GeneDx (WGS) 30 Oct 232023 Q3 Earnings call transcript

Good day, and thank you for standing by. Welcome to the GeneDx Third Quarter 2023 Earnings Conference Call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. [Operator Instructions]. today's being that advised be conference recorded. is Please hand over at to would now speaker conference to like Dunbar I your the today, GeneDx. Sabrina ahead. go Please

Thank joining everyone you, you today. operator, for thank and us to

have the Feeley, results XXXX. Kevin Officer. for Katherine On third Financial we Stueland, and ended Officer; Chief released Chief GeneDx today, quarter President Earlier the and Executive financial XX, call, September

plans, including make take and business Before our may on of please guidance We note forward-looking we about today's call, begin, statement. cautionary statements our outlook.

statements at involve could and risks including and to we our quarter actual regarding Forward-looking view to ir.genedx.com refer definitions exclude release additional measures to call the that and results, and as results, no which materially items and measures, our Katherine. non-GAAP update. that, certain from under Please uncertainties earnings statements. to XX, slides we over from our factors our inherently non-GAAP results. reconciliations only cause and of refer for When discussing And of XXXX third with forward-looking of reflect today, I'll information are turn differ to obligation results a October discussion available reported

Sabrina. Thanks,

so right cover of going lot have call We in. jump a on our to today, news to I'm

results of strong Our nearly third year-over-year quarter in in margins million burn. cash were XX% with XX% revenue, gross $XX reduction and a

highest at the exomes of as of saw mix in nearly XX% in also September. volume We a coming percentage total

patients. of the in scalable revenue time, quarter, grow market have insights reducing the effective Our materially and been to clinical stronger. business industry-leading dove to never structure And The continue ways. cost same exome and and we of at and fundamentals and are X/X more this our genome we our almost offer our more

three our rates three, one, claim burn. around per efforts: We exome increase volumes; genome reducing to cash team and driving major increasing down denial two, and our revenue entire have organized test

is taking focused exome hold. Our strategy

of from market well panels our single exomes September, And the microarrays to transform genome. to is revenue and way. and XX% multi-gene we're gene goal Our our tests, in representing exome on with

in the core With from single continued tests sights conversion This on quarter, we an coming XX% time. up the we setting ordering year the saw revenue of neurology, quarter-over-quarter year count now in clinicians growth building with in XX% of to QX faster in neurologists multi-gene The aggressive million second and outpatient fastest-growing million. $XXX of range of the $XX QX, around million and we representing takes the a continue $XXX in clinician year, trajectory markets to our revenue growth. business. full exome our exomes ordering of a in in the portion expect our had half Pediatric centered the largest to growth new This make clinicians. number increase

We have business. just than the final longer moved complete. setting officially the we SemaX former That but through is stages anticipated, down of took

costs shutdown severance and final those Excluding costs. onetime

improve moving includes which That rate reduction today's to the vendor we force. spend we've million $XX which cash was forward. Our QX effectuated from from a $XX as operations as QX in is we plan continuing that steady-state of cost a approximately Today, well base, announced burn from reduction million. approximately plan burn in

of invest increases these responsible We in some paid in tangible are as We'll teams we're thanks progress, support they leaders finance operations, commercial, that for and key this growth technology. are the efforts that the and making and addition -- to across prioritizing efforts genome product in exome seeing claims. to and continue

grateful facility long the assembled, we the with in right we has have we in confident alone choices in growth we our our strategies task. way navigating our of flexibility come similar million to the that no and position team move to our and ensure most right announced companies as we're cash just waters. partnership I'm on genome debt R&D easy XXXX. living strategy we also include the we're This facing our with the profitability. of strength and in, from of with and investment we'll but earn a balance that burn Today, of to a of invest I effectuated, near fortifies is our possible. efforts know making are the a closer and sheet leadership in we're the Perceptive our I'm Some focused $XX have the business business But are once that Balancing prioritizes close plan in longer-term grow while our together and not these Other to Board deprioritized get entered cost-effective correcting been exome Advisors, market we course into in we proud offering burn team our provides that in them forward. challenges, the term. reduction removing balance of believing have of how meticulously view we've sheet that for in and with growth other clear-eyed

