RENX.L - Earnings call transcript Q3 2024

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Operator

Good morning, and welcome to the Renalytix conference call to review Third Quarter Fiscal Year 2024 Financial Results. [Operator Instructions].

As a reminder, this call is being recorded for replay purposes.

I would now like to turn the call over to Peter DeNardo of Capcomm Partners for a few introductory comments.

Peter DeNardo

Thank you, Olivia. participating call. for all you in today's Thank

on Joining are and James from Renalytix President, James question-and-answer formal remarks to provide is Doran, McCullough, Howard Chief Officer; me for Financial our session. today Sterling, and hand Chief Executive Officer;

begin, of remind you relate I'd XXXX. Litigation Act the statements Private will that statements forward-looking Any to predictions that of or results forward-looking or during expectations of that call Securities to this include like this statements within we management make events, Before during the call are made meaning Reform future performance statements.

market; these of for development, and distributed strategic delivery operations events our collaborations, the the of potential commercial and improve and disease; regarding our and reimbursement marketed; of adopted the KidneyIntelX benefits, and KidneyIntelX; KidneyIntelX, submissions; product include on kidney regarding outcomes, world including optimize of strategies care trends decisions, and expectations growth, clinical successfully expectations of whether plans, or of reimbursement cost including expectations potential savings Examples curtail projections without and KidneyIntelX to prospects will chronic future decisions; statements and including our ability other business end-stage change, physicians in government the limitation, and partnerships and be opportunities of and guidance. benefits regulatory our business; COVID-XX impact and studies policy revenue economic and by patient financing

undue statements. Accordingly, you materially involve these statements. implied from not or could actual place those by statements cause results or These risks differ reliance events to and material that these uncertainties forward-looking on should anticipated

XX, our the section and with business, XXXX, For with our a and Commission. September Securities was Form please of refer on associated Risk Exchange to uncertainties report on that XX-K of the filed risks description Factors annual the

new law, call assumptions. or to Renalytix except as on estimates disclaims are by forward-looking otherwise. on management's forward-looking required obligation, or any projections statements future revise All based financial current intention because events any made or this information, of update statements or and various whether

formal information Code, conference the limited about required. This there May in comments call Takeover that to say regulatory But the we if accurate cannot it under can XX, share we U.K. note sales this information and provide we of restrictions the process, is can time transparently is due the and broadcast while contains disclose to we to only are today, material will as XXXX. suffice and updates any provide news time-sensitive at live developments, that by I'll as today.

over call the James? turn now I'll to James McCullough.

James McCullough

you, Peter. Good Thank morning, afternoon. good

including experienced have public Medicare process, regulatory claims We contractor, data; year. and to -- of coverage X-year beginning Services This which determination to issued or follows Medicare, calendar extensive draft significant utility KidneyIntelX. hearings; an X, the reimbursed. submitted a February over have On submission of a XXXX local for been Government National volume a LCD X now outcomes, productive X-year and

coverage the be term. near expect in determination the final We to issued

kidney chronic such included broad establishing KDIGO. milestone On and final of by hospitals known critical disease international Guidelines advanced use are the and doctors, diagnostic an throughout for KidneyIntelX. XX, for payers clinical KidneyIntelX was followed the guidelines are world March tools, a in as insurance as

well-capitalized the have potential an diagnostics receiving Also joined from additional in the discussions. acquirers company company. in approach disclosed after approach, for Since March, now process this we the formal large, a

given process data reimbursement what we we regulatory clinical restricted achievements our in be of KidneyIntelX now the and outcomes While substantial expect competitive say, and to to on the able guidelines. are sale inclusion

In are as and provide further shareholder standalone as officially which business part our stock value, runway launched equity common entity product or optionality broad FDA-authorized the version the have to KidneyIntelX.dkd KidneyIntelX code enterprise. test for rounds, extended laboratory now rapidly clinical KidneyIntelX.dkd or business KidneyIntelX.dkd whether developed on the test, will completed lab the we April, This our in we schedule. and March and insurance original with remains reimbursement April, CPT a of test we commercial same maximize us pricing bigger established orders. at distinct LDT. supplant In financing receiving and $XXX per fee

approximately end We to hard with Difficult culminating Howard of have focus the from XX% peak, overall cash were at made and of XX% to changes at through with been conserve a OpEx of position by expense grow continue an sales and year-over-year. our impairing to optimizing and to of close steadily of reorganizing overall ability year-over-year reduction further sales Doran a expense near-term is to organization appointment for reduction growth, we options the company the headcount That reduction to turn XX% President on without a reduction the reduction revenue. our expense on April. look

million Renalytix disease in marketing larger has patients global market diabetic diabetic XX now disease is now kidney The patients levels. into of United States. a become disease much sales many companies epidemic open reaching kidney a the population with play with wide and

discussions international now and FDA is to the are authorized potential partners KidneyIntelX with in distribution in clinical international that We patients reach guidelines. these

growth individual quarter-over-quarter, United of test while achieved March. of which completed composed the the of a seeing breadth and care change fiscal force diagnostic the quarter fourth in order the The the continuing end XX% volume are trend, industry, direct early, performers has force seeing into full we and sales and current report that am Towards experienced in increase a sales in direct-to-physician operations The quarter. is which, small trained primary sales physician hired has already pleased new we to force in the first I a States to we of XXXX, in rates ordering. a just are test

series place product In FDA took April. process ordering which of calendar XXXX, a around improvements we implemented launch, have in the

services. improved ease draw ordering Specifically, physician have offering to we customer-facing access patient increased blood our to and

of and kidney we number on such where where are and limited is a patients focus large York, diabetes of New have coverage achieved as Our KidneyIntelX. for with territories disease comprehensive insurance market populations there

while foster FDA the in pose preventative test territories KidneyIntelX inclusion, if near-term medicine precision when guidelines We makes for large authorization determination prognosis chronic population. the These local accelerating sales. KidneyIntelX clinical the in best opportunities choice believe only with of and this coverage and issued combination adoption disease to

regarding Finally, or XX published we several developed have received final FDA's tests questions on April rule laboratory LDTs.

