MYGN - Earnings call transcript Q4 2020

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Operator

Greetings and welcome to the Myriad Genetics Fourth Quarter 2020 Financial Earnings Call.

During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. And as a remainder, this conference is being recorded Thursday, August 13, 2020. I'd now like to turn it to Scott Gleason, VP, Investor Relations. ahead. go Please

Scott Gleason

afternoon. earnings Good Myriad fourth Genetics Thanks, Welcome XXXX call. quarter Keith. to

call, the question-and-answer During released will we the review which, will today financial we host a session. after we results

Executive webcast a Officer chance our be with Strategy, Gleason, Financial will and newly announced and can our and Investors the If you've Chief Vice on our the today not to our our can President will of release, be section found I'm a quarterly myriad.com. at call Corporate President on in Bryan me Paul review Chief website. and and Officer. be Diaz, Riggsbee, website Senior heard at recording the call it This archived of live earnings Scott be via Relations had Investor myriad.com,

materially expectations some company's regarding forward-looking With to on a to call materially In Investors Commission, forward-looking Reports to turn its the actual statements to company our cause time following identify of These adversely Quarterly our that, to addition, from there's be projections X-K. and financial the Form XX-Q future specifically and in presentation files of Report I'm performance that management's time Form XX-K, the refer the Securities on other today We over Current documents results reasons. Please statements. and the factors the may section and pleased or the Form slide the contained those of documents Exchange could to X-K. you these These on variety filed projections future call company. or the from Bryan. based on differ will important that with risk information Reports which its presented Annual of website, Form the actual may call contain on today's pertaining results differ or expectations from and the on events for current the a are events and statements note

R. Bryan Riggsbee

Thanks, Scott.

the impact team This testing I are at from These faced our have challenge times its elective on the a and very but continue that pandemic quarter, ensuring patients of and volume. Myriad are challenging proud significant Myriad able who am They job extremely an of that have done the industry. global incredible to to been challenge best depend rising in serve providers we on us. and the to

quarter the end of progressed, XX% the the recovery volume saw by pre-pandemic on As we quarter. significant average of a with levels increasing to

Much our Importantly, to was shipments. of the biggest recovery core due and sample direct-to-patient progress new improvements was with in cancer franchise. telemedicine kit hereditary our collection

We will to quarters. in upon look coming build to the capabilities these continue

our fiscal primary a in challenges to relevant we this prescribe catalyst and a fortunate care year company the changes his covering prior base expected our providers of received we arrangement. and in CEO the to dramatically is Paul to as healthcare since experiences company business the neutral is we our strategy and quarter. the on Healthcare on previously momentum. And many or leader across positive to reinvigorating the Myriad pricing. experience, due in were revenue generated with receive tenure look a fiscal supports positioning have fiscal We all him new XXX our the discuss He I'll as Paul. GeneSight fiscal cash new GeneSight was in licensed be later net Fortune Healthcare burn executing the fiscal to operating either acquisition. quarter. XXXX, third turned medications, diagnose to CEO price broad extremely cash in its fourth slightly LCD the condition quarter turn despite healthcare faced these Importantly, join company the to to into I balances calibre year of call average GeneSight initiatives The independently of is expansion and the mitigate of I to importantly, pending positive Most This the will Kindred to have more during impact Paul qualified Diaz segments. detail call. in selling and am to and new GeneSight to for end services with the flow excited increased of to I company and cost With CEO. third Kindred aggressive year which the pleased management has from by forward at improved that, the year the XXXX, taken cash have working his expanded the and exit and over us

Paul J. Diaz

Bryan, let first kind for admirably by leadership CEO our Louise support thanking who Phanstiel, introduction. for Chair, you, you, me Thank and as Interim transition. your through this that begin management served our Bryan, and

empower progression, in this talented of rich and history, of bigger and thank of Myriad, to our like our powerful entire team period their challenge. to our patients board dedication and for health diagnose for months US importantly an reputation genetic risk database opportunity to of join developing excited professionals the we serve helping decisions, consumers the own biological physicians directors efforts and forward. patients' selections. to physicians and across patients identify as a partners dedicated of healthcare unprecedented organization clinical lives stewards the costs. clinical to unique aiding a I'd More continue assessing and the make accurately many for their specifically therapy of has and through the going and crisis. with they I'm the to and difference Genetics and information team COVID-XX and wellness. team impact improve to an inspired Myriad guiding been change continue along with information the payer healthcare make disease, of that physicians extraordinary Myriad the and management disease, disease have patients Myriad and through treatment Working these the guide tools also and can I've even by can lower outcomes Myriad payers, in the

opportunity to company transform position sustained has profitable a for growth. Our business and itself strategically its tremendous

We of will innovation the our products approach the improve digital culture our and customers marketing of to capabilities to and revitalize with sales and leverage our in look effectiveness and mind. commercial company's capabilities the

I now back in to And look products. our Finally, financial over progress with to you to opportunities future for back for financial the to results. launch forward turn new reporting and opportunity to pleased significant it you I'm today. on are growth. to plans you there the the Scott improve invest positions and speak Myriad's to of and for accelerate R&D Thank innovation

