Myriad Genetics (MYGN) 27 Feb 242023 Q4 Earnings call transcript

Company Profile

Participants

Matthew Scalo	executive
Paul Diaz	executive
Mark Verratti	executive
Scott Leffler	executive
Casey Woodring	analyst
Andrew Cooper	analyst
Jack Meehan	analyst
David Westenberg	analyst
Mason Carrico	analyst
Kyle Boucher	analyst
Puneet Souda	analyst

Call transcript

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Operator

Good day, and welcome to the Myriad Genetics Fourth Quarter 2023 Financial Earnings Call. [Operator Instructions] As a reminder, this call is being recorded. I would now like to turn the call over to Matt Scalo.

You may begin.

Matthew Scalo

All right. afternoon, Full to Year good Fourth Myriad and and Quarter XXXX Michelle, and the welcome Genetics Thanks, Earnings Call.

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

Operating Chief over in XX-Q or and actual important from reports Paul. statements. the the a future We you or These at company's Exchange Officer; that are Our and along Investor materially Form our from slide contained files presentation. current performance risk Form to with the and can investor.myriad.com, could information Securities annual adversely Leffler, report quarterly Sam specifically, the differ the Relations, Scott its time call now website its investor.myriad.com. that and of documents events turn Mark projections forward-looking section can results differ the of expectations on actual management's archived results Officer; Senior Chief webcast recording with be Scalo, today this cause company. our X-K I'm on on on and on or the and forward-looking Form earnings other Matt Chief Financial a Form projections issued Paul Investors found reasons. and Commission Vice the Chief or website, afternoon on President materially be Officer; regarding call will was Verratti, I'll may reports statements are events ], these Commercial Officer. from at documents factors to Raha X-K. statements some future release presented the company our Executive note Diaz, and XX-K, this and variety our via be current expectations those President . Please of today financial our on for in our based the call heard to of These identify contains the [ quarterly live the refer time This of our to

Paul Diaz

afternoon, everyone, to highlights us. Matt. our continue year-end call, and progress the growth. joining we accelerating Thanks, thank revenue the on and fourth profitable discuss performance we update quarter make, and provide for from you an today's Good On will

here by their Genetics thanking before. added the more Start ever as the team's Despite to in Myriad delivering this patients we more year. was we on XXXX, mission for team than faced our at commitment efforts challenges serve our evident customers and

slide, Next please.

and detect to to best-in-class treatment support are decisions clinical goals disease, to overarching continue improve develop outcomes. better Our diagnostic molecular tests

the and of and patients improve by to clinical lab ease and test utility Second, and use affordable more genetic partners our scale and accessible in our technology our and commercial operations. leveraging for make provider

become our our to part us On better alone adoption we a you'll care integrated are patient-centric our friction products not that X, in solutions and endeavor genetic data and Slide of expand and address allow points us partners health create help that tests. to and as access more for system see industry

and health technology system continued few and expect care innovation these growth. to next build to the Over partnerships we on years, drive

the to released next results and quarter now Turning slide. full today on the year

guidance adjusted revenue year. And to we as last commitment the positive EPS and achieved to mind, than EPS deliver growth We our compared to increased achieve and performance this cash in quarter. XXXX double-digit pleased fourth shareholders as to gains in introducing our profitable continue are market full on year strong positive XXXX With adjusted XX% flow revenue adjusted total well are we share raising that in guidance. positive more as we operating

$XXX our which million equivalents a and strong XXXX in successful securities legal $XXX enter position we XXXX, puts our of million cash on November of the to sheet business. raised from no balance with offering, equity and overhangs In marketable

Next slide, please.

As medicine genomic have sales tailwinds precision ability that testing providing adoption in see deep for to and strong beyond, the commercial cases for we in. we an products, we sell channels look across growing, our across use XXXX increasing core organic with towards and profitable growth roots

At we providing but gains. top among would that is XX% with is market not share opportunity with the us same fragmented highly time, for it days share precision remind concentrated early only than medicine investors for significant the it less players,

we this excited that breadth products strategic liquid Intermountain of align month precise to tumor XXX% unifying oncology our of our these solutions Genomics, Precision platform. from and bringing to economics precise of these oncology are offerings with We acquisition the our of under capture the the and in-house, options our priority expand expect testing precise us oncology allows with

Precise We the year, of launch operations, year-end. tumor to QX from campus this our plan moving in of rest West liquids IPG facility precise by acquired including the with lab

We are the excited to employees the welcome IPG Myriad to team.

the first PLA our and had in expect at the a RASP the that compression in XXXX. health claims of the XXXX. support scale issues and addressed and in to transition in our to lab that code in as year pre-stated our impact payer Due saw these in XXXX, X% foundation GeneSight's target office new so of In compression half operations our profitable revenue hit as XXXX we the collections beyond. year plans pre-stated range. we start lay processes to quarter full issues, a targets, of to 'XX, adjusted administrative growth profitability did accelerated below Over our we improvement and back and Having XXXX, ASP Blues we of or to higher-than-average negative multiple course X% fourth at ASP transitioning above well at in X% on continue and

we years. have few guideline and in Looking we utility starting with believe clinical made will years, of see evidence the over bear investments clinical improved body support the that we X emerging the an forward, past and R&D over expansion, fruit to that reimbursement next adoption

highly collaboration test tumor says, MRD diagnosed the a for research with To align "this in the scope he projects". announce ], National Hospital Uchino sensitive, WGS-based cancers. Cancer to has East, use potential precise East with We Hospital the patients when wide excited were solid array of with we morning, Center to This a [ of our revolutionize study MRD Deputy hematological of Dr. Director Japan.

