Q4 2021 Sophia Genetics SA Earnings Call

March 15, 2022

Ladies and gentlemen, thank you for standing by and welcome to the Sofia Genetics fourth quarter 2021 earnings Conference call. At this time all participants are in a listen only mode. After the speaker's presentation there'll be a question and answer session to ask a question during the session need to press star one on your telephone if you require any further assistance. Please press star zero I would now like to turn the call over to your host.

Jennifer parties head of Investor Relations you may begin.

Good morning, and thank you for joining us on Sociogenetic Q4 fiscal 2021 earnings call. My name is Jennifer <unk> and I'm, the head of Investor Relations at Sofia joining.

Joining me today are Dr. Yankee candle on our co founder and Chief Executive Officer, Peter Kathy found out our Chief Biopharma Officer, and Rod Mckenzie, our Chief Financial Officer.

Before we get started I would like to remind you that management will make statements. During this call that are forward looking within the scope of U S Federal Securities laws.

These statements are based on management's current views and assumptions, which are subject to material risks and uncertainties that could cause actual results or events.

To materially differ from those projected.

Additional information regarding these risks and uncertainties are included in the section entitled cautionary statement regarding forward looking statements and exhibit 99 two of the report on form 6K on file with the SEC.

Except as required by law Sofia genetics disclaims any intention or obligation to update or revise any financial or product pipeline projection.

Other forward looking statements, whether because of new information future events or otherwise.

This conference call contains time sensitive information and is accurate only as of the broadcast March 15 2022.

Please note both the replay of this call and earnings release will be available on our website in the investors section.

And with that I will now turn the call over to Jeremy.

Thank you Jim and good morning, everyone 2021 was a transformative year for Sofia and I'm pleased to share with you today, our strong finish and momentum we experienced closing out our fiscal year.

Key traded company.

I want to take this opportunity to express my sincere appreciation to the 550 employees for their extraordinary efforts and dedication.

Our talented team drives our success and I am thrilled to announce that we were recently recognized as one of Boston.

The work for 2022.

Does tick achievement to start the year.

I am immensely proud of the success, we have achieved so far and then eagerly looking forward to what lies ahead in our ambitious journey to democratize data driven maybe.

On today's call I will touch on the impressive progress we have made in the fourth quarter and 2021 fiscal year as it relates to the six strategic pillars guiding our long term growth trajectory.

Our new Chief Biopharma multi Sir Peter is just a sample.

We'll then offer a more detailed look into our biopharma pillar and the massive but under penetrated opportunity that exists in this market.

Finally, Ross will review <unk> financial results for the crude and the outlook.

We remain fixated on six key pillars to drive long term growth and value creation first accelerating the expansion of our network to new customers adoption, so come to increasingly Tvs <unk> within our existing customer base third driving further innovation on our platform to grow them via free cash as we shoot for.

Both developing key partnerships and collaborations.

Leveraging our platform to drive further growth with biopharmaceutical companies and lastly.

Fifth strategic pillar is excelling aggression rally within Sofia.

Before diving further in I would like to remind those less familiar with <unk> III watts of power.

<unk> business model, we offer as a technology player in the unsecured space.

Over the last decade, there has been a dramatic increase in the amount of digital data being generated within the health care industry.

The ability to create insights from this data has led to an acceleration in our understanding of biology.

However, much of this data silos, preventing it from being fully leverage for the benefit of patients.

So fear, which also means wisdom in Greek has built a unique business model to address this untapped opportunity.

We developed the <unk> platform to take the data of patients today to inform on how to diagnose and treat sufficient of tomorrow.

So <unk> is a platform that lives in the cloud and uses AI and machine learning to analyze complex medical model digital else data to generate insights.

So Pierre represents a new category of software company looking data silos melting that script professionals work together as a community and deploy their collective expertise.

Through <unk>, we can enable the practice of data driven mid teen in any hospital laboratory for pharmaceutical companies around the world.

We keep at the center of a virtuous cycle and benefit from powerful network effects.

This means as the number of Sofia DBM users increase the volume of flow data input increases, which then leads to a further increase in actionable insights continuously being generated.

The platform improves and skills as more data is analyzed which had committed snowballs into more and more patients benefiting from data driven medicine.

Our software model was optimally designed to support rapid growth, which further strengthens our position for the future.

And now on to our six key pillars.

Starting off with our first pillar of customer adoption and network expansion.

As Gary institutions continue to choose <unk> as their trusted cloud based analytics platform.

We had a strong finish in the fourth quarter with a total of 791 customers across more than 70 countries.

The company's priority has remained on the growth of the platform in the U S market, which we view as <unk> largest addressable market at an estimated $8 billion for clinical oncology and rare diseases.

We're continuing to invest in our U S opportunity and firmly believe there is significant runway ahead of us.

We are pleased with our progress of Onboarding clinical customers in this region and are expecting several signed agreements with tier one institutions in the coming months.

In the Northern region, we added seven new logos in 2021. Additionally, we are seeing solid growth with our clinical customer base in the EMEA Latam and APAC regions.

Global level, we are matching our momentum in the room.

In the APAC region, we recently announced on boarding a leading Taiwanese genetic testing company calls.

Fever genomics.

This is important to highlight as it is the first clinical institution in this region to offer Sofia newly launched HR. This solution, which is one of our most exciting product offerings.

The validation of our solution by this important customer is already underway. So fever genomics from great success, while implementing our solution in a clinical setting president's HIV detection powered by deep learning algorithms embedded in our platform.

Beyond HRD, we are seeing substantial demand did not back for oncology applications.

We recently signed new customers in Japan, South Korea, Singapore, and Hong Kong.

Our continued success in landing customers across a broad geographic landscape is assessment of our talented team and execution.

We recently appointed Ken Friedman as our Chief revenue officer to lead our global clinical sales efforts.

Ken has more than 25 years of experience serving some of the most innovative providers of technology is it.

Keith is go to market strategy and execution will be a fantastic addition, as we continue our U S and global footprint expansion plan.

Moving on to our second pillar of increasing utilization within our existing clinical customer base.

As communicated on our last quarterly call, we employ a land and expand strategy that concentrates on winning new customers and then driving greater utilization of our solution baidu customers.

We are encouraged with the momentum we see users continuing to increase their consumption after experiencing the value of Sofia platform.

Total recurring platform customers grew to 382 in the fourth quarter of this year.

375 customers in the third quarter.

Total number of analyses increased to 66000 in the first quarter up from 62000 analysis in the third quarter, representing a growth rate of 6% quarter over quarter.

For us one way of growing is continuously delivering new content, which leads to our next pillar of expanding on your offering.

This is an instrumental part of <unk> and we are laser focused on driving innovation of course, how offering.

We continue to provide platform users with frequent updates incorporating new features.

<unk> seen later modalities and new services.

In addition to our newly launched HRD capabilities, we expect to unveil several exciting new products later this year one being curtailed.

Which was recently introduced at the Jpmorgan Healthcare conference in January .

<unk> is a module of the platform within our oncology applications curved path.

<unk> patients along the care continuum by better predicting an individual patient's disease progression and treatment options.

It provides user and indication specific comprehensive use of efficient molecular or can you and imaging data powered by robust machine learning algorithms.

We are extremely excited about this product and believe it will further differentiate <unk> as a tech company.

So if he is observational clinical study called deep learning for which was announced at <unk> in November 90 day to predictive model fueling curve.

The study Leverages machine learning enabled analysis of the aggregation of real work will T mobile data to identify them validate predictive signature associated with response to immunotherapy and prognosis of patients with metastatic stage four non small cell lung cancer.

Such signatures could help identify patients that are likely to benefit from immunotherapy versus that theyre, not as well as stratified patients according to risk.

We ultimately this will empower clinicians to make more informed therapeutic decisions for their patients and accelerate the recruitment of the right patients for clinical trials run by the Biopharma companies.

Since launching the study November 16 sites across six countries have signed up to participate.

This should contribute to over half of the 4000 total patients targeted for enrollment over the course of the study.

The demand that notwithstanding we have seen from institutions, including permanent academic centers and hospitals to join this study has been tremendous and 13 centers, including Umass I've already being activated.

We are pleased with our strong traction of this study and we view the positive reception from the participating sites is a testament to the high level of interest in looking to predictive potential off immediately.

State assets to large scale real World studies.

From an operational perspective, we have already enrolled hundreds of patients into the study and we will provide an update on preliminary findings task for this year.

And now onto our fourth pillar of developing key partnerships and collaborations.

A robust partner ecosystem is United by equivalent a noble goal to better the lives of patients.

We're achieving great momentum with our partners and enabling our shirts customer base to generate actionable insights.

We announced last July that we enter the New Orleans with Geo steered to integrate data between Gs Edison platform and Sofia DBM platform as well as commercial collaboration focused on co marketing and Baidu take recruitment in the digital oncology and Roger genomic analysis space.

We are currently working together on a new statement of work to begin developing the software infrastructure and architecture that will enable the direction on the exchange of data between <unk> platform and the Sofia platform.

Our partnership has been going well and we have already seen significant commercial traction in lead sharing.

This collaboration integrate 12 developments mentioned earlier, including her path and the deep lung Forest city.

In additional collaboration news, we announced this month that we signed a letter of intent with Ambry genetics, which is a genetic testing and clinical diagnostic company.

Our collaboration will be centered around our assured long term focus of leveraging multimodal data to accelerate research and the understanding of human diseases.

Of the many opportunities in this collaboration our focus will start on the charges.

Shifting over to the next pillar, which is further strengthening our biopharma strategy. This represents a massive opportunity for us.

While we have made excellent strides in enhancing our business in the pharmaceutical industry. We believe there is still significant market share to be captured.

He built the rating that in these important markets. We currently serve pharmaceutical and biotechnology companies as well as clinical research organizations. We continue to promote our current products and services, which we believe will strengthen collaborations with biopharmaceutical companies.

To head our dedicated EF 14, Biopharma, we recently brought on Pizza Accursed, a central Ashish Biopharma Fisher.