the proposed for process. By achieving long FDA an everyone advanced the authorization around review diagnostic to as of we increased exacting While than a is full that business test tighter for more final KidneyIntelX investment in rule clear innovative such era required barriers felt and consider drafting, is and the this it flexible a high launching will was and entering new testing require regulation FDA language that standards has significant entry KidneyIntelX, technology. our to capital timelines the original

and technology. KidneyIntelX.dkd right paid novo invest full new in and to as FDA Without We Particularly for kidney to get outcomes of markets comprehensive platform care, pathway to insurance large very the to value disease difficult standards address artificial of the and were future. franchise are process real-world significantly diagnostic default believe capable our regulation de data setting and KidneyIntelX the such chronic regulation, we add intellligence-enabled the ones reimbursement. the achieve technologies in heavily of believe FDA clinical that review decision very is becoming a upfront

James our now Sterling, it Financial Chief James? over turn Officer. to will I

Fergus Fleming

financial issued everybody. third XXXX, the Thank March year XX. Today, you, of we which James. for fiscal Hello, the results ended quarter

which U.S. on Our financials dollars, GAAP Form will and financials I were in GAAP today on our here quoted currency. Figures reporting discuss is filed XX-Q. are based our

third the For revenue $XXX,XXX the fiscal of of prior third we quarter, compared for year. quarter recorded to the $XXX,XXX,

a has at under original been Sinai the standard billing since tests model. concluded. Testing Mount comparative As Mount has were $X since that which year the contract under period million with Sinai, reminder, run prior a included commercial performed

testing quarter, tests were processed dominated single for now continue total, outside what diversify which of of half hospital from with largely XXX away up XX% accounting Encouragingly, months had nearly during ago. Sinai of about were XX been a to tests locations the by XX% Mount from the system billable.

KidneyIntelX velocity our following expect test FDA launch official month. other we're health direct-to-physician increasing force experiencing the XXXX, with system stated, sales novo its in to onboarded As de order of last test providers James the authorized calendar version from and be

individual to expenses Medicare, million built novo reported authorization, Medicare resumed for marketing Certain down we XX% NGS continued quarter, GAAP tests spend revenue periods. payment third from a on operating in vendor million spend from basis. allows actions significant on were to reduction prior XXX followed allowing a Operating $X.X us under we including of review, quarter recognition reflects XXX tests that claims sales XX% tests including took This basis, earlier steps on Last the quarter for the and year NGS of consistent a that as has headcount from in organization. reductions. for de well lower the FDA the these our to as expenses, focus period. which $XX Payment

Through the net million XXXX was efforts, we $X about approximately from last pipe fiscal for than share. quarter ago. million tranche direct cash loss quarter March approximately second $X.X and loss $X.X to This from quarter does of is XX. third Net of million ended of cash of March quarter, quarter a those XXXX. per from million include fiscal the raised or with the reduced announced fiscal or XX% per proceeds $XX.X the burn financing of nor gross half share the a the have $X.XX the these year the under This third down $XX.X our $X.X XX% lower which million level month. million registered was $X.XX We $X.X per placement financings. of net We proceeds for not of third in second the the aggregate in million as

ways impairing revenue. to to our continue volumes ability control without test We operating costs explore grow and to carefully

Operator, call now we the open questions. can for please

Operator

[Operator Instructions].

Dan from Stifel. of coming question for the line Now with Arias

Daniel Arias

like those you moved on guideline and James, and mean, for that's clinicians payers the seems taken should needle as what as I test much the be feedback from what's LCD? been place it on else guys, the changes anything usage. the

remaining as changes? talk looking change, I'm some points see those changes be they're you the to just So to details of can to the you answer the to sticking folks level? going if you impact going those tremendously But might on a to the where just And for not they're really be what discrete change? stakeholder to at sure what is they how result, is I'm expect helpful. might see the extent first for the which

James McCullough

a That obviously, includes in includes the it's final payers, obviously, updated and course, draft our And with milestones. good the update we're Dan. We And payers. Yes, includes, milestone that stages LCD, very It including then, significant a of FDA. which the guidelines. data. national continuously question, communication LCD outcomes of with is

payer the to out going updates of stream community. continuous a had we've So

to who you talked give a said major with guidelines, LCD one that's I'll insurance anecdote. We plan CMO the of checkmate.

thing see of for So we the the LCD, final the comprehensive States. issuance can't why reason data, throughout with expect given United health payment threshold the of benefits I crossed a economics the a that we've now this third-party in not KidneyIntelX, GFR KidneyIntelX published usage measured makes of by but which health outcomes, diabetes, a been as measured by difference real-world as slope, also on has kidney HbAXc. in only

drugs. medicine. works. advanced of well So quite are And there at drug are risk these sequence And out be for time works to new patients preventative early inhibitors, how It reasons. on are going GLP-X this are a to a to which expensive at variety a it's very whole able when It which agonist. of therapies, prescribe including working figure SGLTX is you

right of really has been studies. outcome, treatment of is the evidenced whole guidelines. which the and got into therapeutic that's the KidneyIntelX includes precision identification, cost outcome health economics gateway and now we in So medicine, equation extensively one at to in prognosis, put diagnosis that heart and the the reasons sits early And controlling

in we in comprehensive positioned position. think XXXX feel and calendar a feedback for There's are I that good but guarantee, never any coverage, the insurance do so So very we're very very far, good. has been do well we

you It's time. organization data, timeline. of get short thing business. very that outcomes Dan, out, guidelines is sales get I'll difficult and want a into a other when multiyear the very commercial reality doing the see to get a ramp. de short want in years novo But start X a able longitudinal in see period here And we're the people because to always is is to be of point the marketing People this through FDA building produce to process,

So interesting insurance knocking be XXXX terms of in is of very going the coverage. through to the rest

Daniel Arias

that Okay. imagine, Yes, you is. corporate timeline hear you shorter X at being can as investors I less certainly on investors level, -- the years short