stay patience and the teammates the to committed You realize extend generous passion But for in are for to interest path drive and want you easy to order shareholders particularly are continued meaningful to continue support delivering I to the to that with to value. time today. incredible Kevin? winding introducing who No who technology and opportunity shareholder commitment our and in value do leaders path to vision. present, when those get us we immense have you And straightforward, patients make continue that where been nor a shareholders, health past a our new we've profitability navigating. the to on have impact to to that grateful all I of mission us committed is improve care. to thank we're team to despite thank invested so to an their and our we'll our

quarter revenues the third million the for were quarter million quarter. XXXX. of said, $XX.X quarter XXXX. and So $XX.X third the what it Revenues to I'll a $XX.X XXXX million of were continuing Katherine operations of repeat second million $XX.X from was strong Total in in compared

appeal third was genome XX% Excluding XX,XXX year-over-year genome compared increase benefit million the this genome quarter and this quarter. a testing, quarter XX% increase for onetime exome quarter year. a In XX%, second the of second coming in exome expansion continuing from revenues this volume third quarter XX% The generated this is and an was the operations adjusted XXXX, which of and quarter We represents the gross increased in the exome XX% XX% quarter quarter tests, Whole over year-over-year, XX% onetime $XX of X of increase a year. to margin appeal of the quarter. second XXXX, to increased XXXX, Adjusting year-over-year. from benefit XX% from third in the specific third to same margin places. and for compared this up from revenue

Test of The our quarter of XX%. as tests margin a To over adjusted gross margin picks all in represented more margins in the month and, production our of XX% products. Exome exome replacing up test of genome set, September. cases, in share lower the first will exome is negative Mix. continue third for to some volume, overall XX% level and Total gross margin remains with high benefit

remainder APS we cost The test per NovaSeq second our will quarters. machines the X per replace We next fleet and the to Illumina on cost live, right X the aim of at is test. have lower time legacy Plus several over now

We also have recently machine. received PacBio Revio our first

lower the to use cost by Beyond excited orthogonal is of this older sequencing collaboration, technology about long-read our potential the confirmation platforms. team here replacing

the base. analysis, number plans to platforms report Additionally, real by offered long-term completed library reduction a Automation [Tuas] pleased and underway further and to lower-cost now exome and we've already are writing the genetic are review AI of accounting preparation costs cost And we a cost near- with opportunities. today, while disparate steps Biosciences. consolidation improve where are initiatives or of certain offer across solution

The know Exome upon. over exome at over portfolio third gross third genome high average loaded despite rates. in XX% today portfolio be improved from we has operates opportunity denote average and slightly fully $X,XXX over from up rate that was $X,XXX was last to the quarter, reimbursement the a quarter. The on reimbursement margin The

have bring majority of The company market and and lead As technology teams we to access, product these billing, leaders denials, enhanced been the experience to and believe Katherine to efforts. brought to addressable. into new our new finance-related sales, mentioned, continue specific perspectives are

to million in That's and legacy further of XX% XXXX. reduction last delivered search separate reduced expense. now the a from We've down Total move again third the operating million second adjusted XX% quarter. in $XX.X Let's XXXX year-over-year quarter business and SemaX third of $XX.X efficiency. million costs for $XX.X from down as we once from and of of expense quarter for the the was XXXX, operating quarter

million reduce of $X.X will awareness, earlier benefit. For over a this the today. plan rationalization quarters with onetime affected cost This includes baseline the couple quarter next further

On $XX.X XXXX of second year, the $XX.X narrowed XX%, line, the loss million the this quarter adjusted in of compared net of improvements loss and $XX.X company the respectively. in and XX% bottom XXXX for to total quarter an third to net quarter adjusted third of million million of