The executive team is thrilled to have Peter was a high degree of expertise and deep relationship in this area with more than 15 years of industry experience.

Joining us in January from Silicon, a global leader in precision medicine.

Breakfast Silicon that Peter was in the senior corporate develop and rollout temples and previously held leadership roles at Neogenomics, and Labcorp, which Kelly pharmaceutical strategies.

I am delighted to welcome Peter to the team and look forward to his contribution.

Later on the call Peter we look through our plants and positioning to further strengthen <unk> presence in this space.

And now shifting to our sixth and final pillar excelling operationally within the organization.

We remain well positioned from a capital perspective to execute our near term operating and strategic plans, while retaining a level of flexibility to pursue select strategic initiatives.

As Bruce will discuss later, we are monitoring market conditions and remained focus with our capital to continue extending aggressively as a company.

With that I will now turn the call over to Peter.

Thank you <unk> and Hello, everyone.

Im excited to be joining the Sofia team at this point in the company's journey and look forward to help strengthening the biopharma strategic positioning.

So here is a company that I have long admired for its mission driven business model and successful performance track record.

Biopharma represents a large opportunity for us given our cloud based architecture, a decentralized global model that allows us to adjust harmonize and analyze multimodal data.

This is valuable and unique data standing hospitals laboratories, and institutions that it's frankly difficult to get elsewhere.

Data bring a much needed heterogenetic dataset to represent the environment seen in the real world, particularly for areas like oncology.

The ramp up of the Sofia EDM platform on the clinical side as it turn feeding our unique ability to support biopharma and finding patients and associated biomarkers of interest.

This applies to trials and for marketed drugs as well as helping our customers understand the global testing landscape.

Together with our edge solutions. These real world data insights can scale and ramp up rapidly supporting future revenue opportunity.

Among the many exciting opportunities we see in the Biopharma arena. So if he is HIV solution stands near the top.

A step back HRD stands for homologous recombination deficiency.

HIV is a complex biomarker, notably important for PARP inhibitors that helps identify with our cancer patients may respond better to specific treatments.

<unk> could ultimately lead to personalized therapies that benefit the individual patient.

We currently have one European patent application and one U S patent application relating to a method to detect HIV, which will be used in our solution.

The solutions decentralized nature allows users to preserve ownership of data and save time, while also offering comprehensive genomic insights without compromising the data's quality.

In line with the strong traction we are already seeing with the solution. We recently announced the partnership with Astrazeneca to expand access to in house HRD testing across European laboratories and institutions.

<unk> as a partner further validates our model to democratize data driven medicine, leveraging a decentralized model an innovative platform for clinical decision support.

This is just the tip of the iceberg and we're excited to talk with other Biopharma partners around our capability to develop and deploy similar solutions globally with a focus on patients and technology forward approaches.

We expect this to be one of many biopharma partnerships that we will form on our journey.

The market right now is robust data has become front and center for most of the large pharma companies and are now instrumental sources to fuel both early adopters and newly formed informatics and analytics teams.

Intersecting across multiple stakeholders from discoveries R&D to clinical development health economics, and outcomes research digital health and commercial among others.

Each of these represent potential Sofia customers with the end goal of supporting the Biopharma industry with an enterprise wide data solution.

A lot of effort is going into evangelize into Sofia value proposition.

Especially as we continue to grow our genomics database and added other key multi modality.

These include imaging radio mix via the GE partnership and clinical and biologic features to develop test and validate our predicted analytics algorithms.

The addition of the radio mix feature extraction, coupled with genomics and outcomes data represent a unique and significant value proposition to the biopharma market.

It's an exciting time and I look forward to the opportunity to support the future plans for growth within the Biopharma space.

And now I will turn it over to Ross to review the financial results in more detail.

Thank you Peter we saw continued strength across the board in Q4 with excellent execution and operational efficiencies setting us up for a strong ended the year there were solid consumption trends across our customer base in the fourth quarter with total revenue growing 40% year on year.

The $10 $9 million on a reported basis, despite FX headwinds.

Which negatively impacted our growth by approximately 250 basis points for the full year total revenue for 2021 was $45 million compared to $28 4 million for 2020, representing 42% growth.

Growth in revenue was primarily driven by new customers added to our platform.

Bold with increased usage rates across our existing customers. Our net dollar retention rate for the full year 2021 was 142%, which is considered best in class among elite cloud based software company.

On quarterly revenue churn remained below 1% and our annualized revenue churn rate has remained at a historical low of approximately 3% of total revenue for 2021. Additionally, our LTV to CAC ratio remains noticeably above the coveted industry.

Benchmark of three times.

Platform analysis volumes increased to approximately 66000 analyses in the fourth quarter of 2021 compared to approximately 44000 analyses in the fourth quarter of 2020 average revenue per platform customer for the full year increased to 92000 compared.

$70000 for the prior year period.

Gross profit in the fourth quarter of 2021 was $6 $8 million, an increase of 40% compared to a gross profit of $4 9 million in the fourth quarter of 2020 gross margin was 62% in the fourth quarter of 2021 in line with the prior year period.

Adjusted gross margin was 65% for the fourth quarter and 64% for full year 2021.

Total operating expenses for the fourth quarter of 2021 20.

$27 8 million compared to $16 2 million in the fourth quarter of 2020 on an <unk> basis.

R&D expenses for the fourth quarter of 2021 were $6 4 million compared to $5 2 million in the fourth quarter of 2020 sales and marketing expenses for the fourth quarter of 2021 were $8 $6 million compared to $4 $2 million in the fourth quarter of 2020.

General and administrative expenses for the fourth quarter of 2021 were $13 million compared to $6 $8 million in the fourth quarter of 2020.

Operating loss in the fourth quarter of 2021 was 21 million.

<unk> to $11 $3 million in the fourth quarter of 2020 full.

<unk> full year operating loss was $71 5 million compared.

Compared to $37 $4 million for 2020.

Adjusted operating loss in the fourth quarter of 2021 was $17 6 million.

Compared to 10 $9 million in the fourth quarter of 2020.

Adjusted operating loss for 2021 was $61 5 million compared to $34 $2 million in 2020.

Net loss in the fourth quarter of 2021 was $21 4 million or <unk> 33 per share compared to $10 5 million or 22 per share in the fourth quarter of 2020.

Adjusted net loss in the fourth quarter of 2021 was $17 9 million or 28 per share compared to $9 9 million or $21 <unk> per share in the fourth quarter of 2020.

Net loss for the full year 2021 with $73 seven.

$7 million or $1 33 per share compared to $39 $3 million or <unk> 93 per share for the full year 2020 <unk>.

Adjusted net loss for the full year, 2021, with $62 $3 million or $1 13 per share compared to $35 7 million or <unk> 84 per share for full year 2020.

Cash and cash equivalents were approximately $265 million.

As of December 31, 2021.

With respect to our capital position, we believe we are well positioned to execute our near to medium term strategic and operational plan. We will continue to selectively invest in our business to drive growth, while maintaining a strong capital position and the optionality to pursue strategic initiatives, including both.

Organic and inorganic investments.

Now, let us turn to our guidance and outlook consistent with the forecast we provided earlier in January Sofia expects full year revenue for fiscal 2022 to be in the range of $51 5 million.

$54 million, implying growth of 27% to 33% with respect to our quarterly revenue cadence, we would anticipate our results to be slightly more second half weighted versus 2021, given the timing of several key product launches as well as the anticipated ramp.

A key new business wins overall, we remain confident in the momentum of the business as we build an even stronger Sofia in 2022 and beyond with that I would like to turn the call back to <unk> for closing remarks before taking your questions.

Thank you Ross after a successful forgettable year in 2021, our focus shifts to Sophie's picture, we're extremely proud of our performance, which we believe reflects our continued ability to execute our vision and the opportunity ahead.

Our six pillars remain our foundation to drive growth and value creation for this year as well as the years to come.

I am encouraged and as confident as ever about the long term path that we have embarked on.

We have a fantastic opportunity to drive compelling returns and shareholder value.

As they reach the end of my closing remarks, I am pleased to announce that Sofia will be hosting an investor day in the second half of this year.

Tuned for more details to come.

Thank you to our partners customers investors and employees for joining us on this journey without you. None of this would be possible I look forward to continuing to update you on our future success of democratizing data driven medicine.

<unk> you May now open the line for questions.

Ladies and gentlemen, if you have a question or comment at this time. Please press. The Star then the one key on your Touchtone telephone. If your question has been answered.

Press the pound key.

Our first question comes from <unk> <unk> with Morgan Stanley .

Hey, guys good morning, and thanks for the time here.

Maybe one for you Ross to kick things off can you just walk us through your assumptions or the low versus the high end of the guide and then perhaps lay out what's excluded from the guide at this stage.

Yes.

Good morning, Jeff This is youll gain.

And they leave.

Russ on through the rest of your question.

Thanks, Jay for the question. So I would say, obviously, a number of different variables relative to <unk>.

Utilization assumption is ramping of new business.

Also FX we did.

Noted in the prepared remarks half.

Unexpected I would say detriment in the fourth quarter and we're continuing to see some of that in the first quarter. So so a lot of it is frankly just relative to <unk>.

Some of the uncontrollable factors, we have in the business, but overall.

I would say.

Relative to what we presented we tried to offer what we have extreme visibility on right and clearly as you pointed out there's a number of pieces, whether that's around some of our pharma contracting whether that surround the HRD, whether that's around our relationship with GE and some other Ella.

<unk>.

That can provide incremental contribution over the course of the year, we're very fortunate to have a business that's incredibly visible and so we wanted to present something.

That we felt based on our backlog that we were carrying into the year as well as the bookings momentum we saw in 2021 and the utilization trends are something that we felt very comfortable with at both ends of the range.

Got it that's helpful.

And then just just on the point you made about about visibility you guys. I mean in terms of things like labor shortages in hospital or is it perhaps shortfalls in cancer screening volumes are you seeing any of those sort of did any of them impact January and have those trends improve here into March and can you comment on customer appetite.

Try out new solutions, given the uncertain operating environment <unk> and <unk>.

