XXXX, the be mutation PLA XX to our of additional was constraints. and Adoption also early plus or of The that melanoma. approximately expand PLA expect well testing managers activating boost PLA encourage quarter beyond plus sales related non-users in sales mutation with believe ads targeting TERT dermatologists this by test test plus key to incorporates other last throughout second-generation product. launch likely patient which of of second adopt The a PLA continue our is to

and strong testing our desire last infection. consumer successful, X,XXX Our to of a interest website continues have accurate doctor digital initiated diagnostic that indicates to our PLA month. very be which X,XXX campaign, generating to year, scarring, each and risk This patient awareness was their a patient in consumer discomfort, searches minimizes more find on

beginning sales strides the to make significant also to beyond expand traditional We’re channel. in-office dermatology

primary around in strategy integrated our establish to care networks. continue We

networks commercial currently to We to – pilot some with commence prominent working are programs.

having and a having care familiarity specialists, poor existing have may access they our dermatology and to that with limited to attributes of target portion their their profiled involving also unique primary allow care genomics Exact having have that sales effort. attributes We of users Sciences or a Cologuard. use practice These found dermatologic through us some with them focused include significant

fit U.S. commissioned We in study profile. recently care a physicians this identify have primary to the that

adoption our of telemedicine our part expand strategy important offering. to improve an is Finally, and

continue lesion solution skin The a the for a our make This then needed. in We for test allow relies technology order review who and to applications. by it catalyzed will on photograph which information streamlined and has patient cloud a our solution, to upload pandemic software a dermatologists, can if to progress are some telemedicine storm and to of we recently technology on effort. the and hired key remote company quarter, we for shift leadership we delivery we offer testing only this fourth in-home capitalize the diagnosis. the development towards telemedicine trend well-suited are that pieces, cancer can we as care health beta believe completed and In

of the strategy. obtaining payors in quarters, we’ll We two Blues commercially expect commercial with contracts our we business California, fourth and of this over solution quarter of coverage announced next solid made second In the the sample XXXX year. plans to expand and volumes Texas. is it large with year, our in several Monetizing our quarter key early and and Illinois progress component this pilot commercial payor to look the fourth growing by

patient Geisinger testing coverage improve a a of the adoption received also We leader policy care. with prominent Health, genomic in to

in these the we recent lives approximately now have successes, the covered With payor U.S. and/or million for PLA. XX contracted

is from world We to stage published also number NCCN developments PPV negative our least cohort and the setting, to XX% PLA-negative predictive identified study to further January the confirmed of economic our that four at cohort new of a that period XXXX, study enhance study XXX top-line deaths prior a value patients confirmed The we In visual XX%. negative standard of addition includes enrollment but our patient disease our alone. tested XX-month with real soon lesions, tested with rate repeat demonstrated of This study our have predictive value full the the indicated TRUST to subjected in completed late positioning a a payors. TRUST at the with of melanoma There evaluations XX.X%. to no than in paper current the NPV, X,XXX the be value identifies lesions to study our development results OptumInsight. in will the predictive a PLA of five This PLA impact in this a that cohort cancer positive XX-month we test or were of testing, study, evidence believe on our of higher results ongoing positive guidelines, the tests. and times of also

of evidence coverage adoption higher-risk Comprehensive PLA Network with look for received current in or a is care. and new care. we that The PLA, the are enhanced developed at Payors cancer like studies lesions recently guidelines. cancer leading these current features standard the three to The pathologic physicians often melanoma XX of it’s of NCCN the centers alliance we credibility to justify combination two managed early publishes the high-quality improvement Adding NCCN offers PLA In a guidelines detection, times demonstrates that to and favorable significant not-for-profit NCCN the inclusion advance have to for the technology. Cancer National that clinical the approximately identifies visual and early melanoma addition, a stage rate over often the standard.

that the are for uniform as technology contracting and and facilitate utilization. will We the consensus as of optimistic payor adoption recommendation coverage, our well use physician

believe with close we completing economic we cost impact with a Lastly, associated are OptumInsight, study will our PLA savings the product. demonstrate to large which