$XX would for of quarter. cash final Our and costs been million otherwise onetime included SemaX million approximately payables the quarter million third $XX $XX nearly burn in have and

purchase the exercise plus rate will A to warrants Class the of entered with SOFR initial the is were A $X.XX September which of through to And $XXX shares. Personally, payable XXX,XXX today, on equal XXX,XXX price announce I Upon Our of work warrants in equivalents, credit tranche XXXX, subject of consisting to total subsequent we restricted capacity, Perceptive criteria. tranche, to is $XX to cash XX-day certain provides transaction. of X-year terms XXXX, That additional company's million have up with Interest for X.X%. of the XX, at the closing million, be shares team million, a price which hard October XXXX. we a in purchase stock and agreement the a issued into Perceptive share. be This for Advisors. to new cash, Perceptive an $XX cash agreement, that was optional VWAP. Perceptive of secured marketable of senior the under is would facility an securities million drawn and XX, involved committed thank And second issued an December want $XX tranche as Class at the barring an

We to net strong In proceeds pro our in initial are another September partner the at million. hand on XX, cash yet is tranche, thought $XXX.X the forma of giving mix. excited to have the rise XXXX,

Now guidance. turning to

obligations servicing with full half of business second year end XXXX expected the $XXX inclusive to to million range continuing We of cash between million narrowing in We're a for revenue from to million. to $XX the $XX million, $XXX the of expect a between guidance exited XXXX activities. operations burn range

As profitable expressed, as be the outlook a installment in payment of settlement. December the million we XXXX, $X legacy next in the respect to SemaX have turn to scheduled reminder, with And will remains XXXX unchanged. made payer

So by path to want that while to XXXX. at specific XXXX this are we're providing guidance long-term beyond end primary how to drives. point, speak X I view did we There not profitability the of

The first is rationalizing the expense base. operating

of Our several down out will the to operating a quarters. roughly our towards expense these million impact not $XX firmly costs next taking to reductions in an cost exome is We're over drive growth. believe million $XXX $XX million specifically or get current ability identified quarter rate adjusted million additional a We annually. $XXX run

XX%. reported We of QX The than margins our expanding XX% adjusted blended Remember, gross exome second is just today. margin by greater gross margin. are gross

exome to total continue more margin revenue, XX-plus towards of our make percent. our up test that So as moves

work. their believe reimbursement beyond We expand also level and can current COGS margins given exome reductions

reported revenue a revenue million just The growth. run QX of for operations million third is rate. continuing We or $XX.X $XXX

generates That XX% reasonable achieve X over even is said, that we growth were I given mentioned. level all to very this grew certainly in one the revenue growth growth exome next zone aim much structure past that. year-over-year revenue genome rate and exome assume lower quarter. and exome a future Our breakeven XX% years, just the a of than If stronger just cost the exome to

a balance more go-forward initiatives to operations $XX cash a So sheet, cash, to our to we've expect continuing you announced adjusted end substantially also XXXX. except was for clear operating revenue our margins to now exome Legacy payables minimal path settlement for which improvement therefore, And this section finally, margin even the any cost profit. to each today, growth primarily We, anticipate towards call and Katherine tracking as the the And net closely back burn as balance remarks. serve payer of debt see of million sheet saving point will show by current will closing and financing with continuing now proceeds fairly to our behind the CapEx. the sustainable should breakeven we SemaX to moderate loss structural on all as protection the trend put severance turn liability I'd of we huge in new terms quarter. approximately I'll basis, conform you and towards used shift cash us. other, levels, for

Our commitment to is our to XXXX turning in unquestionable profitability focus.

and treatment diagnosis, As today, our that the discovery and managing planned these with our of diseases growth, this are and using inheritable vision clinical with goal, cash genomic accelerate and all diagnosing market we've to to to commented exome the to to to ultimately lead and drug possible and business efficiency well development. backbone is In we disease realize X and data positioned our selection inform support drivers. management genome

by now, continuing our exome and patients. serve and value more creation on business while genome more focusing shareholders will drive For we our to for

it Now for to turn we'll back the Q&A. operator

Thank Instructions]. you [Operator

Our Dan Brennan Cowen, first comes line of line is question open. your from the from

It the with XX% out volume shift the like and XX% exome exome growth really seems growth Hey the in Joe for playing is and September. mix this story quarter in mix is Dan.