<unk> pressures.

Thank you Jess so indeed, the current environment are being I would say.

A bit unpredictable overall, writing the worth now said that you may remember that.

Where are the key or fortunate with our business to support that kind of makes sense. There is primarily.

And so in terms of the volumes of patients there.

Their volumes are not <unk>, right with COVID-19 or as well with what's happening now in Ukraine.

So we don't see an impact on the volume of activity of our clients in the platform that is updated every hour and so we haven't.

Any view on what's the consumption of the platform.

We haven't seen that in general we haven't seen that in February we haven't seen that in March and they would say.

Thanks Scott.

In the end, it's efficient set the other way so we didn't benefit from this type of testing and then maybe as well.

And options that they could benefit from.

Now in terms of appetite to just we do see a lot of appetite in particular and I think we've been quite clear about that but regarding HRD testing.

As you may have heard that as well now a PARP inhibitor has started to be used as adjuvant.

Breast cancer treatment.

So people understand that many more patients will have to be tested with the HRD score and we do see a lot of demand there across the board from Opex to run two Latam as well as.

Europe .

Yes, just got an answer what <unk> shared.

I would say in terms of the first quarter.

It's always tough to ascertain sort of certain factors right and what drives I would say overall.

Madden has been pretty consistent.

Strong throughout the period and so we've seen.

<unk> the notes from from peers, and frankly haven't seen that same level of volatility that being said I would say on the new business side.

It's a really interesting period for us, we're seeing I would say unprecedented activity with very large customers.

So the size of serving rfps or quotes are much bigger than what we have seen in the past in some quite significant.

That being said I do think decision, making particularly in the early part of the fourth quarter likely was impacted right in terms of folks being distracted in January but we've certainly seen I would see continued activity throughout the quarter on the new business side, and frankly overall for us I am as encouraged as ive been around not only the <unk>.

Size of the conversation, but the types and the players that were.

Discussing with them. So I would say overall, it's still quite a healthy environment for us, but obviously as I mentioned when I answered your question with respect to the range. There are some things we can't control and you can obviously see the situation in the Ukraine, what that's done to some currencies and so that's probably for us more of the volatility.

The underlying I would say drivers of the business.

Got it and then one final one for me here on GAAP ask you could you help us.

Put some numbers or perhaps I use this opportunity.

In the past you've sort of mentioned the radiologist and pathologist being the initial demographic, but longer term there is a broader opportunity among payers, who could be interested in multimodal data as well.

Help us think through some of the addressable market sort of implications of Capex.

So.

<unk>.

I can't disclose numbers regarding the addressable markets suggest but beyond that I think that given Europe .

Switching on something very important.

It's an opportunity for me to share with you again on what is a revision like right. So we believe that they will be a second player that will break data silos across hospitals and data modalities and in particular in cancer.

Enable hospitals to basically monitor.

Time real world sufficient cases versus other patients that suffer from the same type of cancers that are being treated with <unk>.

Different type of therapies for it and so by doing that one can start clustering patients to better empower oncologist and making decisions when it comes towards the most promising treatment path as you may remember, we launch and therefore can declare path for <unk>.

The plan for cancers, so stage four non small non small cell lung cancer.

Which are efficient such today, primarily benefit from immunotherapy and where actually there is not great predictive model to know who will benefit from the therapy, and who will not benefit from that therapy and as you know immuno therapy becomes more and more prominent in cancer right. So which gives you an indirect sense of the size of the market and so the numbers that.

We are being a liking this quarter are more related to our adoption of the current bus in the context of the deep lung for where we said that we are being already able to actively activate 16 sites to run this clinical trial, a clinical study, which is tremendous right because as you remain remember to just we announced the launch of the study.

In November last year at <unk> and since then we are being I would.

Very appealing to many and being able to attract 16 sites across six countries, including recently Umass and then we're going to present the fruit spreads.

<unk> this year beyond the clinical markets, where the current basket served the oncologists as I was explaining this is a extremely important of UC as well as for the biopharma to deliver to the market more targeted treatments, so which isn't it.

With our technology.

Got it very helpful. Thanks, guys.

Thank you have a good day.

Hey.

Our next question comes from Mark Massaro with BTG.

Sure.

Hey, guys. Thank you for taking the question I guess.

So you talked about.

We're seeing unprecedented activity from large customers can you give me a sense for how much of this is coming from academic centers, our labs in the U S versus maybe hospital labs, and our Biopharma globally.

Yes.

Good morning.

So indeed as you may remember right, we've been primarily serving academic centers from inception.

As you know are very sophisticated centers and I think this demonstrates that the uniqueness of our technology right because to be able to penetrate these academic centers you need to come with the technology.

That is highly <unk>.

<unk> and.

And more recently, we have been announcing important.

Contracts, we've been signing with some reference labs around the world saw.

Last year, we announced.

Great being upgraded with our HR the capabilities. This quarter, we announced so few about genomics in Taiwan being upgraded or actually adopting our HRD capabilities. Another private plan and as you know there was always a question whether it's technology players like <unk> with great success in the U S for a more.

Samples are going to the reference lab and at the Central Labs risks other countries, which are much more decentralized.

So the good news is that yes, we do see traction you may have seen our press release.

Ambry genetics, where we are.

Partnering so that we will be able to eventually support.

All of their buy it from a technique and we see the same traction with menu other reference labs in central labs in the U S. Right now Marc and I think to some extent.

No.

The industry is becoming a more sensitive about industrializing solutions and so favoring technically you would like Sophia who can bring robust.

Today outcomes from our platform rather than them felt there on value from our 16th right.

So we expect to be signing much more of these type of contracts in the future and by doing so grow.

All of our business and the neuron market.

Okay, then I would just add.

Onto what Youre.

Go ahead, Russ I was just going to say Mark I'd just add on I think obviously these deals are larger and more complex and take a bit more time, but I think it's.

Interesting if you look again at our activity levels in the business. It's interesting the number of players in the realm that.

He spoke to in the U S and ex U S that are all coming to I think a similar conclusion at or around the same time right. So to me it feels like there is some shift and.

In recognition that elements on the data side arent core to many of these businesses and or they need to have someone like us who's a technology enabler allow.

Allow them to achieve sort of the strategic merits that they want to strive for in a cost efficient way and so I think.

That's very encouraging for us and it's frankly, a new development over the last number of months.

Again quite excited about what I'm seeing and the activity levels and hopefully we will have more to share with you over the balance of 2022.

Okay, and then as we think about care path.

Talking about your math I think you talked about 16 sites have adopted.

And how should we think about the rollout of care path in 'twenty, two maybe into 'twenty three and then I think you talked about a study that we may expect to see at <unk>. How should we think about just care about rolling out and any data readout.

Our readouts over the coming year.

Yes, so the stage we're in basically Mark is a stage, where we are demonstrating the value of following this.

<unk> data longitudinally right and we.

We decided to start with the non small cell lung cancer stage for it.

For patients that are being treated with immunotherapy, because I'd say, what's hitting two stages.

There is not good biomarkers to predict who will respond or would not response to them.

And these type of treatments are expensive and can be toxic Tesla right. So we skirt path as one is gathering data.

We believe that thanks to our machine learning techniques, we will be able to create a whole host of patients. So basically gave us more informed perspective to the oncologists on what would be the chance for that next patient versus other efficient to benefit from immunotherapy.

Along those lines.

Market.

Market adoption is anticipated not before we start disclosing the numbers right. So we are building, it's really step by step first for non small cell lung cancer as I explained.

First data will be.

Close to the market in a school following what's we're going to continue to study and just as a recap. The study aims to follow 4000 patients on seasonality and should end by 2023.

If you like for this potential predictive capabilities Marek you shouldnt expect that surplus being <unk>.

Commercially before end of 2023.

Our site to that as we do so we are.

Building capabilities for the Biopharma industry.

And we could before we release the results of the final results on the <unk> four study already leverage on a recurrent bus capability to add to the Biopharma industry basically further Tyler to these type of studies, maybe Peter you want to give a perspective of what's the power of our model.

Here versus what you have seen in other companies, where you add the seniority their ship rose.

Yeah sure. Thanks, Jeremy.

The deep long four study is definitely a very hot area right now.

In the Biopharma conversations that we're having particularly around.

As you already mentioned how can we look at these patients longitudinally I mean, I think thats the key.

Really understanding.

Their treatment outcomes in coordination with their genomic radeon data and to have a platform that can follow these patients in the real world.

It is critical right and so I think the other key piece. There is now we're having conversations with biopharma.

Essentially.

How we could stand up care path.

For clinical trials, so I think when you straddle both clinical trials and real world data.

The market potential it only becomes quite large.

Yes that makes sense. My last question, obviously, you have strong visibility with your base business.

That keeps clicking and resonating around the world.

But I'm just curious you've talked in the past about.

Pursuing digital pathology spatial genomics transcriptome ex metabolomics and proteomics.

How do you balance maybe some of the investment.

In your base business.

Winning new customers versus investing in new platform in place for the future.

Sure Mark.

As you May remember, our philosophy is first to be able to support labs in the chemical market as well as biopharma companies.

That data that already exists today right.

And so.

Aging data are the framing them in the field of cancer, two ferraro interesting that efficient genomics data have started now to be adopted of course pathology information is very important but there are still a few.

Scanners to digitalize the slides out there in the market.

Our philosophy is that as this type of technology as we move from the life science field to the clinical market our platform needs to be right. So that we can onboard this type of data both entities, but along those lines maybe on the Biopharma SHP Terry can give you a sense as well of what is yet.

Tight and the demand to date for multi modality diverse omics datasets.

Yes sure Thanks, Jeremy.

So mark we're actually having these conversations with Biopharma right now.

They're looking at what we're doing on our version of multimodal, which has been I think focus more so on genomic and radio mic with.

The clinical data.

<unk> Biopharma have other ohmic data that <unk> been generating with.

Partner Labs.

Mentioned digital pathology for example, that's just that.

It's definitely been a sort of a hot.

I don't know if you will because they know we already have.

