Guardant Health (GH) 24 Feb 202019 Q4 Earnings call transcript

Ladies and gentlemen, thank you for standing by and welcome to the Guardant Health Q4 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions]

to Mendivil, conference Investor like speaker to now Carrie today Relations. would hand over the your I Thank you. Please go ahead ma'am.

XXXX. year Thank released you. December full financial Health XXst, ended results for Earlier the quarter today Guardant and

like If you've not to please added this news investors@guardanthealth.com. list, the distribution an to if company's release to send be or received you'd e-mail

of These are that statements during make involve I I'd forward-looking within and could Before statements will uncertainties begin, laws. materially like or cause management to from federal the risks material actual meaning call those anticipated. statements events remind that securities differ you that this to results

uncertainties Statements information these release today. press Additional the section issued appears in risks the entitled Forward-Looking and Guardant regarding in

the For Form a and when and the year XXXX. Risk annual report company's Exchange for of XX-K in December with report including XXst, for more December on annual the its complete section list XXst, see Securities year Commission please Factors ended the filings XXXX ended its other and filed the description

conference and required Guardant as February information or forward-looking contains the disclaims update or to projections obligation financial XXXX. otherwise. any XXth, information only live revise whether law as or This events because time-sensitive of statements by future is any new accurate intention Except broadcast call of or

Executive like With Chief Eltoukhy, Helmy? Officer. Helmy and that, to Co-Founder I'd turn the to call Guardant's over

welcome pleased XXXX thank Thanks to end to am and you Health's Carrie you I fourth us everyone joining and afternoon. Guardant for call. earnings year quarter this

AmirAli Chief Bertocci is President Derek our Joining Co-Founder; Officer. Talasaz, and our me and Financial today

story. old receptive cancer. Stage was our ago, will XX-year diagnosed with call putting breast of values About Consistent woman with our I first, II a start with years patient XX hormone HERX-negative a patients

was with Following a She rounds years, was physician. her and mastectomy, cancer number adjuvant aromatase in treatment of remission. regularly of monitored by for therapy, inhibitor an five her chemo a

returned. and cancer approved test quickly was It for rapidly. progressing patients which therapy her immediate to and her Unfortunately, After presented identified an was In profile respond mutation. shoulders. recently had failing GuardantXXX in had and PIKXCA XXXX, with ordered pain a to combination She her on a joints response. she metastatic oncologist with started immediately chemotherapy,

the are at this believe cancer interventional and care the cancer not Guardant decisions for and of cancer of ultimately, conquer demonstrates with outcomes. To story but many It in developing growing lung precision-medicine the patient across to importance is We treatment achieve patients continuum products paradigm cancer, mission our types. with transform goal, inform just across we that data. to oncology

experienced we cancer During In and platform a paradigm XXXX, laser-focused revenue, on incredible we XXX% XXXX. biopsies. up have advanced further with will we which be key Genotyping for growth across believe market million in the to ended setting, blood-first been from our liquid shifting accelerating the year of the to $XXX the adoption

establish has to focused record we investments of studies, and quickly clinical comprehensive lung lung time on, in in utility our we created efforts and to tissue non-small helped in Early a gap efficiency, testing. with we're physician-conversion able the which limitations cancer cell Through clinical decrease cancer reimbursement, clinical critical believe high-impact in lead improve where turn adoption. to GuardantXXX

results. the at testing tissue results demonstrated NILE faster to the of we and XXXX, beginning published a that concordance Specifically, to high from study our time

in a volumes the clinical Following of the publication of course NILE, significant we uplift over the saw year.

on outcome our publications along studies reimbursement continued Additionally, to front. NILE the led with and XXX XX progress

the year. into XXX also over saw efforts for cancer from of commercial of non-small cell for XXXX, ended gains and GuardantXXX. million lives with increased LCD significant investments we XXXX XXXX, we and lung Medicare Heading our these in with private Following than early headway made August payers the more covered course our

progress, As grew tests. in volumes to result XXXX GuardantXXX of a clinical clinical this XX% XX,XXX for

year time, made business. analysis, also progress At the the various companion-diagnostic opportunities. We ended commercial than our biopharma screening, spanning important collaboration development XX in more collaboration and biopharma with retrospective projects we prospective same partners with

volume of As tests. XX% during result this grew a progress, XXXX XX,XXX biopharmaceutical to