-- the implied down QX bringing in do what's fourth that's what see quarter the guide? changing So you

is way Yes. happy We're add QX part some the both out. QX. force, pretty is view Joe, the some exome how substantial commercial that's with seen to and team in portfolio. new members growth look, the think we played the the I did in quarter growth really in what field large we We've it driving and

of do and terms that. a patterns to. really in expect in uplift would pleased strong. And so ASPs. coming ordering of see the see is We October typically We're sight far. guide is reflective the what data we with line of QX We thus

range confidence I of particularly how the fell is ends range. just the But so the that at with this we second provided And guidance have year. of happy couple the can first that higher progressing hit in Really year half the the previous of that, we every high end here. we that short of of quarters

really of guide just So how was part of played the year reflective earlier the out. the

generally basis. into it. expect Got on to down XX% these quarters a to ASPs, they XX%-ish see you continue? about And looks like Or of XX% it 'XX? on Do came like blended you then pricing year-over-year in QX stabilizing do kind

I on. QX to No, we baseline think a as view which from improve

of versus incremental If microarray the near-term you ASPs other just second focus product bring an to in on a see you'd we've next front-end some the exome, quarters, we $X,XXX did the see $X,XXX in quarter quarter improvements in down a average that particular fourth progression our teams much And in they the after improving the all the second versus QX of not denials. the improvements range X focus years the identified in north processes are we've just uptick the in and with lines, quarter remarks, should on that with had the expect mentioned with of have. fourth rate as over in across focused received quarter. We'd hereditary nearly in the would several slight expect entirety as cancer. Frankly, denial exome.On we chromosomal company got as similar opportunities product in maybe those couple past in lines of

[Zeni] stay a Outside the the cancer, panels might rates blended and working go-forward ASPs those expect team on other lines, hereditary in basis. improving product flat, So exome CMA of on on particular. to you X on

the exome in we finding since Kevin opportunities add framed increase it saw nice to The terms in exome. and the I only that would that, beyond a way of think thing I

XXX are be We tests about in early XXXX. to going retiring

and really differentiate So a again, the that continuing well. on can us that on to as are focus business care P&L best the test the have positive patient for impact that

from? are can the And Got out. this great. on where would these it. see Where in of be you the coming we'll talk P&L last And then $XX cost million incremental about just kind just

development, then third coming sizable quarter day through of throughout the impacted group's some is to functions a force from We employees with necessary support midway frankly, as another reduction for we've actions and product as took primarily overall half some other technology the About the The is in away further and and support there, research today, and Yes. SemaX, fairly impacted from business then reductions. the go-forward gotten down. employee titrating day. subset separating

the And possible right activities And are from that base so as we're size as move quickly complete. we to shutdown. shutdown reacting further as further those now and cost away

taken the remainder around a our As earning pursuits and focus it longer-term we've to research of to really development. spend there, the way relates on

And with I payoff, projects respect beyond. think would XXXX to that so and reductions longer-term have

And respect margins and expand gross so longer-term have that feel it's confident the to to grow been line that to still top remains necessary those intact, down. trimmed everything with pursuits R&D

for you open. line Massaro our your our Thank next .One next question from comes line is Mark BTIG, question. of moment from And the

Hey you the reduction addressed million to from there reductions the guys, taking cost any and of that coming annualized sales or you is I crew. R&D $XX functions. support thank But for MSL questions. know force the most were