Scott Gleason

cancer pleased financial more starting outlook for trends Paul. fiscal information Thanks, I'm provide to XXXX, our on hereditary year with business. our and

in revenue $XX.X quarter Cancer the million Hereditary to of million compared in $XXX fiscal fourth the was year. last quarter

and on global Looking test of by volume volumes declined Volume XX% year-over-year at with this quarter decreased pandemic. were the pricing the of of XX% we declined a fiscal fourth baseline held levels pricing third to We early quarter revenue levels XX% XX% relatively change, declines in July. pricing pre-COVID-XX year-over-year basis. to these XX% a from the perspective, attributable ended quarter. steady declines from the test in through components the March saw have at quarter From and largely

impact impact we the significant two our first expect the annualize year XXXX another code as new transition CPT We headwind quarters in of pricing contracts. with long-term the reduction in the fiscal of year-over-year

this As Act. in a on CARES be impact cancer PAMA not the net due year, reminder, provisions fiscal pricing will a negative there from hereditary to

was $X.X the quarter Moving GeneSight, fourth on fiscal the in million last in year. revenue of to $XX.X million versus quarter

test growth, X% saw of and we the declined year-over-year. a components declined pricing volumes global the the year-over-year XX% volume at Looking from by impact From perspective, pandemic. significant by

selling prices collections for by quarter. $X.X last fourth average in the quarter were offset Test adjustments of impact we and year. selling approximate rate the and declined which the analgesic in GeneSight quarter increased declined and prices the to our in discontinuation year-over-year. by the pricing associated pre-COVID-XX partially XX% of quarters. These cash tests, more pre-COVID-XX with favorable by quarter, end this of These our by June. GeneSight of average out-of-period volume were revenue adjustments annualized these XX% was back to to in in Hereditary volumes patent in settlements a coming dating quarter, adjustments million the From will quarter revenue net as year-over-year fiscal the found comparisons we Cancer In lead run settlements $XX XXXX. of GeneSight Prenatal end However, impacted the ADHD a was a claims far quarter predominantly run improved our to leading rates. to identification XX% close million our perspective, million and The internal the settlements negatively as of of the review $XX.X to quarter. process. $X.X related compared had million

million impact third by fourth year. expect mitigate the and we $X.X the XX% the of and begin the as the quarter. pricing business, quarter as $X.X pandemic with year-over-year the programs X%. market. million As quarter improvement revenue versus Prolaris declined was of we due to was in XXXX, year first Vectra end the by pricing new for half quarter prenatal of XX% the year. pre-COVID-XX volumes in by increased same such revenue the prenatal fiscal positive headwinds and some the quarter third X% we the last implemented revenue have hereditary Vectra our see $X.X to million run of quarter year-over-year in XX% test hope improved declined in Vectra rate volumes to compared of we specifically million to the pricing in $XX.X through volumes approximately cancer transition to their Prolaris last to increased year-over-year.

in and COVID-XX pharmaceutical of quarter versus in revenue clinical revenue. did fourth partners. the the $X.X impact German lower our The to associated sale trial with clinic year-over-year activity the led our $XX.X million Lastly, decline revenue The was $X.X business to Service million fiscal leading Clinical million from of XXXX. negatively of pandemic Pharmaceutical

offset compared Myriad a basis. I'd $X.XX year-over-year Adjusted government, fourth the associated by US number in was lower quarter a $XXX with now like our one-time million absorption expenses fiscal year. pandemic were which Earnings was those of to quicker $XX expense reported $XXX.X Total quarter. sequential anticipated $XXX a the cash legal of loss volumes million the of the margins and to helped anticipated by impacted The of quarter. payments sold higher lower was to equivalents. Adjusted on XX.X% million However, related Adjusted quarter decline We development fixed million the with in the in stimulus earnings a headwind. our income last adjusted by the to were and and this in of quarter. per million $XX.X credit research positively last metrics expected approximately due the gross recovery impacted pricing other million fiscal income Adjusted the by for CARES offset expense on to the RBM ended gross compared line $XX.X million SG&A of and Act million million quarter XX.X% $XX in in the by cost third compared in and due quarter Adjusted year. cost facility business cash which million, operating fourth an expenses COVID-XX year. than and share in expense goods from trials, were in on detrimentally declined $XX.X fourth to were statement. outstanding was some $XX for clinical approximately volume basis year-over-year COVID-XX were involved margins than test last to $XXX.X quarter and were including financial discuss headwinds. a on the

accelerated the to from time Our fiscal cash year or quarterly position benefited serve plans. XXXX. associated as future coronavirus Due at in pandemic, not will uncertainty providing this prepayment which guidance million with payments we're Medicare, for from $XX.X annual for the