The infrastructure and the algorithms to do imaging segmentation for radio mix. They want to also bring in there.

Digital pathology data and add that as yet another day.

Data stack that we can bring in include into our predictive algorithms.

So whether it's us doing the digital pathology segmentation or even just kind of bringing in their own.

Segment of data from our partner they need they have been working with either way they see the power of adding that plus radio mix in genomics and clinical and so you just kind of continuously adding these these layers in these data stacks that then it just increases and helps with the fidelity of the algorithm right. So I think digital pathology for sure.

And then we have some others.

Some other sort of genomic type data as well as proteonomic data that they want to also bring in so.

That's why that's where this is heading and that's why we're excited because it's really going to make these predictive algorithms.

Stronger as we move forward.

Okay, Alright, that's it for me.

You should.

Yes, Okay. Just one comment around that obviously were very careful about cash management and maybe Russ wants to make a comment around that yes. One other thing Mark just to keep in mind right. We already have a fairly I would say establish commercial model in our product market fit right for our.

Our platform and so in that sense, our LTV to CAC remains really robust frankly, it may even be too high right now and so in that our commercial investments are yielding incredibly strong returns and so that really allows us to think about the number of these opportunities and also utilize partnerships, which tend to be <unk>.

Efficient and so we were fortunate in our model that we're able to balance many of these ambitions being.

Being a software player without having to materially ramp up spend and so on that.

We're able to move into many of these exciting growth areas like maintained I would say the operating burn and profile you would expect for a business like ours, which differs from many of the other peers right traditional peers in the life science space.

Thank you. Our next question comes from Dan Brennan with Cowen.

<unk>.

Great. Thanks, guys for the questions Youre welcome Peter.

I guess my first question would just be on the 20.

22 guide so you grew 42% and 21% ex FX excuse me.

The 45.

The guide this year I think at the midpoint about 30, obviously, you've got some of the omnicom impact still but I'm just wondering.

Is that just conservatism or are there other factors considered with the step down in growth.

Thank you Dan and good morning, So first thing.

I would say Dan we are very proud with right to vote to this growth 42% year on year has been tremendous for Sofia.

And Russ can give you more color on your question yes.

And just philosophically right, we want to set realistic expectations and again, our business is super visible right. So our goal is to consistently be able to perform rider outperform and so you should think about that.

And we're relatively conservative.

As a as a team in terms of how we externally communicated. So you should think about that in the context of the guide, but I would say I would certainly not to think about.

The growth that we've guided to the 30%.

It's not being still quite strong I think it's a very robust environment, obviously as I've talked about a bit we will see from an FX perspective at least in the current market a reasonable headwind year on year, but I would say aside from that we hope to be able to share with you consistently strong performance and again as as the macro.

Hopefully does not deteriorate.

At least further from where we are and we consistently outperform and you see from US several of the other exciting things we've alluded to on this call. We hope to be able to continue to deliver strong results over the balance of 'twenty two.

Great.

Thanks for that maybe maybe on the U S side, it's obviously a.

Critical growth aspect.

Focus for you as a percentage of revenue picked up here in the past couple of years can you just I think it's around 10% or so can.

Can you just walk us through kind of your mix of customers in the U S. Today.

Between AMC and maybe some of the larger.

Maybe more reference lab type customers and while our community.

Is what can drive a bigger inflection in the U S growth rate here to see it become a bigger part of your business going forward.

Yes. Thank you then.

As you May remember right. When we started in the U S. We started really with academic centers and we are being shaving a number of names which are really tier one.

Institutions like more feet or Mayo clinic and others.

Users end customers of our platform now as you know a lot of 10 folks as well go indeed in the U S to reference labs in Central Labs.

And we are seeing more and more traction there without those type of labs, and we just announced this week you may have.

I've read the press release regarding the letter of intent, we have signed with Ambry genetics, which I think kind of highlight what we can do with any reference labs in any central labs as being an enabler right for their own business. So this will be definitively a way to grow for us in the U S. Beyond that's done.

So penetrating these accounts in the U S. We can grow as well.

Immediately mobile capability and this goes as well in line with what we have been discussing again with Ambry genetics for Mayo clinics will take two examples where beyond genomics, we're starting together as well too fueled capabilities, which are immediately model two combined genomics and radio mixed data and lasting that journey.

Our partnership with GE, which is already very well set right now in the U S labs and hospitals with VNS through retro for Sofia to penetrate the market.

Great. Thanks, Vivek, maybe maybe.

In terms of the ASP per per customer.

Is the right way to think about it kind of in that.

Mid single digit plus type of level or as you add these capabilities could there be an inflection and kind of the revenue capture per customer going forward in a moment that big.

Russ.

Sure. So I would say on the ASP side, obviously, we've had now for many years, a very favorable trend I would say consistently it should be certainly apples to apples.

That mid single or low to mid single range I would say overall right. It will very much depend on product mix.

And how the market develops right. So you think about the shift to larger panels, you think about adding on incremental capabilities over time, and radiometer sort digital pathology or some other areas those are going to have different impacts right on the mix and on the ASP and so I would say overall.

<unk>.

We feel quite confident that our percentage of the total value share of the patient or diagnostic will go up materially over time.

And I would say again, maybe going forward, we will try to provide a little bit more color on same store ASP movement versus overall ASP movement, because again I think mix will have a huge.

Packed at periods on how that May how that may trend and so with that I would say stay tuned, but again overall, we feel quite confident that as a percentage of that total diagnostic or or patient cost.

Our value share is moving in the right direction and less along those lines.

Dan.

And we are very welcome as well the fact that <unk>.

More and more things are going to be regulated in aerospace because this should increase as well the reimbursement proficient.

Genomics and behind.

And as well.

Say makes the market bigger.

Because for not the early adopters, but the later adopters, having a regulated market basically reassures them right on the fact that they will be able not only to support efficient, but will reimburse for this activity. So along those lines again regarding HRD, which is something we've been speaking a lot about we.

Have a good hope that this paper analysis will be significant tissue barrier to what we have today in terms of SP and that they should contribute on our seeing our ASP go up as we have being seeing over the last.

Eight years.

Great and then if I could just sneak one more in just on Biopharma.

How do we think about the impact on your revenues and kind of profitability as biopharm becomes grows as a percentage of mix. So.

Could you help us think through like what what's assumed for Biopharma contribution this year.

Could we expect to see additional agreements like the Astra agreement and then any comment upon kind of where biopharma could go over the next few years.

This is a bit early to assure we view then we'd like to assure a number it's on things where we have.

Rusty Supreme visibility right and so this requires having already in ongoing business, but when it comes to numbers.

And traction Peter it kind of it like that.

Number of discussions, we're having right now with a pharma.

Yes sure. Thanks.

So the Biopharma is definitely.

The number of conversations.

<unk>.

Picked up quite a bit I mean, we're now speaking with 18 of the top 20 large pharma.

Globally and so these really range from.

Our genomic insights real world data to the multimodal studies that we've talked about all the way through to new product launches like HIV.

So while we can't give the the <unk>.

Revenue mix today, I mean, just rest assure that.

These these conversations lead to more proposals more proposals lead to more bookings.

Great Alright, guys. Thanks, a lot.

Again, ladies and gentlemen, if you have a question or comment at this time. Please press. The Star then the one key on your Touchtone telephone.

Our next question comes from Julian <unk> with J P. Morgan.

Hi, Good morning, Thanks for taking the question just a couple of follow ups regarding a deep one study could you give us a sense of a timeline and what when we might expect a product to be commercialized around it.

The main study that Youre planning to run at the Beach head are multimodal.

Potential indications that you are planning to pursue in parallel.

Yes, good morning, and thank you Julia.

So couple of answers rights to your question, which is.

It's an important question. So as we are being cleared. So we are building this platform to be multimodal right and so this is extremely important to be able to closer patience and basically given also the oncologists are more informed perspective of one how would a patient to a given patient looks like.

Other patient and so in this context, we started.

<unk>.

Module in the platform with a deep lung for data, which intend to basically following this 34000 patients across about 30 sites for the next 18 months now.

So that we would it be eventually able to equip oncologist with new ways to follow patients, but on top of that as well be able to eventually predict which patients are suffering for non small cell lung cancer would respond or not response to immunotherapy.

And thats important because as Julian therapies have become very prevalent but in the meantime are very expensive and there is no clear biomarker that can explain who will benefit from this type of treatment or not so in terms of products to answer. Your first question in the clinical market, we don't intend to sell this curve faster.

Related capabilities before the end of the study right because we have to make it very thorough and we are looking at raising as well under design control to support our claims.

Beyond that the curve has capabilities are very important for all of those type of cancer is to answer your second question until we contemplate two launches with other cities.

Truly around brain cancer eventually around.

Breast cancer to be seen but indeed, the platform capabilities on the correct path of being used so that they can be universal and holistic to any type of solid tumor and thats a very important point. So thank you for the question last beyond the clinical market, we can already leverage on the current path with the <unk>.

Pharma right and Peter and his team today are being.

Having discussions.

Discussions over the last weeks with 18 out of the top 20 pharma worldwide, including our tariff bus capability to eventually as well support real time real world clinical trials.

Decentralized way, while harmonizing and collecting that data into our platform and in that sense to finish Julia the GE partnership as well it's important for us because.

If we connect the <unk> towards the Edison platform of Gee, we can accelerate as well the collection and the art or monetization of imaging data as well as clinical data that's already being collected by the Edison platform locally into this site.

Thank you that's very helpful color.

And then just in terms of.

Large central labs and.

But you're right.

A number of large customer announcements in the coming months.

Is it possible for you to give us a sense of you know.

How many central labs, you're working with or in discussion in the pipeline today and then presumably these central App customers are stickier and you run at a much higher pull through versus your regular customers.

Do you think demand the whole menu.

The pieces of the workflow I mean is there a different way.

The central lab in terms of the capabilities demand or their willingness to share data and <unk>.

How should we think about pricing and profitability profile of the central estimate.

Yes. Thank you Julia So first I cannot share with you number as Fred regarding are facing but what I can tell you is that we're discussing with.