pharma we precise MRD forward turn expanded XXXX a growth XXXX launched first to I'll behind continued it use genomic gene Plus, comprehensive With and for screen over look with us, Universal screen, to carrier into strong and now as panel multiple we prenatal Foresight research Mark. our partners. precise liquid

Mark Verratti

start oncology on Slide I'll health, focused women's pharmacogenomics. on Paul. and Thanks, We XX. remain

business our commercial transformation a our an product as on unit, call, I the of development snapshot update well will On share as and performance efforts. XXXX by

On all strong core products of we in double-digit a Slide XX, saw growth XXXX. across our

teams will our we thank level plan As the Myriad, to of come, share delivering in of leader will continue and success. growth to XXXX. this for will in part I this how slides their momentum commercial I In company sincerely commercial the

transformation Now deliver XXXX. business our driven creating on success to I insights want across By enterprise-wide Slide company, capabilities in the to the we efficiencies XX, that and data provide consistent and enterprise performance. has using on optimized update unit our commercial an have

leverage marketing have in also operating and overall commercial customer our We drive to digital targeting, XXXX enhanced and beyond. model

Next slide.

the pharmacogenomics GeneSight in year. GeneSight growth In grew of for the over to first as year-over-year, over volume fourth approximately our quarter, new XX% volumes providers the same added course while we commercial XX% period. XXXX time XX,XXX the Continued execution business for grew record-breaking the led revenues ordering

costs. GeneSight's to strong We multiphase understand look study the continue We foundation including study to data, reduce build better the care a Optum GeneSight's to create this collaboration to the design clinical second of clinical and improve updates sometime a ability in on of outcomes with half health forward Optum overall year. on to

women's demonstrated prenatal same the team fourth volumes And excluding by the is XXXX women's carried grew volumes year-over-year. that over health quarter, grew period. In strong hereditary XX% through after XX% SneakPeek, cancer momentum The our health the testing results.

Finally, we in forward response. Foresight upcoming ACOG eagerly guidelines rolling and out Universal to include carrier to Plus expanded look the screening await

ended XXXX a Marriott's on strong oncology note. team

testing to fourth increased As in volumes X% the hereditary quarter compared last by the year. cancer

with our offering patients. liquid that enhanced the myRisk the oncology to quarter combination to Prolaris of in Prolaris, of and precise XXXX also provides testing XX% Precise prostate and revenues in depth fourth a portfolio compared The with XX% our [ ], diagnostic menu. add to urology increased addition Myriad continue We've cancer expanded for the information We to the JiraSuite tumor prior. year

Next slide.

we compete As investing use to the testing we're tests. different across Paul spoke We our menu, win infrastructure, investing clinical and our everything our while and products. and data newer in test in note channels, develop of it's investing IT, breadth else depth, important that of enhances to are which earlier the clinical chasing utility not our that to that in. something is And just always our

-- look how want at a future our to give coming I we the our see together. of Finally, brief how tests

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of to the and patient continue to remaining exceeding more focused. challenge they goals provider reaching and rise patients, As our

call Now Raha. Chief I Sam our over the turn Operating Officer, to new will

Unknown Executive

health I the earnings call company's for well-being and shape believe market here my all opportunity in I'm Thank with positively impact lives. to advance first Mark. excited diagnostics Myriad patient I'm energized be you, the molecular today to to have for December. we joining significant and this and mission since

Moving to Slide XX.

growth. annual measure finance, categories: and growth, measures start productivity and profitable performance with quality, enterprise-level so basis. a tied on doing five and near- me strategic for actively our and track We people, quarterly to Let long-term key driving important indicators

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our we on gains functions. lab commercial, technology initiatives and are and track focus in increasing operations productivity customer-centric expanding how our We

slide. the Turning now next to

Let highlights me touch on from select XXXX. operational

organizational to are high a proud across have level company. the of engagement We

With We a to designated of place work. been our strong team endorsement have their XX% Myriad. indicating of great

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next the to slide. Moving

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management actively at in technologies the results our invested treatment Again, to Slide significantly focus to by that and patients. provider in is This investments make deliver enhanced to it for to to technology-enabled foundational system. receiving our us. projects improving in Digital do value are settings From have customer experience. portals now integration implemented slide we that EMR real-world and enable projects ongoing order are better invest supported learning Moving clinical unified business easy-to-understand with to easier our illustrates And patient patient to to providers decision products, Myriad. about XX. tests being ordering

to new capability programs Finally, on and including progress the of in been our update on. facilities hosted San South We let we tour and City completion month, in have investors our investors us. who map this Lake infrastructure me our you Earlier hope Salt at road XXXX, Salt and a for made we Francisco to visit focused new City. more enterprise-wide of Lake significant facility see want

XXXX ] XXXX. prenatal [ NovaSeq completed We also products sequencing transition the to platform of in the our

the over Lake X,XXX and more acquired our integrations locations EMR moving Salt West successfully than Precise in assay our City as locations building also from additional recently focus MRD an XXXX as our Tests Tumor XXXX. we well on facility Our includes added XXXX, Precise to Liquid that Precise expected X,XXX in the

these investment, times, form the lowered we return And let significant turn which differentiate Financial of over customer All competitors. Leffler, newest of and that see are me and require to now confident in us test Chief programs it we Scott positive costs turnaround operating a will our continue Officer. executive, improved will to our from improved our experience.