However, like commentary with you our trends. provide business to to would we related some current

is the trend on slightly of volumes. to approximately the unfavorable This has perspective, lower products late currently are into that on to consistent expecting seeing expense average. The given fixed improve of sold an absorption prenatal test July. the with meaningfully historical normal test of at cost cost June than XXs trends are been to From We and increase to XX% margins remainder volumes higher for better our average mix throughout quarter, quarter. high better goods continue and this but the gross performing priced we for expect

laboratories, increase employer We're planning increased provide marketing in volume. with we've sequential with and We discussions also activities, anticipate $XX a providers million employees higher expenses reinitiated as groups, testing service operating in currently anticipate on back expenses commission the to some and selling services. and bringing furloughed direct COVID-XX consistent are healthcare

working noted to quarterly call, last are on we COVID-XX launch As our testing. we

receiving late per California day. be COVID-XX plan July, to City Ohio and Our exit Mason, running tests capacity and samples began launched laboratory our labs August. Francisco, South We testing Salt August and will with Lake in run X,XXX San to and in approximately up

Our efforts. the do with goal is pandemic with testing this response help capacities to launch provide our to part national for the testing and

currently are per day XXX and quarter. provide update We the an receiving will about first samples fiscal after

Additionally, we pricing GeneSight recently agreed for on with MolDX. new test our

sales are a not on hiring the GeneSight neutral expansion the net the sales In the be We will average personnel. direct quarter, to and coupled of selling completing pricing, inside with process believe positive prices. we're slightly providing XX of reps but mix to fiscal coverage, details with new impact we and our first

updating to performance with we're our processes comply of the and LCD. the addition, In systems

the sales XXXX. we quarter, see year team be the of expanded revenue LCD, will fiscal believe do we increase this to GeneSight expansion. I will the implementation Given on of impact impact force early new from not a throughout expect significant launch In the the and sales the in

In on for coverage Medicare awaiting for terms our request of non-favorable, high-risk patients. intermediate reconsideration Prolaris, are and action we

not Looking screening at we assuming testing risk positive guidelines. our for are prenatal average from expanded or impact new care guidelines business, any

work guidelines, with on to the continue ACOG We within standard-of-care and which testing both ACMG support industry.

hope And testing the we year, end on business will average results by as transition vary recovery the by assuming full returned through year in fiscal test, the will normalized we fiscal to we currently XXXX. For of year, we the gradual a relatively a have are while environment.

While are ultimately on event. a global seeing our to this be pandemic, a clearly we impact dramatic business transient due will the

business We I'll medicine call is pending some our that, within personalized discuss highlights industry could further improve continue of profitability of key to the With to and turn to quarter. believe scale the in a Myriad number the to back well-positioned over profile. achieve business Bryan the catalysts

R. Bryan Riggsbee

Scott. Thanks,

beginning would I quarter of key Now, on the like with business discuss to our the progress some highlights in GeneSight.

LCD August clarifying There This like effective LCD, on would and quarter, highlight have around pharmacogenomic been some final which this few a testing, X. Medicare misunderstandings issued I points. became covering to a

the coverage. Medicare articles, not covered LCD multi-gene were GeneSight of any is listed recently which in and the receive panel changes to us make a the requiring was First order under the one as in issued. coverage tests is to test to

available mentioned, we neutral for Scott price MolDX. be price. received that the the selling average with a overall along GeneSight positive for the As believe expansion new to will our reimbursement We market change in GeneSight slightly to pricing for of

tests. setting United prescribe relevant States. the to in an care all medications be number who licensed licensed for new the prescriptions This either are independently arrangement the care written now Importantly, primary to a the expansion health or and where will XX% condition order of with allowing anti-depressant into the eligible approximately qualified in coverage expands enables and patients of testing diagnose by providers, LCD

are United and a not of Overall, plan is setting. a failure. LCD LCD opportunity in currently hiring care expand some the where are sales LCD to coverage market reps LCD quarter, into with only plan upon us prior to the GeneSight primary to this outcomes the sales new has of implementing demonstrated this XX of pharmacogenomic and both GeneSight inside with the we we not language product. for an from broader personnel. direct complete the Healthcare, the the consisting mix additional Based our that study, We medication a of does while test the aligned prospective ability the combinatorial large around a require in provides improve Additionally, testing

markets We greatest position the reps opportunity. in will with these strategically

key in return a We kit we further sample we of invested early the a media Based test a in for the designed on version focusing also fiscal a basis positive generating campaign, a recently the new year, home social States. pilot initiated dependent capital on in time. advertising success In upon specifically on the in GeneSight, consumer short three investments markets could collection. this marketing launched for on programs later consumer collection July, United the broader implement of

of With important in process not an swab present field After with kit the can sample, the for test of collect the prevalence a broadly our it's to test the and be a envelope pre-paid swab enabler during be into providers clear patient with kit Once to designed their laboratory kit buccal and use telemedicine it physically and ordered of is where the patient to healthcare the to is will for with physicians order is paired step-by-step cheek or increasing DNA this their who a psychiatry, the by physician, utilizes the the confidential cheek. visit. pre-addressed the puts patient instructions. from return use shipping collecting patient processing. inside the to The the easy

test So compliance far, high directly for step. shipped collection we the to sample have the patient seen kit with

psychiatry role increasingly telemedicine are working on we capitalize trend. post pandemic the this see to and currently forward, an important strategies and Moving for we on

we citalopram Pharmacogenetics guided citalopram quarter, depressive in psychiatric major This predicting evaluated guidelines XXX first-line disorder. treatments Clinical are study blood from were for who a escitalopram for Implementation that published which status. upon testing Current patients study only at taking demonstrating PXXX based study also to GeneSight research is either routine drug This cytochrome Consortium make XCXX or recommendations single-gene metabolizer new the superior levels.