XXXX, During a team the made are very with version throughout work very still of programs, made our said, That this Lunar-X may also our and of beginning we study initiating ECLIPSE proud and important to of great our LUNAR opportunity. I'm launching believe progress Guardant of the clear at headway a year. deal assay. tremendous we be still the there done is the we for

tumors, living XXX,XXX with reality patients solid is are for unfortunate not recommended genomic of metastatic majority testing. disease that the The the guideline receiving

lung example, of Guidelines studies less XX% COTA cancer in on patients cancer for than testing. compliance than NCCN in recent based of X% less and colorectal with with patients published For are collaboration biomarker

we to blood-first guideline-recommended Heading of a towards increase market paradigm number into shift the XXXX, patients receiving are working further the genotyping. and

and recently expansion testing further approvals testing. targeted the from genomic progression demand LCD, comprehensive the Medicare Pan-Cancer We to finalized to upcoming for therapy drive expect contributions

setting. with GBA. advanced Last liquid LCD our tumors December, believe in milestone the the critical We to biopsy a we Pan-Cancer this covered for solid use Medicare across GuardantXXX vast the to majority makes of the broadly liquid were and finalization LCD announce only be first first-line for happy of biopsy from Palmetto

lung tailwinds test result cancer, experience our payer to in future non-small current new policy cancer. to cell LCD private expand this lung we significant and will usher a Furthermore, we milestone Similar ASP. this to in beyond expect expanded step-up expect following coverage our further for the first in

in new their initial tumor mutations. treatment on for based newly-acquired Importantly, the after options therapeutic help Medicare MoIDX covers testing identify LCD decision disease to treatment progressing also repeat patients

stage approvals In further partners, clinical many we increasingly also cancers prostate workhorse has increasing drive programs. targeted the and that demand testing. comprehensive setting, Finally, by our in our we expect for especially encouraged from genomic the GuardantOMNI, are colorectal demand research will products lung for biopharma therapy upcoming become for which the

Guardant. more have ahead the never about opportunity I Overall, been us excited of at

for year range revenue the expect the million. As XXXX we we in be $XXX to look of to $XXX million to ahead,

successor year. in second the would transition. for a four quarter planning almost a company's instrumental as until this at like is to underway. during of remain release hired this Guardant Derek for Lastly Derek company retire over contributions and I which to our new announced take this been to his have is A in growth. a Officer afternoon, and support thank press Financial moment plans to Chief Derek already the the for search to leadership years is

the our program. I turn that on call With over partnerships will and AmirAli biopharma LUNAR more detail now for to

Helmy. Thanks,

posed clinical trial enrollment. identification clinical this tissue believe to also significantly care, a patients. biomarker-driven the accelerate as liquid poses a Just challenge genotyping challenge eligible for can We address biopsies in and of it challenge

at this study, study GOZILA with was tissue the fact, proportion times XXXX Plasma data associated In umbrella-basket quickly. our alteration advanced ASCO same GuardantXXX three GI, GI as with a patient patient higher cancer. recent in Genotyping genotyping rates from demonstrated GuardantXXX enrollment In as clinical presented of trial targetable found with

biopsy partner. time identify that those overcoming rapid for Furthermore, is tissue interest biopsy biopsy, doubled are reach tissue. whom Guardant turnaround barriers and increasing the as by associated We tissue limitations broad available. there patients can with in together companion to demonstrated also commercial liquid patients response therapies removing rate more believe approved GuardantXXX rate with diagnostic our a Crucially, overall testing with of enrolled comparable Liquid enrolled enrollment. with

collaboration announced January, development KRAS this CBX to who with non-small claims this are for of targeted early inhibitor cancer. GuardantXXX number the for the will lung we XXX biomarker. cancer identified develop patients XX% to patients GuardantXXX life-changing AMG increase potentially with this the AMG treatment We a as ultimately for improving as in In thus Amgen the access believe of for eligible of diagnostic strategic companion XXX lung their cell that therapy

to Europe Japan. to the with support filing work expect United in We Amgen and States,

where in Now LUNAR-X to long-term and turning adjuvant clinical are an which decision-making LUNAR with committed studies of evidence space. we for interventional generating monitoring will assay critical -- to based adoption recurrence utility are residual-disease a program component on therapy starting sustained this establish drive and testing, developing we to be our to when

our CRC lead LUNAR with commercial clinical we for cancer, GuardantXXX taking the we with are path indication. for with As our where a lung approach focused development programs as and started similarly

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and our Dana-Farber excited treatments a Institute also III with and Cancer, in MGH are adjuvant We to Up manage the start announce Stand interventional prospective Cancer collaboration the Stage of To on Colon ctDNA manage to study to post-surgery. utility detection chemotherapy. expect If clinical these disease will the patients based a studies validate biomarker residual we ctDNA based adjuvant of successful, as on of Cancer

to potentially groundbreaking partnering be studies. excited LUNAR-X are We on these

enterprise technology average the welcome CMS in in cancer innovation continuing Now program and pivotal lead responsibilities in scale Kalia make infrastructure progress our a our security enrolling to Officer. potential information, submission XX new as to use digital Kumud role ECLIPSE of data Among our as and LUNAR-X sites and study application our for to important we and designed Kumud advancing ECLIPSE FDA is with like moving play teams. our prospective to our for screening lead Guardant's screening are to adults. our registrational study prepare growth. up would already in software I'm ability by coverage multi-site phase LUNAR-X. and development his We've next than to patients. more confident in colorectal for Information support Kumud's diligently cancer risk been of a I will colorectal assay Chief a

for I the Derek? call Bertocci will on over financials. that, now to Derek more turn With detail our

you, revenue of million, in million payments in from payers received year XXXX quarter cash XXXX. Revenue for processed XX% samples denials reimbursement up for included million $X.X quarter fourth quarter. the successful of prior Thank of AmirAli. $XX.X totaled appeals from $XX.X the Fourth

the this operations. indicative of age Given our is with believe appeal's do of appeals, associated course these revenue samples not we successful ordinary the of

million from oncology an quarter the in XXX% period. totaled in prior $XX.X Total up of increase This precision in volume. $XX.X from quarter the quarter to year year million, oncology was processed due appeals the in prior $XX.X Precision fourth million, million from fourth revenue samples $X.X XXXX. test successful clinical revenue included from tests testing the up for primarily for $XX.X XX% million revenue the for