OJ's -- So and last test simply, was X,XXX along is to I volumes in which think about tests think should from talk point, Wake lines, trajectory? just quarter. meaningful When I you when during cetera? mean, to off getting the coming on just the that quarter, basis? point, up Utah, so prior the you stay are volumes, down a aggregate, aren't quarter-over-quarter X,XXX from that be with from that can XXX those we ground trend there Forest, St. a on quarter, And non-Sinai on or do those Joe's, down start where where Sinai, Mount volume et reverse point a to we very Is

James McCullough

fabulous That did that from to know, make under as me. a operating early-stage full specific a Sinai is that It pay of complex our I been commercial reduction defined with think testing, environment. a test defined the partner. commercial has with customer. that switching frustrating launch Mount a very This control for has a we a it's first total in this in to year you System Sinai. quite proper volume Health over the and Mount is function to challenge. contract under is environment us been was And contract jump IRB

is the We the optionality bit. important now sales to control. interesting in that we've Howard that growing think the little But very a of and and work for much about direct-to-physician a is is direct And sales our me light, is that, bright starting now. out direct-to-physician talk will added under that thing

resources seeing reorganize of It's And make the achieve. we've do It's quite burn, of a out and brought value flying sales we under go on getting to new I'll coming that airplane, -- Wake We're reorganized platform, groups like an difficult be force, do operating the is other where which a now new human the through coming statement. to quarter board like X Atrium has see expect launch reduced to also Forest on We final company. slowdown down, expect the board. to substantially and people now stages balancing been and belt. act the one its Howard

in importantly expect I forecasting a the an increase we're off without that going testing see and the most volume activity. me, activity. leveling So breadth would for volume testing to of And

XXXX. customer and just not that a dependent as on we're took So place wholly in Mount Sinai single-source

Oliver Sterling

have had tests, Sorry the a after you study may numbers, add, tests. James, XX-month point a nonbillable tests to study the money. interrupt. curtailed If that to was I also total Dan, listed great the we the save quite including And were some after bit terrific opportunity and data

less. you If mainly you lot look less more is the or decline tests, at a than billable indicated, dramatic what flat the just

And distinction. want so that just I important to make

at billable look better just you tests, a it's If much picture.

Daniel Arias

the should you you in brought that James mentioned here That's that? ramp Okay. In James, since to way it with helpful. way, in thinks a he volume up, non-forecasting would forecasted agree coming able be a quarters.

Oliver Sterling

path is yes, But particularly way. pretty side non-forecasted a increasing independent doing, to be Howard so care for the stick work there's and to -- the care primary is primary I'll exciting. that Well, volumes Yes. in certainly a

So some nice growth there.

Operator

line coming Baron question the Pinnacle with next Randy Associates. Our from of

Randy Baron

have administrative I X then a and broader questions couple ones.

Understanding the you the you, is Laurus quickly, really have to to since say come least more it was [ that out Just and potential ] that constraints process for is in this got. at acquisition encouraging, put active inbound in March ongoing? bidders unsolicited fair that, to seem initial on process that hear, me it that

James McCullough

been open patients regulatory which reimbursement on a margin. day, In largely price and the services about the with it's a we the the derisked such I that we which has won't are are is reportable and clinical restricted, in specifically it attached I $XXX has that very that diabetes KidneyIntelX million and And quite kidney So front us say wide per of not derisking of on guidelines. on rare product process. in now significant case fact, the it addresses That's disease. XX you like But large a active, every the result, gives comment it's will market. and find so is that United to front, is it States, a

in, the good get data, insurance allowed is heavily health through reimbursement we've which again, invested the get And also us health. and important, in affects which very which diabetes get guidelines and so and is FDA, to not kidney only has but

developed this, intelligence-enabled associated here, biomarker barriers expense for So a singular with product. blood-based tests a the you and have artificial FDA on entry look laboratory doing in driven, very are from with the to vitro the And prognostic. new high

at only is are multiple precision huge this solution surprised attract we front just not would And the really this from not the funnel. that, significant of diagnostic preventative that in industry. medicine disease players, So the end interest

we and want option. to sales option, us product our Acquisition and market. effort, Obviously, find. address of the But that Strategic to with increase continue to the allow this partnering a is we marketing have all an here. significant optionality to which is is an rare is

we're So competitive. be not process that would surprised this

Randy Baron

Great. question for administrative you. And an just then, OJ,

a You a of of forma in couple guys series cash the did What's today? raises quarter. pro

Oliver Sterling

in to call. cash million during don't So I $X.X past cash the we haven't XX. March a reported given want this in on spot balance I --

not change on million policy $X.X from $X.X registered million now. the XX, nor that March the from $X.X the pipe tranche of of won't the include million But does the So cash direct. the and second

figure million So days was XX that from $X.X ago.

enough can to but with arm your do estimate, I provide So that now. that detail information should you that's the

Randy Baron

volume talk you quick number. just missed questions. I for interesting at James. then and and is this the And you level. test changes I really the was about X the direct-to-physician the Howard, here, guess of Okay. broad breadth script It

about on you activity, just done cetera? But reorganization you've growth. activities or I and many now, align et how think to broadly you XX% sales the talk commercial said do what do, what did you can XX% have salespeople market our

Howard Doran

the I Randy. Yes. question, will answer

and that entire last actually were first retooled sales We X So much team foremost, XXXX. since legacy have the members it have been and actually the we was summer. that us between team XXXX from pretty what have with of

that additional brought this discussed remaining and last new that past this X are in as we folks, X we class the on our call from have we August, training We folks December. had

of January time was So the quarter. current in their first this really field this

just is change have. big So that the folks we

And come new folks these our that last strong just their of with the come about background. with folks with on past. comes as call, experience -- group talked that in we diagnostic Half nephrology

referral So the they just thought they're supportive of they're assist the but know big et able to practices, the some key are general are efforts, because get out going leaders, to of can of also nephrologists that into PCPs the our us with the patterns. out that And practicing also cetera. part recommendation very the with

those So can helpful. having folks addition that doors, knock also on is in

of X-year came the allowed look story. our data during just triggers complete a this that materials. to outcomes I us is biggest taken marketing And having at period, really We've think the the one