Scott Leffler

to with excited and company's and earnings profitable Like with to advance mission my payers to the for Sam, drive of growth. call for attracted also and here Myriad services Genetics. I'm to I first to opportunity own sustainable Myriad lab my experiences the be for well-being leverage both all. and health because was

execution testing, on begin high and our growth and several consecutive of year-over-year a XXXX, sixth Myriad's quarter improving team that double-digit delivered of continue in our growth as to the the factors, prenatal review quarter about we cancer This most such from growth Sam with recent market volume we In to and This volume performance experience across Mark year-over-year Slide grow key that cancer, marked talked volume hereditary estimates. XX commercial an discussed. positive at drivers. end We'll hereditary speaks of growth pharmacogenomics. customer strong

XX, throughout to our Slide highlight financial On quarter performance want by XXXX. I

high goal financial generate financial and in results profitability adjusted As $X.XX million an quarter. to and of cost our the end to mentioned, flow guidance $XX our all delivered on compared units the full the operating our three EPS Paul of We in in quarter. year basis growth fourth management. in achieved business adjusted disciplined remain of XXXX our revenue and positive contributed positive we cash adjusted our of which to XXXX hit

be QX year While QX being single-digit as growth to this expect year. concentration quarter high to of revenue biopharma year. year-over-year progression the tend due last expect year to That during in the EPS in We spend, quarters. in subsequent commercial to compared from in for seasonally a revenue a we seasonal reminder, operating of expenses timing resulting growth to pattern, case, increase a adjusted revenue this rates mid- then follows of higher in in Also, typically we benefited XXXX. of percentage only negative certain first QX of the

XXXX includes a equivalents borrowed $XXX million marketable QX. outflows in seasonal position strong approximately balance capital finished as in in expected facility million asset-based ahead Our sheet $XX from with cash, and cash securities. we of balance our The working drawn

especially a QX made to cash operating million. change operating compared have adjusted cash improvement in flow in flow step positive was We XXXX, during adjusted XXXX $XX when

significant with have of are benefits case, that in Most reductions we of are believe real adjusted beginning the investments progress those lion's addition, see XXXX the our In to behind that Sam mentioned, have and out sight excited categories should line as being share initiatives are our operationalized. of estate we and by transformation the costs assets That been we the beginning importantly, cash to non-GAAP metrics pleased us. realizing investment of we those XXXX. more as the have of of fully in those

with year. made expense discussed provided Myriad last to significant the adjusted guidance on today. On financial margin performance Slide overall progress year all XXXX ranges gross results This XXXX the for fronts within revenue financial here in offered full reflects full initial year operating a positive February ago. XX, Actual initial actual compare the initial we exceeded revenue of our XXXX year and XXXX range has

business regarding company's the the grow overall to XX, forward, and trends growth above we we looking Slide guidance. or at ability XXXX is why are revenue year which full industry rates, are our optimistic On increasing

was As mentioned an earlier, XXXX of strong unseasonably comp. QX

rest accelerate XXXX to So over is single-digit period. at mid- prior quarter a XXXX. grow through rate first and to revenue the expected high year percentage the of

expected margin focus gross product basis pricing over XXX given XXXX points expected trends is growth, operational XX ongoing between and excellence. to and XXXX on volume our improve mix

levels, lower to ramp With between expected operating are the fourth margins and grow expected throughout be gross to typical adjusted quarter, year. first seasonality expected to than For up are quarter reflecting X% loss expect expected bottom line to with the and a EPS 'XX XXXX, year positive full of see in XXXX. $X.XX X% drop to adjusted to leverage versus operating expense we be for

we for potential. cash-generating a in year, we are Myriad's believe profitability useful in adjusted to a guidance with and both This trajectory also as which be EBITDA underlying introducing for XXXX. understanding metric metric investors We new will respect our

$XX between For million. be full $XX and XXXX, to is EBITDA million expected year adjusted

our we projected normal expenditures September and in are aren't at to investor levels that guidance, in at CapEx expected While capital return consistent made to formally million million $XX the our approximately for event. commentary to closer with year I'll note including $XX XXXX, XXXX

Now let Paul. to back me turn the call

Paul Diaz

welcome. and Scott, Thanks,

We growth technology, products continue year. detection pillars their providers decisions in of to strong treatment build and better clinically and value profitability and on our that our by settings has deliver enable this and clinical results real-world for supported patients. long-term differentiated early delivered the

and Our advanced are and improved workflows, modernized are turnaround reduce automation in costs. times faster yielding and lab commercial where of examples operating investments technology engine

sheet vision support it manner turn I in more disciplined we precision in to accessible. to forward, testing our deploy and mission a the strong will for in that, ways Looking and will make our over enterprise With medicine balance genetic Q&A shared

Matthew Scalo

and And reconciliation to certain website. reconciliation our results non-GAAP Relations the under to during a non-GAAP in financial can financial a Paul. GAAP financial today's section of release reminder, as guidance and be use measures. GAAP we our right. non-GAAP of A of All call, Thanks, earnings the Investor found

one now are we participants ensure we're begin the Michelle, and one to follow-up. to asking call. please ask session ready broad participation, the to ready the only we're of for Q&A portion question Now Q&A

Operator

[Operator Wolf first Schenkel from Instructions] Our Doug Research. question with comes

Unknown Analyst

is Schenkel. MRD. a for on releases the question path Could reimbursement? about actually Babington This got you I've forward for in timing [ ] Collin any and of new updates the Doug give data