While that there the demonstrate to the test we drive two limitations of years. cost the believe bullet ramp cumulative test savings next evidence, and claims payor is additional melanoma adoption, will three ensures payor educate to payors up develop the a clinical appeals broad on over pathway, ultimately access current no lead effort coverage, diagnostic to silver our denied are

Turning have been our with business cancer of advancements we of now pipeline component to significant skin third strategy, the products. our making

skin. we’ve diseases of compelling inflammatory in the some identified addition, product opportunities In

which and mutations is photo product, We phase Luminate gene normal which completing ultraviolet-related skin skin, our assess cancer to internal are now aging. risk will the in related validation appearing for

of successfully precancerous internal and focus XXXX. think completed in and with years the product with validation over this validation does. changes, detection. genomics last Luminate second is genomic initial the study year what future external we XX in to early big We introduction with study a our is skin has finalize target been quarter quarters of planned, in detection will cancer fourth product If this While this is the an the development for of essentially the as five third

We year product. the customer launched acquisition digital consumer interest to making thus demonstrating that for reasonable progress still in We campaign also cell fourth is cost the the the very the awareness has quarter believe This this also to that on phases. limited in cancer. testing verification product is in by beginning quarter. this assess We far campaign squamous with classifier of be This the completed and been the successful the carcinoma will and product early stage basal product diagnosis a were in validation stage. pilot third of facilitate demand skin in

and up and for samples enroll is and have running, complete end study subjects year. of validation third around to of for the this study clinical the quarter enrollment we Our fully to expect the

therapies. diseases cost some poorly opportunity. patients healthcare costs. as may patients to XXXX, inflammatory the an in we opportunities $XX,XXX the likely These his Depending predict which first targeting still improve areas a on significant Howell may immunologist of LDT. PhD, highly diseases half therapy this genomic as team certain may that that and of to to have create the inflammatory product to response respond Michael opportunity in Dr. of a regarded atopic skin. are the dermatitis XXXX, of several an and care can subtypes are biologic introduction subtype, year. much market Howell, In to $XX,XXX other reduce per patient of Identifying hired certain of therapies, to QX a respond We specializing assessing as and genomic involve identified

of dermatitis million them U.S. and adults with in prevalence the biologic candidates in approximately reported for XX% the making having children moderate-to-severe example, approximately X.X is atopic in therapy. be X% For disease, to patients

generated supported I opportunities proceeds. we and a the focused by offering high-quality stock follow-on of of recently to common have have initiated In by recent We completed all which existing successful markers discussing activities, will and very to $XXX on public to This now been just and genomic brought that a and may atopic January response discussed. will allow was our us offering our predict gross new healthcare in clinical I close identify therapies. relevant million dermatitis XXXX, investors investors. a financing capitalize study

In received gross million. proceeds our $XX financing aggregate in gross approximately addition, equity proceeds of ATM from approximately we million $XXX generating

portion which in of was have million. the $XXX Lastly, million a been has warrants proceeds. cash balance significant our of public $XX outstanding February exercised, at an yielded our approximately end additional XXXX

to to go results. I’d the our financial to turn over Kevin Now, like call over

Kevin Sun

year for to to revenues QX XX% compared compared for of XXXX. to total million million $X.X for total million $X.X $X.X XXXX XX% XXXX. for revenues increased same John. full of Thanks, the XXXX to period million $X.X increased

XXXX. increased Assay XXXX. local coverage determination year billable due to XXXX related and of period XXX% for for million February went final XXX% revenue compared same $X.X Medicare to samples revenue the for for the to increased to that million effective the XXXX, fourth million, higher of sample revenue to assay $X.X recognition XXXX $X.X in million compared quarter volumes full of $X.X to

could to quarter increase. higher be to than from XX% Our meaningfully payor approximately samples the were approximately reported to in X,XXX quarter revenue compared XXXX potential we XXXX; Billable actual for quarter is a volumes. having assay revenue we’re broader fourth XX% that monetize the X,XXX as recognized the X,XXX coverage of for or compared of third continue our billable sequential at and approximately the sample increase