$XX.X totaled Fourth tests, from from volume year quarter tests GuardantOMNI. biopharmaceutical for oncology in the for quarter million, precision test up prior in $XX.X XXX% both X,XXX quarter year clinical from to up revenue GuardantXXX XX% oncology the million in Precision an totaled XX,XXX and the tests prior volume due quarter. fourth increase

volume X,XXX in quarter. tests primarily prior year the compared Fourth quarter. The recognized in quarter greater quarter up to which precision from from selling of per selling X,XXX tests fourth the tests has GuardantXXX tests, $X,XXX oncology proportion up prior Average of XXX% was the biopharmaceutical a XX% than biopharmaceutical $X,XXX, prior the revenue the was increase tests, GuardantOMNI by totaled year. driven year price a higher period same in

related companion XX% Development The active services biopharmaceutical diagnostic increase in an was for revenue services. increase from and fourth up XXXX mainly by million, quarter $X.X from quarter. driven year development customers the the projects prior in primarily regulatory in totaled

gross appeal's Gross These of The in XX% of XX% compared was for million million quarter profit of fourth of total of the margin testing $X.X of year. services. results the cost prior $XX.X of in are of fourth less was the profit of the profit the a to XXXX development Gross is during quarter million, cost XXXX. to precision as inclusive the same gross quarter $XX.X compared oncology the period fourth benefits and revenue. revenue

greater primarily proportion Gross the per by efficiencies due average increase due of tests as production reductions revenue in testing oncology of margin in to GuardantOMNI improvement to well tests. precision biopharmaceutical driven as was the the cost

in as reminder, a revenue means restated adopted ASC standard accounting XXX new Instead January not As the that our accumulated statements. revenue as the deficit resulting X contracts recorded XXXX. completed of difference opening XXXX, the retrospective method, revenue not using effective XXXX was January for accumulated that from adoption standard all financial reported modified XXXX applying X, the were to which we is to of new

disclosed The XXX The in change of our was that effect effect adoption ASC by of compared to this release. is have of the been ASC press $X.X XXX. to QX increase adoption of the million QX reported revenue without would revenue results

the in for XXXX. increase $XX.X from of fourth million R&D were of million, the quarter quarter Total in million LUNAR operating XX% $XX.X primarily the studies program quarter the the performed fourth attributable for a the and expenses $XX.X expense for to development compared of XXXX the fourth FDA, was quarter GuardantXXX million XXXX. IVD preparing were to of $XX for submission work XXXX and products. improvements studies The and processes clinical and additional to to increase clinical fourth

marketing for and expenses fourth to expansion costs drive commercial in revenue. increases increase XXXX our to personnel million Sales were of of the the increased to in XXXX. was fourth million related quarter compared of $XX.X due quarter $XX.X to The programs

services, additional primarily was professional support and to legal filer. to and million the transition a accelerated costs General XXXX. administrative required large including for million and in in compared to expenses increases was $XX.X fourth compliance quarter of personnel, quarter increase were the accounting This due $XX.X fourth to

in attributable unchanged XXXX in $X.XX year. change fair quarter the loss was XXXX value compared of $X.XX a stockholders in $XX.X common to a period to of a quarter $X.X of Health attributable to $X.X as loss corresponding compared of fourth to the Guardant our Health compared charge the XXXX, fourth benefit the the joint the venture. Net of Net common includes quarter to SoftBank's Guardant prior XXXX of ownership quarter of million of in for million stockholders million in the fourth in was fourth

average of Medicare Clinical the per a year test were XXXX protecting the increased oncology increases XXX% in to a in processed $XXX.X grew million. for for commercial in starting revenue revenue access the XX,XXX XX% from in tests. the earned increase to XXXX, payments million from Act by Medicare year-over-year in from $XX.X million, beneficially cancer patients revenues reimbursed The $XXX.X of XXXX Precision rose full XXXX result quarter appeals that the revenue tests were prior samples XXXX. successful year up by XXXX. volume payer of to tests, and year million $X.X as XXX%, XX% recognized from of lung Turning fourth affected revenue for XX,XXX from

revenue the testing totaled of $XXX Clinical includes in samples. from XXXX million which $X.X XXXX of million, appeals revenue

believe of increase this to associated volume in ordinary of course for grew do age GuardantOMNI. appeal's due the these samples the of Given of tests revenue with is indicative the successful Biopharmaceutical year-over-year XX,XXX we appeals, and an biopharmaceutical number our not their operations. particularly to XX% customers contracted projects