Most of them today.

And to answer your second question, we're discussing with many of them.

Different type of application is very rare that it's to cover all of their needs because stem cells have already established solutions for some of the testing that they already have been routine.

Now.

Reached a bit different so im really that we just announced could be indeed, a very broad and global partnership to eventually cover all of their needs.

And I think this is obviously, what we aim to do with any rights, but our jumping in Juliet is very.

Meticulous first we need to demonstrate the central labs that we bring benefit for a specific application such as HRD or such as gene fusion detection or eggs on data computing and once we have done that we move to the next tablet catch and right to the next project and so this is how we are seeing always growing.

Well in the academic market for these so called land and expand business with us when it comes to the stickiness.

From what we have seen indeed, the type of partnership that we have build with our central lesson reference labs like that.

And it was being very public about that.

<unk> always very long lasting very close.

And so in terms of the ability of soft yet to be a would say embedded in the system.

BD profound but say that's just as a reminder, our churn rates even in the academic centers is very low.

Hello, 1% a quarter right. So.

We.

I would say benefit from the efforts. We initially set in the academic center note to grow in the U S with the central labs, but we don't operate the growth very differently than what we have being experiencing with the academic centers, which is something quite nice frankly, because it means that in terms of execution our recipes work.

Very well as well in the central labs.

Okay Super helpful. Thank you so much.

And im not showing any further questions at this time I would like to turn the call back to you argue for any closing remarks.

So even there is no more question I would like to thank you all.

Having heard that we're earning call and Q&A session today same tune and.

Indeed, you can expect news from us in the next weeks and months as we are penetrating the U S market they bring.

Our capabilities to the Biopharma space as well as building our amenity mobile capabilities. Thank you all and have a great day.

Ladies and gentlemen, this does conclude today's presentation. You may now disconnect and have a wonderful day.

[music].

Jennifer potash head of Investor Relations you may begin.

Good morning, and thank you for joining us on Sofia Genetics Q4 fiscal 2021 earnings call. My name is Jennifer Pottage and I'm, the head of Investor Relations at Sophia joined.

Joining me today are Dr. Yankee candle on our co founder and Chief Executive Officer, Peter Cassidy Fargo, Archie Biopharma officers and rock Newton, our Chief Financial Officer.

Before we get started I would like to remind you that management will make statements. During this call that are forward looking within the scope of U S Federal Securities laws.

These statements are based on management's current views and assumptions, which are subject to material risks and uncertainties that could cause actual results or events to materially differ from those projected.

Additional information regarding these risks and uncertainties.

And in the section entitled Cautionary statement regarding forward looking statements and exhibit 99.2 of the report on form 6K on file with the SEC.

Except as required by law does he have genetics disclaims any intention or obligation to update or revise any financial or product pipeline projection or other forward looking statements, whether because of new information future events or otherwise.

This conference call contains time sensitive information and is accurate only as of the broadcast March 15 2022.

Please note both the replay of this call and earnings release will be available on our website in the investors section.

And with that I will now turn the call over to Jacky.

Thank you Jim and good morning, everyone 2021 was a transformative year for Sofia and I'm pleased to share with you today, our strong finish and momentum we experienced closing out our fiscal year as a publicly traded company.

I want to take this opportunity to express my sincere appreciation to the 560 employees for their extraordinary efforts and dedication.

Our talented team driving our success and I am thrilled to announce that we were recently recognized as one of Boston.

Work for 2022.

Seek achievement to start the year.

I am immensely proud of the success, we have achieved so far and eagerly looking forward to what lies ahead in our ambitious journey to democratize data driven medicine.

On today's call I will touch on the impressive progress we have made in the fourth quarter and 2021 fiscal year as it relates to the six strategic pillars guiding our long term growth trajectory.

Our new Chief Biopharma multi serve pizza as guests of sample.

We will then offer a more detailed look into our biopharma pillar and the massive but under penetrated opportunity that exists in this market and.

And finally, Ross will review <unk> financial results for the period and outlook.

We remain fixated on six key pillars to drive long term growth and value creation.

Accelerating the expansion of our network through new customers adoption.

Increasing utilization within our existing customer base.

Third driving further innovation on our platform to grow them via free cash as we shoot for.

First developing key partnerships and collaborations.

Leveraging our platform to drive further growth with biopharmaceutical companies and lastly, <unk>.

Strategic pillar is excelling aggression rally within Sofia.

Before diving further in I would like to remind those less familiar with <unk>, what a powerful business model, we offer as a technology player in the unsecured space.

Over the last decade, there has been a dramatic increase in the amount of digital data being generated within the healthcare industry.

The ability to create the insights from this data has led to an acceleration in our understanding of biology.

However, much of this data a siloed preventing it from being fully leverage for the benefit of patients.

So if you we chose Cummins wisdom in Greek has built a unique business model to address this untapped opportunity.

We develop the software platform to take the data of patients today to inform on how to diagnose and treat sufficient of tomorrow.

So if you have the damage of platform that lives in the cloud and uses AI and machine learning to analyze complex medical model digital else data to generate insights.

So if you're a represents a new category of software company looking data silos MLP landscape professionals work together as a community and employees at our collective expertise.

Through <unk>, we can enable the practice of data driven mid teen in any hospital laboratory or pharmaceutical companies around the world.

We sit at the center of a virtuous cycle and benefit from powerful network effects. This means as the number of Sofia DBM users increase.

Volume of raw data input increases, which then leads to a further increase in actionable insights continuously being generated.

The blood from improved and skills as more data is analyzed we couldnt committed snowballs into more and more patients benefiting from data driven medicine.

Our software model is optimally designed to support rapid growth, which further strengthens our position for the future growth.

And now on to our six key pillars.

Starting off with our first pillar of custom reduction and network expansion.

Health care institutions continue to choose <unk> as their trusted cloud based analytics platform.

We had a strong finish in the fourth quarter with a total of 791 customers across more than 70 countries.

We're continuing to invest in our U S opportunity and firmly believe there is significant runway ahead of us.

We are pleased with our progress of Onboarding clinical customers in this region and are expecting several signed agreements with tier one institutions in the coming months.

In the Northern region, we added seven new logos in 2021. Additionally, we are seeing solid growth with our <unk> customer base in the EMEA Latam and APAC regions.

Global level, we are matching our momentum in the room.

In the APAC region, we recently announced on boarding a leading Taiwanese genetic testing company goals for fever genomics.

This is important to highlight as it is the first clinical institution in this region to all fruits of newly launched HR. This solution, which is one of our most exciting product offerings.

Beyond HRD, we are seeing substantial demand did not back for oncology applications and we recently signed new customers in Japan, South Korea, Singapore and Hong Kong.

Our continued success in landing customers across a broad geographic landscape is a testament of our talented team and execution.

Our recently appointed Ken Friedman as our Chief revenue officer to lead our global clinical sales efforts.

Ken has more than 25 years of experience serving some of the most innovative providers of technology. He has expertise is go to market strategy and execution will be a fantastic addition, as we continue our U S and global footprint expansion plan.

Moving on to our second pillar of increasing utilization within our existing clinical customer base.

As communicated on our last quarterly call, we employ a land and expand strategy that concentrates on winning new customers and then driving greater utilization of our solution baidu customers.

We are encouraged with the momentum we see with users continuing to increase their consumption after experiencing the value of Sofia platform.

Total recurring Thats from customers grew to 382 in the fourth quarter of this year up from 375 customers in the third quarter.

Total number of analyses increased to 66000 in the first quarter up from 62000 analysis in the third quarter, representing a growth rate of 6% quarter over quarter.

For us one way of growing is continuously delivering new content, which leads to our next pillar of expanding menu offering.

This is an instrumental part of <unk> and we are laser focused on driving innovation across our offerings.

We continue to provide platform users with frequent updates incorporating new features you applications you later modalities and new services.

In addition to our newly launched HRD capabilities, we expect to unveil several exciting new products. Later this year, one being <unk>, which was recently introduced at the Jpmorgan Healthcare conference in January .

<unk> is a module of the platform within our oncology applications co pack, we guide patients along the care continuum by better predicting an individual patient's disease progression and treatment options.

It provides user and indication specific comprehensive use of efficient molecular clinical and imaging data powered by robust machine learning algorithms.

We are extremely excited about this product and believe it will further differentiate <unk> as a tech company.

So if you look at the rationale clinical study called deep learning for which was announced at <unk> in November 90 data predictive model you would incur path.

The study Leverages machine learning enabled analysis of the aggregation of real World Grill T mobile data to identify them validate predictive signature associated with response to immunotherapy and prognosis of patients with metastatic stage four non small cell lung cancer.

Such signatures could help identify patients that are likely to benefit from immunotherapy, Bruce is that theyre not as well as stratify patients according to risk.

We will be making this will empower our clinicians to make more informed therapeutic decisions for their patients and accelerate the recruitment of the right patients for clinical trials run by the Biopharma companies.

Since launching the study in November 16 sites across six countries have signed up to participate.

This should contribute to over half of the 4000 total efficient targeted for enrollment over the course of this that.

We are pleased with the strong traction of the study and we view the positive reception from the participating sites is a testament to the high level of interest in looking at the predictive potential of community estate assets to large scale real World study.

From an operational perspective, we have already enrolled hundreds of patients into the study and we will provide an update on preliminary findings as for this year.

And now onto our fourth pillar of developing key partnerships and collaborations.

A robust partner ecosystem is United by equivalent and noble goal to better the lives of patients.

We are achieving great momentum with our partners and enabling our shirts customer base to generate actionable insights.

We announced last July that we enter the dalliance with GL scared to integrate data between Gs Edison platform and Sofia DBM platform as well as commercial collaboration focus on co marketing and Baidu take recruitment in the digital oncology and radio genomic analysis space.

We are currently working together on a new statement of work to begin developing the software infrastructure and architecture that will enable to be directionally change of data between <unk> and Sofia <unk> platform.

Our partnership has been going well and we have already seen significant commercial traction in lead sharing.