or scientific predictive single-gene study combinatorial approach to almost compared citalopram with PXXXXDX blood in variants GeneSight the by and metabolism the more test genes, identified cytochrome testing the the levels role explained twice metabolism. combinatorial evidence with Psychotropic patients decreased used cytochrome PXXXXAX pharmacogenomic supports additional using in power. when However, of testing in citalopram In

quarter, important riskScore business, two published announce that I'm on our to this Moving hereditary studies cancer pleased we test. on to our

the The developing of in in was to score test, women risk. variety unit of higher known risk risk patients validation patients. breast in first be the evaluates average risk was polymorphisms cancer The which the standard of in genes the to threefold a key ratio translating at breast the X.XX for nucleotide cancer of associated X% study polygenic breast cancer higher deviation the riskScore per odds component a validation single found of top with having

evaluated Myriad's stratification XX,XXX approximately patients study demonstrates mutations The study riskScore cancer pathogenic second American pathogenic genes Journal in Medical over improve Open high common The in and XXX,XXX with in common diagnosed women clinical such breast The and breast patients risk to changes cancer of Network mutations of BRCAX the did demonstrated study in with who cancer was the as BRCAX risk published and of ability patients score the Association genes. polygenic carriers to warrant management. penetrant not that were genes. breast

PALBX However, risks as clinical warranting genes penetrant very cancer could with breast and CHEKX, moderate significantly patients in ATM, different management such considerations.

XX% historically example, been for a with mutation PALBX breast risk For have to cancer. have assessed patients lifetime an approximately

modification plans by data varied hereditary fall will this believe modification However, followed and CHEKX the plans Myriad this risk riskScore for patients' XX% the fall risk CHEKX this to XX%. after risk Myriad cancer the only patients between gene. test, validated to XX%. to our has modification from Myriad differentiate risk the market-leading launch test. to the between further clinically incorporating XX% tool vary launch risk for additional we

an may about to provide testing. will new ChatBOT with certain determine cancer support information assessment candidate AI to individuals to answering launched with they we prior genetic education online a to cancer taking Gene and if patients Gene over interfaces providing hereditary a hereditary The quiz. be engage cancer leading XXX,XXX online questions our them ChatBOT hereditary interactively our for business. quarter, named can This

live assessment certified later for healthcare workflow the technology calendar meet complete educator pre-test preliminary volume. educational further that patient genetic displays this Gene Gene counsellor. diagnostic will in in a a ChatBOT who a to process year content automate evaluation, can further for and the and Gene gives into who oncology for test We ForeSight reduce those criteria also with a increase our the finding tests testing sends and and multimedia start is link assist Prenatal option a that patient an For and launching this plan and interactive to on integrating provider. Prequel conversation the cost companion

in FDA quarter, companion approval maintenance with diagnostic a achieved This with cancer a a varying of in major olaparib. myChoice as we milestone CDx first-line therapy

both approvals during Japan expect Europe XXXX. fiscal in We and year subsequent

fetal works our proprietary pharmaceutical percentage We our are fraction, DNA recently to with make the greater below the the our problematic fetal cell-free non-invasive governments technology, This prenatal screening pregnant samples associated laboratories. testing In process and The no preferentially a AMPLIFY blood the X%. in CDx the fragments, blood. over X.X myChoice below with and X,XXX fraction which using maternal our amount partners fetus sequencing test. times shorter already analytical fetus, with blood of by we the X%, with working from local further available maternal had women predominantly average prenatal the to validation DNA the in European amplifies a fraction Prequel the increases of In accuracy fetal AMPLIFY which business, any even woman in AMPLIFY patients. of market-leading are cut-off the launched technology, of associated an the proprietary maternal

no-call the at high BMI technology prenatal marketplace. and XX% screening further United rate validated it's women, to test will samples Prequel offerings pregnancies in of lowest the the in AMPLIFY which the already We our in believe X,XXX one accurate had non-invasive States. in comprised Our be differentiate

mixed of XX% individuals know and American practice, to study for Medical American both recently of their ethnicity-based patients do with both of Gynecology. and College the comprising challenges College approximately carrier We grandparents. guidelines ethnicity the also paternal over clinical published showed Genetics of not for of in ethnicity-based maternal physicians Genetics guidelines the used the struggle screening descent Medicine which a and in XX,XXX patients implement In associated by

of severe from of guidelines ACOG genetic Following ethnicity-based the in XX% disease missed ACMG would carriers and study. in have being resulted

payers including in lives In payer a four covered Prolaris. approximately favorable payers these XX United received million recently States also the top for medical major policies aggregate, added Prolaris. from for five We

for In cancer only indication. coverage all and BRACAnalysis addition, test germline we Medicare received CDx prostate approved this for patients for we're the

return I've been Finally, inspired an Vectra what with this to through test. believe to fiscal to value new plan added launch to by challenges launched we future drive tool the physicians for Paul test of the risk to on half look XXXX. July, the value and Vectra excited new the company in the team will We to tool Vectra and may progression dedication turn report. of the company pleased second year with the and the working We with also radiographic our I'm to the with provide cardiovascular our I that, later disease great Myriad like risk positioning and American long-term in over am Interim the at forward faced the scale growth I tool call With has a Scott would within consistent for Annual CEO as it year work finish and of industry. we this about the the Rheumatology Q&A. to the of to shareholder College by honor serve President saying to Meeting. bring been