XX% think the you on in of range. the think the XX and I this just new finish second size Can you year on to organization? my half update reps are notes, onboard in planning the commercial based of maybe I XX% somewhere us to

commercial area of Yes. to for continue going organization an be The investment is us. to

product. we we slow surgically of are or part, any will say will growth eliminating that I removal integrity impact very would the So rules the not the the down that try most that ensures for to do

that through commercial the that and organization. we to that and be can the continue quality will drive meaningful continue we confident ensure really the leader to can growth feel we So market high remain

this on evidenced and as roles force, impact impact on filled sales the right So results the have of supporting we've of about and a them doing I functions no force, those Those X think, by sales MSLs. the no now. got, job been critically commercial are XX teams fantastic important The quarter. year,

to do at staffed, We then had close always just from to chance talk there's in time. team gathered of to week, of with capacity. are being that time them. So that our open roles expect fully that we were handful to And are they I going a MSLs be last the Gaithersburg have

I continuing, on really critically commercial a keeping in ability and important on collaboratively looking are profitability as that. drive they can hone strategy those are and So to overall MSLs focused working as future team do would continue the look exome we towards to we say, ensuring our at moving to and to forward, genome that account

Okay, thank you for that.

understanding lowered year full modeling of understand below revenue is QX still I'm you the So mean year. still significantly estimate. in, you your implied guidance, the revenue the still, to were but not I why come QX the XX% your needed that, back consensus I in of half We very this guidance. below

else you from what changed? traction But initial has required reps, been would pricing, us I through of work maybe as prior have you can expected. understand in QX payers. their maybe you assume terms with just I in terms would work what that that some of walk payers. have new in assume more onboarding as your I So going on is of guide wasn't high

plan and pay, have coverage traction you update some in give on you the of your the us maybe might new just the maybe with expected onetime outlook. of payments an can of timing prior So commercial some that broadly

Yes.

pricing. less it's payers a Mark, little think and I around

is around from two payoff we've we're starting show October through and denial the optimistic data fairly cycle. last to In in that fact, put from we reimbursement -- place are improving and efforts in including revenue a and the is perspective months through today, the

the marketplace into would We bringing original fairly at If chromosomal you had anticipated a on the exome. ramp just to see the from microarray talked conversion -- go about genetics CMA previously we guide, in that, or conversion than moderate long take inflection of sizable who've with tail bolus period in anchored time. of second executing, same to product a report rapid stepping a they back docs to as with added encountering end tests, it really exome commercial for the into teams more down physicians in and particular, And in what do we've exome of weeks. we've to tests long-standing our that ramp beyond, exome. from conversion quite a respect quarter practicing few point, the We've I CMA verbal We're days. think stones MSL been a out respect future -- seeds conversations as has education to One, way we those is been massive these to X of or we and some seen physician have the And not team months things. for we on engage to misperceptions that a got in for behavior. expect start should the

And respect seeing so and And in pricing. that seen of flattening with we're old that physicians, perceptions previous versus of report and ramp around turnaround behaviors the times, old significance conversion a be might are a expectations. we've among things perceptions all that mindset unknown entrenched to noise around variance

grown That rates is has pretty forward. primary similar growth the we'd portfolio exome So rapidly, and said, the expect going driver.

$X we're QX, similar fourth can to guide in CMA a million fourth in just revenue plus expect we the of QX quarter So to conversion. the and from go-forward as what a to of exome the posted expect we see quarter that something starting quarter, normalization for we'd terms

helpful. is That Okay.

looks the other XX% or would about year. Recognizing about up it the 'XX any levers So greater should reasonable readily higher in as the from your that of achievable. XXXX granularity commentary growth like be XX% helpful. models about of XX% mix growth guide we you think exomes. our for that be would than for revenue imply Is it a are picking midpoint or full But

earnings website there's believe to for revenue do prepared not Yes. what really a that I deck to materials as sketch our posted outline guidance. year providing tried of 'XX we're is in we out in -- We'll we which you profitability. to our if of an just so to believe is illustration come growth grew our in and breakeven early can you in we excess remarks, full about mark. assumed the firmly page there But and portfolio, to going path year-over-year to mean go-forward my January. base, really growth of And XX%. think get the if you well of And the all that around from beyond, even the exome

you And so year-over-year similar I believe moving really expect that should growth forward. exome

year If was earlier concessions from some end impacted you the recall, at price this we of offer to marketplace the year. next