XXXX $XX.X Precision oncology in to testing to revenue in XXXX, in higher for increased from $XX.X increase GuardantOMNI. the million volume charge plus from price million biopharmaceutical test customers due XXX% the

companion to with tests, of due than the was grew a in biopharmaceutical diagnostic Average GuardantOMNI $XX.X revenue revenue XXXX services tests development a in up XXXX, per being million tests prior biopharmaceutical new companies. $X,XXX due year XXX% tests. in recognized from Development $X,XXX greater proportion XX% price mainly selling to which to higher has GuardantXXX projects

to gross XX% in prior million margin XX% in plus prior to clinical oncology the to cost of biopharmaceutical XXXX profit was margin gross as in XXXX of average year. test and per reductions The year. $XXX.X in precision the profit compared was revenue testing. the due improvement $XX.X compared for primarily Gross million Gross a the increase was during

$XXX.X from The earlier million the noted drivers to XXXX increase expenses XX% the the expense same are as fourth operating in in $XXX a quarter. increase were related million, Total XXXX. for

joint stockholders XXXX. increases ownership the charges million loss Health and million in venture. XXXX in in XXXX fair $XX.X Net our in It million to includes Guardant to of million of compared value in was SoftBank's attributable for common $X.X $X.X $XX.X

to XXXX attributable $X.XX XXXX. share stockholders in marketable per and as to Health quarter loss ended We cash compared Guardant in the fourth common securities. cash, million in $XXX.X was of $X.XX with equivalents Net XXXX

Now for turning year outlook our the to XXXX. full

growth over As mentioned, of we approximately of range. to million, representing revenue XX% the to in expect be $XXX Helmy midpoint of range at $XXX the XXXX the million

clinical range represents in We sample be XX,XXX growth to over XX,XXX to XXXX. to XX% approximately XX% the volume tests, of of which expect

full in increase year range million, loss the of investment net we $XXX programs. XXXX to LUNAR expect as million $XXX in to for be our We the

a Embedded key few in our outlook assumptions. are

fourth from increased programs our resulted revenue services in biopharmaceutical of and related the our collective from during First, quarter of any far. development highest ever number activity a in tests so XXXX recognition quarter biopharmaceutical given

biopharma In growth remain As we our long to in quarter. our Demand continue biopharmaceutical expect in significant from have customers. our discussed, lumpy contributions term. XXXX, to customers peaks lighter from activity and the over strong biopharmaceutical expect troughs in from can revenue be and result business we we the first

is and revenue the the benefit quarter to – our benefit our reimbursement LCD the timely to expanded adjudicates third the forecast to under. Noridian begin expect benefit second timing This in full finalize of on is beyond. pay based The from quarter MAC second XXXX and begin in that that its to more from LCD assumption with there Medicare we to expanded claims Medicare

point, like At back closing I would this to comments. turn Helmy the to for call

of Derek. I'm year. team such proud you, our Thank for an very incredible

During updating make our our well you we XXXX look to across rapid XXXX, forward strides platform. believe on we progress. are ambitious In made goals positioned our against to and great progress we

open questions. up With that Operator? will now we it to

comes you, Thank from go Sir. Instructions] question Please [Operator Puneet SVB Souda Leerink. Our first from ahead.

and all of you Wanted of CIO first working retirement implies good with growth guide with midpoint. terms Derek, in XX% to a luck the at – Hemly Kumud the in first and Thanks. role. I recognize ask you guide the great Hi. welcome the

also lung you for have with you look potentially first XXX% ramping grew but GXXX Medicare mean biopharma adoption LCD, I and I year and approval year. FDA Pan-cancer was LUNAR-X. for last You XXXX we have was biopharma when XXXX strong appreciate the at impactful

So in also here on where details some what's that? it just Thank you guide if are trying of at understand number. LUNAR-X? in And that loss Is I'd XX% touch growing? some to on the appreciate you. growth? – implied net Is investments could the LUNAR-X then or those

start then Thanks, let in Puneet. off and I'll Yes. others chime here.

and private terms large components we number were last of in reimbursement had the added increase, got year, to there. a So from Medicare Obviously, XXXX and that. from there of the of year incredible the had beneficiaries the ASP we both payers thinking about are we that we

the really side, OMNI we ASP And volume growth because good which And from GuardantXXX, significant of that to of side, the and uptake double so well on we saw very the clinical had obviously growth. has really kind ASP. ASP clinical both this of whammy on growth much biopharma shift was major in swing a terms as higher

us those side. And in clinical terms ASP points are major on then and growth the so inflection biopharma behind of

what see so more businesses. in And in organic XXXX we growth the much is of our

very still we're about so us. in I much think this terms And excited the innings early year space. in the of -- We're in ahead adoption very of

for so to And come. many robust continued we years growth see

spend of the terms LUNAR our of of acceleration the making programs the in terms investments lot investments. around a In we're side things, of of those

LUNAR-X COBRA Obviously would and of with If $XXX to you these doing and Stand of in million that doing ECLIPSE things studies that on we we interventional it's Up building. some trial side be infrastructure million the surrounding remember, to our of Cancer. about $XX we're said of the that to not some inexpensive we're dedicate terms

we're it's But And over a going the to significant up to open medium opportunities significantly that whether as in because market investing longer-term. so we're result space.

getting from I ASP have have I Okay. been investors. on that question Thanks. And here that

with baking first the Just us you improvement? in Pan-Cancer the help for place the are is you us of If what all Pan-Cancer LCD remind in ASP could what -- understand to And reimbursed that expect expect And size now is Medicare February should Xrd. get rate? was the what should the volume versus effective before? LCD on understanding my we we the

should how the first that we quarter here? So contribution in much of expect

Yeah.