Scott Gleason

Thanks, Bryan.

of certain results and the during measures. reconciliation to section our Relations reconciliation GAAP guidance website. of today's under results non-GAAP As can found GAAP financial be a to reminder, we call, use Investor non-GAAP financial financial the of A financial non-GAAP

portion Operator, to the now we're order please for question ask to today's only ensure and our to asking Now, Q&A Q&A broad ready participants of Q&A the one begin participation follow-up. we're we're session. one ready call. In session, in

Operator

line And Nam BTIG. ahead. the of is first Please the from question go from Sung-Ji

Sung-Ji Nam

Paul. thanks Hi, taking for questions welcome and aboard, the

of terms what are taking of where So, on the – my question that. the patients to what you you infrastructure your sampling advantage meaningfully and What where expand just are capability you of and from direct-to-patient first if in today are percentage your that telemedicine is as your of curious capabilities well? currently kind with strategy, have infrastructure,

Scott Gleason

of we patients When going don't patient the got and telemedicine. the percentage where top look know in – from in telemedicine lends the well test that's this my at play kind an the itself of of to the patients, actually think like for off quarter relatively that care, standpoint actually is higher think but when you strategy were medicine and I working receive Yeah, head taking role telemedicine increasingly not there's terms physician. kit it going, of areas of actual what a the Sung-Ji, I a approach exceptionally been and big of We've obviously future. from psychiatry, to important opportunities where advantage going

And we some we It's a a evaluating probably of to talk so, but looking that things currently in number of are definitely number at area. those, strategies. too are of about early

R. Bryan Riggsbee

there, add, I we Scott's it would in at that scale to the obviously and first we Sung-Ji, GeneSight of one believe broadly that was your be numbers looking trailed to that had something And, just we deployed is and office. would I the said to we I forward. off think point returned when were answer first around question we certainly to to some that it's extent have started final as that time and physicians going XX% But the scalable,

Sung-Ji Nam

any update love GeneSight, is hear the you're if made for you any Great. And so we'd more there on follow-up making has it side private payer then challenging to make progress pandemic any the much. my Thank to progress just or there?

R. Bryan Riggsbee

can Thanks patients PBM other the engage collaboration physician we think and the them are partnerships We're to experiencing to a ways order point testing talked that office them get major this need. things to and the and as terrible for well that into made certainly that on more get I to really lot about think patients expand focused for with treatment what's question. only they the pandemic is which deploy patients get COVID continuing at Everyone is and GeneSight for Sure. has that system challenging. look to the healthcare in doing Yeah, payers, we've necessary depression, get of I but payers, well. not across further

So, nothing engaged made but progress think we've the to certainly team through is this well report certainly the I year. time, and at

Sung-Ji Nam

much. so you Thank Great.

Operator

Please Cowen. go from The the Schenkel next question ahead. line is Doug from of

Doug Schenkel

guys. Hey, – of the too whether Paul. and I level. to start or evolution to it's early the a it to your welcome take ask at question, get combination wanted Maybe to maybe addition of but the kind – Good to I board on team this of seen afternoon. wanted changeover the we've as the this And your what

your of to Maybe do that in and If that too the would hear for to likely change made to some it's that think in in to be that addition need combination lead company? sense changes sense? love early metrics but is in are answer to question, target trend there structure you

Paul J. Diaz

Thank you. Yeah.

it's a that I to get thus the and would the the So, too little I but management with far time specifics, team are into early spent committed and I've board say bottom businesses, and digital new up include at products, up discussion review and following telemedicine a our marketing really and that on KPIs to the looking would just of our opportunities. total

there a metrics reach as physicians. opportunity consumers, reach those to more new need I around there's tremendous And more build we to think initiatives well.

review I'm out new So, come, performance complete strategic with of be indicators that strategic come you I we'll the and review, that talking our to will think in we'll months that about. sure

about and that of with partner in the that business. in These a the move career I the is are, a to something example. on entire I'm healthcare ecosystem, and done I've new and board people have things excited orientation telemedicine is partnership for know having direction. my said, the about a team lot of excited And excited broader board Bryan to more that are us As members I are opportunities the one telemedicine good

Doug Schenkel

(XX:XX) but And Super look the about it does competitors there lose it's the you that I'll false overlap of of thus follow-up, little I some deal thinking reproductive, planned about Thank a like admit hasn't out it, you just counsel continuing a least relative position we the certainly gone to bit with helpful. completely bit at Okay. that, guess it when unrelated public a reality as far. target little seem share, Paul. is here, original you're business, there's for – thinking of to this

some that to talked change potentially that I product you sure exciting that's right. want will characteristics You about and position. data think make just new

attributes around the today the going of your of existing products your commercial discussed to counsel? be reproductive call things kind you what with of team think enough combination in You turn to for terms on are in

R. Bryan Riggsbee

that Yeah, reproductive readouts health the fold the we've here of is Doug, is about over time net experienced capable playing in behind space, women's believe and business that some we've our brought have because today. the in we all of on tools perfectly great ease in those of some we've that forward the as infrastructure And I and use that the think take certainly, science question. is with invested I and that it. of winning in talked we of the that team we great part offering. products studies the Yeah, challenges health that that believe new women's going believe business business that of I'll into I and have and we've

Doug Schenkel

Thank Okay, that's great. you, I guys. it. appreciate

Operator

of The go is Tycho Please line Peterson from with JPMorgan. question next ahead.