Paul Diaz

the really making in proud this that We Yes. release. press We're the the the study. of we're progress mentioned in study morning

really of and have We analytical indications, call quickly, we all pretty the with validation Anderson that out all from really labs and the to melon expected and advancing progressing are well. Kettering the sort but well well to readout and progressing not specs studies, -- MD as study expect. they're our those of the the ready also

extent, of utility take of the terms think In reimbursement, are be follower. made really progress to some here and to fast and going clinical important we're which I studies building to working to use the reimbursement. on others going advantage that those a cases have We're be

And there so efforts talking about. different number in be regard are that that we'll of a

going So we'll into we're commercial research with to year update later expecting as launch come. more months we'll in MRD, including on operate well. 'XX a do that and the to in pharma IP the freedom our the following studies this But have to

Unknown Analyst

quick follow-up one there. MRD? given any the concerns patent in Are Just landscape there

Paul Diaz

And quite and operate. in and we that freedom these spoken our platforms patent a We confident back. existence as processes are technologies We've on in to and been for to protected systems before. are way have built existing

have in we large what great going to most participate when MRD sensitive market, of confident assay very opportunity and accurate market and to is for that and a a be a we're able we'll highly come all. So we're to patients

Operator

JPMorgan. Vatnsdal Rachel from with comes question next Our

Casey Woodring

Casey on Rachel. for is This

growth in share the XX% of So screening look guideline to strong potentially does updates of outside that in the guys quarter upside much been sustainable carrier would you later terms runway in how another seeing 'XX? on that gains strength start like this wanted Curious What have provide? volume prenatal. year is with XQ SneakPeek. I And how

Paul Diaz

Yes.

share dive we're Mark the that fair are dislocation and team, We're customers of about in of and and health this really making, the pleased new our both of been we women's there's health share women's in terms into share seeing certainly some space, a market and new Our more. gains. can lot customers Obviously, progress wallet

hopefully, terms as you you and out carrier of gains FirstGene So come continue. as also our upside, see volume ASP we add? screening, noted, well. those this guidelines do significant Mark, of will to and as year would launch, And we both that later expanded for expect be in supportive

Mark Verratti

I momentum XXXX. the really No, think Paul it any we in don't I best. We think of about coming see when don't think headwinds said out XXXX.

stated an many we've actually in is market. low. think it underpenetrated I to cases, be awareness still before, seems

the hereditary is And think so that about in cancer OB/GYN the on especially you when the side channel. unaffected

And so customers as due expect continued from to XXXX, into depth new going back driving we as earning in well the momentum dislocation. both this

Operator

question comes next Cooper Raymond from Our Andrew James. with

Andrew Cooper

being like just a the little was the maybe for and appreciate we you it at GeneSight 'XX. to comment where on Thanks question. pricing of segments XXXX. continue that do low kind is for about end looks a lot could that more more gets or Just pricing the a see more challenged little of largely maybe better I headwinds how of the terms I build bit break a first, part XXXX? think for bit of in hereditary across hoping stable after Maybe as bit you what down the

Paul Diaz

mean, lab and hats operations volumes. our that Mark again, a the teams despite commercial year. with folks Yes, good And the I again, and in kept off headwinds, we really to those had up Andrew,

tough obviously, the look ASP, to blues but another GeneSight, into. we see we the of that, we going for improvement the and with volume opportunity I a blues that low-hanging states payers, made FirstGene. we than transition plans, cash now would the coverage. by market, market coverage and the is I expand year a half But in mean, of collection back more year. don't lot the up the have by in with the given piece plans, have dislocation there. biomarker issues laws XX on ability for to So say us any It's with fruit up made see of

in XXXX We cancer, saw GeneSight, for here opportunities ASP hereditary for So see really prenatal but year probably and across Prolaris. in than strong Prolaris, portfolio, ASP a and really we the XXXX. especially both less product

Andrew Cooper

forget was in Helpful. slide to press then just release, word Okay. did it the I relaunch the I And notice, the or maybe Precise -- if Tumor. deck next

Just maybe about set some you the when of the and and color you a kind bit the kind together the how more opportunity there? have the parts. of of And do tumor on do the how broader of and being liquid moving changes portfolio that of and rest then parts little think of it sum MRD ideally than of

just would thinking I of individual pieces really some on latest your love can are So today? sort opposed how broader that to that much as there of step-up portfolio a mean

Mark Verratti

Yes, thanks.

at accounts. a I And is they single Mark. answers standard their health or the it excellent of think always and they when the treatment been more patients. when you their can Historically, think answers think comes workflows it's that an larger test. time This where question. the you they're more, to for as systems because having of known Myriad many same think especially making want really it They has for I easier. provider are germline makes decisions the looking all ultimately, as for And gold

that's health for liquid do tumor, what of terms in to. talk want all you in systems use we Sam, first care round of the So mind precise to the to that of to that that really the add to precise ease that? being doing bringing on Myriad operational Sam with we're out portfolio. eventually talk will in and Combined MRD, side going is

Unknown Executive

that hereditary down our definitively the our we on Thank through the we've the major MRD. providers and to one this on very covered, unaffected the you, really with line way customers, one MRD, cancer know really offerings. nature us care what of to from of way which slides the right, Building monitoring building Mark all I health allows And of drivers touched selection said, systems, on Yes. for participate of therapy is Mark. all Precise and really the comprehensive the

the that now. Because that way the I we all in think a started will with has it us excellence, we're that capability, how foundational be do talking to industry going doing samples been We're of that, also through the biopsy important. portfolio. about collection we to have But myRisk has also think liquid, really that sense is -- been decades, scale at it tests So through Myriad, almost right? infrastructure part gives in assay listen, this from all liquid across very and differentiation which we the are the for at differentiation the have three our we've process