This collaboration integrate 12 with the developments mentioned earlier, including her pad and the deep lung Forest city.

In additional collaboration news, we announced this month that we signed a letter of intent with Ambry genetics, which is a genetic testing and clinical diagnostic company.

Our collaboration will be centered around our shared long term focus of leveraging multimodal data to accelerate research and the understanding of human diseases.

Of the many opportunities in this collaboration our focus will start on HRC.

Shifting over to the next pillar, which is further strengthening our biopharma strategy. This represents a massive opportunity for us.

While we have made excellent strides in enhancing our business in the pharmaceutical industry. We believe there is still significant market share to be captured.

In virtually to racing that in these important markets. We currently serve pharmaceutical and biotechnology companies as well as clinical research organizations. We continue to promote our current products and services, which we believe will strengthen collaborations with pharmaceutical companies.

To head our dedicated efforts in Biopharma, we recently brought on <unk> Central Ashish Biopharma will feature the.

The executive team is thrilled to have Peter was a high degree of expertise and deep relationship in this area with more than 15 years of industry experience.

He joined US in January from Silicon, a global leader in precision medicine.

Breakfast Silicon Dr. Peter It was in the senior corporate develop and rollout of <unk> and previously held leadership roles at Neogenomics and Labcorp, whereas <unk> pharmaceutical strategies.

I am delighted to welcome Peter to the team and look forward to his contribution.

Later on the call Peter will go through our plants and positioning to further strengthen <unk> presence in this space.

Now shifting to our sixth and final pillar excelling operationally within the organization.

We remain well positioned from a capital perspective to execute our near term operating and strategic plans, while retaining a level of flexibility to pursue select strategic initiatives.

Russ will discuss later, we are monitoring market conditions and remain focus with our capital to continue excelling rationally as a company.

With that I will now turn the call over to Peter.

Thank you <unk> and Hello, everyone.

I am excited to be joining the Sofia team at this point in our company's journey and look forward to help strengthening the biopharma strategic positioning.

So here is a company that I have long admired for its mission driven business model and successful performance track record.

Biopharma represents a large opportunity for us given our cloud based architecture, a decentralized global model that allows us to ingest harmonized and analyze multimodal data.

This is valuable and unique data spanning hospitals laboratories and institutions that it's frankly difficult to get elsewhere.

These data bring a much needed heterogeneity dataset to represent the environment seen in the real world, particularly for areas like oncology.

The ramp up of the Sofia ETF platform on the clinical side as it turn seeding our unique ability to support biopharma and finding patients and associated biomarkers of interest.

This applies to trials and for marketed drugs as well as helping our customers understand the global testing landscape.

Together with our edge solutions. These real world data insights can scale and ramp up rapidly supporting future revenue opportunity.

Among the many exciting opportunities we see in the Biopharma arena, So <unk> HRD solution stands near the top.

Taking a step back HRD stands for homologous recombination deficiency.

<unk> is a complex biomarker, notably important for PARP inhibitors that helps identify with our cancer patients may respond better specific treatments and a fuse could ultimately lead to personalized therapies that benefit the individual patient.

We currently have one European patent application and one U S patent application relating to a method to detect HIV, which will be used in our solution.

Our solutions decentralized nature allows users to preserve ownership of data and save time, while also offering comprehensive genomic insights without compromising the data quality.

In line with the strong traction that we are already seeing with the solution. We recently announced the partnership with Astrazeneca to expand access to in house HRD testing across European laboratories and institutions.

Having a Z as a partner further validates our model to democratize data driven medicine, leveraging a decentralized model an innovative platform for clinical decision support.

This is just the tip of the iceberg and we're excited to talk with other Biopharma partners around our capability to develop and deploy similar solutions globally.

With a focus on patients and technology forward approaches.

We expect this to be one of many biopharma partnerships that will form on our journey.

Intersecting across multiple stakeholders from discoveries R&D to clinical development health.

The health economics, and outcomes research digital health and commercial among others.

Each of these represent potential Sofia customers with the end goal of supporting the Biopharma industry with an enterprise wide data solution.

A lot of effort is going into evangelize into Sofia value proposition.

Especially as we continue to grow our genomics database and add in other key multi modalities decent.

These include imaging radio mix via the GE partnership.

And political and biologic features to develop test and validate our predicted analytics algorithms.

The addition of the radio mix feature extraction, coupled with genomics and outcomes data represent a unique and significant value proposition for the biopharma market.

It's exciting time and I look forward to the opportunity to support the fee has plans for growth within the Biopharma space.

And now I will turn it over to Ross to review the financial results in more detail.

The $10 $9 million on a reported basis, despite FX headwinds.

Which negatively impacted our growth by approximately 250 basis points for the full year total revenue for 2021 was $40 5 million compared to $28 $4 million for 2020, representing 42% growth.

The growth in revenue was primarily driven by new customers added to our platform coupled with increased usage rates across our existing customers. Our net dollar retention rate for the full year 2021 was 142%, which is considered best in class among the lead cloud.

<unk> software company.

<unk> benchmark of three times.

<unk> to $70000 for the prior year period.

Gross profit in the fourth quarter of 2021 was $6 $8 million, an increase of 40% compared to a gross profit of $4 $9 million in the fourth quarter of 2020 gross margin was 62% in the fourth quarter of 2021 in line with the prior year period.

Adjusted gross margin was 65% for the fourth quarter and 64% for full year 2021.

Total operating expenses for the fourth quarter of 2021 were $27 8 million compared to $16 2 million in the fourth quarter of 2020 on an <unk> basis.

General and administrative expenses for the fourth quarter of 2021 were $13 million compared to $6 $8 million in the fourth quarter of 2020 operating loss in the fourth quarter of 2021 was $21 million compared.

Compared to $11 3 million in the fourth quarter of 2020.

Full year operating loss was $71 5 million compared to $37 $4 million for 2020.

Adjusted operating loss in the fourth quarter of 2021 was $17 6 million.

Compared to $10 $9 million in the fourth quarter of 2020.

Adjusted operating loss for 2021 was $61 5 million compared to $34 $2 million in 2020.

Net loss in the fourth quarter of 2021 was 21 $4 million or <unk> 33 per share compared to $10 5 million or 22 per share in the fourth quarter of 2020.

Adjusted net loss in the fourth quarter of 2021 was $17 $9 million or 28 per share compared to $9 $9 million or 21 per share in the fourth quarter of 2020.

Net loss for the full year 2021 with $73 seven.

$7 million or $1 33 per share compared to $39 $3 million or <unk> 93 per share for the full year 2020 <unk>.

Adjusted net loss for the full year, 2021, with $62 $3 million or $1 13 per share compared to $35 7 million or <unk> 84 per share for full year 2020.

Cash and cash equivalents were approximately $265 million as of December 31, 2021.

Organic and inorganic investments now, let us turn to our guidance and outlook consistent with the forecast. We provided earlier in January Sofia expects full year revenue for fiscal 2022 to be in the range of $51 5 million to $54 million implying growth.

Of 27% to 33% with respect to our quarterly revenue cadence, we would anticipate our results to be slightly more second half weighted versus 2021, given the timing of several key product launches as well as the anticipated ramp of key new business wins overall, we remain.

Confident in the momentum of the business as we build an even stronger Sofia in 2022 and beyond with that I would like to turn the call back to <unk> for closing remarks before taking your questions.

Our six pillars remain our foundation to drive growth and value creation for this year as well as the years to come.

I am encouraged and as confident as ever about the long term, but that we have embarked on.

We have a fantastic opportunity to drive compelling returns and shareholder value.

As I reached the end of my closing remarks, I am pleased to announce that Sofia will be hosting an investor day in the second half of this year stay tuned for more details to come.

Operator, you May now open the line for questions.

Ladies and gentlemen, if you have a question or comment at this time. Please press. The Star then the one key on your Touchtone telephone.

Your question has been answered.

Press the pound key.

Our first question comes from <unk> <unk> with Morgan Stanley .

Hey, guys good morning, and thanks for the time here.

Maybe one for you Ross to kick things off can you just walk us through your assumptions at the low versus the high end of the guide and then perhaps lay out what's excluded from the guide at this stage.

Yes.

Good morning, Jeff This is youll gain.

And they leave.

Russ on through the rest of your question.

Thanks, Jay for the question. So I would say, obviously, a number of different variables relative to <unk>.

Utilization assumption is ramping of new business.

Also FX we did.

Noted in the prepared remarks half.

Unexpected I would say detriment in the fourth quarter and we're continuing to see some of that in the first quarter. So so a lot of it is frankly just relative to <unk>.

Some of the uncontrollable factors, we have in the business, but overall.

I would say.

<unk>.

That can provide incremental contribution over the course of the year, we're very fortunate to have a business that's incredibly visible and so we wanted to present something.

That we felt based on our backlog that we were carrying into the year as well as the bookings momentum we saw in 2021 and the utilization trends are something that we felt very comfortable with it.

At both ends of the range.

Got it that's helpful.

And then just on the point you made about about the visibility you guys. I mean in terms of things like labor shortages in hospital or is it perhaps shortfalls in cancer screening volumes.

Are you seeing any of those.

Did any of them impact January and have those trends improve here into March and can you comment on customer appetite to try out new solutions, given the uncertain operating environment and inflation pressures.

Yes. Thank you digest, so indeed, the current environment of being I would say.

A bit.

Well overall, writing the worth now said that you may remember that.

Where Nokia we're fortunate with our business to support that Guy that makes centers, primarily and so in terms of volumes of patients there.

Their volumes are not <unk>, right with COVID-19 or as well with what's happening now in Ukraine.

So we don't see an impact on the volume of activity of our clients in the platform that is updated every hour. So we havent and I really view on what's the consumption of the platform.

We haven't seen that in general we haven't seen that in February we haven't seen that in March and they would say.

Thanks Scott.

It's efficient set the other way so we didn't benefit from this type of testing and then maybe as well.

Land options that they could benefit from.

Now in terms of appetite suggest we do see a lot of appetite in particular and I think we've been quite clear about that but regarding HRD testing.