So the should some. moving That's growth you all rate that believe and exome at worked point, ASP only system forward. on through played year-over-year with this the sequential expect improvements

to a So XX% we might we XX% what from rate posted this greater growth than year. expect year-over-year

Okay. any here? And gross were sneak if that from our level was modeling. can off strong that ops I That's The a Do QX? continuing margin there one. of and from last you Or helpful. well think adjusted timers above one that's build can one XX%, perhaps in you

level to it's test, the ahead To There outperformed few terms exome schedule. of But out my think stay. initiatives take a results base particular, we've revenue in to meaningful that cost around to that in items were per call onetime in test are efficiency seeing some those think and COGS. I of or opening in here tried cost per or efficiency gains provide and remarks. either a do point, we number a We ASPs Yes. in your are of. hold new no off work yes,

Thank me. you from it That's Okay.

line One question Brandon moment for line you. next will open. the .And your of come next from Thank is Jefferies, our Couillard from question our

all Thanks. This margin is gross Matt for there. Brandon. appreciate Kevin. color, sticking on I Maybe the with

in spiked we you a each one Or to gross having was X for of the in of terms similar kind of of think in outsized there about sequential is here kind that should XQ? the one those In saw an improvement driver improvement out we margin, buckets the there contribution?

those there. say, that with It's in in the test really of And the the from I a areas, both outlined them dry leading of cost per wet the relative the way I are -- number coming would and take laboratory. order side

Illumina process related. new as are The some Some off are paying is related, machinery technology from expected.

think of conviction additional comfort forward are going of what and is on. relied that got sight line moving items a large efficiency road the and gives forward most us can map be near-term I we've

leads them And outlined. cost started only down take of per way, into and probably That test in just the so ranked I can order we're getting one you exome. which driving in

it That's And when forward on out helpful. I that cost all the million taking structure, or be it cost could comes think that's today so supposed I more million wanted another $XX thanks. further it about for pulling pulling of not additional $XX to the custom of appreciate color million profitability your or reiterated $XX but the then to that out target are ask, get just outs. just profitability now using forward, on outs the trying cost so I XXXX, given coming meaningful of anything. mean hands those we around the target profitability to

came the made, XXXX of end as analysis. really XXXX. recent We're was marker of meant lower more $XX acknowledges this a the Yes, the efficiencies today to ensure I we meet on base of do the The think ability by million outside convicted we this we might commitment we of turn that. which we profitable than for review outset expected part than in company in -- found thought our Frankly, more revenue that year. a bit full to to the that

to to into aiming from careful would of course, revenue come think be pull be able to profitability overpromise. to I we're to which, growth, outsized XXXX upside wanted any not achieve, but

Katherine. one for last maybe I guess,

additional new we there things of you what Officer, territories, side, talk year? just You kind the on of commercial some so expect Growth should in made guys bit on Thanks. the more of side made of for lot have far little or things this a working like continuation a a or change any kind Chief just commercial and outreach needs that. hire of moves guys the have changes Maybe your programs, new about

Certainly.

who us go I in joined in overall off we commercial have September that terms want think, Duquette, of strong Melanie So in of just to to X.X where lead foundation take of kind to we a of strategy working version place, added the efficiency. the to commercial to

So are really, teams and focusing on to be growth cross-functional the really on I would working say, profitability, is, what we account more efficiently expect together. that

and say at revenue, on So a has would volume from when the overall company, done ASPs was team prior tremendous focused the volume shifting job she she to really focus on keeping I account her on profitability.

of looking shifts continued that's efficiency more growth. that terms and So those just for ensuring way some overall forward working we're of I would improvement say moving a with support working account are and the teams that singular and in in we're what on

So good up continued with align that it a P&L, we'll to in way but continue on on focus our delivering doing patient will on and markets focus opening care.