XX,XXX, to to to of compared growth increased the continue year see We quarter due headwinds for see pandemic our fourth to fluctuations for XXXX. approximately XXXX samples the XX% may full XX,XXX for continued XXXX. and more during billable trajectory approximately

education fourth Medicare in of samples same We and with approximately and Medicare. PLA year XXXX. of Medicare to in a of quarter the two make progress billable about with the the increasing XXXX, Medicare the PLA prior in in percentage QX is clinician the about samples awareness during continue X% to population. our of increase patient grew XX% proportion QX covered period continue XX% point increase and compared an the we represented to of awareness the to acceleration quarter. by that during per XXXX XX%

the for melanoma surgical of approximately, reminder, year in population. half Medicare in U.S. are biopsy each the a As performed

sample to remains volumes. monetize So, additional opportunity us our for

approximately in by pandemic. unique in penetrated melanoma visit target who approximately of target dermatology we during a However, current the QX clinicians. clinicians Medicare of about COVID we We of penetrated dermatology growth X,XXX XX% to concentration X,XXX we clinicians and less XX,XXX XXXX, high to in diagnose are dermatologists procedures in total approximately X,XXX compared XXXX. approximately patients to QX QX, the likely approximately of of initial be of QX clinicians, annual since the have impacted could With proportion and of continue to our ordering unique XXX XX% account surgical out market Medicare XXX our believe XXXX market XXX during our ordering in the for had overall

and XX% We are COVID. and pre-pandemic new volumes region sales continue estimate depending sales our both average have in-office month, trajectory unique of increase clinicians sales the of new by reduced the to the by of reps volumes to additions been both affected ordering access ordered tests each impacted clinician clinician are due about only on increase ramp the call for heavily number number to pandemic to even though We clinicians. levels. call by each XX% ordering

understand, million same success, decreased XX% PLA customers, their and be dependent progress, which factors, XXXX. period highly pandemic. have affected variable enrollment the pharmaceutical trial Contract on of including Our for been patient by record to that monthly XXXX other and continued million and to to or clinical X.X month. tests clinician risk continue ordering average clinicians, and and utilization, achieve in XX is compared in minimizes per ordering infection or quarterly ordered billable practice, billable of utilization $X.X revenues ordered QX compared XXXX. samples, new clinicians to increase of near we who the scarring, patient the in accuracy quarter average provides of or QX tests for our QX, discomfort, unique highs X.X the during QX fourth X.X ordering key contract ordering number increase per and along record of to number greater utilization. they samples more continue believe new We was for in with X.X metrics, clinicians, to will of average of $X.X continue efficiency QX revenue XXXX, as to and

the contract with During signed partners worth our we in to partners up trials. those clinical million revenue for $X.X quarter, pharmaceutical agreements to work-related approximately

a for is primarily for XXXX. largely additional in we increased margin to the $X.X period As are despite in the due to same XXXX, XXXX, same to costs fourth gross of sales of of the million increased contract the QX product reduced same quarter million due marketing in fourth by of contract for here and volume administrative the sample sales the loss to for was quarter some development. progress gross R&D primarily expense the including non-cash XXXX, $X.X the of supplies $X.X XXX% QX XX%, laboratory the was shutdown additional potential XXXX continue XX, of XXXX. XXXX, compared of of margin expanding make quarter to million. trial revenue The $X.X that of XXXX. new quarter, assay million unique period the compensation, early same negative the quarter, which XX% margin was costs. polar increased during period QX end spend by country. increase maximum fourth XXXX, challenges decrease July pandemic compensation, awareness compared and General equivalents related to was driven XXXX of our agreements. clinical remaining investment and period included fourth the of cash expense higher of of and period stock-based cash, which XXX% and increase on compensation. had million and PLA. increase $X.X increase for increased $X.X stock-based for development same to was December compared offset loss of due for related the peak securities, million expense event with Gross higher grow higher At to increased $X.X costs for headcount, the $X.X million $X.X to QX million the the for to for of marketing million included to to Research The much costs compared to compared X%. a our higher million net of XXXX. of revenue in our support to over current of to the that this compensation weather primarily quarter was of from team, fourth the vortex to $X.X February COVID and XXXX, XXXX. payroll-related million, Net confident stock-based $X.X quarter in legal million of adoption and we’ll we marketable XXXX, for non-cash of $XX.X totaled fourth the XXXX XX% our

in two growth the utilization PLA We the of are months seeing in year. the continued of first