LCD, you Medicare our one-third we're currently So for reimbursed I about of our think under current volume. if remember

this We expect LCD volume reimbursed. Pan-Cancer double under the of would at to least two-thirds conservatively that least it being at

in terms our Our is price of reimbursement -- $X,XXX Medicare. list

at are there confident are paid are these getting I think it we still We're covered on third will start before likely we quarter that of required some but the into before administrative paid the happen, And the be on very least most actually claims. claims most or fully it of claims. procedures will

squeeze feedback Okay. Thank any the from Thank what's -- your FDA? for one GXXX you. questions could on in timeline GXXX. what's or approval? been When Last if or And expectation I you.

AmirAli to who Yeah, that. I'll turn it answer over will

sure. Yeah,

and of back And active its we've is first actually conversation kind most this expected us. we the So been a as submission. surrounds half with FDA for in discussion

and process agencies package had those the a some continuing. on submitted that requests we So is active based the bit unpredictable. discussions recently the agency information data We questions and actually with additional from and

going So we now that direction of timing conversations confident feel very in stage. the terms the in right are

that developing its through dealing framework some go are reviewed of You're submission a we get and of devices with and device then approval first kind process. breakthrough to needs these kind how

Okay, great. Thank you.

you. Thank

comes next Our go Cowen. from from Doug ahead. question Please Schenkel

taking for you thank and afternoon good my questions. Hey,

First help Thanks off couple the all on your Derek of your for past congrats years. over retirement.

starting on and following question. maybe Puneet's So on just Noridian up

described. So been the understanding finalized comment our last for like just you July. The expanded ended period LCD hasn't

little on that year. becomes LCD that no are completed And done in this I with your your that payments before in embedded there it's effective all expected. year So it's assumption longer fair just what I to for that into in that Based taking are any for getting you've the there say some catch-up -- make the think at this expanded this bit guidance concern effective? a at regarding point sure is becomes want assuming the are tests than to outlook you this QX. the line guidance for

Yes.

and But start. bit is be this is a LCD. of this collect because very behalf years -- prior little be we confidence So, Century's -- LCD. a a maybe the this that of able to able that are the under few Cure of than Act that in as terms kind acquired being we'll have of year this eventual There confident different We're collect result. finalized under XXst I'll administrative will are Noridian on there to logistics full and payments

catch-up payments? And the second part then about

something is that's Yes, -- seen. remains that to always it I be think

think to-? but depends let I'll on it I trying the Derek specifics, maybe

catch-up extent that ultimately this thing. some, as that will but it's at any to -- for something to LCD we a payments. The their you Doug. are not us. payments decision the our And as when finalize Yes. there Noridian be we've predict had saw would have whether there something make to or We've catch-up can't they it's not predictable

from are standpoint, any. So, guidance a we're that not assuming there

Okay. all helpful good. and That's super sounds

you to any think philosophy guidance question know I up of back guidance If major your ask heading in need I simply there's some million And were if sound change the you aggressive for last really No by revenue this beat way every it more right? mean also I $XX But guidance like level over that there went a we bumped doing to high math doesn't than about into guidance initial things quarter. philosophy. entering effort as XXXX, your series just year? I'm the put you the get were at ultimately, last year. year look at you year?

continued -- our And continue and to to provide Doug. be that's try do we reliable We've goal. I we Yes and that. guidance. -- believe we're mean what to accurate

it. got then And last Okay one.

NCD? long beyond covered. commercial and expanded in then coverage do the even XXX successfully lives expanding you those And some to would with that coverage forward just XXX do LCD have the payers how you that in decisions. you pending approval beyond within million move that lead think And already the very FDA specifically, the maybe FDA the moving importance believe Given about of of

Yes.