As you may have heard that as well now a PARP inhibitor has started to be used as adjuvant.

For breast cancer treatment.

So people understand that many more patients will have to be tested with the HRD score and we do see a lot of demand there across the board from Opex to low run to Latam as well as.

Europe .

Yes, just got an answer what <unk> shared.

I would say in terms of the first quarter.

It's always tough to ascertain sort of certain factors driving and what drives I would say overall.

<unk> has been pretty consistent.

Strong throughout the period and so we've seen a number.

<unk> of the notes from from peers, and frankly haven't seen that same level of volatility that being said I would say on the new business side.

It's a really interesting period for us, we're seeing I would say unprecedented activity with very large customers.

So the size of serving.

Rfps or quotes are much bigger than what we have seen in the past in some quite significant.

Not only the size of the conversation, but the types and the players that were.

Discussing with them. So I would say overall, it's still quite a healthy environment for us, but obviously as I mentioned when I answered your question with respect to the range. There are some things we can control and you can obviously see the situation in the Ukraine, what that's done to some currencies and so that's probably for us more of the volatility.

The underlying I would say drivers of the business.

Got it and then one final one for me here on.

Can you help us.

Some numbers are perhaps I use this opportunity.

Help us think through some of the addressable market sort of implications of Capex.

So let's start with I can't disclose the numbers regarding the addressable market suggests but beyond that I think given Europe .

Ching on something very important.

It's it's an opportunity for me to share with you again, what is a revision like right. So we believe that they will be a second player that will break data silos across hospitals and data modalities and in particular in cancer.

Enable hospitals to basically monitor real time real world sufficient cases versus other patients that suffer from the same type of cancers that are being treated with a different type of therapies for it and so by doing that one can start clustering patients to better empower oncologist and making decisions when it comes.

Two of the most promising treatment path as you may remember, we launch and therefore it into current path for deep lung cancers. So stage four non small non small cell lung cancer.

Which are efficient sets today, primarily benefit from immunotherapy and where actually there is not great predictive model to know who will benefit from the therapy, and who will not benefit from that therapy and as you know immuno therapy becomes more and more prominent in cancer right. So which gives you an indirect sense of the size of the market and.

And so the numbers that we are being a liking this quarter are more related to our adoption of the <unk> in the context of the deep lung for where we said that we are being already able to active activate 16 sites to run this clinical trial, a clinical study, which is tremendous right because as you remain remember to Jessica.

Since the launch of this study in November last year at <unk> and since then we are being.

I would say very appealing to many and being able to attract 16 sites across six countries, including recently Umass Andover are going to present the first presents.

As for this year beyond the clinical markets, where the current basket served the oncologist as I was explaining this is a extremely important of UC as well as for the biopharma to deliver to the market more targeted treatments, so which isn't it.

With our technology.

Got it very helpful. Thanks, guys.

Thank you have a good day.

Our next question comes from Mark Massaro with BTG.

Hey, guys. Thank you for taking the question I guess Raj you talked about.

Youre seeing unprecedented activity from large customers can you give me a sense for how much of this is coming from academic centers, our labs in the U S versus maybe hospitals labs, and our biopharma globally.

Yes.

Mark good morning.

So indeed as you may remember right, we've been primarily servicing academics centers from inception.

<unk>, which as you know are very sophisticated centers and I think this demonstrated to the uniqueness of our technology right because to be able to penetrate these academic centers you need to come with a technology that is highly differentiating.

More recently, we have been announcing important.

Contracts, we've been signing with some reference labs around the world saw.

Last year, we announced that.

Great being upgraded with our HR the capabilities. This quarter, we announced so few about genomics in Taiwan being upgraded or actually adopting our HIV capabilities. Another private land and as you know there was always a question whether it's technology players like <unk> with great success in the U S where a more.

Samples are going to the reference lab and the central as risks other countries, which are much more decentralized.

The good news is that yes, we do see traction you may have seen our press release with Ambry genetics.

We are partnering so that we will be able to eventually support.

All of their buy it from a technique and we see the same traction with menu other reference labs in central labs in the U S. Right now Marc and I think to some extent.

No.

The industry is becoming a more sensitive about industrializing solutions and so phase ring technically you would like Sophia who can bring robust.

Day to day outcomes from our platform rather than themselves their own value from our 16th right.

So we expect to be signing much more of these type of contracts in the future and by doing so.

We're all of our business and the neuron market.

Okay.

Add onto what Youre.

Go ahead, Russ I was just going to say Mark I'd just add on I think obviously these deals are larger and more complex and take a bit more time, but I think it's interesting. If you look again at our activity levels in the business.

Interesting the number of players in the realm that.

<unk> spoke to in the U S and ex U S that are all coming to I think a similar conclusion at or around the same time right. So to me it feels like there is some shift in.

In recognition that elements on the data side arent core to many of these businesses and or they need to have someone like us who's a technology enabler allow.

Allow them to achieve sort of the strategic merits that they want to strive for in a cost efficient way and so I think.

That's very encouraging for us and it's frankly, a new development over the last number of months.

Again quite excited about what I'm seeing and the activity levels and hopefully we will have more to share for you over the balance of 2022.

Okay, and then as we think about care path.

Talking about your math I think you talked about 16 sites have adopted.

Our readouts over the coming year.

Yes, so the stage we're in basically Mark is a stage, where we are demonstrating the value of following this.

<unk> data longitudinally right and we.

We decided to start with the non small cell lung cancer stage four four.

For patients that are being treated with immunotherapy because.

Hey, what's sitting to digest.

There is not a good biomarker to predict who will respond or would not response to immunotherapy and these type of treatments are expensive and can be toxic as well right. So we skirt path as one is gathering data.

We believe that thanks to our machine learning techniques, we will be able to create cohorts of patients.

Can you give us more informed perspective to the oncologists on what would be the chance for that next patient versus other efficient to benefit from immunotherapy.

Along those lines.

Market.

Market adoption is anticipated not before we start disclosing the numbers right. So we are building. It so roni step by step first for non small cell lung cancer as I explained.

First data will be.

<unk> to the market in escrow totaling what's we're going to continue to study and just as a recap. The study aims to follow 4000 patients longitudinally and should end by 2023.

Or if you like for this potential predictive capabilities Marek you Shouldnt expect the tariff as being <unk>.

Commercialized before end of 2023.

The site to that as we do so we are building capabilities for the Biopharma industry.

And we could before we release the results of the final results on a deep love for steady already leverage on a recurrent bus capability throughout the biopharma industry.

Basically further Tyler to these type of studies, maybe Peter you want to give a perspective of what's the power of our model here versus what you are seeing in other companies, where you add the seniority their ship products.

Yeah sure. Thanks, Jeremy.

The deep lung four study is definitely a very hot area right now.

In the Biopharma conversations that we're having particularly around.

As you already mentioned how can we look at these patients longitudinally I mean, I think thats the key.

Really understanding.

Their treatment outcomes in coordination with their genomic radeon data and to have a platform that can follow these patients in the real world.

It is critical right and so I think the other key piece. There is now we're having conversations with biopharma.

Essentially.

How we could stand up care path.

For clinical trials, so I think when you straddle both clinical trials and real world data.

The market potential really becomes quite large.

Yes that makes sense and my last question, obviously, you have strong visibility with your base business.

That keeps clicking and resonating around the world.

But I'm just curious you've talked in the past about.

Pursuing digital pathology spatial genomics transcript genomics metabolomics and proteomics.

How do you balance maybe some of the investment.

In your base business.

Winning new customers versus investing in new platform in place for the future.

Sure Mark.

As you May remember, our philosophy is first to be able to support labs in the chemical market as well as biopharma companies.

That data that already exists today right.

And so.

Aging data are the preeminent in the field of cancer to follow Ron you've seen early patients genomics data have started now to be adopted of course pathology information is very important but there are still skew.

Scanners to digitalize the slides out there in the market.

Our philosophy is that as this type of technology as we move from the life science field to the clinical market our platform needs to be right. So that we can onboard this type of data modalities, but along those lines maybe on the Biopharma side feature it can give you a sense as well of what is yet.

Tight and the demand today for multi modality diverse omics datasets.

Yes sure Thanks, Jeremy.

So mark we're actually having these exact conversations with Biopharma right now.

They're looking at what we're doing on our version of multimodal, which has been I think focus more so on genomic and radio Mac with the with the clinical data and <unk>.

<unk> Biopharma have other ohmic data that <unk> been generating with.

Partner Labs.

Mentioned digital pathology for example, Thats just that.

It's definitely been a sort of a hot.

Idled, if you will because they know we already have.

The infrastructure and the algorithms to do imaging segmentation for radio mix. They want to also bring in there.

Digital pathology data and add that as yet another day.

Data stack that we can bring.

And include into our predictive algorithms.

Whether it is us doing the digital pathology segmentation or even just kind of bringing in their own.

Segment of data from our partner they need they have been working with either way they see the power of adding that plus radio mix in genomics and clinical and so you just kind of continuously adding these these layers in these data stacks that then it just increases it helps with the fidelity of the algorithm right. So I think digital pathology for sure.

And then we have some others.

Some other sort of genomic type data as well as proteomic data that they want to also bring in so.

That's why that's where this is heading and that's why we're excited because it's really going to make these predictive algorithms.

Stronger as we move forward.

Okay, Alright, that's it for me.

You should.

Yes, Okay, just one comment around that obviously, we're very careful about cash management and maybe Russ wants to make a comment around that yes. One other thing Mark just to keep in mind right. We already have a fairly I would say establish commercial model in our product market fit right for our.

Our platform and so in that sense, our LTV to CAC right remains really robust frankly, it may even be too high right now and so in that our commercial investments are yielding incredibly strong returns and so that really allows us to think about the number of these opportunities and also utilized partnerships, which tend to be <unk>.

Efficient and so we were fortunate in our model that we're able to balance many of these ambitions being.

Being a software player without having to materially ramp up spend and so on that.

We're able to move into many of these exciting growth areas, but maintained I would say the operating burn and profile you would expect for a business like ours, which differs from many of the other peers right traditional peers in the life science space.