We start-up And prior there under initiated payor recently related typical, authorization to claims billing and billing been challenges as have our have some contracts. new processing.

revenue issue, to identified are challenging grow, Medicare Thus, recently of this which QX with to We for also working million. claims XXXX revenue $X.X estimate at while adjudication claims in assay it reduced a by and time. results us number growth the resolve we a programming between project to $X.X we paid million is Medicare. somewhat be expect the will

initially is We year affects we formal because the sizing the are force rollout. declining of PLA our to beginning delayed hit case working to sales launch. and we we’re headwinds, our while some providing period full optimistic the to guidance the force COVID pandemic vaccine expansion, are target of at formal proper of uncertainties ramp which about creating numbers enable not ongoing due right the the the and still to revenue sales XXXX sales the still deployment. COVID and get

believe made we are and well are execute We near-term pleased positioned on the opportunities. and current environment we long-term with to have and our progress capitalized in the

back Now, questions. to I’ll call operator the for turn the

Operator

[Operator comes Weinstein of William Instructions] from question the Brian Your line Blair. first from

now is line open. Your

Brian Weinstein

Maybe, could apply prepared in some little say, well because it mentioned let’s I CMS efforts as there, patients start know, on of, XXX. there. kind the kind overview volumes and Hey, but better to as payor our target don’t bit update a guys. ASP, with of even remarks, the in people thanks we we QX just annualize you your an of these question taking solid thanks for private the and for on real down negotiation,

revenue Medicare you base guys of the already at below kind a at are So, million. $XX rate

to revenue ramp you So, have talk can to just patients, where better deal as reimbursement. that in the with about higher you we payors start this going efforts better starting you from trying up CMS pricing as private then your also when to results far might to up understand and see target is anything show

John Dobak

know they XX from Great, thank is our Brian. the to exactly sample I’m when this when it hard about improvement coverage pathway, are which say higher with think test. is policy recognize ago data revenue up have that to are on literally takes typical not We we really pandemic, more did got because the you, and our and process. with that as engaged we you and the almost XX% reviewing major we’re grow We historically that we we month I are activity to we all would really your literally a It’s track evaluate the that went payors package, due they in glad pandemic us coverage Medicare understand seeing aware problems that potential the couldn’t critically are from don’t of. We the back our we and they’re increase our coverage them Medicare thoroughly hit volume know years achieving the we delay our on based even recent hit since control – months that current to two into to ASP. for effect. starting the significantly the will picking much is that now three payors coverage. will provide a dramatic timeline. really But a effort XX with get to believe months

data to there’s the of not there. patients study think the do And to think an and and lot guidelines studied, also publications thousands I do XX of developed. carry NCCN economic challenge process of going we the a They the is And that water so also this impact I with payors. seem education credibility and help have we’ve

talked ASP the this campaign population. increase consumer remarks, I that to to will and is – opening lead actually as applying, is ultimately I access going that Medicare So far do volume. pressure sample broad I the campaign in we monetize general, our targeted think we’re the at payor in to goes, significant Medicare as think, about digital campaign, our and constant

them And and them to so we’re educate trying make aware.

I think just higher feel matched the our to during be payor pandemic. mix have for half. having is it which proportion office what go see more to them and closely free Medicare this We’d biggest biopsies the melanoma, with challenge is into would like for

and utilization so opportunity And an the it’s and will that help Medicare awareness that raise also think we to among everything we’re accelerate grow that ASP doing to population drive there.

Brian Weinstein

X, for Thanks Great. about to utilizing bringing we answering January you may relates in terms here about thinking often? were talk in or changes some it it this those used then and as can changes points some are there start as that. how product economics, And the starting they we may that the or of not about noticed impact of sort thinking more of that