Pan-Cancer us LCD Pan-Cancer give in tailwinds of Doug private I from things. of potential that some will side to lung the just So, expansion terms say the would itself on payer

In able we ASP as reimbursement improvement marginal LCD. in FDA think to will over Pan-Cancer give terms of us and NCD a the leverage and that maybe a terms this being of result,

ASP and this point getting bolus reimbursement upside LCD. an point really view of we're from from of of view the So, Pan-Cancer

the the help I it even the over think But it will though being payers been stamp late order test validated that to the some with is help quality will and conversations of there. so that has market think We they medium of term in think this of in of terms it will majority essentially that on. FDA certainly private they see can especially in majority longer can that middle are with and and terms really and so more I where a laggers

see a we of of of approval for FDA adoption. So, kind kind catalyst as to market really stage latter middle the

Okay, super guys. helpful. Thanks

you. Thank

you. Thank

Our Weinstein go comes ahead. Brian from Please next William Blair. question from

submitted just six-month timeframe approval late that be go for for and you expectation Thanks the your you in wanted taking is to I a guys. Hey And November. few next question. the approval to an early I in October some had believe catalysts still FDA months about through here? XXXX. question earlier follow-up a time for to think I talked had

else just releases or terms to incremental you of the data on are to And for some And the about specifically timing pieces that talk still if can pipeline your us XXXX information So, on then of in forward be of anything other expectation? should expectations? looking some more we in catalysts how give is these other that information projects pipeline progressing? particular

So maybe I start.

So it. conversations mentioned back the the some reason still. aspects But and agency of on work FDA time that the frames the based side with any had that we see We not don't all would forth. on and mentioned frame to still know more you are is are we realistic. unpredictability there through But going process, this time that and as we are going you

those would haven't time guide lines. us You against anything, heard which

they're and script. there a are advanced cancer the safeguard are like, mentioned data of additional out other studies of coming bunch terms as applications for read the In getting that's during out Helmy clinical GXXX continuously

of publication in kind We good could of added XXXX. XXX you are more have pops peers and expect

and More think conferences, major maybe Guardant going contribution you've those as LUNAR cancer-related importantly, data conferences especially in I seen the GI around programs and on before. by you're conferences some around see conferences, to

be this year, same. the would So we

ago? us things you dig as number any on utilization information from anything typically hoping can as you some qualitative progressing today idea information maybe a the the as of of you kind guys clinicians I'm or clinicians, seeing some are that that as far kind about how versus then information utilization And you it that help of to of can Any metrics? far that like us those provide And GXXX? progression basis? a can are see year of now cohorts what on ordering Okay. for patterns quantitative some into ordering that are get Just of ordering either just give

Yeah.

continues So the very right metrics we the the to to look terms moving in would of types robust in see like data and monitor direction. that of

For only also the as grow and in are in ordering right and and those lung doubling a direction. number much in basis have penetration of breast have deeper the really increased the depth almost regularly from But and so clinicians vast the oncologists number cancer ordered sales a cancer cancer, more seeing ordering continuous prostate utilization of a the that majority going we of instance, year seeing, are we're of where importantly, test, ago expanding GuardantXXX. not that XX,XXX seeing GuardantXXX the And oncologists and of so now ordered well. but in colorectal we're cancers it and we're on just same-store pretty not we're

really LCD robust usage barriers with the Pan-Cancer And of I some And XXX. very financial think Medicare we growth think remove metric. to of every almost that help seeing and adoption of broadening the so the will we're across

guys. you, Thank

Thank you.

ahead. from from Derik Bank question Our Please go De next of Bruin comes America.

This Derik my is on for you Thank Ma Xiaoxiao taking question. today. for

I clinical more LUNAR-X see the focus updated key recurrent on market an see, monitoring wanted a if view line as lines updated the So first to competitive, of adoption view time to LUNAR-X. – for time lines get can other getting I of key as well this at all, to on competitive we wanted time monitoring as landscape cancer Wanted Thanks. point? and for cancer

disease or So is for detection? this monitoring recurrence digital

Yes.

Yeah.

of on clinical type think trying as see can and really patient in that to show difference I establish those focused trying you So outcomes. to we're testing make a really utility

a of terms Cancer undertakings so fairly MGH working are announced and oncology with handful and NRG technology. terms of establishing And the clinical that those we've significant just with studies why the their that's terms Stand in of working working in of think with also biopharmaceutical and investments COBRA some I using companies obviously these adjuvant Up or we're making with we're utility. Dana-Farber, To big of then in really on

you've space. a see significant takes amount as to We in broad seen really reimbursement selection it the GuardantXXX evidence the of utility data space, therapy clinical that clinical with support in

biopharmaceutical the now. studies now space on the And are so lot then a right of the kind focused right and space of study

unique. fact we in approach approach. specific But really has is I where that that extremely terms technology is the think very confident it haven't of kind genomic in take epigenomic our seen We of terms the feel and biomarkers of both anyone

a terms have we can think advantages of lot need we so And in unmet market. of really hit in how we that

assays statement. Helmy is as used Maybe we one The LUNAR-X mentioned, it's only that blood been that have studies clear more in validated these assays just add assay. for and

of right setting, time, information our that you to product. can of the and the based adjuvant So needed. that's the adjuvant are a impact logistical LUNAR-X there offering that the challenges could getting tissue at with treating tissue on to access we make in based an information assay timely provide we we saying way you setting looking no are significant a the And is at we in really prior physician are doing blood value only so and believe what is

helpful. That's Great.

one Second more GXXX. on

on can updated get on regions you. we situation in EU With LatAm? view Thank the and going China, OUS broader opportunities the an adoption Japan, virus international

minimal at impact given from broad I it's think terms think we'll it remains business. now. seen it of U.S. take the pace right amount have I starts comes global obviously, our revenue in how globally, And to significant this a how terms to of in if affects increasing be becomes. the Obviously, that the of Yeah, probably really obviously, pandemic look our