-- for it have the this for do question with medium you I a to matter, patient. what going PCP have of and Obviously, that's a information? we But or actionable? nephrologists is, does. test do that the We results Is very what low, the to test gives very risk it ask it what's now high simple understand first

therapeutic you tools lot And of do more can patients, for toolkit there's of standpoint that wise these a now a a in lot what the choices. there's from

was put seeing XX% example, risk clearly, SGLTX. a were outcome in that the patients being evidence where, our are in we study category, increase there on high for So in

really X we're Yes. mentioned third referencing what And patient betterment does outcomes? GFR. our distinct all we're So the James think moment it now. really about you just that is, of again, the we've And the materials are in is, the is, the Is highlighting a things or highlighting do? -- question of when thing One ago, right that test it and one what then are is the there's actionable? clinical answered

being is stabilized kidney is So -- further function climate the means when is -- by kidney function more potentially it means decline in extends that, that mean GFR or negative flattening actually what outcomes. of withheld being runway curves, which the the to I

that a about it's GFR much it's reduction result causing XX% is a lowering in -- So that assistance. that of the

When to UACR reduction of in also you medication. based measure damage, go a on a which is kidney UACR, the we're seeing

of general, is health So in the kidney slowing. the disease progression

and in a three that's That's additional our doing So they're One checkpoint. the with because also then testing And X/X HEDIS very patients, all high a down measures. back is XXX/XX statistically factors, important. of saw to AXc, HEDIS intermediate significant we're normal seen And this retreat HEDIS new a to range. study in patients HEDIS also combination function. ACR test. our and is risk pressure in blood also their risk lowering That's we've a reduction. that

out quality kidney distinct associated out study. -- improvements as X they there's with HEDIS our as health, well So in of coming outcome measures are this of

message was of the didn't much to for simpler the that that understand. last in that's clinicians sort So story tighter incorporated been the have. piece we really And a of

So I with better say variables, new broader approach on X a KidneyIntelX.dkd. are the and experience team of with very streamlined advantages the data coupled biggest those would

Randy Baron

touched LCD. James, I To Howard. the And I'll comment when then in of back the event. queue. I open guess, That's importance negative is, I my on you. like Dan an It clearly comments question, see the last my in for didn't go This knowledge, and great, any looked, sounds period.

to So And what you happen? finalization implications? when do the are expect

James McCullough

you're when not you. guidelines. there's easy in all. of until before combination processes sooner Services They time especially in are lot been has could Government production with The than the They to September National a There's nothing required, at data The We September. a that's area, are -- innovating an frame. implications long issue. take could it These Yes. especially standard time. see significant,

risk prediction early difficult disease a to thing chronic really, is do. So of

end. government validation, level Medicare primary of of it large not it's for organizations of that lot lot even technology with requires care and And significant of a saw for the physician to us going a and in get a to lot and a a accuracy FDA, though through interpret do risk and way to such a able to easy a amount to there's this replicate. simple back major be validation with into is a we data, coverage early proof This these declare required be of population process. event Getting to

And I think, you've are the really gave and is one I'm long-term the Medicare got comments you I you a did enter paradigm you hearing, this that on, in new when guidelines And the terms coverage cover health advantage of a don't in in place. with economics company data, does see with a medicine, why KidneyIntelX insurance KidneyIntelX. preventative case I an clear not of earlier

KidneyIntelX. And an wins. that $XXX,XXX year. fall because government for on is will -- in The don't kidney year we don't why progressive company cost I JAMA win. thinkers, patient wins. amount patients educate dialysis, they're alone on over which companies benefits using inordinate failure into last wins a case a for The spending insurance published physicians money the of wins. The see insurance Everybody of treatment dialysis for first year, Obviously,

everything a a and And place. time has

We drugs disease, have available. diabetes. good if that now importance have especially of is the data. educating with now very pharma on have diagnosing Insurance kidney And they coverage, are you us the out

your it Do top of So diabetes, kidney risk kidney and years. diabetes you experiencing simple, the be don't very a And if understand disease. over right? than have decline an or you high of KidneyIntelX have become XX% to equation patients the now failure kidney X/X risk for have to greater you? by event, you have we the chance to couple in know at kidney you disease, or a because function of next you If XX% diagnosed have have significant

stage be and you can disease. kidney if bottom unlikely XX% low you're regardless moderate-stage you progress. KidneyIntelX, by highly risk The at But patients of of grade, are to

for to easy not who's this an we and should This care huge in really risk disease and rapidly this a now, white at marginal at the and funnel, determine time, and front very black So primary strong, a who can to equation. equation the of be end first and way for me, treated a who's physician is not. is

the benefits significant. payoff very catching everybody comes early KidneyIntelX so So not and of is cost with quickly, the because people

eliminate of cost. of whole of can lot we a So and patients across lot whole suffering a millions

do How chronic not populations have This you forward. but all face early, disease that accurate Because the for disease? manage clinical the assessment, prognosis, the And is is issue too medicine how can't and go lost this to in early are much you large. really manage chronic you've paradigm further, too prognosis we if you war. everybody, treat early already we accurate don't risk going

we prognosis the in with disease care LCD, the here, equation beautiful outcomes achieved the early-stage guidelines. an now approved, have now should an FDA be world And really of for what And now in the this we've And around is complete. standard big state.

move validation, the and So the I to adoption. towards clinical going do start to critical community it is and help think LCD issuance key is a

Operator

with coming question from next the Mark BTIG. of our And line Massaro

Mark Massaro

Okay.

roughly months, there been have remind who have. this the has just you've But in in towards a you made folks KDIGO you maybe do have Medicaid past, of Medicaid greater me couple on headcount. commercial team XX payer Do So in last X any metrics it, at And of payers, contracts. capacity? update number and, you payers movement front you've commercial think that final contracts, in the engaging have disclosed number payers like some And reductions call months you guys state time? of could of private XX you into guidelines the of ago. coverage got an pairs in today? Obviously, I And you a

James McCullough

is ended And Yes. what And I'll interacts efficient The which question. last been that with with I access market we group, up take think obviously group painful. that is have headcount reduction has payers. an the