John Dobak

position discussed that revenue kind I taking the directly Sure. concern in to tens and or the about, on biopsy of product some my of calibrate it’s There’s dollars because but to I thousands practice would dollars, is biopsy dermatologist. we’re always we’re not I important not away that opening by of first compete about comment. we’re start think that – dollars. hundreds talking with saying the to really But trying really the there are really here, of reimbursement dollars staged from

approximately commercial Medicare to most maybe, payors the $XX. about payment is for $XX subsequent procedure the and is for sample. The across $XX, common for biopsy So, average payment each biopsy reduced first biopsy the by half about

be surgically mole, biopsies to remember only is the have offset XX% So, loss that by which a by about our to And reimbursement that likely of where those lesions positive, our is excision, a may lesion. back use that that subsequent in differential will revenue revenue to some $XX. potential a on offset are dermatologist and the full that undergo XX% typical use of most going test revenue you tests third. then fact about loss to case a product, will with our to and The it’s atypical that quarter come the going

them hear up, So, product didn’t we some start practice think adopting biopsy their our because they efficiencies practice. billings my are I and users my is the PLA if revenue after change deployed in in much what when high widely revenue that from they do anything, overall get – volume the is my that

going forgoing we just so think melanoma movie or are run better of completely long worth adoption. care is missing And dramatically don’t economic We to the amounts couple don’t just hinder what the really tickets. think notion that a to of the in concerns a that

like we of the product. can in and that adoption feel we still the overcome be So, successful

Brian Weinstein

it. Got

– view So, the you and that change the that was anything how two don’t I make sure just on clear. it wanted really to coding changes

John Dobak

of doctors, think a don’t way I concern – concern not to we so. address to I it’s that and think going I’m it’s a the but working. have

Brian Weinstein

last Yes. me one around And from is the care. then primary

before. You’re you little of kind head addressing on it now than had bit more a

go going Cologuard be obviously you here to it just you’re or about you were you’re You’re in talk to putting going that appropriate the off going to laid be you based for to resources here kind impactful Can and how not about out. specific the resources reps could do theoretically Cologuard; potentially this here be more you you bit mentioned having you be you’re you to spending that of kind clinicians some of identify add that a a for this? you I primary need? would the money I program think you mentioned criteria attacking that care mean, the big to anything. guys, do about of Can can little how whatnot. how

can Thanks. give primary some you So, about idea important care just how us is?

John Dobak

grown networks. of and a becoming important pain the networks from business what lot think We to to care for for we’ve this primary seen we’re interest and care more these and the because doing clear last exist part a in over dermatology are sort referrals, specialists integrated it’s networks these avoid primary has point really of year, organically, integrated a referrals

of taken mentioned, And them interest so as a some to commence an they’ve working pilots. with in, number we’re I

of physicians groups aggregated care are – these because us, physicians. primary for nice it’s that think I

of So, of to we after make get can tens calls. direct thousands without that having

that meaningful could And be moles of the care so primary to them the that dermatologist going assessment going be with do able direct that profile we that love primary care. And where the primary and on opportunity into I we and primary opportunities effort. from there think find group. think doctors – of do we do that we’re some then those calls product target an some sales a figure for doctors is primary meet basically care are to modest out, I effectively some direct have we there’s shift think discussed. those care a where sales users can to think and I also more We pigmented care

often there, cancer research and after So, those some us that They done on care, But tell rule day through. second in the doctors extremely lesions product. skin refer follow have want dermatologists. laying in out. primary They more for market we’re those They very on they want probably to ground are those because don’t we’ll for It’s quarter way working challenging them other this long. them here. start to assess a to cancer, product, plans that see we’ve to our the and we do to non-melanoma all either foundation interested the carcinoma

to patient to the dermatologist the So, they it urge the to to don’t referral get get of. care have or taken to make

big we So, a there’s there. think opportunity

lay care. in And so that we to some do primary of want foundation

Brian Weinstein

guys. Great. Thanks,

Operator

Oppenheimer. DeGeeter of from Your next Kevin question comes from the line

open. Your line is now

Kevin DeGeeter

taking Hey, the thanks this questions. on my call. my detail for for guys. Thanks to all add I want And

more And of question around a quarter, eight to derms if look orders and of that you I guess, per to average regard a doc your are number little up at guess, some with month, a experienced per so it’s per reasonable I month as with plateau stabilization PLA. perspective nearer-term or out that Do basis kind you begin that have may a where what’s to a test point ordering on metric? on of a of to

John Dobak

Yes.

biopsy surgical know dermatologists, month. take when all all about XX average per of across procedures XX it’s to we that So, you on