Great. you. Thank

Thank you.

from go Our Please next question comes from JPMorgan. ahead. Tycho Peterson

taking for Hi. my This Thanks is for Eleni questions. on Tycho.

noted for bit the volumes increase then NCD. LCD XX% higher will payment to pan-cancer a following the that around rates and you've test XX% Medicare to So your

whether be a the with Just the And to anticipating or of NCD. buildup same you're there as get LCD sort sort whether will wondering there? that for of of XQ

Yes.

of LCD itself in higher. potentially kind the first by us covered, would think pan-cancer I So XX% but to could of even statement the we claims you say made, about to get doubling

on then there. marginal give own So, an and might improvement NCD its us the additional

maybe the of in terms chime In the of terms let kind ramp-up, that piece. Derek modeling I'll of there in

Yeah.

So that our There's to the to QX. submitting that new we takes until begin occur ramp-up have not And for their providing required in be expect we able that our were information trying is to didn't to to finalize LCD that claims. make point yet doctors clear begin at would it that that given Noridian the also we steps submittals.

do usually some good a of for submitting to that there's time of job information. So to begin our period doctors

becoming LCD over at consistently them supplying was good that that The a process period. six-month first of

So we part this quarter. we third be indicated towards quarter we're full be sort that's some it will of would second the there that year the in third of that stride. running ramp the that -- during latter assuming that And why in and reach quarter

to on topic from then following policy And payers tailwind coverage helpful. commercial suit That's follow Okay. Medicare that to up the dynamic. some and of

given wondering associated by side whether proportion to recent the set be expectations volumes for and about on year-end talk commercial progress could reimbursed your of ASPs? Just you

it's think terms I The difficult in commercial be Medicare of going most predict frankly component timing probably to longer exact is be I've is to the as step-up. ramp that. and component to that's a said think going of significant I the

of ASP the would I that say the contribution piece really in is the focus most provide. of So that Medicare terms would

you when time provide about don't missed could your CRT expectations we and LUNAR-X. associated initial Okay. That's this talk Can for XXXX-patient in I enrollment for the you but trial? COBRA terms know expect rates maybe then I sense also a readout? if helpful. And lines of the lastly And can

LUNAR-X XX way to enroll the are ECLIPSE started study guidance we guidance study. to and for that all patients from sites. XX it's very starting XX the the over And going us ramps Maybe enrollment up to with when to months basically ECLIPSE to that the started study take we happy with

one about that the accurate time would previous We that. and earlier. believe within that we patient we I are is guidance the be frame last the believe very And is that Still study in enrolled. the excited mentioned

study that end basically of very colonoscopy until we we in with the last expect lock up. reports we And terms data lot quick this and a are of comparing basically it's patient study, have a phase the database after

it's Regarding in network COBRA, major a actually major how to just we see with CRO. it's go and program so collaboration trial, to we have started and going that

So specific the little we some need we bit study still time have out there end. more a before time lines when putting would like

Thank Okay. you.

Thank you.

ahead. Please Our from next question comes from go Patrick Donnelly Citi.

the clinical this guys. a I earlier just volumes a volume you the could a to how just bit talk one there. if thinking Helmy higher? touched Thanks as approval on think from approval little you're about FDA you do on catalyst about much that users Can side. you How how it hear Maybe but impactful be? hang-up drive potential isn't FDA

wondering kind factor that gating now. a of Just what is right

Yes.

to have over the almost approval. two behind FDA we of that and ago mentioned obviously And those that NILE think we seeing saw us catalyzed in first three catalysts year this of liquid And comparison terms space. then I the adoption are had It was indeed So versus we're really had I now. tissue a Medicare that think study approval space. pan-cancer the

the innings it's of now. rates, And liquid. or kind of we longer-term adoption the look We're and as they're first realizing fairly in you I gains genomic XX% two. to those very below really catalyst in term still think of all really. market the low. -- terms a much longer in still benefits the and of right at when early comprehensive testing They're more to tissue do -- FDA see from whether approval medium

still that middle approval stamp work think quality, a so FDA that every really believe clinician and to late And majority. we get make time a into recognition lot do difference stamp of it's it's in that laggards understands. and of finally clearly to there's will because then a And I that more frame that a majority

think And medium the so -- I over important, we but longer think to we term. it's

on guys revenue then just maybe Okay. revs sales a are focused the at rep XXXX? know in salesforce kind guys of that force we saw on very going thinking are sales ramp due about partially Obviously expansion the significant that least or per of you And driving you how the in XXXX force. one into I additions.