Paul Diaz

And lastly, Andrew, with say X I that us ago. just having we're would wouldn't talk now health a meeting to systems months

an And so a we see from, come that health system strategy. as know. I world you really That's emerging

because and up, are wounds. and some quite the are really up portfolio providers built we've specialty the opportunity team frankly, out shut years. self-inflicted own across so a LifePoint to a And Those oncology will think whole of opening for we having to some systems pharmacogenomics. infrastructure really us. what first And great our like centers country. we're our Med be across we've a from also of in in Intermountain And lot prenatal many that, to been medical of academic conversations doors Simon just bigger much for

Operator

Matt from comes Goldman question Sykes next Sachs. Our with

Unknown Analyst

Matt. throughout cadence provide the the on you ] [ on year? Prashant OpEx Could for This color is quarter. Codan Congrats some

Mark Verratti

that was Sorry, What? OpEx.

Unknown Analyst

Cadence progression?

Mark Verratti

or So you're asking about XXXX XXXX.

Unknown Analyst

XXXX.

Mark Verratti

relative year. that, made well we provide then it certainly as does we're the Yes, going QX specific beyond But normal you reference seasonal to and have some follow a to in typically from of a seasonally QX on there comments prepared level XXXX not patterns quarterly about basis. And an throughout see sequential elevated elevated fact could that the CapEx the guidance.

Paul Diaz

Yes.

managing COGS the think team I on you've job just seen do think that as is the in the lab really thing add a only OpEx. would I I well great as

continuing actually to even You and course to really as down the do competitive. saw over committed keep other and our wage teammates things, the we're we bring address to us for rate issues people that of that year,

So to build we've continued R&D. on the just more more as investing discipline we're in OpEx even

gains, and the clinical in to So things find advance Dale as other investing we're more portfolio. shop we studies in productivity

focus a ours, disciplined be approach, So it's but continue about. to -- of Sam as talked it a real will

Unknown Analyst

contribution, provide in 'XX it. year? then acquisition implications And can for revenue of for some you the from just and XXXX color on both XQ the Got cost Intermountain

Paul Diaz

to you're we because speak really sorry, you. have to I'm going up can't hear

Unknown Analyst

Sorry that. now? you about Can me hear

Paul Diaz

little Go A ahead. better.

Unknown Analyst

in you can from full acquisition 'XX contribution Intermountain color cost provide XQ for and and XXXX of both revenue implications year? the for So XXXX on

Paul Diaz

number. Let if me I give specific that see you

I think it's modest.

So for business have certainly of probably the have the pointed all hit we've we're And built we a onboarding. OpEx we'll that Scott new costs and transition costs that heavier because as guidance. integration in will out, into QX

$X probably So whether So we've hopefully, new -- Intermountain we're bring investing, market OpEx customers keep on on to investment Genomics. on that spend to try But we're [indiscernible] new and the an returns or million integrate Precision it's that's high helpful. large we'll for integrations extra got for customers EMR

Operator

Thank you.

Jack next from Meehan Nephron with Our question comes Research.

Jack Meehan

wanted I to hereditary testing. cancer ask about

is hereditary the just is you're year, about pretty fourth seeing sequential Can historically, talk testing. sure cancer I'm sequential but quarter trends though. seasonally volume this strong a quarter you in this fourth in quarter. the right, So a the if the Not calculating decline

Paul Diaz

saw year off a cancer in That's health in was incorrect, strong Jack. strong women's QX, pretty 'XX, from and you pretty well. really And growth big base is and in hereditary as the prior seasonally, it the

and underscore differentiated product, see frankly, organic gains. a issues. of of having is process bigger not volume just of 'XX, was quite ASP those in very some hereditary challenge addressed with market And issues we our with different was about excited work That work myRisk clearly me we cancer couple but and on opportunities through a depending are payers growth coding accelerated ASP share the of both we highly there. factors, the as a So lots test that let very in

GeneSight, everybody out when pasture. like just I hereditary should thought company, the joined So cancer, put be to

proven incorrect think assumptions I now an we've that be to set here. of

Jack Meehan

Okay.

I $XXX,XXX. So fourth at was $XXX,XXX. looking But deck, just women's the in health it the quarter mean, prenatal. Last assume volume it I your quarter, in was

Unknown Executive

the the handle strategic can specific off-line, about your issues don't team call. Why we numbers have -- have I'm you more after sure company. questions numbers for and Jack, take volume your or If the we maybe that model some

Jack Meehan

what Can margin the fourth they've in earnings one basis XXXX. the Yes. call. XXX Maybe gross to considering downslope I in you wanted here XX been quarter on just guidance points to talk since Just Sure. too. XXXX? confidence question you financial questions the expansion on address your of gives about

to So this what's to back going expansion? move

Paul Diaz

I we last that's on have maintained We've don't gross XX% correct. in for gross mix, to margins our in that quarterly product maintained but volatility there's think and we margins see range of X.X the always guidance XX% depending years. within

numbers you're reporting. that sure I'm they're Again, numbers same looking So Jack, what but we're the not not at,

to happy you. we're through go offline with Again, those

Operator

Our next with comes Westenberg from Piper David question Sandler.