Thank you. Our next question comes from Dan Brennan with Cowen.

Yeah.

Great. Thanks, guys for the questions Youre welcome Peter.

I guess my first question would just be on the 20.

22 guide so you grew 42% and 21% ex FX excuse me.

The 45 the.

No. The guide this year I think at the midpoint about 30, obviously, you've got some of the omnicom impact still but I'm just wondering.

Is that just conservatism or are there other factors to consider with the step down in growth.

Thank you Dan and good morning, So first I would say.

I would say Dan we are very proud of driving can vote to this growth, 42% year on year as being tremendous for Sofia and.

And Russ can give you more color on your question, Yes, I think Dan just philosophically right, we want to set realistic expectations.

Our business is super visible right. So our goal is to consistently be able to perform rider outperform and so you should think about that.

And we're relatively conservative.

As a as a team in terms of how we externally communicated. So you should think about that in the context of the guide, but I would say I would certainly think about.

Uh huh.

The growth that we've guided to the 30%.

We hope to be able to share with you consistently strong performance and again as as the macro.

Hopefully does not deteriorate.

<unk> further from where we are and we consistently outperform and you see from US several of the other exciting things we've alluded to on this call. We hope to be able to continue to deliver strong results over the balance of 'twenty two.

Great. Thanks for that maybe maybe on the U S side.

Yes.

Critical growth aspect.

Focus for you as a percentage of revenues picked up here in the past couple of years.

I think it's around 10% or so can.

Can you just walk us through kind of your mix of customers in the U S. Today.

Between AMC and maybe some of the larger.

Maybe more reference lab type customers and while our community.

Is what can drive a bigger inflection in the U S growth rate here to see it become a bigger part of your business going forward.

Yes. Thank you then.

As you May remember right. When we started in the U S. We started really with academic centers and we've been sharing a number of names, which are really tier one framing them to institutions like more feet or Mayo clinic and others.

Users end customers of our platform now as you know a lot of time folks as well go in leading the U S to reference labs in Central Labs.

And we are seeing more and more traction there.

Those type of labs, and we just announced this week you may have read.

The press release regarding the letter of intent, we have signed with Ambry genetics, which I think kind of highlight what we can do with any reference labs in any central labs as being an enabler right for their own business. So this will be definitively a way to grow for us in the U S. Beyond that's done.

So penetrating these accounts in the U S. We can grow as well.

Immediately mobile capabilities and this goes as well in line with what we have been discussing again with Ambry genetics for Mayo clinics will take two examples where beyond genomics, we're starting together as well too fueled capabilities, which are immediately model two combined genomics and radio mixed data and lastly in that journey.

Our partnership with GE, which is already very well set right now in the U S labs and hospitals with VNS through retro for Sofia to penetrate the market.

Great. Thanks, Vivek, maybe maybe.

In terms of the ASP per per customer.

It is the right way to think about it kind of in that.

Mid single digit plus type of level or as you add these capabilities could there be an inflection and kind of the revenue capture per customer going forward a moment that big.

Thank you.

Sure. So I would say on the ASP side, obviously, we've had now for many years, a very favorable trend I would say consistently it should be certainly apples to apples.

That mid single or low to mid single range I would say overall right. It will very much depend on product mix.

And how the market develops right. So you think about the shift to larger panels, you think about adding on incremental capabilities over time, and radeon mix or digital pathology or some other areas. Those are going to have different impacts right on the mix and on the ASP and so I would say overall.

<unk>.

We feel quite confident that our percentage of the total value share of a patient or diagnostic will go up materially over time.

And I would say again, maybe going forward, we will try to provide a little bit more color on same store ASP movement versus overall ASP movement, because again I think mix will have a huge.

Our value share is moving in the right direction and less along those lines.

Yeah.

You're very welcome as well the fact that.

More and more things are going to be regulated in aerospace because this should increase as well the reimbursement proficient for genomics and beyond.

Well, what I would say make the market bigger because for not the early adopters, but the later adopters, having a regulated market basically reassures them right on the fact that they will be able not only to support patients, but will reimburse for this activity. So along those lines again.

Guarding HRD, which is something we've been speaking a lot about we have good hope that this paper analysis will be significantly superior to what we have today in terms of HSBC and that this should contribute on seeing our ASP go up as we have been seeing over the last.

Eight years.

Great and then if I could just sneak one more in just on Biopharma.

How do we think about the impact on your revenues and kind of profitability as biopharm becomes grows as a percentage of mix. So.

Could you help us think through like what what's assumed for Biopharma contribution this year.

Could we expect to see additional agreements like the Astra agreement and then any comment upon kind of where biopharma could go over the next few years.

This is a bit early to assure we view then.

We like to assure a number it's on things where we are.

Uh huh.

Rusty Supreme visibility right and so this requires having already in ongoing business, but when it comes to numbers and traction Peter can I'd liked you.

The number of discussions we're having right now with the pharma.

Yes sure Thanks, Gary.

So the Biopharma is definitely.

The number of conversations.

Uh huh.

Ticked up quite a bit I mean, we're now speaking with 18 of the top 20 large pharma.

Globally, and so and these really range from our genomic insights real world data Multimodal studies that we've talked about all the way through to new product launches like HIV.

So while we can't give the revenue mix today, I mean, just rest assure that.

These conversations lead to more proposals more proposals lead to more bookings.

Great Alright, guys. Thanks, a lot.

Again, ladies and gentlemen, if you have a question or comment at this time. Please press. The Star then the one key on your Touchtone telephone.

Our next question comes from Julian <unk> with J P. Morgan.

Hi, Good morning, Thanks for taking the question just a couple of follow ups regarding a deep study could you give us a sense of a timeline and what we might expect a product to be commercialized around it.

The main study that Youre planning to run at the Beach.

<unk> had our multimodal.

Other potential indications that you are planning to pursue in parallel.

Yes, good morning, and thank you Julia.

So couple of answers right to your question, which is is it.

An important question.

As we are being cleared so we are building this platform to be multimodal right and so this is extremely important to be able to cluster efficiency and basically give them all to the oncologists are more informed perspective of one how would a patient a given patient looks like all of their patients and so in.

In this context, we started to <unk>.

Module in the platform with a deep lung for data, which intend to basically following this study 4000 patients across about 30 sites for the next 18 months now.

So that we would it be eventually able to equip oncologist with new ways to follow patients, but on top of that as well.

Both to eventually predict which patients are suffering for non small cell lung cancer would respond or not response to immunotherapy.

And that's important because I assume the immunotherapies have become very prevalent but in the meantime are very expensive and there is no clear biomarker that can explain who will benefit from this type of treatment or not so in terms of product to answer. Your first question in the clinical market, we don't intend to sell this curve faster than <unk>.

<unk> capabilities in before the end of the study right because we have to make it very thorough and we are looking at raising as well under design control to support our claims.

Beyond that the curve has capabilities are very important for all of the type of cancer is to answer your second question until we contemplate to launch as well as other studies eventually truly around brain cancer eventually around.

Breast cancers to be seen but indeed the platform capabilities on the curve that are being used so that they can be universal and holistic to any type of solid tumor and thats a very important.

So thank you for the question.

Last beyond the clinical market, we can already leverage on the third path with the Biopharma right and Peter and his team today are being.

Having.

Discussions over the last weeks with 18 out of the top 20 pharma worldwide, including our carrier class capabilities to eventually as well support real time real world clinical trials.

In a decentralized way, while our modernizing and collecting that data into our platform and in that sense to finish Julia the GE partnership as well it's important for us because.

Thank you that's very helpful color.

And then just in terms of.

Large central labs and.

You mentioned that you expect a number of large customer announcements in the coming months.

Is it possible for you to give us a sense of how many central labs, youre working with or in discussion in the pipeline today and then presumably the central App customers are stickier and you run at a much higher pull through versus your regular customers.

Do you think demand the whole menu only pieces of the workflow I mean is there a different.

The central lab in terms of the capabilities demand or their willingness to share data.

How should we think about pricing and profitability profile of the central lab customers.

Yes. Thank you Julia So first I cannot share with you number as Fred regarding our pipeline Thats what they can tell you is that we're discussing with.

Most silver them today.

And to answer your second question, we're discussing with many of them.

For different type of application is very rare that it's to cover all of their needs. Because <unk> itself is already have already established solutions for some of the testing that they already have in routine.

Now.

I agree its a bit different so im really that we just announced could be indeed, a very broad and global partnership to eventually cover all their needs.

And I think.

This is obviously, what we aim to do with any rights, but our job in yen Juliet is very <unk>.

First we need to demonstrate this central labs that we bring many benefits for a specific application such as HRD or such as gene fusion detection or eggs on data computing and once we have done that we move to the next tablet cash and right to the next project and so this is how we are seeing always growing as well.

In the academic market through the so called land and expand business with us when it comes to the stickiness.

From what we have seen indeed, the type of partnership that we have build with our central labs and reference labs like that and it was being very public about that being all the way through a long lasting very close.

So in terms of the ability of soft yet to be I would say embedded in the system.

Pretty profound but that's just as a reminder, our churn rates even in the academic centers is very low it's below 1% a quarter right. So.

We we.

I would say benefit from the efforts. We initially set in the academic center now to grow in the U S with the central labs, but we don't operate the growth very differently than what we have been experiencing with the academic centers, which is something quite nice frankly, because it means that in terms of execution our recipes.

Worked very well as well in the central labs.

Okay Super helpful. Thank you so much.

And Im not sure ill talk further questions at this time I would like to turn the call back to Juergen for any closing remarks.

So given there is no more question I would like to thank you all for.

Having heard that we're earning call and Q&A session today same tune and indeed, you can expect news from us in the next weeks and months as we are penetrating the U S market they bring a.

Our capabilities to the Biopharma space as well as building our own multi modal capabilities. Thank you all and have a great day.

Ladies and gentlemen, this does conclude today's presentation. You may now disconnect and have a wonderful day.

Q4 2021 Sophia Genetics SA Earnings Call

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