XX per And certain we month. do are north so already users seeing of

a So, XX a are one that or month middle three to tier; three users nine then the we the that or the we high buckets, really two users. more call month, and month, measure dabblers; the volume have a

cohorts. through those And so the we’re progression in seeing trends great

they really and once where again, how more moment out are hit kicks getting to to to and they into using integrate practice So streams, they of they’re figure the in able that aha the performance it their it test work be to efficiency more see patients.

opportunity of that us. very XX%, that’s to certainly it’s that, large our or of we XX% gives a healthy to more example we kind is. hard a if the So, biopsies an XX can to than given still just per amount for but only volume, the XX for We that do but penetrate business month XX% think how say, market penetrated exact we here, XX% can number, we say. think decent

Kevin DeGeeter

primary to think great. care of reps on or we markets? talked key in were being where hopefully, question or I That’s walk the Should have we number regard think segregated think certain our care arms how geographic commercial about And markets of lifting in is geographic your a ads you resources you’ll expansion context. key out. versus and about geographic previously, and then markets out, about and the helpful here build think Brian’s primary building COVID of there care? XXXX, their as both other this think on some States, as a primary derm, the infrastructure with of we’ve about us restrictions. where at to XXXX, through Okay, Can some sort build we driven you calling I guess, focused about

John Dobak

Yes.

both our Chief to channel? be to some it’s only existing dense territories to Commercial current would ads to have care sales up targeting, I opportunity, combination direct Officer going going evaluations, second well but a we’re more the some we that quarter. and as want primary that we’ll through some at a on may Todd additional now. we’re as more do do going now rep that there’s capture assess, when primary new target into of process So, expect Todd, additions have concentration present that going not some additional where to dermatology of care professional where opportunity, can we And opening likely that territories through our to where is on be folks. we tap the they are also are opportunities able But some think those to they going to doing themselves. to those sales reps that we as our

blend, for deployment really it for looks doctors those need primary that to that’s doctors records, what the planning that. will understand, and sale. we’re are of like a probably So, lot a care in and a networks, medical then type but sale; care phases. We study. against time where and the It’s integrated more different some those with institutional like pilot things a take electronic type primary of an there’s integration be of

team So, slightly the effort care integrated focus different that we’re primary to on at going cycle. network and that’s sales

Kevin DeGeeter

beyond that with do that And one of the thinking should dynamic the certain QX a dynamic we then the as Medicare At quarter, out I impact is to this through I’m if on should XXXX? think just continue – of last QX. processes about or adjudication playing about may Great. question. into in appreciate largely later first think comments in we regard that point,

John Dobak

like it’s in various be through they like providers Medicare get say not things cycles going and and changes to rely all to updates, kind hard service resolved It’s fully of QX quarterly have They that. to probably time. and takes – that usually upon fixing through the and things different Yes. some

be out QX. fully So, I don’t expect flushed in it to

Kevin DeGeeter

for taking questions. Thanks my Great.

Operator

Capital. of Your Craig-Hallum line Alex comes next question the Nowak from from

Your line now open. is

Alex Nowak

Hello, XXXX. on for the everyone. start Maybe, outlook to

force a marketing XXXX, You could what with a where previously just think spend? as given run control you you for can of what exiting rate XX,XXX roughly, XXXX, you do XX,XXX, tests rate this go end run you mentioned know, just sales larger

John Dobak

formal just of correlates directly new volume, but testing and physician COVID. our loads clearly, the as to XXXX giving new not guidance ads case pandemic we’re for yet, cycles related that the with So,

to that we’re in pandemic we’re grow much and first grow in sample we’re slows So, our to as this we this volumes, I things seeing as can upticks wane, that better subsides. in seeing down. as were headwinds seeing And excited despite we nice the think those pandemic how XXXX, we’re uptick able quarter see

at rate run that December doable. excited I beyond of what we’re based numbers talked on we’re is about the – to seeing grow we we’re And today. based currently going So, is XXXX that end think on

Alex Nowak

I’m even That’s are yet of the see about have issue thinking tests payors’ payors it just of medical you inclusion the great. specifically to policies And to update, reimbursed appeal coverage? of And number incoming their higher, making officially wait is any you a easier February, the take private the starting as – bit little for guideline though NCCN are to denials.