-- because as burden a has the contracts. payer you payer third-party of on a have goes maintaining and burden we along with get been for -- working that more with there's while burden who We have more group now, we've administration billing administrative more and more taken also those larger that contracts, a

more there. able And to find so a we've efficient mix been

the in this process. And again, call, is as originally on I earlier a dynamic said

adopters, how different complex enormous early learned are I've Medicaid. different an there It's mid coverage. care, create economics, an do different payers. late proof. and adopters. This with payer drivers. of right? There is ideas national you payers adopters about difficult, requires So value-based amount of have comprehensive data equation you very lot it Because Medicare, of and an are health There local different awful There's are incredibly and payers, ideas

Illinois EmblemHealth Shield, Shield, over These Cross Blue sophisticated test And able They care Texas diligence us data for advanced diagnostic Blue which for covers like in like to require be I a think, an coverage members; they believe contracts are get I York X the members; which very especially Cross example, and Blue Blue for covers before KidneyIntelX. to issue of New groups. million million X at they lot a look determination, City. over

are that investment. them deemed Many of data, utility be just and there's outcomes significant Many to no you're time, time And requires Otherwise, experimental. now FDA. requiring is a a function, not which data, them require shortcut. of

at died get don't can't this from fortunate you dynamic this of if research get and very paid, we've a fight to big up. going was the business. reimbursement. be And this, all because uphill knew on the have project, you very been Renalytix, had a we we've to beginning hill So have We an you

on FDA. very was well. of this, go outcomes course, data. to So the as the through made beginning, We getting generate to had choice all from focused the of to we guidelines And knew we

-- diabetes, drug right? Now physician prescription we not FDA people the laboratory continual adding final to a complex So put I major complex been you're cannot been major are now and chronic to a screening are disease can a health about why with has could in is that primary walking multiple is shouldn't developed reason not guidelines, we table. logical say, process. actuarial outcomes -- with There's data. reason no guidelines update office Having And the expensive test." short-term understand we're "Oh, diseases why especially very Nobody talking These longer experimental. no a can a here. kidney just risk help because just This a a -- a a draft represent of sequence primary decisions, no risk the the of patient. to LCD risk. reason, point care busy exposure you disease into a care whole insurer, see we're that significant very payer it patients

This medicine KidneyIntelX becomes actionable, to figuring be precision rapid. right? So it primary spend a It's be by what prognosis, be money regulated. simple. prognosis, very lot to be having This the time we because the disease, care becomes got the which suffering here all early critical got the to all risk. of table States. is to can of the utilized primary and this It's getting pounding which I'm very physician. understanding and for is which and is in It's disease out equity key, got downstream the chronic expense, critical United level is managing downstream in and And to the it equation the the and at managing solution health care

risk, Physicians understand don't in understanding we made. a XX% the be be of or cycle prescribing room. data. We're Today people KidneyIntelX, the enter who crash in now may the risk. of patients if who catheterizations. respond decisions not $X,XXX who not through States, hemodialysis, you all And biologics now month consequence. the there, the into it still United not, clinical see risk high see and do and without this We're we are may real-world the From still having can emergency

you can't a understand then you can and do to spectrum, where very are is unless understand disease it unless the characterize not way, risk you control in So in ability you it. which easy, you the simple the

and significant we're continuing have the front is So are of but numbers of me, listed of all the the LCD don't landscape. I them on update website for a payer event lot and in we to us the on don't a board. do do lot on issue I need money of would X-Ks They're like with an kidney material spending events. I that awful payers coming to see national disease. late-stage spend they to --

characterization that clear implement in progression systems, across goes insuring. you're much huge abundantly and you is prevent now medicine and preventative now populations that to place on you start they a get KidneyIntelX If these better their it

a of coverage. So XXXX think rest off I we're position the knock for win-win to the insurance in

Mark Massaro

about get at? you going And talked Or by an NCD, the or are great the see it a there? guys sooner. would go past, to a final That's helpful. LCD be the James, opportunity is September getting in it just to still you national Okay. just know coverage the I certainly, and determination. looking about pathway really Is LCD more that potential from

James McCullough

It still is a possibility.

We us. for are purposes, speaking for with speaking an FDA. LCD But game all with finishes practical CMS, think we are the I

now being little Medicare long a in And review. laboratory, contractor a now national It's government draft to -- to York paid. has We're issued Services LCD. bill can everybody, at process is get services Government convention is to individual cumbersome. just the called National that we bit we as issue $XXX our claim ICR, remind and the New paid that under going as And samples

from will beneficiary, So the can we pipeline. another the a issuance clinical be of the any LCD an smoothing around again, into take Medicare anywhere incremental sample But world.

sample long York laboratory, As as that New Medicare. in process our we we build can

we So a KidneyIntelX. means population entire Medicare with LCD the service that final can

Mark Massaro

factor do sales rate What healthy potential should that? yes, limiting flat a couple of if to Last me, right. that But the at something are All organization. what and force? no -- to capital stay there term, longer commercial appreciate expect this to XX year? sounds force. how the expect then we eye understand years? Or see you you in It was that I sales burn keep That's you add update XX this cash to you there is stay people look there I like capital year? And Do great. question like would have the is there a on. on with for your to approximately Howard, on

Howard Doran

Mark. Sure, Yes.

correct. you're So

what We are currently regards today. XX at we have in to

though, or its is looking we're far out of fruition, opening to the those that as the day, things that trying working have end prove We potentially as came of with that if are always couple team would now opportunities new year. currently in to in see doors new we the we with larger be on we're -- really folks. can we're at And first X groups. we what the to a At access adding X what's the that productivity

So paying we're attention to. the that that's closest really the measuring stick

spend would and cautious be by maximize inflection points But couple we be very because to still that want our be to small but yes, covered that existing there We'd we able in the of team. of would are opportunities. a deliberate not be

will be but we -- those, as So about certainly, come on talk would the certainly those that we will adds. board,

as far we very we the we've before, we're with favorable rate what markets diabetics chronic as overlaid care. managed the actual penetration need, markets discussed of as X think have kidney a follow in, have I that high type with disease,

us for now are Louisiana. New York, right markets North Texas Florida, Carolina, Ohio, and Those

as reimbursement, the much of for from us care and talking standpoint markets just need very need, we programs those. as board, so across standpoint about be a a And are successful we've managed strong additional the LCD been and having strong strong that those of contracts from within the to

be organizations right? at places had tremendous those has who characteristics, So We that many best the from we there's be the would we coupled time. look, it looking expansion Obviously, field a still have number want a same that would first standpoint, yes, have and the in of at sales go we to reimbursement. sizes. of with type would the to put would I've where the of opportunities need, deploy -- And funding an lot

you there. be that one what little hypothetically hard could had without more X a direct would you that's do? So answer discussing dollars, to if I