David Westenberg

exits questions. two can, potential noninvasive BRCA Can just I'll the some in maybe prenatal testing. quantify have ask in I discuss, some of just both in you if health here. actually you upfront or and women's

guidance big a contemplated guidance. competitor you upside in If or is exiting your if your to that

in contemplated coverage much And if the -- guidance then at tell you or time. screening think carrier do same screening. carrier that's secondly, when really I expanded should you how you in know fast get can both along expanded can about that's them how And for anticipate we with ACOG? then and you anticipate

Paul Diaz

Those very thoughtful are questions. really

celebrating struggled that as So to that pretty of access as prenatal have companies, think And the see still have we last of hard year sure think and several happens. a working both companies, It a sort that do are and sure that over testing. lot everybody this under patients have is I market. mentioned been we to there marketplace. And is smaller all said, struggling I fractured something in I make the that, make unfortunately, we radar want more and our peers of -- cancer hereditary are our we is not the that before, some disruption to

gains. to present to keep sense of aggressive certainly market We are we have going see for but to that We share try that. certainly not be of do tried want don't do expect centered. sort to we're to and continue get let's It more to opportunity there share an the patients overly ones that ahead gains in pretty We've here. us, And guidance. for -- our does not only of ourselves

we've With guideline this for might it ACOG, respect to all think expansion. been spring. We waiting happen I ACOG think

before payers calls, it take get on XX board. will on months we've to As about XX talked the prior

ASP as volume Universal So factored in lift or none contemplated guidance. of into Plus our great really not could of in certainly 'XX. a We terms But both tailwind that well in are be as FirstGene Foresight of 'XX. is it for believe those

Operator

Our next question comes from Mason Carrico with Stephens.

Mason Carrico

on quarter year. the and Congrats the

First, could the this you year, with talk cancer about the opportunity disruptions the key to begin volumes capturing some given incremental competitor. hereditary

the near continue they'll think I to term, least operate. in at

do from are will turnaround Or Is the you how guess shifting you do times the thinking Or get catalyst begin is, question for has play them? what think think out? that? impacted? away it about I volumes what clinicians to to be you So

Paul Diaz

mentioned been Well, year, we look, counselors with wallet share the gains. lost about genetic part, I and others. we've I In increased earlier, fellowship over had last as talking think

share And Mason. new and so we've in gains continued acceleration see to recently, wallet an more customers,

one, to. Those quarter in prenatal believe that, certainly of 'XX, And as we some dislocation we're hopefully different take transition these hereditary onboard we do trends the them. volume providers will will couple to even those obviously, we not But among again, or So quarters overnight. of and customers, signing it's they're number happen big can will accelerate that to a this the a it transition of it's in that and because both yes, of not a the even so we one cancer EMRs to assets. opportunities marketplace are -- see

Mason Carrico

then but implied from And it. was the cancer here. seeing at hereditary changed given Got I your hereditary what has around in view in mid-single-digit growth follow-up recent, a it still and just opportunity you're all your target? the it relatively XXXX know there, maybe

Paul Diaz

core product. are risk see use hereditary about core cancer. with We guidelines We for differentiated. It's cases excited expansions clinically pretty the for our myRisk

in see our of to we So upside ability market market, the we upside terms probably win gains. share see certainly do size of the in and

precise and growth as XX% where in both unaffected side, think, and only XX% it's I myChoice Sam oncology on about penetrated, including affected quarter. patients, and for health Mark that HRD the solutions talked this XX% quarter, And you've women's last seen again,

I'll just choppy. annual our So again, everybody this high remind we a volumes in But the of you be XXXX afternoon. we've guidance that confidence can degree quarter-to-quarter, given have

Kyle from comes question with TD Boucher Cowen. next Our

Kyle Boucher

walk This of bit maybe in us this as -- on is to want Hospital detail progresses? -- made you be the you Japan. should this the a Center more what just milestones morning East I are start little announcement Cancer for we looking key Kyle so on guess at Dan. I sort for if could the National

Paul Diaz

industry array X,XXX of right like institution. this the a did It's a across seminal lot broad leader patients indications their now Yes. work with of

to we've So we're our Japan quite accurate proud in it's success but products. incredibly and other had to about are with really too readouts, chosen assay early that myChoice and organization, MRD and highly they've talk follow. they great efficient But

it on us among study. quite again, about I utility. Optum broad work excited we're So MRD. the as array help cover and the a does will will And fact others clinical also MRD of in with leaders we the be our cancers strategy, to that advance really think help It genomics

San that's really is the but and to pay Breast et that for use to as the think early MRD in we And other and days cetera. how about to when A out of this, to docs quite Antonio places. And it do for us MRD lot it. anyone, I payers at We're on certainly excited not talk out. but often, for about figure enthusiastic know of adoption and as us I'm what and here clinic. looking to that with are figure sort how

Kyle Boucher

Got it. it. Got

hereditary disruption lower-priced is a market forward? think So the should this maybe going of hereditary How share gains the we moving think I If ASPs should cancer on we about come to that? space? I from, guess, testing market. a cancer back conceptually, in about how maybe bit think in

Paul Diaz

taking XX%, lower is losing business year we with We that disruptions we're why we Well, in the profit margins of here, space as have earlier, has as issues. we for kind right again, do profitable around this the And of depending price had some because cancer stated XX%, some on strategy the ASP. not our quarter. been alone ASP -- that hereditary see I in improvements only stand that's which payer not the on company gross

downstream So we're why business buy is in terms opportunity to pricing. way. and that don't not be customer lists going pursue of the Which to taking on go we

long things signed through lot went our know, So And a went through people contract in things are moving we we visibility on than had on got as some products, or with ASP X-year the despite more you we've time, and XXXX of a a we've that contracts. our XXXX. of because -- in we to the United

excited the hereditary business. part of that's very about for cancer, we're and the growth again, So opportunities sustainable a

Operator

from comes Brandon Securities. question next Guggenheim Our with Kramer

Unknown Analyst

hear can okay? Guys you me .