Tycho W. Peterson

XX%. levels, covered Hey else thanks. everything volumes start I'll of pre-pandemic with GeneSight, was XX% on to are

And why being push think as lagging? through it on up little ASP line on the recovery you're map volume have us neutral it their more private ends with the is channels, in sight then pricing bit why PCP is better be reset why a that help would neutral. can Thanks. a on you MolDX So trying higher to payer you or a just of just

R. Bryan Riggsbee

the XX% that in actual GeneSight Tycho. recovery I was think And more range. Yeah, for thanks

mis-stated, think I XX%. was it that was

channel. part still, focused psychiatry of some historically So, of we've the I lagged it's just where the we've is that seen others, think on

channels it's does more in-person, interaction, as for that allow potentially as I nature – think not just much than in the just And driven it person-to-person contact. much so, that of anything

Also, elective that mean the why not And I believe of interaction. that made think by reason we things. there. it's slightly the is there of that's to in With is lagging balance to some seeing somewhat somewhat really neutral respect probably – there's so, of – an nature a having you're I why that pricing, to it'll positive terms GeneSight commentary on I think is the we couple a driven be

that's insignificant you First beneficiaries the are we we're change place care paid of and significant for how expansion number slightly be a not a positive. Medicare as down, They're of not today by tests the market all, for bring couple to of Medicare price that a get with when today number believe neutral running significant the of along so not the to it'll is tests in channel. we average number overall primary to covered where

Scott Gleason

of a not Medicare number now. larger for so Tycho, patients get will paid

so, have a you lower slightly And price. claims a higher percentage at of paid

Tycho W. Peterson

opportunities? the we at tonight, how the not Paul, just would helpful it that the translates diagnostic you then Got I'm announcement of into in your necessarily back just follow just more year think job background over Paul as diagnostic I'm curious if curious, about think do you do going for little hear Kindred, see some...? more do mentioned telemedicine, about think up, And reshaping? so you space, a be it. And about kind from Thanks. you world? the could and to you How see a M&A, your bit partnerships. the just or for today, You business you where mentioned first more in opportunity portfolio you

Paul J. Diaz

here historic that experience tremendous sense first through Well, refer to medicine. my opportunity. businesses create growth merged platform to itself coupled leader innovation, specifically, say companies, as My it's through and a you and in incredible would which think that that successfully I lends for I both well, And sort an and off, attracted precision that think to that hospital-acquired bought, growth Gentiva doing growth building public varied. you. and I it's I've platform pretty Thank give to opportunity discovery private I ambitions is opportunity in spun Yeah. two equity for was market growth think a with cross-selling adjacent you again, would of my a Myriad where I experience M&A, a and both of expansion. but here

would is this I it business and the the Myriad and The and growing just model for does due like economics and great other of diligence. a margin growth investment thing for is say multiple expansion. large personal did what And for reputation a levers product as its I I underlying that trusted my from that partner I believe the thesis a are there market

focused, we're to that and sure and we be areas of and where and we're this I wide excited leader to in. multiple of we pretty in to also field things be more Kindred gives background win experience going think be me I one think good My that segments, vision strategic to So, team can on a pretty but review, focused think the other that's a at more about help examine aggressively succeed, here. can make through the those

Tycho W. Peterson

Thank you very much. Great.

Paul J. Diaz

you. Thank

Operator

The Please next of from Steve Needham. ahead. the question is line with Unger go

Stephen Unger

Hi.

quick cancer let's on, understand one quarters. may are prenatal, I couple But your wanted what Just, difficult question for over volumes forecast to over two I impacts to hereditary quarters. pricing the next negative expected next and that of be realized the say, clearly

R. Bryan Riggsbee

Yes. Steve.

in that provide I quarters year. guidance think obviously for the the or either didn't, we position to a upcoming we weren't for

think made previous then really we'll qualitative the changes year, year the into lap you point that to assessment comparisons and to relative calendar provided calendar back next the I Prenatal the come comps area. for we half of part billing namely switch first we next of made negative that, the would quarters, and and to what Cancer the – as is I in those Hereditary a code we that in the that both of products of some

– would So of drivers Cancer also is out payment think delay of the we the that's Those calendar relevant to things would I be part Act. that year. look CARES Hereditary as Prenatal be Cancer the will you I as was back the and other be factor half think think the And about biggest then the of year those there Hereditary that pricing. pricing change the

Stephen Unger

balance Okay. related from you it And the what's of deferred And Could roughly discuss grant CARES sheet Act... you that to Act. then $XX the this is million you have CARES quarter. I and noticed receive the that did money revenue on

Paul J. Diaz

that Yeah, said payments the we – on remarks the received had advance Medicare CARES during prepared of Act. from the as we had part

what to. that relates dollar that's So figure

R. Bryan Riggsbee

future It claims, was on prepayment Steve.