John Dobak

long NCCN claims. to right. the us It’s So, like that we guidelines with appealing think absolutely are that cycle. claims the help We a a cycle appeal – you’re claims appeal process denied, but will is get two through month quarter

in way the investigational, experimental of payors – justify getting common hard, don’t in typical a we will That’s that’s But that the a impact payor be right. denials we So, can’t appealed. know it’s our going a claim. that to what for reason success what I to very denial it’s yet terms think just is of for deny

justify an guideline it’s got hard that recommendation. I for think NCCN denial to them when you’ve

We going to she’s a a on brought much front. So, successful be – the and an really recommendation. managing that person, senior expert just I more going up ramp NCCN very the do think who’s at we’re and appeal to appeal that person leverage guideline process

Alex Nowak

should give just All backlog? sort expect releases COVID That’s last right. what or could former to abate or a as And partners starts your pipeline slightly bigger readouts then would similar you this see it it a off XXXX, expect activity from and any you in pharma great. the question, year? we data of starting the year given be as up And just

John Dobak

out a exist. with there leader diseases. of to folks most for We Howell to trials. our pharma a inflammatory pharma do That’s RFPs support services, have a lot the in is and are provide of of the partners, Mike lot were putting partnerships that where activity their

readouts us occur. to is those going what’s timelines not he’s So, a – open to that’s when to I lot us the And are think doing us the levels in about are would there. I or enrollment back say, help clear really pharma I partners exactly. that dictate to clinical their out pre-COVID to and really what don’t trials

can that with get So, partnerships that as everything subsides. to and is grow think do it’s we our think opportunity going to an else We opportunity. say, hard better for but pandemic us the pharma there’s we like,

Kevin Sun

And just Yes. to add I’ll that.

we’ve so internal kind in go to members are technology, at been other fact resources us pharma Mike more be historically, build the looking proactively some come team devoting of We for it’s some our they’ve and that will unique. partners, to of to team whereas these that Howell a addition as to opportunistic

it’s do quickly to it’ll exactly how but say hard and much. grow, how think we So,

Alex Nowak

That’s you. great. Thank

Operator

Street the from comes question Capital. Flaten Lake from line next Thomas of Your

is line now Your open.

Thomas Flaten

Great. didn’t might’ve And Thanks. the Thanks, it. to guys for comments, going I taking Optum mention you was this project catch John, be completed? and your the questions. Did you when prepared mentioned in

John Dobak

Yes.

think, the going they’re I’m first optimistic done the end I of to or that have that there about. by quarter

the around and end optimistic done we’ll I’m have quarter. nicely. first the so progressing So, it’s that of here

Thomas Flaten

you data, it release that press you’ll you think is or embargo somewhere? And publication us effectively for to will

John Dobak

way and ability publish top-line to impair release will that that doesn’t our think we’ll in either. data the it it the release from a data I we

So, my that that release put out data what on plan I would some like. we looks is –

Thomas Flaten

you thinking to guys rolling over govern to cases? seeing the search COVID think just are – that And a then Are how to doc we you or but terms help about dollars, out on are around, if it about think just of of curious where in the very in that? couple of efforts, year. successful would I’m guys you use a campaign I just what a not about strategically the be just the the DTC seems fewest terms how geo-locating expanding, you may, trying course find

John Dobak

now, Right right. a is area. definitely exactly you’re No, it targeted

lot that COVID heavily, has we you waiting more doctors invest know parking some the become to we access during tell – where room. and would physician the We’re new Todd there’s

are know in we dermatologists. so And dermatologists to tests. had the see in your lot there we’ve patients their us our coming geo-locate waiting saying, it And the works, of some my actually parking and about we when ads calling because hey, in all can are patients asking

it think we doctor’s continue that right So medical effective. from because very in get affected means higher to expand we we The typical now, have products. and technology offices And can are do target successful. digital the action it will is is metrics because it places open That we or it three four to low times than fairly a be effort, campaign. cost where are

even we’ll And opens and more so begin the wane. the to pandemic up country expand it begins more to as