in economics terms as think, before, think we've Yes. about And, of the mentioned really selling we I do the unit test. economics --

additions as think but is, channels a just target and channels. areas, force, philosophy invest the many whether sales have terms We revenue in digital marketing other and or those we in we in other that long certain its as see continue gains invest the I of incremental in, to we'll continue not from rep per the to of

we we'll obviously, in seeing saturation, When areas. won't and start we other invest incrementally invest

investing multiple I now, commercial seeing our growth think, opportunity for are channel. of still right we're facets and so, we of And a in lot continued

just Okay. approval. to back circling last maybe the one And one, FDA

Are approval? FDA Your approach talked you some to think, discussions circled about you've in this companion diagnostics definitely I seeing we pharma the of past with agreement. see around. more companies as is Amgen side encouraging front, the interest on the

case see You post-FDA that Is feel up of inflection like it on after kind shaping there, there funnel approval. volume still could FDA be the Just curious you there. approval? the an a the

sure. Yes,

their from a lot by a fact for picking partner commercial the we our basically So companion but been that many, as in also when many been interest drug we GuardantXXX a it's test choice as assets. actually, partner is, factors they're pharma mentioned for centers. PMA, been there's our about of companies important has companies, -- One in That work we that with thinking to pharma multiple route that as it. script and a contributor GuardantXXX a in also to of as many with used the partner conversation in the reach are to and seeing physicians and market the diagnostic CDx with Guardant have CDx significant multiple of is

you. Okay. Thank

you. Thank

comes question Masucci from from go last Our Genuity. ahead. Max Canaccord Please

afternoon. Good Hi.

First, Derek, with Congratulations. pleasure a it's been working you.

what's higher-visibility And your been before revenues, approval pursuing development segment? forecasting versus waiting staying then, So, services less to FDA likely biopharmas a revenue the guess, product on that visibility which explicitly I collaboration? for specific have approach are your an will pharma have CDx agreements, there

I I and maybe to it start give So Derek.

Guardant for companion terms really has company, pharma all with of us be conversation the the acting enabling just fact IVD quality for as IVD of diagnostics is that our the reagent in and infrastructure to a table being talking about choice been of an CDx system, manufacturing, So factor partner the companies, agreements. the the on upgrade

these conversations and to takes really partnerships. a time develop long are These very lengthy

very long is of period a becomes fruit. pipeline exciting. our some But a So conversation that a before kind take of time it these to are would

I ask In comments forecasting Derek additional maybe to here. add of terms

over they look unlike in these terms we individual samples large to because at well numbers. clinical Max, large. of tend as projects, essentially at forecasting, where we're So, a And XX,XXX we have lot and be fairly the looking business

individual. it's Here

the that we And the moving so, have if will, you and and we the program. look something each project we probability that stage, signed forward try to developed of estimate essentially is of a one at. And from stage of assess contract at state the or each on based an

it will have to a reach we think we activity occur. the to also forecast whether forecast do though signature, will only Not have we when not or

work, and be how try even we program look that at long that any work either FDA. in for the there will unexpected take may how and us hurdles itself in long the company assuming, our is to the successful do the into the and from will take requests account do work need award So or biopharma to of it

So has forecast have how putting our those all we biopharma together business. been that

the good individual which relatively is of a far always programs volume difficult forecasting, you samples. of compared when in so tens of clinical of have has thousands been reasonably number And it to terms small it's

Great. And forecasting. then just sticking on

in key what margins, XXXX expansion versus opportunities then XXXX. and the Just in drivers saw on for gross we

increase our biopharmaceutical business our margin in both proportion mean, increase been change a that's has gross any has necessarily So really in the not the of as in in ASP improvement gross the our as of products. The clinical only been well I of side the driver side. the price side on with simply margin, biopharmaceutical biggest

an the year the the PMA full to on reimbursement side, Medicare we a payer-by-payer substantially. On us grew lung. payer of for clinical year It reimbursements the private big found was specifically that basis. impact. indicate first for of overall the hard was course of increase had But Plus

LCD That's the in another Looking any we that will something QX. obviously the ASP. Pan-Cancer inflection ahead, expect in point something of is ramp benefit over year. major that terms not It's

We end increasing in as of to have across of full earlier reach expect start a I to the need year. a the projection of our see said stride sort that the so benefit by And QX. then QX, to you

payers, would XXXX actually to and expect term lung be payers takes would adopt we Longer longer saw private and goes that with likely the standard. that LCD, as Helmy mentioned, beyond. that although gradually begin And after into something we the Pan-Cancer, private for

final the on one TAM. then And Great. broad question

this previously included was mark final that testing original estimate? XXX upside regarding Or maybe repeat this some to into LCD your in would TAM baked So the estimate?

We for the of that's more could side. some there becomes testing initial as the TAM test testing average billion $X and for baked patient $X of a the TAM assuming assumption billion pharma in up. on that's billion how per two one then the set of terms $X But repeat is for TAM. longitudinal standards another that that $X think was more then obviously billion lifetime. In And be to an upside

Thanks. Great.

for Q&A call Talasaz our concludes this to CEO, turn go session. would over I At like ahead. This remarks. to AmirAli closing the Please you. the Thank time

we look Yes another thank to year. you. forward XXXX and and questions you all Thank good everyone great your for for a

this conference for today's call. and you concludes Thank participating. Ladies gentlemen,

may disconnect. now You