Stephen Unger

Thanks. Got it. appreciate it, okay. I Thanks,

R. Bryan Riggsbee

Sure.

Operator

of The from next Please question go from is SVB ahead. the Leerink. Puneet Souda line

Puneet Souda

Thanks.

sort excited perspective Welcome early – mentioned the can I just portfolio well, there times. growth others? it's know an mentioned on So of seat if the sort from there Are mean, important in. Paul, focus great first into things industry you you here just looked I'm us the is and at your diagnostic totally all, a looking have – I thoughts as broader more is aspect space. looking and I help thoughts that in share see could fresh of overall, anything anything maybe understand you here and diagnostics these you (XX:XX). onboard. you that appreciate on gets having But of to broader some versus you and at opportunities you wondering,

Paul J. Diaz

company ease-of-use and in view Again, lot my my just the outside in. our Yeah. on has great looking my the in with of to reinforced are a we think most opportunities and of diligence with change and payers it's look, opportunity sales customer historical strategies. great more telemedicine, execute thorough about dynamics And the and solving and and I of to that the around got and to how we to my tradition; digital our sort way. have from talk service some But observations better, terms a marketing reputation of both We've management discussions whether a team marketplace pretty pricing the re-energizing partner preliminary the and physicians and marketing really begun that and more consumer-centric in approach standpoint. we've

there we products of about lot efforts. in which capital better. So those favorite And I said can my to new will come look really as lead of how there's go OpEx a manage excited can and so think I costs of and choices bottom can both one we that top figuring the and think which we we to growth of perform those focus opportunities, through on those out are doubling and of team we take that's a and and of reprioritize better, management where organization the the fresh strategy to opportunity and is people markets examination down where in

Puneet Souda

here that? samples lab Thanks X,XXX you great. elaborate accessioning getting day, if these reference COVID or could from you appreciate Could that. them get per if the I'm or are could I bit results? actually but turning and wondering running testing. you samples yourselves these you pricing on clarification to samples you're another could get That's a I just maybe on – just Bryan, for of

R. Bryan Riggsbee

Thanks, Puneet. Yeah.

we we folks and which the to demand continue some significant built have, will flow labs up with in for for today that of in a because where in sample don't and reference think out we there's we obviously, keeping market grow. for the struggles read demand As we we type X,XXX others of some network to said have. terms would some to many hope in that of the of testing earlier, the sample you've collection to Relative get the obviously large about are the market logistics the capacity have

other at So bill lab and also are that reference other effectively. – us to this send it bill and for via from point in providers marketing other client laboratories would samples are we samples coming would

this that's Did point. that so And is question? process at the answer working the your way

Puneet Souda

are that wanted to price, just I it's able extract than you to rather Yeah. complete that And sure make (XX:XX)... $XXX test if

R. Bryan Riggsbee

testing. and would the to the do Yeah. it it billing into We result return They would They have send us a cetera. them. to come would et laboratory. for It accession would

the process that get So would of you scenario billed you some get had the smaller for test. full you running would not that just price, in the negotiated amount

Puneet Souda

it. Got

Okay. Thank All you. right.

R. Bryan Riggsbee

You're welcome.

Operator

Derik is go ahead. Bruin of with America. de Please next of question line from The the Bank

Derik de Bruin

Paul, of Good questions. afternoon. welcome. couple A Hi.

to pricing So other your coming commercial United one your MolDX you're how agreements? the negotiating? of paid you're potentially to does the impact contracts from get any this what this first does your down, is impact for commercial going or that does How – potentials tie

Paul J. Diaz

Yeah.

outside in that contract just I impact we other There's is of agreements. re-signed back have doesn't no that. commercial don't payer would January. say and So the guess, impact thanks, Obviously coverage broad Derik. what it to agreement United I cut we

talk at really not there's say point I this would a there. lot So to about

Derik de Bruin

the you has you ticked also up sort – the about in have process just what wondering I'm talked how those what are uptick Got is some haven't increases sort sort it. the – And pre-authorization of been been? of just on United, of of of has GeneSight. the seeing for pre-authorizations sort

Paul J. Diaz

all for for know, space, Sure. and in of you really key payers all testing from our Thanks, we deal and products, what so it's there's most prior authorization the as use say had we've a to there. follow Derik. to no process our would in I is with change for of have genetic general historically

time you get – of have go your a improve period through adapt better. something know any yields as you you for We and and you time

we as so characterize But improve. additional And have continue prior it authorizations or that change to been put I would for no look of to in areas there's opportunity place.

R. Bryan Riggsbee

authorization outside the GeneSight And flows of been Derik program net of prior our trained. getting cash progress We quarter. for positive saw the claims we've highlight, I making on would we did terms physicians mention in in just of that settlements fair

an important point. And that's think so I end

Derik de Bruin

you. Thank Great.