Unknown Executive

Yes.

Unknown Analyst

had over you're XX% for Brandon is have Do grow market. next this you quick years the share. follow-up Awesome, on I Steven. that a that on X penetration? That you unaffected push help any just market that could to looking the to levers X

Paul Diaz

of market not this. take a white the -- our meant. I what lot don't Yes. there. penetrated. That's only I'm there's saying, XX% what you that's but is That's No, Mark, space But why

Mark Verratti

Yes.

before. you during the awareness because OBGYNs with on. journey just for there's is if asked seeing we've is really of patient test think, Day quite at million XX and risk questions of mammograms, And being are I qualify some the but family and market, the not hereditary who And the the around honestly, quoted they cancer aware customer we've their getting and Investor look women a over are think not talked the on. who so are market they're the that that think one our previous, them, levers challenges think I I I about level, unaffected

when that those patients great know at swift those information, have ask health experience, digital customer that how way that of care how in those a a and ease And questions, they're a they very so of it a all they the do time think I accurately so do use challenge systems has intake, collecting the actually is great of that flags qualify. lot raise

awareness centers level is excited increase is digital mammograms. of current how to one we So visiting now, we we a in do patients share the how systems with that We're incorporate health and up the which are levers, different with biggest solution conversations journey it which have into probably we're imaging do getting health many stood where customer I they're systems. think

hear year the lot as us So on -- a you'll more that from progresses.

Unknown Analyst

margin on one the And Great. just follow-up outlook. then quick

to want a Is anything that that second half, the of half. ramp help to the focus the there on up or margin you out point test first that sold moving You quarter, would us in into second bit lab said expect half second of goods you strategically then down the per step automation cost in a a like boost.

Paul Diaz

in mean middle moves. I we're the our lab of

Sam are that we airplane we're engines and big continue our the to team through margins changing the are the CLIA through. while get parts volume testament the lot we certification. fact and we maintaining and the here that a are the airplane that to air FDA on in have a gross and flying approvals and the team of So There's moving that working

we've Archer as So essentially, finish robots the we to system. and West. into I robots them these campus continue we from as the think as we San into 'XX, move go our facilities, or into Francisco new South moves and moved And automate built

ago, see you to got that. those For toured that weeks a of few

years. standing as But to continue and technology for chain we sequencing we million target of going of has is that see supply a opportunity that couple believe we're that new a like Sam X up with the after. $XXX lot as me, responsible improve over Plus, to he to So move margins next

that do see stuff takes while lab and even future opportunities after chain going he the of automation more are in and near-term new supply we the So the the time. team today.

Operator

Securities Partners. Our Puneet from sorry, next -- with SVB Leerink question Souda I'm comes with

Puneet Souda

I had contribution the Was just what assays. Paul in items in in a clarification. segments helped wondering the quarter? bills mean, And actually of just biomarker -- and the line there a sort the the first one, from

Paul Diaz

of days. it's biomarker laws bunch state of you payers. early a go what July. the little say, law. the these into we me, in GC payers saw office lift to biomarker in in We until the general And the believe payers just effect going but of like A have are turn And same covered". a for "Well, don't many to think the effect are bit January. -- of Remember, And to couple GeneSight, into states into the then don't it's go weigh it's then

here and that have Texas, but products. XX states, Oncology passed as ability It's for industry XX plans big for more our system. they're for just the in an and testing. broader compared for opportunity indication it's still health we're New of state genomic toddlers -- the This cover Blues others to care Again, the states, rest of put So and in a to York genomic early the the fact days to we pressure GeneSight California of on adoption. the

just the time I awareness, it frankly. a opportunity lot And think so quite sector, increase lift and that to creates that's our of the penetration, in should all boats

Puneet Souda

a bit obviously CRC coming the Could other indication ask leader maybe I you board. IO monitoring, there's forward? more if has with started the mean I path in about on indications it. And are indications the than the a elaborate out breast, and just MRD. space on could Got that

that's you're indication yet, So maybe sort market very just of mined there to still. nascent just pursuing that wondering Is strategy? obviously, not an what's your potentially

Paul Diaz

hats They've away. them. paved great a our off look, -- and they've done I No, job Yes. to

So we the work were appreciative of they've done.

Particularly about deeper have We that, talking We withholding matter. going test. for that's when treatment a you're think to patients.

X, X, big market And X room more be. so X, this as as there's a -- for think could X, opportunity but I than in

but see within to enable breast, the ability different indications you'll and to complicated will studies ovarian, described look and that we precise are us cancers tumors at more endometrial, that -- we're the disciplined stay Mark -- as the us solutions the to I oncology the think known can prostate that about pretty think express. for,

expand And the we're only, and thing Remember, that prostate that's of HRD. expansion doing our we're as well. same to with myChoice and ovarian looking breast

with we follower, But between announced basis a Memorial highly of not we'll Sloan it building be to think test yes, quite we're a a clinical parts MD study Kettering, or giving So we sensitive morning. excited Anderson and really excited company. anything about for on have some a the as in fast else. sure anybody evidence this if body of credit is I'm us the MRD us we're for

Operator

Bruin comes question Bank . next from Derik with Our of De America.