But level, we foresee to We of we events sit the most over time. We I want couple can you additional due to other want a months, PCP over to to continue just, firm number that to on. the magnify just at couple likely give know other couldn't drive than yes, raise. want results working we as next expand. and that the we we're today, some of I here adds now that

Operator

coming of H.C. Chen next Yi Wainwright. with our question And from the line

Unknown Analyst

This is Yi for [ Ashton on Chen. ]

question what timeframe cash the VA adoption test system? flow hurdles Also, wide First the the to are the achieve of estimated is, for breakeven? what in is

James McCullough

the the I So VA services that general which is back. you if right? of price come in when reimbursement you which down me point, get administration to way, had never important, also to school. contract, the One is we you by for retaining price the price somebody took thought or else, system we lessons still a have, lower negotiate a a great it

and CMS point, to in cross price And we that for VA covers point. services the margin the the walk is general of down administration also $XXX which retains price, the price backed the not lock $XXX, price having obviously a having So and that on value have market. the and the system that addressable

after Many face. about complete system were advanced VA, like inefficiencies. it overhired to out there to in XXX I We're and of had VA system, them we're a what the overoptimistic And an We many complex it VA. differently, substantially to different overestimated. KidneyIntelX. as we the it turns we we But that one go entity. prognostic able individual really going achieve. do in to became like think roll view out There And incredibly operate national support, and is on something VA and into sites ironies, we had

think have market never that diabetic gain I've and it's it's -- are want capital because million And veterans important XXX I fabulous thought a in such approach the before. never large. markets that We again, to sector. effort experienced never by I've a in access experienced and derating a And a I'm believe we do are come care kidney date, space. sorry, environment, can future from from I over believe there benefit an and do had I traction. disease over to limited that which are we VA I patients markets. a at such to would But drop in we this capital the to integrate There top-down of, taken be X VA would go should still market I KidneyIntelX. who space. the And back

been very conditions very I having and will working takes one approved provider few large and and not insurance off. us. really of cancer that's broad in. expect the experience plans VA on with learned 'XX, sales successful But maybe we've in we've calendar out And diagnostic be the regions 'XX. Howard a alongside in coverage, calendar a we large So to lessons of take we'll do going cervical our launches, reorg'd around other including in model go his diabetes there. back you It's of now figure the high we're have a reasons It high-performing clinical limited part specific rates in to areas. focused while where a If force

in Where basis it lenses. has ongoing a not. a didn't question come We a commercial ago. at on been or year This we young in it does until One, just are KidneyIntelX the mountains: believe last business, the over and look the in just launch adoption I still April really we X in? cross force company, and so an month. outcomes all of business you've reimbursement, It's FDA worst approved And worst because these KidneyIntelX, And best launching is got FDA, it's business. data now and diagnostics Medicare the guidelines. to are

believe is behind it infrastructure good this us. to high is. ready get because becomes very clinical not to got barriers the do business problem deeper know of says, diagnostics care." We've things, your use entry to got before very a only it something and all but is a growing. about those it. disease, a it's things of very you crossed be and all becomes more something is even going where now what are should about And this And it And I away, kidney clear those the across to You now got conservative of "Okay, how codified this diabetic standard as into The we've not risk a significant early is. I

changes it it know analog have the kidney soon cost. disease. possible. your is the I And it cancer true changes When outcomes, your you changes same with very is of and Because As do you paradigm, treatment came the as suffering world. want cancer? your The out to clear. prostate

function are start us, significant the it of to treat like treat for percentage matter years to the we GLP-Xs. now. it get question we we a know, X phone a drugs of does going inhibitors For We can to sooner the The it is, All But we have not going eventually most on ago, lose SGLTX of to sooner it's us kidney it. doesn't. older. as And matter? X, lot. and And didn't us,

it's much no matter okay, and in with investor by guidelines insurance to broad The FDA-approved paid time, And Interest change. us rates markets will that a that's now come is rational for medicine the that adoption. prognostic for is me, up is right? set there's a this precision reason time. why, And will So product of things and capital but change. isn't sentiment giving eventually down not

other. us, for of in front foot the So it's one

force And doctor, very a what patients." FDA We the messaging the It's very clear. awful goes high-performing have of couple have guidelines. boiling tool going specific major the in that now is it's into learned who one is messaging last sales in not after ocean. complications diabetes KidneyIntelX. We've of And a is over all an the focused, clinical that insurance. very regions. your lot We the is "Hey, the about years We're to approved. ordering which accept right physician we

diabetes happens your here's standard patients' it's And when you improve only your use disease, but improve you what of kidney So health. it. do guideline care. you Not

right we've incrementally. heavily in to cost. critically to adoption rationale That's got a But strong. invested put very So It's drive It's data-driven. We've the data, now is us We've in got team the the comprehensive. good has in place. position important. which the watch

have We organization. the rightsized

cash company. diagnostic services So we're Medicare for company, clinical reimbursed ton burning of a not a

burn put other, foot come. the Our I of quite front in the will is now nose and just think and good. one down keep adoption we our got And actually operating to

it I this point. time of at is a think function

of strategic optionality. is comes to It The That we function And comes raise the shareholder in again. LCD was how is now capital. do that going which a will value? runway, help competitive visibility of the the in comes final form And is to question maximize issued. And of the form a process. equity when optionality down

long run on that have basis. to continue an as can possible or process want incremental we the So we a can we competitive runway so business a to grow

areas in roll approved you -- us powerful very the we number by a a in guidelines. it's covered which the hospital out. have and say of primary XXXX can physician simple of additional primary of walk message significant We front when partners, additional opportunities in terms where FDA care and in this care into and is say, actionable is solution, a And insurance and

time, not for adoption will checked cannot all we I the have in believe So the And the follow. position we that are boxes. first where

have Of it. course, prove we to

of optionality a leadership, that under model. And I sales direct-to-physician prove additional now business to with great built out again, think that the us performers provides force we've high