Thomas Flaten

that. on thing more one just then And

So, guys you assuming data. results, as return even find to you docs doc been find a loose you’re math? that and find have volume, and result, guys have Have able the you testing correlations where gone search do I’m to that you between capturing see and tried where back you to

John Dobak

that. at looking are We

sample get out to initial grow They looked have we that. and data. on follow looked you we the allow is, do in if that to volume doctors feature. starting more but – participated more find for know the a We do doctor the It’s will compare and there. more more CRM from that building to hard we’re those at down capabilities better sample find are page the of that than metrics that at doctor the that know us example, capture doctors it search of a we we at beyond are people rapidly don’t, to doctor, doctor have that we in not have funnel We one that’s for some a see getting the growth volumes, search and

paying at to is in a going doctor into invest How we’ll find a we to off to PLA. that’s the to true ultimate ordered some where better get lead tests we’re think right? that. And point, turns at want actually go, what and test do many targeting, actual continue we So, it order searches an

ahead. not We’re yet, there but want we that’s quite where

Thomas Flaten

questions. appreciate Thanks Excellent. the taking it. for I

Operator

comes Your Instructions] Securities. question Draper [Operator line Sandy the of from Truist from next

now Your is open. line

Sandy Draper

of have thanks been to I and know just I for A answered. and John, think, confirm. just them Then questions. already lot my asked Good maybe, want afternoon taking the answer

more guys. it’s payor So, and it going It’s really private or else from else. through everything process the just the sounds that forms consuming the just are time they of is time. no There’s function view discussions your a and you need data anything – meetings like of

like they So, or I confirm just some else results to there’s other see. study to not need wanted something

John Dobak

discussions late with to our payors, more In hasn’t where there issue we of development evidence need been basically. an

results do we in? the we understand trust And do the What’s do – with policy? we pathway? more, time not the evidence how I that that say more final is Now, results, have to do the but to released problems this and in they right that with it emphasis It’s pathway. they obviously study, support? they thing, top-line should critical like do would do – general, the we want on data. see because published we need taking to How current a the review. coverage write a is Things integrate the a

there that’s to a we’re is with the will study some benefit what So, taking want and time. really what do. doing associated OptumInsight They that cost confirm that’s

before. We didn’t I’m even enough we think we’ll have what changed. heard than payors, hearing very entertain we what enough I to that So, because it, we continue volume. data. progress. different have has make They That wouldn’t really And didn’t from discussion like the

Now, we’re generating the volume.

particularly for guidelines. being underestimate around to the now, those the as by action of data. with drive to ramp E&I And we denial the us about appeals discussion generating counter wouldn’t up able the that I ability NCCN We’re appeals payors earlier

more us give make that’s to action going going put think which more payors, on some to really to is coverage. take to want them pain I the

Sandy Draper

thinking And sales Okay, sort terms and of you’ve the some think in on then things back timing expanding great. and know clear already follow-up sort you started you’re you’re do identified terms it of COVID building of wasn’t Or had can had sort side, force of people, I how the feel maybe, sales sales about down Thanks. you other ramp in that slowed out the you you starting so like whether force? of didn’t And That’s really helpful already you and that. the force. much say to my also, reengage how over I just hiring initial heard of discussions commentary. quickly. think I reengage I due to you

John Dobak

professional started retaining what haven’t have is there. and work additional we’re Todd headcount sales to channel the to to the good direct we going is quite Todd So, I mentioned doing that people. think don’t some the that best a figure out – strategy for add problem I

the We the enthusiasm of have around by professional dermatology lot a the with and and what tremendous doing. company dermatology, buzz world we’re

to So, them. place able I exactly, decide we think those as as we’ll find where be to we soon reps want

think those very we’ll to. and and pipeline he I can able back approach candidates to go a good Todd quickly, tremendous candidates has of representatives and they’re be that find

So, to I going element time be to there’s those don’t adding suspect additional decide we headcounts. when real start a

Sandy Draper

questions. are Those Appreciate Thanks. my it. Okay.

John Dobak

great. Thank Okay, you.

Operator

Ladies and today’s gentlemen, this conference call. concludes

disconnect. now for your you may Thank You participation.

DermTech (DMTKQ) 5 Mar 212020 Q4 Earnings call transcript