R. Bryan Riggsbee

Derik. Thanks,

Operator

Please go The of Jefferies. the from Couillard next line Brandon from ahead. is question

Brandon Couillard

Hey, cost different curious for at home the collection GeneSight given economics set Good collection sample using and of could afternoon. are that you Thanks. materially the Bryan just the speak added if approach. to

R. Bryan Riggsbee

consider I It's be material. wouldn't a significantly. It's impact swab relatively it for the of it Yeah. to doesn't Thank straightforward. cost you question. and just the test the cheek

Paul J. Diaz

Brandon kit kit from a send physician's standpoint we'd the the still fulfillment well. to as office

well that as (XX:XX). So just different so doesn't difference for cost it's a format the kit,

Brandon Couillard

reps many beyond how you and and Got initial reps? scale future you. that you as you remind partner the sales market, how envision force ultimately to the do think do as that XX today will GP force expansion, about And a far you into growth being of GeneSight sales us have

R. Bryan Riggsbee

thanks. Yeah,

number I XXX. was the think

Paul J. Diaz

team is reps, reps, XXX about sales XXX psychiatry The Brandon.

R. Bryan Riggsbee

Yeah.

terms in initiatives. and important, outside talked inside going that obviously we about I So mix I of how forward think direct-to-consumer We we initiatives about think our a thing about people. think and sales is digital talked of one our

our evolve the we I some see and to sales side our So the just think physician that with interact that of you'll on thinking the is how consumer and we customers. things as one start

how continue and we'll time we're market. force how positioned evaluate market think and in our the just I over sales to So to we go

Brandon Couillard

Thanks.

Operator

ahead. the Meehan question go from line Nephron Please of is Jack Research. from next The

Jack Meehan

on congratulations I'm you forward Paul, and role. looking again here. with you Thank to working the new

Paul J. Diaz

Yeah. Thank you.

Jack Meehan

back to GeneSight. go to Wanted

What So patient be previously test. you average your your will around $X,XXX do per collection pricing expect was new per the policy? under

Paul J. Diaz

different the Yeah you detail. well. level little is price not bit there for as what actually than stated providing rate Jack, Medicare of The actual we're a that

we're And the we're not getting so pricing for into around and the detail quoting how test.

Jack Meehan

was to order that for documents additional in documentation some to the in stack genes sure become LCD plan, to are justify with that curious be sales cause Okay. The codes you to test, genes language that you've that physicians that heard multiple your the test. And could the you're doesn't that what going they're the team ordering are in I doing feedback a suggests us make order that to around required? for there's each challenges and going burden. required the each for what's

R. Bryan Riggsbee

welcome Glad Thanks Yeah. you Jack back covering.... for back. to question the and have

Jack Meehan

Yeah. Thank you.

R. Bryan Riggsbee

Yeah. just have The is we're terms agreed with we'll and – we single a with what so the respect how to point with team I stacking so instruction excuse – question. I Medicare billing this cetera. given in test bill, on to would with for for on and product say last clear codes of respect to been think at billing are me, how the your sales respect We've the et to follow-up price

so direction clear and really have there. for Medicare, We change no pricing

be a complying LCD. there and happen of training exactly point, other and – disruption how in the the educate that the is physicians with relative to some that following does tend the you requirements the change requirements any that to see on requirements should think they has there to training I for time the physician, be to

So become team at something the that's has also process. that pretty that think but I it's pretty adept normal, navigating

it's to disruption X would that team would it through. so, heard not expect on would new, work it was the as I this effective something that would relatively is you be August be about have but some surprising And date, able

Paul J. Diaz

depression, medication a documentation and around changed, that that around they pre-authorization physicians provide the had That show had documentation treatment-resistant showing requirements from have and considering it's we Jack that. new had the more medications pathways. patient are just that the And gene failed Previously, standpoint, requirements the that and interaction really follow really previously right. drug multiple to

a just or providing a level, type we're really documentations. different of so And different

Jack Meehan

it. I in If Got follow-up. can one squeeze

combination neutral should of a to these factors, You positive. be mentioned

we're the decline Or baseline sure the are that revenue to make the PCPs to versus to relative relative price and size million What's referring more of is thinking of XXXX. it you're in Just about you using, with $XX right. market combination. the the that

Just what positive? were neutral you with referring to to

R. Bryan Riggsbee

Yeah.

the I will market think the when with to look MolDX were of said LCD pricing we updated that about from That's the with along care positive, of a the primary expansion respect neutral forward. in to the combination we segment. talking going how

for we we've mentioned tests will on population As there zeros of be historically there's that a and the that now call gotten run covered. earlier,

GeneSight overall expectation So that is the that ASP. of go the there's number sort to slightly is on But that things all of a positive of that. net into our neutral

Jack Meehan

Thanks Bryan.

R. Bryan Riggsbee

Jack. Thanks

Operator

questions other no turn is closing it time, There remarks. I'll back this at for any

Scott Gleason

And concludes for earnings website replay this one afternoon. this be our you on will via again week. webcast for us available our call. A Thank joining

Operator

your conclude call the you participation. today. thank conference will We for That for

can You disconnect now your lines.

Myriad Genetics (MYGN) 13 Aug 202020 Q4 Earnings call transcript