Unknown Analyst

timeframe cash is next question flow to what breakeven? is estimated achieve And the

James McCullough

Yes.

it that's do. the going certainly, not is the is answer reorganization we're was we're But So which to going not what point to of much breakeven than that with forecast, lower because a company. our

Operator

Instructions]. [Operator

Our line coming question Partners. from of the [indiscernible] Capital next DM with

Unknown Analyst

I about this Howard. towards quarter and talking kind want tailor to that here, you you those reported billable. of what had It's XX% of that said you're building but the on XXX were tests you in

system us it So XXX Of of to driven people those envelope, those how of number, driven? sales back billable tests. the were that were of and many how takes many

Howard Doran

about we actual number, and So, other of that is roughly. is the have Sinai PCP Bobby, XX% the sales

Unknown Analyst

have in you Or Wake Do Sinai. that is it Sinai? Is mix? just

Howard Doran

Sinai. Just

Unknown Analyst

with, system? Okay. to And the expect XX-XX is salespeople, forward that mix go you that this

Howard Doran

I the of But PCP our our expect accounts, PCP bucket right? actually in to the volume. largest in the business chunk too have the enterprise that be and have largest that would business, the not future would I No, expect distant be We'll would of we'll future, PCP.

Unknown Analyst

Like [indiscernible]?

Howard Doran

that, even yes. than hope I to better would but do

Unknown Analyst

growth trajectory Okay. And here. kind of looking at

of it, is lower, PCP, got call XX% tests, number. just you've is That's, of that -- just kind those If salespeople driven. XXX

that there out those we around and opposed salespeople? at? salespeople the to, have you Where salespeople been quite are say, of out X as since XXX a have those how looking X,XXX So who salespeople to while looking of have are at August. been You tests for now tests getting

Howard Doran

Yes.

So at larger organization, correct. I we things. would say sales a of is, had One point, a couple much one

that they're that folks the very called we have I So the legacy team. were, earlier, obviously profile territories X on actually wanted right X productive the people that

that's in first group again, has group. fairly The that that's August, started new. So still

got we've belt. had of quarters December X a is under So in folks started then, that who this new first. of couple their quarter, past And course, we their

to cetera, a as current at X as out momentum, broadly on line. as point, that data growth about now. in we've team quarter to rate past. far in anticipate in numbers have the we're new we right? that little down that on necessarily point, At beyond far got the start So not talking about. the the point. get comments what for us as original hit this We've thinking the But X similar and And I'm that quarters growth talking alluded to our quarter occurring, right quarter to got this be that our now, I'll rate what's bit is this we focused depending X look further more second that, et script a We gives or you're data

more make a to under think take data of it. bit just I a at answer a So want our little that on I projection don't want to able to definitively current belt, quarter I call. point be look And next get one. a I'd this

Unknown Analyst

how those X you're and these their the in -- working and sales same salespeople channels? doing long regardless salespeople new So X the marketing been they've bucket of operating in

Howard Doran

just with can really didn't it. I'm it they set a what the are looking for background different expect slightly at way. and profile and that how we person month they I what trajectory can say anything of do and of two. that or No, saying rapidly wouldn't it do necessarily first takes different And we

of particularly where really we're folks looking what going. is data months new that only trajectory is So on the and a at few seeing

comfortable time. to today. they're me date, question August, be too some it projecting just I'm a than a again, I expect we're pleased very it's with and what folks continue with relatively I To in We've Even you further made out et changes, better little that's over to the new. cetera. to think early. But you're it, just I asking think starting

Unknown Analyst

about because see the is because to mean talking volume a right, runway, I market, pick I sales Okay. James going just just here up? have to was think,

Howard Doran

we're catalysts -- will that have better just we with upon think again, will with what be the today. have that settled, happy I allow And time. team to I we

this I'm differently a as We with feel to more And discussion future quarter trying once belts That's have that X our all little under conclude group. to we as quarter. indicate far I will you.

Unknown Analyst

mind. more, getting What if the One of conversion front you doctors? right. All be to you expect do for in don't rate

Howard Doran

quarter? per new For doctors

Unknown Analyst

you doctors per expecting? you're new what quarter your conversion kind of Yes, doctors, and are in are those once front then of rates

Howard Doran

Yes.

So giving not. I sound a together and were a the it clinician hard back, test, say very just was I our say not what's thing message it's is call and holds they to a going it very work. would to that easy still take most But tight. I'm in they're to get the And surprises it. me would to and if step ask the It's interested the that positive? say, going that clinical I message if is going you now me, on because

part identification. challenging most The patient is

features broader takes our actually That's to and a biggest have slower process, it's to adoption. yet chronic who being and run not disease barrier of lot all then into patient handholding go and it's So And that test. has it to business. type able the staged a with it's sticky we are kidney data who need all right, my diabetics, X I the a their who finding, clinical

more simpler, We but of better are past, have working of that access next the sticky some by making rhythm access That's barriers their come patients phlebotomy and been providing that for pushed into the -- to thing nephrology checkup. the identifying the in challenge. on them ordering they before me, in most us better important excuse getting taking providing on biggest it is make ways

adoption it So in the is our definitely than was different past.

months. today, how the an seeing test over on are ordering they start the doctor We the quickly closes subsequent uptick

way conversion very we definitely ramp bigger But I We quite for to on them we changed, them inflection continue a will these a change think can simple hone behavior seeing they we patients. to there. see a think, as And definitely are even a have have identified, of I bit. when point identify

Unknown Analyst

test, to just one, who to if the for do expectation TAM And final you ordered we your XXX have you presentations, PCP those what's you you let a expect? capture. And how a convert -- go. the $XX how doctor going many Okay. tests of following salespeople XXX how have much actually have a to Or expected to are gauge to new those if million I'm they using expect numbers, order out round being of Renalytix trying do test. orders? I'll is salespeople, those many can And that doctors of be -- particular

Howard Doran

that like I disclose at we've But green you've to ready really all measurements mean belt and asking rate and things we're go just chosen do things. to described, that's a about just yet. it's right? to that Again, we're you're the to the just looking another be not a more the asking right just is granularity quarter you're my definitive. a granularity team, that get that doing we're -- What questions I under again, that's mean, we're good I'd some not to.