Unknown Analyst

John for much how the Kim Derek. there reducing from is are, how This this on or year we And left or RCM quick can half. the authorizations MRD plan, second contribution or at are launching -- have if on one. improving you of that no looking expect? there collections there medium-term are working What sort in -- opportunities cash A pays?

Paul Diaz

Yes.

news, they MRD So pharma partners, pay. for great our

as our we'll 'XX we with our a be in reimbursement back we half MRD partner just described. year, so plenty as goal. as launch commercial doing MRD Again, partners running of that's think, That's this in assay hopefully for MRD the of sometime. the I expectation for with runway, farm And

the of broader issue ASP prior is Look, hundreds of dollars. cycle of rev millions

are paid of XX% time not getting We for the our test.

in the focused like So we products but whether test. across the in cancer are mature more portfolio, our it's GeneSight, some very where myRisk opportunity we of have biggest our even hereditary

only others now barriers. ]. my And team, products Advantage for it's prior loco one the do join few plan given and lot of ] years OIG auth not talked and for So think upside policymakers up excited providers the next there undue with diagnostic We that of the a about [ things was and the across there's our report [ an Washington we're about in can putting that Medicare engaging his Scott over experiences. to

with us by But the the the working out state-by-state, it's genetics. build But the payers, to clinical prior the documentation through necessity to investments in pull and of it's payer clinical payer, continuing to of EMR, the of our evidence off pull all record record. which warfare kind trench allow out

that All a payers. for enables and partner better do the be of better job a us to

So years. a the very we think that on, company for the over few provides next lot focused and -- it we're is something opportunity of

Unknown Analyst

organic. talking And are and you cash there the you guide checking you're it. -- you're the about reducing in would. as Appreciate flow year investments, this any the terms other any of said CapEx But

Paul Diaz

record. way, It's not for the said by the we would, everything just we

Unknown Analyst

complement in Anything commercial -- you like with wanted the that next that year. have landscape. you to yes, But I back. launch the, for XQ portfolio? that know existing see MRD the going you're assets just you're Any the would say, partners launching pharma come eyeing in and

Paul Diaz

that that time we we in and to know launch to was up and built assay MRD for question first FDA we has an commercially, that faced the $XX in so team for we $XXX approval. can million think capital by all an labs were the invested the We assay spend in shareholders. I return for MRD needed know when get on probably decision told we We company, our can we that stand through million came Yes. our right we our

else issues interesting there's going a and people's commercial is things of lot we're than always to a rather sheet really know do our of are can open, build not coding we'd there, sales eyes judicious coming science those and going going do kind and frankly, lot market, we're the balance great right now. big into -- what success to burn somebody did do that buy, What be probability some and not there. be of tuck-ins There's we keep quite were we're the rate on that out it's higher much going is But we take of but their but things. to be because Intermountain assets on put -- and to looking at take to on really we'll we is like and channel, additive, as we we something

So we're going to be pretty careful about M&A.

Operator

with comes Jefferies. Brandon Collier Our last from . question

Unknown Analyst

of event? a see any lab for and to we'll about year This chance 'XX talked just still on more that you savings Brandon. in some Or of know 'XX. million $XX that Kayla you that I starting off Is making modern is is of bit the I'll with start maybe in come guys a little are around there investments in 'XX? beyond a start

Paul Diaz

of like dropped right? we our changes affect lot mean test cost I it's of so per mean, mix mean, product But think has there. stand new our all have yes, a are and them as I parts is the working I we every I lab, that team in moving year. in day, gross each labs. Shim get last through analytical X% team improvement there's margins so the mix, the through the move CLIA looking And up our of validation. process lot into new there's at to a get the across certification, team products

we So that than it's time we there. originally just actually take XX see more to get that identified, opportunity going to had

have that some are going quickly we in you if continue possible. So people those assume hard of anything. can get the as we've what savings to Sam, know I you'd assumed guide, to work as don't to add though, that

Unknown Executive

Paul, that's I think comprehensive.

Unknown Analyst

quickly then precise And on just Awesome. liquid.

the have in commercial steps Before through side ahead of the you launch taking you're XQ, can that. any on

Paul Diaz

Yes. liquid anything currently on side. using And in I is of all we we unique the today precise don't that both news solid are tumor, the the think good there's oncology on I about right? currently if as almost well the launching offices know are liquid,

consistently our they this clinical time But spoke I Myriad small, to do and we when on proven again. comprehensive to is to panel. large has look for talk call time both think a to something which and look that do customers, utility, for we

And well as so now germline well as we liquid. as have comprehensive tumor as solid offerings, both on

I customers puts even wasn't considered. very that position Myriad with us think unique where before in a

we've is about the the a third talked then obviously think two of use, is lot I ease piece affordability. And which and then other points

of one And always where so now comprehensive we've but have those, will. in a offering. not we did the Myriad we area have, And customers in many met the didn't

launching details. into make think already of we're a is But share And of those those Myriad So today. success some the benefit to most sure got products I think market. of customers the I we'll with has

you Well, all Matt? thank much. very Great.

Matthew Scalo

This will afternoon. for much. very and via for X on earnings Thanks Yes. be our concludes us, call. replay Thank our joining A week. website a have you good again webcast available

Operator

your program. participation. for This conclude you the Thank does

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