Thank you.

moment One question for next from line of Matt the question. Sachs. will Sykes our And our come Goldman from next

Kota evolving is you outpatient inpatient that over And Matt. for on This exome you time? do Prashant What testing? and split do see between see

Prashant. Hey Yes.

quickly. is the predominantly outpatient rapid portion utilization would setting. setting think I that in majority, growing small is XX% a genome inpatient, primarily the that rapid versus It's really setting business. of XX%, the focused product, on our I just exome outpatient is vast the the So today, say in in which though of a very genome

to wins building. at that's by is to continue said, that to being being longer-term utilization been of of fundamental think That really work to able I'm into market have a that Florida, NICU.So just There's a The the fall get drive through we to ensure a lot like order utilization. we be in in had health up we've system pay. rapid of that, I is dynamics some our win the going in nice to encouraged product that the drive contracts of that, utilized. vast to genome institutional majority where set able institutional inpatient category

time So also the removed for those. get XXX% that that's barrier one paid We obviously for us. on utilization have and both of we

we to That's But So going we of a pull really terms more utilization. time. view driving appreciate longer that being as take to business. in continue some that

still we're in to it outpatient going the about over think predominantly next we So breakdown that see as years, setting. several the

about percent Got if that denials just are long you how is And approved appeals And specifically, not progress in then claim it. have the Thank reducing roughly and your claims talk you. number? of you process? what can

Yes.

to the in new bunch did our claims we folks end-to-end processes, a look as talked about, really in particular a of on take we at So submission. of end bring front

So reduction this a uptick an in rate ongoing, see we denial a quarter. lot work all of in ASPs. is driven That's by the slight did and

the with certainly initial way pleased there. to long go So finding, a

we And north fresh was just confident XX%. it really that addressable. think our processes. your much to the I question, are To on feel important of of get denials eyes

improve and So versus rate low X the second, quarter although hasn't did while, a XXs is in the in third ASPs. percentage drove we That uptick that's changed our on what about today portfolio. in average exome denial the point incremental the

to begins is of take ongoing on the take I based as bites expect medical that us of really the us think to out longer going -- with effects process term, denial appeal back itself themselves claims to payers of passing with work unique re-adjudicate The necessity patients. the lengthy should circumstances and you to rate each hold. quarter incremental

an all at to moment. is today, denials ASPs more but have claims, therefore, driving the focused our I improving and avoiding down think revenue comes stood from and denied that's and important of We appeal process up effort where

the And makes raised one one could with I How That sense. if it. you've about last squeeze capital Got thinking new agreement? the you capital allocation are in. given debt

Yes.

the look agreement do took we company. do sustainably exome do priorities How really GeneDx the beyond. reducing way debt the for cost mentioned, reimbursement main today, couple we how How by on growth? I of find the to become then -- we reductions drive health it as think with XXXX is commitment and the I and that and financial efficiency meet denials costs exome improve in we that actions elsewhere placing emphasis we to to improve an the which, we cost new reduce at three reduction to profitable

of available get and ways technology those pursuits to And exome efficient so drive product all costs. with down three R&D any to is help allocated our to to capital the find allocated to more capital and supporting company

Okay. Thank you.

turn And Stueland today. would back now Q&A Katherine that to closing the to like conclude I remarks. will any conference Thank for for you.

Thank Great. you.

a to efficiently of grateful we and growing shareholders commitment do team it and as for Thank to business, many a conference. at you. support the look And from possible. you seeing are have management upcoming We strong as the continue of continued to our forward an

And this concludes participating. today's conference call. Thank you for

have disconnect. may Everyone, now day. You great a