Unknown Analyst

appreciate your time. I Well, Okay.

James McCullough

to that there I reduce think incremental sequence one. resistance important identification which in clinical is Obviously, come together to are the whole of a it's pathway. note the patient changes,

One table a of Howard is the the improvements. sequence things incremental to that brought has of

world. that simpler requisition much fashion, So it's of in experience in FDA compliant revised real product a the we function for originally to we the procedure compliant launch physician now a and with I that's example, April, sheet. FDA reading. the in and referred be But order the that We in revised had what script to this from but a

better pathway, are resistance in these collectively, the to to the mundane absolutely reducing Increasing add but critical. And phlebotomy access, up which things, adoption. lead they

I significantly now to the of patients changes to cycle. up, to be we've one draw while that adoption add want across I will increased of But to if stations access Howard, the add out. country. blood all a that? in you and And figure that reflected don't know took So the us believe anything these

Howard Doran

can think us, to is do we're trying to experience. with right, start make back it thinking customer easier right. then, do raise improve What more we business your question we and and really test, we And to are No, that's that really other I -- Because, the in that, penetration disruptive we So the those, so forth. processes. about their are to But deeper we right? workflow send-out have same a boat. lot streamlined a again, there's utilize to of which companies the are

work that's it hit a building -- And So takes that some relationship It's reality. until takes they pedal it's it a to keep on negative. their not some rhythm. strong just and those

lot points, few needs office a of of be touch And happen systematically. in times week. rhythm, their integration once a to But months can hit there's early more couple that an particularly in things a they the then of

measuring question but all you to, to confident just time give were answer is, you highly still feel to that referring back your don't would think have I things So enough in. the we we're I an that

what we're the mean a -- improvements lot very about, are point just well. talking to simple of of a James that's yes, But easier just one, process over I is doing. better learnings going that So form. out still a to use a lot

it out results day. clinical actually requires thinks But test fill put used less practice look to Well, X that it them one very features asking and to if they're new more to It requisition now. takes towards form. and go had The time, what that, X someone with X about the XX their right? testimony our to up doing takes it office to Those during in require on already are X the them our that old importantly, do LDT. it the to we're favorably and add it I seconds one. time takes mean to minutes

and they those get very actually to are have X X commonly Now only used.

ask So for those. it's a real easy to lift

and by to it's that a them But clinician, and may lot of there not addressing one. we're the there's important them, one to So little things you're sound that when out and big you. big

you're that answer asking back it help So again, what just, is ramp business to The yes. goes faster? will is this us that

Operator

the with from coming of next Jens Our question Lindqvist Investec. line

Jens Lindqvist

of for me. couple ones a quick Just

quarter, pricing, a reported test, understand has agreement, of for translates through quarter, per I new correctly. into you $XXX,XXX all, mean, revenue this which $XXX Sinai that the I on billable committed that is Mount been under quite that in $XXX over place which paying if of the the to of is the just commercial it First bit

me there forward? in help we PCP you going is be some heavy question. So should just Is appears discounting that pretty to could dynamic, channel? that -- first the understand something So please? extrapolate that's my there And

provide time form much takeover at is the anonymity, of the you probably indicative one second can't say are moment. I et how The you assuming I but here? that review, is too for you guess, on potential the cetera, line can acquirers code. long we'll could about ongoing review it, determine appreciate under strategic Because some allowed

when So whether of pursue would you in route for expect different of can some an terms form update or a commercialization? strategic option M&A

James McCullough

me I'm we in convention. to becoming under company, strategic the know. the impressive how this the have and seriously you U.K. whiff let approaches. the we're familiar takes strategic there's And obligation market a U.K. an what takeover now again, say interest then panel can a the So on to in because option, is of limited it a was convention, if And

this were we us with so the to and a -- more a And bit regard little unsolicited whiff approach. was than

The had so a expert, not announce. much it process announcing take we now easier additional again, announced, element to this without grain is, disclosure of to lawyer, with I'm advantage salt. and an to we requirements. not an talk obligation So I'm of an please players But a have creates that of

process will life. its take And so own the

accrue company large I the we that long will obviously, line. in this don't And more at leads. looking be. it sales time that process, that time People and that lines include are have the players know the better

time is a not little thing. So of bad taking a bit

happens, what I maximizing and to don't will do back shareholder know. incredibly move optionality to value continue in along. competitive say an to the the ultimately, again, process And goes is be more, now. it any expect want to market but what and we creating again, But But right difficult don't and I

then not We Administration and not intents and and pricing we pricing, hard That of OJ is for to will purposes. General is that all CMS $XXX. and at cover achieve price we will Services the at terms pricing our this, $XXX, price do In fought $XXX discount compromise.

test the complexity However, within is of the insurance This standard ultimately infrastructure, gets not convention. every paid.

and expect, OJ, somewhere forward correct of the in then would going price on you mid-$XXXs. we average me, So

Oliver Sterling

So right.

James, math So working is discounting. not you're the any of the out, result

billable. So it's XXX are total tests, XX%

billable pay is So we don't are and et appeal they $XXX, do full covered Many by ] insurance with. ultimately if recognizable every those those some one away the that them of contract of have of because XXX don't those, we tests And pay. [ right cetera. not a do

see result a difference there the is just you So that of timing.

So billable of volume goes into we is The testing that rest collect at over of line. the about ultimately, immediately revenue least that rest, recognizable, XX% the some time.

Operator

the queue your And may further gentlemen, at concludes this Ladies disconnect. conference. questions and I'm you showing participation, time. today's you this now no and all for Thank in

Renalytix (RTNXF) 15 May 242024 Q3 Earnings call transcript